QUINCY, Ill. (Feb. 24, 2011) — A stronger-than-expected fourth quarter helped propel Titan International Inc. to 21.2-percent higher fiscal 2010 sales of $881.6 million, but the farm and OTR tire and wheel maker barely eked out a profit because of reserves set aside for various reasons.
Fiscal 2010 pre-tax operating income improved to $649,000 from a $32 million loss a year ago; net income was $358,000 vs. a loss of $24.7 million. Titan Chairman and CEO Maurice Taylor Jr. explained the slim profits by pointing to a number of reserve items totaling several million dollars and the firm's $11.4 million repurchase of shares during the fourth quarter.
Looking at 2011, Taylor said Titan is running its plants flat out to meet rising demand.
“Farm demand is going strong and we believe it will go for a few more years,” he said during a conference call with analysts. “The mining business is coming up fast and we believe it has room to run. In the last two months orders have started to come in so fast that we are behind.”
Titan is hiring back more than 100 workers at its plants in Des Moines, Iowa; Freeport, Ill.; and Bryan, Ohio, Taylor said, and might need another 100 to meet demand. The personnel moves are despite the fact that only the United Steelworkers local at the Des Moines plant—which Taylor said is Titan's lowest cost facility—has ratified the firm's latest labor agreement.
“I believe with the correct management of these facilities, Titan will be on the road to proper profit,” he said.
Fourth-quarter sales of $232.7 million were up 58.8 percent over the 2009 period. Although the firm's operating result made a swing to a profit of $704,000 from a loss of $30.1 million, the net result was still in the red—$10.3 million vs. $34.1 million a year ago—based largely on a loss of $14.6 million associated with the repurchase of 8-percent outstanding senior unsecured notes due January 2012.