Twin Disc of Racine, Wis., reported a 1.3 percent decline in sales and a 51 percent drop in net earnings for the 2009 fiscal first quarter, which ended Sept. 26.
The company had sales of $72.7 million in the recent quarter, compared with $73.6 million in the year-ago period. Demand in the commercial marine and megayacht markets remained high during the quarter, and the company benefited from $3.9 million in foreign currency translation.
However, that wasn’t enough to offset lower oil and gas transmission sales in the first quarter. The company also reported delayed shipments because of problems implementing its domestic ERP (enterprise resource planning) system.
Net earnings for the fiscal 2009 first quarter were $2.5 million, or 22 cents a share, compared with $5.1 million, or 44 cents a share, for the fiscal 2008 first quarter.
Twin Disc shares dipped after yesterday's earnings release, falling from just under $9 per share to close the day at $8.34 per share.
Despite the problems with the ERP system, and its negative effect on earnings, chairman and CEO Michael E. Batten said he was pleased with the overall results for the quarter given the current economic conditions.
“Our international operations performed very well and partially offset the results we experienced at our domestic operation,” Batten said in a statement. “Our Asian and European operations had strong quarters because of continued strength in the commercial marine transmission and megayacht markets.”
Batten said he is “cautiously optimistic” that fiscal 2009 will be a good year. He said Twin Disc continues to have strong orders in most of its marine markets, and industrial orders continue to show improvement.
“The recent global economic crisis has not yet had an impact on our business, as our order flows continue to be strong,” he said.