1 unchanged sentence
INDEX TO FINANCIAL STATEMENTS
−Removed: Management's Annual Report on Internal Control over Financial Reporting 43
+Added: Report of Independent Registered Public Accounting Firm (PCAOB ID No.
Report of Independent Registered Public Accounting Firm (PCAOB ID 317) 48
5 unchanged sentences
Notes to Consolidated Financial Statements
−Removed: Management ’ s Annual Report on Internal Control over Financial Reporting
−Removed: Our management is responsible for establishing and maintaining adequate internal control over financial reporting.
−Removed: Our internal control system was designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States of America.
−Removed: In designing and evaluating our internal control system, we recognize that any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute, assurance of achieving the desired control objectives and that the effectiveness of any system has inherent limitations including, but not limited to, the possibility of human error and the circumvention or overriding of controls and procedures.
−Removed: Management, including the principal executive officer and the principal financial officer, is required to apply judgment in evaluating the cost-benefit relationship of possible controls and procedures.
−Removed: Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected in a timely manner.
−Removed: Effective December 10, 2024, the Company acquired Martin Calibration Inc.
−Removed: and effective April 15, 2024, the Company acquired Becnel Rental Tools, LLC.
−Removed: The financial results of these acquisitions are included in the consolidated financial statements as of and for the year ended March 29, 2025 and represent approximately 6% of total revenues and 6% of total assets excluding intangible assets and goodwill related to the acquisitions, respectively.
−Removed: Management is currently integrating Martin and Becnel into our operations and internal control processes and, pursuant to the SEC’s guidance that an assessment of a recently acquired business may be omitted from the scope of an assessment in the year of acquisition, the Company is excluding the internal control over financial reporting of Martin and Becnel from its evaluation of the effectiveness of the Company’s disclosure controls and procedures as of March 29, 2025.
−Removed: An evaluation was performed under the supervision and with the participation of our management, including our principal executive officer and our principal financial officer, of the effectiveness of the design and operation of our procedures and internal control over financial reporting using the framework and criteria described in the Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
−Removed: Based on this evaluation, our management, including our principal executive officer and our principal financial officer, concluded that our internal control over financial reporting was effective in providing reasonable assurance regarding the reliability of financial reporting and the preparation of our financial statements for external purposes in accordance with generally accepted accounting principles as of March 29, 2025.
−Removed: Freed Maxick, P.C., our independent registered public accounting firm, has audited and reported on the consolidated financial statements of the Company and the Company’s internal control over financial reporting, as stated in their report included in this Annual Report on Form 10-K.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the shareholders and the Board of Directors of Transcat, Inc.
−Removed: Opinions on the Financial Statements and Internal Control Over Financial Reporting
−Removed: We have audited the accompanying consolidated balance sheets of Transcat, Inc.
−Removed: and subsidiaries (the Company) as of March 29, 2025 and March 30, 2024, and the related consolidated statements of income, comprehensive income, cash flows and changes in shareholders' equity for each of the three years in the period ended March 29, 2025, and the related notes to the consolidated financial statements (collectively, the financial statements).
−Removed: We also have audited the Company’s internal control over financial reporting as of March 29, 2025, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013.
−Removed: In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of March 29, 2025 and March 30, 2024, and the results of its operations and its cash flows for each of the three years in the period ended March 29, 2025, in conformity with accounting principles generally accepted in the United States of America.
−Removed: Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of March 29, 2025, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013.
−Removed: As described in Management’s Annual Report on Internal Control Over Financial Reporting, management has excluded Becnel Rental Tools, LLC (Becnel) and Martin Calibration, Inc.
−Removed: (Martin) from its assessment of internal control over financial reporting as of March 29, 2025, because they were acquired by the Company in a purchase business combination during fiscal year 2025 .
−Removed: We have also excluded Becnel and Martin from our audit of internal control over financial reporting.
−Removed: Becnel and Martin are wholly owned subsidiaries.
−Removed: Becnel and Martin’s total assets, excluding intangible assets and goodwill related to the acquisitions, and total revenues represent approximately 6% and 6%, respectively, of the related consolidated financial statement amounts as of and for the year ended March 29, 2025.
+Added: Opinion on the Financial Statements
+Added: We have audited the accompanying consolidated balance sheet of Transcat, Inc.
+Added: and subsidiaries (the “Company”) as of March 28, 2026, the related consolidated statements of income, comprehensive income, changes in shareholders’ equity, and cash flows, for the fiscal year ended March 28, 2026, and the related notes (collectively referred to as the “financial statements”).
+Added: In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of March 28, 2026, and the results of its operations and its cash flows for the fiscal year ended March 28, 2026, in conformity with accounting principles generally accepted in the United States of America.
+Added: We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of March 28, 2026, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated May 27, 2026, expressed an adverse opinion on the Company's internal control over financial reporting because of material weaknesses.
+Added: Basis for Opinion
+Added: These financial statements are the responsibility of the Company’s management.
+Added: Our responsibility is to express an opinion on the Company’s financial statements based on our audit.
+Added: We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.
+Added: federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
+Added: We conducted our audit in accordance with the standards of the PCAOB.
+Added: Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
+Added: Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
+Added: Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
+Added: Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.
+Added: We believe that our audit provides a reasonable basis for our opinion.
+Added: Critical Audit Matter
+Added: The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.
+Added: The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
+Added: Acquisition of Essco Calibration Laboratory, LLC — Fair Value of Customer Base & Contracts Intangible Asset — Refer to Note 9 of the financial statements
+Added: Critical Audit Matter Description
+Added: The Company completed the acquisition of Essco Calibration Laboratory, LLC (“Essco”) on August 5, 2025.
+Added: This acquisition was accounted for as a business combination.
+Added: The Company accounts for acquisitions of entities or asset groups that qualify as businesses using the acquisition method of accounting.
+Added: Accordingly, the purchase consideration was allocated to the tangible and intangible assets acquired and liabilities assumed based on the estimated fair values as of the acquisition date, which are measured in accordance with fair value measurement principles.
+Added: As part of the purchase price allocation, the Company recorded $34.0 million for acquired customer base and contracts intangible assets based on estimated fair value.
+Added: We identified the fair value determination of the customer base and contracts intangible asset as a critical audit matter because of the significant estimates management made to determine such balances.
+Added: This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists, when performing audit procedures to evaluate the reasonableness of management’s assumptions related to future cash flows, attrition rate, and discount rate.
+Added: How the Critical Audit Matter Was Addressed in the Audit
+Added: Our audit procedures related to the customer base and contracts acquired included the following, among others:
+Added: We assessed the reasonableness of management's estimated cash flows by inquiring of management regarding its processes for developing projected financial information
+Added: We compared the cash flow projections to historical performance, and to historical and future projected performance of other guideline companies within the same industry
+Added: With the assistance of our fair value specialists, we evaluated the (1) valuation methodology, (2) mathematical accuracy of the valuation for customer base and contracts, and (3) the following significant valuation assumptions:
+Added: ○ Discount rate by developing a range of independent estimates and comparing those to the assumptions selected by management
+Added: ○ Attrition rate by testing the source information underlying the determination of the rate and recalculating the rate using the applicable underlying customer data
+Added: /s/ Deloitte & Touche LLP
+Added: Rochester, NY
+Added: We have served as the Company's auditor since 2025.
+Added: Report of Independent Registered Public Accounting Firm
+Added: To the Shareholders and the Board of Directors of Transcat, Inc.
+Added: Opinions on the Financial Statements
+Added: We have audited the accompanying consolidated balance sheet of Transcat, Inc.
+Added: and subsidiaries (the Company) as of March 29, 2025, and the related consolidated statements of income, comprehensive income, cash flows and changes in shareholders' equity for each of the two years in the period ended March 29, 2025, and the related notes to the consolidated financial statements (collectively, the financial statements).
+Added: In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of March 29, 2025, and the results of its operations and its cash flows for each of the two years in the period ended March 29, 2025, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinions
The Company’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting.
−Removed: Our responsibility is to express an opinion on the Company’s financial statements and an opinion on the Company’s internal control over financial reporting based on our audits.
+Added: Our responsibility is to express an opinion on the Company’s financial statements based on our audits.
We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with U.S.
1 unchanged sentence
We conducted our audits in accordance with the standards of the PCAOB.
−Removed: Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.
+Added: Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
Our audits of the financial statements included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
1 unchanged sentence
Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.
−Removed: Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.
Our audits also included performing such other procedures as we considered necessary in the circumstances.
−Removed: We believe that our audits provide a reasonable basis for our opinions.
−Removed: Definition and Limitations of Internal Control Over Financial Reporting
−Removed: A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
−Removed: A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
−Removed: (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;
−Removed: and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company's assets that could have a material effect on the financial statements.
−Removed: Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
−Removed: Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
+Added: We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
17 unchanged sentences
This included testing the completeness and accuracy of source information used, mathematical accuracy of management’s calculations, and evaluating the reasonableness and consistency of methodology and assumptions used.
+Added: We served as the Company’s auditor from 2012 to 2025.
/s/ Freed Maxick P.C.
(f/k/a Freed Maxick CPAs, P.
−Removed: We have served as the Company’s auditor since 2012.
Rochester, New York
1 unchanged sentence
CONSOLIDATED STATEMENTS OF INCOME
−Removed: (In Thousands, Except Per Share Amounts)
+Added: (Amounts in Thousands, Except Per Share Amounts)
For the Fiscal Years Ended
44 unchanged sentences
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
−Removed: (In Thousands)
+Added: (Dollars in Thousands)
For the Fiscal Years Ended
4 unchanged sentences
Other, net of tax effects of $ 73 , $ (24) and $ (26) for the years ended March 28, 2026, March 29, 2025 and March 30, 2024 respectively.
+Added: ( 161 ) 71 99
Total Other Comprehensive (Loss)/Income
5 unchanged sentences
CONSOLIDATED BALANCE SHEETS
−Removed: (In Thousands, Except Share and Per Share Amounts)
+Added: (Amounts in Thousands, Except Share and Per Share Amounts)
Current Assets:
1 unchanged sentence
$ 4,942 $ 1,517
−Removed: Marketable Securities
−Removed: Accounts Receivable, less allowance for credit losses of $ 659 and $ 544 as of March 29, 2025 and March 30, 2024, respectively
+Added: Accounts Receivable, less allowance for credit losses of $ 851 and $ 659
65,170 55,941
Other Receivables
−Removed: Inventory, net
13,705 14,483
16 unchanged sentences
21,697 15,466
−Removed: Income Taxes Payable
Current Portion of Long-Term Debt
2 unchanged sentences
Long-Term Debt
+Added: 99,885 30,892
Deferred Tax Liabilities, net
4 unchanged sentences
179,868 98,362
+Added: Commitments and Contingencies (Note 8)
Shareholders' Equity:
14 unchanged sentences
CONSOLIDATED STATEMENTS OF CASH FLOWS
−Removed: (In Thousands)
+Added: (Dollars in Thousands)
For the Fiscal Years Ended
4 unchanged sentences
Net (Gain) Loss on Disposal of Property and Equipment
+Added: 232 ( 31 ) 53
+Added: Noncash Lease Expense
+Added: 6,021 3,447 765
Deferred Income Taxes
3 unchanged sentences
Gain on Sale of Assets
+Added: Amortization of Deferred Financing Costs
Provision for Accounts Receivable and Inventory Reserves
11 unchanged sentences
924 ( 1,118 ) 3,102
+Added: Lease Liabilities
+Added: ( 5,842 ) ( 3,243 ) ( 470 )
Income Taxes Payable
5 unchanged sentences
( 15,298 ) ( 13,197 ) ( 13,280 )
−Removed: Proceeds from Sale of Property and Equipment
Business Acquisitions, net of cash acquired
6 unchanged sentences
Cash Flows from Financing Activities:
−Removed: Proceeds from (Repayment of) Revolving Credit Facility, net
+Added: Proceeds From Revolving Credit Facility, net of lender fees
156,675 68,630 58,068
+Added: Repayment of Revolving Credit Facility
+Added: ( 88,086 ) ( 37,739 ) ( 100,781 )
Repayments of Term Loan
( 1,816 ) ( 2,338 ) ( 2,248 )
+Added: Payments of Deferred Financing Costs
+Added: Principal Payments on Finance Leases
Issuance of Common Stock, net of direct costs
14 unchanged sentences
Cash paid during the fiscal year for:
+Added: Interest, net
$ 4,184 $ ( 151 ) $ 1,240
4 unchanged sentences
$ - $ 45,410 $ 34,769
−Removed: Assets Acquired and Liabilities Assumed in Business Combinations:
−Removed: Contingent consideration treated as equity related to acquisitions
−Removed: $ 750 $ - $ -
−Removed: Accrued holdback consideration related to acquisitions
+Added: Balance Sheet Reclassification of Inventory to Property and Equipment
$ 741 $ 443 $ 230
4 unchanged sentences
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS ’ EQUITY
−Removed: (In Thousands)
+Added: (Amounts in Thousands)
$0.50 Par Value
5 unchanged sentences
1,267 634 116,724 - - 117,358
+Added: Direct costs of Stock Offering
+Added: - - ( 5,323 ) - - ( 5,323 )
Repurchase of Common Stock
2 unchanged sentences
60 30 4,482 - - 4,512
−Removed: Other Comprehensive Loss
+Added: Other Comprehensive Income
- - - 251 - 251
4 unchanged sentences
466 233 47,800 - - 48,033
−Removed: Direct costs of Stock Offering
−Removed: - - ( 5,323 ) - - ( 5,323 )
Repurchase of Common Stock
2 unchanged sentences
40 20 3,228 - - 3,248
−Removed: Other Comprehensive Income
+Added: Other Comprehensive Loss
- - - ( 520 ) - ( 520 )
8 unchanged sentences
- - 7,549 - - 7,549
−Removed: Other Comprehensive Loss
+Added: Other Comprehensive Income
- - - 546 - 546
9 unchanged sentences
(“Transcat,” “we,” “us,” “our” or the “Company”) is a leading provider of accredited calibration services, cost control and optimization services, and distribution and rental of value-added professional grade handheld test, measurement, and control instrumentation.
−Removed: 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.
