|
Delaware
|
|
No. 45-0357838
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(State or Other Jurisdiction of
Incorporation or Organization)
|
|
(IRS Employer
Identification No.)
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|
|
||
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Page No.
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PART I.
|
FINANCIAL INFORMATION
|
|
ITEM 1.
|
FINANCIAL STATEMENTS
|
|
|
Consolidated Balance Sheets as of October 31, 2017 and January 31, 2017
|
|
|
Consolidated Statements of Operations for the three and nine months ended October 31, 2017 and 2016
|
|
|
Consolidated Statements of Comprehensive Income (Loss) for the three and nine months ended October 31, 2017 and 2016
|
|
|
Consolidated Statements of Cash Flows for the nine months ended October 31, 2017 and 2016
|
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Notes to Consolidated Financial Statements
|
|
ITEM 2.
|
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
|
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
|
PART II.
|
OTHER INFORMATION
|
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
|
ITEM 1A.
|
RISK FACTORS
|
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
|
ITEM 3.
|
DEFAULTS UPON SENIOR SECURITIES
|
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
|
ITEM 5.
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OTHER INFORMATION
|
|
ITEM 6.
|
EXHIBITS
|
|
Exhibit Index
|
|
|
Signatures
|
|
|
October 31, 2017
|
|
January 31, 2017
|
||||
Assets
|
|
|
|
|
|||
Current Assets
|
|
|
|
||||
Cash
|
$
|
43,861
|
|
|
$
|
53,151
|
|
Receivables (net of allowance of $3,233 and $3,630 as of October 31, 2017 and January 31, 2017, respectively)
|
73,605
|
|
|
60,082
|
|
||
Inventories
|
529,761
|
|
|
478,266
|
|
||
Prepaid expenses and other
|
8,363
|
|
|
10,989
|
|
||
Income taxes receivable
|
111
|
|
|
5,380
|
|
||
Total current assets
|
655,701
|
|
|
607,868
|
|
||
Noncurrent Assets
|
|
|
|
||||
Intangible assets, net of accumulated amortization
|
4,944
|
|
|
5,001
|
|
||
Property and equipment, net of accumulated depreciation
|
156,426
|
|
|
156,647
|
|
||
Deferred income taxes
|
271
|
|
|
547
|
|
||
Other
|
948
|
|
|
1,359
|
|
||
Total noncurrent assets
|
162,589
|
|
|
163,554
|
|
||
Total Assets
|
$
|
818,290
|
|
|
$
|
771,422
|
|
|
|
|
|
||||
Liabilities and Stockholders' Equity
|
|
|
|
||||
Current Liabilities
|
|
|
|
||||
Accounts payable
|
$
|
19,567
|
|
|
$
|
17,326
|
|
Floorplan payable
|
322,439
|
|
|
233,228
|
|
||
Current maturities of long-term debt
|
1,529
|
|
|
1,373
|
|
||
Customer deposits
|
15,111
|
|
|
26,366
|
|
||
Accrued expenses and other
|
27,298
|
|
|
30,533
|
|
||
Total current liabilities
|
385,944
|
|
|
308,826
|
|
||
Long-Term Liabilities
|
|
|
|
||||
Senior convertible notes
|
62,277
|
|
|
88,501
|
|
||
Long-term debt, less current maturities
|
35,892
|
|
|
38,236
|
|
||
Deferred income taxes
|
4,806
|
|
|
9,500
|
|
||
Other long-term liabilities
|
10,216
|
|
|
5,180
|
|
||
Total long-term liabilities
|
113,191
|
|
|
141,417
|
|
||
Commitments and Contingencies
|
|
|
|
|
|
||
Stockholders' Equity
|
|
|
|
||||
Common stock, par value $.00001 per share, 45,000 shares authorized; 22,042 shares issued and outstanding at October 31, 2017; 21,836 shares issued and outstanding at January 31, 2017
|
—
|
|
|
—
|
|
||
Additional paid-in-capital
|
245,140
|
|
|
240,615
|
|
||
Retained earnings
|
75,361
|
|
|
85,347
|
|
||
Accumulated other comprehensive loss
|
(1,346
|
)
|
|
(4,783
|
)
|
||
Total stockholders' equity
|
319,155
|
|
|
321,179
|
|
||
Total Liabilities and Stockholders' Equity
|
$
|
818,290
|
|
|
$
|
771,422
|
|
|
Three Months Ended October 31,
|
|
Nine Months Ended October 31,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Revenue
|
|
|
|
|
|
|
|
||||||||
Equipment
|
$
|
215,956
|
|
|
$
|
212,194
|
|
|
$
|
551,752
|
|
|
$
|
570,369
|
|
Parts
|
64,729
|
|
|
69,261
|
|
|
176,892
|
|
|
185,106
|
|
||||
Service
|
31,532
|
|
|
33,777
|
|
|
90,807
|
|
|
96,065
|
|
||||
Rental and other
|
18,124
|
|
|
17,034
|
|
|
43,879
|
|
|
43,919
|
|
||||
Total Revenue
|
330,341
|
|
|
332,266
|
|
|
863,330
|
|
|
895,459
|
|
||||
Cost of Revenue
|
|
|
|
|
|
|
|
||||||||
Equipment
|
199,154
|
|
|
201,140
|
|
|
509,400
|
|
|
532,370
|
|
||||
Parts
|
45,408
|
|
|
48,387
|
|
|
124,868
|
|
|
130,006
|
|
||||
Service
|
11,139
|
|
|
11,828
|
|
|
33,377
|
|
|
35,473
|
|
||||
Rental and other
|
13,163
|
|
|
12,485
|
|
|
32,482
|
|
|
32,703
|
|
||||
Total Cost of Revenue
|
268,864
|
|
|
273,840
|
|
|
700,127
|
|
|
730,552
|
|
||||
Gross Profit
|
61,477
|
|
|
58,426
|
|
|
163,203
|
|
|
164,907
|
|
||||
Operating Expenses
|
50,374
|
|
|
53,143
|
|
|
152,884
|
|
|
159,132
|
|
||||
Restructuring Costs
|
2,587
|
|
|
275
|
|
|
10,480
|
|
|
546
|
|
||||
Income (Loss) from Operations
|
8,516
|
|
|
5,008
|
|
|
(161
|
)
|
|
5,229
|
|
||||
Other Income (Expense)
|
|
|
|
|
|
|
|
||||||||
Interest income and other income
|
380
|
|
|
502
|
|
|
1,840
|
|
|
1,251
|
|
||||
Floorplan interest expense
|
(1,900
|
)
|
|
(3,294
|
)
|
|
(6,719
|
)
|
|
(10,843
|
)
|
||||
Other interest expense
|
(2,110
|
)
|
|
(2,160
|
)
|
|
(6,694
|
)
|
|
(5,930
|
)
|
||||
Income (Loss) Before Income Taxes
|
4,886
|
|
|
56
|
|
|
(11,734
|
)
|
|
(10,293
|
)
|
||||
Provision for (Benefit from) Income Taxes
|
2,502
|
|
|
(208
|
)
|
|
(3,000
|
)
|
|
(3,997
|
)
|
||||
Net Income (Loss) Including Noncontrolling Interest
|
$
|
2,384
|
|
|
$
|
264
|
|
|
$
|
(8,734
|
)
|
|
$
|
(6,296
|
)
|
Less: Loss Attributable to Noncontrolling Interest
|
—
|
|
|
—
|
|
|
—
|
|
|
(356
|
)
|
||||
Net Income (Loss) Attributable to Titan Machinery Inc.
