Titan International, Inc. (de) · NYSE:TWI
Titan International, Inc. (de) — Q3 2017 Earnings Presentation
37 slides from Titan International, Inc. (de)'s earnings presentation, Nov 1, 2017
Slide 1: Investor Presentation Q3 2017
Investor Presentation Q3 2017
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT: The accompanying material includes forward-looking comments and information concerning the company’s expectations and objectives for the future. Readers of this material should understand that these forward looking statements are based on the Company’s expectations and subject
Slide 3: Titan International Overview
Titan International Overview Titan International Inc. (TWI) is a publicly traded company on the New York Stock Exchange. Headquartered in the heartland of the U.S. in Quincy, Illinois, Titan has grown to become a top global manufacturer of specialty tires, wheels and tracks. Titan has a heritage
Slide 4: Titan International Overview: Strategy
Titan International Overview: Strategy To become the worldwide leader in manufacturing and distribution of wheels, tires, assemblies and undercarriage products and to serve our customers’ needs through product innovation and quality service in our key markets: Agriculture Earthmoving/Constructio
Slide 5: Titan International Overview: Portfolio
Titan International Overview: Portfolio COMPETITIVE ADVANTAGES TITAN/GOODYEAR MICHELIN BRIDGESTONE GKN 5
Slide 6: Titan International Overview: Customers
Titan International Overview: Customers 6
Slide 7: Titan International Overview: Global Footprint
Titan International Overview: Global Footprint Europe Ceprano, Italy Kidderminster, UK Fanano, Italy Monreal del Campo, Spain Finale Emilia, Italy Potenza, Italy Flers, France St. Helens, UK Gevelsburg, Germany Valsamoggia, Italy Jesi, Italy Volgograd, Russia North America
Slide 8: Agriculture
Slide 9: AGRICULTURE: Market Summary
AGRICULTURE: Market Summary Large hp equipment (4WD tractors and Combines) remain at historical lows. Smaller hp tractor demand remains strong, but at lower ASP and gross margins than larger equipment Grain prices remain low; resulting in lower farm income (stabilized somewhat beginning in 2016)
Slide 10: AGRICULTURE: Product Innovations
AGRICULTURE: Product Innovations 10
Slide 11: AGRICULTURE: Product Innovations
AGRICULTURE: Product Innovations 11
Slide 12: AGRICULTURE: Goodyear Expansion
AGRICULTURE: Goodyear Expansion 12
Slide 13: AGRICULTURE: Growth Opportunities
AGRICULTURE: Growth Opportunities 13
Slide 14: The Gayo N
The Gayo N S MINING
Slide 15: OTR: Market Summary
OTR: Market Summary Private construction spending for resi and non-resi buildings continue to carry the industry Larger construction equipment used for highways and infrastructure have remained slow to recover Overall mining activity remains lower with low commodity prices 15
Slide 16: OTR: Recent Highlight
OTR: Recent Highlight GRAND OPENING: TITAN TIRE RECLAMATION CORP (TTRC) March 29, 2016, was a groundbreaking day in more ways than one. The ribbon cutting at TTRC set in Sh motion the world's first completely sustainable ye Or71TANn recycling solution for giant OTR tires — effectively TIRE RECLAMATI
Slide 17: OTR: 23,000-Hour Giant Stands Out At Minexpo
OTR: 23,000-Hour Giant Stands Out At Minexpo 17
Slide 18: OTR: Product Innovations
OTR: Product Innovations TRIED AND TRUE: THE LEADERS IN BIAS Without a doubt, Titan produces some of the industry's best-performing, proven-in-the-field bias tires for construction and earthmoving. While we already have strong market share in bias, we have a vision for continuing to grow it. FOCUS O
Slide 19: OTR: Product Innovations
OTR: Product Innovations THE PREMIUM FORESTRY BRAND. Titan's dedication to improving product quality / “In my opinion, | think has paid off in the growing forestry segment. Goodyear is the best While several key competitors have experienced forestry tire on the market.” quality problems, Goodyear ha
Slide 20: OTR: ITM Innovations
OTR: ITM Innovations 1TM 2016 HIGHLIGHTS itt UNDERCARRIAGES | TRACKS | COMPONENTS | im Titan designed and produced a massive 120-ton custom undercarriage for a mining customerin > Morocco. INTRODUCING TRACKADVICE: INTELLIGENT TRACK MAINTENANCE * Ultrasonic measurement tool instantaneously calculates
