Transcat Reports Strong First Quarter Results on Double-Digit Organic Service Growth and Expanding Gross Margins

About this update from Transcat, Inc.

First quarter consolidated revenue up 10.9% with 160 basis points gross margin expansion First quarter service revenue up 17.6%, service organic revenue growth of 11.2% First quarter service gross profit increased 19.7%; service gross margin expanded 50 basis points First quarter consolidated adjusted EBITDA grew 16.1% with adjusted EBITDA margin expanding 60 basis points ROCHESTER, N.Y. --(BUSINESS WIRE)-- Transcat, Inc. (Nasdaq: TRNS) (“Transcat” or the “Company”), a leading provider of accredited calibration, repair, inspection and laboratory instrument services and value-added distributor of professional grade handheld test, measurement, and control instrumentation, today reported financial results for its first quarter ended June 24, 2023 (the “first quarter”) of fiscal year 2024, which ends March 30, 2024 (“fiscal 2024”). Results include the previously reported acquisitions of Charlton Jeffmont Inc. , Raitz Inc. and Toolroom Calibration Inc. (d/b/a Alliance Calibration) (“Alliance”) effective May 31, 2022 , e2b Calibration ("e2b"), effective September 27, 2022 , Galium Limited (d/b/a Complete Calibrations) ("Complete Calibrations"), effective September 28, 2022 and TIC-MS, Inc. ("TIC-MS") effective March 27, 2023 . “We are extremely pleased with our strong first quarter results, as double-digit organic Service revenue growth of 11% and increased productivity throughout our network of labs drove higher than expected Service gross margin. Service segment revenue grew 18% as demand in our highly regulated end markets, including life sciences, remained strong and our recent acquisitions continued to perform at a high level. Consolidated revenue was up 11% with gross margins expanding 160 basis points year over year as our diverse and unique value proposition continues to resonate well in the market and is resilient in times of economic uncertainty” commented Lee D. Rudow , President and CEO. “The Transcat Team continues to execute and deliver strong performance over time. Adjusted EBITDA growth of 16% for the first quarter is a testament to the successful execution of our automation and process improvement initiatives and our ability to leverage organic Service revenue growth.” “The Distribution segment also performed very well in the first quarter with gross margins expanding 270 basis points to 27.7%, driven primarily by strong performance in the high-margin rental business. The growing rental business has remained strong through various economic cycles and provides diversification to the Distribution portfolio. In addition to the strong first quarter financial performance, the Distribution/Rental business is an important component of lead generation for the Service segment” stated Mr. Rudow . Mr. Rudow added, “Acquisitions continue to be an important part of our overall growth strategy. We added St. Louis -based TIC-MS, Inc. at the beginning of the quarter and are very pleased with its performance-to-date. Our future plan is to co-locate the existing St. Louis lab with TIC-MS, leveraging the infrastructure synergies of one lab location to drive efficiencies. Additionally, earlier this month we acquired SteriQual a provider of expert consulting services to the life sciences industry that specializes in commissioning, qualification, and validation (“CQV”). SteriQual is a strategic “bolt-on” to the NEXA Enterprise Asset Management business and is the first acquisition that further builds out our Professional Services footprint.” First Quarter Fiscal 2024 Review (Results are compared with the first quarter of the fiscal year ended March 25, 2023 (“fiscal 2023”)) ($ in thousands) Change FY24 Q1 FY23 Q1 $'s % Service Revenue $ 39,853 $ 33,876 $ 5,977 17.6 % Distribution Sales 20,745 20,785 (40 ) (0.2 )% Revenue $ 60,598 $ 54,661 $ 5,937 10.9 % Gross Profit $ 18,710 $ 16,038 $ 2,672 16.7 % Gross Margin 30.9 % 29.3 % Operating Income $ 4,640 $ 3,604 $ 1,036 28.7 % Operating Margin 7.7 % 6.6 % Net Income $ 2,949 $ 3,072 $ (123 ) (4.0 )% Net Margin 4.9 % 5.6 % Adjusted EBITDA* $ 8,481 $ 7,307 $ 1,174 16.1 % Adjusted