Twin Disc reported net sales of $59.3 million for the first quarter of fiscal 2020, down from $74.7 million for the same period last year.
Demand remained stable across the company’s global industrial and commercial marine markets. The company said the 20.6 percent decrease in 2020 first quarter sales was primarily due to reduced demand from North American fracking customers.
Also, foreign currency exchange had a $1.5 million unfavorable impact on first quarter sales.
“Despite recent weakness in the North American oil and gas market, we continue to actively quote projects and anticipate improved market conditions in the second half of fiscal 2020,” CEO John Batten said in a statement.
“In addition, demand remains stable throughout our other global end-markets, including our Veth marine market,” Batten said. “I am confident the strategies underway to grow sales and improve our operations, including the new Texas facility, a new domestic aftermarket location, additional Veth synergies and recent product releases, will create significant long-term value in the future.”
Twin Disc acquired Veth Marine last summer.
Gross profit percent for the fiscal 2020 first quarter was 16.3 percent, compared with 32.1 percent in the first quarter of last year. Gross profit, as a percent of fiscal 2020 first quarter sales, adjusted for the product performance accrual, was 22.8 percent, which improved slightly from 22.7 percent reported for the fourth quarter of fiscal 2019.