Mesa Labs (MLAB) came out with quarterly earnings of $2.23 per share, missing the Zacks Consensus Estimate of $2.75 per share. This compares to earnings of $2.77 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -18.91%. A quarter ago, it was expected that this quality control instruments and disposable products maker would post earnings of $2.45 per share when it actually produced earnings of $2.67, delivering a surprise of 8.9 ...

Employee and Workforce Management - As of March 31, 2025, the company had 730 employees, with a voluntary employee turnover decrease of approximately 2.0 percentage points compared to the previous fiscal year, indicating improved employee satisfaction [71] - The company has implemented various health and wellness programs to enhance the physical and mental well-being of employees globally [76] - The company maintains a commitment to an inclusive workforce, aiming to reflect the communities in which it operates [73] - The company has invested heavily in talent acquisition and development processes, including standardized assessment processes and mentoring systems [72] - The company’s compensation package includes market-competitive pay, cash bonuses, stock-based compensation, and comprehensive benefits aimed at attracting and retaining talent [75] Financial Performance - Total revenues for the year ended March 31, 2025, were $240,978 thousand, an increase of 11.5% compared to $216,187 thousand in 2024 [302] - Gross profit for the year ended March 31, 2025, was $150,870 thousand, representing a gross margin of 62.6% [302] - Operating income for the year ended March 31, 2025, was $16,336 thousand, a significant recovery from an operating loss of $272,075 thousand in 2024 [302] - Net loss for the year ended March 31, 2025, was $(1,974) thousand, compared to a net loss of $(254,246) thousand in 2024 [304] - The company reported a comprehensive income of $3,006 thousand for the year ended March 31, 2025, compared to a comprehensive loss of $(256,206) thousand in 2024 [304] Cash Flow and Liquidity - Cash and cash equivalents as of March 31, 2025, were $27,321 thousand, a decrease from $28,214 thousand in 2024 [300] - Cash provided by operating activities increased to $46,808 thousand in 2025, compared to $44,133 thousand in 2024, reflecting a positive trend in operational efficiency [310] - Net cash used in investing activities was $4,499 thousand in 2025, a decrease from $81,306 thousand in 2024, suggesting improved investment management [310] - Proceeds from credit facility borrowings amounted to $73,465 thousand in 2025, compared to $71,000 thousand in 2024, indicating increased financing activity [310] Assets and Liabilities - Total assets as of March 31, 2025, were $433,348 thousand, down from $446,796 thousand in 2024 [300] - Total liabilities as of March 31, 2025, were $273,518 thousand, a decrease from $301,403 thousand in 2024 [300] - Stockholders' equity increased to $159,830 thousand as of March 31, 2025, from $145,393 thousand in 2024 [300] Research and Development - Research and development expenses for the year ended March 31, 2025, were $19,518 thousand, slightly up from $19,300 thousand in 2024 [302] - Research and development expenses are primarily composed of labor and third-party consultant costs, with costs expensed as incurred [348] Acquisitions and Goodwill - The company did not acquire any businesses in fiscal year 2025, while it acquired businesses for total net purchase prices of $87,187 million in 2024 and $6,140 million in 2023 [367] - Goodwill related to the GKE acquisition amounted to $48,850 as of March 31, 2024 [404] - The estimated fair value of consideration held back from the GKE acquisition was approximately $9,300 as of March 31, 2025 [391] Taxation - The total income tax expense for the year ended March 31, 2025, was $7,935,000, compared to a benefit of $(21,402,000) for 2024 [437] - The effective income tax rate for 2025 was 133.12%, compared to 7.76% in 2024, indicating a substantial increase in tax expense [438] - Deferred tax assets, net, decreased from $15,718 million in 2024 to $12,739 million in 2025, primarily due to an increase in the valuation allowance [439] Inventory and Cost Management - Total inventories decreased from $32,675 in March 31, 2024 to $25,365 in March 31, 2025, a reduction of approximately 22% [407] - The company maintains an inventory reserve for excess or obsolete inventory, which may fluctuate based on new information or changes in business conditions [335] Segment Performance - The company operates in four reportable segments, focusing on life sciences tools and quality control solutions for regulated applications in the pharmaceutical and healthcare industries [311] - The Sterilization and Disinfection Control segment generated revenues of $93,418 million in 2025, up from $75,124 million in 2024, marking a 24.3% increase [449] - Clinical Genomics revenues increased to $47,081 million in 2025 from $52,588 million in 2024, indicating a decline of 10.6% [449] Debt Management - The company repurchased convertible senior notes totaling $71,560 thousand in 2025, reflecting a strategic move to manage debt [310] - The outstanding balance under the Revolver as of March 31, 2025 was $10,000, with $115,000 available for borrowing [415] - The weighted average interest rate on borrowings under the Credit Facility was 7.2% as of March 31, 2025 [410]