EBITDA* Margin 14.0 % 13.4 % Diluted EPS $ 0.38 $ 0.40 $ (0.02 ) (5.0 )% Adjusted Diluted EPS* $ 0.52 $ 0.54 $ (0.02 ) (3.7 )% *See Note 1 on page 5 for a description of these non-GAAP financial measures and pages 10, 11 and 12 for the reconciliation tables. Consolidated revenue was $60.6 million , an increase of 10.9%. Consolidated gross profit was $18.7 million , an increase of $2.7 million , or 16.7%, while gross margin expanded 160 basis points due to improvements in both operating segments. Operating expenses were $14.1 million , an increase of $1.6 million , or 13.2%, driven by incremental expenses from acquired businesses (including stock-based compensation expense) and higher incentive-based employee costs due to higher sales. Adjusted EBITDA was $8.5 million which represented an increase of $1.2 million or 16.1%. Net income per diluted share was $0.38 compared to $0.40 last year and adjusted diluted earnings per share was $0.52 versus $0.54 last year impacted by the stock-based tax benefit move from Q1 of last year to Q2 this year and higher interest expense. Service segment delivers strong first quarter results Represents the accredited calibration, repair, inspection and laboratory instrument services business (65.8% of total revenue for the first quarter of fiscal 2024). ($ in thousands) Change FY24 Q1 FY23 Q1 $'s % Service Segment Revenue $ 39,853 $ 33,876 $ 5,977 17.6 % Gross Profit $ 12,971 $ 10,835 $ 2,136 19.7 % Gross Margin 32.5 % 32.0 % Operating Income $ 3,192 $ 2,532 $ 660 26.1 % Operating Margin 8.0 % 7.5 % Adjusted EBITDA* $ 6,232 $ 5,473 $ 759 13.9 % Adjusted EBITDA* Margin 15.6 % 16.2 % *See Note 1 on page 5 for a description of this non-GAAP financial measure and pages 10 and 11 for the Adjusted EBITDA Reconciliation tables. Service segment revenue was $39.9 million , an increase of $6.0 million or 17.6%, and included $2.2 million of incremental revenue from acquisitions. Organic revenue growth was 11.2% and was driven by strong end market demand and continued market share gains. The segment gross margin increased 50 basis points from prior year primarily due to continued productivity improvements offset by increased start-up costs from new client-based lab implementations. Distribution segment shows continued margin improvement Represents the sale and rental of new and used professional grade handheld test, measurement and control instrumentation (34.2% of total revenue for the first quarter of fiscal 2024). ($ in thousands) Change FY24 Q1 FY23 Q1 $'s % Distribution Segment Sales $ 20,745 $ 20,785 $ (40 ) (0.2 )% Gross Profit $ 5,739 $ 5,203 $ 536 10.3 % Gross Margin 27.7 % 25.0 % Operating Income $ 1,448 $ 1,072 $ 376 35.1 % Operating Margin 7.0 % 5.2 % Adjusted EBITDA* $ 2,249 $ 1,834 $ 415 22.6 % Adjusted EBITDA* Margin 10.8 % 8.8 % *See Note 1 on page 5 for a description of this non-GAAP financial measure and pages 10 and 11 for the Adjusted EBITDA Reconciliation tables. Distribution sales were $20.7 million , relatively flat compared to prior year. Distribution segment gross margin was 27.7%, an increase of 270 basis points due to a favorable sales mix driven by strength in the Rentals business. Balance Sheet and Cash Flow Overview On June 24, 2023 , the Company had $37.5 million available for borrowing under its secured revolving credit facility. Total debt of $48.4 million was down $0.8 million from fiscal 2023 year-end due to increased cash flow from operations. The Company’s leverage ratio, as defined in the credit agreement, was 1.50 on June 24, 2023 , compared with 1.60 on March 25, 2023 . Outlook Mr. Rudow added, “We have demonstrated our ability to drive growth through various economic cycles as can be seen over the past decade and a half, and we are confident that will continue. During this fiscal year, we expect organic Service revenue growth in the high-single digit to low double-digit range and gross margin expansion. We believe our unique value proposition drives a sustainable competitive advantage in the highly regulated markets that we serve, particularly the Life Science, Aerospace, and Defense markets. Strategic, accretive acquisitions drive synergistic growth opportunities and will be a key component of our go-forward