|
Delaware
(State or Other Jurisdiction of
Incorporation or Organization)
|
No. 45-0357838
(IRS Employer
Identification No.)
|
Large accelerated filer
o
|
|
|
|
Accelerated filer
x
|
Non-accelerated filer
o
|
|
(Do not check if a smaller reporting company)
|
|
Smaller reporting company
o
|
Emerging Growth Company
o
|
|
|
|
|
|
|
|
Page No.
|
|
|
|
|
|
|
|
|
|
|
|
|
•
|
new and used equipment sales;
|
•
|
parts sales;
|
•
|
equipment repair and maintenance services; and
|
•
|
equipment rental and other activities.
|
•
|
our ability to manage inventory through our centralized inventory management system, thus allowing inventory exchanges among the stores, which permits us to more effectively manage inventory levels at each store while providing significant breadth of parts and equipment to our customers;
|
•
|
our ability to use expanded sales channels, including used equipment listings hosted on our website, which enables us to offer our customers alternative purchasing options; and
|
•
|
our ability to sell inventory to customers in a large geographic area covering Arizona, Colorado, Iowa, Minnesota, Montana, Nebraska, New Mexico, North Dakota, South Dakota, Wisconsin and Wyoming, which enables us to capitalize on crop diversification and disparate weather in growing regions, as well as local trends in residential, infrastructure and commercial construction.
|
•
|
our ability to staff a large number of highly-trained service technicians across our network of stores, which makes it possible to schedule repair services on short notice without affecting our technician utilization rates;
|
•
|
our ability to staff and leverage product and application specialists across our network of stores, which makes it possible to offer valuable pre-sale and aftermarket services, including equipment training, best practices education and precision farming technology support; and
|
•
|
our ability to innovate and lead our industry through initiatives such as GPS guidance systems to support precision farming and farm data management products and services, which provide our customers with the latest advances in technology and operating practices.
|
•
|
employing significant marketing and advertising programs, including targeted direct mailings, internet based marketing, advertising with targeted local media outlets, participation in and sponsorship of trade shows and industry events, our Titan Trader monthly magazine, and by hosting open houses, service clinics, equipment demonstrations, product showcases and customer appreciation outings;
|
•
|
supporting and providing customers with training for evolving technologies, such as precision farming and farm data management, that are difficult for small operators to support;
|
•
|
maintaining state-of-the-art service facilities, mobile service trucks and trained service technicians to maximize our customers' equipment uptime through preventative maintenance programs and seasonal 24/7 service support; and
|
•
|
utilizing our inventory system to optimize the availability of parts and equipment for our customers.
|
•
|
our sales employees, who operate out of our network of local stores and call on customers in the markets surrounding each store;
|
•
|
our area product support managers, and our store parts managers and service managers, who provide our customers with comprehensive after-market support;
|
•
|
our website;
|
•
|
local and regional advertising efforts, including broadcast, cable, print and web-based media; and
|
•
|
alternative channels, such as auctions, for selling our aged equipment inventories.
|
•
|
Floorplan payable financing for the purchase of a substantial portion of our equipment inventory;
|
•
|
A significant percentage of the financing used by our customers to purchase CNH Industrial equipment from us;
|
•
|
Reimbursement for warranty work performed by us pursuant to CNH’s product warranties;
|
•
|
Incentive programs and discount programs from time to time that enable us to price our products more competitively; and
|
•
|
Promotional and marketing activities on national, regional and local levels.
|
•
|
difficulties in implementing our business model in foreign markets;
|
•
|
costs and diversion of domestic management attention related to oversight of international operations;
|
•
|
unexpected adverse changes in export duties, quotas and tariffs and difficulties in obtaining import licenses;
|
•
|
cyclicality of demand for agricultural equipment, based on availability of European Union government subsidy programs and tax incentives;
|
•
|
unexpected adverse changes in foreign laws or regulatory requirements;
|
•
|
compliance with a variety of tax regulations, foreign laws and regulations;
|
•
|
compliance with the Foreign Corrupt Practices Act and other U.S. laws that apply to the international operations of U.S. companies which may be difficult and costly to implement and monitor, can create competitive disadvantages if our competitors are not subject to such laws, and which, if violated, may result in substantial financial and reputational harm;
|
•
|
fluctuations in foreign currency exchange rates to which we are exposed may adversely affect the results of our operations, the value of our foreign assets and liabilities and our cash flows;
|
•
|
the laws of the European countries in which we operate, unlike the U.S., do not include specific dealer protection laws and, therefore, we may be more susceptible to actions of suppliers that are adverse to our interests such as termination of our dealer agreements for any reason or installing additional dealers in our designated territories; and
|
•
|
political or economic changes or instability.
|
•
|
increase our vulnerability to general adverse economic and industry conditions;
|
•
|
limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; and
|
•
|
limit our ability to obtain additional financing for working capital, capital expenditures, acquisitions or general corporate purposes.
|
•
|
incur more debt;
|
•
|
make investments;
|
•
|
create liens;
|
•
|
merge or consolidate;
|
•
|
transfer and sell assets;
|
•
|
pay dividends or repurchase stock; and
|
•
|
issue equity instruments.
|
•
|
market prices for like equipment;
|
•
|
hours and condition of the equipment;
|
•
|
time of year that the equipment is sold;
|
•
|
the supply of used equipment on the market; and
|
•
|
general economic conditions.
|
|
Agriculture Segment
|
|
Construction Segment
|
|
International Segment
|
|
Total
|
||||
US States
|
|
|
|
|
|
|
|
||||
North Dakota
|
9
|
|
|
5
|
|
|
—
|
|
|
14
|
|
Minnesota
|
10
|
|
|
3
|
|
|
—
|
|
|
13
|
|
Iowa
|
10
|
|
|
3
|
|
|
—
|
|
|
13
|
|
Nebraska
|
11
|
|
|
2
|
|
|
—
|
|
|
13
|
|
South Dakota
|
8
|
|
|
2
|
|
|
—
|
|
|
10
|
|
Colorado
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
Montana
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
Arizona
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
New Mexico
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
Wisconsin
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
Wyoming
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
European Countries
|
|
|
|
|
|
|
|
||||
Bulgaria
|
—
|
|
|
—
|
|
|
7
|
|
|
7
|
|
Romania
|
—
|
|
|
—
|
|
|
9
|
|
|
9
|
|
Ukraine
|
—
|
|
|
—
|
|
|
6
|
|
|
6
|
|
Serbia
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
Total
|
48
|
|
|
26
|
|
|
23
|
|
|
97
|
|
Name
|
|
Age
|
|
Position
|
David Meyer
|
|
64
|
|
Board Chair and Chief Executive Officer
|
Mark Kalvoda
|
|
46
|
|
Chief Financial Officer
|
Bryan Knutson
|
|
39
|
|
Chief Operating Officer
|
|
High
|
|
Low
|
||||
Fiscal 2018
|
|
|
|
||||
First Quarter
|
$
|
16.38
|
|
|
$
|
13.24
|
|
Second Quarter
|
18.63
|
|
|
14.52
|
|
||
Third Quarter
|
17.93
|
|
|
11.95
|
|
||
Fourth Quarter
|
23.75
|
|
|
13.94
|
|
||
Fiscal 2017
|
|
|
|
||||
First Quarter
|
$
|
13.00
|
|
|
$
|
8.16
|
|
Second Quarter
|
12.74
|
|
|
10.54
|
|
||
Third Quarter
|
11.46
|
|
|
9.29
|
|
||
Fourth Quarter
|
15.70
|
|
|
8.69
|
|
|
January 31,
|
||||||||||||||||||||||
|
2013
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
||||||||||||
Titan Machinery Inc.
|
$
|
100.00
|
|
|
$
|
56.38
|
|
|
$
|
48.88
|
|
|
$
|
29.37
|
|
|
$
|
47.77
|
|
|
$
|
74.33
|
|
Russell 2000 Index
|
100.00
|
|
|
125.36
|
|
|
129.19
|
|
|
114.78
|
|
|
150.96
|
|
|
174.59
|
|
||||||
S&P 500 Retail Index
|
100.00
|
|
|
124.28
|
|
|
147.58
|
|
|
170.54
|
|
|
199.24
|
|
|
286.58
|
|
|
Year Ended January 31,
|
|||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|||||
Store Count Data
|
|
|
|
|
|
|
|
|
|
|||||
Net change in store count during fiscal year
|
(11
|
)
|
|
1
|
|
|
(4
|
)
|
|
(7
|
)
|
|
2
|
|
Store count at end of fiscal year
|
98
|
|
|
109
|
|
|
108
|
|
|
112
|
|
|
119
|
|
|
Year Ended January 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
(in thousands, except per share data)
|
||||||||||||||||||
Statement of Operations Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
|
|
|
|
|
|
|
|
|
||||||||||
Equipment
|
$
|
804,361
|
|
|
$
|
797,315
|
|
|
$
|
925,471
|
|
|
$
|
1,398,195
|
|
|
$
|
1,722,738
|
|
Parts
|
222,404
|
|
|
233,819
|
|
|
245,387
|
|
|
270,262
|
|
|
275,750
|
|
|||||
Service
|
117,318
|
|
|
124,076
|
|
|
127,457
|
|
|
147,356
|
|
|
149,082
|
|
|||||
Rental and other
|
58,855
|
|
|
57,870
|
|
|
69,520
|
|
|
84,433
|
|
|
78,876
|
|
|||||
Total Revenue
|
1,202,938
|
|
|
1,213,080
|
|
|
1,367,835
|
|
|
1,900,246
|
|
|
2,226,446
|
|
|||||
Cost of Revenue
|
|
|
|
|
|
|
|
|
|
||||||||||
Equipment
|
743,465
|
|
|
746,169
|
|
|
889,567
|
|
|
1,286,148
|
|
|
1,576,246
|
|
|||||
Parts
|
156,455
|
|
|
164,020
|
|
|
173,083
|
|
|
189,540
|
|
|
192,199
|
|
|||||
Service
|
44,141
|
|
|
46,284
|
|
|
46,814
|
|
|
53,924
|
|
|
54,608
|
|
|||||
Rental and other
|
43,577
|
|
|
42,878
|
|
|
52,457
|
|
|
62,250
|
|
|
55,319
|
|
|||||
Total Cost of Revenue
|
987,638
|
|
|
999,351
|
|
|
1,161,921
|
|
|
1,591,862
|
|
|
1,878,372
|
|
|||||
Gross Profit
|
215,300
|
|
|
213,729
|
|
|
205,914
|
|
|
308,384
|
|
|
348,074
|
|
|||||
Operating Expenses
|
203,203
|
|
|
211,372
|
|
|
220,524
|
|
|
273,271
|
|
|
291,202
|
|
|||||
Impairment and Restructuring Costs
|
11,172
|
|
|
4,729
|
|
|
8,500
|
|
|
34,390
|
|
|
9,997
|
|
|||||
Income (Loss) from Operations
|
925
|
|
|
(2,372
|
)
|
|
(23,110
|
)
|
|
723
|
|
|
46,875
|
|
|||||
Other Income (Expense)
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest income and other income (expense)
|
1,635
|
|
|
1,524
|
|
|
(478
|
)
|
|
(4,272
|
)
|
|
2,109
|
|
|||||
Interest expense
|
(16,999
|
)
|
|
(21,865
|
)
|
|
(32,623
|
)
|
|
(34,791
|
)
|
|
(30,555
|
)
|
|||||
Income (Loss) Before Income Taxes
|
(14,439
|
)
|
|
(22,713
|
)
|
|
(56,211
|
)
|
|
(38,340
|
)
|
|
18,429
|
|
|||||
Provision for (Benefit from) Income Taxes
|
(7,390
|
)
|
|
(8,178
|
)
|
|
(17,982
|
)
|
|
(4,923
|
)
|
|
10,325
|
|
|||||
Net Income (Loss) Including Noncontrolling Interest
|
(7,049
|
)
|
|
(14,535
|
)
|
|
(38,229
|
)
|
|
(33,417
|
)
|
|
8,104
|
|
|||||
Less: Income (Loss) Attributable to Noncontrolling Interest
|
—
|
|
|
(356
|
)
|
|
(337
|
)
|
|
(1,260
|
)
|
|
(747
|
)
|
|||||
Net Income (Loss) Attributable to Titan Machinery Inc.
