Exhibit 99.1
Twin Disc Announces Financial Results for Fiscal 2003 Third Quarter
and Nine Months; Third-Quarter EPS of $0.18 Contrasts With Year-Ago
Loss of $0.01
RACINE, Wisc.--(BUSINESS WIRE)--April 21, 2003--Twin Disc, Inc.
(NYSE:TDI), today announced financial results for the fiscal 2003
third quarter and nine months ended March 31, 2003.
Net sales for the fiscal 2003 third quarter reached $47,177,000, a
13 percent improvement from the comparable period of 2002,
attributable in part to foreign currency translation. Net earnings for
the fiscal third quarter reached $509,000, or $0.18 per diluted share,
contrasting with the loss of $37,000, or $0.01 per share, in the third
quarter of fiscal 2002.
Fiscal 2003 quarter-over-quarter revenue comparisons were also
favorable, with third-quarter net sales up 29 percent and 11 percent,
respectively, from the current fiscal year's first and second
quarters. Reflecting increased sales volume and a favorable product
mix, gross margin for the fiscal third quarter expanded to 22.1
percent, a sharp improvement from 16.2 percent and 15.6 percent,
respectively, in the current fiscal year's first and second quarters.
Furthermore, earnings per share rebounded in the third fiscal quarter
to $0.18 from the loss of $1.72 from continuing operations in the
first two quarters of the fiscal year.
Fiscal 2003 nine-month net sales were $126,491,000 versus 2002's
$126,545,000. The reported nine-month net loss of $4,309,000, or $1.54
per share, compared with net earnings of $658,000, or $0.23 per
diluted share, for the same period a year ago.
Chairman and Chief Executive Officer Michael E. Batten, stated,
"Expectations for a return to profitability were borne out in our
fiscal third quarter. Net income rose sharply, and while year-to-date
revenues were essentially unchanged, we are pleased to have generated
sequential quarter-over-quarter improvements as the year has
progressed. Perhaps more significantly, gross profit margin has
rebounded, further reflecting our restructuring initiatives.
"On balance, demand for our products appears to be improving. We
are encouraged by signs of nascent recovery in pleasure craft marine
shipments during the quarter as well as improving order rates.
Commercial marine activity, however, remained soft as new construction
has slowed reflecting uncertainty with respect to world oil markets.
Propulsion sales are demonstrating modest gains, and our industrial
products and aftermarket parts sales, while still trailing year-ago
levels, are experiencing relative improvement from recent lows. Sales
of our 8500 Series transmissions, a high-horsepower, high-torque
application for oilfield fracturing rigs, are up, partially offsetting
softness in other sectors.
"Looking toward fiscal year-end and beyond," Batten continued, "we
are encouraged on several fronts. Marine pleasure craft order rates,
which had been affected by significantly weaker demand over most of
the last two fiscal years, now appear to have begun to show strength.
Furthermore, we expect to see continuing contributions from ongoing
cost-reduction initiatives and new-product introductions. Our new line
of QuickShift(TM) transmissions, which is a case in point, has taken
hold and we are beginning to experience strengthening market share.
Also, as announced in our April 11 press release, we expect to be
successful in being awarded a contract for providing transmissions for
TATRA-designed medium tactical trucks to be supplied to the Israeli
Defense Forces. Further developments will be announced as they unfold.
"These factors have positioned us well, and while the pace and
strength of a recovery are difficult to pinpoint precisely, we appear
to be in the initial stages of an improving scenario. We expect our
record of sequential quarterly improvements to continue in the final
quarter of the fiscal year and expect positive year-over-year
comparisons beginning the following quarter," Batten concluded.
Twin Disc, Inc., designs, manufactures and internationally
distributes heavy-duty off-highway power transmission equipment for
the construction, industrial, government, marine, agricultural, and
energy and natural resources markets.
This press release may contain statements that are forward looking
as defined by the Securities and Exchange Commission in its rules,
regulations and releases. The Company intends that such
forward-looking statements be subject to the safe harbors created
thereby. All forward-looking statements are based on current
expectations regarding important risk factors including those
identified in the Company's most recent periodic report and other
filings with the Securities and Exchange Commission. Accordingly,
actual results may differ materially from those expressed in the
forward-looking statements, and the making of such statements should
not be regarded as a representation by the Company or any other person
that the results expressed therein will be achieved.
-- Financial Results Follow--
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per-share data; unaudited)
Three Months Nine Months
Ended Ended
March 31, March 31,
2003 2002 2003 2002
------- ------- ------- -------
Net sales $47,177 $41,928 $126,491 $126,545
Cost of goods sold 36,752 32,314 103,457 98,423
------- ------- ------- -------
Gross profit 10,425 9,614 23,034 28,122
Marketing, engineering and
administrative expenses 9,041 9,238 26,331 25,784
Restructuring of operations --- --- 2,042 ---
Interest expense 350 423 983 1,355
Other (income) expense, net (133) (588) (238) (879)
------- ------- ------- -------
Earnings (loss) before income taxes
and minority interest 1,167 541 (6,084) 1,862
Income taxes 653 546 (1,779) 1,150
------- ------- ------- -------
Earnings (loss) before minority
interest 514 (5) (4,305) 712
Minority interest, net of income
taxes (5) (32) (4) (54)
------- ------- ------- -------
Net earnings (loss) $509 $(37) $(4,309) $658
------- ------- ------- -------
------- ------- ------- -------
Earnings (loss) per share:
Basic $0.18 $(0.01) $(1.54) $(0.23)
Diluted $0.18 $(0.01) $(1.54) $(0.23)
Average shares outstanding:
Basic 2,806 2,808 2,807 2,808
Diluted 2,806 2,808 2,807 2,808
Dividends per share $0.175 $0.175 $0.525 $0.525
CONTACT: Twin Disc, Inc.
Christopher J. Eperjesy, 262/638-4343