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CHICAGO, June 13, 2022 /PRNewswire/ -- Titan International, Inc. (NYSE: TWI) ("Titan" or "TWI") today released the following business update.
Last week, Titan's stockholders voted to support the Board's recommendations, with all ballot items receiving the majority of the proxy votes. Morry Taylor, TWI's Chairman of the Board of Directors, stated, "I appreciate the continued support from our stockholders and the recognition of the Company's success. I believe that our stockholders understand the progress we have made over the last several years. We will continue to engage and listen to our investors to get various viewpoints. As always, we invite anyone to come visit us at any of our facilities."
Morry Taylor concluded, "the Board met after the annual stockholders' meeting last week, and we are all struck by the strides that Titan has made over the last several years, but even more so, the outlook is getting stronger, as indicated by this release. I feel like there is nothing but bright skies ahead for TWI."
David Martin, Senior Vice President and Chief Financial Officer, commented, "the business climate continues to be strong for Titan, and our financial performance in the second quarter has exceeded expectations, and the outlook for the remainder of the year continues to be positive. As a result of our strong performance, it is important to update investors prior to the release of our second quarter earnings expected to be released in early August, that we are exceeding expectations. At this point, we expect second quarter sales to be at or exceeding the level of our first quarter sales, while our margins are expected to be stronger. For the full year, we now anticipate sales to be around $2.2 billion, with adjusted EBITDA between $225 million and $240 million, which will be our strongest performance in our history."
Paul Reitz, President and Chief Executive Officer further commented, "not only are we seeing strength in sales, but we are achieving solid flow through to our margins and bottom line, based on improved plant productivity and efficiency, and healthy product mix. Our Titan team continues to manage our supply chain effectively along with handling the unprecedented inflationary environment well. We believe that strength of our end-markets and our performance has a solid runway in front of us for the next couple of years, and this belief is supported by the numerous market factors in place, including high farm commodity prices, low equipment inventory levels, both new and used, and strong farmer balance sheets. Most importantly, the Ag sector should hold up despite the inflationary environment surrounding us, based on these and other fundamentals."
In addition, during the second quarter of 2022, the Company will report approximately $22 million in other income for non-income tax credits in Brazil, based on the formal approval from the Brazilian government this quarter. This matter relates to previously paid indirect taxes that were subject to successful legal claims, which was previously disclosed in the Company's first quarter 2022 10-Q. The cash flow from these tax credits is expected to be realized over the next two years. This positive cash flow will enable the Company to continue to reduce debt over time, and fund ongoing critical investments to advance the business. An additional $10 million in tax credits are still pending formal approval by government authorities and will be recognized when such approval is received. These tax credits will be subject to income taxes in Brazil. Based on the non-recurring nature of these credits, the total is not included in the updated adjusted EBITDA full year guidance.
Safe Harbor Statement: This press release contains forward-looking statements. These forward-looking statements are covered by the safe harbor for "forward-looking statements" provided by the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "anticipate," "plan," "would," "could," "potential," "may," "will," and other similar expressions are intended to identify forward-looking statements, which are generally not historical in nature. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. Although we believe the assumptions upon which these forward-looking statements are based are reasonable, these assumptions are subject to significant risks and uncertainties. These risk factors include, but are not limited to the effect of the COVID-19 pandemic on our operations and financial performance; the effect of a recession on the Company and its customers and suppliers; changes in the Company's end-user markets into which the Company sells its products as a result of domestic and world economic or regulatory influences or otherwise; changes in the marketplace, including new products and pricing changes by the Company's competitors; availability and price of raw materials; availability and price of supply chain logistics and freight; levels of operating efficiencies; and geopolitical and economic uncertainties relating to the countries in which the Company operates or does business. Additional risks and other factors that could cause actual results or events to differ materially from those contemplated in this release are detailed in the Company's reports on Forms 10-K and 10-Q filed with the Securities and Exchange Commission, especially the disclosures under "Risk Factors" in those reports. These forward-looking statements are made only as of the date hereof. The Company cautions that any forward-looking statements included in this press release are subject to a number of risks and uncertainties, and the Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, changed circumstances or future events, or for any other reason, except as required by law.
About Titan: Titan International, Inc. (NYSE: TWI) is a leading global manufacturer of off-highway wheels, tires, assemblies, and undercarriage products. Headquartered in West Chicago, Illinois, the company globally produces a broad range of products to meet the specifications of original equipment manufacturers (OEMs) and aftermarket customers in the agricultural, earthmoving/construction, and consumer markets. For more information, visit www.titan-intl.com.
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SOURCE Titan International, Inc.