1
2021
TITAN CEMENT GROUP
integrated
annual report
About the Report
The 2021 TITAN Cement Group Integrated Annual Report (IAR 2021) has been prepared in accordance with the Belgian law,
the 2020 Belgian Code on Corporate Governance, the Non-financial Reporting Directive 2014/95/EU, the European Taxonomy
Regulation (EU) 2020/852, the International Financial Reporting Standards (IFRS) and the International Integrated Reporting
Council (IIRC) principles for integrated reporting.
Other reporting frameworks followed by TITAN Cement Group include the UN Sustainable Development Goals (SDGs) 2030, the
UN Global Compact Communication on Progress Guidelines, the Charter and Guidelines of the Global Cement and Concrete
Association (GCCA), the Sustainability Accounting Standards Board (SASB) Standards and the Carbon Disclosure Project (CDP)
for climate change and water security. In 2021, the Group also started reporting according to the Task Force on Climate-related
Financial Disclosures (TCFD) recommendations.
The separate and consolidated financial statements of the IAR 2021 were audited by PwC. The ESG performance overview and
statements were independently verified at a reasonable level by ERM Certification and Verification Services (ERM CVS), in
accordance with the Charter and Guidelines of the Global Cement and Concrete Association (GCCA) and the Advanced Level
criteria for Communication on Progress of the United Nations Global Compact (UNGC).
The independent auditor’s report by PwC and the independent assurance statement by ERM CVS are included in the IAR 2021 and
are available online at www.titan-cement.com/newsroom/annual-reports. You may access the IAR 2021 by scanning the QR code
with your mobile device.
We welcome your feedback, which you can send to us through the link above.
Photos on the cover:
Main photo: Rod El Farag Axis, Cairo, Egypt
Bottom middle photo: Miami All aboard Florida Rail Station and residential apartments. Approximately 80% of the cement used is TITAN's
lower carbon cement Type IL
Bottom right photo: Titan America employees
Photos on pages 24 & 74: Y. Yerolymbos
1
2021 highlights
Message from the Chairman of the BoD
Message from the Chairman of the Group Executive
Committee
Overview 6
Our business approach in a changing
global landscape
A long history of sustainable growth
One set of strong values
Our Group strategy: Transforming for growth
Global presence
Creating and sharing value
Focusing on material issues
Moving ahead with ambitious ESG targets
for 2025 and beyond
Working together for sustainable development
Corporate governance and risk management 54
Corporate governance statement 55
Corporate governance code
Capital, shares and shareholders
Board of Directors
Composition and operation of Board committees
Diversity and inclusion
Internal audit and risk management in the scope
of the financial reporting process
Internal audit
Remumeration report 2021
Information to be disclosed pursuant to Article 34
of the Royal Decree of 14 November 2007
Shareholder information and services
Risk management 73
Risk management process
Risk management governance and controls
TITAN's principal risks
ESG performance review 80
ESG performance overview 82
Decarbonization and digitalization
Growth-enabling work environment
Positive local impact
Responsible sourcing
Good governance, transparency and business ethics
TCFD Framework implementation
(climate change risk and opportunities)
Taxonomy EU Regulation implementation
ESG performance statements 98
Performance highlights 24
Financial performance
Equity market information
ESG performance acknowledged by
world-leading rating agencies
ESG performance:
• Making progress towards our ESG targets
• Delivering on our ambitions with concrete
actions
• Good governance, transparency and business
ethics
• Climate-related financial disclosures (TCFD)
Regional performance
Outlook 2022 51
Financial review 142
Financial performance overview 144
Review of the year 2021
Regional review of the year 2021
Financing and investments
Resolutions of the Board of Directors
Outlook
Treasury shares
Sale of stock in the framework of the stock
options plan
Post balance sheet events
Going concern disclosure
Viability statement
Financial statements 151
Parent company separate summarized
financial statements 219
Declaration by the persons responsible 221
Auditors’ reports 222
Glossary 232
Understanding TITAN
Management report
Contents
245.7
Specific water
consumption
(l/t cementitious product)
829
New hires across
the Group
0.91
Lost time injuries
frequency rate (LTIFR)
for employees
654.2
Specific net direct
CO₂emissions
(kg/t cementitious product)
5,358
Employees
(as at 31 December 2021)
16.6
Specific dust
emissions
(g/t clinker)
2021 Highlights
€275.2m
EBITDA
(Earnings before interest, taxes,
depreciation and amortization)
€1,714.6m
Revenue
“ΒΒ”
On a stable outlook
Credit rating (S&P)
2
3
Message from the
Chairman of the BoD
Dear Shareholders and Stakeholders,
Two full years now into the COVID-19 pandemic
and, while some uncertainty remains, especially in
emerging markets, we are beginning to see light
at the end of the tunnel. The resulting recovery in
demand, in conjunction with workforce shortages,
has created supply chain disruptions and forced
central banks into a juggling act between containing
inflation and preventing a recession. On top of
that, the war in Ukraine has spurred geopolitical
uncertainties and volatility in the energy markets,
further accentuating the rise in input costs.
Against this inflationary backdrop, the costs of
running businesses have risen sharply, forcing
companies to pass on the increases to their
customers in order to maintain profitability. We, at
TITAN Cement Group, believe that we will be able
to adapt to this new reality fairly quickly, which
will allow the company to remain on its sustainable
growth path.
In 2021, amidst a complex and challenging
environment, we successfully pursued our priorities
of protecting our people, mitigating the COVID-19
impact on society and safeguarding the continuity
of the business. These challenges will continue
going forward. We are fully aware of the fact that,
as we gradually move into the new post-pandemic
era, corporations will be evaluated not only on
financial results but also on how they articulate
values, develop talent, manage supply chains and
environmental impact, embrace diversity and engage
with employees, customers and local communities.
To ensure that the Group continues to adhere to
the highest standards of corporate governance, we
concluded a formal evaluation of the effectiveness
of the Board, which we had launched towards the
end of 2020. The assessment addressed the Board’s
performance and its interaction with executive
management, as well as its size, composition,
functioning and committees. Later in the year,
Board members were updated on the developments
of climate legislation and its implications for TITAN.
In the fall, we conducted a full strategic review
to approve the new growth platform and capital
allocation priorities proposed by the executive
“We, at TITAN Cement Group, believe that we will be able to adapt to this new
reality fairly quickly, which will allow the company to remain on its sustainable
growth path.”
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
team. The balance of initiatives and the merits of
investment in the core business and beyond it were
discussed in depth.
On the basis of our results, we activated a €10m
share buy-back program and returned €0.5 per share
to all our shareholders.
In closing, and on behalf of the TCI Board of
Directors, I wish to congratulate management for yet
another year of an all-round exemplary performance
and extend our best wishes to all for a happy and
successful 2022.
Takis Arapoglou
Chairman of the BoD
4
Message from the Chairman
of the Group Executive Committee
Dear Shareholders and Stakeholders,
As I look back on 2021, I feel a sense of accomplishment and pride.
For how we adapted to the challenges that the COVID-19 pandemic
continued to pose. For the way we delivered results and served our
customers effectively, amidst soaring energy prices and global supply
chain disruptions. For how, staying true to our values, we took care of our
colleagues and communities, with health and safety top of mind.
And for how we learned new things, developed additional capabilities, and
continued to lay the foundations for sustainable future growth.
Volumes and prices rose across our geographies on the back of buoyant
construction activity, yet cost inflation weighed on margins. Our US
business experienced record sales as its operations on the East Coast
benefited from robust employment, increased consumer spending, tight
housing inventories and attractive mortgage rates. Greece, where all
construction segments displayed positive trends, increasingly appears
to be on a steady long-term growth trajectory. Residential construction
in the main urban centers, coupled with private infrastructure and small
industrial unit projects across the country, bolstered demand for our
products. Building activity was also strong in Southeastern Europe, but the
spike in energy costs penalized results in the region. In Egypt, where our
plants have been operating at the levels of the production cap imposed
by the state, investments in public housing and the rehabilitation of
port infrastructure have supported sales growth. And whereas in Turkey
the market softened as a result of the currency crisis, the one in Brazil
continued to grow.
Overall revenue for the Group increased by 6.7% to €1.7 billion. Due to
the fact that price increases did not fully mitigate energy and freight
headwinds within 2021, operating profitability (EBITDA) declined by
3.6% to €275.2 million. Net profit after taxes and minority interests
(NPAT) came in at €91.9 million. After a €41.8 million increase in capital
expenditure, which had been restrained following the onset of the
pandemic in 2020, net debt increased to €713.2 million, or 2.61 times
EBITDA.
During the year, we reviewed and refined our strategic priorities. Our
strategy has talent, skills, culture and organization as its foundation
and relies on the triptych “decarbonize – digitize – deliver” to transform
the Group so that it can tap into new sources of growth. At the core are
also our ESG targets for 2025 and beyond, in direct alignment with our
commitment to the UN Sustainable Development Goals (SDGs) and the
Ten Principles of the UN Global Compact. They are underpinned by strong
governance, transparency and business ethics, and are organized in four
focus areas – decarbonization and digitalization, growth-enabling work
environment, positive local impact, and responsible sourcing.
Addressing climate change remained at the top of our sustainability
agenda, as we were among the first cement companies worldwide with
decarbonization targets validated by the Science Based Targets initiative
(SBTi). Ahead of COP26, we signed the “Business Ambition for 1.5°C”
Commitment letter, joining a number of leading companies seeking
to keep warming to 1.5°C and reach net-zero emissions by 2050. To
improve our disclosure of climate-related risks, we started implementing
the recommendations of the Task Force on Climate-related Financial
Disclosures (TCFD). And we were recognized by the CDP as a global
5
climate leader for our transparency and actions to mitigate climate
change and transition to a net-zero economy. Our net CO₂ emissions
declined in line with our 2030 goals, as we ramped up our consumption
of alternative fuels and accelerated the transition to greener products.
The investment for a pre-calciner at our Kamari plant in Greece, which
will enable the utilization of greater quantities of waste-derived fuels,
is progressing according to schedule. Meanwhile, since September,
approximately half of Titan America’s cement output consists of the
lower-carbon Type IL cement.
We continued to invest in innovation and to contribute to the activities
of the Innovandi research network of the Global Cement and Concrete
Association (GCCA). We evaluated a number of novel decarbonization
and carbon capture and utilization technologies, and we experimented
with the use of hydrogen as a fuel enhancer in our process in Greece
and Bulgaria. On the other side of the Atlantic, we commissioned the
world’s first industrial-scale plant to reclaim, dry and electrostatically
separate landfilled fly ash.
Our digitalization journey progressed further, in collaboration with an
ecosystem of start-ups, universities, equipment manufacturers, and
specialized advisers. Our Digital Center of Competence continued
the rollout of our AI-based real-time optimizers and failure prediction
solutions across our production facilities, yielding gains in productivity
and energy efficiency. Our supply chain capabilities were augmented
through the development of proprietary tools to forecast sales demand
and the cost of selected production inputs, whereas the deployment of
digital customer applications helped us reinvent how we interact with
our customers, while elevating their experience.
Throughout the year, we stayed close to those around us, with
initiatives to shield our people, business partners and communities
from the effects of the pandemic. The vaccination cost of more
than 1,500 employees and contractors was covered by the company.
Initiatives to promote physical and mental health were launched in all
regions. We strengthened our accident prevention systems further and
ended the year with a Lost Time Injuries Frequency Rate (LTIFR) that
is among the best in the industry. We launched a new Diversity, Equity
and Inclusion policy and leveraged digital tools to continue to upskill
our people despite COVID-19 restrictions.
To maximize our positive local impact, our business units renewed
their efforts to improve biodiversity and water management, promote
recycling and circular economy practices, and curtail air emissions. At
the same time, almost 2,000 of our employees volunteered in initiatives
to support 0.4 million people in our local and broader communities.
Last but not least, having moved faster than planned in energy-
efficiency and waste-management certification, we will not only
continue pushing for further improvement in this area, but will also now
focus on our supply chain, seeking to empower our business ecosystems
to incorporate sustainability considerations in decision making. To this
end, a Sustainable Supply Chain Roadmap was developed to ensure that
our key suppliers meet the Group’s ESG standards.
Looking ahead to 2022, the war in Ukraine is creating geopolitical
uncertainties with macroeconomic implications that are bound to
impact market trends and further increase volatility and risks. While we
are preparing for different eventualities, we remain cautiously optimistic
for three reasons.
First, because we still expect growth in most of our markets. In the
USA, a shortage of available housing and significant funds earmarked for
cement-intensive infrastructure projects should support consumption
for several years ahead. To capitalize on this trend, we are investing to
expand our supply chain capacity in the market, most notably through
the construction of two new storage domes in Tampa, Florida, and
Norfolk, Virginia. In Europe, leading indicators are pointing towards
continued growth in all demand segments. And the stabilizing
macroeconomic environment in Egypt, along with the country’s housing
and infrastructure needs bodes well for construction. Cost challenges
will persist, but a favorable pricing environment in most countries and
our numerous efforts to address inflationary pressures should mitigate
the impact on operating profitability.
The second reason for optimism is our progress in decarbonization
and digitalization, which are now well embedded in our strategy. We
will continue to accelerate the reduction of our carbon footprint with
novel products and solutions, new bets in adjacent value chains, such
as waste management and renewables, and further investments in
research and development. We will also keep scaling up our world-
leading digital innovations and leveraging the power of data to become
more efficient and competitive, while creating more value for our
customers.
Yet the most important reason for our optimism are the skills, drive and
energy of our colleagues. Their inspiring dedication and endurance, at all
times, which is what keeps the company going and growing.
Building the future means building better, smarter, more sustainably.
In 2022, we will continue to harness the advantages offered by
decarbonization, digital transformation and business model innovation
to benefit our customers, employees, suppliers, and communities.
As always, we will do so with integrity, compassion, humanity and
accountability, as we seek to shape a better and greener future for all.
Dimitri Papalexopoulos
Chairman of the Group Executive Committee
“Building the future means building better, smarter, more sustainably. In 2022, we will continue
to harness the advantages offered by decarbonization, digital transformation and business model
innovation to benefit our customers, employees, suppliers, and communities.”
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
6
Roanoke cement plant, USA
77
overview
UNDERSTANDING TITAN
An overview of our Group and our strategy in a changing
global landscape. Our approach to value creation for our
stakeholders, our materiality assessment process and our
ESG targets for 2025 and beyond.
8
Our business approach
in a changing global landscape
Building on 119 years of industry experience and commitment to sustainable growth, TITAN
has become an international cement and building materials producer, serving customers in
more than 25 countries through a network of 14 integrated cement plants and three cement
grinding plants. TITAN also operates quarries, ready-mix plants, terminals, and other
production and distribution facilities.
Our approach
Turning aspiration into action, we are working hand in
hand with our customers, supply chain partners, peers
and our other stakeholders across geographies, to help
limit global warming to 1.5
O
C and achieve a net-zero
economy by 2050.
Committed to ambitious science-based targets, we are
continuously reducing our carbon footprint by increasing
the use of alternative fuels, improving energy efficiency,
developing low-carbon products, and adopting innovative
technologies and solutions.
Our approach
We are among the early adopters and leaders of digital
innovation in the cement industry, harnessing the power of
digital breakthroughs.
Our digital journey so far has been powered by our
innovative, entrepreneurial spirit and willingness to test
and learn. With Artificial Intelligence solutions tailored to
the needs of the cement industry, we are transforming
our operations for ultimate efficiency and the delivery of
high-quality products, with an eye on the present and future
needs of our customers. At the same time, we help minimize
energy consumption and reduce CO₂ emissions, supporting
our net-zero goal.
Digital transformation as a
foundation for future growth
Climate change and the road
towards a carbon-neutral future
Climate change represents a long-term risk for our planet
and society. It requires the mobilization of organizations
across many sectors, the cement industry among them. In
2021, the Global Cement and Concrete Association (GCCA)
published its Roadmap for net-zero Concrete, which
sets out a pathway to help limit global warming to 1.5
O
C
and deliver society with net-zero concrete by 2050. Our
industry is working across the built environment value
chain to deliver on this commitment and is calling on its
stakeholders to play their part as well.
The Fourth Industrial Revolution, driven by the advent of
the Internet of Things, big data, artificial intelligence and
advanced analytics, promises to transform key components
of the industry’s value chain.
Traditional value generation drivers and differentiators
are complemented by new digital tools that unlock value
through improved operational efficiency and higher
customer engagement. Companies that embrace Industry
4.0 early on can reap significant benefits.
UNDERSTANDING TITAN
OVERVIEW
9
Our approach
As the world is transitioning to a net-zero , circular
economy, we are playing an active role in the development
of the sustainable, green building materials and solutions
of tomorrow.
We focus on their affordability, durability and recyclability
as well as on their carbon footprint. When designing them,
we evaluate the environmental impact that they have
throughout their entire life cycle, meeting the increasing
needs of our customers for sustainable products and
services.
At the same time, we encourage our partners to
incorporate sustainability considerations in their business
decisions and daily behaviors, promoting responsible
sourcing across the built environment value chain.
Our approach
Sustainability is at the heart of our strategy, as reflected on
our everyday business practices and the behaviors of our
people.
With clear, measurable ESG targets and concrete plans in
place across our regions, we are focusing our efforts on the
areas where our actions and sustainable solutions can have
the biggest positive impact, directly and indirectly, in line
with the UN Sustainable Development Goals (SDGs). To
address sustainability challenges, we have joined forces with
local and global stakeholders.
Increasing demand for sustainable
products and services
Comprehensive sustainability plans
to create value for all stakeholders
We serve society’s needs for safe, durable, resilient, and
affordable housing and infrastructure. We create value by
transforming raw materials into products – cement, concrete,
aggregates, fly ash, dry mortars, blocks, and other building
materials. We offer transportation and distribution services to
our customers, as well as a range of additional solutions, from
beneficiation technologies to waste management.
Amidst accelerating shifts and disruptive events, such as the
COVID-19 pandemic, we effectively address critical challenges
and play our part in building a better, more sustainable future
together with our stakeholders.
As the world continues to urbanize, demand for
sustainable infrastructure and green building materials and
solutions is set to rise.
Concrete is an essential building material that has shaped
our world and is critical for addressing society’s needs for
the sustainable built environment of tomorrow. It will play
an integral role in creating sustainable and prosperous
communities through the delivery of key infrastructure,
homes, clean energy and a more resilient environment.
Customers increasingly seek sustainable products that will
meet their evolving needs.
Building a sustainable future demands comprehensive
planning and collaboration with other businesses,
governments, academia and society at large.
Companies need to set goals, develop roadmaps to achieve
these goals, track their performance and communicate
their progress to their stakeholders in a consistent and
transparent manner.
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
10
1902-1960
INTERNATIONAL EXPANSION
GROWTH IN GREECE
FOUNDATIONS
1990 - 2018: Acquisitions and investments
A long history
of sustainable growth
Driven by our entrepreneurial spirit and our commitment to sustainable growth, we have
expanded beyond our Greek roots with operations in four continents.
1902
TITAN Cement is founded with the
opening of the first cement plant in
Elefsina, Greece. It is the first cement-
producing unit in Greece
1912
Listing on the Athens Stock Exchange
1951 - 1957
Rapid growth of exports, which during
the period account for over 50% of the
company’s sales and approximately
50% of Greece’s total cement exports
1962
Second cement plant in Thessaloniki
1968
Third cement plant in Drepano, Patras
1976
Fourth cement plant in Kamari,
near Athens
1990-2021
1960-1990
• (1992) 60% in Roanoke Cement,
Virginia, USA
• (1998) Cementarnica Usje, North
Macedonia
• (1999) Beni Suef Egypt (50% joint
venture)
• (2000) 100% of Roanoke, Virginia,
and Pennsuco, Florida, USA
• (2002) Kosjeric, Serbia
• (2002) Alexandria PCC (APCC),
Egypt (50% joint venture)
• (2003) Zlatna Panega, Bulgaria
• (2007) Greenfield investment,
Antea plant, Albania
• (2008) 50% in Adocim, Turkey (JV)
• (2008) 100% of Beni Suef and APCC
Egypt
• (2010) Sharr plant, Kosovo
• (2016) 50% in Cimento Apodi,
Brazil (JV)
• (2018) 75% in Adocim, Turkey
2019
OUR GROWTH JOURNEY SINCE 1902
UNDERSTANDING TITAN
OVERVIEW
Titan Cement International S.A.
becomes TITAN Group’s parent
company and is listed on Euronext
Brussels, Euronext Paris, and the
Athens Exchange
11
Ingrained in the Group’s identity and embedded in our culture and our people’s practices, our
values guide the way we conduct our business – with respect, accountability, and responsibility.
Our values are at the core of who we are; they guide our strategy and provide the
foundation for all our operations. They have provided our people with a strong bond and
supported the growth that has sustained us for over a century, stemming directly from the
principles, beliefs, and vision of our founders back in 1902. They remain the solid basis of our
culture and family spirit.
One set of strong values
Know-how
▶
Enhancement
of knowledge base
▶
Proficiency in every function
▶
Excellence in core
competencies
Integrity
▶
Ethical business practices
▶
Transparency
▶ Open communication
▶
Good governance
Value to the customer
▶
Anticipation of customer
needs
▶
Innovative solutions
▶
High quality of products
and services
▶
Continuous improvement
▶
Learning organization
▶
Willingness to change
▶ Rise to challenges
Delivering results
▶
Shareholder value
▶
Clear objectives
▶
High standards
▶
Corporate Social Responsibility
▶
Safety first
▶
Sustainable development
▶ Stakeholder engagement
▶
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
12
TITAN Group has created long-term value for its stakeholders for
almost 120 years, by constantly evolving and renewing a strategy
of geographic diversification, selective vertical integration,
continuous operational improvement and a focus on human
capital and sustainability.
Building on this solid foundation, the Group has reviewed its
strategic direction and priorities, to focus its growth-oriented
strategy on harnessing the new opportunities presented by
decarbonization and “Industry 4.0”, which are transforming the
industry’s customer engagement and value creation models,
while continuing to leverage TITAN’s proven abilities to deliver
on improving performance and develop distinctive competences.
Our three-year strategic plan incorporates the perspectives
and priorities of our businesses around the world, coupled with
the key directions and commitments provided by the Group’s
Executive Committee and BoD.
Our strategy is founded on the following three pillars:
Deliver
Our operations around the world are well placed to deliver
robust results for the foreseeable future, based on strong market
momentum for growth in housing and infrastructure spending
(often supported by government incentives in the post-pandemic
environment), positive macroeconomic trends and local markets
recovering from cyclical lows.
Building on this solid outlook, TITAN will leverage its continuous
performance improvement record to deliver operational
excellence in manufacturing, supply chain and customer
experience. The Group will thus continue its focus on cost-to-
produce and cost-to-serve, as well as on providing solutions and
a superior customer experience across all its businesses.
This operational excellence extends to TITAN’s ESG performance,
where the Group has achieved strong environmental, safety and
social engagement performance in the last 20 years. TITAN’s
ESG targets for 2025 and beyond provide a rich and ambitious
set of measurable goals in all ESG focus areas, comprising
the dimensions of decarbonization and digitalization, a
growth-enabling work environment, positive local impact and
responsible sourcing, all underpinned by good governance,
transparency, and business ethics.
Decarbonize
TITAN’s vision is to grow by transforming our business, focusing
on resilience and innovation to serve our customers more
efficiently as we move towards a carbon-neutral world. To that
end, the Group has set a 2030 target to reduce its direct net
specific CO₂ emissions (Scope 1) to 500 kg CO₂/t of cementitious
material, in line with the targets of the most ambitious players
in the industry and validated by SBTi (Science Based Targets
initiative). Furthermore, TITAN is committed to playing its part
to limit global warming to 1.5°C and to reach net-zero emissions
by 2050.
TITAN’s decarbonization strategy includes a comprehensive
set of levers to reduce emissions of cement production, by
accelerating the use of alternative fuels, substituting clinker by
cementitious materials with lower carbon intensity, increasing
energy efficiency and optimizing its raw materials mix. New
innovative products will be offered to TITAN’s customers
that will meet their needs for durable and sustainable
building materials, leveraging the Group’s unique assets and
competencies, including its proprietary fly ash beneficiation
technology. In the long-term, the Group will continue its
tradition of innovation by piloting new emerging technologies for
the future net-zero construction value chain.
Digitize
TITAN has been among the pioneers in its sector in
implementing innovative Artificial Intelligence (AI) digital
solutions in its operations. Significant innovations have already
been implemented, with measurable impact in operational
efficiency, such as AI-based real-time optimizers and predictive
maintenance in manufacturing, use of advanced analytics for its
supply chain network and spare parts inventories, use of Building
Information Modelling for its new infrastructure projects, and
digital applications for its customer-facing operations.
Leveraging this momentum, TITAN aims to continue improving
its operating performance and customer experience, by
leveraging big data and AI to develop a digitally empowered and
efficient operating model and to provide cutting-edge digital
solutions for its customers. TITAN’s “cement plants of the
future” will fully harness the power of digital technologies and
advanced analytics to achieve higher asset productivity and
reliability, reduce production inputs and energy consumption,
and decrease CO₂ emissions. The Group is also deploying
innovative digital solutions for the next generation of supply
chain management, with optimized distribution networks,
predictive planning and dynamic logistics operations. Finally, a
digitally enabled customer experience will drive value generation
for our cement and concrete business through excellence in
customer service.
Our Group Strategy:
Transforming for Growth
TITAN’s growth-oriented Group strategy aims to harness the opportunities presented by
Decarbonization and Digitalization, and to provide the building materials and solutions that
will bring additional benefits to our customers, employees, suppliers and communities.
UNDERSTANDING TITAN
OVERVIEW
13
Building capabilities and developing talent
The foundation of our growth-oriented strategic plan is TITAN’s
long tradition of building capabilities and developing talent, with
an entrepreneurial mindset and a values-driven culture. The
strategic plan encompasses, and is powered by, an accelerated
drive to transform by further building our talent, both in our core
competences, as well as in new skillsets. In parallel, growth will
be underpinned by an agile and learning-oriented organization,
based on our performance-oriented culture and our focus on
long-term sustainability, with digitally enabled structures and
processes, and a safe, healthy, inclusive, and diverse work
environment for our people.
Developing our growth platform
Leveraging operational excellence, a distinctive ESG performance
and superior customer engagement, the decarbonization of its
operations and the digitally enabled operational model, TITAN
will develop its growth platform capitalizing on opportunities
to strengthen and extend its current core business, as well as
pursuing opportunities in new sources of value in the building
materials value chain. To that end, important investments are
already implemented or planned to enhance the operating
leverage and sustainability of existing assets, increase the
Group’s logistics capabilities, pursue further targeted vertical
integration, and accelerate the development of new products
and customer solutions.
TALENT
Skills & organization
DIGITIZE
Manufacturing
Supply Chain
Customer
Data
DELIVER
Continuous
improvement
Customer
Operations
DECARBONIZE
Manufacturing
Commercial
Αdjacencies
GROWTH
Leverage assets and expand in new sources of growth
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
14
1
3
4
2
USA
1
2
USA
PRINCIPAL PRODUCTS/
ACTIVITIES
3
IMPORT
TERMINALS
8
QUARRIES
82
READY-MIX
PLANTS
7
CONCRETE
BLOCK
PLANTS
4
*
FLY ASH
PROCESSING
PLANTS
2
INTEGRATED
CEMENT PLANTS
EBITDA
158.0m
REVENUE
983.6m
ASSETS
1,133.3m
USA
Integrated cement plants
1. Roanoke – Virginia
2. Pennsuco – Florida
Greece
Integrated cement plants
1. Thessaloniki
2. Kamari
3. Patras
Cement grinding plant
4. Elefsina
Brazil
USA
Greece
2
1
Brazil
(Joint venture)
Integrated cement plant
1. Quixere
Cement grinding plant
2. Pecem
€
3
QUARRIES
4
READY-MIX
PLANTS
PRINCIPAL
PRODUCTS/
ACTIVITIES
BRAZIL
**
1
CEMENT
GRINDING PLANT
1
INTEGRATED
CEMENT PLANT
Global presence
We report on our performance and activities based on four
geographic regions, and separately on our joint venture in Brazil.
Principal products/
activities key:
Cement
Ready-mix concrete
Aggregates
Dry mortars
Building
blocks
Fly ash
Waste management
and alternative
fuels
Νumber of operational units of
all regions as calculated for ESG
performance reporting purposes
at Group level
* 1 facility in Canada is included.
** The joint venture in Brazil is incorporated in the financial statements using the equity
method of consolidation. In the ESG performance overview and statements, the joint venture
in Brazil is not included.
UNDERSTANDING TITAN
OVERVIEW
15
1
Egypt
2
2
1
Southeastern Europe
Integrated cement plants
1. Kosjeric – Serbia
2. Zlatna – Bulgaria
3. Sharr – Kosovo
4. Usje – North Macedonia
5. Antea – Albania
Integrated cement plants
1. Alexandria
2. Beni Suef
Eastern Mediterranean
Integrated cement plant
1. Tokat
Cement grinding plant
2. Marmara
28
READY-MIX
PLANTS
3
IMPORT
TERMINALS
1
DRY
MORTAR
PLANT
2
PROCESSED
ENGINEERED
FUEL FACILITIES
EBITDA
23.6m
REVENUE
267.6m
ASSETS
549.4m
PRINCIPAL
PRODUCTS/
ACTIVITIES
GREECE &
WESTERN EUROPE
€
1
CEMENT
GRINDING PLANT
25
QUARRIES
3
INTEGRATED
CEMENT PLANTS
PRINCIPAL PRODUCTS/
ACTIVITIES
7
READY-MIX
PLANTS
1
CEMENT
GRINDING
PLANT
13
QUARRIES
2
PROCESSED
ENGINEERED
FUEL FACILITIES
3
INTEGRATED
CEMENT
PLANTS
EBITDA
11.8m
REVENUE
172.8m
ASSETS
447.2m
€
EASTERN
MEDITERRANEAN
6
READY-MIX
PLANTS
1
PROCESSED
ENGINEERED
FUEL FACILITY
EBITDA
81.9m
REVENUE
290.6m
ASSETS
467.1m
PRINCIPAL
PRODUCTS/
ACTIVITIES
SOUTHEASTERN
EUROPE
€
20
QUARRIES
5
INTEGRATED
CEMENT PLANTS
EU Taxonomy Regulation eligible
economic activities
Turnover OpEx CapEx
% of total TITAN Group 58.6 60.5 58.9
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
Turkey
1
2
3
4
5
North Macedonia
Albania
Kosovo
Serbia
Bulgaria
16
DRIVEN BY OUR OBJECTIVES
WE DRAW ON OUR CAPITAL
TO PROVIDE OUR PRODUCTS AND SERVICES
Products
Services
and
solutions
Manufactured capital
We manufacture our products using the
best available techniques in a network of 14
integrated and three cement grinding plants
in 10 countries, as well as quarries, ready-mix
plants, and other production facilities, and
we distribute them reliably to our customers
through dedicated terminals.
Financial capital
We use our economic resources efficiently to
support our business growth and safeguard
our international competitiveness.
Intellectual capital
We use our R&D capabilities, our core
competencies, and our deep knowledge of
the building materials industry to enhance
our offerings and further improve our
performance.
Human capital
We value our people’s contribution and
continuously support their professional
development in an engaging, inclusive and
collaborative working environment.
Social and Relationship capital
We engage with our stakeholders, building
long-term relationships of trust and working
together in collaborative projects to make
a positive impact on society and local
communities.
Natural capital
We source materials responsibly, and we
preserve natural resources and biodiversity in
the areas where we operate. We contribute
to the circular economy by applying the
principles of “reduce, reuse, recycle, recover”.
Creating and sharing value
We use our capital resources efficiently to drive sustainable, long-term shared value
creation
1
, through our products and services. We help address global societal and
environmental challenges, and contribute to the attainment of the UN SDGs 2030.
Note: For terms denoted with (1)-(12) under “Creating and sharing value”, please refer to the section “ESG performance statements, 2.5.10 Notes for Value Creation Indicators”.
Cement
Ready-mix
concrete
Aggregates
Dry mortars
Building blocks
Fly ash
We foster
sustainable
solutions over
the life cycle of
our products
Production,
transportation,
distribution of
building materials
Circular economy
solutions:
• Separation
technologies
• Alternative
fuel and waste
management
solutions
We engage
with business
partners to scale
sustainability
efforts along our
value chain
UNDERSTANDING TITAN
OVERVIEW
17
Key Indicators Amounts Stakeholders SDGs 2030
Gross value added
2
€603.1m
Employees, customers, suppliers,
shareholders and investors
Net value added³
€466.7m
Employees, customers, suppliers,
shareholders and investors
Total spend on suppliers (local,
national and international) for
goods and services
4a
€1,341m
Suppliers and contractors
% local spend of TITAN
4b
65.1%
Local communities, customers
Taxes to national and local
authorities
5
€104.0m
Governments and authorities
(central and local)
Payments in cash to
shareholders and minorities
6
€32.0m
Shareholders
Total spend on donations
and community engagement
initiatives
7
€2.3m
Communities, academia and
educational and environmental
organizations, civil society, and
society at large
Investment in environmental
protection⁸
€25.3m
Communities, society at large
Alternative fuels and raw
materials
2.0m
tonnes
Communities, governments
and authorities (central and local),
society at large
Salaries, pensions (contributions)
and social benefits, including
additional benefits beyond those
provided by law
9
€309.3m
Employees and their families, local
communities
Investments in training of direct
employees¹⁰
€1.0m
Employees and their families
Internships
391
interns
Employees and their families,
local communities, youth
Investments in research and
innovation
11
€10.7m
Employees, customers, academia
and society at large
Capital expenditures
12
€126.0m
Employees, shareholders, customers,
local communities, suppliers and
contractors
AND CREATE VALUE FOR OUR STAKEHOLDERS
CONTRIBUTING TO THE UN SDGS 2030
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
18
Focusing on material issues
TITAN’s approach to sustainability is based on the principle of
double materiality assessment, an integrated, on-going process
of mapping and assessing the impact of our operations on
society and the environment, as well as the financial impacts of
socio-environmental risks on the Group. Impacts may become
material for financial reporting purposes over time, leading to
what is known as dynamic materiality assessment process.
A full cycle of materiality assessment at TITAN has a duration
of five years. We use the resulting prioritization of material
issues at local level as input for the materiality assessment
at Group level and vice versa. The latest assessment at Group
level, which was conducted in 2020, yielded nine material issues
grouped in four focus areas, all underpinned by good governance,
transparency and business ethics.
In 2021, all TITAN business units completed a new cycle of
materiality assessment, by updating their priorities following
the process established by the Group in 2020. This milestone
marks the completion of our fourth materiality assessment cycle.
The Group harmonized and further developed its materiality
assessment process in alignment with the ten principles of the
UN Global Compact and the SASB Materiality Map for our sector.
Based on this methodology, both sector-agnostic and sector-
specific material issues, as well as country-specific material
issues, were identified and are presented in Table 1 of the ESG
Statements. The issues that are most material for the majority of
our business units are: Future-ready business model in a carbon-
neutral world, safe and healthy working environment, positive
local social, economic and environmental impact, and continuous
development of our people. Following the completion of this
exercise, TITAN set and announced its ESG targets for 2025 and
beyond (see pages 20-21).
We are engaging with our stakeholders across our locations to obtain a deeper
understanding of their expectations and needs. Mapping what is most material to them and
to the business through a double materiality process helps us develop sustainable business
strategies and create value that lasts.
2
.
I
m
p
l
e
m
e
n
t
a
t
i
o
n
1
.
S
e
t
t
i
n
g
o
u
r
S
t
r
a
t
e
g
y
p
e
r
f
o
r
m
a
n
c
e
t
o
s
t
a
k
e
h
o
l
d
e
r
s
4
.
R
e
v
i
e
w
a
n
d
r
e
p
o
r
t
3
.
P
e
r
f
o
r
m
a
n
c
e
m
e
a
s
u
r
e
m
e
n
t
Sustainability
governance and
organization
Overall business
strategy
Current achieve-
ments
Double material-
ity assessment
Forward looking
progress report
against targets
Policies
and targets
Action plans
and resources
Entity as a whole
Topics
and subtopics
Sustainability
Reporting
SUSTAINABILITY REPORTING STRUCTURE
UNDERSTANDING TITAN
OVERVIEW
19
Αudience: Investors, Consumers, Civil Society, Employees
FINANCIAL MATERIALITY
ENVIRONMENTAL &
SOCIAL MATERIALITY
Climate change
impact on company
Company impact
on climate change
Understanding both the impact that climate change has on TITAN’s development, performance and position, as well as the
impact that our activities have
Double materiality assessment on climate change
Stemming from the double materiality assessment, “future-ready
business model in a carbon-neutral world” is ranked at the top
of the list of our material issues. It is related to the long-term
sustainability of the Group operations and the resilience of our
planet. TITAN is assessing climate change risks and opportunities
according to TCFD recommendations, considering a long-term
horizon and the whole value chain, as presented on page 41.
What is immaterial to a company or industry today can become
material tomorrow. Therefore, receiving regular feedback from
our stakeholders through open and structured communication
is imperative. In this context, we have designed a process
to validate the existing materiality assessment with key
stakeholders at each business unit. The outcomes of this exercise
will help us adjust our priorities, if needed, and possibly add to
our preparedness before the next materiality cycle. Through
this dynamic materiality process, we aim to build on our trusted
relationships and create shared value.
(1) Future-ready business model in a
carbon-neutral world
(2) Innovation with emphasis on
digitalization and decarbonization
(3) Safe and healthy working environment
(4) Continuous development of our people
(5) Diverse and inclusive workplace
(6) Positive local social, economic and
environmental impact
(7) Resource efficiency, recycling, and
recovery, contributing to the circular
economy
(8) Reliable and sustainable supply chain
(9) Good governance, transparency and
business ethics
Importance to stakeholders
Importance to TITAN
5
1
2
4
3
7
6
89
MATERIALITY MATRIX MATERIAL ISSUES
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
20
Decarbonization
and digitalization
Growth-enabling work
environment
All underpinned by:
Good governance, transparency and business ethics
Material issues addressed
SDGs SDGs
Material issues addressed
Targets
Ambition Ambition
Targets
We will TRANSFORM our business, focusing on
resilience, innovation and building solutions to serve
our customers more efficiently as we move towards a
carbon-neutral, digital world
We will CULTIVATE an inclusive culture with equal
opportunities for all our people to grow professionally
within a safe and healthy work environment
• Future ready business model in a carbon-neutral world
• Innovation with emphasis on digitalization and
decarbonization
• Safe and healthy working environment
• Diverse and inclusive workplace
• Continuous development of our people
1
Scope 1: direct CO₂ emissions; Scope 2: indirect CO₂ emissions from electricity; Scope 3: indirect CO₂ emissions of the supply chain
² Peer group definition: Cemex, Holcim, Argos, HeidelbergCement, CRH, Cementir, Vicat, Buzzi
³ Active wholly-owned sites
Moving ahead with ambitious
ESG targets for 2025 and beyond
Building on our strong sustainability performance over the years, in 2021 we launched our
Environmental, Social and Governance (ESG) targets for 2025 and beyond, focusing on four areas.
• we will reduce our CO₂ emissions
1
by 2030, and will
have our targets validated by the Science Based Targets
Initiative (SBTi) as follows:
• Scope 1 (net): -35% vs. 1990 level
• Scope 2: -45% vs. 2020 level
• we commit to drive down the CO₂ footprint of our
operations and products aspiring to deliver society with
carbon-neutral concrete by 2050
• we will monitor and independently verify our supply
chain (Scope 3) emissions
• we will increase our annual investment in Research and
Innovation to €20m
• we strive for zero fatalities and for an employee LTIFR
performance which consistently places us among the
three best in our peer group
2
• we will implement initiatives addressing the physical,
mental, social and financial dimensions of wellbeing for
our employees, in all countries
• we commit that 1/3 of our BoD members will be women
• we will promote equal opportunities and inclusion and
will grow by 20% the participation of women in senior
roles, talent pools and new hires
• we will offer upskilling and reskilling opportunities
to 100% of our employees, especially in areas vital
for sustainable growth, such as health and safety,
digitalization, and decarbonization
Read about our progress towards them on pages 30- 31
UNDERSTANDING TITAN
OVERVIEW
21
Positive local impact Responsible sourcing
SDGs
SDGs
Material issues addressed Material issues addressed
Ambition Ambition
Targets Targets
We will ENABLE our business operations and our
people worldwide to contribute to the prosperity of
our local communities with respect to their social and
environmental concerns
We will EMPOWER our business ecosystems to
incorporate sustainability considerations in their
business decisions and daily behaviors, while using
natural resources responsibly
• Positive local social, economic, and environmental
impact
• Resource efficiency, recycling and recovery, contributing
to the circular economy
• Reliable and sustainable supply chain
• we will sustain and further improve our strong
performance in cement production-related specific
dust, NOx and SOx emissions
• we will have quarry rehabilitation plans at 100% of our
sites
3
and will rehabilitate 25% of the affected areas
• we will have quarry biodiversity management plans at
100% of our sites
3
in high biodiversity value areas
• we will have community engagement plans that are
aligned with material issues for stakeholders and UN
SDGs 2030 at 100% of our key operations
• we will ensure that 2/3 of our total spend is directed to
local suppliers and communities
• we commit to a water consumption of 280 l/t
cementitious products and to covering 70% of our water
demand with recycled water
• we will have 85% of our production
4
covered by ISO
50001 or energy audits
• we will have 50% of our production
4
covered by “Zero
Waste to Landfill” certification
• we will ensure that 70% of our key suppliers
5
meet
TITAN ESG supplier standards
4
Production of our integrated cement plants
5
Key suppliers: critical suppliers according to the GCCA Guidance for Sustainable Supply Chain management with a meaningful level of spend for TITAN.
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
22
Working together for sustainable
development
TITAN Group is an active participant in global collaborative initiatives and international
organizations, aiming to contribute to the shaping of the sustainable world of tomorrow.
• we were among the first 500 signatories in 2002 and became a participant of the UN Global
Compact (UNGC) in 2017. We also participate in local UNGC Networks.
• we have aligned our strategy and operations with the Ten Principles on human rights, labor,
environment and anti-corruption; and take strategic actions to advance the UN Sustainable
Development Goals (SDGs), with an emphasis on collaboration and innovation.
• we submit annually the UNGC Communication on Progress (CoP) at an advanced level,
providing valuable information with transparency to our stakeholders.
Related material issues: 1, 3, 5, 6, 8, 9
• we were one of the first cement companies worldwide to have our CO₂ emissions reduction
targets validated by the Science Based Targets initiative (SBTi) as consistent with levels
required to meet the goals of the Paris Agreement.
Related material issues: 1, 2
• we have signed the “Business Ambition for 1.5°C” Commitment, a global campaign led by
the Science Based Targets initiative (SBTi), in partnership with the UN Global Compact and
the We Mean Business Coalition, joining a number of leading companies worldwide that are
committed to keeping global warming to 1.5°C and reaching net-zero emissions by 2050.
Related material issues: 1, 2
• we collaborate with the world’s most influential businesses within the nonprofit “We Mean
Business Coalition” to ensure that the world economy is on track to avoid dangerous climate
change, while delivering sustainable growth and prosperity for all.
Related material issues: 1, 2
• we participate in the “Race To Zero” global campaign led by the Science Based Targets
initiative (SBTi) in partnership with the UN Global Compact and the We Mean Business
coalition for a healthy, resilient, zero-carbon recovery that prevents future threats, creates
decent jobs, and unlocks inclusive, sustainable growth.
• it mobilizes a coalition of leading net-zero initiatives, representing 733 cities, 31 regions, 3,067
businesses, 173 of the biggest investors, and 622 higher education institutions.
Related material issues: 1, 2
UNDERSTANDING TITAN
OVERVIEW
Participations
Participations
23
• we are a member of the Global Cement and Concrete Association (GCCA) since 2018. In 2021, we
contributed to the development of the GCCA 2050 Roadmap to Net Zero Concrete “Concrete
Future”.
• in addition, we participate in the GCCA Research Network, INNOVANDI, aiming to bring forth novel
technological solutions towards decarbonization in collaboration with start-ups from across the
globe.
Related material issues: 1, 2, 3, 6, 7, 8, 9
• we became a member of CSR Europe in 2004, and a founding member of national partner
organizations. In 2021 TITAN participated in the collaborative work for:
• the “Biodiversity and Industry Collaborative Platform”, and
• the “Inclusion Think Tank”
through CSR Europe and its participation in EFRAG’s European Reporting Lab, TITAN is contributing
to the development of a New European Standard on ESG Reporting.
Related material issues: 5, 6, 9
• we participate in the Energy Transition and Climate Change Working Group of the European
Round Table for Industry to address the triggers for a successful transition towards a low carbon
economy, and thus contribute to achieving the goals of the Paris Climate Agreement.
Related material issues: 1, 2
• we participate in the European Cement Research Academy (ECRA), founded in 2003, which
supports and conducts research activities on the production of cement and its application in
concrete, aiming at advancing innovation within the context of climate change mitigation and
sustainable construction.
Related material issues: 1, 2, 4, 6, 7
Material issues:
(1) Future-ready business model in a carbon-neutral world
(2) Innovation with emphasis on digitalization and decarbonization
(3) Safe and healthy working environment
(4) Continuous development of our people
(5) Diverse and inclusive workplace
(6) Positive local social, economic and environmental impact
(7) Resource efficiency, recycling, and recovery, contributing to the circular economy
(8) Reliable and sustainable supply chain
(9) Good governance, transparency and business ethics
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
Participations
Participations
24
Kamari cement plant, Greece
24
252525
UNDERSTANDING TITAN
performance
highlights
An overview of our Group’s overall performance in 2021,
focusing on our financial and ESG pillars.
26
Financial performance
Revenue growth in all geographies and strong Group net profit (NPAT).
In 2021 the fundamentals driving demand across our markets,
namely the strong recovery of economic activity and a rise
in public and private investment against a low interest rate
environment, stimulated growth. It was a year of robust
performance for TITAN Cement Group, although the second half
of 2021 was marked by the surge in fuel, electricity and shipping
freight costs, which held back profitability.
TITAN Cement Group generated record revenues of €1,714.6
million, up 6.7% from 2020, reflecting higher demand and a
supportive pricing environment. Due to the unexpected spike of
input costs in the second semester and despite pricing initiatives
that partly alleviated the burden, Earnings Before Interest, Tax,
Depreciation and Amortization (EBITDA) declined by 3.6% to
€275.2 million. Net Profit after Taxes and minorities (NPAT)
climbed to €91.9 million (vs €1.1 million in 2020 and €50.9 million
in 2019). This significant increase was the result of lower finance
costs, more favourable FX movements and a lower effective tax
rate. It should be noted that in 2020 there were €63.9 million one-
off charges related to Egypt. Thanks to a successful refinancing
strategy the Group lowered significantly its finance costs for a
third consecutive year to €33.6 million (€19.0 million lower than
2020 and €30.0 million lower than 2019).
2021 performance highlights
TITAN’s US operations had another strong year. Benefitting
from the growth of the housing market, sales in cement, ready
mix and concrete blocks increased while sales in aggregates
were sustained at high levels. Fly ash volumes reversed the
previous year’s trend by posting significant sales growth thanks
to higher supply. Overall, in US$ terms, 2021 revenue increased
by 8.6% year on year reaching $1.2 billion. In euro terms, revenue
increased by 4.7% to €983.6 million, while EBITDA decreased to
€158.0 million, a decline of 10.5% compared to 2020 due to the
spike of energy, labor and transportation costs in the second
semester.
Greece continued its upward trajectory with further improved
performance. In 2021, higher domestic demand combined with
higher export volumes and further operational efficiencies from
the implementation of the digital optimization initiatives, were
only partially offset by the increase of fuel and electricity costs.
All in all, revenue for Greece and Western Europe increased by
9.4% to €267.6 million while EBITDA increased by €7.4 million to
€23.6 million.
Southeastern Europe continued its ascending track as well,
recording increased revenues of 7.3% at €290.6 million. During
2021 both cement plants in Albania and in North Macedonia
achieved a new record, exceeding sales of 1 million tonnes. On
the other hand, electricity and energy costs rose sharply after the
second quarter of the year, resulting in an EBITDA of €81.9 million,
lower by 14.8%.
Despite the macroeconomic uncertainties in the Eastern
Mediterranean region, performance marked a material
improvement year on year. In Egypt, the rationalized production
regime implemented by the authorities improved the cement
supply-demand balance and drove pricing to healthier levels. In
Turkey, despite the slowdown of the economic activity and the
pronounced volatility of the currency, domestic demand remained
high. Following few years of weak performance and despite the
macroeconomic uncertainties, the Eastern Mediterranean region
recorded total revenue of €172.8 million, an increase of 13.9% from
2020. EBITDA was €11.8 million versus a €3.3 million loss in 2020.
Finally, our Brazilian operations continued to grow significantly.
Increased sales volumes thanks to strong market
fundamentals
Trends in domestic sales volumes were positive across all regions,
testifying to strong market fundamentals. At Group level, volumes
increased across all product lines: cement, ready-mix concrete,
aggregates, building blocks and fly ash.
Group cement sales increased by 7% compared to 2020, reaching
18.3 million tonnes, with US being the main contributor of this
increase. Ready-mix concrete sales increased by 2% in 2021,
reaching 5.5 million m
3
on the back of stronger sales in US and
Greece. Aggregates' sales increased by 1% reaching 20.2 million
tonnes, thanks to the strength of the Greek market.
2021 2020 +/-
Cement (million metric tonnes)* 18.3 17.1 7%
Ready-Mix concrete (million m
3
)** 5.5 5.4 2%
Aggregates (million metric tonnes) 20.2 20.0 1%
*Cement sales include clinker and cementitious materials
**Includes Brazil, does not include Associates
Investments and Operating Free Cash Flow
In 2021, Group Operating Free Cash Flow reached €104.7 million
versus €225.3 million in 2020. Lower OFCF was primarily due to
higher capital expenditures by €41.8 million from the catch-up
of the 2020 COVID-19 -restrained investment program, higher
working capital needs by €48.9 million resulting from stronger
business activity and higher levels of fuel inventories. Group
capital expenditures during the year reached €126.0 million
compared to €84.3 million in 2020, with most of the funding
directed to investments focusing on production efficiencies,
improved logistics capacities and reduction of carbon footprint.
Moreover, the final tranche of €40.8 million were paid to IFC
for the acquisition of their minority stakes held in the Group's
activities in Southeastern Europe and Egypt.
2021 2020 2019
Operating free cash flow €104.7m €225.3m €175.1m
Capital expenditure €126.0m €84.3m €109.3m
Net debt at the year end €713.2m €684.4m €839.6m
UNDERSTANDING TITAN
PERFORMANCE HIGHLIGHTS
27
Group Leverage
Year-end net debt increased to €713.2 million (2020: €684.4
million), following the repayment of a €163.5 million outstanding
bond and the conscious reduction of cash balances. Net Debt/
EBITDA ratio came at 2.61x.
To diversify its funding base, TITAN Group uses a variety of funding
sources and debt instruments that combine long-term and short-
term financing. At year end, 75% of Group debt was in bonds, 17%
in bank loans and 8% in lease liabilities.
In the prevailing low interest environment, the Group took a
number of initiatives and succeeded in both lowering its finance
costs and extending the debt maturity profile. In June 2021, TITAN
paid back the remaining €163.5 million of the originally €300
million Notes issued in 2016. The next significant maturities are
one issue of €350 million maturing in November 2024 and another
issue of €250 million maturing in July 2027. Both outstanding
bonds are traded on the Global Exchange Market (GEM), which is
the exchange-regulated market of Euronext Dublin.
In December 2021, Standard & Poor’s affirmed its rating for Titan
Cement International S.A. of “BB” with a stable outlook.
Outstanding bonds
ISIN
Amount
Outstanding
Coupon Maturity
XS2199268470 250,000,000 2.750% 09/07/2027
XS1716212243 350,000,000 2.375% 16/11/2024
Resolutions of the Board of Directors
• Cancellation of treasury shares: In June 2021, TITAN Group
cancelled 4,122,393 own shares, representing 5% of the voting
rights. Following this transaction, the share capital of Titan
Cement International amounts to €1,159,347,807.86 and is
represented by 78,325,475 shares.
• Share buy-back: In October 2021, following the Board’s decision,
the Group activated a share buy-back program of an amount up
to €10 million for a duration of up to six months. Until the end
of 2021, 230,141 shares were purchased on Euronext Brussels
and the Athens Exchange (ATHEX) for a total consideration of
€3.2 million. On 31 December, the Group owned treasury shares
representing 1.91% of the voting rights.
• Initiation of a new share buy-back programme: In March 2022,
given the latest market developments, the Board decided
to implement a new share buy-back programme. The new
programme will begin on or around April 1, 2022, following the
end of the current running programme. The new share buy-back
programme will be up to €10 million and will have a duration
of up to six months. TCI will keep the market fully informed of
the progress of the relevant transactions in line with applicable
regulations.
• Return of Capital: Following the authorization granted to
the Board of Directors by the Extraordinary Meeting of the
Company's Shareholders on 13 May 2019, the Board decided the
return of capital of €0.50 per share to all the Shareholders of the
Company. All shareholders who are recorded as shareholders on
Thursday, 28 April 2022, at 12.00 midnight (CEST) (record date)
will be entitled to receive the capital return. Shareholders will
receive the payment of the capital return on Tuesday, 5 July
2022, through their custodians, banks, and securities brokers.
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
0
50
100
150
200
250
300
350
400
<Dec '21
<Dec '22
<Dec '23
<Dec '24
<Dec '25
<Dec '26
<Dec '27
>Dec '27
4
7
1
6
5
6
8
16
6
100
14
364
252
33
8
16
247
348
2
8
6
84
6
Bank debt Bond Leases
28
DEBT MATURITY PROFILE (€m) AS OF 31 DECEMBER 2021
28
TITAN Cement Company S.A. was founded in 1902 in Athens,
Greece and its shares were listed on the Athens Exchange in 1912.
In June 2019 following a successful share exchange tender offer,
Titan Cement International (“TCI”) became TITAN Cement Group’s
parent company. TCI is listed in Euronext Brussels (primary listing)
as well as in the Athens Exchange and in Euronext Paris. Aiming to
enhance value for its shareholders, Titan Cement Group decided
to cancel treasury stock of 4,122,939 own shares corresponding to
5% of the total shares of TCI on June 22nd, 2021. Therefore, since
then the total number of outstanding shares of TCI was 78,325,475.
TCI’s shares are included in various indices, such as the BEL Mid
Cap Index and the FTSE/ATHEX Large Cap. Moreover, TCI shares
are constituents of the BEL Industrials, BEL Continuous, BEL ALL-
Shares, ATHEX Composite, MSCI Greece Small Cap, CAC All-Shares
and CAC industrials indices. Furthermore, TCI shares were also
included in the ATHEX ESG index that was launched in August
2021. The ATHEX ESG Index tracks the financial performance of
companies listed in the Athens Exchange who adopt and actively
promote ESG practices.
Share price evolution
The share price of TCI as of December 31
st
, 2021, closed at €13.26
on Euronext and at €13.38 on the Athens Exchange, corresponding
to a decline of 4.4% and 2.6% year on year respectively. In 2021,
the BEL Mid cap Index and the ATHEX General Index, increased by
21% and 10%, respectively. As of December 31
st
, 2021, TCI’s market
capitalization stood at €1.05 billion (previous year at €1.1 billion).
Liquidity and market making contracts
Targeting an enhancement of liquidity for its shares in both
exchanges, TCI partners with liquidity providers and market
makers. At the end of 2020 TCI signed a liquidity provider
agreement for its shares on Euronext with KBC Securities and
a market maker agreement for its shares traded on the Athens
Exchange with Eurobank Equities. In early 2021 Piraeus Securities
was added as a second market maker in the Athens Exchange.
ESG investors
Titan Cement International is committed to sustainable
development and focuses its efforts on the four pillars defined
as material by its stakeholders to meet its ESG targets for
2025 and beyond. TCI aligns its targets with the expectations
of its stakeholders, follows best practices and continuously
seeks feedback from independent ESG rating agencies. Since
2010, ΤΙΤΑΝ Cement Group has attained and maintained
the “Advanced” level reporter status in line with United
Nations Global Compact principles. During 2021, TCI has been
assessed multiple times by various rating agencies on its ESG
performance, achieving very positive results. Amongst other
ratings, TCI achieved an improved rating of “AA” from MSCI ESG
Research (versus “A” in 2020) and a “A-” score from CDP.
Details on ESG ratings for TCI, can be found on page 29.
Equity market information
TITAN Cement Group is committed to maintaining relationships of trust with the
investment community.
Treasury shares
In October 2021, the Group activated a share buy-back programme.
By the end of 2021, 230,141 shares were acquired for an amount of
€3.2 million. At the end of 2021, treasury shares represented 1.91%
of total voting rights.
For more information please refer to the “Financial review” section
on page 27.
Shareholder structure of TCI
Below you can find the shareholder structure of the Company as of
December 31st, 2021*:
• E.D.Y.V.E.M. Public Company Ltd and TCI founders acting in
concert 39.12%
• Paul and Alexandra Canellopoulos Foundation 10.17%
• FMR LLC, FMR CO Inc, Fidelity Institutional Asset
Management Trust Company, FIAM LLC 10.53%
• Others 40.18%
* Based on the transparency notifications made by its shareholders on 24 June
2021 and on changes in shares that did not require a transparency declaration
due to the fact that the 5% threshold was not exceeded either upwards or
downwards.
Data for FMR LCC are based on the transparency notifications made on 24 June
2021.
GEOGRAPHIC SPLIT OF TCI'S SHRAREHOLDER STRUCTURE
Europe 69%
USA & Canada 15%
UK & Ireland 3%
Rest of the world 13%
Source: Shareholder ID and company estimates
Symbols
Euronext ATHEX
Oasis TITC TITC
Reuters ticker TITC.BR TITC.PA
Bloomberg ticker TITC.BB TITC.GA
ISIN code: BE0974338700
UNDERSTANDING TITAN
PERFORMANCE HIGHLIGHTS
29
ESG performance acknowledged by
world-leading rating agencies
We are committed to continuously improving our sustainability performance and further
aligning our targets with the expectations of our stakeholders. To this end, we seek and
value feedback from independent ESG rating agencies.
In 2021, TITAN was recognized by the CDP as a global climate leader for its transparency, climate actions and
transition to a net zero carbon economy. With an “A-” score, TITAN was ranked in the top 15% of publicly
disclosing companies globally, being one of only five cement sector companies (out of 27) to achieve this level.
TITAN received an MSCI ESG Rating of “AA”. MSCI ESG Research provides ESG Ratings on global public and a few
private companies on a scale of AAA (leader) to CCC (laggard).*
TITAN was ranked 10
th
in the construction materials sector across Europe and America, with a “B+” score by
Refinitiv.
TITAN received an improved ESG Risk Rating of 27.9 and was assessed by Sustainalytics to be at medium risk
of experiencing material financial impacts from ESG factors. The score places us 16
th
out of 119 construction
materials companies.
TITAN was ranked 5
th
out of 25 in the building materials’ sector by V.E., part of Moody’s ESG Solutions, with an
ESG overall score of 56/100. The Group was assessed to have a robust ESG performance and a high reporting
rate (90%) compared to the sector average (75%).
In the ISS ESG Corporate Rating, TITAN was assessed as a company with a very high transparency level and
received an overall rating of “C” with a decile rank of 2, indicating a high relative ESG performance in its
industry group.
TITAN received a score of 54 in the 2021 S&P Global Corporate Sustainability Assessment, reflecting an
improvement of 22 points over the previous year.
* Disclaimer statement. The use by Titan Cement International S.A. of any MSCI ESG research llc or its affiliates (“MSCI”) data, and the use of MSCI logos, trademarks, service marks or index
names herein, do not constitute a sponsorship, endorsement, recommendation, or promotion of Titan Cement International by MSCI. MSCI services and data are the property of MSCI or its
information providers, and are provided ‘as-is’ and without warranty. MSCI names and logos are trademarks or service marks of MSCI.
Disclaimer:
All logos, trademarks, service marks or index names used in this website are the property of their respective owners and are used for informational purposes only. The use of the such logos,
trademarks, service marks or index names in this website does not constitute a sponsorship, endorsement, recommendation, or promotion of Titan Cement International S.A. or any of its
subsidiaries by any of the respective owners of the logos, trademarks, service marks or index names.
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
S&P
Global Ratings
30
In 2021 we recorded substantial progress towards our ESG targets, demonstrating our
strong commitment to sustainability and long-term value creation for our customers,
local communities, employees and other stakeholders.
Targets 2025 and beyond 2020 2021
annual
progress
Decarbonization and digitalization
SBTi validation - Targets validated
Scope 1
1
Reduction of our net CO₂ emissions
to 500kg/t cementitious product (-35.0% vs. 1990 level)
674.0
(-13.4% vs. 1990)
654.2
(-16.0% vs. 1990)
Scope 1
1
Reduction of our gross CO
2
emissions
to 553kg/t cementitious product (-20.7% vs. 2020 level)
697.9
681.9
(-2.3% vs. 2020)
Scope 2
1
Reduction of our CO₂ emissions
to 32kg/t cementitious products (-45.0% vs. 2020 level)
61.0
51.5
(-15.6% vs 2020 level)
Monitoring and independent verification of supply chain
(Scope 3)
2
emissions (kgCO₂/t cementious product)
116.8
103.4
Scope 3 emissions verified
by independent auditor
We commit to drive down the CO₂ footprint of our operations and
products aspiring to deliver society with carbon-neutral concrete
by 2050
Business Ambition for 1.5
o
C
commitment letter signed
Increase annual investment in Research and Innovation to €20m 10.5 10.7
Growth enabling work environment
Zero Fatalities 3 0
LTI frequency rate (employees) performance among the three
best in peer group
3
0.57 0.91
Wellbeing initiatives, addressing the physical, mental, social
and financial dimensions of wellbeing for our employees, in all
countries
43 118
1/3 female participation in BoD (%) 21.0 20.0
Promote equal
opportunities and
inclusion and increase
by 20% female
participation in senior
roles, talent pools and
new hires
% women participation
in management
16.5 17.6
% women in senior management
14.0 14.7
% women
in new hires
13.4 17.2
100% of employees with access to upskilling and reskilling
opportunities, especially in areas vital for sustainable growth,
such as health and safety, digitalization, and decarbonization.
