Associated Press , Published September 05 2013
Titan Machinery posts mixed 2nd quarter results, trims viewWEST FARGO — Titan Machinery Inc.'s fiscal second-quarter net income declined 27 percent as operating expenses climbed.
The agricultural and construction equipment seller's quarterly earnings missed analysts' estimates, but its revenue topped Wall Street's view. The company also lowered its fiscal 2014 earnings and revenue forecasts due to difficulties facing the sectors it serves.
Shares fell in premarket trading on Thursday.
Titan earned $3.8 million, or 18 cents per share, for the three months ended July 31. Last year, it earned $5.2 million, or 25 cents per share.
Analysts, on average, expected earnings of 19 cents per share, according to FactSet.
Operating expenses climbed 24 percent to $70.1 million from $56.5 million.
Revenue increased 19 percent to $488.2 million from $410.1 million, with results improving in all business segments. Wall Street predicted $460.8 million in revenue.
Equipment sales and parts sales rose, while Titan also made more money from rentals and servicing equipment.
Chairman and CEO David Meyer said in a statement that the agriculture business will likely have a tougher time during the second half of the year, due to lower commodity prices and an expected drop in crop production. Meyer said Titan expects these factors to weigh on its customers, who will likely curtail their spending. This may lead to a drop in equipment revenue.
Titan now foresees full-year earnings of $1.20 to $1.50 per share, on revenue in a range of $2.25 billion to $2.45 billion. The West Fargo, N.D. company's prior guidance was for earnings of $1.70 to $2 per share, with revenue between $2.35 billion and $2.55 billion.
Analysts expect fiscal 2014 earnings of $1.79 per share on revenue of $2.37 billion.
Titan's stock dropped 87 cents, or 5.1 percent, to $16.25 before the opening bell. Shares closed Wednesday at $17.12, down 31 percent since the start of the year. The stock has traded in a range between $16.80 and $32 in the past 52 weeks, peaking in mid-February.
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