|
(7,049
|
)
|
|
(14,179
|
)
|
|
(37,892
|
)
|
|
(32,157
|
)
|
|
8,851
|
|
|||||
Net (Income) Loss Allocated to Participating Securities
|
141
|
|
|
243
|
|
|
717
|
|
|
559
|
|
|
(129
|
)
|
|||||
Net Income (Loss) Attributable to Titan Machinery Inc. Common Stockholders
|
$
|
(6,908
|
)
|
|
$
|
(13,936
|
)
|
|
$
|
(37,175
|
)
|
|
$
|
(31,598
|
)
|
|
$
|
8,722
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings (Loss) per Share
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
(0.32
|
)
|
|
$
|
(0.65
|
)
|
|
$
|
(1.76
|
)
|
|
$
|
(1.51
|
)
|
|
$
|
0.42
|
|
Diluted
|
$
|
(0.32
|
)
|
|
$
|
(0.65
|
)
|
|
$
|
(1.76
|
)
|
|
$
|
(1.51
|
)
|
|
$
|
0.41
|
|
Weighted average shares outstanding
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
21,543
|
|
|
21,294
|
|
|
21,111
|
|
|
20,989
|
|
|
20,894
|
|
|||||
Diluted
|
21,543
|
|
|
21,294
|
|
|
21,111
|
|
|
20,989
|
|
|
21,040
|
|
|
January 31,
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash
|
$
|
53,396
|
|
|
$
|
53,151
|
|
|
$
|
89,465
|
|
|
$
|
127,528
|
|
|
$
|
74,242
|
|
Receivables, net
|
60,672
|
|
|
60,082
|
|
|
65,534
|
|
|
84,921
|
|
|
105,710
|
|
|||||
Inventories
|
472,467
|
|
|
478,266
|
|
|
680,482
|
|
|
870,901
|
|
|
1,068,162
|
|
|||||
Prepaid expenses and other
|
12,440
|
|
|
10,989
|
|
|
9,753
|
|
|
10,634
|
|
|
24,740
|
|
|||||
Income taxes receivable
|
171
|
|
|
5,380
|
|
|
13,011
|
|
|
166
|
|
|
851
|
|
|||||
Assets held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
15,312
|
|
|
—
|
|
|||||
Total current assets
|
599,146
|
|
|
607,868
|
|
|
858,245
|
|
|
1,109,462
|
|
|
1,273,705
|
|
|||||
Goodwill and intangibles, net
|
5,193
|
|
|
5,001
|
|
|
5,134
|
|
|
5,458
|
|
|
36,501
|
|
|||||
Property and Equipment, net of accumulated depreciation
|
151,047
|
|
|
156,647
|
|
|
183,179
|
|
|
208,680
|
|
|
228,000
|
|
|||||
Deferred income taxes
|
3,472
|
|
|
547
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other assets
|
1,450
|
|
|
1,359
|
|
|
1,317
|
|
|
2,014
|
|
|
6,967
|
|
|||||
Total Assets
|
$
|
760,308
|
|
|
$
|
771,422
|
|
|
$
|
1,047,875
|
|
|
$
|
1,325,614
|
|
|
$
|
1,545,173
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
$
|
15,136
|
|
|
$
|
17,326
|
|
|
$
|
16,863
|
|
|
$
|
17,659
|
|
|
$
|
23,714
|
|
Floorplan payable (1)
|
247,392
|
|
|
233,228
|
|
|
444,780
|
|
|
625,162
|
|
|
748,326
|
|
|||||
Current maturities of long-term debt
|
1,574
|
|
|
1,373
|
|
|
1,557
|
|
|
7,749
|
|
|
2,192
|
|
|||||
Customer deposits
|
32,324
|
|
|
26,366
|
|
|
31,159
|
|
|
35,090
|
|
|
61,286
|
|
|||||
Accrued expenses and other
|
31,863
|
|
|
30,533
|
|
|
29,066
|
|
|
35,496
|
|
|
36,968
|
|
|||||
Liabilities held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
2,835
|
|
|
—
|
|
|||||
Income taxes payable
|
—
|
|
|
—
|
|
|
—
|
|
|
3,529
|
|
|
344
|
|
|||||
Total current liabilities
|
328,289
|
|
|
308,826
|
|
|
523,425
|
|
|
727,520
|
|
|
872,830
|
|
|||||
Senior convertible notes
|
62,819
|
|
|
88,501
|
|
|
134,145
|
|
|
129,889
|
|
|
125,895
|
|
|||||
Long-term debt, less current maturities
|
34,578
|
|
|
38,236
|
|
|
38,409
|
|
|
66,563
|
|
|
94,940
|
|
|||||
Deferred income taxes
|
2,275
|
|
|
9,500
|
|
|
11,135
|
|
|
19,971
|
|
|
33,651
|
|
|||||
Other long-term liabilities
|
10,492
|
|
|
5,180
|
|
|
2,412
|
|
|
3,312
|
|
|
6,515
|
|
|||||
Total stockholders' equity
|
321,855
|
|
|
321,179
|
|
|
338,349
|
|
|
378,359
|
|
|
411,342
|
|
|||||
Total Liabilities and Stockholders' Equity
|
$
|
760,308
|
|
|
$
|
771,422
|
|
|
$
|
1,047,875
|
|
|
$
|
1,325,614
|
|
|
$
|
1,545,173
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(1) Portion of floorplan payable balance which is interest-bearing as of January 31
|
47
|
%
|
|
72
|
%
|
|
75
|
%
|
|
75
|
%
|
|
56
|
%
|
•
|
new and used equipment sales;
|
•
|
parts sales;
|
•
|
equipment repair and maintenance services; and
|
•
|
equipment rental and other activities.
|
•
|
CNH Industrial’s product offerings, reputation and market share;
|
•
|
CNH Industrial’s product prices and incentive and discount programs;
|
•
|
CNH Industrial's supply of inventory;
|
•
|
CNH Industrial's offering of floorplan payable financing for the purchase of a substantial portion of our inventory; and
|
•
|
CNH Industrial's offering of financing and leasing used by our customers to purchase CNH Industrial equipment from us.
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
(in thousands)
|
||||||||||
Net Loss Including Noncontrolling Interest
|
$
|
(7,049
|
)
|
|
$
|
(14,535
|
)
|
|
$
|
(38,229
|
)
|
Adjustments
|
|
|
|
|
|
||||||
Interest Expense, Net of Interest Income
|
7,935
|
|
|
7,112
|
|
|
12,091
|
|
|||
Benefit from Income Taxes
|
(7,390
|
)
|
|
(8,178
|
)
|
|
(17,982
|
)
|
|||
Depreciation and amortization
|
25,105
|
|
|
26,868
|
|
|
28,538
|
|
|||
EBITDA (Loss)
|
18,601
|
|
|
11,267
|
|
|
(15,582
|
)
|
|||
|
|
|
|
|
|
||||||
Adjustments
|
|
|
|
|
|
||||||
Impairment of Long-Lived Assets
|
673
|
|
|
4,410
|
|
|
6,903
|
|
|||
Gain on Repurchase of Senior Convertible Notes
|
(22
|
)
|
|
(3,130
|
)
|
|
—
|
|
|||
Debt Issuance Cost Write-Off
|
416
|
|
|
624
|
|
|
1,558
|
|
|||
Restructuring Costs
|
10,499
|
|
|
319
|
|
|
1,597
|
|
|||
Ukraine Remeasurement (1)
|
—
|
|
|
195
|
|
|
2,485
|
|
|||
Interest Rate Swap Termination & Reclassification
|
631
|
|
|
—
|
|
|
—
|
|
|||
Gain on Insurance Recoveries
|
—
|
|
|
(1,997
|
)
|
|
—
|
|
|||
Total Adjustments
|
12,197
|
|
|
421
|
|
|
12,543
|
|
|||
Adjusted EBITDA (Loss)
|
$
|
30,798
|
|
|
$
|
11,688
|
|
|
$
|
(3,039
|
)
|
•
|
Equipment
: We derive equipment revenue from the sale of new and used agricultural and construction equipment.
|
•
|
Parts:
We derive parts revenue from the sale of parts for brands of equipment that we sell, other makes of equipment, and other types of equipment and related components. Our parts sales provide us with a relatively stable revenue stream that is less sensitive to the economic cycles that affect our equipment sales.
|
•
|
Service:
We derive services revenue from repair and maintenance services to our customers' equipment. Our repair and maintenance services provide a high-margin, relatively stable source of revenue through changing economic cycles.
|
•
|
Rental and other:
We derive other revenue from equipment rentals and ancillary equipment support activities such as equipment transportation, GPS signal subscriptions and reselling finance and insurance products.
|
•
|
Equipment:
Cost of equipment revenue is the lower of the acquired cost or the market value of the specific piece of equipment sold.
|
•
|
Parts:
Cost of parts revenue is the lower of the acquired cost or the market value of the parts sold, based on average costing.
|
•
|
Service:
Cost of service revenue represents costs attributable to services provided for the maintenance and repair of customer-owned equipment and equipment then on-rent by customers.
|
•
|
Rental and other:
Costs of other revenue represent costs associated with equipment rental, such as depreciation, maintenance and repairs, as well as costs associated providing transportation, hauling, parts freight, GPS subscriptions and damage waivers, including, among other items, drivers' wages, fuel costs, shipping costs and our costs related to damage waiver policies.
|
|
Year Ended January 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(dollars in thousands)
|
||||||||||
Equipment
|
|
|
|
|
|
||||||
Revenue
|
$
|
804,361
|
|
|
$
|
797,315
|
|
|
$
|
925,471
|
|
Cost of revenue
|
743,465
|
|
|
746,169
|
|
|
889,567
|
|
|||
Gross profit
|
$
|
60,896
|
|
|
$
|
51,146
|
|
|
$
|
35,904
|
|
Gross profit margin
|
7.6
|
%
|
|
6.4
|
%
|
|
3.9
|
%
|
|||
Parts
|
|
|
|
|
|
||||||
Revenue
|
$
|
222,404
|
|
|
$
|
233,819
|
|
|
$
|
245,387
|
|
Cost of revenue
|
156,455
|
|
|
164,020
|
|
|
173,083
|
|
|||
Gross profit
|
$
|
65,949
|
|
|
$
|
69,799
|
|
|
$
|
72,304
|
|
Gross profit margin
|
29.7
|
%
|
|
29.9
|
%
|
|
29.5
|
%
|
|||
Service
|
|
|
|
|
|
||||||
Revenue
|
$
|
117,318
|
|
|
$
|
124,076
|
|
|
$
|
127,457
|
|
Cost of revenue
|
44,141
|
|
|
46,284
|
|
|
46,814
|
|
|||
Gross profit
|
$
|
73,177
|
|
|
$
|
77,792
|
|
|
$
|
80,643
|
|
Gross profit margin
|
62.4
|
%
|
|
62.7
|
%
|
|
63.3
|
%
|
|||
Rental and other
|
|
|
|
|
|
||||||
Revenue
|
$
|
58,855
|
|
|
$
|
57,870
|
|
|
$
|
69,520
|
|
Cost of revenue
|
43,577
|
|
|
42,878
|
|
|
52,457
|
|
|||
Gross profit
|
$
|
15,278
|
|
|
$
|
14,992
|
|
|
$
|
17,063
|
|
Gross profit margin
|
26.0
|
%
|
|
25.9
|
%
|
|
24.5
|
%
|
|
Year Ended January 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2018
|
|
2017
|
|
Decrease
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Equipment
|
$
|
804,361
|
|
|
$
|
797,315
|
|
|
$
|
7,046
|
|
|
0.9
|
%
|
Parts
|
222,404
|
|
|
233,819
|
|
|
(11,415
|
)
|
|
(4.9
|
)%
|
|||
Service
|
117,318
|
|
|
124,076
|
|
|
(6,758
|
)
|
|
(5.4
|
)%
|
|||
Rental and other
|
58,855
|
|
|
57,870
|
|
|
985
|
|
|
1.7
|
%
|
|||
Total Revenue
|
$
|
1,202,938
|
|
|
$
|
1,213,080
|
|
|
$
|
(10,142
|
)
|
|
(0.8
|
)%
|
|
Year Ended January 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2018
|
|
2017
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Gross Profit
|
|
|
|
|
|
|
|
|||||||
Equipment
|
$
|
60,896
|
|
|
$
|
51,146
|
|
|
$
|
9,750
|
|
|
19.1
|
%
|
Parts
|
65,949
|
|
|
69,799
|
|
|
(3,850
|
)
|
|
(5.5
|
)%
|
|||
Service
|
73,177
|
|
|
77,792
|
|
|
(4,615
|
)
|
|
(5.9
|
)%
|
|||
Rental and other
|
15,278
|
|
|
14,992
|
|
|
286
|
|
|
1.9
|
%
|
|||
Total Gross Profit
|
$
|
215,300
|
|
|
$
|
213,729
|
|
|
$
|
1,571
|
|
|
0.7
|
%
|
Gross Profit Margin
|
|
|
|
|
|
|
|
|||||||
Equipment
|
7.6
|
%
|
|
6.4
|
%
|
|
1.2
|
%
|
|
18.8
|
%
|
|||
Parts
|
29.7
|
%
|
|
29.9
|
%
|
|
(0.2
|
)%
|
|
(0.7
|
)%
|
|||
Service
|
62.4
|
%
|
|
62.7
|
%
|
|
(0.3
|
)%
|
|
(0.5
|
)%
|
|||
Rental and other
|
26.0
|
%
|
|
25.9
|
%
|
|
0.1
|
%
|
|
0.4
|
%
|
|||
Total Gross Profit Margin
|
17.9
|
%
|
|
17.6
|
%
|
|
0.3
|
%
|
|
1.7
|
%
|
|||
Gross Profit Mix
|
|
|
|
|
|
|
|
|||||||
Equipment
|
28.3
|
%
|
|
23.9
|
%
|
|
4.4
|
%
|
|
18.4
|
%
|
|||
Parts
|
30.6
|
%
|
|
32.7
|
%
|
|
(2.1
|
)%
|
|
(6.4
|
)%
|
|||
Service
|
34.0
|
%
|
|
36.4
|
%
|
|
(2.4
|
)%
|
|
(6.6
|
)%
|
|||
Rental and other
|
7.1
|
%
|
|
7.0
|
%
|
|
0.1
|
%
|
|
1.4
|
%
|
|||
Total Gross Profit Mix
|
100.0
|
%
|
|
100.0
|
%
|
|
—
|
%
|
|
—
|
%
|
|
