- Revenue for the Fourth Quarter of Fiscal 2018 Increased to $340 Million -
- GAAP EPS for the Fourth Quarter of Fiscal 2018 was $0.08 and Adjusted EPS was ($0.10) -
- Company Announces Modeling Assumptions for Fiscal 2019 -
WEST FARGO, N.D., March 29, 2018 (GLOBE NEWSWIRE) -- Titan Machinery Inc. (Nasdaq:TITN), a leading network of full-service agricultural and construction equipment stores, today reported financial results for the fiscal fourth quarter and full year ended January 31, 2018.
David Meyer, Titan Machinery’s Chairman and Chief Executive Officer, stated, “We were well positioned to capture the anticipated fiscal fourth quarter acceleration in Agriculture sales activity due to better than anticipated crop yields in our footprint and the resulting improvement in grower sentiment. As a result of our improved inventory position, we continue to experience increased equipment margins compared to the prior year. In addition, fiscal full year 2018 performance was highlighted by reduced operating expenses and a more efficient operating structure due to the completion of our restructuring efforts. We are pleased with the overall business improvements we achieved in fiscal 2018 and believe these enhancements set the foundation for stronger top and bottom line results in fiscal 2019."
Fiscal 2018 Fourth Quarter Results
Consolidated Results
For the fourth quarter of fiscal 2018, revenue was $339.6 million, compared to revenue of $317.6 million in the fourth quarter last year. Equipment sales were $252.6 million for the fourth quarter of fiscal 2018, compared to $226.9 million in the fourth quarter last year. Parts sales were $45.5 million for the fourth quarter of fiscal 2018, compared to $48.7 million in the fourth quarter last year. Revenue generated from service was $26.5 million for the fourth quarter of fiscal 2018, compared to $28.0 million in the fourth quarter last year. Revenue from rental and other was $15.0 million for the fourth quarter of fiscal 2018, compared to $14.0 million in the fourth quarter last year.
Gross profit for the fourth quarter of fiscal 2018 increased to $52.1 million compared to $48.8 million in the fourth quarter last year. The Company's gross profit margin was relatively flat at 15.3% in the fourth quarter of fiscal 2018, compared to 15.4% in the fourth quarter last year. Gross profit margin remained relatively flat as the impact of higher equipment margins was offset by a change in our gross profit mix, which was the result of additional equipment revenue as compared to higher margin parts and service revenue.
Operating expenses were $50.3 million or 14.8% of revenue for the fourth quarter of fiscal 2018, compared to $52.2 million or 16.5% of revenue for the fourth quarter last year. Restructuring efforts that were completed in fiscal 2018 are expected to continue to reduce operating expenses on a going forward basis.
Floorplan interest expense decreased to $1.4 million for the fourth quarter of fiscal 2018, compared to $2.7 million for the same period last year. The decrease in floorplan interest expense is primarily due to a decrease in the level of interest-bearing inventory in the fourth quarter of fiscal 2018.
In the fourth quarter of fiscal 2018, net income including noncontrolling interest was $1.7 million, or $0.08 per diluted share, compared to a net loss including noncontrolling interest of $8.2 million, or $0.38 per diluted share for the fourth quarter of fiscal 2017.
On an adjusted basis, net loss including noncontrolling interest for the fourth quarter of fiscal 2018 was $2.1 million, or $0.10 per diluted share, compared to adjusted net loss including noncontrolling interest of $6.6 million, or $0.31 per diluted share for the fourth quarter of fiscal 2017. The adjusted amount for fourth quarter of 2018 excludes a gain of $1.8 million that occurred as a result of the Tax Cuts and Jobs Act (the "Tax Act") enacted on December 22, 2017 and a $2.4 million net benefit related to income tax valuation allowance adjustments.
The Company generated $6.1 million in adjusted EBITDA in the fourth quarter of fiscal 2018, compared to an adjusted EBITDA loss of $4.1 million for the fourth quarter of fiscal 2017.
Segment Results
Agriculture Segment - Revenue for the fourth quarter of fiscal 2018 was $205.3 million, compared to $201.1 million in the fourth quarter last year. Pre-tax income for the fourth quarter of fiscal 2018 was $2.2 million, compared to pre-tax loss of $5.9 million in the fourth quarter last year. Adjusted pre-tax income for the fourth quarter of fiscal 2018 was $2.0 million, compared to an adjusted pre-tax loss of $4.8 million in the fourth quarter last year.
Construction Segment - Revenue for the fourth quarter of fiscal 2018 was $85.8 million, compared to $81.7 million in the fourth quarter last year. Pre-tax loss for the fourth quarter of fiscal 2018 was $3.2 million, compared to a pre-tax loss of $4.4 million in the fourth quarter last year. Adjusted pre-tax loss for the fourth quarter of fiscal 2018 was $2.6 million, compared to $3.0 million in the fourth quarter last year.
International Segment - Revenue for the fourth quarter of fiscal 2018 was $48.5 million, compared to $34.8 million in the fourth quarter last year. Pre-tax loss for the fourth quarter of fiscal 2018 was $1.1 million, compared to pre-tax loss of $0.4 million in the fourth quarter last year. Adjusted pre-tax loss for the fourth quarter of fiscal 2018 was $1.1 million, compared to $0.1 million in the fourth quarter last year.
