Twin Disc Q1 sales rise on defense, industrial demand

Overview

• US power transmission maker's fiscal Q1 sales rose 10.9% yr/yr, driven by defense and industrial demand

• Net income improved to $3.4 mln from a loss a year earlier

• EBITDA increased 62.6% yr/yr to $7.7 mln

Outlook

• Company expects strong growth in fiscal 2027, driven by healthy demand and record backlog

• Twin Disc sees accelerating order activity from defense customers in the U.S. and Europe

• Company plans continued investment in European expansion and manufacturing capabilities

Result Drivers

• DEFENSE AND INDUSTRIAL DEMAND - Co said sales growth was driven by defense sector orders, strength in Veth product line, and improved oil and gas demand

• DEFENSE ORDERS - Significant defense orders from Katsa and new U.S. Navy unmanned vessel program contributed to backlog growth

• INVENTORY MANAGEMENT - Disciplined inventory management helped generate positive free cash flow and reduce net debt, per CFO Jeffrey S. Knutson

Company press release:

Key Details

Analyst Coverage

• The one available analyst rating on the shares is "buy"

• The average consensus recommendation for the industrial machinery & equipment peer group is "buy"

• Wall Street's median 12-month price target for Twin Disc Inc is $30.00, about 19.8% above its November 3 closing price of $25.04

• The stock recently traded at 31 times the next 12-month earnings vs. a P/E of 33 three months ago

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)