Learning hours in health and safety and digital
increased by 38% and 251% respectively
ESG PERFORMANCE
Making progress towards
our ESG targets
UNDERSTANDING TITAN
PERFORMANCE HIGHLIGHTS
31
1
Scope 1: direct CO₂ emissions (net); Scope 2: indirect CO₂ emissions from electricity.
2
Scope 3: indirect CO₂ emissions of the supply chain related to six categories considered relevant to cement production activities according to GCCA guidance.
3
Frequency of Lost Time Injuries (LTIFR) per million worked hours. Peer group definition: Cemex, Holcim, Argos, HeidelbergCement, CRH, Cementir, Vicat, Buzzi.
Comparison based on latest available information.
4
Active wholly-owned sites
5
Integrated cement plants
6
Key suppliers: critical ones according to GCCA Guidance for Sustainable Supply Chain management with a meaningful level of spend for TITAN.
Positive local impact
targets 2025 and beyond 2020 2021
annual
progress
Sustain and further improve
strong performance in cement
production-related specific
dust, NOx and SOx emissions
Dust emissions
(g/t clinker)
19.3
16.6
NOx emissions
(g/t clinker)
1,282 1,263
SOx emissions
(g/t clinker)
253
245
100% of sites
4
with quarry rehabilitation plans
91
91
Rehabilitation of 25% of affected areas
23.6 22.6
Quarry biodiversity management plans at 100% of our sites
4
in
high biodiversity value areas
90.0 83.0
100% of key operations covered with community engagement
plans (CEP), aligned with material issues and UN SDGs 2030
All key operations
covered by 124
initiatives
• All key operations
covered by 142 initiatives
• New CEP guidance
framework
2/3 of total spend directed to local suppliers and communities (%) 67.0 65.1
Responsible sourcing
Commit to a water consumption of 280l/t cementitious product
260.5
245.7
70% of water demand covered by recycled water 67.2 66.1
85% of production
5
covered by ISO 50001 or energy audits 54.9 86.2
50% of production
5
covered by “Zero Waste to Landfill”
certification
29.5 56.2
70% of key suppliers
6
meeting TITAN ESG supplier standards • Sustainable Supply Chain Roadmap
• New Group Procurement Policy in 2021
• ESG criteria to evaluate key suppliers
Progress key:
Achieved
On track
In progress
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
32
Delivering on our ambitions with
concrete actions
Decarbonization and digitalization
TITAN seeks to transform its business, focusing on resilience,
innovation and building solutions to serve our customers more
efficiently as we move towards a carbon-neutral, digital world.
Αs a signatory to the “Business Ambition for 1.5°C” commitment,
a worldwide campaign led by the Science Based Targets initiative
(SBTi), TITAN is committed to playing its part to limit global
warming to 1.5°C and to reach net-zero emissions by 2050. By
increasing the use of alternative fuels, accelerating our efforts in
energy efficiency, developing low-carbon products and adopting
innovative technologies and solutions, we further improved our
performance to meet the ESG targets we have set for 2025 and
beyond. In 2021, we reduced our specific emissions to 654.2kg CO₂
per tonne of cementitious product, 16.0% below 1990 levels.
Following an investment of ca. €20 million across several TITAN
plants in alternative fuel processing facilities and in feeding and
combustion infrastructure in the USA, Bulgaria, Greece and North
Macedonia, our alternative fuel thermal substitution rate grew to
15.5% in 2021, from 13.1% in 2020.
We further reduced the carbon footprint of our products by
shifting to lower-carbon cements in the USA, Greece, Egypt and
North Macedonia. Meanwhile, since September, approximately
half of Titan America’s cement output consists of the lower-carbon
Type IL cement, which has almost 15% lower carbon emissions.
Also, the Kamari plant in Greece has expanded its export product
portfolio to include Type IL to meet US market demand for
sustainable construction materials.
We also reduced our Scope 2 emissions by 15.6% in 2021, bringing
them to 51.5kg CO₂ per tonne of cementitious product due to
our energy efficiency measures and the decarbonization of
national power generation. In order to measure our Scope 3
emissions, we ran a full-scale exercise covering 13 integrated and
2 grinding cement plants. Scope 3 emissions represent 12.2% of
total emissions and equal 103.4kg CO₂ per tonne of cementitious
product.
Through our participation in the Open Innovation Challenge of the
Global Cement and Concrete Association (GCCA), we continued
to contribute to the research activity of the GCCA’s Innovandi
research network. We are experimenting with the use of hydrogen
as a fuel enhancer in cement clinker manufacturing and have run
industrial pilots in Greece and Bulgaria.
With tangible progress on all focus areas, we are well on track to achieve all our ESG targets
for 2025 and beyond.
ESG PERFORMANCE
% heat basis
0%
5%
10%
15%
20%
2016 2017 2018 2019 2020 2021
15.5%
13.1%
13.5%
12%
8.9%
8.4%
ALTERNATIVE FUEL SUBSTITUTION RATE
OUR CARBON FOOTPRINT IN 2021
Scope 1: 81.6%
Scope 3: 12.2%
Scope 2: 6,2%
31.2 million t
Avoided (direct net) CO₂ emissions (1990-2021)
kg/t cementitious product
620
640
660
680
700
720
2016 2017 2018 2019 2020 2021
654.2
674.0
676.6
686.1
700.3
701.4
SPECIFIC NET DIRECT CO2 Scope 1)
UNDERSTANDING TITAN
PERFORMANCE HIGHLIGHTS
33
In 2021, TITAN Group worked on identifying and assessing the risks
from climate change, and the opportunities from the transition to
a low-carbon economy, in alignment with the TCFD Framework.
We were recognized by the CDP (formerly Carbon Disclosure
Project) as a global climate leader for our transparency and actions
to mitigate climate change and transition to a net-zero economy
with an “A-” score.
In the related field of digitalization, we see big data, analytics
and artificial intelligence (AI) of Industry 4.0 as an opportunity
to transform the industry. In 2021, our Group Digital Center of
Competence continued the rollout of existing AI-based Real
Time Optimizer solutions in plants in the USA, Greece, Brazil and
Southeastern Europe, leading to increased productivity and energy
efficiency. We also rolled out a machine learning-based failure
prediction system in plants in the USA, Egypt and Southeastern
Europe.
We continued to develop AI-based tools and proprietary tools for
forecasting sales demand as well as selected production inputs.
To improve customer experience and create a more efficient
commercial operating model, we worked on digitalizing how
we interact with our customers, deploying digital customer
applications in business units in the USA and Europe.
We support a digital transformation journey through internal and
external capability-building efforts and by creating an ecosystem
of partners comprising start-ups, academic institutions,
equipment and systems manufacturers and specialized advisers.
Group annual investment in Research and Innovation with
emphasis on digitalization and decarbonization stood at €10.7m in
2021.
Growth-enabling work environment
Core to our purpose is the cultivation of an inclusive culture with
equal opportunities for all our people to grow professionally within
a safe and healthy work environment.
In 2021, safeguarding our people and operations against COVID-19
remained our priority. We responded to the challenge of the
pandemic across all regions, with more than 13 initiatives in 7
countries to combat the impact on our employees and business
partners as well as to provide humanitarian support to local
communities. We launched information campaigns on vaccination
and encouraged our employees to get immunized, covering the
cost for more than 1,500 employees and contractors in the USA,
Egypt, Albania and North Macedonia.
Guided by our Group Health and Safety policy, we systematically
strengthened our accident prevention and health promotion
systems in all production and distribution operations. In Europe,
Turkey and Egypt, all of the cement plants and more than 83% of
the combined ready-mix concrete and aggregates plants are now
certified to the ISO 45001 standard, which has replaced OHSAS
18001. In the USA, all TITAN activities conform to the requirements
of the relevant OHS organizations.
Lost Time Injuries Frequency (LTIFR) for our own personnel was
0.91 LTI per million hours worked. While slightly higher than in
2020 (0.57 LTIs per million hours worked), the figure remains
consistent with the continuous improvement that began in 2017
(LTIFR 2.41) and has yielded an overall reduction of 62% that places
us among the best in our peer group. There were no fatalities.
Living up to our commitment to implement initiatives for the
physical, mental, social and financial wellbeing of our people,
0
0.5
1.0
1.5
2.0
2.5
3.0
2016 2017 2018 2019 2020 2021
0.91
0.57
1.44
1.54
2.41
1.92
#/10⁶ h
0
20
40
60
80
100
120
2016 2017 2018 2019 2020 2021
38.1
24.1
57.4
55.7
109.0
78.2
EMPLOYEE LOST TIME INJURIES SEVERITY RATE
d/10⁶ h
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
34
to their social and environmental concerns is a major pillar of our
ESG targets and a field where TITAN has always demonstrated
strong performance.
In all our plants, management systems monitor and report on the
reduction of air emissions, the protection of biodiversity, water
management and recycling and quarry rehabilitation. Across the
group, we maintained a strong performance in reducing cement
production-related dust, NOx and SOx emissions, which were
within the target set for 2025.
The percentage of active quarry sites with rehabilitation plans
remained at the same level as last year. Furthermore, the
percentage of quarry land areas rehabilitated out of the total
affected land was slightly reduced. Although there was progress
with the rehabilitation activities in most of our Group Quarries,
this has not been reflected in the relevant indicator due to the
opening of a large land area in one aggregates quarry in Titan
America. However, the rehabilitation activities will continue in
the following years so as to achieve the respective ESG targets
for 2025. Finally, the number of the active quarry sites with
biodiversity management plans increased to 10, following the
completion of the plan at Agrinio quarry in Greece. The focus is
now to develop biodiversity management plans at the two new
sites recognized for their high biodiversity value, in order to meet
the respective ESG target for 2025.
Our community engagement plans (CEP) were aligned with the
material issues for our stakeholders and the UN SDGs 2030. We
implemented 142 initiatives in all countries of operation, which
we launched a Group-wide mental health campaign to raise
awareness and promote good mental health. Individual business
units provided a variety of programs to their employees, from
cyber and live expert talks, smoking cessation programs, and
nutritional support classes to virtual exercise sessions.
The recognition that achieving our aspirations for diversity and
inclusion requires the awareness, action, responsibility and
accountability of everyone in our business is at the foundation of
our Group Diversity, Equity and Inclusion Policy, launched in 2022.
The share of women in management increased to 17.6 in 2021 from
16.5 in 2020. The Group is on track to increase the participation of
women in senior roles, talent pools and new hires by 20% by 2025.
Investment in upskilling our people and building the required
capabilities needed for long-term growth continued. Due to
COVID-19 restrictions, our efforts focused on ensuring digital
training reached all targeted audiences. Our e-learning offerings
increased to 11,233 virtual training hours in 2021, corresponding to
214 courses. Total learning hours in health and safety and digital
increased by 38% and 251% respectively.
Our external learning platform provides employees with a vast
choice in acquiring knowledge and building skills. 97% of the
available LinkedΙn learning licenses have been activated, resulting
in the completion of attendance of nearly 29,000 learning videos
by almost 980 employees.
Positive local impact
Enabling our business operations and our people worldwide to
contribute to the prosperity of our local communities with respect
g/t clinker
1,000
1,200
1,400
1,600
1,800
2,000
2016 2017 2018 2019 2020 2021
1,263
1,282
1,269
1,307
1,345
1,709
SPECIFIC NO
€ 25.3m
Investments in environmental protection in 2021
65,132t
Avoided dust emissions (2003-2021)
2016 2017 2018 2019 2020 2021
83%83%83%
81%
80%
81%
75%
77%
79%
81%
83%
85%
UNDERSTANDING TITAN
PERFORMANCE HIGHLIGHTS
35
saw the engagement of more than 2,750 participants, of whom
almost 2,000 were TITAN employees. The CEPs benefitted,
directly and indirectly, more than 0.4 million people in the
local and broader communities around our operations. We also
ensured that two-thirds of our total spend was directed to local
suppliers and communities, thus further enhancing our positive
local impact. In total, our 2021 local spend accounted for 65.1% of
total spending, close to the level of 2020.
Responsible sourcing
We are committed to the circular economy, taking actions to
minimize, reuse, recycle or recover materials and energy in order
to preserve natural resources, reduce CO₂ emissions and manage
waste efficiently.
In 2021, specific water consumption at our cement and grinding
plants and their attached quarries showed a reduction of approx.
6%, reaching 245.7l per tonne of cementitious product, which is
well below the target set for 2025. In addition, use of recycled
water over total water demand decreased slightly to 66.1%, but is
is still on track to reach the respective target for 2025.
We also continued to expand the use of energy-efficiency
management systems, with our plants in Alexandria and Beni
Suef in Egypt and Usje in North Macedonia successfully installing
systems certified according to ISO 50001:2018. As a result,
86.2% of our total clinker production is now covered by ISO
50001, exceeding the 2025 target of 85.0% and marking a 54.9%
improvement from last year.
Steady progress was made to reduce landfill waste. Our cement
plants in Greece (Kamari, Patras and Thessaloniki) obtained
“Zero Waste to Landfill” certification – and the highest Platinum
rating – for diverting virtually all plant waste from landfill. As a
result, 56.2% of our total clinker production is now covered by
“Zero Waste to Landfill” certification, exceeding the 2025 target
of 50.0% and showing an increase of 29.5% from 2020.
To empower our business ecosystems to incorporate
sustainability considerations in their business decisions and daily
behaviors, a Sustainable Supply Chain Roadmap was developed
with specific milestones to ensure that 70% of our key suppliers
meet TITAN ESG Supplier standards by 2025. As a first step and
in line with the roadmap, our first TITAN Group Procurement
Policy was published, laying down the fundamental principles
governing procurement, incorporating practices that enhance
our commitment to be a socially responsible, ethical and
environmentally sensitive enterprise. Our efforts to engage with
our suppliers on climate change have been recognized by CDP
with an “A-” score in the CDP Supplier Engagement rating, which
is in the Leadership band of CDP.
36.3 million m³
Avoided water consumption (2003-2021)
86.2%
of the Group’s total clinker production capacity
covered by ISO 50001
% Dry
0%
2%
4%
6%
8%
2016 2017 2018 2019 2020 2021
6.6%
6.4%
7.1%
5.5%
5.4%
5.1%
ALTERNATIVE RAW MATERIALS USE
2,750 participants
in 142 community engagement initiatives
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
36
Through sound corporate governance, we aim to ensure that every management decision
is aligned with our purpose and core values, takes due account of our sustainability
considerations and serves the best interests of our stakeholders. By proactively identifying,
assessing and managing all our potentially significant risks and opportunities, we ensure
that we are prepared to achieve our strategic objectives and address issues that may affect
the long-term sustainability of our business.
UNDERSTANDING TITAN
PERFORMANCE HIGHLIGHTS
ESG PERFORMANCE
Legal structure of Titan Cement International S.A.
Titan Cement International S.A. (TITAN or the Company) is a public
limited liability company (société anonyme) incorporated under
Belgian law. Its shares are listed on the regulated markets of
Euronext Brussels, Euronext Paris and the Athens Exchange. The
seat of the management of the Company is in Cyprus.
Governance structure
TITAN has a one-tier governance structure, consisting of the Board
of Directors, which is authorized to carry out all actions that are
necessary or useful to achieve the company’s purpose, except for
those which only the General Meeting of Shareholders is legally
authorized to carry out. At least once every five years, the Board
of Directors reviews whether the chosen governance structure
remains appropriate.
Board of Directors
The Company’s Board is currently composed of 15 directors.
The Board members have high-level, diverse and complementary
expertise, and significant experience relevant to the main
challenges that TITAN faces in its business environment and
key markets. The Board members bring their experience and
competence in many areas including finance, international
investments, engineering, technology, business administration,
sustainability, strategic planning, banking, legal/regulatory
matters, insurance, audit, energy, politics, government and
foreign affairs, as well as their broader perspective on society and
the world.
The Board’s role
Our Board, as a collegial body, pursues sustainable value creation
by setting the Company’s strategy, putting in place effective,
responsible and ethical leadership, and monitoring the Company’s
performance. To effectively pursue such sustainable value
creation, the Board has developed an inclusive approach that
balances the legitimate interests and expectations of shareholders
and other stakeholders. The Board appoints the executive
management and constructively challenges the executive
management when appropriate.
Management Committee
The Management Committee is composed of the Managing
Director of the Company and other members appointed and
removed by the Board of Directors. Its main role is to support
the Managing Director in the day-to-day management of the
Company.
Group Executive Committee
The Group Executive Committee (ExCo) consists of the following
members:
• Dimitri Papalexopoulos, Chair
• Alexandra Papalexopoulou, Deputy Chair
• Michael Colakides, Managing Director and Group CFO
• Leonidas Canellopoulos, Group Chief Sustainability Officer
• Michael Chivers, Group Human Resources Director
• Antonis Kyrkos, Group Transformation and Strategic Planning
Director
• Yanni Paniaras, Group Executive Director Europe and
Sustainability
• Christos Panagopoulos, Regional Director Eastern
Mediterranean
• Fokion Tasoulas, Group Innovation and Technology Director
• Bill Zarkalis, Group COO, President and CEO of Titan America LLC
The role of the Group Executive Committee is to facilitate:
• cooperation and coordination of the Company’s subsidiaries
• supervision of Group operations
• monitoring of Group management performance
• implementation of decisions and related accountability
Good governance, transparency
and business ethics
37
Efstratios-Georgios (Takis) Arapoglou
Chairman
Chair of Nomination Committee
Non-executive Director
Kyriacos Riris
Vice-Chairman
Chair of Audit and Risk Committee
Independent Director
Dimitri Papalexopoulos
Chair of the Group Executive Committee
Executive Director
Michael Colakides
Managing Director and Group CFO
Executive Director
William Antholis
Member of Remuneration Committee
Independent Director
Andreas Artemis
Member of Nomination Committee
Independent Director
Leonidas Canellopoulos
Chief Sustainability Officer
Executive Director
Harry David
Member of Audit and Risk Committee
Independent Director
Lyn Grobler *
(since 31 December 2021)
Member of Nomination Committee
Independent Director
Yanni Paniaras
Group Executive Director Europe and Sustainability
Executive Director
Alexandra Papalexopoulou
Deputy Chair of the Group Executive Committee
Executive Director
Stelios Triantafyllides
Member of Remuneration Committee
Independent Director
Dimitris Tsitsiragos
Member of Audit and Risk Committee
Independent Director
Bill Zarkalis
Chief Operating Officer
President and CEO of Titan America LLC
Executive Director
Mona Zulficar
Chair of Remuneration Committee
Independent Director
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
Other Board committees
The Board, in order to discharge its duties effectively and
efficiently, has set up specialized committees to analyze specific
issues and provide relevant advice. Without prejudice to its right
to set up other committees, the Board has established the:
• Audit and Risk Committee, comprised entirely of independent
directors
• Remuneration Committee, comprised entirely of independent
directors
• Nomination Committee, comprised of two independent directors
and chaired by the Chairman of the Board, who is a non-
executive director
The Board ensures that each committee has a balanced
composition and has the necessary independence, skills,
knowledge, experience and capacity to execute its duties
effectively.
699.05%3/15
Directors
are female
8/15
Directors are
independent
9/15
Directors are
non-executive
Board attendance
Different nationalities
represented on the Board
(US, Egypt, UK, Cyprus, Greece,
South Africa)
* Maria Vassalou served as Independent Director and member of the Nomination Committee until 31 December 2021.
Titan Cement International S.A. Board of Directors:
38
Sustainability governance
Sustainability is embedded firmly in our strategy through the
regular review of all issues that are material to the business
and our stakeholders, the definition of appropriate actions
and targets, and the adherence to environmental, social and
governance policies. Our two governance bodies, the Board of
Directors and the Group Executive Committee, oversee the
implementation of our strategy and sustainability imperatives
and reflect the culture of good governance, transparency and
business ethics that is prevalent across the Group.
ExCo Sustainability Committee
Chair: Chairman of the Group Executive Committee
Convener: Chief Sustainability Officer
The Group Executive Committee, acknowledging sustainability
as a top priority of the Company, has set up an ExCo
Sustainability Committee comprised of Executive Directors of
the Company, the Group ESG Performance Director and other
senior managers of the Group depending on the agenda.
TITAN’s Executive Sustainability Committee is convened by
the Chief Sustainability Officer to monitor performance and
implementation of the sustainability strategy set by the Board.
In particular, its role is to:
• oversee and monitor the implementation of the Company’s
sustainability strategy
• monitor performance vs. ESG targets and
• decide on corrective actions, review and revise the areas
of focus, set appropriate targets dynamically reviewing the
corporate materiality assessment
Sustainability Working Group (SWG)
Chair: Chief Sustainability Officer
Convener: Group ESG Performance Director
The Sustainability Working Group SWG is responsible for
supporting the coordination of the Group sustainability agenda
and the relevant decision-making at both Group and regional
level. The main responsibilities of the SWG are to:
• develop and prepare specific proposals related to the Group
Sustainability Agenda
• cascade targets internally through different functions and
business units
• coordinate TITAN’s partnerships with international
organizations, networks and initiatives
Group ESG performance department
The role of the Group ESG Performance department is to
consolidate, coordinate and monitor the sustainability actions
undertaken across the Group, ensuring that we collectively
deliver the best possible results against well-defined ESG
criteria. It does so through a network, which consists of ESG
liaison delegates from every business unit and coordinates the
implementation of sustainability commitments at regional level.
Introducing ESG criteria in executive Remuneration
TITAN recognizes that linking environmental, social and
governance (ESG) performance to executive pay can help hold
executive management to account for the delivery of the
Group’s ESG targets, while strengthening the oversight of the
sustainability agenda at Board level.
As per the Group’s remuneration policy, a three-year CO₂ target
that is compatible with the Group’s 2030 CO₂ targets is included
in the performance objectives of the deferred compensation
incentive for executive members of the Board and the members
of the Executive Committee. In addition, 5% of the Short-
term Incentive Scheme (STIP) is linked to the Lost Time Injury
Frequency Rate.
Group policies and Code of Conduct
To ensure that we conduct our business with respect,
accountability and responsibility, we have developed our
Code of Conduct and Group Policies, applicable to all Group
operations, which cover all strategic areas and provide guidelines
to employees and external business collaborators, to ensure
compliance with the applicable internal and statutory rules.
Group Policies include, but are not limited to, Anti-Bribery and
Corruption, Conflict of Interest, Competition Law, Sanctions,
Corporate Social Responsibility, Whistleblowing, Environmental
and Climate mitigation, Protection of Personal Data, Human
Rights, Occupational Health and Safety. In 2021, we launched
a new Procurement policy and at the beginning of 2022, we
launched a new Diversity, Equity and Inclusion policy. All our
policies are available on the Group corporate website (https://
www.titan-cement.com/about-us/corporate-governance/group-
policies/).
Male: 17
Female: 21
ESG NETWORK MEMBERS
UNDERSTANDING TITAN
PERFORMANCE HIGHLIGHTS
39
TITAN Group’s Compliance Program and business ethics
A TITAN Group Compliance Program has been in place since
2020, as an integrated system of activities, mechanisms and
controls, aiming to provide adequate assurance that compliance
risks are timely identified, properly assessed and effectively
mitigated, so that the possibility of a significant compliance
failure is minimized. The Compliance Program facilitates the
effort to maintain and foster a strong compliance culture,
ensuring adherence to compliance requirements and promoting
consistent and responsible ethical behavior. It is a risk-based
program with dynamic elements and incorporates monitoring
and oversight, compliance awareness, training, risk assessment
and third-party due diligence components.
Consistent with our values and culture, and as clearly articulated
in the TITAN Code of Conduct and relevant Group Policies,
the Group follows a zero-tolerance approach towards bribery,
fraud and any other corruptive practice. The Anti-Fraud
Program Framework was developed during 2021 and widely
communicated throughout the Group promoting openness and
transparency, providing standards and guidelines, and clarifying
roles, expectations and responsibilities on the subject of
occupational fraud.
TITAN launched in 2021 the second phase of its “Group Policies
Awareness” program, with the aim to raise awareness and
understanding around our Code of Conduct and the set of
Sustainability and Social Responsibility Policies – the tools that
foster ethical behavior and represent “Our Culture in Practice”.
Commitment to human rights
Consistent with the United Nations Guiding Principles on
Business and Human Rights, TITAN is committed to respecting
and supporting human rights with regard to its employees,
the communities where it operates and its business partners.
Human rights is one of the key subject areas of the TITAN
Group Compliance Program, which provides a well-structured
framework to address relevant activities in a disciplined and
holistic way across the Group.
To intensify our efforts to ensure compliance not only with
regulatory but also with ESG requirements, and to ensure a
responsible supply chain, a comprehensive Third-Party Due
Diligence system, supported by an online tool, was developed in
2021 and is ready to be put into operation.
Our Whistleblowing Policy, introduced in 2020, encourages
employees to report possible misconduct, fraud or abuse. In
parallel, EthicsPoint, the Group reporting platform launched in
2020, provides a uniform, anonymous and strictly confidential
channel, through a globally available digital tool, to facilitate the
confidential reporting of any concern and ensure that incidents
are reported, examined and resolved with a remedy plan, if and
when necessary, thus fostering a culture of integrity and ethical
conduct.
11
Cases reported through
EthicsPoint
8,974
Compliance training hours
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
40
Risk management
TITAN is active in a diverse geographical, business, and operational landscape. This results in a multitude of potential risk exposures,
including strategic, financial, sustainability (ESG) and operational risks. Risks are categorized using established risk taxonomies
relevant to the Group’s business and are assessed in terms of probability, impact, and preparedness, in line with industry best
practices.
TITAN’s risk management framework is presented below.
Risk Management
Centrally-led Hybrid BU-led
Risks
Covered
Strategic, e.g.:
• Climate change mitigation and
adaptation
• Industry cyclicality
• Market conditions
• Political and economic uncertainty
• Global disruptions (e.g. COVID-19)
Financial - in particular:
• Foreign currency risks
• Interest rate risks
• Liquidity and leverage risks
• Counterparty risks
ESG risks:
• Health and safety
• Risks related to the environment
• Human Resources, Diversity and Inclusion
• Regulatory compliance risk
Operational Risks:
• Production cost
• Natural disasters (e.g. due to climate change)
• Cybersecurity Risks
• Supply Chain Disruption
Most
Operational/
ESG risks
that occur
at the level
of individual
businesses
Risk
Management
Approach
• Executive Committee
• Capex Committee
• Group Finance
• Other Group functions (e.g.
Procurement, R&I, IT, HR, ESG)
• Business Units (BU)
• Higher central oversight vs. BU-led risks
• BU
management
as part of
day-to-day
operations
• Embedded
into business
processes
In 2021 a specific scenario-modelling assessment of the Group’s climate-related risks and opportunities took place implementing the
TCFD framework as one can see on page 41. The exercise covered physical risks like extreme temperatures, flooding and water stress,
as well as transition risks, like carbon pricing, reputational risks and litigation.
Internal Audit, Risk and Compliance Unit and Audit and Risk Committee
The list of the Group's main risks and the respective probability vs. impact heat map is presented below:
UNDERSTANDING TITAN
PERFORMANCE HIGHLIGHTS
SR1 Climate Change &
GHGE
SR2 Industry Cyclicality
SR3 Local Market
Conditions and
Prospects
SR4 Geopolitical Risk
SR5 Global Systemic
Disruption
SR6 Acquisitions/
Investments/
Divestments
SR7 Key (top level)
Management
OR1 Energy Costs
OR2 Cybersecurity
OR3 Extreme Natural
Events
OR4 Supply Chain
Disruption
OR5 Product Quality/
Product Failure
OR6 Litigation
ESG1 Health and Safety
ESG2 License to Operate/
Access to Key
Materials
ESG3 Risk Related to the
Environment
ESG4 Human Resources,
Diversity & Inclusion
ESG5 Corruption/Fraud
ESG6 Regulatory and
Compliance Risk
ESG7 Governance,
Transparency &
Ethics
FR1 Foreign Currency
Risk
FR2 Goodwill Impairment
Risk
FR3 Taxation Risk
FR4 Customer Credit Risk
FR5 Liquidity Risk
FR6 Interest Rate Risk
FR7 Counterparty Risk
0
1
2
3
4
5
SR1
SR5
SR7
FR6
FR5
SR2
Probability
Impact
Strategic Financial ESG Operational
FR7
ESG7
ESG5
ESG6
OR6
OR4
OR5
SR6
ESG4
FR4
ESG3
OR3
ESG2
OR1
FR3
OR2
ESG1
FR2
SR4
SR3
FR1
012345
41
Climate-related financial
disclosures (TCFD)
Engaging with climate change risk experts and based on the
different Intergovernmental Panel on Climate Change (IPCC)
scenarios, TITAN Group in 2021 assessed the physical and
transitional risks stemming from climate change, as well as the
opportunities from the transition to a low-carbon economy,
according to TCFD recommendations. The table below provides
all necessary links with the TITAN Integrated Annual Report
and our 2021 submission to the CDP. More information on the
methodology used and the risks and opportunities can be found
on page 95-96 of the Report (ESG Performance Review).
Governance Strategy Risk management Metrics and targets
Board’s oversight of
climate-related risks and
opportunities
IAR 2021, p.36-38, 40, 95-96
CDP C1. Governance
Climate-related risks and
opportunities identified
IAR 2021, p.12, 73-78
CDP C2. Risks and opportunities
Processes for identifying and
assessing climate-related
risks
IAR 2021, p.40, 73-78, 95-96
CDP C1. Governance
C2. Risks and opportunities
Metrics used
IAR 2021, p.30, 40, 73-78, 82-84,
95-96, 103-105, 120
CDP C1. Governance
C4. Targets and performance
C9. Additional metrics
C11. Carbon pricing
Management’s role
IAR 2021, p.36-38, 40, 95-96
CDP C1. Governance
Impact on the organization’s
businesses, strategy, and
financial planning
IAR 2021, p.12, 73-78
CDP C2. Risks and opportunities
C3. Business Strategy
C4. Targets and performance
C9. Additional metrics
C12. Engagement
Processes for managing
climate-related risks
IAR 2021, p.40, 73-78, 95-96
CDP C1. Governance
C2. Risks and opportunities
C3. Business Strategy
C9. Additional metrics
C11. Carbon pricing
C12. Engagement
Scope 1, 2 and 3 GHG and the
related risks
IAR 2021, p.82-84, 103-105, 120
CDP C6. Emissions data
C7.Emissions breakdown
C8. Energy
C9. Additional metrics
Resilience of the
organization’s strategy, for
different scenarios
IAR 2021, p.12, 73-78
CDP C2. Risks and opportunities
Integration into overall risk
management
IAR 2021, p.40, 73-78, 95-96
CDP C1. Governance
C2. Risks and opportunities
Targets and performance
against targets
IAR 2021, p.30
CDP C1. Governance
C4. Targets and performance
Please visit https://www.cdp.net for TITAN’s response to the CDP Climate change questionnaire
The cement sector will play a dual role in the transition to carbon neutrality: it will provide
infrastructure that is resilient to a changing climate and extreme weather events, and it will
reduce its own carbon footprint to help limit climate change.
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
2021 performance highlights
REGIONAL PERFORMANCE
A record year of growth despite global cost
headwinds. Favorable macroeconomic
indicators support construction activity;
substantial investments under way to
capture the anticipated market upside.
Scope 1 net CO₂ emissions
(kg/t cementitious product):
643.6
(2020: 700.2)
LTIFR (employees):
0.38
(2020: 0.39)
%sales of Type IL:
50
Alternative fuel substitution rate
(%heat basis):
8.8
(2020: 5.8)
Revenue
€983.6m
(2020: €939.7m)
EBITDA
€158.0m
(2020: €176.4m)
Assets
€1,133.3m
(2020: €1,104.9m)
2
2
Integrated
cement
plants
2,278
8
Quarries
3
Import
terminals
82
Ready-
mix
plants
7
Concrete
block
plants
4
Fly ash
processing
plants
Operational Units
Employees
USA
Market overview
The US economy rebounded strongly in 2021, following the
historic slowdown attributed to the COVID-19 pandemic. Real
GDP increased by 5.7% following a decrease of 3.4% in 2020 and
unemployment declined to 3.9%, showcasing an impressive
economic recovery. Inflation reached 7%, a level not seen since
the 1980s, reflecting the buoyancy of the economy.
Bolstered by historically low interest rates, construction
spending increased by 8.2% to $1.59 trillion. Residential
spending increased by 22.9% mainly driven by strong single-
family housing. Public construction spending contracted by
4.1% and private non-residential construction decreased by
2.1%, principally due to the decline in the travel and office
construction segments. In total for 2021, cement consumption in
the US increased by 4.1% reaching 109 million tonnes.
Regional performance
2021 was a year of solid growth for Titan America. Consumption
in our markets grew considerably above the US average, as our
customers saw their activities expanding and their backlogs
increasing. 2021 also marked an industry milestone as US
lawmakers approved the $1.2 trillion Infrastructure Investment
and Jobs Act. The Act includes $550 billion in additional new
spending that equates to an estimated increase of 50 million
tonnes of cement consumption over a five-year period (PCA
estimates). Considering the strength of the US market and its
positive outlook, the Group initiated an ambitious investment
program, aimed at expanding the effective supply capacity
of its operations and at achieving efficiencies in logistics
UNDERSTANDING TITAN
PERFORMANCE HIGHLIGHTS
Roanoke cement plant, USA
43
TITAN aims to produce carbon-neutral
concrete by 2050, in line with the
goals of the Paris Climate accord. In
an important step towards achieving
this goal, TITAN USA has pioneered the
adoption of Portland-limestone cement
(PLC), which offers customers lower CO₂
emissions of up to 15% with equivalent
performance. Low-carbon cements, such
as PLC (ASTM Type IL), are essential
for sustainable development and were
first introduced by TITAN USA in 2015.
Since September 2021, approximately
half of Titan America’s cement output
consists of the lower-carbon Type IL
cement, making Pennsuco the largest
producer of it in the USA. Our PLC was
the first such cement to be approved by
Florida Department of Transportation
(FDOT) in 2017. We also worked closely
with customers and specifiers to update
commercial construction specifications
and support successful conversions of
our products to PLC.
Leading in low-carbon cement manufacturing
SDGs related to regional material issues:
and production, in order to capture growth. In 2021 cement,
ready-mix, concrete blocks and fly ash sales increased, while
aggregates sales were maintained at high levels. Revenue for
TITAN’s US operations increased compared to 2020 reaching
$1.2 billion, an increase of 8.6% year on year. In euro terms,
revenue increased by 4.7% to €983.6 million. EBITDA reached
€158.0 million, a decline of 10.5% compared to 2020 (-6.8% in US
$ terms) as operational profitability was constrained by global
cost headwinds and supply chain disruptions which reflected
negatively on import freight, energy, logistics and labor costs.
Florida
Florida continues to develop as a business and financial center
and also to benefit from the positive migration trends of recent
years, which are leading to increased housing demand and
attendant non-residential construction. Overall, 2021 cement
consumption in Florida grew by 12.2% to 9.1 million tonnes.
Virginia, and the Carolinas
Cement consumption in Virginia increased by 2.9% to 2.2 million
tonnes, while consumption in North Carolina increased by 7.3%
to 3.2 million tonnes. Business performance was driven by
increased volumes, boosted by strong residential demand and
cement-intensive public works projects.
New York/Metro
In the New York Metropolitan area, cement consumption
increased by 4.6% to 1.9 million tonnes and in New Jersey by 7.4%
to 1.5 million tonnes. Our import terminal, which serves both
aforementioned markets, expanded its sales but higher import
costs negatively affected its profitability.
ESG Performance
In 2021, protecting the health and wellbeing of our people
and communities from COVID-19 remained a key priority. We
continued to provide emergency sick and quarantine pay, which
we established in 2020, and to implement COVID-related safe-
working protocols. We provided onsite vaccination clinics for
families and contractors, and established new mental health and
wellbeing programs. Lost time and recordable health and safety
incidents remained at historical lows. Despite the pandemic
and the tight labor market, we were able to continue to hire,
onboard and train employees in preparation for our next phase
of growth. We accelerated progress towards our carbon footprint
goals. Our new processed engineered fuel facility at Pennsuco
enabled the substitution of coal and natural gas usage in our
kiln by 30% with alternative fuels. The plant is now also the
largest producer of Portland-limestone cement (PLC) which
meets ASTM C595 Type IL specifications, in the USA. Pennsuco
and Roanoke, the only US cement plants certified to ISO 50001,
enjoy at least 15 years of energy-management excellence under
the EnergyStar program. The Portland Cement Association (PCA)
and the US Green Building Council recognized the two sites in
their annual environmental performance awards for excellence
in sustainability and community engagement. Last but not least,
the Roanoke team strengthened community partnership during
the pandemic by creatively using drone technology to deliver
plant tours.
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
Pennsuco cement plant, USA
REGIONAL PERFORMANCE
Greece and Western Europe
2019 Performance highlights
Marked performance improvement despite
the significant rise in energy costs.
Market overview
Demand continued to grow at a strong rate, similar to the one
recorded in 2020, leading cement consumption in 2021 close to
the 3 million tonnes mark. The main drivers of demand were the
increased levels of activity in public and municipal infrastructure
projects, as well as growth in residential construction and
broader real estate and logistics projects. Tourism activity also
picked up, following the slowdown caused by the pandemic.
The positive trend in residential construction and tourism is set
to continue, as indicated by the consistent increase in building
permits, while large-scale infrastructure projects across Greece
are now underway.
Cement exports remained strong, with the US representing
Greece’s biggest export destination.
Regional performance
2021 was a year of solid sales performance, with higher export
and domestic cement volumes. At the same time profitability
was impacted by an unexpected steep rise in energy, raw
materials, and transportation costs in the second half of
the year which have affected the industry at a national and
international level. Energy costs were partly mitigated by the
notable increase in alternative fuel utilization and by further
operational efficiencies that resulted from an increased number
of digitalization projects, such as the Cement Mill Optimization
projects carried out in our plants.
Overall export volumes remained strong with the US being the
leading destination. The Group’s import terminals in the UK, Italy
and France performed in line with the trends of their respective
local markets. As such, high cement export volumes also resulted
in high capacity utilization rates of the plants. Total revenue for
Greece and Western Europe in 2021 increased by 9.4% to €267.6
million while EBITDA increased by €7.4 million to €23.6 million.
2021 performance highlights
Employees
1,208
Revenue
€267.6m
(2020: €244.6m)
EBITDA
€23.6m
(2020: €16.2m)
Assets
€549.4m
(2020: €551.5m)
Alternative fuel substitution rate
(%heat basis):
28.6
(2020:27.0)
LTIFR (employees):
0.00
(2020: 0.49)
Active quarry sites with biodiversity
management plans:
6
(2020: 5)
Share of women in new hires (%):
29.8
(2020: 20.3)
3
Integrated
cement
plants
25
Quarries
1
Cement
grinding
plant
2
Processed
engineered
fuel
facilities
3
Import
terminals
28
Ready-
mix
plants
1
Dry
mortar
plant
Operational Units
UNDERSTANDING TITAN
PERFORMANCE HIGHLIGHTS
Patras cement plant, Greece
45
ESG Performance
We maintained our strong performance in Health and Safety
despite the limitations caused by the pandemic. Leading
indicators, including training hours for employees and contractors
remained on target and we piloted a new e-learning program in
our plant in Patras. We continued to reduce our carbon footprint,
by further increasing the use of alternative fuels and reducing
our clinker-to-cement ratio, through the launch of new types of
cement – CEM II/B-M 42.5 and Type IL (ASTM) for our domestic and
international markets. We also piloted two new decarbonization
initiatives: the introduction of hydrogen as a fuel enhancer in the
main burner of the kiln and the use of calcined clays in low-carbon
cement production. Moreover, we issued third-party verified
Environmental Product Declarations (EPDs) for all cement and key
concrete products, to mark our product and process excellence,
disclosing the information customers need for sustainable
construction. All our integrated cement plants in Greece received
platinum-level zero waste-to-landfill certifications for diverting
practically 100% of waste from landfills. Our sustainability
initiatives in 2021 focused on creating value for communities
through partnerships with the Hellenic Society for the Protection
of Nature, Young Men's Christian Association Thessaloniki and
Youthnest. The previous year was also rich in actions for our
employees, with an emphasis on promoting well-being, fostering
open communication and accelerating talent development.
Last but not least, following the devastating summer wildfires
across Greece, TITAN and the Paul and Alexandra Canellopoulos
Foundation jointly donated a total of €1 million for long-term
rehabilitation and prevention efforts.
In 2021, TITAN’s cement plant in Thessaloniki participated in
the multi-stakeholder circular economy program “Nothing
to Waste” to promote sustainable solutions for the local
community and the environment, in collaboration with other
companies. At the core of the project, which was initiated by
TITAN and its employees, are 24 companies and more than
500 employees. The initiative was designed and implemented
with the scientific support of the non-profit organization
“NoWaste21”. It promotes efficient waste management while
taking into account the specifics of each type of business
activity.
Recycling corners were created in each of the 24 businesses
to collect and sort six types of recyclable materials, namely
paper, PET plastic bottles, residual plastic-metal-composite
packaging (PMD), electrical appliances, portable batteries, and
cooking oil. A training program for the employees and their
families was carried out on topics such as waste prevention,
circular economy as a new model of individual responsibility
towards the environment, and the preservation of natural
resources for future generations.
Some 16 metric tonnes of recyclable materials were collected.
This significant result highlights the role that all businesses,
irrespective of size, can play in promoting circular economy
and the leadership that companies such as TITAN, can and
must show in bringing together peers, authorities and
communities for the benefit of the environment.
“Nothing to Waste”: A recycling business initiative for the community
SDGs related to regional material issues:
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
REGIONAL PERFORMANCE
Southeastern Europe
Construction activity and attendant cement
demand continued to grow; surge in
energy costs in the second half softened
profitability performance.
Regional performance
In this growing regional market, revenue increased to €290.6
million, driven by higher domestic market volumes and improved
pricing. Price increases were not sufficient to offset the increase
in electricity and fuel costs, which surged especially in the
second half of the year. As a result, in spite of productivity gains,
EBITDA declined by 14.8% versus 2020, reaching €81.9 million, still
above however the profitability of 2019. In the last quarter, price
increases were announced, in anticipation of further input cost
hikes in the coming months.
In the second year of the pandemic, our plants were fully
operational, whilst our focus remained on protecting the health
and well-being of our employees. We continued investing in
expanding the efficiency of our plants, with two of them reaching
more than 10-year production records.
Albania
The Albanian economy grew by ca. 7%, following a year of
contraction. Private construction activity continued being robust,
while heightened building activity in the run-up to elections
held in the first half of the year boosted cement demand by an
estimated 12% compared to 2020.
Bulgaria
In spite of a ca. 3% growth in Bulgaria’s GDP, the construction
market slowed down, as a result of the political uncertainty
generated by repeated elections. Cement demand recorded only a
marginal increase of approximately 1%. Group volumes decreased,
squeezed by the increase in the flow of imports into the country.
Alternative fuel utilization reached new records, supporting both
the company’s decarbonization efforts and helping mitigate
energy costs.
2021 performance highlights
Employees
1,130
Revenue
€290.6m
(2020: €271.0m)
EBITDA
€81.9m
(2020: €96.2m)
Assets
€467.1m
(2020: €456.9m)
Scope 1 specific net CO₂ emissions
(kg/t cementitious product):
633.1
(2020: 641.6)
LTIFR (employees):
2.43
(2020: 1.48)
Share of women in new hires (%):
33.8
(2020: 29.5)
Number of community engagement
initiatives:
77
(2020: 65)
Alternative fuel substitution rate
(8.0% heat basis):
8.0
(2020:6.7)
5
Integrated
cement
plants
20
Quarries
1
Processed
engineered
fuel facility
6
Ready-
mix
plants
Operational Units
UNDERSTANDING TITAN
PERFORMANCE HIGHLIGHTS
Antea cement plant, Albania
47
Kosovo
The construction sector in Kosovo, driven by the residential and
commercial segments, grew by an estimated 4% on the back
of a GDP growth of ca. 7%. TITAN supplied the market from its
local plant as well as through its nearby cement plant network in
North Macedonia and Albania, having set up the supply chain to
effectively serve the market in line with the evolution of demand.
North Macedonia
GDP in North Macedonia grew by ca. 4% in 2021 with the
construction market following at pace and recording a growth of
ca. 3%, driven by all market segments. Demand for apartments
and an increase in construction permits after the lifting of a
moratorium in Skopje, were pertinent growth drivers. Thanks to
an investment in a new shredding line at ΤΙΤΑΝ’s plant, the use of
locally sourced alternative fuels was increased.
Serbia
The Serbian economy grew by 6% in 2021. Continuing public
infrastructure spending, but mainly a strong activity in residential
and commercial building, fueled cement demand, which grew by
ca. 14%. In neighbouring Montenegro, the main export market
of our Serbian subsidiary Kosjeric, the cement market declined
despite strong economic growth. The expected start of new
infrastructure projects has not yet materialized. During a major
kiln overhaul, we invested in the installation of a new main filter
for the plant, further reducing dust emissions.
ESG Performance
All five plants in the region continued to apply preventative
measures to stem the spread of COVID-19 among their people,
partners and local communities and to offer youth training,
outreach, mental health support and wellbeing programs.
TITAN Bulgaria’s efforts were recognized as best in class by the
Centre for Safety and Health at Work Foundation, while TITAN
Serbia continued its support to local public health institutions.
In Kosovo, we provided employment opportunities to young
people and training towards employability by joining forces with
private sector companies and local authorities. The Kosovo CSR
Network acknowledged TITAN’s contribution to society with the
Annual CSR Award. Health and Safety remained a priority, with
TITAN Bulgaria digitizing safety procedures and devising a new
safety program that streamlines all safety-critical procedures for
the region. The plants also continued to take important steps
towards decarbonization. TITAN Bulgaria managed to replace 44%
of the conventional fossil fuels in the clinker production process
with alternative fuels, thus cutting CO₂ emissions by 25kg CO₂/t
cementitious product. The installation of a modern bag filter on
the rotary kiln in Serbia, an investment of almost €2 million, has
significantly reduced dust emissions, contributing to the overall
strong environmental performance of the plant.
Zlatna Panega plant and its quarries are
located in an area of high biodiversity
value. In 2021, we implemented two
projects, in cooperation with Bulgarian
experts, in order to map out a science-
based path for the rehabilitation of the
ecosystems in the quarry. We conducted a
Net Impact Assessment (NIA) based on the
GCCA Guidelines for Quarry Rehabilitation
and Biodiversity Management. This will
allow us to amend, improve or come up
with additional respective biodiversity
rehabilitation measures in the area,
such as increasing afforestation areas,
diversifying the hornbeam with other species
characteristic for the area, but also adding
hairy oak plantations, supporting thus
some threatened and vulnerable species
developing on the periphery of such forests.
We also carried out an ecosystem services
assessment, which follows the Toolkit for
Ecosystem Service Site-based Assessment
(TESSA), developed by Birdlife International in
partnership with the University of Cambridge
and Anglia Ruskin University. This assessment
will help us to better evaluate the possible
future uses of the rehabilitated area. As part
of the TESSA study, we conducted two public
consultations with the local community and
other important stakeholders.
Connecting biodiversity management with social needs
SDGs related to regional material issues:
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
REGIONAL PERFORMANCE
Eastern Mediterranean
Return to positive performance in an
environment of continued demand growth,
despite local macroeconomic uncertainties.
Market overview
Egypt's economy has been resilient in the face of the COVID-19
pandemic, recording GDP growth of 3.3% in 2021, following growth
of 3.6% in 2020. Cement demand started to recover after four
years, as a result of stronger construction activity coming from
national infrastructure projects and the construction of affordable
housing. Cement consumption reached 48.5 million tonnes
posting a 6% increase.
In Turkey, despite the volatile economic environment witnessed
through a sharp depreciation of the local currency of 65% vs the
euro, soaring inflation of 36% and a reduction in households’
real income, the economy grew by 9% in 2021, thanks to the
continuous credit expansion following a series of rate cuts by the
Central bank. Domestic cement demand strengthened by 7%,
reaching 60 million tonnes, still approximately 15% below the peak
levels of 2017.
Regional performance
Following a few years of weak performance and despite the
macroeconomic uncertainties, the Eastern Mediterranean region
recorded total revenue of €172.8 million, an increase of 13.9% from
2020. EBITDA was €11.8 million versus a €3.3 million loss in 2020,
reflecting a significant improvement in the EBITDA margin, despite
the sharp depreciation of the Turkish Lira.
Egypt
The market regulation agreement set by the Egyptian government
on all cement producers in July 2021 narrowed the gap between
supply and demand, leading prices to much healthier levels.
Moreover, to assist the real estate industry, the government
initiated a new construction-mapping layout defining permitted
2021 performance highlights
Employees
742
Revenue
€172.8m
(2020: €151.7m)
EBITDA
€11.8m
(2020: €-3.3m)
Assets
€447.2m
(2020: €484.8m)
Alternative fuel substitution rate
(%heat basis):
13.1
(2020: 10.8)
LTIFR (employees):
2.17
(2020: 0.00)
Employees from local community (%):
88.9
(2020: 88.9)
Local spend(%):
85.1
(2020: 85.9)
Integrated cement plants with certified
Energy Management Systems
(ISO 50001 or equivalent) (%):
100
(2020: 37)
3
3
Integrated
cement
plants
1
Cement
grinding
plant
7
Ready-mix
plants
2
Processed
engineered
fuel
facilities
13
Quarries
Operational Units
UNDERSTANDING TITAN
PERFORMANCE HIGHLIGHTS
Tokat cement plant, Turkey
49
and restricted areas for building, issued new construction licensing
procedures and directed the central bank of Egypt to facilitate
mortgage procedures and conditions. TITAN achieved 7% volume
growth year on year and an increase in revenue, mainly driven
by price increases and expansion in new cement products. Many
decarbonization initiatives took place, leading to a reduction
of CO₂ emissions by 6% in Alexandria and 2% in Beni Suef. The
Company focused on operational excellence and digitization
projects, while also exploring new growth opportunities, mainly in
export markets.
Turkey
The performance of our Turkish operations in 2021 reflected the
upward trend of the cement industry. Continued demand for
private housing, public infrastructure projects as well as exports
were for another year the backbones of growth for our local
operations. Production costs increased mainly due to higher
electricity and fuel prices -both affected by the depreciation of the
Turkish Lira by 65%- however they were offset by significant price
increases and by growth in both domestic and export volumes.
Our local modern assets and the healthy balance sheet, allowed
us to withstand macroeconomic headwinds and to satisfy the
increasing market demand.
ESG performance
Despite a challenging year in both plants due to COVID-19 and
its financial ramifications, TITAN Egypt and TITAN Turkey took a
number of steps to improve their ESG performance. TITAN Egypt
secured ISO 50001 certification in energy management, thus
building on its achievements in reducing its carbon footprint.
Likewise, TITAN Turkey stepped up its usage of alternative fuels
and reduced the clinker content of its cement, launching CEM
II/A-LL 42.5R in the market. In Egypt, we maintained our academic-
industrial collaboration with Alexandria and Beni Suef universities,
preparing about 150 undergraduates for the labor market, while in
Turkey, our people attended over 100 different training programs
in fields such as soft skills, leadership, digitalization and project
management. In the area of COVID-19, in Egypt we implemented
awareness raising and vaccination campaigns for our people and
our contractors while taking all precautionary measures. In Turkey,
we achieved another Health and Safety milestone by successfully
completing the transition to ISO 45001. Community outreach also
continued, though Adocim’s Employee Assistance program and
online wellbeing seminars for employees and their families, as
well as through TITAN Egypt’s programs, conducted in partnership
with NGOs, to improve the living and health conditions of our local
communities.
In order to attract young talented
candidates to the company and offer
internships in Tokat, in 2021 TITAN
Turkey signed a protocol with Tokat
Gaziosmanpaşa University (TOGÜ). Under
the protocol, we committed ourselves
to provide internship and employment
opportunities (both full- and part-time)
to TOGÜ students and graduates. The
two-day TOGÜ career fair 2021 allowed
members of our technical staff to speak
directly to students, to answer their
questions and invite them to submit job
and internship applications. The career
fair was a very fruitful experience as we
were able to contribute to informing
TOGÜ students about their job prospects,
creating career awareness and providing
them with information about companies,
institutions and professions.
Finding and recruiting talent
SDGs related to regional material issues:
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
50
STET
ST Equipment & Technology LLC (STET), a wholly owned
subsidiary of the TITAN Group based in Needham, MA, USA, is a
designer, manufacturer and marketer of proprietary separation
equipment. The patented STET technology is suited for the
processing of dry powders and recycling of waste streams in
an innovative, environmentally sustainable and cost-effective
manner, contributing to the circular economy and climate change
mitigation.
The applications for the STET processing technology include
the recycling of coal combustion fly ash, water-free processing
of minerals, and upgrading of plant derived proteins for animal
feed and human food applications. In 2021, STET commissioned
the world’s first industrial-scale plant to reclaim, dry and
electrostatically separate landfilled fly ash which is then used to
reduce the carbon footprint of cement and concrete products.
Through this innovative process, an unusable waste material
is converted into high-quality, green end-products used in the
cement, concrete and power generation industries. Resulting
benefits include a lower carbon footprint and a solution for the
cleanup and remediation of fly ash landfills and ponds.
The STET water-free beneficiation process offers sustainability
benefits to industries other than cement. In 2021, STET
successfully manufactured a high-protein Dry Distillers Grain with
Solubles (DDGS), a plant-based protein source generated from the
corn ethanol industry that offers a sustainable source of protein for
aquaculture rations.
GAEA
Green Alternative Energy Assets (GAEA) is a company that provides
services in waste utilization and alternative fuels production.
Established in 2011 in Bulgaria, GAEA has been recognized as a
reliable solutions provider in the Bulgarian waste market. During
its ten years of operation in Bulgaria, GAEA has provided solutions
to a wide range of manufacturing and recycling industries in the
country, actively contributing to the circular economy. In 2021,
GAEA upgraded its operations by investing in new, state-of-the-
art mechanical treatment equipment, enabling the Zlatna Panega
Cement plant to substantially increase its alternative fuels’
thermal substitution rate to a new all-time record. GAEA has also
expanded its operations in Egypt since 2016, providing solutions
for municipal solid waste to the municipalities of Alexandria and
Beni Suef and producing refuse-derived fuel (RDF) to supply the
Group’s cement plants, thus reducing the Group’s carbon footprint.
Other business activities
REGIONAL PERFORMANCE
Joint venture
in Brazil
Overview
In Brazil, the improved economic environment led to stronger
construction activity and cement demand grew for a third
consecutive year. In the second half of 2021 however, the market
witnessed a slight slowdown as inflationary pressures started to
mount and interest rates increased.
Regional performance
Our joint venture Apodi increased its sales volumes at a higher
rate than the national average by continuing to penetrate the
bulk cement segment, with a focus on the pre-cast industry, the
growing regional wind park sector and projects in the renovation
and expansion of infrastructure such as the Fortaleza airport. As
a result, Apodi posted a significant increase in revenue to €83.8
million vs €70.7 million in 2020, while net profit attributable to
TITAN Group reached €2.7 million compared to €2.6 million in
2020, posting a 4.6% increase.
ESG performance
Our joint venture in Brazil continued to integrate ESG
practices, according to its material issues and the Sustainable
Development Goals and it published its second Sustainability
report in 2021. Cimento Apodi’s main sustainability and
community outreach projects continued in 2021, despite the
challenges posed by the pandemic. The promotion of the use
of the native carnauba palm tree as biomass in co-processing
contributed to the creation of new forms of employment and
income for the local communities around our plants while
our participation in the Construir Saber Project of the Social
Service of Industry (SESI) continued to equip young people and
adults with higher levels of education. Furthermore, we kept
doing voluntary work in the community, supporting handcrafts,
donating food parcels, providing PPE to hospitals while also
raising awareness on the need for environmental conservation
and other topics.
UNDERSTANDING TITAN
PERFORMANCE HIGHLIGHTS
Demand growth for a third consecutive year.
51
Outlook 2022
The current military conflict after the Russian invasion in the
Ukraine creates geopolitical uncertainties with macroeconomic
implications the extent of which cannot yet be assessed.
TITAN Group has no exposure to Ukraine, Russia or affected
regions. Nevertheless the effect on the Group’s businesses
from developments in the energy sector and the broader macro
implications are anticipated to impact market trends and further
increase inflation risks.
In the US, despite macroeconomic risks, the underlying
construction market dynamics remain strong. Residential activity
continues to reflect the country’s housing deficit with both
the multi- and single-family segments driving demand. The
infrastructure segment is poised to provide a steady backbone
to demand from 2023 onwards, as the full effect of America’s
large infrastructure investment drive starts to materialize on the
ground. Cost pressures are expected to persist and the Group
will continue to address global cost headwinds by adjusting
pricing, as evidenced already by the successful price increase
implemented in January in both Florida and mid-Atlantic and
by the recently announced second round of price increases in
Florida. At the same time, TITAN initiated an investment program
to significantly grow its effective capacity. This centers around
the transformation and expansion of the import terminals
in Tampa, Florida and in Norfolk, Virginia, including the $60
million construction of two new storage domes. Several other
investments and initiatives are in progress aiming to achieve
logistics and production efficiencies, which will effectively allow
the Group to capture the market’s upside for several years ahead
and to improve flexibility and customer service. Concurrently,
TITAN America is building on its head start with the full adoption
of lower carbon footprint cements across its operations.
The impact of the ongoing war in the Ukraine may lead to more
uncertainties in Europe overall. There is a negative impact
already on the energy sector, the severity of which, as well as the
duration, cannot yet be assessed. The European economies are
entering a difficult phase, with increased risks of rising inflation
and a slowdown of economic growth.
In Greece, demand growth in the residential segment looks set
to continue from a low base, with the larger urban centers which
our plants primarily serve, holding the lion’s share of growth.
The infrastructure pipeline is ripe with projects scaling up and
offering a backlog timeline for the years ahead. The Group is
continuing its efforts on all fronts to manage its cost base and
minimize its carbon footprint. Alternative fuel utilization is
constantly increased, supported by investments in both the
Kamari and Thessaloniki plants. The Group is continuing with the
roll-out of more environmentally friendly cement products with
lower clinker content.
Southeastern Europe should continue delivering satisfactory
returns, driven primarily by residential and light commercial
development, as well as select infrastructure projects, depending
on the country. Cost challenges will persist but the Group
continues its efforts unabated to address inflationary pressures
and mitigate their impact on operational profitability. Alternative
fuel utilization is increasing, as is the promotion of new products
with lower carbon emissions throughout our regional presence.
In Egypt the economy is growing driven by large infrastructure
projects and the country’s increased LNG exports. Trends
of cement demand are positive going forward and the new
balance between supply and demand favors a healthier pricing
environment. The Group is well-placed to benefit from market
dynamics and alternative fuel utilization has been increasing,
aiming to both address costs as well as ameliorate the Group’s
carbon footprint.
The situation remains challenging in Turkey, exacerbated by the
geopolitical turbulence on the Black Sea. The outlook for the
construction sector is highly dependent on the fortunes of the
economy which remains under stress. Successful price increases
manage to address the inflationary pressures while increased
export volumes provide an outlet for the Group.
In Brazil, while high commodity prices and the country’s
trade surplus should support the economy, global inflationary
pressures, in an election year, make for a very delicate
macroeconomic setting.
In 2022, we will continue to harness the advantages offered
by decarbonization, digital transformation and business model
innovation to benefit our customers, employees, suppliers,
and communities, aspiring to deliver to society carbon-neutral
concrete by 2050.
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
52
Pennsuco cement plant, USA
52
53535353
MANAGEMENT REPORT
corporate
governance
and risk
management
Our approach to corporate governance and risk management.
54
1. Corporate Governance Code
1.1 Application of the Belgian Corporate Governance Code
2020
Titan Cement International S.A. (the Company) is a public limited
liability company incorporated under Belgian law. Its shares are
listed on the regulated markets of Euronext Brussels, Euronext
Paris and the Athens Exchange.
The Company is committed to the highest governance principles,
seeking consistent enhancement of its corporate governance
performance and promoting transparency, sustainability and
long-term value creation.
The Company applies the principles of the Belgian Corporate
Governance Code 2020 (the 2020 CG Code or the Code),
which is publicly available on the website: https://www.
corporategovernancecommittee.be/en/over-de-code-2020/2020-
belgian-code-corporate-governance.
The Code is structured under ten principles, which are further
detailed in several provisions-recommendations. The “comply or
explain” principle states that all listed companies are expected
to comply with all the provisions of the Code, unless they
provide an adequate explanation for deviating from a provision.
The Corporate Governance Charter (the CG Charter), which is
available on the Company’s website (https://www.titan-cement.
com/wp-content/uploads/2021/07/TCI-CG_Charter_22.7.2021.
pdf), describes the main aspects of the Company’s governance
structure, as well as the terms of reference of the Board of
Directors and its Committees and the Dealing Code of the
Company.
1.2 Deviations from the Code
The Company complies with the provisions of the Code except
with regard to the following deviations:
a. Non-executive board members do not receive part of their
remuneration in the form of shares in the Company. Therefore,
the Company deviates from Provision 7.6 of the Code. This
deviation is explained by the fact that the interests of the non-
executive directors are currently considered to be sufficiently
oriented to the creation of long-term value for the Company
and, hence, that their partial payment in the form of shares
is not deemed necessary. This is a new provision of the Code,
which had not been taken into account when the remuneration
of the non-executive directors had been decided. However,
the Company intends to consider, after the completion of the
current term in office of the non-executive Board members, the
alignment of the Company with the Provision 7.6 of the Code.
b. No provisions regarding the recovery of variable remuneration
paid to executives or withholding the payment of variable
remuneration of executives are included in the contracts with
the Managing Director and other executives. Therefore, the
Company deviates from Provision 7.12 of the Code. This deviation
is explained by the fact that variable remuneration is paid only
after the criteria set for such payment in advance, have been
met. In case of early termination, the Company applies the
Remuneration Policy, which was approved by the Annual General
Meeting of Shareholders on 14 May 2020.
1.3 Governance Structure
The Company has chosen the one-tier governance structure
consisting of the Board of Directors, which is authorized to
carry out all actions that are necessary or useful to achieve the
Company’s purpose, except for those for which the General
Meeting of Shareholders is authorized to carry out by law.