Fiscal 2018 Full Year Results
Revenue was flat at $1.2 billion for fiscal 2018 and the prior year. Net loss including noncontrolling interest for fiscal 2018 was $7.0 million, or $0.32 per diluted share, compared to net loss including noncontrolling interest of $14.5 million, or $0.65 per diluted share, for the prior year. Adjusted net loss including noncontrolling interest for fiscal 2018 was $2.7 million, or $0.12 per diluted share, compared to $14.2 million, or $0.65 per diluted share, for the prior year. The adjusted figure for fiscal 2018 excludes $10.5 million of restructuring expenses associated with our fiscal 2018 restructuring plan, which is partially offset by the aforementioned tax benefits related to the Tax Act and income tax valuation allowance adjustments that were recognized in the fourth quarter of fiscal 2018. The Company generated adjusted EBITDA of $30.8 million in fiscal 2018, compared to adjusted EBITDA of $11.7 million in fiscal 2017.
Balance Sheet and Cash Flow
The Company ended the fourth quarter of fiscal 2018 with $53.4 million of cash. The Company’s equipment inventory level increased to $400.0 million as of January 31, 2018, compared to $395.7 million as of January 31, 2017. As of January 31, 2018, the Company had $247.4 million outstanding floorplan payables, on $728.1 million total discretionary floorplan lines of credit, which represents an increase of $14.2 million over the balance of $233.2 million in floorplan payables as of January 31, 2017. The Company had other indebtedness consisting of senior convertible notes and other long-term debt of $99.0 million as of January 31, 2018, which was a decrease of $29.1 million compared to the balance of $128.1 million as of January 31, 2017. The Company's ratio of total liabilities to tangible net worth was 1.4 as of January 31, 2018.
During fiscal 2018, the Company repurchased $30.1 million in face value amount of its senior convertible notes with $29.5 million in cash. The Company has retired $84.4 million, or approximately 56%, of the original face value amount of its senior convertible notes during fiscal 2017 and 2018 with $75.1 million in cash.
For the fiscal year ended January 31, 2018, the Company’s net cash provided by operating activities was $95.8 million. The Company evaluates its cash flow from operating activities net of all floorplan payable activity and maintaining a constant level of equity in its equipment inventory. Taking these adjustments into account, adjusted net cash provided by operating activities was $45.6 million for the fiscal year ended January 31, 2018, compared to $88.8 million for the fiscal year ended January 31, 2017.
Mr. Meyer concluded, "The stabilization we are experiencing in the Agriculture market both domestically and internationally, combined with our improved inventory condition and recently completed restructuring plan, have our Company well positioned for long-term profitable growth. I’m pleased to introduce a fiscal 2019 forecast that expects revenue growth across all segments, margin expansion, and positive diluted earnings per share."
Fiscal 2019 Modeling Assumptions
The following are the Company’s current expectations for certain fiscal 2019 modeling assumptions:
| Assumptions | |
| Segment Revenue | |
| Agriculture | Up 0-5% |
| Construction | Up 3-8% |
| International | Up 0-5% |
| Equipment Margin | 7.8 - 8.3% |
| Diluted EPS | $0.35 - $0.55 |
Conference Call Information
The Company will host a conference call and audio webcast today at 7:30 a.m. Central time (8:30 a.m. Eastern time). Investors interested in participating in the live call can dial (888) 882-4478 from the U.S. International callers can dial (323) 794-2149. A telephone replay will be available approximately two hours after the call concludes and will be available through Thursday, April 12, 2018, by dialing (844) 512-2921 from the U.S., or (412) 317-6671 from international locations, and entering confirmation code 8145301.
A copy of the presentation that will accompany the prepared remarks from the conference call is available on the Company’s website under Investor Relations at www.titanmachinery.com. An archive of the audio webcast will be available on the Company’s website under Investor Relations at www.titanmachinery.com for 30 days following the audio webcast.
Non-GAAP Financial Measures
Within this release, the Company refers to certain adjusted financial measures, which have directly comparable GAAP financial measures as identified in this release. The Company believes that non-GAAP financial measures, when reviewed in conjunction with GAAP financial measures, can provide more information to assist investors in evaluating current period performance and in assessing future performance. For these reasons, internal management reporting also includes non-GAAP measures. Generally, the non-GAAP measures include adjustments for items such as restructuring costs, long-lived asset impairment charges, gains recognized on the repurchase of senior convertible notes, gains recognized on insurance recoveries, foreign currency remeasurement losses in Ukraine, and other gains and losses. The non-GAAP financial measures should be considered in addition to, and not superior to or as a substitute for the GAAP financial measures presented in this release and the Company's financial statements and other publicly filed reports. Non-GAAP measures as presented herein may not be comparable to similarly titled measures used by other companies. Investors are encouraged to review the reconciliations of adjusted financial measures used in this release to their most directly comparable GAAP financial measures. These reconciliations are attached to this release. The tables included in the Non-GAAP Reconciliations section reconcile net income (loss) including noncontrolling interest, earnings (loss) per share – diluted, income (loss) before income taxes, and net cash provided by operating activities (all GAAP financial measures) for the periods presented to adjusted net income (loss) including noncontrolling interest, adjusted EBITDA (loss), adjusted earnings (loss) per share – diluted, adjusted income (loss) before income taxes, and adjusted net cash provided by (used for) operating activities (all non-GAAP financial measures) for the periods presented.