Revenue Growth - Quarterly revenues for 4Q25 were $62,135, representing a 5.5% increase compared to 4Q24, with core organic revenues growth of 6.3%[9] - Full fiscal year revenues for FY25 reached $240,978, an 11.5% increase from FY24, with core organic revenues growth of 5.0%[10] - The Sterilization and Disinfection Control division generated revenues of $24,749 in 4Q25, with core organic revenues growth of 10.3%[12] - The Biopharmaceutical Development division saw a 20.3% increase in core organic revenues for FY25, driven by increased spending on capital equipment in North America and Europe[15] - Clinical Genomics division revenues for 4Q25 were $11,511, with core organic revenues growth of 4.4%, but a decline of 10.1% for the full year due to regulatory challenges in the China market[16] - Organic revenues growth for the year ended March 31, 2025, was 4.6%, while total revenues growth was 11.5%[31] Financial Performance - Adjusted operating income (AOI) for FY25 increased 12.3% year over year to 23.5% as a percentage of revenues, despite a significant rise in performance-based compensation expenses[4] - Cash flows from operations for FY25 totaled $46,808, with free cash flow of $42,559 primarily used to pay down debt[3] - Gross profit for the year ended March 31, 2025, was $150,870,000, representing a 13.3% increase from $133,250,000 in 2024[26] - The company reported a net loss of $7,114,000 for the three months ended March 31, 2025, compared to a net loss of $254,583,000 in the same period of 2024[26] - Non-GAAP adjusted operating income (AOI) for the three months ended March 31, 2025, was $12,104,000, slightly down from $12,336,000 in 2024[29] Asset Management - The company reduced inventories by 22.4% compared to the prior year, enhancing its ability to manage debt[4] - The company’s total assets decreased to $433,348,000 as of March 31, 2025, from $446,796,000 in 2024[28] - Stockholders' equity increased to $159,830,000 as of March 31, 2025, compared to $145,393,000 in 2024[28] Strategic Initiatives - Mesa Labs fully integrated GKE into its corporate infrastructure within nine months and exceeded acquisition commitments for revenues and profitability[5] - The company implemented Salesforce CRM across all sales teams, contributing to accelerated bookings growth[5] Market Outlook - The company anticipates continued growth in revenues and operating performance, despite uncertainties in the market environment[24] Impairment - The company experienced a significant impairment of goodwill and long-lived assets amounting to $274,533,000 in the year ended March 31, 2024[26] Shareholder Information - The weighted average common shares outstanding for the three months ended March 31, 2025, was 5,439,000, compared to 5,394,000 in the same period of 2024[29]

LAKEWOOD, Colo., May 28, 2025 (GLOBE NEWSWIRE) -- Mesa Laboratories, Inc. (NASDAQ:MLAB), a global leader in the design and manufacture of life science tools and critical quality control solutions, today announced results for its fourth fiscal quarter ("4Q25") and full fiscal year ("FY25") ended March 31, 2025 (amounts in thousands). Fourth quarter FY25 compared to fourth quarter FY24: Full FY25 compared to full FY24: We operate our business in four divisions: Sterilization and Disinfection Control ("SDC"), ...

Core Viewpoint - Mesa Labs (MLAB) has been upgraded to a Zacks Rank 1 (Strong Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Performance - The Zacks rating system is based on changes in earnings estimates, which are closely correlated with stock price movements [4][6]. - Mesa Labs is projected to earn $10.44 per share for the fiscal year ending March 2025, reflecting an 11.3% year-over-year increase [8]. - Over the past three months, the Zacks Consensus Estimate for Mesa Labs has risen by 8.3% [8]. Zacks Rating System - The Zacks Rank stock-rating system categorizes stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7]. - Only the top 5% of Zacks-covered stocks receive a 'Strong Buy' rating, indicating superior earnings estimate revisions [9][10].