Year Ended January 31,
|
|
|
|
Percent
|
|||||||||
|
2018
|
|
2017
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Operating Expenses
|
$
|
203,203
|
|
|
$
|
211,372
|
|
|
$
|
(8,169
|
)
|
|
(3.9
|
)%
|
Operating Expenses as a Percentage of Revenue
|
16.9
|
%
|
|
17.4
|
%
|
|
(0.5
|
)%
|
|
(2.9
|
)%
|
|
Year Ended January 31,
|
|
Increase/
|
|
Percent
|
||||||
|
2018
|
|
2017
|
|
Decrease
|
|
Change
|
||||
|
(dollars in thousands)
|
|
|
||||||||
Impairment of Long-Lived Assets
|
673
|
|
|
4,410
|
|
|
(3,737
|
)
|
|
(84.7
|
)%
|
Restructuring Costs
|
10,499
|
|
|
319
|
|
|
10,180
|
|
|
N/M
|
|
|
Year Ended January 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2018
|
|
2017
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Interest income and other income (expense)
|
$
|
1,635
|
|
|
$
|
1,524
|
|
|
$
|
111
|
|
|
7.3
|
%
|
Floorplan interest expense
|
(8,152
|
)
|
|
(13,560
|
)
|
|
(5,408
|
)
|
|
(39.9
|
)%
|
|||
Other interest expense
|
(8,847
|
)
|
|
(8,305
|
)
|
|
542
|
|
|
6.5
|
%
|
|
Year Ended January 31,
|
|
|
|
Percent
|
|||||||||
|
2018
|
|
2017
|
|
Decrease
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Benefit from Income Taxes
|
$
|
(7,390
|
)
|
|
$
|
(8,178
|
)
|
|
$
|
(788
|
)
|
|
(9.6
|
)%
|
|
Year Ended January 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2018
|
|
2017
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Revenue
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
694,025
|
|
|
$
|
739,167
|
|
|
$
|
(45,142
|
)
|
|
(6.1
|
)%
|
Construction
|
300,019
|
|
|
323,625
|
|
|
(23,606
|
)
|
|
(7.3
|
)%
|
|||
International
|
208,894
|
|
|
150,288
|
|
|
58,607
|
|
|
39.0
|
%
|
|||
Total
|
$
|
1,202,938
|
|
|
$
|
1,213,080
|
|
|
$
|
(10,141
|
)
|
|
(0.8
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Income (Loss) Before Income Taxes
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
(3,678
|
)
|
|
$
|
(15,781
|
)
|
|
$
|
12,103
|
|
|
76.7
|
%
|
Construction
|
(7,278
|
)
|
|
(5,875
|
)
|
|
(1,403
|
)
|
|
(23.9
|
)%
|
|||
International
|
2,205
|
|
|
(469
|
)
|
|
2,674
|
|
|
N/M
|
|
|||
Segment income (loss) before income taxes
|
(8,751
|
)
|
|
(22,125
|
)
|
|
13,374
|
|
|
60.4
|
%
|
|||
Shared Resources
|
(5,688
|
)
|
|
(588
|
)
|
|
(5,100
|
)
|
|
N/M
|
|
|||
Total
|
$
|
(14,439
|
)
|
|
$
|
(22,713
|
)
|
|
$
|
8,274
|
|
|
36.4
|
%
|
|
Year Ended January 31,
|
|
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
Decrease
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Equipment
|
$
|
797,315
|
|
|
$
|
925,471
|
|
|
$
|
(128,156
|
)
|
|
(13.8
|
)%
|
Parts
|
233,819
|
|
|
245,387
|
|
|
(11,568
|
)
|
|
(4.7
|
)%
|
|||
Service
|
124,076
|
|
|
127,457
|
|
|
(3,381
|
)
|
|
(2.7
|
)%
|
|||
Rental and other
|
57,870
|
|
|
69,520
|
|
|
(11,650
|
)
|
|
(16.8
|
)%
|
|||
Total Revenue
|
$
|
1,213,080
|
|
|
$
|
1,367,835
|
|
|
$
|
(154,755
|
)
|
|
(11.3
|
)%
|
|
Year Ended January 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Gross Profit
|
|
|
|
|
|
|
|
|||||||
Equipment
|
$
|
51,146
|
|
|
$
|
35,904
|
|
|
$
|
15,242
|
|
|
42.5
|
%
|
Parts
|
69,799
|
|
|
72,304
|
|
|
(2,505
|
)
|
|
(3.5
|
)%
|
|||
Service
|
77,792
|
|
|
80,643
|
|
|
(2,851
|
)
|
|
(3.5
|
)%
|
|||
Rental and other
|
14,992
|
|
|
17,063
|
|
|
(2,071
|
)
|
|
(12.1
|
)%
|
|||
Total Gross Profit
|
$
|
213,729
|
|
|
$
|
205,914
|
|
|
$
|
7,815
|
|
|
3.8
|
%
|
Gross Profit Margin
|
|
|
|
|
|
|
|
|||||||
Equipment
|
6.4
|
%
|
|
3.9
|
%
|
|
2.5
|
%
|
|
64.1
|
%
|
|||
Parts
|
29.9
|
%
|
|
29.5
|
%
|
|
0.4
|
%
|
|
1.4
|
%
|
|||
Service
|
62.7
|
%
|
|
63.3
|
%
|
|
(0.6
|
)%
|
|
(0.9
|
)%
|
|||
Rental and other
|
25.9
|
%
|
|
24.5
|
%
|
|
1.4
|
%
|
|
5.7
|
%
|
|||
Total Gross Profit Margin
|
17.6
|
%
|
|
15.1
|
%
|
|
2.5
|
%
|
|
16.6
|
%
|
|||
Gross Profit Mix
|
|
|
|
|
|
|
|
|||||||
Equipment
|
23.9
|
%
|
|
17.4
|
%
|
|
6.5
|
%
|
|
37.4
|
%
|
|||
Parts
|
32.7
|
%
|
|
35.1
|
%
|
|
(2.4
|
)%
|
|
(6.8
|
)%
|
|||
Service
|
36.4
|
%
|
|
39.2
|
%
|
|
(2.8
|
)%
|
|
(7.1
|
)%
|
|||
Rental and other
|
7.0
|
%
|
|
8.3
|
%
|
|
(1.3
|
)%
|
|
(15.7
|
)%
|
|||
Total Gross Profit Mix
|
100.0
|
%
|
|
100.0
|
%
|
|
—
|
%
|
|
—
|
%
|
|
Year Ended January 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Operating Expenses
|
$
|
211,372
|
|
|
$
|
220,524
|
|
|
$
|
(9,152
|
)
|
|
(4.2
|
)%
|
Operating Expenses as a Percentage of Revenue
|
17.4
|
%
|
|
16.2
|
%
|
|
1.2
|
%
|
|
7.4
|
%
|
|
Year Ended January 31,
|
|
|
|
Percent
|
||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
||||
|
(dollars in thousands)
|
|
|
||||||||
Impairment of Long-Lived Assets
|
4,410
|
|
|
6,903
|
|
|
(2,493
|
)
|
|
(36.1
|
)%
|
Restructuring Costs
|
319
|
|
|
1,597
|
|
|
(1,278
|
)
|
|
(80.0
|
)%
|
|
Year Ended January 31,
|
|
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
Decrease
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Interest income and other income (expense)
|
$
|
1,524
|
|
|
$
|
(478
|
)
|
|
$
|
(2,002
|
)
|
|
N/M
|
|
Floorplan interest expense
|
(13,560
|
)
|
|
(18,334
|
)
|
|
(4,774
|
)
|
|
(26.0
|
)%
|
|||
Other interest expense
|
(8,305
|
)
|
|
(14,289
|
)
|
|
(5,984
|
)
|
|
(41.9
|
)%
|
|
Year Ended January 31,
|
|
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Benefit from Income Taxes
|
$
|
(8,178
|
)
|
|
$
|
(17,982
|
)
|
|
$
|
(9,804
|
)
|
|
(54.5
|
)%
|
|
Year Ended January 31,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Revenue
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
739,167
|
|
|
$
|
864,851
|
|
|
$
|
(125,684
|
)
|
|
(14.5
|
)%
|
Construction
|
323,625
|
|
|
340,916
|
|
|
(17,291
|
)
|
|
(5.1
|
)%
|
|||
International
|
150,288
|
|
|
162,068
|
|
|
(11,780
|
)
|
|
(7.3
|
)%
|
|||
Total
|
$
|
1,213,080
|
|
|
$
|
1,367,835
|
|
|
$
|
(154,755
|
)
|
|
(11.3
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Income (Loss) Before Income Taxes
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
(15,781
|
)
|
|
$
|
(29,710
|
)
|
|
$
|
13,929
|
|
|
46.9
|
%
|
Construction
|
(5,875
|
)
|
|
(26,388
|
)
|
|
20,513
|
|
|
77.7
|
%
|
|||
International
|
(469
|
)
|
|
(3,004
|
)
|
|
2,535
|
|
|
84.4
|
%
|
|||
Segment income (loss) before income taxes
|
(22,125
|
)
|
|
(59,102
|
)
|
|
36,977
|
|
|
62.6
|
%
|
|||
Shared Resources
|
(588
|
)
|
|
2,891
|
|
|
(3,479
|
)
|
|
(120.3
|
)%
|
|||
Total
|
$
|
(22,713
|
)
|
|
$
|
(56,211
|
)
|
|
$
|
33,498
|
|
|
(59.6
|
)%
|
|
Year Ended January 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(dollars in thousands, except per share data)
|
||||||||||
Net Loss Including Noncontrolling Interest
|
|
|
|
|
|
||||||
Net Loss Including Noncontrolling Interest
|
$
|
(7,049
|
)
|
|
$
|
(14,535
|
)
|
|
$
|
(38,229
|
)
|
Adjustments
|
|
|
|
|
|
||||||
Impairment of Long-Lived Assets
|
673
|
|
|
4,410
|
|
|
6,903
|
|
|||
Gain on Repurchase of Senior Convertible Notes
|
(22
|
)
|
|
(3,130
|
)
|
|
—
|
|
|||
Debt Issuance Cost Write-Off
|
416
|
|
|
624
|
|
|
1,558
|
|
|||
Restructuring Costs
|
10,499
|
|
|
319
|
|
|
1,597
|
|
|||
Ukraine Remeasurement (1)
|
—
|
|
|
195
|
|
|
2,485
|
|
|||
Interest Rate Swap Termination & Reclassification
|
631
|
|
|
—
|
|
|
—
|
|
|||
Gain on Insurance Recoveries
|
—
|
|
|
(1,997
|
)
|
|
—
|
|
|||
Total Pre-Tax Adjustments
|
12,197
|
|
|
421
|
|
|
12,543
|
|
|||
Less: Tax Effect of Adjustments (2)
|
4,103
|
|
|
(6
|
)
|
|
1,639
|
|
|||
Less: Benefit from Tax Act
|
1,809
|
|
|
—
|
|
|
—
|
|
|||
Plus: Income Tax Valuation Allowance (3)
|
(1,920
|
)
|
|
44
|
|
|
2,384
|
|
|||
Total Adjustments
|
4,365
|
|
|
383
|
|
|
8,520
|
|
|||
Adjusted Net Loss Including Noncontrolling Interest
|
$
|
(2,684
|
)
|
|
$
|
(14,152
|
)
|
|
$
|
(29,709
|
)
|
|
|
|
|
|
|
||||||
Diluted EPS
|
|
|
|
|
|
||||||
Diluted EPS
|
$
|
(0.32
|
)
|
|
$
|
(0.65
|
)
|
|
$
|
(1.76
|
)
|
Adjustments (4)
|
|
|
|
|
|
||||||
Impairment of Long-Lived Assets
|
0.03
|
|
|
0.20
|
|
|
0.32
|
|
|||
Gain on Repurchase of Senior Convertible Notes
|
—
|
|
|
(0.15
|
)
|
|
—
|
|
|||
Debt Issuance Cost Write-Off
|
0.02
|
|
|
0.03
|
|
|
0.07
|
|
|||
Restructuring Costs
|
0.48
|
|
|
0.01
|
|
|
0.07
|
|
|||
Ukraine Remeasurement (1)
|
—
|
|
|
0.01
|
|
|
0.12
|
|
|||
Interest Rate Swap Termination & Reclassification
|
0.03
|
|
|
—
|
|
|
—
|
|
|||
Gain on Insurance Recoveries
|
—
|
|
|
(0.10
|
)
|
|
—
|
|
|||
Total Pre-Tax Adjustments
|
0.56
|
|
|
—
|
|
|
0.58
|
|
|||
Less: Tax Effect of Adjustments (2)
|
0.19
|
|
|
—
|
|
|
0.19
|
|
|||
Less: Benefit from Tax Act
|
0.08
|
|
|
—
|
|
|
—
|
|
|||
Plus: Income Tax Valuation Allowance (3)
|
(0.09
|
)
|
|
—
|
|
|
0.11
|
|
|||
Total Adjustments
|
0.20
|
|
|
—
|
|
|
0.51
|
|
|||
Adjusted Diluted EPS
|
$
|
(0.12
|
)
|
|
$
|
(0.65
|
)
|
|
$
|
(1.25
|
)
|
(1)
|
Beginning in the second quarter of fiscal 2017 we discontinued incorporating Ukraine remeasurement losses into our adjusted income (loss) and earnings (loss) per share calculations. The Ukrainian hryvnia (UAH) remained relatively stable subsequent to April 30, 2016 and therefore did not significantly impact our consolidated statement of operations during this period. Absent any future significant hryvnia volatility and resulting financial statement impact, we will not include Ukraine remeasurement losses in our adjusted amounts in future periods.
|
(2)
|
The tax effect of adjustments was calculated using a 33.8% tax rate for the year ended January 31, 2018 and a 35.0% tax rate for the years ended January 31, 2017 and 2016 for all U.S. related items, which was determined based on the federal statutory rate applicable to the respective fiscal year and no impact for state taxes given our valuation allowance against state deferred tax assets. No tax effect was recognized for foreign related items as all adjustments occurred in foreign jurisdictions that have full valuation allowances on deferred tax assets.
|
(3)
|
For all fiscal years, amounts reflect the initial valuation allowance recognized for all deferred tax assets for which no previous valuation allowance existed. In addition, for fiscal 2018, the amount includes the benefit recognized from the release of the valuation allowance on our Ukrainian deferred tax assets, net of the incremental valuation allowance recognized as a result of restructuring costs incurred in fiscal 2018.
|
(4)
|
Adjustments are net of the impact of amounts attributable to noncontrolling interests and allocated to participating securities.
