ROCHESTER, NY – Transcat Inc. (NASDAQ:TRNS), a leading provider of calibration and measurement technologies, announced significant changes to its corporate governance structure following its annual shareholders meeting on Tuesday.
The company's shareholders voted to approve an amendment to the corporate bylaws that will declassify the Board of Directors, moving towards annual elections for all directors starting from the 2025 annual meeting.
The decision, effective as of September 11, 2024, signifies a shift from the previous system where the board was divided into classes serving staggered three-year terms. This amendment is expected to enhance the company's corporate governance by allowing shareholders to vote on the entire board each year, thereby potentially increasing accountability and alignment with shareholder interests.
In addition to the Board Declassification Amendment, the annual meeting saw the reelection of three director nominees: Craig D. Cairns, Oksana S. Dominach, and Lee D. Rudow, each to serve a three-year term expiring in 2027.
The shareholders also approved, on an advisory basis, the compensation of the company's named executive officers and ratified the selection of Freed Maxick CPAs, P.C. as the company's independent registered public accounting firm for the fiscal year ending March 29, 2025.
The changes come amid a broader push for corporate transparency and accountability in board structures across various industries. Transcat's move aligns with best practices recommended by governance experts, who argue that annual elections can make boards more responsive to shareholders.
The company, headquartered in Rochester, New York, specializes in instruments for measuring and testing of electricity and electronic signals. It operates under the name 08 Industrial Applications and Services and is incorporated in Ohio with a fiscal year-end of March 30.
In other recent news, Transcat Inc. reported a 10% rise in consolidated revenue, reaching $66.7 million, marking a strong start to fiscal year 2025. This increase was driven by substantial growth in the Services and Rental segments, leading to a 310 basis point expansion in consolidated gross margin to 34%.
Adjusted EBITDA also experienced a significant rise of 20% to $10.2 million. The company's strategic initiatives, such as automation and acquisitions, were emphasized as key contributors to these developments.
The company's Service revenue grew by 10%, and Distribution gross margins expanded by 620 basis points. Despite overall growth, the Service segment's organic growth fell slightly short of expectations. However, Transcat's focus on high-margin Rental business within its Distribution segment is expected to improve margins over time.
Transcat's strategic plans include targeting recurrent revenue streams, particularly in regulatory-demand industries. The company anticipates high single-digit to low double-digit organic Service growth for fiscal year 2025. Additionally, the company is planning strategic acquisitions to enhance its geographic reach and capabilities.
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