Dynamic crash on the New York Stock Exchange, decarbonization and digitization are the pillars on which the strategy for the Titan of the future.
As emerged from yesterday’s teleconference of the group’s management with analysts, the reduction of the group’s environmental footprint, digitization (smart cities, artificial intelligence) and the resilience of infrastructure, in times of climate crisis, are the investment peaks that strengthen the development Tale of Titan.
The group is noted to have committed to producing concrete with a carbon neutral footprint by 2050. In line with the company’s strategy, investments to further improve the energy mix have continued unabated, with increased use of alternative fuels, raw materials and higher use of supplementary cementitious materials so as to reduce the clinker/cement ratio.
The initiatives digital transformation are also progressing according to plan, aiming to further implement digital systems in the group’s factories and thus further improve performance.
Attractiveness, new funds, acquisitions
Titan Cement International SA (Euronext Brussels, ATHEX and Euronext Paris, TITC) announced yesterday that it intends to proceed with a US listing of its group subsidiary, Titan America, raising capital that will facilitate the financing of future growth and investment opportunities of Titan Group and Titan America.
Titan America, with sales of $1.6 billion, is a dynamic and fully vertically integrated company, operating in the strong growth major economic regions of the US East Coast, with a presence and leading position in the markets of Florida, the Mid-Atlantic states and in the New York/New Jersey Metropolitan area.
Why does the group choose to take the big step by entering the Mecca of Stock Exchanges?
- Titan, which has production units in Greece, the USA, Southeast Europe, Egypt, Turkey, Brazil and is traded on the Athens Stock Exchange for 2.4 billion euros, with its total net debt (and that of Titan American) standing at the end of 2023 at 660 million euros, with its listing in the… stock market Mecca (USA) will increase the attractiveness of the share on the Athens Stock Exchange as well.
- At the same time, it will raise funds that will contribute to the financing of its investment plan, around 250 million euros for 2024. Of course, the positive operating cash flows of the group are enough to run the investments, but in any case new funds are welcome.
- Listing on the US stock market also paves the way for takeovers, takeovers and mergers of companies in the industrial sector.
The success story in the USA
O Titanwhich operates in America with two plants, has been selected by the US Department of Energy for a grant of up to $61.7 million to develop innovative technology for a thermally activated clay production line at its Roanoke, Virginia plant.
Against the backdrop of the country’s resilient economy, the group’s performance in USA during the first quarter they remained at high levels, thanks to strong demand fundamentals, as shown by the financial results. In a quarter that traditionally shows seasonally low demand in the industry, the group’s performance was affected by heavy rains and bad weather conditions. However, sales increased and remained high, while price momentum was maintained.
Planned annual maintenance shutdowns at the two cement plants occurred earlier this year compared to 2023, with Q1 results burdened by more expenses (9.2% EBITDA earnings growth in USD, excluding these costs) . Customer orders remain high and demand is high due to backlogs for both public and private projects.
The impact of the Infrastructure Initiative (IIJA) is becoming increasingly evident, while the Technology Intensification Act (CHIPS) is driving and empowering the transformation of the US industrial sector. Following the upgrades to the intake stations in Tampa and Norfolk, the group can now further supply its operations in the Southeast and Mid-Atlantic States and thus meet the increased demand.
Strong performance in the first quarter
At the same time, a strong start to the year with sales growth and improved profitability “witness” Titan’s quarterly financial results. The year started with strong sales growth across all regions, reaching €623.7m, (up 6.1%) in a quarter with increased demand across all our products and stable price levels. EBITDA profits amounted to €109.8m, recording the eighth consecutive quarter of EBITDA profit growth.
In this context, the net profits after taxes and minority rights were particularly strengthened, reaching €52.4 million, registering an increase of 18.4%, while the net debt/EBITDA ratio is at the low levels of 1.2x. Free cash flow recorded seasonal inflows of €14m in the quarter. The group’s net debt stood at €684m, compared to €660m at the end of 2023, while the net debt/EBITDA ratio stood at 1.2x.
According to the group, a positive outlook for the year is created thanks to increased demand, stable price levels, improved energy cost management and improved operational efficiency. At the same time, efforts to reduce carbon emissions continue, including the important carbon dioxide capture and storage project in Greece and the first thermally activated clay production project in West Virginia (USA).
Source: Ot.gr
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