Mesa Laboratories (MLAB) Tops Q3 EPS by 14c

Mesa Laboratories (NASDAQ: MLAB) reported Q3 EPS of $0.87, $0.14 better than the analyst estimate of $0.73. Revenue for the quarter came in at $17.83 million, versus $13.12 million reported last year.

"Mesa's financial performance in the third quarter of fiscal year 2015 was very good," said John J. Sullivan, President and Chief Executive Officer. "I am especially pleased that organic revenue growth was 14 percent which, when combined with acquisition related growth, resulted in a 36 percent increase in revenues over this quarter last year. For the full nine months of this fiscal year Mesa's organic growth has been a robust 11 percent. Another highlight of the quarter was that gross profit margins improved 300 basis points over last year to 62 percent. We have seen gross profit margins improve from 59 percent and 60 percent in the first and second quarters, respectively, due largely to completing several extensive business integration efforts from our previous acquisitions. Mesa's adjusted net income (or "ANI") also grew very well this quarter, at 40 percent, although it could have been better. If you exclude the unusual sales tax liability accrual mentioned above, ANI growth would have been 53 percent and, more importantly, reached 19 percent of revenues or $0.95 per diluted share of common stock. Overall, the third quarter performance was solid and we believe that the revenue momentum will carry into the last quarter of the fiscal year."

"Longer term, I am cautiously optimistic about Mesa's prospects for continued revenue and profit growth," continued John Sullivan. "Tempering my optimism somewhat are the general global economic conditions, which look to be a bit uncertain, and how the collapse in the value of the Euro could further deteriorate conditions. Fortunately, only a small percent of Mesa's revenues are denominated in Euros, so its decline will have little impact on our revenues. The larger effect of the Euro's decline will likely be on the price competitiveness of our products in the marketplace, a situation we will monitor closely. On the plus side, a lower Euro makes European acquisitions somewhat less expensive. We continue to execute the growth strategy that we have had in place for nearly ten years. We are making new investments in R&D and Marketing to bolster organic growth, along with a new ERP system to improve the efficiency and scalability of the business. We continue our pursuit of new acquisitions to complement organic growth, with the long term goal of maintaining overall annual double-digit growth. With 43 percent revenues growth and 40 percent ANI growth through the first three quarters of the year, fiscal 2014 is shaping up to far exceed these long term goals."

For earnings history and earnings-related data on Mesa Laboratories (MLAB) click here.

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