Slides
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inTEST Corporation 27th Annual Needham Growth Conference January 16, 2025 Nick Grant President and CEO Duncan Gilmour Chief Financial Officer NYSE American: INTT
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Forward-Looking Statements This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. These statements do not convey historical information but relate to predicted or potential future events and financial results, such as statements of the Company’s plans, strategies and intentions, or our future performance or goals, that are based upon management's current expectations. These forward- looking statements can often be identified by the use of forward-looking terminology such as “believe,” “continuing,” “could,” “expects,” “guidance,” “may,” “outlook,” “should,” “plan,” “potential,” “forecasts,” “outlook,” “targets,” “estimated,” “opportunities” or similar terminology. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to, any mentioned in this presentation as well as the Company’s ability to execute on its 5-Point Strategy, realize the potential benefits of acquisitions and successfully integrate any acquired operations, grow the Company’s presence in its key target and international markets, manage supply chain challenges, convert backlog to sales and to ship product in a timely manner; the success of the Company’s strategy to diversify its markets; the impact of inflation on the Company’s business and financial condition; indications of a change in the market cycles in the semi market or other markets served; changes in business conditions and general economic conditions both domestically and globally including rising interest rates and fluctuation in foreign currency exchange rates; changes in the demand for semiconductors; access to capital and the ability to borrow funds or raise capital to finance potential acquisitions or for working capital; changes in the rates and timing of capital expenditures by the Company’s customers; and other risk factors set forth from time to time in the Company’s Securities and Exchange Commission filings, including, but not limited to, the Annual Report on Form 10-K for the year ended December 31, 2023. Any forward-looking statement made by the Company in this presentation is based only on information currently available to management and speaks to circumstances only as of the date on which it is made. The Company undertakes no obligation to update the information in this presentation to reflect events or circumstances after the date hereof or to reflect the occurrence of anticipated or unanticipated events, except as required by law. Non-GAAP Financial Measures and Forward-Looking Non-GAAP Financial Measures In addition to disclosing results that are determined in accordance with generally accepted accounting practices in the United States (“GAAP”), we also disclose non-GAAP financial measures. These non-GAAP financial measures consist of adjusted net earnings, adjusted earnings per diluted share (adjusted EPS), adjusted EBITDA, adjusted EBITDA margin and free cash flow. The Company defines these non-GAAP measures as follows: - Adjusted net earnings is derived by adding acquired intangible amortization, adjusted for the related income tax expense (benefit), to net earnings (loss). - Adjusted earnings per diluted share (adjusted EPS) is derived by dividing adjusted net earnings by diluted weighted average shares outstanding. - Adjusted EBITDA is derived by adding acquired intangible amortization, net interest expense, income tax expense, depreciation, and stock-based compensation expense to net earnings. - Adjusted EBITDA margin is derived by dividing adjusted EBITDA by revenue. - Free cash flow is derived by subtracting capital expenditures from net cash provided by or used in operating activities. These results are provided as a complement to the results provided in accordance with GAAP. Adjusted net earnings and adjusted earnings per diluted share (adjusted EPS) are non-GAAP financial measures presented to provide investors with meaningful, supplemental information regarding our baseline performance before acquired intangible amortization charges as management believes this expense may not be indicative of our underlying operating performance. Adjusted EBITDA and adjusted EBITDA margin are non-GAAP financial measures presented primarily as a measure of liquidity as they exclude non-cash charges for acquired intangible amortization, depreciation