+Added: The Company is focused on providing services and products to highly regulated industries, particularly the life science industry, which includes pharmaceutical, biotechnology, medical devices and other FDA-regulated businesses.
Additional industries served include industrial manufacturing;
4 unchanged sentences
The consolidated financial statements of Transcat include the accounts of Transcat and the Company’s wholly-owned subsidiaries, Transcat Canada, Inc, Cal OpEx Limited (d/b/a Transcat Ireland), Cal OpEx Inc.
−Removed: (d/b/a NEXA EAM), Axiom Test Equipment, LLC, Becnel Rental Tools, LLC and Martin Calibration, Inc.
−Removed: All interco mpany balances and transactions have been eliminated in consolidation.
+Added: (d/b/a NEXA EAM), Axiom Test Equipment, LLC, Becnel Rental Tools, LLC, Martin Calibration, LLC, and Essco Calibration Laboratory, LLC.
+Added: All intercompany balances and transactions have been eliminated in consolidation.
Use of Estimates:
The preparation of Transcat’s Consolidated Financial Statements in accordance with accounting principles generally accepted in the United States (“GAAP”) requires that the Company make estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period.
−Removed: Significant estimates and assumptions are used for, but not limited to, allowance for credit losses and returns, inventory reserves, estimated levels of achievement for performance-based restricted stock units, fair value of stock options, depreciable lives of fixed assets, estimated lives of major catalogs and intangible assets, fair value of the goodwill reporting units, and the valuation of assets acquired, liabilities assumed and consideration transferred in business acquisitions.
+Added: Significant estimates and assumptions are used for, but not limited to, revenue recognition, estimated lives of intangible assets, fair value of the Company's reporting units, income taxes, and the valuation of assets acquired, liabilities assumed and consideration transferred in business acquisitions.
Future events and their effects cannot be predicted with certainty;
6 unchanged sentences
In a 53 -week fiscal year, the last quarter is a 14 -week period.
−Removed: The fiscal year ended March 29, 2025 ("fiscal year 2025 ") consisted of 52 weeks and fiscal year 2024 which ended on March 30, 2024 consisted of 53 weeks.
+Added: The fiscal year ended March 28, 2026 and March 29, 2025 ("fiscal year 2026 " and "fiscal year 2025 ", respectively) consisted of 52 weeks and the fiscal year ended on March 30, 2024 ("fiscal year 2024" ) consisted of 53 weeks.
Cash and Cash Equivalents:
Cash equivalents consist of highly liquid investments with an original maturity when purchased of three months or less and are stated at cost, which approximates fair value.
−Removed: Marketable Securities:
−Removed: Marketable securities consist of highly liquid investments with an original maturity when purchased of more than three months and are stated at fair value on the Consolidated Balance Sheets.
−Removed: These securities are considered trading securities.
−Removed: Earnings on the marketable securities are included in interest income in the Consolidated Statements of Income.
Accounts Receivable:
−Removed: Accounts receivable represent amounts due from customers in the ordinary course of business.
−Removed: These amounts are recorded net of the allowance for credit losses and returns in the Consolidated Balance Sheets.
+Added: Accounts receivable represents amounts due from customers in the ordinary course of business.
+Added: These amounts are recorded net of the allowance for credit losses in the Consolidated Balance Sheets.
The allowance for credit losses is based upon the expected collectability of accounts receivable.
1 unchanged sentence
After all attempts to collect a receivable have failed, the receivable is written-off against the allowance for credit losses.
−Removed: The accounts receivable bala nce, less the allowance, as of March 25, 2023, was $ 44.7 million.
+Added: A summary of changes in the Company’s allowance for credit losses is as follows (amounts in thousands):
+Added: Allowance for
+Added: Credit Losses
+Added: Allowance for Credit Losses at March 30, 2024
+Added: Additions from Acquisitions
+Added: Charges to Earnings
+Added: Effect of Foreign Exchange on Allowance for Credit losses
+Added: Allowance for Credit Losses at March 29, 2025
+Added: Additions from Acquisitions
+Added: Charges to Earnings
+Added: Effect of Foreign Exchange on Allowance for Credit losses
+Added: Allowance for Credit Losses at March 28, 2026
Inventory consists of products purchased for resale and is valued at the lower of average cost or net realizable value.
+Added: In the normal course of business, certain inventory items are transferred to property and equipment to be rented to customers.
Costs are determined using the average cost method of inventory valuation.
The Company performs physical inventory counts and cycle counts on inventory throughout the year and adjusts the recorded balance to reflect the results.
−Removed: Inventory is reduced by a reserve for items not saleable at or above cost by applying a specific loss fact or, based on historical experience, to specific categories of inventory.
−Removed: The Company evaluates the adequacy of the reserve on a quarterly basis.
−Removed: The Company had reserves for inventory losses totaling $ 0.2 million at March 29, 2025 and $ 0.3 million at March 30, 2024 .
+Added: Inventory is reduced for items not saleable at or above cost by applying a specific loss factor, based on historical experience, to specific categories of inventory.
+Added: The Company evaluates the valuation of inventory on a quarterly basis.
+Added: The Company recorded inventory valuation adjustments totaling $ 0.2 million at March 28, 2026 and March 29, 2025 .
Property and Equipment, Depreciation and Amortization:
5 unchanged sentences
Leasehold Improvements
+Added: In the normal course of business, certain items that have been capitalized as property and equipment may be sold to customers as used equipment.
Property and equipment determined to have no value are written off at their then remaining net book value.
12 unchanged sentences
Goodwill represents the excess of the purchase price over the fair values of the underlying net assets of an acquired business.
−Removed: The Company tests goodwill for impairment for each reporting unit on an annual basis during the fourth quarter of its fiscal year, or immediately if conditions indicate that such impairment could exist.
−Removed: The Company is permitted, but not required, to qualitatively assess indicators of a reporting unit’s fair value to determine whether it is necessary to perform the two -step goodwill impairment test.
−Removed: If a quantitative test is deemed necessary, a discounted cash flow analysis is prepared to estimate fair val ue.
−Removed: The Company determined that no impairment was indicated as of March 29, 2025 and March 30, 2024 .
−Removed: Intangible assets consists of (amount in thousands):
−Removed: Customer Base
−Removed: $ 84,755 $ 45,725
−Removed: Covenant not to Compete
−Removed: Tradenames/Trademarks
−Removed: Total Intangibles
+Added: Goodwill is allocated to the Company's two reporting units:
+Added: Service and Distribution.
+Added: The Company tests goodwill for impairment for each reporting unit on an annual basis as of the first day of the fourth quarter of each fiscal year, or more frequently if conditions indicate that such impairment could exist.
+Added: The Company is permitted, but not required, to qualitatively assess indicators of a reporting unit’s fair value, as it did in fiscal 2025, or the Company can elect to perform a quantitative analysis, as it did for fiscal 2026.
+Added: The Company estimated the fair values of each reporting unit for fiscal 2026 utilizing the income and market approaches, weighted equally, to prepare the analysis.
+Added: The projected cash flows used in the analysis reflect management’s expectations of revenue growth and margin expansion based on historical performance, anticipated customer demand, and current market conditions.
+Added: The weighted-average cost of capital ("WACC") for the Service and Distribution reporting units was 10 %, and the long-term growth rate assumed was 3 %.
+Added: Based on the results of the Company's impairment assessments in fiscal 2026 and fiscal 2025, the Company was able to conclude that it was more likely than not that the fair values of the reporting units exceeded the carrying values.
+Added: A summary of changes in the Company’s goodwill is as follows (amounts in thousands):
+Added: Book Value as of March 30, 2024
38,216 67,369 105,585
−Removed: Accumulated Amortization
21,783 49,896 71,679
−Removed: Total Intangibles, net
+Added: Currency Translation Adjustment
- ( 336 ) ( 336 )
−Removed: Intangible assets, namely customer base and covenants not to compete, represent an allocation of purchase price to identifiable intangible assets of an acquired business.
−Removed: Intangible assets are evaluated for impairment when events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable.
−Removed: A summary of changes in the Company’s goodwill and intangible assets is as follows (amounts in thousands):
−Removed: Intangible Assets
−Removed: Net Book Value as of March 26, 2022
+Added: Book Value as of March 29, 2025
59,999 116,929 176,928
2 unchanged sentences
- ( 287 ) ( 287 )
−Removed: - - - ( 199 ) ( 4,255 ) ( 4,454 )
Currency Translation Adjustment
+Added: Book Value as of March 28, 2026
$ 59,999 $ 158,186 $ 218,185
−Removed: Net Book Value as of March 25, 2023
+Added: As of March 28, 2026, no accumulated impairment loss has been recognized for the Company's goodwill.
+Added: The gross carrying amount and accumulated amortization of Transcat's acquired identifiable intangible assets as of March 28, 2026 were as follows (in thousands):
+Added: Gross Carrying
+Added: Customer Base
$ 118,844 $ ( 46,859 ) $ 71,985
+Added: Covenant not to Compete
3,611 ( 3,258 ) 353
+Added: Tradenames/Trademarks
6,740 ( 1,396 ) 5,344
−Removed: Currency Translation Adjustment
905 ( 881 ) 24
−Removed: Net Book Value as of March 30, 2024
+Added: Intangible Assets, net
$ 130,100 $ ( 52,394 ) $ 77,706
+Added: The gross carrying amount and accumulated amortization of Transcat's acquired identifiable intangible assets as of March 29, 2025 were as follows (in thousands):
+Added: Gross Carrying
+Added: Customer Base
$ 84,755 $ ( 34,531 ) $ 50,224
+Added: Covenant not to Compete
3,603 ( 2,866 ) 737
−Removed: Currency Translation Adjustment
+Added: Tradenames/Trademarks
4,040 ( 263 ) 3,777
−Removed: Net Book Value as of March 29, 2025
905 ( 866 ) 39
−Removed: The intangible assets are being amortized on an accelerated basis over their estimated useful lives of up to 15 years.
−Removed: Amortization expense relating to in tangible assets is expected to be $ 10.6 million in fiscal year 2026, $ 8.0 million in fiscal year 2027, $ 6.7 million in fiscal year 2028, $ 5.7 million in fiscal year 2029 and $ 4.7 million in fiscal year 2030.
−Removed: Catalog Costs:
−Removed: Transcat capitalizes the cost of each master catalog mailed and amortizes the cost over the respective catalog’s estimated product ive life.
−Removed: The Company reviews response results from catalog mailings on a continuous basis, and if warranted, modifies the period over which costs are recognized.
−Removed: The Company amortizes the cost of each master catalog over an eighteen -month period and amortizes the cost of each catalog supplement over a three -month period.
−Removed: There were no unamortized catalog costs at March 29, 2025 or at March 30, 2024 .
+Added: Intangible Assets, net
+Added: $ 93,303 $ ( 38,526 ) $ 54,777
+Added: Intangible assets, namely customer base, covenants not to compete, and tradenames/trademarks, represent an allocation of purchase price to identifiable intangible assets of an acquired business.
+Added: Intangible assets are evaluated for impairment when events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable.
+Added: There were no indicators of impairment for fiscal 2026 or fiscal 2025.
+Added: Amortization expense relating to intangible assets was $ 13.8 million in fiscal year 2026 and $ 8.4 million in fiscal year 2025 and is recorded in Selling, Marketing and Warehouse Expenses in the Company's Consolidated Statements of Income.
+Added: Intangible amortization for future periods is expected to be the following (in $ millions):
Deferred Taxes:
5 unchanged sentences
Fair Value of Financial Instruments:
+Added: The Company measures certain financial and nonfinancial assets and liabilities at fair value on a recurring and nonrecurring basis in accordance with ASC 820, Fair Value Measurement .
+Added: Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price).
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.
−Removed: Level 1 uses observable inputs such as quoted prices in active markets;
+Added: Level 1 uses quoted prices in active markets for identical assets and liabilities;
Level 2 uses inputs other than quoted prices in active markets that are either directly or indirectly observable;
−Removed: 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.
−Removed: The carrying amount of debt on the Consolidated Balance Sheets approximates fair value due to variable interest rate pricing on a portion of the debt with the balance bearing an interest rate approximating current market rates, and the carrying amounts for cash and cash equivalents, marketable securities, accounts receivable and accounts payable approximate fair value due to their short-term nature.
−Removed: Investment assets, which fund the Company’s non-qualified deferred compensation plan, consist of mutual funds and are valued based on Level 1 inpu ts.
−Removed: At both March 29, 2025 and March 30, 2024 , investment assets totaled $ 0.1 million and are included as a component of other assets (non-current) on the Consolidated Balance Sheets.
+Added: 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 about assumptions a market participant would use, developed based on the best information available under the circumstances.
+Added: The carrying amount of debt on the Consolidated Balance Sheets approximates fair value due to variable interest rate pricing that approximates current market rates, and the carrying amounts for cash and cash equivalents, accounts receivable and accounts payable approximate fair value due to their short-term nature.
+Added: Investment assets, which funded the Company’s non-qualified deferred compensation plan, consist of mutual funds and are valued based on Level 1 inputs.
+Added: At March 28, 2026, there were no investment assets.
+Added: At March 29, 2025, investment assets totaled $ 0.1 million and are included as a component of other assets (non-current) on the Consolidated Balance Sheets.
+Added: Certain nonfinancial assets and liabilities are measured at fair value on a nonrecurring basis, including assets acquired and liabilities assumed in connection with business combinations and assets subject to impairment testing.
+Added: Valuations of identifiable intangible assets (such as customer relationships and trade names) and certain liabilities typically involve the use of valuation techniques such as the income approach (e.g., discounted cash flow or relief-from-royalty methods) and may incorporate significant unobservable inputs, including:
+Added: (i) forecasted revenues and cash flows, (ii) discount rates, (iii) customer attrition rates, and (iv) royalty rates and useful lives.
+Added: These measurements are generally classified within Level 3 of the fair value hierarchy.
Stock-Based Compensation:
5 unchanged sentences
The Company estimates forfeiture rates based on its historical experience.
−Removed: During fiscal years 2025 , 2024 and fiscal year ended March 25, 2023 ( "fiscal year 2023" ), the Company recorded non-cash stock-based compensation cost in the amount of $ 3.2 million, $ 4.5 million and $ 3.4 million, respectively, in the Consolidated Statements of Income.