|
|
Net Cash Provided by Operating Activities
|
|
Net Cash Used for Financing Activities
|
||||||||||||||||||||
|
Year Ended January 31,
|
|
Year Ended January 31,
|
||||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2018
|
|
2017
|
|
2016
|
||||||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||||||||||
Cash Flow, As Reported
|
$
|
95,821
|
|
|
$
|
140,997
|
|
|
$
|
231,884
|
|
|
$
|
(71,466
|
)
|
|
$
|
(167,976
|
)
|
|
$
|
(268,956
|
)
|
Adjustment for Non-Manufacturer Floorplan Net Payments
|
(38,626
|
)
|
|
(116,558
|
)
|
|
(221,912
|
)
|
|
38,626
|
|
|
116,558
|
|
|
221,912
|
|
||||||
Adjustment for Constant Equity in Equipment Inventory
|
(11,603
|
)
|
|
64,400
|
|
|
34,330
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Adjusted Cash Flow
|
$
|
45,592
|
|
|
$
|
88,839
|
|
|
$
|
44,302
|
|
|
$
|
(32,840
|
)
|
|
$
|
(51,418
|
)
|
|
$
|
(47,044
|
)
|
|
|
|
|
Payments Due By Period
|
||||||||||||||||
Contractual Obligations
|
|
Total
|
|
Less Than
1 Year
|
|
1 to 3 Years
|
|
3 to 5 Years
|
|
More Than
5 Years
|
||||||||||
|
|
(in thousands)
|
||||||||||||||||||
Long-term debt obligations (1)
|
|
$
|
51,528
|
|
|
$
|
3,769
|
|
|
$
|
20,400
|
|
|
$
|
6,227
|
|
|
$
|
21,132
|
|
Senior convertible note obligations (2)
|
|
68,711
|
|
|
2,455
|
|
|
66,256
|
|
|
—
|
|
|
—
|
|
|||||
Operating lease (3)
|
|
168,589
|
|
|
20,081
|
|
|
33,680
|
|
|
31,133
|
|
|
83,695
|
|
|||||
Purchase obligations (4)
|
|
4,636
|
|
|
1,549
|
|
|
3,087
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
293,464
|
|
|
$
|
27,854
|
|
|
$
|
123,423
|
|
|
$
|
37,360
|
|
|
$
|
104,827
|
|
(1)
|
Includes obligations under our working capital line of credit with Wells Fargo, financing and capital lease obligations, and estimates of interest payable under all such obligations.
|
(2)
|
Includes coupon payments of interest on the contractual payment dates and payment of the principal balance on maturity in May 2019.
|
(3)
|
Includes minimum lease payment obligations under operating leases. Amounts do not include insurance or real estate taxes, which we include in our operating expenses and which we estimate will be approximately
$3.1 million
for the less than 1 year period,
$5.2 million
for the 1 to 3 year period,
$5.2 million
for the 3 to 5 year period, and
$10.0 million
for the more than 5 years period for a total of approximately
$23.6 million
. See Note 12 to our consolidated financial statements for a description of our operating lease obligations.
|
(4)
|
Primarily represents contracts related to information technology systems.
|
•
|
our beliefs and intentions with respect to our growth strategy, including growth through acquisitions, the profitability of acquisitions, the types of acquisition targets we intend to pursue, the availability of suitable acquisition targets, our ability to identify such targets, the industry climate for dealer consolidation, and our ability to implement our growth strategy;
|
•
|
our beliefs with respect to factors that will affect demand and seasonality of purchasing in the agricultural and construction industries;
|
•
|
our beliefs with respect to our primary supplier (CNH Industrial) of equipment and parts inventory;
|
•
|
our beliefs with respect to the equipment market, our competitors and our competitive advantages;
|
•
|
our beliefs with respect to the impact of government subsidies on the agriculture economy;
|
•
|
our beliefs with respect to the impact of natural resource exploration and related commodity prices in our operating region on our operating results;
|
•
|
our beliefs with respect to the impact of government regulations;
|
•
|
our beliefs with respect to continued operations in the event of information systems inoperability;
|
•
|
our beliefs with respect to our business strengths, including the Titan Operating Model, the diversity of our customer base, and the growth rate of our shared resources expenditures and our marketing efforts;
|
•
|
our plans and beliefs with respect to real property used in our business;
|
•
|
our plans and beliefs regarding future sales, sales mix, and marketing activities;
|
•
|
our beliefs and assumptions regarding the payment of dividends and repatriation of earnings from foreign operations;
|
•
|
our beliefs and assumptions regarding valuation reserves, equipment inventory balances, fixed operating expenses, and absorption rate;
|
•
|
our beliefs and expectations regarding our restructuring activities including the amount and recognition of related costs;
|
•
|
our beliefs and expectations regarding the effects of the political climate and economy in Ukraine;
|
•
|
our beliefs and assumptions with respect to our rental equipment operations;
|
•
|
our beliefs with respect to our employee relations and the impact of employee training and management strength on our revenues;
|
•
|
our assumptions, beliefs and expectations with respect to past and future market conditions, including interest rates, and public infrastructure spending, new environmental standards, and the impact these conditions will have on our operating results;
|
•
|
our beliefs with respect to the impact of our credit agreements, including future interest expense, limits on corporate transactions, financial covenant compliance, and ability to negotiate amendments or waivers;
|
•
|
our beliefs with respect to the impact of increase or decrease in applicable foreign exchange rates;
|
•
|
our beliefs with respect to the adequacy of our capital resources and the funding of debt service obligations and capital expenditures;
|
•
|
our plans and assumptions for future capital expenditures;
|
•
|
our cash needs, sources of liquidity, and the adequacy of our working capital; and
|
•
|
our expectations regarding the impact of inflation.
|
•
|
incorrect assumptions regarding our cash needs;
|
•
|
general economic conditions and construction activity in the markets where we operate;
|
•
|
our relationships with equipment suppliers;
|
•
|
our leverage;
|
•
|
the risks associated with the expansion of our business;
|
•
|
the potential inability to integrate any businesses we acquire;
|
•
|
competitive pressures;
|
•
|
compliance with laws and regulations; and
|
•
|
other factors discussed under "Risk Factors" or elsewhere in this Form 10-K.
|
|
Page
|
Titan Machinery Inc.—Financial Statements
|
|
Audited Consolidated Financial Statements
|
|
Report of Independent Registered Public Accounting Firm
|
|
Report of Independent Registered Public Accounting Firm
|
|
Consolidated Balance Sheets as of January 31, 2018 and 2017
|
|
Consolidated Statements of Operations for the fiscal years ended January 31, 2018, 2017 and 2016
|
|
Consolidated Statements of Comprehensive Income (Loss) for the fiscal years ended January 31, 2018, 2017 and 2016
|
|
Consolidated Statements of Stockholders' Equity for the fiscal years ended January 31, 2018, 2017 and 2016
|
|
Consolidated Statements of Cash Flows for the fiscal years ended January 31, 2018, 2017 and 2016
|
|
Notes to Consolidated Financial Statements
|
|
January 31, 2018
|
|
January 31, 2017
|
||||
Assets
|
|
|
|
||||
Current Assets
|
|
|
|
||||
Cash
|
$
|
53,396
|
|
|
$
|
53,151
|
|
Receivables (net of allowance of $2,951 and $3,630 as of January 31, 2018 and January 31, 2017, respectively)
|
60,672
|
|
|
60,082
|
|
||
Inventories
|
472,467
|
|
|
478,266
|
|
||
Prepaid expenses and other
|
12,440
|
|
|
10,989
|
|
||
Income taxes receivable
|
171
|
|
|
5,380
|
|
||
Total current assets
|
599,146
|
|
|
607,868
|
|
||
Noncurrent Assets
|
|
|
|
||||
Intangible assets, net of accumulated amortization
|
5,193
|
|
|
5,001
|
|
||
Property and Equipment, net of accumulated depreciation
|
151,047
|
|
|
156,647
|
|
||
Deferred income taxes
|
3,472
|
|
|
547
|
|
||
Other
|
1,450
|
|
|
1,359
|
|
||
Total noncurrent assets
|
161,162
|
|
|
163,554
|
|
||
Total Assets
|
$
|
760,308
|
|
|
$
|
771,422
|
|
|
|
|
|
||||
Liabilities and Stockholders' Equity
|
|
|
|
||||
Current Liabilities
|
|
|
|
||||
Accounts payable
|
$
|
15,136
|
|
|
$
|
17,326
|
|
Floorplan payable
|
247,392
|
|
|
233,228
|
|
||
Current maturities of long-term debt
|
1,574
|
|
|
1,373
|
|
||
Customer deposits
|
32,324
|
|
|
26,366
|
|
||
Accrued expenses and other
|
31,863
|
|
|
30,533
|
|
||
Total current liabilities
|
328,289
|
|
|
308,826
|
|
||
Long-Term Liabilities
|
|
|
|
||||
Senior convertible notes
|
62,819
|
|
|
88,501
|
|
||
Long-term debt, less current maturities
|
34,578
|
|
|
38,236
|
|
||
Deferred income taxes
|
2,275
|
|
|
9,500
|
|
||
Other long-term liabilities
|
10,492
|
|
|
5,180
|
|
||
Total long-term liabilities
|
110,164
|
|
|
141,417
|
|
||
Commitments and Contingencies (Notes 11 and 12)
|
|
|
|
||||
Stockholders' Equity
|
|
|
|
||||
Common stock, par value $.00001 per share, 45,000 shares authorized; 22,102 shares issued and outstanding at January 31, 2018; 21,836 shares issued and outstanding at January 31, 2017
|
—
|
|
|
—
|
|
||
Additional paid-in-capital
|
246,509
|
|
|
240,615
|
|
||
Retained earnings
|
77,046
|
|
|
85,347
|
|
||
Accumulated other comprehensive loss
|
(1,700
|
)
|
|
(4,783
|
)
|
||
Total stockholders' equity
|
321,855
|
|
|
321,179
|
|
||
Total Liabilities and Stockholders' Equity
|
$
|
760,308
|
|
|
$
|
771,422
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
Revenue
|
|
|
|
|
|
||||||
Equipment
|
$
|
804,361
|
|
|
$
|
797,315
|
|
|
$
|
925,471
|
|
Parts
|
222,404
|
|
|
233,819
|
|
|
245,387
|
|
|||
Service
|
117,318
|
|
|
124,076
|
|
|
127,457
|
|
|||
Rental and other
|
58,855
|
|
|
57,870
|
|
|
69,520
|
|
|||
Total Revenue
|
1,202,938
|
|
|
1,213,080
|
|
|
1,367,835
|
|
|||
Cost of Revenue
|
|
|
|
|
|
||||||
Equipment
|
743,465
|
|
|
746,169
|
|
|
889,567
|
|
|||
Parts
|
156,455
|
|
|
164,020
|
|
|
173,083
|
|
|||
Service
|
44,141
|
|
|
46,284
|
|
|
46,814
|
|
|||
Rental and other
|
43,577
|
|
|
42,878
|
|
|
52,457
|
|
|||
Total Cost of Revenue
|
987,638
|
|
|
999,351
|
|
|
1,161,921
|
|
|||
Gross Profit
|
215,300
|
|
|
213,729
|
|
|
205,914
|
|
|||
Operating Expenses
|
203,203
|
|
|
211,372
|
|
|
220,524
|
|
|||
Impairment of Long-Lived Assets
|
673
|
|
|
4,410
|
|
|
6,903
|
|
|||
Restructuring Costs
|
10,499
|
|
|
319
|
|
|
1,597
|
|
|||
Income (Loss) from Operations
|
925
|
|
|
(2,372
|
)
|
|
(23,110
|
)
|
|||
Other Income (Expense)
|
|
|
|
|
|
||||||
Interest income and other income (expense)
|
1,635
|
|
|
1,524
|
|
|
(478
|
)
|
|||
Floorplan interest expense
|
(8,152
|
)
|
|
(13,560
|
)
|
|
(18,334
|
)
|
|||
Other interest expense
|
(8,847
|
)
|
|
(8,305
|
)
|
|
(14,289
|
)
|
|||
Loss Before Income Taxes
|
(14,439
|
)
|
|
(22,713
|
)
|
|
(56,211
|
)
|
|||
Benefit from Income Taxes
|
(7,390
|
)
|
|
(8,178
|
)
|
|
(17,982
|
)
|
|||
Net Loss Including Noncontrolling Interest
|
(7,049
|
)
|
|
(14,535
|
)
|
|
(38,229
|
)
|
|||
Less: Net Loss Attributable to Noncontrolling Interest
|
—
|
|
|
(356
|
)
|
|
(337
|
)
|
|||
Net Loss Attributable to Titan Machinery Inc.
|
(7,049
|
)
|
|
(14,179
|
)
|
|
(37,892
|
)
|
|||
Net Loss Allocated to Participating Securities - Note 1
|
141
|
|
|
243
|
|
|
717
|
|
|||
Net Loss Attributable to Titan Machinery Inc. Common Stockholders
|
$
|
(6,908
|
)
|
|
$
|
(13,936
|
)
|
|
$
|
(37,175
|
)
|
Earnings (Loss) per Share - Note 1
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.32
|
)
|
|
$
|
(0.65
|
)
|
|
$
|
(1.76
|
)
|
Diluted
|
$
|
(0.32
|
)
|
|
$
|
(0.65
|
)
|
|
$
|
(1.76
|
)
|
Weighted Average Common Shares
|
|
|
|
|
|
||||||
Basic
|
21,543
|
|
|
21,294
|
|
|
21,111
|
|
|||
Diluted
|
21,543
|
|
|
21,294
|
|
|
21,111
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net Loss Including Noncontrolling Interest
|
$
|
(7,049
|
)
|
|
$
|
(14,535
|
)
|
|
$
|
(38,229
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
2,399
|
|
|
(1,090
|
)
|
|
(4,598
|
)
|
|||
Unrealized gain on net investment hedge derivative instruments, net of tax expense of $132 for the year ended January 31, 2016
|
—
|
|
|
—
|
|
|
201
|
|
|||
Unrealized gain (loss) on interest rate swap cash flow hedge derivative instrument, net of tax expense (benefit) of $19, $105, and ($524) for the years ended January 31, 2018, 2017 and 2016
|
29
|
|
|
158
|
|
|
(785
|
)
|
|||
Reclassification of loss on interest rate swap cash flow hedge derivative instrument included in net loss, net of tax benefit of $436, $554, and $702 for the years ended January 31, 2018, 2017 and 2016
|
655
|
|
|
830
|
|
|
1,053
|
|
|||
Reclassification of loss on foreign currency contract cash flow hedge derivative instruments included in net loss, net of tax benefit of $24 for the years ended January 31, 2016
|
—
|
|
|
—
|
|
|
37
|
|
|||
Total Other Comprehensive Income (Loss)
|
3,083
|
|
|
(102
|
)
|
|
(4,092
|
)
|
|||
Comprehensive Loss
|
(3,966
|
)
|
|
(14,637
|
)
|
|
(42,321
|
)
|
|||
Comprehensive Loss Attributable to Noncontrolling Interest
|
—
|
|
|
(333
|
)
|
|
(1,067
|
)
|
|||
Comprehensive Loss Attributable To Titan Machinery Inc.
