Transcat, Inc. · NASDAQ:TRNS
Transcat — Oppenheimer Virtual Conference 2021
28 slides from Transcat's conference presentation, Aug 11, 2021
Slide 1: Oppenheimer Virtual Conference
August 11 . . 3021 | Oppenheimer Virtual Conference Lee D. Rudow President and CEO Mark A. Doheny Chief Financial Officer TRANSGAT tists ver noasiro
Slide 2: Safe Harbor Statement
TRANSCAT ‘Trust in every measure 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 a
Slide 3: A Leader in the Calibration & Laboratory Instrument Service Market
Nasdaq: TRNS TRANSCAT iustin overy moasure A Leader in the Calibration & Laboratory Instrument Service Market and Value-Added Distributor of Test, Measurement & Control Instrumentation Service segment is our primary growth engine Leverage technology to increase productivity Long-term operating earni
Slide 4: Two Complementary Segments
Two Complementary Segments Service - Solid organic growth with a focus on regulated industries, including Life Science - Recurring revenue stream - Driven by regulation and the high cost of failure - Strong operating leverage Distribution - New test equipment = Rentals and used equipment - Leads for
Slide 5: Strategic Plan Pillars
TRANSCAT tern nese Strategic Plan Pillars oinsaio lo (io) a1 Olnswil Organic Acquired Leverage Leverage Service Growth| Growth Distribution Technology Mid- to high-single To drive double-digit Lead generation Improve process and digit growth Service growth productivity to enhance margins © 2021 Tran
Slide 6: Flexible Service Value Proposition and Locations
TRANSCAT ‘rustin every measure Flexible Service Value Proposition 22 Locations to Serve Customers in the U.S., Canada and Puerto Rico Flexible Service Delivery Options: Y — lient-based lab rerio Y Periodic on-site Y Mobile v In-house Y Pickup & Delivery ry Denver oc Angeles @ son Digs @ Phoenix Map
Slide 7: Client-Based Laboratories Locations
TRANSCAT tn cnn nce Client-Based Laboratories (“CBL’) 20 Locations Serving Customer Tailored Needs, Full Time At Their Location (@rtesea Devce o.. iiiinin 2... ee. - etc Deve @ Oram Medical Device Pam @ erarma no name @ ‘Aerospace & Defense Cnormet etl 8 inom ‘Map Legend @ Transcat Headquarters e =
Slide 8: Broad and Diverse Blue Chip Customer Base
TRANSCAT tern nese Broad and Diverse Blue Chip Customer Base Percentage of Service Revenue* 5% Chemical/Process 6% Energy/Utilities 11% Aerospace/Defense 11% Services 15% _ Industrial 4% Other 48% Life Science / FDA-regulated perce EB LECONMED —folinonafotimnon © 2021 Transcat Inc. * Company estimat
Slide 9: Taking Market Share
Taking Market Share $1.6 Billion Addressable Calibration Services Market’ 41% 3" Party Service Providers 34% In-house Laboratories + Estimated Addressable North American Calibration Market 2 Percentage of Revenue (North America), Company estimates © 2021 Transcat Inc. TRANSCAT ‘rustin ovry messure M
Slide 10: Financial Results
Financial Results
Slide 11: Consolidated Results
TRANSAT ‘tistin every ‘Measure Consolidated Results (Sin millions) Revenue Operating Income gi7a.a_ $173.3 $1822 gua $1552 $160.9 $13.8 . g10.2 $10.8 $112 $9.0 ' Eb ' FY 2017 FY2018 FY 2019 FY2020 FY2021 Q1FY22 FY2017 FY2018 FY2019 FY2020 FY2021 Q1FY22 TIM TIM i Distribution [J Service © 2021 Transc
Slide 12: Service Segment Driving Strong Results
TRANSCAT 11:3: ‘In every measure Service Segment Driving Strong Results ($ in millions) Service Revenue 101,3 $105.9 0 993.0 G 20% total revenue growth in Q1 FY22, 16.6% organic growth gria $77.4 8 $36.4 i FY 2012 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 Q1 FY22 Capturing share in highly-regulated en
Slide 13: Distribution Supports Growth Strategy
TRANSCAT ustin evry messure Distribution Supports Growth Strategy ($ in millions) Distribution Sales $80.1 $77.7 $76.9 $76.4 $72.8 $72.1 FY2017 FY2018 FY 2019 FY2020 FY2021 Q1FY22 TIM Distribution Operating Income & a cy [. ss $1.5 FY2017 FY2018 FY2019 FY2020 FY 2021 ar nize © 2021 Transcat Inc. Bus
Slide 14: Strong Cash Generation
