Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Sep. 29, 2018 | Nov. 02, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | TRANSCAT INC | |
Entity Central Index Key | 99,302 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --03-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Document Type | 10-Q | |
Trading Symbol | TRNS | |
Document Fiscal Year Focus | 2,019 | |
Document Period End Date | Sep. 29, 2018 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 7,203,497 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Sep. 29, 2018 | Sep. 23, 2017 | Sep. 29, 2018 | Sep. 23, 2017 | |
Total Revenue | $ 38,879 | $ 35,927 | $ 75,537 | $ 72,206 |
Total Cost of Revenue | 29,740 | 27,773 | 57,285 | 55,361 |
Gross Profit | 9,139 | 8,154 | 18,252 | 16,845 |
Selling, Marketing and Warehouse Expenses | 4,020 | 4,005 | 8,052 | 8,097 |
General and Administrative Expenses | 2,943 | 2,691 | 5,999 | 5,879 |
Total Operating Expenses | 6,963 | 6,696 | 14,051 | 13,976 |
Operating Income | 2,176 | 1,458 | 4,201 | 2,869 |
Interest and Other Expense, net | 195 | 271 | 420 | 543 |
Income Before Income Taxes | 1,981 | 1,187 | 3,781 | 2,326 |
Provision for Income Taxes | 493 | 406 | 865 | 689 |
Net Income | $ 1,488 | $ 781 | $ 2,916 | $ 1,637 |
Basic Earnings Per Share | $ 0.21 | $ 0.11 | $ 0.41 | $ 0.23 |
Average Shares Outstanding | 7,200 | 7,131 | 7,187 | 7,102 |
Diluted Earnings Per Share | $ 0.20 | $ 0.11 | $ 0.39 | $ 0.23 |
Average Shares Outstanding | 7,520 | 7,286 | 7,486 | 7,242 |
Service Revenue [Member] | ||||
Total Revenue | $ 19,902 | $ 18,239 | $ 39,227 | $ 36,721 |
Total Cost of Revenue | 15,095 | 13,919 | 29,501 | 27,765 |
Distribution Sales [Member] | ||||
Total Revenue | 18,977 | 17,688 | 36,310 | 35,485 |
Total Cost of Revenue | $ 14,645 | $ 13,854 | $ 27,784 | $ 27,596 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Sep. 29, 2018 | Sep. 23, 2017 | Sep. 29, 2018 | Sep. 23, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net Income | $ 1,488 | $ 781 | $ 2,916 | $ 1,637 |
Other Comprehensive Income (Loss): | ||||
Currency Translation Adjustment | 92 | 336 | (4) | 377 |
Other, net of tax effects | 8 | 17 | 11 | 25 |
Total Other Comprehensive Income | 100 | 353 | 7 | 402 |
Comprehensive Income | $ 1,588 | $ 1,134 | $ 2,923 | $ 2,039 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 29, 2018 | Mar. 31, 2018 |
Current Assets: | ||
Cash | $ 571 | $ 577 |
Accounts Receivable, less allowance for doubtful accounts of $300 and $296 as of September 29, 2018 and March 31, 2018, respectively | 24,053 | 24,684 |
Other Receivables | 1,623 | 1,361 |
Inventory, net | 14,161 | 12,651 |
Prepaid Expenses and Other Current Assets | 1,227 | 1,240 |
Total Current Assets | 41,635 | 40,513 |
Property and Equipment, net | 19,591 | 17,091 |
Goodwill | 34,120 | 32,740 |
Intangible Assets, net | 6,197 | 5,505 |
Other Assets | 870 | 973 |
Total Assets | 102,413 | 96,822 |
Current Liabilities: | ||
Accounts Payable | 12,903 | 13,535 |
Accrued Compensation and Other Liabilities | 5,160 | 5,240 |
Income Taxes Payable | 624 | 232 |
Current Portion of Long-Term Debt | 2,143 | 2,143 |
Total Current Liabilities | 20,830 | 21,150 |
Long-Term Debt | 23,153 | 20,707 |
Deferred Tax Liabilities | 1,708 | 1,709 |
Other Liabilities | 1,856 | 1,908 |
Total Liabilities | 47,547 | 45,474 |
Shareholders' Equity: | ||
Common Stock, par value $0.50 per share, 30,000,000 shares authorized; 7,201,589 and 7,155,050 shares issued and outstanding as of September 29, 2018 and March 31, 2018, respectively | 3,601 | 3,578 |
Capital in Excess of Par Value | 15,599 | 14,965 |
Accumulated Other Comprehensive Loss | (274) | (281) |
Retained Earnings | 35,940 | 33,086 |
Total Shareholders' Equity | 54,866 | 51,348 |
Total Liabilities and Shareholders' Equity | $ 102,413 | $ 96,822 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 29, 2018 | Mar. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Accounts Receivable, allowance for doubtful accounts (in Dollars) | $ 300 | $ 296 |
Common Stock, par value per share (in Dollars per share) | $ 0.50 | $ 0.50 |
Common Stock, shares authorized | 30,000,000 | 30,000,000 |
Common Stock, shares issued | 7,201,589 | 7,155,050 |
Common Stock, shares outstanding | 7,201,589 | 7,155,050 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Sep. 29, 2018 | Sep. 23, 2017 | |
Cash Flows from Operating Activities: | ||
Net Income | $ 2,916 | $ 1,637 |
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: | ||
Net Loss on Disposal of Property and Equipment | 6 | 25 |
Deferred Income Taxes | (1) | 41 |
Depreciation and Amortization | 3,067 | 2,984 |
Provision for Accounts Receivable and Inventory Reserves | 74 | 203 |
Stock-Based Compensation Expense | 606 | 831 |
Changes in Assets and Liabilities: | ||
Accounts Receivable and Other Receivables | 856 | 760 |
Inventory | (1,172) | (1,020) |
Prepaid Expenses and Other Assets | 101 | (145) |
Accounts Payable | (706) | (1,747) |
Accrued Compensation and Other Liabilities | (1,271) | (1,458) |
Income Taxes Payable | 389 | (456) |
Net Cash Provided by Operating Activities | 4,865 | 1,655 |
Cash Flows from Investing Activities: | ||
Purchases of Property and Equipment | (3,703) | (3,942) |
Proceeds from Sale of Property and Equipment | 6 | |
Business Acquisitions, net of cash acquired | (3,614) | |
Net Cash Used in Investing Activities | (7,317) | (3,936) |
Cash Flows from Financing Activities: | ||
Proceeds from Revolving Credit Facility, net | 3,517 | 3,110 |
Repayment of Term Loan | (1,071) | (714) |
Issuance of Common Stock | 132 | 761 |
Repurchase of Common Stock | (143) | (344) |
Stock Option Redemption | (90) | |
Net Cash Provided by Financing Activities | 2,435 | 2,723 |
Effect of Exchange Rate Changes on Cash | 11 | (659) |
Net Decrease in Cash | (6) | (217) |
Cash at Beginning of Period | 577 | 842 |
Cash at End of Period | 571 | 625 |
Cash paid during the period for: | ||
Interest | 413 | 510 |
Income Taxes, net | $ 472 | $ 1,125 |
CONSOLIDATED STATEMENT OF SHARE
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Capital In Excess of Par Value [Member] | Accumulated Other Comprehensive (Loss) [Member] | Retained Earnings [Member] | Total |
Balance at Mar. 25, 2017 | $ 3,522 | $ 12,996 | $ (414) | $ 27,297 | $ 43,401 |
Balance (in Shares) at Mar. 25, 2017 | 7,044,000 | ||||
Issuance of Common Stock | $ 49 | 712 | 761 | ||
Issuance of Common Stock (in Shares) | 98,000 | ||||
Repurchase of Common Stock | $ (14) | (205) | (125) | (344) | |
Repurchase of Common Stock (in Shares) | (27,000) | ||||
Stock-Based Compensation | $ 13 | 818 | 831 | ||
Stock-Based Compensation (in Shares) | 25,000 | ||||
Redemption of Stock Options | (90) | (90) | |||
Other Comprehensive Income | 402 | 402 | |||
Net Income | 1,637 | 1,637 | |||
Balance at Sep. 23, 2017 | $ 3,570 | 14,231 | (12) | 28,809 | 46,598 |
Balance (in Shares) at Sep. 23, 2017 | 7,140,000 | ||||
Balance at Mar. 31, 2018 | $ 3,578 | 14,965 | (281) | 33,086 | $ 51,348 |
Balance (in Shares) at Mar. 31, 2018 | 7,155,000 | 7,155,050 | |||
Issuance of Common Stock | $ 3 | 129 | $ 132 | ||
Issuance of Common Stock (in Shares) | 7,000 | ||||
Repurchase of Common Stock | $ (4) | (77) | (62) | (143) | |
Repurchase of Common Stock (in Shares) | (8,000) | ||||
Stock-Based Compensation | $ 24 | 582 | 606 | ||
Stock-Based Compensation (in Shares) | 48,000 | ||||
Other Comprehensive Income | 7 | 7 | |||
Net Income | 2,916 | 2,916 | |||
Balance at Sep. 29, 2018 | $ 3,601 | $ 15,599 | $ (274) | $ 35,940 | $ 54,866 |
Balance (in Shares) at Sep. 29, 2018 | 7,202,000 | 7,201,589 |
GENERAL
GENERAL | 6 Months Ended |
