Equipment rental company and dealer Titan Machinery saw revenue from rental increase 7.69 percent to $26.6 million from last year’s $24.7 million. Despite the gain in rental, the company’s third quarter revenue declined 16.1 percent from last year’s $588 million to this year’s $493.1 million.
According to David Meyer, Titan’s chairman and CEO, the revenue decline was due mostly to the agricultural side of business for Titan.
“For our construction segment, we reported another quarter of improved financial results, including same-store sales growth over 10 percent, higher equipment margins and an improvement in pre-tax income,” Meyer said. “Our agricultural segment continues to face a number of industry headwinds as we have previously discussed, including lower commodity prices and lower projected net farm income.”
Titan also acquired some assets of Midland Equipment, Inc., consisting of one agriculture equipment store in Wayne, NE, which expanded Titan’s agriculture presence in the state. In its most recently reported fiscal year, Midland Equipment, Inc. generated revenue of approximately $4.5 million.
Meyer said the rebounding housing industry is a positive indicator for medium and light equipment product offerings.
He continued, “For our construction segment, we reported another quarter of improved financial results, including same-store sales growth over 10 percent, higher equipment margins, and an improvement in pre-tax income. Our results reflect the success of our operational initiatives and the realignment and consolidation of our construction segment earlier this year along with ongoing improvements in the overall industry. We remain confident that we have taken the necessary steps to position our construction segment for long-term growth and profitability. Our international segment continues to be impacted by geopolitical instability in Ukraine; however, we have implemented initiatives to improve this segment of our business and are encouraged by improving trends as compared to the second quarter of this fiscal year.
“Based on our year-to-date results and outlook for the final quarter, we are revising our annual guidance, as we expect that continued improvements to our construction segment will be offset by ongoing headwinds for our agriculture and international segments. We remain intensely focused on managing the controllable aspects of our business and expect a continued reduction in our inventory position and increased cash flow from operations in the fourth quarter."