Titan Returns to Profit as Consumer Sales Jump
Second-quarter revenue reached $484.8 million, near the high end of Titan’s prior guidance.
Titan International (TWI), the off-highway wheel and tire maker, returned to adjusted profitability in the second quarter as consumer sales offset weaker agricultural demand. Adjusted earnings were $6.5 million, or $0.10 a share, compared with a loss of $1.6 million, or $0.02 a share, a year earlier.
Revenue rose 5.2% to $484.8 million, accelerating from 2.9% growth in the first quarter while remaining below the fourth quarter’s 7% pace. Sales declined 4.0% sequentially from $505.1 million. Currency translation supplied 2.4 percentage points of the year-over-year increase, leaving growth of about 2.8% in constant currencies.
Operating income increased 31% to $13.3 million, while adjusted EBITDA rose 13.3% to $34.2 million and exceeded the company’s prior guidance range by $4.2 million. Adjusted EBITDA had climbed from about $31 million in the first quarter and $11 million in the fourth quarter of 2024.
Gross margin expanded to 15.5% from 15.0% a year earlier and 14.1% in the first quarter, extending its recovery from 10.9% in the fourth quarter. The quarter included $6.0 million of net tariff-refund recoveries, with $4.7 million recorded in the Consumer segment, materially supporting the margin improvement.
Consumer became Titan’s fastest-growing segment, with sales rising 27.2% to $146.6 million after declining 1.6% in the first quarter. The segment’s gross margin widened to 23.7% from 20.4%, and operating income more than quadrupled to $13.0 million. Its $31.3 million sales increase more than offset a $9.6 million decline in Agricultural revenue.
Agricultural sales fell 5.0% to $183.6 million as lower volumes in the Americas outweighed favorable currency translation. Segment gross margin narrowed to 11.4% from 14.6%, and operating income dropped 72.2% to $3.2 million. Earthmoving/Construction sales grew 1.4%, slowing from more than 11% growth in the first quarter, though operating income increased 45.4% to $4.4 million.
Titan expects third-quarter revenue of $440 million to $460 million and adjusted EBITDA of $27 million to $33 million, implying a sequential slowdown. The company maintained its full-year outlook for revenue of $1.85 billion to $1.95 billion and adjusted EBITDA of $105 million to $115 million.
Free cash flow increased to $26 million from $4 million a year earlier as working-capital performance improved. Net debt nevertheless rose to $413.5 million from $383.0 million at year-end, while restructuring and impairment expense fell to $0.8 million following the first-quarter action to close the Jackson, Tennessee, plant.