and stock-based compensation. In addition, adjusted EBITDA and adjusted EBITDA margin also exclude the impact of interest income or expense and income tax expense or benefit, as management believes these expenses may not be indicative of our underlying operating performance. The non-GAAP financial measures presented in this presentation are used by management to make operational decisions, to forecast future operational results, and for comparison with our business plan, historical operating results and the operating results of our peers. Reconciliations from net earnings and earnings per diluted share (EPS) to adjusted net earnings and adjusted earnings per diluted share (adjusted EPS) and from net earnings and net margin to adjusted EBITDA and adjusted EBITDA margin, are contained in the tables below. Each of our non-GAAP measures have limitations as analytical tools. They should not be viewed in isolation or as a substitute for GAAP measures of earnings or cash flows. Limitations may include the cash portion of interest expense, income tax (benefit) provision, charges related to intangible asset amortization and stock-based compensation expense. These items could significantly affect our financial results. Management believes these Non-GAAP financial measures are important in evaluating our performance, results of operations, and financial position. We use non-GAAP financial measures to supplement our GAAP results to provide a more complete understanding of the factors and trends affecting our business. Adjusted net earnings, adjusted earnings per diluted share (adjusted EPS), adjusted EBITDA, and adjusted EBITDA margin are not alternatives to net earnings, earnings per diluted share or margin as calculated and presented in accordance with GAAP. As such, they should not be considered or relied upon as substitutes or alternatives for any such GAAP financial measure. We strongly urge you to review the reconciliations of adjusted net earnings, adjusted earnings per diluted share (adjusted EPS), adjusted EBITDA, and adjusted EBITDA margin along with our financial statements included elsewhere in this presentation. We also strongly urge you not to rely on any single financial measure to evaluate our business. In addition, because adjusted net earnings, adjusted earnings per diluted share (adjusted EPS), adjusted EBITDA, and adjusted EBITDA margin are not measures of financial performance under GAAP and are susceptible to varying calculations, the adjusted net earnings, adjusted earnings per diluted share (adjusted EPS), adjusted EBITDA, and adjusted EBITDA margin measures as presented in this presentation may differ from and may not be comparable to similarly titled measures used by other companies. 2 Key Performance Metrics In addition to the foregoing non-GAAP measures, management uses orders and backlog as key performance metrics to analyze and measure the Company’s financial performance and results of operations. Management uses orders and backlog as measures of current and future business and financial performance, and these may not be comparable with measures provided by other companies. Orders represent written communications received from customers requesting the Company to provide products and/or services. Backlog is calculated based on firm purchase orders we receive for which revenue has not yet been recognized. Management believes tracking orders and backlog are useful as it often is a leading indicator of future performance. In accordance with industry practice, contracts may include provisions for cancellation, termination, or suspension at the discretion of the customer. Given that each of orders and backlog are operational measures and that the Company's methodology for calculating orders and backlog does not meet the definition of a non-GAAP measure, as that term is defined by the U.S. Securities and Exchange Commission, a quantitative reconciliation for each is not required or provided.
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Unlocking The Potential Vision To be the supplier of choice for innovative test and process technology solutions Mission Leverage our deep industry knowledge & expertise to develop and deliver high quality, innovative customer solutions and superior support for complex global challenges 3 Duncan Gilmour Chief Financial Officer and Treasurer Market Capitalization $107 million Recent Closing Price $8.64 52 Week High / Low $14.35 / $6.28 Shares Outstanding ~12.4 million Institutional Ownership ~56% Insider Ownership ~5% 34% 24% 42% Process Technologies Environmental Technologies Electronic Test $122.0M Market data as of January 10, 2025, Source: FactSet Shares Outstanding as of October 31, 2024; Ownership as of most recent filing. Nick Grant President and CEO Q3 TTM 2024
