Emerging markets focus sees profits rise 530% at Titan Europe
A DELIBERATE focus on the potential of the emerging markets has delivered spectacular results for Worcestershire steel wheel manufacturer Titan Europe.
In its 2011 results the company reveals revenue growth of 38.7% with pre-tax profit up 530.5%.
Mike Aker, Titan’s chief executive, said: “The group’s current order book is strong and the flow of new contracts should see further progress in 2012; longer term, the business has great potential for its products and for increased market share penetration through both Titan’s innovative approach and technical engineering expertise.”
He added that the macro-economic climate may not be in Titan Europe’s control but the positioning of its business in developing markets with growth products gave it confidence for the future.
This confidence has been underlined with the announcement the group is to develop a new manufacturing facility in Turkey , having bought out its joint venture partner in that country.
Group revenue for 2011 was £492.5m (2010: £355.2m), way ahead of market expectations. After adding Titan Europe’s share of the profits from its associate and joint venture (Wheels India and Titan Jantsa in Turkey), pre-tax income was £21.6m (2010: £3.4m).
The Wheels Division recorded revenue of £184.4m (2010: £135.6m), up 36%, with a trading profit of £17.2m (2010: £9.6m). This amounted to a trading margin of 9.3%, an increase of 2.2 percentage points over the performance of 2010.
The Undercarriage Division achieved revenue of £308.1m (2010: £219.6m), an increase of 40.3%. Trading profit was £15.8m (2010: £4.5m), which amounted to a trading margin of 5.1%, an increase of 3.1 percentage points over 2010.
Overall, the Group’s trading profit was £33m compared with a £14.1m profit in 2010.
After restructuring and other one-off costs, the group operating profit was £29.7m (2010: £12.3m).
Basic earnings per share were 21.01p (2010: 4.58p).
Operating cash inflow was £41m (2010: £31.2m) and cash used for investment amounted to £22.1m (2010: £10.5m) primarily for acquisitions in Turkey and South Africa and capital expenditure for capacity increases in Spain and Brazil.
Net debt at the year-end was £124.4m (2010: £132.8m).
The group’s current order book is strong and the flow of new contracts is expected to see further progress in 2012; longer term, the group said the business had great potential for its products and for increased market share .
