Transcat to Attend Upcoming Investor Conferences in November Share ROCHESTER, N.Y.--(BUSINESS WIRE)--Transcat, Inc. (Nasdaq: TRNS) ("Transcat†or the "Company†), a leader in test, measurement, control and calibration, today announced that management will attend the Baird 2025 Global Industrial Conference, Raymond James Sonoma Small Cap Summit, and Stephens Annual Investment Conference in November 2025. Stephens Annual Investment ConferenceDate: November 19, 2025Location: Grand Hyatt Nashville, Nashville, T ...

Financial Data and Key Metrics Changes - Consolidated revenue increased by 15% to $76.4 million, driven by strong demand for calibration and rental services [7][15] - Adjusted EBITDA grew by 15% to $11.8 million, with a margin expansion of 10 basis points [17][18] - Net income decreased by $1.1 million to $3.3 million, primarily due to higher interest expenses and taxes [16] Business Line Data and Key Metrics Changes - Service revenue grew by 12%, marking the 65th consecutive quarter of year-over-year growth [8][15] - Distribution revenue increased by 19% to $27.3 million, with gross profits rising by 24% and gross margins expanding to 35.2% [13][15] - Total organic service growth, excluding Transcat Solutions, was 2% [9] Market Data and Key Metrics Changes - The acquisition of ESCO Calibration is expected to enhance Transcat's capabilities in specialized high-end electronic calibrations, particularly in regulated markets [10][11] - The company anticipates a return to high single-digit organic service revenue growth as the fiscal year progresses [21] Company Strategy and Development Direction - The company aims to leverage acquisitions to fortify its core calibration business and expand addressable markets [21] - Continuous process improvement and automation are identified as key drivers for future service margin expansion [21] - The focus remains on generating sustainable long-term value for shareholders [21] Management's Comments on Operating Environment and Future Outlook - The macro environment presents challenges, but the diversified portfolio and strategic acquisitions position the company well for future growth [21] - Management expects to progressively improve organic revenue growth during the fiscal year, barring further economic deterioration [21][58] Other Important Information - The company closed a new five-year credit facility that nearly doubles its capital resources, providing significant financial flexibility [19] - The integration of ESCO is expected to be swift, with anticipated sales and cost synergies [11][12] Q&A Session Summary Question: What drove the strong distribution results? - Management indicated consistent demand across both core distribution and rentals, suggesting that the growth is indicative of more than just pull-in revenue due to tariffs [26][27] Question: How does ESCO compare to Martin in terms of growth potential? - Management believes ESCO can be a similarly successful acquisition as Martin, with both companies having strong regional dominance but differing specialties [31][32] Question: What is the expected growth rate for ESCO? - Management characterized ESCO's growth rate as similar to Transcat's, indicating a high-quality company with consistent growth [38] Question: How will Transcat Solutions impact overall growth? - Management expects stabilization in the solutions business, contributing to high single-digit growth in the back half of the year [41][42] Question: Is there a potential for pricing power in the current market? - Management noted that there are opportunities for growth, particularly in outsourcing calibration services to in-house labs, which could enhance pricing power [85][88] Question: How does onshoring manufacturing in the U.S. affect Transcat? - Management confirmed that any onshoring of manufacturing is beneficial for Transcat, with ongoing discussions indicating potential future growth opportunities [72][76]

Financial Performance - Consolidated revenue increased by 15% year-over-year to $76.4 million[9, 12] - Service segment revenue grew by 12% to $49.1 million[9, 12] - Distribution segment revenue increased by 19% to $27.3 million[9, 12] - Consolidated gross profit increased by 14% to $25.8 million[15, 16] - Adjusted EBITDA increased by 15% to $11.8 million[9, 21, 23] - Net income decreased by 26% to $3.3 million[9, 19] Segment Performance - Service segment gross profit increased by 9% to $16.2 million[9, 15, 16] - Distribution segment gross profit increased by 24% to $9.6 million, with gross margin expansion of 130bps to 35.2%[9, 15, 16] - Distribution adjusted EBITDA increased by 49% to $4.8 million[21, 23] Strategic Initiatives - Transcat acquired Essco Calibration Laboratory for $84 million in cash[10] - A new 5-year $150 million syndicated secured credit facility was established[9, 10, 28]

Financial Data and Key Metrics Changes - Consolidated revenue increased by 2% to $6,680,000, driven by growth in distribution [6][14] - Organic service revenue declined by 4% year-over-year, primarily due to softness in the Nexa solutions channel [6][14] - Consolidated gross profit decreased by 6% to $1,970,000, with service gross profit down 8% [15] - Net income for Q3 was $240,000, down $1,000,000 compared to the prior year, with diluted earnings per share at $0.25, down $0.13 [16] - Adjusted EBITDA was $790,000, down 13% from the same quarter in the prior year [17] Business Line Data and Key Metrics Changes - Service revenue saw a slight growth, but organic decline was offset by acquisitions [14] - Distribution revenue grew by 7% to $2,520,000, driven by strong product sales and rental growth [11][15] - Rental revenue experienced a decline in December due to extended customer closures, negatively impacting distribution service margins [11][12] Market Data and Key Metrics Changes - The core calibration service demand saw a decline in December, attributed to holiday-related manufacturing closures [7][9] - The rental channel faced similar demand declines, affecting overall distribution performance [11][54] Company Strategy and Development Direction - The company is focused on integrating Martin Calibration, which is expected to enhance service growth and productivity [10][22] - Management aims for strong organic service growth and improved operational efficiencies through process improvements and automation [22] - The company maintains a strong pipeline of new opportunities in calibration services, anticipating a return to historical growth rates [21][30] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of holiday timing on service demand and expressed confidence in a recovery in January [26][27] - The outlook for organic service revenue is expected to be in the low to mid-single digits, below previous expectations [21] - Management remains optimistic about the fundamentals of the business and the potential for strong performance in the upcoming fiscal year [35][36] Other Important Information - The company acquired Martin Calibration for $79,000,000, enhancing its presence in key markets [19] - The company reported total net debt of $4,080,000, with a leverage ratio of 0.97x [19] Q&A Session Summary Question: Near term outlook and guidance reduction - Management confirmed that December's slowdown impacted guidance, but January showed recovery, leading to conservative full-year guidance [26][27] Question: Visibility in the pipeline and expectations for next year - Management reported a strong core calibration pipeline, with some delays affecting guidance but remains optimistic for the upcoming year [30][31] Question: Service gross margins and future expectations - Management expects service margins to stabilize and grow in the upcoming quarters, aiming for consistent performance [46] Question: Distribution performance and rental recovery - Management indicated that the rental business was impacted similarly to calibration services, but expects recovery as demand increases [54] Question: Working capital and inventory management - Management noted improvements in inventory levels and accounts receivable due to the acquisition, aligning with revenue growth [50][51]