Revenue Declines but Equipment Margins Improve for Titan in Fiscal Q1
Titan Machinery posted fiscal 2019 first quarter revenue of $245.7 million compared to $264.1 million in the first quarter of 2018, a 7 percent decline. Equipment sales were $156.9 million in the quarter compared to $167.9 million a year ago. Revenue from “rental and other”, primarily rental, was $9.9 million for the quarter, compared to $10.9 million a year ago, a 9.2-percent slide.
Gross profit for the first quarter of fiscal 2019 was $47.6 million compared to $48.9 million a year ago. Gross profit margin was 19.4 percent in the fiscal first quarter, compared to 18.5 percent a year ago, primarily because of improved equipment margins.
For the construction segment, revenue for the first quarter of fiscal 2019 was $62.1 million, compared to $63.4 million a year ago.
“During the first quarter, we experienced improvements in gross and pre-tax margins driven by higher equipment margins, lower interest expense and our better-positioned expense structure,” said David Meyer, Titan Machinery chairman and CEO. “These results were partially offset by the late start to the spring planting season, which affected certain areas of our business, including parts and service revenue. Overall our first quarter margin improvements highlight the enhancements we’ve made to our operating model, and we believe this is setting the foundation for stronger top and bottom line results in fiscal 2019.”
Revenue in the agricultural segment of Titan was $142.9 million, compared to $163.6 million a year ago, partly because of a lower store count resulting from the company’s fiscal 2018 restructuring plan.
In the international dealership segment, Titan posted fiscal first quarter revenue of $40.7 million compared to $37.1 million a year ago.
Titan expects its construction segment to grow 3 to 8 percent in fiscal 2019, its agriculture segment to go up 0 to 5 percent and its international segment to leap 10 to 15 percent.
Titan Machinery, based in West Fargo, N.D., is No. 45 on the RER 100.
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.