Titan (Results Q2/Η1 2013): Βy Manos Chatzidakis

Titan Q2/H1 results were in line with consensus estimates. Flat bottom line was driven by US operations (+14%) and the re-launch of the public works in Greece (+22%). On the other hand gas shortages in Egypt (-26%) and soft demand in SE Europe (+3%) weighed negatively on the results. Despite the mixed geographical performance we see some qualitative and quantitative sequential improvements which provide some optimism for the following H2. 

Key points:

¡  Consolidated turnover reached €571m, posting a 4% increase compared to the first half of 2013. EBITDA stood broadly unchanged at €89m, whereas net profits after taxes and minorities stood at €3m, compared to €22m losses in the same period last year.

¡  The weakening of local currencies against the Euro had an adverse impact on first half results. At stable exchange rates, turnover and operating profitability would have increased by 7% and by 4%, respectively.

¡  The period April – June 2014 was the 9th consecutive quarter of top-line growth, as turnover in the second quarter increased by 2% to €319m. EBITDA dropped by €6.5m to €58.5m, due to a €14m reduction in the operating contribution of Egypt. NPAT rose to €14m from €5m in 2013.

¡  Interest and Financial costs reduced in Q2 by €5.7mn or 24.4% at €17mn

¡  Net debt reduced to €490mn vs €541 in Q1 (€509mn on Dec. 31.2013.)

¡  According to the press release management remains optimistic for US market and Greece while the group proceeds with an investment to secure energy supply at lower prices in Egypt which will return utilization capacity to normal levels.

Titan Results H1 2014 In thous. euro 2013 2014 Δ Sales 549,331  571,221  4.0%  Q2 314,095  319,427  1.7%  EBITDA 88,254  88,997  0.8%  (% Sales) 16.07%  15.58%  -49 bps  Q2 64,983  58,524  -9.9%  (% Sales) 20.69%  18.32%  -237 bps  Net Income -21,799  2,908  113.3%  (% Sales) -3.97%  0.51%  +448 bps  Q2 5,268  13,919  164.2%  (% Sales) 1.68%  4.36%  +268 bps

Manos Chatzidakis

Head of research

Beta Securities S.A.

29 Alexandras Ave.

GR - 11473

Athens, Greece

Tel: +30 210 6478755 /754

Fax +30 210 6448791

Email: mchatzidakis@beta.gr

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