Twin Disc Q4 2026 Earnings Call Transcript

Quartr
Provided by Quartr
August 20, 2026

Key Takeaways

  • Positive Sentiment: Twin Disc reported record fourth-quarter revenue of $114.4 million, up 18.3% year over year, while operating income rose 19.5% to $7.8 million and EBITDA increased 35.1% to $11.1 million.
  • Positive Sentiment: Defense is becoming a significant multi-year growth driver: defense represented 17% of year-end backlog, up 56% year over year, with an additional $30 million–$50 million project pipeline and capacity investments underway in Finland and the U.S.
  • Positive Sentiment: Demand remained strong across marine propulsion and land-based transmissions, including oil and gas and higher-margin e-frac applications; the six-month backlog remained nearly level at $178.3 million despite strong shipments and efforts to reduce past-due orders.
  • Negative Sentiment: Fourth-quarter gross margin fell roughly 600 basis points to 26.3%, pressured by product mix, tariffs, and the absence of a $3 million favorable inventory adjustment recorded in the prior-year quarter. Management expects margin improvement over time but continues to target 30% gross margins only by 2030.
  • Positive Sentiment: Free cash flow improved to $17.2 million, net leverage declined to 0.5, and the board approved a 25% quarterly dividend increase to $0.05 per share; fiscal 2027 capital expenditures are expected to exceed $20 million to support growth initiatives.
AI Generated. May Contain Errors.
Earnings Conference Call
Twin Disc Q4 2026
00:00 / 00:00

Transcript Sections

Skip to Participants
Operator

Welcome to the Twin Disc, Inc. Fiscal Fourth Quarter 2026 conference call. We will begin with introductory remarks from Jeff Knutson, Twin Disc CFO. Please go ahead.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Good morning, and thank you for joining us today to discuss our fiscal 2026 fourth quarter results. On the call with me today is John Batten, Twin Disc CEO. I would like to remind everyone that certain statements made during this conference call, especially statements expressing hopes, beliefs, expectations, or predictions for the future, are forward-looking statements. It is important to remember that the company's actual results could differ materially from those projected in such forward-looking statements. Information concerning factors that could cause actual results to differ materially from those in the forward-looking statements are contained in the company's annual report on Form 10-K, copies of which may be obtained by contacting either the company or the SEC.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Any forward-looking statements that are made during this call are based on assumptions as of today, and the company undertakes no obligation to publicly update or revise these statements to reflect subsequent events or new information. During today's call, management will also discuss certain non-GAAP financial measures. For a definition of non-GAAP financial measures and a reconciliation of GAAP to non-GAAP financial results, please see the earnings release issued earlier today. Now I'll turn the call over to John.

John Batten
John Batten
CEO at Twin Disc

Good morning, everyone, and welcome to our fiscal 2026 fourth quarter conference call. We closed out the fiscal year with record revenue in the fourth quarter of 2026 as we continue to build on the strong demand and order momentum that we saw throughout the fiscal year.

John Batten
John Batten
CEO at Twin Disc

Our 18% top-line growth for the quarter resulted in operating income of $7.8 million, net income of $9.4 million, $11.1 million in EBITDA, and free cash flow of $17.2 million. Defense activity is strong and continues to be a key structural growth driver for us, supported by increasing demand from customers that include the U.S. Navy and NATO. More to come on this. Oil and gas also performed well in the quarter and is trending positively as we prioritize e-frac opportunities that drive a higher margin profile. While gross margins were down in the quarter, primarily related to product mix, tariff dilution, and a prior-year favorable adjustment, we continue to pursue higher-margin opportunities like e-frac that we expect to enhance our gross margins over the long term.

John Batten
John Batten
CEO at Twin Disc

Thanks to our strong order activity in the quarter, our six-month backlog was level with the third quarter of 2026 at $178.3 million, despite strong shipments and a concerted effort to reduce past-due backlog. Both our six-month and total backlogs remain strong and are supported by a robust project pipeline and considerable sales momentum in the markets we serve. Our cash flow improved meaningfully in the quarter to $17.2 million. As a result of this strong performance and our confidence in the business going forward, our board recently approved a 25% increase in our quarterly dividend to $0.05 per share. Overall, our fourth-quarter performance capped off a strong year of operational execution for Twin Disc, and we believe that we are well-positioned with strong demand, a healthy backlog, and robust project pipeline to continue this trend into fiscal 2027.