+Added: During fiscal years 2026 , 2025 and 2024, the Company recorded non-cash stock-based compensation cost in the amount of $ 7.5 million, $ 3.2 million and $ 4.5 million, respectively, in the Consolidated Statements of Income.
Revenue Recognition:
−Removed: Revenue is recognized in accordance with Accounting Standards Codification ("ASC") Topic 606, Revenue from Contracts with Customers and Topic 842, Leases.
−Removed: Distribution product sales are recorded when an order’s title and risk of loss transfers to the customer, which is generally upon shipment.
−Removed: 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.
−Removed: 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.
−Removed: Some Service revenue is generated from managing customers’ calibration programs in which the Company recognizes revenue over time using the time-elapsed output method as this portrays the transfer of control to the customer.
−Removed: Revenue is measured as the amount of consideration the Company expects to receive in exchange for product shipped or services performed.
−Removed: Rental revenue is accounted for as an operating lease.
−Removed: We recognize revenue from equipment rentals in the period earned, regardless of the timing of billing to customers.
−Removed: A rental contract includes rates for daily, weekly or monthly use, and rental revenues are earned on a daily basis as rental contracts remain outstanding.
−Removed: As some rental contracts can extend across multiple reporting periods, we record unbilled rental revenue and deferred rental revenue at the end of a reporting period so rental revenue earned is appropriately stated for the periods presented.
−Removed: Sales taxes and other taxes billed and collected from customers are excluded from revenue.
−Removed: The Company generally invoices its customers for freight, shipping, and handling charges.
−Removed: Freight billed to customers is included in revenue.
−Removed: Shipping and handling is not included in revenue.
−Removed: Provisions for customer returns are provided for in the period the related revenue is recorded based upon historical data.
−Removed: Under ASC Topic 606, Revenue from Contracts with Customers, we use judgments that could potentially impact both the timing of our satisfaction of performance obligations and our determination of transaction prices used in determining revenue recognized.
−Removed: Such judgments include considerations in determining our transaction prices and when our performance obligations are satisfied for our standard product sales that include general payment terms that are between net 30 and 90 days.
−Removed: Revenue recognized from prior period performance obligations for fiscal year 2025 was immaterial.
−Removed: As of March 29, 2025 , the Company had no unsatisfied performance obligations for contracts with an original expected duration of greater than one year.
−Removed: Pursuant to ASC Topic 606, 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.
−Removed: Deferred revenue, unbilled revenue and deferred contract costs recorded on our Consolidated Balance Sheets as of March 29, 2025 and March 30, 2024 were immaterial.
−Removed: See Note 7 for disaggregated revenue information.
+Added: The Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers .
+Added: The Company generates revenue from distribution product sales, equipment rental arrangements, and service offerings.
+Added: The following is a description of principal activities from which the Company generates its revenue and how revenue is recognized:
+Added: Service Revenue
+Added: Calibration and other related service activities - Service revenue is generated from calibration, repair, inspection, analytical qualifications, preventative maintenance, and other related service activities, including third -party managed services.
+Added: Revenue is generally recognized at a point in time when control transfers to the customer in accordance with the contract terms.
+Added: For certain service arrangements involving managing customers’ calibration programs and technical, consulting, and staffing solutions, we recognize revenue over time, using the time-elapsed output method (for example, hours worked), as the customer simultaneously receives and consumes the benefits of the Company’s performance.
+Added: These service arrangements are typically less than 12 months, and are primarily recognized over time, including in certain cases using the “right to invoice” practical expedient.
+Added: Distribution Sales
+Added: Product Sales - Revenue from product sales is recognized at a point in time when control transfers to the customer, which often occurs upon shipment, when title and risk of loss pass to the customer.
+Added: Equipment Rental - These arrangements provide customers with the right to use specified equipment for defined contractual periods.
+Added: These contracts vary in duration with offerings including weekly, monthly and other extended durations.
+Added: The related performance obligation is generally satisfied over time, and rental revenue is recognized using the time-elapsed output method, as this pattern depicts the transfer of control to the customer.
+Added: Certain rental contracts provide a stand-ready obligation for equipment, and as a result, consideration is variable and based on the actual duration of use.
+Added: Depending upon the structure of a particular arrangement, we (i) recognize revenue as each distinct service period is performed, (ii) recognize the estimate of variable consideration ratably over the period to which it relates, or (iii) apply the ‘right to invoice’ practical expedient and recognize revenue based on the amount invoiced to the customer during the period.
+Added: Revenue is measured based on the transaction price, which represents the amount of consideration the Company expects to receive in exchange for satisfying its performance obligations.
+Added: Transaction prices are generally fixed and stated in customer contracts, which typically include payment terms ranging from net 30 to 90 days.
+Added: Provisions for customer returns are estimated and recorded in the same period as the related revenue based on historical experience and have been immaterial.
+Added: Sales taxes and other similar taxes collected on behalf of governmental authorities are excluded from revenue.
+Added: The Company generally bills customers for freight charges, which are included in revenue.
+Added: Shipping and handling activities are considered fulfillment activities rather than separate performance obligations.
+Added: For rental and certain service arrangements that extend across reporting periods, the Company records unbilled revenue or deferred revenue, as applicable, to reflect revenue recognized in advance of or subsequent to billing.
+Added: Deferred revenue, unbilled revenue, and deferred contract costs recorded on the Company’s Consolidated Balance Sheets as of March 28, 2026 and March 29, 2025 were immaterial.
+Added: Revenue recognized during fiscal year 2026 from performance obligations satisfied in prior periods was immaterial.
+Added: The application of ASC 606 requires management to exercise judgment in identifying performance obligations, determining whether such obligations are satisfied at a point in time or over time, and estimating transaction prices.
+Added: These judgments primarily relate to product shipment terms, service completion criteria, and the determination of the appropriate pattern of revenue recognition for rental and managed service arrangements.
+Added: Estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period was $ 7.3 million and $ 3.3 million as of March 28, 2026 and March 29, 2025, respectively.
+Added: These are expected to be recognized revenue in one year or less.
+Added: As of March 28, 2026, the Company had a de minimis amount of unsatisfied performance obligations for contracts with an original expected duration of greater than one year.
+Added: Accordingly, the Company has elected to not disclose information about remaining performance obligations.
+Added: See Note 7 for disaggregated revenue information related to the Company's segments and geographical data.
The following table presents a summary of the Company's net sales by revenue recognition method as a percentage of total net sales:
8 unchanged sentences
Purchase rebates are calculated and recorded quarterly based upon the volume of purchases with specific vendors during the quarter.
−Removed: Point of sale rebate programs that a re based on year-over-year sales performance on a calendar year basis are recorded as earned, on a quarterly basis, based upon the expected level of annual achievement.
+Added: Point of sale rebate programs that are based on year-over-year sales performance on a calendar year basis are recorded as earned, on a quarterly basis, based upon the expected level of annual achievement.
Point of sale rebate programs that are based on year-over-year sales performance on a quarterly basis are recorded as earned in the respective quarter.
The Company recorded vendor rebates of $ 1.4 million, $ 0.9 million and $ 0.6 million in fiscal years 2026, 2025 , and 2024 , respectively, as a reduction of cost of distribution sales.
−Removed: Cooperative Advertising Income:
−Removed: The Company participates in co-op advertising programs with certain of its vendors.
−Removed: The Company records cash consideration received from these vendors for advertising as a reduction of cost of distribution sales.
−Removed: The Company recorded consider ation in the amount of $ 0.9 million, $ 1.1 million and $ 1.0 million in fiscal years 2025 , 2024 and 2023 , respectively, in connection with these programs.
Advertising Costs:
−Removed: Advertising costs, other than catalog costs, are expensed as they are incurred and are included in Selling, Marketing and Warehouse Expenses in the Consolidated Statements of Incom e.
+Added: Advertising costs, other than catalog costs, are expensed as they are incurred and are included in Selling, Marketing and Warehouse Expenses in the Consolidated Statements of Income.
Advertising costs were approximately $ 2.6 million, $ 2.0 million and $ 1.6 million in fiscal years 2026 , 2025 and 2024 , respectively.
Shipping and Handling Costs:
−Removed: Freight expense and direct shipping costs are included in the cost of revenu e.
+Added: Freight expense and direct shipping costs are included in the cost of revenue.
These costs totaled approximately $ 3.7 million, $ 3.4 million and $ 3.2 million in fiscal years 2026 , 2025 and 2024 , respectively.
−Removed: D irect handling costs, the majority of which represent direct compensation of employees who pick, pack, and prepare merchandise for shipment to customers, are reflected in selling, marketing and ware house expenses.
+Added: Direct handling costs, the majority of which represent direct compensation of employees who pick, pack, and prepare merchandise for shipment to customers, are reflected in selling, marketing and warehouse expenses.
Direct handling costs were approximately $ 0.6 million, $ 0.6 million and $ 0.5 million in fiscal years 2026 , 2025 and 2024 , respectively.
6 unchanged sentences
The net foreign currency loss was $ 0.2 million in fiscal year 2026 , a loss of $ 0.1 million in fiscal year 2025 and a loss of $ 0.1 million in fiscal year 2024 .
−Removed: The Company continually utilizes short-term foreign exchange forward contracts to reduce the risk that its future earnings denominated in Canadian dollars would be adversely affected by changes in currency exchange rates.
−Removed: The Company does not apply hedge accounting and therefore the net change in the fair value of the contracts, which totaled a gain than $ 0.2 million, a loss of $ 0.1 million and a gain of $ 0.4 million in fiscal years 2025 , 2024 and 2023 , respectively, was recognized as a component of Interest and Other Expenses, net in the Consolidated Statements of Income.
−Removed: 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.
−Removed: On March 29, 2025 , the Company had a foreign exchange contract, which matured in April 2025, outstanding in the notional amount of $ 1.1 million.
−Removed: This contract was subsequently renewed and remains in place.
+Added: The Company has utilized short-term foreign exchange forward contracts to reduce the risk that its future earnings denominated in Canadian dollars would be adversely affected by changes in currency exchange rates.
+Added: The Company did not apply hedge accounting and therefore the net change in the fair value of the contracts, which totaled a loss of less than $ 0.1 million, a gain of $ 0.2 million and a loss of $ 0.1 million in fiscal years 2026 , 2025 and 2024 , respectively, was recognized as a component of Other (Income) Expense in the Consolidated Statements of Income.
+Added: The change in the fair value of the contracts was offset by the change in fair value on the underlying accounts receivables denominated in Canadian dollars being hedged.
+Added: On March 28, 2026 , the Company did not hold a foreign exchange contract.
The Company does not use hedging arrangements for speculative purposes.
5 unchanged sentences
See Note 5 for further discussion on the Company’s post-retirement plan.
−Removed: The Company has a non-qualified deferred com pensation plan for the benefit of certain management employees and non-employee directors.
+Added: The Company has a non-qualified deferred compensation plan for the benefit of certain management employees and non-employee directors.
Investment assets, which fund the Company’s non-qualified deferred compensation plan, consist of mutual funds.
The unrecognized portion of the gain or loss on plan assets is included in the Consolidated Statements of Income.
−Removed: At March 29, 2025 , accumulated other comprehensive loss consisted of cumulative currency translation losses of $ 1.5 million, unrecognized prior service costs, net of tax, of less than $ 0.1 million and an unrealized gain on other assets, net of tax, of less than $ 0.1 million.
+Added: At March 28, 2026 , accumulated other comprehensive loss consisted of cumulative currency translation losses of $ 0.8 million, unrecognized prior service costs, net of tax, of $ 0.2 million and an unrealized loss on other assets, net of tax, of less than $ 0.1 million.
At March 29, 2025 , accumulated other comprehensive loss consisted of cumulative currency translation losses of $ 1.5 million, unrecognized prior service costs, net of tax, of $ 0.1 million and an unrealized gain on other assets, net of tax, of less than $ 0.1 million.
1 unchanged sentence
Basic earnings per share of the Company's common stock, par value $ 0.50 per share ("common stock"), are computed based on the weighted average number of shares of common stock outstanding during the period.
−Removed: Diluted earnings per share of common stock reflect the assumed conversion of stock options and unve sted restricted stock units using the treasury stock method in periods in which they have a dilutive effect.
+Added: 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, proceeds received from the exercise of options and unvested restricted stock units 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.
14 unchanged sentences
Accrued Incentives
−Removed: Current Portion of Lease Liabilities
+Added: Current Portion of Lease Liabilities - Operating
+Added: Current Portion of Lease Liabilities - Financing
Accrued Acquisition Holdbacks
Accrued Sales Tax
−Removed: Accrued Contingent Consideration
Other Current Liabilities
9 unchanged sentences
Recently Adopted Accounting Pronouncements:
−Removed: In November 2023, the FASB issued ASU 2023 - 07 “Segment Reporting (Topic 280 ):
−Removed: Improvements to Reportable Segment Disclosures” to expand the disclosure requirements for reportable segments.
−Removed: The standard expands reportable segment disclosure requirements for public business entities primarily through enhanced disclosures about significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment operating income.
−Removed: The Company adopted ASU 2023 - 07 in fiscal year 2025.
−Removed: The adoption of this new accounting standard did not have an impact on the Company's res ults of operations, financial position or cash flows.
−Removed: See Note 7 to our Consolidated Financial Statements in this report for financial information for these segments.
−Removed: Recent Accounting Guidance Not Yet Adopted:
−Removed: In December 2023, the FASB issued ASU 2023 - 09, Income Taxes (Topic 740 ):
+Added: In December 2023, the FASB issued Accounting Standards Update ("ASU") 2023 - 09, Income Taxes (Topic 740 ):
Improvements to Income Tax Disclosures.
1 unchanged sentence
ASU 2023 - 09 is effective for annual periods beginning in fiscal 2026, with early adoption permitted.
−Removed: The adoption of the ASU is not expected to have a material impact on the Company’s financial statement disclosures.
+Added: The prospective adoption of the ASU did not have a material impact on the Company’s financial statement disclosures.
+Added: Recent Accounting Guidance Not Yet Adopted:
In November 2024, the FASB issued ASU 2024 - 03 “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220 - 40 ):
2 unchanged sentences
The adoption of the ASU is not expected to have a material impact on the Company’s financial statement disclosures.
