Titan International, Inc. Reports First Quarter Financial Performance

Core Insights - Titan International, Inc. reported Q1 2025 revenues of $491 million and Adjusted EBITDA of $31 million, both at the higher end of guidance [1][2] - The company is strategically positioned to benefit from current trade policies due to its domestic production capabilities, which reduce exposure to tariffs compared to competitors reliant on overseas production [2][3] Financial Performance - Net sales for Q1 2025 were $490.7 million, up from $482.2 million in Q1 2024, primarily driven by increased sales volumes from the Titan Specialty acquisition and positive price/mix effects [4] - Gross profit for Q1 2025 was $68.6 million, representing 14.0% of net sales, down from $77.4 million or 16.0% in Q1 2024, attributed to lower sales volume impacting fixed cost leverage [5][6] - Selling, general and administrative expenses (SG&A) increased to $49.9 million, or 10.2% of net sales, compared to $39.4 million, or 8.2% in the prior year, due to recurring costs from Titan Specialty operations [7] Segment Performance - Agricultural segment net sales decreased by 17.5% to $197.7 million, with gross profit down 39.7% to $24.5 million, driven by reduced global demand for agricultural equipment [10][11] - Earthmoving/construction segment net sales fell by 13.3% to $143.3 million, with gross profit down 35.2% to $14.9 million, impacted by lower sales volume and inflationary costs [12][13] - Consumer segment net sales surged by 93.6% to $149.7 million, with gross profit increasing by 112.5% to $29.3 million, largely due to the Titan Specialty acquisition [14][15] Outlook - The company expects Q2 2025 sales between $450 million and $500 million, with Adjusted EBITDA between $25 million and $35 million, similar to Q1 results [3] - Less than 10% of total revenues are expected to have a net negative exposure to current retaliatory China tariffs, indicating minimal impact from tariffs on upcoming results [3] Financial Condition - As of March 31, 2025, total cash and cash equivalents were $174.4 million, down from $196.0 million at the end of 2024, while long-term debt increased to $571.6 million [18] - The company reported a net cash used for operating activities of $38.6 million in Q1 2025, primarily due to increased working capital [19][20] Non-GAAP Financial Measures - Adjusted EBITDA for Q1 2025 was $30.8 million, down from $49.7 million in Q1 2024, reflecting the company's operating performance [16] - Adjusted net income applicable to common shareholders was $0.7 million, or $0.01 per share, compared to $19.0 million, or $0.29 per share, in the prior year [17]