Shareowners
ANNUAL
REPORT
2016
Making the Trusted Difference In Our Customers’ Success
Our increasingly connected world makes wireless a necessity, the vital link among us all. TESSCO’s
depth of wireless product offering, passionate customer teams and reliable programs and services
make us the industry’s most trusted partner for building, using, maintaining, and providing wireless
voice, data, and video. TESSCO is dedicated to being the singular source for wireless solutions and
connectivity for our customers. We call this the Power of ONE, and at TESSCO our team members
work hard every day to make the trusted difference in our customers’ success.
Coverage
& Capacity
Wi-Fi
Backhaul
Base Station
In-Vehicle
& Mobile
Communications
Installation, Test
& Maintenance
Monitoring
& Control
Internet
of Things
Mobile
Device
Performance
Dear Fellow Shareowner,
Fiscal Year 2016 was a year for creating new opportunities, and responding to the challenges to achieve renewed
profitable growth. Throughout the year, TESSCO developed new opportunities created by the convergence of wireless
and the Internet, and new technologies. At the same time, we did not produce the level of financial performance we
expected as a result of the challenge in replacing the drastic purchase decline in the carrier market because of delays in
their network expansion and upgrades.
Our vison is to evolve from a wireless public carrier, transaction centric supplier, to a consultative provider that enables
network and connectivity system deployment, for private as well as public organizations. Our goal is to be Your Total Source®
for the end-to-end wireless solutions for building, using, maintaining and reselling for these systems–Base Station,
In-Vehicle & Mobile Communications, Mobile Device Performance, Wi-Fi, Coverage & Capacity, Monitoring & Control,
Backhaul, Installation, Test & Maintenance, and Internet of Things.
In the New Year, we are working to accelerate this evolution by responding to two major disruptive realities–dramatic
technology and network changes, and rapidly changing customer behaviors and expectations. Our transformations are
in these five critical areas:
• Our Offer–Expand the end-to-end product and supply chain solution offerings to support wireless systems. This
includes providing knowledge, design, innovative products and services, training and supply chain management.
• Consultative Selling–Develop consultative, relationship-based selling to deepen our relationships and expand our share
of the customers’ requirements.
• Digital Marketing & Analytics–Build our digital and Internet marketing, e-commerce and intelligence platform, to make
TESSCO.com the definitive source for knowledge, procurement and supply chain control, and using predictive analytics
to gain insight and understanding of buyer behaviors that will drive decisions and create one-to-one communications,
opportunities, sales and customer satisfaction.
• Customer Experience–Digitize the customer’s experience by simplifying and standardizing our offer, policies
and procedures at every touchpoint - from deciding on a need, to placing an order, to making a payment, to problem
resolution, giving our customers complete control over their entire procurement and supply chain.
• Talent Development–Enhance talent and leadership through recruitment, development and succession. A companywide
succession plan is underway including a new CEO search. As the 72-year-old Founder, Chairman and CEO, I will become
the Executive Chairman when a new CEO is hired, and will work with the new CEO to take TESSCO to a new level of
success in the exploding world of wireless. We expect a new CEO to be hired this fiscal year. In the meantime, I remain
the CEO, firmly dedicated to driving performance and increasing shareowner value.
We are well underway on our transformation journey; however, we must make the changes at a faster rate. While driving
the transformations, we are also focusing on market share growth, expansion in the non-carrier markets, new customer
development, offer expansion, margin improvement and expense management and making the trusted difference in our
customers’, manufacturers’ and shareowners’ success.
In summary, TESSCO is well positioned to capitalize on an industry that is revolutionizing the way we live, work and play.
All of us at TESSCO are energized and accountable to achieve the level of the success and growth of shareowner value we
all expect. I thank you, our shareowners, and our customers, manufacturers, and team members for the continued support
of TESSCO.
Sincerely,
Robert B. Barnhill, Jr.
Founder, Chairman and Chief Executive Officer
Leadership
Directors
Robert B. Barnhill, Jr.
Chairman, President and Chief Executive Officer
of TESSCO Technologies Incorporated
Jay G. Baitler
Former Executive Vice President of Staples, Inc.,
Contract Division
John D. Beletic
President and CEO of X-IO Technologies, Inc.,
an electronic storage company
Benn R. Konsynski, Ph.D.
George S. Craft Professor of Business Administration
for Information Systems and Operations Management
at the Goizueta Business School of Emory University
Dennis J. Shaughnessy
Retired Chairman of the Board of FTI Consulting Inc.
Morton F. Zifferer, Jr.
Chairman and CEO of New Standard Corporation,
a metal products manufacturer
Jerome C. Eppler
1924-2015
Director Emeritus
Jerry Eppler, a Director and friend, was
responsible for obtaining the capital in 1982
to help launch TESSCO in the very early days
of the wireless industry. Jerry served as a
Director from 1985-2007, providing guidance throughout his
term and after becoming Director Emeritus until his passing
in December 2015. We are grateful for, and will always
remember his significant contribution.
Officers
Robert B. Barnhill, Jr.
