Titan Machinery Inc. · NASDAQ:TITN
Titan Machinery — Q1 2025 Earnings Presentation
18 slides from Titan Machinery's earnings presentation, May 23, 2024
Slide 1: First Quarter FY2025 Earnings Conference Call
First Quarter FY2025 Earnings Conference Call May 23, 2024
Slide 2: Safe Harbor Statement
Safe Harbor Statement Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the federal securities laws. Statements about our beliefs and expectations and statements containing the words “may,” “could,” “would,” “should,” “believe,” “expect,” “antic
Slide 3: Financial Overview
Financial Overview ▪ First Quarter FY2025 Results • Revenue $628.7 Million • Pre-Tax Income $12.8 Million • Diluted EPS $0.41 ▪ Conference Call Discussion Points • Financial Results • Industry Overviews • Modeling Assumptions 3
Slide 4: Agriculture Segment Overview
Agriculture Segment Overview Q1 FY25 Recap • Same-store sales growth of 4.3% (versus +3.8% in prior year) ◦ Aided by pre-sale orders from prior year, improved equipment availability ◦ New order demand softened on weakening farmer sentiment ◦ Customer care strategy driving parts and service growth •
Slide 5: Construction Segment Overview
Construction Segment Overview Q1 FY25 Recap • Same-store sales relatively flat, down 0.7% YoY ◦ Seasonal demand for certain equipment & parts impacted by lower snowfall ◦ Underlying industry fundamentals remain stable • Equipment gross margin normalization, as anticipated, driven by high levels of i
Slide 6: Europe Segment Overview
Europe Segment Overview Q1 FY25 Recap • Same-store sales decline of 15.5% (decline of 13.4%, net of favorable foreign currency impact) ◦ Lower net farm income impacting new purchases • Winter crops healthy, supported by good moisture levels Rest of FY25 Expectations • Favorable comparisons in fiscal
Slide 7: Australia Segment Overview
Australia Segment Overview Q1 FY25 Recap • Revenues of $44 million USD ◦ YoY growth driven by improved equipment availability • Equipment gross margin normalization, as anticipated, driven by softening demand and high levels of inventory across the industry • Mixed start to the growing season with w
Slide 8: First Quarter Revenue Analysis
First Quarter Revenue Analysis (in millions of dollars) Q1 FY2025 Q1 FY2024 Change Total Revenue $628.7 $569.6 +10.4% Equipment $468.1 $429.4 +9.0% Parts $108.2 $96.6 +12.0% Service $45.1 $34.9 +29.0% Rental & Other $7.3 $8.7 -16.1% 8
Slide 9: First Quarter Financials
First Quarter Financials (in millions of dollars, except per share) Q1 FY2025 Q1 FY2024 Change Total Revenue $628.7 $569.6 +10.4% Gross Profit $121.8 $118.6 +2.7% Gross Profit Margin 19.4% 20.8% -140 bps Operating Expenses $99.2 $81.3 -21.9% Operating Expense as a % of Revenue 15.8% 14.3% +150bps Fl
Slide 10: First Quarter Segment Overview
First Quarter Segment Overview % of % of Change (in millions of dollars) Q1 FY2025 Q1 FY2024 Revenue Revenue ($) Revenue $628.7 $569.6 +10.4% Agriculture $447.7 $423.2 +5.8% Construction $71.5 $72.0 -0.7% Europe $65.1 $74.4 -12.5% Australia $44.4 N/A(2) N/A(2) Pre-Tax Income(1) $12.8 2.0% $35.4 6.2%
Slide 11: Balance Sheet Highlights
Balance Sheet Highlights ▪ $36 Million of Cash ▪ Equipment Inventory Increased $133 Million to $1.2 Billion as of April 30, 2024 vs. $1.1 Billion as of January 31, 2024 • $105 Million increase in new equipment and a $27 Million increase in used equipment ▪ Parts Inventory of $196 Million as of April
Slide 12: Equipment Inventory
Equipment Inventory (1) (1) Non-Interest Bearing floorplan is equipment that is in its initial interest free financing period from the OEM (2) Equity is equipment inventory not financed with floorplan (3) Inventory turns are calculated by dividing cost of sales on equipment for the last twelve month
Slide 13: FY2025 Outlook
FY2025 Outlook The following are the Company's current expectations for fiscal 2025 modeling assumptions. Previous Assumptions Current Assumptions Segment Revenue Agriculture Flat - Up 5% Down 2.5% - Up 2.5% Construction Up 3 - 8% Flat - Up 5% Europe Flat - Up 5% Down 5% - Flat Australia $250M - $27
Slide 14: Appendix
Appendix TITAN MACHINERY Power & Precision to Grow”
Slide 15: Operating Expenses & Absorption
(1) Operating Expenses & Absorption Operating Expenses Absorption Rate $500 90.0% $450 85.0% $400 82.2% 82.2% $350 79.2% 80.0% 77.7% $300 76.1% Millions Rate $250 75.0% 72.0% $200 70.0% $150 $100 65.0% $50 $— 60.0% FY20 FY21 FY22 FY23 FY24 TTM FY25 (1) Absorption is calculated in a given period by d
Slide 16: Same Store Results
Same Store Results(1) Three Months Ended April 30, Percent (in thousands of dollars) 2024 2023 Change Same Store Sales Agriculture $ 441,328 $ 423,196 4.3 % Construction $ 71,492 $ 71,997 (0.7)% Europe $ 62,919 $ 74,438 (15.5)% Total $ 575,739 $ 569,631 1.1 % Same Store Gross Profit Agriculture $ 81
Slide 17: Adjusted Debt to Tangible Net Worth
Adjusted Debt to Tangible Net Worth Adjusted Debt Tangible Net Worth Adjusted Debt to Tangible Net Worth 4.5 $1,200 $1,100 4.0 $1,000 3.5 $900 3.0 $800 $700 Millions 2.5 Ratio $600 2.0 $500 1.5 1.6 $400 1.5 1.0 1.0 $300 0.9 1.0 $200 0.5 $100 $— — Q4 FY21 Q4 FY22 Q4 FY23 Q4 FY24 Q1 FY25 (1) The debt
Slide 18: Non-GAAP Reconciliation Table
Non-GAAP Reconciliation Table Titan Machinery Inc. (in thousands) Three Months Ended April 30, 2024 2023 EBITDA Net Income $ 9,441 $ 26,965 Adjustments Interest expense, net of interest income 2,351 1,165 Provision for income taxes 3,345 8,474 Depreciation and amortization 8,715 6,948 EBITDA $ 23,85