|Down 25% on Friday...
CEO and Chairman, Maurice Taylor comments, "The third quarter for our end markets was worse than anyone forecasted. This was consistent with our large customers and competitors. We continue to be focused on what we can control. This can be seen in our third quarter results. Our Titan employees are dedicated to working very hard to lower manufacturing costs, improve quality and improve how we manage the company. While unfortunate, we continue to make the difficult decisions to reduce headcount as production continues to slow. In addition to our focus on reducing manufacturing costs, we are exploring wheel and tire designs to both reduce cost and improve performance.|
|Titan are stuck in between struggling miners, and struggling farmers - their biggest markets.
They are trying to diversify by bringing in low profile tyres for tractors (don't laugh), and also a tyre reclamation plant. It appears that these two areas could prove fruitful, but we need a little patience.They have also conducted a major streamlining throughout the corporation, which will no doubt prove effective if we see an upturn.
Just to prove their commitment to the plans, our Morris has bought some shares recently, and so has the new CEO.|
|Is there anything that will make the share price rise here or make the board of directors pay a decent dividend?
The board seems to spend the profits on empire building acquisitions that do nothing for the shareholders, only the board's egos.
I had Titan Europe and took the Titan International shares during the takeover. I had my doubts then about the wisdom of my decision and those doubts seem to be correct.
Does anyone have any good news or is this just another corporate gravy train for the directors?|
|Seems to be a bit of action at TWI;
In a Schedule 13D filing with the Securities and Exchange Commission, MHR said it believes Titan's shares are undervalued, and seeks "to engage in discussions with management and others concerning the business and operations of (Titan)."
According to C. Schon Williams, an analyst with BB&T Capital Markets, Titan's management team already has had initial conversations with MHR.
"For the time being, the fund (MHR) has yet to detail any specifics on the changes they would like to implement," he says. (BB&T Capital Markets is a division of Scott & Stringfellow Inc., a registered broker/dealer subsidiary of BB&T Corp.).
On its website, MHR Fund Management, which Williams describes as an "activist investor," says it takes "a highly differentiated, control-focused, private equity approach to investing in distressed and undervalued middle-market companies." It seeks to "exert control or significant influence on its portfolio companies," which it believes is "essential to preserving and creating value."
Not quite sure how it intends to create value but presumably they are thinking of a sale.|
|TWI said that Goodyear had to sort out the unions at their French factory before they could make an offer. There is an update on Goodyear's negotiations;
|It will be interesting to see how widely this reclamation can be wheeled out. The beauty of it is that the profits shouldn't be related to the other cycles that TWI is subject to.|
|Up 9% currently - market seems to like it even if SeekingAlpha is correct in stating the revenue and earnings numbers were a miss.|
|Yes rather remarkably remarkable. He has certainly pulled that rabbit out of a hat.
Needless to say the market likes it. The conference call is at 6pm and is webcast. There will no doubt be questions about it.|
|Interesting development - green carbon certs, csrbon credits, and a high-margin business recycling the tires...
"Tire Reclamation: Titan Mining Services ("TMS") has started Titan Tire
Reclamation Corp. ("TTRC"). TTRC will be working with Green Carbon who has
developed a pyrolysis process in which mining tires and belting can be put in
a reactor so that, when the process is completed, a 59R63 super giant tire
becomes 450 to 500 gallons of oil, approximately 4,000 pounds of carbon black
and approximately one ton of steel.
"Depending on the country TTRC is operating in, the Company will receive
carbon credits. In addition to the return on oil, carbon black and steel,
TTRC will be paid a fee. The first system is planned to go to the oil sands in
Alberta, Canada, and then Elk River Valley of B.C. Canada. We are planning
units for Elko, Nevada; Gillett, Wyoming; Chile and Australia. Titan has
plans to use the reclaimed carbon black in various tire products, which should
give Titan a green carbon certificate for tires we produce, even the reclaimed
steel counts. There's no question Titan Mining Services will be growing
worldwide in the next few years. As TMS expands, each location will have other
equity owners operating each facility.
