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Titan Group 2018 Results

Date: 2019-09-01

Full Year 2018 Results

2018 was characterised by a stable, solid performance for TITAN. The Group navigated successfully the challenges of subdued demand and margin pressure in several regions and capitalized on the opportunities markets such as the US continue to offer. At the same time, TITAN remained focused on the enduring objective of balanced, responsible and sustainable long-term growth, embracing change as an organization and innovating at an accelerated pace.

Group consolidated turnover for 2018 stood at €1,490.1m, recording a marginal 1% decline compared to 2017. Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) declined by 5% to €259.7m. Group Net Profit after minority interests and the provision for taxes reached €53.8m, posting a 26% increase compared to 2017.

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.

The Board of Directors intends to propose to the Annual General Meeting of shareholders, scheduled for 7th June, 2019, a dividend distribution of €0.15 per issued share versus the previous year’s dividend distribution of €0.05 per issued share. The exact amounts to be distributed per share will be adjusted upwards to include the amounts corresponding to company treasury shares.

€ M. 2018 2017 % CHANGE Q4:18 Q4:17 % CHANGE
TURNOVER 1,490.1 1,505.8 (1%) 388.2 361.3 7.5%
EBITDA 259.7 273.4 (5.0%) 62.8 58.9 6.6%
NET PROFIT * 53.8 42.7 26.2% 3.6 9.6 (62.3%)


Once again in 2018, the USA was the main profit generator for the Group. The economic and population growth rates characterising the regions in which 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. In Euro-terms, turnover stood at €860.1m, posting a 1.5% decrease and EBITDA reached €177.9m, recording a 3.9% decline compared to 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.

The markets of Southeastern Europe 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. Here too, however, results were penalized by increased energy costs, which were nevertheless partially mitigated thanks to the investments in the use of alternative fuels undertaken by the Group over the last few years. Turnover 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 utilization 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 our 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. It should be noted that results from the Group’s Turkish operations are accounted for with the equity method until 30/9/2018, while the final quarter of 2018 is fully consolidated.

Demand in Brazil exhibited gradually encouraging trends in the course of 2018. The market almost stabilised following four years of consecutive declines. Results at the Apodi JV improved both in terms of turnover and EBITDA. The net result attributed to the Group was a limited loss of €2.6m, against the €9.5m loss recorded in 2017.


Group capex in 2018 stood at €119m, €4m less than in 2017. About half of that was directed to the US. The above amount also includes €12m paid as a one-off retroactive license fee for the Beni Suef cement plant in Egypt.

Following the agreement which was completed in October 2018 between TITAN Group and Cem Sak Group, TITAN Group holds 75% of Adocim Cimento Beton Sanayi ve Ticaret A.S. (Adocim), which owns an integrated cement plant in Tokat – Turkey, with a production capacity of 1.5 million tons of cement and three ready-mix concrete units.

Group operating cash flow stood at €148m, increased 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.

In January 2018, TITAN Global Finance Plc. Completed the issuance of €100m of additional notes in connection with the reopening of the 2.375% notes of nominal value €250m it issued in November 2017, resulting in a total issue of €350m notes due in November 2024.

In November 2018, Standard & Poor’s renewed its outlook on the Group assigning TITAN a credit rating of “BB+” on a negative outlook.

The total number of treasury shares held by the Company on 31st December 2018 was 4,558,481 of which 4,361,171 were common shares and 197,310 were preferred shares. Voting rights held by the Company represented 5.66% of total voting rights.