+Added: In July 2025, the FASB issued ASU 2025 - 05 “Financial Instruments—Credit Losses (Topic 326 ):
+Added: Measurement of Credit Losses for Accounts Receivable and Contract Assets,” which introduces a practical expedient for the application of the current expected credit loss model to current accounts receivable and contract assets.
+Added: ASU 2025 - 05 is effective for interim and annual reporting periods beginning in fiscal 2027, with early adoption permitted.
+Added: The adoption of the ASU is not expected to have a material impact on the Company’s financial statement disclosures.
+Added: The Company has reviewed all other recently issued, but not yet effective, accounting pronouncements and has determined that there are no standards that are expected to have a material impact on its consolidated financial statements or related disclosures.
Reclassification of Amounts:
Certain reclassifications of financial information for prior fiscal years have been made to conform to the presentation for the current fiscal year.
−Removed: NOTE 2 – PROPERTY AND EQUIPMENT
+Added: Specifically, the Company:
+Added: ( 1 ) separated the noncash lease expense from the change in lease liabilities in the operating activities section of the cash flow statement;
+Added: ( 2 ) separated proceeds from revolving credit facility from repayments of the revolving credit facility in the financing activities section of the cash flow statement;
+Added: ( 3 ) separated accumulated amortization by intangible asset class in Note 1;
+Added: ( 4 ) enhanced the segment disclosure to include additional data for each segment in Note 7;
+Added: and ( 5 ) updated prior periods' acquisition disclosures to include the useful lives of the intangible assets in Note 9.
+Added: These changes in presentation did not affect net income, operating income, total assets, liabilities, or stockholders’ equity for any period presented.
+Added: NOTE 2 – PROPERTY AND EQUIPMENT, NET
Property and equipment consists of (amounts in thousands):
5 unchanged sentences
Leasehold Improvements
+Added: Fixed Assets in Process
Total Property and Equipment
4 unchanged sentences
$ 57,801 $ 50,024
−Removed: Total depreciation and amortization expense relating to property and equipment amou nted to $ 10.1 million, $ 7.8 million and $ 6.5 million in fiscal years 2025 , 2024 and 2023 , respectively.
+Added: Total depreciation and amortization expense relating to property and equipment amounted to $ 12.1 million, $ 10.1 million and $ 7.8 million in fiscal years 2026 , 2025 and 2024 , respectively.
+Added: Of these amounts, $ 10.3 million, $ 8.2 million and $ 5.9 million was charged to cost of service revenue and cost of distribution sales in fiscal years 2026, 2025 and 2024, respectively.
+Added: The remaining depreciation and amortization expense was charged to Selling, Marketing and Warehouse Expenses and General and Administrative Expenses on the Company's Consolidated Statements of Income.
NOTE 3 – LONG-TERM DEBT
−Removed: On July 7, 2021, the Company entered into the Second Amended and Restated Credit Facility Agreement (the “Credit Agreement”) with Manufacturers and Traders Trust Company (“M&T”), that amended and restated in its entirety the Company’s prior credit agreement with M&T.
−Removed: The Credit Agreement provides for a revolving credit commitment (the “revolving credit facility”) of $ 80.0 million through June 2026, with a letter of credit subfacility of $ 10.0 million.
−Removed: The Company's 2018 term loan, with an original principal amount of $ 15.0 million (the "2018 Term Loan"), is also provided for under the Credit Agreement.
−Removed: The Credit Agreement allows the Company to use up to $ 50.0 million under the revolving credit facility for acquisitions in any single fiscal year.
−Removed: The Credit Agreement restricts the Company's ability to complete acquisitions of businesses with a principal place of business located in the United Kingdom or the European Union to an aggregate purchase price of $ 40.0 million during the term of the Credit Agreement, if the acquisition is financed directly or indirectly with the revolving credit facility.
−Removed: Under the Credit Agreement, the Company may make restricted payments up to $ 25.0 million in the aggregate over the term of the Credit Agreement and $ 10.0 million in any single fiscal year to repurchase shares and pay dividends.
−Removed: As of March 29, 2025 , $ 80.0 million was available for borrowing under the revolving credit facility, of which $ 30.9 million was out standing.
−Removed: During fiscal year 2025 , $ 87.4 million from cash on hand and the revolving credit facility was used for two business acquisitions.
−Removed: As of March 29, 2025 , $ 1.8 million was outstanding on the 2018 Term Loan, which was included in current liabilities on the Consolidated Balance Sheets.
−Removed: The 2018 Term Loan requires total repayments (principal plus interest) of $ 0.2 million per month through December 2025.
+Added: On July 29, 2025, the Company entered into a Credit Agreement (the “Credit Agreement”) with a group of three lenders establishing a new five -year $ 150.0 million secured revolving credit facility (the “Credit Facility”).
+Added: Borrowing options under the Credit Facility include:
+Added: (i) a revolving loan option;
+Added: (ii) a swingline loan option;
+Added: and (iii) letters of credit, each of which is provided on a committed basis.
+Added: The Credit Facility replaced the Company’s former $ 80.0 million credit facility (the “Replaced Facility”), which included a letter of credit subfacility of $ 10.0 million and the Company’s 2018 term loan, with an original principal amount of $ 15.0 million (the “2018 Term Loan”).
+Added: In connection with the Credit Agreement, the Company entered into a syndicated loan.
+Added: The lender of the Replaced Facility participated in the Credit Agreement.
+Added: For accounting purposes, the transaction was accounted for as a debt modification;
+Added: however, there were no remaining unamortized costs from the Replaced Facility.
+Added: The Company incurred financing costs that will be deferred and amortized on a straight-line basis over the term of the Credit Agreement.
+Added: These amounts are included in Other Assets in the Consolidated Balance Sheets.
+Added: On July 7, 2021, the Company entered into the Replaced Facility with Manufacturers and Traders Trust Company (“M&T”), that amended and restated in its entirety the Company’s prior credit agreement with M&T.
+Added: The Replaced Facility provided for a revolving credit commitment of $ 80.0 million through June 2026, with a letter of credit subfacility of $ 10.0 million.
+Added: The 2018 Term Loan was also provided for under the Replaced Facility.
+Added: The Credit Agreement allows the Company to use up to $ 50.0 million under the Credit Facility for acquisitions in any single fiscal year with an exception for the acquisition of Essco.
+Added: In addition, we are permitted to make restricted payments up to $ 25.0 million in the aggregate over the term of the Credit Facility and $ 10.0 million in any single fiscal year to repurchase shares and pay dividends.
+Added: As of March 28, 2026, $ 150.0 million was available for borrowing, subject to covenant restrictions, under the Credit Facility, of which $ 99.9 million was outstanding.
Interest and Other Costs:
−Removed: Effective July 1, 2023, interest on outstanding borrowings under the revolving credit facility accrue, at Transcat’s election, at either the variable Daily Simple SOFR or a fixed rate for a designated period at the SOFR corresponding to such period (subject to a 0.25 % floor), in each case, plus a margin.
−Removed: Unused fees accrue based on the average daily amount of unused credit available on the revolving credit facility.
+Added: Effective July 1, 2023, interest on outstanding borrowings under the revolving credit facility accrued, at Transcat’s election, at either the variable Daily Simple SOFR or a fixed rate for a designated period at the SOFR corresponding to such period (subject to a 1.00 % floor), in each case, plus a margin.
+Added: Unused fees accrued based on the average daily amount of unused credit available on the revolving credit facility.
Interest rate margins and unused fees are determined on a quarterly basis based upon the Company’s calculated leverage ratio.
−Removed: The Company’s interest rate for the revolving credit facility for fiscal year 2025 ranged from 5.1 % to 6.2 %.
−Removed: The Company's interest rate for the revolving credit facility at March 29, 2025 was 5.2 %.
−Removed: Interest on outstanding borrowings under the 2018 Term Loan accrue at a fixed rate of 3.90 % over the term of the loan.
−Removed: The Credit Agreement has certain covenants with which the Company must comply, including a fixed charge ratio covenant, which prohibits the Company's fixed charge ratio from being less than 1.15 to 1.00, and a leverage ratio covenant, which prohibits the Company's leverage ratio from exceeding 3.00 to 1.00.
−Removed: The Company was in compliance with all loan covenants and requirements during fiscal years 2025 and 2024 .
−Removed: The Company has pledged all of its U.S.
+Added: The Company’s weighted average interest rate for the revolving credit facility for fiscal year 2026 was 5.6 %.
+Added: The Credit Facility has certain covenants with which the Company is required to comply, including a fixed charge ratio covenant, which prohibits the Company's fixed charge ratio from being less than 1.20 to 1.00, and a leverage ratio covenant, which prohibits the Company's leverage ratio of outstanding indebtedness to consolidated EBITDA from exceeding 3.00 to 1.00.
+Added: The Company was in compliance with all financial covenants and requirements during fiscal years 2026 and 2025.
+Added: The Company 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.
−Removed: as collateral security for the loans made under the revolving credit facility.
+Added: and Cal Op Ex Limited as collateral security for the loans made under the Credit Facility.
NOTE 4 – INCOME TAXES
18 unchanged sentences
A reconciliation of the income tax provision computed by applying the statutory U.S.
−Removed: federal income tax rate and the income tax provision reflected in the Consolidated Statements of Income is as follows (amounts in thousands):
+Added: federal income tax rate and the income tax provision reflected in the Consolidated Statements of Income for fiscal year 2026 is as follows (amounts in thousands):
(Effective Tax Rate)
1 unchanged sentence
$ 1,678 21.0 %
−Removed: State Income Taxes, net of federal benefit
−Removed: 630 3.4 % 593 311
+Added: State Income Taxes, net of federal benefit^
Federal, State and Foreign Tax Credits
+Added: Foreign tax effects:
+Added: Deferred tax basis adjustment
( 232 ) (2.9) %
−Removed: Foreign Rate Differential
+Added: Other foreign jurisdictions
+Added: Effect of cross-border tax laws:
( 9 ) (0.1) %
+Added: Nontaxable or nondeductible items:
+Added: Restricted Stock award shortfall (windfall)
+Added: 162(m) Limitation
+Added: Other Adjustments, net
+Added: $ 2,613 32.7 %
+Added: The state and local jurisdictions that contribute the majority (greater than 50% ) of the tax effect in this category are Massachusetts, Minnesota, California, New York, Pennsylvania and Puerto Rico.
+Added: A reconciliation of the income tax provision computed by applying the statutory U.S.
+Added: federal income tax rate and the income tax provision reflected in the Consolidated Statements of Income for fiscal years 2025 and 2024 is as follows (amounts in thousands):
+Added: Federal Income Tax at Statutory Rate
+Added: $ 3,848 $ 3,872
+Added: State Income Taxes, net of federal benefit
+Added: Federal, State and Foreign Tax Credits
+Added: Foreign Rate Differential
Tax Impact of Equity Awards
1 unchanged sentence
162(m) Limitation
−Removed: 276 1.5 % 805 -
Non-Deductible Acquisition Costs
1 unchanged sentence
$ 3,811 $ 4,792
−Removed: 107 0.6 % 19 39
−Removed: $ 3,811 20.8 % $ 4,792 $ 2,799
Deferred Tax Assets:
2 unchanged sentences
Performance-Based Stock Award Grants
−Removed: Inventory Reserves
Net Operating losses
+Added: Inventory Reserves
Non-Qualified Deferred Compensation Plan
2 unchanged sentences
Capitalized Inventory Costs
−Removed: Capitalized Acquisition Costs
Total Deferred Tax Assets
6 unchanged sentences
( 10,011 ) ( 7,667 )
−Removed: ( 32 ) ( 63 )
Total Deferred Tax Liabilities
2 unchanged sentences
$ ( 10,167 ) $ ( 9,286 )
+Added: Income taxes paid (net of refunds) for the year ended March 28, 2026, are disaggregated by jurisdiction as follows (in thousands):
+Added: Other Foreign
+Added: Total Income Taxes Paid
The Company files income tax returns with the U.S.
10 unchanged sentences
and $ 0.7 million in Ireland, which could be used to offset future taxable income and reduce income tax expense.
−Removed: These NOL carryforwards will not expire.
+Added: These NOL carryforwards do not expire.
The Company’s policy regarding interest and/or penalties related to income tax matters is to recognize such items as a component of the income tax provision.
The Company recognized no interest expense or penalties associated with uncertain tax benefits accrued for fiscal years 2026 , 2025 and 2024 .
−Removed: In accordance with applicable accounting guidance, the amount of unrecognized tax liability from uncertain positions was $ 0 at year-end fiscal years 2025 , 2024 and 2023 .
+Added: In accordance with applicable accounting guidance, the amount of unrecognized tax liability from uncertain positions was $ 0 at year-end for fiscal years 2026 , 2025 and 2024 .
The Company assesses its deferred tax assets annually for expected utilization.
2 unchanged sentences
The Company has determined that a valuation allowance of $ 0 is appropriate for fiscal years 2026 , 2025 and 2024 .
+Added: On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted into law.
+Added: The legislation includes several changes to U.S.
+Added: federal income tax law that generally allow for more favorable deductibility of certain business expenses beginning in calendar year 2025, including the restoration of immediate expensing for domestic research and development expenditures and the reinstatement of 100% bonus depreciation for qualified property.
+Added: The OBBBA also includes certain modifications to the U.S.
+Added: taxation of foreign activity, including changes to rules governing foreign tax credits, Global Intangible Low-Taxed Income (“GILTI”), Foreign-Derived Intangible Income (“FDII”), and the Base Erosion and Anti-Abuse Tax (“BEAT”), among other changes.
+Added: Most of these modifications to the U.S.
+Added: taxation of foreign activity are generally effective for tax years beginning after December 31, 2025.
+Added: Certain benefits from the OBBBA, such as utilizing the restored 100% bonus depreciation rules for assets acquired after January 19, 2025, were included in the provision for income taxes for fiscal year 2026.
+Added: The impacts of the benefits of the OBBBA were not material to the provision for income taxes for fiscal year 2026.
NOTE 5 – EMPLOYEE BENEFIT PLANS
5 unchanged sentences
Plan participants are fully vested in their contributions while Company contributions are fully vested after three years of service.