"I know the first question is what would revenue be? The above gross revenue
at today's prices should be $250 million for the sites mentioned above. The
EBITDA should be between $75 and $100 million gross. Yes, the margins are
better turning the tires back into oil, carbon black and steel. Titan has been
working on this for the past three years and we will have our first reactor
running in June/July 2014.|
|(Seeking Alpha) Titan Intl misses by $0.10, misses on revenue
Titan Intl (TWI): FQ2 EPS of $0.15 misses by $0.10.
Revenue of $497.5M (+22.9% Y/Y) misses by $36.49M. (PR)
Third quarter highlights:
o Sales for third quarter 2013 were $497.5 million up 22.9 percent, compared
to $404.7 million in the third quarter of 2012.
o Gross profit decreased 6.9 percent for third quarter 2013 to $62.5
million, or 12.6 percent of net sales, compared to $67.2 million in third
quarter 2012, or 16.6 percent of net sales.
o Third quarter income from operations was $17.1 million compared to $36.2
million last year.
o Adjusted net income for the third quarter was $8.1 million, compared to
$24.7 million in the third quarter of last year (see appendix below).
o Adjusted earnings per share for the third quarter 2013 are $0.15 and $0.15
for basic and fully diluted, respectively, compared to $0.59 and $0.49 for
2012, basic and fully diluted, respectively.
Statement of Chief Executive Officer:
Chairman and CEO, Maurice M. Taylor comments, "The third quarter has come and gone. Ag has held steady, earthmoving and construction declined and further decreases in raw material prices have impacted margins. Some people will say the glass is half full; others say it's half empty. I see the future for Titan as the best I've ever seen. Why? We have many opportunities on the horizon.
|Judging by the transcripts I think you would need an interpreter.
IIRC they said that they had 5 or 6 acquisitions in the pipeline which would add $500-1bn in revenue. The only one they have enacted so far is the Russian one with a t/o of $200m. I am not sure how much is attributable to TWI.|
|Sounds just the sort of guy we should get along to present at one of our Mello events lol|
|Zut alors! Quite a turn around from Grizz since his disparaging comments last year, Kimboy! And other European targets too - exciting times, assuming they can integrate them all painlessly.|
|It looks as though the ambitions are stretching beyond the Goodyear factory at Amiens;
Mr Taylor added that the company, which makes tyres for off-road vehicles, is also weighing bids for three additional plants in Europe in deals that would take its sales in the region from $750m in 2012 to to $1.3bn.
Perhaps it is a good time to be buying these type of outfits with valuations well down. However I feel that TWI haven't quite got on an even keel from their previous acquisitions. Then again when mining and construction recover TWI will be very well placed.
The conference call will be interesting.|
|More on France, and Russia;
|Seems as though our Dear Leader has had a change of heart on the French;
I hope, and expect, it is dirt cheap.|
|CAT Q3 report out today;
Basically mining has taken a hammering down 42% overall and 63% in Asia/Pacific. This is compared to 34% and 52% in Q2/13.
Interestingly they say that mining sales have been falling against a backdrop of strong mining production. No doubt this is exacerbated by inventories. However it would suggest that the situation is unsustainable and a strong bounce back may be apparent at some stage, though they are not forecasting it next year.
Anyhow bound to be affecting TWI even though a relatively small part of TWI's revenue.|
|For better or worse I still have a fair amount of TWI, well worse actually recently. On October 29th they have their Q3 figures announcement;
There will also be a webcast so we will be able to see if our Dear Leader really does speak pigeon English or whether the transcript writer has dyslexia.
They have been struggling against a backdrop of weak demand and prices and withdrew their earnings guidance in September;
This is clearly not good news in the short term at least. The present consensus is $0.25 for Q3/13 and $1.19 for the year. That is a long way down from where we were not 6 months ago.
Part of the problem is no doubt swallowing the acquisitions, however the Caterpillar retail statistics tell the underlying story;
Once things turn down they end up a the wrong end of an inventory cycle. However this operational leverage works in their favour once things turn around, as they surely will.
Anyway we shall see what the conference call brings.|
|Transcript of the conference call today;
I am afraid I am finding our Dear Leader's pigeon English ever more undecipherable. He seems to be just pulling words out of a hat.
Anyway I believe he is quite optimistic.|
|A bit on Russia but no real numbers;
There doesn't appear to have been any official announcement yet.|