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Transforming inTEST Transition from Components to Solutions Provider 1 Shift to Diversified Markets with Long-term, Secular Tailwinds 2 Increase SAM with Multi-Billion Market Opportunity with Outsized Growth 4 Strategic Acquisitions to Reinforce Growth Prospects 3 New Organizational Structure Unlocking Potential 5 Marquee, Blue-Chip Customer Base 4
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Strong Foundation For Growth inTEST: Known for Highly-Engineered, Customer-Driven Solutions Growing and Diversified Markets ➢ Semiconductor ➢ Industrial ➢ Automotive/EV ➢ Defense/Aerospace ➢ Life Sciences ➢ Security ➢ Consumer Electronics Blue-Chip Global Customer Base Global Presence ➢ Q3 TTM 2024 Revenue: $122M ▪ 43.7% Americas ▪ 27.0% APAC ▪ 29.3% EMEA ➢ Manufacturing operations in U.S., Canada, Europe ➢ Global sales and service organization Blue-Chip Global Customer Base 5
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5-Point Strategy Drives Long-Term Value ✓ Growth Driven by Geographic Expansion, Increasing Customer Base, Broader & Deeper Market Penetration 6 ✓ Drive Innovation and Technological Differentiation ✓ Enhance Service and Support to Develop Recurring Revenue ✓ Foster Culture of Engagement and Accountability ✓ Build Strong Bench of Talent ✓ Pursue Acquisitions and Partnerships to Expand Markets, Customer Base and Offerings Global & Market Expansion Talent & Culture Strategic Acquisitions & Partnerships Service & Support Innovation & Differentiation
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Acquired Alfamation in March 2024 7 48% 17% 5% 5% 3% 3% 3% Others, 16% FY23 Customer Concentration Six additional new, large customers in backlog • Headquarters: Milan, Italy • Sales and service center in Suzhou City, China • ~130 employees • Founder owned business • Staying on to execute growth plans • Customers/markets: • Global OEMs & tier-ones for Auto/EV • Life sciences and consumer electronics manufacturers • Highly fragmented Test & Measurement industry 89% 7% 3% 1% FY23 Sales by Industry Segment Automotive Consumer Electronics Life Sciences Others € 12.8 € 17.4 € 23.6 Sales* FY21 FY22 FY23 *Fiscal year ended June 30
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Consistent with 5-Point Strategy for Growth Cultural fit as an innovative engineering and technology solutions provider Strategic Fit: expands test capabilities and footprint in Europe Deepens market reach in auto/EV, life sciences & consumer electronics Best-in-class engineering talent and testing know-how Sizable business with substantial backlog; demonstrated growth + Expands Electronic Test Capabilities 8
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53% 12% 8% 10% 4% 3% 10% 2023 inTEST Revenue by Market Driving Market Leadership/Opportunities Targeting markets with strong, secular tailwinds 9 Semi Industrial Life SciencesDefense/AeroAuto/EV Security Other $84.9M $123.3M 65%8% 7% 6% 3% 1% 10% 2021 39% 14% 21% 10% 4% 2% 10% Q3 TTM 2024 $122.0M
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➢ Growth drivers: semi mixed-signal/analog focused, strength in auto/EV market and growing presence in defense and life sciences ➢ Markets: back-end semi, auto/EV, industrial, life sciences, defense/aero and consumer electronics ➢ Automating and integrating for back-end semi test: enables testers to work with virtually all handlers/probers ➢ Proprietary flying probe technology provides broadest testing capabilities & enhanced throughput for PCB testing ➢ Increasing productivity and quality for EV/battery testing with automated interconnect verification ➢ Solutions: ▪ Semiconductor test interfaces, docking solutions and manipulators ▪ Integrated circuit flying probe and battery test systems / test services ▪ Automated electronics test solutions for auto/EV infotainment systems & consumer electronics Electronic Test Division Engineering solutions for the toughest challenges in automated test 40 YEARS OF ENABLING ADVANCED ELECTRONIC TEST 10 42%
