Wet spring, weak construction drag Titan Machinery to loss
(Reuters) - Farm equipment retailer Titan Machinery Inc (TITN.O) said it expects to report a quarterly loss as demand was hit by a wet spring weather in the United States that delayed corn plantations, sending its shares down 12 percent in extended trade.
Titan gets almost 90 percent of its revenue from sales of farm equipment such as sprayers, hay and forage machinery, precision farming technology, tillage equipment and tractors.
Rival farm equipment maker Deere & Co (DE.N) also issued a cautious outlook for 2013 last week.
"The whole agriculture market has been sort of behind this year as the planting season has been delayed compared to the last several years, so business has been quite light to begin the year," Sidoti & Company LLC analyst Joseph Mondillo said.
Titan said it expects to report a loss of 1-3 cents per share for the first quarter, on revenue of about $440 million.
Analysts on average had expected earnings of 18 cents per share, on revenue of $478 million, according to Thomson Reuters I/B/E/S.
The company, which also sells heavy construction equipment and light industrial machinery, said a weak U.S. construction market and the cost of expansion also dragged on results.
The U.S. construction market has slowed in recent months after unseasonably warm weather last year and signs of an economic recovery prompted many customers to place orders for new machines.
A weak first quarter also pushed the company to cut its full-year earnings forecast to $1.70-$2.00 per share from $2.00-$2.30 per share. Analysts were expecting earnings of $2.15 per share.
Titan's shares were down 12 percent at $19.70 in trading after the bell. The company is scheduled to report first-quarter results on June 6.
(Editing by Saumyadeb Chakrabarty and Supantha Mukherjee)