John Batten
John Batten
CEO at Twin Disc

Before getting into our individual product groups, I'd like to provide an update on our defense-related business. As I mentioned before, defense is a key structural growth driver for our business and represents a significant long-term revenue opportunity. Our current defense customers include shipbuilders for the U.S. Navy, for which we provide transmissions to be used in unmanned autonomous U.S. Navy vessel programs, and NATO, to whom we supply driveline components through our Finnish subsidiary, Katsa, for military vehicles across an expanding NATO-wide order book. On that front, we've broken ground on our new facility in Finland to add test stand and assembly capacity and to further support expected growth in the European defense demand. With global defense becoming more of a priority given the current geopolitical environment, we believe that we're well-positioned to benefit from increased spending as defense budgets grow.

John Batten
John Batten
CEO at Twin Disc

As of year-end, defense comprises 17% of our total backlog, representing a 56% increase year over year. Sales momentum is also strong, with defense-related projects contributing $30 million-$50 million to our pipeline as of June 30th. Results have been encouraging, and looking ahead, we view defense as a reliable and durable multi-year growth driver for our business. Now let's get into our product groups. Sales in our marine propulsion systems grew 20% in the quarter when compared to the prior year period, primarily driven by strong demand for our Veth propulsion platform. Other factors contributing to revenue growth include performance of the Kobelt product line, as well as improved military demand for marine transmissions, improved commercial maritime demand in Asia, and overall strong market conditions driving increased demand across the product group. Land-based transmission sales grew 26% year over year, primarily due to improved shipment volumes in the quarter.

John Batten
John Batten
CEO at Twin Disc

Specifically, oil and gas performed well. As we continue to prioritize higher margin e-frac opportunities, we expect this segment to be a key driver of our improved margin profile. We also took meaningful steps to reduce our tariff impact in the quarter as we work to relocate our ARF assembly to Lufkin, Texas, which would help reduce tariff exposure on components sourced in India. Similar to last quarter, land-based transmission also continues to benefit from strengthening demand trends across our core geographic markets in North America and Asia, increasing global demand for energy-related products and continued progress on next-generation electrified and hybrid solutions that support long-term demand.

John Batten
John Batten
CEO at Twin Disc

Additionally, improving sentiment from North American energy customers points to additional investment in e-frac rigs, both rebuilds and new units, positioning the company well for enhanced performance. While industrial sales decreased modestly compared with the prior year, we remain encouraged by the opportunities that we are seeing as this segment continues to stabilize. The Kobelt product line provides considerable market opportunity, and our Finnish subsidiary, Katsa, is positioned to be a strong near-term growth driver thanks to increasing global military demand for defense vehicle components. We are also seeing consistent demand from North American construction and recycling markets, as well as stable underlying demand from industrial end markets. Also, we were pleased to see that Katsa has received orders in the emerging data center vertical. This opportunity represents a large part of their total backlog and is encouraged to see initial demand for our products in this fast-growing market segment.

John Batten
John Batten
CEO at Twin Disc

Our six-month backlog at the end of the fourth quarter was approximately $178.3 million, which is consistent with the backlog at the end of the third quarter of $179.5 million. We are particularly pleased with this backlog, given that during the quarter, we made solid progress on shipments and continued to make a concerted effort to reduce past-due backlog during the fourth quarter. In light of this, our backlog demonstrates the strength of our pipeline and demand across our product groups. Inventories to percentage of backlog decreased to 100% in the quarter, and we expect inventory as a percentage of backlog to continue to improve as we focus on operational execution. Looking ahead, we remain confident in our long-term strategy and are focused on driving profitable growth for our shareholders. Twin Disc is well established as a leading hybrid and electric solution provider for niche marine and land-based applications.