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➢ Growth drivers: strong position in back-end semi, expanding in defense/aero, industrial and auto/EV ▪ Thermal testing/processing solutions that provide precise temperature controls for industrial, satellites, space exploration and defense systems ▪ Process Chillers providing tight temperature control in a wide variety of applications (EV inverter testing, cannabis extraction, etc.) ➢ Key products: ▪ Thermal Test Systems: -185°C to 500°C (-300°F to 930°F) ▪ Process Chillers: -100°C to 300°C (-148°F to 570°F) ➢ Environmental responsibility ▪ Low-impact refrigerants ▪ Low power consumption ▪ RoHS and REACH compliant Environmental Technologies Division Controlling environmental conditions in test, process and storage applications OVER 50,000 SYSTEMS INSTALLED IN MORE THAN 40 COUNTRIES 11 24%
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➢ Growth drivers: ▪ Technologies serve large, diverse and growing markets: semi front-end, auto/EV, defense/aerospace, security, life sciences and other varied applications ▪ Induction heating solutions for gallium nitride and silicon carbide crystal growth, epitaxy as well as green solution to replace traditional fossil fuel heating processes with higher thermal efficiency ▪ Board level camera capture technology supports automation/robotics, positioning, identification and inspection ▪ SAM expansion thru identification of new applications, product development, global lab extension and acquisitions ➢ Key Products: ▪ Induction heating systems range from 500 W to 1,000 kW ▪ Industrial grade cameras and embedded image capture systems ➢ Environmental benefits: ▪ Induction heating only uses electricity; is cleaner and safer ▪ Camera systems providing safer, more efficient roadways ▪ Our systems are used to build renewable products Process Technologies Division Technical expertise and customized solutions for industrial applications 12 OVER 17,000 INDUCTION HEATING SYSTEMS AND MORE THAN 1 MILLION CAMERAS INSTALLED IN MORE THAN 50 COUNTRIES 34%
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Making M&A a Core Competency M&A Eco- System M&A Pipeline Banking Relationships Strategic Partnerships Strategy Development M&A Execution Acquire quality businesses to drive shareholder value Defining/developing partners that strengthen our strategy Core competency creates exposure to opportunities Disciplined M&A Process Expand into fast growing markets Offer broader portfolio of solutions Drive further market diversification Enhance value-added technology Partnerships and private label opportunities Enhance financial profile of company M&A Eco-System 13 Completed four acquisitions since implementing 5-Point Strategy
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14 Process Technologies Electronic Test Environmental Technologies Electronic Test ▪ Broader and complementary technology/applications ▪ Diversify outside of Semi market ▪ Deepen geographic market reach in Europe, Asia, Latin America ▪ Expand customer base Environmental Technologies ▪ Higher growth markets and complementary technologies ▪ Expand beyond thermal (vibration, humidity, stress, etc.) ▪ Larger capital equipment/average unit selling price ▪ Market share expansion in Defense, Aerospace, Auto/EV Process Technologies ▪ Expanding RF capabilities ▪ Geographic expansion (Europe/Asia/Latin America) ▪ Automation and broader solution plays ▪ Emerging/adopting industrial technologies Acquisition Strategy: Scaling Divisions Success Building Our Vision ? ?? Innovative Test and Process Technology Solutions ?
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15 Financial Overview
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Orders and Backlog(1) ($ in millions) ➢ Q3 orders up 4.5% y/y ▪ Includes $3.9 million from Alfamation ▪ $4.1 million increase in auto/EV, more than doubled driven by Alfamation ▪ More investments directed to ICE(2) autos ▪ Def/aero spending remains robust, up $1.4 million, or 47% ➢ Sequentially, orders up 7.1% ▪ Auto/EV, defense/aerospace, security and other offset decline in semi ➢ Backlog up $5.0 million, or 12.3%, y/y ▪ Includes $14.7 million from Alfamation ▪ Approximately 42% of backlog is expected to ship beyond Q4 2024 16(1) Orders and backlog are key performance metrics. Further information can be found under “Key Performance Metrics.” (2) Internal combustion engine $26.9 $26.2 $28.1 Q3 23 Q2 24 Q3 24 $101.9 $129.6 $116.6 $104.6 2021 2022 2023 TTM Q3 2024 ORDERS $40.5 $40.1 $55.5 $47.7 $45.5 9/30/2023 12/31/2023 3/31/2024 6/30/2024 9/30/2024 BACKLOG QuartersYears
