Slide 1: Q4 and Full Year 2023 Financial Results Conference Call
inTEST Corporation Q4 and Full Year 2023 Financial Results Conference Call Nick Grant, President and CEO Duncan Gilmour, CFO and Treasurer March 27, 2024
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. These statements do not convey historical information but relate to predicted or potential future events and financial results, suc
Slide 3: Execution of 5-Point Strategy Driving Results
Execution of 5-Point Strategy Driving Results 5-Point Strategy ➢ 2023 results reflect commitment and effective execution of Five-Point Strategy ▪ Market diversification provided strength in sales Global & Innovation & ▪ Expanded customer base and expanded geographic reach Market Differentiation Expa
Slide 4: Diversification Efforts are Paying Off
Diversification Efforts are Paying Off Focused on target markets with strong, secular tailwinds inTEST Revenue by Market $123.3M $116.8M $84.9M 53% 2022 59% 2023 2021 65% Semi Industrial Defense/Aero Auto/EV Life Sciences Security Other 4
Slide 5: Revenue
Revenue ($ in millions) Years Quarters ➢ Record revenue in 2023 of $123.3 million, up $6.5 million, or 6% $32.4 $116.8 $123.3 $27.9 ➢ 2023 versus 2022 comparison: $84.9 ▪ Driven by $5.5 million increase in defense/aero, or 79% $53.8 ▪ Increase in industrial market of $4.3 million, or 43% 2020 2021 2
Slide 6: Gross Profit and Margin
Gross Profit and Margin ($ in millions) Years Quarters ➢ 2023 gross profit increased $3.5 million ▪ Gross margin expanded 50 bps y/y to 46.2% $15.0 on higher volume, favorable mix and ongoing $57.0 $53.4 pricing and cost actions $12.4 $41.2 ➢ Q4 gross profit of $12.4 million decreased $2.5 million y
Slide 7: Operating Expenses
Operating Expenses Continuing to invest to support 5-Point Strategy for Growth ($ in millions) Operating expenses as a % of sales ➢ 2023 operating expenses up $3.8 million y/y, and increased as a percent of sales 47.0% 38.6% 36.6% 37.7% 33.8% 40.7% 110 bps to 37.7% Years Quarters ▪ Increase included
Slide 8: Earnings and Adjusted EBITDA
Earnings and Adjusted EBITDA(1) ($ in millions, except per share data) Net Earnings and Adjusted EBITDA/ (1) (1) EPS and Adjusted EPS Adjusted EBITDA Margin Quarters Quarters $5.3 $0.34 $0.30 $3.2 $0.16 $2.4 $0.12 $1.5 16.2% 8.7% Q4 22 Q4 23 Q4 22 Q4 23 Years Years $16.0 $15.8 $0.99 $0.94 $0.81 $12.
Slide 9: Capital Structure and Cash Flow
Capital Structure and Cash Flow ($ in millions) Year Year Capitalization Cash Flow Ended Ended 12/31/23 12/31/22 12/31/23 12/31/22 Cash and cash equivalents $ 45.3 $ 13.4 Net cash provided by (used in) operating $ 16.2 $ (1.4) activities Total debt $ 12.0 $ 16.1 Capital expenditures (1.3) (1.4) Shar
Slide 10: Orders and Backlog
Orders and Backlog(1) ($ in millions) Orders ➢ Q4 orders down 12% y/y, up 2% sequentially Years Quarters $129.6 $31.3 ▪ Defense/aerospace orders strong y/y and $116.6 sequentially, up 53% and 70%, respectively $101.9 $27.5 ▪ Industrial orders recovered in the fourth quarter, up $59.7 30% y/y and mor
Slide 11: Outlook for 2024
Outlook for 2024 ➢ First Quarter Outlook(1) Revenue: ~$29 million 5-Point Strategy Gross margin: 45% to 46% Operating expenses: ~$13 million Intangible asset amortization expense: ~$0.6 million Amortization (after tax): ~$0.5 million (or ~$0.04 per share) Global & Innovation & Effective tax rate: 16
Slide 12: Building On Our Vision
Building On Our Vision Acquisition Strategy: Scaling Divisions Electronic Test ▪ Broader and complementary technology/applications ▪ Diversify outside of Semi market ▪ Deepen geographic market reach in Europe/Asia ▪ Expands customer base Environmental Technologies ▪ Higher growth markets and complem