At least once every five years, the Board shall review whether
the chosen one-tier structure is still appropriate, and if not,
it should propose a new governance structure to the General
Meeting of Shareholders.
2. Capital, Shares and Shareholders
2.1 Capital
On 31 December 2021, the share capital of the Company
amounted to €1,159,347,807.86 and was represented by 78,325,475
shares, without nominal value, with voting rights, each
representing an equal share of the capital.
2.2 Shareholder Structure
The shareholder structure of the Company as of 31 December
2021, based on the transparency notifications made by its
shareholders on 24 June 2021 is the following:
• E.D.Y.V.E.M. Public Company Ltd, Andreas Canellopoulos,
Leonidas Canellopoulos, Nellos-Panagiotis Canellopoulos, Pavlos
Canellopoulos, Takis-Panagiotis Canellopoulos, Trust Neptune,
Alexandra Papalexopoulou, Dimitri Papalexopoulos and Eleni
Papalexopoulou, who act in concert, hold 29,004,392 shares
corresponding to 37.03% of the Company’s voting rights;
• FMR LLC – Fidelity Institutional Asset Management Trust
Company – FIAM LLC and Fidelity Management & Research
Company LLC hold 8,244,786 shares corresponding to 10.53% of
the Company’s voting rights;
• The Paul and Alexandra Canellopoulos foundation holds
7,900,039 shares corresponding to 10.09% of the Company’s
voting rights.
However, based on changes in shares that did not require a
transparency declaration, due to the fact that the 5% threshold
was not exceeded either upwards or downwards, the actual
percentage held by shareholders on 31 December 2021 is the
following:
• E.D.Y.V.E.M. Public Company Ltd, Andreas Canellopoulos,
Leonidas Canellopoulos, Nellos-Panagiotis Canellopoulos, Pavlos
Canellopoulos, Takis-Panagiotis Canellopoulos, Trust Neptune,
Alexandra Papalexopoulou, Dimitri Papalexopoulos, Eleni
Papalexopoulou, Alpha Trust, Delta Trust and Lamda Trust, who
act in concert, hold 30,641,972 shares corresponding to 39.12% of
the Company’s voting rights;
• The Paul and Alexandra Canellopoulos foundation holds
7,962,542 shares corresponding to 10.17% of the Company’s voting
rights;
Corporate governance statement
MANAGEMENT REPORT
CORPORATE GOVERNANCE AND RISK MANAGEMENT
55
• FMR LLC – Fidelity Institutional Asset Management Trust
Company – FIAM LLC and Fidelity Management & Research
Company LLC hold 8,244,786 shares corresponding to 10.53%
of the Company’s voting rights (based on the transparency
declaration made on 24 June 2021);
• Others: 40.18%
The legal threshold applied by the Company requires a
transparency declaration by shareholders at 5% and each
subsequent multiple of 5%.
The Company’s Shareholder Structure and the relevant
transparency declarations are available on the Company’s
website: https://ir.titan-cement.com/en/shareholder-center/
shareholder-structure.
2.3 Interactions with institutional and individual
investors
The Company regularly interacts with institutional investors.
Roadshows are organized with the participation of executive
Board members and investor relations representatives. The
Company’s representatives attend investor conferences and
pursue dialogue with the investment community on TITAN’s
strategy, business performance and progress against ESG goals.
In 2021, TITAN participated mainly remotely in investor
conferences and roadshows in several countries across Europe.
In addition, a few in-person meetings were held in autumn
before the new upsurge in the pandemic.
At the same time, shareholders have access to clear,
comprehensive and transparent information through direct
contact with the investor relations team, including corporate
presentations and information available on the Investor
Relations section of the Company's website.
The Shareholder Services Department responds to all queries
and requests for information and shareholder assistance.
3. Board of Directors
3.1 Resumes of Directors
Efstratios-Georgios (Takis) Arapoglou
Chairman – Non-executive Director – Chairman of the Nomination
Committee
Takis Arapoglou has had an earlier career in International Capital
Markets and Corporate & Investment banking based in London
and later in managing, restructuring and advising publicly listed
Financial Institutions and Corporates, primarily in SE Europe and
the Middle East.
Most recent executive assignments include: Managing Director
and Global Head of the Banks and Securities Industry for Citigroup;
Chairman and CEO of the National Bank of Greece; CEO of
Commercial Banking at EFG-Hermes Holding SAE.
He is currently holding the following non-executive board
positions: Chairman of Bank of Cyprus Group, Chairman of Tsakos
Energy Navigation (TEN) Ltd and non-executive Board member of
EFG-Hermes Holding SAE.
He has degrees in Mathematics, Engineering and Management
from Greek and British Universities.
Kyriacos Riris
Vice Chairman – Independent Director – Chairman of the Audit and
Risk Committee
Kyriakos Riris completed his high-school education in Cyprus,
before continuing his higher education and professional
qualifications at Birmingham Polytechnic.
He completed his professional exams with the Association
of Certified Chartered Accountants (ACCA) in the UK in 1975,
becoming a Fellow of the Association of Certified Accountants
in 1985. Since 1976, he has worked mostly in Greece. He was
a member of the Executive Committee of PwC Greece and
became a Partner in 1984. His responsibilities have included that
of Managing Partner of the Audit and the Advisory/Consulting
Departments respectively, and later Deputy Territory Senior
Partner. In 2009, he was elected as Chairman of the Board of
PwC Greece, retiring from that position in 2014.
With a career spanning some 40 years, he has accumulated
vast experience with both domestic and multinational entities
in a variety of sectors and industries, including manufacturing,
shipping, commerce, food and beverages, construction,
pharmaceuticals, financial services and information systems.
Dimitri Papalexopoulos
Chairman of the Group Executive Committee
Dimitri Papalexopoulos started his career as a business consultant
for McKinsey & Company Inc in New York and Munich.
He joined TITAN in 1989 and in 1996 he assumed the position of
Chief Executive Officer.
Mr. Papalexopoulos is Vice-Chair of the European Round Table for
Industry (ERT) and chairs the ERT’s Energy Transition and Climate
Change Committee.
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
56
In June 2020, he was elected Chairman of the Board of the Hellenic
Federation of Enterprises (SEV). He is a member of the Board of
the Foundation for Economic and Industrial Research (ΙΟΒΕ), the
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
and of Endeavor Greece
He holds an MSc in Electrical Engineering from the Swiss Federal
Institute of Technology (ETHZ) and an MBA from Harvard Business
School.
Michael Colakides
Managing Director – Group CFO
Michael Colakides started his career at Citibank Greece, where
over time he held the positions of Head of FIG and Head of
Corporate Finance and Local Corporate Banking (1979–1993). In
1993, he was appointed Executive Vice Chairman at the National
Bank of Greece responsible for the Corporate and Retail Banking
business.
In 1994, he joined TITAN Cement Company S.A. as Group CFO and
was a member of the Board until 2000. He was also responsible for
a number of cement company acquisitions in Southeast Europe,
Egypt and the U.S.A.
From 2000 to 2007, he served as Vice Chairman and Managing
Director at Piraeus Bank S.A., overseeing the domestic Wholesale
and Retail Banking business, as well as the group’s international
network and activities. In 2007, he joined EFG Eurobank Ergasias
S.A. as Deputy CEO - Group Risk Executive Officer (2007–2013),
overseeing the risk management in Greece and abroad.
In January 2014, he returned to TITAN Cement Group as Group
CFO and executive member of the Board of Directors. In July
2019, he was also appointed to the position of Managing Director
of Titan Cement International SA.
As of November 2021, he is non-executive Chairman of Alpha
Bank Cyprus.
He holds a BSc in Economics from the London School of
Economics and an MBA from the London Business School.
William Antholis
Independent Director – Member of the Remuneration Committee
William Antholis is director and CEO of the Miller Center, a
nonpartisan affiliate of the University of Virginia that specializes
in presidential scholarship, public policy and political history.
From 2004 to 2014, he was Managing Director of the Brookings
Institution. He has also served in government, including at the
White House National Security Council and National Economic
Council, and at the US State Department’s policy planning staff
and bureau of economic affairs.
He has published two books, as well as dozens of articles, book
chapters, and opinion pieces on US politics, US foreign policy,
international organizations, the G8, climate change and trade.
He earned his PhD from Yale University in Politics (1993) and his
BA from the University of Virginia in Government and Foreign
Affairs (1986).
Andreas Artemis
Independent Director – Member of the Nomination Committee
Andreas Artemis is an executive member of the Board of
Directors of Commercial General Insurance Group since 1985 and
Chairman since 2002.
He is also member of the Board of Directors of the Cyprus
Employers and Industrialists Federation, as well as of the Council
of the Cyprus Red Cross Society.
He has served as member of the Board of Directors of the
Bank of Cyprus Group (2000–2005), Vice Chairman (2005–2012)
and Chairman (2012–2013). He has also served on the Board of
Directors of the Cyprus Telecommunications Authority (1988–
1994) and as Honorary Consul General of South Africa in Cyprus
(1996–2012).
He studied Civil Engineering at the Queen Mary and Imperial
College of the University of London and holds a BSc in
Engineering and an MSc degree.
Leonidas Canellopoulos
Executive Director
Leonidas Canellopoulos is the Chief Sustainability Officer of
TITAN Group. He is also responsible for Group Corporate Affairs.
Since 2012, he has covered various roles within the Group’s
Finance and Strategic Planning functions and has served as
Cement Operations Director of the Group’s Greek Region.
Prior to that, he worked for Separation Technologies LLC.
He is a member of the Board of Directors of the Foundation
for Economic and Industrial Research (ΙΟΒΕ) and of Junior
Achievement Greece.
He holds a BA in Economics with Honors from Harvard University
and an MBA from INSEAD, where he received the Henry Ford II
Prize.
Harry David
Independent Director – Member of the Audit and Risk Committee
Harry David earned his BS from Providence College and began
his career as a certified investment advisor with Credit Suisse in
New York.
He then served in several executive positions within Leventis
Group Companies in Nigeria, Greece and Ireland.
Today he serves as the Chairman of Frigoglass S.A. and as
member of the Board of A.G. Leventis (Nigeria) PLC, the Nigerian
Bottling Company Ltd, Beta Glass (Nigeria) PLC, Frigoglass
Industries (Nigeria) Ltd, Pikwik (Nigeria) Ltd (a joint venture with
Pick n Pay, South Africa).
He is a member of the TATE Modern’s Africa Acquisitions
Committee.
He has served on the Boards of Alpha Finance, Greece’s Public
Power Corporation and Emporiki Bank (Crédit Agricole).
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Lyn Grobler
Independent Director – Member of the Nomination Committee
Lyn Grobler is an experienced executive with a strong track-
record in technology and IT roles. She was appointed Group Chief
Information Officer (CIO) at Howden Group Holdings (formerly
Hyperion Insurance Group) in 2016.
Prior to this she was Vice President and CIO Corporate Functions
at BP, where she led the transformation of both the organization
and the digital landscape through introducing sustained change
in process capability and technology, having held a variety of
roles across IT and global trading over 16 years.
She is also Vice Chairperson of Bank of Cyprus.
Before BP, she managed large scale global technology projects
and strategies within banking and trading based in both London
and South Africa.
She holds a Higher National Diploma in Computer Systems
from Durban University in South Africa and a National Diploma
in Electronic Data Processing from Cape Peninsula University
(South Africa).
Yanni Paniaras
Executive Director
Yanni Paniaras studied Civil Engineering at Imperial College
(B.Sc., M.Sc.) and Business Administration at INSEAD (MBA). He
started his career at Knight Piésold, an international mining and
engineering consultancy headquartered in London.
Between 1998 and 2015, he held senior management positions,
in Greece and Germany, in S&B Industrial Minerals Group and
– in 2015 – in its new parent company, IMERYS. He concluded
his term there as Vice President of the former S&B Division and
Managing Director of S&B Industrial Minerals S.A.
In January 2016, he joined the management of TITAN Group,
where he has led, since 2020, its European business, as well as
Group Sustainability.
From 2016 to 2021, he served as Chairman of SEV Business
Council for Sustainable Development.
Alexandra Papalexopoulou
Executive Director
Alexandra Papalexopoulou is the Deputy Chair of the Group
Executive Committee, with direct oversight of Group Strategy
and Business Development, Trading, Legal and the Group’s
operations in the Eastern Mediterranean.
Her career began as an analyst for the Organization for Economic
Co-operation and Development (OECD) and later as an associate
at the consulting firm Booz Allen Hamilton in Paris in the 1990s.
Joining TITAN Group in 1992, she started out in trading,
subsequently moving to business development before heading
Strategic Planning.
She is a non-executive director of Coca-Cola HBC, an FTSE 100
company, an independent, non-executive director of Aegean
Group, a member of the Board and Treasurer of the Paul and
Alexandra Canellopoulos Foundation and serves on the Board of
Trustees of INSEAD Business School.
She holds a BA in Economics from Swarthmore College, USA, and
an MBA from INSEAD, France.
Stelios Triantafyllides
Independent Director – Member of the Remuneration Committee
Stelios Triantafyllides has been working with and been a partner
of Antis Triantafyllides & Sons LLC law firm since 1983. His
practice focuses on international business transactions, banking
and finance, capital markets, M&A and joint ventures, general
corporate and commercial, corporate restructuring, tax, financial
services and securities regulation. He is the legal adviser to
the Cyprus Securities and Exchange Commission. He regularly
advises major international companies on corporate and banking
matters.
He is member of the Cyprus Bar Association (admitted in 1984)
and a member of the Committee for Private Companies, of
which he served as Chairman until 2021. He is also member of
the Committee on the Cyprus Stock Exchange. From 2006 to
2012, he was a member of the Board of Directors of the Cyprus
Investment Promotion Agency (CIPA).
He studied at Worcester College, Oxford University (M.A. in
Jurisprudence), and at the University of California, Berkeley (LLM).
Dimitris Tsitsiragos
Independent Director – Member of the Audit and Risk Committee
Dimitris Tsitsiragos has over 30 years of extensive international
experience in emerging markets finance across industries,
sectors and products.
He started his career in 1985 in New York as a corporate bond
evaluator at Interactive Data Services Inc (former subsidiary
of Chase Manhattan Corporation). In 1989, he joined the
International Finance Corporation (IFC), a member of the World
Bank Group, as an Analyst and retired in 2017 as Vice President,
leading IFC’s global business operations and stakeholder
relations with a global network of governments, financial
institutions and private-sector clients. He also chaired IFC’s
Corporate Credit Committee. During his progressive career at
the institution, he held the following positions: Vice President,
Europe, Central Asia, Middle East and North Africa (EMENA)
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58
(2011-2014) based in Istanbul; Director of Middle East, North
Africa and Southern Europe (MENA) (2010-2011) based in Cairo;
Director of Global Manufacturing and Services Department
(2004-2010); Director of South Asia (2002-2004) based in New
Delhi; Manager, New Investments, Central and Eastern Europe
(2001-2002); Manager Oil and Gas (2000-2001) and held a
number of investment positions in the same unit (1989-2001).
Currently he is a Senior Advisor, Emerging Markets at the Pacific
Investment Management Company (PIMCO). He also sits on the
Board of Alpha Bank (Greece) as an independent director.
He holds an MBA from the George Washington University and
a BA in Economics from the Rutgers University. He has also
attended the World Bank Group Executive Development Program
at Harvard Business School.
Bill Zarkalis
Executive Director
Bill Zarkalis, in addition to his responsibilities as President and CEO
of Titan America LLC and Chairman of Separation Technologies
(STET) since 2014, has assumed the broader leadership role of
Group Chief Operating Officer (COO) and oversight of joint venture
Apodi in Brazil.
He is a business executive with an international career, having
led diverse global teams across all continents while located
mostly in the USA and Switzerland. He dedicated 19 years to Dow
Chemical Co., where he started in commercial posts, growing
in experience through a fast succession of marketing and
product management responsibilities, culminating into global
business-unit leadership roles. Among others, he served as Vice
President of Dow Automotive, M&A Leader for DuPont-Dow
Elastomers, Global Business Director for Specialty Plastics and
Elastomers and Global Business Director for Synthetic Latex.
He joined TITAN in 2008 as Group Executive Director for Business
Development and Strategic Planning. In 2010 he became the TITAN
Group Chief Financial Officer, where he served until 2014 before
moving into his current role leading Titan America.
He holds a BSc in Chemical Engineering from the National
Technical University of Athens and an MSc from the Pennsylvania
State University.
Mona Zulficar
Independent Director – Chairwoman of the Remuneration
Committee
Mona Zulficar is one of the founding partners of Zulficar & Partners
Law Firm, a specialized law firm, which has become one of the
best ranked law firms in Egypt since it was established in June
2009. She was previously senior partner at Shalakany Law Firm,
serving as the Chair of its Executive Committee for many years.
She is recognized in local and international legal circles as a
precedent setter and one of Egypt’s most prominent corporate,
banking and project finance attorneys. As an M&A and capital
markets transactions specialist, she has led negotiations on
some of Egypt’s and the Middle East’s largest and most complex
successful transactions over the past three decades. She has
also played an instrumental role in modernizing and reforming
economic and banking laws and regulations as a former member
of the Board of the Central Bank of Egypt and as a prominent
member of national drafting committees. She is also a leading
human rights activist, recognized locally and internationally and
has initiated several successful campaigns for new legislation
including women’s rights, freedom of opinion and family courts.
She served as Vice President of the Constitutional Committee of
50 and played a key role in drafting the 2014 Egyptian Constitution,
and has served as member of the National Council for Human
Rights for several terms ending September 2021. She has served
as Non-Executive Chairperson of EFG Hermes since 2008. In
2015, she was elected President of the Egyptian Microfinance
Federation and has chaired several NGOs active in providing social
development and microfinance to poor women. Internationally,
she served as an elected member of the international Advisory
Committee of the United Nations Human Rights Council for two
terms, ending in 2011.
She holds a BSc in Economics and Political Science from Cairo
University and an LLM from Mansoura University, as well as an
honorary PhD in law from the University of Zurich.
3.2 Role and competencies of the Board of Directors
The CG Charter, which is available on the Company’s website
(https://www.titan-cement.com/wp-content/uploads/2021/07/TCI-
CG_Charter_22.7.2021.pdf), defines the terms of reference of the
Board of Directors including its role, mission, composition, training
and evaluation.
3.3 Structure of the Board of Directors
As at 31 December 2021, the Board was composed of fifteen (15)
directors:
• The majority of directors, namely nine (9) out of fifteen (15),
including the Chairman, are non-executive directors.
• Eight (8) out of the fifteen (15) directors, namely Kyriakos Riris,
William Antholis, Andreas Artemis, Harry David, Lyn Grobler,
Stelios Triantafyllides, Dimitris Tsitsiragos and Mona Zulficar, met
on their appointment the independence criteria of article 7:87 of
the Belgian Code on Companies and Associations (the BCCA) and
also those of Provision 3.5 of the Code.
• Six (6) out of the fifteen (15) directors, namely Dimitrios
Papalexopoulos, Michael Colakides, Leonidas Canellopoulos, Yanni
Paniaras, Alexandra Papalexopoulou and Bill Zarkalis, are executive
directors.
• Three (3) out of the fifteen (15) directors are women. Τhe
Company’s primary listing on Euronext Brussels took place on
August 2019. Therefore, the Company is required to comply with
the gender diversity rule of 1/3 provided in article 7:86 of the BCCA
by 1 January 2025 at the latest. Nevertheless, the Company intends
to comply with the above rule, earlier than provided by law;
• The directors represent six (6) different nationalities (US,
Egyptian, UK, Cypriot, Greek and South African);
• The Board meeting attendance at the seven scheduled Board
meetings was 99.05%. The non-executive board members held
a meeting on 10 November 2021, in the absence of the Managing
Director and the other executive directors, in which the
attendance was 88.89% (8 out of 9). The individual attendance of
each Board member is shown in the table included in Section 3.4
(“Functioning of the Board of Directors”) below.
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Currently the Board consists of the following fifteen (15) directors:
Name Position Term started Term expires
Efstratios-Georgios (Takis) Arapoglou Chairman, Non-Executive Director July 2019 May 2022
Kyriacos Riris Vice-Chairman, Independent Non-Executive Director October 2018* May 2022
Dimitri Papalexopoulos Executive Director July 2019 May 2022
Michael Colakides Managing Director July 2019 May 2022
William Antholis Independent Non-Executive Director July 2019 May 2022
Andreas Artemis Independent Non-Executive Director July 2019 May 2022
Leonidas Canellopoulos Executive Director July 2019 May 2022
Haralambos (Harry) David Independent Non-Executive Director July 2019 May 2022
Lyn Grobler Independent Non-Executive Director December 2021 May 2022
Ioannis (Yanni) Paniaras Executive Director May 2021 May 2022
Alexandra Papalexopoulou Executive Director July 2019 May 2022
Dimitrios Tsitsiragos Independent Non-Executive Director March 2020 May 2022
Stylianos (Stelios) Triantafyllides Independent Non-Executive Director October 2018* May 2022
Vassilios (Bill) Zarkalis Executive Director July 2019 May 2022
Mona Zulficar Independent Non-Executive Director July 2019 May 2022
* Kyriacos Riris and Stelios Triantafyllides were reappointed as independent members of the Board of Directors by the Annual Shareholders' Meeting held on 13 May
2021 for a term of one year, namely until the Annual Shareholders' Meeting of 2022.
Individual attendance of each Board member at the scheduled meetings of the Board and the Board Committees
Director Board of
Directors
Meetings
Non-executive
Directors
Meetings
Audit and Risk
Committee
Meetings
Remuneration
Committee
Meetings
Nomination
Committee
Meetings
Efstratios-Georgios (Takis) Arapoglou 7/7 1/1 - - 1/1
Kyriacos Riris 7/7 1/1 6/6 - -
Dimitri Papalexopoulos 7/7 - - - -
Michael Colakides 7/7 - - - -
William Antholis 7/7 1/1 - 2/2 -
Andreas Artemis 7/7 1/1 - - 1/1
Leonidas Canellopoulos 7/7 - - - -
Harry David 7/7 1/1 6/6 - -
Yanni Paniaras 3/3
1
----
Alexandra Papalexopoulou 7/7 - - - -
Stelios Triantafyllides 7/7 1/1 - 2/2 -
Dimitris Tsitsiragos 7/7 1/1 6/6 - -
Maria Vassalou
2
6/7 0/1 - - 1/1
Bill Zarkalis 7/7 - - - -
Mona Zulficar 7/7 1/1 - 2/2 -
1
Yanni Paniaras was appointed as executive board member by the Annual Shareholders' Meeting held on 13 May 2021. Therefore, he participated in all board meetings
held after his appointment.
2
Maria Vassalou was a member of the Board of Directors until 31 December 2021. The Board decided to co-opt Lyn Grobler as independent director of the Company and
member of the Nomination Committee, effective 31 December 2021.
3.4 Functioning of the Board of Directors
During 2021, the Board of Directors held seven (7) scheduled meetings on 20 January, 22 March, 8 April, 12 May, 27 July, 4-5 October and 10
November 2021.
The following table shows the individual attendance of each Board member at the meetings of the Board and its committees held in 2021:
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3.5 Board evaluation
As provided in the Code, the Board should assess at least
every three years its own performance, its interaction with
the executive management, as well as its size, composition,
functioning and that of its committees.
After the completion of one and a half year as a listed Company
primarily on Euronext Brussels with secondary listings on the
Athens Exchange and on Euronext Paris, in December 2020 the
Board carried out a formal Board evaluation without external
facilitation.
Each Board member received a questionnaire, in the form of a
survey link, comprising of 33 questions, ensuring the anonymity
of each participant and requesting feedback on how the Board
functions, its composition, effectiveness and operation, the role
of the Chair and the functioning of the Board committees. All
Board members responded to the questionnaire and the Board
evaluation feedback was presented and discussed at the first
Board meeting of 2021.
Given that the term in office of all Board members will end on
12 May 2022, the Nomination Committee will evaluate each
member’s presence at the Board or Committee meetings and
their commitment and constructive involvement in discussions
and decision-making, in accordance with a pre-established and
transparent procedure. The Nomination Committee will also
assess whether the contribution of each Board member adapted
to changing circumstances.
3.6 Code of Conduct – Conflicts of interest
A Code of Conduct has been drawn-up, setting out the
expectations for the Company’s leadership and employees in
terms of responsible and ethical behavior.
All Board members should uphold the highest standards of
integrity and always act in the best interest of the Company.
Each member of the Board, both during his or her membership
of the Board and afterwards, should not disclose to anyone in
any manner any confidential information relating to the business
of the Company or companies in which the Company has an
interest, unless he or she has a legal obligation to disclose such
information.
No member of the Board may use the information described
above to his or her own advantage.
Each member of the Board undertakes not to develop, either
directly or indirectly, during the term of his or her mandate,
any activities nor perform any actions that conflict with the
activities of the Company or its Subsidiaries.
All members of the Board are required to inform the Board of
conflicts of interests as they arise. In case a director has a direct
or indirect financial interest that conflicts with the interests of
the Company, he or she is required to inform the other directors
before the Board takes a decision and the Board is required to
implement the procedures set forth in articles 7:96 and 7:97
of the BCCA. Pursuant to the above articles of the BCCA, the
following decisions took place, without the presence of one or
more executive members of the Board:
1. Resolution of the meeting of the Board of Directors held on 20
January 2021: Amendment to the 2020 LTIP approval decision of
9 April 2020
On 20 January 2021, the Board decided to amend the 2020 Long
Term Incentive Plan (the 2020 LTIP) approval decision of the Board
taken at the meeting of 9 April 2020. The conflict of interest
relates to the fact that the amendment would benefit the Cyprus-
based executive directors, namely Michael Colakides and three
members of the Group Executive Committee based in Cyprus,
Christos Panagopoulos, Fokion Tasoulas and Grigoris Dikaios. Mr.
Colakides, in his capacity as member of the Board of Directors,
declared that he had a potential conflict of interest pursuant to
article 7:96 of the BCCA and withdrew from the meeting.
The amendment of the 2020 LTIP provided that, instead of
“shadow shares” the above senior executives based in Cyprus
would receive in their individual accounts in the “Kronos Special
Pension Fund” the number of fund units corresponding to the
same number of “shadow shares”, once they would mature. The
value of the award will be the same. The above action does not
impact the principles of the 2020 LTIP nor the grants awarded.
The relevant awards were approved by the Board at the meeting
of 9 April 2020, but the Cyprus Ministry’s tax ruling regarding
their treatment in Cyprus was only received in December 2020.
Following relevant deliberation, the Board, in the absence of
Michael Colakides, decided unanimously and by separate votes
to approve the above proposed amendment of the 2020 LTIP.
2. Resolution of the meeting of the Board of Directors held on 22
March 2021
The following decisions were taken, in the absence of the executive
members of the Board of Directors, namely Michael Colakides,
Leonidas Canellopoulos, Alexandra Papalexopoulou, Dimitri
Papalexopoulos and Bill Zarkalis, who declared that they had a
possible conflict of interest, pursuant to article 7:96 of the BCCA:
a. to approve the variable remuneration payouts (bonuses) for
2020 of the executive members of the Board, the members of
the Management Committee and the members of the Group
Executive Committee, as included in the Remuneration Report
for the year 2020, noting that the relevant variable remuneration
payouts, which amount in total to €2,744,316, are paid in
accordance with the provisions of the 2020 Remuneration Policy
and following the appraisal of the performance of each executive
director and the achievement of personal and collective targets
provided in the Remuneration Policy;
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b. to approve the long-term incentive awards to be granted in
2021 to the executive members of the Board, the members of
the Management Committee and the members of the Group
Executive Committee, as recommended by the Remuneration
Committee, noting that the value of such long-term incentive
awards amount in total to €2,572,000 and are granted subject to
the achievement of personal and collective targets provided in
the 2020 Remuneration Policy; and
c. to approve the implementation of the Deferred Compensation
Plan as presented, noting that the awards granted amount in
total to €643,000.
The conflict of interest is related to the fact that the executive
members of the Board are beneficiaries of the variable
remuneration payouts of 2020, the long-term incentive awards
to be granted in 2021 and the implementation of the Deferred
Compensation Plan.
The Board has set (a) a Policy for transactions and other
contractual relationships between the Company or Group
Subsidiaries and members of the Board or the Management
Committee or the Group Executive Committee or other
designated persons and (b) a Dealing Code, which is addressed
to the Company’s directors, managers and officers, as well as
to Group’s directors, managers, officers and employees who are
in possession of inside information (within the meaning of the
Regulation (EU) No 596/2014 on market abuse).
The Policy for Transactions and the Dealing Code are included
(as Appendix 2 and Appendix 8, respectively) in the Company’s
CG Charter which is available on the Company’s website (https://
www.titan-cement.com/wp-content/uploads/2021/07/TCI-CG_
Charter_22.7.2021.pdf).
4. Composition and Operation of Board Committees
4.1 Audit and Risk Committee
4.1.1 Composition, Role and Functioning
Chair: Kyriacos Riris, independent director
Members: Harry David, independent director
Dimitris Tsitsiragos, independent director
With a career spanning some 40 years, the Chairman of the
Audit and Risk Committee has accumulated vast experience in
auditing and accountancy. Likewise, Harry David and Dimitris
Tsitsiragos, have collective expertise regarding the activities of
the Company.
The Audit and Risk Committee performs all duties set out in
article 7:99 of the BCCA and is entrusted with the development
of a long-term audit program encompassing all activities of the
Company, including:
a. monitoring the financial reporting process;
b. monitoring the effectiveness of the Company’s internal
control and risk management systems;
c. monitoring the internal audit and its effectiveness;
d. monitoring the statutory audit of the annual and consolidated
financial statements, including any follow-up on any questions
and recommendations made by the External Auditor;
e. reviewing and monitoring of the independence of the External
Auditor, in particular regarding the provision of additional
services to the Company.
The Audit and Risk Committee held six meetings in 2021: on 22
February, 22 March, 8 April, 11 May, 27 July and 9 November 2021.
The discussions and decisions of the Audit and Risk Committee
meeting held on 22 February 2021 included: the presentation
by the external auditors (PwC) of the audit plan for the year
ended 31 December 2020; the presentation by the Head of the
Group’s Internal Audit, Risk and Compliance Department of
the full activity report for the year 2020 and the update on the
Company’s internal control environment; the presentation by
the Head of the Group’s Internal Audit, Risk and Compliance
Department of the fraud and whistleblowing cases reported in
2020; the presentation by the Group IT Manager of the Cyber
Security status of the Company and the measures taken; the
presentation by the General Counsel of the Company of the legal
cases that may potentially have a significant negative effect on
the financial statements of the Company.
The discussions and decisions of the Audit and Risk Committee
meeting held on 22 March 2021 included: the presentation of the
condensed financial statements for the year ended 31 December
2020, the relevant financial statements and the press release for
the fourth quarter and the year end results; the presentation by
the external auditors (PwC) of their report on the consolidated
financial statements for the year 2020 and a discussion on their
findings; the approval of non-audit services (NAS) provided in Q1
(following management’s approval).
The discussions and decisions of the Audit and Risk Committee
meeting held on 8 April 2021 included: the presentation and
recommendation for approval of the Integrated Annual Report
for the year 2020; the presentation and recommendation for
approval of the stand-alone financial statements for the year
ended 31 December 2020 of Titan Cement International S.A.;
the presentation by the external auditors (PwC) of their audit
reports on the Integrated Annual Report and the stand-alone
financial statements of Titan Cement International S.A. for
the year ended 31 December 2020 (both unqualified); a brief
discussion on the Management Letter which would be repeated
at a date after the Annual Shareholders' Meeting.
The discussions and decisions of the Audit and Risk Committee
meeting held on 11 May 2021 included: the presentation of the
new Audit Engagement Partner of PwC Réviseurs d’Entreprises
SRL, Didier Delanoye, who replaced Marc Daelman as of 13 May
2021; the presentation and recommendation for approval of the
unaudited condensed financial statements for the first quarter
ended 31 March 2021 and the press release for the same period;
the discussion with the Head of the Group’s Internal Audit, Risk
and Compliance Department of the status of implementation
of the Internal Audit plan during Q1, the findings of this period,
the compliance and anti-fraud activities performed and other
matters.
The discussions and decisions of the Audit and Risk Committee
meeting held on 27 July 2021 included: the presentation of the
interim condensed financial statements of the half year 2021
and the press release for the same period; the approval of NAS
provided in Q2 (following management’s approval); a discussion
on the findings of the external auditors (PwC) in respect of the
interim condensed financial statement and their unqualified
report for the same period; a discussion with the external
auditors (PwC) on the quality review control of PwC Réviseurs
d’Entreprises SRL executed by the CTR/CSR; the status of
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TITAN CEMENT GROUP
62
implementation of the Internal Audit Plan; the Q2 activity report
of the Group Audit Risk and Compliance Department.
Finally, the discussions and decisions of the Audit and Risk
Committee meeting held on 9 November 2021 included: the
presentation of the unaudited condensed financial statements
of Q3 2021 and the 9 months press release; the presentation of
the 2021 Audit Plan by the External Auditors (PwC); the extensive
discussion of the 2020 Management Letter; the approval of NAS
provided in Q3 (following management’s approval); the discussion
with the Head of the Group’s Internal Audit, Risk and Compliance
Department, without the presence of any member of the
management team, of the status of implementation of the Internal
Audit Plan; the Q3 activity report of the Group Audit, Risk and
Compliance Department, the compliance and anti-fraud activities
performed, one new whistleblowing case and other matters.
4.1.2 External Auditor
The audit of the Company’s financial statements was entrusted,
by virtue of the resolution of the Extraordinary General Meeting
of Shareholders dated 13 May 2019, as amended by virtue of
the resolution of the Annual General Meeting of Shareholders
dated 13 May 2021, to PriceWaterhouseCoopers, Réviseurs
d’Entreprises SRL, with registered office located at Culliganlaan
5, 1831 Machelen, Brussels, represented by Mr. Didier Delanoye,
for a term of three years, ending on the date of the Annual
General Meeting of Shareholders to be held in 2022 related to
the approval of the annual accounts for the year ending on 31
December 2021.
The responsibilities and powers of the External Auditor are set
by law.
The Audit and Risk Committee monitors and assesses the
effectiveness, independence and objectivity of the external
auditor having regard to the:
• content, quality and insights on key external auditor plans and
reports;
• engagement with the external auditor during committee
meetings;
• robustness of the external auditor in handling key accounting
principles; and
• provision of non-audit services.
The yearly 2021 audit fees for the statutory accounts of Titan
Cement International S.A. (TCI) were set at €117,200 (plus VAT,
out of pocket expenses and the IRE/IBR fee) (€109,000 in 2020).
The audit fees for Group and statutory audit of TCI subsidiaries
and affiliates in 2021 amount to €1,397,795 (€1,207,861 in 2020).
Non-audit fees (for TCI, subsidiaries and affiliates) paid or
accrued in 2021, amount to €187,116 (€334,637 in 2020) and
include:
• Audit related fees (assurance services for TCI, subsidiaries and
affiliates) €168,055 (€298,596 in 2020);
• Tax advisory, other advisory and compliance services €19,061
(€36,041 in 2020).
The rules governing the composition, tasks and method of
functioning of the Audit and Risk Committee are laid down in
Appendix 3 of the Company’s CG Charter (“Terms of Reference
of the Audit and Risk Committee”), which is available on the
Company’s website (https://www.titan-cement.com/wp-content/
uploads/2021/07/TCI-CG_Charter_22.7.2021.pdf).
4.2 Remuneration Committee
Chair: Mona Zulficar, independent director
Members: William Antholis, independent director
Stelios Triantafyllides, independent director
The Remuneration Committee has the duties set out in article
7:100 of the Belgian Companies and Associations Code, including,
to prepare and assess proposals for the Board with regard to:
a. the Company’s remuneration policy and the remuneration of
directors, members of the Company’s Management Committee
and members of the Group Executive Committee, as well as on
the arrangements concerning early termination;
b. the annual review of the executive management’s
performance; and
c. the realization of the Company’s strategy against performance
measures and targets.
The Remuneration Committee held two meetings in 2021: on 19
March and 22 November 2021.
The main topics of the meeting of the Remuneration Committee
held on 19 March 2021 referred to recommendations of the
Committee on:
a. the variable remuneration payouts for 2020 based on the
actual collective performance versus targets;
b. the vesting of the stock options awarded in 2018;
c. the salary increases for 2021, bonus payout for 2020 and LTIP
awards for 2021 for the executive members of the Board, the
members of the Management Committee, the members of the
Group Executive Committee and the Group Internal Audit, Risk
and Compliance Director;
d. the implementation of the Deferred Compensation Plan;
e. the Remuneration Report for the year 2020.
The topic of the meeting of the Remuneration Committee held
on 22 November 2021 referred to the approval by the Committee
of a deferred cash bonus payment to one executive director (Mr.
Bill Zarkalis) as provided by his contract. The relevant decision
was approved by the Board of Directors on 18 January 2022 and
for this reason it is not included in section 3.6 “Code of Conduct
– Conflicts of interest” of the Corporate Governance Statement
of 2021.
The rules governing the composition, tasks and method of
functioning of the Remuneration Committee are laid down in
Appendix 5 of the Company’s CG Charter (“Terms of Reference
of the Remuneration Committee”), which is available on the
Company’s website (https://www.titan-cement.com/wp-content/
uploads/2021/07/TCI-CG_Charter_22.7.2021.pdf).
4.3 Nomination Committee
Chair: Efstratios-Georgios (Takis) Arapoglou, non-executive
director
Members: Andreas Artemis, independent director
Lyn Grobler, independent director
The role of the Nomination Committee is to make
recommendations to the Board with regard to the appointment
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CORPORATE GOVERNANCE AND RISK MANAGEMENT
63
of new members in the Board of Directors, the Managing
Director, members of the Management Committee and the
Group Executive Committee, as well as their orderly succession.
The main duties of the Nomination Committee include:
a. the nomination of candidates for any vacant directorships, for
approval by the Board;
b. the preparation of proposals for reappointments;
c. the periodical assessment of the size and composition of the
Board and making recommendations for any changes; and
d. ensuring that sufficient and regular attention is paid to the
succession of executives, talent development and promotion of
diversity in leadership positions.
The Nomination Committee meets at least once a year and
whenever a meeting is deemed necessary and advisable for its
proper functioning.
During 2021, the Nomination Committee held one meeting on 2
November 2021.
The main topics of the meeting of the Remuneration Committee
held on 2 November 2021 referred to the presentation of Lyn
Grobler as potential Board candidate to replace Maria Vassalou,
subject to the confirmation of the mandate by the next general
meeting, and the presentation of two more women as potential
new Board candidates, in order to increase the number of
women in the Board to five (5).
The rules governing the composition, tasks and method of
functioning of the Nomination Committee, as well as the
procedure to be followed by the latter for the appointment and
reappointment of Board members, are laid down in Appendix
4 of the Company’s CG Charter (“Terms of Reference of the
Nomination Committee”), which is available on the Company’s
website (https://www.titan-cement.com/wp-content/
uploads/2021/07/TCI-CG_Charter_22.7.2021.pdf).
4.4 Management Committee
Chairman: Michael Colakides, Managing Director and Group CFO
Members: Grigoris Dikaios, Company CFO
Christos Panagopoulos, Regional Director East Med
The main role and main duties of the Management Committee
are to implement and monitor the company strategy, to prepare
and present to the Board the financial statements of the
Company in accordance with the applicable accounting standards
and policies of the Company, to prepare the Company’s required
disclosure of the financial statements and other material
financial and non-financial information, to manage and assess
the internal control systems of the Company and to support
the Managing Director in the day-to-day management of the
Company and the performance of his other duties.
The Management Committee meets whenever a meeting is
required for its proper functioning.
The rules governing the composition, tasks and method of
functioning of the Management Committee, as well as the code
of conduct, are laid down in Appendix 6 of the Company’s CG
Charter (“Terms of Reference of the Management Committee”),
which is available on the Company’s website (https://www.
titan-cement.com/wp-content/uploads/2021/07/TCI-CG_
Charter_22.7.2021.pdf).
4.5 Group Executive Committee
Chair: Dimitri Papalexopoulos
Deputy Chair: Alexandra Papalexopoulou
Members: Michael Colakides, Managing Director and Group
CFO
Leonidas Canellopoulos, Group Chief
Sustainability Officer
Michael Chivers, Group Human Resources Director
Antonis Kyrkos, Group Transformation and
Strategic Planning Director
Yanni Paniaras, Group Executive Director Europe
and Sustainability
Christos Panagopoulos, Regional Director Eastern
Mediterranean
Fokion Tasoulas, Group Innovation and Technology
Director
Bill Zarkalis, Group Chief Operating Officer
– President and CEO of Titan America LLC –
Chairman of STET
The role of the Group Executive Committee is to facilitate
the supervision of the Group operations, the cooperation
and coordination between the Company’s subsidiaries and
the monitoring of the Group management performance,
while ensuring the implementation of decisions and related
accountability.
Τhe Group Executive Committee held 19 meetings during
2021. A variety of coordination topics were covered, including
strategy, quarterly results, Group budget, H&S reviews,
sustainability issues, HR issues, procurement, progress of key
projects (decarbonization, digitalization), trading activities,
diversification, risk, etc.
The rules governing the composition, tasks and method of
functioning of the Group Executive Committee, as well as the
code of conduct, are laid down in Appendix 7 of the Company’s
CG Charter (“Terms of Reference of the Group Executive
Committee”), which is available on the Company’s website
(https://www.titan-cement.com/wp-content/uploads/2021/07/
TCI-CG_Charter_22.7.2021.pdf).
5. Diversity and Inclusion
TITAN is committed to offering equal opportunities and
encourages diversity and inclusion at every level of employment
in the Company. Diverse and inclusive workplace has been
recognized as a material issue for the Group. Diversity includes
gender, age, nationality, disability, ethnic origin, sexual
orientation, culture, education and professional background.
At Group level, particular attention is given to monitoring the
implementation of our Human Rights Policy, part of which
refers to the promotion of diversity and to ensuring consistent
improvement of diversity across the organization. Improving the
gender mix at all levels is always an area of focus. Likewise, we
focus on inclusion and on creating a working environment that
maximizes the potential of all employees.
Currently, the number of women on the Board is 3 out of 15.
However, the Company intends to comply with the 1/3 gender
diversity rule, earlier than provided by law, by increasing the
number of women serving on the Board.
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
64
The Board has also promoted diversity in the composition of
the Board Committees, by appointing a woman as Chair of the
Remuneration Committee and another woman as a member of the
Nomination Committee.
TITAN monitors gender diversity in management at both Group
and local levels (see ESG Performance statements, table 2.2 Focus
area growth enabling work environment).
In 2019, an assessment of Group policies was conducted by the
Group Human Resources Department to define priorities and
future targets accordingly. Our Group Code of Conduct, Human
Rights and CSR policies were updated to incorporate clearer
references to diversity and inclusion.
Diversity at the Board level has also been promoted through
a balanced mixture of academic and professional skills. More
specifically, the Board includes directors from a variety of sectors,
including, among others, banking and insurance, corporate/
business, audit services, public policy and political history, the
cement sector, emerging markets and finance, legal services,
technology and IT.
As far as residence is concerned, six Board members have their
permanent residence in Cyprus, two in the USA, four in Greece,
one in Egypt and two in the UK.
The Group focuses on fostering diversity and inclusion awareness
through workshops, training and development programs in the
various regions.
The results of diversity promotion in 2021 are published in the ESG
Performance review and statements, table 2.2 Focus area growth
enabling work environment.
6. Internal Audit and Risk Management in the Scope of the
Financial Reporting Process
The key elements of the system of internal controls utilized in
order to avoid errors in the preparation of the financial statements
and to provide reliable financial information are the following:
The assurance mechanism regarding the integrity of the Group’s
financial statements consists of a combination of the embedded
risk management processes, the applied financial control
activities, the relevant information technology utilized, and the
financial information prepared, communicated and monitored.
Each month the Group’s subsidiaries submit financial and non-
financial data to the Group’s consolidation department and
provide explanatory information where necessary.
In consolidating the financial results and statements, the Group
utilizes specialized consolidation software and specialized
software for reconciling intercompany transactions. These
tools come with built-in control mechanisms and have been
parametrized in accordance with the Group’s needs. Finally,
the above tools use best practices regarding the consolidation
process, which the Group has to a very large extent adopted.
The Group’s management reviews on a monthly basis the
consolidated financial statements and the Group’s Management
Information (MI) – both sets of information being prepared
in accordance with IFRS and in a manner that facilitates their
understanding.
The monthly monitoring of the financial statements and Group MI
and their analysis by the relevant departments are key elements
of the controlling mechanism regarding the quality and integrity of
financial results.
The Group’s external auditors review the mid-year financial
statements of the Group and its material subsidiaries and audit
their full-year financial statements. Moreover, they audit the full-
year financial statements of the Company. In addition, the Group’s
external auditors inform the Audit and Risk Committee about the
outcome of their reviews and audits.
The Audit and Risk Committee, during its quarterly meetings prior
to the financial reporting, is informed by the Managing Director
and Group CFO and by other competent officers of the Company
and the Group about the performance of the Group, monitors the
consolidated accounts and the financial reporting process and
reports accordingly to the Board. The Audit and Risk Committee
monitors the financial reporting process and the effectiveness
of the Group’s and the Company’s internal control and risk
management systems.
The approval of the financial statements (Company and
Consolidated) by the Board is made after the relevant
recommendation of the Audit and Risk Committee.
7. Internal Audit
The internal audit is carried out by the Group Internal Audit
function. As of January 2020, the function assumed a broader
role, taking over responsibility for risk and compliance, in
addition to the internal audit.
Internal Audit is an independent department with its own
written regulation, reporting directly to the Audit and Risk
Committee.
The Group Internal Audit workforce consists of 18 executives
duly trained and having appropriate experience to carry out their
work. Two (2) new hires were added in early 2021.
Internal Audit’s primary role is to monitor the effectiveness of
the internal control environment. Internal Audit’s scope also
includes:
• monitoring implementation and compliance with the
Company’s Internal Regulation, Code of Conduct, Articles of
Association and applicable laws in all jurisdictions in which the
Group operates;
• providing consulting services (e.g. new procedures review, new
IT systems post-implementation reviews);
• undertaking special assignments (e.g. fraud investigations).
During the year, the Audit and Risk Committee received in total
35 internal audit reports. Likewise, the Audit and Risk Committee
received all progress reports referring to the most important
audit findings in 2021.
As already mentioned in the section referring to the work and
function of the Audit and Risk Committee, in all meetings held by
the Audit and Risk Committee, the Head of the Group’s Internal
Audit, Risk and Compliance Department participated. The Head
of the Group’s Internal Audit, Risk and Compliance Department
had a number of meetings with the Chairman of the Audit and
Risk Committee pertaining to the better preparation of the Audit
and Risk Committee meetings with regard to the Internal Audit.
Following the relevant recommendation of the Audit and Risk
Committee, the Board of Directors approved the Internal Audit
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65
Plan for the year 2022 and specified the functions and areas on
which internal audit should primarily focus.
8. Remuneration report 2021
In accordance with the applicable provisions, this Remuneration
Report describes the remuneration paid on an individual basis
to the members of the Board of Directors and the members of
the Management Committee, who are in charge of the daily
management.
8.1 Introduction
In 2021 the fundamentals driving demand across our markets,
namely the strong recovery of economic activity and a rise
in public and private investment against a low interest rate
environment, stimulated growth. It was a year of robust
performance for TITAN Cement Group, although the second half
of 2021 was marked by the surge in fuel, electricity and shipping
freight costs which held back profitability.
The Group generated record revenues of €1,714.6 million, up 6.7%
from 2020, reflecting higher demand and a supportive pricing
environment. Due to the unexpected spike of input costs after
the first semester and despite pricing initiatives that partly
alleviated the burden, Earnings Before Interest, Tax, Depreciation
and Amortization (EBITDA) declined by 3.6% to €275.2 million. Net
Profit after Taxes and minorities (NPAT) climbed to €91.9 million
(vs. €1.1 million in 2020 and €50.9 million in 2019). This significant
increase was the result of lower finance costs, more favourable FX
movements and a lower effective tax rate. It should be noted that
in 2020 there were €63.9 million one-off charges related to Egypt.
Thanks to a successful refinancing strategy for a third consecutive
year the Group lowered significantly its finance costs to €33.6
million (€19 million lower than 2020 and €30 million lower than
2019).
US operations marked a new milestone with sales revenue at
record levels thanks to growing demand, underpinned by healthy
macroeconomic conditions. In Greece, the market continued its
positive performance, lending further support to the belief that
demand is solidly in the upward path of the business cycle. In
Southeastern Europe performance was robust. Performance in
the Eastern Mediterranean turned positive, thanks to the mix
of demand pick-up and better pricing dynamics in Egypt, while
in Turkey, despite the volatile economic situation, the Group
recorded revenue growth as well. Finally our Brazilian operations
continued to grow significantly.
8.2 Remuneration Policy
The 2020 Remuneration Policy was approved by the Annual
General Meeting of Shareholders that was held on 14 May 2020
and is aligned to a great extent with the implementation of the
European Shareholder Rights Directive II (“SRD II”).
The 2020 Remuneration Policy ensures that TITAN is
remunerating on the basis of the Company’s short and long-term
business plan, so as to continue creating value for customers,
shareholders, employees, societies and economies.
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
8.3 Target Pay Mix
The following pie charts represent the fix/variable pay mix for
the Executive Directors and the members of the Management
Committee (on aggregate target average) in case of ‘on-target’
performance and reflects the underlying pay-for-performance
principles and market-competitive reference of the
Remuneration Policy.
29%
Short-Term Incentive
Plan (STIP)
Long-Term
Incentive Plan (LTIP)
Fixed Remuneration
MANAGEMENT COMMITTEE (AGGREGATE)
26%
45%
BOARD EXECUTIVE DIRECTORS (AGGREGATE)
Short-Term Incentive
Plan (STIP)
Long-Term
Incentive Plan (LTIP)
Fixed Remuneration
32%
29%
39%
The total amount of remuneration of the Executive Directors and
the member of the Management Committee is in line with the
Remuneration Policy adopted, linked to strategy, mechanisms
and relevant performance measures and contributes to the
long-term performance of the Company.
Main principles that govern the Remuneration Policy and
contribute to the Company’s business strategy and sustainability
are:
• Establish a fair and appropriate level of fixed remuneration
aiming at attracting high caliber senior professionals who can
add value to the Company.
• Maintain a balanced approach between fixed and variable
remuneration, so as to avoid over relying on variable pay and
undue risk taking.
• Establish a balanced approach between short and long-term
incentives, to ensure there is focus on short term objectives
that will ultimately contribute to the creation of long-term value
creation.
• Alignment of executives to shareholder interests and long-term
value creation through long-term incentives where the reward is
linked to company shares.
• Avoidance of undue risk taking by focusing on financial and
non-financial performance metrics in variable pay design.
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8.5 Variable pay schemes
Short Term Incentive Scheme and Long-Term Incentive Plan awards are treated in accordance with the rules of the relevant plans.
Element of
Remuneration
Overview
Short-Term
Incentive Scheme
Target payout:
Executive Directors of the Board and the Management Committee: up to 100% of Annual Base Salary
Maximum: In case of overachievement, the collective part of the STI is capped at 130% of target, the
individual part at 150% (in case of extraordinary performance) and the safety part at 200%
Performance Criteria:
• Financial Performance (up to 45%): EBITDA
• Individual Performance (up to 55%): combination of objectives and behaviors
• Safety (5%): Lost Time Injury Frequency Rate
Long-Term
Incentive Plan
(LTIP)
A new Long Term Incentive Plan (LTIP) applied in 2020 in line with the approved 2020 Remuneration Policy.
Awards are granted to the plan participants in the form of a conditional grant of TCI shares. The individual
awards granted are based on each participant’s position, fixed salary, individual performance and potential
for development.
The LTIP award granted to each participant is approved by the Board of Directors following relevant
recommendation by the Remuneration Committee.
The award has been defined up to 125% of Annual Base Salary for the Management Committee and the
Executive Directors of the Board.
The conditional grant of the number of TCI shares is determined based on the value of the TCI share at the
time of grant. The value of each “conditionally granted share” is equal to the average TCI share closing price
on Euronext Brussels during the last 7 trading days of March of the grant year.
The vesting schedule is 50% on year 3, 50% on year 4. Upon the completion of the vesting period, the
benefit of the employee is determined based on the value of TCI share at the time of vesting.
Upon vesting the LTIP provides the flexibility to the eligible Executive, upon her/ his request, to receive the
vested award as contribution to a company-provided pension plan investing mainly in TCI shares (Fund).
Participants are expected to maintain in TCI shares (or Fund(s)) at a minimum 20% of the total awards
vested during the last five (5) vesting years (rolling basis). TCI shares, as well as Fund(s) balance, already
owned by participants through previous LTI plans will be taken into consideration.
Special Trust Fund Plan (Fund)
Special Trust fund is a fund which invests in TCI shares. LTIP participants may elect to receive their LTIP
award as contributions in the Fund, and therefore their long term interests are still linked to TCI share.
8.4 Labor Market
In setting the remuneration levels for the Managing Director, as
well as of the other Executive Directors and the members of the
Management Committee, the Remuneration Committee gathers
market insights from various relevant perspectives. These reflect
the relevant industries for the Company, the relevant geographies
(e.g. Europe, and for specific positions the U.S.), and also take into
consideration the size and the scope of the Company and the
respective positions.
The Remuneration Committee regularly reviews the Remuneration
Policy, in order to ensure continuous alignment with its principles,
as well as market trends and best practices. On an annual basis,
the Remuneration Committee recommends the levels of the
annual remuneration of the Executive Directors and the members
of the Management Committee, as well as of other Group
executives on the basis of their performance and responsibilities.
The Committee also recommends the levels of remuneration of
Non-Executive Directors on the basis of their time commitment
and responsibilities.
In case of substantial changes, and at least every four years, the
Remuneration Policy is submitted for approval to the General
Meeting.
The level of remuneration for the Chairman of the Board
of Directors is decided by the General Meeting, following
respective recommendation of the Board of Directors and of the
Remuneration Committee. Likewise, the level of remuneration
for the Managing Director and the members of the Management
Committee, is set by the Board of Directors, following relevant
recommendation of the Remuneration Committee and in line with
the applicable Remuneration Policy.
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INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
Element of
Remuneration
Overview
Deferred
Compensation
Plan (DCP)
As of 2021, the Company launched a Deferred Compensation Plan (“DCP 2021”) aiming at further aligning
the Senior Executives’ long-term interests with those of shareholders. The DCP 2021 substitutes 20% of
the LTIP of the eligible executives.
Target payout:
The award has been defined up to 25% of Annual Base Salary for the Management Committee and the
Executive Directors of the Board.
Maximum: In case of overachievement, the DCP is capped at 160% of target.
Performance Criteria:
• Sustainability KPI: a 3-year CO₂ target supporting the decarbonization priority of the Group; reduction of
net direct CO₂ emissions/t cementitious product (50%).
•Total Shareholder Return (TSR) performance vs a Peer Group Index (50%).
The peer group which formulates the index is the following (as set by the Board of Directors and may be
changed, if required):
1. Lafarge-Holcim 5. CRH
2. Heidelberg 6. Buzzi
3. Cemex 7. Argos
4. Cementir 8. Vicat
The performance period is 3 years. Flexibility is provided in ways to receive vested benefit (e.g. cash, pension
plan contributions).
Retirement
Allowance
Type of Plan:
Defined contribution plan
Maximum contribution: up to 10% of Annual Base Salary
Plan mechanism:
First tier: up to 8% of Annual Base Salary.
Second-tier: in addition to the 1st tier 8%, a further up to 2% is offered through matching the employee’s
contribution by a ratio of 1:2.
In the event Executives leave the Company prior to 5 years from the entry to the Program, any
contributions by the Company are lost.
No specific clauses and/or arrangements in relation to change in control are applicable. No variable remuneration claw back
mechanisms were used during FY2021.
8.6 Non-executive Directors’ remuneration in 2021
As at 31 December 2021, the fees of the Non-Executive Directors for the year 2021, amounted to:
Non-Executive Director
Compensation by the Company
Board of Directors Board Committees Pro-bono allowance
Eftrsatios-Georgios (Takis) Arapoglou €200,000 gross €15,000 gross No
Andreas Artemis €50,000 gross €10,000 gross No
William Antholis €50,000 gross €8,000 gross No
Harry David €50,000 gross €15,000 gross No
Lyn Grobler
as of 31 December 2021 member
of the Nomination Committee
---
Kyriacos Riris €50,000 gross €20,000 gross No
Stelios Triantafyllides €50,000 gross €8,000 gross No
Maria Vassalou
until 31 December 2021
€30,000 gross
€3,750 gross
Paid for period 1-25 July 2021
No
Dimitris Tsitsiragos €50,000 gross €15,000 gross €5,000
Mona Zulficar €50,000 gross €12,000 gross No
According to the 2020 Remuneration Policy, non-executive directors do not receive variable compensation linked to results or other
performance criteria. As a result, non-executive directors are not entitled to annual bonuses, stock options or performance share units.
Neither are they entitled to any supplemental pension scheme.
Non-executive members of the Board are not entitled to termination payment.
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Executive Directors of the Board and Management Committee Remuneration packages in 2021
Name
Annual
Base Salary
Board Fees
Allowances and
Other Benefits
1
Annual Variable
Compensation
2
Pension
Contribution
3
Long-Term
Incentives
(vested in 2021)
Total Annual
Compensation
Fixed
Compensation
Variable
Compensation
Total Annual
Compensation
Total Annual
Compensation
Year 2021 2020 2019
Board Executive Directors
Michael Colakides,
Managing Director
426,150 45,000 32,139 363,743 42,615 138,782 1,048,429 52% 48% 1,075,190 1,124,092
Dimitri Papalexopoulos,
Chairman of Group Executive
Committee
514,547 30,000 18,652 513,939 51,225
242,398
1,370,760 45% 55% 1,381,193 1,432,979
Alexandra Papalexopoulou,
Deputy Chair of Group
Executive Committee
394,462
30,000 33,702 335,214 39,270 155,698 988,347 50% 50% 980,443 909,587
Leonidas Canellopoulos 198,386 30,000 15,615 116,410 21,774 18,493 400,678 66% 34% 283,046 248,366
Yanni Paniaras* 238,542 19,000 17,072 185,108 23,750 107,651 591,122 50% 50% - -
Bill Zarkalis** (in €) 642,301 30,000
248,488
563,327 47,861 186,126 1,718,102 56% 44% 1,561,012 1,627,556
Takis-Panagiotis
Canellopoulos***
---------85,065308,000
Management Committee Members
Grigoris Dikaios 188,580 0 34,079 63,363 11,315 18,187 315,524 74% 26% 316,092 306,617
Christos Panagopoulos
274,800
0 108,215 152,722 26,480 61,442 623,659 66% 34% 591,567 581,835
Konstantinos Derdemezis**** ---------614,685 647,087
* Amounts refer to period May-December 2021 during which Yanni Paniaras was Board Executive Director.
** Amounts include allowances linked to Bill Zarkalis' international assignment in the US and part of the Deferred 3-year assignment success bonus linked to 2021.
Amounts, paid in $, are converted into euro based on fx rate €/$ of 31 December 2021 for 2021, on 31 December 2020 for 2020 and on 31 December 2019 for 2019
figures respectively.
*** Takis-Panagiotis Canellopoulos was Board Executive Director till March 2020.
**** Konstantinos Derdemezis was member of the Management Committee till October 2020. In alignment with the Company's Remuneration Policy, severance
payment of 12 months' remuneration offered to Mr. Derdemezis as a way for the Group to express its appreciation for the loyalty, hard work and flexibility during the
last 23 years.
1
Includes benefits and allowances (such as travel, housing, international assignment related allowance), life insurance, medical plan, company car.
2
Cash payment.
3
Defined contribution.
8.8 Remuneration of the Executive Directors and the members of the Management Committee in 2021
8.7 Remuneration of Executive Directors and members of
the Management Committee in 2021
The remuneration of the Executive Directors and the members
of the Management Committee was approved by the Board
of Directors following relevant recommendation of the
Remuneration Committee and is in full compliance with the
2020 Remuneration Policy and thus contributes to the long-term
performance of the company as set above in § 8.3.
Given that the Company was established in 2019, the data
referring to the annual change in remuneration, expressed in full
time equivalents, of the Company’s employees other than the
directors, the members of the management committee and other
executives and the persons in charge of the daily management,
are presented jointly with respect to FY2019.
The annual change in the average remuneration (excluding board
fees and long term incentive), expressed in full time equivalents,
of the company’s employees other than the Directors, the
members of the Management Committee, the other directors
and the persons in charge for the daily management for 2021
is 4%. The ratio between the highest remuneration of the
management members and the lowest remuneration (in full time
equivalent) of the Company’s employees is 40 times.
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Name
Specification
of plan
1
Grant Date
Vesting Date
of 2021 Grant
Expiry Date
2
Number of
Stock grants
in 2021
Number of
units Fund
3
2021 grant
Options
forfeited in
2021
Options
Vested in 2021
(granted in
2019)
Exercise Price
Options
Exercised in
2021
Michael Colakides,
Managing Director*
LTI April 2021 31/3/2025 N/A - 42,860 - 6,176 €10 12,658
DCP April 2021 31/3/2024 N/A 5,910 - - - - -
Dimitri Papalexopoulos,
Chairman, Group Executive
Committee
LTI April 2021
50% on 31/3/2024
50% on 31/3/2025
N/A 30,450 - - 20,833 - -
DCP April 2021 31/3/2024 N/A 7,620 - - - -
Alexandra Papalexopoulou,
Deputy Chair, Group Executive
Committee
LTI April 2021
50% on 31/3/2024
50% on 31/3/2025
N/A 23,630 - - 13,506 - -
DCP April 2021 31/3/2024 N/A 5,910 - - - - -
Leonidas Canellopoulos,
Board Executive Director
LTI April 2021
50% on 31/3/2024
50% on 31/3/2025
N/A 4,730 - - 1,391 €10 379
DCP April 2021 31/3/2024 N/A 1,190 - - - - -
Yanni Paniaras,
Board Executive Director**
LTI April 2021
50% on 31/3/2024
50% on 31/3/2025
N/A 18,900 - - 7,331 - -
DCP April 2021 31/3/2024 N/A 4,730 - - - -
Bill Zarkalis,
Board Executive Director
LTI April 2021
50% on 31/3/2024
50% on 31/3/2025
N/A 30,450 - - 14,276 €10 23,206
DCP April 2021 31/3/2024 N/A 7,620 - - - - -
Grigoris Dikaios,
Management Committee
member*
LTI April 2021 LTI: 31/3/2025 N/A - 4,170 - 1,083 €10 2,003
Christos Panagopoulos,
Management Committee
member*
LTI April 2021 LTI: 31/3/2025 N/A - 15,240 - 3,861 €10 4,878
DCP April 2021 DCP: 31/3/2024 N/A 2,100 - - - - -
1
Long Term Incentive Plan (LTI), Deferred Compensation Plan (DCP).
