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Delaware
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No. 45-0357838
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(State or Other Jurisdiction of
Incorporation or Organization)
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(IRS Employer
Identification No.)
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Large accelerated filer
o
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Accelerated filer
x
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Non-accelerated filer
o
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Smaller reporting company
o
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(Do not check if smaller reporting company)
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||
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Page No.
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PART I.
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FINANCIAL INFORMATION
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|
ITEM 1.
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FINANCIAL STATEMENTS
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|
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Consolidated Balance Sheets as of July 31, 2015 and January 31, 2015
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|
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Consolidated Statements of Operations for the three and six months ended July 31, 2015 and 2014
|
|
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Consolidated Statements of Comprehensive Income for the three and six months ended July 31, 2015 and 2014
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Consolidated Statements of Stockholders' Equity for the six months ended July 31, 2015 and 2014
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Consolidated Statements of Cash Flows for the six months ended July 31, 2015 and 2014
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Notes to Consolidated Financial Statements
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ITEM 2.
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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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ITEM 3.
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QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
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ITEM 4.
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CONTROLS AND PROCEDURES
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PART II.
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OTHER INFORMATION
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ITEM 1.
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LEGAL PROCEEDINGS
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ITEM 1A.
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RISK FACTORS
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ITEM 2.
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UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
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ITEM 3.
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DEFAULTS UPON SENIOR SECURITIES
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ITEM 4.
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MINE SAFETY DISCLOSURES
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ITEM 5.
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OTHER INFORMATION
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ITEM 6.
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EXHIBITS
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Signatures
|
|
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Exhibit Index
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|
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July 31, 2015
|
|
January 31, 2015
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||||
|
(Unaudited)
|
|
|
||||
Assets
|
|
|
|
|
|||
Current Assets
|
|
|
|
||||
Cash
|
$
|
95,416
|
|
|
$
|
127,528
|
|
Receivables (net of allowance of $4,054 and $4,218 as of July 31, 2015 and January 31, 2015, respectively)
|
70,797
|
|
|
76,382
|
|
||
Inventories
|
877,823
|
|
|
879,440
|
|
||
Prepaid expenses and other
|
5,353
|
|
|
10,634
|
|
||
Income taxes receivable
|
3,834
|
|
|
166
|
|
||
Deferred income taxes
|
18,297
|
|
|
19,025
|
|
||
Assets held for sale
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11,246
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|
|
15,312
|
|
||
Total current assets
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1,082,766
|
|
|
1,128,487
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||
Intangibles and Other Assets
|
|
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||||
Intangible assets, net of accumulated amortization
|
5,272
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|
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5,458
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|
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Other
|
6,490
|
|
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7,122
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|
||
Total intangibles and other assets
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11,762
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|
12,580
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|
||
Property and Equipment, net of accumulated depreciation
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186,000
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|
|
208,680
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||
Total Assets
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$
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1,280,528
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|
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$
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1,349,747
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|
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|
||||
Liabilities and Stockholders' Equity
|
|
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|
||||
Current Liabilities
|
|
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|
||||
Accounts payable
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$
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18,358
|
|
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$
|
17,659
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Floorplan payable
|
619,636
|
|
|
627,249
|
|
||
Current maturities of long-term debt
|
6,365
|
|
|
7,749
|
|
||
Customer deposits
|
15,442
|
|
|
35,090
|
|
||
Accrued expenses
|
30,062
|
|
|
35,496
|
|
||
Income taxes payable
|
—
|
|
|
3,529
|
|
||
Liabilities held for sale
|
2,531
|
|
|
2,835
|
|
||
Total current liabilities
|
692,394
|
|
|
729,607
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|
||
Long-Term Liabilities
|
|
|
|
||||
Senior convertible notes
|
134,170
|
|
|
132,350
|
|
||
Long-term debt, less current maturities
|
41,629
|
|
|
67,123
|
|
||
Deferred income taxes
|
39,433
|
|
|
38,996
|
|
||
Other long-term liabilities
|
3,289
|
|
|
3,312
|
|
||
Total long-term liabilities
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218,521
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|
|
241,781
|
|
||
Commitments and Contingencies
|
|
|
|
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||
Stockholders' Equity
|
|
|
|
||||
Common stock, par value $.00001 per share, 45,000 shares authorized; 21,574 shares issued and outstanding at July 31, 2015; 21,406 shares issued and outstanding at January 31, 2015
|
—
|
|
|
—
|
|
||
Additional paid-in-capital
|
241,158
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|
|
240,180
|
|
||
Retained earnings
|
131,120
|
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|
137,418
|
|
||
Accumulated other comprehensive loss
|
(3,492
|
)
|
|
(1,099
|
)
|
||
Total Titan Machinery Inc. stockholders' equity
|
368,786
|
|
|
376,499
|
|
||
Noncontrolling interest
|
827
|
|
|
1,860
|
|
||
Total stockholders' equity
|
369,613
|
|
|
378,359
|
|
||
Total Liabilities and Stockholders' Equity
|
$
|
1,280,528
|
|
|
$
|
1,349,747
|
|
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Three Months Ended July 31,
|
|
Six Months Ended July 31,
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||||||||||||
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2015
|
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2014
|
|
2015
|
|
2014
|
||||||||
Revenue
|
|
|
|
|
|
|
|
||||||||
Equipment
|
$
|
221,016
|
|
|
$
|
320,087
|
|
|
$
|
465,999
|
|
|
$
|
665,132
|
|
Parts
|
62,081
|
|
|
70,526
|
|
|
123,601
|
|
|
138,905
|
|
||||
Service
|
32,842
|
|
|
38,447
|
|
|
65,744
|
|
|
75,531
|
|
||||
Rental and other
|
18,251
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|
21,930
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|
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32,042
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|
|
36,885
|
|
||||
Total Revenue
|
334,190
|
|
|
450,990
|
|
|
687,386
|
|
|
916,453
|
|
||||
Cost of Revenue
|
|
|
|
|
|
|
|
||||||||
Equipment
|
203,152
|
|
|
292,879
|
|
|
430,185
|
|
|
609,161
|
|
||||
Parts
|
43,382
|
|
|
49,730
|
|
|
86,953
|
|
|
97,744
|
|
||||
Service
|
12,327
|
|
|
13,529
|
|
|
23,687
|
|
|
27,932
|
|
||||
Rental and other
|
13,260
|
|
|
15,199
|
|
|
24,057
|
|
|
26,024
|
|
||||
Total Cost of Revenue
|
272,121
|
|
|
371,337
|
|
|
564,882
|
|
|
760,861
|
|
||||
Gross Profit
|
62,069
|
|
|
79,653
|
|
|
122,504
|
|
|
155,592
|
|
||||
Operating Expenses
|
55,385
|
|
|
67,795
|
|
|
112,495
|
|
|
138,947
|
|
||||
Impairment and Realignment Costs
|
(104
|
)
|
|
151
|
|
|
1,497
|
|
|
2,952
|
|
||||
Income from Operations
|
6,788
|
|
|
11,707
|
|
|
8,512
|
|
|
13,693
|
|
||||
Other Income (Expense)
|
|
|
|
|
|
|
|
||||||||
Interest income and other income (expense)
|
837
|
|
|
(1,028
|
)
|
|
(1,287
|
)
|
|
(3,606
|
)
|
||||
Floorplan interest expense
|
(4,744
|
)
|
|
(5,308
|
)
|
|
(9,343
|
)
|
|
(9,901
|
)
|
||||
Other interest expense
|
(3,360
|
)
|
|
(3,559
|
)
|
|
(7,187
|
)
|
|
(7,000
|
)
|
||||
Income (Loss) Before Income Taxes
|
(479
|
)
|
|
1,812
|
|
|
(9,305
|
)
|
|
(6,814
|
)
|
||||
Provision for (Benefit from) Income Taxes
|
(649
|
)
|
|
2,587
|
|
|
(2,585
|
)
|
|
854
|
|
||||
Net Income (Loss) Including Noncontrolling Interest
|
$
|
170
|
|
|
$
|
(775
|
)
|
|
$
|
(6,720
|
)
|
|
$
|
(7,668
|
)
|
Less: Net Income (Loss) Attributable to Noncontrolling Interest
|
164
|
|
|
(161
|
)
|
|
(422
|
)
|
|
(505
|
)
|
||||
Net Income (Loss) Attributable to Titan Machinery Inc.
