OREANDA-NEWS. Mesa Laboratories, Inc. (NASDAQ:MLAB) (we, us, our, “Mesa” or the “Company”) today reported record net income and revenues for both the quarter and the year ended March 31, 2016.

Highlights for the quarter and year ended March 31, 2016 as compared to the same periods last year:  

  • Revenues increased 34 and 19 percent, respectively
  • Non-GAAP adjusted net income1 increased 70 and 23 percent, respectively
  • Operating income increased 39 and three percent, respectively
  • Net income increased 78 and 17 percent, respectively

Revenues for the fourth quarter increased 34 percent to $24,812,000 as compared to $18,560,000 for the same quarter last year.  Operating income for the fourth quarter increased 39 percent to $5,843,000 as compared to $4,202,000 for the same quarter last year.  Net income for the fourth quarter increased 78 percent to $3,991,000 or $1.06 per diluted share of common stock as compared to $2,239,000 or $0.61 per diluted share of common stock for the same quarter last year.  Net income for the fourth quarter was impacted by a $101,000 reduction in income tax expense which resulted from the adoption of a new accounting standard which requires excess tax benefits and deficiencies associated with share-based payment awards to employees to be accounted for as income tax benefit (expense) as compared to the same quarter in the previous year whereby they were accounted for as an increase (decrease) to equity.

Revenues for the year ended March 31, 2016 increased 19 percent to $84,659,000 as compared to $71,330,000 last year.  Operating income for the year ended March 31, 2016 increased three percent to $16,323,000 as compared to $15,864,000 last year. Net income for the year ended March 31, 2016 increased 17 percent to $11,169,000 or $2.97 per diluted share of common stock as compared to $9,583,000 or $2.63 per diluted share of common stock last year. Operating income and net income for the year ended March 31, 2016 were impacted by an unusual item consisting of $1,709,000 expense, before tax, related to a litigation settlement associated with the Amega Acquisition.  Net income for the year ended March 31, 2016 was also impacted by an $860,000 reduction in income tax expense as discussed above.  Operating income and net income for the year ended March 31, 2015 were impacted by an unusual item consisting of $460,000 (before tax) of expenses associated with uncollected sales tax liabilities. 

On a non-GAAP basis, adjusted net income (which excludes the non-cash impact of amortization of intangible assets, net of tax) for the fourth quarter increased 70 percent to $4,973,000 or $1.33 per diluted share of common stock as compared to $2,930,000 or $0.80 per diluted share of common stock for the same quarter last year.  Adjusted net income for the year ended March 31, 2016 increased 23 percent to $15,324,000 or $4.08 per diluted share of common stock as compared to $12,502,000 or $3.43 per diluted share of common stock last year.  Adjusted net income for years ended March 31, 2016 and 2015 was impacted by the same items noted above.

“The fourth quarter is usually Mesa’s strongest quarter, but in fiscal year 2016 it was extraordinary,” said John J. Sullivan, President and Chief Executive Officer.  “Not only did we break single quarter records for revenues and profits, but the strong finish resulted in new annual records for these performance metrics, as well.  Certainly, a portion of the record results were due to ERP-related delays in shipments during the previous quarter, as mentioned in last quarter’s release, but we also received record new orders in the fourth quarter.  The strategic acquisitions we completed during the fiscal year, including two during the fourth quarter, helped drive revenues to new records for the quarter and year, but equally important was 17 percent of organic growth in the fourth quarter.  For the year, organic growth was a healthy five percent for our combined Instruments and Biological Indicators divisions, which was partially offset by a slight decline in the Continuous Monitoring division of one percent.  I am especially pleased with Mesa’s underlying profitability for both the fourth quarter and the full year.  During the quarter, adjusted net income (“ANI”) was 20 percent of revenues, which equaled our goal.  For the full fiscal year, excluding the unusual expenses in both fiscal years 2016 and 2015, and the fourth quarter accounting standard change that are mentioned above, ANI would have increased 19 percent for the year, representing 18 percent of revenues.  Overall, Mesa’s fourth quarter was a great finish to another record year for Mesa.”

“I am very pleased with the progress we made during fiscal year 2016,” continued John Sullivan.  “We have grown revenues by 19 percent, while improving underlying profitability, implemented a new state-of-the-art ERP system, entered new markets, introduced new products and expanded our international reach.  While I do not expect the first quarter of fiscal year 2017 to match the stellar fourth quarter results (which is consistent with previous years), the business has very good momentum and I do believe that fiscal year 2017 will be another year of excellent growth for both revenues and profits at Mesa.  We will continue to focus our efforts on improving our distribution channels, we will be introducing several important new products and we are hopeful that we will expand the business through strategic acquisitions.  Our progress during fiscal year 2016 and excellent prospects for fiscal year 2017 are a testament to the hard work and dedication of the nearly 400 talented individuals at Mesa, and I would like to thank them for their efforts.”