2
2021 Grant refers to Stock (or Fund units) Grant and therefore expiry date i s not applicable.
3
Fund invests in TCI shares.
* Management Committee members' 2021 LTI award received as units of Fund which invest mainly in TCI shares.
** Yanni Paniaras is Board Executive Director since May 2021. Options vested in 2021 granted prior to Mr. Paniaras' appointment as Board Executive Director
8.9 Share-based Remuneration (for 2021)
8.10 2021 performance criteria and outcomes | Short-Term
Incentives
Following relevant recommendation by the Remuneration
Committee, the Board determines the most relevant performance
criteria for the short-term incentive plan. These KPIs provide
the framework for incentive schemes throughout the company.
Additionally, the Board sets challenging, but realistic target levels
for each of those performance criteria.
The Covid challenges were still very much the cause of significant
uncertainties at the beginning of 2021. The Group maintained
the view that the trend of market fundamentals was positive
and within this context set the emphasis of performance criteria
primarily on Group, regional and country profitability targets.
These performance criteria are a key incentive for leading the
company to successfully surpass the Covid period’s uncertainty
and to be better positioned to pursue its longer term strategy
thereafter.
The final assessment is determined at the end of the fiscal year,
based on the audited financial results. Any potential payout
under the short-term incentive plan occurs annually during the
first semester of the next financial year. A minimum level of
performance must be achieved before any payment under the plan
will be made. Payout is capped for stretch performance. The final
assessment of performance under the short-term incentive plan
is done by the Remuneration Committee, which in turn make the
necessary proposal to the Board for decision making.
Despite very sharp cost increases in critical cost elements (such as
fuel, electricity and shipping freight) in the last four months of the
year, the overall profitability of The Group was sustained at levels
not far below the original targets. In 2021, at Group level, EBITDA
was below the target resulting in a 88.0% payout in the respective
part of variable pay and Group ROACE was also below target
resulting in a 79.6% payout in the respective part of variable pay.
Furthermore, in 2021, at Group level, a strong performance
achieved against the set target linked to safety (the Lost Time
Injuries Frequency Rate index (LTIFR) was lower than the target),
resulting in a 120.9% payout in the respective part of variable pay.
The remuneration committee considered the overall performance
and concluded to award the variable pay for 2021 according to the
achieved results.
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8.11 2021 performance criteria and outcomes | Long-Term
Incentives
As already mentioned, two Restricted Stock Option plans (the RSIP
2014 and the RSIP 2017) are currently under implementation:
The 2014 Stock Options Plan (approved by the AGM of Titan
Cement Company SA of 2014)
According to this three- year Plan, the Board of Directors was
entitled to grant up to 1,000,000 stock options at a sale price
equal to €10.00 per share. Beneficiaries of the 2014 Stock Option
Plan are executive directors, directors holding senior positions at
Group or Regional or Country level in companies of TITAN Group,
and a limited number of employees, standing out on a continuous
basis for their good performance, having a high potential for
advancement.
The vesting period of the stock options granted in 2014, 2015 and
2016 was three years. As a result, the granted options matured in
December 2016, December 2017 and December 2018 respectively,
provided that the beneficiaries were still employees of the Group.
After the completion of the three-year vesting period, the Board
of Directors, based on the following criteria, decided the final
number of options that the beneficiaries had the right to exercise:
a. by 50%, based on the average 3-year Return on Average Capital
Employed (ROACE) compared to the target of each 3-year period
and;
b. by 50%, based on the overall performance of the Company's
TSR compared to the average overall performance of a predefined
international cement peer group:
1. Lafarge-Holcim 5. CRH
2. Heidelberg 6. Buzzi
3. Cemex (in US$) 7. Argos (in US$)
4. Cementir 8. Vicat
Based on the achievement against the above performance criteria,
the percentage (%) vested of the options granted in 2014, 2015 and
2016 was: 49% options vested out of the total granted options in
2014, 46% options vested out of the total options granted in 2015
and 81.3% options vested out the total options granted in 2016.
The Plan’s beneficiaries are entitled to exercise their stock option
rights, either in whole or in part, within the first five working days
of each month, paying the Company the relevant amounts until
the expiration date of their stock options i.e. until December of
the third year after vesting of the stock options. Based on the
Board of Directors decision dated April 9, 2020 due to covid-19
market conditions, it has been approved for the expiration date for
the grant of 2014 to be extended for one year to December 2021
and for the grant of 2015 to December 2022.
The 2017 Stock Options Plan (approved by the AGM of TITAN
Cement Company SA of 2017)
According to this three-year Plan, the Board of Directors is entitled
to grant up to 1,000,000 stock options at a sale price equal to
€10.00 per share. Beneficiaries of this Plan are the executive
directors, directors holding senior positions at Group or Regional
or Country level in companies of TITAN Group, and a limited
number of employees, standing out on a continuous basis for their
good performance, having a high potential for advancement.
The vesting period of the stock options granted in 2017, 2018
and 2019 is three years. As a result, the granted stock options
mature in December 2019, December 2020 and December 2021
respectively, provided that the beneficiaries were still employees
of the Group. After the completion of the three-year vesting
period, the final option rights number which the beneficiaries
will be entitled to exercise, shall be determined by the Board of
Directors, within the first four months of 2020 (done), 2021 (done)
and 2022 respectively and shall depend:
a. by 50%, based on the average 3-year Return on Average Capital
Employed (ROACE) compared to the target of each 3-year period;
and
b. by 50%, based on the overall performance of the Company's
TSR compared to the average overall performance of a predefined
international cement producing companies peer group:
1. Lafarge-Holcim 5. CRH
2. Heidelberg 6. Buzzi
3. Cemex (in US$) 7. Argos (in US$)
4. Cementir 8. Vicat
Based on the achievement against the above performance criteria,
the percentage (%) vested of the options granted in 2017, 2018 and
2019 was: 49.8% options vested out of the total number of options
granted in 2017, 35.88% options vested out of the total number of
options granted in 2018 and 31.83% options vested out the total
number of options granted in 2019.
The Plan’s beneficiaries are entitled to exercise their stock option
rights, either in whole or in part, within the first five working days
of each month paying the Company the relevant amounts until the
expiration date of their stock options, i.e. until December of the
third year after these stock options have been vested.
8.12 Executive Directors’ contracts
The employment contracts of the Managing Director of the
Company as well as of the other Executive Directors and the
members of the Management Committee are contracts of
indefinite duration.
In case of termination of the employment contract of the
Managing Director, the Executive Directors and the members of
the Management Committee, at the initiative of the Company,
severance payment, as provided in the 2020 Remuneration Policy,
cannot exceed 18 months’ remuneration.
For the payment of additional compensation in case of retirement
or early termination of employment, Board approval is required
following respective recommendation of the Remuneration
Committee.
Notice periods are according to statutory law provisions.
9. Information to be disclosed pursuant to Article 34 of the
Royal Decree of 14 November 2007
In accordance with Article 34 of the Belgian Royal Decree of 14
November 2007, the Company hereby discloses the following:
9.1 Capital Structure – Transfer of Company Shares
As referred above, in Section 2.1, on 31 December 2021, the
Company’s share capital amounted to €1,159,347,807.86
represented by 78,325,475 shares, without nominal value, with
voting rights, each representing an equal share of the capital.
The shares of the Company are of the same class and are either
71
in registered or in dematerialized form. Holders of shares may
elect to have, at any time, their registered shares converted to
dematerialized shares, and vice versa.
The Company’s Articles of Association do not contain any
restriction on the transfer of the Company’s shares.
9.2 Restrictions on voting rights
Each Share of the Company corresponds to one vote at the
Shareholder’s Meeting.
Article 13 of the Company’s Articles of Association provides that in
the event shares are held by more than one owner, are pledged, or
if the rights attached to the shares are subject to joint ownership,
usufruct or any other kind of split-up of such rights, the Board of
Directors may suspend the exercise of such voting rights until a
sole representative of the relevant shares is appointed.
9.3 Shares conferring special control rights
None of the Company shares carries any special rights of control.
9.4 Agreements between Shareholders of the Company,
which are known to the Company and contain restrictions
on the transfer of shares or on the exercise of voting rights
The Company, following the transparency notification received
on 24 June 2021 and changes in shares that did not require a
transparency declaration, due to the fact the 5% threshold was
not exceeded either upwards or downwards, has been informed
that the following shareholders, E.D.Y.V.E.M. Public Company
Ltd, Andreas Canellopoulos, Leonidas Canellopoulos, Nellos-
Panagiotis Canellopoulos, Pavlos Canellopoulos, Takis-Panagiotis
Canellopoulos, Trust Neptune, Alexandra Papalexopoulou, Dimitri
Papalexopoulos, Eleni Papalexopoulou, Alpha Trust, Delta Trust and
Lamda Trust, holding in total 30,641,972 shares, which correspond to
39.12% of the Company’s voting rights, are acting in concert.
9.5 Control mechanism of any employee scheme where the
control rights are not exercised by the employees
There is no employee scheme with such a mechanism.
9.6 Amendment of the Company’s Articles of Association
Any amendment of the Company’s Articles of Association must
be approved by the Extraordinary Shareholders’ Meeting and at
least 50% of the share capital must be present or represented. If
such quorum is not met at the first Extraordinary Shareholders’
Meeting, a new Shareholders’ Meeting may be convened and
shall validly deliberate and resolve irrespective of the share
capital present or represented.
An amendment of the Company’s Articles of Association is
adopted if it has obtained three-quarters of the votes cast,
whereby abstentions are not taken into account either in the
numerator or in the denominator.
9.7 Rules governing the appointment and replacement of
Board Members
Pursuant to Article 17 of the Company’s Articles of Association, the
Company is managed by a Board of Directors that shall consist of
a minimum of three and a maximum of fifteen directors, who shall
be natural persons or legal entities, whether or not shareholders,
appointed by the Shareholders’ Meeting.
The directors are appointed for a maximum term of three years
and may be reappointed. Their mandate may be revoked at any
time by the Shareholders’ Meeting.
When a legal entity is appointed as director, it must specifically
appoint an individual as its permanent representative to carry out
the office of director in the name and on behalf of the legal entity.
The appointment and termination of the office of the permanent
representative is governed by the same disclosure rules as if the
permanent representative was exercising the office on his/her
own behalf.
Should any of the director’s mandates become vacant, for
whatever reason, the remaining directors may temporarily
fill such a vacancy. The next Shareholders’ Meeting must
confirm the mandate of the co-opted director; in case of
confirmation, the co-opted director finishes the mandate of his
or her predecessor, unless the Shareholders’ Meeting decides
otherwise. If there is no confirmation, the mandate of the
co-opted director expires immediately after the Shareholders’
Meeting, without prejudice to the validity of the composition of
the Board of Directors until that date.
As long as the Shareholders’ Meeting or the Board of Directors, for
whatever reason, does not fill such vacancy, the directors whose
mandate has expired remain in function if the Board of Directors
would otherwise no longer consist of the minimum number of
directors required by law or the Company’s Articles of Association.
9.8 Powers of the Board of Directors
The Board of Directors is vested with the power to perform all acts
that are necessary or useful for the realization of the Company’s
purpose, except for those which the law or the Company’s Articles
of Association reserve to another corporate body.
The powers of the Board of Directors are further detailed in
the Company’s Articles of Association and in the Company’s
CG Charter, which are both available on the Company’s
website (https://www.titan-cement.com/about-us/corporate-
governance/).
9.9 Power of the Board of Directors to issue and buy-back
shares
9.9.1 The Board of Directors, pursuant to article 6 of the
Company’s Articles of Associations and the relevant resolution
of the Shareholders’ Meeting of 13 May 2019, may increase
the share capital of the Company in one or several times by a
(cumulated) amount of maximum €1,106,211,679.40. The Board
of Directors can exercise this power for a period of five (5) years
as from the date of publication of the Annexes to the Belgian
Official Gazette of the completion of the condition precedent
of the amendment to the Company’s Articles of Association
approved by the Extraordinary Shareholders’ Meeting of 13 May
2019. This authorization may be renewed in accordance with the
relevant legal provisions.
9.9.2 Pursuant to Article 15 of the Company’s Articles of
Association, the Company may, without any prior authorization
of the Shareholders’ Meeting, in accordance with articles 7:215ff
of the BCCA and within the limits set out in these provisions,
acquire, on or outside a regulated market, its own shares, which
correspond to maximum 20% of the issued shares, for a price
which will respect the legal requirements, but which will in
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TITAN CEMENT GROUP
72
any case not be more than 20% below the lowest closing price
in the last thirty trading days preceding the transaction and
not more than 20% above the highest closing price in the last
thirty trading days preceding the transaction. This authorization
is valid for five years from the date of the publication of the
completion of the condition precedent of the amendment to the
Company's Articles of Association approved by the Extraordinary
Shareholders' Meeting of 13 May 2019.
This authorization covers the acquisition on or outside a
regulated market by a direct subsidiary within the meaning and
the limits set out in article 7:221ff of the BCCA. If the acquisition
is made by a direct subsidiary, the dividends attached to the
shares held by the subsidiary go to the subsidiary.
Pursuant to article 15 of the Company's Articles of Association,
the Board of Directors is authorized, subject to compliance
with the provisions of the BCCA, to acquire for the Company's
account the Company's own shares, if such acquisition is
necessary to avoid serious and imminent harm to the Company.
Such authorization is valid for three years as from the date of
publication in the Annexes to the Belgian Official Gazette of the
completion of the condition precedent of the amendment of the
Company's Articles of Association, approved by the Extraordinary
Shareholders’ Meeting of 13 May 2019.
The Board of Directors is authorized to divest itself of part of or
all the company’s shares at any time and at a price it determines,
on or outside the stock market or in the framework of its
remuneration policy to personnel or directors of the company or
to prevent any serious and imminent harm to the Company. The
authorization covers the divestment of the Company's shares
by a direct subsidiary within the meaning of the BCCA. The
authorization is valid without any time restriction, irrespective of
whether the divestment is to prevent any serious and imminent
harm for the Company or not.
9.10 Important agreements which come into effect, are
amended or terminated in the event of change of control
of the Company, following a public tender offer
The Company has not entered into agreements, which come into
effect, are amended or terminated in the event of a change of
control of the Company, solely following a public tender offer.
It should be noted, though, that the Company has entered
into, as it is common, in agreements with a “change of control”
clause, specifying the right of the lending bank to request the
early repayment of the loan or the exit of the counterparty from
a company of the Group, in the event of a change of control
in the Company. In particular, such a clause is included in a
Multicurrency Revolving Facility Agreement of €208 million,
which has been entered into among the Group’s subsidiary
TITAN Global Finance PLC and a syndicate of lending banks with
the Company and TITAN Cement Company S.A. as Guarantors.
9.11 Agreements between the Company and the Board
Members or employees providing for compensation if the
Board Members resign or are made redundant without
valid reason or if the employment of the employees ceases
because of a takeover bid
The Company has not entered into any agreement with
members of the Board of Directors or employees providing for
the payment of compensation upon their resignation or dismissal
without valid grounds or upon termination of their tenure or
employment, due to a public tender offer.
10. Shareholder Information and Services
The Board as a whole is responsible for ensuring a satisfactory and
effective dialogue with shareholders. The Investor Relations team,
together with the Managing Director, the CFO and other Group
executives, regularly meet with institutional investors and participate
in investor roadshows and industry conferences. The announcements
of the annual and the interim Group results are accompanied by
webcasts and conference calls with analysts and investors.
All the regulatory and non-regulatory announcements, as well as
all other information related to the Company, are available on the
Company’s website (www.titan-cement.com).
10.1 Investor Relations Department
The Investor Relations Department is responsible for monitoring
Company relations with its shareholders and investors, and for
communicating with the investor community on an equal footing,
in a transparent and timely manner concerning the Company’s
performance. The aim is to generate long-term relationships with
the investment community and retain the high level of trust that
investors have in the Group.
Investor Relations: ir@titan-cement.com
Investor Relations Director: Afroditi Sylla,
e-mail: syllaa@titancement.com
10.2 Shareholder Services Department
The Shareholder Services Department is responsible for providing
timely information to shareholders and for facilitating their
participation in General Meetings and the exercise of their
rights as shareholders. The Department is also responding to
correspondence from shareholders on a wide range of issues.
Shareholder Services Manager: Nitsa Kalesi, e-mail: kalesin@titan.gr
10.3 Share Facts
10.3.1 Share Basic Data
Sector 5010 – Construction & Materials
Subsector 50101030 – Cement
Type Common share
Stock Exchange Euronext (Brussels and Paris), Athens Exchange
Number of shares 78,325,475
ISIN BE0974338700
CFI code ESVUFN
10.3.2 Tickers
Oasis Reuters Bloomberg
Euronext TITC TITC.BR TITC.BB
ATHEX TITC TITC.PA TITC.GA
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TITAN CEMENT GROUP
Risk management
TITAN Group is active in a diverse geographical, business and
operational landscape, resulting in a multitude of potential risk
exposures, including strategic, sustainability (ESG), operational
and financial risks.
In order to effectively identify and mitigate such exposures,
the Group manages its risks in accordance with established
international practices for industrial companies, embedding
key dimensions of Enterprise Risk Management (ERM) into its
processes, systems, and governance. In particular, the following
five main components of the ERM framework are supported
by a set of principles, providing the basis for the Group’s
understanding and management of risks associated with its
strategy and business objectives:
a. Governance and values, including oversight model, operating
structures, definition of desired cultural traits, commitment to
core values and development of appropriate talent;
b. Strategy and objective-setting, including definition of
risk appetite, analysis of context, evaluation of options, and
formulation of strategic objectives;
c. Performance, including risk identification, assessment, and
prioritization, implementation of responses, and development of
risk portfolio view;
d. Review and revision, including reviews of risk and
performance, assessment of changes, and continuous
improvement of approach;
e. Information, communication of risk information, use of IT and
reporting of risk performance.
Risk Management process
TITAN's Risk Management approach includes management
practices to actively address risk, helping to safeguard the long-
term sustainability of its business. It comprises a management
system including strategy-setting, organization, governance,
policies, reporting, communications with stakeholders, and
measurement of performance across all units of the Group.
The Board has overall responsibility for determining the nature
and extent of the principal risks that the Group is willing to
assume in achieving its strategic objectives. Risks are addressed
on a day-to-day basis by the Group’s management at various
levels in the organization according to the nature of each risk.
As a result, risks are identified and quantified using multiple
sources and are reported in the course of the planning and
performance management cycle of the Group, ensuring a quick
and effective response.
Complementing this risk management culture and approach
that is integral to the Group’s business processes and decision-
making (both strategic and operational), the Group undertakes
on a regular basis a systematic exercise to assess all material
risks faced by the Group that could affect the Company’s
business model, performance, solvency, or liquidity. These risks
are categorized as “strategic”, “operational”, “ESG” or “financial”.
A committee consisting of senior managers from the Group’s
Strategic Planning, Legal and Internal Audit, Risk and Compliance
departments periodically assesses the Group’s main risks along
the following three dimensions, in line with industry best
practices:
a. Probability: scale from 1 (Rare) to 5 (Almost certain)
b. Impact: scale from 1 (Incidental) to 5 (Extreme)
c. Preparedness: scale from 1 (Low) to 5 (High)
Risks are categorized using established risk taxonomies relevant
for the Group’s business (provided by consultants and external
risk experts). The risks are also assessed using a variety of
techniques, including the benchmarking of sector practices,
enriched with the advanced practices of other industries, the
qualitative and quantitative assessment of the risk elements, the
evaluation of possible outcomes against the Group’s strategic
objectives, the risk elaboration of the Group’s material issues,
the evaluation of risk ownership and the recording of mitigating
actions that are adopted or planned. The initial assessment
is iterated with input from key Group managers. The risks are
cross-referenced with the output of the Group’s materiality
assessment exercise and reviewed by the Group Executive
Committee. Finally, the Board validates the relevant risk
assessment and monitors TITAN’s risk management and internal
control systems, reviewing their effectiveness (covering all
material controls, including financial, operational, organizational,
and compliance controls). To that end, in October 2021 the board
held a meeting specifically dedicated to reviewing the Group’s
strategic directions and priorities against the key business risks
for the next three years (2022, 2023 and 2024).
In addition, in 2021 a specific assessment of the Group’s
climate change-related risks and opportunities took place. The
exercise covered physical risks like temperature, flooding and
water stress, as well as transition risks, like carbon pricing,
reputational damage and litigation. To this effect, TITAN’s
relevant Sustainability and Risk teams engaged with climate
risk experts to analyze risks stemming from climate change, as
well as opportunities arising from the transition to a low-carbon
economy, in alignment with the TCFD framework. The results
indicated that the Group’s climate-related risks are in line with
those of its sectoral peers.
Risk Management, governance and controls
In TITAN Group, Risk is managed at three levels, in line with
industry best practices.
Risks are managed on a day-to-day basis by the Group’s
management at various levels in the organization according
to the nature of each risk. TITAN’s risk governance framework
follows a customized approach that best addresses the
particularities of each risk area and ensures the optimum
degree of risk ownership and accountability for the appropriate
mitigation actions. Frontline management executes its risk
management role in accordance with policies and standards,
monitors and mitigates risks as part of performance
management, and identifies and escalates risks as required.
This first level of management includes the integration with key
business processes (e.g., capital expenditures reviews, strategic
planning, budgeting process, etc).
74
At a second level of risk governance and control, the central risk
team (i.e., the Internal Audit, Risk and Compliance unit) ensures
adherence to the ERM framework and internal policies and
monitors its systematic assessment by aggregating risk insight,
integrating input and analysis across the Group, and sharing
policies and recommendations across the organization.
At the senior level, the Board has the overall responsibility for
determining the nature and extent of the principal risks that the
Group is willing to assume in achieving its strategic objectives.
The Board, through all its Committees, discusses and assesses
on a regular basis the main areas of risk to which the Group is
exposed, identifies new risks, defines the risk appetite of the
Group and monitors the effectiveness of the risk management
and internal controls. The Board has delegated responsibility
for the monitoring of the effectiveness of the Group’s risk
management and internal control systems to the Audit and Risk
Committee. In parallel, the Group Executive Committee provides
strategic direction, an independent view of risks among all
operating units, and coordination among them as needed.
According to this framework, strategic and financial risks are
managed mainly by the Group Executive Committee, Group
Finance, and the Capex Committee. The management of most
operational and sustainability risks is to a large extent embedded
in the daily operation and processes of the local business units.
A number of risks, including legal and compliance risks,
as well as operational and sustainability risks, including
environmental risks, risks regarding energy and fuel prices,
availability and cost of raw materials, safety at work, labor
issues, brand and reputation, are managed both at Group level
by the Group Executive Committee and the competent Group
functions (Internal Audit, Risk and Compliance, Group Legal,
Group Procurement, Group Innovation and Technology, Group
Corporate Affairs, Group IT, Group Communication, Group HR)
and also at the local business unit level (BU Legal, Procurement,
Corporate Social Responsibility, HR units). This approach ensures
that line management owns all the operational and sustainability
risks that occur at the level of individual businesses and enables
a strong risk culture embedded in all relevant decision-making.
At the same time, all risks of higher magnitude that are relevant
at Group level are managed centrally, aggregating risk data
points from multiple sources across the organization, integrating
insights, and crafting mitigating action plans that can be shared
among all appropriate organizational levels.
The Group Executive Committee is also responsible for setting
Group policies and ensuring that they are implemented
throughout the Group. To this end, a set of policies provide
the necessary framework and reference point for a number
of risk areas. In parallel, the ethics and compliance programs
implemented throughout TITAN’s operations ensure that the
Group’s principles and values are integrated into the day-to-day
operations and the risk management culture is reinforced across
the Group.
The effectiveness of the systems and policies implemented
at Group and business unit level are systematically reviewed
by the Group Executive Committee and the business units’
management, including for compliance with relevant standards
of the Group. Whenever weaknesses are identified, corrective
measures are taken.
Group Internal Audit, Risk and Compliance reports on the
effectiveness of the risk management and internal control
frameworks to the Audit and Risk Committee on a regular basis.
The Board and the Audit and Risk Committee receive on a regular
basis management reports on the key risks to the business and
the steps taken to mitigate such risks and consider whether the
significant risks faced by the Group are being properly identified,
evaluated and managed.
TITAN’s principal risks
Strategic risks
• Climate change mitigation and adaptation
The cement industry is potentially sensitive to ever more
stringent carbon regulations. For example, the Group’s
operations in Greece and Bulgaria are required to comply
with an EU-wide cap and trade emissions scheme, namely
the European Trading Scheme (ETS), under which industrial
installations must report and control their CO₂ emissions on an
annual basis. This may result in additional capital expenditure
and reduced profitability due to increases in operating costs;
because of this, the Group may face increased competition
from cement producers operating outside the EU, which do not
incur ETS compliance costs. A mulled Carbon Border Adjustment
Mechanism (CBAM) to protect against “carbon leakage” is still
under design and may eventually prove ineffective. Beyond
operations in the EU, additional countries in TITAN's footprint
that do not face stringent carbon regulations today could in the
future adopt CO₂ pricing or other carbon regulations, resulting
in an uneven playing field if “carbon leakage” is not adequately
addressed (for example resulting in reduced competitiveness of
exports).
Moreover, the surging climate agenda may promote the use of
concrete substitutes for construction as less carbon intensive.
The Group closely monitors relevant regulatory developments
and takes proactive measures to mitigate potential negative
consequences. A scenario-modelling approach has been adopted
for the examination of possible outcomes (transitional risks) and
the identification of appropriate roadmaps of mitigating actions
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for the safeguarding of the Group’s business resilience. Such
measures include the reduction of the amount of clinker used in
the production of cement, the use of alternative fuels, energy
efficiency measures, the development of new products (including
low-carbon clinker), and continuous innovation across the value
chain. Indeed, the Group is engaging in research collaboration
with the scientific community on less carbon-intensive cements
and concretes (e.g. using cementitious materials and chemical
additives) to develop and promote the use of new “green”
concretes and create a level playing field versus other building
materials.
• Industry cyclicality
The building materials industry is dependent on the level of
activity in the construction sector, which tends to be cyclical
and dependent on various factors, including, but not limited
to, the level of infrastructure spending, the demand for private
and commercial real estate, mortgage lending, local economic
activity, inflation, and interest rates. The Group’s business,
operational results, or financial condition could be adversely
affected by a continued deterioration of the economic outlook or
cyclical weakness in the construction industry on a global scale
or in a significant market in which it operates.
• Market conditions
The Group operates both in developed markets, like the
USA and EU markets, as well as in emerging markets, such
as Egypt, Turkey and Brazil. Any future deterioration in the
global economic environment, or in any particular market, that
contributes significantly to the Group’s revenues and profitability
could have a material adverse effect on the construction sector,
and consequently, on the Group’s business, operational results
and financial condition.
• The concentration of a large proportion of the Group’s
business, operations, and assets in the United States
A large proportion of the Group’s business, operations, and
assets is concentrated in the United States, in particular in
Virginia, Florida, North and South Carolina, and New Jersey,
and the Group’s operational results are dependent on the
Group’s performance in the United States. Any decrease in
cement consumption, building activity, or public spending on
infrastructure in any of the US markets in which the Group
operates, or a combination of the above, or any adverse change
in logistics or freight costs, can have an adverse effect on the
Group’s operating performance, business and profitability.
• Political and economic uncertainty
The Group operates and may seek new opportunities in
emerging markets with differing and, at times, volatile economic,
social and political conditions. These conditions could include
political unrest, civil disturbance, currency devaluation, capital
controls and other forms of instability and may result in sudden
changes to the operating and regulatory environment. Changes
in these conditions may adversely affect the Group’s business,
operational results, financial performance and/or prospects.
The annual budgeting and strategic review process, along
with the regular monitoring of financial results and forecasts,
helps track political and economic events that may create
uncertainties regarding financial performance. Where political
tensions are heightened, mitigation measures are in place to
provide maximum protection of TITAN’s people and assets.
• Global systemic disruption including COVID-19 pandemic risk
Global-level disruptions can affect the Group’s operations in
diverse and largely unpredictable ways but have a common
thread: they would impact almost all our BUs/areas of operation
(vs. more localized impacts). Such events could have a multitude
of sources, for example:
– Climate, e.g. extreme weather events, environmental
disasters;
– Societal, e.g. pandemics causing loss of demand due to
economic downturn and loss of production due to health crisis
(including COVID-19), crises of essential resources (food, water);
– Large scale conflicts, e.g. interstate conflicts, trade wars
causing disruptions in supply chains;
– Global data infrastructure, e.g. nationwide cyberattacks, global
information and communication infrastructure compromises
disrupting global and/or regional financial and trade systems.
To anticipate and mitigate the effects of such globally relevant
macro disruptions, the Group is engaging in risk assessments,
scenario evaluation, and contingency planning at strategic,
operational, and people (health and safety) levels. In addition,
disaster-control protocols are continuously updated in order
to mitigate the effects of health and safety-related crises, and
financial resilience measures are taken so as to bolster the
Group’s balance sheet and insurance coverage. On a strategic
level, the Group’s geographical diversification can provide a
high degree of resilience against the effects of more regional
disruptions.
In 2021, similar to the previous year, a particular focus on the
potential risk assessment of COVID-19 (SARS-CoV-2) continued
to be placed, given the ongoing prevalence of the global
pandemic, focusing on the potential effects of the pandemic
in dimensions such as the health and wellbeing of personnel,
disruptions in production capacity of our assets, the drop of
demand for the Group’s products in particular markets and
supply chain disruptions affecting the local and international
flows of materials and people. All the measures that successfully
addressed the COVID-19 related risks since early 2020, such
as COVID-specific workplace health protocols and policies,
effective production and supply chain processes, safeguarding of
critical supplies, and dedicated reporting to enhance the ability
to detect potential impacts in our markets, were fully applied
throughout the year and adjusted where needed, following the
pandemic evolution in each area of the Group’s operations.
Financial risks
The Group, due to the nature of its business and its geographical
positioning, is exposed to financial risks associated with foreign
currency, interest rates, liquidity, and leverage, as well as
counterparties. Financial risks are managed by Group Finance
and Treasury.
The Group does not engage in speculative transactions or
transactions which are not related to its commercial and
business activities.
• Foreign currency risks
Group exposure in foreign currency derives from existing or
expected cash flows and from acquisitions and/or investments
denominated in currencies other than the euro. The Group’s net
foreign currency exposure mainly arises from USD, EGP, RSD,
LEK, GBP, BRL, and TRY.
76
Natural hedges (equity invested in long-term fixed assets and
borrowings in the same currency as the activities that are
being financed), currency swaps, and forward foreign currency
contracts are used to manage currency exposures.
• Interest rate risks
The Group’s exposure to interest rate changes and increased
borrowing costs are managed through employing a mix of fixed-
and floating-rate debt and interest rate derivatives, where
appropriate. The ratio of fixed to floating rates of the Group’s
borrowings is decided on the basis of market conditions, Group
strategy, and financing requirements.
As at 31 December 2021, the Group’s ratio of fixed to floating
interest rates stood at 88%/12% (31 December 2020: 93%/7%).
• Liquidity and leverage risks
In order to manage liquidity risks and to ensure the fulfilment
of its financial obligations, the Group maintains sufficient cash
and other liquid assets, as well as extensive committed credit
lines with several international banks, which complement its
operating cash flows.
The Group’s financial position allows it to have access to the
international financial markets and raise needed funds.
• Counterparty risks
Counterparty risk relating to financial institutions’ inability
to meet their obligations towards the Group deriving from
placements, investments, and derivatives, is mitigated by pre-
set limits on the degree of exposure to each individual financial
institution as well as by utilizing the collateral mechanism
of credit support agreements (ISDA CSA Agreement). As at 31
December 2021, the majority of Group liquidity was held with
investment-grade financial institutions with pre-agreed credit
support agreements.
The Group is also exposed to counterparty risks relating to
customer receivables. Customer receivables primarily derive
from a large, widespread customer base. The financial status
of customers is constantly monitored at the business unit
level and, where it is deemed necessary, additional security is
requested to cover credit exposure. As at 31 December 2021, all
outstanding doubtful receivables were adequately covered by
relevant provisions.
Environmental, Social and Governance (ESG) Risks
• Health and safety
Cement production and the operation of quarries and ready-mix
facilities have inherent safety risks which could be influenced by
factors outside the Group’s control. Ensuring health and safety
and preventing accidents at work is a top priority for TITAN.
Excellence in the area of health and safety is embedded in all
TITAN operations and activities. The Group has implemented
detailed policies and procedures promoting Health and Safety,
including the coverage by an adequate number of safety
engineers in all production units. Particular emphasis is placed
on training and raising safety awareness and on the strict
application of safety systems and processes.
TITAN’s Group Health and Safety Policy mandates assessment
of all incidents, proactive planning, the setting of specific
targets, safety training, and the monitoring of progress. Health
monitoring of employees is performed regularly.
In parallel with all the other preventive measures, TITAN’s
production and construction sites are regularly audited by the
Group’s safety specialists.
• Risks related to the environment
The Group’s operations are subject to extensive environmental
and safety laws and regulations in the USA, the EU, and
elsewhere, as interpreted by the relevant authorized agencies
and judicial authorities. These may impose increasingly stringent
obligations and restrictions regarding, among other things, land
use, remediation, air emissions, waste treatment, water use,
and occupational and community health and safety. The costs of
complying with these laws and regulations are likely to increase
over time.
The Group is in compliance with all environmental regulations
and conditions in all countries where it operates. With a view
to continuously managing the environmental impact of its
operations, TITAN applies in all its plants management systems
to monitor and report their environmental impact. The Group’s
Environment Policy and environmental management provide
targets for the reduction of air emissions, the protection
of biodiversity, water and waste management, and quarry
rehabilitation.
• Human Resources, Diversity and Inclusion
Cement companies, including ΤΙΤΑΝ face a multitude of potential
risks related to their human resources and talent management.
Existing processes to recruit, develop and retain talented
individuals and promote their mobility may not be sufficient,
thus potentially giving rise to risks of employee and management
attrition, difficulties in succession planning, and an inadequate
pipeline of future talent, potentially impeding the continued
realization of high operational performance and future growth.
Moreover, success in enforcing its Human Rights and Diversity
and Inclusion policies is increasingly crucial in determining how
the Group is perceived by key stakeholders, such as current
and prospective employees, consumers, and investors. Greater
diversity in the Group’s human capital increases the likelihood
of innovation that contributes to business growth, and higher
degrees of inclusion foster better employee engagement,
productivity, and company loyalty, resulting in higher talent
retention rates and overall employee engagement.
ΤΙΤΑΝ is actively pursuing a rich agenda of actions to develop its
talent management, including the updating and diffusion of its
relevant HR policies (such as its Human Rights and Diversity and
Inclusion policies) and people development processes.
Relevant measures pursued include employee surveys, focus
groups for feedback, training and capability-building programs,
adoption of Diversity and Inclusion global best practices,
provision of ubiquitous access to the TITAN Group reporting
platform EthicsPoint®, and the fostering of a continuous dialogue
on industrial relations with all relevant stakeholders.
• Regulatory compliance risk
The Group is subject to many local and international laws
and regulations, including those related to competition law,
corruption, and fraud, across many jurisdictions of operation
and is therefore exposed to changes to those laws and
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regulations and to the outcome of investigations conducted
by governmental, international or other regulatory authorities.
Potential breaches of local and international laws and regulations
in the areas of competition law, corruption, and fraud, among
others, could result in the imposition of significant fines and/
or sanctions for non-compliance, and may inflict reputational
damage.
Compliance risks are proactively addressed at Group level
through the TITAN Group Compliance Program, an integrated
system of relevant activities, mechanisms and controls, aiming
to provide adequate assurance that compliance risks are timely
identified, properly assessed and effectively mitigated. The
Compliance Program reinforces compliance culture, ensures
adherence to compliance requirements, and fosters ethical
behaviour. Moreover, all operations are continuously monitored
at local and Group level by the Group Legal and Group Internal
Audit, Risk and Compliance departments. Also, relevant reports
provided by experts and independent organizations such as
Transparency International, are taken in account.
The set of Code of Conduct and Group Policies, applicable to all
TITAN Group operations, cover all strategic areas and provide
guidelines to employees and external business collaborators
for compliance with the applicable internal and statutory rules.
Such Group Policies include but are not limited to Anti-Bribery
and Corruption, Conflict of Interest, Competition Law, Sanctions,
Corporate Social Responsibility, Whistleblowing, Environmental
and Climate mitigation, Protection of Personal Data, Human
Rights, Occupational Health and Safety. Regular training of
employees is conducted to ensure that the Group’s Code of
Conduct and relevant Group Policies are effectively adhered
to. All employees also have free and unrestricted access to the
Group Policies, which have been uploaded on the Group Intranet
and on our website (https://www.titan-cement.com/about-us/
corporate-governance/group-policies).
Operational Risks
• Production cost (including raw materials and energy)
Thermal and electrical energy and fuel costs, freight rates
or other transportation costs, and the cost of raw materials
constitute the most important elements of the Group’s cost
base. Increases or significant fluctuations in energy and fuel
costs, freight rates, or other transportation costs could adversely
affect the Group’s operational results, business, and financial
condition, especially if it is unable to pass along higher input
costs to its customers.
In 2021 the costs of energy (thermal and electrical) increased
significantly, especially in Europe, due to a variety of factors,
especially in the second half of the year. Freight rates, which are
responsible for a significant part of the Group's logistics cost,
also increased substantially. A specific review of the measures
available to the Group for mitigating such cost increases
was performed at regional level and at the Group Executive
Committee and an appropriate set of actions (including hedging
instruments) was put in place. In addition, in order to reduce
costs and also curtail its environmental footprint, the Group is
investing in low energy-requirement equipment and in energy
efficiency.
Ensuring access to the required quality and quantity of raw
materials at competitive cost is a constant priority. Care is taken
to secure the adequacy of the supply of raw materials during
the facilities’ entire lifetime. The Group is investing in the use
of alternative raw materials in order to gradually reduce its
dependence on natural raw materials.
• Risks arising from various risks of business interruption,
including as a result of natural disasters
Natural disasters such as earthquakes, hurricanes, storm surges,
flooding, wildfires may at any time disrupt our asset base and
production and/or distribution capacity, etc. There is also a
risk of an increase in the frequency of extreme natural events,
potentially as a result of climate change.
With regards to the mitigation of the effects of possible physical
impacts on the Group’s assets from extreme natural events, the
company is implementing a set of proactive protective measures
for its assets and developing continuously updated emergency
plans. With a view to protect its people and its operations, TITAN
also invests systematically in equipment and systems to prevent
or mitigate the effects or flooding, fire, hurricanes, etc. The
Group also ensures adequate insurance policies against physical
damage or temporary loss of business, as well as the ready
availability of sufficient liquidity to absorb any potential impacts.
• Cybersecurity Risks
Cyberattacks may compromise the Group’s IT (Information
Technology) and OT (Operations Technology) systems, data, and
operations. There is a variety of potential threat actors (from
opportunistic hackers to full-scale foreign government sponsored
shadow organizations), with a diverse level of motivation,
sophistication of attack systems, skills, and resources. Attacks
could range from incidental in a minor location or domain,
to a plant-specific event, company-wide attacks and even
attacks affecting the broader industry and its external partners
(suppliers, banks, customers).
Loss or corruption or leakage of data may be crucial for:
– sales, purchases, or financial transactions (incl. banking fraud)
– confidentiality and GDPR-related commitments
– operations (e.g., plant operational data used by control
systems)
Kosjeric cement plant, Serbia
78
IT systems’ breakdown or corruption could require lengthy
remediation action, while OT systems breakdown or corruption
could cause operational disruption in our plants and loss of
production.
The Group is taking a variety of measures to address such
risks, including the analytical understanding of such threats
and the creation of detailed mitigation plans, the development
of cybersecurity policies and procedures (including the Group
Information Security Policy), the increase of underlying security
of critical IT and OT assets, the development of operational
recovery plans, and the implementation of monitoring and
reporting protocols on identified potential risks.
• Supply Chain Disruption
The integrity and profitability of the Group’s production and
customer-facing operations depend on its ability to safeguard
critical resources for the uninterrupted manufacturing and
delivery of its products. Scarcity of natural resources, such as
water and aggregates reserves, could have a materially adverse
effect on the Group’s costs and operational results.
Additionally, should existing suppliers cease operations or
reduce their production of key materials and production inputs,
sourcing costs for the Group could increase significantly or
necessitate the search for alternatives.
To mitigate such risks, the Group constantly evaluates its supply
chain resilience, develops strategic options for the provision
of its most critical supplies, stocks critical spare parts which
in case of failure may result in long stoppages and seeks to
secure production inputs through short and long-term contracts
to ensure the necessary quantity, quality, and availability of
required products. It also strives to secure long-term raw
material reserves for its most critical production inputs. Such
measures to create sourcing resilience were reviewed in detail
during 2021, given the ongoing global supply chain disruptions.
Finally, by deploying a scenario-logic in its planning processes,
the Group is proactively developing flexible and resilient sourcing
strategies to withstand possible variability in the supply markets.
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Rehabilitated quarry, USA
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esg
performance
review
An overview of our performance on the environmental,
social and governance pillars.
82
As presented in pages 20-21, TITAN has set ambitious
Environmental, Social and Governance (ESG) targets for
2025 and beyond, underscoring its enduring commitment to
sustainability and value creation for all. They focus on four
pillars: Decarbonization and digitalization, growth-enabling work
environment, positive local impact, and responsible sourcing,
all underpinned by good governance, transparency and business
ethics.
In the ESG performance review section of the Management
report, we provide a detailed overview of our annual performance
and progress towards meeting our ESG targets. For each of the
issues that have been identified as material for TITAN and its
stakeholders, we present the foundations that we have built on
and describe our management approach to addressing them,
highlighting important achievements recorded throughout the
year (e.g. new policies, initiatives, programs and investments).
Focus area: Decarbonization and digitalization
Material issue: Future-ready business model in a carbon-
neutral world
TITAN is committed to the COP21 Paris Agreement goal of
keeping the increase in global average temperature to well below
2°C, and preferably to 1.5°C above pre-industrial levels, and to
the UN Sustainable Development Goals 2030. The Group also
supports the European Green Deal vision of carbon neutrality by
2050 and endorses the Global Cement and Concrete Association
(GCCA) 2050 Climate Ambition, the cement industry’s joint
effort towards carbon neutrality. Furthermore, TITAN Group
has signed the “Business Ambition for 1.5°C” Commitment,
a global campaign led by the Science Based Targets initiative
(SBTi), joining a number of leading companies worldwide that are
committed to keeping global warming to 1.5°C and reaching net-
zero emissions by 2050.
In 2021, the GCCA launched “Concrete Future”, the industry
roadmap to net-zero concrete that will guide all GCCA members
through their decarbonization process, a journey that has already
started at TITAN with ambitious, science-based targets and
concrete actions across all our regions and operations.
The Group aspires to reduce its carbon emissions by increasing
the use of alternative fuels, accelerating its efforts in energy
efficiency, developing low-carbon products, and adopting
innovative technologies and solutions. Through the participation
in European and international consortia, as well as through
collaborations in R&D projects, TITAN will continue to develop
low-carbon cementitious products and pilot carbon-capture and
utilization technologies in its plants, actively contributing to the
industry’s ambition for a carbon-neutral future.
Validation of TITAN’s CO₂ emissions reduction targets by the
Science Based Targets initiative (SBTi)
TITAN Group was among the first cement companies worldwide to
have its CO₂ emissions reduction targets validated by the Science
Based Targets initiative (SBTi). Using the guidance and resources
provided by SBTi, we developed the reduction targets in line
with SBTi rules and submitted them for validation in mid-2021.
Following a thorough procedure, the targets, covering greenhouse
gas emissions from TITAN’s operations (Scopes 1 and 2), were
validated as consistent with reductions required to keep global
warming to well below 2°C, in accordance with the goals of the
Paris Agreement. The Group is aiming to:
• Reduce Scope 1 GHG (gross) emissions by 20.7% per tonne
of cementitious product by 2030 from a 2020 base year. This
target is in alignment with the 35% CO₂ reduction target on net
emissions by 2030 from a 1990 base year, announced by TITAN in
March 2021.
• Reduce Scope 2 GHG emissions by 42.4% per tonne of
cementitious product within the same timeframe. This target is
in alignment with the 45% reduction target by 2030 from a 2020
base year, announced by TITAN in March 2021.
Note: The target boundary includes biogenic emissions and
removals associated with the use of bioenergy.
The SBTi is a partnership between the Carbon Disclosure Project
(CDP), the United Nations Global Compact, the World Resources
Institute (WRI) and the World Wide Fund for Nature (WWF).
It independently assesses and validates corporate emissions
reduction targets against the latest climate science.
In addition, TITAN has committed to drive down the CO₂
footprint of its operations and products, aspiring to deliver
society with carbon-neutral concrete by 2050, while monitoring
and independently verifying its supply chain (Scope 3) emissions.
TITAN’s Scope 1 CO₂ emissions performance
In 2021, the Group improved further its net Scope 1 specific
emissions by almost 20kgCO₂ per tonne of cementitious
product to 654.2kgCO₂ per tonne of cementitious product, or
else a 16.0% reduction compared to 1990 levels. The Group
remains determined to address the climate change challenge
and has committed to achieve a level of 500kg CO₂ per tonne of
cementitious product by 2030 and a reduction of 35.0% since
1990.
Alternative fuels (Co-processing)
The increased use of lower-carbon fuels that replace non-
renewable fossil fuels is a key lever towards achieving TITAN’s
decarbonization targets. Co-processing contributes to the
conservation of natural resources, the reduction of CO₂ emissions,
and the cement industry's long-term competitiveness while it also
provides a low-cost circular-economy solution to society.
The Group’s alternative fuel thermal substitution rate reached
15.5% in 2021, an increase of ca. 19.0% since last year. Biomass
use also increased, reaching a thermal substitution rate of 4.8%.
Dried sewage sludge, refinery sludge, tires, solid recovered fuel/
refuse derived fuel (SRF/RDF) and agricultural waste were used
to substitute conventional solid fuels in several of the Group’s
plants in 2021. The increase in the use of alternative fuels has
been the result of (a) successful permitting, (b) continuous and
rigorous sourcing efforts for new alternative fuels in the local
and international markets, and (c) investments across several
TITAN cement plants in alternative fuel processing facilities and
the plants’ feeding, storage and combustion infrastructure of
ca. €20 million.
ESG performance overview
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More specifically, a new state-of-the-art production facility
for alternative fuels went into operation in Pennsuco cement
plant, Florida, during the first quarter of 2021, thus introducing
high-quality RDF as a new fuel type for co-processing in the
kiln. New installations or upgrades to the existing infrastructure
for the production of alternative fuels were also completed in
the cement plants of Zlatna Panega plant, Bulgaria, and Usje,
North Macedonia, allowing both plants to reach record thermal-
substitution levels and contributing to local waste-management
efforts. The feeding installation of the Thessaloniki plant,
Greece, was also upgraded, resulting in significant improvements
in the plant’s consumption of alternative fuels.
TITAN continues to pursue opportunities to increase and
optimize the use of low-carbon fuels in the cement-production
process, with a steadfast commitment to reducing the
environmental footprint of the Group’s plants. One of the key
investments towards this goal is a new €25 million pre-calciner
unit in Kamari plant, in Greece. Its installation started in 2021
and it is expected to be in full operation in 2023. Additional
investments of ca. €14 million were approved during 2021,
which will further improve the storage, handling and feeding
infrastructure of Zlatna plant in Bulgaria, Beni Suef plant in Egypt
and Thessaloniki plant in Greece.
Fully aligned with its sustainability ambitions and commitment
to the circular economy, TITAN is also diversifying into the waste
management sector. A notable example is the participation in
the public tenders (PPPs) for mechanical and biological waste
treatment (MBT) plants in Greece, in a joint venture with TERNA
Energy. MBT plants can maximize recycling, minimize landfilling
and secure the availability of alternative fuels, providing a
solution to the critical environmental issue of municipal solid
waste (MSW).
Low carbon products
The Group further reduced the carbon footprint of its products
by shifting to lower-carbon cements in the USA, Greece, Egypt
and North Macedonia. In 2021, we made further progress in the
reduction of our clinker-to-cement ratio, achieving a decrease of
0.7 percentage points (81.7% vs. 82.4% in 2020).
Meanwhile, since September, approximately half of Titan
America’s cement output consists of the lower-carbon Type
IL cement. Its Pennsuco plant in Florida is now the largest US
producer of Type IL cement, which has approximately 15% lower
carbon emissions than Type I or Type II cement. In Greece, the
Kamari plant further expanded its export product portfolio,
including the less carbon-intensive Type IL, in response to US
market needs for sustainable construction.
Moreover, the Group’s plants in Greece – Kamari, Thessaloniki
and Patras – started to produce a new Portland-composite
cement (CEM II/B-M (P-LL) 42.5N) with an improved carbon
footprint to cover both the domestic market and exports to
other European countries. The Alexandria and Beni Suef plants
in Egypt introduced a Portland-pozzolanic cement (CEM II/A-P
42.5N), with lower embodied CO₂ than the local industry
benchmark of Ordinary Portland Cement (OPC). The Usje plant
in North Macedonia, in line with its commitment for continuous
improvement in the field of environmental protection and
sustainable development by reducing waste, introduced two new
pozzolanic cements (CEM IV/B (V-P) 32.5N and CEM IV/B (V-P)
42.5N), which have a lower clinker content and use more high-
quality fly ash and natural pozzolana.
Thermal energy efficiency
Energy efficiency, the conscious use of raw materials and fossil
fuels and their replacement with alternative ones, and the
implementation of efficient waste management systems are
proven means of adding value throughout the value chain as well
as providing waste management solutions at a local level.
TITAN Group thoroughly monitors energy consumption and
efficiency in order to reduce its environmental footprint and
curtail costs. As energy management and resource efficiency are
closely connected to the sector’s decarbonization roadmap, the
Group is investing in low energy demand equipment to improve
energy efficiency.
In a similar way, the frequent inspections of equipment and timely
maintenance by plant teams, and the replacement or installation
of new energy-efficient equipment (e.g., grate coolers and 5-stage
preheaters with a pre-calciner and new burners), as well as careful
selection of fuels, use of mineralizers and process optimization,
helped sustain the Group’s strong performance in thermal energy
consumption.
In 2021, specific heat consumption (SHC) remained at almost the
same level as in 2020.
Climate change mitigation indicators 2021 2020
Group level (cement operations)
Specific net Scope 1 CO₂ emissions
(kgCO₂/t cementitious product)
654.2 674.0
Alternative fuel thermal substitution rate (%) 15.5 13.1
Clinker-to-cement ratio (%) 81.7 82.4
Specific heat consumption (kcal/kg clinker) 839.5 834.9
Scope 2 CO₂ emissions performance
Regarding Scope 2 CO₂ emissions, TITAN Group is exploring
the different options available to realize this target. Sourcing
renewable energy from current or potential suppliers, installing
renewable energy facilities like wind or solar farms at or near our
plants and quarries or maximizing thermal energy retrieval using
waste heat recovery systems are options that TITAN Group is
considering as possible solutions.
In 2021, Scope 2 specific emissions were reduced by 15.6%, bringing
them to 51.5kg CO₂ per tonne of cementitious product. As part
of our overall commitment to transparency, an external auditor
verified our Scope 2 emissions.
In recent years, we achieved a reduction in electrical consumption
through the installation of advanced equipment, like low-energy
vertical roller mills, roller presses and dynamic separators, or
motors with inverters as well as the replacement of electrostatic
precipitators with the lower energy-consuming bag filters. In 2021,
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the Zlatna Panega plant in Bulgaria finalized and commissioned
the upgraded raw meal silo and raw meal transportation
system, which resulted in a 10% reduction in electrical energy
consumption for clinker production.
In 2021, specific electrical energy consumption slightly increased,
reaching 115.0kWh per tonne of cement compared to 113.0kWh
per tonne of cement in 2020.
Scope 3 CO₂ emissions performance
Monitoring our supply chain (Scope 3) CO₂ emissions is critical
to achieving TITAN’s long-term ambition for carbon-neutral
concrete by 2050. In mid-2021, after two pilot tests in Greece and
Serbia, the Group ran a full-scale exercise covering 13 integrated
and 2 grinding cement plants to measure Scope 3 emissions.
Our analysis covered 6 of the 15 Scope 3 emissions categories.
The selected categories, namely purchased goods and services,
fuel and energy-related activities, upstream transportation
and distribution, business travel, employee commuting and
downstream transportation and distribution, are considered
relevant to cement activities according to the GCCA analysis, with
only 4 of them being mandatory. Emissions related to downstream
transportation and distribution were independently verified and
disclosed for the first time in our second CDP 2021 report. ERM
CVS reviewed our methodology to ensure that it is aligned with
the GCCA guidance (Cement Sector Scope 3 GHG Accounting and
Reporting Guidance) as well as the GHG protocol. In addition, ERM
CVS verified our Scope 3 emissions, in all selected categories,
in 2021. Scope 3 specific emissions were 103.4kg CO₂ per tonne
of cementitious product, representing about 12.2% of the total
GHG emissions. Fuel-related activities are the main contributor,
accounting for more than 45.0% of the total Scope 3 emissions
at Group level. Purchased goods and services is the second most
important factor, contributing to about 25.0% of the total, while
downstream transportation and distribution is the third most
important category, at about 21.0%. Although Scope 3 emissions
are affected by the specific operating conditions of each facility,
such as the source of raw materials and fuels, product mix and
market fragmentation, transportation distance, transportation
means (e.g. trucks, trains, vessels, etc.), the analysis of the data
showed that the above three categories are the main contributing
factors for the majority of our facilities.
2021 emissions will serve as a baseline and help TITAN identify
the major sources of emissions of its supply chain. The Group will
also start encouraging its suppliers towards making a net-zero
commitment. TITAN Group is continuously refining its Scope 3
reporting approach, identifying gaps and exploring alternative
ways to increase accuracy while establishing the required
management systems needed in consultation with all business
units.
Decarbonization roadmap until 2030
In parallel with the validation of the Group’s CO₂ emission
targets by the Science Based Targets initiative (SBTi) in July 2021,
a thorough internal exercise was initiated in order to establish a
detailed Scope1 decarbonization roadmap until 2030, covering all
traditional reduction levers:
1. Reducing clinker content in the final product (Clinker-to-
cement ratio)
2. Increasing the thermal substitution rate of conventional fossil
fuels by alternative fuels
3. Reducing specific heat consumption through process
optimization and improvements in energy efficiency
A specific methodology developed in-house was applied to all
business units (excl. Brazil), regardless of the existence of local
carbon pricing mechanisms. Participation in this process was
universal and cross-functional; senior and middle-management
from commercial and technical departments across the Group
worked on the project under the guidance and support of the
Group’s Corporate Center.
The outcome confirms TITAN’s ability to achieve its published
and validated by SBTi CO₂ targets. A detailed list of over 90
actions and projects has been compiled, all of which provide
significant cost savings, business-growth opportunities and
decarbonization potential. Total capital expenditure is ca. €150
million and relatively evenly distributed throughout the decade
until the end of 2030.
Material issue: Innovation with emphasis on digitalization
and decarbonization
TITAN continued to invest in research, development and
innovation activities in 2021, covering the entire value chain of
manufacturing and distributing cement, concrete and cement-
based products, with a focus on decarbonization, digitalization
and competitiveness.
Innovation with emphasis on decarbonization
In 2021, TITAN made progress in innovation to address climate
change, both in terms of conventional levers (thermal energy
efficiency, fossil fuel substitution, reduction of clinker-to-cement
ratio), as well as through novel approaches, with an emphasis
on new, lower-CO₂ cementitious products, carbon-capture
utilization and sequestration, and hydrogen technologies.
We implemented new methods developed in-house for the
rapid and accurate evaluation of materials suitable for use in
cement and concrete production with a minimal or zero-carbon
footprint, including by-products and wastes. We proceeded
with the successful thermal activation of locally available clay
materials on an industrial scale, achieving product performance
at par with conventional cement with up to 30% lower CO₂
emissions. We remain highly optimistic that the activated
materials will be part of our sustainable low-carbon solutions,
enabling the transition to the decarbonization of cement and
concrete in many of our geographies. In Greece in particular, the
Patras plant conducted some very successful industrial trials,
including the calcination, in an old existing rotary kiln, of local
flysch, to produce calcined clay, a very active pozzolanic cement
constituent.
With regards to carbon capture, utilization and sequestration
(CCUS), we remain actively engaged in collaborative research
actions, including initiatives supported by institutions at both
a local and regional level. Relevant research activities in 2021
included investigations and pilot preparations on advanced
sorption materials, membranes, oxyfuel, solar calcination and
CO₂ conversion through mineralization and green chemistry.
At the same time, we are continuing to evaluate mature
technologies for industrial deployment, in collaboration with
our industrial and scientific partners for our cement operations
in the EU and the USA. In addition, we are participating in the
Open Innovation Challenge by the Global Cement and Concrete
Association (GCCA), aiming to bring forth novel technological
solutions on carbon capture, calcination, concrete recycling and
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the use of captured CO₂ in construction, in collaboration with
start-ups from across the globe. In this context, we continue to
contribute to research activities of the GCCA Research Network,
INNOVANDI, through our participation in the design and launch
of new projects, as well as through industrial mentorships
aiming to achieve new insights into calcined clays, recarbonation
and efficient clinker calcination. In 2022, we look forward
to obtaining first-hand experience in novel carbon-capture
and utilization technologies, by proceeding with two pilot
demonstrations at our Kamari plant, in Greece, in collaboration
with our partners in EU Horizon2020 projects RECODE and
CARMOF.
In 2021, we closely followed hydrogen use in cement clinker
manufacturing, proceeding with industrial pilots in Greece and
Bulgaria. Initial results showed that significant reductions in
direct CO₂ emissions are possible with hydrogen, especially
when produced through renewable means (“green hydrogen”).
We participated in the call for Important Projects of Common
European Interest on Hydrogen Technologies and Systems (EU
IPCEI on Hydrogen), with the project proposal entitled H2CEM.
In H2CEM we envision to deploy and scale up the use of green
hydrogen, targeting at least an 8% reduction in CO₂ emissions
by 2030.
With a view to developing innovative approaches to
construction, we successfully completed laboratory and pilot
trials involving 3D printing of cement and concrete structures
in 2021. In collaboration with academic and industrial partners,
we are proceeding with two full-scale printing demonstrations
in 2022 while at the same time investigating business
opportunities in the emerging market of 3D printed construction.
During the year, we continued to develop and implement
innovative digital tools, deployed with the use of state-of-
the-art equipment with an emphasis on improving our direct
carbon footprint. Focusing on our core cement manufacturing
technologies, we realized digital pilots using novel systems for
accurately monitoring high temperature processes within our
kilns, maintaining product quality, as well as optimizing the use
of fuels by minimizing fluctuations. In addition, we implemented
new online tools to continuously measure and control particle
size during cement grinding operations, utilizing smart decision-
making software, developed in-house to enhance product
performance. Furthermore, in collaboration with our academic
partners from the Aristotle University of Thessaloniki and the
Centre for Research and Technology Hellas (CERTH), we launched
the DIGIKILN project, co-funded by the Greek state. With
DIGIKILN, we have begun to develop a mechanism-driven digital
twin of the cement kiln, by coupling our long-term experience
on clinker manufacturing with fundamental approaches and
breakthrough computational methods. We developed energy
consumption prediction models for cement mills at Kamari plant,
following data science practices and adopting state-of-the-art
machine learning (ML) technologies. By exploiting historical
sensor measurements and operational data, the models offer
high-accuracy predictions for energy consumption, supporting
energy efficiency and decarbonization. The project was
developed in cooperation with SYMBIOLABS, a spin-off company
of ATHENA Research Center.
Digitalization
TITAN is a pioneer in the digital transformation in cement
manufacturing. TITAN believes that investing in the digitalization
of its operations will enable it to compete successfully in the
new operating model that technology is creating for the building
materials industry.
TITAN established its Group Digital Center of Competence in
2020 to further strengthen the Group’s capabilities to develop
and implement new digital solutions, with an emphasis on the
manufacturing, supply chain and customer domains, built on the
foundation of an integrated data platform and a new flexible and
agile working model for its operations.
In the manufacturing domain, TITAN’s Group Digital Center
of Competence continued the rollout of existing Artificial
Intelligence-based Real Time Optimizer solutions (developed
both in-house and with partners) for its cement manufacturing
lines and developed new ones. The Real Time Optimizers
allow for increased productivity, as well as reduced energy
consumption. In 2021, the Group Digital Center of Competence
installed Real Time Optimizers in plants in the USA, Greece,
Brazil and Southeastern Europe.
In addition, TITAN is rolling out a machine learning-based failure
prediction system tailored to the operating environment of
cement plants, increasing the plants’ reliability and reducing the
cost of reactive maintenance. As of 2021, this system has been
installed in plants in the USA, Egypt and Southeastern Europe.
Finally, TITAN has fully incorporated advanced digital solutions
based on BIM (Building Information Modelling) technology in
its major internal infrastructure deployments (including plant
upgrades, logistics terminals, etc.).
TITAN continued the development of digital twins of the
outbound supply chain network of its business units. The digital
twin of the network enables the use of analytics for supply chain
optimization. In addition, TITAN has invested in telematics
solutions for its outbound truck fleet in business units in the USA
and Southeastern Europe.
Finally, TITAN continued the rollout of its in-house, proprietary,
cement spare-parts inventory optimization analytical
methodology and as of 2021 has implemented it in its cement
plants in Egypt and Greece.
In the Customer Experience domain, TITAN is working on
digitalizing the way the Group interacts with its customers
to improve customer experience and create a more efficient
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commercial operating model. To that end, as of 2021, TITAN has
deployed digital customer applications in business units in the
USA and Europe.
