Titan’s turnover for the first nine months declined by 11.6% to €1046.2m, while the EBITDA was off by marginally less, with an 11.4% reduction to €257.9m. The increased investment in the Eastern Mediterranean saw both depreciation and interest charges rise and the pre-tax profit fell by 28.6% to €128.2m and the net attributable profit, which had been helped by a tax credit last year, dropped by 36.5% to €103.7m. Net debt at the end of September was 9.7% lower at €1,029m, with capital expenditure being lower in Greece and in the United States, but higher in South Eastern Europe and in the Eastern Mediterranean regions. Capital investment in the period amounted to €142.2m, of which the Eastern Mediterranean accounted for €65.3m and South Eastern Europe for €64.6m. Next year, no major capital investments are expected.
Shipments of cementitious materials in the nine months declined by 8.5% to 11.9Mt, with only Egypt showing higher domestic deliveries. Lower fuel costs have now begun to improve profit margins. Downstream operations are largely confined to Greece and the United States, with the result that aggregates sales declined by some 17% to 11.7Mt and sales of ready-mixed concrete fell by around 29% to 2.9Mm³.
Greece has remained the major contributor, accounting for 36% of turnover and 37% of EBITDA. Greece and Western Europe saw turnover decline by 22.1% to €380.3m, while the EBITDA fell by 29.2% to €96m. Greek domestic cement sales continued to fall in response to the economic decline and stretched public finances, which also depressed sales of aggregates and ready-mixed concrete. Domestic cement prices have remained firm, in spite a continuing drop in demand that is likely to see domestic deliveries fall by around a quarter this year, rather worse than had been anticipated earlier in the year. Exports are holding up better, though markets in England, France and Italy, where Titan has its own distribution subsidiaries, are weak.
South Eastern Europe accounted for 16% of turnover and 24% of EBITDA, with turnover falling by 22.9% to €168.7m and EBITDA by 25.7% to €61.4m. With the notable exception of Bulgaria, prices are ahead in all markets in spite of reduced demand. In Bulgaria, prices appear now to be stabilising, having fallen under pressure from Turkish imports. In Albania, Titan is boosting volumes through imports ahead of the commissioning of the new 1.5Mta cement works, planned for next March, and should be importing around 0.5Mt this year.
The Eastern Mediterranean is now the second largest source of profit for the group, with 28% of EBITDA, while accounting for a fifth of turnover. Reflecting full ownership for the full period, as well as strong demand and higher prices in Egypt, group turnover rose by 87.1% and the EBITDA rose by 91.3% to €72.5m. Egyptian prices are now being seen as stable and the second production line at the Beni Suef works came on-stream earlier this month and should lead to the elimination of the need to import cement and clinker next year. The extent of the profit improvement comes in spite of lower margins on imports into Egypt and the downward pressure on both domestic and export prices in Turkey.