Sep. 29, 2018 | |
Accounting Policies [Abstract] | |
GENERAL | NOTE 1 – GENERAL Description of Business: Transcat, Inc. (“Transcat” or the “Company”) is a leading provider of accredited calibration and laboratory instrument services and a value-added distributor of professional grade test, measurement and control instrumentation. The Company is focused on providing services and products to highly regulated industries, particularly the life science industry, which includes pharmaceutical, biotechnology, medical device and other FDA-regulated businesses. Additional industries served include industrial manufacturing; energy and utilities, including oil and gas; chemical manufacturing; FAA-regulated businesses, including aerospace and defense and other industries that require accuracy in their processes, confirmation of the capabilities of their equipment, and for which the risk of failure is very costly. Basis of Presentation: Transcat’s unaudited Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8-03 of Regulation S-X of the Securities and Exchange Commission (“SEC”). Accordingly, the Consolidated Financial Statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of the Company’s management, all adjustments considered necessary for a fair presentation (consisting of normal recurring adjustments) have been included. The results for the interim periods are not necessarily indicative of what the results will be for the fiscal year. The accompanying Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements as of and for the fiscal year ended March 31, 2018 (“fiscal year 2018”) contained in the Company’s 2018 Annual Report on Form 10-K filed with the SEC. Revenue Recognition: Distribution sales are recorded when the product’s title and risk of loss transfers to the customer. The Company recognizes the majority of its Service revenue based upon when the calibration or other activity is performed and then shipped and/or delivered to the customer. The majority of the Company’s revenue generating activities have a single performance obligation and are recognized at the point in time when control transfers and/or our obligation has been fulfilled. Some Service revenue is generated from managing customers’ calibration programs in which the Company recognizes revenue over time. Revenue is measured as the amount of consideration it expects to receive in exchange for product shipped or services performed. Sales taxes and other taxes billed and collected from customers are excluded from revenue. The Company generally invoices its customers for freight, shipping, and handling charges. Provisions for customer returns are provided for in the period the related revenue is recorded based upon historical data. Revenue recognized from prior period performance obligations for the second quarter of fiscal year 2019 was immaterial. As of September 29, 2018, the Company had no unsatisfied performance obligations for contracts with an original expected duration of greater than one year. Pursuant to Topic 606 (defined below), the Company applied the practical expedient with respect to disclosure of the deferral and future expected timing of revenue recognition for transaction price allocated to remaining performance obligations. Deferred revenue, unbilled revenue and deferred contract costs recorded on our Consolidated Balance Sheets as of September 29, 2018 and March 31, 2018 were immaterial. Payment terms are generally 30 to 45 days. See Note 4 for disaggregated revenue information. In 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2014-09, Revenue from Contracts with Customers, which established principles to report useful information to financial statement users about the nature, timing and uncertainty of revenue from contracts with customers. ASU No. 2014-09 along with various related amendments comprise Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“Topic 606”), and provide guidance that is applicable to all contracts with customers regardless of industry-specific or transaction-specific fact patterns. Transcat adopted the new standard for its fiscal year ending March 30, 2019 (“fiscal year 2019”), which began April 1, 2018 using the modified retrospective approach to each prior reporting period presented. Based on our analysis, the Company concluded that the adoption of the amended guidance did not have a material impact on its net revenue recognition. The cumulative effect adjustment upon adoption of the ASU in the first quarter of fiscal year 2019 was immaterial. Fair Value of Financial Instruments: Transcat has determined the fair value of debt and other financial instruments using a valuation hierarchy. The hierarchy, which prioritizes the inputs used in measuring fair value, consists of three levels. Level 1 uses observable inputs such as quoted prices in active markets; Level 2 uses inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, which is defined as unobservable inputs in which little or no market data exists, requires the Company to develop its own assumptions. The carrying amount of debt on the Consolidated Balance Sheets approximates fair value due to variable interest rate pricing, and the carrying amounts for cash, accounts receivable and accounts payable approximate fair value due to their short-term nature. Investment assets, which fund the Company’s non-qualified deferred compensation plan, consist of mutual funds and are valued based on Level 1 inputs. At September 29, 2018 and March 31, 2018, investment assets totaled $0.6 million and $0.7 million, respectively, and are included as a component of other assets (non-current) on the Consolidated Balance Sheets. Stock-Based Compensation: The Company measures the cost of services received in exchange for all equity awards granted, including stock options and restricted stock units, based on the fair market value of the award as of the grant date. The Company records compensation expense related to unvested equity awards by recognizing, on a straight-line basis, the unamortized grant date fair value over the remaining service period of each award. Excess tax benefits for share-based award activity are reflected in the statement of income as a component of the provision for income taxes. Excess tax benefits are realized benefits from tax deductions for exercised awards in excess of the deferred tax asset attributable to stock-based compensation costs for such awards. The Company did not capitalize any stock-based compensation costs as part of an asset. The Company estimates forfeiture rates based on its historical experience. During the first six months of fiscal year 2019 and fiscal year 2018, the Company recorded non-cash stock-based compensation expense of $0.5 million and $0.8 million, respectively, in the Consolidated Statements of Income. Foreign Currency Translation and Transactions: The accounts of Transcat Canada Inc., a wholly-owned subsidiary of the Company, are maintained in the local currency and have been translated to U.S. dollars. Accordingly, the amounts representing assets and liabilities have been translated at the period-end rates of exchange and related revenue and expense accounts have been translated at an average rate of exchange during the period. Gains and losses arising from translation of Transcat Canada Inc.’s financial statements into U.S. dollars are recorded directly to the accumulated other comprehensive loss component of shareholders’ equity. Transcat records foreign currency gains and losses on its Canadian business transactions. The net foreign currency loss was less than $0.1 million during each of the first six months of fiscal years 2019 and 2018. The Company continually utilizes short-term foreign exchange forward contracts to reduce the risk that its earnings will be adversely affected by changes in currency exchange rates. The Company does not apply hedge accounting and therefore the net change in the fair value of the contracts, which totaled a loss of $0.1 million during each of the first six months of fiscal years 2019 and 2018, was recognized as a component of other expense in the Consolidated Statements of Income. The change in the fair value of the contracts is offset by the change in fair value on the underlying accounts receivables denominated in Canadian dollars being hedged. On September 29, 2018, the Company had a foreign exchange contract, which matured in October 2018, outstanding in the notional amount of $4.2 million. The foreign exchange contract was renewed in October 2018 and continues to be in place. The Company does not use hedging arrangements for speculative purposes. Earnings Per Share: Basic earnings per share of common stock are computed based on the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share of common stock reflect the assumed conversion of stock options and unvested restricted stock units using the treasury stock method in periods in which they have a dilutive effect. In computing the per share effect of assumed conversion, funds which would have been received from the exercise of options and unvested restricted stock units and the related tax benefits are considered to have been used to purchase shares of common stock at the average market prices during the period, and the resulting net additional shares of common stock are included in the calculation of average shares of common stock outstanding. For the second quarter of fiscal year 2019, the net additional common stock equivalents had a $0.01 effect on the calculation of diluted earnings per share. For the second quarter of fiscal year 2018, the net additional common stock equivalents had no effect on the calculation of dilutive earnings per share. For the first six months of fiscal year 2019, the net additional common stock had a $0.02 effect on the calculation of dilutive earnings per share. For the first six months of fiscal year 2018, the net additional common stock equivalents had no effect on the calculation of diluted earnings per share. The average shares outstanding used to compute basic and diluted earnings per share are as follows: Second Quarter Ended Six Months Ended September 29, September 23, September 29, September 23, 2018 2017 2018 2017 Average Shares Outstanding – Basic 7,200 7,131 7,187 7,102 Effect of Dilutive Common Stock Equivalents 320 155 299 140 Average Shares Outstanding – Diluted 7,520 7,286 7,486 7,242 Anti-dilutive Common Stock Equivalents - - - - Recently Issued Accounting Pronouncements: In February 2016, the FASB issued ASU No. 2016-02, Leases (ASC Topic 842), which requires lessees to recognize substantially all leases on the balance sheet and disclose key information about leasing arrangements. The new standard establishes a right of use ("ROU") model that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The new standard is effective for annual and interim periods beginning after December 15, 2018. ASU 2016-02 requires entities to adopt a modified retrospective transition method for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the consolidated financial statements. The Company continues to evaluate the impact that adopting ASU 2016-02 will have on its financial statements, but the most significant impact will be to increase assets and liabilities on the consolidated balance sheet by the present value of the Company’s leasing obligations, which are primarily related to facility and vehicle leases, as well as additional disclosures required. In July 2018, FASB issued ASU 2018-11, Leases (ASC Topic 842), which provides entities with an additional transition method to adopt the new leases standard. Under this method, an entity initially applies the new leases standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Consequently, the prior comparative period's financials will remain the same as those previously presented. Entities that elect this optional transition method must provide the disclosures that were previously required. The Company continues to evaluate the impact that adopting ASU 2018-11 will have on its financial statements. |
LONG-TERM DEBT
LONG-TERM DEBT | 6 Months Ended |
Sep. 29, 2018 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | NOTE 2 – LONG-TERM DEBT Description: On October 30, 2017, the Company entered into an Amended and Restated Credit Agreement (the “Credit Agreement”), which amended and restated our prior credit facility agreement. The Credit Agreement extended the term of the Company’s $30.0 million revolving credit facility (the “Revolving Credit Facility”) to October 29, 2021. As of September 29, 2018, $30.0 million was available under the Revolving Credit Facility, of which $12.3 million was outstanding and included in long-term debt on the Consolidated Balance Sheets. The Credit Agreement also increased the amount of the Company’s outstanding term loan to $15.0 million (the “2017 Term Loan”), replacing the previous term loan. As of September 29, 2018, $13.0 million was outstanding on the 2017 Term Loan, of which $2.1 million was included in current liabilities on the Consolidated Balance Sheets with the remainder included in long-term debt. The 2017 Term Loan requires principal repayments of $0.2 million per month plus interest through September 2022 with a $4.3 million repayment required on October 29, 2022. Under the Credit Agreement, borrowings that may be used for business acquisitions are limited to $20.0 million per fiscal year. During the first six months of fiscal year 2019, $3.6 million was used for a business acquisition. The allowable leverage ratio under the Credit Agreement remains at a maximum multiple of 3.0 of total debt outstanding compared to earnings before income taxes, depreciation and amortization, and non-cash stock-based compensation expense for the preceding four consecutive fiscal quarters. The excess funds of the 2017 Term Loan over the previous term loan were used to repay amounts outstanding under the Revolving Credit Facility. Interest and Other Costs: Interest on the Revolving Credit Facility and 2017 Term Loan accrues, at Transcat’s election, at either the variable one-month London Interbank Offered Rate (“LIBOR”) or a fixed rate for a designated period at the LIBOR corresponding to such period, in each case, plus a margin. Commitment fees accrue based on the average daily amount of unused credit available on the Revolving Credit Facility. Interest rate margins and commitment fees are determined on a quarterly basis based upon the Company’s calculated leverage ratio, as defined in the Credit Agreement. The one-month LIBOR as of September 29, 2018 was 2.3%. The Company’s interest rate for the first six months of fiscal year 2019 ranged from 3.2% to 3.6%. Covenants: The Credit Agreement has certain covenants with which the Company must comply, including a fixed charge ratio covenant and a leverage ratio covenant. The Company was in compliance with all loan covenants and requirements during the second quarter of fiscal year 2019. Our leverage ratio, as defined in the Credit Agreement, was 1.34 at September 29, 2018, compared with 1.40 at the end of fiscal year 2018. Other Terms: The Company has pledged all of its U.S. tangible and intangible personal property, the equity interests of its U.S.-based subsidiaries, and a majority of the common stock of Transcat Canada Inc. as collateral security for the loans made under the Revolving Credit Facility. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 6 Months Ended |
