Tag: lee rudow

Transcat Inc. on Tuesday reported record first-quarter results, beating Wall Street estimates.

For the first quarter ended June 26, the Rochester provider of accredited calibration, repair, inspection and laboratory instrument services posted revenues of $47.79 million, up nearly 23 percent from $38.9 million in the year-ago quarter. Net income for the quarter was $3.69 billion, up from $798 million in the first quarter of fiscal 2021. Diluted earnings per share increased to 49 cents from 11 cents.

Analysts had expected earnings of 25 cents on sales of $44.42 million.

“The start to our fiscal year 2022 was very strong and allowed us to achieve record first-quarter revenue, gross margin, operating income and EBITDA,” said Transcat President and CEO Lee Rudow. “Our service segment continued to perform at a high level, growing revenue 20 percent and increasing gross margin 540 basis points from the prior-year period. We reported 16.6 percent organic revenue growth as our highly-regulated end markets, including life sciences, remained strong, and we compared against a COVID-19 impacted prior-year quarter. Our gross margin improvement was driven by operating leverage on our fixed costs from the strong organic growth and to a lesser degree continued strong technician productivity.”

At the end of the first quarter, the company had $27.9 million available for borrowing under its secured revolving credit facility. Total debt of $22.2 million was up $2.6 million from fiscal 2021 year-end.

“Cash flow from operations in the first quarter was in line with our expectations and our balance sheet remains strong,” Rudow said. “We recently announced an amendment to our credit facility which favorably updates certain terms and increases our available revolving line of credit from $40 million to $80 million to support future growth investments and a robust acquisition pipeline.”

Rudow added: “For the second quarter of fiscal 2022, we expect service organic growth to be similar to what we achieved in the first quarter. We expect more modest improvement in service gross margin than we have experienced over the last several quarters, largely due to a more difficult technician productivity comparison versus the second quarter of fiscal 2021. Distribution is expected to achieve high teens growth in the second quarter on improved order trends and a prior-year comparison that includes lower levels of demand due to the COVID-19 pandemic.”

Shares of company stock (Nasdaq: TRNS) spiked early Wednesday but by mid-afternoon had settled at $60.40.

[email protected] / 585-653-4021
Follow Velvet Spicer on Twitter: @Velvet_Spicer

Rochester’s Transcat Inc. on Tuesday reported record sales and operating income for the fourth quarter, beating Wall Street estimates.

For the quarter ended March 27, the manufacturer reported revenue of $48.8 million, a nearly 7 percent increase from $45.8 million in the fourth quarter last year. Net income for the quarter increased nearly 29 percent from $2.5 million to $3.2 million. On a per-share basis, earnings were 42 cents, compared with 33 cents in the year-ago quarter.

Earnings beat Street estimates by 10 cents, while sales topped expectations by $2.58 million.

“Our fourth-quarter results were stronger than expected and allowed us to achieve record fourth-quarter and full-year revenue, operating income and cash flow, a remarkable achievement in the midst of the global COVID-19 pandemic,” said Transcat President and CEO Lee Rudow. “Our Service segment delivered another excellent quarter, growing revenue 15.8 percent and increasing gross margin by 500 basis points from the prior-year period. We reported double-digit organic revenue growth of 10 percent as our strategy to capture share in highly regulated end markets, including Life Sciences, continues to serve us well. Our gross margin improvement was driven by technician productivity, operating leverage on our fixed costs and strong performances from our recent acquisitions.”

Distribution segment sales continued to be impacted by the pandemic, with a nearly 5 percent drop year-over-year. Rudow, however, said Transcat was encouraged by the segment’s sales, which were the best quarterly result of fiscal 2021.

“We generated cash flow from operations of $23.6 million for the full year, a company record and double the cash we generated in fiscal 2020. We used our cash to pay down debt, fund technology investments and execute our acquisition strategy,” Rudow said. “In April 2021, we acquired Upstate Metrology, a Rochester-based calibration service provider with approximately $1 million in annual revenue. We plan to leverage our current infrastructure and consolidate the business into our main Rochester lab.”

For the full year, sales were roughly flat at $173.3 million. Net income was down roughly 3 percent to $7.8 million. Income per diluted share was $1.03, compared with $1.08 in fiscal 2020.

“I am incredibly proud of the performance and dedication of the entire Transcat team in the fourth quarter and throughout fiscal 2021 as we navigated the most challenging operating environment in recent history. We enter fiscal 2022 with a strong balance sheet, sustainable Service segment gross margins and an active M&A pipeline. We are confident that our disciplined focus on highly-regulated end markets and our new customer pipeline positions us well for continued strong organic growth,” Rudow said.

Shares of company stock (Nasdaq: TRNS) spiked early Wednesday and by midday were trading up nearly 14 percent at $54.00.

