Titan completes Pennsuco enlargement early

Titan completes Pennsuco enlargement early
Published: 01 September 2004

Titan’s first half turnover increased by 7.9% to EUR5261.7m, which represents a 12.4 per cent advance at constant exchange rates.  The operating profit at the EBITDA level rose by 19.5 per cent to EUR144.2m, which represents a 22.3 per cent improvement excluding exchange rate movements, while the pre-tax profit advanced by 56.2 per cent to EUR101.7m. 

Group shipments of cement and clinker rose by around nine per cent to 6.7Mt and the aggregates volume rose by a similar percentage to 10.7Mt.  Deliveries of ready-mixed concrete, however, were only some four per cent higher at 2.5Mm3, partially reflecting cement shortages in Florida.

The Greek turnover rose by 11.3 per cent to EUR268.1m while the EBITDA advanced by 15.1 per cent to EUR91.6m, in spite of higher kiln fuel costs.  Benefits were seen from the modernised cement works in Salonica and from the last preparations for the Olympic Games.  As supplies of ready-mixed concrete to these projects were finished, cement demand in Attica fell back, but continued to grow in other parts of the country, notably in the north.  While overall domestic deliveries were off by around six per cent, export shipments increased again, though higher freight rated increased the pressure on margins. 

The restructuring of the businesses in Bulgaria and Macedonia became effective on the 5th of May, and Bulgaria, where Titan’s capacity has virtually doubled, showed strong growth, which looks set to continue.  Cement deliveries in Macedonia and Serbia were also ahead, in part thanks to a milder start to the year, but the outlook here is more uncertain and costs in Macedonia were negatively influenced by repairs to the Usje works. 

A 10 per cent fall in the value of the dollar negated most of the 11.9 per cent organic growth to leave turnover just 1.9 per cent ahead at EUR209.6m, but at the EBITDA level a 30.6 per cent underlying improvement still produced n 18.8 per cent advance to EUR30.3m.  The cement shortage in Florida led to customers being put on allocation for most of the second quarter, which notably affected Titan’s downstream operations in the state.  However, upgraded Pennsuco plant came on stream in June, two months ahead of the original plan, allowing increased deliveries into this area of shortage and the benefits should be felt in the second half.