Twin Disc Inc (TWIN) SEC Filing 10-Q Quarterly Report for the period ending Friday, March 26, 2021

Exhibit 99.1

NEWS RELEASE

Corporate Offices:

1328 Racine Street

Racine, WI 53403

TWIN DISC, INC. ANNOUNCES FISCAL 2021

THIRD QUARTER FINANCIAL RESULTS

●    Challenging market conditions continue due to the global COVID-19 crisis

●    Improving profitability drives strongest earnings in eight quarters

●    Generated $2.2 million of operating cash flow for the three months ended March 26, 2021

RACINE, WISCONSIN—April 30, 2021— Twin Disc, Inc. (NASDAQ: TWIN), today reported financial results for the fiscal 2021 third quarter ended March 26, 2021.

Sales for the fiscal 2021 third quarter decreased to $57.6 million, from $68.6 million for the same period last year. The 16.0% decrease in 2021 third quarter sales was primarily due to continued softness in the Company’s oil and gas markets along with weaker demand for industrial products compared to the same period the prior fiscal year. Year-to-date, sales were $152.4 million, compared to $187.5 million for the fiscal 2020 nine months. Foreign currency exchange had a $3.9 million favorable impact on fiscal 2021 third quarter sales and a $7.5 million favorable impact on fiscal 2021 year-to-date sales.

John H. Batten, Chief Executive Officer, commented: “I am encouraged by the progress we are making navigating one of the most challenging cycles in Twin Disc’s 103-year history, and we experienced a strong improvement in profitability during the quarter. Throughout the COVID-19 pandemic we have focused on realigning our cost structure, improving our balance sheet, investing in new products and technologies, and opening our Lufkin, TX facility, while supporting our customers and associates. As trends within our markets improve, we are well positioned to significantly increase sales and profitability, and I am excited by the long-term opportunities we have across our business.”

“Our six-month backlog at March 26, 2021 was $71.4 million, compared to $66.6 million at June 30, 2020, and $74.9 million at December 25, 2020. The sequential decline is partially due to the seasonal nature of our six-month backlog, along with the impacts of foreign currency exchange rates. We have seen a recent uptick in aftermarket orders across many of our global markets, which has historically been a positive leading indicator for future capital spending by our customers. In addition, we believe we are well positioned to capitalize on improving demand trends driven primarily by re-opening efforts from the pandemic, the benefits of government stimulus programs, and an improving repair and replacement cycle, including in the North American fracking industry,” concluded Mr. Batten.

Gross profit percent for the fiscal 2021 third quarter was 24.2%, compared to 24.1% in the fiscal 2020 third quarter. The Company received a $1.2 million benefit to gross profit, as a result of the employee retention credit made available under the American Rescue Plan Act. Gross profit percent, adjusted for this benefit was 22.1%. While a sequential improvement, this reflects the continuation of a less profitable mix of revenues associated with reduced new rig construction and aftermarket demand in the North American fracking market and lower overall sales resulting from the economic uncertainty brought on by the COVID-19 pandemic. Year-to-date, gross profit percent was 21.4% compared to 22.3% for the fiscal 2020 nine-month period.