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Revenue ➢ Q3 2024 revenue, decreased $0.7 million y/y ▪ $5.4 million from Alfamation ▪ Auto/EV up $4.5 million, primarily from Alfamation ▪ $7.1 million decline in semi sales ▪ Industrial market up $1.1 million and other markets up $1.3 million ➢ Diversification progress continues ▪ Alfamation serves auto/EV, life sciences and consumer electronic markets ➢ Sequentially, revenue decreased $3.7 million ▪ Approximately $2 million in shipments delayed into the fourth quarter ▪ Industrial and other markets, combined, up $0.9 million ▪ Semi revenue up 13%, $1.3 million on back-end improvement ▪ Compares with unusually strong quarter for Alfamation, which contributed $9.7 million in Q2 $84.9 $116.8 $123.3 $122.0 2021 2022 2023 TTM Q3 2024 Years 39% 21% 14% 10% 4% 2% 10% TTM Q3 2024 17 ($ in millions) $30.9 $34.0 $30.3 Q3 2023 Q2 2024 Q3 2024 Quarters Semi Automotive/EV Industrial Defense/Aero Life Sciences Security Other
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Gross Profit and Margin ($ in millions) 18 $14.4 $13.8 $14.0 46.7% 40.6% 46.3% Q3 2023 Q2 2024 Q3 2024 $41.2 $53.4 $57.0 $53.3 48.6% 45.7% 46.2% 43.7% 2021 2022 2023 TTM Q3 2024 QuartersYears ➢ Q3 gross margin of 46.3% expanded 570 bps compared with Q2 2024 ▪ Margin expansion driven by favorable product mix and cost actions ▪ Improved volume in higher margin back-end semi business ➢ Y/Y gross margin nominally unchanged on lower revenue
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NOTE: Components may not add up to totals due to rounding. Operating Expenses ➢ Q3 2024 operating expenses up $1.5 million versus Q3 2023 ▪ $2.3 million incremental operating expenses attributable to Alfamation (including $460,000 in amortization) ▪ Offset by cost reduction efforts and lower business development costs ➢ Sequentially, operating expenses essentially flat ($ in millions) Continuing to invest to support 5-Point Strategy for Growth 19 $4.3 $4.1 $4.3 $1.8 $2.2 $2.2 $5.9 $7.1 $7.1 $12.0 $13.5 $13.5 Q3 2023 Q2 2024 Q3 2024 44.7%38.7% Operating expenses as a % of sales $11.1 $15.9 $17.6 $17.2 $5.5 $7.5 $7.6 $8.3$15.9 $19.3 $21.3 $25.4 $32.5 $42.7 $46.5 $50.9 2021 2022 2023 TTM Q3 2024 QuartersYears 38.3% 36.6% 37.7% 41.7% Selling Engineering G&A 39.6%
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$2.3 $0.2 $0.5 $3.8 $2.2 $2.4 12.2% 6.3% 8.1% Q3 23 Q2 24 Q3 24 Earnings and Adjusted EBITDA(1) $0.19 $0.02 $0.04 $0.22 $0.08 $0.10 Q3 23 Q2 24 Q3 24 EPS and Adjusted EPS(1) (1) Adjusted EPS, adjusted EBITDA and adjusted EBITDA margin are non-GAAP financial measures. Further information can be found under “Non-GAAP Financial Measures and Forward-Looking Non-GAAP Financial Measures.” See also the reconciliations of GAAP financial measures to non-GAAP financial measures that accompany this presentation. Net Earnings and Adjusted EBITDA/ Adjusted EBITDA Margin (1) 20 ($ in millions, except per share data) $7.3 $8.5 $9.3 $2.8 $12.0 $16.0 $15.8 $8.8 14.2% 13.7% 12.8% 7.2% 2021 2022 2023 TTM Q3 2024 Net Earnings Adjusted EBITDA $0.68 $0.78 $0.79 $0.23 $0.81 $0.99 $0.94 $0.43 2021 2022 2023 TTM Q3 2024 EPS Adjusted EPS Quarters Quarters Years Years (1) (1)
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Capital Structure and Cash Flow ($ in millions) NOTE: Components may not add up to totals due to rounding. (1) Free cash flow and adjusted EBITDA are non-GAAP financial measures. Further information can be found under “Non-GAAP Financial Measures and Forward-Looking Non-GAAP Financial Measures.” See also the reconciliation of GAAP financial measures to non-GAAP financial measures in the tables that accompany this presentation for Adjusted EBITDA and above for the reconciliation of free cash flow. 21 Capitalization 9/30/24 12/31/23 Cash and cash equivalents $ 18.0 $ 45.3 Total debt $ 16.1 $ 12.0 Shareholders’ equity $ 100.4 $ 96.3 Total capitalization $ 116.5 $ 108.3 ➢ Paid down $5.3 million in debt during the quarter and invested $1.0 million to repurchase 141,117 shares ➢ Approximately $58 million in liquidity at quarter end ▪ Includes $18.0 million in cash ▪ $40 million borrowing capacity, includes $30 million delayed draw term loan, and $10 million revolving line of credit ➢ Continue to expect capital expenditures of approximately 1% to 2% of revenue Cash Flow Three Months Ended Year Ended 9/30/24 9/30/23 12/31/23 Net cash provided by operating activities $ 4.2 $ 6.2 $ 16.2 Capital expenditures (0.5) (0.3) (1.3) Free cash flow (FCF) (1) $ 3.7 $ 5.9 $ 14.9
