Twin Disc, Incorporated · NASDAQ:TWIN
Twin Disc — Q1 FY2010 Earnings Presentation
32 slides from Twin Disc's earnings presentation, Nov 9, 2009
Slide 1: Twin Disc, Incorporated
Twin Disc, Incorporated WE PUT HORSEPOWER TO WORK ™
Slide 2: Safe Harbor Statement
November 10, 2009 Twin Disc, Incorporated Safe Harbor Statement This presentation contains statements that are forward-looking within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on management’s current expectations that are based on assum
Slide 3: Twin Disc At A Glance
November 10, 2009 Twin Disc, Incorporated Manufacturing location (# of facilities in each location) Company owned distribution/service location Purchasing/sourcing offices Twin Disc At A Glance • Founded in 1918 • Headquartered in Racine, WI • ≈1,000 employees • FY09 Revenues of $296M FY08 Revenues
Slide 4: FY 2009 Financial Highlights
November 10, 2009 Twin Disc, Incorporated FY 2009 Financial Highlights • Sales were down 10.8% versus FY 2008 – 1 st Half: down less than 1% off record ’08 levels – 2 nd Half: down nearly 20% off record ’08 levels • Key Markets – Mega Yacht, Oil & Gas and Industrial markets saw significant fall off
Slide 5: Net Sales & Net Earnings (First Fiscal Quarter)
November 10, 2009 Twin Disc, Incorporated $ millions • Sales down 35% off record levels – Experienced continued softness – Seasonal and temporary plant shutdowns impacted Q1 shipments – Asian markets continued at record levels • $2.4 million loss – Reflects extended plant shutdowns in Q1 at European
Slide 6: Operating Cash Flows (First Fiscal Quarter)
November 10, 2009 Twin Disc, Incorporated $ millions 17.1% of sales -1.8% of sales • Generated $8.1 million of operating cash flow in Q1 – Continue to focus on inventory and receivables management • Debt Reduction & Cash – Revolver balance has decreased $7.2 million over the past 2 quarters – As of
Slide 7: Marine & Propulsion Systems
November 10, 2009 Twin Disc, Incorporated Marine & Propulsion Systems • Pleasure Craft market soft worldwide – However, building share of market with new technology • Work Boat market steady – Europe soft – North America moderating – Asia-Pacific growing • Patrol Boat market experiencing global grow
Slide 8: Land-Based Products
November 10, 2009 Twin Disc, Incorporated Land-Based Products • Industrial markets soft – Agriculture, irrigation, recycling and construction – No impact from ‘stimulus’ • ARFF and Military holding steady – ARFF: Continue to increase market share with ‘pump & roll’ transmissions • Oil & Gas markets
Slide 9: Corporate Profile - Geographic Diversity
November 10, 2009 Twin Disc, Incorporated 48% International Sales 61% International Sales USA Italy Rest of World Corporate Profile - Geographic Diversity
Slide 10: Managing Our Cost Structure
November 10, 2009 Twin Disc, Incorporated Global Outsourcing Lean Manufacturing $25 million Global Cost Reduction & Avoidance Program • Pension freeze • Salary & wage reductions • Temporary layoffs in US • Government-sponsored programs in Europe • ME&A cost reductions • Restructuring • Voluntary ret
Slide 11: What Differentiates Us?