Strong Cash Generation (Sin millions) Net Income and Diluted EPS $10.7 $8.1 $7.8 $1.41 FY 2017 FY2018 FY2019 FY2020 FY2021 QiFY22 T™M Adjusted EBITDA’ and Margin $23.2 $20.6 17.8 $18.4 giea § $14.5 12.7% FY2017 FY2018 FY 2019 FY2020 FY2021 Q1FY22 TIM © 2021 Transcat Inc. TRANSCAT ustin evry messure
Slide 15: Financial Flexibility Supports Growth Strategy
© 2021 Transcat Inc. TRANSCAT 11:3: ‘in every measure Financial Flexibility Supports Growth Strategy ($ in millions) Total Debt 0.96x leverage ratio at quarter-end %-- Debt to Total Capitalization (Total debt to TTM Adjusted EBITDA’) $30.3 $22.9 $210 S196 $22.2 Amended credit facility on July 7, 202
Slide 16: Growth Strategy
Growth Strategy
Slide 17: What makes Transcat Unique
TRANSCAT ustin evry messure What makes Transcat Unique Why We Win... Rental & Used Instruments Lead Generation For Service Segment Core Distribution 50 years — Strong Brands and Name Recognition Certifications of New Equipment Service Growth * Calibration * Validation & Analytical * Consulting © 202
Slide 18: Leverage Technology as a Competitive Advantage
TRANSCAT ustin evry messure Leverage Technology as a Competitive Advantage Digital Transformation With industry leading web domain authority Proprietary “C3” Portal for customer asset management Trust in every measure Operational Excellence Productivity focus Lean/best practices Process automation B
Slide 19: Our C3 Advantage
Our C3 Advantage © 2021 Transcat Inc. Transcat Admin Proprietary “C3” Portal for customer asset management TRANSCAT ‘ustin every measure 19
Slide 20: Drive Double-Digit Service Growth
TRANSCAT ‘tiustin every measure Drive Double-Digit Service Growth Our focus on Life Science sector Organic Growth Dominate our local markets Strategy Take market share from 34 party providers and OEMs Outsourcing of in-house labs Continued expansion of pipettes, RF microwave and high-end electronics
Slide 21: Acquisition Drivers
TRANSCAT tern nese Acquisition Drivers Increased Geographic Capabilities and Leveraged Expansion Expertise Infrastructure Upstate Metrology BioTek Services, Inc. v TTE Laboratories (pipettes.com) Infinite Integral Solutions (CalTree software) Gauge Repair Service © 2021 Transcat Inc. 21
Slide 22: Outlook
TRANSAT ‘tistin every ‘measure Outlook* Q2 FY 2022 Service segment: expect organic revenue growth to be similar to what we achieved in the trailing first quarter fiscal 2022; more modest improvement in gross margin compared to the last several quarters due to a more difficult technician productivity
Slide 23: Calibrated
CALIBRATED
Slide 24: Supplemental Information
Supplemental Information
Slide 25: Executing Acquisition Strategy
TRANSCAT tustin every ‘measure Executing Acquisition Strategy CYAngers infin tof egral = SBIOTEKeewvces Instrumentation, Inc. mee Soe a A TRANSEAT Company FY 2019 FY 2020 FY 2021 FY 2022 NBS ENED UpState Calibrations, Inc. Gauge Repair Service Metrology ATmewor COMPANY 3°: tte laboratories” © 2021 T
Slide 26: Seasoned Executive Team Driving Growth
TRANSCAT ‘Trust in every measure Seasoned Executive Team Driving Growth Lee D. Rudow = 30+ years of industry experience President and = Demonstrated growth record Chief Executive Officer = Joined Transcat in 2011 LeanneE. Branham — = 30+ years of operations, fulfillment and Michael W. West = 15+ yea
Slide 27: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation (Sin thousands) FY 2018 FY 2019 Fy 2020 TRANSCAT ustin evry messure Fy2021_ FY 2022Q1 Net Income $ 5922 $ 7,145 $ 8067 $ 7,791 $ 3,688 +Interest Expense 1,018 903 934 850 189 +Other (Expense) / Income 60 91 186 241 6 +Tax Provision 2,026 2,090 1,663 2,191 (194) Operati
Slide 28: Segment Adjusted EBITDA Reconciliation
TRANSCAT ‘tiustin every measure Segment Adjusted EBITDA Reconciliation (Sin thousands) FY 2019 Service Operating Income $5,202 +Depreciation & Amortization 4,754 +Restructuring Expense - - - +Other (Expense) / Income (55) 4+Noncash Stock Compensation _217 Service Adjusted EBITDA Distribution Operati