TWIN DISC, INC Investor Presentation DISCLOSURES Safe Harbor Statement This presentation contains statements that are forward-looking within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on management's current expectations that are based on assumptions that are subject to risks and uncertainties. Actual results may vary because of variations between these assumptions and actual performance. Investors are referred to Twin Disc's fiscal year 2024 An ...

Financial Performance - Net sales for the second quarter increased 23.2%, or $16.9 million, to $89.9 million compared to $73.0 million in the same quarter last year[89] - For the first half of fiscal 2025, net sales increased 19.2%, or $26.3 million, to $162.8 million from $136.5 million in the same period a year ago[96] - The European region saw a significant revenue increase of $19.5 million or 41.6% due to the acquisition of Katsa[96] Expenses and Profitability - Gross profit as a percentage of sales for the second quarter declined to 24.1%, down from 28.3% in the same period last year, primarily due to a non-cash inventory write-down of $1.6 million[92] - Marketing, engineering, and administrative expenses increased by $1.7 million (9.9%) over the same period last fiscal year, with ME&A expenses as a percentage of sales at 21.0% compared to 23.6% last year[93] - Interest expense increased by $0.1 million to $0.5 million in the second quarter due to a higher average outstanding revolver balance following the Katsa acquisition[94] - The effective tax rate for the fiscal 2025 second quarter was 58.5%, down from 64.0% in the prior fiscal year[95] Cash Flow and Liquidity - Cash decreased by $4.2 million to $15.9 million as of December 27, 2024, compared to $20.1 million as of June 30, 2024[105] - The Company remains in compliance with its liquidity and other covenants, with available cash and credit expected to meet future capital requirements[118] Assets and Liabilities - Trade receivables decreased by $1.5 million, or 2.8%, compared to last fiscal year-end, with trade receivables as a percentage of sales at 59.7% in the second quarter[106] - Inventories decreased by $2.2 million, or 1.7%, to $128.3 million, with a backlog of orders approximating $124.0 million, down from $133.7 million at June 30, 2024[107] - Accounts payable decreased by $4.0 million, or 12.3%, to $28.6 million, primarily due to inventory reduction during the second quarter[109] - Total borrowings and long-term debt decreased by $0.9 million to $24.9 million, with a net debt of $9.0 million, compared to $5.7 million at June 30, 2024[110] - Total equity decreased by $7.4 million, or 4.8%, to $147.6 million, impacted by a net loss of $1.7 million and dividends paid of $1.1 million[111] Capital Expenditures and Investments - Net property, plant and equipment increased by $0.4 million (0.7%) to $58.5 million, with capital spending of $5.1 million in the first half and an expected total investment of $12 to $15 million in fiscal 2025[108] - The Company is focused on modernizing manufacturing processes and improving efficiencies globally as part of its capital program[108] Debt and Financial Stability - The Credit Agreement allows for a Term Loan of up to $20.0 million and Revolving Loans of up to $45.0 million, with a maturity date extended to April 1, 2027[112] - The Company’s Total Funded Debt to EBITDA ratio may not exceed 3.50 to 1.00, ensuring financial stability[114] - The Company expects to contribute $0.5 million to postretirement benefits and defined benefit pension plans in fiscal 2025[119]