John Batten
John Batten
CEO at Twin Disc

Through organic growth, continued strategic acquisitions that expand our addressable market, and ongoing disciplined capital allocation across the enterprise, we believe that we are well-positioned to expand our footprint and to meet our stated 2030 full-year targets of $500 million in revenue, 30% gross margins, and greater than 60% free cash flow conversion. With that, I will turn the call over to Jeff to discuss our financial results in greater detail.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Thanks, John. Good morning, everyone. Sales in the fourth quarter of 2026 totaled $114.4 million, representing a record quarter and an 18.3% increase over the fourth quarter of fiscal 2025. Full-year sales were $381.3 million. Revenue growth in both the fourth quarter and full year was primarily driven by increased demand in our land-based transmission markets in the fourth quarter, as well as strength in marine and propulsion systems and stabilization in our industrial segment. On an organic basis, which adjusts for the impact of acquisitions and foreign currency exchange, revenue increased 15.9% in the quarter and 4.6% for the full year. Gross profit decreased slightly by 3.5% in the quarter to $30.1 million.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Gross margin decreased approximately 600 basis points to 26.3% from the prior year period, primarily related to product mix, tariff dilution, and a favorable adjustment of $3 million in the prior year fourth quarter related to one-time capitalization cost adjustments of Katsa inventory. Excluding this adjustment in Q4 of last year, the comparable gross margin would have been 28%. For the full year, gross profit was $102.6 million, or 26.9% of sales. SG&A expenses decreased 9.8% to $22.2 million compared to $24.6 million in the prior year period. As a percentage of sales, SG&A expense was 19.4% compared with 25.5% in the prior year, which continues to demonstrate our enhanced operating leverage on strength in revenue. Fiscal full-year SG&A was $84.5 million or 22.2% of sales compared to $82.4 million or 24.2% of sales in full year 2025.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Operating income in the fourth quarter of 2026 increased 19.5% to $7.8 million compared with $6.5 million in the prior year period. For the full year, operating income was $18 million, compared with $11.1 million in full year 2025. We view operating income as an especially important metric for both the fourth quarter and full year, given that our bottom line has been impacted by an income tax benefit of $2.5 million in the fourth quarter and $14 million in the full year related to the reversal of the domestic evaluation allowance. Therefore, we believe that operating income provides a more normalized snapshot of our business without the impact of income tax benefits that flow through to our net income and earnings per share.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

To that end, net income attributable to Twin Disc for the fourth quarter was $9.4 million, or $0.64 per diluted share, compared to $2.6 million, or $0.19 per diluted share, in the prior year period. The increased earnings per share was related to stronger operating income as well as approximately $0.17 per diluted share related to the income tax benefit and lower other expense when compared to the fourth quarter of 2025. Full-year net income totaled $27.1 million or $1.86 per diluted share, compared with a net loss of $697,000 or a loss of $0.05 per diluted share for fiscal 2025. EBITDA was $11.1 million in the fourth quarter, up 35.1% year-over-year, and EBITDA margin increased 120 basis points to 9.7%. Full-year EBITDA was $29.9 million.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Geographically, Europe accounted for 41% of sales in the fourth quarter of 2026, followed by North America at 29% of sales and Asia Pacific at 22% of sales. Increased sales in Europe were primarily driven by contributions from our acquisitions, including Katsa, while North American sales continued to increase related to our addition of Kobelt and improving demand for our Veth products. For the full year, Europe accounted for 42% of total sales, followed by North America at 30% and Asia-Pacific at 19%. As John mentioned, gross margins decreased to 26.2% in the fourth quarter of 2026, compared with 32.3% in the prior-year period. Gross margin contraction in the quarter was primarily related to products mix and tariff dilution, as well as the one-time $3 million favorable adjustment in Q4 of last year. Excluding the favorable adjustment, gross margin in the fourth quarter of 2025 would've been 28%.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Our margin in the quarter was also impacted by tariff dilution, which further decreased gross margin by 60 basis points. Excluding this impact, our gross margins would've been approximately 27% in the fourth quarter. We are confident about our ability to drive gross margin improvement, and our long-term strategy continues to focus on enhancing our margin profile and driving long-term profitability across our business with a stated target of 30% gross margins by 2030. We continue to monitor the situation with tariffs and are proactively working to mitigate the impacts on our business, including moving ARF assembly to Lufkin, Texas. We generated strong free cash flow of $17.2 million in the quarter. We ended the quarter with cash of approximately $16.1 million. Total debt decreased to $31.4 million, and net debt decreased to $13.8 million.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Our reduced net debt, coupled with enhanced trailing 12-month EBITDA of $29.9 million, provides us with a net leverage ratio of 0.5 as of June 30, 2026, compared with a ratio of 0.8 in the prior year. Before discussing our capital allocation framework, I wanted to provide an update on the change in our inventory accounting method that we implemented in Q4. We elected to change our method of accounting for certain inventories from the last in, first out method, or LIFO, to the first in, first out method, or FIFO. The change to the FIFO method of accounting for these inventories is preferable because it provides better matching of costs and revenues and conforms our inventory to a single method of counting as we continue to scale the business.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Additionally, the change allowed us to utilize expiring tax credits, contributing to the reversal of the valuation allowance in the second fiscal quarter. The impact of the change in inventory accounting as reported under the FIFO method was a $30 million increase in inventory for the fiscal year ended June 30, 2026, which is reflected in our quarterly and year-end results. To provide historical information on a basis consistent with the change to FIFO, we have recast certain historical information to conform to the updated method of inventory accounting. Our capital allocation framework remains consistent with our stated goals and strategy. We continue to prioritize debt reduction alongside returning capital to shareholders through both our dividend and share repurchase program. At the same time, we're committed to funding organic growth investments, including R&D, geographic expansion, and marketing to support our long-term strategy.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

