Transcat, Inc. · NASDAQ:TRNS
Transcat — Q2 FY2020 Earnings Presentation
14 slides from Transcat's earnings presentation, Oct 23, 2019
Slide 1: Q2 Financial Results Fiscal 2020
Q2 Financial Results Fiscal 2020 Lee D. Rudow President and CEO Michael J. Tschiderer Chief Financial Officer 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical fact and thus are subject to risks, uncertainties and assumptions. Forward-looking state
Slide 3: Q2 2020 Execution
Q2 2020 Execution Record Q2 revenue of $41.8M, up 7.4% (5.5% when excluding acquired revenue) Productivity initiatives developing early traction: Gross margin up 150 bps and Consolidated operating margin up 170 bps Results Net income increased nearly 60% to $2.4M Diluted earnings per share of $0.32,
Slide 4: Leveraging Technology as a Competitive Advantage
Leveraging Technology as a Competitive Advantage Proprietary “C3™” Portal for customer asset management 4
Slide 5: Record Revenue
Record Revenue ($ in millions) 10% Q2 Service Segment Consolidated – Annual CAGR¹ $160.9 $169.5 $23.5 $143.9 $155.1 $122.2 $19.9 $77.4 $84.0 $90.7 $71.1 $59.2 $63.0 $72.8 $77.7 $76.9 $78.8 Q2 FY 2019 Q2 FY 2020 FY 2016 FY 2017 FY 2018 FY 2019 Q2 FY20 TTM Service Distribution Q2 Distribution Segment
Slide 6: Operating Income
Operating Income ($ in millions) 17% Q2 Service Segment Consolidated – Annual CAGR¹ $10.2 $11.0 $1.8 $9.0 $7.9 $6.3 $5.2 $5.6 $1.1 $5.2 $4.8 $4.2 $5.0 $5.5 5.7% 7.8% $3.2 $3.9 $2.1 Q2 FY 2019 Q2 FY 2020 FY 2016 FY 2017 FY 2018 FY 2019 Q2 FY20 TTM Service Distribution Q2 Distribution Segment • Servic
Slide 7: Net Income & Diluted EPS
Net Income & Diluted EPS ($ in millions, except EPS) Annual Quarterly 22% CAGR¹ $8.3 $7.1 $5.9 $4.5 $2.4 $4.1 $1.5 $0.58 $0.64 $0.81 $0.95 $1.11 Diluted EPS $0.20 $0.32 FY 2016 FY 2017 FY 2018 FY 2019 Q2 FY20 Q2 FY 2019 Q2 FY 2020 TTM • Q2 FY20 reflects increased discrete income tax benefits related
Slide 8: Adjusted EBITDA and Margin
Adjusted EBITDA¹ and Margin ($ in millions) 18% Q2 Service Segment CAGR² Consolidated – Annual $3.1 $17.8 $18.7 $16.4 $2.4 $14.5 $10.6 $10.6 $11.0 $10.2 $9.6 $7.5 12.1% 13.2% $6.2 $7.2 $7.7 $3.1 $4.9 Q2 FY 2019 Q2 FY 2020 FY 2016 FY 2017 FY 2018 FY 2019 Q2 FY20 TTM Service Distribution Q2 Distributi
Slide 9: Financial Flexibility Supports Growth Strategy
Financial Flexibility Supports Growth Strategy ($ in millions) Total Debt • Acquired Infinite Integral Solutions Inc. effective July 19, 2019 for C$1.4 million (C$0.6 million paid $27.3 in Q2 FY20) $22.9 $24.7 $21.0 $19.1 • $18.9 million available from credit facility as of September 28, 2019 • 1.32
Slide 10: FY2020 Outlook – Building our Business for the Long Term
FY2020 Outlook* – Building our Business for the Long Term Service segment: Expect to continue to achieve strong organic growth in second half of FY20 and see results from productivity initiatives in our margins as the year progresses Distribution segment: Focus on higher value, higher margin opportu
Slide 11: Conference Call and Webcast Playback
Conference Call and Webcast Playback • Replay Number: 412-317-6671 passcode: 13694759 • Telephone replay available through Wednesday, October 30, 2019 • Webcast / Presentation / Replay available at http://www.transcat.com/investor-relations/ • Transcript, when available, at http://www.transcat.com/i
Slide 12: Supplemental Information
Supplemental Information 12
Slide 13: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation ($ in thousands) Q2 FY20 FY 2016 FY 2017 FY 2018 FY 2019 TTM Net Income $ 4,124 $ 4,522 $ 5,922 $ 7,145 $ 8,326 + Interest 247 719 1,018 903 987 + Other Expense / (Income) 48 51 60 91 169 + Tax Provision 1,883 2,642 2,026 2,090 1,563 Operating Income $ 6,302 $ 7,934 $
Slide 14: Segment Adjusted EBITDA Reconciliation
Segment Adjusted EBITDA Reconciliation ($ in thousands) Q2 FY20 FY 2016 FY 2017 FY 2018 FY 2019 TTM Service Operating Income $ 4,155 $ 4,769 $ 5,158 $ 5,202 $ 5,584 +Depreciation & Amortization 3,216 4,660 4,397 4,754 4,915 +Other (Expense) / Income (64) (55) (61) (69) (16) +Noncash Stock Compensati