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Shares of Twin Disc, Incorporated TWIN have gained 6.2% since the company reported its fiscal third quarter results, notably outperforming the broader market. Over the same time frame, the S&P 500 index rose by 0.6%. In the past month, TWIN has advanced 5.1%, modestly exceeding the S&P 500’s 4.3% growth, suggesting positive investor sentiment following the earnings release.
Twin Disc incurred a net loss of 11 cents per share in the fiscal third quarter against a net income of 27 cents per share. (See the Zacks Earnings Calendar to stay ahead of market-making news.)
The company posted a 9.5% year-over-year increase in net sales, reaching $81.2 million for the quarter ended March 28, 2025, compared to $74.2 million in the prior-year period. The uptick was driven by strength in the Marine and Propulsion Systems and Industrial segments, as well as contributions from recent acquisitions, Katsa Oy and Kobelt. However, organic sales — excluding acquisitions and currency effects — rose just 1.7%.
Despite revenue growth, profitability declined sharply. The company incurred a net loss of $1.5 million against a net income of $3.8 million a year ago. EBITDA also fell 42.7% to $4 million from $7 million. The downturn was attributed to a mix of lower operating income, foreign currency losses, and higher pension-related amortization.
Twin Disc, Incorporated Price, Consensus and EPS Surprise
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Twin Disc’s gross profit rose modestly to $21.7 million from $20.9 million. However, gross margin slipped by approximately 150 basis points to 26.7%, primarily due to an unfavorable product mix, specifically, reduced shipments of oil and gas transmissions to China. Operating income dropped to $2 million from $3.6 million in the year-ago quarter, pressured by increased marketing, engineering, and administrative (ME&A) expenses, which rose 13.2% year over year to $19.4 million.
Regional sales trends revealed that Europe captured a larger share of revenue, aided by the Katsa acquisition, while North America benefited from robust demand in the Marine and Propulsion segment. Industrial sales surged 56.2% to $9.7 million, while Land-Based Transmissions declined 6.9% to $17.8 million.
The six-month order backlog expanded to $133.7 million, up from $124 million at the end of the fiscal second quarter. This backlog, which management considers a key indicator of near-term revenue visibility, reflects stable demand across product categories, despite FX-related gains of $2.6 million.