Titan International, Inc. Reports Third Quarter Financial Performance
Titan International (TWI) reported Q3 2024 financial results with net sales of $448.0 million, up from $401.8 million in Q3 2023, primarily driven by the Carlstar acquisition. The company generated strong free cash flow of $42 million and Adjusted EBITDA of $20.5 million. Gross profit decreased to $58.8 million (13.1% margin) from $66.1 million (16.4% margin) year-over-year. The agricultural segment saw a 17.6% decline in sales, while the consumer segment grew 303.4%. For Q4 2024, TWI expects sales between $375-425 million and adjusted EBITDA of breakeven to $10 million. Net debt stood at $291.2 million as of September 30, 2024.
Titan International (TWI) ha riportato i risultati finanziari del terzo trimestre del 2024 con vendite nette di 448,0 milioni di dollari, in aumento rispetto ai 401,8 milioni di dollari nel terzo trimestre del 2023, principalmente grazie all'acquisizione di Carlstar. L'azienda ha generato un forte flusso di cassa libero di 42 milioni di dollari e un EBITDA rettificato di 20,5 milioni di dollari. Il profitto lordo è diminuito a 58,8 milioni di dollari (margine del 13,1%) rispetto ai 66,1 milioni di dollari (margine del 16,4%) dell'anno precedente. Il segmento agricolo ha subito una diminuzione delle vendite del 17,6%, mentre il segmento dei consumatori è cresciuto del 303,4%. Per il quarto trimestre del 2024, TWI prevede vendite tra i 375-425 milioni di dollari e un EBITDA rettificato in pareggio fino a 10 milioni di dollari. Il debito netto si attestava a 291,2 milioni di dollari al 30 settembre 2024.
Titan International (TWI) reportó los resultados financieros del tercer trimestre de 2024 con ventas netas de 448,0 millones de dólares, un aumento desde los 401,8 millones de dólares en el tercer trimestre de 2023, impulsado principalmente por la adquisición de Carlstar. La compañía generó un fuerte flujo de caja libre de 42 millones de dólares y un EBITDA ajustado de 20,5 millones de dólares. La ganancia bruta disminuyó a 58,8 millones de dólares (margen del 13,1%) desde 66,1 millones de dólares (margen del 16,4%) en el año anterior. El segmento agrícola vio una disminución del 17,6% en las ventas, mientras que el segmento de consumidores creció un 303,4%. Para el cuarto trimestre de 2024, TWI espera ventas entre 375-425 millones de dólares y un EBITDA ajustado de equilibrio a 10 millones de dólares. La deuda neta se situó en 291,2 millones de dólares al 30 de septiembre de 2024.
타이탄 인터내셔널 (TWI)은 2024년 3분기 재무 결과를 보고하며, 순매출이 4억 4,800만 달러로, 2023년 3분기에는 4억 1,800만 달러였으며, 이는 주로 칼스타 인수에 의해 주도되었습니다. 이 회사는 4,200만 달러의 강력한 자유 현금 흐름을 창출했으며, 조정 EBITDA는 2,050만 달러에 달했습니다. 총 이익은 전년 대비 6,610만 달러(16.4% 마진)에서 5,880만 달러(13.1% 마진)로 감소했습니다. 농업 부문은 매출이 17.6% 감소했으며, 소비자 부문은 303.4% 성장했습니다. 2024년 4분기에는 TWI가 3억 7,500만에서 4억 2,500만 달러 사이의 매출을 예상하며, 조정 EBITDA는 손익 분기점에서 1,000만 달러까지로 예상하고 있습니다. 순부채는 2024년 9월 30일 기준으로 2억 9,120만 달러였습니다.