Chairman, President and Chief Executive Officer
Craig A. Oldham
Senior Vice President of Strategic Marketing
Douglas A. Rein
Senior Vice President of Performance Systems and Operations
Aric M. Spitulnik
Senior Vice President and Chief Financial Officer
Steven K. Tom
Senior Vice President of Analytics, Innovation and Learning
P. Douglas Dollenberg, Jr.
Vice President
Elizabeth S. Robinson
Vice President
Thomas F. Foster
Vice President
James R. Gaarder
Vice President
Jeffrey A. Kaufman
Vice President
Cynthia L. King
Vice President
Steven E. Lehukey
Vice President
Jeffrey K. Lime
Vice President
William A. Moten
Vice President
Marika Patto
Vice President
Nicholas J. Salatino
Vice President
Jeffrey L. Shockey
Vice President
Mary Beth Smith
Vice President
Charles Stone
Vice President
David Strauss
Vice President
Damon M. Weatherill
Vice President
Edward S. Winslow
Vice President
Shareowner Information
Annual Meeting
The Annual Meeting of Shareowners of TESSCO Technologies Incorporated is scheduled
to be held at 9:00 a.m., Tuesday, July 26, 2016 at:
TESSCO Technologies Incorporated
375 West Padonia Road
Timonium, MD 21093
Investor Relations
Analysts, investors and shareowners seeking additional information about TESSCO Technologies
Incorporated are invited to contact:
Sharon Merrill
77 Franklin Street
Boston, MA 02110
Telephone: 617.542.5300
Facsimile: 617.423.7272
Internet: www.investors.com
Aric M. Spitulnik
375 West Padonia Road
Timonium, MD 21093
Telephone: 410.229.1419
Facsimile: 410.229.1669
Email:
spitulnik@tessco.com
A copy of the Company’s Annual Report on Form 10-K as filed with the United States Securities and
Exchange Commission is available without charge on the SEC website, www.sec.gov, or upon request
to the address above.
TESSCO on NASDAQ
TESSCO’s common stock trades on the
NASDAQ Global Market under the symbol TESS.
Transfer Agent & Registrar
Wells Fargo Shareowner Services
P.O. Box 64874
Saint Paul, MN 55164
Corporate Counsel
Ballard Spahr LLP
Baltimore, MD
Independent Public
Accounting Firm
Ernst & Young LLP
Baltimore, MD
Corporate Governance
The highest ethical standards have always been integral to TESSCO’s culture and business success. Guided by the “TESSCO Way,”each
director, officer and team member is expected to observe the highest standards of ethical behavior in the performance of his or her
duties for the Company. The Company’s Code of Business Conduct and Ethics can be found in the Investors section of our website, www.tessco.com.
From a corporate governance perspective, our six member Board of Directors includes five independent directors. The four standing
committees of the Board of Directors are comprised of independent directors with the exception of Mr. Barnhill, who is a member of the
Risk and Strategy Committee. In addition, each of the four committees is chaired by an independent director. TESSCO is an Affirmative
Action-Equal Opportunity Employer M/F/D/V.
Forward-Looking Statements
This Annual Report contains a number of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of
1995, all of which are based on current expectations. These forward-looking statements may generally be identified by the use of the words
“may,” “will,” “believes,” “should,” “expects,” “anticipates,” “estimates,” “our relative bargaining power and inability to negotiate favorable terms
with our vendors and customers”; “claims against us for breach of intellectual property rights of third parties” and “product liability claims” and
similar expressions. Our future results of operations and other forward-looking statements contained in this report involve a number of risks
and uncertainties. For a variety of reasons, actual results may differ materially from those described in any such forward-looking statement.
Consequently, the reader is cautioned to consider all forward-looking statements in light of the risks to which they are subject.
We are not able to identify or control all circumstances that could occur in the future that may adversely affect our business
and operating results. In addition to risk elsewhere discussed in our Annual Report on Form 10-K for the fiscal year ended March 27,
2016, included among the risks that could lead to a materially adverse impact on our business or operating results are the termination
or non-renewal of limited duration agreements or arrangements with our vendors and affinity partners which are typically terminable
by either party upon several months or otherwise relatively short notice; loss of significant customers or relationships, including affinity
relationships; loss of customers either directly or indirectly as a result of consolidation among large wireless service carriers and others
within the wireless communications industry; the strength of our customers’, vendors’ and affinity partners’ businesses; increasingly
negative or prolonged adverse economic conditions, including those adversely affecting consumer confidence or consumer or business
spending, or otherwise adversely affecting our vendors or customers, including their access to capital or liquidity or our customers’
demand for or our ability to fund or pay for the purchase of our products and services; our dependence on a relatively small number of
suppliers and vendors, which could hamper our ability to maintain appropriate inventory levels and meet customer demand; failure of
our information technology system or distribution system; technology changes in the wireless communications industry, which could
lead to significant inventory obsolescence and/or our inability to offer key products that our customers demand; third-party freight
carrier interruption; increased competition from competitors, including manufacturers or national and regional distributors of the
products we sell and the absence of significant barriers to entry which could result in pricing and other pressures on profitability and
market share; our relative bargaining power and inability to negotiate favorable terms with our vendors and customers; our inability to
access capital and obtain or retain financing as and when needed; transitional and other risks associated with acquisitions of companies
that we may undertake in an effort to expand our business; the possibility that, for unforeseen reasons, we may be delayed in entering
into or performing, or may fail to enter into or perform, anticipated contracts or may otherwise be delayed in realizing or fail to realize
anticipated revenues or anticipated savings; our inability to protect certain intellectual property, including systems and technologies on
which we rely; claims against us for breach of the intellectual property rights of third parties; product liability claims; and our inability
to hire or retain for any reason our key professionals, management and staff.