Titan's 2017 turnover remains stable at EUR1506m
Titan's 2017 consolidated turnover remained stable, at EUR1505.8m, a marginal 0.2 per cent decline compared to 2016. EBITDA reached EUR273.4m, a 1.9 per cent decrease.
Non-recurring events (staff redundancy programmes in Egypt and Greece and hurricane Irma in Florida) had a negative impact on EBITDA of about EUR1m, against EUR6.7m of such costs in 2016. Net profit after minorities and the provision for taxes was EUR42.7m, compared to EUR127.4m in 2016.
Annual results strengthened on the back of the US market. Titan America was well placed to benefit from the improving markets, supported by an extensive investment programme of about EUR240m. Total turnover in the US for 2017 increased by 9.9 per cent, reaching EUR873.2m while EBITDA advanced by 27.5 per cent to EUR185.1m.
In Greece building activity weakened further in 2017, following the completion of certain major public works projects in the first half of the year. Private building activity remained at extraordinarily low levels, despite increasing demand from the expanding tourism sector. Export volumes remained high, although the strengthening of the euro against the US dollar combined with the increased fuel prices, affected profitability margins. Total turnover in Greece and western Europe eached EUR48.7m, down 4.8 per cent YoY, while EBITDA fell 49.7 per cent to EUR18.3m.
In southeastern Europe building activity recovered and demand for building materials posted an increase. Operating margins were supported by larger volumes but negatively affected by higher fuel costs. Turnover in 2017 increased by 10.5 per cent and reached EUR225.7m. EBITDA edged up by 1.2 per cent to EUR56.9m.
Egypt was severely affected by the sharp devaluation of the Egyptian pound in late 2016. Cement demand declined by 4.7 per cent compared to 2016. Turnover in the eastern Mediterranean region in 2017 declined by 36.5 per cent to EUR158.2m, while EBITDA at EUR13.2m posted a 67.8 per cent drop compared to the previous year.
The group's joint venture in Brazil in 2017 saw cement demand fall, albeit at a softer pace, while there was an increase in prices in the 2H17. Net results of our subsidiary attributable to the group was a EUR9.5m loss in 2017.
In Turkey increased competition following the entry into operation of two new plants in the vicinity of Adocim limited the scope of sales increases while production costs were affected by higher fuel prices. The devaluation of the Turkish lira, further impacted the profitability of the joint venture. Net profit of the Turkish subsidiary amounted to EUR0.5m in 2017, versus EUR3.6m in 2016.
4Q17
In the fourth quarter of 2017, consolidated turnover reached EUR361.3m, recording a 6.1 per cent decline. EBITDA reached EUR58.9m, posting a 19.9 per cent decline against the comparatively strong 4Q16. Net profit after minorities and the provision for taxes was EUR9.6m. As with the full-year results, the sharp devaluation of the Egyptian pound and the weakening of the US dollar negatively affected the reported figures.
Outlook
The outlook for the group in 2018 appears broadly positive, with the US market remaining the main engine of growth and profitability, despite headwinds in Egypt and Greece, claims Titan. The US market will be the strongest for the company as housing and infrastructure spending is rising in the US states where Titan has a footprint. Greek production in 2018 will once again be largely directed towards exports, says Titan. In Turkey demand should continue growing into 2018, spurred by major public investments and public-private partnership projects. In Brazil the improvement witnessed in key macroeconomic indicators and the anticipated stronger economic growth in 2018.