|
$
|
2,384
|
|
|
$
|
264
|
|
|
$
|
(8,734
|
)
|
|
$
|
(5,940
|
)
|
Net (Income) Loss Allocated to Participating Securities - Note 1
|
(56
|
)
|
|
(8
|
)
|
|
176
|
|
|
120
|
|
||||
Net Income (Loss) Attributable to Titan Machinery Inc. Common Stockholders
|
$
|
2,328
|
|
|
$
|
256
|
|
|
$
|
(8,558
|
)
|
|
$
|
(5,820
|
)
|
Earnings (Loss) per Share - Note 1
|
|
|
|
|
|
|
|
||||||||
Earnings (Loss) per Share - Basic
|
$
|
0.11
|
|
|
$
|
0.01
|
|
|
$
|
(0.40
|
)
|
|
$
|
(0.27
|
)
|
Earnings (Loss) per Share - Diluted
|
$
|
0.11
|
|
|
$
|
0.01
|
|
|
$
|
(0.40
|
)
|
|
$
|
(0.27
|
)
|
Weighted Average Common Shares - Basic
|
21,585
|
|
|
21,218
|
|
|
21,503
|
|
|
21,208
|
|
||||
Weighted Average Common Shares - Diluted
|
21,643
|
|
|
21,269
|
|
|
21,503
|
|
|
21,208
|
|
|
Three Months Ended October 31,
|
|
Nine Months Ended October 31,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Net Income (Loss) Including Noncontrolling Interest
|
$
|
2,384
|
|
|
$
|
264
|
|
|
$
|
(8,734
|
)
|
|
$
|
(6,296
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
1,369
|
|
|
626
|
|
|
2,760
|
|
|
945
|
|
||||
Unrealized gain (loss) on interest rate swap cash flow hedge derivative instrument, net of tax expense (benefit) of $91 for the three months ended October 31, 2016, and $19 and ($109) for the nine months ended October 31, 2017 and 2016
|
—
|
|
|
137
|
|
|
29
|
|
|
(163
|
)
|
||||
Reclassification of loss on interest rate swap cash flow hedge derivative instrument included in net loss, net of tax benefit of $39 and $133 for the three months ended October 31, 2017 and 2016, and $433 and $426 for the nine months ended October 31, 2017 and 2016
|
59
|
|
|
200
|
|
|
651
|
|
|
638
|
|
||||
Total Other Comprehensive Income
|
1,428
|
|
|
963
|
|
|
3,440
|
|
|
1,420
|
|
||||
Comprehensive Income (Loss)
|
3,812
|
|
|
1,227
|
|
|
(5,294
|
)
|
|
(4,876
|
)
|
||||
Comprehensive Loss Attributable to Noncontrolling Interest
|
—
|
|
|
—
|
|
|
—
|
|
|
(333
|
)
|
||||
Comprehensive Income (Loss) Attributable To Titan Machinery Inc.
|
$
|
3,812
|
|
|
$
|
1,227
|
|
|
$
|
(5,294
|
)
|
|
$
|
(4,543
|
)
|
|
Nine Months Ended October 31,
|
||||||
|
2017
|
|
2016
|
||||
Operating Activities
|
|
|
|
||||
Net loss including noncontrolling interest
|
$
|
(8,734
|
)
|
|
$
|
(6,296
|
)
|
Adjustments to reconcile net loss including noncontrolling interest to net cash provided by operating activities
|
|
|
|
||||
Depreciation and amortization
|
18,949
|
|
|
19,896
|
|
||
Impairment
|
131
|
|
|
275
|
|
||
Deferred income taxes
|
(3,121
|
)
|
|
825
|
|
||
Stock-based compensation expense
|
2,478
|
|
|
1,805
|
|
||
Noncash interest expense
|
2,917
|
|
|
4,305
|
|
||
Unrealized foreign currency gain on loans to international subsidiaries
|
(1,115
|
)
|
|
(44
|
)
|
||
Gain on repurchase of senior convertible notes
|
(22
|
)
|
|
(3,130
|
)
|
||
Other, net
|
(548
|
)
|
|
(980
|
)
|
||
Changes in assets and liabilities
|
|
|
|
||||
Receivables, prepaid expenses and other assets
|
(9,784
|
)
|
|
(18,070
|
)
|
||
Inventories
|
(41,748
|
)
|
|
91,222
|
|
||
Manufacturer floorplan payable
|
97,734
|
|
|
(20,821
|
)
|
||
Accounts payable, customer deposits, accrued expenses and other and other long-term liabilities
|
(7,328
|
)
|
|
(2,546
|
)
|
||
Income taxes
|
6,222
|
|
|
7,957
|
|
||
Net Cash Provided by Operating Activities
|
56,031
|
|
|
74,398
|
|
||
Investing Activities
|
|
|
|
||||
Rental fleet purchases
|
(11,784
|
)
|
|
(3,094
|
)
|
||
Property and equipment purchases (excluding rental fleet)
|
(12,129
|
)
|
|
(7,121
|
)
|
||
Proceeds from sale of property and equipment
|
4,564
|
|
|
2,285
|
|
||
Proceeds from insurance recoveries
|
—
|
|
|
1,431
|
|
||
Other, net
|
430
|
|
|
(517
|
)
|
||
Net Cash Used for Investing Activities
|
(18,919
|
)
|
|
(7,016
|
)
|
||
Financing Activities
|
|
|
|
||||
Net change in non-manufacturer floorplan payable
|
(14,357
|
)
|
|
(54,478
|
)
|
||
Repurchase of senior convertible notes
|
(29,093
|
)
|
|
(46,013
|
)
|
||
Proceeds from long-term debt borrowings
|
33,000
|
|
|
—
|
|
||
Principal payments on long-term debt
|
(36,121
|
)
|
|
(1,935
|
)
|
||
Payment of debt issuance costs
|
(27
|
)
|
|
(31
|
)
|
||
Loan provided to non-controlling interest holder
|
—
|
|
|
(2,148
|
)
|
||
Other, net
|
(341
|
)
|
|
(33
|
)
|
||
Net Cash Used for Financing Activities
|
(46,939
|
)
|
|
(104,638
|
)
|
||
Effect of Exchange Rate Changes on Cash
|
537
|
|
|
222
|
|
||
Net Change in Cash
|
(9,290
|
)
|
|
(37,034
|
)
|
||
Cash at Beginning of Period
|
53,151
|
|
|
89,465
|
|
||
Cash at End of Period
|
$
|
43,861
|
|
|
$
|
52,431
|
|
Supplemental Disclosures of Cash Flow Information
|
|
|
|
||||
Cash paid (received) during the period
|
|
|
|
||||
