Greek Titan Cement 2008 net falls 13 pct

Byswb

Updated Wed, 25 Feb 2009 00:00:00 GMT

Greek cement maker Titan (TTNr.AT) said on Tuesday net profit fell 13 percent to 208 million euros ($266.5 million) last year on a sharply lower demand for building materials in the United States and Greece.

The housing crisis in the United States, which accounts for about one third of Titan's total sales, and a double-digit percentage drop in Greek building activity last year is hurting sales.

Titan said it planned to cut costs and reduce debt to brace for a further decline in U.S. and Greek cement demand this year.

"Our priorities for 2009 focus on generating free cash flows for the reduction of debt, on cutting costs and general and administrative expenses," Titan said in a statement.

Group sales rose 5 percent to 1.57 billion euros, as acquisitions in Turkey and Egypt last year boosted capacity.

It said it would propose a dividend of 0.42 euros per share, down 44 percent year-on-year, in a bid to retain liquidity in a challenging year.

Titan said a new unit in Albania and a second production line at its Egyptian plant will further strengthen sales as of 2010.

Apart from Greece and the United States, Titan also has operations in Egypt, Bulgaria and Serbia. At home it competes with Heracles (HERr.AT), majority owned by France's Lafarge (LAFP.PA).

Greek cement maker Titan (TTNr.AT) said on Tuesday net profit fell 13 percent to 208 million euros ($266.5 million) last year on a sharply lower demand for building materials in the United States and Greece.

The housing crisis in the United States, which accounts for about one third of Titan's total sales, and a double-digit percentage drop in Greek building activity last year is hurting sales.

Titan said it planned to cut costs and reduce debt to brace for a further decline in U.S. and Greek cement demand this year.

"Our priorities for 2009 focus on generating free cash flows for the reduction of debt, on cutting costs and general and administrative expenses," Titan said in a statement.

Group sales rose 5 percent to 1.57 billion euros, as acquisitions in Turkey and Egypt last year boosted capacity.

It said it would propose a dividend of 0.42 euros per share, down 44 percent year-on-year, in a bid to retain liquidity in a challenging year.

Titan said a new unit in Albania and a second production line at its Egyptian plant will further strengthen sales as of 2010.

Apart from Greece and the United States, Titan also has operations in Egypt, Bulgaria and Serbia. At home it competes with Heracles (HERr.AT), majority owned by France's Lafarge (LAFP.PA).

Titan trades about 6 times estimated 2008 earnings versus a multiple of 15 for European peers, according to Reuters Estimates. Analysts attribute the discount to concerns over Titan's exposure in the United States.

The stock, down 56 percent in the last 12 months, has underperformed the Athens bourse's general index .ATG which has lost 64 percent in the period.