Titan International (TWI) a publié ses résultats financiers du troisième trimestre 2024 avec des ventes nettes de 448,0 millions de dollars, en hausse par rapport à 401,8 millions de dollars au troisième trimestre 2023, principalement en raison de l'acquisition de Carlstar. L'entreprise a généré un solide flux de trésorerie libre de 42 millions de dollars et un EBITDA ajusté de 20,5 millions de dollars. Le bénéfice brut a diminué à 58,8 millions de dollars (marge de 13,1 %) contre 66,1 millions de dollars (marge de 16,4 %) d'une année sur l'autre. Le segment agricole a enregistré une baisse des ventes de 17,6 %, tandis que le segment des consommateurs a connu une croissance de 303,4 %. Pour le quatrième trimestre 2024, TWI s'attend à des ventes comprises entre 375 et 425 millions de dollars et un EBITDA ajusté d'équilibre à 10 millions de dollars. La dette nette s'élevait à 291,2 millions de dollars au 30 septembre 2024.
Titan International (TWI) berichtete über die Finanzzahlen des dritten Quartals 2024 mit Nettoumsätzen von 448,0 Millionen Dollar, ein Anstieg von 401,8 Millionen Dollar im dritten Quartal 2023, hauptsächlich getrieben durch die Übernahme von Carlstar. Das Unternehmen erzielte einen starken freien Cashflow von 42 Millionen Dollar und ein bereinigtes EBITDA von 20,5 Millionen Dollar. Der Bruttogewinn sank im Jahresvergleich auf 58,8 Millionen Dollar (13,1% Marge) von 66,1 Millionen Dollar (16,4% Marge). Der Agrarsektor verzeichnete einen Rückgang der Verkaufszahlen um 17,6%, während der Verbrauchersektor um 303,4% wuchs. Für das vierte Quartal 2024 erwartet TWI einen Umsatz zwischen 375 und 425 Millionen Dollar und ein bereinigtes EBITDA von diesem Punkt bis 10 Millionen Dollar. Die Nettoverschuldung betrug zum 30. September 2024 291,2 Millionen Dollar.
- Strong free cash flow generation of $42 million in Q3
- Net sales increased 11.5% YoY to $448.0 million
- Consumer segment sales grew 303.4% to $136.2 million
- Reduced net debt to $291 million from $326 million in Q2 2024
- Repurchased 1,050,000 shares totaling $8.3 million in Q3
- Gross profit margin declined to 13.1% from 16.4% YoY
- Agricultural segment sales dropped 17.6% to $175.4 million
- Income from operations decreased to $2.8M from $27.0M YoY
- Q4 guidance shows expected weakness with adjusted EBITDA of $0-10M
- Earthmoving/construction segment sales declined 12.1% YoY
Insights
TWI's Q3 2024 results reveal significant challenges and opportunities. The company delivered
The most concerning metrics are margins and profitability. Gross margin contracted to
On the positive side, free cash flow remained strong at
The agricultural equipment market dynamics are particularly noteworthy. TWI's innovative LSW (Low-Side Wall) technology is gaining traction, with documented fuel savings exceeding
The company's strategic moves, including the Carlstar integration and VPO™ Technology launch, demonstrate proactive market positioning. However, current market headwinds are evident in the
Delivers Results Reflective of Industry Conditions, with strong Free Cash Flow of
Recent Interest Rate Decreases and Expected Clarity on Trade Policy Should Support Improving Conditions in 2025
Paul Reitz, President and Chief Executive Officer stated, "I have been spending a lot of time with customers in recent months, and it is clear that Titan's position as a valued partner centers on the innovative nature of the products we have developed and continue to develop. The Low-Side Wall ("LSW") wheel/tire assemblies continue to capture attention in the marketplace and I recently heard that directly from some very large farmers. They raved about the field performance, reduced soil compaction and highlighted fuel savings, according to their records, that far exceeds the 10 to
Mr. Reitz continued, "We are also working on tooling up to add the deep drop wheel to our LSW tires, which will improve field performance even further. The bottom-line is that I see a big opportunity ahead of us to educate more end-users that LSW is not just for combines and the largest tractors - the technology also works better on almost every piece of equipment, including mid-size tractors. That market size is easily another 25,000 new tractors produced annually, so tapping into a fraction of that would move the needle in our sales and EBITDA. There is simply no reason to run duals and we will be increasing our efforts and resources to reach more end-users to create further awareness of the LSW benefits for all sizes of Ag equipment to capture those significant opportunities."
