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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


 
FORM 10-Q
  

þ
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For Quarterly Period Ended: March 31, 2005

OR

o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 1-12936

TITAN INTERNATIONAL, INC.

(Exact name of Registrant as specified in its Charter)
Illinois
  
36-3228472
(State of Incorporation)
  
(I.R.S. Employer Identification No.)

2701 Spruce Street, Quincy, IL 62301
(Address of principal executive offices, including Zip Code)

(217) 228-6011
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
Yes þ No o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).
Yes þ No o

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

   
Shares Outstanding at
Class
  
April 26, 2005
     
Common stock, no par value per share
  
16,369,104




TITAN INTERNATIONAL, INC.

TABLE OF CONTENTS




   
Page
Part I.
Financial Information
  
     
Item 1.
Financial Statements (Unaudited)
  
     
 
Consolidated Condensed Statements of Operations
for the Three Months Ended March 31, 2005 and 2004
1
     
 
Consolidated Condensed Balance Sheets as of
March 31, 2005, and December 31, 2004
2
     
 
Consolidated Condensed Statements of Cash Flows
for the Three Months Ended March 31, 2005 and 2004
3
     
 
Notes to Consolidated Condensed Financial Statements
4-12
     
Item 2.
Management’s Discussion and Analysis of
Financial Condition and Results of Operations
13-23
     
Item 3.
Quantitative and Qualitative Disclosures About Market Risk
24
     
Item 4.
Controls and Procedures
24
     
Part II.
Other Information
  
     
Item 6.
Exhibits
25
     
 
Signatures
26
     
     
     
     
     
     









PART I. FINANCIAL INFORMATION
 
Item 1. Financial Statements
TITAN INTERNATIONAL, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)
(Amounts in thousands, except earnings per share data)
 
 
Three months ended 
 
March 31, 
     
2005
    
2004
  
               
Net sales
  
$
136,129
  
$
166,976
  
Cost of sales
    
112,048
    
139,683
  
      Gross profit
    
24,081
    
27,293
  
Selling, general & administrative expenses
    
8,427
    
11,712
  
Research and development expenses
    
183
    
822
  
Idled assets marketed for sale depreciation
    
1,346
    
0
  
Goodwill impairment on Titan Europe
    
0
    
2,988
  
     Income from operations
    
14,125
    
11,771
  
Interest expense
    
(2,589
)
  
(5,150
)
Equity income from unconsolidated affiliate
    
1,192
    
0
  
Other (expense) income
    
(282
)
  
46
  
    Income before income taxes
    
12,446
    
6,667
  
Provision for income taxes
    
1,245
    
1,391
  
Net income
  
$
11,201
  
$
5,276
  
 
Income per common share:
              
Basic
  
$
.68
  
$
.25
  
Diluted
    
.51
    
.25
  
 
Average common shares outstanding:
              
Basic
    
16,352
    
21,197
  
Diluted
    
25,071
    
21,197
  







See accompanying Notes to Consolidated Condensed Financial Statements.

1

TITAN INTERNATIONAL, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED)
(Amounts in thousands, except share data)

   
March 31,
  
December 31,
  
Assets
  
 2005
  
2004
  
Current assets
              
Cash and cash equivalents
  
$
1,245
  
$
1,130
  
Accounts receivable (net allowance of $4,689 and $4,259, respectively)
    
73,244
    
52,781
  
Inventories
    
84,507
    
84,658
  
Deferred income taxes
    
6,711
    
6,711
  
Prepaid and other current assets
    
8,462
    
9,388
  
Total current assets
    
174,169
    
154,668
  
               
Property, plant and equipment, net
    
77,736
    
80,644
  
Idled assets marketed for sale
    
29,833
    
31,245
  
Investment in unconsolidated affiliate
    
30,484
    
30,040
  
Restricted cash deposits
    
24,500
    
24,500
  
Goodwill
    
11,702
    
11,702
  
Other assets
    
20,578
    
21,367
  
               
Total assets
  
$
369,002
  
$
354,166
  
               
Liabilities and Stockholders’ Equity
              
Current liabilities
              
Short-term debt (including current portion of long-term debt)
  
$
199
  
$
217
  
Accounts payable
    
34,182
    
26,733
  
Other current liabilities
    
16,537
    
12,820
  
Total current liabilities
    
50,918
    
39,770
  
               
Long-term debt
    
163,247
    
169,688
  
Deferred income taxes
    
9,164
    
9,164
  
Other long-term liabilities
    
27,977
    
28,663
  
Total liabilities
    
251,306
    
247,285
  
               
Stockholders’ equity
              
Common stock (no par, 60,000,000 shares authorized, 27,555,081 issued)
    
27
    
27
  
Additional paid-in capital
    
203,360
    
203,239
  
Retained earnings
    
32,504
    
21,385
  
Treasury stock (at cost, 11,192,655 and 11,228,655 shares, respectively)
    
(100,881
)
  
(101,204
)
Accumulated other comprehensive loss
    
(17,314
)
  
(16,566
)
Total stockholders’ equity