Titan Machinery misses by $0.21, misses on revs; guides FY14 EPS below consensus, revs in-line
Reports Q3 (Oct) earnings of $0.27 per share, $0.21 worse than the Capital IQ Consensus Estimate of $0.48; revenues rose 1.0% year/year to $588 mln vs the $612.89 mln consensus.
Margins: Gross profit for the third quarter of fiscal 2014 was $93.6 million, compared to $94.1 million in the third quarter last year. The Company's gross profit margin was 15.9% in the third quarter of fiscal 2014, compared to 16.2% in the third quarter last year. Gross profit from parts and service for the third quarter of fiscal 2014 was 55% of overall gross profit and increased to $51.7 million from $44.6 million in the third quarter last year. Solid performance from parts and service was offset by lower equipment sales and margins.
Guidance: Co issues downside guidance for FY14, sees EPS of $0.55-0.75 vs. $1.29 Capital IQ Consensus Estimate compared to the previous range $1.20-1.50; sees FY14 revs of $2.15-2.35 bln vs. $2.34 bln Capital IQ Consensus Estimate. compared to the previous range of $2.25-2.45 bln
Commentary: "Our third quarter financial results reflect the continuation of challenges in both the agriculture and construction industries that we have previously discussed. In the third quarter, our higher margin parts and services business performed well but was offset by lower agriculture equipment sales and lower equipment margins due to pricing pressure in both industries. We are making progress with our construction initiatives and are optimistic about the long-term potential of this segment, but it is taking longer than we expected for this to translate into improved financial results given the current challenges in this industry."
Margins: Gross profit for the third quarter of fiscal 2014 was $93.6 million, compared to $94.1 million in the third quarter last year. The Company's gross profit margin was 15.9% in the third quarter of fiscal 2014, compared to 16.2% in the third quarter last year. Gross profit from parts and service for the third quarter of fiscal 2014 was 55% of overall gross profit and increased to $51.7 million from $44.6 million in the third quarter last year. Solid performance from parts and service was offset by lower equipment sales and margins.
Guidance: Co issues downside guidance for FY14, sees EPS of $0.55-0.75 vs. $1.29 Capital IQ Consensus Estimate compared to the previous range $1.20-1.50; sees FY14 revs of $2.15-2.35 bln vs. $2.34 bln Capital IQ Consensus Estimate. compared to the previous range of $2.25-2.45 bln
Commentary: "Our third quarter financial results reflect the continuation of challenges in both the agriculture and construction industries that we have previously discussed. In the third quarter, our higher margin parts and services business performed well but was offset by lower agriculture equipment sales and lower equipment margins due to pricing pressure in both industries. We are making progress with our construction initiatives and are optimistic about the long-term potential of this segment, but it is taking longer than we expected for this to translate into improved financial results given the current challenges in this industry."