Sep. 29, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION | NOTE 3 – STOCK-BASED COMPENSATION The Transcat, Inc. 2003 Incentive Plan, as Amended and Restated (the “2003 Plan”), provides for, among other awards, grants of restricted stock units and stock options to directors, officers and key employees at the fair market value at the date of grant. At September 29, 2018, 1.1 million shares were available for future grant under the 2003 Plan. Restricted Stock Units: The Company generally grants performance-based restricted stock units as a primary component of executive compensation. In previous years, the units generally vested following the third fiscal year from the date of grant subject to certain cumulative diluted earnings per share growth targets over the eligible period. The restricted stock units granted in June 2017 and April 2018 were time vested. Beginning with the restricted stock units granted in May 2018, 50% of the units will vest subject to certain cumulative diluted earnings per share growth targets over the eligible period and 50% of the restricted stock units will be time vested over a three-year period. Compensation cost ultimately recognized for performance-based restricted stock units will equal the grant date fair market value of the unit that coincides with the actual outcome of the performance conditions. On an interim basis, the Company records compensation cost based on the estimated level of achievement of the performance conditions. The expense relating to the time vested restricted stock units is recognized on a straight-line basis over the requisite service period for the entire award. The Company achieved 50% of the target level for the performance-based restricted stock units granted in the fiscal year ended March 26, 2016 and as a result, issued 32 shares of common stock to executive officers and certain key employees during the first quarter of fiscal year 2019. The following table summarizes the non-vested performance-based restricted stock units outstanding as of September 29, 2018: Total Grant Date Estimated Number Fair Level of Date Measurement of Units Value Achievement at Granted Period Outstanding Per Unit September 29, 2018 April 2016 April 2016 - March 2019 82 $ 10.13 125% of target level April 2017 April 2017 – March 2020 75 $ 12.90 100% of target level June 2017 July 2017 – June 2020 3 $ 12.00 Time Vested April 2018 April 2018 – March 2020 2 $ 15.65 Time Vested May 2018 April 2018 – March 2020 30 $ 15.30 100% of target level May 2018 April 2018 – March 2020 30 $ 15.30 Time Vested Total expense relating to performance-based restricted stock units, based on grant date fair value and the achievement criteria, was $0.5 million and $0.4 million, respectively, in the first six months of fiscal years 2019 and 2018. As of September 29, 2018, unearned compensation to be recognized over the grants’ respective service periods totaled $1.5 million. Stock Options: Options vest either immediately or over a period of up to four years using a straight-line basis and expire either five years or ten years from the date of grant. The expense relating to options is recognized on a straight-line basis over the requisite service period for the entire award. The following table summarizes the Company’s options as of and for the first six months of fiscal year 2019: Weighted Weighted Average Average Number Exercise Remaining Aggregate of Price Per Contractual Intrinsic Shares Share Term (in years) Value Outstanding as of March 31, 2018 272 $ 10.27 Granted - - Exercised - - Forfeited (4 ) 6.75 Redeemed - - Outstanding as of September 29, 2018 268 $ 10.33 4 $ 3,355 Exercisable as of September 29, 2018 268 $ 10.33 4 $ 3,355 The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the second quarter of fiscal year 2019 and the exercise price, multiplied by the number of in-the-money stock options) that would have been received by the option holders had all holders exercised their options on September 29, 2018. The amount of aggregate intrinsic value will change based on the fair market value of the Company’s common stock. There was no expense related to stock options during the first six months of fiscal year 2019. Total expense related to stock options was $0.4 million for the first six months of fiscal year 2018. There was no total unrecognized compensation cost related to non-vested stock options as of September 29, 2018. There were no stock options exercised during the first six months of fiscal year 2019. The aggregate intrinsic value of stock options exercised in the first six months of fiscal year 2018 was $0.6 million. Cash received from the exercise of options in the first six months of fiscal year 2018 was $0.6 million. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Sep. 29, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | NOTE 4 – SEGMENT INFORMATION Transcat has two reportable segments: Distribution and Service. The Company has no inter-segment sales. The following table presents segment information for the second quarter and first six months of fiscal years 2019 and 2018: Second Quarter Ended Six Months Ended September 29, September 23, September 29, September 23, 2018 2017 2018 2017 Revenue: Service $ 19,902 $ 18,239 $ 39,227 $ 36,721 Distribution 18,977 17,688 36,310 35,485 Total 38,879 35,927 75,537 72,206 Gross Profit: Service 4,807 4,320 9,726 8,956 Distribution 4,332 3,834 8,526 7,889 Total 9,139 8,154 18,252 16,845 Operating Expenses: Service (1) 3,682 3,530 7,533 7,281 Distribution (1) 3,281 3,166 6,518 6,695 Total 6,963 6,696 14,051 13,976 Operating Income: Service 1,125 790 2,193 1,675 Distribution 1,051 668 2,008 1,194 Total 2,176 1,458 4,201 2,869 Unallocated Amounts: Interest and Other Expense, net 195 271 420 543 Provision for Income Taxes 493 406 865 689 Total 688 677 1,285 1,232 Net Income $ 1,488 $ 781 $ 2,916 $ 1,637 (1) Operating expense allocations between segments were based on actual amounts, a percentage of revenues, headcount, and management’s estimates. |
BUSINESS ACQUISITIONS
BUSINESS ACQUISITIONS | 6 Months Ended |
Sep. 29, 2018 | |
Business Combinations [Abstract] | |
BUSINESS ACQUISITIONS | NOTE 5 – BUSINESS ACQUISITIONS During the second quarter of fiscal year 2019, Transcat acquired substantially all of the assets of Angel’s Instrumentation, Inc. (“Angel’s”), a Virginia-based provider of calibration services. This transaction aligned with the Company’s acquisition strategy of targeting businesses that expand its geographic reach and leverage its infrastructure while also increasing the depth and breadth of the Company’s service capabilities. The Company applies the acquisition method of accounting for business acquisitions. Under the acquisition method, the purchase price of an acquisition is assigned to the underlying tangible and intangible assets acquired and liabilities assumed based on their respective fair values at the date of acquisition. The Company uses a valuation hierarchy, as further described under Fair Value of Financial Instruments in Note 1 above, and typically utilizes independent third-party valuation specialists to determine the fair values used in this allocation. Purchase price allocations are subject to revision within the measurement period, not to exceed one year from the date of acquisition. All