Transcat, Inc.

quarter and full fiscal year 2021 conference call and webcast. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Craig Maholick, Investor Relations for Transcat. Thank you. You may begin.

Yeah, thank you. Good morning, everyone. We certainly appreciate your time today and your interest in TransCat. With me here on the call today, we have our President, Chief Executive Officer, Lee Rudow, and our Chief Financial Officer, Mark Dutini. After formal remarks, we'll open the call for questions. If you don't have the news release that crossed the wire after markets closed yesterday, it can be found at our website at transcat.com. The slides that accompany today's discussion are also on our website. If you would, please refer to slide 2. As you are aware, we may make forward-looking statements during the formal presentation and Q&A portion of this teleconference. Those statements apply to future events which are subject to risks and uncertainties as well as other factors that could cause the actual results to differ materially from where we are today. These factors are outlined in the news release as well as the documents filed by the company with the Securities and Exchange Commission. You can find those on our website where we regularly post information about the company as well as on the FCC's website at fcc.gov. We undertake no obligation to publicly update or correct any of the forward-looking statements contained in this call, whether a result of new information, future events, or otherwise, except as required by law. Please review our forward-looking statements in conjunction with these precautionary factors. I'd like to point out as well that during today's call, we will discuss certain non-GAAP measures, which we believe will be useful in evaluating our performance. You should not consider the presentation of this additional information in isolation or as a substitute for results prepared in accordance with GAAP. We have provided reconciliations of non-GAAP to comparable GAAP measures in the tables accompanying your earnings release. So with that, I'll turn the call over to Lee to begin the discussion. Lee?

Thank you, Craig. Good morning, everyone. Thank you for joining us on the call today. Without question, our team is pleased with the fourth quarter results and the results for the full fiscal 2021 year. In both the fourth quarter and full fiscal 2021, we generated record revenue, record operating income, record service margins, and record cash flow. The company fought through the challenges of the pandemic and demonstrated both the inherent resiliency of the business and the adaptability of our dedicated team. Our performance underscores the value of our services and validates the investments we've made in technology, infrastructure, and the talent needed to effectively execute our strategic plan, especially this past year. Our service segment continues to be our primary growth engine. The segment generated strong growth across every financial metric. And in the fourth quarter of fiscal 2021, we returned to double digit organic revenue growth. It was our 48th straight quarter of service growth and resulted in Transcat passing the $100 million annual service revenue mark for service for the first time. In addition to service revenue growth, we delivered outstanding service margin performance. Gross margins were up 500 basis points in the fourth quarter to 33.9%, and for the first time, Our full year service gross margin achieved the milestone of 30%. Operating margin was up 470 basis points in the fourth quarter to 15.1%. Margin gains were primarily driven by technician productivity, inherent operating leverage on organic service revenue growth, and the creative acquisitions of pipettes.com and biotech. Distribution was still impacted by the lingering effect of the pandemic, though we're encouraged by the sequential improvement in the business as distribution turned in its best quarterly result of fiscal 2021. The rental business continues to perform well, up 11% in the fourth quarter. Overall, our fourth quarter operating income exceeded our expectations, hitting $4.5 million, up 21%. Even with the downward pressure caused by the pandemic, operating income for the full year hit a record $11.1 million. We generated record cash flow of $23.6 million during the year. Cash was primarily allocated to support our acquisition strategy, technology investments, and to pay down debt by $10.7 million. Our current leverage ratio is now below one, which provides us flexibility to capitalize on future organic growth opportunities, and margin-enhancing technology developments to drive automation and process improvement into our operation. And of course, our balance sheet will aid in the execution of our next-level acquisition strategy. Before I turn things over to Mark, though, I want to walk through an acquisition, announce an acquisition we made on April 29th. We acquired Upstate Metrology, a small, bolt-on acquisition located nearby our headquarters in Rochester, New York. Upstate Metrology's annual revenue is approximately $1 million, but as a bolt-on, it'll be integrated very quickly with our Rochester-based calibration lab so we can fully leverage our current infrastructure. With that, Mark, I'll turn things over to you.