Titan's US business continues to advance strongly
Titan's first-half turnover improved by 19.9 per cent to EUR672.8m, helped by exchange rate movements, and EBITDA was ahead by 18.3 per cent to EUR105.3m. Following an increase in the depreciation charge of a modest 6.3 per cent, the trading profit improved by 35.4 per cent to EUR48.6m. After a net financial charge 10.1 per cent higher at EUR32.7m and other items, the pretax profit jumped from EUR6.7m to EUR30.9m. At the net attributable level the profit jumped from EUR2.9m profit to EUR24.2m. Capital investment was increased by a further 185.7 per cent to EUR82m, after several years of very low levels of spending until last year. Net debt at the end of June was increased by 28.6 per cent to EUR630m to give a gearing level of 40.8 per cent.
Group deliveries of cementitious materials declined by 1.2 per cent to 8Mt and aggregates shipments were down by 5.5 per cent to 6.9Mt, but ready-mixed concrete deliveries improved by 13.3 per cent to 2.13Mm³.
The Greek and western European turnover improved by 4.3 per cent to EUR146.7m and EBITDA advanced by 76.1 per cent to EUR28m. Greek domestic deliveries will be hit by lower volumes in the second half and profitability will suffer as domestic sales generate a higher margin. First-half margins saw the benefit of cost savings and higher effective export prices thanks to a weaker euro. The high level of capacity utilisation is expected to become even more dependent on securing export contracts. In Greece bad debt provisions remain considerable.
In southeastern Europe, turnover declined by 8.5 per cent to EUR90.9m and EBITDA came off by 16.6 per cent to EUR25.2m. After a winter of adverse weather conditions, domestic deliveries recovered across all markets during the second quarter, but economic growth across the region remains weak and capacity utilisation is poor, which leads to intensified competition.
The United States improvement continues to gather pace and, helped additionally by a stronger dollar, turnover rose by 42.5 per cent to EUR313.7m. EBITDA jumped 130.1 per cent to EUR42.1m on top of the 77.7 per cent advance registered this time last year. Florida remains Titan’s strongest market, where ready-mixed concrete deliveries were particularly robust on the back of the growth in housebuilding. Prices are ahead in all of Titan’s markets and across the whole product range. Only sales of fly ash are suffering because of supply constraints. The strength of demand is leading to the investment in additional ready-mixed concrete batching plants.
The eastern Mediterranean operations, of which only Egypt remains consolidated, saw turnover recover by 20.6 per cent to EUR121.6m, but EBITDA fell by a further 59.3 per cent to EUR10m. The investment to reduce the dependence on gas has run into a number of delays. The first of the two coal mills for Beni Suef has now been delivered after some delays. The second is to follow and then there will be a coal mill built at Alexandria. At present pulverised petcoke is being supplied to Alexandria from Titan in Greece. The Turkish joint venture generated a turnover of EUR42m and a EUR3m profit in the period.