Core Viewpoint - Mesa Labs (MLAB) is positioned as a strong investment opportunity due to its improving earnings outlook and analysts' increasing earnings estimates [1][2] Earnings Estimate Revisions - Current-quarter earnings estimate is $2.75 per share, reflecting a -0.72% change from the previous year, with a 16.76% increase in the Zacks Consensus Estimate over the last 30 days [4] - Full-year earnings estimate stands at $10.44 per share, showing an 11.3% increase from the prior year, with an 8.25% rise in the consensus estimate due to positive revisions [5] Analyst Sentiment - Analysts are optimistic about Mesa Labs' earnings prospects, leading to higher estimates which are expected to positively influence the stock price [2][3] - The Zacks Rank system indicates a strong buy rating for Mesa Labs, with a Zacks Rank 1, suggesting significant potential for outperformance compared to the S&P 500 [6] Stock Performance - Mesa Labs shares have increased by 18.1% over the past four weeks, indicating strong investor confidence in the company's earnings growth potential [7]

Core Insights - Mesa Labs reported quarterly earnings of $2.67 per share, exceeding the Zacks Consensus Estimate of $2.45 per share, and up from $2.02 per share a year ago [1] - The company achieved revenues of $62.84 million for the quarter, surpassing the Zacks Consensus Estimate by 4.91%, compared to $53.47 million in the same quarter last year [3] Earnings Performance - The earnings surprise for the quarter was 8.98%, with the company having surpassed consensus EPS estimates two times over the last four quarters [2] - In the previous quarter, Mesa Labs had a negative surprise of -1.21% [2] Revenue Performance - Mesa Labs has also topped consensus revenue estimates two times in the last four quarters [3] - The current consensus EPS estimate for the upcoming quarter is $2.54, with expected revenues of $61.4 million, and for the current fiscal year, the estimate is $10.01 on revenues of $237.3 million [8] Market Position - Mesa Labs shares have increased by approximately 1.6% since the beginning of the year, while the S&P 500 has gained 1.9% [4] - The Zacks Industry Rank for Medical - Instruments places it in the top 36% of over 250 Zacks industries, indicating a favorable market position [9] Future Outlook - The estimate revisions trend for Mesa Labs is currently mixed, resulting in a Zacks Rank 3 (Hold), suggesting the stock is expected to perform in line with the market in the near future [7] - The performance of Mesa Labs may be influenced by the overall outlook for the industry [9]