About Titan Machinery Inc.
Titan Machinery Inc., founded in 1980 and headquartered in West Fargo, North Dakota, is a leading global dealership with a network of full-service agriculture and construction stores. The network consists of US locations in North Dakota, South Dakota, Iowa, Minnesota, Montana, Nebraska, Wyoming, Wisconsin, Colorado, Arizona, and New Mexico, and European locations in Romania, Bulgaria, Serbia, and Ukraine. The Titan Machinery locations represent one or more of the CNH Industrial Brands, including Case IH, New Holland Agriculture, Case Construction, New Holland Construction, and CNH Capital. Additional information about Titan Machinery Inc. can be found at www.titanmachinery.com.
Forward Looking Statements
Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words “potential,” “believe,” “estimate,” “expect,” “intend,” “may,” “could,” “will,” “plan,” “anticipate,” and similar words and expressions are intended to identify forward-looking statements. Such statements are based upon the current beliefs and expectations of our management. Forward-looking statements made herein, which include statements regarding Agriculture, Construction, and International segment initiatives and improvements, segment revenue realization, growth and profitability expectations, inventory expectations, leverage expectations, agricultural and construction equipment industry conditions and trends, and modeling assumptions and expected results of operations for the fiscal year ending January 31, 2019, involve known and unknown risks and uncertainties that may cause Titan Machinery’s actual results in current or future periods to differ materially from the forecasted assumptions and expected results. The Company’s risks and uncertainties include, among other things, a substantial dependence on a single equipment supplier, the continued availability of organic growth and acquisition opportunities, potential difficulties integrating acquired stores, industry supply levels, fluctuating agriculture and construction industry economic conditions, the success of recently implemented initiatives within the Company’s operating segments, the uncertainty and fluctuating conditions in the capital and credit markets, difficulties in conducting international operations, foreign currency risks, governmental agriculture policies, seasonal fluctuations, the ability of the Company to reduce inventory levels, climate conditions, disruption in receiving ample inventory financing, and increased competition in the geographic areas served. These and other risks are more fully described in Titan Machinery’s filings with the Securities and Exchange Commission, including the Company’s most recently filed Annual Report on Form 10-K, as updated in subsequently filed Quarterly Reports on Form 10-Q, as applicable. Titan Machinery conducts its business in a highly competitive and rapidly changing environment. Accordingly, new risk factors may arise. It is not possible for management to predict all such risk factors, nor to assess the impact of all such risk factors on Titan Machinery’s business or the extent to which any individual risk factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. Other than required by law, Titan Machinery disclaims any obligation to update such factors or to publicly announce results of revisions to any of the forward-looking statements contained herein to reflect future events or developments.
Investor Relations Contact:
ICR, Inc.
John Mills, jmills@icrinc.com
Partner
646-277-1254
| TITAN MACHINERY INC. | ||||||||||||||||||
| Consolidated Balance Sheets | ||||||||||||||||||
| (in thousands) | ||||||||||||||||||
| (Unaudited) | ||||||||||||||||||
| January 31, 2018 | January 31, 2017 | |||||||||||||||||
| Assets | ||||||||||||||||||
| Current Assets | ||||||||||||||||||
| Cash | $ | 53,396 | $ | 53,151 | ||||||||||||||
| Receivables (net of allowance of $2,951 and $3,630 as of January 31, 2018 and January 31, 2017, respectively) | 60,672 | 60,082 | ||||||||||||||||
| Inventories | 472,467 | 478,266 | ||||||||||||||||
| Prepaid expenses and other | 12,440 | 10,989 | ||||||||||||||||
| Income taxes receivable | 171 | 5,380 | ||||||||||||||||
| Total current assets | 599,146 | 607,868 | ||||||||||||||||
