Yahoo Finance Twin Disc Inc (TWIN) Q3 2024 Earnings Call Transcript Highlights: Steady Growth Amidst ...
Sales: $74.2 million, up 0.5% year-over-year.
Net Income: $3.8 million, or $0.27 per diluted share.
Gross Profit Margin: Increased to 28.2% from 26.1% year-over-year.
Marine and Propulsion Systems Sales: Grew 3% year-over-year.
Land-Based Transmission Sales: Decreased 3% year-over-year.
Industrial Sales: Declined 15% year-over-year.
Debt Reduction: Reduced by $24.1 million to negative $6.8 million.
Cash Balance: Ended the quarter at $23.8 million, up $9.8 million year-over-year.
EBITDA: Remained strong at $7 million.
Leverage Ratio: Decreased to negative 0.3 times.
Release Date: April 30, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: How much of this quarter's revenue is derived from oil and gas customers, and can you break that down between new equipment and consumables? A: (Jeffrey Knutson - CFO, VP - Finance, Treasurer, Secretary) Approximately 10% to 15% of the revenue for the quarter came from oil and gas, split fairly evenly between consumables and units.
Q: What is the company seeing in terms of North American frac customers? A: (John Batten - President, CEO, Director) There's been an uptick in new spare part orders and some limited unit sales. The outlook suggests increased activity through the rest of the calendar year, influenced by geopolitical events.
Q: How should we think about inventory as a percentage of backlog for fiscal year 4Q '24? A: (Jeffrey Knutson - CFO, VP - Finance, Treasurer, Secretary) Inventory as a percentage of backlog is expected to continue decreasing, following the trajectory seen in the last two quarters.
Q: Any update on the timing of closing of the Katsa acquisition? Does the acquisition need approval from Finland's Economic Minister to close? A: (John Batten - President, CEO, Director) The acquisition has received necessary approvals and is expected to close within 30 to 40 days.
Q: Thoughts on the industrial segment and its recent performance? A: (John Batten - President, CEO, Director) The past quarter has shown the best order quarter in a few quarters, with a broad-based pickup, particularly in the lower horsepower range across Europe, the US, and Australia.
Q: Can you provide perspective on the margin profile of Katsa and the new markets or customers it might bring? A: (John Batten - President, CEO, Director) Katsa's margin profile aligns with Twin Disc's, fluctuating from high 20s to low 30s. Katsa will be a key supplier for Twin Disc across various global locations, and its integration is expected to open up new markets, particularly in Europe.
Q: Could you frame the opportunity for Twin Disc in hybrid and electrification markets? A: (John Batten - President, CEO, Director) The shift to hybrid and electrification represents a significant opportunity, with potential for a 4-8 times increase in content per application. This transition is particularly relevant in off-highway applications like marine and construction.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
