Mesa Laboratories : Annual Report 2022

2022

ANNUAL REPORT

Shares traded on the NASDAQ Global Market under the symbol MLAB

Year Ended March 31

R E V E N U E S

$200,000

$184,335

$175,000

$150000

$125,000					$117,687	$133,937
		$103,135
$100,000
$96,179
$75,000
$50,000
2018	2019	2020	2021	2022

EARNINGS (LOSS)

$40,000
		$36,139	$37,899
$35,000
$30,000
$24,603	$25,857	$24,361
$25,000

$20,000

$15,000
$10,000		$7,484
			$3,274
$5,000			$1,778
	$(2,962)			$1,871
$0.00
$(-5,000)	2018	2019	2020	2021	2022
		Net Income (loss)	Adjusted Operating income*

EARNINGS (LOSS) PER SH ARE

$8.00				$7.05	$7.10
$7.00	$6.53	$6.41
$6.00			$5.57
$5.00
$4.00
$3.00		$1.86
$2.00
			$0.64
$1.00			$0.41	$0.35
$(0.79)
$0.00
$(-1.00)	2018	2019	2020	2021	2022

Earnings (loss) per diluted share		Adjusted operating income per diluted share*

In thousands, except per share data

• The non-GAAP measure of adjusted operating income is defined to exclude the non-cash impact of amortization of intangible assets acquired in a business combination, stock-based compensation and impairment of goodwill and long-lived assets.

Fellow shareholders,

July 14, 2022

We entered fiscal year 2022 with dedication to our purpose of Protecting the VulnerableTM and a bias toward scaling growth investments that had shown the greatest customer traction during earlier experiments. Our dedication to our purpose, our customers, and The Mesa Way enabled the highest rates of organic growth in our company's history, even while combatting the complexity generated by the evolving COVID pandemic, choppy end market conditions, as well as disruptions in the global supply chain and personnel markets.

We achieved strong results in fiscal year 2022:

• Revenues increased 38% in total and 13% organically
• Non-GAAPadjusted operating income1 excluding unusual items increased 29%
• Completed the largest acquisition in the company's history, Agena Bioscience, Inc. which powered our entry into Clinical Genomics
• Increased our exposure to higher growth end markets in Clinical Genomics, Biopharmaceuticals, and Medical Devices from 60% of revenues to 68% of revenues

Our achievements reached beyond our financial results; we also demonstrated support for our communities through our innovative products that protect the global community every day. During the year, we helped accelerate the development of breakthrough therapies in biopharmaceutical and gene therapies, protect those same therapies all the way to the arms of patients, and ensure that medical procedures were conducted safely.

Over the last several years we have transformed our businesses by focusing on end markets with higher long-term growth rates and acquiring businesses with greater strategic options for innovation. In late 2019 we acquired Gyros Protein Technologies (now the Biopharmaceutical Development division) which concentrates on the Biopharmaceutical end market and compliments the commercial focus of our Calibration Solutions and Sterilization and Disinfection Control divisions. In fiscal year 2022, the acquisition of Agena Bioscience, Inc. ("Agena") provided exposure to the high growth Clinical Genomics market. Agena's MassArray system provides a unique approach to targeted genomic testing at a price point that has the opportunity to further democratize access to the promise of personalized medicine.

The Mesa Way, our lean based and customer focused operating model, provided structure and flexibility for our 700 team members as we continued to navigate the lingering impacts of the COVID-19 pandemic. Each day, our team members demonstrate their deep dedication, customer focus, and adaptability. Through these qualities, we accelerated product development, adapted to changes in the supply chain, innovated how we interact with customers while meeting both their support and safety requirements, and cross trained our teams to flex to where demand was greatest. While our cultural and operational journey is always a work in process, we have made great strides as a team and enter fiscal year 2023 as a stronger, more diverse, and more capable team.

The Mesa Way is central to all we do. Our ability to generate economic value for our shareholders is attributable to The Mesa Way's focus on what matters most: our people, our customers, and our communities. Innovating and delivering high quality products that benefit our customers and broader

communities depends on us attracting, developing, and retaining diverse talent across our organization. Our culture is one that invites people of all backgrounds to contribute and share in our success. Your Board of Directors represents diverse backgrounds: two are women, one is Asian, and one is a member of the LGBTQ+ community. We continue to engage our company's leaders in diversity and inclusion conversations and to create accountability metrics for recruiting and promoting internal candidates with a focus on the most senior levels of the organization. In addition to prioritizing our people, we also prioritize the communities that sustain us and acknowledge the responsibility that all companies have to support communities through an environmental focus. Our production environment has an inherently low environmental impact, consisting primarily of light assembly and calibration. Despite the relatively low carbon impact of our production processes, we also make large and impactful changes with the environment in mind; for example, performing building renovations with an emphasis on conservation as well as materials and processes that are friendly to the environment.

We enter fiscal year 2023 with a long list of risks to navigate and opportunities to improve. Some risks, such as the COVID-19 pandemic, supply chain, and labor constraints carry over from prior years. Other challenges are newer: conflict in Europe, inflation, deteriorating financial markets, and political tension. Inevitably this will be a year of great change that will require us to adapt to both opportunity and challenge. With a motivating purpose of Protecting the VulnerableTM, a stronger team, and The Mesa Way, we will navigate the immediate storm with dedication and passion, learn from the experience to become better as an organization and business, all while remaining focused on driving value for our long term shareholders.

Thank you for your confidence and support,

Gary M. Owens

Chief Executive Officer and President

*Adjusted operating income ("AOI") is a financial measure that is not prepared in accordance with generally accepted accounting principles ("GAAP"). Our Annual Report on 10-K included herein defines and reconciles AOI to the most directly comparable historical GAAP financial measure.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark one)

☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended March 31, 2022

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from ____ to ____
		Commission File No: 0-11740

MESA LABORATORIES, INC.

(Exact name of registrant as specified in its charter)

Colorado		84-0872291
(State or other jurisdiction of		(I.R.S. Employer
Incorporation or organization)		Identification number)
12100 West Sixth Avenue
Lakewood, Colorado		80228
(Address of principal executive offices)		(Zip Code)
Registrant's telephone number, including area code: [phone]
	Securities registered under Section 12(b) of the Act:
Title of each class	Trading Symbol			Name of each exchange on which registered
Common stock, no par value			MLAB			The Nasdaq Stock Market LLC

Securities registered under Section 12(g) of the Act: None