Revenue Trend Continues Downward for Titan Machinery in Third Quarter
Construction and agricultural equipment distributor Titan Machinery posted $345 million for the third quarter of fiscal 2016, compared to $493.1 million in the third quarter a year ago, a 30-percent decline. Revenue from “rental and other,” which is predominantly rental, declined from $26.6 in the year-ago quarter to $21.3 in the quarter ended Oct. 31, a 19.9-percent slide.
Gross profit for fiscal Q3 was $67.1 million, compared to $84.7 a year ago, primarily because of a drop in agriculture equipment revenue.
Total revenue was $1.03 billion for the first nine months of fiscal 2016, compared to $1.41 billion in the year-ago frame, a 27-percent drop.
“Our Agriculture segment sales continue to be impacted by ongoing industry headwinds, and our third quarter results also impacted by lower than expected contribution from our parts and service business as farmers throughout the Upper Midwest experienced relatively favorable harvest conditions that required minimal equipment maintenance. In addition, our Construction segment was impacted by lower oil prices and reduced demand for equipment from agricultural customers. Based on our year-to-date results and outlook for the fourth quarter, we are updating our annual modeling assumptions.”
The company expects that for fiscal 2016 construction same-store sales will be down 8 to 13 percent, and agricultural same-store sales will plunge 28 to 33 percent.
Titan Machinery is based in West Fargo, N.D.
About the Author
Michael Roth
Editor
Michael Roth has covered the equipment rental industry full time for RER since 1989 and has served as the magazine’s editor in chief since 1994. He has nearly 30 years experience as a professional journalist. Roth has visited hundreds of rental centers and industry manufacturers, written hundreds of feature stories for RER and thousands of news stories for the magazine and its electronic newsletter RER Reports. Roth has interviewed leading executives for most of the industry’s largest rental companies and manufacturers as well as hundreds of smaller independent companies. He has visited with and reported on rental companies and manufacturers in Europe, Central America and Asia as well as Mexico, Canada and the United States. Roth was co-founder of RER Reports, the industry’s first weekly newsletter, which began as a fax newsletter in 1996, and later became an online newsletter. Roth has spoken at conventions sponsored by the American Rental Association, Associated Equipment Distributors, California Rental Association and other industry events and has spoken before industry groups in several countries. He lives and works in Los Angeles when he’s not traveling to cover industry events.