Mr. Reitz added, "Across the entire business we are busy working to drive growth via product development from our flagship LSWs to growth via the Carlstar acquisition – all exemplifying that we are not simply sitting back and going with the flow of the market. We are excited to have recently launched our VPO™ Technology under the Carlstar brand, which offers a versatile solution as an alternative to tweel wheels and can operate machinery at various inflation pressures — even down to zero psi. We will soon be launching the first Titan branded high speed trailer tire. Beyond that we have extensive opportunities via the Carlstar acquisition to bring LSWs into their product mix, allowing us to grow into new geographies and underserved markets. I mentioned last quarter that we see a strong opportunity to gain back military sales that have diminished over the past 10 to 15 years. Our product innovations that perform well in Ag and Construction will also make military equipment perform better. We are expanding our outreach with some influential leaders in the military industry and will continue working to capture those sales."
Mr. Reitz continued, "Beyond our focus on growth, we are managing costs and focusing on what we can control. Cashflow was a bright spot for the quarter, driven by our steadfast focus on working capital management. We reduced debt, while continuing to buy back shares, and, on the whole, delivered solid results within the context of our end market conditions. We have reduced expenses to align costs with lower production schedules, including an approximate
Mr. Reitz concluded, "The large Ag OEMs and dealers have been vocal in recent months about their actions to further reduce inventory levels by the end of 2024. This is an encouraging sign as it suggests no further de-stocking activity of any magnitude entering 2025. Potential interest rate declines represent an additional positive factor, and the trade policy risk tied to the election should also abate as we turn the page to 2025. I remain exceptionally proud of our team at Titan to take actions with conviction to deliver for our customers and believe it is an exciting time for Titan to capitalize on growth opportunities."
Fourth Quarter 2024 Outlook
David Martin, Chief Financial Officer, added, "In the fourth quarter, we expect to see sales between
Results of Operations
Net sales for the three months ended September 30, 2024, were
Gross profit for the three months ending September 30, 2024 was
Selling, general and administrative expenses (SG&A) for the three months ended September 30, 2024 were
Income from operations for the three months ended September 30, 2024 was
The Company recorded income tax expense of
Segment Information
Agricultural Segment
(Amounts in thousands, except percentages) | Three months ended | Nine months ended | |||||||||
September 30, | September 30, | ||||||||||
2024 | 2023 | % | 2024 | 2023 | % | ||||||
Net sales | (17.6) % | (19.9) % | |||||||||
Gross profit | 16,720 | 37,026 | (54.8) % | 89,642 | 135,012 | (33.6) % | |||||
Profit margin | 9.5 % | 17.4 % | (45.4) % | 14.2 % | 17.1 % | (17.0) % | |||||
Income from operations | 1,910 | 21,383 | (91.1) % | 41,692 | 86,071 | (51.6) % |
Net sales in the agricultural segment were
Gross profit in the agricultural segment was
Earthmoving/Construction Segment
(Amounts in thousands, except percentages) | Three months ended | Nine months ended | |||||||||
September 30, | September 30, | ||||||||||
2024 | 2023 | % | 2024 | 2023 | % | ||||||
Net sales | (12.1) % | (11.6) % | |||||||||
Gross profit | 11,653 | 22,257 | (47.6) % | 55,929 | 88,583 | (36.9) % | |||||
Profit margin | 8.5 % | 14.4 % | (41.0) % | 12.0 % | 16.8 % | (28.6) % | |||||
(Loss) income from operations | (1,911) | 8,501 | (122.5) % | 13,970 | 46,561 | (70.0) % |
The Company's earthmoving/construction segment net sales were
Gross profit in the earthmoving/construction segment was
Consumer Segment
(Amounts in thousands, except percentages) | Three months ended | Nine months ended | |||||||||
September 30, | September 30, | ||||||||||
2024 | 2023 | % | 2024 | 2023 | % | ||||||
Net sales | 303.4 % | 216.4 % | |||||||||
Gross profit | 30,432 | 6,790 | 348.2 % | 71,046 | 23,930 | 196.9 % | |||||
Profit margin | 22.3 % | 20.1 % | 10.9 % | 19.5 % | 20.8 % | (6.3) % | |||||
Income from operations | 11,282 | 4,526 | 149.3 % | 22,844 | 17,183 | 32.9 % |
Consumer segment net sales were
Gross profit from the consumer segment was
Non-GAAP Financial Measures
Adjusted EBITDA was
Adjusted net income applicable to common shareholders for the third quarter of 2024 was income of
Financial Condition
The Company ended the third quarter of 2024 with total cash and cash equivalents of
Net cash provided by operating activities for the first nine months of 2024 was
Teleconference and Webcast
