The following is a summary of the Transcat, Inc. (TRNS) Q2 2025 Earnings Call Transcript:

Financial Performance:

• Transcat Inc. reported a Q2 consolidated revenue of $67.8 million, an increase of 8% from the previous year.

• Consolidated gross profit was up 5%, driven by both service and distribution segments.

• Q2 net income was $3.3 million, improved significantly from $0.5 million due to adjustments and initiatives.

• Adjusted EBITDA was $8.9 million, down 5% impacted by lower expected NEXA revenue and hurricane effects on Becnel.

Business Progress:

• Transcat is actively integrating NEXA into its broader operations, rebranding it as Transcat Solutions, to enhance its sales and marketing strategies.

• The company is focusing on expanding its geographical footprint, capabilities, and expertise through a robust M&A strategy.

• There is a strong focus on leveraging automation and continuous process improvement as key drivers for future margin expansion and sustainable growth.

Opportunities:

• Ongoing diversification and improvement in service offerings, such as the expansion of Transcat and Axiom rental platforms.

• A very active M&A strategy aims to continue to grow and strengthen the core business, marking opportunities for sustainable expansion.

Risks:

• NEXA recently underperformed due to inefficient sales processes which are now currently being addressed for rapid improvement.

• The distribution segment faced headwinds due to climatic factors like hurricanes impacting revenues and margins, particularly affecting Becnel's performance.

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