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Capital Allocation Priorities 22 Disciplined Approach To Capital Allocation, Flex with Market Conditions Return of Capital M&AReduce Debt Organic Growth ✓ Invest in engineering, sales & marketing ✓ Innovate with new products and capabilities ✓ Maintain financial flexibility: Total debt / TTM adjusted EBITDA(1) leverage ratio was ~1.8x ✓ Identify accretive acquisition opportunities that align with three divisions ✓ Opportunistically return capital to shareholders with share repurchases
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Tightened Outlook for 2024 Note: purchase price accounting for Alfamation is not complete. Adjustments when completed could be material. (1) Guidance provided November 1, 2024. The foregoing guidance is based on management’s current views with respect to operating and market conditions and customers’ forecasts. It also assumes macroeconomic conditions remain unchanged through the end of the year and does not take into account any extraordinary non-operating expenses that may occur from time to time. Actual results may differ materially from what is provided here today as a result of, among other things, the factors described under “Forward-Looking Statements” on slide 2. (2) Adjusted EPS is a non-GAAP financial measure. Further information can be found under “Non-GAAP Financial Measures and Forward-Looking Non-GAAP Financial Measures.” See also the reconciliations of GAAP financial measures to non-GAAP financial measures that accompany this presentation. 5-Point Strategy Global & Market Expansion Talent & Culture Strategic Acquisitions & Partnerships Service & Support Innovation & Differentiation 23 Fourth Quarter Outlook(1) Revenue: $34 million to $37 million Gross margin: ~42% Operating expenses: ~$13.5 million Intangible asset amortization expense: ~$0.9 million Amortization (after tax): ~$0.7 million Interest expense: ~$210,000 EPS at midpoint: ~$0.08 Adjusted EPS(2) at midpoint (Non-GAAP): ~$0.14 Full Year Outlook(1) Current Revenue: $128 million to $131 million Gross margin: 42% to 43% Operating expenses: ~$53 million Intangible asset amortization expense: ~$3.3 million Amortization (after tax): ~$2.7 million Effective tax rate: 17% to 19%
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Executing on our Strategy • Seeing gradual improvement in back-end semi • Solid demand from defense/aerospace • Front-end semi currently paused, but exciting long-term opportunity with unique induction heating solution for SiC, GaN and epitaxy Limited visibility but signs of stabilization in targeted industries • Ongoing optimization of channel partners and geographic/market reach • Continuously adding new customers and gaining wallet share with existing customers • Expanding applications: defense/aerospace and green energy • Driving innovation across the businesses Optimizing channels to markets • Capturing price, operational efficiencies and managing costs Focus on profitability with cost discipline and rightsizing actions 24
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inTEST Corporation 27th Annual Needham Growth Conference January 16, 2025 Nick Grant President and CEO Duncan Gilmour Chief Financial Officer NYSE American: INTT
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inTEST Corporation Supplemental Information
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Competition 27 Solutions / Markets Competitors Manipulators Advantest Corporation, Esmo AG, Reid-Ashman Manufacturing and Teradyne, Inc. Docking Hardware Advantest Corporation, Esmo AG, Reid-Ashman Manufacturing and Teradyne, Inc. Tester Interfaces Advantest Corporation, Esmo AG, Reid-Ashman Manufacturing and Teradyne, Inc. Acculogic Digitaltest GmbH, Seica S.P.A., SPEA S.P.A., and Takaya Corporation Thermostream® FTS Systems, a part of SP Industries, and MPI Corporation Environmental Chambers Cincinnati Sub-Zero Products, Inc., Espec Corp. and Thermotron Industries Thermal Platforms Environmental Stress Systems Inc. Liquid Chillers Huber Kältemaschinenbau AG, Julabo GmbH, Boyd Corporation, and Advanced Thermal Sciences Corporation Life Sciences Panasonic Health Care Holdings Corporation, Haier Group Corporation, Thermo Fisher Scientific Corporation, and Eppendoerf AG EKOHEAT® and EASYHEAT Inductotherm Corporation, Park-Ohio Holdings, EFD Induction Corporation, Trumpf Huettinger GmbH, Ultraflex Power Technologies and CEIA SpA Digital Streaming / Image Capturing A large space with multiple small competitors. There is no competitor that has over 5% share of the current market.
