Twin Disc, Inc. (NASDAQ: TWIN), today reported financial results for the fiscal 2014 second quarter ended December 27, 2013.
Sales for the fiscal 2014 second quarter, declined to $63,212,000, from $72,325,000 for the same period last year. Year-to-date, sales were $129,638,000, compared to $141,118,000 for the fiscal 2013 first half. The decrease in sales resulted from a lower level of business in both North America and Europe. Offsetting this were higher shipments to customers in the Company’s Asian markets. Sales to customers serving the global mega yacht market remained at historical lows in the quarter, while demand remained steady for equipment used in the industrial, and airport rescue and fire fighting (ARFF) markets.
Commenting on the results, John H. Batten, President and Chief Executive Officer, said: “Unfavorable trends in the North American pressure-pumping market continue to weigh on our financial results. We anticipate this market will remain weak for the next several quarters as fracking operators have improved the efficiency of managing their fleets, which has delayed the product ordering cycle. To help insulate our business from product and geographic downturns, we have focused our efforts on improving our product and geographic diversity. Commercial marine and oil and gas sales to customers in Asia remain strong and we continue to set record sales for the region. We remain focused on business strategies that diversify sales, improve profitability, invest in our facilities and continue new product development, while conservatively managing our balance sheet.”
Gross margin for the fiscal 2014 second quarter was 29.3 percent, compared to 30.8 percent in the fiscal 2013 second quarter. The decrease in fiscal 2014 second quarter gross margin was the result of lower sales volumes and a less profitable mix of business. Year-to-date, gross margin was 30.2 percent, compared to 29.6 percent for the fiscal 2013 first half.