made a bold move toward the end of last year when it bought a handful of construction-equipment dealerships amid the worst building bust in decades. It hasn't paid off -- not yet, at least.
The company, which operates a chain of heavy-equipment dealerships for the agricultural and (increasingly) the construction businesses in the Midwest and Great Plains, said its first-quarter profits tumbled 47% to $1.8 million, or 10 cents a share, missing analysts' expectations by three cents.
A year ago, Titan made $3.4 million, or 25 cents a share.
Weakness in the construction market was the culprit, the company said in its earnings release, but it made no apologies for its recent buying spree, arguing that the purchases will render it "well-positioned" once the housing and commercial real estate markets begin to rebound.
Titan, based in Fargo, N.D., added that its construction-equipment business will contribute 20% in revenue to its overall top line in the current fiscal year, up from 12% a year ago.
In December, Titan bought two companies based in Wyoming and Montana that operate a combined nine dealerships with total revenue of nearly $50 million in 2007.
Titan said first-quarter revenue rose 9% to $166 million, mostly on the back of those newly acquired businesses.
Looking ahead, the company reaffirmed its guidance for the year: EPS of 92 cents to $1.04, on revenue of $750 million to $790 million.
Shares of the company were trading slightly higher Tuesday afternoon, at $15.12, up 8 cents, on volume of 2 million shares. The average daily turnover of the stock is 300,000.
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