−Removed: The Company’s matching contributions to the 401K P lan were approximately $ 1.8 million, $ 1.5 million and $ 1.2 million in fiscal years 2025 , 2024 and 2023 , respectively.
+Added: The Company’s matching contributions to the 401K Plan were approximately $ 2.1 million, $ 1.8 million and $ 1.5 million in fiscal years 2026 , 2025 and 2024 , respectively, and were recorded in general and administrative expenses in the accompanying Consolidated Statements of Income.
In the deferred profit sharing portion of the Plan, Company contributions are made at the discretion of the Company’s Board of Directors.
3 unchanged sentences
650,000 shares can be purchased under the ESPP.
−Removed: The difference between the closing market price on the Investment Date and the price paid by employees is recorded as a general and administrative expense in the accompanying Consolidated Statements of Income.
−Removed: The expense related to the ESPP was less th an $ 0.1 million i n each of fiscal years 2025 , 2024 and 2023 .
+Added: The difference between the closing market price on the Investment Date and the price paid by employees is recorded as a general and administrative expenses in the accompanying Consolidated Statements of Income.
+Added: The expense related to the ESPP was $ 0.1 million in fiscal year 2026 and less than $ 0.1 million in fiscal years 2025 and 2024 .
Non-Qualified Deferred Compensation Plan.
5 unchanged sentences
In the event of bankruptcy, the assets of the NQDC Plan are available to satisfy the claims of the Company’s general creditors.
−Removed: The liability for compensation deferred under the NQDC Plan was $ 0.1 million as of both March 29, 2025 and March 30, 2024 , and is i ncluded as a component of other liabilities (non-current) on the Consolidated Balance Sheets.
+Added: The liability for compensation deferred under the NQDC Plan was de minimis as of March 28, 2026 and $ 0.1 million as of March 29, 2025 , and is included as a component of other liabilities (non-current) on the Consolidated Balance Sheets.
Post Retirement Health Care Plans.
7 unchanged sentences
( 78 ) ( 102 ) ( 121 )
−Removed: Actuarial (gain)
+Added: Actuarial (gain) loss
171 ( 89 ) ( 85 )
12 unchanged sentences
Amortization of prior service cost
+Added: Total Net periodic post retirement benefit cost:
Benefit obligations recognized in other comprehensive income (loss):
2 unchanged sentences
Prior service cost
−Removed: Net actuarial gain
+Added: Net actuarial (gain)/loss
171 ( 89 ) ( 85 )
6 unchanged sentences
The prior service cost is amortized over the average remaining life expectancy of active participants in the Officer Plan.
−Removed: The estimated prior service cost that will be amortized from accumulated other comprehensive income into net periodic post-retirement benefit cost during fiscal year 2025 is les s than $ 0.1 million.
+Added: The estimated prior service cost that will be amortized from accumulated other comprehensive income into net periodic post-retirement benefit cost during fiscal year 2027 is less than $ 0.1 million.
The post retirement benefit obligation was computed by an independent third -party actuary.
10 unchanged sentences
The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid as follows (amounts in thousands):
−Removed: Increasing the assumed health care cost trend rate by one percentage point would increase the accumulated post-retirement benefit obligation and the annual net periodic pos t-retirement benefit cost by $ 0.1 million.
+Added: Increasing the assumed health care cost trend rate by one percentage point would increase the accumulated post retirement benefit obligation and the annual net periodic post retirement benefit cost by $ 0.1 million.
A one percentage point decrease in the healthcare cost trend would decrease the accumulated post retirement benefit obligation and the annual net periodic post-retirement benefit cost by $ 0.1 million.
2 unchanged sentences
2021 Stock Incentive Plan (the “2021 Plan”) was approved by shareholders and became effective.
−Removed: The 2021 Plan replaced the Transcat, Inc.
−Removed: 2003 Incentive Plan (the “2003 Plan”).
−Removed: Shares available for grant under the 2021 Plan include any shares remaining available for issuance under the 2003 Plan and any shares that are subject to outstanding awards under the 2003 Plan that are subsequently canceled, expired, forfeited, or otherwise not issued or are settled in cash.
The 2021 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 March 28, 2026 , 0.4 million shares of common stock were available for future grant under the 2021 Plan.
−Removed: The Company receives an excess tax benefit related to restricted stock v esting and stock options exercised and redeemed.
+Added: The Company receives an excess tax benefit related to restricted stock vesting and stock options exercised and redeemed.
The discrete benefits related to share-based compensation and stock option activity in fiscal years 2026 , 2025 and 2024 were $ 0.7 million, $ 1.3 million and $ 0.6 million, respectively.
3 unchanged sentences
The fair value of the restricted stock unit grants is the quoted market price for the Company’s common stock on the date of grant.
−Removed: These restricted stock units are either time vested, or vest following the third fiscal year from the date of grant subject to cumulative diluted earnings per share or cumulative Adjusted EBITDA targets over the eligible period.
+Added: These restricted stock units are either time vested, or vest following the third fiscal year from the date of grant subject to cumulative diluted earnings per share (ending with fiscal year 2025 ) or cumulative Adjusted EBITDA targets over the eligible period.
During fiscal year 2026, on the date of the annual meeting of shareholders, the Company’s non-employee directors received an annual grant of restricted stock units valued at $ 120,000 that vests after one year.
−Removed: During fiscal years 2024 and 2023, the Company's non-employee directors received an annual grant of restricted stock units valued at $ 50,000 that vested after one year.
+Added: During fiscal years 2025 and 2024, the Company's non-employee directors received an annual grant of restricted stock units valued at $ 85,000 and $ 50,000 , respectively, that vested after one year.
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.
1 unchanged sentence
The expense relating to the time vested restricted stock units is recognized on a straight-line basis less estimate for forfeitures over the requisite service period for the entire award.
−Removed: During fiscal year 2025 , 32,000 shares of time-vested restricted stock units were granted and 10,000 shares of performance-based restricted stock units were granted.
−Removed: During fiscal year 2024 , 38,000 shares of time-vested restricted stock units were granted and 10,000 shares of performance-based restricted stock units were granted.
−Removed: During fiscal year 2023 , 19,000 shares of time-vested restricted stock units were granted and 11,000 shares of performance-based restricted stock units were granted.
Performance-based restricted stock units can be earned up to a maximum of 150 % of shares awarded.
−Removed: The following table summarizes the restricted stock units vested and shares issued during fiscal years 2025 , 2024 and 2023 (amounts in thousands, except per unit data):
−Removed: April 2019 – March 2022
−Removed: 20 $ 23.50 82 % 16 May 2022
−Removed: 1 $ 59.33 Time Vested
−Removed: September 2021
−Removed: September 2021 – September 2022
−Removed: 7 $ 66.09 Time Vested
−Removed: 7 September 2022
−Removed: September 2022
−Removed: September 2022
−Removed: 1 $ 73.30 Time Vested
−Removed: 1 September 2022
−Removed: October 2018 – September 2022
−Removed: 1 $ 20.81 Time Vested
−Removed: 1 October 2022
−Removed: April 2020 - March 2023
−Removed: 2 $ 26.25 Time Vested 2 April 2023
−Removed: July 2020 - July 2023
−Removed: 26 $ 27.08 Time Vested
−Removed: September 2020
−Removed: September 2020 - July 2023
−Removed: 4 $ 28.54 Time Vested
−Removed: September 2020
−Removed: September 2020 - July 2023
−Removed: 5 $ 29.76 Time Vested
−Removed: September 2022
−Removed: September 2022 - September 2023
−Removed: 5 $ 73.80 Time Vested
−Removed: 5 September 2023
−Removed: September 2020
−Removed: September 2020 - September 2023
−Removed: 3 $ 29.76 Time Vested
−Removed: 3 September 2023
−Removed: October 2018 – September 2023
−Removed: 1 $ 20.81 Time Vested 1 October 2023
−Removed: June 2021 - March 2024
−Removed: 11 $ 53.17 Time Vested 11 March 2024
−Removed: June 2021 - March 2024
−Removed: 10 $ 53.17 136 % 14 May 2024
−Removed: January 2022 - March 2024
−Removed: 1 $ 90.92 136 % 1 May 2024
−Removed: May 2023 - April 2024
−Removed: 1 $ 89.70 Time Vested
−Removed: August 2023 - August 2024
−Removed: 6 $ 90.56 Time Vested 6 August 2024
−Removed: September 2023
−Removed: September 2023 - September 2024
−Removed: 4 $ 109.55 Time Vested
−Removed: 4 September 2024
−Removed: September 2021
−Removed: September 2021 - September 2024
−Removed: 4 $ 67.76 Time Vested
−Removed: 4 September 2024
−Removed: October 2018 - October 2024
−Removed: 1 $ 20.81 Time Vested 1 October 2024
−Removed: March 2022 - March 2025
−Removed: 1 $ 76.31 Time Vested 1 March 2025
−Removed: May 2022 - March 2025
−Removed: 9 $ 63.17 Time Vested 9 March 2025
−Removed: The following table summarizes the non-vested restricted stock units outstanding as of March 29, 2025 (amounts in thousands, except per unit data):
−Removed: Achievement at
−Removed: March 29, 2025
−Removed: October 2018 – September 2027
−Removed: 4 $ 20.81 Time Vested
−Removed: May 2022 - March 2025
−Removed: 9 $ 63.17 0% of target level
−Removed: August 2022 - August 2025
−Removed: 1 $ 78.04 Time Vested
−Removed: May 2023 – March 2026
−Removed: 8 $ 89.70 150% of target level
−Removed: May 2023 – March 2026
−Removed: 8 $ 89.70 Time Vested
−Removed: May 2023 – May 2026
−Removed: 11 $ 89.70 Time Vested
−Removed: April 2024 - April 2027
−Removed: 2 $ 107.13 Time Vested
−Removed: April 2024 - April 2027
−Removed: 1 $ 108.04 Time Vested
−Removed: May 2024 - May 2027
−Removed: 1 $ 119.45 Time Vested
−Removed: May 2024 - May 2027
−Removed: 1 $ 124.12 Time Vested
−Removed: May 2024 - March 2027
−Removed: 9 $ 124.12 100% of target level
−Removed: May 2024 - March 2027
−Removed: 10 $ 124.12 Time Vested
−Removed: July 2024 - July 2027
−Removed: 1 $ 116.91 Time Vested
−Removed: September 2024
−Removed: September 2024 - September 2025
−Removed: 6 $ 120.66 Time Vested
−Removed: September 2024
−Removed: September 2024 - September 2027
−Removed: 1 $ 123.33 100% of target level
−Removed: September 2024
−Removed: September 2024 - September 2027
−Removed: 1 $ 123.33 Time Vested
−Removed: December 2024
−Removed: December 2024 - December 2027
−Removed: 9 $ 103.44 Time Vested
−Removed: Total expense relating to restricted stock units, based on grant date fair va lue and the achievement criteria, was $ 2.4 million, $ 3.2 million and $ 2.0 million in fiscal years 2025 , 2024 and 2023 , respectively.
+Added: On January 6, 2026, the Compensation Committee (the "Committee") of the Board of Directors of the Company granted a special one -time equity award to certain members of the executive team under the 2021 Plan (the “Retention Awards”).
+Added: The Committee granted approximately 56,000 restricted stock units with a grant date fair value of approximately $ 3.4 million.
+Added: The Retention Awards will vest on January 6, 2028, subject to continued employment and except as otherwise described in the form of award agreement.
+Added: The following table summarizes the non-vested restricted stock units outstanding as of March 28, 2026 ( in thousands, except per unit data):
+Added: Outstanding as of March 29, 2025
+Added: 74,171 $ 101.63
+Added: 168,261 $ 75.47
+Added: 39,840 $ 92.24
+Added: Outstanding as of March 28, 2026
+Added: 201,715 $ 81.72
+Added: Total expense relating to restricted stock units, based on grant date fair value and the achievement criteria, was $ 6.8 million, $ 2.4 million and $ 3.2 million in fiscal years 2026 , 2025 and 2024 , respectively.
As of March 28, 2026 , unearned compensation, to be recognized over the grants’ respective service periods, totaled $ 12.0 million based on estimated achievement levels as of March 28, 2026.
4 unchanged sentences
Expense for stock options is recognized on a straight-lined basis over the requisite service period for each award.
−Removed: Options vest either immediately or over a period of up to five years using a straight-line basis and expire either five years or ten years from the date of grant.
−Removed: We calculate the fair value of the stock options granted using the Black-Scholes model.
+Added: Options vest over a period of up to five years either in annual tranches or cliff vesting and expire either five years or ten years from the date of grant.
The following weighted-average assumptions were used to value options granted during fiscal years 2026 , 2025 and 2024 :
6 unchanged sentences
0.00 % 0.00 % 0.00 %
−Removed: We calculate expected volatility for stock options by taking an average of historical volatility over the expected term.
+Added: The Company calculates expected volatility for stock options by taking an average of historical volatility over the expected term.
The computation of expected term was determined based on safe harbor rules, giving consideration to the contractual terms of the stock-based awards and vesting schedules.
2 unchanged sentences
We assume no expected dividends.
−Removed: Under FASB ASC Topic 718, “Compensation – Stock Compensation”, the Company has elected to account for forfeitures as they occur.
−Removed: During fiscal year 2025 , the Company granted options for 10,000 shares of common stock in the aggregate to Company employees that vest over three years.
−Removed: During fiscal year 2024 , the Company granted options for 7,000 shares of common stock in the aggregate to Company employees that vest over three years, an option for 10,000 shares of common stock to a Company employee that vests over five years and options for 30,000 shares of common stock ( 10,000 each) to three Company directors that vest over five years.
−Removed: During fiscal year 2023 , the Company granted options for 46,000 shares of common stock in the aggregate to Company employees that vest over three years and an option for 10,000 shares of common stock to a Company director that vests over five years .
The expense related to all stock option awards was $ 0.7 million, $ 0.8 million and $ 1.3 million in fiscal years 2026, 2025 and 2024, respectively.
