Twin Disc Reports $1.472 Million Net Loss Despite 9.5% Increase in Net Sales

Twin Disc, Incorporated reported a net loss of $1.472 million for the quarter ended March 28, 2025, compared to a net income of $3.822 million for the same period last year. This translates to a loss of $0.11 per share, down from earnings of $0.28 per share in the prior year. The company's net sales increased by 9.5% to $81.242 million, up from $74.161 million in the previous year, driven primarily by the acquisition of Katsa Oy and the recent acquisition of Kobelt Manufacturing Co. Ltd., which contributed $7.1 million and $1.2 million, respectively, to revenue. However, the company faced challenges with weaker demand for oil and gas transmissions in China and a decline in North American commercial marine activity.

In terms of operational performance, Twin Disc's gross profit margin decreased to 26.7% from 28.2% year-over-year, attributed to a less favorable product mix and purchase accounting amortization related to the recent acquisitions. Marketing, engineering, and administrative expenses rose to $19.472 million, representing 24.0% of net sales, compared to 23.2% in the same quarter last year. The company also incurred restructuring expenses of $287,000 during the quarter, reflecting ongoing efforts to streamline operations.

The company’s balance sheet showed total assets of $332.882 million as of March 28, 2025, an increase from $312.058 million at the end of the previous fiscal year. Current assets rose to $231.968 million, driven by increases in trade accounts receivable and inventories. However, total liabilities also increased to $182.693 million, primarily due to a rise in long-term debt, which reached $37.774 million, up from $23.811 million. The company’s equity decreased to $150.189 million, down from $155.054 million, reflecting the net loss and dividends paid to shareholders.

Looking ahead, Twin Disc anticipates continued challenges in the market, particularly in the oil and gas sector, but remains optimistic about growth opportunities stemming from its recent acquisitions. The company is focused on leveraging its expanded product portfolio and global sales teams to drive future revenue growth. Additionally, Twin Disc plans to invest between $10 million and $12 million in capital assets in fiscal 2025 to enhance manufacturing capabilities and operational efficiencies. The company remains committed to monitoring market conditions and adjusting its strategies accordingly to navigate the evolving landscape.