strategy.” Transcat expects its income tax rate to range between 21% and 23% in fiscal 2024. This estimate includes Federal, various state, Canadian and Irish income taxes and reflects the discrete tax accounting associated with share-based payment awards. Although the tax rate is consistent with recent years, there will be a difference in calendarization of the tax benefit from vesting of share-based payments in fiscal 2024. The tax benefits are normally realized in the fiscal first quarter, but we will see the benefit in the second quarter of fiscal 2024, due to a timing difference of when the awards were granted. This benefit will positively impact the tax rate by approximately 13% in the second quarter of fiscal 2024. Webcast and Conference Call Transcat will host a conference call and webcast on Tuesday, August 1, 2023 at 11:00 a.m. ET . Management will review the financial and operating results for the first quarter, as well as the Company’s strategy and outlook. A question and answer session will follow the formal discussion. The review will be accompanied by a slide presentation, which will be available at www.transcat.com/investor-relations . The conference call can be accessed by calling (201) 689-8471. Alternatively, the webcast can be monitored at www.transcat.com/investor-relations . A telephonic replay will be available from 2:00 p.m. ET on the day of the call through Tuesday, August 8, 2023 . To listen to the archived call, dial (412) 317-6671 and enter conference ID number 13740167, access the webcast replay at www.transcat.com/investor-relations , where a transcript will be posted once available. NOTE 1 – Non-GAAP Financial Measures In addition to reporting net income, a U.S. generally accepted accounting principle (“GAAP”) measure, we present Adjusted EBITDA (earnings before interest, income taxes, depreciation and amortization, non-cash stock compensation expense, acquisition related transaction expenses, non-cash loss on sale of building and restructuring expense), which is a non-GAAP measure. The Company’s management believes Adjusted EBITDA is an important measure of operating performance because it allows management, investors and others to evaluate and compare the performance of its core operations from period to period by removing the impact of the capital structure (interest), tangible and intangible asset base (depreciation and amortization), taxes, stock-based compensation expense and other items, which is not always commensurate with the reporting period in which it is included. As such, the Company uses Adjusted EBITDA as a measure of performance when evaluating its business segments and as a basis for planning and forecasting. Adjusted EBITDA is not a measure of financial performance under GAAP and is not calculated through the application of GAAP. As such, it should not be considered as a substitute for the GAAP measure of net income and, therefore, should not be used in isolation of, but in conjunction with, the GAAP measure. Adjusted EBITDA, as presented, may produce results that vary from the GAAP measure and may not be comparable to a similarly defined non-GAAP measure used by other companies. See pages 10 and 11 for the Adjusted EBITDA Reconciliation tables. In addition to reporting Diluted Earnings Per Share, a GAAP measure, we present Adjusted Diluted Earnings Per Share (net income plus acquisition related amortization expense, acquisition related transaction expenses, acquisition related stock-based compensation, acquisition amortization of backlog and restructuring expense), which is a non-GAAP measure. Our management believes Adjusted Diluted Earnings Per Share is an important measure of our operating performance because it provides a basis for comparison of our business operations between current, past and future periods by excluding items that we do not believe are indicative of our core operating performance. Adjusted Diluted Earnings Per Share is not a measure of financial performance under GAAP and is not calculated through the application of GAAP. As such, it should not be considered as a substitute or alternative for the GAAP measure of Diluted Earnings Per Share and, therefore, should not be used in isolation of, but in