Revenue Growth - Revenues increased by 13.7% during the first three quarters of fiscal year 2025 compared to the prior year period, with GKE contributing $18,971 in revenues [117]. - Organic revenues grew by 4.3% in the first three quarters of fiscal year 2025, driven by a 26.6% increase in the Biopharmaceutical Development division and a 10.1% increase in the Calibration Solutions division [117]. - Revenues for the three months ended December 31, 2024, increased by 17.5% to $62,840 million compared to $53,473 million in the prior year [126]. - The Sterilization and Disinfection Control division's revenues increased by 21.6% for the three months ended December 31, 2024, primarily due to the GKE acquisition, contributing $2,857 million [128]. - Clinical Genomics division revenues increased by 1.0% to $12,667 million for the three months ended December 31, 2024, driven by strong consumables growth in North America [132]. - Biopharmaceutical Development division revenues surged by 29.8% to $12,237 million for the three months ended December 31, 2024, attributed to increased capital spending in the biopharmaceutical markets [136]. - Calibration Solutions division revenues rose by 18.7% to $14,429 million for the three months ended December 31, 2024, due to commercial efforts and price increases [139]. - Total company organic revenue growth for the three months ended December 31, 2024, was 12.6%, compared to a decline of 8.6% in the same period of 2023 [184]. - The Sterilization and Disinfection Control segment showed a total revenue growth of 21.6% for the three months ended December 31, 2024, up from 18.8% in 2023 [184]. - The Biopharmaceutical Development segment achieved a total revenue growth of 29.8% for the three months ended December 31, 2024, compared to a decline of 19.0% in 2023 [184]. - For the nine months ended December 31, 2024, total company organic revenue growth was 4.3%, an improvement from a decline of 6.2% in the same period of 2023 [184]. - The Clinical Genomics segment experienced a decline in total revenue of 14.2% for the nine months ended December 31, 2024, compared to a decline of 14.6% in 2023 [184]. Profitability and Operating Income - Gross profit as a percentage of revenues increased by 1.4 percentage points in the first nine months of fiscal year 2025, primarily due to lower intangible asset amortization expenses [119]. - Operating income for the nine months ended December 31, 2025, was $14,867, an increase of $15,658 compared to the prior year period, attributed to increased revenues and lower amortization expenses [121]. - Gross profit for the same period rose by 19.0% to $39,754 million, up from $33,402 million [126]. - Operating income for the three months ended December 31, 2024, was $5,779 million, a significant increase of 8,725.4% from a loss of $67 million in the prior year [126]. Operating Expenses - Operating expenses remained flat during the nine months ended December 31, 2025, with increases primarily due to higher performance-based compensation and professional services costs related to the GKE acquisition [120]. - Operating expenses increased by 1.5% for the three months ended December 31, 2024, with a notable increase of 10.5% when excluding decreased amortization expenses [141]. - Selling expenses increased by 7.3% to $10,450 million for the three months ended December 31, 2024, primarily due to performance-based compensation expenses [144]. - General and administrative expenses decreased by 5.0% to $18,472 million for the three months ended December 31, 2024, but would have increased by 10.5% excluding amortization expenses [146]. - Research and development expenses increased by 17.7% to $5,053 million for the three months ended December 31, 2024, and by 2.3% to $14,422 million for the nine months ended December 31, 2024, compared to the prior year periods [148]. Cash Flow and Financing - Net cash provided by operating activities was $34,143 million for the nine months ended December 31, 2024, an increase of $2,893 million compared to the prior year [175]. - Cash used in investing activities increased to $(3,492) million for the nine months ended December 31, 2024, primarily due to equipment purchases for the Biopharmaceutical Development division [175]. - Cash used in financing activities amounted to $28,316 for the nine months ended December 31, 2024, with $23,500 used to repay the Revolver and $2,813 to pay down the Term Loan [176]. - The company plans to use cash on hand, draws against the Revolver, and cash generated from operating activities to fund $101,250 million in principal debt payments due within the next twelve months [164]. - Revenues increased by $21,560 compared to the prior year period, although cash paid for interest on the Credit Facility rose by $5,600 due to higher outstanding debt [178]. Acquisitions - The company acquired GKE for $87,187 million during fiscal year 2024, with an expected holdback of approximately $9,000 million related to the acquisition [159]. - The GKE acquisition includes a payment of approximately $9,000 due in April 2025, pending adjustments for potential indemnification losses [179]. - The Belyntic acquisition may result in a payment of $1,500 if specified patents are issued, with an estimated fair value of remaining contingent consideration at $650 as of December 31, 2024 [180]. Risks and Challenges - The Biopharmaceutical Development division is particularly exposed to currency exchange risks, with significant expenses in Swedish Krona while revenues are primarily in USD and euros [185]. - The company faces foreign currency exchange rate risks, particularly in the Biopharmaceutical Development division, which incurs significant expenses in Swedish Krona while most revenues are in USD and euros [185]. - An estimated additional cash interest expense of approximately $930 per year is expected if interest rates increase by 1 percentage point [187]. - Inflation has historically been offset by annual price increases, but future price increases may lead to declines in sales volume if competitors do not adjust prices accordingly [188]. - Material weaknesses in internal controls were identified, with remediation plans implemented, but one related to IT general controls remains unresolved [191]. - The company identified material weaknesses in internal controls over financial reporting, with remediation plans implemented during the fiscal year 2025 [191]. - GKE was acquired in the third quarter of the fiscal year ended March 31, 2024, and its control environment is now included in the assessment of internal controls over financial reporting [195].