Income tax refunds, net of payments
|
$
|
(5,768
|
)
|
|
$
|
(12,942
|
)
|
Interest
|
$
|
11,254
|
|
|
$
|
15,544
|
|
Supplemental Disclosures of Noncash Investing and Financing Activities
|
|
|
|
||||
Net property and equipment financed with long-term debt, accounts payable and accrued expenses and other
|
$
|
729
|
|
|
$
|
2,818
|
|
Net transfer of assets from property and equipment to inventories
|
$
|
(3,010
|
)
|
|
$
|
(4,411
|
)
|
Acquisition of non-controlling interest through satisfaction of outstanding receivables
|
$
|
—
|
|
|
$
|
4,324
|
|
|
Three Months Ended October 31,
|
|
Nine Months Ended October 31,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(in thousands, except per share data)
|
|
(in thousands, except per share data)
|
||||||||||||
Basic Weighted-Average Common Shares Outstanding
|
21,585
|
|
|
21,218
|
|
|
21,503
|
|
|
21,208
|
|
||||
Plus: Incremental Shares From Assumed Exercise of Stock Options
|
58
|
|
|
51
|
|
|
—
|
|
|
—
|
|
||||
Diluted Weighted-Average Common Shares Outstanding
|
21,643
|
|
|
21,269
|
|
|
21,503
|
|
|
21,208
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Anti-Dilutive Shares Excluded From Diluted Weighted-Average Common Shares Outstanding:
|
|
|
|
|
|
|
|
||||||||
Stock Options
|
103
|
|
|
141
|
|
|
106
|
|
|
146
|
|
||||
Shares Underlying Senior Convertible Notes (conversion price of $43.17)
|
1,521
|
|
|
2,217
|
|
|
1,521
|
|
|
2,217
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Earnings (Loss) per Share - Basic
|
$
|
0.11
|
|
|
$
|
0.01
|
|
|
$
|
(0.40
|
)
|
|
$
|
(0.27
|
)
|
Earnings (Loss) per Share - Diluted
|
$
|
0.11
|
|
|
$
|
0.01
|
|
|
$
|
(0.40
|
)
|
|
$
|
(0.27
|
)
|
|
As of February 1, 2017
|
||||||||||
|
Balance Sheet Classification
|
||||||||||
|
Additional paid-in capital
|
|
Deferred income tax liability
|
|
Retained earnings
|
||||||
|
(in thousands)
|
||||||||||
|
Increase (Decrease)
|
||||||||||
Impact of cumulative-effect adjustment from adoption of ASU 2016-09
|
$
|
2,087
|
|
|
$
|
(835
|
)
|
|
$
|
(1,252
|
)
|
|
October 31, 2017
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
New equipment
|
$
|
343,434
|
|
|
$
|
235,161
|
|
Used equipment
|
114,499
|
|
|
160,503
|
|
||
Parts and attachments
|
70,170
|
|
|
81,734
|
|
||
Work in process
|
1,658
|
|
|
868
|
|
||
|
$
|
529,761
|
|
|
$
|
478,266
|
|
|
October 31, 2017
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
Rental fleet equipment
|
$
|
125,533
|
|
|
$
|
124,417
|
|
Machinery and equipment
|
21,701
|
|
|
22,255
|
|
||
Vehicles
|
37,558
|
|
|
36,384
|
|
||
Furniture and fixtures
|
39,334
|
|
|
39,875
|
|
||
Land, buildings, and leasehold improvements
|
63,652
|
|
|
59,481
|
|
||
|
287,778
|
|
|
282,412
|
|
||
Less accumulated depreciation
|
(131,352
|
)
|
|
(125,765
|
)
|
||
|
$
|
156,426
|
|
|
$
|
156,647
|
|
|
October 31, 2017
|
|
January 31, 2017
|
||||
|
(in thousands except conversion
rate and conversion price)
|
||||||
Principal value
|
$
|
65,644
|
|
|
$
|
95,725
|
|
Unamortized debt discount
|
(2,973
|
)
|
|
(6,368
|
)
|
||
Unamortized debt issuance costs
|
(394
|
)
|
|
(856
|
)
|
||
Carrying value of senior convertible notes
|
$
|
62,277
|
|
|
$
|
88,501
|
|
|
|
|
|
||||
Carrying value of equity component, net of deferred taxes
|
$
|
14,923
|
|
|
$
|
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 October 31,
|
|
Nine Months Ended October 31,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(in thousands)
|
(in thousands)
|
|||||||||||||
Cash Interest Expense
|
|
|
|
|
|
|
|
||||||||
Coupon interest expense
|
$
|
666
|
|
|
$
|
996
|
|
|
$
|
2,157
|
|
|
$
|
3,457
|
|
Noncash Interest Expense
|
|
|
|
|
|
|
|
||||||||
Amortization of debt discount
|
517
|
|
|
703
|
|
|
1,628
|
|
|
2,406
|
|
||||
Amortization of transaction costs
|
71
|
|
|
100
|
|
|
225
|
|
|
347
|
|
||||
|
$
|
1,254
|
|
|
$
|
1,799
|
|
|
$
|
4,010
|
|
|
$
|
6,210
|
|
|
Notional Amount as of:
|
||||||
|
October 31, 2017
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
Cash flow hedges:
|
|
|
|
||||
Interest rate swap
|
$
|
—
|
|
|
$
|
100,000
|
|
Derivatives not designated as hedging instruments:
|
|
|
|
||||
Foreign currency contracts
|
10,000
|
|
|
18,021
|
|
|
Fair Value as of:
|
||||||
|
October 31, 2017
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
Liability Derivatives:
|
|
|
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
||||
Cash flow hedges:
|
|
|
|
||||
Interest rate swap
|
$
|
—
|
|
|
$
|
1,155
|
|
Derivatives not designated as hedging instruments:
|
|
|
|
||||
Foreign currency contracts
|
65
|
|
|
200
|
|
||
Total Liability Derivatives
|
$
|
65
|
|
|
$
|
1,355
|
|
|
|
October 31, 2017
|
|
January 31, 2017
|
||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||||||||||||||||||
