Twin Disc (TWIN) investor relations material

Strategic highlights and market positioning

• Focus on power transmission technology with a 105-year history and global presence in marine and land-based markets.

• Marine propulsion now represents 60% of business, with recent acquisitions targeting this segment.

• Defense sector experiencing record backlog and pipeline, with significant growth expected in fiscal 2027 and beyond.

• Expansion into hybrid and electric marine solutions, including high-profile projects like the Maid of the Mist and Sydney Ferries.

• Industrial and land-based applications include fracking, ARFF vehicles, and recycling equipment, with steady demand.

Financial performance and outlook

• Achieved record revenue of $381 million and EBIT of $30 million, up nearly 50% year over year.

• Free cash flow reached $9.2 million for the year, with $17 million in Q4; backlog stands at $178 million.

• Oil and gas segment rebounded to 10% of business, with high margins and positive trends in e-frac and natural gas.

• Quarterly dividend increased by 25% to $0.05 per share, reflecting confidence in future growth.

• New credit agreement provides $60 million in available capacity to support growth initiatives.

Growth strategy and acquisitions

• 2030 targets set at $500 million revenue, 30% gross margin, and 60% EBITDA-to-free-cash-flow conversion.

• Continued investment in hybrid electric solutions and facility expansions, especially in Finland and Texas.

• M&A remains a priority, focusing on family-owned, high-quality regional companies that fit the global network.

• Recent acquisitions (Veth, Katsa, Kobelt) have driven significant growth, especially in marine and defense markets.

• Balance sheet positioned for another $40–$60 million acquisition; ongoing review of dividend and potential share repurchases.