conjunction with, the GAAP measure. Adjusted Diluted Earnings Per Share, as presented, may produce results that vary from the GAAP measure and may not be comparable to a similarly defined non-GAAP measure used by other companies. See page 12 for the Adjusted Diluted EPS Reconciliation table. ABOUT TRANSCAT Transcat, Inc. is a leading provider of accredited calibration, reliability, maintenance optimization, quality and compliance, validation, Computerized Maintenance Management System (CMMS), and pipette services. The Company is focused on providing best-in-class services and products to highly regulated industries, particularly the Life Science industry, which includes pharmaceutical, biotechnology, medical device, and other FDA-regulated businesses, as well as aerospace and defense, and energy and utilities. Transcat provides periodic on-site services, mobile calibration services, pickup and delivery, in-house services at its 27 Calibration Service Centers strategically located across the United States , Puerto Rico , Canada , and Ireland . In addition, Transcat operates calibration labs in 21 imbedded customer-site locations. The breadth and depth of measurement parameters addressed by Transcat’s ISO/IEC 17025 scopes of accreditation are believed to be the best in the industry. Transcat also operates as a leading value-added distributor that markets, sells and rents new and used national and proprietary brand instruments to customers primarily in North America . The Company believes its combined Service and Distribution segment offerings, experience, technical expertise, and integrity create a unique and compelling value proposition for its customers. Transcat’s strategy is to leverage its strong brand and unique value proposition that includes its comprehensive instrument service capabilities, enterprise asset management, and leading distribution platform to drive organic sales growth. The Company will also look to expand its addressable calibration market through acquisitions and capability investments to further realize the inherent leverage of its business model. More information about Transcat can be found at: Transcat.com . Safe Harbor Statement This news release 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 statements are identified by words such as “expects,” “estimates,” “projects,” “anticipates,” “believes,” “could,” “plans,” “aims” and other similar words. All statements addressing operating performance, events or developments that Transcat expects or anticipates will occur in the future, including but not limited to statements relating to anticipated revenue, profit margins, the commercialization of software projects, sales operations, capital expenditures, cash flows, operating income, growth strategy, segment growth, potential acquisitions, integration of acquired businesses, market position, customer preferences, outlook and changes in market conditions in the industries in which Transcat operates are forward-looking statements. Forward-looking statements should be evaluated in light of important risk factors and uncertainties. These risk factors and uncertainties include those more fully described in Transcat’s Annual Report and Quarterly Reports filed with the Securities and Exchange Commission , including under the heading entitled “Risk Factors.” Should one or more of these risks or uncertainties materialize or should any of the Company’s underlying assumptions prove incorrect, actual results may vary materially from those currently anticipated. In addition, undue reliance should not be placed on the Company’s forward-looking statements, which speak only as of the date they are made. Except as required by law, the Company disclaims any obligation to update, correct or publicly announce any revisions to any of the forward-looking statements contained in this news release, whether as the result of new information, future events or otherwise. FINANCIAL TABLES FOLLOW. TRANSCAT, INC. CONSOLIDATED STATEMENTS OF INCOME (In Thousands, Except Per Share Amounts) (Unaudited) First Quarter Ended June 24 , June 25 , 2023 2022 Service Revenue $ 39,853 $ 33,876 Distribution Sales 20,745 20,785 Total Revenue 60,598 54,661 Cost of Service Revenue 26,882 