Marine markets remained stable despite oil and gas slowdown.
Veth Propulsion, which Twin Disc acquired last year, has provided strong growth.
James Feiertag will oversee operations, sales, marketing, distribution and engineering.
The project triples the capacity of its Sturtevant, Wis., location.
It will also serve as a global distribution center.
The 38 percent increase was largely due to its acquisition of Veth Propulsion last year.