Core Insights - Mesa Laboratories, Inc. reported strong performance in its third fiscal quarter of FY 2025, with significant growth in revenues, orders, and adjusted operating income (AOI) while reducing debt levels [3][4][5] Financial Performance - Total revenues for 3Q25 reached $62,840, marking a 17.5% increase compared to 3Q24, driven by 12.6% organic growth and 4.9% from the GKE acquisition [4][8] - AOI excluding unusual items grew by 13.3% year-over-year to $14,788, representing 23.5% of total revenues [5][8] - Operating income increased dramatically by 8,725% to $5,779, although the company reported a net loss of $1,676 due to unrealized foreign currency losses and interest expenses [8][21] Division Performance - Sterilization and Disinfection Control (SDC) generated revenues of $23,507 with core organic growth of 8.2% [9] - Calibration Solutions (CS) saw revenues of $14,429, achieving core organic growth of 18.9% [10] - Biopharmaceutical Development (BPD) revenues reached $12,237, with a core organic growth of 31.3% driven by increased capital spending [11] - Clinical Genomics (CG) reported revenues of $12,667, with a modest core organic growth of 1.9% [12] Strategic Initiatives - The GKE acquisition is expected to contribute significantly to organic growth starting in 4Q25, with initial revenues exceeding expectations [4][9] - The company aims to reduce its total Net Leverage Ratio below 3.0x by the end of 2Q26, having reduced it to 3.20 in 3Q25 [3][8] Market Outlook - The company anticipates continued year-over-year core revenue growth in 4Q25, supported by solid sales funnels and backlog [6] - Potential challenges include adapting to new U.S. policies and economic conditions, particularly in Europe [6]

Revenue Growth - Total revenues for Q3 2025 were $62,840, an increase of 17.5% compared to Q3 2024, driven by 12.6% organic growth and 4.9% inorganic contribution from the GKE acquisition[5] - Biopharmaceutical Development revenues grew by 31.3% in Q3 2025, driven by increased capital spending in North America and Europe[14] - Clinical Genomics revenues increased by 10.2% sequentially, indicating stabilization despite challenges in the China market[15] - Core organic revenues growth for the quarter was 13.2%, reflecting strong performance across all divisions[8] - The company anticipates year-over-year core revenue growth in Q4 2025, supported by solid sales funnels and backlog[7] - The acquisition of GKE will be fully incorporated as organic growth starting in Q4 2025[5] - Organic revenues growth for the three months ended December 31, 2024, was 12.6%, while core organic revenues growth was 13.2%[30] - Revenues for the three months ended December 31, 2024, increased by 17.5% to $62,840,000 compared to $53,473,000 for the same period in 2023[26] Financial Performance - Non-GAAP adjusted operating income excluding unusual items increased by 13.3% to $14,788, representing 23.5% of total revenues[6][11] - Operating income for the three months ended December 31, 2024, was $5,779,000, a turnaround from a loss of $67,000 in the same period last year[26] - Non-GAAP adjusted operating income (AOI) for the three months ended December 31, 2024, was $14,515,000, compared to $11,975,000 in 2023, indicating a growth of 21.3%[29] Debt and Leverage - The company repaid $9.4 million in debt during Q3 2025, reducing the total Net Leverage Ratio to 3.20, with a target to drop below 3.0x by the end of Q2 2026[4] Profitability - Gross profit percentage for Q3 2025 contracted by 240 basis points when excluding non-cash charges, primarily due to product and geographical mix[6] - Gross profit for the nine months ended December 31, 2024, was $112,458,000, up from $96,694,000 in 2023, reflecting a significant increase[26] Equity and Assets - Total assets as of December 31, 2024, were $437,148,000, a slight decrease from $446,796,000 as of March 31, 2024[28] - Stockholders' equity increased to $155,214,000 as of December 31, 2024, compared to $145,393,000 in March 2024[28] Net Income and EPS - The company reported a net loss of $1,676,000 for the three months ended December 31, 2024, compared to a net income of $2,116,000 in the same period last year[26] - Basic earnings per share (EPS) for the three months ended December 31, 2024, was $(0.31), down from $0.39 in 2023[26] Non-Operating Expenses - The company incurred non-operating expenses of $7,996,000 for the three months ended December 31, 2024, compared to income of $(2,013,000) in the same period last year[26]