TITAN is supporting its digital transformation journey through
internal and external capability building efforts (e.g., the Digital
Academy established in Greece with an external training partner)
and the development of an ecosystem of partners which includes
start-ups, academic institutions, equipment and systems
manufacturers, specialized advisers, etc.
Resilience of IT infrastructure and cyberattacks
The resilience of IT infrastructure is of high importance for
the sustainability of the Group’s operations. Therefore, TITAN
appointed a Group Information Security manager who reports
to the Chief Information Officer and is responsible for the
development of the organization’s information security strategy
and program. Regional Information Security Managers report to
the Group information Security Manager.
TITAN’s Information Security framework, policies and the overall
IT-related risk management are aligned with the requirements of
the ISO 27001 standard.
TITAN’s information security governance outcomes are:
• Protection of information assets against cyber attacks
• Value delivery through efficient utilization of security
investments
• Performance measurement through information security KPIs
and self-assessment
To strengthen the security and resilience of critical infrastructure
against cyber-attacks, TITAN offers annually online interactive
training to educate all end users, reduce vulnerabilities by
enhancing existing proactive prevention capabilities and building
new ones for rapid detection and response, constantly working
towards the application of best practices and revising our
business continuity plans.
Furthermore, the Group has initiated a major IT project to
implement a common ERP system across all Group entities.
Focus area: Growth-enabling work environment
Caring for and developing our employees is core to the purpose
and values of TITAN and essential to ensuring a growth-enabling
work environment. As such, we aim to cultivate an inclusive
culture with equal opportunities for all our people to grow
professionally within a safe and healthy work environment as
part of our 2025 ESG commitments.
Safeguarding our people and operations against COVID-19
was a priority in 2021 and, as a result, TITAN has managed to
deal effectively with the waves of the ongoing pandemic. In
close cooperation with medical experts, action plans were
implemented at all sites to establish protective measures for
people working on-site, both employees and contractors, and
promote remote working, where possible.
TITAN’s people strategy focuses on the three pillars of learning,
talent, and organization, supported by a foundation of an
engaging and inclusive work environment, fair and transparent
reward management, and effective human resource management
systems. The focus on learning encourages the development of
upskilling and reskilling programs and strengthens leadership,
functional as well as health and safety, decarbonization and
digital skills across the Group. The focus on talent ensures the
attraction, retention and development of the talent necessary
to meet the strategic workforce needs of the company and the
fulfillment of the career aspirations of employees. Finally, the
focus on organization ensures that the structures, processes and
workflows enable our talent to perform.
Material issue: Safe and healthy working environment
Response to COVID-19
TITAN responded to the pandemic through several measures,
including increasing hygiene and sanitization standards,
promoting social distancing, installing plexiglass panels, making
mask use mandatory, offering PCR and rapid testing, and
reducing or canceling travel and large meetings and events. In
addition, medical and psychological support were provided by
experts or through health care programs.
More than 13 initiatives in 7 Group countries were implemented
to mitigate the impact on our employees and business partners,
and to provide humanitarian support to citizens in local
communities. In 2021, we launched information campaigns on
vaccination and encouraged our employees to get immunized.
These campaigns were especially successful in our business units
in Egypt and Turkey, where the share of vaccinated employees
against COVID-19 exceeded 90%. In addition, we collaborated
with local hospitals and NGOs and implemented initiatives
to enable, accelerate and cover the cost of the vaccination
programs for more than 1,500 employees and contractors in the
USA, Egypt, Albania and North Macedonia.
Health and Safety
Guided by the Group Health and Safety policy, which envisages
a work environment that ensures health and safety for
employees, contractors and third parties, we are systematically
strengthening our accident prevention and health promotion
systems in all production and distribution operations.
In this pursuit, the processes of health and safety certification,
site auditing and incident investigation play an important role in
reducing workplace risks and improving safety behavior.
In Europe, Turkey and Egypt, 100% of our cement plants and
more than 83% of our combined ready-mix concrete and
aggregates plants are now certified to the ISO 45001 Health and
Safety Management System, which has replaced OHSAS 18001. In
the USA, all TITAN activities conform to the requirements of the
relevant OHS organizations.
Group Health, Safety and Environment (HSE) audits on an
annual basis all integrated cement plants and, occasionally,
other selected facilities. Installations, behaviors and procedures
are examined and detailed recommendations are made. These
recommendations, together with the recommendations derived
from the investigation of accidents and important near misses,
are implemented by operations management. In 2021, more
than 1,700 audits (internal and external) were conducted in our
cement plants.
While in 2020, COVID-related restrictions caused all Group HSE
audits to be performed remotely (by streaming online video
and audio from the sites to the remote auditors), the improved
conditions in 2021 allowed the return to on-site auditing in most
cases.
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Lost Time Injuries Frequency (LTIFR) for our own personnel stood
at 0.91 LTI per million hours worked. While this figure represents
a slight increase relative to the 2020 LTIFR (0.57 LTIs per million
hours worked), it remains consistent with the continuous
improvement that began in 2017 (LTIFR 2.41) and has yielded an
overall reduction of 62%.
Contractor LTIFR increased slightly, from 1.46 to 1.55 LTIs per
million hours worked.
There were no fatalities.
The average training hours in health and safety per person for
both employees and contractors increased in 2021, despite the
continuing difficulties posed by the pandemic.
The effort to maintain safety awareness in relation to specific
tasks and hazards continued in 2021 by targeting safe work at
concrete-pouring sites , the safe unloading of silo trucks and
safe driving. Safety at concrete-pouring and silo-truck unloading
sites was a focus point in the Group HSE audits. Group HSE
produced a detailed audit guide covering both the unloading silo
truck and the receiving installation. This program will continue
in 2022, as will Next Step in Safety, a multifaceted program for
the prevention of serious incidents, which is already running
in Europe, Turkey and Egypt. Refresher training in Root Cause
Analysis, an important tool in incident investigation, will also be
offered.
Safe driving was also given significant attention. In Greece,
TITAN is implementing a program focusing on the condition of
vehicles. Raw materials transportation trucks, concrete mixer
trucks and concrete pumps are subjected (over and above legal
requirements) to periodic controls at specialized workshops, in
order to obtain or renew the Safety Pass stipulated by TITAN.
In the US, TITAN is employing digital technology to improve the
skills of concrete mixer drivers. Training on a digital Truck Driving
Simulator is helping the drivers to avoid rollovers, while a Safe
Driving system is coaching them to avoid unsafe behavior and
detects rollover precursors in their driving style.
Wellbeing initiatives
TITAN’s legacy of caring for its people continues to evolve
through our 2025 commitment to cultivate a safe and healthy
work environment and implement initiatives addressing the
physical, mental, social and financial dimensions of wellbeing for
our employees, in all countries.
In October 2021, on World Mental Health Day, we launched
a Mental Health campaign, aiming to raise awareness and
promote good mental health across the Group. Addressing local
needs, countries have provided a variety of programs to their
employees, from cyber and live expert talks, smoking cessation
programs, and nutritional support programs to virtual exercise
programs. The campaign included useful resources, such as
relevant articles, videos, and self-assessment questionnaires,
and promoting TITAN Group’s consulting support service, TITAN
EAP (Employee Assistance Program). For example, since 2019
TITAN Greece has established the program “Epilego”, which
promotes self-care and wellbeing through numerous actions
under three themes – nutrition, physical condition and balance.
Typically, every year “Epilego” offers to all employees smoking
cessation programs, nutritional support programs, virtual
exercise programs and online and live expert talks. In 2021,
the series of more than 15 online talks included topics such as
Mindfulness, Self-Care: The Positive Psychology Way, Self-
regulation and inner dialogue, Managing Stress, Understanding
Depression, No Such Thing as a ‘Perfect Parent’, Resilience.
Material issue: Diverse and inclusive workplace
We are committed to creating an environment where all
differences are valued and where everyone has the opportunity
to flourish and experience a sense of belonging. Following the
identification of equality, diversity and inclusion as material
issues for 2020–2025, specific targets were set to increase
female participation the company. These include a commitment
to promote equal opportunities and inclusion, to increase by 20%
the participation of women in senior roles, talent pools and new
hires, and to achieve at least one-third representation of females
on the Board of Directors.
In order to monitor progress towards these objectives, diversity
metrics were analyzed and reported. In addition, we continued
the review and update of key people policies and process,
including the Group’s Resourcing Framework, International
Relocation Policy, People Management Framework and People
Development Process, to ensure that they can positively
influence and support inclusion and diversity across TITAN
Group. Finally, recognizing that achieving our aspirations for
diversity and inclusion in the work we do and the way we work
is an on-going process and one that requires awareness, action,
responsibility and accountability from everyone in our business,
the Group Diversity, Equity and Inclusion Policy was launched in
2022. The policy sets out our principles, definitions, scope and
approach to diversity and inclusion.
The share of women in management increased to 17.6% in 2021
from 16.5% in 2020. Employment by ethnicity in the US, where
employee race data is recorded, has broadly remained stable.
Material issue: Continuous development of our people
Upskilling and reskilling opportunities
We invest in upskilling our people and building the required
capabilities for our organization’s long-term growth. In 2021, as
the COVID-19 restrictions continued, many of our employees
worked remotely. Thus, efforts focused on digital training
reaching all targeted audiences. The virtual learning environment
we have been building for the past years through our Learning
Management System enabled us to operate effectively in this
unforeseen situation.
11,233 virtual training hours were recorded in 2021, corresponding
to 214 courses. Total learning hours in health and safety, and
digital increased by 38% and 251% respectively. In line with our
strategic focus, we defined and created a new Decarbonization
training category in our Learning Management System, while
enriching the Digitalization category.
In addition, we developed e-learning courses to consolidate
practical and advanced in-house knowledge. Cross-regional
and cross-functional in-house authoring teams created these
e-learning courses intended for cement professionals across
the Group. These courses also aim to improve the operation of
our cement plants, resulting in more sustainable use of natural
resources, significant fuel savings, and improved and consistent
product performance.
Some of our business units organized and ran trainings for
a significant percentage of their population. Titan America
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recently went live with its new SAP ERP system, which is used
by the operations, maintenance, quality, logistics, finance,
procurement, and sales teams. Nearly 500 employees from
across the business dedicated 5,600 hours to relevant training.
This initiative trained those employees on how to perform their
day-to-day work functions effectively with the new system.
TITAN Greece launched an additional e-learning program on
Health and Safety, addressed to 260 blue-collar employees.
We continued to invest in an external learning platform to
provide TITAN employees with vast choices in the areas they
need to acquire knowledge and build skills. 97% of the available
LinkedIn Learning licenses have been activated, with nearly
29,000 learning videos viewed by almost 980 employees.
Our “Learning Bites” internal newsletter channels learners
towards new technology trends, which are part of our digital
transformation journey.
Employee engagement and human resources management system
Engaging its employees is a continuous process for TITAN Group,
which incorporates feedback in structured and organized ways,
via group-wide surveys, focus groups and local pulse surveys.
In 2021, we implemented Group and country action plans that
were developed to address the results of the 2019 Employee
Engagement Survey. As a result, a number of initiatives were
introduced, from more frequent employee communications on
strategic priorities and a focus on employee health and wellbeing
across TITAN, to local actions, such as the simplification of
work processes, focused development programs, and the
enhancement of local communication tools and processes.
Employment at TITAN Group, as of the end of the year, remained
stable, with an increased share of women in employment (13.4%
in 2021 vs. 12.4% in 2020). Overall, the Group employee turnover
rate decreased (10.6% in 2021 vs. 11.4% in 2020). Turnover of
female employees decreased from 10.4% in 2020 to 9.1% in 2021.
In 2021, 3,250 employees (61% of our workforce) participated in
annual performance reviews. Participating female employees
were 597 that is 83% of the total female workforce, a figure
similar to the equivalent one in 2020.
We have capitalized on recent investments in human resources
management systems (HRMS) to use data and effectively
manage all key processes throughout the employee life cycle,
from talent acquisition, to performance management, learning
and development, career planning and reward management.
TITAN’s HRMS data on recruitment, learning and performance
are analyzed to provide insights and inform improvement efforts
and investment decisions on future programs. In addition,
performance data and individual development plans are used in
the People Development Review process and Talent Spotlight
sessions, both of which are integral parts of the Group’s
Strategic Workforce Planning process.
Furthermore, we have defined TITAN’s Global Principles for
Hybrid Work Models and outlined the key areas to incorporate
locally. Business units, based on local needs, market practice and
employee expectations have further elaborated and introduced
local remote work practices.
Focus area: Positive local impact
Material issue: Environmental positive impact
With a view to the continuous improvement of the
environmental impact of the Group's operations all of TITAN’s
business units monitor and report their environmental impact,
while also setting targets for the reduction of air emissions,
the protection of biodiversity, quarry rehabilitation, and water
management and recycling.
For almost 20 years, in line with our environmental policy, the
Group has disclosed measurable qualitative and quantitative
targets to monitor progress with respect to its environmental
impact. The Group engages in a long-term process with experts
and stakeholders, seeking meaningful ways to understand
society’s needs and contribute to a net positive local impact for
the communities in which it operates.
The Group is implementing environmental management systems
(EMS) across its operations, realizing solutions that best fit local
needs as well as international commitments. All Group cement
plants have an ISO 14001 environmental management system,
except those located in the USA, which have adopted a system
that is aligned with local and federal regulatory requirements.
Over the years, we have heavily invested in Best Available
Techniques (BAT), reaching and sustaining a strong
environmental performance that meets existing and potential
new regulatory requirements, as well as our own targets, which
are often more demanding.
In recent years, TITAN Group ran an extensive investment
program to install new or upgrade existing de-dusting
equipment in the stacks of kiln lines. Electrostatic (ESP)
filters were replaced either by bag filters or by hybrid filters (a
combination of bag and ESP technology), with the latest example
being the bag filter installed at Kosjeric cement plant in Serbia
in 2021. Consequently, the main stacks are no longer the main
dust sources and efforts are now underway to further reduce
fugitive dust. On that front, we are covering conveyors and
elevators in closed systems, reducing air leakages and spillage
points, ensuring proper maintenance of the installation using
vacuum cleaning, enclosing storage areas with natural wind
barriers, using water spray for road wetting, and focusing on
housekeeping as well as paving where feasible. The systematic
monitoring of fugitive dust emissions safeguards the health of
our employees and reduces the impact on nearby areas. The
Group ensures the proper maintenance and optimal functioning
of machinery and equipment and applies rigorous rules on the
transport of materials within its plant sites and beyond.
Combustion at high temperatures leads to the creation and
emission of nitrogen oxides (ΝOx). Over the years, TITAN has
invested heavily in technologies that reduce NOx emissions, like
Selective Non-Catalytic Reduction (SNCR) systems and low NOx
burners, as well as flame reduction and secondary firing, and will
continue to follow this path in the future.
The presence of sulfur (S) in raw materials is the primary cause
of sulfur dioxide (SOx) emissions. At many of our Group plants,
SOx emissions are negligible. Wherever there is a need, TITAN
Group applies best practices to abate SOx emissions and ensure
compliance with the limits stipulated in the environmental
permits as well as specific conditions set by local authorities.
Monitoring and reporting air emissions are part of the Group’s
effort to mitigate its impact on the environment. In alignment
with legal and sectoral requirements, TITAN monitors and
reports dust, NOx, SOx, TOC, HCl, HF and NH₃, mostly through
continuous emissions monitoring systems. Minor emissions like
PCDD/PCDF and heavy metals are spot measured by accredited
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independent laboratories at a frequency equal or higher
than that mentioned in the relevant permits. In line with our
commitments and permits, dust, NOx and SOx emissions, as well
as CO₂, are covered by independent third-party verification.
Furthermore, air emission dispersion studies, which consider
all local characteristics (atmospheric and geomorphological
conditions) and are conducted in collaboration with local
academics, ensure that the operation of plants does not have
any negative impact on the air quality of the adjacent areas. In
many regions in which the Group operates, air emission data are
available through public platforms, with our cement plants in
Greece, North Macedonia and Serbia facilitating such initiatives,
while our cement plants in Egypt and Turkey are providing similar
information to the local authorities.
Group environmental performance in main air emissions is
presented in the table below:
Group level (cement operations) 2021 2020
Air emissions (g/t clinker)
Specific dust emissions 16.6 19.3
Specific NOx emissions 1,263 1,282
Specific SOx emissions 245 253
Group performance in both NOx and SOx emissions remained at
a level similar to that of 2020 and within the target set for 2025.
Moreover, dust emissions were further reduced by 14.0%, and
were also below the 2025 Group target.
Protection of biodiversity and sustainable land stewardship
are fundamental elements of our sustainability strategy. In
order to mitigate the impacts of raw material extraction on
biodiversity and ecosystems, the Group has developed standard
practices for quarry rehabilitation and biodiversity management
at sites of high biodiversity value, in line with the respective
GCCA Guidelines. Relevant targets have been set for 2025,
underscoring our commitment to contributing to the prosperity
of our local communities and achieving positive local impact
where possible.
Following the results of the biodiversity risk assessment that
was conducted in 2020 for all Group sites with the use of the
Integrated Biodiversity Assessment Tool (IBAT, https://ibat-
alliance.org/), further evaluation was made in 2021 for those
sites that had been identified as in proximity to (or part of)
areas of high biodiversity value. Two new such sites, namely
the Drimos and Thisvi quarries, were identified in Greece, and a
biodiversity study and a management plan will be developed for
them by 2025, as presented in Table TITAN Group Quarry Sites
with High Biodiversity Value of the ESG Statements.
In 2021, TITAN continued to actively participate in the
Biodiversity and Industry Platform that was launched in 2020
by CSR Europe. The platform is a cross-sectoral business-led
initiative that aims to demonstrate how companies are driving
the biodiversity agenda and to support them in the practical
integration of biodiversity into decision-making processes. In
its first year of activities, the platform developed a structured
framework, consisting of a five-step methodology, through
which companies can assess their impact on biodiversity across
their value chain, and follow a decision-making process involving
stakeholder engagement to prioritize actions for biodiversity
management.
Our ongoing efforts to mitigate the local impacts of the raw
material extraction process are reflected in the indicators
presented in the following table, which also monitor our progress
towards the respective ESG targets set for 2025.
Local impact indicators 2021 2020
Active quarry sites with high biodiversity
value (number) 12** 10
Active quarry sites with biodiversity
management plans (number) 10 9
Active quarry sites with biodiversity
management plans (percentage) 83% 90%
Active quarry sites with quarry rehabilitation
plans (percentage) 91% 91%*
Disturbed quarry land areas that has been
rehabilitated (percentage) 22.6% 23.6*%
* Note: the quarries of Titan Cement Egypt (TCE) are no longer considered
to be under full management control of TITAN due to changes in mining
legislation in the country. Therefore, since 2021 all TCE quarries have been
excluded from the baseline and the calculations of the respective local
impact indicators. The 2020 figures have been adjusted accordingly where
appropriate.
** Note: figure reflects the updated situation with the addition of the 2 new
sites (under full management control of TITAN) that were identified in the
2020 Group biodiversity risk assessment as areas of high biodiversity value
and for which the Group intends to develop a biodiversity management plan.
The percentage of active quarry sites with quarry rehabilitation
plans remained at the same level as last year. However, the
rehabilitation plans for these remaining sites are scheduled to
be completed in the next few years so as to meet the respective
target by 2025.
The percentage of land areas rehabilitated out of the total
disturbed land was slightly reduced compared to last year.
Despite the progress made with the rehabilitation activities at
most of our Group Quarries, the opening of a big land area at one
aggregates quarry in Titan America resulted in the deterioration
of the respective indicator. The rehabilitation activities will
however continue at a steady rate in the following years and it is
expected that the respective ESG target for 2025 will be met.
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Falco eleonorae. Courtesy of Hellenic Society for the Protection of Nature,
©Pavlos Andriopoulos
90
The number of active quarry sites with biodiversity management
plans increased to 10, following the completion of the relevant
plan at Agrinio quarry in Greece in 2021. The focus now is now
on the two new sites identified for their high biodiversity value,
namely the Thisvi and Drimos quarries. The goal is to develop
BMPs for all these sites in line with the relevant 2025 target.
Material issue: Social positive impact
TITAN continued to engage with its stakeholders and contribute
to the sustainability of the local communities in all areas where
the Group has operations. TITAN promotes open dialogue
and collaborative actions with stakeholders by implementing
sustainability initiatives in all countries, as mandated by its
target to have Community Engagement Plans (CEPs) aligned with
material issues for stakeholders and UN SDGs 2030 at 100% of its
key operations by 2025.
In total, 142 initiatives were implemented in 2021 at 15 key
operations (integrated cement plants and grinding plants) across
9 countries, with the engagement of 2,750 participants despite
the difficulties caused by COVID-19 restrictions that impeded
social interaction. Almost 2,000 participants were employees of
TITAN, who acted as volunteers. In total more than 0.4 million
people in the local and broader communities of our operations
were direct and indirect beneficiaries of the CEPs, while the
total cost for all our initiatives exceeded €1.3 million (30% of that
amount was contributed in-kind).
All 2021 initiatives were assessed to see whether they met an
adequate or high level of alignment with the material issues
important for both our stakeholders and our business activities
at business unit level. Our analysis on the connection of material
issues with our initiatives was based on the SASB Materiality
Map methodology. We identified the Social Capital area as
the most relevant material issue for our business units, as
addressed by initiatives for community engagement, followed by
Human Capital (specifically for the engagement and wellbeing
of our employees). We found that the areas of Leadership and
Governance, Business Model, Innovation, and Environment
were also relevant, albeit in a smaller number of initiatives.
Our initiatives towards the sustainability of our communities
focused on supporting education (50 initiatives), promoting
voluntary work (34), contributing to community infrastructure
(34), improving skills for new jobs (31), and supporting our
communities in crisis conditions (e.g. humanitarian relief due to
COVID-19 pandemic, natural disasters such as wildfires, etc.).
In relation to the level of business unit engagement with
communities, more than 56% of the initiatives achieved
active involvement of stakeholders, while 35% promoted
good collaboration with participants from the communities
(input of stakeholders in the decision-making to identify best
solutions, agreement on win-win opportunities, and plan for
joint implementation). We remain focused on strengthening
our authentic and distinctive social engagement approach and
enhancing our social positive impact.
In Greece, the devastating wildfires of August 2021, amid an
unprecedented heatwave, burned thousands of hectares of
land and forest and destroyed homes and livelihoods. During
the fires, TITAN cooperated closely with the local authorities
near our sites to make our vehicles and equipment available
for the fire-fighting effort and to create fire-protection zones.
In the direct aftermath of the fires, TITAN donated €0.5 million
to forest fire prevention and protection initiatives. Acting in
tandem with TITAN, the Paul and Alexandra Canellopoulos
Foundation committed another €0.5 million to initiatives
that focus on the medium- and long-term response to the
consequences of the wildfires. The funds are being distributed in
consultation and collaboration with the competent authorities.
Relevant initiatives in progress include the conversion of 50
cement silo trucks to water tanks and their donation to local
authorities as well as the installation of open water reservoirs in
depleted quarries for fire-fighting aerial means. As the crisis was
evolving across Greece, TITAN cooperated closely with the local
authorities in areas where it operates to offer mobile equipment
to competent organizations fighting wildfires and creating fire-
protection zones.
In the USA, Titan America concentrated its efforts on the
improvement of the sustainability of communities through
partnerships. Roanoke plant partnered with local citizens groups
to sponsor the scholarship for a local high school student and
supported the local county’s livestock auction by sponsoring a
collaborative food bank initiative with students to provide food
to citizens in need in the community.
In Bulgaria, we further promoted our internship program focusing
on young people from the local community. Out of a total of 17
interns (11 females), 4 were hired, and another 8 continued their
traineeships in the business unit. In Albania, North Macedonia,
Kosovo, Serbia and Brazil, we enhanced our collaboration
with the neighboring municipalities of our cement plants, by
implementing several initiatives to support youth education
with development programs tailored for local schools that boost
learning opportunities and enhance job skills and employability
while also empowering youth and fostering entrepreneurship. In
Egypt and Turkey, we partnered with local universities to attract
young talent.
TITAN was also active in supporting blood donations in 2021,
in cooperation with governmental authorities and local health
centers, and succeeded in encouraging 579 employees and
contractors in business units to voluntarily donate. In Greece we
also reached an active pool of 646 potential bone marrow donors,
with a track record of 4 donorships until 2021.
In all countries, with Egypt and Albania serving as particularly
good examples, TITAN’s business units were actively engaged
in initiatives to improve local community infrastructure related
to public schools and hospitals, as well as recreation and sports
centers.
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Road Safety initiative, Antea cement plant, Albania
91
In 2021, our approach to community engagement was further
enhanced through the introduction of a new framework to
ensure that our efforts are aligned with TITAN’s principles and
priorities across all business units. Using the ESG databank-
ΤΙΤΑΝ's in-house information management system- as a tool, we
ran a structured assessment of all initiatives and actions across
business units in 2021 to ensure alignment with our material
issues.
Community Engagement Plans (CEPs) 2021
Number of initiatives and actions under the CEPs 142
Participants (TITAN employees, business partners,
NGOs, local authorities, and people from communities) 2,750
TITAN volunteer-employees who were among
participants 1,873
Beneficiaries from communities 447,000
Total amount of “social investment” (contribution
in cash and in kind for the implementation of the
initiatives under the CEPs) €1.3m
Material issue: Economic positive impact
TITAN recognizes the positive economic impact, both direct
and indirect, of its operations on its local communities. The
monitoring and reporting of “local spend” (calculated as the ratio
of the spend on local suppliers to the spend on all suppliers in
each country) according to TITAN standards and following the
UNCTAD Guidance was first introduced in 2019. The ongoing
Group digital transformation process and the unification of
digital systems has enabled TITAN to track local spend of global
activities accurately and efficiently. In 2021 average local spend
accounted for 65.1% of total spend on a Group level, close to
the level of 2020. TITAN’s business units seek to ensure that
two-thirds of our total spend is directed to local suppliers and
communities. This is achieved by implementing a number of
projects, where local companies are selected for the supply of
specific products and services. In addition to the positive impact
on society, this process will help TITAN’s business units receive
competitive products and services in a timely manner and thus
limit risks from global supply chain disruptions.
Focus area: Responsible sourcing
Material issue: Resource efficiency, recycling and recovery,
contributing to the circular economy
TITAN Group is committed to the principles of the circular
economy, taking actions to minimize, reuse, recycle or recover
materials and energy in order to preserve natural resources,
reduce CO₂ emissions and manage waste efficiently.
Having recognized the circular economy as fundamental to the
development of a more sustainable business model, the Group
systematically adopts and applies good practices in order to
minimize its footprint and ensure a sustainable future for coming
generations.
In 2021, we implemented circular economy programs and
practices across all our activities, including the production of
clinker, cement, concrete and concrete blocks and of aggregates
for pavements and other applications. We have crucially reduced
waste and minimized the need for primary raw materials.
We eliminated landfilling of waste while contributing to the
conservation of natural resources and mitigation of climate
change.
The Group continued its efforts to increase the use of alternative
raw materials in clinker, cement and concrete production,
designing and developing new low-carbon cement products to
address the current and future needs of its customers. The use
of alternative raw materials in the production of clinker and
cement slightly increased in 2021 (6.6% of total consumption).
ST Equipment & Technology LLC (STET), a wholly owned
subsidiary of the TITAN Group based in Needham, MA, USA,
explored the potential of using its patented separation
technology to recover, process and reuse fly ash stored
in landfills and impoundments. In 2021, STET began to
generate high quality fly ash product (ProAsh) from the fly ash
impoundment at Brunner Island, which can be used to make a
low-carbon cement substitute.
In Egypt, and after many years of research, in 2021 TITAN
successfully began using bypass dust, a waste of the cement-
making process, in road paving. Following several studies, and
through a collaboration with a major local road-paving company,
the use of bypass as a filler in road paving was successfully
demonstrated. Subsequently, and after securing the relevant
environmental approval for this product, the bypass dust will
be used for road paving. Not only does this usage reduce the
landfilling of bypass dust, but it also substitutes the use of
limestone and clay as a paving filler. In 2021, around 50% of
the produced bypass was successfully recycled as a road-filling
material.
Water management
We seek to conserve the quantity and sustain the quality of
water resources in all our facilities and neighboring areas, and
to reduce the withdrawal and consumption of freshwater, by
establishing recycling and promoting responsible and efficient
practices for water usage and discharge. Effective water
management inside and outside the premises of our sites is an
important aspect of our environmental performance.
Since 2010, we have developed and applied an Integrated Water
Management System (IWMS) at all our operations to monitor
and optimize water consumption and to disclose water data in
a consistent way, according to the international practices and
guidelines of the cement sector.
A water risk assessment exercise was conducted with the use
of Aqueduct (a tool developed by the World Resources Institute)
in 2020 and the results were communicated to all business
units this year. According to this assessment, 73% of the Group’s
cement and cement grinding plant sites, 65% of its quarries for
aggregates and industrial minerals, and 62% of its ready-mix
concrete sites operate in water-stressed areas. As indicated
also by the specific assessment of risks related to climate
change that we made in 2021 in collaboration with recognized
climate-risk experts, water stress poses the third highest
physical risk (after coastal flooding and drought) for the cement
manufacturing facilities throughout TITAN’s global operations.
In this respect, our next steps will involve the evaluation of local
conditions at the sites operating in water-stressed areas, to
identify related risks and opportunities and make the appropriate
decisions to further enhance our practices for sustainable water
management. Priority will be given to the cement plant sites,
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92
which are the larger water users among Group activities, as
presented in the Notes of Table 2.4 of the ESG Statements.
In 2021, total water withdrawal and discharge quantities at
Group level showed an increase of 5-6%, whereas the total water
consumption increased by less than 2%. This increase is due
to the higher production needs in most of the regions of our
operations in 2021.
On the contrary, the specific water consumption at the Group’s
cement and grinding plants and their attached quarries showed
a decrease of 5.7% to 245.7l/t cementitious product, well below
the target set for 2025.
Water recycled as a percentage of overall water demand declined
slightly to 66.1% but is still on track to reach the respective
target for 2025.
Impact on natural resources: Water 2021 2020
Group level (all operations)
Total water withdrawal, million m
3
43.2 41.3
Total water discharge, million m
3
31.9 30.2
Total water consumption, million m
3
11.3 11.1
Group level (cement operations)
Specific water consumption, l/t cement 245.7 260.5
Percentage of water recycled over water
demand
66.1% 67.2%
Energy efficiency management
Improved energy efficiency is a prerequisite, not just for
addressing climate change, but also for preserving resources,
enhancing energy safety and reducing the reliance on imported
fossil fuels.
In 2020, in the context of its new Environmental, Social and
Governance (ESG) targets, TITAN Group committed to have 85%
of its clinker production covered by ISO 50001 or energy audits by
2025.
In 2016, the Group made its first step in applying energy
efficiency management systems in its cement production plants.
The Tokat integrated cement plant in Turkey was the first TITAN
plant to be certified according to ISO 50001, followed by the
Greek and USA-based integrated cement plants. Our integrated
cement plant in Bulgaria is also covered by energy efficiency
audits. In 2021, the Group continued to expand the use of energy
efficiency management systems, with the Alexandria and Beni
Suef integrated cement plants in Egypt and the Usje integrated
cement plant in North Macedonia successfully completing the
process and receiving their Energy Efficiency Management
Systems certifications according to the international standard
ISO 50001:2018.
As a result, the Group’
s clinker capacity covered with ISO 50001
now represents 86.2% of its total clinker production, exceeding
the target of 85% set for 2025 and showing a significant
increase compared to the 54.9% achieved in 2020.
Waste management
In the context of the global transition towards a circular
economy, TITAN Group has worked steadily on the reduction
of landfill waste. Since 2016, TITAN’s cement plants in the
USA and Turkey have received zero waste certifications,
having demonstrated diversion of waste from landfill through
reducing, reusing, recycling, or composting discarded material.
In 2021, TITAN’s cement plants in Greece – Kamari, Patras and
Thessaloniki – were also certified under the “Zero Waste to
Landfill” standard, receiving the highest Platinum rating as a
result of diverting virtually 100% of plant waste from landfill.
As a result, the Group’s clinker capacity covered with “Zero
Waste to Landfill” certification now represents 56.2% of its total
clinker production, exceeding the target of 50% set for 2025 and
showing a significant increase compared to the 29.5% achieved
in 2020.
Waste produced by the Group as part of its everyday activities
is collected, stored and disposed of through authorized
contractors for reuse, recycling or recovery, with the aim
to minimize landfill. As a result, the percentage of the total
waste produced that was recycled increased slightly to 83.6%,
compared to 82.6% in 2020. Furthermore, the percentage of
concrete returns diverted from landfills have stood consistently
over 85.0% in the last five years, reaching 86.0% in 2021.
Material issue: Reliable and sustainable supply chain
In 2021, TITAN continued its Group Procurement transformation
program by further improving the sourcing efficiency of the
strategic purchasing categories managed centrally by the
Group Procurement Department (global categories), with a
more extensive focus on supply chain sustainability topics.
Supplier landscape optimization, building and maintaining
long-term supplier relationships and a holistic review of supplier
performance (including sustainability) are key elements for
enabling “total cost” optimization, transparency of value
creation and the propagation of sustainability practices in the
supply chain.
The Group has also developed a Sustainable Supply Chain
Roadmap which outlines specific milestones and deadlines
to timely achieve the target of ensuring that 70% of our
key suppliers meet TITAN ESG Supplier standards by 2025.
In accordance with this roadmap, a first ever TITAN Group
Procurement Policy was developed and made official in July
2021. The Procurement Policy sets forth the fundamental
principles governing procurement in TITAN, incorporating
upgraded procurement practices that enhance the Group’s
commitment to be a socially responsible, ethical and
environmentally sensitive business organization.
Finally, the Group initiated a process to further develop and
expand the respective ESG criteria for use in the evaluation
of its key suppliers. Our key suppliers have been defined
as critical suppliers according to the GCCA Guidance for
Sustainable Supply Chain management, with a meaningful
level of spend (i.e. 80% of total spend) for each business unit.
Critical suppliers are the ones who may mostly influence
sustainability drivers for the company (e.g. provoke disruption,
affect brand, etc.) because of ESG impacts that they may
have (e.g. contractors who violate safe conditions or have no
permit to operate legally). The newly developed ESG criteria
are in line with the GCCA guidelines for Sustainable Supply
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Chain management and the UN Global Compact principles,
including the areas of compliance with laws, regulations and
social customs, human rights, labor rights, health and safety,
environmental management, climate change, anti-corruption
and transparency.
TITAN’s efforts to engage with our suppliers on climate change
have been recognized by CDP with an “A-” score in the CDP
Supplier Engagement rating, which is in the Leadership band of
CDP.
Product responsibility
TITAN offers a wide range of cement and concrete products to
its customers, meeting the growing demand for sustainable
construction in all areas of activity. It is widely accepted that
concrete exhibits some of the lowest carbon footprints among
construction materials, allowing for durable construction
with increased service life. In addition, responsible use of
concrete enables further reductions in CO₂ emissions across
multiple sectors, including renewable energy generation (e.g.
foundations for wind towers), resilient infrastructure (roads
and bridges) and optimal use of energy for heating and cooling
residential and office buildings (especially compared to other
building materials with lower thermal capacity). Concerning
cement products, a significant part of our portfolio includes
products manufactured with clinker content lower than that
of Type I/II or CEM I cements. Also, TITAN offers, through its
subsidiary Separation Technologies LLC (ST), valorized fly ash
for use in concrete, a product with very low associated carbon
emissions that directly replaces cement, allowing for enhanced
emission reduction in the value chain. As per the Group’s
definition, lower carbon products represent approximately 40%
of our portfolio of cement and cementitious products.
In 2021, a new bagged cement- in a water-soluble sack- was
introduced in Greece under the name EcoSack. The launch of
this innovative product, available in distinct green packaging,
responds to the market’s need to improve productivity on
construction sites and, at the same time, contributes to the
promotion of sustainable development and circular economy
practices which rely on minimizing waste, reusing, recycling
or recovering materials and energy, as well as on designing
products that, throughout their lifecycle, will contribute to the
conservation of natural resources, efficient management of
waste, and reduction of CO₂ emissions.
Also, in 2021, Interbeton, a subsidiary of the Group in Greece,
launched an innovative ready mixed concrete that is reinforced
with structural fibers, branded Interforce. The new product can
be used in commercial slab construction, displacing the use of
wire mesh and economizing up to 5 kgCO₂ per square meter
of application. Furthermore, Interbeton developed the Viridia
ready mix product line, targeting residential and commercial
construction. The innovative product is designed for extended
durability under chloride ingress or carbonation, thus negating
the need for costly and carbon intensive structural repairs
during a project's lifetime.
Regular customer satisfaction surveys are implemented in the
regions where we operate, helping us understand customers’
needs. For instance, in TITAN America, we conducted a “Net
Promoter Score” customer survey at both Pennsuco and Roanoke
cement plants. The results of the survey were incorporated into
our product quality and business development strategy.
Furthermore, the Roanoke cement division created an outreach
program to educate architects and engineers about low carbon
building materials and encourage the specification of more low-
carbon cements.
In 2021, TITAN Greece completed a full Life Cycle Analysis (LCA),
according to ISO 14040 and EN 15804, for all cement products
produced in Greece, and developed an Environmental Product
Declaration (EPD) for each separate cement product at plant
level, as well as for most commercial ready mixed concretes.
The LCA, as well as the EPDs, are assessed and reviewed by
an independent and nominated body and published in The
International EPD® System.
All Safety Data Sheets of our products comply with the
European Regulation on Chemicals (REACH) and Classification
Labelling Packaging (CLP) Regulation requirements in providing
health, safety and environmental information. Particularly for
bagged cement, information for safe use is printed on the bag,
while for bulk cement customers, all relevant information is
provided with the delivery document. For cements traded in EU
and UK, the relevant cement product SDS are registered with
the competent authority in each country.
In 2021, TITAN Greece bagged cement products were verified by
an independent third party as compliant with the water-soluble
hexavalent chromium content regulatory limit of Regulation
(EC) 1907/2006. Assessment was based on the EN 196-10
evaluation scheme and a relevant certification of conformity
was issued.
Good governance, transparency and business ethics
TITAN Group is strongly committed to conducting business
in accordance with the highest standards of integrity and
ethical business practices. Compliance with high governance
standards to address and manage risks related to bribery and
corruption and human rights throughout the Group’s operations
is considered fundamental in the implementation of TITAN’s
sustainability strategy. TITAN’s Code of Conduct and Policies
ensure, beyond compliance with applicable laws and regulations,
the commitment to international norms and standards, including
the UN Guiding Principles for Business and Human Rights and
International Law against Bribery and Corruption. It is imperative
that governance and ethics considerations are properly
addressed at Group level and this is ensured through a consistent
management approach and a strong governance structure,
prescribed by the Group Corporate Governance Charter.
Anti-bribery and corruption
Bribery and corruption constitute a threat for businesses and
societies across the world, one that impairs ethical values,
enables crime and illegal activity, undermines equal opportunities
in doing business and imposes a huge financial cost on societies.
Consistent with our values and culture, and as clearly articulated
in the TITAN Code of Conduct and relevant Group Policies, the
Group follows a zero-tolerance approach towards bribery, fraud
and any other corruptive practice.
All initiatives and efforts to fight corruption are supported by and
effected through a strong organizational structure that sets clear
roles and responsibilities and provides increased assurance for
good governance and solid ESG performance. The Audit and Risk
Committee, a Board Committee comprised by non-executive,
independent board members, is delegated to oversee, among
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94
others, the risk of corruption and fraud. The Group Compliance
and Anti-Fraud Department, as part of the Group Internal
Audit, Risk and Compliance Department, maintains the overall
responsibility to monitor compliance risks and to coordinate
relevant controlling activities, in cooperation with management
and the Legal Department.
Our Anti-Bribery and Corruption Policy sets forth principles, rules
and responsibilities, specifies high-risk areas in which bribery
and corruption may most often occur during business activities
and provides guidance for preventive and detective procedures,
including the performance of risk assessment activities and due
diligence of third parties who perform services for or on behalf of
TITAN Group.
The TITAN Group Anti-Fraud Program sets out our strategic
priorities and efforts to deter and detect occupational fraud
and corruption throughout the Group, aiming to provide a
protection shield for assets and resources, corporate reputation
and credibility, cultural strengths and operational efficiency. A
comprehensive structure of anti-fraud initiatives and controls
is deployed, contributing to the prevention and detection of
occupational fraud as well as the response of the Group in such
event.
Responding to the need for enhanced anti-fraud awareness, the
Anti-Fraud Program Framework was developed during 2021 and
widely communicated throughout the Group. The Framework
promotes openness and transparency, provides standards and
guidelines, and clarifies roles, expectations and responsibilities
on the subject of occupational fraud.
Among preventive actions, the Fraud Risk Assessment projects,
conducted in risk areas, aim to identify and remediate potential
gaps and weaknesses in the applied anti-fraud preventive
controls, through consistent and effective action plans.
Compliance Program and Group Policies
Compliance risks are proactively addressed at Group level through
the TITAN Group Compliance Program, an integrated system of
relevant activities, mechanisms and controls that aim to provide
adequate assurance that compliance risks are timely identified,
properly assessed and effectively mitigated. The Compliance
Program reinforces compliance culture, ensures adherence to
compliance requirements and fosters ethical behavior.
The set of Code of Conduct and Group Policies, applicable to all
TITAN Group operations, covers all strategic areas and provides
guidelines to employees and external business collaborators (i.e.
vendors, customers), to ensure compliance with the applicable
internal and statutory rules.
Group Policies include, but are not limited to, Anti-Bribery
and Corruption, Conflict of Interest, Competition Law,
Sanctions, Corporate Social Responsibility, Whistleblowing,
Environmental and Climate mitigation, Protection of Personal
Data, Human Rights, Occupational Health and Safety.
All TITAN Group employees have free and unrestricted access
to the Group Policies, which are available on the Group Policies
Repository in the Group Intranet. A separate section offers
translations of Group policies in all local languages. Group policies
are also communicated to our internal and external stakeholders
through our website (https://www.titan-cement.com/about-us/
corporate-governance/group-policies).
A key hallmark of the TITAN Group Compliance Program is
awareness, training and continuous advice, as we consider
it imperative that our people are adequately informed and
supported in this continuous effort. To this end, the second phase
of the TITAN Group Policies Awareness Program, comprising
e-learnings, and assessment tests for the Code of Conduct and
the set of Sustainability and Social Responsibility Policies, was
implemented during 2021. The e-learnings were assigned to the
general population through the learning management system
platform and during the year around 1,500 employees took part in
6,400 training hours in total.
Human rights
Human rights is a material issue for employees and TITAN
suppliers, local communities, but also regulators and civil
society organizations. TITAN Group is committed to respecting
fundamental human and labor rights, in full alignment with
international norms and standards in all operations. Accordingly,
an overview of potential risks to be addressed both in the
workplace and in the supply chain is an integral part of the
materiality assessment process that covers all countries in which
the Group currently operates. As a follow up, a country-specific
risk assessment is planned for 2022, as there are considerable
differences in the enforcement of international human rights
norms from country to country. A certain priority for the Group is
the protection of labor rights and safe working conditions among
contractors’ employees, particularly under the extraordinary
conditions of COVID-19. We have not identified consequences
in the areas of environment, human rights or/and anti-bribery
and corruption compared to the pre-pandemic period. We
measure the progress on these objectives through a set of key
performance indicators, corresponding to advanced criteria which
satisfy the Communication on Progress requirements of the UN
Global Compact Network.
Human rights is one of the key subject areas of the TITAN
Group Compliance Program, which provides a well-structured
framework to address relevant activities in a disciplined and
holistic way across the Group. The set of commitments, are
clearly articulated in the TITAN Group Human Rights Policy.
Among the practices that are strictly prohibited are forced
labor (including slave labor), human trafficking, and inhumane
treatment of workers, child labor and discrimination.
The TITAN Group Procurement Policy, released in 2021, clearly
sets as a prerequisite for our suppliers to comply with all laws
and regulations and respect human and labor rights in their
business activities, and to establish a safe working environment.
Contractual clauses embedded in contracts describe in detail the
above requirements.
Diversity and inclusion are also identified as priorities for
the Group, and are important for the business and for key
stakeholders, including suppliers, customers and local
communities in addition to employees. We seek to maintain an
environment where everyone has a strong sense of belonging
and inclusion, preserving ethnic diversity and not to tolerate
discrimination, bullying or harassment. Our Diversity, Equity
and Inclusion Policy was approved by the Group Executive
Committee in 2021 and launched in 2022.
Intensifying our efforts to ensure compliance not only with
regulatory but also with ESG requirements, a comprehensive
Third-Party Due Diligence system, supported by an online tool,
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was fully developed in 2021 and is ready to be put in operation.
The objective is to provide across the Group the possibility for
effective, fast, reliable and efficient due diligence, through a risk-
based selection of counterparties, providing adequate assurance
and ongoing monitoring over sanctions risks, ESG risks, other
regulatory concerns and reputational risks.
The EthicsPoint platform, a uniform, anonymous and strictly
confidential channel for reporting incidents of non-compliance,
reiterates TITAN’s openness and transparency, safeguarding
good governance and integrity. The platform, to which all Group
employees have free access, ensures that incidents are reported,
examined and resolved with a remedy plan when necessary. A
five-member Supervisory Committee at Group level, including
the Chairman of the Audit and Risk Committee, oversees the
investigation and handling of reports, ensuring confidentiality
and non-retaliation for whistleblowers. In 2021, 11 cases in total
were reported through the EthicsPoint platform, 10 of which were
classified as allegations and one as an Inquiry - complaint (see
ESG performance statements 2021 for more details)”.
TCFD framework implementation (Climate change risks
and opportunities)
The 2015 Paris Agreement on Climate Change, the United Nations
Sustainable Development Goals and the Intergovernmental Panel
on Climate Change call for accelerated and decisive action to
reduce greenhouse gas (GHG) emissions and to create a low-
carbon and climate-resilient economy.
In June 2017, the Task Force on Climate-related Financial
Disclosures (TCFD), established by the G20’s Financial
Stability Board, published recommendations to encourage
financial institutions and non-financial companies to disclose
information on climate-related risks and opportunities. The
TCFD recommendations are widely recognized as authoritative
guidance on the reporting of financially material climate-related
information. The European Commission encourages companies
to implement them. Construction and building materials are
vulnerable to climate-related transition and physical risks.
Transition risks, such as the introduction of carbon pricing
policies, have the potential to increase operational costs
throughout the value chain. Physical risks, such as extreme
weather events, could disrupt supply chains, halt operations and
damage valuable assets.
The Board of Directors, which has the overall responsibility to set
the company’s sustainability strategy, has placed climate change
at the forefront of TITAN’s sustainability agenda.
The Group undertakes on a regular basis a systematic exercise
to assess all material risks faced by the Group that could affect
its business model and performance. This exercise identifies the
Group’s main hazards as well as the most vulnerable geographical
areas in which TITAN operates.
These core and complementary governance mechanisms are
supported by the Group Research, Innovation and Quality
department, the Group Strategic Planning and Group Internal
Audit, Risk & Compliance departments and the Group ESG
performance department.
In 2021, under the supervision of its main governance body for
climate-related issues (ExCo Sustainability) and in collaboration
with recognized climate-risk experts, the Group worked on
identifying, assessing and managing the risks from climate
change, and the opportunities from the transition to a low-
carbon economy, in alignment with the TCFD Framework which
is demonstrated on page 41.
The main elements of the Group’s approach are:
• the exposure of our assets to hazards related to climate change
• the vulnerability of our assets to hazards related to climate
change
• the financial risks presented to our assets by the hazards and
their relevant vulnerability
Specific metrics are used to measure the impact of each hazard
on our assets using a reference baseline. Our methodology
covers both physical risks, like temperature, flooding and
water stress, as well as transition risks, like carbon pricing,
reputational damage and litigation. In addition, opportunities
related to climate change are also analyzed and quantified. The
methodology is built on principles similar to catastrophe risk
models, but is driven by climate model and socioeconomic model
data on climate-related hazards, driving econometric models
with hazard inputs and business data, and translating risk into
financial terms to provide decision-relevant insights.
Our analysis uses two climate-change scenarios based on
the Representative Concentration Pathways (RCPs) from the
International Panel on Climate Change (IPCC), namely the RCP8.5
and RCP4.5. RCP8.5, the “high emissions” scenario, is related to
an expected increase of the global mean surface temperature in
2100 in the range of 4.2 to 5.4
°C
. RCP4.5, and the “low emissions”
scenario, is related to an expected increase of the global mean
surface temperature in 2100 in the range of 1.7 to 3.2
°C
.
The climate-related scenario assessment covers the cement
manufacturing facilities throughout TITAN’s global operations,
encompassing 15 of our cement manufacturing facilities in 9
countries across Southeastern Europe, North Africa, Turkey
and the USA. The main physical risks for the Group already
identified are coastal flooding, drought, water stress and extreme
temperatures. The Group faces the highest physical risk from
coastal flooding while drought poses the second highest physical
risk. TITAN faces minimal or no risk from tropical cyclones.
Financial impact from physical risks can be seen in Chapter C2 of
the CDP questionnaire.
2021 was a year of multiple wildfires in Greece after a historic
heatwave in the Mediterranean area (Greece, Turkey, etc.). The
devastating fires resulted in thousands of acres of scorched land
and loss of property. Our assets and our supply chain were not
impacted. TITAN cooperated closely with the local authorities in
Greece to mitigate the consequences of the wildfire as one can
see in the chapter “Social positive impact”.
Our decarbonization plans can significantly mitigate transition
risks in the medium and long term. Within TITAN's geographical
footprint, legally binding climate change rules are implemented
mainly in the EU (ETS) and in Egypt (CO₂ emissions cap), where
gross Scope 1 emissions of our operations represent 51.2% of
total Group Scope 1 emissions. Under the current regulatory EU
framework, Titan’s financial exposure to the ETS is minimized
as the Group has no shortfall of ETS emission rights based on
its existing operating model. The Group’s plants in Greece and
Bulgaria, where the EU Emissions Trading Scheme (EU ETS) is
in force, are entering Phase IV (2021–2030) with a surplus of
rights, which should last for at least five years assuming there is
no significant change in the EU ETS rules, thus minimizing the
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96
Group’s financial exposure. The price of CO₂ rights will become
critical for the Group if the regulatory framework changes in a
way that a shortfall is created.
Furthermore, transition opportunities related to climate change
have been identified as follows:
• Innovation: development of new low-carbon products to
address new customer preferences
• Energy: sourcing of low-emissions energy that can lead to
reduced energy costs
• Cost: improvements in energy efficiency across production and
the supply chain and efficient use of materials, water and waste
management can lead to cost optimization.
The links with the TCFD pillars are available on page 41 of this
report.
ESG criteria in remuneration policy
TITAN recognizes that linking environmental, social and
governance (ESG) performance to executive pay can help hold
executive management to account for the delivery of the
Group’s ESG targets, while strengthening the oversight of the
sustainability agenda at Board level.
As per the Group’s remuneration policy, a three-year target that
is compatible with the path to reduce our net CO₂ emissions to
500kg per tonne of cementitious product by 2030 is included
in the performance objectives of the deferred compensation
incentive for executive members of the Board and the members
of the Executive Committee. In addition, 5% of the Short-
term Incentive Scheme (STIP) is linked to the Lost Time Injury
Frequency Rate.
Taxonomy EU Regulation implementation
In 2021, TITAN encompassed in its reporting framework the
requirements of the EU Taxonomy Regulation (EU) 2020/852,
as supplemented with the respective Commission Delegated
Regulation EU 2021/2178 of 6 July 2021 especially for climate
change mitigation and adaptation (EU 2021/2139), which specifies
the content and presentation of information to be disclosed by
undertakings concerning environmentally sustainable economic
activities, and specifies the methodology to comply with that
disclosure obligation.
In compliance with Article 8 of the Taxonomy Regulation, we
screened all our taxonomy-eligible economic activities in 2021
and we disclose the prescribed indicators of turnover, capital
and operational expenditures. It was concluded that the main
Taxonomy-eligible economic activity is manufacture of cement
(EU description refers to “manufacture of cement clinker, cement
or alternative binder”). The economic activities in this category
could be associated with NACE code C23.51 in accordance with
the statistical classification of economic activities established
by Regulation (EC) No 1893/2006. An economic activity in this
category is a transitional activity as referred to in Article 10(2) of
Regulation (EU) 2020/852 where it complies with the technical
screening criteria set out in this Section. The activity complies
with the criteria set out in Appendix A to this Annex for climate
adaptation.
In addition to clinker and cement manufacturing, the processing
of fly ash could also be considered as a Taxonomy-eligible activity,
although not economically material to disclose.
According to the Regulation and based on the Group consolidated
data, €1,004.7m or 58.6% of the Group turnover in 2021 comes
from Taxonomy eligible activities while the total respective
CapEx corresponds to €74.3m (58.9% of total CapEx) and the
total Operating expenditures correspond to €71.0m (60.5% of
total Operating expenditures). Revenue from fly ash processing is
around 0.1% of the total Group turnover.
More data and information on the Taxonomy KPIs as for the
proportion of the respective turnover, capital and operational
expenditures over the total figures for TITAN Group are provided
in the ESG Performance Statements section. The definitions for
the KPIs were adopted by TITAN as in the Commission Delegated
Regulation (EU) 2021/2178 (Annex I: KPIs of non-financial
undertakings).
In specific the turnover covered the revenue recognized pursuant
to International Accounting Standard (IAS) 1, paragraph 82(a), as
adopted by Commission Regulation (EC) No 1126/2008 (1), and as
defined in Article 2, point (5), of Directive 2013/34/EU. The capital
expenditures (CapEx) covered additions to tangible and intangible
assets during 2021 considered before depreciation, amortization,
and any re-measurements, including those resulting from
revaluations and impairments, for the relevant financial year and
excluding fair value changes. Under the CapEx figure, we included
costs that are accounted based on IAS 16.73 (e)(i)(iii), IAS 38.118
(e)(i), IAS 40.76 (a)(b), and IFRS 16.53(h). For calculating the figure
of operational expenditures (OpEx), we considered all direct
non-capitalized costs that relate to research and development
(research and innovation investments), building renovation
measures, short-term lease, maintenance and repair, and any
other direct expenditures relating to the day-to-day servicing of
assets of property, plant, and equipment by TITAN or third party
to whom activities are outsourced, that are necessary to ensure
the continued and effective functioning of such assets.
In the ESG Statements, Table 2.5.2, we provide detailed
figures for the KPIs of Turnover, CapEx and OpEx, and Notes
for the contextual information according to the requirements
of the Taxonomy Regulation, and explanation for the TITAN
accounting policy specifically for these disclosures. Specific
data for calculating the KPIs, referring to Turnover and CapEx
are disclosed in the Financial Statements. For the Turnover,
see “Financial Statements”, section “Consolidated Income
Statement”, page 149, and Note 3 “Operating segment
information”, page 171. For the CapEx, see “Financial Statements”,
section “Financial performance overview” page 145, and Note 3
“Operating segment information”, page 171.
Independent assessment of ESG performance
We are committed to continuously improving our sustainability
performance and further aligning our targets with the
expectations of our stakeholders. To this end, we engage with
ESG Rating agencies, valuing their assessments and feedback.
In addition, by responding to the CDP climate change and water
security questionnaires, we are stepping up our efforts to provide
increased transparency in our environmental disclosures.
In 2021, Titan Cement International received an upgraded MSCI
ESG Rating of “AA”. MSCI ESG Research provides ESG Ratings on
global public and a few private companies on a scale of “AAA”
(leader) to “CCC” (laggard), according to exposure to industry-
specific ESG risks and the ability to manage those risks relative to
peers.
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97
TITAN Cement Group was also recognized by the CDP (formerly
Carbon Disclosure Project) as a global climate leader for its
transparency and actions to mitigate climate change and
transition to a net-zero economy. With an “A-” score, TITAN
Cement Group ranks in the top 15% of publicly disclosing
companies globally and is one of only five Cement sector
companies (out of 27) to achieve this level in 2021. Companies
reaching the Leadership level represent best practice through
their comprehensive disclosure of environmental data, thorough
awareness of risks, demonstration of strong governance and
management of those risks, as well as the implementation of
market-leading best practices.
Furthermore, and in line with our commitment to open and
transparent communication with our stakeholders, in 2021 we
responded to the Carbon Disclosure Project (CDP) Water Security
questionnaire and achieved a “B” score, which corresponds to the
management band where companies “take coordinated action on
water issues”.
For more information on the Group’s ESG performance
assessment by ESG Rating agencies, please visit the corporate
website (https://www.titan-cement.com/sustainability/esg-
ratings/)
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ESG performance statements
TITAN’s approach for ESG Performance reporting
In 2021 the approach of ΤΙΤΑΝ Group for integrated ESG Performance
reporting on the basis of voluntary commitments to IIRC principles,
UNGC Communication on Progress according to Criteria Advanced Level,
GCCA Charter and Guidelines, and connection with the Sustainability
Accounting Standards Board (SASB) Framework, was expanded for
covering the Regulatory requirements of the EU Taxonomy, and the
TCFD requirements for climate-related risks.
In more specific about Taxonomy: TITAN encompassed the requirements
of the EU Taxonomy Regulation (EU) 2020/852, as supplemented with
the respective Commission Delegated Regulation EU 2021/2178 of 6 July
2021 in specific for climate change mitigation and adaptation. The
Regulation specifies the content and presentation of information to be
disclosed by undertakings concerning environmentally sustainable
economic activities, and the methodology to comply with that disclosure
obligation. TITAN complies in this Report in more specific with the
requirements on disclosures pursuant to Article 8 of the Regulation, for
its EU Taxonomy-eligible economic activities in their total turnover,
capital, and operational expenditures, these being the key performance
indicators (KPIs) set by the Regulation and provides qualitative
information (description) for its Taxonomy-eligible activities and
investments. TITAN made a screening of all economic activities in 2021
based on the classification set by the Regulation. It was concluded that
the main Taxonomy-eligible economic activity is the manufacture of
cement clinker, cement or alternative binder (NACE code C23.51, in
accordance with the statistical classification of economic activities
established by Regulation (EC) No 1893/2006). In addition, the production
and sale of fly ash could also be considered Taxonomy-eligible activity
(NACE code E38.32), although not economically material to disclose due
to very low share in the total Group turnover.
Baseline years: For committing on targets 2025 and reporting on
progress for all other environmental parameters except CO
2
, the base
line year is 2020. Also 2020 is used as base line for SBTi Targets on CO
2
emissions. For CO
2
emissions other than SBTi the baseline year for
relevant target(s) is 1990 in line with the Kyoto Protocol.
Changes in the structure and content of the 2021 Integrated Annual
Report:
Materiality: TITAN’s framework of material issues, as outcomes of the
last cycle for materiality assessment for the Group (2019), is presented in
Table 1 of the ESG Statements. In this framework we have connected the
outcomes of BUs’ materiality, again following the outcomes of
assessment in the most recent cycle for each country/BU level
completed between 2020-2021. The connections provide a more inclusive
approach of materiality for TITAN, which is seen as a bottom-up and top-
down approach and combines the merits of BU level analysis and
engagement with the Group level blueprint and guidance.
Restructuring of the ESG KPIs Index: All disclosures for the performance
KPIs for the areas of Environment, Social and Governance, were
restructured by following the outcomes of materiality assessment on
Group level, with using the "compass" of TITAN’s Focus Areas. The
respective KPIs for ESG performance were aligned according to material
issues mostly relevant under each of the Focus Areas. The new approach
for our ESG Statements aimed at providing to the external as well as
internal stakeholders an efficient flow of metrics around disclosures of
performance focused on TITAN’s materiality framework and connected
with TITAN’s targets 2025 and beyond. See Tables 2.1, 2.2, 2.3, 2.4, and
2.5, aligned with the Focus Areas of TITAN’s materiality: 1. De-
carbonization and Digitalization, 2. Growth-enabling work environment,
3. Positive local impact, and 4. Responsible sourcing. All underpinned by 5.
Good governance, transparency, and business ethics.
New disclosures under the Focus Area Decarbonization and Digitalization,
Table 2.1: Scope 1 gross and net direct CO
2
emissions, also with regional
performance data and % clinker production emissions coverage rate,
Scope 2 CO
2
emissions, and Scope 3 emissions, also with regional
performance data, % clinker production emissions coverage rate, and
specific CO
2
emissions per t cementitious product. Also, we report on
sustainable products as part of our cement production, disclosed as %
cement production, and annual investment in research and innovation.
New disclosures under the Focus Area Growth-enabling work
environment, Table 2.2: We added the KPIs for wellbeing initiatives for
employees, % turnover breakdown by gender and age structure, % share
of employees with performance evaluation and % share female
employees with performance evaluation, also % share of female
employees in talent pools.
Under the Focus Area Positive local impact, Table 2.3, we added the KPIs:
% employees from local communities, % share of Internships from local
community, total number of Initiatives under community engagement
plans, total number of participants to community engagement plans,
TITAN employees as volunteers to community engagement plans, total
amount of "social investment" for the implementation of these
community engagement plans, and blood donations (TITAN employees,
business partners and communities).
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Under the Focus Area Responsible sourcing, Table 2.4, we added KPIs for:
water withdrawal and discharge, % water demand covered with recycled
water, also regional performance in water consumption, regional
performance in specific thermal energy consumption, Group performance
and regional performance in specific electrical energy consumption, %
renewable energy as part of total electrical energy consumption, number
of integrated cement plants with “Zero Waste to Landfill” certification,
and Key suppliers meeting TITAN ESG standards.
Last, under the Focus Area Good governance, transparency, and business
ethics, we added the information under the Table 2.5.1 for: Number of
nationalities represented on the Board, Number of meetings and
attendance rates of the Audit and Risk Committee, the Nomination
Committee, and the Remuneration Committee, also the KPI for
Grievance mechanism (Ethicspoint) coverage, % unionized employees,
and % employees covered by Collective Bargain Agreements.
New Tables under the ESG Statements as new KPIs and supplementary
information supporting our disclosures for Governance: 2.5.2 Taxonomy,
2.5.3 ESG Polices, 2.5.5 Political contributions & Fines and other non-
monetary sanctions, and 2.5.6 Environmental Audits. Also, we added
under the Focus Area Good governance, transparency and business
ethics the Tables 2.5.4 Group Management Systems, 2.5.7 Consolidated
Report on Payments to Governments for extractive operations, and
2.5.10 Notes for Value Creation Indicators.
See Notes below for facilitating the ESG performance statements review
(in connection with KPIs under Tables 2.1, 2.2, 2.3, 2.4, and 2.5).
