Titan Group reports net profit in 1H14 following three consecutive semesters of losses

Byrebecca3360

Updated Mon, 04 Aug 2014 14:39:18 GMT

Financial results

The Titan Group posted a turnover of €571.2 million in 1H14, a 3.9% increase on the corresponding period in 2013. EBITDA improved by 0.8% to reach €89 million. At stable exchange rates, turnover would have risen by 7% and operating profitability by 4%. Net profit after taxes and minorities came in at €2.9 million. In 1H13, this figure was a €21.8 million loss. The improved net profit marks the first positive result for the Group following three consecutive semesters of losses.

Net debt totalled €490 million at the end of 1H14, this is €19 million less than at the close of 2H13 and €62 million less than at the end of 1H13.

In 2Q14, net profit after taxes and minority interest reached €13.9 million, up 164.2% on 2Q13’s €5.3 million. Turnover and pre-tax profits grew by 1.5% and 46.9%, respectively. However, EBITDA for the second quarter fell by 9.9% to €58.5 million.

1H14 regional results

Greece and Western Europe

Turnover for this area totalled €148 million, up 22%, while EBITDA grew from €9 million in 1H13 to €16 million in 1H14. Although cement demand in Greece began to show very slight improvement, sales are still heavily dependent on exports. The company’s efforts to lower energy costs and reduce the environmental footprint of its plants in Greece helped it to remain competitive in export markets. In 2014, cement consumption in Greece is expected to rise for the first time in seven years as a result of infrastructure projects. However, according to the Group, residential construction growth prospects ‘are modest at best’.

Southeastern Europe

Mild weather at the beginning of the year helped to somewhat offset low construction activity levels in 2Q14. In the first six months of 2014, turnover grew by 3% to €102 million and EBITDA was up 30% to €30 million, aided by enhanced energy efficiency.

USA

Greater volumes and higher prices helped EBITDA to improve by €8 million and turnover to rise by 14%. Although harsh weather conditions affected results at the start of 2014, the construction industry continues to strengthen. Improvements in the housing market in Florida are helping to drive demand for construction materials.

Eastern Mediterranean

Turnover declined by 26% to €101 million while EBITDA dropped 46% to €25 million. In Egypt, the Group’s operations were hit by gas supply shortages and permitting delays for solid fuel utilisation. Titan imported clinker to help meet cement demand in the country and it continues to invest in solid and secondary fuel use. In Turkey cement demand remained strong.

Titan Cement S.A.

Titan Group’s parent company, Titan Cement S.A., has reported a 13% increase in turnover for 1H14. EBITDA grew from €7 million in 1H13 to €12 million this year. Titan Cement S.A. received €20 million in the form of dividends from overseas subsidiaries, which enabled it to increase its net profit from a loss of €22 million to a profit of €8 million in 1H14.