| Noncurrent Assets | ||||||||||||||||||
| Intangible assets, net of accumulated amortization | 5,193 | 5,001 | ||||||||||||||||
| Property and Equipment, net of accumulated depreciation | 151,047 | 156,647 | ||||||||||||||||
| Deferred income taxes | 3,472 | 547 | ||||||||||||||||
| Other | 1,450 | 1,359 | ||||||||||||||||
| Total noncurrent assets | 161,162 | 163,554 | ||||||||||||||||
| Total Assets | 760,308 | 771,422 | ||||||||||||||||
| Liabilities and Stockholders' Equity | ||||||||||||||||||
| Current Liabilities | ||||||||||||||||||
| Accounts payable | 15,136 | 17,326 | ||||||||||||||||
| Floorplan payable | 247,392 | 233,228 | ||||||||||||||||
| Current maturities of long-term debt | 1,574 | 1,373 | ||||||||||||||||
| Customer deposits | 32,324 | 26,366 | ||||||||||||||||
| Accrued expenses and other | 31,863 | 30,533 | ||||||||||||||||
| Total current liabilities | 328,289 | 308,826 | ||||||||||||||||
| Long-Term Liabilities | ||||||||||||||||||
| Senior convertible notes | 62,819 | 88,501 | ||||||||||||||||
| Long-term debt, less current maturities | 34,578 | 38,236 | ||||||||||||||||
| Deferred income taxes | 2,275 | 9,500 | ||||||||||||||||
| Other long-term liabilities | 10,492 | 5,180 | ||||||||||||||||
| Total long-term liabilities | 110,164 | 141,417 | ||||||||||||||||
| Stockholders' Equity | ||||||||||||||||||
| Additional paid-in-capital | 246,509 | 240,615 | ||||||||||||||||
| Retained earnings | 77,046 | 85,347 | ||||||||||||||||
| Accumulated other comprehensive loss | (1,700) | (4,783) | ||||||||||||||||
| Total stockholders' equity | 321,855 | 321,179 | ||||||||||||||||
| Total Liabilities and Stockholders' Equity | $ | 760,308 | $ | 771,422 | ||||||||||||||
| TITAN MACHINERY INC. | ||||||||||||||||||||||||||||||||||||||||||||||
| Consolidated Statements of Operations | ||||||||||||||||||||||||||||||||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended January 31, | Twelve Months Ended January 31, | |||||||||||||||||||||||||||||||||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||||||||||||||||||||||||
| Revenue | ||||||||||||||||||||||||||||||||||||||||||||||
| Equipment | $ | 252,609 | $ | 226,946 | $ | 804,361 | $ | 797,315 | ||||||||||||||||||||||||||||||||||||||
| Parts | 45,512 | 48,713 | 222,404 | 233,819 | ||||||||||||||||||||||||||||||||||||||||||
| Service | 26,511 | 28,011 | 117,318 | 124,076 | ||||||||||||||||||||||||||||||||||||||||||
| Rental and other | 14,976 | 13,951 | 58,855 | 57,870 | ||||||||||||||||||||||||||||||||||||||||||
| Total Revenue | 339,608 | 317,621 | 1,202,938 | 1,213,080 | ||||||||||||||||||||||||||||||||||||||||||
| Cost of Revenue | ||||||||||||||||||||||||||||||||||||||||||||||
| Equipment | 234,065 | 213,799 | 743,465 | 746,169 | ||||||||||||||||||||||||||||||||||||||||||
| Parts | 31,587 | 34,014 | 156,455 | 164,020 | ||||||||||||||||||||||||||||||||||||||||||
| Service | 10,764 | 10,811 | 44,141 | 46,284 | ||||||||||||||||||||||||||||||||||||||||||
| Rental and other | 11,095 | 10,175 | 43,577 | 42,878 | ||||||||||||||||||||||||||||||||||||||||||
| Total Cost of Revenue | 287,511 | 268,799 | 987,638 | 999,351 | ||||||||||||||||||||||||||||||||||||||||||
| Gross Profit | 52,097 | 48,822 | 215,300 | 213,729 | ||||||||||||||||||||||||||||||||||||||||||
| Operating Expenses | 50,319 | 52,240 | 203,203 | 211,372 | ||||||||||||||||||||||||||||||||||||||||||
| Impairment of Long-Lived Assets | 673 | 4,135 | 673 | 4,410 | ||||||||||||||||||||||||||||||||||||||||||
| Restructuring Costs | 19 | 48 | 10,499 | 319 | ||||||||||||||||||||||||||||||||||||||||||
| Income (Loss) from Operations | 1,086 | (7,601) | 925 | (2,372) | ||||||||||||||||||||||||||||||||||||||||||
| Other Income (Expense) | ||||||||||||||||||||||||||||||||||||||||||||||
| Interest income and other income (expense) | (205) | 273 | 1,635 | 1,524 | ||||||||||||||||||||||||||||||||||||||||||
| Floorplan interest expense | (1,433) | (2,717) | (8,152) | (13,560) | ||||||||||||||||||||||||||||||||||||||||||
| Other interest expense | (2,153) | (2,375) | (8,847) | (8,305) | ||||||||||||||||||||||||||||||||||||||||||
| Loss Before Income Taxes | (2,705) | (12,420) | (14,439) | (22,713) | ||||||||||||||||||||||||||||||||||||||||||
