QUINCY, Ill. (Nov. 12, 2002) — Tire and wheel maker Titan International Inc. reported a net loss of $17.7 million during the third quarter, more than half coming from a write-off on its investment in a Uruguayan tire and rubber company.
The Quincy-based firm took a reserve of $9.5 million on its investment in Fabrica Uruguya de Neumaticos S.A. in the third quarter. The economic instability in Uruguay — marked by the temporary closing of its banks and labor strife — helped Titan make the decision to clear its books at Funsa.
The Titan-controlled tire side of the operation currently is idle, but Funsa continues to make other rubber products, said Maurice Taylor Jr., Titan CEO and president.
Mr. Taylor said if conditions improve in Uruguay, the company will attempt to salvage the business.
Titan purchased 81 percent of Funsa´s public stock in June 1998.
Titan´s loss for the third quarter was nearly double that of the like period in 2001, when it was $9.5 million in the red. The company had net sales of $104.7 million during the third quarter, up 4.1 percent from the like period in 2001.
For the first nine months of 2002, Titan reported a net loss of $20.1 million on sales of $354.2 million, compared to a net loss of $13.3 million on sales of $356.9 million in 2001.
Losses from operations for the quarter totaled $7.8 million, Titan said. The firm pointed to extended summer shutdowns of its original equipment customers, its own two-week maintenance closing and rising material costs as factors for its inability to offset the operating losses.
Titan management´s overall goals are to increase sales, return earnings before income taxes to 1997 levels — before the union strikes at Titan plants in Des Moines, Iowa, and Natchez, Miss., began — and reduce debt, Mr. Taylor said.