Titan will be hosting a teleconference and webcast to discuss the third quarter financial results on Thursday, October 31, 2024, at 9:00 a.m. Eastern Time.
The real-time, listen-only webcast can be accessed using the following link https://events.q4inc.com/attendee/566818353 or on our website at www.titan-intl.com within the "Investor Relations" page under the "News & Events" menu (https://ir.titan-intl.com/news-and-events/events/default.aspx). Listeners should access the website at least 10 minutes prior to the live event to download and install any necessary audio software.
A webcast replay of the teleconference will be available on our website (https://ir.titan-intl.com/news-and-events/events/default.aspx) soon after the live event.
In order to participate in the real-time teleconference, with live audio Q&A, participants should use one of the following dial in numbers:
United States Toll Free: 1 833 470 1428
All other locations: https://www.netroadshow.com/conferencing/global-numbers?confId=56511
Participants Access Code: 971353
About Titan
Titan International, Inc. (NYSE: TWI) is a leading global manufacturer of off-highway wheels, tires, assemblies, and undercarriage products. Headquartered in
Safe Harbor Statement
This press release contains forward-looking statements. These forward-looking statements are covered by the safe harbor for "forward-looking statements" provided by the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "anticipate," "plan," "would," "could," "potential," "may," "will," and other similar expressions are intended to identify forward-looking statements, which are generally not historical in nature. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. Although we believe the assumptions upon which these forward-looking statements are based are reasonable, these assumptions are subject to significant risks and uncertainties, and are subject to change based on various factors, some of which are beyond Titan International, Inc.'s control. As a result, any of these assumptions could prove to be inaccurate and the forward-looking statements based on these assumptions could be incorrect. The matters discussed in these forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results and trends to differ materially from those made, projected, or implied in or by the forward-looking statements depending on a variety of uncertainties or other factors including, but not limited to, the effect of the COVID-19 pandemic on our operations and financial performance; the effect of a recession on the Company and its customers and suppliers; changes in the Company's end-user markets into which the Company sells its products as a result of domestic and world economic or regulatory influences or otherwise; changes in the marketplace, including new products and pricing changes by the Company's competitors; the Company's ability to maintain satisfactory labor relations; unfavorable outcomes of legal proceedings; the Company's ability to comply with current or future regulations applicable to the Company's business and the industry in which it competes or any actions taken or orders issued by regulatory authorities; availability and price of raw materials; levels of operating efficiencies; the effects of the Company's indebtedness and its compliance with the terms thereof; changes in the interest rate environment and their effects on the Company's outstanding indebtedness; unfavorable product liability and warranty claims; actions of domestic and foreign governments, including the imposition of additional tariffs; geopolitical and economic uncertainties relating to the countries in which the Company operates or does business; risks associated with acquisitions, including difficulty in integrating operations and personnel, disruption of ongoing business, and increased expenses; results of investments; the effects of potential processes to explore various strategic transactions, including potential dispositions; fluctuations in currency translations; risks associated with environmental laws and regulations; risks relating to our manufacturing facilities, including that any of our material facilities may become inoperable; risks relating to financial reporting, internal controls, tax accounting, and information systems; and the other risks and factors detailed in the Company's periodic reports filed with the Securities and Exchange Commission, including the disclosures under "Risk Factors" in those reports. These forward-looking statements are made only as of the date hereof. The Company cautions that any forward-looking statements included in this press release are subject to a number of risks and uncertainties, and the Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, changed circumstances or future events, or for any other reason, except as required by law.