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28 ($ in thousands, except per share amounts) Reconciliation of Net Earnings to Adjusted Net Earnings (Non-GAAP) and Earnings Per Diluted Share to Adjusted Earnings Per Diluted Share (Non-GAAP) (1) Components may not add up to totals due to rounding. Three Months Ended 9/30/2023 12/31/2023 3/31/2024 6/30/2024 9/30/2024 Net earnings $ 2,277 $ 1,455 $ 662 $ 230 $ 495 Acquired intangible amortization 515 513 595 897 944 Tax adjustments (85) (58) (95) (168) (223) Adjusted net earnings (Non-GAAP) $ 2,707 $ 1,910 $ 1,162 $ 959 $ 1,216 Diluted weighted average shares outstanding 12,212 12,122 12,158 12,330 12,252 Net earnings per diluted share:(1) Net earnings $ 0.19 $ 0.12 $ 0.05 $ 0.02 $ 0.04 Acquired intangible amortization 0.04 0.04 0.05 0.07 0.08 Tax adjustments (0.01) - (0.01) (0.01) (0.02) Adjusted net earnings per diluted share (Non-GAAP) $ 0.22 $ 0.16 $ 0.10 $ 0.08 $ 0.10
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29 ($ in thousands, except per share amounts) Reconciliation of Net Earnings to Adjusted Net Earnings (Non-GAAP) and Earnings Per Diluted Share to Adjusted Earnings Per Diluted Share (Non-GAAP) (1) Components may not add up to totals due to rounding. Years Ended December 31, TTM Q3 2021 2022 2023 2024 Net earnings $ 7,283 $ 8,461 $ 9,342 $ 2,842 Acquired intangible amortization 1,440 2,694 2,095 2,949 Tax adjustments (22) (447) (324) (544) Adjusted net earnings (Non-GAAP) $ 8,701 $ 10,708 $ 11,113 $ 5,247 Diluted weighted average shares outstanding 10,730 10,863 11,780 12,216 Net earnings per diluted share:(1) Net earnings $ 0.68 $ 0.78 $ 0.79 $ 0.23 Acquired intangible amortization 0.13 0.25 0.18 0.24 Tax adjustments - (0.04) (0.03) (0.04) Adjusted net earnings per diluted share (Non-GAAP) $ 0.81 $ 0.99 $ 0.94 $ 0.43
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30 ($ in thousands) Reconciliation of Net Earnings and Net Margin to Adjusted EBITDA (Non-GAAP) and Adjusted EBITDA Margin (Non-GAAP) Three Months Ended 9/30/2023 12/31/2023 3/31/2024 6/30/2024 9/30/2024 Net earnings $ 2,277 $ 1,455 $ 662 $ 230 $ 495 Acquired intangible amortization 515 513 595 897 944 Net interest expense (income) (276) (340) (193) 41 36 Income tax expense 446 111 125 66 74 Depreciation 262 255 273 356 355 Non-cash stock-based compensation 544 424 349 564 537 Adjusted EBITDA (Non-GAAP) $ 3,768 $ 2,418 $ 1,811 $ 2,154 $ 2,441 Revenue 30,941 27,884 29,824 33,991 30,272 Net margin 7.4% 5.2% 2.2% 0.7% 1.6% Adjusted EBITDA margin (Non-GAAP) 12.2% 8.7% 6.1% 6.3% 8.1%
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31 ($ in thousands) Reconciliation of Net Earnings and Net Margin to Adjusted EBITDA (Non-GAAP) and Adjusted EBITDA Margin (Non-GAAP) Years Ended December 31, TTM Q3 2021 2022 2023 2024 Net earnings $ 7,283 $ 8,461 $ 9,342 $ 2,842 Acquired intangible amortization 1,440 2,694 2,095 2,949 Net interest expense (income) 89 600 (404) (456) Income tax expense 1,119 1,684 1,706 376 Depreciation 666 810 1,021 1,239 Non-cash stock-based compensation 1,450 1,787 2,047 1,874 Adjusted EBITDA (Non-GAAP) $ 12,047 $ 16,036 $ 15,807 $ 8,824 Revenue 84,878 116,828 123,302 121,971 Net margin 8.6% 7.2% 7.6% 2.3% Adjusted EBITDA margin (Non-GAAP) 14.2% 13.7% 12.8% 7.2%