| Benefit from Income Taxes | (4,390) | (4,181) | (7,390) | (8,178) | ||||||||||||||||||||||||||||||||||||||||||
| Net Income (Loss) Including Noncontrolling Interest | 1,685 | (8,239) | (7,049) | (14,535) | ||||||||||||||||||||||||||||||||||||||||||
| Less: Net Loss Attributable to Noncontrolling Interest | — | — | — | (356) | ||||||||||||||||||||||||||||||||||||||||||
| Net Income (Loss) Attributable to Titan Machinery Inc. | $ | 1,685 | $ | (8,239) | $ | (7,049) | $ | (14,179) | ||||||||||||||||||||||||||||||||||||||
| Net Income (Loss) Allocated to Participating Securities | (33) | 190 | 141 | 243 | ||||||||||||||||||||||||||||||||||||||||||
| Net Income (Loss) Attributable to Titan Machinery Inc. Common Stockholders | $ | 1,652 | $ | (8,049) | $ | (6,908) | $ | (13,936) | ||||||||||||||||||||||||||||||||||||||
| Diluted Earnings (Loss) per Share | 0.08 | (0.38) | (0.32) | (0.65) | ||||||||||||||||||||||||||||||||||||||||||
| Diluted Weighted Average Common Shares | 21,682 | 21,342 | 21,543 | 21,294 | ||||||||||||||||||||||||||||||||||||||||||
| TITAN MACHINERY INC. | ||||||||||||||||||||||
| Consolidated Condensed Statements of Cash Flows | ||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||
| Year Ended January 31, | ||||||||||||||||||||||
| 2018 | 2017 | |||||||||||||||||||||
| Operating Activities | ||||||||||||||||||||||
| Net loss including noncontrolling interest | $ | (7,049) | $ | (14,535) | ||||||||||||||||||
| Adjustments to reconcile net loss including noncontrolling interest to net cash provided by (used for) operating activities | ||||||||||||||||||||||
| Depreciation and amortization | 25,105 | 26,868 | ||||||||||||||||||||
| Impairment | 673 | 4,410 | ||||||||||||||||||||
| Deferred income taxes | (8,920) | (2,841) | ||||||||||||||||||||
| Other, net | 4,664 | 3,404 | ||||||||||||||||||||
| Changes in assets and liabilities | ||||||||||||||||||||||
| Inventories | 20,338 | 211,793 | ||||||||||||||||||||
| Manufacturer floorplan payable | 46,141 | (95,341) | ||||||||||||||||||||
| Other working capital | 14,860 | 7,239 | ||||||||||||||||||||
| Net Cash Provided by Operating Activities | 95,812 | 140,997 | ||||||||||||||||||||
| Investing Activities | ||||||||||||||||||||||
| Property and equipment purchases | (26,115) | (12,425) | ||||||||||||||||||||
| Proceeds from sale of property and equipment | 5,030 | 2,388 | ||||||||||||||||||||
| Other, net | (3,504) | 912 | ||||||||||||||||||||
| Net Cash Used for Investing Activities | (24,589) | (9,125) | ||||||||||||||||||||
| Financing Activities | ||||||||||||||||||||||
| Net change in non-manufacturer floorplan payable | (38,626) | (116,558) | ||||||||||||||||||||
| Repurchase of Senior Convertible Notes | (29,093) | (46,013) | ||||||||||||||||||||
| Net proceeds from (payments on) long-term debt borrowings | (3,785) | (3,190) | ||||||||||||||||||||
| Other, net | 38 | (2,215) | ||||||||||||||||||||
| Net Cash Used for Financing Activities | (71,466) | (167,976) | ||||||||||||||||||||
| Effect of Exchange Rate Changes on Cash | 488 | (210) | ||||||||||||||||||||
| Net Change in Cash | 245 | (36,314) | ||||||||||||||||||||
| Cash at Beginning of Period | 53,151 | 89,465 | ||||||||||||||||||||
| Cash at End of Period | $ | 53,396 | $ | 53,151 | ||||||||||||||||||
| TITAN MACHINERY INC. | ||||||||||||||||||||||||||||||
| Segment Results | ||||||||||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||
| Three Months Ended January 31, | Twelve Months Ended January 31, | |||||||||||||||||||||||||||||
| 2018 | 2017 | % Change | 2018 | 2017 | % Change | |||||||||||||||||||||||||
| Revenue | ||||||||||||||||||||||||||||||
| Agriculture | $ | 205,308 | $ | 201,107 | 2.1% | $ | 694,025 | $ | 739,167 | (6.1)% | ||||||||||||||||||||
| Construction | 85,767 | 81,703 | 5.0% | 300,019 | 323,625 | (7.3)% | ||||||||||||||||||||||||
| International | 48,533 | 34,811 | 39.4% | 208,894 | 150,288 | 39.0% | ||||||||||||||||||||||||
| Total | $ | 339,608 | $ | 317,621 | 6.9% | $ | 1,202,938 | $ | 1,213,080 | (0.8)% | ||||||||||||||||||||
| Income (Loss) Before Income Taxes | ||||||||||||||||||||||||||||||
| Agriculture | $ | 2,192 | $ | (5,900) | 137.2% | $ | (3,678) | $ | (15,781) | 76.7% | ||||||||||||||||||||