23,041 Cost of Distribution Sales 15,006 15,582 Total Cost of Revenue 41,888 38,623 Gross Profit 18,710 16,038 Selling, Marketing and Warehouse Expenses 6,469 5,820 General and Administrative Expenses 7,601 6,614 Total Operating Expenses 14,070 12,434 Operating Income 4,640 3,604 Interest and Other Expense, net 878 156 Income Before Income Taxes 3,762 3,448 Provision for Income Taxes 813 376 Net Income $ 2,949 $ 3,072 Basic Earnings Per Share $ 0.39 $ 0.41 Average Shares Outstanding 7,622 7,535 Diluted Earnings Per Share $ 0.38 $ 0.40 Average Shares Outstanding 7,762 7,629 TRANSCAT, INC. CONSOLIDATED BALANCE SHEETS (In Thousands, Except Share and Per Share Amounts) (Unaudited) (Audited) June 24 , March 25 , 2023 2023 ASSETS Current Assets: Cash $ 2,149 $ 1,531 Accounts Receivable, less allowance for doubtful accounts of $515 and $457 as of June 24, 2023 and March 25, 2023 , respectively 42,356 44,698 Other Receivables 527 506 Inventory, net 15,177 16,929 Prepaid Expenses and Other Current Assets 3,393 3,935 Total Current Assets 63,602 67,599 Property and Equipment, net 30,186 29,064 Goodwill 77,051 69,360 Intangible Assets, net 15,144 13,799 Right To Use Assets, net 16,280 14,876 Other Assets 1,066 1,051 Total Assets $ 203,329 $ 195,749 LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Accounts Payable $ 11,564 $ 15,869 Accrued Compensation and Other Current Liabilities 9,290 10,201 Income Taxes Payable 601 - Current Portion of Long-Term Debt 2,270 2,248 Total Current Liabilities 23,725 28,318 Long-Term Debt 46,090 46,869 Deferred Tax Liabilities, net 7,184 6,538 Lease Liabilities 14,170 12,960 Other Liabilities 1,440 1,434 Total Liabilities 92,609 96,119 Shareholders' Equity: Common Stock, par value $0.50 per share, 30,000,000 shares authorized; 7,643,099 and 7,562,604 shares issued and outstanding as of June 24, 2023 and March 25, 2023 , respectively 3,822 3,781 Capital in Excess of Par Value 35,717 27,886 Accumulated Other Comprehensive Loss (718 ) (1,200 ) Retained Earnings 71,899 69,163 Total Shareholders' Equity 110,720 99,630 Total Liabilities and Shareholders' Equity $ 203,329 $ 195,749 TRANSCAT, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands) (Unaudited) First Quarter Ended June 24 , June 25 , 2023 2022 Cash Flows from Operating Activities: Net Income $ 2,949 $ 3,072 Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: Net Loss on Disposal of Property and Equipment 8 10 Deferred Income Taxes 44 (23 ) Depreciation and Amortization 2,790 2,641 Provision for Accounts Receivable and Inventory Reserves 138 88 Stock-Based Compensation Expense 930 828 Changes in Assets and Liabilities, net of acquisitions: Accounts Receivable and Other Receivables 3,115 1,578 Inventory 1,950 (2,118 ) Prepaid Expenses and Other Current Assets 531 432 Accounts Payable (4,315 ) (1,218 ) Accrued Compensation and Other Current Liabilities (1,203 ) (3,247 ) Income Taxes Payable 599 - Net Cash Provided by Operating Activities 7,536 2,043 Cash Flows from Investing Activities: Purchases of Property and Equipment (2,767 ) (2,399 ) Proceeds from Sale of Property and Equipment - 10 Business Acquisitions, net of cash acquired (2,869 ) (4,040 ) Net Cash Used in Investing Activities (5,636 ) (6,429 ) Cash Flows from Financing Activities: (Repayments of) Proceeds from Revolving Credit Facility, net (204 ) 3,816 Repayments of Term Loan (553 ) (490 ) Issuance of Common Stock 199 221 Repurchase of Common Stock (301 ) (437 ) Net Cash (Used in) Provided by Financing Activities (859 ) 3,110 Effect of Exchange Rate Changes on Cash (423 ) 323 Net Increase (Decrease) in Cash 618 (953 ) Cash at Beginning of Period 1,531 1,396 Cash at End of Period $ 2,149 $ 443 TRANSCAT, INC. Adjusted EBITDA Reconciliation Table (In thousands) (Unaudited) Fiscal 2024 Q1 Q2 Q3 Q4 YTD Net Income $ 2,949 $ 2,949 + Interest Expense 814 814 + Other Expense / (Income) 64 64 + Tax Provision 813 813 Operating Income $ 4,640 $ - $ - $ - $ 4,640 + Depreciation & Amortization 2,790 2,790 + Transaction Expense 185 185 + Other (Expense) / Income (64 ) (64 ) + Noncash Stock Compensation 930 930 Adjusted EBITDA $ 8,481 $ - $ - $ - $ 8,481 Segment Breakdown Service Operating Income $ 3,192 $ 3,192 + Depreciation & Amortization 