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32 Reconciliation of Fourth Quarter 2024 Estimated Earnings Per Diluted Share to Estimated Adjusted Earnings Per Diluted Share (Non-GAAP) Q4 2024E Estimated earnings per diluted share ~ $ 0.08 Estimated acquired intangible amortization ~ 0.08 Estimated tax adjustments ~ (0.02) Estimated adjusted earnings per diluted share (Non-GAAP) ~ $ 0.14
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33 Segment Reporting (Quarterly) ($ in thousands) Three Months Ended 9/30/2023 12/31/2023 3/31/2024 6/30/2024 9/30/2024 Electronic Test $ 11,547 $ 8,105 $ 11,116 $ 16,159 $ 15,481 Environmental Technologies 7,000 7,623 6,828 8,273 6,734 Process Technologies 12,394 12,156 11,880 9,559 8,057 Total Revenue $ 30,941 $ 27,884 $ 29,824 $ 33,991 $ 30,272 % of divisional revenue % of divisional revenue % of divisional revenue % of divisional revenue % of divisional revenue Electronic Test $ 3,268 28% $ 1,702 21% $ 1,813 16% $ 1,743 11% $ 2,311 15% Environmental Technologies 523 7% 594 8% 15 0% 993 12% 426 6% Process Technologies 2,094 17% 2,182 18% 1,961 17% 970 10% 1,070 13% Total income from divisional operations 5,885 19% 4,478 16% 3,789 13% 3,706 11% 3,807 13% Corporate expense (2,902) (2,856) (2,702) (2,473) (2,376) Acquired intangible amortization (515) (513) (595) (897) (944) Interest expense (168) (153) (140) (253) (219) Other income 423 610 435 213 301 Earnings before income tax expense $ 2,723 $ 1,566 $ 787 $ 296 $ 569
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34 Segment Reporting (12-Months) ($ in thousands) Years Ended TTM 12/31/2022 12/31/2023 9/30/2024 Electronic Test $ 40,219 $ 41,016 $ 50,861 Environmental Technologies 30,172 30,801 29,458 Process Technologies 46,437 51,485 41,652 Total Revenue $ 116,828 $ 123,302 $ 121,971 % of divisional revenue % of divisional revenue % of divisional revenue Electronic Test $ 9,931 25% $ 10,189 25% $ 7,569 15% Environmental Technologies 3,817 13% 3,073 10% 2,028 7% Process Technologies 8,230 18% 9,544 19% 6,183 15% Total income from divisional operations 21,978 19% 22,806 18% 15,780 13% Corporate expense (8,563) (10,272) (10,407) Acquired intangible amortization (2,694) (2,095) (2,949) Interest expense (635) (679) (765) Other income 59 1,288 1,559 Earnings before income tax expense $ 10,145 $ 11,048 $ 3,218
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inTEST Corporation 27th Annual Needham Growth Conference January 16, 2025 Investor Relations Contact: Deborah K. Pawlowski, Alliance Advisors IR 716-843-3908 dpawlowski@allianceadvisors.com