Slide 21: Consumer
Slide 22: CONSUMER: Products Innovations
CONSUMER: Products Innovations 22
Slide 23: CONSUMER: Specialty Products Division
CONSUMER: Specialty Products Division 23
Slide 24: Financial Overview
Financial Overview O7ITAN oo
Slide 25: Financial Overview: Highlights & Challenges
Financial Overview: Highlights & Challenges Q3 Highlights Net sales increased $64.8 million to $371 million, up 21% year-over-year; the third consecutive quarter of significant YOY growth Gross profit increased $4.7 million or 14% YOY SG&A expenses were $39.8 million (10.7% of net sales); whil
Slide 26: Financial Overview: Q3 2017 by Market
Financial Overview: Q3 2017 by Market Agriculture: Tractors, combines, implements, irrigation Earthmoving/Construction: Mining, cranes, aerial lifts, haul trucks, scrapers Consumer: Primarily light-truck tires, ATVs and select golf and turf equipment markets Q3 2017 Segment Revenue GP: 14.2% ⬆ 23% v
Slide 27: Financial Overview: Sales and Gross Margin
Financial Overview: Sales and Gross Margin 50 % $2 30 45 % $211 $2 10 Net Sales: Up 23% Q3 ‘17 vs. Q3 ‘16 40 % $171 $1 90 35 % $1 70 Gross margin declined 234 basis points compared to Q3 ’16 30 % $140 $139 $1 50 25 % AG 46% $1 30 Improvements in both OEM and Aftermarket businesses 20 % $1 10 1
Slide 28: Financial Overview: Summary Income & EPS
Financial Overview: Summary Income & EPS (Amounts in millions) Q3 2017 Q3 2016 YTD 2017 YTD 2016 Sales $371.0 $306.2 $1,092.9 $958.2 Gross Margin $39.7 $34.9 $123.0 $106.9 Gross Margin % 10.7% 11.4% 11.3% 11.2% Operating Income (Loss) ($5.1) ($6.3) ($8.2) ($15.3) Operating Income % (1.4%) (2.1%) (0.
Slide 29: Financial Overview: Income Reconciliation
Financial Overview: Income Reconciliation Q3 2017 USD Amounts in Millions Q3 2017 Q3 2016 YTD 2017 YTD 2016 Net loss applicable to common shareholders (12.9) (9.4) (33.7) (32.5) Remove redemption value adjustment (0.9) (1.4) (4.0) (8.5) Net income (loss) attributable to Titan (12.0) (8.0) (29.8) (24
Slide 30: Financial Overview: EBITDA Reconciliation
Financial Overview: EBITDA Reconciliation Q3 2017 USD Amounts in Millions Q3 2017 Q3 2016 YTD 2017 YTD 2016 Net income (loss) (11.2) (9.0) (28.3) (25.1) Adjustments Provision for income taxes 2.4 (2.1) 6.0 2.6 Interest expense 7.5 8.7 22.6 25.2 Depreciation & amortization 14.5 14.3 44.0 44.9 EBITDA
Slide 31: Financial Appendix
Financial Appendix
Slide 32: Sales – N. America vs. International
Appendix Sales – N. America vs. International -12 Quarters -8 Quarters -4 Quarters Current Quarter Q3 - Sales / Operating Income (Amounts in Millions) $500 8% 6% $400 243 4% 223 $300 Millions 0.4% 2% -0.6% 164 186 $200 0% -2.1% 210 -2% $100 144 148 120 -4% $0 -5.0% -6% 2014 2015 2016 2017 Sales - N.
Slide 33: Working Capital
Appendix Working Capital Quarter 1 Quarter 2 Quarter 3 Quarter 4 Quarter 1 Quarter 2 Quarter 3 Quarter 4 Q3 - WORKING CAPITAL (Amounts in Millions) $700 28.3% 30% 25.6% 25.8% $600 25% 23.0% $500 20% 376 $400 331 Millions 293 15% 282 $300 10% $200 248 236 5% $100 207 184 184 184 128 152 $0 0% 2014 20
Slide 34: YTD Cash & CDs Activity
Appendix YTD Cash & CDs Activity September 2017 400.0 350.0 3.7 2.0 1.1 0.5 23.0 23.6 300.0 28.3 33.5 41.0 36.7 250.0 44.0 46.1 Millions 200.0 46.7 150.0 100.0 $197.8 $155.7 50.0 - 34
Slide 35: Debt Structure
Appendix Debt Structure CASH / DEBT Q3 '17 Q2 '17 Q1 '17 Q4 '16 Q3 '16 Cash & CDs $156 $153 $181 $198 $216 Total Debt $447 $451 $456 $506 $501 6.875% Secured Notes Due 2020 $396 $396 $396 $396 $396 Titan Europe Credit Facilities $34 $35 $36 $34 $37 Other $17 $20 $24 $76 $68 Net Leverage (Net Debt /
Slide 36: Cost Structure
Appendix Cost Structure Cost Structure Breakdown Primary Raw Materials Steel Overhead Natural Rubber 25% Raw Materials Synthetic Rubber 55% Labor Carbon Black 20% Nylon 36
Slide 37: Company Website: www.titan-intl.com
Company Website: www.titan-intl.com Investor Relations todd.shoot@titan-intl.com SAFE HARBOR STATEMENT: The accompanying material includes forward-looking comments and information concerning the company’s expectations and objectives for the future. Readers of this material should understand that the