Titan announces net loss, sales increase for 2Q

July 31, 2003

Titan International Inc. reported a net loss of $8.2 million on net sales of $131 million for the second quarter ended June 30. That compares to net income of $383,000 on net sales of $125.8 million for the same period last year.

Costs of approximately $3.4 million related to the consolidation of all its tire manufacturing into its principal facility in Des Moines, Iowa, affected second-quarter 2003 results. Higher raw material costs also had an impact.

For the first six months of the year, Titan posted a net loss of $14.1 million on net sales of $260 million. During the first six months of 2002, Titan suffered a net loss of $2.5 million on sales of $250 million.

"The North American large farm equipment market has been in a slump since 1998," says Titan CEO and president Morry Taylor Jr. "For example, in 1997, approximately 8,300 four-wheel drive tractors were sold. Last year, however, there were fewer than 3,300 sold.

"In terms of wheels and tires, that amounts to a decrease of more than 40,000 units."

Taylor says the recent farm bill has not significantly impacted equipment sales. Also, "additional pricing pressure from imports" has slowed growth. But he anticipates an increase in equipment sales in 2004.

As of the close of the New York Stock Exchange yesterday, Titan's stock was selling for $1.47 a share, compared to a 52-week high of $5.45 and low of $.60.