Titan International, Inc. | |||||||
Condensed Consolidated Statements of Operations (Unaudited) | |||||||
Amounts in thousands, except per share data | |||||||
Three months ended | Nine months ended | ||||||
September 30, | September 30, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Net sales | |||||||
Cost of sales | 389,180 | 335,708 | 1,245,747 | 1,184,076 | |||
Gross profit | 58,805 | 66,073 | 216,617 | 247,525 | |||
Selling, general and administrative expenses | 49,533 | 33,587 | 140,536 | 102,917 | |||
Acquisition related expenses | — | — | 6,196 | — | |||
Research and development expenses | 4,199 | 3,167 | 12,071 | 9,399 | |||
Royalty expense | 2,266 | 2,344 | 7,613 | 7,200 | |||
Income from operations | 2,807 | 26,975 | 50,201 | 128,009 | |||
Interest expense | (9,005) | (7,229) | (27,103) | (22,446) | |||
Interest income | 3,064 | 3,298 | 8,483 | 6,261 | |||
Foreign exchange (loss) gain | (2,525) | 876 | (2,338) | (882) | |||
Other income | 375 | 461 | 4,057 | 2,409 | |||
(Loss) income before income taxes | (5,284) | 24,381 | 33,300 | 113,351 | |||
Provision for income taxes | 12,915 | 4,718 | 38,103 | 28,363 | |||
Net (loss) income | (18,199) | 19,663 | (4,803) | 84,988 | |||
Net income attributable to noncontrolling interests | 50 | 383 | 2,096 | 3,663 | |||
Net (loss) income attributable to Titan and applicable to | $ 19,280 | $ (6,899) | $ 81,325 | ||||
(Loss) earnings per common share: | |||||||
Basic | $ (0.25) | $ 0.31 | $ (0.10) | $ 1.29 | |||
Diluted | $ (0.25) | $ 0.31 | $ (0.10) | $ 1.29 | |||
Average common shares and equivalents outstanding: | |||||||
Basic | 72,013 | 62,598 | 69,900 | 62,810 | |||
Diluted | 72,013 | 63,095 | 69,900 | 63,271 |
Titan International, Inc. | |||
Condensed Consolidated Balance Sheets | |||
Amounts in thousands, except share data | |||
September 30, | December 31, | ||
Assets | (unaudited) | ||
Current assets | |||
Cash and cash equivalents | $ 227,293 | $ 220,251 | |
Accounts receivable, net of allowance of | 272,837 | 219,145 | |
Inventories | 453,632 | 365,156 | |
Prepaid and other current assets | 71,977 | 72,229 | |
Total current assets | 1,025,739 | 876,781 | |
Property, plant and equipment, net | 440,298 | 321,694 | |
Operating lease assets | 120,330 | 11,955 | |
Goodwill | 35,810 | — | |
Intangible assets, net | 13,036 | 1,431 | |
Deferred income taxes | 8,106 | 38,033 | |
Other long-term assets | 43,405 | 39,351 | |
Total assets | $ 1,686,724 | $ 1,289,245 | |
Liabilities | |||
Current liabilities | |||
Short-term debt | $ 15,025 | $ 16,913 | |
Accounts payable | 234,302 | 201,201 | |
Operating leases | 13,077 | 5,021 | |
Other current liabilities | 168,897 | 139,378 | |
Total current liabilities | 431,301 | 362,513 | |
Long-term debt | 503,429 | 409,178 | |
Deferred income taxes | 2,524 | 2,234 | |
Operating leases | 109,187 | 6,153 | |
Other long-term liabilities | 42,229 | 41,752 | |
Total liabilities | 1,088,670 | 821,830 | |
Commitments and Contingencies | |||
Equity | |||
Titan shareholders' equity | |||
Common stock ( | — | — | |
Additional paid-in capital | 738,420 | 569,065 | |
Retained earnings | 162,724 | 169,623 | |
Treasury stock (at cost, 7,263,007 shares at September 30, 2024 and 5,809,414 shares | (64,424) | (52,585) | |
Accumulated other comprehensive loss | (238,953) | (219,043) | |
Total Titan shareholders' equity | 597,767 | 467,060 | |
Noncontrolling interests | 287 | 355 | |
