Titan suffers in Egypt, but improves elsewhere

Titan’s turnover improved by 3.3 per cent to EUR879.7m in the first nine months of 2013, but EBITDA edged ahead by just 0.1 per cent to EUR146.7m. In the third quarter the EBITDA did decline by one per cent.

The trading profit for the nine months was 0.7 per cent lower at EUR57.9m and, after a 6.9 per cent reduction in net financial charges and a positive contribution from associates of EUR3.6m, there was a pre-tax profit of EUR47.4m profit compared with a EUR1.1m loss. There was a net attributable profit of EUR30.5m compared with a loss of EUR14.6m a year earlier.

Shipments of cementitious materials declined by 6.9 per cent in the nine months to 12.2Mt, while aggregates sales, now primarily in the United States, increased by around 18 per cent to 10.8Mt. Deliveries of ready-mixed concrete improved by 15 per cent to 2.91Mm³. 

The Greek and western European turnover increased by 16.6 per cent to EUR220.8m, or 25.1 per cent of the group total and EBITDA jumped 131.5 per cent to EUR29.4m, or 20 per cent of the group total, compared with just 8.1 per cent a year ago. Domestic deliveries improved thanks to increased civil engineering activity, but both the residential and commercial building sectors remain depressed. This is comes as a relief for the group following seven successive years of declining Greek cement consumption. Domestic pricing, however, remains under continued pressure, while cost efficiencies and reduced energy costs contributed to the margin improvement.

Southeastern Europe represented 19 per cent of turnover and 36.2 per cent of EBITDA. Turnover improved 1.5 per cent to EUR166.9m and EBITDA was ahead by 9.7 per cent to EUR53.1m, and is now the largest profit earner in the group. Domestic cement deliveries across the region, however, were broadly unchanged in tonnage terms and capacity utilisation remained unsatisfactory.

The US turnover advanced by a further 12.9 per cent to EUR345.4m, or 39.3 per cent of the group total. EBITDA increased 37.2 per cent to EUR31.7m, which represents 21.6 per cent of the group total. The improvement was particularly notable in Florida – Titan’s biggest US market representing around half of its assets – where cement consumption was reportedly ahead by some 21 per cent compared with a US average of 7.6 per cent.

In the eastern Mediterranean region, where just Egypt remains fully consolidated, turnover declined by 23.8 per cent to EUR146.6m, or 16.7 per cent of the group total compared with 25.7 per cent a year ago. EBITDA fell 47.9 per cent to EUR32.8m and its share of the group’s profit dropped from 45.4 per cent to 22.2 per cent. The severe fuel shortage has had a very damaging effect on production and led to clinker imports to supply some customer needs. The solid fuel investment at Beni Suef should be completed by the end of the year.