November 10, 2009 Twin Disc, Incorporated What Differentiates Us? • Technology – Oil & Gas • 8500 Series • 7500 Series - new in Fiscal 2010 – ARFF • “Pump & Roll” – Military • “Legacy” Contracts • Global Distribution and Service Network • Product/Market & Geographic Diversity • Niche Market Focus •
Slide 12: Looking Ahead
Twin Disc, Incorporated Looking Ahead
Slide 13: Corporate Six Month Backlog
November 10, 2009 Twin Disc, Incorporated FY04 FY05 FY06 FY07 $ millions FY08 FY09 FY10 Corporate Six Month Backlog (Mfg Orders to be shipped in the next 6 months)
Slide 14: Fiscal Year 2010 Outlook
November 10, 2009 Twin Disc, Incorporated Fiscal Year 2010 Outlook • FY09 softness expected to continue thru 1 st half of FY10 • Mega Yacht - weakness expected to continue • ARFF & Military will remain strong • Oil & Gas - order activity is increasing • Patrol Boat market expanding • Asian market co
Slide 15: Twin Disc, Incorporated
Twin Disc, Incorporated WE PUT HORSEPOWER TO WORK ™
Slide 16: Appendices
Twin Disc, Incorporated Appendices
Slide 17: Corporate Profile - Market Diversity: Pleasure Craft
November 10, 2009 Twin Disc, Incorporated Appendix I Corporate Profile - Market Diversity Pleasure Craft Market: • Target Markets: High speed planing and displacement yachts from 50’ to 150’, diesel powered • Products: Transmissions, Surface Drives, Propellers, Steering/Thruster/Trim Systems, Water
Slide 18: Corporate Profile - Market Diversity: Work Boat
November 10, 2009 Twin Disc, Incorporated Appendix II Corporate Profile - Market Diversity Work Boat Market: • Target Markets: planing and displacement vessels from 30’ to 250’, diesel powered • Products: Transmissions, Propellers, MCD’s, Water Jets, Controls • Channels: Engine OEMs & dealers, boat
Slide 19: Corporate Profile - Market Diversity: Patrol Boat
November 10, 2009 Twin Disc, Incorporated Appendix III Corporate Profile - Market Diversity Patrol Boat Market: • Target Markets: military, patrol and coast guard vessels from 30’ to 90’, diesel powered • Products: Transmissions, Surface Drives, Propellers, Steering/Thruster/Trim Systems, Water Jets
Slide 20: QuickShift® Marine Transmissions, Propulsion & Boat Management Systems
November 10, 2009 Twin Disc, Incorporated Appendix IV QuickShift® Transmissions Electronic Controls Bow Thrusters Anchor Winches Gangways Trim Tabs, Stern Thrusters Power Steering Marine Transmissions, Propulsion & Boat Management Systems We have been very successful “bundling” more marine products
Slide 21: Corporate Profile - Market Diversity: Industrial Products
November 10, 2009 Twin Disc, Incorporated Appendix V Corporate Profile - Market Diversity Industrial Products: • Target Market: Heavy duty industrial disconnect applications • Products: Mechanical & hydraulic clutches, PTOs & pump mount drives, 100 - 2,500 HP • Channels: Distribution & OEMs • Custom
Slide 22: Corporate Profile - Market Diversity: Industrial Transmissions
November 10, 2009 Twin Disc, Incorporated Appendix VI Corporate Profile - Market Diversity Industrial Transmissions: • Target Market: Off-highway and all-terrain specialty vehicles, diesel powered • Products: Powertrain components - - 400 to 3,000 HP • Channel: OEM vehicle mfrs. • Customers: BAE, Ro
Slide 23: VII
November 10, 2009 Twin Disc, Incorporated Appendix VII $ millions % sales * See Appendix X for reconciliation of TTM figures to reported figures.
Slide 24: Non-GAAP Financial Disclosures
November 10, 2009 Twin Disc, Incorporated Appendix VIII Non-GAAP Financial Disclosures Financial information excluding the impact of certain significant items in this presentation are not measures that are defined in U.S. Generally Accepted Accounting Principles (“GAAP”). These items are measures th
Slide 25: Reconciliation of Net Earnings to EBITDA
November 10, 2009 Twin Disc, Incorporated Appendix IX * See Appendix X for reconciliation of TTM figures to reported figures. Reconciliation of Net Earnings to EBITDA
Slide 26: Reconciliation of TTM Data to Reported Quarterly Figures
November 10, 2009 Twin Disc, Incorporated Appendix X Reconciliation of TTM Data to Reported Quarterly Figures
Slide 27: Fiscal Year Condensed Consolidated Statements of Operations
November 10, 2009 Twin Disc, Incorporated Appendix XI Fiscal Year Condensed Consolidated Statements of Operations
Slide 28: Fiscal Quarter Condensed Consolidated Statements of Operations
November 10, 2009 Twin Disc, Incorporated Appendix XII 1 st Fiscal Qtr Condensed Consolidated Statements of Operations
Slide 29: Net Sales by Segment
November 10, 2009 Twin Disc, Incorporated Appendix XIII $317 $243 $219 $332 $296 Net Sales by Segment
Slide 30: Net Earnings by Segment (before Corporate Expense)
November 10, 2009 Twin Disc, Incorporated Appendix XIV Net Earnings by Segment (before Corporate Expense)
Slide 31: Operating Cash Flows - Fiscal Year
November 10, 2009 Twin Disc, Incorporated Appendix XV $ millions % sales Operating Cash Flows - Fiscal Year
Slide 32: Twin Disc, Incorporated
Twin Disc, Incorporated WE PUT HORSEPOWER TO WORK ™