Transcat Inc (NASDAQ: TRNS)

Transcat, Inc. is a leading provider of accredited calibration services cost control and optimization services and distribution and rental of professional grade handheld test measurement and control instrumentation. The company focuses on serving highly regulated industries especially the life science sector which includes pharmaceutical biotechnology medical device and other FDA regulated businesses. Additional industries served are industrial manufacturing energy and utilities including oil and gas chemical manufacturing FAA regulated businesses such as aerospace and defense and other sectors that require precise measurement and where equipment failure carries significant risk. Transcat is headquartered in Rochester New York and operates calibration service centers across the United States Puerto Rico Canada and Ireland.

The company generates revenue through two main activities. In its Service segment it provides calibration repair inspection analytical qualifications preventive maintenance consulting and other related services delivered via on site mobile in house and client based lab arrangements. These services are supported by the proprietary asset management system CalTrak and the online portal C3. In its Distribution segment Transcat sells and rents national and brand name test measurement and control instruments offering more than seventy five thousand products from approximately four hundred manufacturers. Value added offerings include pre shipment calibration equipment kitting equipment rental and used equipment sales. Revenue is also derived from providing technical support application assistance and training to customers.

The company operates through the following segments Service and Distribution.

• The Service segment delivers calibration repair inspection analytical qualifications preventive maintenance consulting and related services through a network of thirty three calibration service centers located in the United States Puerto Rico Canada and Ireland. It offers on site mobile in house and client based lab service models and operates a fleet of mobile calibration laboratories. All centers hold ISO IEC 17025 2017 accreditation and use the proprietary CalTrak and C3 platforms to manage workflow and provide customers with web based access to service records.

• The Distribution segment sells and rents test measurement and control instruments from approximately four hundred brands providing access to more than seventy five thousand products. It offers value added services such as pre shipment calibration equipment kitting equipment rental and used equipment sales. The segment also provides technical support application assistance and training to help customers select and use the right instruments for their applications.

Transcat holds a strong position in the fragmented calibration and test instrument distribution markets. Its competitive advantages stem from possessing one of the broadest ISO IEC 17025 2017 accreditation scopes in the industries it serves from operating a widespread geographic footprint of service centers and from offering proprietary software solutions CalTrak and C3 that integrate service data with customer asset management. The company differentiates itself by bundling calibrated equipment sales with value added services such as pre shipment calibration and by providing a full suite of cost control and optimization services that support asset life cycle management. Competitors include large original equipment manufacturers that focus on brand specific calibration national distributors that lack calibration capabilities and online retailers that compete primarily on price but do not offer the same level of accredited service.

Transcat serves approximately thirty thousand customers across a diverse set of industries. Its customer base includes leading manufacturers in the life science pharmaceutical biotechnology and medical device sectors as well as companies in industrial manufacturing energy and utilities oil and gas chemical manufacturing and aerospace and defense. The company notes that no single customer or group of customers accounts for five percent or more of total revenue indicating a diversified base where the loss of any one account would not have a material effect on results.