News Release from Titan
International, Inc. July 28, 2010
Titan International Inc. Announces
Increase in Sales for Second Quarter
Second quarter
summary:
Sales for second quarter 2010 were $229.7
million, an increase of $22.7 million or 11 percent, as compared to
$207.0
million in the second quarter of 2009.
Gross profit was $33.9 million for the
second quarter of 2010, a 14 percent increase when compared to $29.7
million in
the second quarter of last year.
Second quarter income from operations was
$17.4 million, an increase of 35 percent as compared to $12.9 million in
2009.
The second quarter of 2010 includes a
$2.7 million charge for the $47.4 million Titan senior note repurchase.
Net income for the second quarter was
$4.6 million, compared to $5.9 million in the second quarter of 2009.
Statement of Chief
Executive Officer:
"The second quarter was a good quarter for a number
of reasons, but first I want to give credit to the management team and
all
Titan employees for their effort, talent and prompt action to make this
happen," said Chairman and CEO Maurice M. Taylor Jr. "The numbers speak
for
themselves. If you look at the cash flow you will see that there is
about an
extra $1 million each quarter in depreciation and amortization related
to the
new off-the-road (OTR) equipment when compared to the same quarters in
2009.
"Large farm is running good and we believe it will
go on for a few more years because corn, soybeans, cotton and wheat all
use big
equipment. Brazil is a big competitor in corn, soybeans and cotton, but
if you
look at today's prices this is a very profitable business for the
American
farmer. Remember, a few years ago the Brazilian Real conversion rate to
U.S.
Dollars was 4 to 1. Today it is 1.8 to 1; therefore, it's a great time
for the
American farmer and they will buy equipment. John Deere will be a big
winner.
Mid-size and small farm equipment should stay about the same this year
and
next, we believe.
"In construction and mining equipment, orders are
growing. Original equipment manufacturer business is up because of
inventory
build, and the aftermarket is buying Titan's new radial tires in 49- and
51-inch sizes. These new sizes for Titan are part of our second
generation
super giant tire line, which includes 57- and 63-inch sizes. Testing of
our
second generation 63-inch tires is still ongoing. There are no heating
or wear
issues on the second generation tires that were previously identified on
long
hauls with the first generation tires. To accomplish this, Titan removed
1,500
lbs. of weight per tire and used different compounds and a new tread
design to
allow more cooling. We expect this portion of our business to continue
to grow
as we move forward.
"During the quarter, Titan introduced new tires and
wheels for farm, underground mining and large open pit mining
applications. In
the third quarter, Titan will introduce new radial loader tires.
"The third quarter is starting out stronger than in
2009, and I believe the goals we set last December will be met on the
mid to
high side if business keeps going as it is today. There's 12 months in a
year,
and so far I've gotten the first six correct," said Taylor.
"On the acquisition front, Titan has completed the
purchase of the Denman Tire name, tire specifications, patents, molds,
machinery & equipment and other items from Bankruptcy Court for $7.4
million. Denman did about $75 million in sales in 2008. I expect Titan
to get
its investment back in a short period of time. The other acquisitions
are
moving a little faster now, and we should be able to make a decision if
they
are a go or not within the next 45 days. Kent Hackamack has moved from
his
position of 15 years as vice president of finance and treasurer to
executive
vice president of corporate development to help me move things along.
Titan's
new chief financial officer is Paul Reitz, as previously announced.
Titan
should not miss a beat going forward.
"Overall, the quarter was good any way you look at
it. It looks great at this time as we move forward, but who really knows
what
will happen with the new rules and regulations our beloved politicians
are
creating. Maybe it would be better if they would go on vacation for a
few
years." ...click to continue