|
$
|
(3,966
|
)
|
|
$
|
(14,304
|
)
|
|
$
|
(41,254
|
)
|
|
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, 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
|
198
|
|
|
—
|
|
|
208
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
208
|
|
|
—
|
|
|
208
|
|
|||||||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
2,103
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,103
|
|
|
—
|
|
|
2,103
|
|
|||||||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||||
Comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
(37,892
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(37,892
|
)
|
|
(337
|
)
|
|
(38,229
|
)
|
|||||||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,868
|
)
|
|
201
|
|
|
268
|
|
|
37
|
|
|
(3,362
|
)
|
|
(3,362
|
)
|
|
(730
|
)
|
|
(4,092
|
)
|
|||||||||||
Total comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(41,254
|
)
|
|
(1,067
|
)
|
|
(42,321
|
)
|
|||||||||||
BALANCE, JANUARY 31, 2016
|
21,604
|
|
|
—
|
|
|
242,491
|
|
|
99,526
|
|
|
(5,500
|
)
|
|
2,711
|
|
|
(1,672
|
)
|
|
—
|
|
|
(4,461
|
)
|
|
337,556
|
|
|
793
|
|
|
338,349
|
|
|||||||||||
Common stock issued on grant of restricted stock (net of forfeitures), exercise of stock options, and tax benefits of equity awards
|
232
|
|
|
—
|
|
|
(355
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(355
|
)
|
|
—
|
|
|
(355
|
)
|
|||||||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
2,145
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,145
|
|
|
—
|
|
|
2,145
|
|
|||||||||||
Acquisition of non-controlling interest
|
—
|
|
|
—
|
|
|
(3,666
|
)
|
|
—
|
|
|
(197
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(197
|
)
|
|
(3,863
|
)
|
|
(460
|
)
|
|
(4,323
|
)
|
|||||||||||
Comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(14,179
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14,179
|
)
|
|
(356
|
)
|
|
(14,535
|
)
|
|||||||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,113
|
)
|
|
—
|
|
|
988
|
|
|
—
|
|
|
(125
|
)
|
|
(125
|
)
|
|
23
|
|
|
(102
|
)
|
|||||||||||
Total comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14,304
|
)
|
|
(333
|
)
|
|
(14,637
|
)
|
|||||||||||
BALANCE, JANUARY 31, 2017
|
21,836
|
|
|
—
|
|
|
240,615
|
|
|
85,347
|
|
|
(6,810
|
)
|
|
2,711
|
|
|
(684
|
)
|
|
—
|
|
|
(4,783
|
)
|
|
321,179
|
|
|
—
|
|
|
321,179
|
|
|||||||||||
ASU 2016-09 cumulative effect adjustment
|
—
|
|
|
—
|
|
|
2,087
|
|
|
(1,252
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
835
|
|
|
—
|
|
|
835
|
|
|||||||||||
Common stock issued on grant of restricted stock (net of forfeitures), exercise of stock options, and tax benefits of equity awards
|
266
|
|
|
—
|
|
|
989
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
989
|
|
|
—
|
|
|
989
|
|
|||||||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
3,441
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,441
|
|
|
—
|
|
|
3,441
|
|
|||||||||||
Repurchase of Senior Convertible Notes
|
—
|
|
|
—
|
|
|
(623
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(623
|
)
|
|
—
|
|
|
(623
|
)
|
|||||||||||
Comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,049
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,049
|
)
|
|
—
|
|
|
(7,049
|
)
|
|||||||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,399
|
|
|
—
|
|
|
684
|
|
|
—
|
|
|
3,083
|
|
|
3,083
|
|
|
—
|
|
|
3,083
|
|
|||||||||||
Total comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,966
|
)
|
|
—
|
|
|
(3,966
|
)
|
|||||||||||
BALANCE, JANUARY 31, 2018
|
22,102
|
|
|
$
|
—
|
|
|
$
|
246,509
|
|
|
$
|
77,046
|
|
|
$
|
(4,411
|
)
|
|
$
|
2,711
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1,700
|
)
|
|
$
|
321,855
|
|
|
$
|
—
|
|
|
$
|
321,855
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
Operating Activities
|
|
|
|
|
|
||||||
Net loss including noncontrolling interest
|
$
|
(7,049
|
)
|
|
$
|
(14,535
|
)
|
|
$
|
(38,229
|
)
|
Adjustments to reconcile net loss including noncontrolling interest to net cash provided by operating activities
|
|
|
|
|
|
||||||
Depreciation and amortization
|
25,105
|
|
|
26,868
|
|
|
28,538
|
|
|||
Impairment of long-lived assets
|
673
|
|
|
4,410
|
|
|
6,903
|
|
|||
Deferred income taxes
|
(8,920
|
)
|
|
(2,841
|
)
|
|
(9,171
|
)
|
|||
Stock-based compensation expense
|
3,441
|
|
|
2,145
|
|
|
2,103
|
|
|||
Noncash interest expense
|
3,651
|
|
|
5,314
|
|
|
6,717
|
|
|||
Gain on repurchase of Senior Convertible Notes
|
(22
|
)
|
|
(3,130
|
)
|
|
—
|
|
|||
Other, net
|
(2,406
|
)
|
|
(925
|
)
|
|
(696
|
)
|
|||
Changes in assets and liabilities
|
|
|
|
|
|
||||||
Receivables, prepaid expenses and other assets
|
(1,002
|
)
|
|
(1,885
|
)
|
|
24,326
|
|
|||
Inventories
|
20,338
|
|
|
211,793
|
|
|
196,983
|
|
|||
Manufacturer floorplan payable
|
46,141
|
|
|
(95,341
|
)
|
|
45,005
|
|
|||
Accounts payable, customer deposits, accrued expenses and other long-term liabilities
|
8,445
|
|
|
1,824
|
|
|
(14,318
|
)
|
|||
Income taxes
|
7,417
|
|
|
7,300
|
|
|
(16,277
|
)
|
|||
Net Cash Provided by Operating Activities
|
95,812
|
|
|
140,997
|
|
|
231,884
|
|
|||
Investing Activities
|
|
|
|
|
|
||||||
Rental fleet purchases
|
(12,578
|
)
|
|
(3,137
|
)
|
|
(341
|
)
|
|||
Property and equipment purchases (excluding rental fleet)
|
(13,537
|
)
|
|
(9,288
|
)
|
|
(8,070
|
)
|
|||
Proceeds from sale of property and equipment
|
5,030
|
|
|
2,388
|
|
|
7,777
|
|
|||
Acquisition consideration, net of cash acquired
|
(3,652
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from insurance recoveries
|
—
|
|
|
1,431
|
|
|
—
|
|
|||
Other, net
|
148
|
|
|
(519
|
)
|
|
508
|
|
|||
Net Cash Used for Investing Activities
|
(24,589
|
)
|
|
(9,125
|
)
|
|
(126
|
)
|
|||
Financing Activities
|
|
|
|
|
|
||||||
Net change in non-manufacturer floorplan payable
|
(38,626
|
)
|
|
(116,558
|
)
|
|
(221,912
|
)
|
|||
Repurchase of Senior Convertible Notes
|
(29,093
|
)
|
|
(46,013
|
)
|
|
|
|
|||
Proceeds from long-term debt borrowings
|
33,001
|
|
|
14,009
|
|
|
72,907
|
|
|||
Principal payments on long-term debt
|
(36,786
|
)
|
|
(17,199
|
)
|
|
(116,876
|
)
|
|||
Loan provided to non-controlling interest holder
|
—
|
|
|
(2,148
|
)
|
|
—
|
|
|||
Payment of debt issuance costs
|
(27
|
)
|
|
(34
|
)
|
|
(3,397
|
)
|
|||
Other, net
|
65
|
|
|
(33
|
)
|
|
322
|
|
|||
Net Cash Used for Financing Activities
|
(71,466
|
)
|
|
(167,976
|
)
|
|
(268,956
|
)
|
|||
Effect of Exchange Rate Changes on Cash
|
488
|
|
|
(210
|
)
|
|
(865
|
)
|
|||
Net Change in Cash
|
245
|
|
|
(36,314
|
)
|
|
(38,063
|
)
|
|||
Cash at Beginning of Period
|
53,151
|
|
|
89,465
|
|
|
127,528
|
|
|||
Cash at End of Period
|
$
|
53,396
|
|
|
$
|
53,151
|
|
|
$
|
89,465
|
|
Supplemental Disclosures of Cash Flow Information
|
|
|
|
|
|
||||||
Cash paid during the period
|
|
|
|
|
|
||||||
Income taxes, net of refunds
|
$
|
(5,555
|
)
|
|
$
|
(13,086
|
)
|
|
$
|
7,324
|
|
Interest
|
$
|
13,634
|
|
|
$
|
20,782
|
|
|
$
|
25,840
|
|
Supplemental Disclosures of Noncash Investing and Financing Activities
|
|
|
|
|
|
||||||
Net property and equipment financed with long-term debt, accounts payable and accrued liabilities
|
$
|
752
|
|
|
$
|
2,496
|
|
|
$
|
12,156
|
|
Business combination assets acquired through direct financing
|
$
|
871
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Long-term debt extinguished upon sale of property and equipment
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,315
|
|
Net transfer of assets from property and equipment to inventories
|
$
|
3,609
|
|
|
$
|
7,454
|
|
|
$
|
3,912
|
|
Acquisition of non-controlling interest through satisfaction of outstanding receivables
|
$
|
—
|
|
|
$
|
4,324
|
|
|
$
|
—
|
|
•
|
CNH Industrial provides floorplan payable financing for the purchase of a substantial portion of the Company's inventory
|
•
|
CNH Industrial provides a significant percentage of the financing and lease financing used by the Company's customers to purchase CNH Industrial equipment from the Company.
|
Buildings and leasehold improvements
|
Lesser of 10 - 40 years or lease term
|
Machinery and equipment
|
3 - 10 years
|
Furniture and fixtures
|
3 - 10 years
|
Vehicles
|
5 - 10 years
|
Rental fleet
|
3 - 10 years
|
|
Year Ended January 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(in thousands, except per share data)
|
||||||||||
Basic Weighted-Average Common Shares Outstanding
|
21,543
|
|
|
21,294
|
|
|
21,111
|
|
|||
Plus: Incremental Shares From Assumed Exercise of Stock Options
|
—
|
|
|
—
|
|
|
—
|
|
|||
Diluted Weighted-Average Common Shares Outstanding
|
21,543
|
|
|
21,294
|
|
|
21,111
|
|
|||
|
|
|
|
|
|
||||||
Anti-Dilutive Shares Excluded From Diluted Weighted-Average Common Shares Outstanding
|
|
|
|
|
|
||||||
Stock Options
|
87
|
|
|
139
|
|
|
174
|
|
|||
Shares Underlying Senior Convertible Notes (conversion price of $43.17)
|
1,521
|
|
|
2,217
|
|
|
3,474
|
|
|||
|
|
|
|
|
|
||||||
Earnings (Loss) per Share
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.32
|
)
|
|
$
|
(0.65
|
)
|
|
$
|
(1.76
|
)
|
Diluted
|
$
|
(0.32
|
)
|
|
$
|
(0.65
|
)
|
|
$
|
(1.76
|
)
|
|
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
|
)
|
|
January 31, 2018
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
Trade accounts receivable
|
|
|
|
||||
Due from customers
|
$
|
32,829
|
|
|
$
|
31,636
|
|
Due from finance companies
|
8,906
|
|
|
14,319
|
|
||
Due from manufacturers
|
10,074
|
|
|
9,107
|
|
||
Unbilled receivables due from customers
|
11,814
|
|
|
8,650
|
|
||
Total trade accounts receivable
|
63,623
|
|
|
63,712
|
|
||
Less allowance for doubtful accounts
|
(2,951
|
)
|
|
(3,630
|
)
|
||
|
$
|
60,672
|
|
|
$
|
60,082
|
|
|
January 31, 2018
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
New equipment
|
$
|
258,559
|
|
|
$
|
235,161
|
|
Used equipment
|
141,450
|
|
|
160,503
|
|
||
Parts and attachments
|
71,110
|
|
|
81,734
|
|
||
Work in process
|
1,348
|
|
|
868
|
|
||
|
$
|
472,467
|
|
|
$
|
478,266
|
|
|
January 31, 2018
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
Rental fleet equipment
|
$
|
123,430
|
|
|
$
|
124,417
|
|
Machinery and equipment
|
22,025
|
|
|
22,255
|
|
||
Vehicles
|
37,741
|
|
|
36,384
|
|
||
Furniture and fixtures
|
39,851
|
|
|
39,875
|
|
||
Land, buildings, and leasehold improvements
|
62,243
|
|
|
59,481
|
|
||
|
285,290
|
|
|
282,412
|
|
||
Less accumulated depreciation
|
(134,243
|
)
|
|
(125,765
|
)
|
||
|
$
|
151,047
|
|
|
$
|
156,647
|
|
|
January 31, 2018
|
|
January 31, 2017
|
||||||||||||||||||||
|
Cost
|
|
Accumulated
Amortization
|
|
Net
|
|
Cost
|
|
Accumulated
Amortization
|
|
Net
|
||||||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||||||||||
Covenants not to compete
|
$
|
440
|
|
|
$
|
(369
|
)
|
|
$
|
71
|
|
|
$
|
970
|
|
|
$
|
(851
|
)
|
|
$
|
119
|
|
|
$
|
440
|
|
|
$
|
(369
|
)
|
|
$
|
71
|
|
|
$
|
970
|
|
|
$
|
(851
|
)
|
|
$
|
119
|
|
Years ending January 31,
|
Amount
|
||
|
(in thousands)
|
||
2019
|
$
|
32
|
|
2020
|
20
|
|
|
2021
|
9
|
|
|
2022
|
5
|
|
|
2023
|
5
|
|
|
|
$
|
71
|
|
i.
