Transcat, Inc. (NASDAQ: TRNS) reported Q2 EPS of $0.27, $0.10 better than the analyst estimate of $0.17. Revenue for the quarter came in at $41.6 million versus the consensus estimate of $40.29 million.

• Consolidated gross margin up 260 basis points to 27.6% driven by impressive Service segment gross margin of 32.2%
• Total revenue of $41.6 million consistent with prior-year period in a challenging market environment; Service segment achieved 46th consecutive quarter of year-over-year growth
• Quarterly cash from operations of $8.5 million; debt reduced by $5.8 million

“Our Service segment delivered another excellent quarter, reaching the second highest gross margin level in company history at 32.2%, an increase of 660 basis points year-over-year,” commented Lee D. Rudow, President and CEO. “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.”

“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. 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.”

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