Financial Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Interest rate swap
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,155
|
|
|
$
|
—
|
|
|
$
|
1,155
|
|
Foreign currency contracts
|
—
|
|
|
65
|
|
|
—
|
|
|
65
|
|
|
—
|
|
|
200
|
|
|
—
|
|
|
200
|
|
||||||||
Total Financial Liabilities
|
$
|
—
|
|
|
$
|
65
|
|
|
$
|
—
|
|
|
$
|
65
|
|
|
$
|
—
|
|
|
$
|
1,355
|
|
|
$
|
—
|
|
|
$
|
1,355
|
|
|
October 31, 2017
|
|
January 31, 2017
|
||||||||||||||||||||
|
Estimated Fair Value
|
|
Carrying Value
|
|
Face Value
|
|
Estimated Fair Value
|
|
Carrying Value
|
|
Face Value
|
||||||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||||||||||
Senior convertible notes
|
$
|
65,000
|
|
|
$
|
62,277
|
|
|
$
|
65,644
|
|
|
$
|
87,000
|
|
|
$
|
88,501
|
|
|
$
|
95,725
|
|
|
Three Months Ended October 31,
|
|
Nine Months Ended October 31,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||
Revenue
|
|
|
|
|
|
|
|
||||||||
Agriculture
|
$
|
186,546
|
|
|
$
|
205,540
|
|
|
$
|
488,716
|
|
|
$
|
538,060
|
|
Construction
|
72,942
|
|
|
80,789
|
|
|
214,252
|
|
|
241,922
|
|
||||
International
|
70,853
|
|
|
45,937
|
|
|
160,362
|
|
|
115,477
|
|
||||
Total
|
$
|
330,341
|
|
|
$
|
332,266
|
|
|
$
|
863,330
|
|
|
$
|
895,459
|
|
|
|
|
|
|
|
|
|
||||||||
Income (Loss) Before Income Taxes
|
|
|
|
|
|
|
|
||||||||
Agriculture
|
$
|
4,909
|
|
|
$
|
(1,798
|
)
|
|
$
|
(5,870
|
)
|
|
$
|
(9,881
|
)
|
Construction
|
(2,373
|
)
|
|
(105
|
)
|
|
(4,076
|
)
|
|
(1,523
|
)
|
||||
International
|
2,453
|
|
|
604
|
|
|
3,331
|
|
|
(88
|
)
|
||||
Segment income (loss) before income taxes
|
4,989
|
|
|
(1,299
|
)
|
|
(6,615
|
)
|
|
(11,492
|
)
|
||||
Shared Resources
|
(103
|
)
|
|
1,355
|
|
|
(5,119
|
)
|
|
1,199
|
|
||||
Total
|
$
|
4,886
|
|
|
$
|
56
|
|
|
$
|
(11,734
|
)
|
|
$
|
(10,293
|
)
|
|
October 31, 2017
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
Total Assets
|
|
|
|
||||
Agriculture
|
$
|
404,200
|
|
|
$
|
411,726
|
|
Construction
|
244,725
|
|
|
221,092
|
|
||
International
|
126,706
|
|
|
106,899
|
|
||
Segment assets
|
775,631
|
|
|
739,717
|
|
||
Shared Resources
|
42,659
|
|
|
31,705
|
|
||
Total
|
$
|
818,290
|
|
|
$
|
771,422
|
|
|
Three Months Ended October 31, 2017
|
|
Nine Months Ended October 31, 2017
|
|
Cumulative Amount
|
||||||
|
(in thousands)
|
||||||||||
Lease accrual and termination costs
|
$
|
1,598
|
|
|
$
|
5,920
|
|
|
$
|
5,920
|
|
Termination benefits
|
943
|
|
|
4,667
|
|
|
4,667
|
|
|||
Impairment of fixed assets, net of gains on asset disposition
|
(55
|
)
|
|
(620
|
)
|
|
2,337
|
|
|||
Asset relocation and other costs
|
101
|
|
|
513
|
|
|
561
|
|
|||
|
$
|
2,587
|
|
|
$
|
10,480
|
|
|
$
|
13,485
|
|
|
Three Months Ended October 31, 2017
|
|
Nine Months Ended October 31, 2017
|
|
Cumulative Amount
|
||||||
|
(in thousands)
|
||||||||||
Segment
|
|
|
|
|
|
||||||
Agriculture
|
$
|
567
|
|
|
$
|
7,239
|
|
|
$
|
8,342
|
|
Construction
|
1,671
|
|
|
2,009
|
|
|
3,911
|
|
|||
International
|
60
|
|
|
60
|
|
|
60
|
|
|||
Shared Resources
|
289
|
|
|
1,172
|
|
|
1,172
|
|
|||
Total
|
$
|
2,587
|
|
|
$
|
10,480
|
|
|
$
|
13,485
|
|
|
Lease Accrual & Termination Costs
|
|
Termination Benefits
|
|
Asset Relocation & Other Costs
|
|
Total
|
||||||||
|
(in thousands)
|
|
|
||||||||||||
Balance, January 31, 2017
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Exit costs incurred and charged to expense
|
5,920
|
|
|
4,361
|
|
|
513
|
|
|
10,794
|
|
||||
Exit costs paid
|
(427
|
)
|
|
(3,697
|
)
|
|
(513
|
)
|
|
(4,637
|
)
|
||||
Balance, October 31, 2017
|
$
|
5,493
|
|
|
$
|
664
|
|
|
$
|
—
|
|
|
$
|
6,157
|
|
•
|
Revenue remained relatively flat for the
third
quarter of fiscal
2018
, as compared to the
third
quarter last year. Revenue was negatively impacted by our store closings associated with our Fiscal 2018 Restructuring Plan, and also impacted by the incremental revenue associated with our expanded marketing of aged equipment inventory during fiscal 2017, but was largely offset by increased revenues in our International segment.
|
•
|
Total gross profit margin increased to
18.6%
for the
third
quarter of fiscal
2018
, as compared to
17.6%
for the
third
quarter of fiscal
2017
. The increase in gross profit margin was primarily the result of higher gross profit margins on equipment revenues.
|
•
|
Floorplan interest expense
decreased
42.3%
in the
third
quarter of fiscal
2018
, as compared to the
third
quarter last year, primarily due to a decrease in our average interest-bearing inventory in the
third
quarter of fiscal
2018
.
|
•
|
Restructuring costs amounted to
$2.6 million
in the
third
quarter of fiscal
2018
. See the Fiscal 2018 Restructuring Plan section below for further details.