When it comes to SG&A, we remain selective, evaluating both bolt-on and transformational acquisitions against clear criteria. Strategic fit, particularly opportunities that diversify our existing offerings and have the potential to serve as a platform for broader expansion. This balanced approach allows us to invest in the business while maintaining the financial flexibility to act on opportunities as they arise. I'll now turn the call back to John for his closing remarks.

John Batten
John Batten
CEO at Twin Disc

Thanks, Jeff. In closing, our record fourth quarter capped off a year of meaningful progress for Twin Disc, with continued gains in revenue, profitability, and cash flow. Demand across our core markets remained healthy throughout the year, and we ended fiscal 2026 with a strong backlog that reflects the sustained strength in marine and propulsion systems and land-based transmissions, along with the growing defense-related activity that we expect to be a durable driver of growth. Looking ahead to fiscal 2027, we remain focused on the same priorities that drove our progress this year, executing on our operational initiatives, optimizing our global footprint, and investing in the business to support long-term growth, all while maintaining a disciplined approach to capital allocation. With a strong balance sheet and robust backlog providing solid visibility, we believe Twin Disc is well-positioned to build on this year's momentum as we work toward our 2030 targets.

John Batten
John Batten
CEO at Twin Disc

Operator, please open the call for questions.

Operator

Thank you. Ladies and gentlemen, this formally begins the question-and-answer session. At this time, I would like to remind everyone, in order to ask a question, please press star followed by the number one on your telephone keypad. If you'd like to withdraw your question, press star one again. As a reminder, that is to press star one if you'd like to ask a question. Our first question comes from the line of Max Michaelis with Lake Street Capital Markets. Please go ahead.

Max Michaelis
Analyst at Lake Street Capital Markets

Hey, guys. Congrats on the quarter. A bunch of questions from me. Kind of want to start out here, just sort of a facility update. Sounds like Finland's broken ground. Anything else you guys can really provide there in terms of detail around sort of the timelines at the Finland facility? Secondly, can you kind of give us an update on sort of the capacity, how that's looking at the Racine facility?

John Batten
John Batten
CEO at Twin Disc

Sure, Max. Thanks. It's John. I'm hoping that we will be enclosed and starting to move stuff in the end of the calendar year. It's really, I would say that the impact of being fully operational is not going to be until, I would say, fiscal 2028. A lot of work to do, but it's exciting. It really does increase the output of Katsa. The way we're situated right now, we don't have a facility in Finland that was built for assembly and test. We kind of have some make-do facilities that are in other plants or other facilities that really weren't meant for this. It's going to be a big step function for them once we get in.

John Batten
John Batten
CEO at Twin Disc

We'll keep you updated. The roof. I think the walls are up; roof's going on. Obviously, we would like to be enclosed by the Finnish winter, that's for sure. I think that will definitely happen. Then in Racine, obviously we have a Finnish building that we've been in for 70 years.

John Batten
John Batten
CEO at Twin Disc

We're staffing up, adding machinists. We have had two significant capital purchases that have come in, a 1.2-meter hob and a 1.2-meter grinder. We've got more CapEx on the way, and we're trying to figure out how we can be more effective in our shift staffing and, honestly, looking at expanding our second shift and adding a third shift because there's a lot of volume coming. Of course, there's a lot of pieces moving in the puzzle. To increase the capacity in Racine, we actually have to decrease it. The tariffs gave us a good reason to relook at where we did the ARF transmission.