|
During any fiscal quarter commencing after July 31, 2012, if for at least 20 trading days (whether or not consecutive) during the
30
consecutive trading day period ending on the last trading day of the immediately preceding fiscal quarter, the last reported sale price of the Company's common stock on such trading day is greater than or equal to
120%
of the applicable conversion price on such trading day.
|
ii.
|
During the
five
consecutive business day period immediately following any
five
consecutive trading day period in which, for each trading day of that period, the trading price per $1,000 principal amount of the Senior Convertible Notes is less than
98%
of the product of the last reported sale price of the Company's common stock on such trading day and the applicable conversion rate on such trading day.
|
iii.
|
If the Company calls any or all of the Senior Convertible Notes for redemption at any time prior to the close of business on the business day immediately preceding the redemption date.
|
iv.
|
Upon the occurrence of corporate transactions specified in the Indenture.
|
v.
|
At any time on and after February 1, 2019 until the close of business on the business day immediately preceding the maturity date.
|
|
January 31, 2018
|
|
January 31, 2017
|
||||
|
(in thousands, except conversion rate and conversion price)
|
||||||
Principal value
|
$
|
65,644
|
|
|
$
|
95,725
|
|
Unamortized debt discount
|
(2,497
|
)
|
|
(6,368
|
)
|
||
Unamortized debt issuance costs
|
(328
|
)
|
|
(856
|
)
|
||
Carrying value of senior convertible notes
|
$
|
62,819
|
|
|
$
|
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
|
|
|
|
|
Year Ended January 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(in thousands)
|
||||||||||
Cash Interest Expense
|
|
|
|
|
|
||||||
Coupon interest expense
|
$
|
2,782
|
|
|
$
|
4,355
|
|
|
$
|
5,625
|
|
Noncash Interest Expense
|
|
|
|
|
|
||||||
Amortization of debt discount
|
2,104
|
|
|
2,849
|
|
|
3,703
|
|
|||
Amortization of transaction costs
|
290
|
|
|
439
|
|
|
552
|
|
|||
|
$
|
5,176
|
|
|
$
|
7,643
|
|
|
$
|
9,880
|
|
|
Sale-Leaseback Financing Obligations & Capital Leases
|
|
|
|
Total Present Value of Minimum Lease Payments and Other Long-Term Debt
|
||||||||||||||
Years Ending January 31,
|
Minimum Lease Payments
|
|
Interest
|
|
Present Value of Minimum Lease Payments
|
|
Other Long-Term Debt
|
|
|||||||||||
|
(in thousands)
|
||||||||||||||||||
2019
|
$
|
3,372
|
|
|
$
|
1,798
|
|
|
$
|
1,574
|
|
|
$
|
—
|
|
|
$
|
1,574
|
|
2020
|
3,448
|
|
|
1,712
|
|
|
1,736
|
|
|
13,000
|
|
|
14,736
|
|
|||||
2021
|
3,324
|
|
|
1,701
|
|
|
1,623
|
|
|
—
|
|
|
1,623
|
|
|||||
2022
|
3,161
|
|
|
1,592
|
|
|
1,569
|
|
|
—
|
|
|
1,569
|
|
|||||
2023
|
3,066
|
|
|
1,474
|
|
|
1,592
|
|
|
—
|
|
|
1,592
|
|
|||||
Thereafter
|
21,133
|
|
|
6,075
|
|
|
15,058
|
|
|
—
|
|
|
15,058
|
|
|||||
|
$
|
37,504
|
|
|
$
|
14,352
|
|
|
$
|
23,152
|
|
|
$
|
13,000
|
|
|
$
|
36,152
|
|
|
Year Ended January 31,
|
||||||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||||||||||||||
|
OCI
|
|
Income
|
|
OCI
|
|
Income
|
|
OCI
|
|
Income
|
||||||||||||
|
(in thousands)
|
|
(in thousands)
|
|
(in thousands)
|
||||||||||||||||||
Derivatives Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net investment hedges:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency contracts
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
333
|
|
|
$
|
—
|
|
Cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate swap (a)
|
48
|
|
|
(1,091
|
)
|
|
263
|
|
|
(1,384
|
)
|
|
(1,309
|
)
|
|
(1,755
|
)
|
||||||
Foreign currency contracts (b)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(61
|
)
|
||||||
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign currency contracts (c)
|
—
|
|
|
(1,510
|
)
|
|
—
|
|
|
365
|
|
|
—
|
|
|
996
|
|
||||||
Total Derivatives
|
$
|
48
|
|
|
$
|
(2,601
|
)
|
|
$
|
263
|
|
|
$
|
(1,019
|
)
|
|
$
|
(976
|
)
|
|
$
|
(820
|
)
|
|
January 31, 2018
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
Compensation
|
$
|
16,413
|
|
|
$
|
16,163
|
|
Sales, payroll, real estate and value added taxes
|
4,448
|
|
|
3,871
|
|
||
Interest
|
1,148
|
|
|
1,372
|
|
||
Insurance
|
3,004
|
|
|
1,524
|
|
||
Income taxes payable
|
2,419
|
|
|
144
|
|
||
Derivative liabilities
|
—
|
|
|
1,355
|
|
||
Other
|
4,431
|
|
|
6,104
|
|
||
|
$
|
31,863
|
|
|
$
|
30,533
|
|
Years ending January 31,
|
Amount
|
||
|
(in thousands)
|
||
2019
|
$
|
20,081
|
|
2020
|
17,668
|
|
|
2021
|
16,012
|
|
|
2022
|
15,708
|
|
|
2023
|
15,425
|
|
|
Thereafter
|
83,695
|
|
|
|
$
|
168,589
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
(in thousands)
|
||||||||||
U.S.
|
$
|
(16,644
|
)
|
|
$
|
(22,244
|
)
|
|
$
|
(53,211
|
)
|
Foreign
|
2,205
|
|
|
(469
|
)
|
|
(3,000
|
)
|
|||
Total
|
$
|
(14,439
|
)
|
|
$
|
(22,713
|
)
|
|
$
|
(56,211
|
)
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
(in thousands)
|
||||||||||
Current
|
|
|
|
|
|
||||||
Federal
|
$
|
130
|
|
|
$
|
(5,368
|
)
|
|
$
|
(9,193
|
)
|
State
|
50
|
|
|
(85
|
)
|
|
147
|
|
|||
Foreign
|
1,350
|
|
|
116
|
|
|
235
|
|
|||
Total current taxes
|
1,530
|
|
|
(5,337
|
)
|
|
(8,811
|
)
|
|||
Deferred
|
|
|
|
|
|
||||||
Federal
|
(6,247
|
)
|
|
(1,819
|
)
|
|
(7,766
|
)
|
|||
State
|
270
|
|
|
(471
|
)
|
|
(1,427
|
)
|
|||
Foreign
|
(2,943
|
)
|
|
(551
|
)
|
|
22
|
|
|||
Total deferred taxes
|
(8,920
|
)
|
|
(2,841
|
)
|
|
(9,171
|
)
|
|||
|
$
|
(7,390
|
)
|
|
$
|
(8,178
|
)
|
|
$
|
(17,982
|
)
|
|
2018
|
|
2017
|
|
2016
|
|||
U.S. statutory rate
|
(33.8
|
)%
|
|
(35.0
|
)%
|
|
(35.0
|
)%
|
Foreign statutory rates
|
1.4
|
%
|
|
2.8
|
%
|
|
0.6
|
%
|
State taxes on income net of federal tax benefit
|
(4.3
|
)%
|
|
(4.3
|
)%
|
|
(4.1
|
)%
|
Valuation allowances
|
(4.4
|
)%
|
|
(2.7
|
)%
|
|
5.7
|
%
|
U.S. statutory rate reduction
|
(13.9
|
)%
|
|
—
|
%
|
|
—
|
%
|
All other, net
|
3.8
|
%
|
|
3.2
|
%
|
|
0.8
|
%
|
|
(51.2
|
)%
|
|
(36.0
|
)%
|
|
(32.0
|
)%
|
|
2018
|
|
2017
|
||||
|
(in thousands)
|
||||||
Deferred tax assets:
|
|
|
|
||||
Inventory allowances
|
$
|
5,061
|
|
|
$
|
11,622
|
|
Intangible Assets
|
3,763
|
|
|
6,065
|
|
||
Net operating losses
|
12,366
|
|
|
6,679
|
|
||
Accrued liabilities and other
|
5,084
|
|
|
4,573
|
|
||
Receivables
|
719
|
|
|
1,034
|
|
||
Hedging and derivatives
|
—
|
|
|
541
|
|
||
Stock-based compensation
|
1,119
|
|
|
845
|
|
||
Other
|
1,241
|
|
|
1,060
|
|
||
Total deferred tax assets
|
29,353
|
|
|
32,419
|
|
||
Valuation allowances
|
(7,717
|
)
|
|
(8,968
|
)
|
||
Deferred tax assets, net of valuation allowances
|
$
|
21,636
|
|
|
$
|
23,451
|
|
|
|
|
|
||||
Deferred tax liabilities:
|
|
|
|
||||
Property and equipment
|
$
|
(19,810
|
)
|
|
$
|
(29,942
|
)
|
Senior convertible notes
|
(629
|
)
|
|
(2,462
|
)
|
||
Total deferred tax liabilities
|
$
|
(20,439
|
)
|
|
$
|
(32,404
|
)
|
|
|
|
|
||||
Net deferred tax asset (liability)
|
$
|
1,197
|
|
|
$
|
(8,953
|
)
|
|
Number of Stock Options
|
|
Weighted Average Exercise Price
|
|
Aggregate Intrinsic Value
|
|
Weighted Average Remaining Contractual Life (Years)
|
|||||
|
(in thousands)
|
|
|
|
(in thousands)
|
|
|
|||||
Outstanding at January 31, 2017
|
271
|
|
|
$
|
12.50
|
|
|
$
|
1,008
|
|
|
1.0
|
Granted
|
—
|
|
|
—
|
|
|
|
|
|
|||
Exercised
|
(184
|
)
|
|
8.90
|
|
|
|
|
|
|||
Forfeited
|
(19
|
)
|
|
14.31
|
|
|
|
|
|
|||
Outstanding at January 31, 2018
|
68
|
|
|
$
|
21.63
|
|
|
$
|
18
|
|
|
0.5
|
Exercisable at January 31, 2018
|
68
|
|
|
$
|
21.63
|
|
|
$
|
18
|
|
|
0.5
|
|
|
Stock Options Outstanding and Exercisable
|
|||||||
Range of Exercise Prices
|
|
Number
|
|
Weighted Average Remaining Contractual Life (Years)
|
|
Weighted Average Exercise Price
|
|||
|
|
(in thousands)
|
|
|
|
|
|||
$ 10.20-14.69
|
|
6
|
|
|
0.8
|
|
$
|
10.97
|
|
$ 21.21-26.84
|
|
62
|
|
|
0.5
|
|
22.71
|
|
|
|
|
68
|
|
|
0.5
|
|
$
|
21.63
|
|
|
Shares
|
|
Weighted Average Grant Date Fair Value
|
|
Weighted Average Remaining Contractual Life (Years)
|
|||
|
(in thousands)
|
|
|
|
|
|||
Nonvested at January 31, 2017
|
509
|
|
|
$
|
14.83
|
|
|
2.6
|
Granted
|
130
|
|
|
17.47
|
|
|
|
|
Forfeited
|
(32
|
)
|
|
15.13
|
|
|
|
|
Vested
|
(201
|
)
|
|
15.03
|
|
|
|
|
Nonvested at January 31, 2018
|
406
|
|
|
$
|
16.24
|
|
|
2.2
|
|
Shares
|
|
Weighted Average Grant Date Fair Value
|
|
Weighted Average Remaining Contractual Life (Years)
|
|||
|
(in thousands)
|
|
|
|
|
|||
Nonvested at January 31, 2017
|
72
|
|
|
$
|
18.57
|
|
|
1.0
|
Granted
|
11
|
|
|
17.58
|
|
|
|
|
Forfeited
|
(58
|
)
|
|
16.72
|
|
|
|
|
Vested
|
(3
|
)
|
|
11.63
|
|
|
|
|
Nonvested at January 31, 2018
|
22
|
|
|
$
|
14.70
|
|
|
2.8
|
|
January 31, 2018
|
|
January 31, 2017
|
||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||||||||||||||||||
Financial Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Foreign currency contracts
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total Financial Assets
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Financial Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Interest rate swap
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,155
|
|
|
$
|
—
|
|
|
$
|
1,155
|
|
Foreign currency contracts
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
200
|
|
|
—
|
|
|
200
|
|
||||||||
Total Financial Liabilities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,355
|
|
|
$
|
—
|
|
|
$
|
1,355
|
|
|
January 31, 2018
|
|
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
|
|
|
$
|
62,819
|
|
|
$
|
65,644
|
|
|
$
|
87,000
|
|
|
$
|
88,501
|
|
|
$
|
95,725
|
|
|
|
|
Year Ended January 31,
|
||||||||
|
Cumulative Amount
|
|
2018
|
|
2017
|
||||||
|
(in thousands)
|
||||||||||
Lease accrual and termination costs
|
$
|
5,681
|
|
|
$
|
5,681
|
|
|
$
|
—
|
|
Termination benefits
|
5,053
|
|
|
5,053
|
|
|
—
|
|
|||
Impairment of fixed assets, net of gains on asset disposition
|
2,206
|
|
|
(751
|
)
|
|
2,957
|
|
|||
Asset relocation and other costs
|
516
|
|
|
516
|
|
|
—
|
|
|||
|
$
|
13,456
|
|
|
$
|
10,499
|
|
|
$
|
2,957
|
|
|
Year Ended January 31,
|
||||||
|
2017
|
|
2016
|
||||
|
|
||||||
Lease accrual and termination costs
|
$
|
(128
|
)
|
|
$
|
692
|
|
Termination benefits
|
399
|
|
|
774
|
|
||
Impairment of fixed assets, net of gains on asset disposition