of the goodwill and intangible assets relating to the Angel’s acquisition have been allocated to the Service segment. Intangible assets related to the Angel’s acquisition are being amortized for financial reporting purposes on an accelerated basis over the estimated useful life of up to 10 years and are deductible for tax purposes. Amortization of goodwill related to the Angel’s acquisition is expected to be deductible for tax purposes. The total purchase price paid for the assets of Angel’s was approximately $4.7 million, net of $0.1 million cash acquired. The following is a summary of the purchase price allocation, in the aggregate, to the fair value, based on Level 3 inputs, of Angel’s assets and liabilities acquired during the period presented: FY 2019 Goodwill $ 1,275 Intangible Assets – Customer Base 1,400 Intangible Assets – Covenant Not to Compete 100 2,775 Plus: Current Assets 787 Non-Current Assets 1,200 Less: Current Liabilities (24 ) Total Purchase Price $ 4,738 Certain of the Company’s acquisition agreements, including Angel’s include provisions for contingent consideration and other holdback amounts. The Company accrues for contingent consideration and holdback provisions based on their estimated fair value at the date of acquisition. As of September 29, 2018, $0.6 million of contingent consideration and $0.5 million of other holdback amounts were unpaid and reflected in current liabilities on the Consolidated Balance Sheets. No contingent consideration or holdback amounts were paid during the first six months of fiscal year 2019. As of March 31, 2018, no contingent consideration or other holdback amounts were outstanding. The results of the acquired businesses are included in Transcat’s consolidated operating results as of the dates the businesses were acquired. The following unaudited pro forma information presents the Company’s results of operations as if the acquisition of Angel’s had occurred at the beginning of fiscal year 2019 and fiscal year 2018. The pro forma results do not purport to represent what the Company’s results of operations actually would have been if the transaction had occurred at the beginning of the period presented or what the Company’s operating results will be in future periods. (Unaudited) Six Months Ended September 29, September 23, 2018 2017 Total Revenue $ 77,678 $ 73,991 Net Income $ 3,494 $ 1,922 Basic Earnings Per Share $ 0.49 $ 0.27 Diluted Earnings Per Share $ 0.48 $ 0.27 During each of the first six months of fiscal year 2019 and fiscal year 2018, acquisition costs of less than $0.1 million were recorded as incurred as general and administrative expenses in the Consolidated Statements of Income. During the first quarter of fiscal year 2019, Transcat acquired substantially all of the assets of NBS Calibration, Inc. (“NBS”), an Arizona-based provider of calibration services. This transaction aligned with the Company’s acquisition strategy of targeting businesses that expand the Company’s geographic reach and leverage its infrastructure while also increasing the depth and breadth of the Company’s service capabilities. Due to the immaterial amount of the purchase price of the NBS assets, it has been included in the purchases of property and equipment, net, in the consolidated statement of cash flows. |
GENERAL (Policies)
GENERAL (Policies) | 6 Months Ended |
Sep. 29, 2018 | |
Accounting Policies [Abstract] | |
Description of Business | Description of Business: Transcat, Inc. (“Transcat” or the “Company”) is a leading provider of accredited calibration and laboratory instrument services and a value-added distributor of professional grade test, measurement and control instrumentation. The Company is focused on providing services and products to highly regulated industries, particularly the life science industry, which includes pharmaceutical, biotechnology, medical device and other FDA-regulated businesses. Additional industries served include industrial manufacturing; energy and utilities, including oil and gas; chemical manufacturing; FAA-regulated businesses, including aerospace and defense and other industries that require accuracy in their processes, confirmation of the capabilities of their equipment, and for which the risk of failure is very costly. |
Basis of Presentation | Basis of Presentation: Transcat’s unaudited Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8-03 of Regulation S-X of the Securities and Exchange Commission (“SEC”). Accordingly, the Consolidated Financial Statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of the Company’s management, all adjustments considered necessary for a fair presentation (consisting of normal recurring adjustments) have been included. The results for the interim periods are not necessarily indicative of what the results will be for the fiscal year. The accompanying Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements as of and for the fiscal year ended March 31, 2018 (“fiscal year 2018”) contained in the Company’s 2018 Annual Report on Form 10-K filed with the SEC. |
Revenue Recognition | Revenue Recognition: Distribution sales are recorded when the product’s title and risk of loss transfers to the customer. The Company recognizes the majority of its Service revenue based upon when the calibration or other activity is performed and then shipped and/or delivered to the customer. The majority of the Company’s revenue generating activities have a single performance obligation and are recognized at the point in time when control transfers and/or our obligation has been fulfilled. Some Service revenue is generated from managing customers’ calibration programs in which the Company recognizes revenue over time. Revenue is measured as the amount of consideration it expects to receive in exchange for product shipped or services performed. Sales taxes and other taxes billed and collected from customers are excluded from revenue. The Company generally invoices its customers for freight, shipping, and handling charges. Provisions for customer returns are provided for in the period the related revenue is recorded based upon historical data. Revenue recognized from prior period performance obligations for the second quarter of fiscal year 2019 was immaterial. As of September 29, 2018, the Company had no unsatisfied performance obligations for contracts with an original expected duration of greater than one year. Pursuant to Topic 606 (defined below), the Company applied the practical expedient with respect to disclosure of the deferral and future expected timing of revenue recognition for transaction price allocated to remaining performance obligations. Deferred revenue, unbilled revenue and deferred contract costs recorded on our Consolidated Balance Sheets as of September 29, 2018 and March 31, 2018 were immaterial. Payment terms are generally 30 to 45 days. See Note 4 for disaggregated revenue information. In 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2014-09, Revenue from Contracts with Customers, which established principles to report useful information to financial statement users about the nature, timing and uncertainty of revenue from contracts with customers. ASU No. 2014-09 along with various related amendments comprise Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“Topic 606”), and provide guidance that is applicable to all contracts with customers regardless of industry-specific or transaction-specific fact patterns. Transcat adopted the new standard for its fiscal year ending March 30, 2019 (“fiscal year 2019”), which began April 1, 2018 using the modified retrospective approach to each prior reporting period presented. Based on our analysis, the Company concluded that the adoption of the amended guidance did not have a material impact on its net revenue recognition. The cumulative effect adjustment upon adoption of the ASU in the first quarter of fiscal year 2019 was immaterial. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments: Transcat has determined the fair value of debt and other financial instruments using a valuation hierarchy. The hierarchy, which prioritizes the inputs used in measuring fair value, consists of three levels. Level 1 uses observable inputs such as quoted prices in active markets; Level 2 uses inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, which is defined as unobservable inputs in which little or no market data exists, requires the Company to develop its own assumptions. The carrying amount of debt on the Consolidated Balance Sheets approximates fair value due to variable interest rate pricing, and the carrying amounts for cash, accounts receivable and accounts payable approximate fair value due to their short-term nature. Investment assets, which fund the Company’s non-qualified deferred compensation plan, consist of mutual funds and are valued based on Level 1 inputs. At September 29, 2018 and March 31, 2018, investment assets totaled $0.6 million and $0.7 million, respectively, and are included as a component of other assets (non-current) on the Consolidated Balance Sheets. |
Stock-Based Compensation | Stock-Based Compensation: The Company measures the cost of services received in exchange for all equity awards granted, including stock options and restricted stock units, based on the fair market value of the award as of the grant date. The Company records compensation expense related to unvested equity awards by recognizing, on a straight-line basis, the unamortized grant date fair value over the remaining service period of each award. Excess tax benefits for share-based award activity are reflected in the statement of income as a component of the provision for income taxes. Excess tax benefits are realized benefits from tax deductions for exercised awards in excess of the deferred tax asset attributable to stock-based compensation costs for such awards. The Company did not capitalize any stock-based compensation costs as part of an asset. The Company estimates forfeiture rates based on its historical experience. During the first six months of fiscal year 2019 and fiscal year 2018, the Company recorded non-cash stock-based compensation expense of $0.5 million and $0.8 million, respectively, in the Consolidated Statements of Income. |
Foreign Currency Translation and Transactions | Foreign Currency Translation and Transactions: The accounts of Transcat Canada Inc., a wholly-owned subsidiary of the Company, are maintained in the local currency and have been translated to U.S. dollars. Accordingly, the amounts representing assets and liabilities have been translated at the period-end rates of exchange and related revenue and expense accounts have been translated at an average rate of exchange during the period. Gains and losses arising from translation of Transcat Canada Inc.’s financial statements into U.S. dollars are recorded directly to the accumulated other comprehensive loss component of shareholders’ equity. Transcat records foreign currency gains and losses on its Canadian business transactions. The net foreign currency loss was less than $0.1 million during each of the first six months of fiscal years 2019 and 2018. The Company continually utilizes short-term foreign exchange forward contracts to reduce the risk that its earnings will be adversely affected by changes in currency exchange rates. The Company does not apply hedge accounting and therefore the net change in the fair value of the contracts, which totaled a loss of $0.1 million during each of the first six months of fiscal years 2019 and 2018, was recognized as a component of other expense in the Consolidated Statements of Income. The change in the fair value of the contracts is offset by the change in fair value on the underlying accounts receivables denominated in Canadian dollars being hedged. On September 29, 2018, the Company had a foreign exchange contract, which matured in October 2018, outstanding in the notional amount of $4.2 million. The foreign exchange contract was renewed in October 2018 and continues to be in place. The Company does not use hedging arrangements for speculative purposes. |
Earnings Per Share | Earnings Per Share: Basic earnings per share of common stock are computed based on the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share of common stock reflect the assumed conversion of stock options and unvested restricted stock units using the treasury stock method in periods in which they have a dilutive effect. In computing the per share effect of assumed conversion, funds which would have been received from the exercise of options and unvested restricted stock units and the related tax benefits are considered to have been used to purchase shares of common stock at the average market prices during the period, and the resulting net additional shares of common stock are included in the calculation of average shares of common stock outstanding. For the second quarter of fiscal year 2019, the net additional common stock equivalents had a $0.01 effect on the calculation of diluted earnings per share. For the second quarter of fiscal year 2018, the net additional common stock equivalents had no effect on the calculation of dilutive earnings per share. For the first six months of fiscal year 2019, the net additional common stock had a $0.02 effect on the calculation of dilutive earnings per share. For the first six months of fiscal year 2018, the net additional common stock equivalents had no effect on the calculation of diluted earnings per share. The average shares outstanding used to compute basic and diluted earnings per share are as follows: Second Quarter Ended Six Months Ended September 29, September 23, September 29, September 23, 2018 2017 2018 2017 Average Shares Outstanding – Basic 7,200 7,131 7,187 7,102 Effect of Dilutive Common Stock Equivalents 320 155 299 140 Average Shares Outstanding – Diluted 7,520 7,286 7,486 7,242 Anti-dilutive Common Stock Equivalents - - - - |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements: In February 2016, the FASB issued ASU No. 2016-02, Leases (ASC Topic 842), which requires lessees to recognize substantially all leases on the balance sheet and disclose key information about leasing arrangements. The new standard establishes a right of use ("ROU") model that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The new standard is effective for annual and interim periods beginning after December 15, 2018. ASU 2016-02 requires entities to adopt a modified retrospective transition method for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the consolidated financial statements. The Company continues to evaluate the impact that adopting ASU 2016-02 will have on its financial statements, but the most significant impact will be to increase assets and liabilities on the consolidated balance sheet by the present value of the Company’s leasing obligations, which are primarily related to facility and vehicle leases, as well as additional disclosures required. In July 2018, FASB issued ASU 2018-11, Leases (ASC Topic 842), which provides entities with an additional transition method to adopt the new leases standard. Under this method, an entity initially applies the new leases standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Consequently, the prior comparative period's financials will remain the same as those previously presented. Entities that elect this optional transition method must provide the disclosures that were previously required. The Company continues to evaluate the impact that adopting ASU 2018-11 will have on its financial statements. |