| Construction | (3,202) | (4,352) | 26.4% | (7,278) | (5,875) | (23.9)% | ||||||||||||||||||||||||
| International | (1,126) | (381) | (195.5)% | 2,205 | (469) | N/M | ||||||||||||||||||||||||
| Segment income (loss) before income taxes | (2,136) | (10,633) | 79.9% | (8,751) | (22,125) | 60.4% | ||||||||||||||||||||||||
| Shared Resources | (569) | (1,787) | 68.2% | (5,688) | (588) | N/M | ||||||||||||||||||||||||
| Total | $ | (2,705) | $ | (12,420) | 78.2% | $ | (14,439) | $ | (22,713) | 36.4% | ||||||||||||||||||||
| TITAN MACHINERY INC. | ||||||||||||||||||||||||||||||||||||||||||||||
| Non-GAAP Reconciliations | ||||||||||||||||||||||||||||||||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended January 31, | Twelve Months Ended January 31, | |||||||||||||||||||||||||||||||||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||||||||||||||||||||||||
| Net Income (Loss) Including Noncontrolling Interest | ||||||||||||||||||||||||||||||||||||||||||||||
| Net Income (Loss) Including Noncontrolling Interest | $ | 1,685 | $ | (8,239) | $ | (7,049) | $ | (14,535) | ||||||||||||||||||||||||||||||||||||||
| Adjustments | ||||||||||||||||||||||||||||||||||||||||||||||
| Impairment of Long-Lived Assets | 542 | 4,135 | 673 | 4,410 | ||||||||||||||||||||||||||||||||||||||||||
| Gain on Repurchase of Senior Convertible Notes | — | — | (22) | (3,130) | ||||||||||||||||||||||||||||||||||||||||||
| Debt Issuance Cost Write-Off | — | — | 416 | 624 | ||||||||||||||||||||||||||||||||||||||||||
| Restructuring Costs | 150 | 48 | 10,499 | 319 | ||||||||||||||||||||||||||||||||||||||||||
| Ukraine Remeasurement (1) | — | — | — | 195 | ||||||||||||||||||||||||||||||||||||||||||
| Interest Rate Swap Termination & Reclassification | — | — | 631 | — | ||||||||||||||||||||||||||||||||||||||||||
| Gain on Insurance Recoveries | — | (1,411) | — | (1,997) | ||||||||||||||||||||||||||||||||||||||||||
| Total Pre-Tax Adjustments | 692 | 2,772 | 12,197 | 421 | ||||||||||||||||||||||||||||||||||||||||||
| Less: Tax Effect of Adjustments (2) | 233 | 1,056 | 4,103 | (6 | ) | |||||||||||||||||||||||||||||||||||||||||
| Less: Tax Benefit from Tax Act | 1,809 | — | 1,809 | — | ||||||||||||||||||||||||||||||||||||||||||
| Plus: Income Tax Valuation Allowance (3) | (2,446) | 44 | (1,920) | 44 | ||||||||||||||||||||||||||||||||||||||||||
| Total Adjustments | (3,795) | 1,672 | 4,365 | 383 | ||||||||||||||||||||||||||||||||||||||||||
| Adjusted Net Loss Including Noncontrolling Interest | $ | (2,110) | $ | (6,567) | $ | (2,684) | $ | (14,152) | ||||||||||||||||||||||||||||||||||||||
| Diluted Earnings (Loss) per Share - Diluted | ||||||||||||||||||||||||||||||||||||||||||||||
| Earnings (Loss) per Share - Diluted | $ | 0.08 | $ | (0.38) | $ | (0.32) | $ | (0.65) | ||||||||||||||||||||||||||||||||||||||
| Adjustments (4) | ||||||||||||||||||||||||||||||||||||||||||||||
| Impairment of Long-Lived Assets | 0.02 | 0.19 | 0.03 | 0.20 | ||||||||||||||||||||||||||||||||||||||||||
| Gain on Repurchase of Senior Convertible Notes | — | — | — | (0.15) | ||||||||||||||||||||||||||||||||||||||||||
| Debt Issuance Cost Write-Off | — | — | 0.02 | 0.03 | ||||||||||||||||||||||||||||||||||||||||||
| Restructuring Costs | 0.01 | — | 0.48 | 0.01 | ||||||||||||||||||||||||||||||||||||||||||
| Ukraine Remeasurement (1) | — | — | — | 0.01 | ||||||||||||||||||||||||||||||||||||||||||
| Interest Rate Swap Termination & Reclassification | — | — | 0.03 | — | ||||||||||||||||||||||||||||||||||||||||||
| Gain on Insurance Recoveries | — | (0.07) | — | (0.10) | ||||||||||||||||||||||||||||||||||||||||||
| Total Pre-Tax Adjustments | 0.03 | 0.12 | 0.56 | — | ||||||||||||||||||||||||||||||||||||||||||
| Less: Tax Effect of Adjustments (2) | 0.01 | 0.05 | 0.19 | — | ||||||||||||||||||||||||||||||||||||||||||
| Less: Tax Benefit of Tax Act | 0.08 | — | 0.08 | — | ||||||||||||||||||||||||||||||||||||||||||
| Plus: Income Tax Valuation Allowance (3) | (0.12) | — | (0.09) | — | ||||||||||||||||||||||||||||||||||||||||||
| Total Adjustments | (0.18) | 0.07 | 0.20 | — | ||||||||||||||||||||||||||||||||||||||||||
| Adjusted Loss per Share - Diluted | $ | (0.10) | $ | (0.31) | $ | (0.12) | $ | (0.65) | ||||||||||||||||||||||||||||||||||||||
| TITAN MACHINERY INC. | ||||||||||||||||||||||||||||||||||||||||||||||