2,226 2,226 + Transaction Expense 185 185 + Other (Expense) / Income (47 ) (47 ) + Noncash Stock Compensation 676 676 Service Adjusted EBITDA $ 6,232 $ - $ - $ - $ 6,232 Distribution Operating Income $ 1,448 $ 1,448 + Depreciation & Amortization 564 564 + Other (Expense) / Income (17 ) (17 ) + Noncash Stock Compensation 254 254 Distribution Adjusted EBITDA $ 2,249 $ - $ - $ - $ 2,249 TRANSCAT, INC. Adjusted EBITDA Reconciliation Table (In thousands) (Unaudited) Fiscal 2023 Q1 Q2 Q3 Q4 YTD Net Income $ 3,072 $ 2,357 $ 1,601 $ 3,658 $ 10,688 + Interest Expense 360 550 726 781 2,417 + Other Expense / (Income) (204 ) (13 ) 313 248 344 + Tax Provision 376 732 523 1,168 2,799 Operating Income $ 3,604 $ 3,626 $ 3,163 $ 5,855 $ 16,248 + Depreciation & Amortization 2,641 2,778 2,824 2,712 10,955 + Transaction Expense 30 - 96 59 185 + Other (Expense) / Income 204 13 (313 ) (248 ) (344 ) + Noncash Stock Compensation 828 1,114 815 620 3,377 Adjusted EBITDA $ 7,307 $ 7,531 $ 6,585 $ 8,998 $ 30,421 Segment Breakdown Service Operating Income $ 2,532 $ 2,507 $ 1,836 $ 4,547 $ 11,422 + Depreciation & Amortization 2,139 2,246 2,268 2,147 8,800 + Transaction Expense 30 - 96 59 185 + Other (Expense) / Income 134 3 (214 ) (170 ) (247 ) + Noncash Stock Compensation 638 793 576 456 2,463 Service Adjusted EBITDA $ 5,473 $ 5,549 $ 4,562 $ 7,039 $ 22,623 Distribution Operating Income $ 1,072 $ 1,119 $ 1,327 $ 1,308 $ 4,826 + Depreciation & Amortization 502 532 556 565 2,155 + Other (Expense) / Income 70 10 (99 ) (78 ) (97 ) + Noncash Stock Compensation 190 321 239 164 914 Distribution Adjusted EBITDA $ 1,834 $ 1,982 $ 2,023 $ 1,959 $ 7,798 TRANSCAT, INC. Adjusted Diluted EPS Reconciliation Table (In Thousands, Except Per Share Amounts) (Unaudited) Fiscal 2024 Q1 Q2 Q3 Q4 YTD Net Income $ 2,949 $ 2,949 + Amortization of Intangible Assets 1,093 1,093 + Acquisition Deal Costs 367 367 + Income Tax Effect at 25% (365 ) (365 ) Adjusted Net Income $ 4,044 $ - $ - $ - $ 4,044 Average Diluted Shares Outstanding 7,762 7,762 Diluted Earnings Per Share $ 0.38 $ - $ - $ - $ 0.38 Adjusted Diluted Earnings Per Share $ 0.52 $ - $ - $ - $ 0.52 Fiscal 2023 Q1 Q2 Q3 Q4 YTD Net Income $ 3,072 $ 2,357 $ 1,601 $ 3,658 $ 10,688 + Amortization of Intangible Assets 1,084 1,147 1,180 1,043 4,454 + Acquisition Deal Costs 299 239 254 226 1,018 + Income Tax Effect at 25% (346 ) (346 ) (359 ) (317 ) (1,368 ) Adjusted Net Income $ 4,109 $ 3,397 $ 2,676 $ 4,610 $ 14,792 Average Diluted Shares Outstanding 7,629 7,646 7,666 7,688 7,645 Diluted Earnings Per Share $ 0.40 $ 0.31 $ 0.21 $ 0.48 $ 1.40 Adjusted Diluted Earnings Per Share $ 0.54 $ 0.44 $ 0.35 $ 0.60 $ 1.93 TRANSCAT, INC. Additional Information - Business Segment Data (Dollars in thousands) (Unaudited) Change SERVICE FY 2024 Q1 FY 2023 Q1 $'s % Service Revenue $ 39,853 $ 33,876 $ 5,977 17.6 % Cost of Revenue 26,882 23,041 3,841 16.7 % Gross Profit $ 12,971 $ 10,835 $ 2,136 19.7 % Gross Margin 32.5 % 32.0 % Selling, Marketing & Warehouse Expenses $ 4,107 $ 3,583 $ 524 14.6 % General and Administrative Expenses 5,672 4,720 952 20.2 % Operating Income $ 3,192 $ 2,532 $ 660 26.1 % % of Revenue 8.0 % 7.5 % Change DISTRIBUTION FY 2024 Q1 FY 2023 Q1 $'s % Distribution Sales $ 20,745 $ 20,785 $ (40 ) (0.2 )% Cost of Sales 15,006 15,582 (576 ) (3.7 )% Gross Profit $ 5,739 $ 5,203 $ 536 10.3 % Gross Margin 27.7 % 25.0 % Selling, Marketing & Warehouse Expenses $ 2,362 $ 2,237 $ 125 5.6 % General and Administrative Expenses 1,929 1,894 35 1.8 % Operating Income $ 1,448 $ 1,072 $ 376 35.1 % % of Sales 7.0 % 5.2 % Change TOTAL FY 2024 Q1 FY 2023 Q1 $'s % Total Revenue $ 60,598 $ 54,661 $ 5,937 10.9 % Total Cost of Revenue 41,888 38,623 3,265 8.5 % Gross Profit $ 18,710 $ 16,038 $ 2,672 16.7 % Gross Margin 30.9 % 29.3 % Selling, Marketing & Warehouse Expenses $ 6,469 $ 5,820 $ 649 11.2 % General and Administrative Expenses 7,601 6,614 987 14.9 % Operating Income $ 4,640 $ 3,604 $ 1,036 28.7 % % of Revenue 7.7 % 6.6 % View source version on businesswire.com : https://www.businesswire.com/news/home/20230731601774/en/ For more information contact: Tom Barbato Phone: (585) 505-6530 Email: [email protected] Source: Transcat, Inc.

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