John Batten
John Batten
CEO at Twin Disc

It's fantastic that Lufkin's in a foreign trade zone, so we're scrambling like crazy to get that volume down to Texas so that we have more capacity for the marine transmissions for the U.S. Navy and just the commercial marine markets in general in oil and gas in Racine. A lot of moving pieces and a lot of progress has been made in the last few months, but there's a lot of work to do between now and Christmas.

Max Michaelis
Analyst at Lake Street Capital Markets

Perfect. No, great. Moving on here, let's kind of shift over to the defense side. Can you give any more details on the conversations you guys are having with some of these shipbuilders outside of Saronic and the speed that they're moving along at right now?

John Batten
John Batten
CEO at Twin Disc

Yeah. So I would say that Saronic has set the benchmark on speed to market and everything that they were doing and the announcement of Port Alpha and all of this. But there are other builders as well that are moving pretty quickly with existing yards and reconfiguring and developing relationships. That's kind of the big thing that we've seen. A lot of these shipyards, we've had decades-long relationships with them, and they've been building a certain type of vessel. Now they're partnering with different types of technology companies, forming alliances, and they're pretty fast to market, too. I can't say that Saronic certainly is getting all the headlines because they've had a lot of successes out in the field, but there are other players, too.

John Batten
John Batten
CEO at Twin Disc

It's a pretty balanced. I'd have to say that it doesn't look like the Department of Defense or the U.S. Navy is putting all their eggs in one basket. They are truly trying to bring back the shipbuilding industry in the U.S., and it's pretty exciting to see.

Max Michaelis
Analyst at Lake Street Capital Markets

I know you talked about that $50 million to $75 million pipeline. I mean, can you give us any sort of detail on where that's at now, if that's increased or anything can help?

John Batten
John Batten
CEO at Twin Disc

Yeah. Jeff, I believe it was 50% in the quarter.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Yeah. The backlog itself is up about 50%.

John Batten
John Batten
CEO at Twin Disc

In the quarter. That is a mix of. I mean, the two main buckets continue to be marine transmissions built in Racine, Wisconsin, for the U.S. Navy. We have some marine transmissions that are built in Belgium that are for the U.S. Navy and other projects. Then we have, obviously at Katsa, the number one is the trucks that Patria builds for NATO.

John Batten
John Batten
CEO at Twin Disc

They've been developing other customers in the Mideast and in Asia as well. Not sure the percentage. That's going to be a growing percentage. Then it's been exciting to see our Arneson surface drive for fast patrol boats has been getting a lot of interest. So the backlog increased 53%, and I would say the main driver of that was the projects we've already been talking about. But what's in the pipeline, it's going to cast a much wider net that we'll see in the quarters coming on different products.

Max Michaelis
Analyst at Lake Street Capital Markets

Okay

John Batten
John Batten
CEO at Twin Disc

For different customers.

Max Michaelis
Analyst at Lake Street Capital Markets

The defense side of the backlog grew 53% in the quarter, correct?

John Batten
John Batten
CEO at Twin Disc

Yes.

Max Michaelis
Analyst at Lake Street Capital Markets

That is what you are saying? Okay, great.

John Batten
John Batten
CEO at Twin Disc

Yeah.

Max Michaelis
Analyst at Lake Street Capital Markets

Last one from me, and I will hang up. Can you sort of give us an idea of the pipeline of new defense programs? I know we talked about kind of the shipbuilders and then Katsa. Is there anything else kind of that you guys are eyeing for fiscal year 2027 that could make a big splash?

John Batten
John Batten
CEO at Twin Disc

I would say the biggest ones, and we're under NDAs, but the biggest ones are going to be fast patrol boats with Arneson and Rolla propellers. It will be similar product that is going into the Patria trucks, but different for different truck builders and different militaries in the Mideast and Asia. In the U.S., I think you'll see continuation on with BAE on the M88, the HERCULES, the tank retriever. Those would be the big ones. Then there's some smaller ones, but those are the I think the ones that are going to be exciting and meaningful are the ones that I just mentioned.

Max Michaelis
Analyst at Lake Street Capital Markets

Awesome. Thanks, guys, and congrats on the quarter.

John Batten
John Batten
CEO at Twin Disc

Thank you very much.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Thank you.