Slide 13: Executing to Plan
Executing to Plan ($ in millions) 25 $200 to $250 2 0 0 to Potential Future R 202 Acquisitions + C AG ~30% $145 to $155 $117 $123 $85 $54 2020 2021 2022 2023 2024E 2025E Actual Revenue Estimated Revenue(1) (1) Estimated revenue, including estimated revenue from future potential acquisitions, is base
Slide 14: Driving Scale to Deliver Growth in Earnings
Driving Scale to Deliver Growth in Earnings ($ in millions) Division Operating Income(1) Adjusted EBITDA(2) Net Earnings ~ $40 + ~ $30 + ~ $20+ - $22 $23 + $19 $16 $16 $12 $9 $8 $7 22% 19% 20% ~20% 14% 14% 13% ~15% 9% 7% 8% ~10% ∕∕ (3) ∕∕ ∕∕ 2021 2022 2023 2025E 2021 2022 2023 2025E (3) 2021 2022 20
Slide 15: Execution on Track with Plan
Execution on Track with Plan Innovative technologies leveraging engineering expertise Diversified end markets with strong secular growth drivers Growing customer base, deepening customer reach and expanding geographically Financial flexibility to execute growth strategy Executing 5-Point Strategy an
Slide 16: Conference Call Playback Info / Upcoming Event
Conference Call Playback Info ➢ Replay Number: (412) 317-6671 passcode: 13745436 ➢ Telephone replay available through Thursday, April 4, 2024 ➢ Webcast / Presentation / Replay available at www.intest.com/investor-relations ➢ Transcript, when available, at www.intest.com/investor-relations Upcoming E
Slide 17: Supplemental Information
inTEST Corporation Q4 and Full Year 2023 Financial Results Conference Call Supplemental Information March 27, 2024
Slide 18: Reconciliation of Net Earnings to Adjusted Net Earnings and EPS
Reconciliation of Net Earnings to Adjusted Net Earnings (Non-GAAP) and Earnings Per Diluted Share to Adjusted Earnings Per Diluted Share (Non-GAAP) ($ in thousands, except per share amounts) Three Months Ended 12/31/2022 3/31/2023 6/30/2023 9/30/2023 12/31/2023 Net earnings $ 3,244 $ 2,817 $ 2,793 $
Slide 19: Reconciliation of Net Earnings to Adjusted Net Earnings and EPS (Years)
Reconciliation of Net Earnings to Adjusted Net Earnings (Non-GAAP) and Earnings Per Diluted Share to Adjusted Earnings Per Diluted Share (Non-GAAP) ($ in thousands, except per share amounts) Years Ended 12/31/2020 12/31/2021 12/31/2022 12/31/2023 Net earnings (loss) $ (895) $ 7,283 $ 8,461 $ 9,342 A
Slide 20: Reconciliation of Net Earnings to Adjusted EBITDA (Quarters)
Reconciliation of Net Earnings and Net Margin to Adjusted EBITDA (Non-GAAP) and Adjusted EBITDA Margin (Non-GAAP) ($ in thousands) Three Months Ended 12/31/2022 3/31/2023 6/30/2023 9/30/2023 12/31/2023 Net earnings $ 3,244 $ 2,817 $ 2,793 $ 2,277 $ 1,455 Acquired intangible amortization 552 544 523
Slide 21: Reconciliation of Net Earnings to Adjusted EBITDA (Years)
Reconciliation of Net Earnings and Net Margin to Adjusted EBITDA (Non-GAAP) and Adjusted EBITDA Margin (Non-GAAP) ($ in thousands) Years Ended December 31, 2020 2021 2022 2023 Net earnings (loss) $ (895) $ 7,283 $ 8,461 $ 9,342 Acquired intangible amortization 1,233 1,440 2,694 2,095 Net interest ex
Slide 22: Reconciliation of Q1 2024 Estimated EPS to Adjusted EPS
Reconciliation of First Quarter 2024 Estimated Earnings Per Diluted Share to Estimated Adjusted Earnings Per Diluted Share (Non-GAAP) Q1 2024E Estimated earnings per diluted share $ 0.06 Estimated acquired intangible amortization 0.05 Estimated tax adjustments (0.01) Estimated adjusted earnings per
Slide 23: Segment Reporting
Segment Reporting ($ in thousands) Three Months Ended Years Ended 12/31/2022 3/31/2023 6/30/2023 9/30/2023 12/31/2023 12/31/2022 12/31/2023 Electronic Test $ 11,236 $ 10,371 $ 10,993 $ 11,547 $ 8,105 $ 40,219 $ 41,016 Environmental Technologies 8,041 8,042 8,136 7,000 7,623 30,172 30,801 Process Tec