|
$
|
6
|
|
|
$
|
(614
|
)
|
|
$
|
(6,298
|
)
|
|
$
|
(7,163
|
)
|
Net Income (Loss) Allocated to Participating Securities - Note 1
|
—
|
|
|
11
|
|
|
112
|
|
|
114
|
|
||||
Net Income (Loss) Attributable to Titan Machinery Inc. Common Stockholders
|
$
|
6
|
|
|
$
|
(603
|
)
|
|
$
|
(6,186
|
)
|
|
$
|
(7,049
|
)
|
Earnings (Loss) per Share - Note 1
|
|
|
|
|
|
|
|
||||||||
Earnings (Loss) per Share - Basic
|
$
|
0.00
|
|
|
$
|
(0.03
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(0.34
|
)
|
Earnings (Loss) per Share - Diluted
|
$
|
0.00
|
|
|
$
|
(0.03
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(0.34
|
)
|
Weighted Average Common Shares - Basic
|
21,105
|
|
|
20,986
|
|
|
21,075
|
|
|
20,969
|
|
||||
Weighted Average Common Shares - Diluted
|
21,217
|
|
|
20,986
|
|
|
21,075
|
|
|
20,969
|
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Net Income (Loss) Including Noncontrolling Interest
|
$
|
170
|
|
|
$
|
(775
|
)
|
|
$
|
(6,720
|
)
|
|
$
|
(7,668
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
2,462
|
|
|
1,066
|
|
|
(3,729
|
)
|
|
(154
|
)
|
||||
Unrealized gain on net investment hedge derivative instruments, net of tax expense of $84 and $528 for the three months ended July 31, 2015 and 2014, respectively, and $128 and $30 for the six months ended July 31, 2015 and 2014, respectively
|
126
|
|
|
793
|
|
|
193
|
|
|
46
|
|
||||
Unrealized gain (loss) on interest rate swap cash flow hedge derivative instrument, net of tax expense (benefit) of ($42) and ($34) for the three months ended July 31, 2015 and 2014, respectively, and $30 and ($32) for the six months ended July 31, 2015 and 2014, respectively
|
(63
|
)
|
|
(49
|
)
|
|
46
|
|
|
(46
|
)
|
||||
Unrealized gain on foreign currency contract cash flow hedge derivative instruments, net of tax expense of $8 and $29 for the three and six months ended July 31, 2014, respectively
|
—
|
|
|
12
|
|
|
—
|
|
|
44
|
|
||||
Reclassification of loss on interest rate swap cash flow hedge derivative instruments included in net income (loss), net of tax benefit of $147 and $319 for the three and six months ended July 31, 2015, respectively
|
220
|
|
|
—
|
|
|
478
|
|
|
—
|
|
||||
Reclassification of loss on foreign currency contract cash flow hedge derivative instruments included in net income (loss), net of tax benefit of $0 and $8 for the three months ended July 31, 2015 and July 31, 2014, respectively, and $5 and $14 for the six months ended July 31, 2015 and 2014, respectively
|
—
|
|
|
11
|
|
|
8
|
|
|
20
|
|
||||
Total Other Comprehensive Income (Loss)
|
2,745
|
|
|
1,833
|
|
|
(3,004
|
)
|
|
(90
|
)
|
||||
Comprehensive Income (Loss)
|
2,915
|
|
|
1,058
|
|
|
(9,724
|
)
|
|
(7,758
|
)
|
||||
Comprehensive Income (Loss) Attributable to Noncontrolling Interest
|
672
|
|
|
132
|
|
|
(1,033
|
)
|
|
(518
|
)
|
||||
Comprehensive Income (Loss) Attributable To Titan Machinery Inc.
|
$
|
2,243
|
|
|
$
|
926
|
|
|
$
|
(8,691
|
)
|
|
$
|
(7,240
|
)
|
|
Common Stock
|
|
|
|
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||
|
Shares Outstanding
|
|
Amount
|
|
Additional Paid-In Capital
|
|
Retained Earnings
|
|
Foreign Currency Translation Adjustments
|
|
Unrealized Gains (Losses) on Net Investment Hedges
|
|
Unrealized Gains (Losses) on Interest Rate Swap Cash Flow Hedges
|
|
Unrealized Gains (Losses) on Foreign Currency Contract Cash Flow Hedges
|
|
Total
|
|
Total Titan Machinery Inc. Stockholders' Equity
|
|
Noncontrolling Interest
|
|
Total Stockholders' Equity
|
|||||||||||||||||||||||
Balance, January 31, 2014
|
21,261
|
|
|
$
|
—
|
|
|
$
|
238,857
|
|
|
$
|
169,575
|
|
|
$
|
1,541
|
|
|
$
|
(339
|
)
|
|
$
|
(737
|
)
|
|
$
|
(126
|
)
|
|
$
|
339
|
|
|
$
|
408,771
|
|
|
$
|
2,571
|
|
|
$
|
411,342
|
|
Common stock issued on grant of restricted stock (net of forfeitures), exercise of stock options, and tax benefits of equity awards
|
152
|
|
|
—
|
|
|
(50
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(50
|
)
|
|
—
|
|
|
(50
|
)
|
|||||||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
1,078
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,078
|
|
|
—
|
|
|
1,078
|
|
|||||||||||
Other
|
—
|
|
|
—
|
|
|
(502
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(502
|
)
|
|
501
|
|
|
(1
|
)
|
|||||||||||
Comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,163
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,163
|
)
|
|
(505
|
)
|
|
(7,668
|
)
|
|||||||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(141
|
)
|
|
46
|
|
|
(46
|
)
|
|
64
|
|
|
(77
|
)
|
|
(77
|
)
|
|
(13
|
)
|
|
(90
|
)
|
|||||||||||
Total comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,240
|
)
|
|
(518
|
)
|
|
(7,758
|
)
|
|||||||||||
Balance, July 31, 2014
|
21,413
|
|
|
$
|
—
|
|
|
$
|
239,383
|
|
|
$
|
162,412
|
|
|
$
|
1,400
|
|
|
$
|
(293
|
)
|
|
$
|
(783
|
)
|
|
$
|
(62
|
)
|
|
$
|
262
|
|
|
$
|
402,057
|
|
|
$
|
2,554
|
|
|
$
|
404,611
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Balance, January 31, 2015
|
21,406
|
|
|
$
|
—
|
|
|
$
|
240,180
|
|
|
$
|
137,418
|
|
|
$
|
(1,632
|
)
|
|
$
|
2,510
|
|
|
$
|
(1,940
|
)
|
|
$
|
(37
|
)
|
|
$
|
(1,099
|
)
|
|
$
|
376,499
|
|
|
$
|
1,860
|
|
|
$
|
378,359
|
|
Common stock issued on grant of restricted stock (net of forfeitures), exercise of stock options, and tax benefits of equity awards
|
168
|
|
|
—
|
|
|
(158
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(158
|
)
|
|
—
|
|
|
(158
|
)
|
|||||||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
1,136
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,136
|
|
|
—
|
|
|
1,136
|
|
|||||||||||
Comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,298
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,298
|
)
|
|
(422
|
)
|
|
(6,720
|
)
|
|||||||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,118
|
)
|
|
193
|
|
|
524
|
|
|
8
|
|
|
(2,393
|
)
|
|
(2,393
|
)
|
|
(611
|
)
|
|
(3,004
|
)
|
|||||||||||
Total comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,691
|
)
|
|
(1,033
|
)
|
|
(9,724
|
)
|
|||||||||||
Balance, July 31, 2015
|
21,574
|
|
|
$
|
—
|
|
|
$
|
241,158
|
|
|
$
|
131,120
|
|
|
$
|
(4,750
|
)
|
|
$
|
2,703
|
|
|
$
|
(1,416
|
)
|
|
$
|
(29
|
)
|
|
$
|
(3,492
|
)
|
|
$
|
368,786
|
|
|
$
|
827
|
|
|
$
|
369,613
|
|
|
Six Months Ended July 31,
|
||||||
|
2015
|
|
2014
|
||||
Operating Activities
|
|
|
|
||||
Net loss including noncontrolling interest
|
$
|
(6,720
|
)
|
|
$
|
(7,668