|
|
Three Months Ended October 31,
|
|
Nine Months Ended October 31,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(dollars in thousands)
|
|
(dollars in thousands)
|
||||||||||||
Equipment
|
|
|
|
|
|
|
|
|
|
||||||
Revenue
|
$
|
215,956
|
|
|
$
|
212,194
|
|
|
$
|
551,752
|
|
|
$
|
570,369
|
|
Cost of revenue
|
199,154
|
|
|
201,140
|
|
|
509,400
|
|
|
532,370
|
|
||||
Gross profit
|
$
|
16,802
|
|
|
$
|
11,054
|
|
|
$
|
42,352
|
|
|
$
|
37,999
|
|
Gross profit margin
|
7.8
|
%
|
|
5.2
|
%
|
|
7.7
|
%
|
|
6.7
|
%
|
||||
Parts
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
|
64,729
|
|
|
$
|
69,261
|
|
|
$
|
176,892
|
|
|
$
|
185,106
|
|
Cost of revenue
|
45,408
|
|
|
48,387
|
|
|
124,868
|
|
|
130,006
|
|
||||
Gross profit
|
$
|
19,321
|
|
|
$
|
20,874
|
|
|
$
|
52,024
|
|
|
$
|
55,100
|
|
Gross profit margin
|
29.8
|
%
|
|
30.1
|
%
|
|
29.4
|
%
|
|
29.8
|
%
|
||||
Service
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
|
31,532
|
|
|
$
|
33,777
|
|
|
$
|
90,807
|
|
|
$
|
96,065
|
|
Cost of revenue
|
11,139
|
|
|
11,828
|
|
|
33,377
|
|
|
35,473
|
|
||||
Gross profit
|
$
|
20,393
|
|
|
$
|
21,949
|
|
|
$
|
57,430
|
|
|
$
|
60,592
|
|
Gross profit margin
|
64.7
|
%
|
|
65.0
|
%
|
|
63.2
|
%
|
|
63.1
|
%
|
||||
Rental and other
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
|
18,124
|
|
|
$
|
17,034
|
|
|
$
|
43,879
|
|
|
$
|
43,919
|
|
Cost of revenue
|
13,163
|
|
|
12,485
|
|
|
32,482
|
|
|
32,703
|
|
||||
Gross profit
|
$
|
4,961
|
|
|
$
|
4,549
|
|
|
$
|
11,397
|
|
|
$
|
11,216
|
|
Gross profit margin
|
27.4
|
%
|
|
26.7
|
%
|
|
26.0
|
%
|
|
25.5
|
%
|
|
Three Months Ended October 31,
|
|
Nine Months Ended October 31,
|
||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||
Revenue
|
|
|
|
|
|
|
|
|
|
||
Equipment
|
65.4
|
%
|
|
63.9
|
%
|
|
63.9
|
%
|
|
63.7
|
%
|
Parts
|
19.6
|
%
|
|
20.8
|
%
|
|
20.5
|
%
|
|
20.7
|
%
|
Service
|
9.5
|
%
|
|
10.2
|
%
|
|
10.5
|
%
|
|
10.7
|
%
|
Rental and other
|
5.5
|
%
|
|
5.1
|
%
|
|
5.1
|
%
|
|
4.9
|
%
|
Total Revenue
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Total Cost of Revenue
|
81.4
|
%
|
|
82.4
|
%
|
|
81.1
|
%
|
|
81.6
|
%
|
Gross Profit Margin
|
18.6
|
%
|
|
17.6
|
%
|
|
18.9
|
%
|
|
18.4
|
%
|
Operating Expenses
|
15.2
|
%
|
|
16.0
|
%
|
|
17.7
|
%
|
|
17.7
|
%
|
Restructuring Costs
|
0.8
|
%
|
|
0.1
|
%
|
|
1.2
|
%
|
|
0.1
|
%
|
Income (Loss) from Operations
|
2.6
|
%
|
|
1.5
|
%
|
|
—
|
%
|
|
0.6
|
%
|
Other Income (Expense)
|
(1.1
|
)%
|
|
(1.5
|
)%
|
|
(1.4
|
)%
|
|
(1.7
|
)%
|
Income (Loss) Before Income Taxes
|
1.5
|
%
|
|
—
|
%
|
|
(1.4
|
)%
|
|
(1.1
|
)%
|
Provision for (Benefit from) Income Taxes
|
0.8
|
%
|
|
(0.1
|
)%
|
|
(0.4
|
)%
|
|
(0.4
|
)%
|
Net Income (Loss) Including Noncontrolling Interest
|
0.7
|
%
|
|
0.1
|
%
|
|
(1.0
|
)%
|
|
(0.7
|
)%
|
Less: Loss Attributable to Noncontrolling Interest
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Net Income (Loss) Attributable to Titan Machinery Inc.
|
0.7
|
%
|
|
0.1
|
%
|
|
(1.0
|
)%
|
|
(0.7
|
)%
|
|
Three Months Ended October 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|
||||||||||
Equipment
|
$
|
215,956
|
|
|
$
|
212,194
|
|
|
$
|
3,762
|
|
|
1.8
|
%
|
Parts
|
64,729
|
|
|
69,261
|
|
|
(4,532
|
)
|
|
(6.5
|
)%
|
|||
Service
|
31,532
|
|
|
33,777
|
|
|
(2,245
|
)
|
|
(6.6
|
)%
|
|||
Rental and other
|
18,124
|
|
|
17,034
|
|
|
1,090
|
|
|
6.4
|
%
|
|||
Total Revenue
|
$
|
330,341
|
|
|
$
|
332,266
|
|
|
$
|
(1,925
|
)
|
|
(0.6
|
)%
|
|
Three Months Ended October 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|
||||||||||
Gross Profit
|
|
|
|
|
|
|
|
|||||||
Equipment
|
$
|
16,802
|
|
|
$
|
11,054
|
|
|
$
|
5,748
|
|
|
52.0
|
%
|
Parts
|
19,321
|
|
|
20,874
|
|
|
(1,553
|
)
|
|
(7.4
|
)%
|
|||
Service
|
20,393
|
|
|
21,949
|
|
|
(1,556
|
)
|
|
(7.1
|
)%
|
|||
Rental and other
|
4,961
|
|
|
4,549
|
|
|
412
|
|
|
9.1
|
%
|
|||
Total Gross Profit
|
$
|
61,477
|
|
|
$
|
58,426
|
|
|
$
|
3,051
|
|
|
5.2
|
%
|
Gross Profit Margin
|
|
|
|
|
|
|
|
|||||||
Equipment
|
7.8
|
%
|
|
5.2
|
%
|
|
2.6
|
%
|
|
50.0
|
%
|
|||
Parts
|
29.8
|
%
|
|
30.1
|
%
|
|
(0.3
|
)%
|
|
(1.0
|
)%
|
|||
Service
|
64.7
|
%
|
|
65.0
|
%
|
|
(0.3
|
)%
|
|
(0.5
|
)%
|
|||
Rental and other
|
27.4
|
%
|
|
26.7
|
%
|
|
0.7
|
%
|
|
2.6
|
%
|
|||
Total Gross Profit Margin
|
18.6
|
%
|
|
17.6
|
%
|
|
1.0
|
%
|
|
5.7
|
%
|
|||
Gross Profit Mix
|
|
|
|
|
|
|
|
|||||||
Equipment
|
27.3
|
%
|
|
18.9
|
%
|
|
8.4
|
%
|
|
44.4
|
%
|
|||
Parts
|
31.4
|
%
|
|
35.7
|
%
|
|
(4.3
|
)%
|
|
(12.0
|
)%
|
|||
Service
|
33.2
|
%
|
|
37.6
|
%
|
|
(4.4
|
)%
|
|
(11.7
|
)%
|
|||
Rental and other
|
8.1
|
%
|
|
7.8
|
%
|
|
0.3
|
%
|
|
3.8
|
%
|
|||
Total Gross Profit Mix
