Titan Intl (NYSE:TWI)

First Quarter 2012 Results

• Sales for first quarter 2012 were $463.1 million up 65 percent, compared to $280.8 million in the first quarter of 2011.
• Gross profit increased 66 percent for first quarter 2012 to $93.4 million, or 20.2 percent of net sales, compared to $56.3 million in 2011, or 20.0 percent of net sales. Gross profit excluding the Latin American business was $84.9 million or 22.8 percent of net sales for the first quarter 2012.
• First quarter income from operations was $58.7 million up 118 percent, compared to $26.9 million last year.
• Adjusted net income for the first quarter was $40.5 million, compared to $18.7 million in the first quarter of last year
• On an adjusted basis (see Appendix below), basic and fully diluted earnings per share were $.96 and $.78 respectively for the first quarter 2012 and $.46 and $.37 for 2011.

Chairman and CEO, Maurice Taylor states, “The first quarter 2012 was another record quarter in sales, net profit, EBITDA, etc. The order book is filled for the year and we must keep increasing our output. Farming, construction and earthmoving and mining are all very strong and we expect 2012 to be another year of growth. The dynamics in agriculture are changing around the world and are positively impacting the demand for machinery in the industry. Prices for metals, oil and gas prices in the Earthmoving and Mining markets are expected to remain at attractive levels to support strong demand.”

“In this past quarter there were some bloggers who were concerned over inventory and the auto supply industry. Titan International is not in the auto supply business, but we are in the OTR tire and wheel business. Titan builds to order. We do not estimate or forecast future business. If the orders were cancelled, we would have extra raw materials, but most raw materials would be processed in 30 days.”

Taylor adds, “Titan’s mining service business is a hot market. We have just opened a facility in the oil sands in Canada and already are receiving the demand to double the facility. Our partner in the oils sands is Saskatoon Wholesale Tire and they have never seen anything like this. In order to meet demand, all of Titan’s factories will be hiring and expanding operations. Titan has also ventured in to some new areas with the Union City, Tennessee factory. This large facility used to produce 48,000 passenger car tires per day. Since Titan doesn’t produce auto or truck tires, we will be contracting to various firms where we will supply the equipment and they will operate the business of mixing, calendaring and fabricating. Titan will still operate warehousing, equipment repair and new material inventory received. There is no question, with 2.2 million square feet under roof, we have plenty of room to expand or lease the space at this facility. To better visualize the size of this building, translate 2.2 million square feet into approximately 53 acres under roof.”

“As we enter a new year, Steve Briggs took over as president of our North American tire plants. We also have David Salen, president of the wheel group; Paul Reitz, CFO Titan International; and Mike Troyanovich, assistant general counsel. The above team will be running this company’s operations in the future. The senior team (myself included) will be focusing on the new opportunities we believe will grow this business. As I’ve outlined before, our vision is to be between a run rate of $3 to $4 billion in revenue by the end of 2013,” concluded Taylor.

Fourth Quarter 2011 Results

Titan Tire Corporation, a subsidiary of Titan International, Inc. (NYSE: TWI), announces a multi-year supply contract with Caterpillar for tires.

Titan has agreed to supply OTR tires to Caterpillar under a three-year agreement starting in 2012. The value of the contract in today’s dollars is expected to exceed a minimum of $100 million dollars.

Maurice Taylor, Titan International Chairman and CEO commented, “Titan is honored to work with Caterpillar and we look forward to supplying tires in support of Caterpillar equipment.”

"We have had a great year and we are forecasting 2012 to be our best year based on the conditions I see today,” commented Maurice Taylor, Chairman and CEO of Titan International. “The agriculture market remains strong, earthmover is booming and we see great opportunities in the export market. Assuming little change in raw material costs, I forecast Titan sales to range $1.7 billion to $1.9 billion for 2012. This sales range is projected to generate an EBITDA from $225 million to $300 million.”

There are catalysts that may drive these ranges higher. If the necessary equipment is installed at the respective facilities by September 2012, sales could exceed $2 billion. The 2012 forecast does not include any anticipated acquisitions. Details of any pending acquisitions would not be available for discussion until a public announcement is filed by the company.

Sales for 2011 are expected to be in range with the September guidance of $1.4 billion. “We exit the year with much optimism for what lies ahead for ag, construction and earthmoving business,” says Taylor.

“I wish you all a safe, healthy and happy holiday season. 2012 will be a real wild ride!”