|
)
|
Adjustments to reconcile net loss including noncontrolling interest to net cash provided by (used for) operating activities
|
|
|
|
||||
Depreciation and amortization
|
13,824
|
|
|
14,746
|
|
||
Impairment
|
152
|
|
|
268
|
|
||
Deferred income taxes
|
689
|
|
|
385
|
|
||
Stock-based compensation expense
|
1,136
|
|
|
1,078
|
|
||
Noncash interest expense
|
3,018
|
|
|
2,326
|
|
||
Unrealized foreign currency (gain) loss on loans to international subsidiaries
|
816
|
|
|
(319
|
)
|
||
Other, net
|
(245
|
)
|
|
(17
|
)
|
||
Changes in assets and liabilities
|
|
|
|
||||
Receivables, prepaid expenses and other assets
|
6,296
|
|
|
20,350
|
|
||
Inventories
|
8,910
|
|
|
(68,312
|
)
|
||
Manufacturer floorplan payable
|
186,563
|
|
|
(643
|
)
|
||
Accounts payable, customer deposits, accrued expenses and other long-term liabilities
|
(21,444
|
)
|
|
(38,352
|
)
|
||
Income taxes
|
(7,426
|
)
|
|
(3,249
|
)
|
||
Net Cash Provided by (Used for) Operating Activities
|
185,569
|
|
|
(79,407
|
)
|
||
Investing Activities
|
|
|
|
||||
Rental fleet purchases
|
(250
|
)
|
|
(502
|
)
|
||
Property and equipment purchases (excluding rental fleet)
|
(3,910
|
)
|
|
(8,249
|
)
|
||
Proceeds from sale of property and equipment
|
2,201
|
|
|
2,444
|
|
||
Proceeds upon settlement of net investment hedge derivative instruments
|
337
|
|
|
1,219
|
|
||
Payments upon settlement of net investment hedge derivative instruments
|
—
|
|
|
(915
|
)
|
||
Other, net
|
133
|
|
|
24
|
|
||
Net Cash Used for Investing Activities
|
(1,489
|
)
|
|
(5,979
|
)
|
||
Financing Activities
|
|
|
|
||||
Net change in non-manufacturer floorplan payable
|
(190,744
|
)
|
|
100,790
|
|
||
Proceeds from long-term debt borrowings
|
20,058
|
|
|
5,832
|
|
||
Principal payments on long-term debt
|
(44,468
|
)
|
|
(5,558
|
)
|
||
Other, net
|
(573
|
)
|
|
(264
|
)
|
||
Net Cash Provided by (Used for) Financing Activities
|
(215,727
|
)
|
|
100,800
|
|
||
Effect of Exchange Rate Changes on Cash
|
(465
|
)
|
|
57
|
|
||
Net Change in Cash
|
(32,112
|
)
|
|
15,471
|
|
||
Cash at Beginning of Period
|
127,528
|
|
|
74,242
|
|
||
Cash at End of Period
|
$
|
95,416
|
|
|
$
|
89,713
|
|
Supplemental Disclosures of Cash Flow Information
|
|
|
|
||||
Cash paid during the period
|
|
|
|
||||
Income taxes, net of refunds
|
$
|
4,093
|
|
|
$
|
3,734
|
|
Interest
|
$
|
13,401
|
|
|
$
|
13,830
|
|
Supplemental Disclosures of Noncash Investing and Financing Activities
|
|
|
|
||||
Net property and equipment financed with long-term debt, accounts payable and accrued liabilities
|
$
|
612
|
|
|
$
|
3,968
|
|
Long-term debt extinguished upon sale of property and equipment
|
$
|
3,315
|
|
|
$
|
—
|
|
Net transfer of assets to (from) property and equipment from (to) inventories
|
$
|
(6,871
|
)
|
|
$
|
7,218
|
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(in thousands, except per share data)
|
|
(in thousands, except per share data)
|
||||||||||||
Basic Weighted-Average Common Shares Outstanding
|
21,105
|
|
|
20,986
|
|
|
21,075
|
|
|
20,969
|
|
||||
Plus: Incremental Shares From Assumed Exercise of Stock Options
|
112
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Diluted Weighted-Average Common Shares Outstanding
|
21,217
|
|
|
20,986
|
|
|
21,075
|
|
|
20,969
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Earnings (Loss) per Share - Basic
|
$
|
0.00
|
|
|
$
|
(0.03
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(0.34
|
)
|
Earnings (Loss) per Share - Diluted
|
$
|
0.00
|
|
|
$
|
(0.03
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(0.34
|
)
|
|
July 31, 2015
|
|
January 31, 2015
|
||||
|
(in thousands)
|
||||||
New equipment
|
$
|
454,852
|
|
|
$
|
442,984
|
|
Used equipment
|
313,689
|
|
|
318,308
|
|
||
Parts and attachments
|
97,006
|
|
|
107,893
|
|
||
Work in process
|
12,276
|
|
|
10,255
|
|
||
|
$
|
877,823
|
|
|
$
|
879,440
|
|
|
July 31, 2015
|
|
January 31, 2015
|
||||
|
(in thousands)
|
||||||
Rental fleet equipment
|
$
|
137,310
|
|
|
$
|
148,198
|
|
Machinery and equipment
|
23,762
|
|
|
24,071
|
|
||
Vehicles
|
37,947
|
|
|
43,435
|
|
||
Furniture and fixtures
|
38,487
|
|
|
39,421
|
|
||
Land, buildings, and leasehold improvements
|
57,426
|
|
|
57,630
|
|
||
|
294,932
|
|
|
312,755
|
|
||
Less accumulated depreciation
|
(108,932
|
)
|
|
(104,075
|
)
|
||
|
$
|
186,000
|
|
|
$
|
208,680
|
|
|
July 31, 2015
|
|
January 31, 2015
|
||||
|
(in thousands except conversion
rate and conversion price)
|
||||||
Principal value
|
$
|
150,000
|
|
|
$
|
150,000
|
|
Unamortized debt discount
|
(15,830
|
)
|
|
(17,650
|
)
|
||
Carrying value of senior convertible notes
|
$
|
134,170
|
|
|
$
|
132,350
|
|
|
|
|
|
||||
Carrying value of equity component, net of deferred taxes
|
$
|
15,546
|
|
|
$
|
15,546
|
|
|
|
|
|
||||
Conversion rate (shares of common stock per $1,000 principal amount of notes)
|
23.1626
|
|
|
|
|||
Conversion price (per share of common stock)
|
$
|
43.17
|
|
|
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(in thousands)
|
(in thousands)
|
|||||||||||||
Cash Interest Expense
|
|
|
|
|
|
|
|
||||||||
Coupon interest expense
|
$
|
1,407
|
|
|
$
|
1,407
|
|
|
$
|
2,813
|
|
|
$
|
2,813
|
|
Noncash Interest Expense
|
|
|
|
|
|
|
|
||||||||
Amortization of debt discount
|
926
|
|
|
864
|
|
|
1,820
|
|
|
1,699
|
|
||||
Amortization of transaction costs
|
138
|
|
|
134
|
|
|
274
|
|
|
267
|
|
||||
|
$
|
2,471
|
|
|
$
|
2,405
|
|
|
$
|
4,907
|
|
|
$
|
4,779
|
|
|
Notional Amount as of:
|
||||||
|
July 31, 2015
|
|
January 31, 2015
|
||||
|
(in thousands)
|
||||||
Net investment hedge:
|
|
|
|
||||
Foreign currency contracts
|
$
|
6,443
|
|
|
$
|
14,223
|
|
Cash flow hedges:
|
|
|
|
||||
Interest rate swap
|
100,000
|
|
|
100,000
|
|
||
Foreign currency contracts
|
—
|
|
|
—
|
|
||
Derivatives not designated as hedging instruments:
|
|
|
|
||||
Foreign currency contracts
|
26,122
|
|
|
30,030
|
|
|
Fair Value as of:
|
|
Balance Sheet Location
|
||||||
|
July 31, 2015
|
|
January 31, 2015
|
|
|||||
|
(in thousands)
|
|
|
||||||
Liability Derivatives:
|
|
|
|
|
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
||||
Net investment hedges:
|
|
|
|
|
|
||||
Foreign currency contracts
|
$
|
35
|
|
|
$
|
19
|
|
|
Accrued expenses
|
Cash flow hedges:
|
|
|
|
|
|
||||
Interest rate swap
|
2,377
|
|
|
3,233
|
|
|
Accrued expenses
|
||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
||||
Foreign currency contracts