−Removed: The following table summarizes the Company’s options for fiscal years 2025 , 2024 and 2023 (amounts in thousands, except per option data):
−Removed: Outstanding as of March 26, 2022
−Removed: Outstanding as of March 25, 2023
+Added: The following table summarizes the Company’s options for fiscal year 2026 (amounts in thousands, except per option data):
Outstanding as of March 29, 2025
3 unchanged sentences
113 $ 64.11 4 $ 1,293
−Removed: 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 fiscal year 2025 and the exercise price, multiplied by the number of in-the-money stock options) that would have been received by the option holde rs had all holders exercised their options on March 29, 2025 .
+Added: 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 fiscal year 2026 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 March 28, 2026 .
The amount of aggregate intrinsic value will change based on the fair market value of the Company’s common stock.
Total unrecognized compensation cost related to non-vested stock options as of March 28, 2026 was $ 0.7 million, which is expected to be recognized over a period of three years.
−Removed: The aggregate intrinsic value of stock options exercised in fiscal years 2025 , 2024 and 2023 was $ 3.2 million, $ 1.3 million and $ 0.3 million, respectively.
−Removed: Cash received from the exercise of options in fiscal years 2025 , 2024 and 2023 was $ 1.3 million, $ 1.5 million and $ 0.1 million, respectively.
+Added: The aggregate intrinsic value of stock options exercised in fiscal years 2026 , 2025 and 2024 was less than $ 0.1 million, $ 3.2 million and $ 1.3 million, respectively.
+Added: Cash received from the exercise of options in fiscal years 2026 , 2025 and 2024 was less than $ 0.1 million, $ 1.3 million and $ 1.5 million, respectively.
NOTE 7 – SEGMENT AND GEOGRAPHIC DATA
−Removed: Operating segments represent a component of the Company that engages in business activities from which it may recognize revenues and incur expenses whose operating results are regularly reviewed by the public entity’s chief operating decision maker (“CODM”) to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available.
−Removed: Once operating segments are identified, the Company determined which of those operating segments are required to be presented as reportable segments based on the quantitative thresholds.
+Added: An operating segment is a component of the Company that engages in business activities from which it may recognize revenues and incur expenses whose operating results are regularly reviewed by the public entity’s chief operating decision maker (“CODM”) to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available.
+Added: Once operating segments were identified, the Company determined which of those operating segments are required to be presented as reportable segments based on the quantitative thresholds.
Transcat has two reportable segments:
Service and Distribution.
−Removed: Through our Service segment, we offer calibration, repair, inspection, analytical qualifications, preventative maintenance, consulting and other related services.
−Removed: Through our Distribution segment, we sell and rent national and proprietary brand instruments to customers globally.
+Added: Through its Service segment, the Company offers calibration, repair, inspection, analytical qualifications, preventative maintenance, consulting and other related services.
+Added: Through its Distribution segment, the Company sells and rents national and proprietary brand instruments to customers globally.
There are no intersegment revenues.
−Removed: Our CODM is Lee Rudow, President & Chief Executive Officer.
−Removed: Both of our reportable segments are regularly reviewed by the CODM through monthly revenue, gross profit, operating income and consolidated financial forecast updates and through regular and monthly meetings with the executive leadership team.
−Removed: The primary financial measure used by the CODM for our reportable segments is Operating Income, as reported in our Consolidated Statements of Income and is most consistent with the measurement principles used in the consolidated financial statements.
−Removed: This is used by the CODM to make decisions on resource allocation, assess the performance of the business, and monitor budget versus actual results.
−Removed: Significant expenses reviewed by the CODM consist of cost of revenue and operating expenses, which individually are consistent in total with what is shown on the face of the consolidated statements of income.
−Removed: The CODM does not review assets in evaluating the results of our segments, and therefore, such information is not presented.
−Removed: $ 96,993 $ 181,428 $ 278,421
+Added: The Company's CODM is the President & Chief Executive Officer.
+Added: Both of the Company's reportable segments are regularly reviewed by the CODM through monthly revenue, operating income and consolidated financial forecast updates and through regular and monthly meetings with the executive leadership team.
+Added: The primary financial measures used by the CODM for the Company's reportable segments are revenue and operating income (loss).
+Added: These measures are used by the CODM to make decisions on resource allocation, assess the performance of the business, and monitor budget versus actual results.
+Added: Significant expenses that are regularly reviewed by the CODM include segment cost of revenue, segment selling, general and administrative expenses and various items affecting comparability, which are primarily related to the Company's acquisitive nature.
+Added: The primary drivers of segment cost of revenue include labor, product and facilities costs, and the primary drivers of segment selling, general and administrative expenses include payroll, benefit and incentive costs.
+Added: Items affecting comparability include depreciation, amortization, executive transition costs, transaction expenses and non-cash stock compensation.
+Added: The CODM does not review assets or other balance sheet information in evaluating the results of the Company's segments, and therefore, such information is not presented.
+Added: Year Ended March 28, 2026:
+Added: Less Significant Segment Expenses
Cost of Revenue
−Removed: 68,199 120,769 188,968
−Removed: 28,794 60,659 89,453
−Removed: Operating Expenses
−Removed: 26,101 45,478 71,579
+Added: Selling, Marketing & Warehouse Expenses
+Added: General and Administrative Expenses
Operating Income
−Removed: 2,693 15,181 17,874
+Added: Reconciliation of Segment Operating Income to Income Before Taxes
+Added: Interest Expense
+Added: Interest Income
+Added: Other Expense
+Added: Income Before Provision For Income Taxes
Capital Expenditures
−Removed: 5,189 8,008 13,197
Depreciation and Amortization
−Removed: 7,485 11,082 18,567
−Removed: $ 89,956 $ 169,525 $ 259,481
+Added: Year Ended March 29, 2025:
+Added: Less Significant Segment Expenses
Cost of Revenue
−Removed: 63,403 112,272 175,675
−Removed: 26,553 57,253 83,806
−Removed: Operating Expenses
−Removed: 21,815 42,210 64,025
+Added: Selling, Marketing & Warehouse Expenses
+Added: General and Administrative Expenses
Operating Income
−Removed: 4,738 15,043 19,781
+Added: Reconciliation of Segment Operating Income to Income Before Taxes
+Added: Interest Expense
+Added: Interest Income
+Added: Income Before Provision For Income Taxes
Capital Expenditures
−Removed: 7,139 6,141 13,280
Depreciation and Amortization
−Removed: 4,284 9,193 13,477
−Removed: $ 85,686 $ 144,883 $ 230,569
+Added: Year Ended March 30, 2024:
+Added: Less Significant Segment Expenses
Cost of Revenue
−Removed: 63,969 98,245 162,214
−Removed: 21,717 46,638 68,355
−Removed: Operating Expenses
−Removed: 16,891 35,216 52,107
+Added: Selling, Marketing & Warehouse Expenses
+Added: General and Administrative Expenses
Operating Income
−Removed: 4,826 11,422 16,248
+Added: Reconciliation of Segment Operating Income to Income Before Taxes
+Added: Interest Expense
+Added: Interest Income
+Added: Other Expense
+Added: Income Before Provision For Income Taxes
Capital Expenditures
−Removed: 3,845 5,569 9,414
Depreciation and Amortization
−Removed: 2,155 8,800 10,955
The following table presents geographic data for fiscal years 2026 , 2025 and 2024 (dollars in thousands):
15 unchanged sentences
United States includes Puerto Rico.
−Removed: NOTE 8 – COMMITMENTS
+Added: NOTE 8 – COMMITMENTS AND CONTINGENCIES
The Company determines if an arrangement is a lease at inception.
9 unchanged sentences
There is no transfer of title or option to purchase the leased assets upon expiration.
−Removed: The weighted average discount rate for fiscal years 2025 , 2024 and 2023 was 4.4 %, 4.1 % and 3.9 %, re spectively.
−Removed: The weighted average remaining lease term is approximately eleven years.
−Removed: Short-term leases are leases having a term of 12 months or less.
The Company recognizes short-term leases on an as incurred basis and does not record a related lease asset or liability for such leases.
3 unchanged sentences
$ 6,021 $ 6,606 $ 5,948
+Added: Amortization of Finance Right to Use Assets
+Added: Interest on Finance Right to Use Assets
+Added: Short Term Lease Expense
Variable lease cost
+Added: 1,392 691 666
Total lease cost
4 unchanged sentences
$ 5,842 $ 2,018 $ 2,954
−Removed: Right to Use Assets obtained in exchange for lease liabilities
+Added: Operating cash flow from financing leases
+Added: Financing cash flows from financing leases
$ 280 $ - $ -
−Removed: Total rental expense was approximately $ 7.3 million, $ 6.6 million and $ 5.3 million in fiscal years 2025 , 2024 and 2023 , respectively.
+Added: Right to Use Assets obtained in exchange for lease liabilities -operating
+Added: $ 12,131 $ 9,723 $ 4,965
+Added: Right to Use Assets obtained in exchange for lease liabilities - financing
The minimum future annual rental payments under the non-cancelable leases at March 28, 2026 are as follows (in millions):
2 unchanged sentences
Present value of remaining lease payments
−Removed: Contingent Consideration:
−Removed: In connection with the acquisition of NEXA, there were potential earn-out payments of up to $ 7.5 million over the four -year period following the closing of the transaction based upon NEXA achieving certain annual revenue and EBITDA goals.
−Removed: During fiscal year 2024, the Company entered into an Amendment to the Share Purchase Agreement with NEXA (the “First Amendment”).
−Removed: Pursuant to the First Amendment, the potential earn-out payments would have been up to $ 7.1 million for the Earn-Out years of calendar year 2023, 2024 and 2025 based upon NEXA achieving certain EBITDA goals.
−Removed: If achieved, the earn-out payments would be made in shares of common stock unless certain criteria is met for cash payment.
−Removed: Subsequent to fiscal year 2024, the Company entered into an Amendment to the Share Purchase Agreement with NEXA (the “Second Amendment”).
−Removed: Pursuant to the Second Amendment, the Company agreed to pay approximately $ 0.5 million for the Earn-Out year of calendar year 2023 and removed the entitlement for any future earn-out payments.
−Removed: As of March 30, 2024, the estimated fair value of the 2023 earn-out payment was approximately $ 0.5 million.
−Removed: This payment was made during fiscal year 2025.
−Removed: As of March 29, 2025 and March 30, 2024, the estimated fair value of the 2024 and 2025 earn-out payments was zero.
+Added: The weighted average remaining lease term and weighted average discount rate for operating and finance leases are as follows:
+Added: Weighted Average Lease Term - Finance Leases
+Added: Weighted Average Lease Term - Operating Leases
+Added: Weighted Average Discount Rate - Finance Leases
+Added: Weighted Average Discount Rate - Operating Leases
+Added: 5.7 % 4.4 % 4.1 %
+Added: Contingencies:
+Added: In the normal course of business, the Company may have pending claims and legal proceedings.
+Added: The Company maintains accrued expense balances for the estimated amounts of legal costs expected to be billed related to any significant matter.
+Added: In the opinion of management, based on information available at this time, there are no current claims and proceedings that would have a material adverse effect on the consolidated financial statements.
+Added: However, the outcomes of such legal claims and proceedings are subject to inherent uncertainties.
NOTE 9 – BUSINESS ACQUISITIONS
−Removed: Effective December 10, 2024, the Company acquired all of the membership units of Martin Calibration, Inc, a privately-held Minnesota calibration services company ("Martin").
+Added: Effective August 5, 2025, the Company acquired 100 % of the membership units of Essco Calibration Laboratory, LLC (“Essco”), a privately-held calibration services corporation located in the Boston Metro area that is ISO 17025 certified.
+Added: This transaction aligned with a key component of the Company’s acquisition strategy of targeting businesses that expand the Company’s geographic reach and the depth and breadth of the Company’s service capabilities.
+Added: The Essco goodwill is primarily attributable to the workforce acquired, as well as operational synergies and other intangibles that do not qualify for separate recognition.
+Added: The goodwill and intangible assets related to the Essco acquisition have been allocated to the Service segment.
+Added: Intangible assets related to the Essco acquisition are being amortized for financial reporting purposes on an accelerated basis over the estimated useful lives of up to 15 years and are deductible for tax purposes.
+Added: Amortization of goodwill related to the Essco acquisition is deductible for income tax purposes.
+Added: The Essco Customer Base & Contracts intangible asset was calculated using the MPEEM (Multi-Period Excess Earnings Method) under the Income approach and adjusting for the cash flow benefit of tax amortization of purchased intangibles.
+Added: The fair value was determined to be $ 34.0 million and was assigned a useful life of 15 years.
+Added: The Essco Trademarks and Tradenames intangible asset was calculated using the Relief-From-Royalty Method, which is a variant of the income approach and the market approach, and adjusting for the cash flow benefit of tax amortization of purchased intangibles.
+Added: The fair value was determined to be $ 2.7 million and was assigned a useful life of seven years.
+Added: The weighted average useful life of acquired intangible assets acquired is 14 years.
+Added: The total purchase price for Essco is approximately $ 85.4 million, consisting of $ 82.8 million in cash paid at closing and $ 2.8 million in accrued liabilities related to certain post-closing adjustments and payments less $ 0.2 million working capital receivable.
+Added: There was a measurement period adjustment in December 2025 related to working capital that resulted in a $ 0.2 million decrease in goodwill.
+Added: Subsequent to March 28, 2026, the working capital settlement was received.
+Added: As of March 28, 2026, $ 2.8 million remains unpaid and is reflected in accrued compensation and other current liabilities in the Consolidated Balance Sheets.
+Added: The purchase was primarily financed by a draw on the Credit Agreement.
+Added: See Note 3 - Long-Term Debt for more details.
+Added: The Company has preliminarily estimated fair values for the assets purchased and liabilities assumed as of the date of the acquisition.
+Added: The amounts reported are considered preliminary as the Company is completing the valuations required to allocate the purchase price.
+Added: The following is a summary of the preliminary purchase price allocation, in the aggregate, to the fair value of Essco's assets and liabilities acquired on August 5, 2025 ( in thousands):
+Added: Intangible Asset – Customer Base & Contracts
+Added: Intangible Asset – Trademarks and Tradenames
+Added: Cash and Cash Equivalents
+Added: Accounts Receivable, net
+Added: Property and Equipment, net
+Added: Right To Use Assets
+Added: Prepaid Expenses and Other Current Assets
+Added: Current Liabilities
+Added: Lease Liabilities
+Added: Total Purchase Price
+Added: Since the acquisition, Essco has contributed revenue of $ 14.9 million and operating income of $ 0.2 million, which includes the negative impact of amortization of the acquired intangible assets.
