Titan - September 2019
In the first half of 2019, Titan Group recorded growth in sales revenue in all regions, with the exception of the eastern Mediterranean sales region. Consolidated turnover for the group reached EUR785.4m, up 10.2 per cent on the 1H18. This is attributed to the strong performance of the US market, growth in demand in southeastern Europe, and a modest recovery of sales in the group’s Greek operations.
EBITDA remained flat YoY at E122.2m as the persistent challenging conditions in both Egypt and Turkey caused a decline in revenues and an EBITDA drop that offset the other regions’ improved operational profitability. Net profit after minority interests and taxes was EUR13.3m, compared to EUR24.8m in the 1H18, due to the strength of the US dollar causing US$5m in foreign exchange hedging costs and higher depreciation costs.
Activity in the USA continued strongly, with higher demand for building materials, compared to the previous year. This led to volume and revenue growth across all products, except fly ash, with the US turnover advancing by 13.9 per cent YoY in the 1H19, reaching EUR471.8m. In Greece the domestic market recorded a modest increase in volumes with demand rising on the back of tourism-related projects and a higher level of private sector consumption. Total turnover for Greece and western Europe in the 1H19 increased by 7.6 per cent YoY to EUR123.3m.
In the growing economies of southeastern Europe, construction activity and demand for building materials continued to rise, along with improved prices. Turnover here posted a 17.1 per cent increase YoY in the 1H19 to EUR120.7m. In the Eastern Mediterranean region, market conditions remained challenging. In Egypt, domestic demand shrank by approximately five per cent in the first half of 2019. Meanwhile, in Turkey demand continued to decline rapidly and is expected to record a 30 per cent contraction YoY by the end of the year. Although prices increased in local currency, this was not sufficient to cover inflation and the weakening of the Turkish lira. Total turnover for eastern Mediterranean reached EUR69.7m in the 1H19, a 13.5 per cent YoY decline.
Despite record wet weather in Brazil, cement volumes there remained stable, while revenue for the 1H19 advanced by seven per cent YoY.
Looking ahead to the 2H19, the group’s outlook is favourable for most of the markets in which is operates. There is good potential for further demand growth in the US, more dynamic growth expected in southeastern Europe, and positive forecasts for both Greece and Brazil. However, conditions in the near term are expected to remain challenging in Egypt and Turkey.