|
—
|
|
|
369
|
|
||
Asset relocation and other costs
|
48
|
|
|
126
|
|
||
|
$
|
319
|
|
|
$
|
1,961
|
|
|
|
Lease Accrual & Termination Costs
|
|
Termination Benefits
|
|
Asset Relocation & Other Costs
|
|
Total
|
||||||
|
|
(in thousands)
|
||||||||||||
Balance, January 31, 2017
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Exit costs incurred and charged to expense
|
|
5,681
|
|
|
4,568
|
|
|
516
|
|
|
10,765
|
|
||
Exit costs paid
|
|
(288
|
)
|
|
(4,164
|
)
|
|
(516
|
)
|
|
(4,968
|
)
|
||
Balance, January 31, 2018
|
|
5,393
|
|
|
404
|
|
|
—
|
|
|
5,797
|
|
|
Year Ended January 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(in thousands)
|
||||||||||
Revenue
|
|
|
|
|
|
||||||
Agriculture
|
$
|
694,025
|
|
|
$
|
739,167
|
|
|
$
|
864,851
|
|
Construction
|
300,019
|
|
|
323,625
|
|
|
340,916
|
|
|||
International
|
208,894
|
|
|
150,288
|
|
|
162,068
|
|
|||
Total
|
$
|
1,202,938
|
|
|
$
|
1,213,080
|
|
|
$
|
1,367,835
|
|
Income (Loss) Before Income Taxes
|
|
|
|
|
|
||||||
Agriculture
|
$
|
(3,678
|
)
|
|
$
|
(15,781
|
)
|
|
$
|
(29,710
|
)
|
Construction
|
(7,278
|
)
|
|
(5,875
|
)
|
|
(26,388
|
)
|
|||
International
|
2,205
|
|
|
(469
|
)
|
|
(3,004
|
)
|
|||
Segment income (loss) before income taxes
|
(8,751
|
)
|
|
(22,125
|
)
|
|
(59,102
|
)
|
|||
Shared Resources
|
(5,688
|
)
|
|
(588
|
)
|
|
2,891
|
|
|||
Total
|
$
|
(14,439
|
)
|
|
$
|
(22,713
|
)
|
|
$
|
(56,211
|
)
|
Total Impairment
|
|
|
|
|
|
||||||
Agriculture
|
$
|
175
|
|
|
$
|
1,888
|
|
|
$
|
3,975
|
|
Construction
|
498
|
|
|
2,155
|
|
|
2,752
|
|
|||
International
|
—
|
|
|
325
|
|
|
—
|
|
|||
Segment impairment
|
673
|
|
|
4,368
|
|
|
6,727
|
|
|||
Shared Resources
|
—
|
|
|
42
|
|
|
176
|
|
|||
Total
|
$
|
673
|
|
|
$
|
4,410
|
|
|
$
|
6,903
|
|
|
Year Ended January 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Restructuring Costs
|
|
|
|
|
|
||||||
Agriculture
|
$
|
6,886
|
|
|
$
|
(120
|
)
|
|
$
|
738
|
|
Construction
|
2,093
|
|
|
60
|
|
|
635
|
|
|||
International
|
62
|
|
|
—
|
|
|
—
|
|
|||
Segment impairment
|
9,041
|
|
|
(60
|
)
|
|
1,373
|
|
|||
Shared Resources
|
1,458
|
|
|
379
|
|
|
224
|
|
|||
Total
|
$
|
10,499
|
|
|
$
|
319
|
|
|
$
|
1,597
|
|
Interest Income
|
|
|
|
|
|
||||||
Agriculture
|
$
|
164
|
|
|
$
|
183
|
|
|
$
|
159
|
|
Construction
|
314
|
|
|
341
|
|
|
396
|
|
|||
International
|
9
|
|
|
31
|
|
|
68
|
|
|||
Segment interest income
|
487
|
|
|
555
|
|
|
623
|
|
|||
Shared Resources
|
9
|
|
|
12
|
|
|
17
|
|
|||
Total
|
$
|
496
|
|
|
$
|
567
|
|
|
$
|
640
|
|
Interest Expense
|
|
|
|
|
|
||||||
Agriculture
|
$
|
5,781
|
|
|
$
|
11,201
|
|
|
$
|
15,596
|
|
Construction
|
7,750
|
|
|
10,196
|
|
|
12,575
|
|
|||
International
|
2,510
|
|
|
2,884
|
|
|
4,159
|
|
|||
Segment interest expense
|
16,041
|
|
|
24,281
|
|
|
32,330
|
|
|||
Shared Resources
|
958
|
|
|
(2,416
|
)
|
|
293
|
|
|||
Total
|
$
|
16,999
|
|
|
$
|
21,865
|
|
|
$
|
32,623
|
|
Depreciation and Amortization
|
|
|
|
|
|
||||||
Agriculture
|
$
|
5,411
|
|
|
$
|
6,128
|
|
|
$
|
7,760
|
|
Construction
|
14,297
|
|
|
15,288
|
|
|
15,965
|
|
|||
International
|
1,366
|
|
|
1,394
|
|
|
1,255
|
|
|||
Segment depreciation and amortization
|
21,074
|
|
|
22,810
|
|
|
24,980
|
|
|||
Shared Resources
|
4,031
|
|
|
4,058
|
|
|
3,558
|
|
|||
Total
|
$
|
25,105
|
|
|
$
|
26,868
|
|
|
$
|
28,538
|
|
Capital Expenditures
|
|
|
|
|
|
||||||
Agriculture
|
$
|
2,950
|
|
|
$
|
1,585
|
|
|
$
|
2,861
|
|
Construction
|
20,080
|
|
|
5,480
|
|
|
1,492
|
|
|||
International
|
1,332
|
|
|
898
|
|
|
657
|
|
|||
Segment capital expenditures
|
24,362
|
|
|
7,963
|
|
|
5,010
|
|
|||
Shared Resources
|
1,753
|
|
|
4,462
|
|
|
3,401
|
|
|||
Total
|
$
|
26,115
|
|
|
$
|
12,425
|
|
|
$
|
8,411
|
|
|
|
|
|
|
|
||||||
|
January 31, 2018
|
|
January 31, 2017
|
|
|
||||||
Total Assets
|
(in thousands)
|
|
|
||||||||
Agriculture
|
$
|
400,017
|
|
|
$
|
411,726
|
|
|
|
||
Construction
|
211,154
|
|
|
221,092
|
|
|
|
||||
International
|
126,251
|
|
|
106,899
|
|
|
|
||||
Segment assets
|
737,422
|
|
|
739,717
|
|
|
|
||||
Shared Resources
|
22,886
|
|
|
31,705
|
|
|
|
||||
Total
|
$
|
760,308
|
|
|
$
|
771,422
|
|
|
|
|
Revenue
|
|
Gross Profit
|
|
Net Income (Loss) Including Noncontrolling Interest
|
|
Net Income (Loss) Attributable to Titan Machinery Inc.
|
|
Earnings (Loss) per Share-Basic
|
|
Earnings (Loss) per Share-Diluted
|
||||||||||||
|
(in thousands, except per share data)
|
||||||||||||||||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
First quarter
|
$
|
264,118
|
|
|
$
|
48,919
|
|
|
$
|
(5,932
|
)
|
|
$
|
(5,932
|
)
|
|
$
|
(0.27
|
)
|
|
$
|
(0.27
|
)
|
Second quarter
|
268,871
|
|
|
52,807
|
|
|
(5,186
|
)
|
|
(5,186
|
)
|
|
(0.24
|
)
|
|
(0.24
|
)
|
||||||
Third quarter
|
330,341
|
|
|
61,477
|
|
|
2,384
|
|
|
2,384
|
|
|
0.11
|
|
|
0.11
|
|
||||||
Fourth quarter
|
339,608
|
|
|
52,097
|
|
|
1,685
|
|
|
1,685
|
|
|
0.08
|
|
|
0.08
|
|
||||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
First quarter
|
$
|
284,860
|
|
|
$
|
53,548
|
|
|
$
|
(3,858
|
)
|
|
$
|
(3,684
|
)
|
|
$
|
(0.17
|
)
|
|
$
|
(0.17
|
)
|
Second quarter
|
278,333
|
|
|
52,933
|
|
|
(2,702
|
)
|
|
(2,520
|
)
|
|
(0.12
|
)
|
|
(0.12
|
)
|
||||||
Third quarter
|
332,266
|
|
|
58,426
|
|
|
264
|
|
|
264
|
|
|
0.01
|
|
|
0.01
|
|
||||||
Fourth quarter
|
317,621
|
|
|
48,822
|
|
|
(8,239
|
)
|
|
(8,239
|
)
|
|
(0.38
|
)
|
|
(0.38
|
)
|
Classification
|
Beginning Balance
|
|
Additions Charged to Expenses
|
|
Deductions for Write-offs, Net of Recoveries
|
|
Foreign currency translation adjustment
|
|
Ending Balance
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Valuation reserve deduction from receivables:
|
|
|
|
|
|
|
|
|
|
||||||||||
Year ended January 31, 2018
|
$
|
3,630
|
|
|
$
|
2,333
|
|
|
$
|
(3,138
|
)
|
|
$
|
126
|
|
|
$
|
2,951
|
|
Year ended January 31, 2017
|
3,591
|
|
|
3,399
|
|
|
(3,428
|
)
|
|
68
|
|
|
3,630
|
|
|||||
Year ended January 31, 2016
|
4,218
|
|
|
3,896
|
|
|
(4,591
|
)
|
|
68
|
|
|
3,591
|
|
(a)
|
Documents filed as part of this report.
|
(1)
|
Financial Statements. The following financial statements are included in Part II, Item 8 of this Annual Report on Form 10-K:
|
(2)
|
Financial Statement Schedules. The following consolidated financial statement schedule should be read in conjunction with the consolidated financial statements and Report of Deloitte & Touche LLP on the consolidated financial statements included in Part II, Item 8 of this annual report on Form 10-K:
|
(3)
|
Exhibits. See the Exhibit Index to our Form 10-K immediately following below:
|
No.
|
|
Description
|
|
Certificate of Incorporation of the registrant, as amended (incorporated herein by reference to Exhibit 3.1 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on September 10, 2012).
|
|
|
|
|
|
Bylaws of the registrant, as amended (incorporated herein by reference to Exhibit 3.2 of the registrant's Annual Report on Form 10-K filed with the Commission on April 16, 2009 as File No. 001-33866).
|
|
|
|
|
|
Specimen Certificate representing shares of common stock of Titan Machinery Inc. (incorporated by reference to Exhibit 4.1 of the registrant's Amendment No. 6 to Registration Statement on Form S-1, Reg. No. 333-145526, filed with the Commission on December 3, 2007).
|
|
|
|
|
|
Indenture, dated as of April 24, 2012, by and between the registrant and Wells Fargo Bank, National Association, as Trustee (incorporated by reference to Exhibit 4.1 of the registrant's Current Report on Form 8-K filed with the Commission on April 24, 2012).
|
|
|
|
|
|
Amended and Restated Employment Agreement, dated March 6, 2013, between David Meyer and the registrant (incorporated herein by reference to Exhibit 10.2 of the registrant's Annual Report on Form 10-K filed with the Commission on April 10, 2013).**
|
|
|
Amendment dated March 1, 2014 to the Amended and Restated Employment Agreement, dated March 6, 2013, between David Meyer and the registrant (incorporated herein by reference to Exhibit 10.54 of the registrant's Annual Report on Form 10-K filed with the Commission on April 11, 2014).**
|
|
|
|
|
|
Amended and Restated Employment Agreement, dated September 4, 2015, between Mark Kalvoda and the registrant (incorporated herein by reference to Exhibit 10.3 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on September 9, 2015).**
|
|
|
Amendment dated September 1, 2016 to the Amended and Restated Employment Agreement, dated September 4, 2015 between Mark Kalvoda and the registrant (incorporated herein by reference to Exhibit 10.2 of the registrant’s Quarterly Report on Form 10-Q filed with the Commission on September 1, 2016).**
|
|
|
|
|
|
Agricultural Equipment Sales & Service Agreement, dated May 31, 2017, between CNH Industrial America LLC and the registrant (incorporated herein by reference to Exhibit 10.3 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on June 2, 2017).
|
|
|
|
|
|
Amendment to the Agricultural Equipment Sales & Service Agreement, dated May 31, 2017, between CNH Industrial America LLC and the registrant (incorporated herein by reference to Exhibit 10.4 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on June 2, 2017).
|
|
|
Construction Equipment Sales & Service Agreement, dated May 31, 2017, between CNH Industrial America LLC and the registrant (incorporated herein by reference to Exhibit 10.1 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on June 2, 2017).
|
|
|
|
|
|
Amendment to the Construction Equipment Sales & Service Agreement, dated May 31, 2017, between CNH Industrial America LLC and the registrant (incorporated herein by reference to Exhibit 10.2 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on June 2, 2017).
|
|
|
New Holland Equipment Sales & Service Agreement, dated May 31, 2017, between CNH Industrial America LLC and the registrant (incorporated herein by reference to Exhibit 10.5 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on June 2, 2017).
|
|
|
|
|
|
Amendment to the New Holland Equipment Sales & Service Agreement, dated May 31, 2017, between CNH Industrial America LLC and the registrant (incorporated herein by reference to Exhibit 10.6 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on June 2, 2017).
