Transcat, Inc. · NASDAQ:TRNS

Transcat — Shareholder Meeting (September 2018)

21 slides from Transcat's shareholder meeting presentation, Sep 12, 2018

1. Slide 1: Annual Meeting of Shareholders

   Sept 12 2018 Annual Meeting of Shareholders Lee D. Rudow President and CEO Nasdaq: TRNS 1

2. 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

3. Slide 3: Welcome Shareholders

   Welcome Shareholders EXECUTIVE & SENIOR MANAGEMENT TEAM Lee D. Rudow President and Chief Executive Officer Michael J. Tschiderer Chief Financial Officer Scott D. Deverell Corporate Controller & Principal Accounting Officer Benjamin P. Hawley Vice President of Operational Excellence Robert A. Flack V

4. Slide 4: Average Trading Volume & Stock Trends

   Average Trading Volume & Stock Trends © 2018 Transcat Inc. 4

5. Slide 5: Research Coverage

   Research Coverage © 2018 Transcat Inc. 5

6. Slide 6: Record Consolidated Results

   Record Consolidated Results ($ in millions) Consolidated Revenue Consolidated Operating Income $9.6 $155.1 $155.5 $9.0 $143.9 $7.9 $123.6 $122.2 $6.8 $6.3 FY 2015 FY 2016 FY 2017 FY 2018 Q1 FY19 FY 2015 FY 2016 FY 2017 FY 2018 Q1 FY19 TTM TTM Distribution Service © 2018 Transcat Inc. CAGR calculated

7. Slide 7: Service Segment Continues to Deliver

   Service Segment Continues to Deliver ($ in millions) Service Revenue Taking market share $71.1 $77.4 $78.3 $51.8 $59.2 $36.4 Inflection 37 consecutive quarters of Point YOY revenue growth: 9+ years FY 2012 FY 2015 FY 2016 FY 2017 FY 2018 Q1 FY19 TTM Service Operating Income & Margin Revenue: +8% (YO

8. Slide 8: Improved Distribution Margins

   Improved Distribution Margins ($ in millions) Distribution Sales Higher demand from core $77.7 $77.2 customers $71.8 $72.8 $63.0 Growing rental business Investments in e-commerce capabilities and web-based FY 2015 FY 2016 FY 2017 FY 2018 Q1 FY19 marketing TTM Distribution Operating Income Margin dri

9. Slide 9: Strong Cash Generation and Record Net Income

   Strong Cash Generation and Record Net Income ($ in millions) Net Income Tax rate expectations2 $6.5 Fiscal 2019: 25% to 27% $5.9 $4.1 $4.5 (includes Federal, various state, and Canadian income taxes) $4.0 Diluted $0.57 $0.58 $0.64 $0.81 $0.88 EPS Adjusted EBITDA CAGR3 FY 2015 FY 2016 FY 2017 FY 2018

10. Slide 10: Financial Flexibility Supports Growth Strategy

    Financial Flexibility Supports Growth Strategy ($ in millions) Total Debt $22.0 million available from credit facility % - Debt to Total Capitalization as of June 30, 2018 $27.3 1.28x leverage ratio at Q1 FY 2019 $22.9 $21.5 $19.1 (Total debt to TTM Adjusted EBITDA¹) $12.2 $50.0M shelf registration

11. Slide 11: Market, Strategy and Outlook

    Market, Strategy and Outlook 11

12. Slide 12: What makes Transcat Unique

    What makes Transcat Unique Why We Win… Rental & Used Instruments Lead Generation For Service Segment Core Distribution 50 years – Strong Brand Recognition Certifications of New Equipment Service Growth • Calibration • Validation & Analytical • Consulting © 2018 Transcat Inc. 12

13. Slide 13: Leverage Technology as a Competitive Advantage

    Leverage Technology as a Competitive Advantage Digital Transformation With industry leading web domain authority Proprietary “C3” Portal for customer asset management Operational Excellence Productivity focus Lean/best practices Process automation © 2018 Transcat Inc. 13

14. Slide 14: Drive Double-Digit Service Growth

    Drive Double-Digit Service Growth • Dominate our local markets Organic Growth Strategy • Take market share from 3rd party providers and OEMs • Outsourcing of internal labs • Geographic expansion Acquisition • Increased capabilities Strategy and expertise • Bolt-on/leverage infrastructure • Sweet spo

15. Slide 15: Executing Acquisition Strategy

    Executing Acquisition Strategy FY 2016 FY 2017 FY 2018 FY 2019 © 2018 Transcat Inc. 15

16. Slide 16: Acquisitions and Integrations

    Acquisitions and Integrations 21 Locations to Serve Customers in the U.S., Canada and Puerto Rico Montreal Dispersion Ottawa Boston Portland Toronto Rochester Milwaukee Pittsburgh Philadelphia Harrisburg Ft. Wayne Angel’s Instrumentation (Norfolk) Dayton St. Louis Denver Charlotte Los Angeles Excali

17. Slide 17: Building for the Long Term

    Building for the Long Term Organic Service Growth Strategic Acquisitions Leverage Technology, Processes & People to Improve Productivity Leverage Distribution & Strong Value Proposition © 2018 Transcat Inc. 17

18. Slide 18: Annual Meeting of Shareholders

    Sept 12 2018 Annual Meeting of Shareholders Nasdaq: TRNS 18

19. Slide 19: Supplemental Information

    Supplemental Information 19

20. Slide 20: Adjusted EBITDA Reconciliation

    Adjusted EBITDA Reconciliation ($ in thousands) 1QFY19 FY 2015 FY 2016 FY 2017 FY 2018 TTM Net Income $ 4,026 $ 4,124 $ 4,522 $ 5,922 $6,494 + Interest 234 247 719 1,018 988 + Other Expense / (Income) 111 48 51 60 44 + Tax Provision 2,397 1,883 2,642 2,026 2,115 Operating Income $ 6,768 $ 6,302 $ 7,

21. Slide 21: Segment Adjusted EBITDA Reconciliation

    Segment Adjusted EBITDA Reconciliation ($ in thousands) 1QFY19 FY 2015 FY 2016 FY 2017 FY 2018 TTM Service Operating Income $ 3,693 $ 4,155 $ 4,769 $ 5,158 $ 5,342 +Depreciation & Amortization 2,362 3,216 4,660 4,397 4,477 +Other (Expense) / Income (138) (64) (55) (61) (47) +Noncash Stock Compensati

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