+Added: Effective December 10, 2024, the Company acquired a 100 % membership interest in Martin Calibration, LLC, a Delaware limited liability calibration services company ("Martin").
Martin is ISO 17025 certified.
4 unchanged sentences
Amortization of goodwill related to the Martin acquisition is deductible for income tax purposes.
−Removed: The total purchase price for Martin was approximately $ 81.8 million consisting of $ 71.9 million in cash and the issuance of our common stock valued at $ 9.9 million, including $ 2.0 million in cash placed in escrow for certain post-closing adjustments and indemnification claims, if any.
−Removed: As of March 29, 2025, $ 2.2 million remains unpaid and is reflected in current liabilities in the Consolidated Balance Sheets.
−Removed: The purchase price allocation is subject to revision based upon our final review of tangible and intangible asset valuation assumptions, working capital adjustments, assets acquired, liabilities assumed and consideration transferred.
−Removed: The following is a summary of the preliminary purchase price allocation, in the aggregate, to the fair value, based on Level 3 inputs, of Martin's assets and liabilities acquired on December 10, 2024 ( in thousands):
+Added: The Martin Customer Base & Contracts intangible was calculated using the MPEEM (Multi-Period Excess Earnings Method) approach and adjusting for the cash flow benefit of tax amortization of purchased intangibles.
+Added: The fair value was determined to be $ 32.0 million and was assigned a useful life of 14 years.
+Added: The Martin Trademarks and Tradenames asset was calculated using the relief from royalty approach, which is a variant of the income approach, and adjusting for the cash flow benefit of tax amortization of purchased intangibles.
+Added: The fair value was determined to be $ 3.2 million and was assigned a useful life of 11 years.
+Added: The weighted average useful life of acquired intangible assets acquired is 14 years.
+Added: The total purchase price for Martin was $ 81.7 million, consisting of $ 71.9 million in cash and the issuance of common stock valued at $ 9.9 million, including $ 2.0 million placed in escrow for certain post-closing adjustments and claims against the sellers, if any.
+Added: There was a measurement period adjustment related to working capital that resulted in a $ 0.1 million decrease in goodwill.
+Added: The $ 2.0 million escrow was released to the sellers in December 2025.
+Added: The following is a summary of the final purchase price allocation, in the aggregate, to the fair value of Martin's assets and liabilities acquired on December 10, 2024 ( in thousands):
Intangible Assets – Customer Base & Contracts
Intangible Assets – Trademarks and Tradenames
−Removed: Accounts Receivable
−Removed: Property and Equipment
+Added: Cash and Cash Equivalents
+Added: Accounts Receivable, net
+Added: Property and Equipment, net
Right To Use Assets
−Removed: Other Current Assets
+Added: Prepaid Expenses and Other Current Assets
Current Liabilities
1 unchanged sentence
Total Purchase Price
−Removed: From the date of acquisition through the end of fiscal year 2025, Martin has contributed revenue of $ 8.8 million and an operating income of $ 0.5 million, which includes the negative impact of amortization of the acquired intangible assets.
−Removed: Effective April 15, 2024, the Company acquired Becnel, pursuant to an Agreement and Plan of Merger (the “Becnel agreement”), by and among the Company, Becnel and the other parties thereto.
+Added: Effective April 15, 2024, the Company acquired Becnel Rental Tools, LLC, a Louisiana limited liability company ("Becnel"), pursuant to an Agreement and Plan of Merger (the “Becnel agreement”), by and among the Company, Becnel and the other parties thereto.
Becnel is an ISO 9001:2015 certified provider of rental tools and services primarily utilized in the decommissioning and maintenance of oil wells.
4 unchanged sentences
Amortization of goodwill related to the Becnel acquisition is deductible for income tax purposes.
−Removed: The total purchase price for Becnel was approximately $ 49.8 million consisting of up to $ 17.5 million in cash and the issuance of our common stock valued at $ 32.3 million.
+Added: The Becnel Customer Base & Contracts intangible was calculated using the MPEEM approach and adjusting for the cash flow benefit of tax amortization of purchased intangibles.
+Added: The fair value was determined to be $ 7.2 million and was assigned a useful life of 10 years.
+Added: The Becnel Trademarks and Tradenames asset was calculated using the relief from royalty approach, which is a variant of the income approach and adjusting for the cash flow benefit of tax amortization of purchased intangibles.
+Added: The fair value was determined to be $ 0.8 million and was assigned a useful life of 11 years.
+Added: The weighted average useful life of acquired intangible assets acquired is 10 years.
+Added: The total purchase price for Becnel was $ 49.8 million consisting of up to $ 17.5 million in cash and the issuance of our common stock valued at $ 32.3 million.
Pursuant to the Becnel agreement, the Company held back approximately $ 2.5 million of the purchase price for certain potential post-closing adjustments.
−Removed: This includes $ 0.5 million withheld for ordinary post-closing adjustments and $ 2.0 million withheld that is subject to revenue target achievement.
−Removed: Pursuant to the Becnel agreement, the purchase price is subject to reduction by $ 2.0 million if certain revenue targets are not met through April 15, 2026.
−Removed: As of April 15, 2024 and December 28, 2024, the estimated fair value of this contingent consideration, classified as Level 3 in the fair value hierarchy, was approximately $ 1.5 million and $ 1.6 million, respectively.
−Removed: This amount was calculated using a Geometric Brownian motion distribution that was then used in a Monte Carlo simulation model.
−Removed: Assumptions used in the Monte Carlo simulation model included:
−Removed: 1 ) discount rate of 11.00 %, 2 ) risk-free interest rate of 5.00 %, 3 ) asset volatility of 30.00 %, and 4 ) forecasted revenue.
−Removed: 50 % of this contingent consideration is payable in cash and 50 % of this contingent consideration is payable in 9,283 shares of Transcat common stock.
−Removed: The cash portion of the contingent consideration is classified as a liability and is recorded in other liabilities in the Consolidated Balance Sheets.
−Removed: The stock portion of the contingent consideration is classified as equity and is recorded in shareholders equity in the Consolidated Balance Sheets.
−Removed: The contingent consideration payout will either be $ 0 or $ 2.0 million depending on the revenue target achievement.
−Removed: This cash portion of the contingent consideration is remeasured quarterly.
−Removed: If, as a result of remeasurement, the value of the cash portion of the contingent consideration changes, any charges or income will be included in the Company’s Consolidated Statements of Income.
−Removed: After reviewing the fiscal year 2026 forecast, the Company revalued the contingent consideration payout during the fourth quarter of fiscal year 2025.
−Removed: As of March 29, 2025, the estimated fair value of the contingent consideration, classified as Level 3 in the fair value hierarchy, was zero.
−Removed: This amount was calculated using a Geometric Brownian motion distribution that was then used in a Monte Carlo simulation model.
−Removed: Assumptions used in the Monte Carlo simulation model included:
−Removed: 1 ) discount rate of 14.50 %, 2 ) risk-free interest rate of 4.01 %, 3 ) asset volatility of 30.00 %, and 4 ) forecasted revenue.
−Removed: The Company recognized a non-cash gain of approximately $ 0.8 million, which was recorded in general and administrative expenses in its Consolidated Statement of Income for the quarter ended March 29, 2025.
−Removed: Due to the uncertainty with utilizing these significant unobservable inputs for this Level 3 fair value measurement, materially higher or lower fair value measurements may be recognized at subsequent remeasurement periods.
−Removed: The following is a summary of the purchase price allocation, in the aggregate, to the fair value, based on Level 3 inputs, of Becnel's assets and liabilities acquired on April 15, 2024 (in thousands):
+Added: This included $ 0.5 million withheld for ordinary post-closing adjustments and $ 2.0 million withheld that was subject to revenue target achievement.
+Added: The $ 0.5 million holdback was paid to the sellers in April 2025.
+Added: Pursuant to the Becnel agreement, the purchase price was subject to reduction by $ 2.0 million if certain revenue targets were not met through April 15, 2026.
+Added: As of April 15, 2024, the estimated fair value of this contingent consideration, classified as Level 3 in the fair value hierarchy, was approximately $ 1.5 million.
+Added: 50 % of this contingent consideration was payable in cash and 50 % of this contingent consideration was payable in 9,283 shares of Transcat common stock.
+Added: The cash portion of the contingent consideration was initially classified as a liability and recorded in other liabilities in the Consolidated Balance Sheets.
+Added: The stock portion of the contingent consideration was classified as equity and recorded in shareholders equity in the Consolidated Balance Sheets.
+Added: The cash portion of the contingent consideration was remeasured quarterly.
+Added: After reviewing the fiscal year 2026 forecast, the Company revalued the contingent consideration payout during the fourth quarter of fiscal year 2025 and recognized a non-cash gain of approximately $ 0.8 million, which left a contingent liability of zero as of March 29, 2025.
+Added: The gain was recorded in general and administrative expenses in its Consolidated Statement of Income.
+Added: As of March 28, 2026, the estimated fair value of the contingent consideration, classified as Level 3 in the fair value hierarchy, remained zero.
+Added: Subsequent to year end, on April 15, 2026, the adjustment period expired and revenue targets were not met.
+Added: The following is a summary of the final purchase price allocation of Becnel's assets and liabilities acquired on April 15, 2024 (in thousands):
Intangible Assets – Customer Base & Contracts
Intangible Assets – Trademarks and Tradenames
−Removed: Accounts Receivable
−Removed: Property and Equipment
−Removed: Other Current Assets
−Removed: Current Liabilities
−Removed: Total Purchase Price
−Removed: From the date of acquisition through the end of fiscal year 2025, Becnel has contributed revenue of $ 9.0 million and an operating loss of $ 1.0 million, which includes the negative impact of amortization of the acquired intangible assets.
−Removed: Effective August 8, 2023, Transcat purchased all of the outstanding capital stock of Axiom Test Equipment, Inc.
−Removed: (“Axiom”), a privately-held California rental provider of electronic test equipment to customers across the United States.
−Removed: This transaction aligned with a key component of the Company’s acquisition strategy of targeting businesses that expand the depth and breadth of the Company’s Distribution capabilities.
−Removed: The Axiom goodwill is primarily attributable to the workforce acquired, as well as operational synergies and other intangibles that do not qualify for separate recognition.
−Removed: All the goodwill and intangible assets relating to the Axiom acquisition has been allocated to the Distribution segment.
−Removed: Intangible assets related to the Axiom acquisition are being amortized for financial reporting purposes on an accelerated basis over the estimated useful life of up to twelve years and are not deductible for tax purposes.
−Removed: Amortization of goodwill related to the Axiom acquisition is not deductible for tax purposes.
−Removed: The total purchase price for Axiom was approximately $ 38.7 million and was paid with $ 10.0 million in cash and the issuance of our common stock valued at $ 28.6 million.
−Removed: Pursuant to the asset purchase agreement, the Company held back approximately $ 3.9 million of the purchase price for certain potential post-closing adjustments.
−Removed: During fiscal year 2025, $ 2.3 million was paid to settle a holdback for Axiom.
−Removed: At March 29, 2025, $ 1.6 million remains as a holdback and is reflected in other liabilities on the Consolidated Balance Sheets.
−Removed: The following is a summary of the purchase price allocation, in the aggregate, to the fair value, based on Level 3 inputs, of Axiom's assets and liabilities acquired on August 8, 2023 ( in thousands):
−Removed: Intangible Assets – Customer Base & Contracts
−Removed: Accounts Receivable
−Removed: Other Current Assets
−Removed: Property and Equipment
−Removed: Current Liabilities
−Removed: Deferred Tax Liability
−Removed: Total Purchase Price
−Removed: During fiscal year 2025, Axiom contributed revenue of $ 8.6 million and operating income of $ 0.2 million, which includes the negative impact of amortization of the acquired intangible assets.
−Removed: Effective July 12, 2023, Transcat purchased all of the outstanding capital stock of SteriQual, Inc.
−Removed: (“SteriQual”), a Florida based provider of expert consulting services to pharmaceutical, biopharmaceutical, medical device and diagnostic equipment manufacturers.
−Removed: This transaction aligned with a key component of the Company’s acquisition strategy of targeting businesses that expand the depth and breadth of the Company’s Service capabilities.
−Removed: The SteriQual goodwill is primarily attributable to the workforce acquired, as well as operational synergies and other intangibles that do not qualify for separate recognition.
−Removed: All the goodwill and intangible assets relating to the SteriQual acquisition has been allocated to the Service segment.
−Removed: Intangible assets related to the SteriQual acquisition are being amortized for financial reporting purposes on an accelerated basis over the estimated useful life of up to fifteen years and are not deductible for tax purposes.
−Removed: Amortization of goodwill related to the SteriQual acquisition is not deductible for tax purposes.
−Removed: The total purchase price for SteriQual was approximately $ 4.3 million and was paid by the issuance of our common stock.
−Removed: Pursuant to the asset purchase agreement, the Company held back approximately $ 0.9 million of the purchase price for certain potential post-closing adjustments.
−Removed: Pursuant to the asset purchase agreement, the purchase price is subject to reduction by $ 0.5 million if certain revenue targets are not met through July 12, 2024.
−Removed: The purchase price was reduced to $ 3.8 million as of December 23, 2023 as the Company recorded a receivable in the amount of $ 0.5 million related to the revenue target contingent consideration.
−Removed: This receivable was recognized based on the facts and circumstances at the date of acquisition and is recognized as a component of goodwill and not recorded in the Consolidated Statement of Income.
−Removed: The revenue targets were not met and the remaining $ 0.4 million of the holdback was paid during the second quarter of fiscal year 2025.
−Removed: The following is a summary of the purchase price allocation, in the aggregate, to the fair value, based on Level 3 inputs, of SteriQual's assets and liabilities acquired on July 12, 2023 ( in thousands):
−Removed: Intangible Assets – Customer Base & Contracts
−Removed: Intangible Assets – Covenant Not to Compete
−Removed: Intangible Assets – Sales Backlog
−Removed: Accounts Receivable
−Removed: Current Liabilities
−Removed: Deferred Tax Liability
−Removed: Total Purchase Price
−Removed: During fiscal year 2025, SteriQual contributed revenue of $ 2.2 million and an operating loss of $ 0.2 million, which includes the negative impact of amortization of the acquired intangible assets.
