Titan International (NYSE: TWI) reported Q1 EPS of $0.02, $0.14 worse than the analyst estimate of $0.16. Revenue for the quarter came in at $410.4 million versus the consensus estimate of $429.17 million.

"The first quarter of 2019 was certainly not the start to the year we had planned,\" commented Paul Reitz, President and Chief Executive Officer. \"There were a number of factors that negatively influenced our sales and gross profit with a significant impact from currency headwinds, primarily in Europe and Brazil. Many companies have discussed the impact of the strong dollar, but for a company our size the impact was significant at $25 million on the sales line and approximately $2.5 million at the gross profit line as compared to last year. The overall Ag economy, driven by continued lower commodity prices and ongoing trade concerns have pushed U.S. farmer sentiment lower. This sentiment shift, coupled with a delayed planting season in the Midwest from adverse weather conditions, further impacted our original expectations for aftermarket demand during the quarter. We still believe, like many others in the industry, that the Ag market has a strong level of pent-up demand as evidenced by aging fleets and large equipment sales remaining well below historical averages. We did experience better overall financial performance in March, which is encouraging heading into the second quarter and the remainder of the year.

"As we look more specifically at the pockets of our business that experienced the largest gross profit impacts, our North America tire business unit had temporary margin pressure as we implemented focused incentives to drive aftermarket sales during the sluggish start to the year in order to protect market share. In addition, North America tire was impacted in the short-term by higher costs of inventory from production in the fourth quarter when we were at lower volume levels. We continue to be encouraged by the continued adoption and growth of our LSW® technology. With wet conditions currently in much of the Midwest, we have seen added demand for our market-leading LSW assemblies. In Brazil, farm exports are a successful part of our business, but the broader economic problems within Argentina and Columbia hurt our export sales this period, while the Brazilian and Mexican consumer segment light truck business also experienced some decline. In Russia, tire inventory levels at dealers remain very high, and that, combined with capital markets that are at a standstill, has severely weakened the impact of incentive programs and our ability to drive sales at this time.

"The Titan team has done a good job implementing changes to our Company as shown by the improvement in our operating results over the last few years. While we did not come out of the gate as strong to start this year, we remain cautiously optimistic about 2019 while we take the steps necessary to manage the business appropriately, as we progress through the year. At this time, we reiterate the previously specified outlook for 2019.

"On February 26th, we announced that we were evaluating strategic alternatives with respect to ITM, our undercarriage business. We have engaged Shore Capital as our financial advisor to assist us in carrying out this evaluation. With respect to one of the potential alternatives, a public listing within Europe, we continue to make positive progress as we move through the diligence phase of this alternative. Our original goal of this strategic evaluation, maximizing value for our stakeholders, remains on track and we are pleased with the progress that has been made to date.

"This week, Titan's board of directors authorized management to proceed with upsizing our U.S. based credit facility from the current level up to $125 million. Within the next few weeks, we expect to execute this increase in the facility as each of our banking partners have already confirmed their increased commitments."

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