|
108
|
|
|
17
|
|
|
Accrued expenses
|
||
Total Liability Derivatives
|
$
|
2,520
|
|
|
$
|
3,269
|
|
|
|
|
|
July 31, 2015
|
|
January 31, 2015
|
||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||||||||||||||||||
Financial Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Interest rate swap
|
$
|
—
|
|
|
$
|
2,377
|
|
|
$
|
—
|
|
|
$
|
2,377
|
|
|
$
|
—
|
|
|
$
|
3,233
|
|
|
$
|
—
|
|
|
$
|
3,233
|
|
Foreign currency contracts
|
—
|
|
|
143
|
|
|
—
|
|
|
143
|
|
|
—
|
|
|
36
|
|
|
—
|
|
|
36
|
|
||||||||
Total Financial Liabilities
|
$
|
—
|
|
|
$
|
2,520
|
|
|
$
|
—
|
|
|
$
|
2,520
|
|
|
$
|
—
|
|
|
$
|
3,269
|
|
|
$
|
—
|
|
|
$
|
3,269
|
|
|
July 31, 2015
|
|
January 31, 2015
|
||||||||||||||||||||
|
Estimated Fair Value
|
|
Carrying Value
|
|
Face Value
|
|
Estimated Fair Value
|
|
Carrying Value
|
|
Face Value
|
||||||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||||||||||
Senior convertible notes
|
$
|
122,607
|
|
|
$
|
134,170
|
|
|
$
|
150,000
|
|
|
$
|
111,273
|
|
|
$
|
132,350
|
|
|
$
|
150,000
|
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||
Revenue
|
|
|
|
|
|
|
|
||||||||
Agriculture
|
$
|
209,449
|
|
|
$
|
305,721
|
|
|
$
|
449,304
|
|
|
$
|
650,102
|
|
Construction
|
81,407
|
|
|
101,747
|
|
|
162,578
|
|
|
193,512
|
|
||||
International
|
43,334
|
|
|
43,522
|
|
|
75,504
|
|
|
72,839
|
|
||||
Total
|
$
|
334,190
|
|
|
$
|
450,990
|
|
|
$
|
687,386
|
|
|
$
|
916,453
|
|
|
|
|
|
|
|
|
|
||||||||
Income (Loss) Before Income Taxes
|
|
|
|
|
|
|
|
||||||||
Agriculture
|
$
|
(2,440
|
)
|
|
$
|
6,494
|
|
|
$
|
(3,526
|
)
|
|
$
|
9,999
|
|
Construction
|
(937
|
)
|
|
(368
|
)
|
|
(4,502
|
)
|
|
(6,361
|
)
|
||||
International
|
946
|
|
|
(5,016
|
)
|
|
(3,425
|
)
|
|
(10,281
|
)
|
||||
Segment income (loss) before income taxes
|
(2,431
|
)
|
|
1,110
|
|
|
(11,453
|
)
|
|
(6,643
|
)
|
||||
Shared Resources
|
1,952
|
|
|
702
|
|
|
2,148
|
|
|
(171
|
)
|
||||
Income (Loss) Before Income Taxes
|
$
|
(479
|
)
|
|
$
|
1,812
|
|
|
$
|
(9,305
|
)
|
|
$
|
(6,814
|
)
|
|
July 31, 2015
|
|
January 31, 2015
|
||||
|
(in thousands)
|
||||||
Total Assets
|
|
|
|
||||
Agriculture
|
$
|
644,644
|
|
|
$
|
734,894
|
|
Construction
|
360,637
|
|
|
393,573
|
|
||
International
|
144,929
|
|
|
152,587
|
|
||
Segment assets
|
1,150,210
|
|
|
1,281,054
|
|
||
Shared Resources
|
130,318
|
|
|
68,693
|
|
||
Total
|
$
|
1,280,528
|
|
|
$
|
1,349,747
|
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
|
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
Income Statement Classification
|
||||||||
|
(in thousands)
|
|
(in thousands)
|
|
|
||||||||||||
Construction Segment
|
|
|
|
|
|
|
|
|
|
||||||||
Lease termination costs
|
$
|
—
|
|
|
$
|
(7
|
)
|
|
$
|
261
|
|
|
$
|
1,511
|
|
|
Impairment and Realignment Costs
|
Employee severance costs
|
(18
|
)
|
|
—
|
|
|
240
|
|
|
451
|
|
|
Impairment and Realignment Costs
|
||||
Impairment of fixed assets, net of gains on asset disposition
|
(80
|
)
|
|
(212
|
)
|
|
10
|
|
|
(60
|
)
|
|
Impairment and Realignment Costs
|
||||
Asset relocation and other closing costs
|
14
|
|
|
197
|
|
|
68
|
|
|
362
|
|
|
Impairment and Realignment Costs
|
||||
|
$
|
(84
|
)
|
|
$
|
(22
|
)
|
|
$
|
579
|
|
|
$
|
2,264
|
|
|
|
Agriculture Segment
|
|
|
|
|
|
|
|
|
|
||||||||
Lease termination costs
|
$
|
(160
|
)
|
|
$
|
34
|
|
|
$
|
91
|
|
|
$
|
148
|
|
|
Impairment and Realignment Costs
|
Employee severance costs
|
29
|
|
|
—
|
|
|
333
|
|
|
71
|
|
|
Impairment and Realignment Costs
|
||||
Impairment of fixed assets, net of gains on asset disposition
|
96
|
|
|
—
|
|
|
96
|
|
|
85
|
|
|
Impairment and Realignment Costs
|
||||
Asset relocation and other closing costs
|
8
|
|
|
52
|
|
|
93
|
|
|
84
|
|
|
Impairment and Realignment Costs
|
||||
Inventory cost adjustments
|
—
|
|
|
67
|
|
|
—
|
|
|
471
|
|
|
Equipment Cost of Sales
|
||||
|
$
|
(27
|
)
|
|
$
|
153
|
|
|
$
|
613
|
|
|
$
|
859
|
|
|
|
Shared Resource Center
|
|
|
|
|
|
|
|
|
|
||||||||
Lease termination costs
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
49
|
|
|
$
|
—
|
|
|
Impairment and Realignment Costs
|
Employee severance costs
|
—
|
|
|
87
|
|
|
187
|
|
|
300
|
|
|
Impairment and Realignment Costs
|
||||
Impairment of fixed assets, net of gains on asset disposition
|
7
|
|
|
—
|
|
|
69
|
|
|
—
|
|
|
Impairment and Realignment Costs
|
||||
|
$
|
7
|
|
|
$
|
87
|
|
|
$
|
305
|
|
|
$
|
300
|
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
||||||||
Lease termination costs
|
$
|
(160
|
)
|
|
$
|
27
|
|
|
$
|
401
|
|
|
$
|
1,659
|
|
|
Impairment and Realignment Costs
|
Employee severance costs
|
11
|
|
|
87
|
|
|
760
|
|
|
822
|
|
|
Impairment and Realignment Costs
|
||||
Impairment of fixed assets, net of gains on asset disposition
|
23
|
|
|
(212
|
)
|
|
175
|
|
|
25
|
|
|
Impairment and Realignment Costs
|
||||
Asset relocation and other closing costs
|
22
|
|
|
249
|
|
|
161
|
|
|
446
|
|
|
Impairment and Realignment Costs
|
||||
Inventory cost adjustments
|
—
|
|
|
67
|
|
|
—
|
|
|
471
|
|
|
Equipment Cost of Sales
|
||||
|
$
|
(104
|
)
|
|
$
|
218
|
|
|
$
|
1,497
|
|
|
$
|
3,423
|
|
|
—
|
|
Amount
|
||
|
(in thousands)
|
||
Balance, January 31, 2015
|
$
|
1,706
|
|
Exit costs incurred and charged to expense
|
|
||
Lease termination costs
|
401
|
|
|
Employee severance costs
|
760
|
|
|
Exit costs paid
|
|
||
Lease termination costs
|
(331
|
)
|
|
Employee severance costs
|
(740
|
)
|
|
Balance, July 31, 2015
|
$
|
1,796
|
|
|
July 31, 2015
|
|
January 31, 2015
|
||||
|
(in thousands)
|
||||||
Assets Held for Sale
|
|
|
|
||||
Receivables
|
$
|
85
|
|
|
$
|
147
|
|
Inventories
|
|
|
|
||||
New equipment
|
2,919
|
|
|
6,269
|
|
||
Used equipment
|
2,818
|
|
|
3,973
|
|
||
Parts and attachments
|
457
|
|
|
920
|
|
||
Work in process
|
15
|
|
|
65
|
|
||
Total inventories
|
6,209
|
|
|
11,227
|
|
||
Property and equipment
|
|
|
|
||||
Machinery and equipment
|
44
|
|
|
114
|
|
||
Vehicles
|
72
|
|
|
155
|
|
||
Furniture and fixtures
|
24
|
|
|
57
|
|
||
Land, buildings, and leasehold improvements
|
4,812
|
|
|
3,612
|
|
||
Total property and equipment
|
4,952
|
|
|
3,938
|
|
||
|
$
|
11,246
|
|
|
$
|
15,312
|
|
|
|
|
|
||||
Liabilities Held for Sale
|
|
|
|
||||
Accounts payable
|
$
|
47
|
|
|
$
|
151
|
|
Floorplan payable
|
2,470
|
|
|
1,771
|
|
||
Customer deposits
|
14
|
|
|
913
|
|
||
|
$
|
2,531
|
|
|
$
|
2,835
|
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||
U.S.
