ΤΙΤC- ανακοινώνει σήμερα το 2Q20: Τι περιμένουν οι αναλυτές της Optima

Titan Cement International || Under review | CP EUR 11.00

2Q20 preview – Resilient performance on satisfactory demand and cost savings

Facts: Titan Cement international (TCI) is scheduled to release its 2Q20 results today, after the close of the market.

Management will host a conference call on Thursday at 16:30 Athens time (14:30 UK time).

  • We expect turnover of EUR 376m (-11% YoY), EBITDA of EUR 86.7m (+11.5% YoY) and net income of EUR 29m (+49% YoY). On a 1H20 basis, we forecast turnover of EUR 760m (-3% YoY), EBITDA of EUR 127m (+4% YoY) and net income of EUR 13.3m (0% YoY).

1H20 & 2Q20 Group Key P&L Forecasts

EUR m

1H19

1H20e

Y-o-Y change

2Q19

2Q20e

Y-o-Y change

Turnover

785.4

760.4

-3.2%

422.7

375.7

-11.1%

EBITDA

122.2

127.4

4.2%

77.8

86.7

11.5%

EBITDA margin

15.6%

16.8%

 

18.4%

23.1%

 

Net income

13.3

13.3

0%

19.5

29.0

+49%

Source: Optima Bank, The Company            

Comment: In a trading update for 5M20, Titan Cement presented resilient results as the impact of covid-19 on demand was less severe than initially expected, while results benefited also by declining energy costs and cost containment actions. Specifically, in 5M20 group revenues declined by 2% YoY to EUR 642m, EBITDA rose by 5.5% YoY to EUR 97m, while net income retreated by 9% YoY to EUR 3.5m.

  • As the easing of lockdowns continued in June supporting demand, we assume a similar performance to the same month last year. Specifically, our 2Q20 forecasts imply for June group turnover of EUR 119m (-9% YoY), EBITDA of EUR 30m (0%) and net income of EUR 9.8m (0% YoY), with the risk lying on the upside as the cost cutting programme announced by management to address the extraordinary situation is being implemented.

Overall, the modest effect from covid-19 and declining energy costs combined with management’s actions to preserve cash flow during this challenging period, indicate that company’s annual performance will remain satisfactory.

  • The medium-term impact of covid-19 on demand remains uncertain but governments’ plans across the world to boost infrastructure spending is an encouraging sign. We believe that at current market levels company’s valuation is attractive. We will revert soon with new estimates and valuation.