Transcat, Inc. (NASDAQ: TRNS) reported Q1 EPS of $0.19, $0.02 better than the analyst estimate of $0.17. Revenue for the quarter came in at $36.66 million versus the consensus estimate of $39.06 million.

“The operating leverage we believe is inherent in our business combined with the early impact from our operational excellence initiatives were demonstrated in the first quarter with only modest improvement in revenue. Both of our segments saw margin expansion, resulting in enhanced profitability,” commented Lee D. Rudow, President and CEO.

He continued, “Our Service segment organic revenue growth rate was almost 5%, while our new business activity levels were quite strong. We generated a record level of new bookings in the first quarter, which we expect will drive higher levels of growth for the fiscal year as we continue to take market share.

“We maintained solid core new equipment sales volume within our Distribution segment, although we had some softness in our used equipment business. Solid mix, pricing and inventory management enabled significant margin expansion, nonetheless.”

Outlook

Mr. Rudow added, “Acquisitions will continue to be incremental to our overall growth expectations. Near quarter-end, we completed a small tuck-in purchase, NBS Calibrations, Inc. (“NBS”), which will be consolidated with our Phoenix, AZ facility. NBS both leverages our existing infrastructure and adds a capability in liquid and gas flow meter calibrations to our offerings. Historically outsourced, we now have the capability in-house creating a niche service we can continue to expand. In addition to closing NBS, our current acquisition pipeline is active and we believe we have a strong balance sheet to execute our growth strategy.”

Mr. Rudow concluded, “We expect to deliver solid fiscal 2019 results. Our strong and unique value proposition continues to resonate in the market, and recent new business wins in our Service segment support our confidence level. The Distribution business is also expected to continue to generate significant cash, provide differentiation in the market and foster Service growth opportunities. And, with a continued focus on leveraging technology as a competitive advantage, over the long-term, we believe we can drive higher margins in both segments.”

For earnings history and earnings-related data on Transcat, Inc. (TRNS) click here.