|
$
|
(1,396
|
)
|
|
$
|
6,823
|
|
|
$
|
(5,884
|
)
|
|
$
|
3,599
|
|
Foreign
|
917
|
|
|
(5,011
|
)
|
|
(3,421
|
)
|
|
(10,413
|
)
|
||||
Total
|
$
|
(479
|
)
|
|
$
|
1,812
|
|
|
$
|
(9,305
|
)
|
|
$
|
(6,814
|
)
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||
U.S. statutory rate
|
(35.0
|
)%
|
|
35.0
|
%
|
|
(35.0
|
)%
|
|
(35.0
|
)%
|
Foreign statutory rates
|
(56.8
|
)%
|
|
61.5
|
%
|
|
8.2
|
%
|
|
27.9
|
%
|
State taxes on income net of federal tax benefit
|
(4.2
|
)%
|
|
4.3
|
%
|
|
(4.2
|
)%
|
|
(4.3
|
)%
|
Change in valuation allowance
|
(389.1
|
)%
|
|
55.8
|
%
|
|
15.4
|
%
|
|
67.7
|
%
|
Tax effect of Ukrainian hryvnia devaluation
(a)
|
352.2
|
%
|
|
(14.7
|
)%
|
|
(9.1
|
)%
|
|
(42.4
|
)%
|
All other, net
|
(2.6
|
)%
|
|
0.9
|
%
|
|
(3.1
|
)%
|
|
(1.4
|
)%
|
|
(135.5
|
)%
|
|
142.8
|
%
|
|
(27.8
|
)%
|
|
12.5
|
%
|
|
•
|
Revenue
decreased
25.9%
for the
second
quarter of fiscal
2016
, as compared to the
second
quarter last year, primarily due to a decrease in Agriculture and Construction same-store sales;
|
•
|
Total gross profit margin increased to
18.6%
for the
second
quarter of fiscal
2016
, as compared to
17.7%
for the
second
quarter of fiscal
2015
, primarily caused by a change in gross profit mix to our higher-margin parts and service businesses;
|
•
|
Operating expenses
decreased
18.3%
for the
second
quarter of fiscal
2016
, as compared to the
second
quarter last year, primarily due to our realignment plan implemented in the first quarter of fiscal 2016 which decreased our headcount by 14% and generated additional cost savings from the closing of four stores during the quarter.
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(dollars in thousands)
|
|
(dollars in thousands)
|
||||||||||||
Equipment
|
|
|
|
|
|
|
|
|
|
||||||
Revenue
|
$
|
221,016
|
|
|
$
|
320,087
|
|
|
$
|
465,999
|
|
|
$
|
665,132
|
|
Cost of revenue
|
203,152
|
|
|
292,879
|
|
|
430,185
|
|
|
609,161
|
|
||||
Gross profit
|
$
|
17,864
|
|
|
$
|
27,208
|
|
|
$
|
35,814
|
|
|
$
|
55,971
|
|
Gross profit margin
|
8.1
|
%
|
|
8.5
|
%
|
|
7.7
|
%
|
|
8.4
|
%
|
||||
Parts
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
|
62,081
|
|
|
$
|
70,526
|
|
|
$
|
123,601
|
|
|
$
|
138,905
|
|
Cost of revenue
|
43,382
|
|
|
49,730
|
|
|
86,953
|
|
|
97,744
|
|
||||
Gross profit
|
$
|
18,699
|
|
|
$
|
20,796
|
|
|
$
|
36,648
|
|
|
$
|
41,161
|
|
Gross profit margin
|
30.1
|
%
|
|
29.5
|
%
|
|
29.7
|
%
|
|
29.6
|
%
|
||||
Service
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
|
32,842
|
|
|
$
|
38,447
|
|
|
$
|
65,744
|
|
|
$
|
75,531
|
|
Cost of revenue
|
12,327
|
|
|
13,529
|
|
|
23,687
|
|
|
27,932
|
|
||||
Gross profit
|
$
|
20,515
|
|
|
$
|
24,918
|
|
|
$
|
42,057
|
|
|
$
|
47,599
|
|
Gross profit margin
|
62.5
|
%
|
|
64.8
|
%
|
|
64.0
|
%
|
|
63.0
|
%
|
||||
Rental and other
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
|
18,251
|
|
|
$
|
21,930
|
|
|
$
|
32,042
|
|
|
$
|
36,885
|
|
Cost of revenue
|
13,260
|
|
|
15,199
|
|
|
24,057
|
|
|
26,024
|
|
||||
Gross profit
|
$
|
4,991
|
|
|
$
|
6,731
|
|
|
$
|
7,985
|
|
|
$
|
10,861
|
|
Gross profit margin
|
27.3
|
%
|
|
30.7
|
%
|
|
24.9
|
%
|
|
29.4
|
%
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||
Revenue
|
|
|
|
|
|
|
|
|
|
||
Equipment
|
66.1
|
%
|
|
71.0
|
%
|
|
67.8
|
%
|
|
72.6
|
%
|
Parts
|
18.6
|
%
|
|
15.6
|
%
|
|
18.0
|
%
|
|
15.2
|
%
|
Service
|
9.8
|
%
|
|
8.5
|
%
|
|
9.6
|
%
|
|
8.2
|
%
|
Rental and other
|
5.5
|
%
|
|
4.9
|
%
|
|
4.6
|
%
|
|
4.0
|
%
|
Total Revenue
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Total Cost of Revenue
|
81.4
|
%
|
|
82.3
|
%
|
|
82.2
|
%
|
|
83.0
|
%
|
Gross Profit Margin
|
18.6
|
%
|
|
17.7
|
%
|
|
17.8
|
%
|
|
17.0
|
%
|
Operating Expenses
|
16.6
|
%
|
|
15.1
|
%
|
|
16.4
|
%
|
|
15.2
|
%
|
Impairment and Realignment Costs
|
—
|
%
|
|
—
|
%
|
|
0.2
|
%
|
|
0.3
|
%
|
Income from Operations
|
2.0
|
%
|
|
2.6
|
%
|
|
1.2
|
%
|
|
1.5
|
%
|
Other Income (Expense)
|
(2.1
|
)%
|
|
(2.2
|
)%
|
|
(2.6
|
)%
|
|
(2.2
|
)%
|
Income (Loss) Before Income Taxes
|
(0.1
|
)%
|
|
0.4
|
%
|
|
(1.4
|
)%
|
|
(0.7
|
)%
|
Provision for (Benefit from) Income Taxes
|
(0.2
|
)%
|
|
0.6
|
%
|
|
(0.4
|
)%
|
|
0.1
|
%
|
Net Income (Loss) Including Noncontrolling Interest
|
0.1
|
%
|
|
(0.2
|
)%
|
|
(1.0
|
)%
|
|
(0.8
|
)%
|
Less: Net Income (Loss) Attributable to Noncontrolling Interest
|
0.1
|
%
|
|
(0.1
|
)%
|
|
(0.1
|
)%
|
|
—
|
%
|
Net Income (Loss) Attributable to Titan Machinery Inc.
