Greece-based global materials supplier
Group net profit after minority interests and the provision for taxes reached €53.8m in 2018, compared with €42.7m in 2017.
in 2018, the USA was the main profit generator for the group. Titan says that economic and population growth rates in the regions where the group is active have resulted in an increase in demand for both residential and commercial real estate, against a backdrop of increased infrastructure needs as well, which is over and above the country’s average growth rates as a whole.
In 2018, the improvement in results recorded in Florida, counterbalanced the lower profitability of the mid-Atlantic region which was affected by protracted inclement weather and an increase in competition in the broader New York area. In US$-terms, turnover in the USA increased by 3% crossing the US$1bn threshold (US$1,015m) and EBITDA was stable.
Titan said that 2018 was characterised by a stable, solid performance for the group. It added that it navigated successfully the challenges of subdued demand and margin pressure in several regions and capitalised on the opportunities markets such as the US continue to offer.
Group consolidated turnover for 2018 stood at €1,490.1m, recording a marginal 1% decline compared to 2017, while EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization) declined by 5% to €259.7m.
In the fourth quarter of 2018 the group recorded an increase across all operating performance indicators, as the improvement in performance which began to take place half-way through the year, continued. All Group regions recorded an improvement in results against the last quarter of 2017, with the exception of the Eastern Mediterranean. Total Group turnover increased by 7.5% reaching €388.2m and EBITDA increased by 6.6% to €62.8m. Group Net Profit after minority interests and the provision for taxes reached €3.6m, against €9.6m in 2017.
Building activity in Greece remained at very low levels in 2018. The timetable for the start of several major projects slipped into the following year. Demand exhibited some positive trends in regions with tourism development; on the whole, however, private building activity remained subdued. Operating margins came under pressure throughout 2018, due to increased energy costs which could not be carried over onto the market. Cement exports were close to 2017 levels, with the USA being the main destination. Total turnover for region Greece and Western Europe in 2018 reached €237.1m, a 4.7% decline compared to 2017. EBITDA stood at €10.9m versus €18.3m in 2017, €7.4m below the previous year.
Southeastern Europe markets recorded an increase in building activity and an improvement in results in the context of the mild economic upturn experienced by the region in recent years. Turnover for the region in 2018 increased by 5.7% reaching €238.6m and EBITDA improved by 4.9% to reach €59.7m.
Operating results in the Eastern Mediterranean region, comprising of Egypt and Turkey, declined in 2018. Turnover reached €154.3m posting a 2.5% drop, while EBITDA stood at €11.4m, 13.8% lower compared to 2017.
In Egypt, cement consumption is estimated to have declined by about 6%. At the same time, a new 12 mt cement plant entered the market during Q2 2018, resulting in a considerable increase of supply over-capacity. The resulting decrease of capacity utilisation of Titan Cement Egypt, combined with the inability to pass on the steep increase in electricity costs and the imposition of additional levies per ton of cement produced, practically wiped out profitability.
Group activity in Turkey declined following the sharp contraction in construction activity in the second half of the year under the shadow of the Turkish economy’s recession. In addition, the 38% slide in value of the Turkish Lira against the Euro in the course of the year and the increase in the cost of energy further impacted results. The net result attributed to the group from Titan's subsidiary in Turkey for the period 1/1/2018 – 30/9/2018, was a loss of €2.9m against a €0.5m profit in 2017.
Group capex in 2018 stood at €119m, €4m less than in 2017. About half of that was directed to the US. The capex figure also includes €12m paid as a one-off retroactive license fee for the Beni Suef cement plant in Egypt.
Operating cash flow for the group stood at €148m, up by €30m compared to 2017, benefiting from the stabilisation of working capital requirements. Group net debt as at 31st December, 2018, stood at €772m, increased by €49m against net debt levels of 31st December, 2017.