|
|
|
|
|
|
Dealer Security Agreement dated April 14, 2003 between New Holland North America, Inc. and the registrant (incorporated herein by reference to Exhibit 10.14 of the registrant's Amendment No. 2 to Registration Statement on Form S-1, Reg. No. 333-145526, filed with the Commission on October 10, 2007).
|
|
|
|
|
|
Dealer Security Agreements between CNH America LLC and the registrant (incorporated herein by reference to Exhibit 10.15 of the registrant's Amendment No. 2 to Registration Statement on Form S-1, Reg. No. 333-145526, filed with the Commission on October 10, 2007).
|
|
|
|
|
|
Amended and Restated Wholesale Floorplan Credit Facility and Security Agreement, dated November 13, 2007, between CNH Capital America LLC and the registrant (incorporated herein by reference to Exhibit 10.25 of the registrant's Amendment No. 5 to Registration Statement on Form S-1, Reg. No. 333-145526, filed with the Commission on November 27, 2007).
|
|
|
|
|
No.
|
|
Description
|
|
Letter Agreement with CNH Capital America, LLC dated September 30, 2011, amending the November 13, 2007 Amended and Restated Wholesale Floorplan Credit Facility and Security Agreement (incorporated herein by reference to Exhibit 10.3 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on December 9, 2011).
|
|
|
|
|
|
Letter Agreement with CNH Capital America, LLC dated November 20, 2012, amending the November 13, 2007 Amended and Restated Wholesale Floorplan Credit Facility and Security Agreement (incorporated herein by reference to Exhibit 10.1 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on December 6, 2012).
|
|
|
|
|
|
Letter Agreement with CNH Capital America, LLC dated February 15, 2013, amending the November 13, 2007 Amended and Restated Wholesale Floorplan Credit Facility and Security Agreement (incorporated herein by reference to Exhibit 10.49 of the registrant's Annual Report on Form 10-K filed with the Commission on April 10, 2013).
|
|
|
|
|
|
Amendment dated December 8, 2014 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 (incorporated herein by reference to Exhibit 10.2 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on December 10, 2014).
|
|
|
|
|
|
Second Amendment dated March 31, 2016 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 (incorporated herein by reference to Exhibit 10.17.5 of the registrant's Annual Report on Form 10-K filed with the Commission on April 13, 2016).
|
|
|
|
|
|
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 (incorporated herein by reference to Exhibit 10.2 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on December 7, 2017).
|
|
|
|
|
|
Amendment dated April 1, 2018 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.
|
|
|
|
|
|
Second Amended and Restated Credit Agreement dated as of October 28, 2015 by and among the registrant, Wells Fargo Bank, National Association, and the Financial Institutions Party Thereto (incorporated by reference to Exhibit 10.1 of the registrant's Current Report on Form 8-K filed with the Commission on November 2, 2015).
|
|
|
|
|
|
Amendment No. 1 to Second Amended and Restated Credit Agreement dated December 29, 2015 by and among the registrant, Wells Fargo Bank, National Association, and the Financial Institutions Party Thereto (incorporated herein by reference to Exhibit 10.18.1 of the registrant's Annual Report on Form 10-K filed with the Commission on April 13, 2016).
|
|
|
|
|
|
Amendment No. 2 to Second Amended and Restated Credit Agreement dated March 25, 2016 by and among the registrant, Wells Fargo Bank, National Association, and the Financial Institutions Party Thereto (incorporated herein by reference to Exhibit 10.18.2 of the registrant's Annual Report on Form 10-K filed with the Commission on April 13, 2016).
|
|
|
|
|
|
Amendment No. 3 to Second Amended and Restated Credit Agreement dated December 8, 2016 by and among the registrant, Wells Fargo Bank, National Association, and the Financial Institutions Party Thereto (incorporated herein by reference to Exhibit 10.17.3 of the registrant's Annual Report on Form 10-K filed with the Commission on April 7, 2017).
|
|
|
|
|
|
Amendment No. 4 to Second Amended and Restated Credit Agreement dated March 1, 2017 by and among the registrant, Wells Fargo Bank, National Association, and the Financial Institutions Party Thereto (incorporated herein by reference to Exhibit 10.17.4 of the registrant's Annual Report on Form 10-K filed with the Commission on April 7, 2017).
|
|
|
|
|
|
Amendment No. 5 to Second Amended and Restated Credit Agreement dated February 12, 2018 by and among the registrant, Wells Fargo Bank, National Association, and the Financial Institutions Party Thereto.
|
|
|
|
|
|
Amended and Restated 2005 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.1 of the registrant's Current Report on Form 8-K filed with the Commission on June 6, 2011).**
|
|
|
|
|
|
Form of Incentive Stock Option Agreement under the 2005 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.22 of the registrant's Amendment No. 2 to Registration Statement on Form S-1, Reg. No. 333-145526, filed with the Commission on October 10, 2007).**
|
|
|
|
|
No.
|
|
Description
|
|
Form of Non-Qualified Stock Option Agreement under the 2005 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.23 of the registrant's Amendment No. 2 to Registration Statement on Form S-1, Reg. No. 333-145526, filed with the Commission on October 10, 2007).**
|
|
|
|
|
|
Form of Restricted Stock Agreement under the 2005 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.24 of the registrant's Amendment No. 2 to Registration Statement on Form S-1, Reg. No. 333-145526, filed with the Commission on October 10, 2007).**
|
|
|
|
|
|
Titan Machinery Inc. 2014 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.1 of the registrant's Current Report on Form 8-K filed with the Commission on June 3, 2014).**
|
|
|
|
|
|
Form of Titan Machinery Inc. Performance Award Agreement under the 2014 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.1 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on June 5, 2014).**
|
|
|
|
|
|
Form of Titan Machinery Inc. Restricted Stock Agreement (for non-employee directors) under the 2014 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.2 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on June 5, 2014).**
|
|
|
|
|
|
Form of Titan Machinery Inc. Restricted Stock Agreement under the 2014 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.3 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on June 5, 2014).**
|
|
|
|
|
|
Form of Titan Machinery Inc. Restricted Stock Unit Agreement under the 2014 Equity Incentive Plan (incorporated herein by reference to Exhibit 10.2 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on September 9, 2014).**
|
|
|
|
|
|
Form of Director and Officer Indemnification Agreement (incorporated by reference to Exhibit 10.34 of the registrant's Annual Report on Form 10-K filed with the Commission on April 11, 2012).
|
|
|
|
|
|
Titan Machinery Inc. Non-Employee Director Compensation Plan (incorporated herein by reference to Exhibit 10.2 of the registrant's Quarterly Report on Form 10-Q filed with the Commission on September 9, 2015).**
|
|
|
|
|
|
Description of Titan Machinery Inc.’s Executive Cash Bonus Plan (incorporated herein by reference to Exhibit 10.34 of the registrant’s Annual Report on Form 10-K filed with the Commission on April 15, 2015**
|
|
|
|
|
|
Subsidiaries of Titan Machinery Inc.
|
|
|
|
|
|
Consent of Deloitte & Touche LLP
|
|
|
|
|
|
Power of Attorney
|
|
|
|
|
|
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
|
|
The following materials from Titan Machinery Inc.'s Annual Report on Form 10-K for the year ended January 31, 2018, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Statements of Operations for the fiscal years ended January 31, 2018, 2017 and 2016, (ii) the Consolidated Statements of Operations for the fiscal years ended January 31, 2018, 2017 and 2016, (iii) the Consolidated Statements of Comprehensive Income (Loss) for the fiscal years ended January 31, 2018, 2017 and 2016, (iv) the Consolidated Statements of Stockholders' Equity for the fiscal years ended January 31, 2018, 2017 and 2016, (v) the Consolidated Statements of Cash Flows for the fiscal years ended January 31, 2018, 2017 and 2016, and (vi) the Notes to the Consolidated Financial Statements.
|
*
|
Filed herewith
|
**
|
Indicates management contract or compensatory plan or arrangement.
|
By
|
|
/s/ DAVID J. MEYER
|
|
By
|
|
/s/ MARK KALVODA
|
|
|
David J. Meyer,
Board Chair and Chief Executive Officer
|
|
|
|
Mark Kalvoda,
Chief Financial Officer
|
Signature
|
Title
|
Date
|
|
/s/ DAVID J. MEYER
|
Board Chair, Chief Executive Officer (principal executive officer)
|
|
April 6, 2018
|
David J. Meyer
|
|
|
|
|
|
|
|
/s/ MARK KALVODA
|
Chief Financial Officer (principal financial officer and principal accounting officer)
|
|
April 6, 2018
|
Mark Kalvoda
|
|
|
|
|
|
|
|
*
|
Director
|
|
|
Tony Christianson
|
|
|
April 6, 2018
|
|
|
|
|
*
|
Director
|
|
|
Stanley Dardis
|
|
|
April 6, 2018
|
|
|
|
|
*
|
Director
|
|
|
Stan Erickson
|
|
|
April 6, 2018
|
|
|
|
|
*
|
Director
|
|
|
Christine Hamilton
|
|
|
April 6, 2018
|
|
|
|
|
*
|
Director
|
|
|
John Henderson
|
|
|
April 6, 2018
|
|
|
|
|
*
|
Director
|
|
|
Jody Horner
|
|
|
April 6, 2018
|
|
|
|
|
*
|
Director
|
|
|
Richard Mack
|
|
|
April 6, 2018
|
*By
|
|
/s/ MARK KALVODA
|
|
|
|
Mark Kalvoda, Attorney-in-Fact
|
|
(i)
|
such Lender's Revolver Commitment, or
|
(i)
|
such Lender's Floorplan Commitment, or
|
Level
|
Average Adjusted
Excess Availability
|
Applicable Margin Relative to Base Rate Loans (the "
Base Rate Margin
")
|
Applicable Margin Relative to LIBOR Rate Loans (the "
LIBOR Rate
Margin
")
|
I
|
>
$150,000,000
|
0.75%
|
1.75%
|
II
|
< $150,000,000 and
>
$100,000,000
|
1.00%
|
2.00%
|
III
|
< $100,000,000 and
>
$50,000,000
|
1.25%
|
2.25%
|
IV
|
< $50,000,000
|
1.50%
|
2.50%
|
|
(c) copies of invoices together with corresponding shipping and delivery documents, and credit memos together with corresponding supporting documentation, with respect to invoices and credit memos in excess of an amount determined in the sole discretion of Agent, from time to time.
(d) Inventory system/perpetual reports specifying the cost (defined to be the lower or cost or market) of Borrower's and the other Loan Parties' Inventory, by category, with additional detail showing additions to and deletions therefrom (delivered electronically in an acceptable format, if Borrower has implemented electronic reporting).
(e) an executed Aggregate Borrowing Base Certificate, Floorplan Borrowing Base Certificate and Revolver Borrowing Base Certificate,
(f) a detailed aging, by total, of the Loan Parties' Accounts, together with a reconciliation and supporting documentation for any reconciling items noted (delivered electronically in an acceptable format, if Borrower has implemented electronic reporting),
(g) a detailed calculation of those Accounts that are not eligible for the Borrowing Base, if Borrower has not implemented electronic reporting.
(h) a detailed Inventory system/perpetual report together with a reconciliation to Borrower's general ledger accounts and its monthly financial statements including any book reserves related thereto (delivered electronically in an acceptable format, if Borrower has implemented electronic reporting),
(i) a detailed calculation of Inventory categories that are not eligible for the Borrowing Base, if Borrower has not implemented electronic reporting,
(j) a summary aging, by vendor, of Borrower's and the other Loan Parties' accounts payable and any book overdraft (delivered electronically in an acceptable format, if Borrower has implemented electronic reporting) and an aging, by vendor, of any held checks,
(k) a detailed report regarding Borrower's and its Subsidiaries' cash and Cash Equivalents,
(l) a reconciliation of trade accounts payable of Borrower's general ledger accounts to its monthly financial statements including any book reserves related thereto.
(m) copies of the current borrowing base certificate and supporting schedules for the Agricredit Floorplan Indebtedness and a list identifying all Inventory of Borrower and its Subsidiaries against which Agricredit has made advances, and
(n) copies of the current borrowing base certificate and supporting schedules for the CNH Floorplan Indebtedness and a list identifying all Inventory of Borrower and its Subsidiaries against which CNH has made advances, all Inventory and its Subsidiaries that has become "Paid in Full" and the outstanding amount of the "CNH Parts Debt".
|
(b)
|
no Default or Event of Default shall have occurred and be continuing.
|
(b)
|
no Default or Event of Default has occurred and is continuing; and
|
8.
|
Miscellaneous
.
|
Name
|
|
Ownership
|
|
Jurisdiction of
Incorporation/
Organization
|
NW Property Solutions LLC
|
|
100%
|
|
North Dakota
|
Titan European Holdings S.a.r.l.
|
|
100%
|
|
Luxembourg
|
Titan Machinery Ukraine LLC
|
|
100%
|
|
Ukraine
|
Titan Machinery D.o.o. Novi Sad
|
|
100%
|
|
Serbia
|
Titan Machinery Austria GmbH
|
|
100%
|
|
Austria
|
Titan Machinery Romania S.R.L.
|
|
100%
|
|
Romania
|
Titan Machinery Bulgaria AD
|
|
100%
|
|
Bulgaria
|
|
/s/ David J. Meyer
David J. Meyer, Board Chair and CEO
|
/s/ Mark Kalvoda
Mark P. Kalvoda, CFO
|
/s/ Tony Christianson
Tony Christianson, Director
|
/s/ Stanley Dardis
Stanley Dardis, Director
|
/s/ Stan Erickson
Stan Erickson, Director
|
/s/ Christine Hamilton
Christine Hamilton, Director
|
/s/ John Henderson
John Henderson, Director
|
/s/ Jody Horner
Jody Horner, Director
|
/s/ Richard Mack
Richard Mack, Director
|
|
1.
|
I have reviewed this report on Form 10-K 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;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(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
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors:
|
(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
|
1.
|
I have reviewed this report on Form 10-K 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;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(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
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors:
|
(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
|