Titan Machinery Revenue Tumbles in Fiscal 2015 Fourth Quarter
Titan Machinery, a network of full-service construction and agricultural equipment stores including rental operations, said it expects its fourth quarter of fiscal 2015 to total about $491 million in revenue, compared to revenue of $708.6 million in the fourth quarter of last year, a 44-percent decrease. The quarter ended Jan. 31. The company plans to release its fourth quarter and full year complete results April 15.
Titan is recognizing non-cash impairment charges of about $31 million in the quarter, primarily related to goodwill and other intangible assets in the agriculture segment. Pre-tax loss for the quarter is expected to be approximately $37 million. Adjusted pre-tax loss in the construction segment is expected to be about $5 million.
For the full fiscal year, Titan Machinery expects revenue to be about $1.9 billion, compared to $2.23 billion the previous year, a 14.8-percent drop. Excluding the non-cash impairment charge, realignment costs of $3 million, and Ukraine currency devaluation of $6 million.
Titan Machinery is reducing staff by 14 percent “to better align its business in certain markets”, the company said, including the closing of three agriculture stores and one construction store.
“Our Agriculture segment performance was impacted by continued industry headwinds in this segment,” said Titan Machinery chairman and CEO David Meyer. “We reduced our equipment inventory by approximately $168 million in fiscal 2015, which enabled us to generate approximately $82 million of adjusted cash flow from operations. We believe we are well positioned to achieve further inventory reductions and strong adjusted cash flow from operations in fiscal 2016.”
Titan expects construction same-store sales to be flat in 2016, while agricultural same-stores will decline by 25 percent. It also expects its international dealership business to be flat.
Based in West Fargo, N.D., Titan Machinery is No. 31 on the RER 100.