Assurance: Specific KPIs included in the scope of ERM Certification and
Verification Services (ERM CVS) assurance engagement (ERM CVS’
“Independent assurance statement”).
GCCA: Specific KPIs calculated according to sector commitments
integrated by TITAN, following the GCCA Charter and Framework
Guidelines.
UNGC: TITAN follows the reporting requirements for meeting the criteria
of UN Global Compact concerning to a Communication on Progress (COP)
Advanced Level.
UNCTAD: TITAN has adopted under its reporting framework the
applicable KPIs according to the Guidance of UNCTAD, as supplementary
to the above Reporting Standards.
TCFD: TITAN started reporting according to the recommendations of the
Task Force on Climate-related Financial Disclosures (TCFD) in 2021.
SASB: TITAN aligns its reporting on ESG performance with the
Sustainability Accounting Standard Board (SASB).
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1. Material Issues
TITAN Group Albania Bulgaria Egypt Greece
1
Future-ready business
model for a carbon neutral
world
Safe and healthy working
environment for our
employees and business
partners
Safe and healthy working
environment
Environmental and energy
management
Customer satisfaction with
sustainable, innovative and
quality products and
services
2
Safe and healthy working
environment
Employee engagement,
continuous development
and wellbeing
Customer relations Health and safety
Positive local social,
economic and
environmental net impact
3
Good governance,
transparency and business
ethics
Customer satisfaction
Employee development
and wellbeing
Competitiveness and
business model resilience
Health, safety and
wellbeing for our
employees
4
Diverse and inclusive
workplace
Good governance,
transparency, and business
ethics
Climate change mitigation
and adaptation
Good governance,
transparency, and
business ethics
Future-ready business
model in a carbon-neutral
word
5
Positive local social,
economic and
environmental impact
Supporting our local
communities well-being
Quality and sustainability
of products
Positive impact for our
communities
Good governance,
transparency and ethics
6
Innovation with emphasis on
digital and de-carbonization
Environmental
management
Efficient use of energy and
natural resources (water,
raw materials, and fuels)
Employee engagement
and development
Resource efficiency,
recycling and recovery,
contributing to a circular
economy
7
Continuous development of
our people
Responsible, reliable, and
sustainable supply chain
Good governance,
transparency and business
ethics
Innovation with emphasis
on digital and de-
carbonization
8
Reliable and sustainable
supply chain
Stakeholder relations and
engagement
Sustainability of
communities
Employee engagement
and continuous
development
9
Resource efficiency,
recycling and recovery,
contibuting to circular
economy
Climate change and energy
Responsible and reliable
supply chain
Reliable and sustainable
supply chain
10
Business model innovation Biodiversity conservation
Diverse and inclusive
workplace
11
Global Material Issues
Sectoral Material Issues
Local Material Issues
Level of Material Issues
ESG performance statements -
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Tables
Kosovo North Macedonia Serbia Turkey USA
Safe and healthy working
environment for our
employees and business
partners along the value
chain
Environmental management
of local impacts and
protection of natural
resources
Environmental protection
and investments
Health, safety and
wellbeing
Protect our people and
promote health and safety
Environmental performance
Safe and healthy working
environment for our
employees and business
partners
Safe and healthy working
environment
Marketing and customer
satisfaction (quality,
product innovation, and
safety)
Optimize and develop access
to raw materials, including
cement
Engaging and contributing to
our local communities
Building trust of our
customers and improve their
satisfaction
Employment
andemployeeswellbeing
Environmental
management
Attract, develop and
maintain talent in an open,
inclusive and diverse
culture
Good governance,
transparency, and business
ethics
Good governance and
business ethics
Economic performance and
market presence
Good governance,
compliance and business
ethics
Mitigate climate change
impacts and optimize
energy use
Employee engagement and
development
Continue engaging and
contributing to sustainability
of communities
Product quality and safety
Employee engagement,
collaboration and people
development
Innovation and quick
adaptation
Climate change and energy
efficiency
Decarbonization energy
efficiency, and business
model resilience
Stakeholder engagement and
welfare of communities
Climate change and
energy
Actively manage
biodiversity and
ecosystems (including
water)
Diverse and inclusive
workplace
Employee engagement,
development and well-being
Climate change and energy
Efficient use of resources
and contribution to a
circular economy
Community relations and
engagement; license to
operate
Responsible, reliable, and
sustainable supply chain
Maintaining a sustainable
and reliable supply chain
Good governance,
transparency, and business
ethics
Sustainable growth and
resilient infrastructure
Sustainability of concrete/
sustainability of our
products
Responsible and sustainable
supply chain
Responsible supply chain
management
Incoming regulation;
increasing regulation
complexity
Responsible use of resources
and contribution to acircular
economy, biodiversity, and
forestry
Social license to operatate
and contribution to local
communities' sustainability
Communication (internal
and external)
Digitalization
Brand reputation and
exposure through social
media
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Notes
The first column of the Table above provides the order of prioritization of the material issues for TITAN, and same holds for the order of material issues in each column for the separate BUs, according to the
outcomes of the materiality assessment of the last cycle in 2020 and 2021.
About definitions:
The boundaries of reporting for each material issue are defined by the principles of “materiality”, “relevance”, “conciseness”, “consistency”, and “connectivity” aligned with the guidance of the International
Integrated Reporting Council (IIRC)
1
:
Materiality
A matter is material if it is of such relevance and importance
2
that it could substantively influence the assessments of providers of financial capital with regard to the organization’s ability to create value over the
short, medium and long term. In determining whether or not a matter is material, senior management and those charged with governance should consider whether the matter substantively affects, or has the
potential to substantively affect, the organization’s strategy, its business model, or one or more of the capitals it uses or affects.
Relevance
Relevant matters are past, present or future matters that impact or may impact the organization’s strategy, its business model or one or more of the capitals and thus ultimately affect the organization’s ability to
create value over time. Identifying relevant matters for inclusion in the integrated report includes identifying the population of potentially relevant matters and narrowing these down to matters that are relevant
for inclusion in the integrated report. Information about relevant matters will have either, or both, predictive value or confirmatory value with respect to intended users’ decisions.
Conciseness
Disclosures about material matters should include concise information that provides sufficient context to make the disclosures understandable and should avoid information that is redundant in nature.
Consistency and comparability
Reporting policies should be followed consistently from one period to the next unless a change is needed to improve the quality of information reported. This includes using the same KPIs to report on the same
matters if they continue to be material across reporting periods. When a significant change has been made, the organization explains the reason for the change, describing (and quantifying if practicable and
material) its impact. Comparability of reported information is intended to enable comparison with other organizations to the extent it is material to the organization’s own ability to create value over time.
Connectivity
Connectivity is intended to address the connection between financial and non-financial information, in order to provide a holistic view of the combination, interrelatedness and dependencies between all the
factors that affect the organization’s ability to create value over time.
1. Sources: ‘Materiality Background Paper for <IR>’ (IIRC, 2013), and ‘The International <IR> Framework’ (IIRC 2013). Further information about the IIRC can be found on its website www.theiirc.org.
2. TITAN uses the equivalent term "significance".
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2. ESG Key Performance Indicators (KPIs)
2.1 Focus area: De-carbonization and Digitalization
code ESG Performance Indicators Unit 2021 2020 2019 2018 2017
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
2.1.1 Material Issue: Future-ready business model in a carbon neutral world
Cement and cementitious production activities
1.1
Scope 1 gross CO
2
emissions
2
million t
1
10.5 9.9 10.3 11.1 12.1
ƔƔƔƔƔ
EM-CM-110a.1 SDG 9.4
1.2
Greece
1
million t
2.9 2.5 3.0 3.0 3.2 ƔƔƔƔ
1.3
USA
1
million t
2.2 2.2 2.2 2.1 2.1 ƔƔƔƔ
1.4
Southeastern Europe
1
million t
2.6 2.5 2.5 2.5 2.6 ƔƔƔƔ
1.5
Eastern Mediterranean
1
million t
2.8 2.8 2.6 3.5 4.1 ƔƔƔƔ
1.6
Scope 1 gross CO
2
emissions covered under
limiting regulations
%
51.2 49.9 55.1 56.9 58.6 ƔƔ
EM-CM-110a.1
1.7
Scope 1 gross CO
2
emissions coverage rate
1
% Clinker
production
100.0 100.0 100.0 100.0 100.0
1.8
Scope 1 net CO
2
emissions
million t
10.1 9.6 10.0 10.8 11.9
ƔƔƔƔƔ
1.9
Greece
1
million t
2.7 2.3 2.8 2.8 3.1 ƔƔƔƔ
1.10
USA
1
million t
2.2 2.2 2.2 2.1 2.1 ƔƔƔƔ
1.11
Southeastern Europe
1
million t
2.5 2.4 2.5 2.5 2.6 ƔƔƔƔ
1.12
Eastern Mediterranean
1
million t
2.7 2.7 2.5 3.4 4.1 ƔƔƔƔ
1.13
Scope 1 net CO
2
emissions coverage rate
1
% Clinker
production
100.0 100.0 100.0 100.0 100.0
1.14
Scope 1 specific gross CO
2
emissions
kg/t
Cementitious
Product
681.90 697.92 701.12 708.80 716.59 ƔƔƔƔ
1.15
Scope 1 specific net CO
2
emissions
kg/t
Cementitious
Product
654.20 673.99 676.56 686.08 700.25 ƔƔƔƔ
1.16
Avoided Scope 1 net CO
2
emissions
3
million t
31.2 29.3 27.8 26.3 24.9 ƔƔƔ
1.17
Scope 2 CO
2
emissions
4,5
million t
0.8 0.9 0.9 1.0 1.2
ƔƔƔƔƔ
1.18
Greece
1
million t
0.2 0.3 0.3 0.3 0.5 ƔƔƔƔ
1.19
USA
1
million t
0.1 0.1 0.1 0.1 0.2 ƔƔƔƔ
1.20
Southeastern Europe
1
million t
0.2 0.3 0.3 0.3 0.3 ƔƔƔƔ
1.21
Eastern Mediterranean
1
million t
0.2 0.2 0.2 0.3 0.3 ƔƔƔƔ
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code ESG Performance Indicators Unit 2021 2020 2019 2018 2017
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
1.22
Scope 2 CO
2
emissions coverage rate
1
% Clinker
production
100.0 100.0 100.0 100.0 100.0
1.23
Scope 2 specific CO
2
emissions
1
kg/t
Cementitious
Product
51.50 61.00 62.18 63.99 72.74 ƔƔƔ
1
1
.
.
2
24
Scope 3 CO
2
emissions
1,6,7
million t
1.6 n/a n/a n/a n/a
ƔƔƔ
1.25
Category 1 - Purchased goods and services
1,7
million t
0.4 n/a n/a n/a n/a ƔƔƔ
1.26
Category 3 - Fuel and energy related activities
1,7
million t
0.7 n/a n/a n/a n/a ƔƔƔ
1.27
Category 4 - Upstream transportation and
distribution
1,7
million t
0.1 n/a n/a n/a n/a ƔƔƔ
1.28
Category 6 - Business travels
1,7
million t
0.0 n/a n/a n/a n/a ƔƔƔ
1.29
Category 7 - Employee commuting
1,7
million t
0.0 n/a n/a n/a n/a ƔƔƔ
1.30
Category 9 - Downstreamtransportation and
distribution
1,7
million t
0.3 n/a n/a n/a n/a ƔƔƔ
Scope 3 CO
2
emissions per region
1.31
Greece
1,7
million t
0.4 n/a n/a n/a n/a ƔƔ
1.32
USA
1,7
million t
0.2 n/a n/a n/a n/a ƔƔ
1.33
Southeastern Europe
1,7
million t
0.4 n/a n/a n/a n/a ƔƔ
1.34
Eastern Mediterranean
1,7
million t
0.5 n/a n/a n/a n/a ƔƔ
1.35
Scope 3 CO
2
emissions coverage rate
1,7
% Clinker
production
100.0 n/a n/a n/a n/a
1.36
Scope 3 specific CO
2
emissions
1,7
kg/t
Cementitious
Product
103.40 116.80 n/a n/a n/a ƔƔƔ
1.37 Conventional fossil fuels substitution rate
% Heat
84.5 86.9 86.5 88.0 91.1 ƔƔƔƔƔ
1.38 Alternative fuel substitution rate
% Heat
15.5 13.1 13.5 12.0 8.9 ƔƔƔƔƔ
EM-CM-130a.1
1.39
Biomass in fuel mix
8
% Heat
4.8 3.8 4.3 3.4 2.8 ƔƔƔƔƔ
EM-CM-130a.1
SDG 9.4
105
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
code ESG Performance Indicators Unit 2021 2020 2019 2018 2017
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
1.40
Fuel mix, energy consumption for clinker and
cement production
% Heat
100.0 100.0 100.0 100.0 100.0 ƔƔ
1.41 Conventional fossil fuels
% Heat
8
84.5 86.9 86.5 88.0 91.1
ƔƔ
1.42 Coal, anthracite, and waste coal
% Heat
44.7 33.0 42.8 32.6 29.3 ƔƔ
1.43 Petroleum coke
% Heat
28.5 44.8 38.5 51.2 57.3 ƔƔ
1.44 Lignite
% Heat
1.2 1.7 1.6 1.0 1.6 ƔƔ
1.45 Other solid fossil fuel
% Heat
1.9 1.8 1.4 1.4 1.0 ƔƔ
1.46 Natural gas
% Heat
7.4 5.0 1.0 0.5 0.6 ƔƔ
1.47 Heavy fuel (ultra)
% Heat
0.3 0.3 0.6 0.8 0.7 ƔƔ
1.48 Diesel oil
% Heat
0.4 0.4 0.6 0.5 0.6 ƔƔ
1.49 Gasoline, LPG (Liquified petroleum gas or liquid pr
o
% Heat
0.1 0.0 0.1 0.1 0.1 ƔƔ
1.50 Alternative fossil and mixed fuels
% Heat
15.5 13.0 13.1 11.5 8.3
ƔƔƔƔ
1.51 Tyres
% Heat
2.9 3.0 3.1 2.8 2.1 ƔƔƔƔ
1.52 RDF
% Heat
5.6 3.6 3.9 1.7 0.8 ƔƔƔƔ
1.53 Impregnated saw dust
% Heat
0.7 0.8 0.7 0.7 0.5 ƔƔƔƔ
1.54 Mixed industrial waste
% Heat
1.5 1.2 1.4 1.8 1.0 ƔƔƔƔ
1.55 Other fossil based and mixed wastes (solid)
% Heat
4.7 4.4 4.0 4.5 3.9 ƔƔƔƔ
1.56 Biomass fuels
% Heat
0.1 0.1 0.4 0.5 0.6
ƔƔƔƔ
1.57 Dried sewage sludge
% Heat
0.0 0.0 0.0 0.0 0.1 ƔƔƔƔ
1.58 Wood, non-impregnated saw dust
% Heat
0.0 0.0 0.3 0.4 0.5 ƔƔƔƔ
1.59 Agricultural, organic, diaper waste, charcoal
% Heat
0.0 0.0 0.0 0.0 0.0 ƔƔƔƔ
1.60 Other
% Heat
0.0 0.0 0.0 0.0 0.1 ƔƔƔƔ
1.61 Alternative fuels consumption (total)
t
335,700 234,451 269,665 244,395 203,170 ƔƔƔƔ
EM-CM-130a.1
1.62 Clinker to cement ratio
%
81.66 82.44 82.87 83.68 83.78 ƔƔƔ
1.63
Lower carbon products as part of our cement
production
1,7,9
% Cement
production
45.4 41.3 n/a n/a n/a Ɣ
2.1.2 Material issue: Innovation with emphasis on digitalization and de-carbonization
All Activities
1.64
Annual investment in Research and Innovation
7,10
million €
10.74 10.50 7.90 5.80 n/a Ɣ
SDG 13.2
SDG 7.2
SDG12.2
SDG 13.1
106
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Notes
General Note for the consolidation of data
Consolidation (aggregation) of data for the above ESG performance indicators related to the Material Issues
• “Future-ready business model in a carbon neutral world” was made on the basis of the percentage of property share for each of the subsidiaries, where TITAN holds a property share of more than 50.0%, also called share of equity for
the purposes of non-financial data consolidation. The indicators were calculated according to the share of equity held by the Group at the end of 2021. Performance of previous years was recalculated to reflect changes in share of equity
in 2021, if required. A detailed list of TITAN Group subsidiaries and TITAN’s share of equity is provided in the Table 2.5.8 “TITAN Group Basis for Calculating Environmental Performance Indicators, using the Share of equity”, in this
section of ESG performance statements.
• “Innovation with emphasis on digitalization and de-carbonization” was made with 100.0% contribution for all subsidiaries, where TITAN holds percentage of property share of more than 50.0%.
Notes for the external verification, standards, guidance, and terms used
Assurance: Specific KPIs denoted in this Table are included in the scope of ERM Certification and Verification Services (ERM CVS) assurance engagement (ERM CVS’ “Independent assurance statement”).
Standards: For the reporting standards under TITAN's Global Sectoral Approach, namely the GCCA, UNGC, UNCTAD, TCFD, and SASB, please refer to the section “TITAN’s approach for ESG Performance reporting” in the ESG performance
statements.
Guidance: TITAN follows the GCCA Sustainability Framework Guidelines, and the Sustainability Guidelines for the monitoring and reporting of CO₂ emissions from cement manufacturing, and coprocessing fuels and raw materials. The
above Guidelines had superseded before 2021 the previous – and respective – Guidelines of the WBCSD/CSI, which were the guidance for measuring, reporting and verifying environmental performance until (and including) year 2018. For
the Sector standards, see details in Table 2.5.9 “Sector Standards for the Non-financial disclosures in 2021”.
Notes on specific KPIs
1. New indicator.
2. Direct CO₂ emissions related to the operation of TITAN’s cement production facilities.
3. Avoided CO
2
emissions is the total accumulated quantity for the period between the specific year and the base year which in the case of CO
2
emissions is 1990 in accordance to the Kyoto protocol. The base year performance for
specific net Scope 1 CO
2
emissions was 778.3kg/tCementitious product, adjusted for the equity of year 2021.
4. Indirect CO₂ emissions related to emissions released for the production of the electrical energy consumed at TITAN’s cement production facilities. For their calculation, we use emission factors provided by the supplier of the
electrical energy or other publicly available data sources.
5. 2020 figures adjusted based on updated information received after the publication of 2020 IAR.
6. Indirect CO₂ emissions related to the emissions of the supply chain.
7. Relevant information is not available for the specific years denoted as 'n/a'.
8. Biomass rate corresponds to the percentage of total thermal energy consumption that comes from renewable energy sources.
9. Lower carbon products refer to produced cement types with a carbon footprint that is at least 10.0% lower than that of a typical OPC type as well as any cementitious product sold to be used as cement or concrete additive.
10. For the definition of KPI "Annual investment in Research and Innovation" see the section 2.5.10 “Notes for Value Creation Indicators”.
Notes for connection of KPIs with the SASB Standards
Connection of ESG performance indicators with metrics according to SASB Standards, in specific:
- EM-CM-110a.1 under the area “Greenhouse Gas Emissions” for Gross global Scope 1 emissions, percentage covered under emissions-limiting regulations. Also the connection with the EM-CM-110a.2 is provided by the disclosures under
the section 'Understanding TITAN', in specific see: 'Making progress towards our ESG Targets', and 'Climate-related financial disclosures (TCFD)'.
- EM-CM-130a.1 under the area “Energy Management” for total energy consumed, percentage grid electricity, percentage alternative, and percentage renewable.
107
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
2.2 Focus area: Growth-enabling work environment
code ESG Performance Indicators Unit 2021 2020 2019 2018 2017
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
2.2.1 Material issue: Safe and healthy working environment
2.1 Employee fatalities
#
01000ƔƔƔƔ
2.2 Employee fatality rate
#/10
4
persons
0.00 1.85 0.00 0.00 0.00 ƔƔƔƔ
2.3 Contractors fatalities
#
02020ƔƔƔƔ
2.4 Third-party fatalities
#
00000ƔƔƔƔ
2.5 Employee Lost Time Injuries (LTIs)
#
10 6 16 17 27 ƔƔƔƔ
2.6
Employee Lost Time Injuries Frequency Rate
(LTIFR)
#/10
6
h
0.91 0.57 1.44 1.54 2.41 ƔƔƔƔ
EM-CM-320a.1
2.7
Employee lost working days
1
d
417 256 637 615 1,220 ƔƔƔ
2.8
Employee Lost Time Injuries Severity Rate
1
d/10
6
h
38.1 24.1 57.4 55.7 109.0 ƔƔƔƔ
2.9 Contractors Lost Time Injuries (LTIs)
#
11 10 10 9 7 ƔƔƔƔ
2.10
Contractors Lost Time Injuries Frequency Rate
(LTIFR)
#/10
6
h
1.55 1.46 1.35 1.12 0.82 ƔƔƔƔ
EM-CM-320a.1
2.11 Near misses
#
3,603 3,467 3,746 2,169 1,185 Ɣ
EM-CM-320a.1
2.12
Training man-hours on health and safety per
employee
2
h/person
9.53 6.88 14.10 12.98 12.32 ƔƔ
2.13
Training man-hours on health and safety per
contractor
2
h/person
10.83 10.40 12.34 14.88 11.73 ƔƔ
2.14
Expenditures for Health and Safety, Group
Total
3,6
€
6,532,210 8,501,138 n/a n/a n/a ƔƔ
2.15 Employee fatalities
#
00000ƔƔƔƔ
2.16 Employee fatality rate
#/10
4
persons
0.00 0.00 0.00 0.00 0.00 ƔƔƔƔ
2.17 Contractors fatalities
#
02020ƔƔƔƔ
2.18 Third-party fatalities
#
00000ƔƔƔƔ
2.19 Employee Lost Time Injuries (LTIs)
#
7 2 10 8 16 ƔƔƔƔ
2.20 Employee Lost Time Injuries Frequency Rate (LTIF
#/10
6
h
1.11 0.33 1.59 1.25 2.41 ƔƔƔƔ
EM-CM-320a.1
2.21 Employee lost working days
d
283 176 440 416 1,014 ƔƔƔ
2.22 Employee Lost Time Injuries Severity Rate
d/10
6
h
44.9 29.2 69.9 65.0 152.8 ƔƔƔƔ
2.23 Contractors Lost Time Injuries (LTIs)
#
88866ƔƔƔƔ
2.24
Wellbeing initiatives for employees, Group total
for all activities
3,6
#
118 43 n/a n/a n/a
SDG 3.6
SDG 3.8
SDG 4.3
SDG 8.8
All activities
All activities
Cement production activities
SDG 3.6
SDG 3.8
SDG 4.3
SDG 8.8
SDG 3.6
SDG 3.8
SDG 4.3
SDG 8.8
108
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Code ESG Performance Indicators Unit Greece and
Western Europe
USA SEE EM
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
2021 Performance by region
2.25 Employee fatalities
#
0000ƔƔƔ
2.26 Employee fatality rate
#/10
4
persons
0.00 0.00 0.00 0.00 ƔƔƔ
2.27 Contractors fatalities
#
0000ƔƔƔ
2.28 Third-party fatalities
#
0000ƔƔƔ
2.29 Employee Lost Time Injuries (LTIs)
#
0253ƔƔƔ
2.30
Employee Lost Time Injuries Frequency Rate
(LTIFR)
#/10
6
h
0.00 0.38 2.43 2.17 ƔƔƔ
EM-CM-320a.1
2.31 Employee lost working days
d
05734416ƔƔ
2.32 Employee Lost Time Injuries Severity Rate
d/10
6
h
0.00 10.75 167.16 11.57 ƔƔƔ
2.33 Contractors Lost Time Injuries (LTIs)
#
4043ƔƔƔ
2.34
Contractors Lost Time Injuries Frequency
Rate (LTIFR)
#/10
6
h
2.50 0.00 2.30 0.86 ƔƔƔ
EM-CM-320a.1
2021 Performance by activity C
Cement Aggregates Ready Mix Other
2.35 Employee fatalities
#
0000ƔƔƔ
2.36 Employee fatality rate
#/10
4
persons
0.00 0.00 0.00 0.00 ƔƔƔ
2.37 Contractor fatalities
#
0000ƔƔƔ
2.38 Third-party fatalities
#
0000ƔƔƔ
2.39 Employee Lost Time Injuries (LTIs)
#
7030ƔƔƔ
2.40
Employee Lost Time Injuries Frequency Rate
(LTIFR)
#/10
6
h
1.11 0.00 0.90 0.00 ƔƔƔ
EM-CM-320a.1
2.41 Employee lost working days
d
283 0 134 0 ƔƔ
2.42 Employee Lost Time Injuries Severity Rate
d/10
6
h
44.9 0.0 40.1 0.0 ƔƔƔ
2.43 Contractors Lost Time Injuries (LTIs)
#
8120ƔƔƔ
2.44
Contractors Lost Time Injuries Frequency
Rate (LTIFR)
#/10
6
h
1.34 2.37 3.64 0.00 ƔƔƔ
EM-CM-320a.1
SDG 3.6
SDG 3.8
SDG 4.3
SDG 8.6
SDG 8.8
SDG 10.3
SDG 3.6
SDG 3.8
SDG 4.3
SDG 8.6
SDG 8.8
SDG 10.3
109
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TITAN CEMENT GROUP
code ESG Performance Indicators Unit 2021 2020 2019 2018 2017
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
2.2.2 Material issue: Diverse and Inclusive workplace
2.45
Average employment, Group total
4
# 5,352 5,363 5,382 5,424 5,552 Ɣ
2.46
Number of employees as of 31 December 2020,
Group total
# 5,358 5,359 5,400 5,365 5,432 Ɣ
2.47
Employee turnover per gender, Group average
3
%
10.62 11.31 12.33 11.03 13.94
Ɣ
2.48
Females
%
9.08 10.41 11.11 14.20 14.70
2.49
Males
%
10.86 11.48 12.50 10.47 13.49
2.50
Under 30
% 31.84 26.80 28.61 n/a n/a
2.51
Between 30-50
% 10.82 9.86 10.67 n/a n/a
2.52
Over 50
% 6.83 10.68 11.61 n/a n/a
2.53
Employees left, Group total
5
# 569 606 666 592 757
Ɣ
2.54
Under 30
# 121 97 111 119 108
2.55
Between 30-50
# 293 277 309 281 316
2.56
Over 50
# 155 234 246 192 333
2.57
Females
#6569739196
2.58
Males
# 504 539 593 501 661
2.59
Employee new hires, Group average
5
% 15.47 10.73 14.24 10.27 13.02
Ɣ
2.60
Employee new hires, Group total
5
# 829 575 769 551 707
Ɣ
2.61
Females
# 143 77 119 77 123
Ɣ
2.62
Males
# 686 498 650 474 584
Ɣ
2.63
Under 30
# 241 140 204 157 200
Ɣ
2.64
Between 30-50
# 415 330 417 294 367
Ɣ
2.65
Over 50
# 173 105 148 100 140
Ɣ
2.66
Full time
# 5,247 5,231 5,297 5,342 5,461
Ɣ
2.67
Part Time
#3048422835
Ɣ
2.68
Temporary
#8180615456
Ɣ
SDG 5.4
SDG 8.5
SDG 8.6
SDG 8.8
SDG 10.3
Employee turnover per age group
3,5,6
Employees left per age group
3
Employees left per gender
3
New hires per age group
5
Employment per type
5
Employee new hires per gender
5
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Code ESG Performance Indicators Unit 2021 2020 2019 2018 2017
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
2.69
Managers
# 657 649 641 481 473
Ɣ
2.70
Senior managers
# 116 121 114 121 126
Ɣ
2.71
Administration/technical
# 1,514 1,459 1,460 1,616 1,654
Ɣ
2.72
Semi skilled/unskilled
# 3,071 3,130 3,185 3,214 3,294
Ɣ
2.69 Females # 716 663 657 641 653 Ɣ
2.70 Males # 4,642 4,696 4,743 4,783 4,899 Ɣ
2.71
Share of women in employment, Group average
5
% 13.36 12.37 12.17 11.82 11.76 Ɣ
2.72
Share of women in management, Group average
5
% 17.59 16.49 15.50 16.53 15.69 ƔƔ
2.73
Share of women in Senior Management, Group
average
5
% 14.66 14.05 14.91 19.01 16.67 ƔƔ
2.2.3 Material issue: Continuous development of our people
2.74
Training investment per (trained) employee,
Group average
3,5
€ 205 105 202 205 157 Ɣ
Ɣ
2.75
Training investment, Group total
3
€ 962,196 485,331 900,495
1,035,398
871,992 Ɣ
Ɣ
Training investment per gender, Group total
3,5
`
`
2.76 Females € 239,806 112,819 209,268 187,153 191,633 Ɣ
Ɣ
2.77 Males € 722,390 372,512 691,659 848,245 680,359 Ɣ
Ɣ
2.78
Trained employees, Group total
5
# 4,693 4,606 4,465 5,064 4,717 Ɣ
2.79
Share of trained employees (in total workforce),
Group average
5
% 87.59 85.95 82.69 93.36 84.96 Ɣ
2.80
Share of trained female employees (i
n total
female employees). Group average
5
% 96.79 93.21 95.13 97.50 94.03 Ɣ
Trained employees per category, Group total
5
2.81 Managers # 689 651 538 643 595
2.82 Senior Managers # 113 106 133 142 178
2.83 Administration/technical # 1,520 1,408 1,824 2,007 1,852
2.84 Semi skilled/Unskilled # 2,371 2,441 1,970 2,272 2,092
Employment per gender
5
SDG 4.3
SDG 4.4
SDG 5.1
SDG 5.5
SDG 8.5
SDG 10.2
SDG 10.3
SDG 16.5
Employment per category
5
SDG 5.4
SDG 8.5
SDG 8.6
SDG 8.8
SDG 10.3
111
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
Code ESG Performance Indicators Unit 2021 2020 2019 2018 2017
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
Trained employees per age group, Group total
2.85
Under 30 #
357 318 461 510 444
Ɣ
2.86
Between 30-50 #
2603 2631 2644 2982 2725
Ɣ
2.87
Over 50 #
1733 1657 1360 1572 1548
Ɣ
2.88 Training hours, Group total # 109,364 79,350 137,272 138,114 155,587 ƔƔƔ
2.89
Average training hours per employee (over the
total number of direct employees), and
breakdown per gender, Group total
5
# 20.41 14.81 25.42 25.46 28.02 ƔƔ
2.90 Average female # 25.68 18.06 35.32 35.66 37.00 Ɣ
2.91 Average male # 19.60 14.35 24.05 24.10 27.00 Ɣ
Training hours per subject, Group total
Ɣ
2.92
Company on-boarding
3,6
# 2,651 942 6,414 n/a n/a Ɣ
2.93 Compliance # 8,974 6,359 1,191 1,430 308 ƔƔ
2.94 CSR and Sustainability # 554 525 970 955 211 ƔƔ
2.95
Digital
3,6
# 9,718 2,767 11,767 n/a n/a Ɣ
2.96 Environment # 3,186 2,115 3,722 3,136 4,801 Ɣ
2.97 Foreign languages # 3,692 2,837 3,113 3,929 6,772 Ɣ
2.98 Functional competence # 7,856 4,994 3,512 Ɣ
2.99 Generic competence # 4,711 2,947 6,302 Ɣ
2.100 Health and safety # 50,992 36,912 76,372 69,591 68,200 Ɣ
2.101 Managerial skills # 4,243 3,615 10,297 15,223 19,883 Ɣ
2.102 Other # 1,738 3,620 1,276 2,440 4,716 Ɣ
2.103 Security # 136 586 407 761 754 Ɣ
2.104 Technical know-how # 10,916 11,132 11,931 17,497 22,217 Ɣ
2.105
Share of employees with performance evaluation,
Group average
3
% 60.66 58.70 58.80 48.60 48.20
2.106
Share of female employees with performance
evaluation, Group average
3,6
% 83.38 82.05 n/a n/a n/a
2.107
Share of female employees in talent pools, Group
average
3,6
% 13.90 13.00 n/a n/a n/a
SDG 4.3
SDG 4.4
SDG 5.1
SDG 5.5
SDG 8.5
SDG 10.2
SDG 10.3
SDG 16.5
23,152 27,725
112
MANAGEMENT REPORT
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Notes
General Note for the consolidation of data
Consolidation (aggregation) of data for the above ESG performance indicators was made with 100.0% contribution for all subsidiaries, where TITAN holds percentage of property share of more than 50.0%, also
called share of equity for the purposes of ESG performance statements data consolidation. A detailed list of TITAN Group subsidiaries and TITAN’s share of equity is provided in the Table TITAN 2.5.8 "Group Basis
for Calculating Environmental Performance Indicators", using the Share of equity, in this section of ESG performance statements.
Notes for the external verification, standards, guidance, and terms used
Assurance: Specific KPIs denoted in this Table are included in the scope of ERM Certification and Verification Services (ERM CVS) assurance engagement (ERM CVS’ “Independent assurance statement”).
Standards: For the reporting standards under TITAN's Global Sectoral Approach, namely the GCCA, UNGC, UNCTAD, TCFD, and SASB, please refer to the section ‘TITAN’s approach for ESG Performance reporting’
in the ESG performance statements.
Guidance: TITAN follows the GCCA Sustainability Framework Guidelines, and the Sustainability Guidelines for the monitoring and reporting of safety in cement and concrete manufacturing (last edition in
February 2020). This document has been agreed within the GCCA to have extended application to concrete and other related activities.
Notes on specific KPIs
1. Figure for 2020 was adjusted to include previously unreported data,
2. The KPI was calculated for closing of the reporting period 2020 in accordance with the practice for all Safety data, being the use of "Average Employment" (see Note 3 below). This is consistent with all years
prior to 2021.
3. New KPIs and other notes:
• “Wellbeing initiatives” was introduced in this report for providing the total number of initiatives of TITAN BUs which aim to support employees on all dimensions of the TITAN Health and Wellbeing framework
(the four dimensions are: physical, mental, social, and financial), in a holistic and integrated way. In 2021 all BUs have increased efforts for achieving coverage of the dimensions of TITAN’s Framework, and 8
countries covered all four dimensions, while one country covered three out of four. The KPI aims to strengthen our reporting on performance for the Material Issue Safe and healthy working environment, under
the Focus Area Growth-enabling work environment.
• “Employee turnover per gender” (females and males), “Employee turnover per age group” (under 30, between 30-50, and over 50), “Employees left per age group”, and “Employees left per gender”, were
introduced for the first time in this report, to enlarge the coverage of TITAN’s disclosures on performance related to the Material Issue Material Issue Diverse and Inclusive workplace.
• Also new KPIs were introduced for TITAN’s discloser of performance related to the Material Issue Continuous development of our people, in specific: “Share of employees with performance evaluation”, “Share
of female employees with performance evaluation”, and “Share of female employees in talent pools”. TITAN follows an inclusive approach for increasing the coverage of employees under the performance
evaluation programs on each BU level and engages employees from all categories or employment (managers and senior managers, administration/technical, and employees in the category semi-skilled/unskilled).
• Last, for the definition of KPI "Training Investment" see the section 2.5.10 “Notes for Value Creation Indicators”.
4. The calculation of the KPI "Average Employment" was made according to Belgian Law (sec. 165 XIVB of RD of 30 January 2001).
5. Other notes KPIs calculated on the basis of "Average Employment" data for years 2017-2018. As of 2019, the specific KPIs are calculated on the basis of the number of employees as of 31 December. Figures for
the KPI "Share of trained female employees (in total female employees)" which were calculated above 100% (because of the Turnover for Females, or other reasons) needed to be reported as 100%.
The total hours of training under the subject area “Environment” cover also the hours of training for the topics related to "Decarbonization" which was introduced as a new subject area in the last quarter of 2021
and accounted for insignificant in the total hours of training on Group level.
The figures of KPIs for year 2020, related to "Employee new hires" and "Employees left", were amended in order to meet the requirements of TITAN standards and the in-house system for data analytics.
6. Relevant information is not available for the specific years denoted as 'n/a'.
Notes for connection of KPIs with the SASB Standards
Connection of ESG performance indicators with the metric EM-CM-320a.1 according to SASB Standards, under the area “Workforce Health and Safety”, and in specific for the near misses and frequency rate for full
-
time employees, and contract employees.
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2.3 Focus area: Positive local impact
Code ESG Performance Indicators Unit 2021 2020 2019 2018 2017
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
2.3.1 Material issue: Environmental positive impact
3.1 Overall coverage rate
%
72.0 65.4 74.1 79.8 78.1 ƔƔƔ
EM-CM-120a.1
3.2 Coverage rate continuous measurement
%
77.8 77.7 78.6 81.0 82.1 ƔƔƔ
EM-CM-120a.1
3.3 Dust emissions (total)
t
206.9 225.4 177.5 155.9 277.9 ƔƔƔ
EM-CM-120a.1
3.4 Specific dust emissions
g/t clinker
16.6 19.3 14.7 12.1 19.8 ƔƔƔ
EM-CM-120a.1
3.5 Coverage rate for dust emissions
%
100.0 100.0 100.0 100.0 100.0 ƔƔƔ
EM-CM-120a.1
3.6
Avoided dust emissions
1
t
65,132 60,700 56,600 52,310 47,680 ƔƔƔ
3.7 NOx emissions (total)
t
15,729.4 14,962.1 15,316.6 16,880.8 18,863.1 ƔƔƔ
EM-CM-120a.1
3.8 Specific NOx emissions
g/t clinker
1,263.4 1,282.4 1,268.6 1,307.0 1,345.3 ƔƔƔ
EM-CM-120a.1
3.9 Coverage rate for NOx emissions
%
100.0 100.0 100.0 100.0 100.0 ƔƔƔ
EM-CM-120a.1
3.10
Avoided NOx emissions
1
t
282,474 261,235 241,555 221,025 199,555 ƔƔƔ
3.11 SOx emissions (total)
t
3,050.9 2,953.0 2,334.9 2,632.4 2,738.4 ƔƔƔ
EM-CM-120a.1
3.12 Specific SOx emissions
g/t clinker
245.0 253.1 193.4 203.8 195.3 ƔƔƔ
EM-CM-120a.1
3.13 Coverage rate for SOx emissions
%
100.0 100.0 100.0 100.0 100.0 ƔƔƔ
EM-CM-120a.1
3.14
Avoided SOx emissions
1
t
39,664.7 37,290.0 35,350.0 32,630.0 29,855.0 ƔƔƔ
3.15 TOC emissions (total)
t
492.6 435.3 682.2 546.9 710.7 ƔƔ
EM-CM-120a.1
3.16 Specific TOC emissions
g/t clinker
39.6 37.3 56.5 42.3 50.7 ƔƔ
EM-CM-120a.1
3.17 Coverage rate for TOC emissions
%
96.4 90.9 98.9 100.0 100.0 ƔƔ
EM-CM-120a.1
3.18 PCDD/F emissions (total)
mg
339.4 211.3 152.5 227.7 343.4 ƔƔ
EM-CM-120a.1
3.19 Specific PCDD/F emissions
ng/t clinker
27.3 18.1 12.6 17.6 24.5 ƔƔ
EM-CM-120a.1
3.20 Coverage rate for PCDD/F emissions
%
83.3 96.8 100.0 100.0 89.3 ƔƔ
EM-CM-120a.1
3.21 Hg emissions (total)
kg
279.6 360.3 494.5 492.8 478.0 ƔƔ
EM-CM-120a.1
3.22 Specific Hg emissions
m
g/t clinker
22.5 30.9 41.0 38.2 34.1 ƔƔ
EM-CM-120a.1
3.23 Coverage rate for Hg emissions
%
94.5 100.0 97.0 100.0 96.0 ƔƔ
EM-CM-120a.1
3.24 Cd and Tl emissions (total)
kg
181.8 166.5 221.3 267.2 241.3 ƔƔ
EM-CM-120a.1
3.25 Specific (Cd and Tl) emissions
m
g/t clinker
14.6 14.3 18.3 20.7 17.2 ƔƔ
EM-CM-120a.1
3.26 Coverage rate for (Cd and Tl) emissions
%
72.0 77.7 75.1 81.0 78.1 ƔƔ
EM-CM-120a.1
3.27 Sb, As, Pb, Cr, Co, Cu, Mn, Ni and V emissions (total)
kg
2546.7 2,092.6 2,101.1 2,479.6 3,758.1 ƔƔ
EM-CM-120a.1
3.28 Specific (Sb, As, Pb, Cr, Co, Cu, Mn, Ni and V)
m
g/t clinker
204.6 179.36 174.03 191.99 268.03 ƔƔ
EM-CM-120a.1
3.29
Coverage rate for (Sb, As, Pb, Cr, Co, Cu, Mn, Ni and
V) emissions
%
72.0 77.7 75.1 81.0 78.1 ƔƔ
EM-CM-120a.1
3.30
Integrated cement plants and cement grinding plants
with certified Environmental Management System
(ISO 14001 or similar)
% of plants
86.7 86.7 86.7 86.7 86.7 Ɣ
Cement production activities
Air emissions
SDG 3.9
SDG 9.4
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Code ESG Performance Indicators Unit 2021 2020 2019 2018 2017
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
3.31
Environmental complaints
2,3
#
13 2 10 n/a n/a
3.32
Greece
2,3
#
6 2 8 n/a n/a
3.33
USA
2,3
#
0 0 0 n/a n/a
3.34
Southeastern Europe
2,3
#
6 0 1 n/a n/a
3.35
Eastern Mediterranean
2,3
#
1 0 1 n/a n/a
3.36
Sites with rehabilitation plans
4,7
%
91.0 91.0 94.0 78.0 83.0 ƔƔƔ
EM-CM-160a.1
3.37
Sites rehabilitated areas over affected areas
(cumulative)
3,4,7,8
%
22.6 23.6 n/a n/a n/a Ɣ
EM-CM-160a.2
3.38
Sites with Environmental Management System
(ISO14001 or similar)
%
78.0 79.0 77.0 80.0 83.0 Ɣ
EM-CM-160a.1
3.39
Sites in high biodiversity value areas
4,5
#
12 10 10 10 10 ƔƔ
EM-CM-160a.1
3.40
Sites with biodiversity management plans
4,6
#
109998ƔƔ
EM-CM-160a.1
3.41 Sites with biodiversity management plans
%
83.3 90.0 90.0 90.0 80.0 ƔƔƔ
EM-CM-160a.1
Investments in environmental protection
All activities
3.42
Environmental expenditures across all activities
9
million €
25.3 22.2 26.6 29.1 27.6 ƔƔ
3.43 Environmental management
million €
16.7 13.9 16.8 16.3 15.8 ƔƔ
3.44 Reforestation
million €
0.5 0.3 0.5 0.5 0.5 ƔƔ
3.45 Rehabilitation
million €
0.8 0.7 0.6 0.5 0.5 ƔƔ
3.46 Environmental training and awareness building
million €
0.3 0.3 0.2 0.2 0.2 ƔƔ
3.47 Application of best available technologies
million €
4.8 4.2 6.4 9.6 8.7 ƔƔ
3.48 Waste management
million €
2.0 2.7 2.1 1.9 2.0 ƔƔ
SDG 15.3
SDG 15.4
SDG 15.9
SDG 15a
SDG 15.3
SDG 15.4
SDG 15.9
SDG 15a
SDG 7b
SDG 9.4
All activities
Rehabilitation
Cement production and aggregates activities
Biodiversity
Cement production and aggregates activities
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Code ESG Performance Indicators Unit 2021 2020 2019 2018 2017
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
2.3.2 Material issue: Social positive impact
3.49
Donations, Group total
10
€
2,310,864 2,125,725 2,532,248 2,263,920 2,083,370
ƔƔ
3.50
Donations in cash, Group total
10
€
1,836,286 1,560,093 2,020,330 1,626,390 1,498,483
ƔƔ
3.51
Donations in kind, Group total
10
€
474,578 565,633 511,918 637,530 584,887
ƔƔ
3.52
Employees from local community, Group average
11
%
83.31 83.16 83.32 80.79 80.00
3.53 Internships, Group total
#
391 251 396 477 910 Ɣ
3.54
New entry level jobs from internships/traineeships,
Group total
#
24 15 24 23 24 Ɣ
3.55
Internships from Local Community, Group total
2,3
% 83.38 95.62 58.84 61.22 n/a
3.56
Key operations with Community Engagement Plans
related to material issues and Group policies
2,3
# 15 of 15 14 of 14 6 of 14 3 of 14 n/a ƔƔƔ
3.57
Total number of Initiatives under Community
Engagement Plans, Group total
2,3
# 142 124 n/a n/a n/a
3.58
Total number of Participants to Community
Engagement Plans, Group total
2,3
# 2,750 3,633 n/a n/a n/a
3.59
TITAN Employees, volunteers to Community
Engagement Plans, Group total
2,3
# 1,873 n/a n/a n/a n/a
3.60
Total amount of “social investment” for the
implementation of the Community Engagement
Plans, Group total
2,3
million €
1.3 1.5 n/a n/a n/a
3.61
Blood donations (TITAN employees, business
partners and communities), Group total
2,3
# 579.0 n/a n/a n/a n/a
2.3.3 Material issue: Economic positive impact
3.62
Local Spend, Group average
3,10
% 65.12 66.95 65.35 n/a n/a ƔƔ
SDG 2.1
SDG 2.3
SDG 4.3
SDG 4.4
SDG 9.3
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Notes
General Note for the consolidation of data
Consolidation (aggregation) of data for the above ESG performance indicators related to the Material Issues
• “Environmental positive impact” was made on the basis of the percentage of property share for each of the subsidiaries, where TITAN holds a property share of more than 50.0%, also called share of equity for
the purposes of non-financial data consolidation. The indicators were calculated according to the share of equity held by the Group at the end of 2021. Performance of previous years was recalculated to reflect
changes in share of equity in 2021, if required. A detailed list of TITAN Group subsidiaries and TITAN’s share of equity is provided in the Table 2.5.8 “TITAN Group Basis for Calculating Environmental Performance
Indicators”, using the Share of equity, in this section of ESG performance statements.
• “Social positive impact” and “Economic positive impact” was made with 100.0% contribution for all subsidiaries, where TITAN holds percentage of property share of more than 50.0%.
Notes for the external verification, standards, guidance, and terms used
Assurance: Specific KPIs denoted in this Table are included in the scope of ERM Certification and Verification Services (ERM CVS) assurance engagement (ERM CVS’ “Independent assurance statement”).
Standards: For the reporting standards under TITAN's Global Sectoral Approach, namely the GCCA, UNGC, UNCTAD, TCFD, and SASB, please refer to the section “TITAN’s approach for ESG Performance reporting”
in the ESG performance statements.
Guidance: TITAN follows the GCCA Sustainability Framework Guidelines, and the Sustainability Guidelines for the monitoring and reporting of emissions from cement manufacturing, and quarry rehabilitation and
biodiversity management. The above Guidelines had superseded before 2021 the previous – and respective – Guidelines of the WBCSD/CSI, which were the guidance for measuring, reporting and verifying
environmental performance until (and including) year 2018. For the Sector standards, see details in Table 2.5.9 “Sector Standards for the Non-financial disclosures in 2021”.
Notes on specific KPIs
1. Avoided air emissions are the total accumulated quantities (for each specific emission separately) for the period between the specific year and the base year which in the case of air emissions is 2003, the year of
publishing the first sustainability report of TITAN Group. The base year performance for specific dust emissions was 370.3g/tClinker, for specific NOx emissions was 2,969.2g/tClinker and for specific SOx emissions
was 418.8g/tClinker, adjusted for the equity of year 2021.
2. New indicators. More details:
- “Internships from Local Community”, “Total number of Initiatives under Community Engagement Plans”, “Total number of Participants to Community Engagement Plans”, “TITAN Employees, volunteers to
Community Engagement Plans”, “Total amount of ‘social investment’ for the implementation of the Community Engagement Plans”, and “Blood donations (TITAN employees, business partners and communities)”
were introduced as new KPIs in this report for strengthening our disclosures on performance related to the Material Issue “Social positive impact”.
In more specific:
• The number of “Internships from Local Community” is calculated as % share of Interns (students or other) who are residents from the local communities, over the total number of Internships, as reported by the
KPI “Internships”.
• The KPIs of “Total number of Participants to Community Engagement Plans”, “TITAN Employees, volunteers to Community Engagement Plans”, and “Total amount of ‘social investment’ for the implementation
of the Community Engagement Plans” are related to the KPI "Key operations with Community Engagement Plans related to material issues and Group policies" which was incorporated for the first time in the ESG
performance statements in the TITAN IAR 2020. In 2021 TITAN progressed with the implementation of a new framework guidance for Community Engagement Plans across all BUs and strengthened its approach.
The discussion on performance in 2021 is provided in the Management report, section “ESG performance review”, for Material issue: “Social positive impact”. Few definitions for providing more clarity about
TITAN’s approach to stakeholders engagement in communities, are as follows:
o ”Inform” refers to: Provide (local) Stakeholders with info on the BU Materiality Assessment outcomes and the ESG targets, and assist in understanding problems, alternatives, and solutions, as well as exploring
opportunities for win-win collaborative initiatives.
o “Consult” refers to: Obtain Stakeholders feedback following the ‘Inform’ stage, and explore synergies of the BU with the local community.
o “Involve” refers to: Work directly with Stakeholders, and consider their concerns, aspirations, and expectations from the company (BU).
o “Collaborate” refers to: Listen to the input of Stakeholders as part the decision-making of the BU, following the previous 3 stages. Identify best option(s) for solutions, and agree on win-win opportunities for the
local community and the company. Plan for implementation jointly with Stakeholders, and agree on the adequate level of advocacy for your decisions and actions.
o “Empower” refers to: Stakeholders and the local community can make their decisions and plan for their actions, for leading (their) solution-based efforts. The company aims to be the ‘enabler’ or ‘facilitator’.
3. Relevant information is not available for the specific years denoted as 'n/a'.
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4. Coverage includes all wholly-owned quarries attached to cement plants and quarries for aggregates production.
5. Active quarries within, containing or adjacent to areas designated for their high biodiversity value. See also Table “TITAN Group Quarry Sites with High Biodiversity Value”.
6. Active quarries with high biodiversity value where biodiversity management plans are actively implemented. See also Table “TITAN Group Quarry Sites with High Biodiversity Value”.
7. Performance figures of previous years have been re-calculated and adjusted to reflect the revised baseline (scope) (see Note 2).
8. 2020 is the initial year for disclosing data for this indicator.
9. The definition of “Environmental expenditures across all activities” is equivalent to the definition of “Investment in the Environment”, see section 2.5.10 “Notes for Value Creation Indicators”.
10. For definitions related to "Donations", and "Local Spend", see section 2.5.10 “Notes for Value Creation Indicators” (see the equivalent definitions, respectively: “Total spend on donations and social engagement
initiatives”, and “% local spend of TITAN”).
11. Specific information is not available for the operations of TITAN in USA. The percentages for the Group Average are calculated excluding the employment of TITAN in USA. For specific method of calculation see
respective Note under the Table 2.2 “Growth-enabling work environment”, part of the ESG performance statements.
Notes for connection of KPIs with the SASB Standards
Connection of ESG performance indicators with metrics according to SASB Standards, in specific:
- EM-CM-120a.1 under the area “Air Quality” for air emissions of pollutants including NOx, SOx, particulate matter (PM10), dioxins/furans, volatile organic compounds (VOCs), polycyclic aromatic hydrocarbons
(PAHs), and (7) heavy metals.
- EM-CM-160a.1 and EM-CM-160a.2 under the area “Biodiversity Impacts” for the environmental management policies and practices for active sites, and terrestrial acreage disturbed, percentage of impacted area
restored (see also Table “TITAN Group Quarry Sites with High Biodiversity Value” part of the ESG performance statements).
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TITAN Group Quarry Sites with High Biodiversity Value
Site Country Raw Material
use
Location Status Biodiversity
Management
Plan
Notes
Pennsuco
Quarry
USA
Cement and
Aggregates
Miami Dade
Florida
Inside area for protection of freshwater
ecosystems (wetlands) on local/state level
YES
According to New Permit (April 2010), Under Lake Belt Plan - 'Restoring
Littoral Shelf Areas'
BMP developed in 2012
Center Sand
Quarry
USA Aggregates Clermont, Florida
Adjacent to area for preservation of
terrestrial ecosystems on local/state level
YES
Relocate Gopher Tortoise Protected Species into new-created Conservation
Area - Monitoring Program ongoing
BMP developed in 2013
Corkscrew
Quarry
USA Aggregates Naples, Florida
Adjacent to area for protection of
freshwater ecosystems (wetlands) on
local/state level
YES
Preservation of wetlands from invasive species; need to adjust BMP as per
the GCCA Sustainability Guidelines for quarry rehabilitation and
biodiversity management
Zlatna Panega Quarry Bulgaria Cement Zlatna Panega
Partly inside NATURA 2000 area for
protection of terrestrial ecosystems (SAC)
YES
Baseline assessment by an "Initial Ecological Scoping Study" (ATKINS).
A structured BMP was developed in end 2013 acc. to CSI Guidance;
implemented in 2014.
Xilokeratia
Quarry
Greece Cement Milos Island
Inside/adjacent to NATURA 2000 area for
protection of terrestrial and maritime
ecosystems (SAC/SPA)
YES
Apsalos (West and
East) Quarries
Greece Cement Apsalos, Pella
Inside NATURA 2000 area for protection of
terrestrial ecosystems (SPA)
YES
Aspra Homata I + II
Quarries
Greece Cement Apsalos, Pella
Inside NATURA 2000 area for protection of
terrestrial ecosystems (SPA)
YES
Rethimno Quarry Greece Aggregates
Rethimno, Crete
Island
Inside area for protection of terrestrial
ecosystems on national level
YES
Leros Quarry Greece Aggregates Leros Island
Inside area for protection of terrestrial
ecosystems on national level
YES Biodiversity Study completed in 2018, followed by BMP.
Agrinio Quarry Greece Aggregates
Agrinio,
Aitoloakarnania
Inside area for protection of terrestrial
ecosystems on national level
YES Biodiversity Study completed in 2021, followed by BMP.
Thisvi Quarry Greece Aggregates Thisvi, Viotia
Adjacent to NATURA 2000 area for
protection of marine ecosystems (SCI)
NO Biodiversity Study planned for 2022.
Drimos Quarry Greece
Cement and
Aggregates
Drimos,
Thessaloniki
Inside area for protection of terrestrial
ecosystems on national level
NO Biodiversity Study planned for 2023.
Biodiversity Studies for the 'baseline' assessment completed in 2015,
followed by BMPs. The Apsalos and Aspra Homata quarries are covered by
the same biodiversity study and BMP.
Notes
1. The above Table is complementary to the Table 2.3, "Focus area: Positive local impact" , and in specific for the KPIs: a) Active quarries with biodiversity issues, b) Active quarry sites with biodiversity
management plans (number), c) Active quarry sites with biodiversity management plans (percentage).
2.In 2020 an updated biodiversity risk assessment was made for all TITAN Group sites with the use of the Integrated Biodiversity Assessment Tool (IBAT). Based on this assessment, 2 new sites (Thisvi Quarry
and Drimos Quarry) were added in the above list.
3.The above Table includes the needed disclosures for supporting TITAN's performance monitoring and reporting according to the sectoral commitments (GCCA Sustainability Guidelines for Quarry
Rehabilitation and Biodiversity Management, May 2020). Also this information, combined with the disclosures under the respective section of this report, cover the requirements for reporting according to the
SASB Standards for "Biodiversity Impacts" and in more specific the KPI EM-CM-160a.1 Description of environmental management policies and practices for active sites.
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2.4 Focus area: Responsible sourcing
code ESG Performance Indicators Unit 2021 2020 2019 2018 2017
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
2.4.1 Material issue: Resource efficienc
y
, rec
y
clin
g
and recover
y
, contributin
g
to circular econom
y
All Activities
4.1 Water consumption (total)
million m3
11.3 11.1 11.0 10.7 10.5 ƔƔƔ
4.2
Greece
1
million m3
1.6 1.5 1.5 1.6 1.8
4.3
USA
1
million m3
7.9 7.8 7.7 7.2 6.6
4.4
Southeastern Europe
1
million m3
0.9 0.9 0.9 0.7 0.8
4.5
Eastern Mediterranean
1
million m3
0.9 0.9 0.8 1.1 1.4
4.6
Water withdrawal (total, by source)
2
million m3
4
43.2 41.3 39.8 39.2 35.4
ƔƔƔƔ
EM-CM-140a.1
4.7 Ground water
million m3
39.8 37.8 36.4 35.5 31.4
EM-CM-140a.1
4.8 Municipal water
million m3
1.0 0.9 0.9 1.1 1.3
EM-CM-140a.1
4.9 Rain water
million m3
0.2 0.2 0.2 0.2 0.2
EM-CM-140a.1
4.10 Surface water
million m3
0.8 0.8 0.8 0.9 1.0
EM-CM-140a.1
4.11 Quarry water used (from quarry dewatering)
million m3
0.1 0.1 0.1 0.1 0.1
4.12 Ocean or sea water
million m3
1.3 1.3 1.3 1.3 1.3
4.13 Waste water
million m3
0.1 0.1 0.1 0.1 0.1
4.14
Water discharge (total, by destination)
3
million m3
31.9 30.2 28.8 28.5 24.9
ƔƔƔƔ
4.15 Surface (river, lake)
million m3
30.4 28.7 27.3 27.0 23.5
4.16 Sub-surface water (well)
million m3
0.1 0.1 0.1 0.0 0.0
4.17 Ocean or sea
million m3
1.3 1.3 1.3 1.3 1.3
4.18 Off-site treatment
million m3
0.1 0.1 0.1 0.1 0.1
4.19
Other
4,5
million m3
0.0 n/a n/a n/a n/a
Cement and cementitious production activities
4.20 Water consumption (total)
million m3
3.8 3.7 3.7 4.0 4.3
ƔƔƔ
4.21
Greece
1
million m3
1.0 1.0 1.0 1.0 1.2
4.22
USA
1
million m3
1.1 1.1 1.1 1.2 1.1
4.23
Southeastern Europe
1
million m3
0.9 0.9 0.9 0.7 0.7
4.24
Eastern Mediterranean
1
million m3
0.8 0.8 0.7 1.0 1.3
4.25
Water withdrawal (total)
2
million m3
7.8 7.6 7.6 7.9 8.3 Ɣ
EM-CM-140a.1
4.26
Water discharge (total)
3
million m3
4.0 3.9 3.9 4.0 4.0 Ɣ
4.27 Water recycled (total)
million m3
15.2 15.5 15.1 17.7 18.5 ƔƔƔ
EM-CM-140a.1
4.28 Specific water consumption
l/t Cementitious
Product
245.74 260.54 255.70 256.53 259.29 ƔƔƔƔ
4.29 Specific water consumption
l/t Cement
250.86 260.82 257.32 259.18 269.80 ƔƔƔƔ
4.30 Water demand covered with recycled water
%
66.1 67.2 66.5 69.0 69.0
4.31 Avoided water consumption
million m3
36.3 32.5 29.1 25.5 21.8 ƔƔ
SDG 6.3
SDG 6.4
SDG 6.5
SDG 6.3
SDG 6.4
SDG 6.5
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Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
2.4.1 Material issue: Resource efficiency, recycling and recovery, contributing to circular economy
Ready mix concrete activities
4.32 Total water withdrawal
million m3
3.1 3.0 3.0 2.9 3.0 ƔƔ
4.33 Specific water withdrawal
l/m3 Concrete
572.8 577.8 598.3 589.7 555.5 ƔƔ
All Activities
4.34 Thermal energy consumption (total)
TJ
44,834 41,229 43,102 45,740 50,114 ƔƔƔ
EM-CM-130a.1
4.35 Electrical energy consumption (total)
TJ
6,580 6,116 6,328 6,549 6,914 ƔƔƔ
EM-CM-130a.1
Cement production activities
4.36
Integrated cement plants with certified Energy
Management System (ISO 50001 or similar)
% Clinker
production
86.2 54.9 40.5 40.7 6.1 ƔƔƔ
4.37
Thermal energy consumption (Cement, grinding
plants and attached quarries)
TJ
43,756 40,786 42,160 45,176 49,708 ƔƔƔƔƔ
EM-CM-130a.1
4.38 Specific thermal energy consumption
kcal/kg Clinker
839.5 834.9 833.5 835.6 847.1 ƔƔƔƔƔ
4.39
Greece
1
kcal/kg Clinker
894.5 874.3 865.7 853.8 858.2 ƔƔƔƔ
4.40
USA
1
kcal/kg Clinker
760.2 757.7 752.2 752.0 756.0 ƔƔƔƔ
4.41
Southeastern Europe
1
kcal/kg Clinker
839.3 844.9 843.5 844.1 838.7 ƔƔƔƔ
4.42
Eastern Mediterranean
1
kcal/kg Clinker
848.8 852.5 856.1 863.9 890.9 ƔƔƔƔ
4.43
GWh
1,723 1,604 1,661 1,724 1,826 ƔƔƔƔƔ
EM-CM-130a.1
4.44
TJ
6,204 5,773 5,981 6,206 6,573 ƔƔƔƔƔ
EM-CM-130a.1
4.45
Specific electrical energy consumption
1
kWh/t Cement
115.0 113.0 115.4 113.7 115.3 Ɣ
4.46
Greece
1
kWh/t Cement
132.1 130.6 137.4 135.6 141.6 Ɣ
4.47
USA
1
kWh/t Cement
123.0 120.7 121.7 105.8 108.2 Ɣ
4.48
Southeastern Europe
1
kWh/t Cement
100.6 104.8 104.5 102.8 103.3 Ɣ
4.49
Eastern Mediterranean
1
kWh/t Cement
106.5 100.4 101.7 109.1 108.6 Ɣ
4.50
Renewable energy as part of total electrical
energy consumption
1,5
% Electrical
energy
consumed
24.0 22.8 n/a n/a n/a Ɣ
Electrical energy consumption (Cement, grinding
plants and attached quarries)
SDG 6.4
SDG 6.5
SDG 7
SDG 12
SDG 7.2
SDG 7.3
SDG 9.4
SDG 12.2
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code ESG Performance Indicators Unit 2021 2020 2019 2018 2017
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
Ready mix concrete activities
4.51
Specific electrical energy consumption in
concrete production
kWh/m
3
Concrete
3.7 3.5 3.7 3.8 3.2 ƔƔ
SDG 6.4
SDG 6.5
All Activities
4.52 Natural raw materials extracted (total, wet)
million t
3
34.9 32.5 32.4 33.6 34.2
Ɣ
4.53
Raw materials extracted for clinker and cement
production
million t
18.9 17.9 18.5 20.2 21.2 Ɣ
4.54 Raw materials extracted for aggregates
million t
16.1 14.5 13.8 13.5 13.0 Ɣ
Cement production activities
4.55 Materials consumption (total, dry)
million t
22.0 20.6 21.1 22.5 24.4 Ɣ
4.56
Extracted (natural) raw materials consumption
(dry)
million t
20.5 19.3 19.6 21.2 23.0
4.57 Alternative raw materials consumption (dry)
million t
1.5 1.3 1.5 1.2 1.3
4.58
Alternative raw materials use (of total raw
materials consumed)
% Dry
6.6 6.4 7.1 5.5 5.4 ƔƔ
4.59
Alternative raw materials rate (based on clinker-
to-cement (equivalent) factor)
% Dry
7.6 7.2 8.1 6.4 6.3 ƔƔƔƔ
4.60
Avoided consumption of natural resources and
landfilling of alternative materials and fuels
6
million t
27.5 25.7 24.1 22.4 21.0 ƔƔ
All Activities
4.61 Externally recycled waste materials (total, wet
)
t
263,729 273,828 236,736 200,684 259,696
ƔƔ
4.62 Reused
t
23 125 53 1,832 4,395
4.63 Recycled
t
262,928 273,193 236,610 198,831 255,218
4.64 Recovered
t
778 510 74 21 83
4.65
Waste disposal, break down by destination-usage
(wet)
% By mass
100.0 100.0 100.0 100.0 100.0 ƔƔ
EM-CM-150a.1
4.66 Reuse
% By mass
0.0 0.0 0.0 0.7 1.4 ƔƔ
EM-CM-150a.1
4.67 Recycled
% By mass
83.3 82.4 76.8 77.1 79.4 ƔƔ
EM-CM-150a.1
4.68 Recovered (including energy recovery)
% By mass
0.2 0.2 0.0 0.0 0.0 ƔƔ
EM-CM-150a.1
4.69 Incineration
% By mass
0.0 0.0 0.0 0.0 0.0 ƔƔ
EM-CM-150a.1
4.70 Landfilled
% By mass
16.4 17.3 23.1 22.1 19.0 ƔƔ
EM-CM-150a.1
4.71 Other (incl. storage)
% By mass
0.1 0.1 0.1 0.1 0.1 ƔƔ
EM-CM-150a.1
SDG 12.2
SDG 12.2
SDG 12.4
SDG 12.5
SDG 12.2
SDG 12.4
SDG 12.5
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code ESG Performance Indicators Unit 2021 2020 2019 2018 2017
Assurance
GCCA
UNGC
UNCTAD
TCFD
SASB
SDGs and
Targets
4.72 Waste disposal (total, wet)
t
3
315,623 331,709
308,218 258,032
321,240
ƔƔ
EM-CM-150a.1
4.73 Non-hazardous waste
t
315,178 331,201 307,241 255,943 320,436 ƔƔ
EM-CM-150a.1
4.74 Hazardous waste
t
445 508 977 2,089 803 ƔƔ
EM-CM-150a.1
Cement production activities
4.75
Integrated cement plants with “Zero Waste to
Landfill” certification
1,5
% Clinker
production
56.2
29.5 n/a n/a n/a
SDG 12.2
SDG 12.4
Ready mix concrete activities
4.76
Recycled/reused concrete (internally and
externally)
% Returned
concrete
86.0 90.3 86.6 86.9 87.7 ƔƔ
SDG 12.2
SDG 12.4
2.4.2 Material Issue: Reliable and Sustainable Supply Chain
All Activities
4.77
Key suppliers meeting TITAN ESG standards
5,7
%
See Note
below
n/a n/a n/a n/a
SDG 6
SDG 7
SDG 12
SDG 13
SDG 12.2
SDG 12.5
Notes
General Note for the consolidation of data
Consolidation (aggregation) of data for the above ESG performance indicators related to the Material Issue “Resource efficiency, recycling and recovery, contributing to circular economy” was made on the basis of
the percentage of property share for each of the subsidiaries, where TITAN holds a property share of more than 50.0%, also called share of equity for the purposes of non-financial data consolidation. The indicators
were calculated according to the share of equity held by the Group at the end of 2021. Performance of previous years was re-calculated to reflect changes in share of equity in 2021, if required. A detailed list of
TITAN Group subsidiaries and TITAN’s share of equity is provided in the Table 2.5.8 “TITAN Group Basis for Calculating Environmental Performance Indicators”, using the Share of equity, in this section of ESG
performance statements.