|
—
|
%
|
|
(0.1
|
)%
|
|
(0.9
|
)%
|
|
(0.8
|
)%
|
|
Three Months Ended July 31,
|
|
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|
||||||||||
Equipment
|
$
|
221,016
|
|
|
$
|
320,087
|
|
|
$
|
(99,071
|
)
|
|
(31.0
|
)%
|
Parts
|
62,081
|
|
|
70,526
|
|
|
(8,445
|
)
|
|
(12.0
|
)%
|
|||
Service
|
32,842
|
|
|
38,447
|
|
|
(5,605
|
)
|
|
(14.6
|
)%
|
|||
Rental and other
|
18,251
|
|
|
21,930
|
|
|
(3,679
|
)
|
|
(16.8
|
)%
|
|||
Total Revenue
|
$
|
334,190
|
|
|
$
|
450,990
|
|
|
$
|
(116,800
|
)
|
|
(25.9
|
)%
|
|
Three Months Ended July 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|
||||||||||
Gross Profit
|
|
|
|
|
|
|
|
|||||||
Equipment
|
$
|
17,864
|
|
|
$
|
27,208
|
|
|
$
|
(9,344
|
)
|
|
(34.3
|
)%
|
Parts
|
18,699
|
|
|
20,796
|
|
|
(2,097
|
)
|
|
(10.1
|
)%
|
|||
Service
|
20,515
|
|
|
24,918
|
|
|
(4,403
|
)
|
|
(17.7
|
)%
|
|||
Rental and other
|
4,991
|
|
|
6,731
|
|
|
(1,740
|
)
|
|
(25.9
|
)%
|
|||
Total Gross Profit
|
$
|
62,069
|
|
|
$
|
79,653
|
|
|
$
|
(17,584
|
)
|
|
(22.1
|
)%
|
Gross Profit Margin
|
|
|
|
|
|
|
|
|||||||
Equipment
|
8.1
|
%
|
|
8.5
|
%
|
|
(0.4
|
)%
|
|
(4.7
|
)%
|
|||
Parts
|
30.1
|
%
|
|
29.5
|
%
|
|
0.6
|
%
|
|
2.0
|
%
|
|||
Service
|
62.5
|
%
|
|
64.8
|
%
|
|
(2.3
|
)%
|
|
(3.5
|
)%
|
|||
Rental and other
|
27.3
|
%
|
|
30.7
|
%
|
|
(3.4
|
)%
|
|
(11.1
|
)%
|
|||
Total Gross Profit Margin
|
18.6
|
%
|
|
17.7
|
%
|
|
0.9
|
%
|
|
5.1
|
%
|
|||
Gross Profit Mix
|
|
|
|
|
|
|
|
|||||||
Equipment
|
28.8
|
%
|
|
34.2
|
%
|
|
(5.4
|
)%
|
|
(15.8
|
)%
|
|||
Parts
|
30.1
|
%
|
|
26.1
|
%
|
|
4.0
|
%
|
|
15.3
|
%
|
|||
Service
|
33.1
|
%
|
|
31.3
|
%
|
|
1.8
|
%
|
|
5.8
|
%
|
|||
Rental and other
|
8.0
|
%
|
|
8.4
|
%
|
|
(0.4
|
)%
|
|
(4.8
|
)%
|
|||
Total Gross Profit Mix
|
100.0
|
%
|
|
100.0
|
%
|
|
—
|
%
|
|
—
|
%
|
|
Three Months Ended July 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Operating Expenses
|
$
|
55,385
|
|
|
$
|
67,795
|
|
|
$
|
(12,410
|
)
|
|
(18.3
|
)%
|
Operating Expenses as a Percentage of Revenue
|
16.6
|
%
|
|
15.1
|
%
|
|
1.5
|
%
|
|
9.9
|
%
|
|
Three Months Ended July 31,
|
|
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
Decrease
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Impairment and Realignment Costs
|
$
|
(104
|
)
|
|
$
|
151
|
|
|
$
|
(255
|
)
|
|
(168.9
|
)%
|
|
Three Months Ended July 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Interest income and other income (expense)
|
$
|
837
|
|
|
$
|
(1,028
|
)
|
|
$
|
1,865
|
|
|
181.4
|
%
|
Floorplan interest expense
|
(4,744
|
)
|
|
(5,308
|
)
|
|
(564
|
)
|
|
(10.6
|
)%
|
|||
Other interest expense
|
(3,360
|
)
|
|
(3,559
|
)
|
|
(199
|
)
|
|
(5.6
|
)%
|
|
Three Months Ended July 31,
|
|
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
Decrease
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Provision for (Benefit from) Income Taxes
|
$
|
(649
|
)
|
|
$
|
2,587
|
|
|
$
|
(3,236
|
)
|
|
(125.1
|
)%
|
|
Three Months Ended July 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Revenue
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
209,449
|
|
|
$
|
305,721
|
|
|
$
|
(96,272
|
)
|
|
(31.5
|
)%
|
Construction
|
81,407
|
|
|
101,747
|
|
|
(20,340
|
)
|
|
(20.0
|
)%
|
|||
International
|
43,334
|
|
|
43,522
|
|
|
(188
|
)
|
|
(0.4
|
)%
|
|||
Total
|
$
|
334,190
|
|
|
$
|
450,990
|
|
|
$
|
(116,800
|
)
|
|
(25.9
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Income (Loss) Before Income Taxes
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
(2,440
|
)
|
|
$
|
6,494
|
|
|
$
|
(8,934
|
)
|
|
(137.6
|
)%
|
Construction
|
(937
|
)
|
|
(368
|
)
|
|
(569
|
)
|
|
(154.6
|
)%
|
|||
International
|
946
|
|
|
(5,016
|
)
|
|
5,962
|
|
|
118.9
|
%
|
|||
Segment income (loss) before income taxes
|
(2,431
|
)
|
|
1,110
|
|
|
(3,541
|
)
|
|
(319.0
|
)%
|
|||
Shared Resources
|
1,952
|
|
|
702
|
|
|
1,250
|
|
|
178.1
|
%
|
|||
Income (Loss) Before Income Taxes
|
$
|
(479
|
)
|
|
$
|
1,812
|
|
|
$
|
(2,291
|
)
|
|
(126.4
|
)%
|
|
Six Months Ended July 31,
|
|
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|
||||||||||
Equipment
|
$
|
465,999
|
|
|
$
|
665,132
|
|
|
$
|
(199,133
|
)
|
|
(29.9
|
)%
|
Parts
|
123,601
|
|
|
138,905
|
|
|
(15,304
|
)
|
|
(11.0
|
)%
|
|||
Service
|
65,744
|
|
|
75,531
|
|
|
(9,787
|
)
|
|
(13.0
|
)%
|
|||
Rental and other
|
32,042
|
|
|
36,885
|
|
|
(4,843
|
)
|
|
(13.1
|
)%
|
|||
Total Revenue
|
$
|
687,386
|
|
|
$
|
916,453
|
|
|
$
|
(229,067
|
)
|
|
(25.0
|
)%
|
|
Six Months Ended July 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|
||||||||||
Gross Profit
|
|
|
|
|
|
|
|
|||||||
Equipment
|
$
|
35,814
|
|
|
$
|
55,971
|
|
|
$
|
(20,157
|
)
|
|
(36.0
|
)%
|
Parts
|
36,648
|
|
|
41,161
|
|
|
(4,513
|
)
|
|
(11.0
|
)%
|
|||
Service
|
42,057
|
|
|
47,599
|
|
|
(5,542
|
)
|
|
(11.6
|
)%
|
|||
Rental and other
|
7,985
|
|
|
10,861
|
|
|
(2,876
|
)
|
|
(26.5
|
)%
|
|||
Total Gross Profit
|
$
|
122,504
|
|
|
$
|
155,592
|
|
|
$
|
(33,088
|
)
|
|
(21.3
|
)%
|
Gross Profit Margin
|
|
|
|
|
|
|
|
|||||||
Equipment
|
7.7
|
%
|
|
8.4
|
%
|
|
(0.7
|
)%
|
|
(8.3
|
)%
|
|||
Parts
|
29.7
|
%
|
|
29.6
|
%
|
|
0.1
|
%
|
|
0.3
|
%
|
|||
Service
|
64.0
|
%
|
|
63.0
|
%
|
|
1.0
|
%
|
|
1.6
|
%
|
|||
Rental and other
|
24.9
|
%
|
|
29.4
|
%
|
|
(4.5
|
)%
|
|
(15.3
|
)%
|
|||
Total Gross Profit Margin
|
17.8
|
%
|
|
17.0
|
%
|
|
0.8
|
%
|
|
4.7
|
%
|
|||
Gross Profit Mix
|
|
|
|
|
|
|
|
|||||||
Equipment
|
29.2
|
%
|
|
36.0
|
%
|
|
(6.8
|
)%
|
|
(18.9
|
)%
|
|||
Parts
|
29.9
|
%
|
|
26.4
|
%
|
|
3.5
|
%
|
|
13.3
|
%
|
|||
Service
|
34.3
|
%
|
|
30.6
|
%
|
|
3.7
|
%
|
|
12.1
|
%
|
|||
Rental and other
|
6.6
|
%
|
|
7.0
|
%
|
|
(0.4
|
)%
|
|
(5.7
|
)%
|
|||
Total Gross Profit Mix
|
100.0
|
%
|
|
100.0
|
%
|
|
—
|
%
|
|
—
|
%
|
|
Six Months Ended July 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Operating Expenses
|
$
|
112,495
|
|
|
$
|
138,947
|
|
|
$
|
(26,452
|
)
|
|
(19.0
|
)%
|
Operating Expenses as a Percentage of Revenue
|
16.4
|
%
|
|
15.2
|
%
|
|
1.2
|
%
|
|
7.9
|
%
|
|
Six Months Ended July 31,
|
|
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Impairment and Realignment Costs
|
$
|
1,497
|
|
|
$
|
2,952
|
|
|
$
|
(1,455
|
)
|
|
(49.3
|
)%
|
|
Six Months Ended July 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Interest income and other income (expense)