Sales Performance - Sales for the fiscal 2025 second quarter increased 23.2% year-over-year to $89.9 million, driven by a $10.0 million incremental benefit from Katsa Oy[5] - Organic sales increased 10.1%, attributed to strength in the Marine and Propulsion Systems and Industrial product segments[5] - Organic net sales for the quarter were $79,579,000, up from $72,243,000 in the same quarter of 2023, indicating a growth of approximately 10.5%[26] Profitability - Gross profit increased 5.0% to $21.7 million, while gross margin decreased approximately 420 basis points to 24.1% due to inventory write-downs and unfavorable product mix[7] - EBITDA increased 13.5% year-over-year to $6.3 million, reflecting solid operational performance[10] - EBITDA for the quarter was $6,262,000, compared to $5,519,000 in the prior year, representing an increase of about 13.5%[22] - The company reported a net loss of $1,673,000 for the quarter, compared to a net loss of $148,000 in the same quarter of 2023[30] Expenses and Liabilities - Marketing, engineering and administrative expenses increased by 9.9% to $18.9 million, primarily due to the addition of Katsa[8] - Depreciation and amortization expenses increased to $6,534,000 from $5,023,000, reflecting a rise of about 30%[30] - Current liabilities increased to $102,658,000 from $99,516,000, showing a growth of approximately 2.2%[28] Cash Flow and Debt - Cash decreased 24.3% to $15.9 million, while total debt increased 40.5% to $24.9 million, primarily due to the Katsa acquisition[11] - Total debt increased to $24,873,000 as of December 27, 2024, from $17,698,000 in the prior year, while net debt rose to $8,967,000 from a net cash position of $(3,323,000)[24] - Cash and cash equivalents decreased to $15,906,000 from $21,021,000 year-over-year, indicating a decline of approximately 24.5%[28] Order Backlog and Market Outlook - The backlog of orders to be shipped over the next six months is approximately $124.0 million, supported by strong ongoing order activity[11] - The industrial segment has started to recover, with improving order rates through the quarter[3] - The company aims to enhance its business and explore additional growth opportunities while focusing on hybrid and electric solutions[4] Dividends and Assets - The company paid dividends of $1,136,000 during the quarter, compared to $560,000 in the same quarter of the previous year, marking an increase of 102.9%[30] - Total assets decreased to $307,360,000 from $312,058,000, reflecting a decline of about 1.5%[28] Net Income - Net income attributable to Twin Disc was $0.9 million, or $0.07 per diluted share, consistent with the prior year[10] - Net income attributable to Twin Disc for the quarter ended December 27, 2024, was $919,000, compared to $930,000 for the same period in 2023, reflecting a slight decrease[22]

Core Insights - Twin Disc, Inc. reported a strong fiscal second quarter 2025 with a 23.2% year-over-year increase in sales to $89.9 million, driven by the acquisition of Katsa Oy and strong demand in the marine and industrial segments [4][7] - The company is focusing on strategic priorities and operational efficiencies to enhance its business and capitalize on growth opportunities in hybrid and electric solutions [3][10] Financial Performance - Sales increased by 23.2% year-over-year to $89.9 million, with organic sales growth of 10.1% [4][7] - Gross profit rose 5.0% to $21.7 million, but gross margin decreased by approximately 420 basis points to 24.1% due to inventory write-downs and unfavorable product mix [5] - Net income attributable to Twin Disc was $0.9 million, consistent with the previous year, while EBITDA increased 13.5% to $6.3 million [8][7] Product Segment Performance - Marine and Propulsion Systems sales increased by 23.9% to $56.7 million, while Industrial segment sales surged by 44.8% to $9.5 million [4] - The Land-Based Transmissions segment also saw a 19.8% increase in sales [4] Geographic Sales Distribution - The company experienced double-digit growth in both European and North American regions, with a shift in sales distribution favoring Europe and a decline in the Asian Pacific region [4] Operational Metrics - The backlog of orders to be shipped over the next six months is approximately $124.0 million, supported by strong ongoing order activity [9] - Cash decreased by 24.3% to $15.9 million, while total debt increased by 40.5% to $24.9 million, primarily due to the Katsa acquisition [9] Management Commentary - The CEO highlighted the stable marine market and the recovery in the industrial segment, while also acknowledging ongoing challenges in the Asian oil and gas markets [2][3] - The CFO noted near-term pressure on margins due to product mix and charges associated with the Katsa acquisition, but expressed confidence in the company's financial position and operational priorities [10]

Core Viewpoint - Twin Disc, Inc. is set to release its fiscal 2025 second-quarter results on February 5, 2025, followed by a conference call to discuss the results with the investment community [1]. Company Overview - Twin Disc, Inc. designs, manufactures, and sells marine and heavy-duty off-highway power transmission equipment, including marine transmissions, azimuth drives, surface drives, propellers, and boat management systems [3]. - The company also offers power-shift transmissions, hydraulic torque converters, power take-offs, industrial clutches, and control systems [3]. - Twin Disc primarily serves customers in the pleasure craft, commercial and military marine markets, as well as in the energy and natural resources, government, and industrial markets [3]. - Sales are conducted through a direct sales force and a distributor network, catering to both domestic and foreign customers [3].

