Tire and wheel maker Titan International Inc. made gains in sales and profits in the third quarter, but still posted a $13.4 million loss on net sales of $111.2 million during the period, the firm announced Oct. 31.
The Quincy-based company also said it plans to take its Titan Europe subsidiary public by gaining a listing on the AIM market of the London Stock Exchange.
Titan's third-quarter figures improved on the $17.7 million loss on sales of $104.7 million reported last year. Year-to-date, the company posted a $27.4 million net loss on sales of $371.2 million, compared to a $20.1 million net loss on sales of $354.2 million in 2002.
Higher raw material prices and increased employee benefit insurance and other costs negatively impacted Titan by about $2.1 million, the company reported. Also, costs of about $1.7 million associated with the consolidation of all the firm's tire manufacturing operations into its Des Moines, Iowa, facility also were incurred in the third quarter.
Titan stopped making tires at its Brownsville, Texas, facility in July because of adverse market conditions and reduced demand. It has operated as a distribution center and warehouse since then and will do so until its capacity is required again.
Titan's cost-cutting measures and manufacturing efficiency improvements-combined with stronger farm and construction markets-should translate into a better position for the firm in 2004, said Maurice Taylor Jr., the company's president and CEO.
In taking Titan Europe public, the parent company's board of directors has retained financial services firm Seymour Pierce of London to prepare the arrangements-including placing on behalf of the company up to about $50 million.
Titan Europe's annual revenue is about $130 million, and has growth potential as a publicly quoted European company, the U.S. parent firm said. The subsidiary will gain the freedom to use its own financial resources to expand, especially in Europe, Taylor said.
As its largest stockholder, Titan International also will benefit from the growth, using the funds received to strengthen its balance sheet and take advantage of opportunities in the North American market, Taylor said.
The company had trouble with the New York Stock Exchange earlier this year because of its falling U.S. stock. The NYSE notified Titan in March that because its common stock price had fallen below a minimum of $1, it had a six-month period to stabilize it.
When the cure period ended Sept. 12, the exchange told Titan it had met the minimum share price requirement. The price closed that day at $2.14, and hasn't been below $1 since June 10. The stock closed at $1.97 on Nov. 3.