Operator

As a reminder, if you would like to ask a question, please press star followed by the number one on your telephone keypad. Our next question comes from the line of Simon Wong with Gabelli Funds. Gabelli Funds, please go ahead.

Simon Wong
Analyst at Gabelli Funds

Morning, John and Jeff.

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Hey, Simon.

John Batten
John Batten
CEO at Twin Disc

Hey, Simon.

Simon Wong
Analyst at Gabelli Funds

Hey. Just on the oil and gas part of your business, how big is that now? How much revenue did you do there this quarter, and how did it compare to last year?

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Yeah. It's ramping up, Simon. It was, in terms of percentage of revenue, it's the biggest since fiscal 2024 and in terms of pure dollars, because obviously everything else grew as well. In terms of pure dollars, the biggest since Q4 fiscal 2024. It's more than, say, double the average of what we did the first three quarters, so it definitely ramped up at the end of the year. It was about 10%, little over 10% of overall revenue in the quarter.

Simon Wong
Analyst at Gabelli Funds

Great. You've referenced in your presentation, in your press release about higher opportunities, there's a higher margin e-frac opportunities. Did you sell any units in the quarter for e-fracs?

John Batten
John Batten
CEO at Twin Disc

Yes. Simon, the answer is yes. I can't give you an exact number because some of them might have been in the first quarter of the or sorry, the third quarter, first calendar quarter. But we have; there's probably two spreads that have been delivered and more coming.

Simon Wong
Analyst at Gabelli Funds

Okay, great. Looks like you're gaining traction there. That's good news.

John Batten
John Batten
CEO at Twin Disc

Yeah.

Simon Wong
Analyst at Gabelli Funds

Just, I know you talked about the military pipeline, the $50 million to $60 million or $50 million, $60 million, $70 million pipeline of opportunity. How do you see that? How much of that do you think you can win in orders?

John Batten
John Batten
CEO at Twin Disc

Oh, of that? We're pretty conservative when we put it in the pipeline. We think that we have a better than 50/50 shot of winning those. It's just

Simon Wong
Analyst at Gabelli Funds

Win them all.

John Batten
John Batten
CEO at Twin Disc

Yeah, Simon, with the military, I would say we're very good at predicting our confidence of winning. It's just when the project starts that we. They typically, these projects take longer, so to materialize when they're going to order, but we're pretty confident on winning them. It's just, I don't want to give you, like, it's going to happen next quarter in six months because I'll jinx it, and then it'll be nine months or 12 months.

Simon Wong
Analyst at Gabelli Funds

Okay. That's fair. For my reference, how big was the military business in the fourth quarter or in FY 2026?

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

Yeah. We don't have a great number to give you there. It was definitely up. It's something that we'll do a better job of tracking and reporting. It's just so fragmented because it's across all of our products and all of our regions, and a lot of it going through distribution. So we need to do a better job analytically of pulling that together as it becomes a bigger and bigger part of the business.

Simon Wong
Analyst at Gabelli Funds

Okay. One more from me. You talked about facility additions. What is your CapEx for 2027?

Jeff Knutson
Jeff Knutson
CFO at Twin Disc

The number that we put out, or will put out, is going to be north of $20 million. It is obviously with the new facility going up in Finland, that is a big investment. Movement of a significant product line down to Lufkin and some of the machine tools that John just referenced—a lot more behind that. There is a good level of investment going in to fund the growth that we see. As we start this fiscal year, we are in great shape with a new credit agreement and plenty of financial horsepower to deliver that. Yeah, it is an exciting time for us.

Simon Wong
Analyst at Gabelli Funds

Okay, great. Thank you, guys.

Operator

Thank you. At this time, we have no further questions. I would like to turn the call back over to the management for closing remarks.

John Batten
John Batten
CEO at Twin Disc

Thank you for your continued interest in Twin Disc, and we hope that we have answered all of your questions. If not, please feel free to reach out to either Jeff or myself, and we will try to answer those questions for you as soon as possible. Have a great rest of your day, and we look forward to talking to you after our fiscal 2027 first quarter results.

Operator

This concludes today's conference call. You may now disconnect. Have a great day.

Executives
    • Jeff Knutson
      Jeff Knutson
      CFO
    • John Batten
      John Batten
      CEO
Analysts
    • Max Michaelis
      Analyst at Lake Street Capital Markets
    • Simon Wong
      Analyst at Gabelli Funds
Powered by Quartr