Slide 1: Financial Results Q2 Fiscal 2022
Financial Results Q2 Fiscal 2022 Lee D. Rudow President and CEO Mark A. Doheny Chief Financial Officer TRANSGAT Trust in every measure
Slide 2: Safe Harbor Statement
TRANSCAT rusts ny esse 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
Slide 3: Q2 FY22 Summary
TRANSCAT rusts ony nssue Q2 FY22 Summary Revenue up 21.1% to second quarter record $50.4M Consolidated Gross margin expanded 140 basis points to 29.0% Results Adjusted EBITDA increased 36% from prior year to $7.1 million Net income of $3.0M or $0.40 per diluted share 14.0% organic revenue growth; to
Slide 4: Revenue
Revenue (8 in millions) Q2 Consolidated $41.6 $50.4 2.2021 Q2.2022 Consolidated revenue up 21.1% with broad-based strength across both operating segments Service organic growth remained strong at 14.0%; total revenue growth of 20.3% Distribution revenue up 22.2% on improved demand, with particular s
Slide 5: Gross Profit and Margin
TRANSCAT ‘rte nose Gross Profit and Margin (8 in millions) Q2 Consolidated Q2 Service Scamentare $14.6 $11.5 “ 27.6% 29.0% 1 Q2 2021 Q2 2022 Q2 2021 Q2 2022 Q2 Distribution Segment Consolidated gross margin expanded 140 basis points Service gross margin of 32.9% expanded 70 basis points $4.9 largely
Slide 6: Operating Income
TRANSAT stinovry noasure Operating Income ($ in millions) Q2 Consolidated Q2 Service Segment $3.6 $3.0 can $2.6 7.4% 7.1% i Q2 2021 Q2 2022 Q22021 Q2 2022 Q2 Distribution Segment Consolidated operating income of $3.6 million, up 16% from prior year Consolidated and Service operating income impacted
Slide 7: Net Income & Diluted EPS
TRANSCAT tiustin every measure Net Income & Diluted EPS (Sin millions, except EPS) Net Income Diluted EPS $3.0 $2.0 $0.40 $0.27 Q2 2021 Q2 2022 ; Q2 2021 Q2 2022 Q2 FY22 included discrete tax benefits due to tax accounting associated with stock option activity Now expect full fiscal 2022 tax rate to
Slide 8: Adjusted EBITDA and Margin
TRANSCAT ‘rte nose Adjusted EBITDA* and Margin (8 in millions) C lidated Qui@aeeiGEnS Q2 Service Segment $7.1 $5.5 $5.2 $4.5 14.0% 22021 Q2 2022 Q2. 2021 Q2.2022 Q2 Distribution Segment Consolidated adjusted EBITDA of $7.1M up 36% Service segment adjusted EBITDA margin expanded 30 basis points to 18
Slide 9: Operating Free Cash Flow
. TRANSCAT rts nn nse Operating Free Cash Flow (Sin millions) Six Months Ended Net cash provided by operations $75 $12.5 Gentil ipliire megs iEEBeL working capital increase to support growth ante ermendietrest (nex) (3.8) (3.1) capital expenditures focused on technology, Service segment capabilities
Slide 10: Balance Sheet Supports Growth Strategy
TRANSAT stinovry noasure Balance Sheet Supports Growth Strategy (Sin millions) PITALIZATION Cash and cash equivalents $ 26 $ 0.6 Total debt 43.0 ile} Total net debt 40.4 18.9 Shareholders’ equity 80.7 75.1 Total capitalization $ 123.7 $ 94.6 Debt/total capitalization 34.8% 20.6% Net debt/net total c
Slide 11: NEXA Enterprise Asset Management
TRANSCAT ustin ove measure NEXA Enterprise Asset Management " + NEXA Enterprise Asset Management acquired on August 31, 2021 * One-time transaction costs of $0.8 million included in FY22 Q2 operating expenses * Acquisition purchase accounting impact in first 12 months of ownership (Year 1) include $
Slide 12: Outlook
TRANSCAT tiustin every measure Outlook* Q3 FY 2022 Service segment: expect revenue growth to be similar to the second quarter of FY22, with roughly half of the growth to come organically and the other half coming from acquisition. We expect gross margin to expand over the prior year third quarter, s
Slide 13: Conference Call and Webcast Playback
TRANSCAT srstin overy moasure Conference Call and Webcast Playback * Replay Number: 412-317-6671 passcode: 13724485 Telephone replay available through Wednesday, November 10, 2021 * Webcast / Presentation / Replay available at * Transcript, when available, at
Slide 14: Supplemental Information
Supplemental Information TRANSGAT Trust in every measure
Slide 15: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation TRANSAT stinovry noasure ($ in thousands) FY2017_ _FY2018 _FY2019 —FY2020 «= FY2021_ «=~ FY2022Q1 FY 202202 Net Income $ 4522 $ 5,922 $7,145 $ 8067 $7,791 $ 3,688 $ 3,015 +Interest Expense 79 1,018 903 934 850 189 169 +Other (Expense) / Income 51 60 91 186 241 6 81 +Ta
Slide 16: Segment Adjusted EBITDA Reconciliation
TRANSCAT tty ess Segment Adjusted EBITDA Reconciliation ($ in thousands) FY2017__-FY2018_——_—=FY2019_—_—FY 2020 ~—_—=FY2021_—«-FY.2022Q1-FY2022Q2 Service Operating Income $ 47609 § 5158 § 5202 $ 5672 $ 10481 $ 2974 § 2,647 +Depreciation & Amortization 4,660 4,397 4,754 4,929 5,597 1,488 1,634 +Restr