Q4 2010 better than expected for Titan

Titan International returned to the black last year after recording a year-end net income of US$0.4 million, boosted by a final quarter that was, as described by company chairman and CEO Maurice M. Taylor Jr., “better than what we thought it was going to be.” In 2009 the United States based off-road tyre maker experienced a net loss of $24.6 million. Net income in this ‘better than expected’ fourth quarter amounted to $0.7 million; a year earlier Titan International made a loss of $30.7 million in the final quarter. Titan reached its annual net result on the back of sales of $881.6 million, a year-on-year increase of 21.1 per cent, and operational income of $40.9 million. Fourth quarter 2010 sales were $232.7 million, up 58.8 per cent year-on-year, while the quarter’s gross margin was up from a loss of $0.8 in 2009 to $26.0 million last year.

Explaining Titan’s better than anticipated performance, Taylor reflected that “farm demand is going strong and we believe it will go for a few more years. The mining business is coming up fast and we believe it has room to run and Titan has shown a lot of customers that our design of nylon cords over steel is a way to make better and safer OTR tyres.”

Another factor Taylor foresees as central to Titan’s growth is the decision to acquire Goodyear’s agricultural tyre business in South America, Africa and Europe – including the large Russian and Ukrainian markets. “We believe Titan can grow the revenue of these businesses to between $400 and $600 million per year in the next three years.  We expect to close on this transaction in two pieces – South America by end of March or April 1st this year and Europe sometime late summer or early fall.” Taylor added: “With these acquisitions my goal I gave to senior management of $950 million to $1.1 billion is too low. So, in April or 1st of May I will make public the new higher goals.