Slide 1: Twin Disc, Inc Investor Presentation
TWIN DISC, INC Investor Presentation
Slide 2: Disclosures
DISCLOSURES 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 assumptions that are subject to ris
Slide 3: Investment Highlights
INVESTMENT HIGHLIGHTS A leader in global power transmission technology with an increasingly diversified IP-protected portfolio Well-positioned to benefit from tailwinds in defense markets and hybrid transmissions supported by robust backlog Margin enhancement and operational initiatives driving favo
Slide 4: Third Quarter Highlights
THIRD QUARTER HIGHLIGHTS Strategic Financial Sales growth driven by marine & propulsion strength, Q3 sales +19.0% vs. YA to $96.7 million Veth demand, and contributions from acquisitions and FX Organic sales +7.0% vs. YA Margin expansion supported by higher volumes and ongoing improvement in
Slide 5: Capturing Robust Defense Market Demand with Runway for Growth
CAPTURING ROBUST DEFENSE MARKET DEMAND WITH RUNWAY FOR GROWTH Robust TWIN Delivering Defense Activity Well Positioned Results Select Defense Products Defense as a +13% ~15% percentage of Total Backlog YoY Increase in 2026 US Defense Spending (1) Marine Transmissions, Transmissions, Propulsions Contr
Slide 6: Marine & Propulsion Systems
MARINE & PROPULSION SYSTEMS Sales up 20.0% vs. YA Performance driven by continued demand for Veth products Improved sequential aftermarket execution Healthy demand across workboat, government, and specialty marine applications Sustained interest in higher-content propulsion solutions and i
Slide 7: Land-Based Transmissions
LAND-BASED TRANSMISSIONS Sales increased by 22.2% vs. YA, primarily driven by improved shipment volumes Customer caution persists in North America, with rebuilds and refurbishments outpacing new equipment purchases Order improvements across Latin America, North America, and China, signaling st
Slide 8: Industrial
INDUSTRIAL Sales increased by 15.2% vs. YA, due in part to the acquisition of Kobelt Kobelt acquisition counted as inorganic sales for approximately half of our fiscal third quarter Stable underlying demand across industrial end markets Continued focus on higher-content solutions and leverag
Slide 9: Continued Backlog Growth
CONTINUED BACKLOG GROWTH BACKLOG AND INVENTORY % OF BACKLOG $179.5 $180.0 $175.3 $163.3 $160.0 190.0% Healthy 6-month backlog higher $150.5 170.0% sequentially and on a year-over-year $140.0 $133.7 basis $120.0 150.0% Growth in backlog led by broad- $100.0 130.0% based demand across core $80.0 m
Slide 10: Long-Term Strategy and 2030 FY Targets
LONG-TERM STRATEGY Leading Hybrid/Electric solution provider for niche marine and land-based applications 2030 FY Targets Continued expansion of acquisitions to reach new markets and geographies $500M Revenue Rationalize global footprint for efficiency and customer response 30% Gross Margins Increas
Slide 11: Financial Overview
FINANCIAL OVERVIEW aS |
Slide 12: Financial Performance
FINANCIAL PERFORMANCE SALES ($ in millions) $96.7 Continued healthy demand across $81.2 global markets Contribution from acquisitions and operational execution driving performance and sales growth 3QF25 3QF26 EARNINGS PER SHARE $0.23 EPS improvement attributable to higher operating income from
Slide 13: Sales Diversity
SALES DIVERSITY SALES BY PRODUCT GROUP ($ in millions) $4.6 Sales growth driven by strength and $4.4 $11.2 contributions from acquisitions: $9.7 $21.7 $17.8 Consistent demand across core marine and propulsion end $49.3 $59.1 markets, particularly Veth products Incremental revenue contribution 3Q
Slide 14: Strong Balance Sheet
STRONG BALANCE SHEET BALANCE SHEET ($ in millions) $45.1 $40.8 $29.0 $24.5 NET LEVERAGE RATIO $16.2 $16.1 1.0x 1.1x Total Debt Cash Net Debt 3QF25 3QF26 LTM EBITDA ($ in millions) 3QF25 3QF26 $25.8 $23.8 Increase primarily due to acquisition of Kobelt 3QF25 3QF26 14
Slide 15: Margins & Near-Term Expectations
MARGINS & NEAR-TERM EXPECTATIONS THIRD QUARTER GROSS MARGIN DRIVERS THIRD QUARTER TWIN DISC GROSS MARGIN Gross margin increased by ~134 basis points vs. YA, driven by higher volumes, and improved operational execution 28.1% Benefits of successful margin improvement initiatives and operating 26.7
Slide 16: Capital Allocation Framework
CAPITAL ALLOCATION FRAMEWORK Debt Reduction Research & Development Focus Areas Geographic diversification / expansion Marketing Return Capital to Shareholders (Dividends) Diversification away from Oil & Gas Strategic Fit Acquisition logic immediately evident Organic Growth Clear value cr
Slide 17: Key Takeaways
KEY TAKEAWAYS Delivered a solid quarter with strong revenue growth, significant margin expansion, and improved free cash flow generation, reflecting improved execution and healthy demand Demand environment remains constructive, with backlog increasing sequentially and providing strong visibility
Slide 18: Q&A Fiscal 2026 Third Quarter Earnings Call
Q&A Fiscal 2026 Third Quarter Earnings Call 18
Slide 19: Appendix
APPENDIX a>.
Slide 20: Reconciliation of Reported Net Sales to Organic Net Sales
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO REPORTED FINANCIAL MEASURES RECONCILIATION OF REPORTED NET SALES TO ORGANIC NET SALES (In thousands; unaudited) 3Q26 3Q25 Net Sales $96,694 $81,242 Less: Acquisition(1) 2,248 - Less: Foreign Currency Impact 7,518 - Organic Net Sales $86,928 $81,242 (1
Slide 21: Reconciliation of Total Debt to Net Debt to EBITDA
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO REPORTED FINANCIAL MEASURES RECONCILIATION OF TOTAL DEBT TO NET DEBT TO EBITDA LEVERAGE RATIO CALCULATION (In thousands; unaudited) March 27, 2026 March 28, 2025 Current maturities of long-term debt $3,000 $2,000 Long-term debt 42,068 38,774 Total deb
Slide 22: Reconciliation of Consolidated Net Income to EBITDA
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO REPORTED FINANCIAL MEASURES RECONCILIATION OF CONSOLIDATED NET INCOME TO EBITDA (In thousands; unaudited) 3Q26 2Q26 1Q26 FY25 4Q25 3QF25 Net Income (loss) attributable to Twin $3,325 $22,371 ($518) ($1,894) $1,424 ($1,472) Disc Interest expense 790 77
Slide 23: Reconciliation of Operating Cash Flow to Free Cash Flow
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO REPORTED FINANCIAL MEASURES RECONCILIATION OF NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES TO FREE CASH FLOW (In thousands; unaudited) For the Quarter Ended March 27, 2026 March 28, 2025 Net cash provided (used) by operating activities $5,307 $3,2