| Non-GAAP Reconciliations | ||||||||||||||||||||||||||||||||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended January 31, | Twelve Months Ended January 31, | |||||||||||||||||||||||||||||||||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||||||||||||||||||||||||
| Income (Loss) Before Income Taxes | ||||||||||||||||||||||||||||||||||||||||||||||
| Loss Before Income Taxes | $ | (2,705) | $ | (12,420) | $ | (14,439) | $ | (22,713) | ||||||||||||||||||||||||||||||||||||||
| Adjustments | ||||||||||||||||||||||||||||||||||||||||||||||
| Impairment of Long-Lived Assets | 542 | 4,135 | 673 | 4,410 | ||||||||||||||||||||||||||||||||||||||||||
| Gain on Repurchase of Senior Convertible Notes | — | — | (22) | (3,130) | ||||||||||||||||||||||||||||||||||||||||||
| Debt Issuance Cost Write-Off | — | — | 416 | 624 | ||||||||||||||||||||||||||||||||||||||||||
| Restructuring Costs | 150 | 48 | 10,499 | 319 | ||||||||||||||||||||||||||||||||||||||||||
| Ukraine Remeasurement (1) | — | — | — | 195 | ||||||||||||||||||||||||||||||||||||||||||
| Interest Rate Swap Termination & Reclassification | — | — | 631 | — | ||||||||||||||||||||||||||||||||||||||||||
| Gain on Insurance Recoveries | — | (1,411) | — | (1,997) | ||||||||||||||||||||||||||||||||||||||||||
| Total Adjustments | 692 | 2,772 | 12,197 | 421 | ||||||||||||||||||||||||||||||||||||||||||
| Adjusted Loss Before Income Taxes | $ | (2,013) | $ | (9,648) | $ | (2,242) | $ | (22,292) | ||||||||||||||||||||||||||||||||||||||
| Income (Loss) Before Income Taxes - Agriculture | ||||||||||||||||||||||||||||||||||||||||||||||
| Income (Loss) Before Income Taxes | $ | 2,192 | $ | (5,900) | $ | (3,678) | $ | (15,781) | ||||||||||||||||||||||||||||||||||||||
| Adjustments | ||||||||||||||||||||||||||||||||||||||||||||||
| Impairment of Long-Lived Assets | 44 | 1,821 | 175 | 1,930 | ||||||||||||||||||||||||||||||||||||||||||
| Restructuring Costs | (221) | — | 6,887 | (120) | ||||||||||||||||||||||||||||||||||||||||||
| Gain on Insurance Recoveries | — | (761) | — | (1,347) | ||||||||||||||||||||||||||||||||||||||||||
| Total Adjustments | (177) | 1,060 | 7,062 | 463 | ||||||||||||||||||||||||||||||||||||||||||
| Adjusted Income (Loss) Before Income Taxes | $ | 2,015 | $ | (4,840) | $ | 3,384 | $ | (15,318) | ||||||||||||||||||||||||||||||||||||||
| Income (Loss) Before Income Taxes - Construction | ||||||||||||||||||||||||||||||||||||||||||||||
| Loss Before Income Taxes | $ | (3,202 | ) | $ | (4,352) | $ | (7,278) | $ | (5,875) | |||||||||||||||||||||||||||||||||||||
| Adjustments | ||||||||||||||||||||||||||||||||||||||||||||||
| Impairment of Long-Lived Assets | 498 | 1,989 | 498 | 2,155 | ||||||||||||||||||||||||||||||||||||||||||
| Restructuring Costs | 83 | 48 | 2,092 | 61 | ||||||||||||||||||||||||||||||||||||||||||
| Gain on Insurance Recoveries | — | (650) | — | (650) | ||||||||||||||||||||||||||||||||||||||||||
| Total Adjustments | 581 | 1,387 | 2,590 | 1,566 | ||||||||||||||||||||||||||||||||||||||||||
| Adjusted Loss Before Income Taxes | $ | (2,621) | $ | (2,965) | $ | (4,688) | $ | (4,309) | ||||||||||||||||||||||||||||||||||||||
| Income (Loss) Before Income Taxes - International | ||||||||||||||||||||||||||||||||||||||||||||||
| Income (Loss) Before Income Taxes | $ | (1,126) | $ | (381) | $ | 2,205 | $ | (469) | ||||||||||||||||||||||||||||||||||||||
| Adjustments | ||||||||||||||||||||||||||||||||||||||||||||||
| Impairment of Long-Lived Assets | — | 325 | — | 325 | ||||||||||||||||||||||||||||||||||||||||||
| Restructuring Costs | 2 | — | 62 | — | ||||||||||||||||||||||||||||||||||||||||||
| Ukraine Remeasurement (1) | — | — | — | 195 | ||||||||||||||||||||||||||||||||||||||||||
| Total Adjustments | 2 | 325 | 62 | 520 | ||||||||||||||||||||||||||||||||||||||||||
| Adjusted Income (Loss) Before Income Taxes | $ | (1,124) | $ | (56) | $ | 2,267 | $ | 51 | ||||||||||||||||||||||||||||||||||||||
| TITAN MACHINERY INC. | ||||||||||||||||||||||||||||||||||||||||||||||
| Non-GAAP Reconciliations | ||||||||||||||||||||||||||||||||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended January 31, | Twelve Months Ended January 31, | |||||||||||||||||||||||||||||||||||||||||||||