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
|
|
Three Months Ended October 31,
|
|
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Operating Expenses
|
$
|
50,374
|
|
|
$
|
53,143
|
|
|
$
|
(2,769
|
)
|
|
(5.2
|
)%
|
Operating Expenses as a Percentage of Revenue
|
15.2
|
%
|
|
16.0
|
%
|
|
(0.8
|
)%
|
|
(5.0
|
)%
|
|
Three Months Ended October 31,
|
|
|
|
Percent
|
||||||||
|
2017
|
|
2016
|
|
Increase
|
|
Change
|
||||||
|
(dollars in thousands)
|
|
|
||||||||||
Restructuring Costs
|
$
|
2,587
|
|
|
$
|
275
|
|
|
$
|
2,312
|
|
|
n/m
|
|
Three Months Ended October 31,
|
|
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Interest income and other income
|
$
|
380
|
|
|
$
|
502
|
|
|
$
|
(122
|
)
|
|
(24.3
|
)%
|
Floorplan interest expense
|
(1,900
|
)
|
|
(3,294
|
)
|
|
(1,394
|
)
|
|
(42.3
|
)%
|
|||
Other interest expense
|
(2,110
|
)
|
|
(2,160
|
)
|
|
(50
|
)
|
|
(2.3
|
)%
|
|
Three Months Ended October 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Provision for (Benefit from) Income Taxes
|
$
|
2,502
|
|
|
$
|
(208
|
)
|
|
$
|
(2,710
|
)
|
|
(1,302.9
|
)%
|
|
Three Months Ended October 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Revenue
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
186,546
|
|
|
$
|
205,540
|
|
|
$
|
(18,994
|
)
|
|
(9.2
|
)%
|
Construction
|
72,942
|
|
|
80,789
|
|
|
(7,847
|
)
|
|
(9.7
|
)%
|
|||
International
|
70,853
|
|
|
45,937
|
|
|
24,916
|
|
|
54.2
|
%
|
|||
Total
|
$
|
330,341
|
|
|
$
|
332,266
|
|
|
$
|
(1,925
|
)
|
|
(0.6
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Income (Loss) Before Income Taxes
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
4,909
|
|
|
$
|
(1,798
|
)
|
|
$
|
6,707
|
|
|
373.0
|
%
|
Construction
|
(2,373
|
)
|
|
(105
|
)
|
|
(2,268
|
)
|
|
*N/M
|
|
|||
International
|
2,453
|
|
|
604
|
|
|
1,849
|
|
|
306.1
|
%
|
|||
Segment income (loss) before income taxes
|
4,989
|
|
|
(1,299
|
)
|
|
6,288
|
|
|
484.1
|
%
|
|||
Shared Resources
|
(103
|
)
|
|
1,355
|
|
|
(1,458
|
)
|
|
(107.6
|
)%
|
|||
Total
|
$
|
4,886
|
|
|
$
|
56
|
|
|
$
|
4,830
|
|
|
*N/M
|
|
|
Nine Months Ended October 31,
|
|
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
Decrease
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|
||||||||||
Equipment
|
$
|
551,752
|
|
|
$
|
570,369
|
|
|
$
|
(18,617
|
)
|
|
(3.3
|
)%
|
Parts
|
176,892
|
|
|
185,106
|
|
|
(8,214
|
)
|
|
(4.4
|
)%
|
|||
Service
|
90,807
|
|
|
96,065
|
|
|
(5,258
|
)
|
|
(5.5
|
)%
|
|||
Rental and other
|
43,879
|
|
|
43,919
|
|
|
(40
|
)
|
|
(0.1
|
)%
|
|||
Total Revenue
|
$
|
863,330
|
|
|
$
|
895,459
|
|
|
$
|
(32,129
|
)
|
|
(3.6
|
)%
|
|
Nine Months Ended October 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|
||||||||||
Gross Profit
|
|
|
|
|
|
|
|
|||||||
Equipment
|
$
|
42,352
|
|
|
$
|
37,999
|
|
|
$
|
4,353
|
|
|
11.5
|
%
|
Parts
|
52,024
|
|
|
55,100
|
|
|
(3,076
|
)
|
|
(5.6
|
)%
|
|||
Service
|
57,430
|
|
|
60,592
|
|
|
(3,162
|
)
|
|
(5.2
|
)%
|
|||
Rental and other
|
11,397
|
|
|
11,216
|
|
|
181
|
|
|
1.6
|
%
|
|||
Total Gross Profit
|
$
|
163,203
|
|
|
$
|
164,907
|
|
|
$
|
(1,704
|
)
|
|
(1.0
|
)%
|
Gross Profit Margin
|
|
|
|
|
|
|
|
|||||||
Equipment
|
7.7
|
%
|
|
6.7
|
%
|
|
1.0
|
%
|
|
14.9
|
%
|
|||
Parts
|
29.4
|
%
|
|
29.8
|
%
|
|
(0.4
|
)%
|
|
(1.3
|
)%
|
|||
Service
|
63.2
|
%
|
|
63.1
|
%
|
|
0.1
|
%
|
|
0.2
|
%
|
|||
Rental and other
|
26.0
|
%
|
|
25.5
|
%
|
|
0.5
|
%
|
|
2.0
|
%
|
|||
Total Gross Profit Margin
|
18.9
|
%
|
|
18.4
|
%
|
|
0.5
|
%
|
|
2.7
|
%
|
|||
Gross Profit Mix
|
|
|
|
|
|
|
|
|||||||
Equipment
|
26.0
|
%
|
|
23.0
|
%
|
|
3.0
|
%
|
|
13.0
|
%
|
|||
Parts
|
31.8
|
%
|
|
33.5
|
%
|
|
(1.7
|
)%
|
|
(5.1
|
)%
|
|||
Service
|
35.2
|
%
|
|
36.7
|
%
|
|
(1.5
|
)%
|
|
(4.1
|
)%
|
|||
Rental and other
|
7.0
|
%
|
|
6.8
|
%
|
|
0.2
|
%
|
|
2.9
|
%
|
|||
Total Gross Profit Mix
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
|
|
Nine Months Ended October 31,
|
|
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Operating Expenses
|
$
|
152,884
|
|
|
$
|
159,132
|
|
|
$
|
(6,248
|
)
|
|
(3.9
|
)%
|
Operating Expenses as a Percentage of Revenue
|
17.7
|
%
|
|
17.7
|
%
|
|
—
|
%
|
|
—
|
%
|
|
Nine Months Ended October 31,
|
|
|
|
Percent
|
||||||||
|
2017
|
|
2016
|
|
Increase
|
|
Change
|
||||||
|
(dollars in thousands)
|
|
|
||||||||||
Restructuring Costs
|
$
|
10,480
|
|
|
$
|
546
|
|
|
$
|
9,934
|
|
|
n/m
|
|
Nine Months Ended October 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Interest income and other income
|
$
|
1,840
|
|
|
$
|
1,251
|
|
|
$
|
589
|
|
|
47.1
|
%
|
Floorplan interest expense
|
(6,719
|
)
|
|
(10,843
|
)
|
|
(4,124
|
)
|
|
(38.0
|
)%
|
|||
Other interest expense
|
(6,694
|
)
|
|
(5,930
|
)
|
|
764
|