|
$
|
(1,287
|
)
|
|
$
|
(3,606
|
)
|
|
$
|
2,319
|
|
|
64.3
|
%
|
Floorplan interest expense
|
(9,343
|
)
|
|
(9,901
|
)
|
|
(558
|
)
|
|
(5.6
|
)%
|
|||
Other interest expense
|
(7,187
|
)
|
|
(7,000
|
)
|
|
187
|
|
|
2.7
|
%
|
|
Six Months Ended July 31,
|
|
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
Increase
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Provision for (Benefit from) Income Taxes
|
$
|
(2,585
|
)
|
|
$
|
854
|
|
|
$
|
(3,439
|
)
|
|
(402.7
|
)%
|
|
Six Months Ended July 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2015
|
|
2014
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Revenue
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
449,304
|
|
|
$
|
650,102
|
|
|
$
|
(200,798
|
)
|
|
(30.9
|
)%
|
Construction
|
162,578
|
|
|
193,512
|
|
|
(30,934
|
)
|
|
(16.0
|
)%
|
|||
International
|
75,504
|
|
|
72,839
|
|
|
2,665
|
|
|
3.7
|
%
|
|||
Total
|
$
|
687,386
|
|
|
$
|
916,453
|
|
|
$
|
(229,067
|
)
|
|
(25.0
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Income (Loss) Before Income Taxes
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
(3,526
|
)
|
|
$
|
9,999
|
|
|
$
|
(13,525
|
)
|
|
(135.3
|
)%
|
Construction
|
(4,502
|
)
|
|
(6,361
|
)
|
|
1,859
|
|
|
29.2
|
%
|
|||
International
|
(3,425
|
)
|
|
(10,281
|
)
|
|
6,856
|
|
|
66.7
|
%
|
|||
Segment income (loss) before income taxes
|
(11,453
|
)
|
|
(6,643
|
)
|
|
(4,810
|
)
|
|
(72.4
|
)%
|
|||
Shared Resources
|
2,148
|
|
|
(171
|
)
|
|
2,319
|
|
|
1,356.1
|
%
|
|||
Income (Loss) Before Income Taxes
|
$
|
(9,305
|
)
|
|
$
|
(6,814
|
)
|
|
$
|
(2,491
|
)
|
|
(36.6
|
)%
|
|
Three Months Ended July 31,
|
|
Six Months Ended July 31,
|
||||||||||||
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
(dollars in thousands, except per share data)
|
||||||||||||||
Net Income (Loss) Attributable to Titan Machinery Inc. Common Stockholders
|
|
|
|
|
|
|
|
||||||||
Net Income (Loss) Attributable to Titan Machinery Inc. Common Stockholders
|
$
|
6
|
|
|
$
|
(603
|
)
|
|
$
|
(6,186
|
)
|
|
$
|
(7,049
|
)
|
Non-GAAP Adjustments
|
|
|
|
|
|
|
|
||||||||
Debt Issuance Cost Write-Off
|
—
|
|
|
—
|
|
|
318
|
|
|
—
|
|
||||
Realignment / Store Closing Costs
|
(62
|
)
|
|
130
|
|
|
882
|
|
|
2,038
|
|
||||
Ukraine Remeasurement
|
62
|
|
|
1,262
|
|
|
2,066
|
|
|
4,336
|
|
||||
Total Non-GAAP Adjustments
|
—
|
|
|
1,392
|
|
|
3,266
|
|
|
6,374
|
|
||||
Adjusted Net Loss Attributable to Titan Machinery Inc. Common Stockholders
|
$
|
6
|
|
|
$
|
789
|
|
|
$
|
(2,920
|
)
|
|
$
|
(675
|
)
|
|
|
|
|
|
|
|
|
||||||||
Earnings (Loss) per Share - Diluted
|
|
|
|
|
|
|
|
||||||||
Earnings (Loss) per Share - Diluted
|
$
|
0.00
|
|
|
$
|
(0.03
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(0.34
|
)
|
Non-GAAP Adjustments
|
|
|
|
|
|
|
|
||||||||
Debt Issuance Cost Write-Off
|
—
|
|
|
—
|
|
|
0.01
|
|
|
—
|
|
||||
Realignment / Store Closing Costs
|
—
|
|
|
0.01
|
|
|
0.04
|
|
|
0.10
|
|
||||
Ukraine Remeasurement
|
—
|
|
|
0.06
|
|
|
0.10
|
|
|
0.21
|
|
||||
Total Non-GAAP Adjustments
|
—
|
|
|
0.07
|
|
|
0.15
|
|
|
0.31
|
|
||||
Adjusted Earnings (Loss) per Share - Diluted
|
$
|
0.00
|
|
|
$
|
0.04
|
|
|
$
|
(0.14
|
)
|
|
$
|
(0.03
|
)
|
|
Net Cash Provided by (Used for) Operating Activities
|
|
Net Cash Provided by (Used for) Financing Activities
|
||||||||||||
|
Six Months Ended July 31, 2015
|
|
Six Months Ended July 31, 2014
|
|
Six Months Ended July 31, 2015
|
|
Six Months Ended July 31, 2014
|
||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||
Cash Flow, As Reported
|
$
|
185,569
|
|
|
$
|
(79,407
|
)
|
|
$
|
(215,727
|
)
|
|
$
|
100,800
|
|
Adjustment for Non-Manufacturer Floorplan Net Payments
|
(190,744
|
)
|
|
100,790
|
|
|
190,744
|
|
|
(100,790
|
)
|
||||
Adjustment for Constant Equity in Inventory
|
9,844
|
|
|
(54,225
|
)
|
|
—
|
|
|
—
|
|
||||
Non-GAAP Cash Flow
|
$
|
4,669
|
|
|
$
|
(32,842
|
)
|
|
$
|
(24,983
|
)
|
|
$
|
10
|
|
Dated:
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September 9, 2015
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TITAN MACHINERY INC.
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By
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/s/ Mark Kalvoda
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Mark Kalvoda
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Chief Financial Officer
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(Principal Financial Officer)
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No.
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Description
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10.1
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Amendment No. 2 to the Amended and Restated Wholesale Financing Plan, dated as of September 1, 2015, by and among the registrant and Agricredit Acceptance LLC
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10.2
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Titan Machinery Inc. Non-Employee Director Compensation Plan+
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10.3
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Amended and Restated Employment Agreement, dated September 4, 2015, between Mark Kalvoda and the registrant.+
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31.1
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Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
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31.2
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Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
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32.1
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Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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32.2
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Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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101
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Financial statements from the Quarterly Report on Form 10-Q of the Company for the quarter ended July 31, 2015, formatted in XBRL: (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Stockholders’ Equity, (iv) the Consolidated Statements of Cash Flows, and (v) the Notes to the Consolidated Financial Statements.