GENERAL (Tables)
GENERAL (Tables) | 6 Months Ended |
Sep. 29, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Weighted Average Number of Shares | The average shares outstanding used to compute basic and diluted earnings per share are as follows: Second Quarter Ended Six Months Ended September 29, September 23, September 29, September 23, 2018 2017 2018 2017 Average Shares Outstanding – Basic 7,200 7,131 7,187 7,102 Effect of Dilutive Common Stock Equivalents 320 155 299 140 Average Shares Outstanding – Diluted 7,520 7,286 7,486 7,242 Anti-dilutive Common Stock Equivalents - - - - |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 6 Months Ended |
Sep. 29, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Restricted Stock Units Award Activity | The following table summarizes the non-vested performance-based restricted stock units outstanding as of September 29, 2018: Total Grant Date Estimated Number Fair Level of Date Measurement of Units Value Achievement at Granted Period Outstanding Per Unit September 29, 2018 April 2016 April 2016 - March 2019 82 $ 10.13 125% of target level April 2017 April 2017 – March 2020 75 $ 12.90 100% of target level June 2017 July 2017 – June 2020 3 $ 12.00 Time Vested April 2018 April 2018 – March 2020 2 $ 15.65 Time Vested May 2018 April 2018 – March 2020 30 $ 15.30 100% of target level May 2018 April 2018 – March 2020 30 $ 15.30 Time Vested |
Schedule of Stock Options Activity | The following table summarizes the Company’s options as of and for the first six months of fiscal year 2019: Weighted Weighted Average Average Number Exercise Remaining Aggregate of Price Per Contractual Intrinsic Shares Share Term (in years) Value Outstanding as of March 31, 2018 272 $ 10.27 Granted - - Exercised - - Forfeited (4 ) 6.75 Redeemed - - Outstanding as of September 29, 2018 268 $ 10.33 4 $ 3,355 Exercisable as of September 29, 2018 268 $ 10.33 4 $ 3,355 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Sep. 29, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information | Transcat has two reportable segments: Distribution and Service. The Company has no inter-segment sales. The following table presents segment information for the second quarter and first six months of fiscal years 2019 and 2018: Second Quarter Ended Six Months Ended September 29, September 23, September 29, September 23, 2018 2017 2018 2017 Revenue: Service $ 19,902 $ 18,239 $ 39,227 $ 36,721 Distribution 18,977 17,688 36,310 35,485 Total 38,879 35,927 75,537 72,206 Gross Profit: Service 4,807 4,320 9,726 8,956 Distribution 4,332 3,834 8,526 7,889 Total 9,139 8,154 18,252 16,845 Operating Expenses: Service (1) 3,682 3,530 7,533 7,281 Distribution (1) 3,281 3,166 6,518 6,695 Total 6,963 6,696 14,051 13,976 Operating Income: Service 1,125 790 2,193 1,675 Distribution 1,051 668 2,008 1,194 Total 2,176 1,458 4,201 2,869 Unallocated Amounts: Interest and Other Expense, net 195 271 420 543 Provision for Income Taxes 493 406 865 689 Total 688 677 1,285 1,232 Net Income $ 1,488 $ 781 $ 2,916 $ 1,637 (1) Operating expense allocations between segments were based on actual amounts, a percentage of revenues, headcount, and management’s estimates. |
BUSINESS ACQUISITIONS (Tables)
BUSINESS ACQUISITIONS (Tables) | 6 Months Ended |
Sep. 29, 2018 | |
Business Combinations [Abstract] | |
Schedule of Purchase Price Allocation | The following is a summary of the purchase price allocation, in the aggregate, to the fair value, based on Level 3 inputs, of Angel’s assets and liabilities acquired during the period presented: FY 2019 Goodwill $ 1,275 Intangible Assets – Customer Base 1,400 Intangible Assets – Covenant Not to Compete 100 2,775 Plus: Current Assets 787 Non-Current Assets 1,200 Less: Current Liabilities (24 ) Total Purchase Price $ 4,738 |
Schedule of Proforma Information | The following unaudited pro forma information presents the Company’s results of operations as if the acquisition of Angel’s had occurred at the beginning of fiscal year 2019 and fiscal year 2018. The pro forma results do not purport to represent what the Company’s results of operations actually would have been if the transaction had occurred at the beginning of the period presented or what the Company’s operating results will be in future periods. (Unaudited) Six Months Ended September 29, September 23, 2018 2017 Total Revenue $ 77,678 $ 73,991 Net Income $ 3,494 $ 1,922 Basic Earnings Per Share $ 0.49 $ 0.27 Diluted Earnings Per Share $ 0.48 $ 0.27 |
GENERAL (Narrative) (Details)
GENERAL (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Sep. 29, 2018 | Sep. 29, 2018 | Sep. 23, 2017 | Mar. 31, 2018 | |
Accounting Policies [Abstract] | ||||
Investments | $ 0.6 | $ 0.6 | $ 0.7 | |
Allocated Share-based Compensation Expense | 0.5 | $ 0.8 | ||
Foreign Currency Transaction Gain (Loss), Realized | (0.1) | (0.1) | ||
Foreign Currency Transaction Gain (Loss), Unrealized | (0.1) | $ (0.1) | ||
Derivative Asset, Notional Amount | $ 4.2 | $ 4.2 | ||
Dilutive Securities Effect Per Share on Earnings (in Dollars per share) | $ 0.01 | $ 0.02 |
GENERAL (Average Shares Outstan
GENERAL (Average Shares Outstanding Used to Compute Basic and Diluted Earnings per Share) (Details) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Sep. 29, 2018 | Sep. 23, 2017 | Sep. 29, 2018 | Sep. 23, 2017 | |
Accounting Policies [Abstract] | ||||
Average Shares Outstanding - Basic | 7,200 | 7,131 | 7,187 | 7,102 |
Effect of Dilutive Common Stock Equivalents | 320 | 155 | 299 | 140 |
Average Shares Outstanding - Diluted | 7,520 | 7,286 | 7,486 | 7,242 |
Anti-dilutive Common Stock Equivalents |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) $ in Thousands | 6 Months Ended | |
Sep. 29, 2018USD ($) | Mar. 31, 2018USD ($) | |
Debt Instrument [Line Items] | ||
Current portion of loan outstanding | $ 2,143 | $ 2,143 |
Allowable leverage ratio | 1.34 | 1.40 |
Busines acquisition | $ 3,600 | |
Loans Payable [Member] | ||
Debt Instrument [Line Items] | ||
Principal amount of loan | 15,000 | |
Loan outstanding | 13,000 | |
Current portion of loan outstanding | 2,100 | |
Monthly principal payments | 200 | |
Annual payments | 20,000 | |
Amount due in 2022 | 4,300 | |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | $ 30,000 | |
Debt Instrument, Interest Rate, Stated Percentage | 2.10% | |
Maturity date | Oct. 29, 2021 | |
Amount available | $ 30,000 | |
Amount outstanding | $ 12,300 | |
Revolving Credit Facility [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate for period | 3.20% | |
Revolving Credit Facility [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate for period | 3.60% | |
Revolving Credit Facility [Member] | Borrowings for Business Acquisitions [Member] | ||
Debt Instrument [Line Items] | ||
Amount due in 2022 | $ 3,000 |
STOCK-BASED COMPENSATION (Narra
STOCK-BASED COMPENSATION (Narrative) (Details) - USD ($) shares in Thousands, $ in Millions | 6 Months Ended | |
Sep. 29, 2018 | Sep. 23, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Allocated Share-based Compensation Expense | $ 0.5 | $ 0.8 |
2003 Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant (in Shares) | 1,100 | |