Notes for the external verification, standards, guidance, and terms used
Assurance: Specific KPIs denoted in this Table are included in the scope of ERM Certification and Verification Services (ERM CVS) assurance engagement (ERM CVS’ “Independent assurance statement”).
Standards: For the reporting standards under TITAN's Global Sectoral Approach, namely the GCCA, UNGC, UNCTAD, TCFD, and SASB, please refer to the section “TITAN’s approach for ESG Performance reporting” in
the ESG performance statements.
Guidance: TITAN follows the GCCA Sustainability Framework Guidelines, and the Sustainability Guidelines for the monitoring and reporting of monitoring and reporting of water in cement manufacturing. The above
Guidelines had superseded before 2021 the previous – and respective – Guidelines of the WBCSD/CSI, which were the guidance for measuring, reporting and verifying environmental performance until (and
including) year 2018. For the Sector standards, see details in Table 2.5.9 “Sector Standards for the Non-financial disclosures in 2021”.
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Notes on specific KPIs
1. New indicator.
2. Total withdrawal includes also the water quantities withdrawn by TITAN and supplied to third parties without being used in any of TITAN facilities.
3. Total discharge includes also the water quantities withdrawn by TITAN and supplied to third parties without being used in any of TITAN facilities.
4. Refers to the water quantities withdrawn by TITAN and supplied to third parties without being used in any of TITAN facilities.
5. Relevant information is not available for the specific years denoted as 'n/a'.
6. Avoided natural resources consumption is the total accumulated quantity (for water and raw materials/fuels separately) for the period between the specific year and the base year which in the case of natural
resources is 2003, the year of publishing the first sustainability report of TITAN Group. The base year performance for specific water consumption was 503.9lt/tCement, adjusted for the equity of year 2021.
According to TITAN’s approach, all quantities of alternative raw materials and fuels would, otherwise, have been handled as waste and would have been landfilled, with subsequent impacts to the local
environment, land, water resources, and ecosystems.
7. TITAN progressed in 2021 with building an internal Sustainable Supply Chain Roadmap and establishing: (a) New Group Procurement Policy, and (b) Foundations for ESG criteria to evaluate key suppliers, as
defined in accordance with the GCCA Guidance for Sustainable Supply Chain management, and with a meaningful level of spend for TITAN (i.e. 80% of total spend).
Notes for connection of KPIs with the SASB Standards
Connection of ESG performance indicators with metrics according to SASB Standards, in specific:
- EM-CM-130a.1 under the area “Energy Management” for total energy consumed, percentage grid electricity, percentage alternative, and percentage renewable.
- EM-CM-140a.1 under the area “Water Management” for total fresh water withdrawn, percentage recycled, percentage in regions with high or extremely high baseline water stress (see also Table “TITAN Group
Cement Plant Sites within water-stressed Areas” part of the ESG performance statements).
- EM-CM-150a.1 under the area “Waste Management” for amount of waste generated, percentage hazardous, percentage recycled.
TITAN Group Cement Plant Sites within water-stressed Areas
Site Country Water Stress (Baseline)
Antea Albania >80%
Zlatna Panega Bulgaria >80%
Alexandria Egypt 40-80%
Beni Suef Egypt 40-80%
Kamari Greece 40-80%
Patras Greece 40-80%
Thessaloniki Greece 40-80%
Kosjeric Serbia 40-80%
Tokat Turkey 40-80%
N
N
o
otes
1. The water risk assessment for all TITAN Group sites was conducted in 2020 with the use of the World Resources Institute's (WRI) Aqueduct tool.
2. The above Table presents the Cement Plant sites (as the larger water users among Group activities) that operate within water-stressed areas, namely the areas where the Baseline Water Stress Indicator
is >40%, as classified by the Aqueduct tool.
3. The Water Stress Indicator measures the ratio of total water withdrawals to available renewable surface and groundwater supplies. Higher values indicate more competition among users.
4. This information for the activities that operate in water-stressed areas, combined with the disclosures under the section 'Non-financial performance overview' of this report, cover also the requirements
for reporting according to the SASB Standards for 'Water Management' and in more specific the KPI EM-CM-140a.1 (1) Total fresh water withdrawn, (2) percentage recycled, (3) percentage in regions with
High or Extremely High Baseline Water Stress.
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Code Governance Core Indicators Notes Performance 2022 Reporting
Standards
Board structure
5.1 Number and percentage of female board members
Number of females: 3
Contribution to the total: 20%
5.2 Number of nationalities represented on the Board 6
Board members by age range
5.3 Under 30 0
5.4 Between 30-50 1
5.5 Over 50 14
5.6 Number of independent board members 8/15
Board effectiveness
5.7 Number of board meetings and attendance rate
1
Seven (7) scheduled meetings were held in 2021, with
attendance rate reaching 99.05%.
5.8
Audit and Risk Committee: Number of meetings and
attendance rates
2
Six (6) meetings with 100% attendance.
5.9
Nomination Committee: Number of meetings and
attendance rates
2
One (1) meeting with 100% attendance.
5.10
Remuneration Committee: Number of meetings and
attendance rates
2
One (1) meeting with 100% attendance and one (1) meeting
was held by circulation.
Compliance and business ethics
5.11 Grievance mechanism (Ethicspoint) coverage
3 100%
5.12 Number of cases reported in EthicsPoint
3 In 2021, 11 cases in total were reported through the
EthicsPoint platform, ten of which were classified as
allegations and one as an Inquiry (complaint).
5.13 Percentage of unionised employees (%)
4 33.22%
5.14
Percentage of employees covered by Collective Bargain
Agreements (CBAs)
5 52.26%
5.15
Average number of hours of training on subjects related
to Compliance, per employee
6 1.67
2.5.1 Good governance, transparency and business ethics
Notes
Note for the standards, guidance, and terms used
The KPIs referred in ESG Performance Statements as Governance core indicators are in line with the requirements of the UNCTAD Guidance on reporting of
Core Indicators (UNCTAD, 2019), and are connected with the most relevant SDGs and specific Targets for each SDG. Specific KPIs from this list are also
essential to reporting on progress with respect to TITAN Group commitments for the UNGC Ten Principles.
Notes for specific Governance core indicators
1. Number of board meetings during the reporting period and number of Board members who participate at each Board meeting during the reporting period
divided by the total number of directors sitting on the Board multiplied by the number of Board meetings during the reporting period.
2. Number of board meetings during the reporting period and number of Audit committee members who participate at each Audit committee meeting during
the reporting period divided by the total number of members sitting on the Audit committee multiplied by the number of Audit committee meetings during
the reporting period.
3. Of the ten (10) cases classified inside the TITAN EthicsPoint as allegations, nine (9) cases were thoroughly examined by the respective regional committees
and reviewed by the Group Supervisory Committee, while one (1) case is still in process of examining. Out of these nine (9) cases, two (2) were found fully
substantiated, one (1) was partially substantiated and six (6) were unsubstantiated. For each of the substantiated cases an action plan for remediation was
implemented. In more specific, the cases with action plans related to the areas of 'Environment, Health & Safety’, and ‘People, Diversity and Workplace
Respect'.
4. Specific information provided by the Adocim BU under confidentiality for the names of employees.
5. In 2021 this percentage reached 52.3%, slightly increased compared to 51.7% in 2020. The breakdown by employees in USA (TITAN America) and other
countries was 9.1% vs. 85.5%, close to the respective figures of 2020 (9.3% and 85.0% respectively). TITAN keeps annual records of number and duration of
strikes and lockouts inside internal data collection systems (zero cases recorded in 2021). These disclosures cover the requirements for reporting according to
the SASB Standards for 'Labor Relations' and in more specific the metrics (KPIs) EM-MM-310a.1 and EM-MM-310a.2.
6. Average number of hours of training per employee and per year, on Policies & internal regulations of TITAN (priority being on the Code of Conduct, Policies
for Human Rights, Anti-Bribery, GDPR, but without considering this list as exhaustive). The KPI is calculated as total hours of training in the subject areas,
divided by the total number of employees. TITAN categorizes these training subjects under the overall subject area: "Compliance" (see Table 2.2, for the KPI
"Training hours per subject, Group total").
SDG 5.5
SDG 16.5
SDG 16.6
SDG 16.7
UNGC
UNCTAD
SASB
5
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Taxonomy-Eligible Economic Activities
Turnover
1
(mEUR)
%Turnover
1
(%of Total)
OpEx
2
(mEUR)
%OpEx
2
(%of Total)
CapEx
3
(mEUR)
%CapEx
3
(%of Total)
Manufacture of cement clinker, cement or
alternative binder
1,004.7 58.6% 71.0 60.5% 74.3 58.9%
Taxonomy Non-eligible Economic Activities 709.9 41.4% 46.2 39.5% 51.7 41.1%
TITAN Group (Total) 1,714.6 100.0% 117.2 100.0% 126.0 100.0%
Notes
Consolidated data Group level (‘consolidated’ data ‘after elimination’)
General Note
The Taxonomy Regulation is a key component of the European Commission's action plan to redirect capital flows towards a more sustainable economy. It
represents an important step towards achieving carbon neutrality by 2050 in line with EU goals as the Taxonomy is a classification system for environmentally
sustainable economic activities.
In this section, TITAN as a parent undertaking presents the share of our group turnover, capital expenditure (CapEx) and operating expenditure (OpEx) for the
reporting period 2021, which are associated with Taxonomy-eligible economic activities related to the first two environmental objectives (climate change
mitigation and climate change adaptation) in accordance with Art. 8 Taxonomy Regulation and Art. 10 (2) of the Art. 8 Delegated Act.
Specific Notes for the Taxonomy KPIs
1. The calculation of Turnover covered the revenue recognized pursuant to International Accounting Standard (IAS) 1, paragraph 82(a), as adopted by
Commission Regulation (EC) No 1126/2008 (1), and as defined in Article 2, point (5), of Directive 2013/34/EU.
The economic activities in this category were associated with NACE code C23.51 in accordance with the statistical classification of economic activities
established by Regulation (EC) No 1893/2006. An economic activity in this category is a transitional activity as referred to in Article 10(2) of Regulation (EU)
2020/852 where it complies with the technical screening criteria set out in this Section. The activity complies with the criteria set out in Appendix A to this
Annex for climate adaptation. In addition to the economic activity of manufacture of cement clinker, cement or alternative binder, the economic activity of
processing and selling of fly ash could also be considered as Taxonomy-eligible activity, although not economically material to disclose, since its contribution
to the total Turnover of the Group reached 0.1% in 2021.
2. For calculating the figure of operational expenditures (OpEx), we considered all direct non-capitalized costs that relate to research and development
(research and innovation investments), building renovation measures, short-term lease, maintenance and repair, and any other direct expenditures relating to
the day-to-day servicing of assets of property, plant, and equipment by TITAN or third party to whom activities are outsourced, that are necessary to ensure
the continued and effective functioning of such assets.
3. The capital expenditures (CapEx) covered additions to tangible and intangible assets during 2021 considered before depreciation, amortization, and any re-
measurements, including those resulting from revaluations and impairments, for the relevant financial year and excluding fair value changes. Under the CapEx
figure, we included costs that are accounted based on IAS 16.73 (e)(i)(iii), IAS 38.118 (e)(i), IAS 40.76 (a)(b), and IFRS 16.53(h).
2.5.2 Taxonomy
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2.5.3 ESG Polices
Decarbonization
and
Digitalization
Growth-enabling
work
environment
Positive
local impact
Responsible
sourcing
Good governance,
transparency and
business ethics
Environmental Policy ƔƔƔ
Occupational Health and Safety (OH&S) Policy Ɣ
Code of Conduct Policy √
ƔƔ
Diversity and inclusion Policy √ Ɣ
CSR Policy Ɣ
Procurement Policy √ ƔƔ
Whistleblowing Policy Ɣ
Human Rights Policy
ƔƔƔƔ
Anti-Bribery and Corruption Policy Ɣ
Competition Law Compliance Policy Ɣ
Confict of Interest Policy Ɣ
Data Protection Policy
ƔƔ
Information Security Policy ƔƔ
Sanctions Policy Ɣ
Group Polices New or
Updated in
2021
TITAN Focus Areas mostly relevant
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Area Albania Bulgaria Egypt Greece Kosovo North Macedoni Serbia Turkey USA
H&S ISO 45001
All
operations
ISO 45001
All
operations
ISO 45001
All
integrated
cement
plants
ISO 45001
All
operations
(except 2
terminals)
ISO 45001
All
operations
ISO 45001
All
operations
ISO 45001
All
operations
ISO 45001
(1) integrated
cement plant,
(1) grinding
cement plant
and (1) RMC
unit
All operations
conform with
the regulatory
framework of
MSHA and OSHA
Environment
ISO 14001
All
operations
(except 1
terminal)
ISO 14001
All
operations
ISO 14001
All
integrated
cement
plants
ISO 14001
All
operations
(except 2
terminals)
ISO 14001
All
operations
ISO 14001
All
operations
ISO 14001
All
operations
ISO 14001
(1) integrated
cement plant,
(1) grinding
cement plant
and (1) RMC
unit
All operations
conform with
the regulatory
framework of
EPA
Quality ISO 9001
All
operations
ISO 9001
All
operations
(except 2
quarries)
ISO 9001
All
integrated
cement
plants
ISO 9001
All
operations
(except 1
quarry)
ISO 9001
All
operations
ISO 9001
All
operations
(except 1
quarry)
ISO 9001
All
operations
ISO 9001
All operations
(except 1
terminal)
Quality ASHTO
All operations
Energy ISO 50001
All RMC
units
Energy
audits
(1)
integrated
cement
plant
ISO 50001
All
integrated
cement
plants
ISO 50001
All
integrated
cement
plants,
Energy
audits
All RMC
units
All
aggregates
quarries
ISO 50001
(1)
integrated
cement
plant
ISO 50001
All integrated
cement plants
(3) quarries for
cement raw
materials
(1) RMC unit
ISO 50001
All integrated
cement plants
Social GHRMS/SF
and SA
8000
All
operations
GHRMS/SF
All
operations
GHRMS/SF
All
operations
GHRMS/SF
All
operations
GHRMS/SF
and SA
8000
All
operations
GHRMS/SF
All
operations
GHRMS/SF
All
operations
GHRMS/SF
All
operations
GHRMS/SF
All
operations
2.5.4 Group Management Systems
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2.5.5 Political contributions and Fines and other non-monetary sanctions
Country
Political contributions
1
(in Euros)
Significant fines
2, 3
(in Euros)
Total number of
non-monetary sanctions
2
Albania
2
0 10,900 0
Brazil
000
Bulgaria
000
Egypt
000
Greece
3
000
Kosovo
000
North Macedonia
000
Serbia
000
Turkey
000
USA
1
20,307 0 0
Notes
1. Total value of political contributions by country, including the total monetary value of financial and in-kind contributions made
directly and indirectly.
In 2021, TITAN America contributed with the total amount of 20,307 Euros various political organizations in support of local
elections in Virginia and Florida. From the total amount spend, 16,334 Euros was offered to support political institutions and
candidates in Virginia (payment made by Titan America LLC), and 3,973 Euros was offered to support political institutions and
candidates in Florida.
Except the above, no other cases of political contributions were recorded, neither financial nor in-kind, directly, or indirectly.
2. Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with laws and regulations,
including but not limited to environmental laws and regulations, laws and regulations concerning the provision and use of
products and services, labor laws and regulations, and laws and regulations concerning anti-corruption, anti-competitive
behavior and anti-trust or monopoly practices. Whereas: TITAN considers 'significant fine' any fine over 10,000 Euros.
In 2021 there was one case of significant fine paid: A penalty imposed to Antea Cement (Albania) by the General Customs
directorate for unmarked diesel, and related to unpaid Excise tax, in the amount of 10,900 Euros. The case was sent to
administrative court in the country for ungrounded claim by the Customs directorate.
In 2021 there were four cases of fines imposed and paid by Antea in Albania and its subsidiaries, for different violations of legal
requirements for administrative matters, but not considered significant. in specific: An amount of 3,600 EUR imposed by the
General Customs directorate for unmarked diesel, related to the above case related to unpaid Excise tax. Also, three fines in the
amount of 3,300 Euros each, imposed by the National Business Centre of Albania due to delays in the registration of the Ultimate
Beneficiary for each of the companies. The registration was completed in 2021, and the case was attributed to unclear ruling for
the pertinent legal requirements, administrative documentation, and applicable deadlines by the state.
3.Also, there was one case of fine related to non-compliance of TITAN's operations in Greece, but not considered significant: A
fine of an amount of 6,000 Euros was imposed to, and paid by, Interbeton LLC for a violation of labor law, namely negligence for
updating properly the required maintenance records for a concrete pump, which was involved in an occupational accident in
2020.
No corruption-related fines were imposed by regulators and courts in the reporting period.
The above disclosures cover the requirements for reporting according to the SASB Standards for 'Pricing Integrity and
Transparency' and in more specific the metric (KPI) EM-CM-520a.1. 'Total amount of monetary losses as a result of legal
proceedings associated with cartel activities, price fixing, and anti-trust activities'.
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Area Albania Bulgaria Egypt Greece North
Macedonia
Kosovo Serbia Turkey USA Total
External
1124311316
Internal
1201123
External
1231119
Internal
134
External
1521110
Internal
3148
External
13112531
Internal
213
External
63110
Internal
0
External
1517
Internal
1 1
External
4 3 4 1 10 4 26
Internal
1213119
External
6 7 19 17 20 3 5 31 1 109
Internal
003313141548
2.5.6 Environmental Audits
Environmental Management System
Energy Management System/Energy
audits
CO
2
emissions
Waste Management
Complaints
Permitting
Other
TOTAL
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2.5.7 Consolidated Report on Payments to Governments for extractive operations
Group Companies
Country
Payment type Amount
TITAN CEMENT S.A. Greece Quarry Rental Fees/taxes 795,269.00
Quarry Rental Fees 2,127,848.76
Municipality Taxes 667,571.91
Clay Tax
2,333,374.00
Quarry Royalties 1,006,625.00
Clay Tax 3,356,420.00
Quarry Royalties 1,289,823.00
Road maintenance 138,314.00
TBAE EGYPT
Quarry Roylaties 221,925.00
Zlatna Panega Cement AD Bulgaria Concession Fees 209,000.00
Cementi Antea Sha Albania Extraction Fees 491,543.00
Titan America LLC USA Sales / Mitigation Fees 369,151.10
SHARRCEM SH.P.K. Kosovo Extraction Royalties 206,903.00
Titan Cementarnica Usje A.D. North Macedonia
Concession Fees
236,576.00
Titan Cementara Kosjeric A.D. Serbia
Concession Fees
179,435.00
ADOCIM A.S. Turkey
Permission/Forestation Fees
372,841.00
TOTAL 14,002,619.77
Note
TITAN Cement International S.A. hereby reports, in accordance with article 3:33 of the Belgian Companies and Associations Code, that TITAN Cement Group
has paid to municipal authorities of EU Member States and third countries the total amount of €14,002,619.77 for extractive operations in 2021, with the
analytical data per country as presented in the above table. As specified in article 6:2 par. 2 of the Royal Decree dated 29 April 2019 on the execution of the
Belgian Companies and Associations Code, the limit for disclosing the respective data is set at 100,000€ as a single payment or as a series of related
payments.
INTERBETON S.A. Greece
Alexandria Portland Cement Co Egypt
Beni Suef Cement Co Egypt
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2.5.8 TITAN Group Basis for Calculating Environmental Performance Indicators, using the Share of equity
1
Region Country Activity 2021 2020
USA USA All 100.00% 100.00%
Greece and Western Europe Greece All 100.00% 100.00%
Albania All 100.00% 100.00%
Bulgaria All
100.00% 100.00%
North Macedonia All 100.00% 100.00%
Kosovo All 100.00% 100.00%
Serbia All 100.00% 100.00%
Egypt All 100.00% 100.00%
Adocim all activities 75.00% 75.00%
Marmara grinding plant 100.00% 100.00%
Southeastern Europe
Eastern Mediterranean
Turkey
Note
1. The term "share of equity" is used as a "proxy" of the percentage of property share, and only for the above purposes
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2.5.9 Sector Standards for the Non-financial disclosures in 2021
Sector Association or
Initiative
Guidelines and other documents of reference Published
Sustainability Charter
Sustainability Framework Guidelines
Sustainability Guidelines for the monitoring and reporting of safety in cement
and concrete manufacturing. This document has been agreed within the GCCA
to have extended application to concrete and other related activities [Pillar 1]
Sustainability Guidelines for the monitoring and reporting of CO
2
emissions
from cement manufacturing [Pillar 2]
Sustainability Guidelines for the monitoring and reporting of water in cement
manufacturing [Pillar 4]
Sustainability Guidelines for the monitoring and reporting of emissions from
cement manufacturing [Pillar 4]
Sustainability Guidelines for co-processing fuels and raw materials in cement
manufacturing [Pillar 5]
Sustainability Guidelines for quarry rehabilitation and biodiversity
management [Pillar 4]
Guidance for Sustainable Supply Chain Management [Pillars 1, 3 and 5]
(Previously) WBCSD/CSI
Recommended Good Practices for: (a) Contractor Safety, and (b) Driving
Safety
2009
GCCA
Latest edition (publications between
2019 and 2021)
Notes
The Global Cement and Concrete Association (GCCA) has built its Sustainability Charter around five (5) Sustainability Pillars, to encompass the full
sustainability spectrum for its work purposes:
Pillar 1: Health and Safety, Pillar 2: Climate Change and Energy, Pillar 3: Social Responsibility, Pillar 4: Environment and Nature and Pillar 5: Circular Economy.
The terminology of 'Pillars' is specific to the GCCA Charter of commitments for member companies, and details are available in the Charter and Framework
Guidelines in the GCCA website: https://gccassociation.org/sustainability-innovation/sustainability-charter-and-guidelines/
TITAN was actively participant in 2021 in various working groups of the GCCA, contributing with knowhow and expertise, in line with its practice in the
previous years.
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General Note for the consolidation of data
Consolidation (aggregation) of data for the above Value Creation Core Indicators was made with 100.0% contribution for all BUs where TITAN has
property share more than 50.0% (in line with the method of full consolidation in the Financials). The contribution of Turkey included Adocim
Cemento Beton Sanayi ve Ticaret AS with 100%.
Notes for the standards, guidance, and terms used
Most terms related to the Value Creation Core Indicators were adopted from the “Guidance on Core Indicators for entity reporting on the
contribution towards the attainment of the Sustainable Development Goals” (in short: UNCTAD Guidance, 2019), and incorporated under the TITAN
standards. The related terms are outlined here and connected with the KPIs in the Index above. The figures for the Value Creation Core Indicators
are provided in “Understanding TITAN, Creating and sharing value”.
Detailed figures are provided in the Report under ‘Creating and sharing value', see also: Tables 2.1, 2.2 and 2.3.
1. The economic value created and distributed to key stakeholders has been calculated using the United Nations – UNCTAD “Guidance on Core
indicators for entity reporting on the contribution towards the attainment of the Sustainable Development Goals” (2019 edition).
2. Gross Value added. Revenue minus costs of bought-in materials, goods, and services (called also: Value Added, according to the UNCTAD Guidance,
2019). TITAN’s approach is based on the verified and disclosed Financial Statements for the same reporting period, acc. to the IFRS.
3. Net value added. Revenue minus costs of bought-in materials, goods and services and minus depreciation on tangible assets (UNCTAD Guidance,
2019). TITAN’s approach is based on the verified and disclosed Financial Statements for the same reporting period, acc. to the IFRS.
4a."Total spend on Suppliers, local and international, for goods and services. According to TITAN Standards and the application of the IFRS, and in
accordance with the approach for %local spend of TITAN" as defined in 4b below.
4b.% local spend of TITAN. The ratio of spend on local suppliers over the total spend on all suppliers, as a percentage. Costs of local procurement are
a general indicator of the extent of an entity’s linkages with the local economy (UNCTAD Guidance, 2019). TITAN uses a bottom-up approach of
raising awareness, guiding, and supporting the local BUs, in the direction of gathering – from the respective data sources – all such information, and
consolidating on Group level. ‘Local’ are those suppliers which provide goods or services to TITAN and have company tax registration inside the
country of interest, same as the country of TITAN BUs’ location and tax registration. For cases of countries with governmental structure
characterized as ‘Federation-of-states’ – in specific applies today to USA where different states have ‘local’ governments and vast geographical
extent – the term ‘local’ refers to those suppliers with company tax registration in the same state with the tax registration of the BU or location of
operations. TITAN discloses the respective figure in Table 2.3 of the ESG Performance Statements.
5. Taxes to national and local authorities. According to TITAN Standards and the application of the IFRS, see Financial Statements.
6. Payments in cash, to shareholders and minorities. According to TITAN Standards and the application of the IFRS, see Financial Statements.
7. Total spend on donations and social engagement initiatives. Total amount of charitable/voluntary donations and investments of funds (both capital
expenditures and operating ones) in the broader community where the target beneficiaries are external to the enterprise incurred in the reporting
period, in absolute amount (UNCTAD Guidance, 2019). TITAN discloses this amount as "Donations", as equivalent to "charitable/voluntary donations
and investments of funds", and in detail in Table 2.3 based on the verified and disclosed Financial Statements for the same reporting period.
8.Investments in environmental protection. Total amount of expenditures (capital and operational) for those investments whose primary purpose is
the prevention, reduction and elimination of pollution and other forms of degradation to the environment (UNCTAD Guidance, 2019). TITAN discloses
the respective figures in detail in Table 2.3 of the ESG Performance Statements (KPI "Environmental expenditures across all activities").
9. Salaries (contributions to) pensions, and social benefits, including additional benefits beyond those provided by law. According to TITAN Standards
and the application of the IFRS, see Financial Statements.
10. Investments in training of direct employees. Total expenditures including the direct and indirect costs of training for direct employees (including
costs such as trainers’ fees, training facilities, training equipment, related travel costs etc.) reported also per employee and per year, and broken
down by employee category (UNCTAD Guidance, 2019). TITAN discloses the respective figures in detail in Table 2.2 of the ESG Performance
Statements.
11. Investments for Research and Innovation. Total amount of expenditures on research and development (R&D) and Innovation by the reporting
entity during the reporting period (UNCTAD Guidance, 2019). It includes all expenditures for the R&D and Innovation activities, and projects, and incl.
salaries, participations, travelling and other expenses of our employees which are related directly and indirectly, and other expenditures for
promoting innovative technologies and products. TITAN uses the verified and disclosed Financial Statements for the same reporting period. TITAN
discloses the respective figure in detail in Table 2.1 of the ESG Performance Statements.
12. Capital expenditures. Capital expenditures, commonly known as CapEx, are funds used by a company to acquire, upgrade, and maintain physical
assets such as property, buildings, an industrial plant, technology, or equipment.
2.5.10 Notes for Value Creation Indicators
The following Notes are inclusive of definitions for terms used in specific for Value creation and distribution to stakeholders and serves as index of Notes for
Table “Creating and sharing value”
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Scope Principle Criteria for GC Advanced Level TITAN Approach TITAN Reference
Criterion 3
The CoP describes robust
commitments, strategies or
policies in the area of human
rights
Criterion 4
The CoP describes effective
management systems to
integrate the human rights
principles
Criterion 5
The CoP describes effective
monitoring and evaluation
mechanisms of human rights
integratio
TITAN’s Human Rights Policy
(updated in 2020) is in line with the
UN Guiding Principles on Business and
Human Rights (2011). The policy
explicitly addresses the provisions of
the International Bill of Human Rights
(consisting, in addition to the
Universal Declaration of Human
Rights), of the International Covenant
on Economic, Social and Cultural
Rights) and the principles concerning
fundamental rights set out in the
International Labor Organization’s
Declaration on Fundamental
Principles and Rights at Work.
We set targets to improve
continuously our performance
particularly in the areas identified and
prioritized as more material for our
stakeholders.
IAR 2021
Understanding TITAN and Management report. In specific: Message from the Chairman
of the BoD, Message from the Chairman of the Group Executive Committee, Corporate
governance and risk management, ESG performance review, and ESG performance
statements: Table 1, ESG performance KPIs, Table 2.5.3, and Table 2.5.4.
Additional Notes to the ESG performance statements:
1. TITAN received no fines for non-compliance with human rights-related laws and
regulations in 2021.
2. Unions, where established, operate freely according to each country’s laws and
regulations.
3. Sustainability clauses referring to respect of human rights are included in all tenders
for global suppliers and contracts for local suppliers.
4. Security is fundamental for a safe working environment, protection of assets and
intellectual property. Third parties providing or interested to provide security services
must ensure that their employees are trained appropriately and respect the
international standards and principles.
5. A Group-level grievance mechanism is in place to facilitate reporting of potential
violations of Group Code of Conduct and respective policies (EthicsPoint).
6. All operations certified according to ISO 14001 and ISO 9001 (see Table 2.5.4) apply
mechanisms to record feedback and complaints by key external stakeholders.
TITAN Website: Sustainability, and Corporate Governance/Group Policies
3. 2021 TITAN Group Global Compact Advanced Communication on Progress Review (CoP)
The contents of TITAN Group 2021 Integrated Annual Report also serve as a progress report on implementation of the ten principles of the UN Global Compact and the Sustainable Development Goals.
Since 2015, TITAN communicates performance to stakeholders also aligned with SDGs 2030 and key performance indicators in the ESG Performance statements are accordingly to codified serve
understanding of TITAN’s contribution to sustainable development.
Implementing
the Ten
Principles into
Strategies and
Operations
Criterion 1
The CoP describes
mainstreaming into
corporate functions and
business units
Criterion 2
The CoP describes value
chain implementation
TITAN’s commitment to responsible
business is embedded into governing
objective and business practice,
articulated in TITAN’s Code of
Conduct and Group Policies for
Human Rights, Occupational Health
and Safety, Environmental Policy and
Climate Mitigation Strategy, Anti-
Corruption and Bribery
IAR 2021
Understanding TITAN and Management report. In specific: Message from the Chairman
of the BoD, Message from the Chairman of the Group Executive Committee, Corporate
governance and risk management, ESG performance review, and ESG performance
statements: Table 1, ESG Performance KPIs, Table 2.5.3, Table 2.5.4, Table 2.5.7, 2.5.10
Value Creation Core Indicator Index.
TITAN Website: Sustainability, and Corporate Governance/Group Policies
Human Rights
Management
Policies and
Procedure
Principle 1
Businesses should
support and respect
the protection of
internationally
proclaimed human
rights
Principle 2
Businesses should
make sure they are
not complicit in
human rights abuse
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Scope Principle Criteria for GC Advanced Level TITAN Approach TITAN Reference
IAR 2021
Understanding TITAN and Management report. In specific: Message from the Chairman of
the BoD, Message from the Chairman of the Group Executive Committee, Understanding
TITAN, (Our business approach in a changing global landscape, Materiality assessment
and stakeholder engagement), Corporate governance and risk management (Corporate
governance statement), ESG performance review, and ESG performance statements:
Table 1, ESG Performance KPIs, Table 2.5.3, Table 2.5.4, 2.5.10 Notes for Value Creation
Indicators.
Additional Notes to the ESG performance statements:
1. TITAN received no significant fines for non-compliance with labor laws in 2021. There
was one case of fine related to non-compliance of TITAN's operations in Greece, but not
considered significant. See details in the ESG Statements, Table 2.5.5 Political
contributions and Fines and other non-monetary sanctions.
2. Regular meetings with union representatives are conducted with the management
throughout the year. Main topics cover among else wages and additional benefits,
proposals to improve health and safety conditions at work and other topics raised by
employees. Health and Safety Councils or Committees comprising of management and
employee representatives are formed at plant level to ensure employee engagement in
efforts to improve health and safety performance.
3. A health surveillance program focused on potential impacts like noise, dust and
crystalline silica is implemented according to TITAN Group Guidelines.
4. Collective bargaining agreements are applicable to TITAN employees in all countries
that such agreements exist. The continuous increase of employment for TITAN
operations in countries with limited union presence (compared to other countries with
extensive union presence) has led to a trend of relevant decrease of the number of TITAN
employees covered by collective bargaining agreements during the last 5 years. For
details about 2021 data related to TITAN operations see the ESG Statements, Table 2.5.1
Good governance, transparency and business ethics.
TITAN Website: Sustainability, and Corporate Governance/Group Policies
Rubust labor
Management
Policies and
Procedures
Principle 3
Businesses should
uphold the freedom of
association and the
effective recognition of
the right to collective
bargaining
Principle 4
The elimination of all
forms of forced and
compulsory labor
Principle 5
The effective abolition
of child labor
Principle 6
The elimination of
discrimination in
respect of employment
and occupation
Criterion 6
The CoP describes robust
commitments, strategies or
policies in the area of labor
Criterion 7
The CoP describes effective
management systems to
integrate the labor principles
Criterion 8
The CoP describes effective
monitoring and evaluation
mechanisms of labor
principles
TITAN’s People Management
Framework safeguards common
standards throughout the Group
operations and enables the
implementation of the Group Human
Rights Policy in accordance with
international standards and the UN
Guiding Principles for Business and
Human Rights.
The TITAN Group Occupational
Health and Safety Policy provides the
framework to implement TITAN’s
ambition and long-term targets for
health and safety at work.
Equal opportunities and work-life
balance are ensured with the
provision of job opportunities and
career development, flexible working
options for female employees and
various additional benefits for
employees’ families.
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Scope Principle Criteria for GC Advanced Level TITAN Approach TITAN Reference
IIAR 2021
Understanding TITAN and Management report. In specific: Message from the Chairman
of the BoD, Message from the Chairman of the Group Executive Committee,
Understanding TITAN, (Our business approach in a changing global landscape, Creating
and Shaping Value, Focusing on Material Issues), Corporate governance and risk
management, ESG performance review and ESG performance statements: Table 1, ESG
Performance KPIs, Table 2.5.3, Table 2.5.4, Table 2.5.8 and Table 2.5.9..
Additional Notes to the ESG performance statements:
1. In 2021 no cases of significant fines or penalties were recorded, related to
noncompliance of TITAN's operations with environmental laws.
TITAN Website: Sustainability, and Corporate Governance/Group Policies
Robust
environmental
management
policies and
procedures
Principle 7
Business should
support a
precautionary
approach to
environmental
challenges
Principle 8
Undertake initiatives
to promote greater
environmental
responsibility and
Principle 9
Encourage the
development and
diffusion of
environmentally
friendly technologies
Criterion 9
The CoP describes robust
commitments, strategies or
policies in the area of
environmental stewardship
Criterion 10
The CoP describes effective
management systems to
integrate the environmental
principles
Criterion 11
The CoP describes effective
monitoring and evaluation
mechanisms for
environmental stewardship
TITAN early recognized that Climate
Change is a major challenge with
planetary impacts and also corporate
risks, and committed to playing its
part in developing practical solutions
at national, regional and global level.
The Environmental Policy and Climate
Change Mitigation Strategy of TITAN
(published in 2018) reflects our
commitment to sustainable
development and our approach
towards addressing the challenges
and opportunities of climate change.
As a heavy industry also focus on
assessing and reducing
environmental impacts at each
facility while increasing the positive
impact through on-going
collaborative efforts, extensive use of
Best Available Techniques, innovation
and adoption of best practice.
Environmental due diligence is
conducted by internal and external
experts on operating facilities and
new projects.
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Scope Principle Criteria for GC Advanced Level TITAN Approach TITAN Reference
IAR 2021
Understanding TITAN and Management report. In specific: Message from the Chairman
of the BoD, Message from the Chairman of the Group Executive Committee,
Understanding TITAN, Corporate governance and risk management, ESG performance
review, and ESG performance statements: Table 1, Table 2.5.1, Table 2.5.3, Table 2.5.4,
Table 2.5.5, Table 4.
Additional Notes to the ESG performance statements:
1. TITAN received no fines for non-compliance with anti-corruption laws and regulations,
and no incidents of legal action for anti-competitive behavior, anti-trust or monopoly
practices recorded during 2021.
2. TITAN continues to engage with governments and take public positions on different
business issues through business associations and business driven initiatives such as
the UN Global Compact and the Global Cement and Concrete Association (GCCA).
3. Since 2020 the Group has established a common platform of use by all countries,
providing access to anonymous reporting of incidents to all TITAN employees, called
TITAN EthicsPoint. In 2021, 11 cases in total were reported through the EthicsPoint
platform, ten (10) of which were classified as allegations and one as an inquiry or
complaint. For details about 2021 data related to TITAN's operations see the ESG
Statements, Table 2.5.1 Governance Core Indicators.
4. Mechanisms for supporting our communities and local stakeholders to report
incidents operate in all countries, while guidance and technical infrastructure is
provided to BUs. In more specific TITAN follows the good practice of recording cases of
incidents from local communities (as ‘complaints’ or ‘grievance’) through an internal
data collection system. No important cases of incidents were recorded in 2021 in any of
BUs of TITAN's operations.
5. TITAN’s Code of Conduct ensures transparency regarding relations with political
institutions. In 2021, TITAN America contributed with the total amount of 20,307 Euros
various political organizations in support of local elections in Virginia and Florida. For
details about 2021 data related to TITAN's operations see the ESG Statements, Table
2.5.5 Political contributions and Fines and other non-monetary sanctions.
TITAN Website: Sustainability, and Corporate Governance/Group Policies
Robust anti-
corruption
management
policies and
procedures
Principle 10
Business should work
against corruption in all
its forms, including
extortion and bribery
Criterion 12
The CoP describes robust
commitments, strategies, or
policies in the area of anti-
corruption
Criterion 13
The CoP describes effective
management systems to
integrate the anti-corruption
principle
Criterion 14
The CoP describes effective
monitoring and evaluation
mechanisms for the
integration of anti-corruption
TITAN acknowledges the risk of
bribery and corruption and
accordingly endorsed the Global
Compact collaborative efforts for the
10th principle. The following TITAN
Group policies provide relevant
guidance to all employees, underline
the principle of non-tolerance, and
mandate the BUs to follow regular
training to employees: Group Anti-
Bribery and Corruption Policy,
Conflict of Interest Policy, and Group
Code of Conduct.
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Scope Principle Criteria for GC Advanced Level TITAN Approach TITAN Reference
IAR 2021
Understanding TITAN and Management report. In specific: Understanding TITAN (Our
business approach in a changing global landscape, Creating and Sharing Value, Focusing
on Material Issues), ESG performance Review, and ESG performance statements: Table 1,
ESG Performance KPIs, Table 2.5.1, Table 2.5.3 and Table 2.5.4.
Notes
- See Criteria 1-18
- Independent Auditors’ Assurance Statement Non-financial performance review
according to the UNGC criteria (see criteria 2-14)
TITAN Website: Sustainability, and Corporate Governance/Group Policies
Taking action in
support of
broader UN goals
and issues
The ten principles of
the United Nations
Global Compact
Criterion 15
The CoP describes core
business contributions to UN
goals and issues
Criterion 16
The CoP describes strategic
social investments and
philanthropy
Criterion 17
The CoP describes advocacy
and public policy engagement
Criterion 18
The CoP describes
partnerships and collective
action
TITAN was among the first 500
signatories of the UN Global Compact
initiative and remains a participant at
both global and local levels with
active engagement in local UNGC
Networks in Greece, Serbia and N.
Macedonia. TITAN is also member of
CSR Europe since 2004 and an
elected Board member since 2019. At
local member, TITAN is a founding
and active member in CSR Hellas,
CSR Albania and CSR Kosovo, as well
as in the Hellenic Business Council for
Sustainable Development where
TITAN Greece holds the President's
position. As of 2018, TITAN is a
member of the Global Cement and
Concrete Association (GCCA).
IAR 2021
Understanding TITAN and Management report. In specific: Message from the Chairman
of the BoD, Message from the Chairman of the Group Executive Committee,
Understanding TITAN (Our business approach in a changing global landscape, Creating
and Sharing Value, Focusing on Material Issues), ESG performance Review and ESG
performance statements: Table 1, ESG Performance KPIs, Table 2.5.3, and Table 2.5.4
TITAN Website: Sustainability, and Corporate Governance/Group Policies
Corporate
sustainability
governance and
leadership
The Ten principles of
the United Nations
Global Compact
Criterion 19
The CoP describes CEO
commitment and leadership
Criterion 20
The CoP describes Board
adoption and oversight
Criterion 21
The CoP describes
stakeholder engagement
Corporate social responsibility is one
of TITAN’s corporate values and
underlines its enduring commitment
to engage with stakeholders for
sustainable development. TITAN CSR
policy focus on understanding
material issues for key stakeholders
and delivering value for all, using
available resources.
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Scope Principle Criteria for GC Advanced Level TITAN Approach TITAN Reference
TITAN Group has no core business
operations in countries or areas
identified as high-risk conflict-
affected
IAR 2021
Understanding TITAN and Management report. In specific: Message from the Chairman
of the BoD, Message from the Chairman of the Group Executive Committee,
Understanding TITAN (Our business approach in a changing global landscape, Creating
and Sharing Value, Focusing on Material Issues), Corporate governance and risk
management, Performance highlights (Regional performance), ESG performance Review,
and ESG performance statements: Table 1, Table 2.5.3 and Table 2.5.4
General Notes
- See above, criteria 1-21
Additional Notes to the ESG performance statements:
1. TITAN does not operate in or near areas of conflict, according to data of the Uppsala
Conflict Data Program UCDP - see the web site: Uppsala Conflict Data Program (uu.se).
2. TITAN has completed an analysis of Materiality Assessment in 2020 for all countries of
operations, including a focus country research in each counrty by third party. The
country-level research concluded that no such matters of conflicts had emerged. No
new information on the subject matter was noted in the press/madia in any of the
countries of our operations, in 2021.
3. TITAN followed a thorough process of addressing Material Issues in all countries of
operations in 2020, under the Materiality Analysis and Assessment for all BUs. This
process enabled the engagement of TITAN's management in each country, and the due
diligence on BUs level with respect to human rights and indigenous peoples' rights. In
2021 TITAN prepared the 'blueprint' of a new campaign for receiving direct feedback
from our key stakeholders in each country, in specific for the material issues
prioritization for each BU. The survey is planned to be implemented in 2022 and the
outcomes will be part of the TITAN IAR 2022.
4. TITAN operated in 2021 a dedicated Group e-platform to record our community
initiatives and actions as well as to facilitate their self-assessment and align with our
priorities. Community engagement plans are impemented in all countries where we
operate, covering programs of initiatives for contributing to the engagement with local
stakeholders, and with long-term positive impacts for our communities. See section
Social Positive Impact in the Management Report for the assessment of TITAN's
community engagehhment initiatives across all countries or operations.
The above disclosures (Notes 1-4) cover the requirements for reporting according to the
SASB Standards for 'Security, Human Rights and Rights of Indigenous Peoples' and in
more specific the metrics (KPIs) EM-MM-210a.1, EM-MM-210a.2, and EM-MM-210a.3.
5. Concerning the SASB Standards under the area of 'Business Ethics and Transparency'
and in specific the metric (KPI) 'EM-MM-510a.2' see Table 4. "Transparency International -
Corruption Perception Index 2021".
TITAN Website: Sustainability, and Corporate Governance/Group Policies
Business and
peace
The Ten principles of
the United Nations
Global Compact
Criterion22
The CoP describes policies
and practices related to the
Company’s core business
operations in high-risk
conflict-affected areas
stewardship
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ESG PERFORMANCE REVIEW
Country CPI 2021 rank CPI 2020 rank
Change in rank
2
USA
1
27 25
Ÿ
Greece 58 59
ź
Bulgaria 78 69
Ÿ
Kosovo 87 104
ź
North Macedonia 87 111
ź
Turkey 96 86
Ÿ
Brazil
1
96 94
Ÿ
Serbia
1
96 94
Ÿ
Albania 110 104
Ÿ
Egypt 117 117
1RFKDQJHLQ
4. Transparency International - Corruption Perception Index 2021
Countries with TITAN key operations sorted by Transparency International CP Index 2021
Notes
1. According to the above Table there were no operations of TITAN's subsidiaries in countries with lower ranking than Egypt, in 2020. There were in total 58
countries which ranked lower, in positions between 123 and 179 in 2021. Please note that in the cases of: Brazil, Serbia, and USA, the CPI 2021 rank was higher
(deteriorated) compared to the CPI 2020 rank, although the respective figures for the CPI scoring remained unchanged for these specific countries. This
disclosure covers the requirements for reporting according to the SASB Standards for "Business Ethics and Transparency" and in more specific the metric (KPI)
EM-MM-510a.2 Production in countries that have the 20 lowest rankings in Transparency International’s Corruption Perception Index.
2. Symbols for the change in rank explained:
▼ Improving conditions in the country reflected by the decrease of rank
▲ Deteriorating conditions in the country reflected by the increase of rank
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INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
142
Thessaloniki cement plant, Greece
142
143143
Albania plant, in Tirana
143143143143143
MANAGEMENT REPORT
financial
review
An overview of our financial performance and our financial
statements.
144
MANAGEMENT REPORT
FINANCIAL REVIEW
Financial performance overview
Review of the year 2021
TITAN Cement Group generated record revenues of €1,714.6
million, up 6.7% from 2020, reflecting higher demand and a
supportive pricing environment. Due to the unexpected spike of
input costs in the second semester and despite pricing initiatives
that partly alleviated the burden, Earnings Before Interest,
Tax, Depreciation and Amortization (EBITDA) declined by 3.6%
to €275.2 million. Net Profit after Taxes and minorities (NPAT)
climbed to €91.9 million (vs €1.1 million in 2020 and €50.9 million
in 2019). This significant increase was the result of lower finance
costs, more favourable FX movements and a lower effective tax
rate. It should be noted that in 2020 there were €63.9 million one-
off charges related to Egypt. Thanks to a successful refinancing
strategy the Group lowered significantly its finance costs for a
third consecutive year to €33.6 million (€19.0 million lower than
2020 and €30.0 million lower than 2019).
Delivery was strong across all Group markets: US operations
marked a new milestone with sales revenue at record
levels thanks to growing demand, underpinned by healthy
macroeconomic conditions. In Greece, the market continued its
positive performance, lending further support to the belief that
demand is solidly in the upward path of the business cycle. In
Southeastern Europe performance was robust. Performance in
the Eastern Mediterranean turned positive, thanks to the mix
of demand pick-up and better pricing dynamics in Egypt, while
in Turkey, despite the volatile economic situation, the Group
recorded revenue growth as well. Finally, our Brazilian operations
continued to grow significantly.
Trends in domestic sales volumes were positive across all regions,
testifying to strong market fundamentals. At Group level, volumes
increased across all product lines: cement, ready-mix concrete,
aggregates, building blocks and fly ash. Group cement sales
increased by 7% compared to 2020, reaching 18.3 million tons,
with US being the main contributor of this increase. Ready-mix
concrete sales increased by 2% in 2021, reaching 5.5 million m³
on the back of stronger sales in US and Greece. Aggregates' sales
increased by 1% reaching 20.2 million tons, thanks to the strength
of the Greek market.
Regional review of the year 2021
2021 was a year of record sales for Titan America. Consumption
in our markets grew considerably above the US average, as our
customers saw their activities expanding and their backlogs
increasing. Sales of cement, ready-mix, concrete blocks and fly ash
increased, while aggregates sales were maintained at high levels.
Activity in Florida benefits as the state develops into a vibrant
business and financial center, while augmented internal migration
trends are generating an increase in housing demand and
attendant non-residential construction. Cement consumption also
grew in the Mid-Atlantic with business performance being driven
by the increased volumes generated by strong residential demand
and cement-intensive public works projects.
The New York Metropolitan area and New Jersey, also saw cement
consumption increase, allowing our import terminal to expand
its sales, though higher import freight costs negatively affected
its profitability. Considering the strength of the US market and
its positive outlook, the Group initiated an ambitious investment
program, aimed at expanding the effective supply capacity
of its operations and at achieving efficiencies in logistics and
production, in order to capture growth.
Revenue for TITAN’s US operations increased compared to 2020
reaching $1.2 billion, an increase of 8.6% year on year. In euro
terms, revenue increased by 4.7% to €983.6 million. EBITDA
reached €158.0 million, a decline of 10.5% compared to 2020
(-6.8% in US $ terms) as operational profitability was constrained
by global cost headwinds and supply chain disruptions which
reflected negatively on import freight, energy, logistics and labor
costs.
In Greece, cement demand continued to grow at a strong rate,
similar to the one recorded in 2020, driven by the increased
levels of activity in public and municipal infrastructure projects,
as well as growth in residential construction and broader real
estate and logistics projects. Tourism activity also picked up,
following the slowdown caused by the pandemic. Cement exports
remained strong, with the US representing Greece’s biggest
export destination. Profitability was nevertheless impacted by the
unexpected steep rise in energy and transportation costs in the
second half of the year. The Group was able to partly mitigate the
effect through product price increases implemented in Q4, with
the notable increase in alternative fuel utilization and by further
operational efficiencies that resulted from an increased number of
digitalization projects across our plants.
Total revenue for Greece and Western Europe in 2021 increased by
9.4% to €267.6 million while EBITDA increased by €7.4 million to
€23.6 million.
Performance in Southeastern Europe was again solid, driven
by higher demand and improved pricing. Overall, it was the
residential and private commercial works which formed the key
sources of demand. The Group continued investing in expanding
plant operational efficiency, with two of them reaching more than
10-year production records. Despite the strength of the market
and successful price increases earlier in the year, the increase in
electricity and fuel costs, which surged especially in the second
half of the year, inevitably softened profitability.
Revenue for the region overall increased by 7.3% reaching €290.6
million while EBITDA declined by 14.8% versus 2020 reaching €81.9
million, however still above the profitability of 2019.
The Eastern Mediterranean region saw a return to positive
performance in 2021 amidst continued demand growth, despite
the local macroeconomic uncertainties.
In Egypt, cement demand started to recover after four years, as
a result of stronger construction activity coming from national
infrastructure projects and construction of affordable housing.
Cement consumption reached 48.5 million tons posting a 6%
increase. Moreover, the market regulation agreement set by the
Egyptian government on all cement producers in July 2021, has
narrowed the gap between supply and demand, leading selling
prices to much healthier levels. Group volumes grew and our
plants also focused on operational excellence and digitization
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INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
projects, while also exploring new growth opportunities mainly in
export markets.
In Turkey, despite the volatile economic environment
characterized by a 65% depreciation of the local currency, soaring
inflation of 36% and a contraction in household real income, the
economy grew by 9% in 2021, supported by the continuous credit
expansion following a series of rate cuts by the Central bank.
Domestic cement demand strengthened by 7%, reaching nearly 60
million tons, still approximately 15% below the peak levels of 2017.
Group volumes reflected this upward trend, as demand continued
to grow for private housing, public works in infrastructure
projects, as well as exports.
Following a few years of weak performance and despite the
macroeconomic uncertainties, the Eastern Mediterranean region
recorded total revenue of €172.8 million, an increase of 13.9%
from 2020. EBITDA was €11.8 million versus a €3.3 million loss in
2020, reflecting a significant improvement in the EBITDA margin,
despite the sharp depreciation of the Turkish Lira.
In Brazil the improved economic environment led to stronger
construction activity and cement demand grew for a third
consecutive year. In the second half of 2021 however, the market
witnessed a slight slowdown as inflationary pressures started to
mount and interest rates increased.
Our joint venture Apodi increased its sales volumes at a higher
rate than the national average by continuing to penetrate the
bulk cement segment, with a focus on the pre-cast industry, the
growing regional wind park sector and projects in the renovation
and expansion of infrastructure such as the Fortaleza airport. As
a result, Apodi posted a significant increase in revenue to €83.8
million vs €70.7 million in 2020, while net profit attributable to
TITAN Group reached €2.7 million compared to €2.6 million in
2020, posting a 4.6% increase.
Financing and Investments
In 2021, Group Operating Free Cash Flow reached €104.7 million
versus €225.3 million in 2020. Lower OFCF was primarily due to
higher capital expenditures by €41.8 million from the catch-up
of the 2020 COVID-19 -restrained investment program, higher
working capital needs by €48.9 million resulting from stronger
business activity and higher levels of fuel inventories. Group
capital expenditures during the year reached €126.0 million
compared to €84.3 million in 2020, with most of the funding
directed to investments focusing on production efficiencies,
improved logistics capacities and reduction of carbon footprint.
Moreover, the final tranche of €40.8 million were paid to IFC
for the acquisition of their minority stakes held in the Group's
activities in Southeastern Europe and Egypt.
In the prevailing low interest environment, the Group took a
number of initiatives and succeeded in both lowering its finance
costs and extending the debt maturity profile. Year-end net debt
increased to €713.2 million (2020: €684.4 million), following the
repayment of a €163.5 million outstanding bond and the conscious
reduction of cash balances. Net Debt/EBITDA ratio came at 2.61x.
The next significant maturities are a bond of €350 million
maturing in November 2024 and another of €250 million maturing
in mid-July 2027.
In December 2021, Standard & Poor’s affirmed its rating for Titan
Cement International of ‘BB” with a stable outlook.
Resolutions of the Board of Directors
• Cancellation of Treasury Shares
In June 2021 TITAN Group cancelled 4,122,393 own shares held as
Treasury stock, representing 5% of the voting rights. Following
this transaction, the share capital of Titan Cement International
amounts to €1,159,347,807.86 and is represented by 78,325,475
shares.
• Share buy-back
In October 2021, the Board decided to implement a share buy-back
programme of up to an amount of €10 million for a duration of up
to 6 months. Until the end of 2021, 230,141 shares were purchased
on Euronext Brussels and the Athens Exchange (ATHEX) for a total
consideration of €3.2 million. On December 31st, the Group owned
treasury shares representing 1.91% of the voting rights.
• Initiation of a new share buy-back programme
In March 2022, given the latest market developments, the Board
decided to implement a new share buy-back programme. The new
programme will begin on or around April 1, 2022, following the
end of the current running programme. The new share buy-back
programme will be up to €10 million and will have a duration
of up to six months. TCI will keep the market fully informed of
the progress of the relevant transactions in line with applicable
regulations.
• Return of Capital
Following the authorization granted to the Board of Directors
by the Extraordinary Meeting of the Company's Shareholders on
13 May 2019, the Board decided the return of capital of €0.50 per
share to all the Shareholders of the Company. All shareholders who
are recorded as shareholders on Thursday, 28 April 2022, at 12.00
midnight (CEST) (record date) will be entitled to receive the capital
return. Shareholders will receive the payment of the capital return
on Tuesday, 5 July 2022, through their custodians, banks, and
securities brokers.
Outlook
The current military conflict after the Russian invasion in the
Ukraine creates geopolitical uncertainties with macroeconomic
implications the extent of which cannot yet be assessed.
TITAN Group has no exposure to Ukraine, Russia or affected
regions. Nevertheless, the effect on the Group’s businesses
from developments in the energy sector and the broader macro
implications are anticipated to impact market trends and further
increase inflation risks.
In the US, despite macroeconomic risks, the underlying
construction market dynamics remain strong. Residential activity
continues to reflect the country’s housing deficit with both
the multi- and single-family segments driving demand. The
146
infrastructure segment is poised to provide a steady backbone
to demand from 2023 onwards, as the full effect of America’s
large infrastructure investment drive starts to materialize on the
ground. Cost pressures are expected to persist and the Group will
continue to address global cost headwinds by adjusting pricing, as
evidenced already by the successful price increase implemented
in January in both Florida and mid-Atlantic and by the recently
announced second round of price increases in Florida. At the same
time, TITAN initiated an investment program to significantly grow
its effective capacity. This centers around the transformation
and expansion of the import terminals in Tampa, Florida and in
Norfolk, Virginia, including the $60 million construction of two
new storage domes. Several other investments and initiatives are
in progress aiming to achieve logistics and production efficiencies,
which will effectively allow the Group to capture the market’s
upside for several years ahead and to improve flexibility and
customer service. Concurrently, TITAN America is building on
its head start with the full adoption of lower carbon footprint
cements across its operations.
The impact of the ongoing war in the Ukraine may lead to more
uncertainties in Europe overall. There is a negative impact
already on the energy sector, the severity of which, as well as the
duration, cannot yet be assessed. The European economies are
entering a difficult phase, with increased risks of rising inflation
and a slowdown of economic growth.
In Greece, demand growth in the residential segment looks set
to continue from a low base, with the larger urban centers which
our plants primarily serve, holding the lion’s share of growth. The
infrastructure pipeline is ripe with projects scaling up and offering
a backlog timeline for the years ahead. The Group is continuing
its efforts on all fronts to manage its cost base and minimize
its carbon footprint. Alternative fuel utilization is constantly
increased, supported by investments in both the Kamari and
Thessaloniki plants. The Group is continuing with the roll-out of
more environmentally friendly cement products with lower clinker
content.
Southeastern Europe should continue delivering satisfactory
returns, driven primarily by residential and light commercial
development, as well as select infrastructure projects, depending
on the country. Cost challenges will persist but the Group
continues its efforts unabated to address inflationary pressures
and mitigate their impact on operational profitability. Alternative
fuel utilization is increasing, as is the promotion of new products
with lower carbon emissions throughout our regional presence.
In Egypt the economy is growing driven by large infrastructure
projects and the country’s increased LNG exports. Trends
of cement demand are positive going forward and the new
balance between supply and demand favors a healthier pricing
environment. The Group is well-placed to benefit from market
dynamics and alternative fuel utilization has been increasing,
aiming to both address costs as well as ameliorate the Group’s
carbon footprint.
The situation remains challenging in Turkey, exacerbated by the
geopolitical turbulence on the Black Sea. The outlook for the
construction sector is highly dependent on the fortunes of the
economy which remains under stress. Successful price increases
manage to address the inflationary pressures while increased
export volumes provide an outlet for the Group.
