Statement of Chief Executive Officer: 

"The second quarter was a record for Titan, but it could have been even bigger," announced Maurice M. Taylor, Chairman and CEO. "The order books are very strong. The tire group was affected by the record heat wave and it impacted our efficiency. The Bryan plant was also affected by the equipment being added to the plant for the capacity expansion. The work has been in process since the beginning of the year and will continue through the remaining of 2012. This capacity expansion should increase our output each quarter through the first quarter of 2013. 

"Our balance sheet is in good shape with working capital equal to approximately $480 million and cash debt of $208 million, considering the $112 million convertible notes have a conversion price of $10.75. This is the hidden value of the company to our shareholders in addition to today's value of the plants and equipment." 

Taylor relayed, "I have been visiting farms in North Dakota, Minnesota, Illinois, Michigan and Ohio and I believe the net income to farmers will be equal or greater than the record last year. 

"Why? If you ask a farmer the status of their corn crop, they will tell you it is hurting. They were expecting 185 to 200 bushels per acre but they will not get that this year. They may get 145 to 150 if this heat continues with no rain. 

"If you put the numbers to this at $5 a bushel for corn, that is $1,000 per acre on yields of 200, but at $8 a bushel at 150, that's $1,200 per acre. It is the same with soy beans. Those farmers with irrigation systems will be at record levels. Yes, there will be farmers who will lose their total crop, but they most likely have crop insurance. 

"There have been a few announcements on acquisitions that should close in the third quarter under certain government regulations. We are not permitted to talk about the details of these acquisitions or our future projections for these entities. 

"I believe Titan is on the correct course to strengthen this company for the shareholders and our employees. Once the governments remove the block out period, I will hold a conference call to provide more information and answer questions. 

"The mining group is moving ahead as fast as we can, and the future is very exciting. The new employees we have hired will continue to become more effective in the tire business. 

"We look forward to the second half of 2012." 

Year-to date summary: 

June 2012 year-to-date sales were $922.3 million, an increase of 35 percent, compared to $685.3 million in 2011.

Gross profit increased 45 percent for the six months ended June 30, 2012 to $175.4 million, compared to $120.6 million in 2011.

Income from operations for the first six months of 2012 was $139.6 million, compared to $71.3 million in 2011.

Year-to-date adjusted net income was $69.3 million, compared to $42.4 million in 2011.

Adjusted earnings per share year-to-date are $1.65 and $1.34 for basic and fully diluted respectively, compared to $1.03 and $0.84 for 2011, basic and fully diluted respectively.

To view complete report, click here. 

Comments