Total equity | 598,054 | 467,415 | |
Total liabilities and equity | $ 1,686,724 | $ 1,289,245 |
Titan International, Inc. | |||
Condensed Consolidated Statements of Cash Flows (Unaudited) | |||
All amounts in thousands | |||
Nine months ended | |||
Cash flows from operating activities: | 2024 | 2023 | |
Net (loss) income | $ (4,803) | $ 84,988 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 40,059 | 31,598 | |
Deferred income tax provision | 21,646 | 5,868 | |
Income on indirect taxes | — | (3,096) | |
Loss (gain) on fixed asset and investment sale | 625 | (409) | |
Stock-based compensation | 3,601 | 3,700 | |
Issuance of stock under 401(k) plan | 1,328 | 1,329 | |
Proceeds from property insurance settlement | (3,537) | — | |
Foreign currency loss (gain) | 1,375 | (2,348) | |
(Increase) decrease in assets, net of acquisitions: | |||
Accounts receivable | 28,886 | 17,503 | |
Inventories | 53,914 | 32,197 | |
Prepaid and other current assets | 10,856 | 18,386 | |
Other assets | (2,431) | (410) | |
Increase (decrease) in liabilities, net of acquisitions: | |||
Accounts payable | (28,502) | (62,751) | |
Other current liabilities | 8,317 | 12,241 | |
Other liabilities | 1,417 | 1,310 | |
Net cash provided by operating activities | 132,751 | 140,106 | |
Cash flows from investing activities: | |||
Capital expenditures | (52,318) | (41,480) | |
Business acquisition, net of cash acquired | (143,643) | — | |
Proceeds from sale of investment | 1,791 | — | |
Proceeds from property insurance settlement | 3,537 | — | |
Proceeds from sale of fixed assets | 1,603 | 1,795 | |
Net cash used for investing activities | (189,030) | (39,685) | |
Cash flows from financing activities: | |||
Proceeds from borrowings | 159,614 | 6,628 | |
Repayments of debt | (66,601) | (25,017) | |
Payment of debt issuance costs | (3,115) | — | |
Repurchase of common stock | (16,106) | (19,064) | |
Other financing activities | (738) | (2,540) | |
Net cash provided by (used for) financing activities | 73,054 | (39,993) | |
Effect of exchange rate changes on cash | (9,733) | (8,103) | |
Net increase in cash and cash equivalents | 7,042 | 52,325 | |
Cash and cash equivalents, beginning of period | 220,251 | 159,577 | |
Cash and cash equivalents, end of period | |||
Supplemental information: | |||
Interest paid | $ 20,500 | $ 15,971 | |
Income taxes paid, net of refunds received | $ 16,422 | $ 17,581 | |
Non cash financing activity: | |||
Issuance of common stock in connection with business acquisition | $ — |
Titan International, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited)
Amounts in thousands, except earnings per share data and percentages
The Company reports its financial results in accordance with generally accepted accounting principles in
We present adjusted gross profit, adjusted net income attributable to Titan, adjusted earnings per common share, EBITDA, adjusted EBITDA, net sales on a constant currency basis, net debt and net cash provided by operating activities to free cash flow, as we believe that they assist investors with analyzing our business results. In addition, management reviews these non-GAAP financial measures in order to evaluate the financial performance of each of our segments, as well as the Company's performance as a whole. We believe that the presentation of these non‑GAAP financial measures will permit investors to assess the performance of the Company on the same basis as management.