|
|
12.9
|
%
|
|
Nine Months Ended October 31,
|
|
|
|
Percent
|
||||||||
|
2017
|
|
2016
|
|
Increase
|
|
Change
|
||||||
|
(dollars in thousands)
|
|
|
||||||||||
Provision for (Benefit from) Income Taxes
|
$
|
(3,000
|
)
|
|
$
|
(3,997
|
)
|
|
$
|
(997
|
)
|
|
n/m
|
|
Nine Months Ended October 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Revenue
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
488,716
|
|
|
$
|
538,060
|
|
|
$
|
(49,344
|
)
|
|
(9.2
|
)%
|
Construction
|
214,252
|
|
|
241,922
|
|
|
(27,670
|
)
|
|
(11.4
|
)%
|
|||
International
|
160,362
|
|
|
115,477
|
|
|
44,885
|
|
|
38.9
|
%
|
|||
Total
|
$
|
863,330
|
|
|
$
|
895,459
|
|
|
$
|
(32,129
|
)
|
|
(3.6
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Income (Loss) Before Income Taxes
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
(5,870
|
)
|
|
$
|
(9,881
|
)
|
|
$
|
4,011
|
|
|
40.6
|
%
|
Construction
|
(4,076
|
)
|
|
(1,523
|
)
|
|
(2,553
|
)
|
|
(167.6
|
)%
|
|||
International
|
3,331
|
|
|
(88
|
)
|
|
3,419
|
|
|
*N/M
|
|
|||
Segment income (loss) before income taxes
|
(6,615
|
)
|
|
(11,492
|
)
|
|
4,877
|
|
|
42.4
|
%
|
|||
Shared Resources
|
(5,119
|
)
|
|
1,199
|
|
|
(6,318
|
)
|
|
(526.9
|
)%
|
|||
Total
|
$
|
(11,734
|
)
|
|
$
|
(10,293
|
)
|
|
$
|
(1,441
|
)
|
|
(14.0
|
)%
|
|
Three Months Ended October 31,
|
|
Nine Months Ended October 31,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(dollars in thousands, except per share data)
|
||||||||||||||
Net Income (Loss) Including Noncontrolling Interest
|
|
|
|
|
|
|
|
||||||||
Net Income (Loss) Including Noncontrolling Interest
|
$
|
2,384
|
|
|
$
|
264
|
|
|
$
|
(8,734
|
)
|
|
$
|
(6,296
|
)
|
Adjustments
|
|
|
|
|
|
|
|
||||||||
Impairment
|
131
|
|
|
275
|
|
|
131
|
|
|
275
|
|
||||
(Gain) Loss on Repurchase of Senior Convertible Notes
|
18
|
|
|
(1,028
|
)
|
|
(22
|
)
|
|
(3,130
|
)
|
||||
Debt Issuance Cost Write-Off
|
—
|
|
|
624
|
|
|
416
|
|
|
624
|
|
||||
Restructuring Costs
|
2,456
|
|
|
—
|
|
|
10,349
|
|
|
271
|
|
||||
Ukraine Remeasurement (1)
|
—
|
|
|
—
|
|
|
—
|
|
|
195
|
|
||||
Interest Rate Swap Termination & Reclassification
|
—
|
|
|
—
|
|
|
631
|
|
|
—
|
|
||||
Gain on Insurance Recoveries
|
—
|
|
|
(586
|
)
|
|
—
|
|
|
(586
|
)
|
||||
Total Pre-Tax Adjustments
|
2,605
|
|
|
(715
|
)
|
|
11,505
|
|
|
(2,351
|
)
|
||||
Less: Tax Effect of Adjustments (2)
|
895
|
|
|
(285
|
)
|
|
4,010
|
|
|
(1,018
|
)
|
||||
Plus: Income Tax Valuation Allowance
|
325
|
|
|
—
|
|
|
525
|
|
|
—
|
|
||||
Total Adjustments
|
2,035
|
|
|
(430
|
)
|
|
8,020
|
|
|
(1,333
|
)
|
||||
Adjusted Net Income (Loss) Including Noncontrolling Interest
|
$
|
4,419
|
|
|
$
|
(166
|
)
|
|
$
|
(714
|
)
|
|
$
|
(7,629
|
)
|
|
|
|
|
|
|
|
|
||||||||
Earnings (Loss) per Share - Diluted
|
|
|
|
|
|
|
|
||||||||
Earnings (Loss) per Share - Diluted
|
$
|
0.11
|
|
|
$
|
0.01
|
|
|
$
|
(0.40
|
)
|
|
$
|
(0.27
|
)
|
Adjustments (3)
|
|
|
|
|
|
|
|
||||||||
Impairment
|
0.01
|
|
|
0.01
|
|
|
0.01
|
|
|
0.01
|
|
||||
(Gain) Loss on Repurchase of Senior Convertible Notes
|
—
|
|
|
(0.04
|
)
|
|
—
|
|
|
(0.15
|
)
|
||||
Debt Issuance Cost Write-Off
|
—
|
|
|
0.03
|
|
|
0.02
|
|
|
0.02
|
|
||||
Restructuring Costs
|
0.11
|
|
|
—
|
|
|
0.48
|
|
|
0.01
|
|
||||
Ukraine Remeasurement (1)
|
—
|
|
|
—
|
|
|
—
|
|
|
0.01
|
|
||||
Interest Rate Swap Termination & Reclassification
|
—
|
|
|
—
|
|
|
0.03
|
|
|
—
|
|
||||
Gain on Insurance Recoveries
|
—
|
|
|
(0.03
|
)
|
|
—
|
|
|
(0.03
|
)
|
||||
Total Pre-Tax Adjustments
|
0.12
|
|
|
(0.03
|
)
|
|
0.54
|
|
|
(0.13
|
)
|
||||
Less: Tax Effect of Adjustments (2)
|
0.04
|
|
|
(0.01
|
)
|
|
0.19
|
|
|
(0.04
|
)
|
||||
Plus: Income Tax Valuation Allowance
|
0.01
|
|
|
—
|
|
|
0.02
|
|
|
—
|
|
||||
Total Non-GAAP Adjustments
|
0.09
|
|
|
(0.02
|
)
|
|
0.37
|
|
|
(0.09
|
)
|
||||
Adjusted Earnings (Loss) per Share - Diluted
|
$
|
0.20
|
|
|
$
|
(0.01
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.36
|
)
|
|
Net Cash Provided by (Used for) Operating Activities
|
|
Net Cash Used for Financing Activities
|
||||||||||||
|
Nine Months Ended October 31, 2017
|
|
Nine Months Ended October 31, 2016
|
|
Nine Months Ended October 31, 2017
|
|
Nine Months Ended October 31, 2016
|
||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||
Cash Flow, As Reported
|
$
|
56,031
|
|
|
$
|
74,398
|
|
|
$
|
(46,939
|
)
|
|
$
|
(104,638
|
)
|
Adjustment for Non-Manufacturer Floorplan Net Payments
|
(14,357
|
)
|
|
(54,478
|
)
|
|
14,357
|
|
|
54,478
|
|
||||
Adjustment for Constant Equity in Equipment Inventory
|
(52,506
|
)
|
|
14,503
|
|
|
—
|
|
|
—
|
|
||||
Adjusted Cash Flow
|
$
|
(10,832
|
)
|
|
$
|
34,423
|
|
|
$
|
(32,582
|
)
|
|
$
|
(50,160
|
)
|
No.