−Removed: Effective March 27, 2023, Transcat purchased all of the outstanding capital stock of TIC-MS, Inc.
−Removed: (“TIC-MS”), a Missouri based provider of calibration services.
−Removed: This transaction aligned with a key component of the Company’s acquisition strategy of targeting businesses that expand the depth and breadth of the Company’s Service capabilities.
−Removed: The TIC-MS goodwill is primarily attributable to the workforce acquired, as well as operational synergies and other intangibles that do not qualify for separate recognition.
−Removed: All the goodwill and intangible assets relating to the TIC-MS acquisition has been allocated to the Service segment.
−Removed: Intangible assets related to the TIC-MS acquisition are being amortized for financial reporting purposes on an accelerated basis over the estimated useful life of up to fifteen years and are not deductible for tax purposes.
−Removed: Amortization of goodwill related to the TIC-MS acquisition is not deductible for tax purposes.
−Removed: The total purchase price for TIC-MS was approximately $ 9.7 million and was paid with $ 2.9 million in cash, including $0.
−Removed: 5 million placed in escrow for contingent consideration, certain post-closing adjustments and indemnification claims, if any, and the issuance of 77,387 shares of our common stock valued at $ 6.9 million.
−Removed: Pursuant to the asset purchase agreement, the purchase price was subject to reduction by up to $ 0.5 million if a key customer relationship was not retained through March 27, 2024.
−Removed: As of March 30, 2024, we continued to retain this key customer relationship.
−Removed: As a result, there was no receiv able recognized relating to the $ 0.5 million contingent consideration.
−Removed: The following is a summary of the purchase price allocation, in the aggregate, to the fair value, based on Level 3 inputs, of TIC-MS's assets and liabilities acquired on March 27, 2023 ( in thousands):
−Removed: Intangible Assets – Customer Base & Contracts
−Removed: Intangible Assets – Covenant Not to Compete
−Removed: Accounts Receivable
−Removed: Property and Equipment
+Added: Cash and Cash Equivalents
+Added: Accounts Receivable, net
+Added: Property and Equipment, net
+Added: Prepaid Expenses and Other Current Assets
Current Liabilities
−Removed: Deferred Tax Liability
Total Purchase Price
−Removed: During fiscal year 2025, TIC-MS contributed revenue of $ 3.2 million and operating income of $ 1.5 million, which includes the negative impact of amortization of the acquired intangible assets.
−Removed: Effective August 31, 2021, Transcat purchased all of the outstanding capital stock of Cal OpEx Limited (d/b/a NEXA Enterprise Asset Management), an Irish company, which owns all of the issued and outstanding capital stock of its U.S.-based subsidiary, Cal OpEx Inc., a Delaware corporation (collectively, “NEXA”).
−Removed: On September 11, 2023, the Company entered into the first amendment (the “First Amendment”) to a Share Purchase Agreement dated August 31, 2021 ( the “Purchase Agreement”) with John Cummins and Ross Lane (the “Sellers”) associated with the Company’s purchase of all of the outstanding capital stock of NEXA.
−Removed: As described below, the First Amendment changed the conditions necessary for the Sellers to receive potential earn-out payments, changes the lines of business included in the calculation of earnings before income taxes, depreciation and amortization (“EBITDA”), and changes the outside due date of any potential earn-out payments.
−Removed: On May 20, 2024, the Company entered into the second amendment to the Purchase Agreement (the “Second Amendment”).
−Removed: As described below, the Second Amendment removed the entitlement for future earn-out payments.
−Removed: Pursuant to the Purchase Agreement, the Sellers were entitled to potential earn-out payments in an aggregate amount of up to $ 7.5 million for the calendar years ending December 31, 2022, 2023, 2024, and 2025 (each, an “Earn-Out Year”) if NEXA’s consolidated gross revenue, as defined in the Purchase Agreement, equaled or exceeded 70% of the target revenue specified in the Purchase Agreement and NEXA’s consolidated EBITDA percentage, as defined in the Purchase Agreement, equaled or exceeded 25% for a given earn-out year.
−Removed: The potential earn-out payment of up to $ 0.4 million for the 2022 Earn-Out Year was not earned under the Purchase Agreement.
−Removed: Pursuant to the First Amendment, the Sellers were entitled to potential earn-out payments in an aggregate amount of up to $ 7.1 million for the remaining Earn-Out Years ( 2023, 2024 and 2025 ) if NEXA’s consolidated EBITDA, as defined in the Amendment, equaled or exceeded 70% of the target EBITDA specified in the Amendment for a given earn-out year.
−Removed: Pursuant to the First Amendment, the definition of EBITDA was revised to include EBITDA from the Commissioning, Qualification and Validation business ("CQV") and incremental EBITDA from the SteriQual, Inc.
−Removed: The maximum earn-out payment would have been received if NEXA’s consolidated EBITDA equaled or exceeded 150% of the target EBITDA specified in the First Amendment.
−Removed: The earn-out payments, if any, would be paid in shares of common stock, calculated using the volume-weighted average closing price of the common stock for 30 consecutive trading days ending on the trading day that is two days prior to the date the earn-out payment is to be paid (“VWAP”).
−Removed: If the VWAP is less than $ 45.07 per share, then the Company may pay the earn-out payment in cash in lieu of shares of common stock.
−Removed: As of March 25, 2023, the estimated fair value for the total earn-out obligations under the original Purchase Agreement, classified as Level 3 in the fair value hierarchy, was zero.
−Removed: After entering into the First Amendment during the third quarter of fiscal year 2024, the Company revalued the earn-out obligations.
−Removed: As of September 23, 2023, the estimated fair value for the total earn-out obligations under the First Amendment, classified as Level 3 in the fair value hierarchy, was approximately $ 2.8 million.
−Removed: This amount was calculated using a Geometric Brownian motion distribution that was then used in a Monte Carlo simulation model.
−Removed: Assumptions used in the Monte Carlo simulation model included:
−Removed: 1 ) discount rate of 9.00 %, 2 ) risk-free interest rate of 5.00 %, 3 ) asset volatility of 25.00 %, and 4 ) forecasted revenue and EBITDA.
−Removed: The Company recognized a non-cash expense of $ 2.8 million, which was recorded in general and administrative expenses in its Consolidated Statement of Income for the quarter ended September 23, 2023.
−Removed: As of December 23, 2023, the estimated fair value of the total earn-out obligations under the First Amendment was approximately $ 2.9 million.
−Removed: The change in accrual is due to the actual results of the 2023 calendar Earn-Out Year and the accretion of the 2024 and 2025 Earn-Out Years.
−Removed: As a result, the Company recognized a non-cash expense of $ 0.1 million, which was recorded in general and administrative expenses in its Consolidated Statement of Income for the quarter ended December 23, 2023.
−Removed: After reviewing the fiscal year 2025 budget and revised revenue and EBITDA forecasts for the remainder of calendar 2025, during the fourth quarter of fiscal year 2024, the Company revalued the earn-out obligations.
−Removed: As of March 30, 2024, the estimated fair value for the total earn-out obligations under the First Amendment, classified as Level 3 in the fair value hierarchy, was zero.
−Removed: This amount was calculated using a Geometric Brownian motion distribution that was then used in a Monte Carlo simulation model.
−Removed: Assumptions used in the Monte Carlo simulation model included:
−Removed: 1 ) discount rate of 12.00 %, 2 ) risk-free interest rate of 4.70 %, 3 ) asset volatility of 22.50 %, and 4 ) forecasted revenue and EBITDA.
−Removed: The Company recognized a non-cash gain of approximately $ 2.4 million, which was recorded in general and administrative expenses in its Consolidated Statement of Income for the quarter ended March 30, 2024.
−Removed: As of March 30, 2024, the 2023 calendar Earn-Out Year was $ 0.5 million.
−Removed: This was paid during the first quarter of fiscal year 2025.
−Removed: Pursuant to the Second Amendment, the Company agreed to pay approximately $ 0.5 million for the 2023 Earn-Out Year and removed the entitlement for any future earn-out payments.
+Added: In connection with the acquisition of NEXA, there were potential earn-out payments of up to $ 7.5 million over the four -year period following the closing of the transaction based upon NEXA achieving certain annual revenue and EBITDA goals.
+Added: During fiscal year 2024, the Company entered into an Amendment to the Share Purchase Agreement with NEXA (the “First Amendment”).
+Added: Pursuant to the First Amendment, the potential earn-out payments would have been up to $ 7.1 million for the Earn-Out years of calendar year 2023, 2024 and 2025 based upon NEXA achieving certain EBITDA goals.
+Added: If achieved, the earn-out payments would be made in shares of common stock unless certain criteria was met for cash payment.
+Added: In fiscal year 2025, the Company entered into an Amendment to the Share Purchase Agreement with NEXA (the “Second Amendment”).
+Added: Pursuant to the Second Amendment, the Company agreed to pay approximately $ 0.5 million for the Earn-Out year of calendar year 2023 and removed the entitlement for any future earn-out payments.
+Added: This payment was made during fiscal year 2025.
The results of acquired businesses are included in Transcat’s consolidated operating results as of the dates the businesses were acquired.
−Removed: The following unaudited pro forma information presents the Company’s results of operations as if the acquisitions of Martin, Becnel, Axiom, SteriQual, TIC-MS, Elite, Complete Calibrations, e2b and Alliance had occurred at the beginning of fiscal year 2023 .
+Added: The following unaudited pro forma information presents the Company’s results of operations as if the acquisitions of Essco had occurred at the beginning of fiscal year 2025.
The pro forma results do not purport to represent what the Company’s results of operations actually would have been if the transactions had occurred at the beginning of the period presented or what the Company’s operating results will be in future periods.
10 unchanged sentences
The Company accrues for contingent consideration and holdback provisions based on their estimated fair value at the date of acquisition and at subsequent remeasurement periods, as applicable.
−Removed: As of March 29, 2025 , no contingent consideration and $ 2.8 million of other holdback amounts were unpaid and are reflected in current liabilities on the Consolidated Balance Sheets and $ 1.6 million of other holdback amounts unpaid are reflected in other liabilities in the Consolidated Balance Sheets.
−Removed: During fiscal year 2025, $ 2.7 million of holdback amounts were paid.
+Added: As of March 28, 2026 , no contingent consideration and $ 2.2 million of other holdback amounts were unpaid and are reflected in accrued compensation and other current liabilities on the Consolidated Balance Sheets.
+Added: As of March 29, 2025, no contingent consideration and $ 2.8 million of other holdback amounts were unpaid and reflected in current liabilities on the Consolidated Balance Sheets and $ 1.6 million of other holdback amounts unpaid were reflected in other liabilities in the Consolidated Balance Sheets.
+Added: $ 2.7 million of holdback amounts were paid in fiscal year 2026 and 2025, respectively.
During fiscal year 2024, $ 0.8 million of holdback amounts were paid.
−Removed: During fiscal year 2023 , no contingent consideration or other holdback amounts were paid.
During fiscal years 2026 , 2025 and 2024 , acquisition costs of $ 0.7 million, $ 1.3 million and $ 1.2 million, respectively, were recorded as incurred as general and administrative expenses in the Consolidated Statements of Income.
5 unchanged sentences
A portion of the net proceeds from this Offering were used to pay off the revolving credit facility in full.
−Removed: During each of fiscal years 2025 , 2024 and 2023 , the Company repurchased and subsequently retired less tha n 0.1 mill i on shares of its common stock.
−Removed: The Company allows its employees the option of satisfying the employee tax withholding obligations with either cash or a net share repurchase.
−Removed: The repurchase of shares was for the net awarding of certain share awards to cover employee tax-withholding obligations for share award and stock option activity, totaling $ 3.6 million in fiscal year 2025 , $ 4.9 million in fiscal year 2024 and $ 0.4 million in fiscal year 2023 .
−Removed: The re were no stock option redemptions during fiscal year 2025 , fiscal year 2024 or fiscal year 2023 .
+Added: The Company allows its employees the option of satisfying the employee tax withholding obligations with either cash or a net share issuance.
+Added: The net issuance of shares was due to covering employee tax-withholding obligations for share award and stock option activity, totaling $ 0.4 million in fiscal year 2026 , $ 3.6 million in fiscal year 2025 and $ 4.9 million in fiscal year 2024 .
+Added: NOTE 11 – SUBSEQUENT EVENTS
+Added: Effective March 29, 2026, Jaime Irick became the Company's President and Chief Executive Officer.
+Added: The Company entered into an executive employment agreement (the “Employment Agreement”) with Mr.
+Added: Irick that is effective as of March 29, 2026.
+Added: Pursuant to the Employment Agreement, Mr.
+Added: Irick will be entitled to an initial base salary of $ 650,000 per annum, a target performance-based cash incentive award of 100% of his base salary for fiscal 2027, and equity incentive awards under the Company’s long-term incentive compensation plan, consistent with the Company’s historical awards for executive officers, with a target value of $ 2.3 million for fiscal 2027.
+Added: Irick will be subject to the Company’s stock ownership objectives for directors and executive officers and is eligible to participate in and receive benefits under the Company’s standard benefit programs.
+Added: On April 9, 2026, the Company acquired SCM Metrology and Laboratories S.A, a privately-held calibration services provider, based in Costa Rica to advance the Company's strategy to grow alongside customers in high-growth, highly regulated markets.
+Added: The acquisition price of approximately $ 13 million was paid in cash and is subject to customary adjustments and holdback provisions.
+Added: The acquisition will be accounted for as a business combination under ASC 805, Business Combinations .
+Added: As of the date these financial statements were issued, the Company has not completed its initial accounting for the acquisition because the valuation of certain assets acquired and liabilities assumed, including but not limited to identifiable intangible assets, property and equipment, and contingent liabilities, is still in process.
+Added: Accordingly, the Company is unable to provide the disclosures required by ASC 805, including the preliminary allocation of purchase consideration and certain pro forma financial information.
+Added: The Company expects to finalize the initial accounting for the acquisition as soon as practicable during the measurement period.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.