Titan Group BoD proposed a dividend payment of €0.60 per share for 2022
Titan Group BoD proposed a dividend payment of €0.60 per share for 2022
  Listed  |  Economy

Titan Group BoD proposed a dividend payment of €0.60 per share for 2022

Record sales and strong profitability growth in all markets, in a year marked by cost inflation and uncertainties.
RE+D magazine

Titan Cement International SA (Euronext Brussels, ATHEX and Euronext Paris, TITC) announced the fourth quarter and full year 2022 financial results.

According to the company's official press release:

  • Second consecutive year of record Group sales of €2,282.2m, up 33.1%, following a very strong Q4. US and Greece represent over 70% of Group sales. 
  • EBITDA rose to €331.2m with all regions posting double-digit profitability increase. Recovering EBITDA margins with solid volumes, dynamic pricing, cost-efficiency actions, and favourable USD offset sharp rise in energy and distribution costs. 
  • Very strong Q4 2022 with EBITDA growth for third consecutive quarter. Q4 EBITDA at €96.7m vs €55.6m in 2021.
  • Earnings per share increased by 24.4%. NPAT reached €109.7m (+19.3%), despite FX losses in Egypt. Hyperinflation accounting applied in Turkey with practically neutral NPAT impact after taking a €21.8m goodwill impairment charge. 
  • Net debt closed at €797.3m (+€84m) following record CapEx (€241.9m) to achieve growth, energy cost efficiencies, optimize logistics costs, and expand capacities, as well as for more working capital to support sales growth. Leverage ratio reduced to 2.4x. 
  • Highest annual specific CO2 emissions reduction (-5%) recorded in the last decade with higher use of alternative fuels and lower clinker-to-cement ratio. Green products and solutions approaching 20% of sales volumes. High ESG ratings. 
  • Group digital transformation rolled out to more plants, with production efficiencies in the form of increased output and energy cost savings, as well as with machine failure prediction detection, results in significant financial benefits. 
  • Focus on shareholder returns. Over €60m paid in 2022 as capital reduction distribution to shareholders and for share buybacks. The Board proposes a dividend payment of €0.60 per share. • Outlook remains positive given exposure to resilient markets in America as well as in Europe. Large growth and logistics investments to be finalized in 2023.

Investments & Financing 

Group capital expenditures during the year reached a 15-year high at €241.9m compared to €126.0m in 2021. Growth, energy cost efficiencies, logistics costs’ optimization, and capacity debottlenecking CapEx projects, mainly in US markets, increased during 2022. The Group invested in energy-saving projects, allowing higher use of lowercost alternative fuels, improved cement production efficiencies through digital technology, expanded our warehouse capacity to accommodate larger production volumes, optimized logistics, and reduced carbon footprint, primarily in the US and EU. Those projects will result in incremental financial benefits for the Group starting in 2023 and more so in 2024. 

The significant group capital expenditures for 2022 were aligned with the Group’s strategic objectives, demonstrating its continued commitment to sustainable and responsible business practices for long-term growth. It is noted that the cost of CapEx was also affected by prevailing inflation and the strength of the US dollar. More than 50% of the CapEx for 2022 was directed to the US, as part of the Group’s $300m growth investment program in the US during 2021-2023. 

Working Capital increased in 2022 by €92m as a direct result of higher group sales, inflationary pressures on inventories, and higher inventory levels addressing supply chain disruptions. Following an EBITDA increase to €331.2m (+€56.0m), higher capital expenditures and higher working capital needs to support sales growth, Operating Free Cash Flow (OFCF) for the year 2022 reached €18.8m versus €104.7m in 2021. Year-end net debt increased by €84.1m to €797.3m (2021: €713.2m), while the leverage ratio of Net Debt/EBITDA ratio dropped to 2.4x thanks to the increased EBITDA. The Group has a low exposure to interest rate risk as more than 80% of its debt is either in fixed rates or covered by long-term interest rate hedges. There is no material debt maturity within the next 18 months.

In December 2022, Standard & Poor’s re-affirmed its previous rating for Titan Cement International S.A. of “BB” with a stable outlook. Post-balance sheet event: In early 2023, the Group took a participation in «Aegean Perlites», a company operating perlite and pozzolan quarries on the Greek island of Yali, thereby gaining direct access to a key raw material that will allow the enlargement of the Group’s offering of low-carbon cementitious products and securing the long term pozzolan sourcing needs of the Group. 

The Group completed the program that began in October 2021 and initiated two additional share buy-back programs in March and July 2022. Each program was for €10m and a duration of up to six months. Overall, in 2022, in the context of the aforementioned share buyback programs, 1,947,721 shares were acquired by the Group for an amount of €23.8m. A new share buyback program of €10 million, approved last January, was initiated on March 1 st, 2023. Following improved profitability in 2022, the Board of Directors is proposing to the Annual General Assembly of Shareholders, scheduled to take place on May 11th, 2023, a dividend distribution of €0.60 per share. This represents an increase of 20% versus the previous year.

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