|
|
Description
|
|
|
|
|
|
|
|
Amendment No. 7 to the Amended and Restated Wholesale Financing Plan, dated as of October 5, 2017, by and between the registrant and DLL Finance LLC (f/k/a Agricredit Acceptance LLC)
|
|
|
|
|
|
Amendment dated October 5, 2017 to the Amended and Restated Wholesale Floor Plan Credit Facility and Security Agreement dated November 13, 2007, by and between the registrant and CNH Industrial Capital America LLC
|
|
|
|
|
|
Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
101
|
|
Financial statements from the Quarterly Report on Form 10-Q of the Company for the quarter ended October 31, 2017, 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.
|
|
Dated:
|
December 7, 2017
|
|
|
|
|
TITAN MACHINERY INC.
|
|
|
|
|
|
|
|
|
|
|
|
By
|
/s/ Mark Kalvoda
|
|
|
|
Mark Kalvoda
|
|
|
|
Chief Financial Officer
|
|
|
|
(Principal Financial Officer)
|
1.
|
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.
|
2.
|
Amendment
. Section 10 of the Agreement titled “Annual Renewal Fee” is hereby deleted in its entirety.
|
3.
|
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.
|
IN WITNESS WHEREOF, the Parties have executed this Amendment effective as of the date set forth above.
|
|||||
DEBTOR
SIGNATURE
|
Titan Machinery, Inc.
|
SECURED PARTY
SIGNATURE
|
DLL Finance LLC
At: 8001 Birchwood Court, Johnston, IA 50131
|
||
Debtor
|
|||||
/s/ Mark Kalvoda
|
/s/ Todd R Cate
|
||||
Authorized Signature
|
Authorized Signature
|
||||
Mark Kalvoda, Chief Financial Officer
|
10/5/2017
|
Todd R Cate, VP of Operations 10/10/17
|
|||
Print Name & Title
|
Date
|
Print Name & Title
|
Date
|
1.
|
All references to
“Guarantor”
and
“Guaranty”
shall be deleted from the WFSA.
|
2.
|
The defined term
“Change of Control”
shall be deleted in its entirely from the WFSA and replaced with the following:
|
(a)
|
a merger, consolidation or reorganization, unless securities representing more than fifty percent (50%) of the total combined voting power of the outstanding voting securities of the successor corporation are immediately thereafter beneficially owned, directly or indirectly, by the persons who beneficially owned Borrower’s outstanding voting securities immediately prior to such transaction;
|
(b)
|
any sale of all or substantially all of Borrower’s assets;
|
(c)
|
any transaction or series of related transactions (other than from the sale of shares issued or sold in any registered offering of Borrower’s securities) pursuant to which any person or any group of persons comprising a “group” within the meaning of Rule 13d-5(b)(1) under the Securities Exchange Act of 1934, as amended (other than Borrower or a person that, prior to such transaction or series of related transactions, directly or indirectly controls, is controlled by or is under common control with, Borrower) becomes directly or indirectly the beneficial owner (within the meaning of Rule 13d-3 of the Securities Exchange Act of 1934, as amended) of securities possessing (or convertible into or exercisable for securities possessing): i) twenty (20%) percent or more of the total combined voting power of Borrower’s securities (determined by the power to vote with respect to the elections of Board members) outstanding immediately after the consummation of such transaction or series of related transactions, if such group is a competitor of the Lender, a competitor of any affiliate of the Lender, or a dealer in goods produced by any competitor of any affiliate of the Lender; or ii) thirty (30%) percent or more of the total combined voting power of Borrower’s securities (determined by the power to vote with respect to the elections of Board members) outstanding immediately after the consummation of such transaction or series of related transactions; or
|
(d)
|
a change in the composition of the Board of Borrower over a period of eighteen (18) consecutive months or less such that a majority of the Board members ceases, by reason of one or more contested elections for Board membership, to be comprised of individuals who either (x) were Board members at the beginning of such period or (y) have been elected or nominated for election as Board members during such period by at least a majority of the Board members described in clause (x) who were still in office at the time the Board approved such election or nomination.
|
3.
|
A new definition of
“Consolidated Fixed Charge Coverage Ratio”
is hereby inserted into Section 1.01 of the WFSA.
|
4.
|
A new definition of
“Consolidated EBITDAR”
is hereby inserted into Section 1.01 of the WFSA.
|
5.
|
The WFSA is hereby revised and amended by deleting the existing subsection 5.01(a) in its entirety and the following new subsection 5.01(a), effective as of October 31, 2017, is substituted therefor:
|
(a)
|
Borrower shall maintain, as at the end of each Fiscal Period, a Consolidated Fixed Charge Coverage Ratio not less than 1.10:1.00.
|
6.
|
Section 5.13 shall be deleted in its entirety from the WFSA and replaced with the following:
|
7.
|
Section 5.14(b) shall be deleted in its entirety from the WFSA.
|
1.
|
Borrower has the full power and authority under its organizational documents to execute and deliver this Amendment and to continue to perform the obligations under the WFSA as amended hereby.
|
2.
|
The parties hereto acknowledge and agree that this Amendment constitutes a legal, valid and binding agreement of Lender and Borrower enforceable in accordance with its terms. This Amendment is the final expression of the Amendment to the Amended and Restated Wholesale Floor Plan Credit Facility and Security Agreement by and between Borrower and Lender and may not be contradicted by evidence of any prior or contemporaneous oral agreement between the parties hereto.
|
3.
|
This Amendment may be executed simultaneously in one or more counterparts, each of which shall be deemed an original, but all of which shall together constitute one and the same instrument.
|
4.
|
Except as amended or affected hereby, all of the terms and conditions of the WFSA are hereby affirmed, confirmed and ratified.
|
5.
|
This Amendment shall be construed and enforced as a contract in accordance with the laws of the State of Wisconsin without regard to internal principles relating to conflict of laws. This Agreement shall bind and inure to the benefit of Lender and Borrower and each of their respective successors, assigns and legal representatives.
|
CNH INDUSTRIAL CAPITAL AMERICA LLC
|
TITAN MACHINERY INC.
|
By: ___/s/ Thomas A. Mariani_____________
|
By: ____/s/ Mark Kalvoda___________________
|
Name: ____Thomas A. Mariani__________
|
Name: ___Mark Kalvoda__________________
|
Title: ___Chief Credit Officer____________
|
Title: _____Chief Financial Officer____________
|
|
|
1.
|
I have reviewed this Quarterly 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
|