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1.
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Integration. Except as amended herein, the terms and conditions of the Agreement shall remain unchanged and in full force and effect. In the event of a conflict between the terms of this Amendment and the Agreement, the terms of this Amendment shall prevail. Capitalized terms used herein but not otherwise defined shall have the meanings ascribed to them in the Agreement.
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2.
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Amendment. The Agreement shall be amended as follows:
|
1.
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Standard Rate
. All accrued and unpaid interest is due and payable on the 25
th
of each month according to the following schedule: Unless otherwise announced by Secured Party, interest will accrue on the principal balance of all outstanding balances due hereunder from the date of the Dealer Wholesale Funding Request applicable to such Inventory and shall thereafter accrue on the unpaid balance at an annual rate (the “Standard Rate”), which for any particular month, shall be equal to the “LIBOR Rate” in effect for the first day of such month, plus:
|
a.
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If the average daily outstanding principal balance for the prior month is less than $35,000,000, then 4.36%;
|
b.
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If the average daily outstanding principal balance for the prior month is equal to $35,000,000 but less than $55,000,000, then 4.11%; or
|
c.
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If the average daily outstanding principal balance for the prior month is equal to or more than $55,000,000, then 3.86%.
|
“(c)
|
Withdrawals from the Pool
.
Debtor and Secured Party agree to use the credits from the Pool to (i) buy down Secured Party’s retail rates for use with Debtor’s retail customers who finance retail transactions with Secured Party, as agreed between the parties; and/or (ii) to create leasing and retail programs for Debtor’s retail customers who finance retail transactions with Secured Party, as agreed between the parties. Debtor and Secured Party also agree that Debtor may carry a negative balance up to $500,000 in the Pool. In the event that the Pool has a negative balance, Secured Party shall invoice Debtor for negative balance less a notional credit of eighty percent (80%) of the prior month’s contribution to the Pool acknowledging anticipated current month contributions. Secured Party will calculate the amount due, if any, at month end and invoice Debtor for such amounts by the 5
th
of the following month. Invoiced amounts shall be due and payable by the 15
th
day of that month.”
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3.
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Miscellaneous. This Amendment may be executed in counterparts, including facsimile counterparts, each of which will constitute an original, but which collectively will form one and the same instrument. This Amendment constitutes the final agreement between the Parties and is the exclusive expression of the Parties’ agreement on the matters contained herein. All earlier and contemporaneous negotiations and agreements between the Parties on the matters contained herein are expressly merged into and superseded by this Amendment. Any modification or additions to the terms of this Amendment must be in a written agreement identified as an amendment and executed by both Parties.
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IN WITNESS WHEREOF, the parties have executed this Amendment effective as of the date set forth on the first page of this Amendment.
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|||||
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Titan Machinery, Inc.,
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Agricredit Acceptance LLC,
At: 8001 Birchwood Court, Johnston, IA 50131
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Debtor
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|||||
/s/ Ted O. Christianson, Treasurer
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/s/ Douglas Kunert
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Authorized Signature
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Authorized Signature
|
||||
Ted O. Christianson, Treasurer
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9/1/15
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Douglas Kunert, Vice President-Risk
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9/2/2015
|
||
Print Name & Title
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Date
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Print Name & Title
|
Date
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Director Retainer
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$50,000
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Lead Independent Director
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$15,000
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Audit Committee Chair
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$25,000
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Governance & Compensation Committee Chairs
|
$10,000
|
Restricted Stock*
|
$70,000
|
* The actual number of shares delivered will be determined based upon the closing market price of Titan’s stock on the date of the Annual Meeting
|
i.
|
Material breach of this Agreement;
|
ii.
|
Willful refusal to perform your duties without justification, or willful misconduct or gross negligence in the performance of your duties under this Agreement;
|
iii.
|
A material breach by you of the Company’s material policies or codes of conduct or of your material obligations under any other agreement between you and the
|
iv.
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The willful engagement in dishonesty, fraud, illegal conduct, with respect to or in the course of the business or affairs of the Company, which materially and adversely harms the Company;
|
v.
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Conviction of, or a plea of nolo contendere to, a felony or other crime involving moral turpitude; and
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vi.
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Death or permanent disability.
|
i.
|
The assignment to you of material duties inconsistent with your status or position as Chief Financial Officer, or other action that results in a material change in your status, responsibilities, duties, authority, base salary, compensation, position, or change in reporting relationship;
|
ii.
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The relocation of your principal office for Company business to a location more than forty (40) miles from the Company’s current headquarters;
|
iii.
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Material breach by the Company of any terms or conditions of this Agreement; or
|
iv.
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The failure of the Company to require a successor to assume the terms of this Agreement.
|
i.
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One person (or more than one person acting as a group) acquires ownership of stock of the Company that, together with the stock held by such person or group, constitutes more than 50% of the total voting power of the stock of the Company;
|
ii.
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A majority of the members of the Board are replaced during any twelve-month period by directors whose appointment or election is not endorsed by a majority of the Board before the date of appointment or election; or
|
iii.
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The sale of all or substantially all of the Company’s assets.
|
i.
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signing and not revoking a full release of all claims against the Company, its affiliates, officers, directors, employees, agents and assigns, substantially in the form attached to this Agreement as
Exhibit A
, within 30 days of the termination event;
|
ii.
|
not directly or indirectly, whether on your own behalf or that of a third party (other than the Company), engaging in the business (whether as an owner of, or as employee, director or officer of or consultant to any business, other than the Company, that is engaged in the business), of owning or operating agricultural or construction equipment stores in any state or Canadian province in which the Company or its subsidiaries owns or operates any agricultural or construction equipment stores during the term of your employment;
|
iii.
|
not directly or indirectly, either for yourself or any other person or entity solicit, inducing, or attempting to induce any employee of the Company to leave the employ of the Company; and
|
iv.
|
complying with your obligations under the Release.
|
i.
|
all claims arising out of or relating to my employment with Titan or the termination of that employment;
|
ii.
|
all claims arising out of or relating to the statements, actions, or omissions of the Company;
|
iii.
|
all claims for any alleged unlawful discrimination, harassment, retaliation or reprisal, or other alleged unlawful practices arising under any federal, state, or local statute, ordinance, or regulation, including without limitation, claims under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with Disabilities Act, 42 U.S.C. § 1981, the Employee Retirement Income Security Act, the Equal Pay Act, the Worker Adjustment and Retraining Notification Act, the Sarbanes-Oxley Act, the Family and Medical Leave Act, the Fair Credit Reporting Act, the North Dakota Human Rights Act, N.D. Stat. § 14.02-4-01 et seq., the North Dakota Equal Pay Act, N.D. Stat. § 34-06.1-01 et seq., the North Dakota Age Discrimination Act, N.D. Stat. § 34-01-17, and workers’ compensation non-interference or non-retaliation statutes;
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iv.
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all claims for alleged wrongful discharge; breach of contract; breach of implied contract; failure to keep any promise; breach of a covenant of good faith and fair dealing; breach of fiduciary duty; estoppel; my activities, if any, as a “whistleblower”; defamation; infliction of emotional distress; fraud; misrepresentation; negligence; harassment; retaliation or reprisal; constructive discharge; assault; battery; false imprisonment; invasion of privacy; interference with contractual or business relationships; any other wrongful employment practices; and violation of any other principle of common law;
|
v.
|
all claims for compensation of any kind, including without limitation, bonuses, commissions, stock-based compensation or stock options, vacation pay and paid time off, perquisites, and expense reimbursements;
|
vi.
|
all claims for back pay, front pay, reinstatement, other equitable relief, compensatory damages, damages for alleged personal injury, liquidated damages, and punitive damages; and
|
vii.
|
all claims for attorneys’ fees, costs, and interest.
|
1.
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I have reviewed this report on Form 10-Q of Titan Machinery Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ David J. Meyer
|
|
David J. Meyer
|
|
Board Chair and Chief Executive Officer
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ Mark Kalvoda
|
|
Mark Kalvoda
|
|
Chief Financial Officer
|
|
/s/ David J. Meyer
|
|
David J. Meyer
|
|
Board Chair and Chief Executive Officer
|
|
/s/ Mark Kalvoda
|
|
Mark Kalvoda
|
|
Chief Financial Officer
|