[email protected] / 585-653-4021
Follow Velvet Spicer on Twitter: @Velvet_Spicer

Transcat Inc. on Tuesday reported a third-quarter operating income increase of 20 percent, with service revenue up more than 12 percent.

For the quarter ended Dec. 26, the Rochester provider of accredited calibration, repair, inspection and laboratory instrument services posted revenue of $44.1 million, up 2 percent from $43.2 million in the year-ago quarter. Net income was $1.76 million, up from $1.48 million in the same quarter last year. On a per-share basis, earnings were 23 cents, up from 20 cents a year ago.

Analysts had expected earnings of 19 cents on sales of $42.99 million.

“In an environment that continues to be significantly impacted by the COVID-19 pandemic, our third-quarter results demonstrated the resiliency of our business and effectiveness of our strategy as we delivered better than expected results,” said President and CEO Lee Rudow. “Our service segment delivered another excellent quarter, growing revenue 12.2 percent and increasing gross margin by 590 basis points from the prior-year period. We were certainly encouraged by organic growth of 5.9 percent as our strategy to capture opportunities in highly-regulated end markets, including life sciences, continues to serve us well. Our gross margin improvement was driven by technician productivity, expense reductions, operating leverage on our fixed costs and the strong performance of pipettes.com.”

Transcat’s distribution segment continues to be negatively impacted by the current market environment but performed in line with expectations, Rudow said.

“Overall, our service segment performance drove third-quarter consolidated operating income of $2.5 million, exceeding our expectations and growing 20 percent from prior year. Year-to-date cash flow from operations of $15.6 million was nearly double from prior year and was used, in part, to fund technology investments and our acquisition strategy,” he added.

The company’s pipettes.com business delivered strong results and its acquisition of
BioTek increases Transcat’s exposure to the growing pipettes market, as well as broadens its geographic footprint, Rudow noted. BioTek also gives Transcat additional on-site technician capabilities, complementing the largely in-house technician business model at pipettes.com.

“The results of the third quarter were excellent and we are pleased with our service segment’s return to organic growth and its continued margin expansion. Our balance sheet is solid and the M&A pipeline is growing and active,” Rudow said. “We are confident that our disciplined focus on highly-regulated end markets and our new customer pipeline positions us well for strong organic growth as we continue to operate in a very challenging environment.”

For the fourth quarter, Transcat expects solid service revenue growth compared with last year’s fourth quarter. The company expects an improvement in service gross margin year-over-year, but not to the same degree as experienced in the last two quarters, largely due to more difficult technician productivity comparisons and the anniversary of the company’s acquisition of pipettes.com. Distribution is expected to continue to be negatively impacted by the current operating environment.

Shares of company stock (Nasdaq: TRNS) were trading up more than 6 percent Wednesday afternoon at $40.14.

[email protected] / 585-653-4021
Follow Velvet Spicer on Twitter: @Velvet_Spicer

Rochester’s Transcat Inc. this week reported record second-quarter operating income and a strong gross margin.

For the quarter ended Sept. 26, the manufacturer reported sales of $41.6 million, compared with $41.8 million in the second quarter last year. Net income for the quarter fell to $2.02 million from $2.38 million a year ago. Gross margin improve to 27.6 percent from 25 percent.

“Our service segment delivered another excellent quarter, reaching the second-highest gross margin level in company history,” said Transcat President and CEO Lee Rudow. “Technician productivity, expense reductions and strategic pricing drove the margin improvement, which was further helped by a favorable mix and the results of pipettes.com. Our teams have done a tremendous job leveraging our technology investments and have remained focused on driving efficiencies and better cost controls in our lab network.”

Operating expenses for the quarter increased nearly 14 percent due to investments to further technology initiatives and incremental expenses related to pipettes.com.

“In addition to the high level of performance in our service segment, we were certainly encouraged with the distribution segment, where sales grew significantly over our first quarter of fiscal 2021,” Rudow said. “Overall, our service margin performance helped drive record second quarter consolidated operating income of more than $3 million, exceeding our expectations. Additionally, we continued to generate strong cash from operations, which was used in part to reduce debt and fund technology investments.”

Transcat is a provider of accredited calibration, repair, inspection and laboratory instrument services.

“The results of the second quarter were strong and we are pleased with the significant progress made in our service margin expansion initiatives,” Rudow said. “Our balance sheet is solid and the M&A pipeline is active. Additionally, we believe our new customer pipeline positions us well for strong organic growth as we work through these current challenging times.”

Since reporting earnings on Tuesday, shares of company stock (Nasdaq: TRNS) have climbed from $27.63 to $31 midday Friday.

[email protected] / 585-653-4021
Follow Velvet Spicer on Twitter: @Velvet_Spicer