Adjusted gross profit, adjusted net income attributable to Titan, adjusted earnings per common share, EBITDA, adjusted EBITDA, net sales on a constant currency basis, net debt, and free cash flow should be considered supplemental to, not a substitute for, the financial measures calculated in accordance with GAAP. One should not consider these measures in isolation or as a substitute for our results reported under GAAP. These measures have limitations in that they do not reflect all of the costs associated with the operations of our businesses as determined in accordance with GAAP. In addition, these measures may be calculated differently than non-GAAP financial measures reported by other companies, limiting their usefulness as comparative measures. We attempt to compensate for these limitations by analyzing results on a GAAP basis as well as a non-GAAP basis, prominently disclosing GAAP results and providing reconciliations from GAAP results to non-GAAP results.
The table below provides a reconciliation of adjusted gross profit to gross profit, the most directly comparable GAAP financial measure, for the three and nine-month periods ended September 30, 2024 and 2023 (in thousands, except percentages).
Three months ended | Three months ended | |||||
September 30, 2024 | September 30, 2023 | |||||
Agricultural | Earthmoving/ | Consumer | Total | Total | ||
Gross profit, as reported | $ 16,720 | $ 11,653 | $ 30,432 | $ 58,805 | $ 66,073 | |
Gross Margin | 9.5 % | 8.5 % | 22.3 % | 13.1 % | 16.4 % | |
Adjustments: | ||||||
Carlstar inventory fair value | 38 | 26 | 736 | 800 | — | |
Gross profit, as adjusted | $ 16,758 | $ 11,679 | $ 31,168 | $ 59,605 | $ 66,073 | |
Adjusted Gross Margin | 9.6 % | 8.6 % | 22.9 % | 13.3 % | 16.4 % | |
Nine months ended | Nine months ended | |||||
September 30, 2024 | September 30, 2023 | |||||
Agricultural | Earthmoving/ | Consumer | Total | Total | ||
Gross profit, as reported | $ 89,642 | $ 55,929 | $ 71,046 | $ 247,525 | ||
Gross Margin | 14.2 % | 12.0 % | 19.5 % | 14.8 % | 17.3 % | |
Adjustments: | ||||||
Carlstar inventory fair value | 1,809 | 318 | 9,373 | 11,500 | — | |
Gross profit, as adjusted | $ 91,451 | $ 56,247 | $ 80,419 | $ 247,525 | ||
Adjusted Gross Margin | 14.5 % | 12.0 % | 22.1 % | 15.6 % | 17.3 % |
The table below provides a reconciliation of adjusted net income attributable to Titan to net income applicable to common shareholders, the most directly comparable GAAP financial measure, for the three and nine-month periods ended September 30, 2024 and 2023 (in thousands, except earnings per share).
Three months ended | Nine months ended | ||||||
September 30, | September 30, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Net (loss) income attributable to Titan and applicable to | |||||||
Adjustments: | |||||||
Foreign exchange loss (gain) | 2,525 | (876) | 2,338 | 882 | |||
Carlstar transaction costs | — | — | 6,196 | — | |||
Carlstar inventory fair value step-up | 800 | — | 11,500 | — | |||
Loss on sale of investment | 1,032 | — | 1,032 | — | |||
Gain on property insurance settlement | — | — | (1,913) | — | |||
Income on Brazilian indirect tax credits, net | — | — | — | (3,096) | |||
Adjusted net (loss) income attributable to Titan and | |||||||
Adjusted (loss) earnings per common share: | |||||||
Basic | $ (0.19) | $ 0.29 | $ 0.18 | $ 1.26 | |||
Diluted | $ (0.19) | $ 0.29 | $ 0.17 | $ 1.25 | |||
Average common shares and equivalents outstanding: | |||||||
Basic | 72,013 | 62,598 | 69,900 | 62,810 | |||
Diluted | 72,404 | 63,095 | 70,358 | 63,271 |
The table below provides a reconciliation of net income to EBITDA and adjusted EBITDA, which are non-GAAP financial measures, for the three and nine-month periods ended September 30, 2024 and 2023 (in thousands).