Financial Data and Key Metrics Changes - The company reported sales of $72.9 million for Q1 2025, an increase of $9.3 million or 14.7% from the prior year, driven by the Katsa acquisition and healthy demand in global end markets [23] - Net loss attributable to the company was $2.8 million or $0.20 per diluted share, compared to a net loss of $1.2 million or $0.09 per diluted share in Q1 2024 [24] - Gross profit margin increased to 26.5% from 26.2% in the prior year, with gross profit rising 16.1% to $19.3 million [25] - EBITDA was $1.7 million in Q1 2025, down 23% compared to the same quarter in fiscal 2024 [28] Business Line Data and Key Metrics Changes - Marine and Propulsion segment sales grew 22.9% year-over-year, driven by strong demand and the Katsa acquisition [11] - Industrial segment sales increased 61.3% year-over-year, primarily due to the addition of Katsa and stabilization of end market demand [18] - Land-based transmission business saw a 7% decline in sales, mainly due to softness in the Asia Pacific region [15] Market Data and Key Metrics Changes - Sales in Europe increased due to the Katsa acquisition, with continued growth in sales from Middle Eastern markets [27] - The luxury yacht market backlog grew sequentially by 19% in the quarter, with incoming orders for Veth products reaching an all-time high [12] Company Strategy and Development Direction - The company aims to become a leading provider of hybrid electrification solutions, focusing on controls and systems integration to drive sustainable growth [21][22] - The strategic focus includes expanding offerings in hybrid and electrification space, with active projects on fully electric and hybrid applications [21] Management's Comments on Operating Environment and Future Outlook - Management noted that end market demand in the industrial business is stabilizing, and they expect to continue gaining share despite challenges in construction and agricultural markets [19] - The company is optimistic about capturing growth opportunities in the hybrid and electrification sectors, supported by heightened government defense spending [14] Other Important Information - The company’s backlog reached historical levels, with a six-month backlog growing both sequentially and year-over-year [20] - Net debt increased to $13.1 million, primarily due to the Katsa acquisition [27] Q&A Session Summary Question: What is the outlook for free cash flow given the sizable negative generation this quarter? - Management expects to return to generally positive free cash flow levels for the rest of the year, targeting around 60% of EBITDA [35] Question: Any update on the EFAC offering introduced a few quarters ago? - The prototype is still available, but there have been no purchases yet; customer focus is currently on traditional rigs [36] Question: How much did the oil and gas business contribute to this quarter? - Oil and gas represented about 10% of revenue for the quarter, down from 15% in the previous year [37]

Twin Disc, Inc. (TWIN) incurred a net loss per share of 20 cents for the first quarter of fiscal 2025, wider than the loss of 9 cents per share recorded in the prior-year quarter.Revenues rose 14.7% year over year to $72.9 million, up from $63.6 million in the first quarter of fiscal 2024. The increase in sales was primarily driven by the acquisition of Katsa Oy and strong performance in the company’s Marine and Propulsion Systems and Industrial segments.Despite a broader increase in sales, the overall fina ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Form 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended September 27, 2024 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 1-7635 TWIN DISC, INCORPORATED (Exact name of registrant as specified in its charter) Wisconsin 39-0667110 (State or other jurisdiction of (I.R.S. Employer Incorporation or organization ...

Exhibit 99.1 Twin Disc Announces First Quarter Results MILWAUKEE, Wis., November 6, 2024 (GLOBE NEWSWIRE) -- Twin Disc, Inc. (NASDAQ: TWIN) today reported results for the first quarter ended September 27, 2024. Fiscal First Quarter 2025 Highlights ● Sales increased 14.7% year-over-year to $72.9 million ● Gross margin of 26.5%, expanded 30 basis points over prior year ● Net loss attributable to Twin Disc was ($2.8) million and EBITDA* of $1.7 million, accounting for a ($1.1) million currency loss ● Robust si ...

MILWAUKEE, Oct. 22, 2024 (GLOBE NEWSWIRE) -- Twin Disc, Inc. (NASDAQ: TWIN), today announced that it will release its fiscal 2025 first-quarter results at approximately 8:00 am Eastern on November 6, 2024, and host a webcast and conference call to discuss those results at 9:00 am Eastern. Following their prepared remarks, the Company will host a question-and-answer session with the investment community. The live audio webcast will be available on Twin Disc’s website at https://ir.twindisc.com. To participat ...