| EBITDA (Loss) | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||||||||||||||||||||||||||||
| Net Income (Loss) Including Noncontrolling Interest | $ | 1,685 | $ | (8,239) | $ | (7,049) | $ | (14,535) | ||||||||||||||||||||||||||||||||||||||
| Adjustments | ||||||||||||||||||||||||||||||||||||||||||||||
| Interest Expense, Net of Interest Income | 2,003 | (1,466) | 7,935 | 7,112 | ||||||||||||||||||||||||||||||||||||||||||
| Benefit from Income Taxes | (4,390) | (4,181) | (7,390) | (8,178) | ||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization | 6,156 | 6,972 | 25,105 | 26,868 | ||||||||||||||||||||||||||||||||||||||||||
| EBITDA (Loss) | 5,454 | (6,914) | 18,601 | 11,267 | ||||||||||||||||||||||||||||||||||||||||||
| Adjustments | ||||||||||||||||||||||||||||||||||||||||||||||
| Impairment of Long-Lived Assets | 542 | 4,135 | 673 | 4,410 | ||||||||||||||||||||||||||||||||||||||||||
| Gain on Repurchase of Senior Convertible Notes | — | — | (22) | (3,130) | ||||||||||||||||||||||||||||||||||||||||||
| Debt Issuance Cost Write-Off | — | — | 416 | 624 | ||||||||||||||||||||||||||||||||||||||||||
| Restructuring Costs | 150 | 48 | 10,499 | 319 | ||||||||||||||||||||||||||||||||||||||||||
| Ukraine Remeasurement (1) | — | — | — | 195 | ||||||||||||||||||||||||||||||||||||||||||
| Interest Rate Swap Termination & Reclassification | — | — | 631 | — | ||||||||||||||||||||||||||||||||||||||||||
| Gain on Insurance Recoveries | — | (1,411) | — | (1,997) | ||||||||||||||||||||||||||||||||||||||||||
| Total Adjustments | 692 | 2,772 | 12,197 | 421 | ||||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA (Loss) | $ | 6,146 | $ | (4,142) | $ | 30,798 | $ | 11,688 | ||||||||||||||||||||||||||||||||||||||
| Twelve Months Ended January 31, | ||||||||||||||||||||||||||||||||||||||||||||||
| Net Cash Provided By Operating Activities | 2018 | 2017 | ||||||||||||||||||||||||||||||||||||||||||||
| Net Cash Provided by Operating Activities | $ | 95,812 | $ | 140,997 | ||||||||||||||||||||||||||||||||||||||||||
| Adjustment for Non-Manufacturer Floorplan Net Payments | (38,626) | (116,558) | ||||||||||||||||||||||||||||||||||||||||||||
| Adjustment for Constant Equity in Equipment Inventory | $ | (11,603) | $ | 64,400 | ||||||||||||||||||||||||||||||||||||||||||
| Adjusted Net Cash Provided By Operating Activities | $ | 45,583 | $ | 88,839 | ||||||||||||||||||||||||||||||||||||||||||
| (1) Beginning in the second quarter of fiscal 2017 we discontinued incorporating Ukraine remeasurement losses into our adjusted income (loss) and earnings (loss) per share calculations. The Ukrainian hryvnia remained relatively stable subsequent to April 30, 2016 and therefore did not significantly impact our consolidated statement of operations during this period. Absent any future significant hryvnia volatility and resulting financial statement impact, we will not include Ukraine remeasurement losses in our adjusted amounts in future periods. | ||||||||||||||||||||||||||||||||||||||||||||||
| (2) The tax effect of adjustments was calculated using a 33.8% tax rate for the fiscal year ended January 31, 2018 and a 35.0% tax rate for the fiscal year ended January 31, 2017 for all U.S. related items, which was determined based on the federal statutory rate applicable to the respective fiscal year and no impact for state taxes given our valuation allowance against state deferred tax assets. No tax effect was recognized for foreign related items as all adjustments occurred in foreign jurisdictions that have full valuation allowances on deferred tax assets. | ||||||||||||||||||||||||||||||||||||||||||||||
| (3) For all fiscal years, amounts reflect the initial valuation allowance recognized for all deferred tax assets for which no previous valuation allowance existed. In addition, for fiscal 2018, the amount includes the benefit recognized from the release of the valuation allowance on our Ukrainian deferred tax assets, net of the incremental valuation allowance recognized as a result of restructuring costs incurred in fiscal 2018. | ||||||||||||||||||||||||||||||||||||||||||||||
| (4) Adjustments are net of the impact of amounts attributable to noncontrolling interests and allocated to participating securities. | ||||||||||||||||||||||||||||||||||||||||||||||