Three months ended | Nine months ended | ||||||
September 30, | September 30, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Net (loss) income | $ (4,803) | $ 84,988 | |||||
Adjustments: | |||||||
Provision for income taxes | 12,915 | 4,718 | 38,103 | 28,363 | |||
Interest expense, excluding financing fees amortization | 8,786 | 7,009 | 26,446 | 21,789 | |||
Depreciation and amortization | 12,636 | 10,033 | 40,059 | 31,598 | |||
EBITDA | $ 16,138 | $ 99,805 | |||||
Adjustments: | |||||||
Foreign exchange loss (gain) | 2,525 | (876) | 2,338 | 882 | |||
Carlstar transaction costs | — | — | 6,196 | — | |||
Carlstar inventory fair value step-up | 800 | — | 11,500 | — | |||
Loss on sale of investment | 1,032 | — | 1,032 | — | |||
Gain on property insurance settlement | — | — | (1,913) | — | |||
Income on Brazilian indirect tax credits | — | — | — | (475) | |||
Adjusted EBITDA | $ 20,495 |
The table below sets forth, for the three and nine-month periods ended September 30, 2024, the impact to net sales of currency translation (constant currency) by geography (in thousands, except percentages):
Three months ended September 30, | Change due to currency | Three months ended | |||||||||
2024 | 2023 | % Change | $ | % | Constant Currency | ||||||
$ 250,567 | $ 173,300 | 44.6 % | $ — | — % | $ 250,567 | ||||||
97,053 | 119,749 | (19.0) % | 2,121 | 1.8 % | 94,932 | ||||||
76,023 | 89,258 | (14.8) % | (14,014) | (15.7) % | 90,037 | ||||||
Other International | 24,342 | 19,474 | 25.0 % | (1,437) | (7.4) % | 25,779 | |||||
$ 447,985 | $ 401,781 | 11.5 % | (3.3) % | $ 461,315 | |||||||
Nine months ended September 30, | Change due to currency | Nine months ended | |||||||||
2024 | 2023 | % Change | $ | % | Constant Currency | ||||||
$ 813,767 | $ 654,324 | 24.4 % | $ — | — % | $ 813,767 | ||||||
352,731 | 424,412 | (16.9) % | (5,219) | (1.2) % | 357,950 | ||||||
225,529 | 283,132 | (20.3) % | (26,202) | (9.3) % | 251,731 | ||||||
Other International | 70,337 | 69,733 | 0.9 % | (12,550) | (18.0) % | 82,887 | |||||
2.1 % | (3.1) % | $ 1,506,335 |
The table below provides a reconciliation of net debt, which is a non-GAAP financial measure (in thousands):
September 30, | December 31, | September 30, | |||
Long-term debt | |||||
Short-term debt | 15,025 | 16,913 | 17,556 | ||
Total debt | |||||
Cash and cash equivalents | 227,293 | 220,251 | 211,902 | ||
Net debt |
The table below provides a reconciliation of net cash provided by operating activities to free cash flow, which is a non-GAAP financial measure (in thousands):
Three months ended | Nine months ended | ||||||
September 30, | September 30, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Net cash provided by operating activities | |||||||
Capital expenditures | (18,119) | (13,913) | (52,318) | (41,480) | |||
Free cash flow | $ 80,433 | $ 98,626 |
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SOURCE Titan International, Inc.
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