Performance Shares [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted Stock or Unit Expense | $ 0.5 | 0.4 |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $ 1.5 | |
Performance Shares [Member] | Performance Based Restricted Stock Awards Granted In 2018 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted stock Vesing units description | Beginning with the restricted stock units granted in May 2018, 50% of the units will vest subject to certain cumulative diluted earnings per share growth targets over the eligible period and 50% of the restricted stock units will be time vested over a three-year period. | |
Percent of Target Level Achieved | 50.00% | |
Number of Shares Issued | 32 | |
Employee Stock Option [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted Stock or Unit Expense | 0.4 | |
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | $ 0.6 | |
Proceeds from Stock Options Exercised | $ 0.6 | |
Employee Stock Option [Member] | Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years |
STOCK-BASED COMPENSATION (Non-V
STOCK-BASED COMPENSATION (Non-Vested Performance-Based Restricted Stock Units) (Details) - Performance Shares [Member] shares in Thousands | 6 Months Ended |
Sep. 29, 2018$ / sharesshares | |
Performance Based Restricted Stock Awards Granted In 2016 [Member] | |
Schedule of Stock Based Compensation Details Non Vested Performance Based Restricted Stock Units [Line Items] | |
Total Number of Units Outstanding | shares | 82 |
Grant Date Fair Value Per Unit (in Dollars per share) | $ / shares | $ 10.13 |
Estimated Level of Achievement | 125.00% |
Performance Based Restricted Stock Awards Granted In April 2017 [Member] | |
Schedule of Stock Based Compensation Details Non Vested Performance Based Restricted Stock Units [Line Items] | |
Total Number of Units Outstanding | shares | 75 |
Grant Date Fair Value Per Unit (in Dollars per share) | $ / shares | $ 12.90 |
Estimated Level of Achievement | 100.00% |
Performance Based Restricted Stock Awards Granted In June 2017 [Member] | |
Schedule of Stock Based Compensation Details Non Vested Performance Based Restricted Stock Units [Line Items] | |
Total Number of Units Outstanding | shares | 3 |
Grant Date Fair Value Per Unit (in Dollars per share) | $ / shares | $ 12 |
Performance Based Restricted Stock Awards Granted In April 2018 [Member] | |
Schedule of Stock Based Compensation Details Non Vested Performance Based Restricted Stock Units [Line Items] | |
Total Number of Units Outstanding | shares | 2 |
Grant Date Fair Value Per Unit (in Dollars per share) | $ / shares | $ 15.65 |
Performance Based Restricted Stock Awards Granted In May 2018 [Member] | |
Schedule of Stock Based Compensation Details Non Vested Performance Based Restricted Stock Units [Line Items] | |
Total Number of Units Outstanding | shares | 30 |
Grant Date Fair Value Per Unit (in Dollars per share) | $ / shares | $ 15.30 |
Estimated Level of Achievement | 100.00% |
Performance Based Restricted Stock Awards Granted In May 2018 [Member] | |
Schedule of Stock Based Compensation Details Non Vested Performance Based Restricted Stock Units [Line Items] | |
Total Number of Units Outstanding | shares | 30 |
Grant Date Fair Value Per Unit (in Dollars per share) | $ / shares | $ 15.30 |
STOCK-BASED COMPENSATION (Stock
STOCK-BASED COMPENSATION (Stock Options) (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 6 Months Ended |
Sep. 29, 2018USD ($)$ / sharesshares | |
Number of Shares | |
Outstanding, beginning balance | shares | 272 |
Granted | shares | |
Exercised | shares | |
Forfeited | shares | (4) |
Redeemed | shares | |
Outstanding, ending balance | shares | 268 |
Exercisable | shares | 268 |
Weighted Average Exercise Price Per Share | |
Outstanding, beginning balance | $ / shares | $ 10.27 |
Granted | $ / shares | |
Exercised | $ / shares | |
Forfeited | $ / shares | 6.75 |
Redeemed | $ / shares | |
Outstanding, ending balance | $ / shares | 10.33 |
Exercisable | $ / shares | $ 10.33 |
Weighted Average Remaining Contractual Term (in Years) | |
Outstanding | 4 years |
Exercisable | 4 years |
Aggregate Intrinsic Value | |
Outstanding | $ | $ 3,355 |
Exercisable | $ | $ 3,355 |
SEGMENT INFORMATION (Narrative)
SEGMENT INFORMATION (Narrative) (Details) - item | 6 Months Ended | |
Sep. 29, 2018 | Sep. 23, 2017 | |
Segment Reporting [Abstract] | ||
Number of Reportable Segments | 2 | 2 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Sep. 29, 2018 | Sep. 23, 2017 | Sep. 29, 2018 | Sep. 23, 2017 | ||
Revenue: | |||||
Revenue | $ 38,879 | $ 35,927 | $ 75,537 | $ 72,206 | |
Gross Profit: | |||||
Gross Profit | 9,139 | 8,154 | 18,252 | 16,845 | |
Operating Expenses: | |||||
Operating Expenses | 6,963 | 6,696 | 14,051 | 13,976 | |
Operating Income: | |||||
Operating Income | 2,176 | 1,458 | 4,201 | 2,869 | |
Unallocated Amounts: | |||||
Interest and Other Expense, net | 195 | 271 | 420 | 543 | |
Provision for Income Taxes | 493 | 406 | 865 | 689 | |
Unallocated Amounts | 688 | 677 | 1,285 | 1,232 | |
Net Income | 1,488 | 781 | 2,916 | 1,637 | |
Service Segment [Member] | |||||
Revenue: | |||||
Revenue | 19,902 | 18,239 | 39,227 | 36,721 | |
Gross Profit: | |||||
Gross Profit | 4,807 | 4,320 | 9,726 | 8,956 | |
Operating Expenses: | |||||
Operating Expenses | [1] | 3,682 | 3,530 | 7,533 | 7,281 |
Operating Income: | |||||
Operating Income | 1,125 | 790 | 2,193 | 1,675 | |
Distribution [Member] | |||||
Revenue: | |||||
Revenue | 18,977 | 17,688 | 36,310 | 35,485 | |
Gross Profit: | |||||
Gross Profit | 4,332 | 3,834 | 8,526 | 7,889 | |
Operating Expenses: | |||||
Operating Expenses | [1] | 3,281 | 3,166 | 6,518 | 6,695 |
Operating Income: | |||||
Operating Income | $ 1,051 | $ 668 | $ 2,008 | $ 1,194 | |
[1] | Operating expense allocations between segments are based on actual amounts, a percentage of revenues, headcount and management's estimates. |
BUSINESS ACQUISITIONS (Narrativ
BUSINESS ACQUISITIONS (Narrative) (Details) - Angel's Instrumentation, Inc. [Member] - USD ($) $ in Millions | 6 Months Ended | |
Sep. 29, 2018 | Mar. 31, 2018 | |
Business Acquisition [Line Items] | ||
Business acquisition, consideration transferred | $ 4.7 | |
Business acquisition, cash acquired | 0.1 | |
Business acquisition, contingent consideration unpaid | 0.6 | |
Business acquisition, other holdback amounts unpaid | $ 0.5 | |
Maximum [Member] | ||
Business Acquisition [Line Items] | ||
Intangible assets acquired, useful life | 10 years | |
Acquisition costs | $ 0.1 |
BUSINESS ACQUISITIONS (Purchase
BUSINESS ACQUISITIONS (Purchase Price Paid for Businesses Acquired) (Details) - USD ($) $ in Thousands | Sep. 29, 2018 | Mar. 31, 2018 |
Allocation of Purchase Price: | ||
Goodwill | $ 34,120 | $ 32,740 |
Angel's Instrumentation, Inc. [Member] | ||
Allocation of Purchase Price: | ||
Goodwill | 1,275 | |
Total | 2,775 | |
Plus: Current Assets | 787 | |
Non-Current Assets | 1,200 | |
Less: Current Liabilities | (24) | |
Total Purchase Price | 4,738 | |
Customer Base [Member] | Angel's Instrumentation, Inc. [Member] | ||
Allocation of Purchase Price: | ||
Intangible Assets | 1,400 | |
Covenant Not to Compete [Member] | Angel's Instrumentation, Inc. [Member] | ||
Allocation of Purchase Price: | ||
Intangible Assets | $ 100 |
BUSINESS ACQUISITIONS (Proforma
BUSINESS ACQUISITIONS (Proforma Information for Business Acquisitions) (Details) - USD ($) | 6 Months Ended | |
Sep. 29, 2018 | Sep. 23, 2017 | |
Business Combinations [Abstract] | ||
Total Revenue | $ 77,678 | $ 73,991 |
Net Income | $ 3,494 | $ 1,922 |
Basic Earnings Per Share | $ 0.49 | $ 0.27 |
Diluted Earnings Per Share | $ 0.48 | $ 0.27 |