In Brazil, while high commodity prices and the country’s trade
surplus should support the economy, global inflationary pressures,
in an election year, make for a very delicate macroeconomic
setting.
In 2022, we will continue to harness the advantages offered
by decarbonization, digital transformation and business model
innovation to benefit our customers, employees, suppliers,
and communities, aspiring to deliver to society carbon-neutral
concrete by 2050.
Treasury shares
Following the decision of the Extraordinary General Meeting
of Shareholders dated 13 May 2019 which authorized the Board
of Directors to acquire and dispose Company’s own shares in
accordance with the provisions of article 7:215 ff of the Belgian
Companies and Associations Code, in October 2021, the Board
decided to implement a share buy-back program of up to a
maximum amount of €10 million for a duration of up to 6 months.
The Company kept the market fully informed of the progress of the
relevant transactions as provided by the applicable regulations.
In implementation of this program, during the period from October
14, 2021 until December 31, 2021, the Company acquired directly
90,948 own shares and indirectly through its subsidiary Titan
Cement Company S.A. 139,193 shares, representing 0.12% and
0.18% respectively of the share capital of the Company. The total
value of these transactions amounted to €3,229,701. On 31.12.2021
the Company holds 412,173 own shares representing 0.53% of the
Company’s share capital and Titan Cement Company S.A. (Titan
SA), a direct subsidiary of the Company, holds 1,084,976 shares of
the Company, representing 1.38% of the Company’s voting rights.
Sale of treasury stock in the framework of Stock Option
Plans
Titan S.A., a direct subsidiary of the Company, sold in 2021 to Titan
Group employees, in implementation of existing stock option
plans, 123,101 shares of the Company, representing approximately
0.16% of the share capital of the Company, for a total amount of
€1,231,010 (i.e.€10/Company share).
Going concern disclosure
The Board of Directors having taken into account:
a. the Company’s financial position;
b. the risks facing the Company that could impact on its business
model and capital adequacy; and
c. the fact that no material uncertainties are identified to the
Company’s ability to continue as a going concern in the
foreseeable future and in any event over a period of at least
twelve months from the date of approval of the Financial
Statements
state that they consider it appropriate for the Company to
continue to adopt the going concern basis in preparing its
Financial Statements and that no material uncertainties are
identified to the Company’s ability to continue to adopt the
going concern basis in preparing its Financial Statements in the
foreseeable future and in any event over a period of at least twelve
months from the date of approval of the Financial Statements for
the fiscal year 2021.
MANAGEMENT REPORT
FINANCIAL REVIEW
147
Viability statement
The Board of Directors have assessed the prospects of the
Company having regard on its current position and the major
risks facing the Company over a period of five years, which was
considered as appropriate to draw conclusions. The Board of
Directors have a reasonable expectation that the Company will
be able to continue in operation and meet its liabilities as they fall
due over the period of their assessment.
Annual report of the board of directors and financial
accounts for the fiscal year 2021
The Board of Directors considers that the Annual Report and the
Financial Accounts for the fiscal year 2021, taken as a whole, are
fair, balanced and understandable and provide the information
necessary for shareholders to assess the Company’s performance,
business model and strategy.
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
148
MANAGEMENT REPORT
FINANCIAL REVIEW
Financial statements
The Annual Consolidated Financial Statements presented on the following pages were approved by the Board of Directors on 7
th
of April
2022.
Chairman of the Board of Directors Managing Director and Group CFO
Efstratios-Georgios Arapoglou Michael Colakides
Company CFO Financial Consolidation Director
Grigorios Dikaios Athanasios Danas
149
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
Consolidated Income Statement
(all amounts in Euro thousands)
Notes
2021 2020
Restated*
Revenue 3 1,714,623 1,607,033
Cost of sales
5 -1,403,728 -1,297,763
Gross profit 310,895 309,270
Other operating income
4.i 10,728 7,552
Administrative expenses
5 -153,951 -143,046
Selling and marketing expenses
5 -26,391 -24,278
Net impairment losses on financial assets
20 -1,722 -1,985
Other operating expenses
4.i -831 -1,485
Operating profit before impairment losses on goodwill
3 138,728 146,028
Impairment losses on goodwill
13 - -46,614
Operating profit 138,728 99,414
Other income
4.ii - 100
Finance income
6.i 4,255 636
Finance expenses
6.ii -37,835 -53,197
Loss from foreign exchange differences
6.iii -73 -13,216
Share of profit of associates and joint ventures
15 3,291 3,200
Profit before taxes 108,366 36,937
Income tax
8 -16,811 -35,777
Profit after taxes 91,555 1,160
Attributable to:
Equity holders of the parent 91,923 1,126
Non-controlling interests -368 34
Basic earnings per share (in €)
9 1.2290 0.0146
Diluted earnings per share (in €)
9 1.2242 0.0145
The primary financial statements should be read in conjunction with the accompanying notes.
Year ended 31 December
*Restated due to change in accounting policy (note 1)
150
(all amounts in Euro thousands)
Notes
2021 2020
Restated*
Profit after taxes 91,555 1,160
Other comprehensive income:
Items that may be reclassified to income statement
Exchange gains/(losses) on translation of foreign operations 35 6,602 -121,042
Currency translation differences on transactions designated as part of net investment in foreign
operation
Gains/(losses) on cash flow hedges
35 3,093 -48
Reclassification to income statement
35 -1,723 -
Income tax relating to these items
18 -1,009 1,150
Items that will not be reclassified to income statement
Asset revaluation surplus
Effect due to changes in tax rates
18 263 -
Re-measurement gains on defined benefit plans
25 1,240 30
Share of other comprehensive losses of associates and joint ventures
-5 -15
Income tax relating to these items
18 -372 -41
Other comprehensive income/(loss) for the year net of tax 14,038 -124,768
Total comprehensive income/(loss) for the year net of tax 105,593 -123,608
Attributable to:
Equity holders of the parent 113,625 -116,791
Non-controlling interests -8,032 -6,817
Year ended 31 December
The primary financial statements should be read in conjunction with the accompanying notes.
Consolidated Statement of Comprehensive Income
*Restated due to change in accounting policy (note 1)
MANAGEMENT REPORT
FINANCIAL REVIEW
151
(all amounts in Euro thousands)
31/12/2021 31/12/2020 01/01/2020
Notes Restated* Restated*
Assets
Property, plant and equipment 11 1,545,382 1,529,243 1,694,725
Investment properties
12 10,980 11,720 11,628
Goodwill
13 271,986 268,013 344,523
Intangible assets
14 91,444 84,279 85,170
Investments in associates and joint ventures
15 88,753 85,610 113,858
Derivative financial instruments
36 2,488 2,291 -
Receivables from interim settlement of derivatives
36 6,185 - 12,937
Other non-current assets
17 18,556 16,957 15,436
Deferred tax assets
18 8,867 12,464 11,453
Total non-current assets 2,044,641 2,010,577 2,289,730
Inventories
19 305,131 248,586 283,519
Receivables and prepayments
20 236,344 185,247 186,565
Income tax receivable 1,611 4,744 5,657
Derivative financial instruments
36 1,715 16,462 1,245
Receivables from interim settlement of derivatives
36 9,079 4,142 3,829
Cash and cash equivalents
21 79,882 206,438 90,388
Total current assets 633,762 665,619 571,203
Assets held for sale
11 238 - -
Total Assets 2,678,641 2,676,196 2,860,933
Equity and Liabilities
Equity and reserves attributable to owners of the parent 22,23 1,321,626 1,251,362 1,383,035
Non-controlling interests
15.3 15,260 23,994 34,626
Total equity (a) 1,336,886 1,275,356 1,417,661
Long-term borrowings
32 641,461 628,172 776,694
Long-term lease liabilities
33 46,004 38,821 46,126
Derivative financial instruments
36 6,185 - 11,084
Payables from interim settlement of derivatives
36 1,070 2,291 -
Deferred tax liability
18 113,604 102,078 96,319
Retirement benefit obligations
25 22,063 22,824 24,912
Provisions
26 56,001 49,550 39,456
Non-current contract liabilities
27 1,692 1,991 -
Other non-current liabilities
27 12,849 9,864 47,193
Total non-current liabilities 900,929 855,591 1,041,784
Short-term borrowings
32 89,242 205,656 90,140
Short-term lease liabilities
33 16,378 18,194 17,030
Derivative financial instruments
36 8,742 5,113 2,692
Payables from interim settlement of derivatives
36 - 12,957 1,092
Trade and other payables
28 302,611 278,370 260,009
Current contract liabilities
28 9,998 8,215 13,580
Income tax payable 1,544 4,054 3,251
Provisions
26 12,311 12,690 13,694
Total current liabilities 440,826 545,249 401,488
Total liabilities (b) 1,341,755 1,400,840 1,443,272
Total Equity and Liabilities (a+b) 2,678,641 2,676,196 2,860,933
The primary financial statements should be read in conjunction with the accompanying notes.
Consolidated Statement of Financial Position
*Restated due to change in accounting policy (note 1)
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
152
(all amounts in Euro thousands)
Ordinary shares Share premium Share options
Ordinary
treasury shares
Balance at 1 January 2020 1,159,348 5,974 4,904 -117,139
Change in accounting policy (note 1) - - - -
Restated balance at 1 January 2020 1,159,348 5,974 4,904 -117,139
Restated profit for the year - - - -
Restated other comprehensive loss
Total comprehensive (loss)/income for the year - - - -
Deferred tax on treasury shares held by subsidiary - - - -
Distribution of reserves (note 10) - - - -
Dividends distributed - - - -
Purchase of treasury shares (note 22) - - - -8,816
Sale - disposal of treasury shares for option plan (note 22) - - - 1,835
Share based payment transactions (note 24) - - 1,720 -
Deferred tax adjustment due to change in income tax rates on revaluation
reserves (note 18)
Acquisition of non-controlling interest
Transfer among reserves (note 23)
Restated Balance at 31 December 2020 1,159,348 5,974 5,307 -124,120
Restated balance at 1 January 2021 1,159,348 5,974 5,307 -124,120
Profit for the year
Other comprehensive income/(loss) - - - -
Total comprehensive income/(loss) for the year - - - -
Cancellation of treasury shares
Deferred tax on treasury shares held by subsidiary
Distribution of reserves (note 10)
Dividends distributed - - - -
Purchase of treasury shares (note 22) - - - -3,230
Sale - disposal of treasury shares for option plan (note 22) - - - 2,757
Share based payment transactions (note 24) - - 886 -
Tax expenses due to share capital transactions - - - -
Deferred tax adjustment on revaluation reserves (note 18)
Withholding tax on dividend distribution of subsidiaries - - - -
Acquisition of non-controlling interest - - - -
Transfer among reserves (note 23)
Balance at 31 December 2021 1,159,348 5,974 3,913 -31,773
The primary financial statements should be read in conjunction with the accompanying notes.
Consolidated Statement of Changes in Equity
Attributable to equity holders of the parent
MANAGEMENT REPORT
FINANCIAL REVIEW
153
Other reserves
(note 23) Retained earnings Total
Non-controlling
interests Total equity
-744,764 1,066,842 1,375,165 34,626 1,409,791
-743,381 1,073,329 1,383,035 34,626 1,417,661
-117,917 - -117,917 -6,851 -124,768
-117,917 1,126 -116,791 -6,817 -123,608
-15,414 - -15,414 - -15,414
-6,116 7,433 - - -
-875,492 1,080,345 1,251,362 23,994 1,275,356
-875,492 1,080,345 1,251,362 23,994 1,275,356
-65,318 -27,502 - - -
-9,610 - -9,610 - -9,610
-30,780 - -30,780 - -30,780
-213 - -213 - -213
-207,001 209,281 - - -
-1,166,698 1,350,862 1,321,626 15,260 1,336,886
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
154
(all amounts in Euro thousands)
Notes
2021 2020
Restated*
Cash flows from operating activities
Profit after taxes 91,555 1,160
Depreciation, amortization and impairment of assets
29 136,481 186,181
Interest and related expenses
29 35,972 48,397
Other non-cash items
29 10,733 68,390
Changes in working capital
29 -43,978 5,474
Cash generated from operations 230,763 309,602
Income tax paid -12,172 -10,176
Net cash generated from operating activities (a) 218,591 299,426
Cash flows from investing activities
Payments for property, plant and equipment 11,12 -118,910 -76,787
Payments for intangible assets
14 -7,134 -7,509
Proceeds/(payments) of share capital decrease/(increase) in associates and joint ventures 336 -355
Payments for acquisition of subsidiaries, net of cash acquired
16 -45 -330
Proceeds from sale of PPE, intangible assets and investment property
29 8,694 3,110
Proceeds from dividends
Interest received 535 559
Net cash flows used in investing activities (b) -115,590 -78,863
Net cash flows after investing activities (a)+(b) 103,001 220,563
Cash flows from financing activities
Acquisition of non-controlling interests -40,814 -21,795
Payments due to share capital decreases -767 -
Dividends paid and share capital returns -31,985 -17,615
Payments for shares purchased back
22 -3,230 -8,816
Proceeds from sale of treasury shares
22 1,231 779
Payments for financial assets designated at FVTPL
36 -50 -
Interest and other related charges paid
34 -36,153 -49,917
Proceeds from borrowings and derivative financial instruments
34 243,129 478,398
Payments of borrowings and derivative financial instruments
34 -347,968 -459,932
Principal elements of lease
34 -16,309 -15,967
Net cash flows used in financing activities (c ) -232,916 -94,865
Net (decrease)/increase in cash and cash equivalents (a)+(b)+(c) -129,915 125,698
Cash and cash equivalents at beginning of the year
21 206,438 90,388
Effects of exchange rate changes 3,359 -9,648
Cash and cash equivalents at end of the year 21 79,882 206,438
*Restated due to change in accounting policy (note 1)
The primary financial statements should be read in conjunction with the accompanying notes.
Year ended 31 December
Consolidated Cash Flow Statement
MANAGEMENT REPORT
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INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
156
Contents
Page
1. Corporate information and summary of
significant accounting policies
157
1.1 Basis of preparation 157
1.2 Consolidation 159
1.3 Foreign currency translation 161
1.4 Property, plant and equipment 161
1.5 Investment properties 162
1.6 Goodwill and intangible assets (other than
goodwill)
162
1.7 Deferred stripping costs 163
1.8 Impairment of non-financial assets other
than Goodwill
163
1.9 Leases 163
1.10 Inventories 164
1.11 Trade receivables 164
1.12 Cash and cash equivalents 164
1.13 Share capital 164
1.14 Borrowings 164
1.15 Current and deferred income taxes 165
1.16 Employee benefits 165
1.17 Government grants 166
1.18 CO₂ Emission rights 166
1.19 Provisions and contingencies 166
1.20 Site restoration, quarry rehabilitation and
environmental costs
167
1.21 Revenue 167
1.22 Dividend distribution 167
1.23 Segment information 167
1.24 Financial assets 168
1.25 Offsetting financial instruments 168
1.26 Impairment of financial assets 168
1.27 Derivative financial instruments and hedging
activities
168
1.28 De-recognition of financial assets and
liabilities
169
1.29 Borrowing costs 170
1.30 Trade payables 170
1.31 Gains/losses on disposal of non-current assets,
restructuring costs and other significant gains/
losses
170
2. Significant accounting estimates and
judgments
170
2.1 Impairment of goodwill 170
2.2 Impairment of joint ventures 170
2.3 Deferred tax assets 170
2.4 Useful lives and residual values 170
2.5 Provision for environmental rehabilitation 170
3. Operating segment information 171
4. Other income and expenses 173
Page
5. Expenses by nature 174
6. Net finance costs and foreign exchange
differences
174
7. Staff costs 174
8. Income tax expense 175
9. Earnings per share 176
10. Dividends and return of capital 176
11. Property, plant and equipment 177
12. Investment property 179
13. Goodwill 180
14. Intangible assets 182
15. Investments in associates, joint ventures
and subsidiaries
183
16. Principal subsidiaries, associates and joint
ventures
186
17. Other non-current assets 188
18. Deferred income taxes 188
19. Inventories 192
20. Receivables and prepayments 192
21. Cash and cash equivalents 193
22. Share capital and premium 194
23. Other reserves 195
24. Share-based payments 197
25. Retirement and termination benefit
obligations
199
26. Provisions 202
27. Other non-current liabilities and non-current
contract liabilities
203
28. Trade payables, other liabilities and current
contract liabilities
203
29. Cash generated from operations 204
30. Contingencies and commitments 204
31. Related party transactions 206
32. Borrowings 207
33. Leases 208
34. Changes in liabilities arising from financing
activities
209
35. Financial risk management objectives and
policies
210
36. Financial instruments and fair value
measurement
215
37. Fiscal years unaudited by tax authorities 217
38. COVID-19 implications 217
39. Events after the reporting period 218
MANAGEMENT REPORT
FINANCIAL REVIEW
157
1. Corporate information and summary
of significant accounting policies
corporate registration number is 0699.936.657 and its registered
address is Rue de la Loi 23, 7th floor, box 4, 1040 Brussels, Belgium ,
while it has established a place of business in the Republic of
on Euronext Brussels, with a parallel listing on Athens Stock
exchange and Euronext Paris.
Information on the Group’s structure is provided in note 16.
These consolidated financial statements were authorized for issue
by the Board of Directors on 7 April 2022.
Summary of significant accounting policies
The principal accounting policies adopted in the preparation of
these financial statements are set out below:
1.1 Basis of preparation
These consolidated financial statements have been prepared
in accordance with International Financial Reporting Standards
(IFRS), as issued by the International Accounting Standards Board
(IASB) and as adopted by the European Union and interpretations
(IFRIC) issued by the IFRS Interpretations Committee.
The preparation of financial statements, in conformity with IFRS,
requires the use of certain critical accounting estimates. It also
requires management to exercise its judgment in the process
of applying the accounting policies. The areas involving a higher
degree of judgment or complexity, or areas where assumptions
and estimates are significant to the financial statements are
disclosed in significant accounting estimates and judgments in
note 2.
They have also been prepared on historical cost basis, except
for investment properties, certain financial assets and liabilities
(including derivative instruments) and plan assets of defined
benefit pension plans measured at fair value. The consolidated
financial statements are presented in euros and all values are
rounded to the nearest thousand (€000), except when otherwise
indicated.
In addition, they have been prepared with the same accounting
policies of the prior financial year, except for the application of
IFRIC Agenda Decision IAS 19 – Attributing Benefit to Periods of
Service (May 2021) and the adoption of new or revised standards,
amendments and/or interpretations that are mandatory for the
periods beginning on or after 1 January 2021.
1.1.1 Application IFRIC Agenda Decision IAS 19 – Attributing
Benefit to Periods of Service
On May 24, 2021, the IFRS Interpretations Committee (IFRIC)
published its Agenda Decision, Attributing Benefit to Periods of
Service (IAS 19 Employee Benefits) and concluded that an entity’s
obligation increases until the date when future service by the
employee will lead to no material amounts of further benefits.
As such, each year of service between age 46 and age 62 leads to
further benefits. Prior to age 46 and after age 62 no further benefit
accrues. Consequently, the entity attributes the retirement
benefit to each year in which the employee renders service from
the age of 46 to the age of 62.
In accordance with the aforementioned decision, the application
of the basic principles of IAS 19 in Greece has been changed. Group
entities, which calculated retirement obligations form recruitment
until the date when further service by the employee would lead
to no material amount of further benefits under the retirement
plans, other than from further salary increases, have adjusted
their calculations with the decision and recognized retirement
obligations for the last 16 years of service until retirement.
The application of the IFRIC Agenda Decision is a change in the
accounting policy that is applied retrospectively according to
paragraphs 19-22 of IAS 8. The affected entities adjusted the
opening balance of each related component of equity and the
other comparative amounts disclosed for 2020, as if the new
accounting policy had always been applied.
The effect of the change in the accounting policy is as follows:
Impact on the consolidated statement of financial position
(increase/(decrease)) - all amounts in Euro thousand:
31.12.2020 1.1.2020
Deferred tax assets -2,737 -2,486
Total Assets -2,737 -2,486
Equity and reserves attributable to
owners of the parent
8,669 7,870
Non-controlling interests 4 -
Total Equity (a) 8,673 7,870
Retirement benefit obligations -11,410 -10,356
Total Liabilities (b) -11,410 -10,356
Total Equity and Liabilities (a)+(b) -2,737 -2,486
Impact on the consolidated income statement (increase/
(decrease)) - all amounts in Euro thousand:
31.12.2020
Cost of sales -213
Gross profit -213
Administrative expenses -386
Selling and marketing expenses -37
Operating profit -636
Finance expenses 122
Profit before taxes -514
Income tax 122
Profit after taxes -392
Attributable to:
Equity holders of the parent -392
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
158
Impact on basic and diluted earnings per share (EPS) (increase/
(decrease) in EPS) - all amounts in Euro:
31.12.2020
Basic earnings per share (in €) -0.0051
Diluted earnings per share (in €) -0.0051
Impact on the consolidated statement of comprehensive Income
(increase/(decrease)) - all amounts in Euro thousand:
31.12.2020
Profit after taxes -392
Re-measurement losses on defined benefit plans 1,568
Income tax relating to these item -374
Other comprehensive income for the year net
of tax 1,194
Total comprehensive income for the year net
of tax 802
Attributable to:
Equity holders of the parent 798
Non-controlling interests 4
1.1.2 The following new standards and amendments to
standards are mandatory for the first time for the financial
year beginning 1 January 2021 and have been endorsed by the
European Union:
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 Interest
Rate Benchmark Reform – Phase 2 (effective 01/01/2021). These
amendments address issues that might affect financial reporting
after the reform of an interest rate benchmark, including its
replacement with alternative benchmark rates. The amendments
are effective for annual periods beginning on or after 1 January
2021, with earlier application permitted.
The Group adopted the amendments on the required effective
date. However, it continues to monitor the output from the
various industry working groups managing the transition to new
benchmark interest rates, including the announcements made
by the IBOR regulators as the reform is ongoing. On 31.12.2021,
the amendments had no impact on the consolidated financial
statements of the Group. The Group intends to use the practical
expedients in future periods if they become applicable.
Borrowings
On 31.12.2021, the total amount of the Group’s borrowings is
€730.7 million (note 32), from which €596.4 mil. are bonds of
fixed interest rate. The Group also has a floating interest rate
revolving facility agreement with available commitment of €208
million, which already includes adequate fall back provisions for a
cessation of the referenced benchmark interest rate. On 31.12.2021,
the outstanding balance of this facility is €28 million. Moreover,
it has local floating rate debt in Albania and Turkey. None of these
debt agreements include floating interest rates that are based
on IBORs. Finally, the Group’s subsidiary in USA, Titan America
LLC, maintains committed and uncommitted credit facilities with
banks of €33.3 million balance on 31.12.2021. The facilities provide
for loans at variable interest rates based on Libor and they include
adequate fall back provisions.
Derivatives
On 31.12.2021, the Group has recognised the following derivatives
in the statement of financial position (note 35):
1) Various short-term EUR/USD forward contracts, in order to
hedge foreign currency risk,
2) Cross currency interest rate swaps, in order to hedge foreign
currency exposure and exchange fixed Euro rates to fixed USD
rates,
3) Energy swap transactions, in order to hedge fluctuations of
natural gas and coal prices,
4) Various forward freight agreements, in order to hedge
fluctuations of freight rates and
5) Forward starting interest rate swaps, in order to hedge
variability to changes in the future interest payments.
None of the aforementioned derivatives are subjects to IBOR
reform.
Leases
On 31.12.2021, the total amount of the Group’s lease liabilities is
€62.4 million (note 33).
None of the Group’s lease contracts are based on IBORs and, as
a result, there will be no impact on the Group’s lease liability
balances.
Receivables
On 31.12.2021, the Group, through its subsidiary Titan America
LLC in USA, incorporates in its statement of financial position the
amount of €43.2 million, as interest-bearing note receivables (note
20). The note receivables are fixed-rate linked.
Amendment to IFRS 16 Leases Covid 19-Related Rent Concessions
(effective 01/06/2020, with early application permitted). If certain
conditions are met, the Amendment would permit lessees, as a
practical expedient, not to assess whether particular covid-19-
related rent concessions are lease modifications. Instead, lessees
that apply the practical expedient would account for those rent
concessions as if they were not lease modifications.
The Group has not received Covid-19-related rent concessions,
but plans to apply the practical expedient if it becomes applicable
within allowed period of application.
1.1.3 The following new amendments have been issued, is not
mandatory for the first time for the financial year beginning 1
January 2021 but have been endorsed by the European Union:
Amendment to IFRS 16 Leases Covid 19-Related Rent Concessions
beyond 30 June 2021 (effective 01/04/2021, with early application
permitted). The amendments extend, by one year, the May
2020 amendment that provides lessees with an exemption from
assessing whether a COVID-19-related rent concession is a lease
modification. In particular, the amendment permits a lessee to
apply the practical expedient regarding COVID-19-related rent
concessions to rent concessions for which any reduction in lease
payments affects only payments originally due on or before 30
June 2022 (rather than only payments originally due on or before
30 June 2021). The amendment is effective for annual reporting
periods beginning on or after 1 April 2021 (earlier application
permitted, including in financial statements not yet authorised for
issue at the date the amendment is issued).
MANAGEMENT REPORT
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Amendments to IFRS 3 Business Combinations; IAS 16 Property,
Plant and Equipment; IAS 37 Provisions, Contingent Liabilities
and Contingent Assets as well as Annual Improvements (effective
1 January 2022). The package of amendments includes narrow-
scope amendments to three Standards as well as the Board’s
Annual Improvements, which are changes that clarify the wording
or correct minor consequences, oversights or conflicts between
requirements in the Standards.
• Amendments to IFRS 3 Business Combinations update a
reference in IFRS 3 to the Conceptual Framework for Financial
Reporting without changing the accounting requirements for
business combinations.
• Amendments to IAS 16 Property, Plant and Equipment prohibit
a company from deducting from the cost of property, plant and
equipment amounts received from selling items produced while
the company is preparing the asset for its intended use. Instead,
a company will recognise such sales proceeds and related cost in
profit or loss.
• Amendments to IAS 37 Provisions, Contingent Liabilities and
Contingent Assets specify which costs a company includes when
assessing whether a contract will be loss-making.
• Annual Improvements 2018-2020 make minor amendments to
IFRS 1 First-time Adoption of International Financial Reporting
Standards, IFRS 9 Financial Instruments, IAS 41 Agriculture and
the Illustrative Examples accompanying IFRS 16 Leases.
1.1.4 The following new standards and amendments have been
issued, but are not mandatory for the first time for the financial
year beginning 1 January 2021 and have not been endorsed by
the European Union:
Amendments to IAS 1 ‘Presentation of Financial Statements:
Classification of Liabilities as current or non-current’ (effective
01/01/2023), affect only the presentation of liabilities in the
statement of financial position — not the amount or timing of
recognition of any asset, liability income or expenses, or the
information that entities disclose about those items. They:
• Clarify that the classification of liabilities as current or non-
current should be based on rights that are in existence at the
end of the reporting period and align the wording in all affected
paragraphs to refer to the “right” to defer settlement by at least
twelve months and make explicit that only rights in place “at the
end of the reporting period” should affect the classification of a
liability;
• Clarify that classification is unaffected by expectations about
whether an entity will exercise its right to defer settlement of
a liability; and make clear that settlement refers to the transfer
to the counterparty of cash, equity instruments, other assets or
services.
Amendments to IAS 1 Presentation of Financial Statements
and IFRS Practice Statement 2: Disclosure of Accounting
policies (effective 1 January 2023). The amendments aim to
improve accounting policy disclosures and to help users of
the financial statements to distinguish between changes in
accounting estimates and changes in accounting policies. The
IAS 1 amendment requires companies to disclose their material
accounting policy information rather than their significant
accounting policies. Further, the amendment to IAS 1 clarifies that
immaterial accounting policy information need not be disclosed.
To support this amendment, the Board also amended IFRS Practice
Statement 2, ‘Making Materiality Judgements’, to provide guidance
on how to apply the concept of materiality to accounting policy
disclosures. The amendments are effective for annual reporting
periods beginning on or after 1 January 2023. Earlier application is
permitted (subject to any local endorsement process).
Amendments to IAS 8 Accounting policies, Changes in Accounting
Estimates and Errors: Definition of Accounting Estimates (effective
1 January 2023). The amendment to IAS 8, ‘Accounting Policies,
Changes in Accounting Estimates and Errors, clarifies how
companies should distinguish changes in accounting policies from
changes in accounting estimates. The amendments are effective
for annual reporting periods beginning on or after 1 January 2023.
Earlier application is permitted (subject to any local endorsement
process).
Amendments to IAS 12 Income Taxes: Deferred Tax related to
Assets and Liabilities arising from a Single Transaction (effective 1
January 2023). The amendments clarify how companies account for
deferred tax on transactions such as leases and decommissioning
obligations. The main change in the amendments is an exemption
from the initial recognition exemption of IAS 12.15(b) and IAS
12.24. Accordingly, the initial recognition exemption does not
apply to transactions in which equal amounts of deductible and
taxable temporary differences arise on initial recognition. The
amendments are effective for annual reporting periods beginning
on or after 1 January 2023. Early adoption is permitted.
1.2 Consolidation
1.2.1 Subsidiaries
The consolidated financial statements comprise the financial
statements of the Company and its subsidiaries. Subsidiaries are
all entities (including special purpose entities) over which the
Group has control. The Group controls an entity when the Group is
exposed to, or has rights to, variable returns from its involvement
with the entity and has the ability to affect those returns through
its power over the entity. Subsidiaries are fully consolidated from
the date on which control is transferred to the Group. They are
deconsolidated from the date that control ceases.
The Group uses the full acquisition method of accounting to
account for business combinations. The consideration transferred
for the acquisition of a subsidiary is the fair value of the assets
transferred, the liabilities incurred and the equity interests issued
by the Group. The consideration transferred includes the fair value
of any asset or liability resulting from a contingent consideration
arrangement. Acquisition related costs are expensed as incurred.
Identifiable assets acquired and liabilities and contingent liabilities
assumed in a business combination are measured initially at
their fair value at the acquisition date. The Group recognises
any non-controlling interest in the acquiree on an acquisition-
by-acquisition basis either at fair value or at the non-controlling
interest’s proportionate share of the acquiree’s net assets.
If the business combination is achieved in stages, the acquisition
date carrying value of the acquirer’s previously held equity interest
in the acquiree is re-measured to fair value at the acquisition
date; any gains or losses arising from such re-measurement are
recognized in the income statement.
Any contingent consideration to be transferred by the Group
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
160
is recognised at fair value at the acquisition date. Subsequent
changes to the fair value of the contingent consideration that is
deemed to be an asset or liability is recognised in accordance with
IFRS 9 in profit or loss. Contingent consideration that is classified
as equity is not re-measured, and its subsequent settlement is
accounted for within equity.
Goodwill is initially measured at cost, being the excess of
the aggregate of the consideration transferred, the amount
recognised for non-controlling interest and the fair value of any
other participation previously held in the subsidiary acquired over
the net identifiable assets acquired and liabilities assumed. If the
fair value of the net assets acquired is in excess of the aggregate
consideration transferred, the amount recognized for non-
controlling interest and the fair value of any other participation
previously held in the subsidiary acquired the gain is recognised in
profit or loss (note 1.6).
Cost is adjusted to reflect changes in consideration arising from
contingent consideration amendments.
The subsidiaries’ financial statements are prepared as of the
same reporting date and using the same accounting policies
as the parent company. Intra-group transactions, balances and
unrealised gains/losses on transactions between group companies
are eliminated.
1.2.2 Changes in ownership interests in subsidiaries without
change of control
Transactions with non-controlling interests that do not result in
loss of control are accounted for as transactions with the owners
in their capacity as owners. The difference between consideration
paid and the relevant share acquired of the carrying value of net
assets of the subsidiary is recorded in equity. Gains or losses on
disposals to non-controlling interests are also recorded in equity.
Any profit or loss and any item of the Statement of Other
Comprehensive Income is allocated between the share-holders of
the parent and the non-controlling interest, even if the allocation
results in a deficit balance of the non-controlling interest.
1.2.3 Disposal of subsidiaries
When the Group ceases to have control any retained interest in
the entity is re-measured to its fair value at the date when control
is lost, with the change in carrying amount recognised in profit
or loss. The fair value becomes the initial carrying amount for the
purposes of subsequently accounting for the retained interest
as an associate, joint venture or financial asset. In addition, any
amounts previously recognised in other comprehensive income in
respect of that entity are accounted for as if the Group had directly
disposed of the related assets or liabilities. This may mean that
amounts previously recognised in other comprehensive income
are reclassified to profit or loss.
1.2.4 Joint arrangements
Investments in joint arrangements are classified as either joint
operations or joint ventures depending on the contractual rights
and obligations each investor has rather than the legal structure
of the joint arrangement. The Group has assessed the nature of
its joint arrangement and determined it to be a joint venture.
Joint ventures are consolidated with the equity method of
consolidation.
Under the equity method of accounting, interests in joint
ventures are initially recognized at cost and adjusted thereafter
to recognize the Group’s share of the post-acquisition profits or
losses and movements in other comprehensive income. When
the Group’s share of losses in a joint venture equals or exceeds
its interests in the joint ventures (which includes any long-
term interests that, in substance, form part of the Group’s net
investment in the joint ventures), the Group does not recognize
further losses, unless it has incurred obligations or made
payments on behalf of the joint ventures.
Unrealized gains on transactions between the Group and its joint
ventures are eliminated to the extent of the Group’s interest
in the joint ventures. Unrealized losses are also eliminated
unless the transaction provides evidence of an impairment of
the asset transferred. Accounting policies of joint ventures have
been adjusted where necessary to ensure consistency with the
policies adopted by the Group. The financial statements of the
joint venture are prepared as of the same reporting date with the
parent company.
1.2.5 Associates
Associates are entities over which the Group has significant
influence (holds directly or indirectly 20% or more of the voting
power of the entity) but which it does not control. Investments
in associates are accounted for using the equity method of
accounting and are initially recognised at cost. The Group’s
investment in associates includes goodwill (net of any cumulative
impairments losses) identified on acquisition.
Under the equity method the Group’s share of the post-acquisition
profits or losses is recognised in the income statement and its
share of post-acquisition movements in other comprehensive
income is recognized in other comprehensive income with
a corresponding adjustment to the carrying amount of the
investment. When the Group’s share of losses in an associate
equals or exceeds its interest in the associate, the Group does
not recognize further losses, unless the Group has incurred legal
or constructive obligations or made payments on behalf of the
associates.
If the ownership interest in an associate is reduced but significant
influence is retained, only a proportionate share of the amount
previously recognized in other comprehensive income is
reclassified to profit or loss where appropriate.
The Group determines at each reporting date whether there is
any objective evidence that the investment in the associate is
impaired. If this is the case, the Group calculates the amount
of the impairment as the difference between the recoverable
amount of the associate and its carrying value and recognizes the
amount adjacent to “share of profit/(loss) of associates and joint
ventures” in the income statement.
Profit and losses resulting from upstream and downstream
transactions between the Group and its associate are recognized
in the Group’s financial statements only to the extent of unrelated
investor’s interests in the associates. Unrealized gains on
transactions between the Group and its associates are eliminated
to the extent of the Group’s interest in the associates; unrealized
losses are also eliminated unless the transaction provides
evidence of an impairment of the asset transferred.
Accounting policies of associates have been adjusted where
MANAGEMENT REPORT
FINANCIAL REVIEW
161
necessary to ensure consistency with the policies adopted by the
Group.
The financial statements of the associates are prepared as of the
same reporting date with the parent company.
1.3 Foreign currency translation
Functional and presentation currency
Items included in the financial statements of each entity in the
Group are measured in the functional currency, which is the
currency of the primary economic environment in which each
Group entity operates. The consolidated financial statements are
presented in Euros.
Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates (i.e. spot rates) prevailing
at the dates of the transactions or valuation where items are
re-measured. Foreign exchange gains and losses resulting from
the settlement of such transactions and from the translation
at year-end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised under finance
function in the account “gain/(loss) from foreign exchange
differences” of the income statement, except when deferred in
other comprehensive income as qualifying net investment hedges.
When the related investment is disposed of, the cumulative
amount is reclassified to profit or loss.
Exchange differences arising from intragroup long term loans and
receivables that are designated as part of a reporting entity's net
investment in a foreign operation shall be recognised in profit or
loss in the separate financial statements of the reporting entity,
or, of the individual financial statements of the foreign operation,
as appropriate. In the consolidated financial statements such
exchange differences shall be recognized in other comprehensive
income and included in “currency translation differences
reserve on transactions designated as part of net investment in
foreign operation” in other reserves. Where settlement of these
intragroup long term loans and receivables is planned or is likely
to occur in the foreseeable future, then these transactions cease
to form part of the net investment in the foreign operation.
The exchange differences arising up to that date are recognized
in other comprehensive income and after that date, they are
recognized in profit or loss. On disposal of the net investment in
a foreign operation, the accumulated in other reserves exchange
differences are reclassified from equity to profit or loss.
Translation differences on non-monetary financial assets and
liabilities, such as equity investments held at fair value are
included in the income statement. Translation differences on
non-monetary financial assets, such as equities classified at fair
value through other comprehensive income, are included in other
comprehensive income.
Group companies
The financial statements of all Group entities (none of which
operate in a hyperinflationary economy) that have a functional
currency different from the presentation currency are translated
into the presentation currency as follows:
• Assets and liabilities for each balance sheet presented are
translated at the closing rate at the date of the balance sheet.
• Income and expenses for each statement of profit or loss and
statement of comprehensive income are translated at average
exchange rates.
• All exchange differences resulting from the above are recognised
in other comprehensive income and subsequently included in
“foreign currency translation reserve”.
• On the disposal of a foreign operation (partly or fully disposed),
the cumulative exchange differences relating to that particular
foreign operation, recognized in the “foreign currency translation
reserve” within equity, are recognised in the income statement
as part of the gain or loss on sale. On the partial disposal of a
foreign subsidiary, the proportionate share of the cumulative
amount is re-attributed to the non-controlling interest in that
operation.
On consolidation, exchange differences arising from the
translation of borrowings designated as hedges of investments
in foreign entities, are taken to other comprehensive income and
included under “currency translation differences on derivative
hedging position” in other reserves.
Goodwill and fair value adjustments arising on the acquisition of
a foreign entity are treated as assets and liabilities of the foreign
entity and translated at the closing rate. Exchange differences
arising are recognized in other comprehensive income.
1.4 Property, plant and equipment
Property, plant and equipment (PPE) is stated at historical cost
less accumulated depreciation and impairment losses, except for
land (excluding land improvements and quarries), which is shown
at cost less impairment losses.
Cost includes expenditure that is directly attributable to the
acquisition of the items and any environmental rehabilitation
costs to the extent that they have been recognised as a provision
(refer to note 1.20). Subsequent costs are included in the asset’s
carrying amount or recognised as a separate asset, as appropriate,
only when it is probable that future economic benefits associated
with the item will flow to the entity and the cost of the item can
be measured reliably. The carrying amount of the replaced part
is derecognized. All other repairs and maintenance are charged
to the income statement as incurred. Subsequent costs are
depreciated over the remaining useful life of the related asset or
to the date of the next major subsequent cost whichever is the
sooner.
Depreciation, with the exception of quarries and land, is calculated
using the straight-line method to allocate the cost of the assets to
their residual values over their estimated useful lives as follows:
Buildings Up to 50 years
Plant and machinery Up to 40 years
Motor vehicles 5 to 20 years
Office equipment furniture and fittings
(including computer equipment and
software integral to the operation of the
hardware)
2 to 10 years
Minor value assets Up to 2 years
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Land on which quarries are located is depreciated on a depletion
basis. This depletion is recorded as the material extraction
process advances based on the unit-of-production method. Other
land is not depreciated.
The assets’ residual values and useful lives are reviewed,
and adjusted if appropriate, at each reporting date. Where
the carrying amount of an asset is greater than its estimated
recoverable amount, it is written down immediately to its
recoverable amount (refer to note 1.8 - Impairment of non-
financial assets other than Goodwill).
An item of PPE and any significant part initially recognised is
derecognised upon disposal or when no future economic benefits
are expected from its use or disposal. Gains and losses on
disposals are determined by comparing proceeds with carrying
amount and are included in profit or loss.
Interest costs on borrowings specifically used to finance the
construction of PPE are capitalised during the construction period
if recognition criteria are met (refer to note 1.29).
1.5 Investment properties
Investment property is property held for long-term rental yields or
for capital appreciation or both and that is not occupied by any of
the subsidiaries of the Group. Owner-occupied properties are held
for production and administrative purposes. This distinguishes
owner-occupied property from investment property.
Investment property is measured initially at cost, including related
transaction costs and where applicable borrowing costs (refer to
1.29).
After initial recognition investment property is carried at fair
value. Fair value reflects market conditions at the reporting date
and is determined internally on an annual basis by management or
external valuators. The best evidence of fair value is provided by
current prices in an active market for similar property in the same
location and condition and subject to the same lease terms and
other conditions (comparable transactions). When such identical
conditions are not present, the Group takes account of, and makes
allowances for, differences from the comparable properties in
location, nature and condition of the property or in contractual
terms of leases and other contracts relating to the property.
A gain or loss arising from a change in the fair value of investment
property is recognized in the period in which it arises in the
income statement within “other income” or “other expense” as
appropriate.
Subsequent expenditure is capitalised to the asset’s carrying
amount only when it is probable that future economic benefits
associated with the expenditure will flow to the Group and the
cost of the item can be measured reliably. All other repairs and
maintenance costs are expensed when incurred. When part of
an investment property is replaced, the carrying amount of the
replaced part is derecognised.
The fair value of investment property does not reflect future
capital expenditure that will improve or enhance the property
and does not reflect the related future benefits from this future
expenditure other than those a rational market participant would
take into account when determining the value of the property.
Where the Group disposes of a property at fair value in an arm’s
length transaction, the carrying value immediately prior to the
sale is adjusted to the transaction price, and the adjustment is
recorded in the income statement within the gain or loss from fair
value adjustment on investment property. Investment properties
are derecognised when they have been disposed.
If an investment property becomes owner-occupied, it is
reclassified as PPE. Its fair value at the date of reclassification
becomes its deemed cost for subsequent accounting purposes.
If an item of owner-occupied property becomes an investment
property because its use has changed, IAS 16 is applied up to
the date of transfer, since investment property is measured at
fair value. The property is fair valued at the date of transfer and
any revaluation gain or loss, being the difference between fair
value and the previous carrying amount, is accounted for as a
revaluation surplus or deficit in equity in accordance with IAS
16. Revaluation surplus is recognized directly in equity through
other comprehensive income, unless there was an impairment
loss recognized for the same property in prior years. In this case,
the surplus up to the extent of this impairment loss is recognized
in profit or loss and any further increase is recognized directly
in equity through other comprehensive income. Any revaluation
deficit is recognized in profit or loss.
1.6 Goodwill and intangible assets (other than goodwill)
1.6.1 Goodwill
Goodwill arises on the acquisition of subsidiaries and represents
the excess of the aggregate of the consideration transferred and
the amount recognised for non-controlling interest over the net
identifiable assets acquired and liabilities assumed. If the excess
of the aggregate of the consideration transferred and the amount
recognised for non-controlling interest over the net identifiable
assets acquired and liabilities assumed is smaller than the fair
value of the net assets of the acquired subsidiary, the difference
is recognized in the profit or loss. Goodwill represents the future
economic benefits arising from assets that are not capable
of being individually identified and separately recognized in a
business combination.
Goodwill is not amortized. After initial recognition, it is measured
at cost less any accumulated impairment losses.
For the purpose of impairment testing, goodwill acquired in a
business combination is, from the acquisition date, allocated to
each cash-generating-unit that is expected to benefit from the
synergies of the combination. Each unit or group of units to which
the goodwill is allocated represents the lowest level within the
entity at which the goodwill is monitored for internal management
purposes.
Impairment reviews are undertaken annually (even if there is no
indication of impairment) or more frequently if events or changes
in circumstances indicate a potential impairment. The carrying
value of goodwill is compared to the recoverable amount, which is
the higher of the value-in-use and the fair value less costs to sell.
Any impairment is recognised immediately as an expense and is
not subsequently reversed.
Where goodwill has been allocated to a cash-generating-unit
(CGU) and part of the operation within that unit is disposed of,
the goodwill associated with the disposed operation is included in
the carrying amount of the operation when determining the gain
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or loss on disposal. Goodwill disposed in these circumstances is
measured based on the relative values of the disposed operation
and the portion of the cash-generating unit retained.
1.6.2 Intangible assets (other than goodwill)
Intangible assets acquired separately are measured on initial
recognition at cost. The cost of intangible assets acquired in a
business combination is their fair value at the date of acquisition.
Following initial recognition, intangible assets are carried at cost
less any accumulated amortisation and accumulated impairment
losses.
The Group’s intangible assets have a finite useful life.
Intangible assets with finite lives are amortised over the useful
economic life and assessed for impairment whenever there is
an indication that the intangible asset may be impaired. The
amortisation period and the amortisation method for an intangible
asset with a finite useful life are reviewed at least at the end of
each reporting period. Changes in the expected useful life or the
expected pattern of consumption of future economic benefits
embodied in the asset are considered to modify the amortisation
period or method, as appropriate, and are treated as changes in
accounting estimates. The amortisation expense on intangible
assets with finite lives is recognised in the income statement as
the expense category that is consistent with the function of the
intangible assets.
Acquired computer software programs and licenses are capitalised
on the basis of costs incurred to acquire and bring to use the
specific software when these are expected to generate economic
benefits beyond one year. Costs associated with developing or
maintaining computer software programs are recognised as an
expense as incurred.
The amortization methods used for the Group’s intangibles are as
follows:
Amortization Method Useful Lives
Patents, trademarks
and customer
relationships
straight-line basis up to 20 years
Licenses (mining
permits)
straight-line basis /
depletion method
shorter of:
the permit
period and the
estimated life of
the underlying
quarry unit-
of-production
method
Development costs
(quarries under
operating leases)
note 1.7 note 1.7
Computer software straight-line basis 3 to 10 years
Gains or losses arising from derecognition of an intangible asset
are measured as the difference between the net disposal proceeds
and the carrying amount of the asset and are recognised in the
income statement when the asset is derecognised.
1.7 Deferred stripping costs
Stripping costs comprise the removal of overburden and other
waste products. Stripping costs incurred in the development of a
quarry before production commences are capitalised as follows:
Where such costs are incurred on quarry land that is owned by
the Group, these are included within the carrying amount of the
related quarry, under PPE and subsequently depreciated over
the life of the quarry on a units-of-production basis. Where such
costs are incurred on leased quarries, these are included under
‘Development expenditure’ under Intangible assets and amortised
over the shorter of the lease term and the useful life of the quarry.
1.8 Impairment of non-financial assets other than Goodwill
Assets that have an indefinite useful life (land not related
to quarries) are not subject to amortisation and are tested
annually for impairment. Assets that are subject to amortisation
are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be
recoverable. An impairment loss is recognised, as an expense
immediately, for the amount by which the asset’s carrying amount
exceeds its recoverable amount. For the purposes of assessing
impairment, assets are grouped at the lowest levels for which
there are separately identifiable cash flows (cash-generating
units). Non-financial assets other than goodwill that suffered
impairment are reviewed for possible reversal of the impairment
at each reporting date. An asset’s recoverable amount is the
higher of an asset or cash generating units (CGU) fair value less
costs of sell and its value-in-use.
1.9 Leases
1.9.1 Lessees
Leases are recognized as a right-of-use (ROU) asset and a
corresponding lease liability at the date at which the leased asset
is available for use. Each lease payment is allocated between the
lease liability and interest, which is charged to profit or loss over
the lease period to produce a constant periodic rate of interest
on the remaining balance of the liability for each period. The ROU
asset is depreciated over the shorter of the asset's useful life and
the lease term on a straight-line basis.
The Group presents ROU assets that do not meet the definition
of investment property in the account “property, plant and
equipment”, in the same line item as it presents underlying
assets of the same nature that it owns. ROU assets that meet the
definition of investment property are presented with investment
property.
The lease liability is initially measured at the commencement date
at the present value of the lease payments during the lease term
that are not yet paid. It is discounted by using the interest rate
implicit in the lease or, if that rate cannot be readily determined,
the incremental borrowing rate (IBR). The IBR is the rate that the
lessee would have to pay to borrow the funds necessary to obtain
an asset of a similar value in a similar economic environment with
similar terms and condition.
The lease liability is subsequently increased by the interest cost
on the lease liability and decreased by lease payment made. It is
re-measured when there is a modification that is not accounted
for as a separate lease; a change in future lease payments arising
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from a change in an index or rate; a change in the estimate of the
amount expected to be payable under a residual value guarantee;
and if the Group changes its assessment of whether a purchase
or extension option is reasonably certain to be exercised or a
termination option is reasonably certain not to be exercised.
Lease liabilities include the net present value of the following
lease payments:
• Fixed payments (including in-substance fixed payments)
• Variable lease payments that are based on an index or a rate
• Amounts expected to be payable by the lessee under residual
value guarantees
• The exercise price of a purchase option if the lessee is reasonably
certain to exercise that option
• Payments of penalties for terminating the lease if the lessee will
exercise that option
The ROU asset is initially measured at cost, and subsequently at
cost less any accumulated depreciation and impairment losses,
and adjusted for certain re-measurements of the lease liability.
When ROU asset meets the definition of investment property
is initially measured at cost, and subsequently measured at fair
value, in accordance with the Group’s accounting policy.
The initial measurement of the ROU asset is comprised by:
• The amount of the initial measurement of lease liability
• Any lease payments made at or before the commencement date
less any lease incentives received
• Any initial direct costs, and
• Restoration costs
For short term leases and certain leases of low value assets,
the Group has elected not to recognise ROU assets and lease
liabilities. It recognises the lease payments associated with these
leases as an expense on a straight-line basis over the lease term.
For leases that contain both lease and non-lease components, the
Group chose not to separate them, except for terminals in which
non-lease components are separated from lease components.
1.9.2 Lessors
Leases in which the Group does not transfer substantially all
the risks and benefits of ownership of an asset are classified as
operating leases. Operating leases of PPE are recognized according
to their nature in the statement of financial position.
Payments made under operating leases are charged to profit or
loss on a straight-line basis over the period of the lease.
Initial direct costs incurred in negotiating and arranging an
operating lease are added to the carrying amount of the leased
asset and recognised over the lease term on the same basis as
rental income.
Contingent rents are recognised as revenue in the period in which
they are earned.
1.10 Inventories
Inventories are stated at the lower of cost and net realisable value.
Cost is determined using the weighted average cost method.
The cost of finished goods and work in progress comprises raw
materials, direct labour, other direct costs and related production
overheads (based on normal operating capacity), but excludes
borrowing costs. Net realisable value is the estimated selling price
in the ordinary course of business, less the estimated costs of
completion and selling expenses.
Appropriate allowance is made for damaged, obsolete and slow
moving items. Write-downs to net realisable value and inventory
losses are expensed in cost of sales in the period in which the
write-downs or losses occur.
1.11 Trade receivables
Trade receivables are amounts due from customers for
merchandise sold or services performed in the ordinary course
of business. If collection is expected in one year or less (or in
the normal operating cycle of the business if longer), they are
classified as current assets. If not, they are presented as non-
current assets.
Trade receivables are recognised initially at the amount of
consideration that is unconditional and subsequently measured
at amortised cost using the effective interest method, less loss
allowance.
1.12 Cash and cash equivalents
In the statement of cash flows, cash and cash equivalents
comprise cash on hand, deposits held at call with banks, other
short-term highly liquid investments of three months or less from
the date of acquisition, and bank overdrafts, if they exist. Bank
overdrafts are included within borrowings in current liabilities in
the balance sheet. The components of cash and cash equivalents
have a negligible risk of change in value.
1.13 Share capital
Any excess of the fair value of the consideration received over the
par value of the shares issued is recognized as “share premium”
in shareholders’ equity. Incremental external costs directly
attributable to the issue of new shares or share options are shown
in equity as a deduction, net of tax, from the proceeds.
Where the Company or its subsidiaries purchases the Company’s
own equity share capital (treasury shares), the consideration
paid including any attributable incremental external costs net of
income taxes is deducted from total shareholders’ equity until
they are cancelled or sold. Where such shares are subsequently
sold or reissued, any consideration received, net of any directly
attributed incremental transaction costs and the related income
tax effect, is included in shareholders’ equity.
1.14 Borrowings
Borrowings are recognised initially at fair value, net of transaction
costs incurred. In subsequent periods, borrowings are carried at
amortised cost using the effective interest method. Any difference
between proceeds (net of transaction costs) and the redemption
value is recognised in the income statement over the period of the
borrowings using the effective interest method.
Fees paid on the establishment of loan facilities are recognized as
transactions costs of the loan to the extent that it is probable that
some or all of the facility will be drawn down. In this case, the fee
is deferred until the draw down occurs. To the extent there is no
evidence that it is probable that some or all of the facility will be
drawn down, the fee is capitalised as a prepayment for liquidity
services and amortised over the period of the facility to which it
relates.
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Borrowings are classified as current liabilities unless the Group
entity has an unconditional right to defer settlement for at least 12
months after the balance sheet date.
1.15 Current and deferred income taxes
The tax expense for the period comprises current and deferred
tax. Tax is recognised in the income statement, except to the
extent that it relates to items recognised in other comprehensive
income or directly in equity. In this case, the tax is also recognised
in other comprehensive income or directly in equity, respectively.
Current income tax is calculated on the basis of the tax laws
enacted or substantively enacted at the reporting date in the
countries where the Company and its subsidiaries operate and
generate taxable income. Management periodically evaluates
positions taken in tax returns with respect to situations in which
applicable tax regulation is subject to interpretation. It establishes
provisions where appropriate on the basis of amounts expected to
be paid to the tax authorities.
Deferred income tax is recognised using the liability method, on
temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the financial statements.
However, if the deferred income tax arises from initial recognition
of an asset or liability in a transaction other than a business
combination that at the time of the transaction affects neither
accounting nor taxable profit and loss, it is not accounted for.
Deferred tax assets are recognised for all deductible temporary
differences, the carry forward of unused tax credits and any
unused tax losses. Deferred tax assets are recognised to the
extent that it is probable that taxable profit will be available
against which the deductible temporary differences, and the
carry forward of unused tax credits and unused tax losses can be
utilized.
Deferred tax liabilities are recognised for taxable temporary
differences arising on investments in subsidiaries, joint
arrangements and associates, except where the Group is able to
control the reversal of the temporary difference and it is probable
that the temporary difference will not reverse in the foreseeable
future. Deferred income tax is determined using tax rates (and
laws) that have been enacted or substantively enacted at the
reporting date and are expected to apply when the related
deferred income tax asset is realised or the related deferred
income tax liability is settled.
Deferred income tax assets and liabilities are offset when there
is a legally enforceable right to offset current tax assets against
current tax liabilities and when the deferred income taxes assets
and liabilities relate to income taxes levied by the same taxation
authority on either the same taxable entity or different taxable
entities where there is an intention to settle the balances on a net
basis.
1.16 Employee benefits
1.16.1 Pension and other retirement obligations
The Group operates various pension and other retirement
schemes, including both defined benefit and defined contribution
pension plans in accordance with the local conditions and
practices in the countries in which it operates. A defined
contribution plan is a pension plan under which the Group pays
fixed contributions into a separate entity. The Group has no legal
or constructive obligations to pay further contributions if the fund
does not hold sufficient assets to pay all employees the benefits
relating to employee service in the current and prior periods.
A defined benefit plan is a pension plan that is not a defined
contribution plan.
Typically defined benefit plans define an amount of pension
benefit that an employee will receive on retirement, usually
dependent on one or more factors such as age, years of service
and compensation.
The liability recognized in the statement of financial position
in respect of defined benefit pension or retirement plans is the
present value of the defined benefit obligation at the reporting
date less the fair value of plan assets.
The defined benefit obligation is calculated annually by
independent actuaries using the projected unit credit method.
The present value of the defined benefit obligation is determined
by discounting the estimated future cash outflows using interest
rates of high-quality corporate bonds that are denominated in the
currency in which the benefits will be paid, and that have terms
approximating to the terms of the related obligation. In countries
where there is no deep market in such bonds, the market rates on
government bonds are used.
Past service costs are recognized in profit or loss on the earlier of:
• The date of the plan amendment or curtailment, and
• The date that the Group recognizes restructuring-related costs
Net interest is calculated by applying the discount rate to the
net defined benefit liability or asset. The Group recognizes the
following changes in the net defined benefit obligation:
Service costs comprising current service costs, past-service costs,
gains and losses on curtailments and non-routine settlements
under other operating expenses/income
Net interest expense or income under finance expenses
Re-measurements, comprising of the actuarial gains and losses,
the effect of the asset ceiling, excluding net interest (not
applicable to the Group) and the return on plan assets (excluding
net interest), are recognized immediately in the statement of
financial position with a corresponding debit or credit to retained
earnings through other comprehensive income (OCI) in the period
in which they occur. Re-measurements are not reclassified to
profit or loss in subsequent periods.
For defined contribution plans, the Group pays contributions to
publicly or privately administered pension insurance plans on a
mandatory, contractual or voluntary basis. Once the contributions
have been paid, the Group has no further payment obligations.
The regular contributions constitute net periodic costs for the year
in which they are due and as such are included in staff costs.
1.16.2 Termination benefits
Termination benefits are payable when employment is terminated
by the group before the normal retirement date, or when an
employee accepts voluntary redundancy in exchange for these
benefits.
The Group recognises termination benefits at the earlier of the
following dates: (a) when the group can no longer withdraw the
offer of those benefits; and (b) when the entity recognises costs
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for a restructuring that is within the scope of IAS 37 and involves
the payment of terminations benefits. The obligating event is
the termination and not the service. In the case of an offer made
to encourage voluntary redundancy, the termination benefits
are measured based on the number of employees expected to
accept the offer. Benefits falling due more than 12 months after
the end of the reporting period are discounted to their present
value.
1.16.3 Profit sharing and bonus plans
A liability for employee benefits in the form of profit sharing and
bonus plans is recognised in other provisions when the following
conditions are met:
there is a formal plan and the amounts to be paid are determined
before the time of issuing the financial statements; or
past practice has created a valid expectation by employees that
they will receive a bonus/ profit sharing and the amount can be
determined before the time of issuing the financial statements.
1.16.4 Share-based payments
Share-based compensation benefits are provided to members of
senior management via Group share schemes that cover several
subsidiaries.
Equity-settled transactions
The fair value of options granted under the Share Option
Programs is recognised as an employee benefits expense in the
Income Statement, with a corresponding increase in equity. The
total amount to be expensed is determined by reference to the
fair value of the options granted:
• Including any market performance conditions (for example, an
entity’s share price);
• Excluding the impact if any service and non-market
performance vesting conditions (for example profitability, sales
growth targets and remaining an employee of the entity over a
specified time period); and
• Including the impact of any non-vesting conditions (for
example, the requirement for employees to save)
The total expense is recognised over the vesting period, which
is the period over which all of the specified vesting conditions
are to be satisfied. At the end of each period, the Group revises
its estimates of the number of options that are expected to
vest based on the non-market vesting and service conditions.
It recognises the impact of the revision to original estimates, if
any, in profit or loss, with a corresponding adjustment to equity.
Share options are exercised at given prices, which are normally
at a discount of the share’s market price at grant dates. When
the options are exercised, either the Company issues new
shares, or the Group settles the awards with existing treasury
shares. The proceeds received net of any directly attributable
transaction costs are credited to share capital (nominal value)
and share premium reserve.
Cash-settled transactions
The fair value of the awards granted to employees for nil
consideration under the Long-term Incentive Plans is measured
initially and at each reporting date up to and including the
settlement date, at the fair value of the liability with changes
in fair value recognised as employee benefits expense in the
Income Statement. At each reporting date, the Group revises its
estimation of the number of the awards that they will vest and
it recognises the impact of the revised estimates in the Income
Statement.
1.17 Government grants
Government grants are recognised at their fair value where there
is a reasonable assurance that the grant will be received and the
Group will comply with all attached conditions.
Government grants are recognized in profit or loss on a
systematic basis over the periods in which the Group recognizes
as expenses the related costs for which the grants are intended
to compensate. Specifically, government grants whose primary
condition is that the Group should purchase, construct or
otherwise acquire non-current assets are recognized as deferred
revenue in the statement of financial position and transferred to
profit or loss on a systematic and rational basis over the useful
lives of the related assets.
1.18 CO₂ Emission rights
Emission rights are accounted for under the net liability method.
Allocated allowances that are granted free of charge are
recognised as an intangible asset at cost, which is nil. Emission
rights purchased in excess of those required to cover shortages
are recognised as an intangible asset, at cost. To the extent that
emissions generated to date exceed the volume of allowances
held, the Group recognizes a liability. If emissions do not exceed
allowances held, there is no obligation to purchase additional
allowances and, therefore, no liability to provide for additional
emission allowances required. The Group has chosen to
measure the net liability on the basis of the period for which the
irrevocable right to the cumulative emissions rights have been
received. Proceeds from the sale of granted emission rights are
recorded as a reduction to cost of sales.
1.19 Provisions and contingencies
Provisions represent liabilities of uncertain timing or amount
and are recognised when the Group has a present legal or
constructive obligation as a result of past events, it is probable
that an outflow of resources will be required to settle the
obligation, and a reliable estimate of the amount can be made.
Where the Group expects a provision to be reimbursed, for
example under an insurance contract, the reimbursement is
recognised as a separate asset but only when the reimbursement
is virtually certain. The expense relating to any provision is
presenting in the income statement net of any reimbursement.
Provisions are not recognized for future operating losses. The
Group recognises a provision for onerous contracts when the
economic benefits to be derived from a contract are less than
the unavoidable costs of meeting the obligations under the
contract.
Restructuring provisions comprise lease termination penalties
and employee termination payments, and are recognised in the
period in which the Group becomes legally or constructively
committed to payment. Costs related to the ongoing activities of
the Group are not provided for in advance.
Where the effect of the time value of money is material,
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provisions is measured at the present value of the expenditure
expected to be required to settle the obligation using a pre-tax
rate that reflects current market assessments of the time value
of money and the risks specific to the obligation. The increase in
the provision due the passage of time is recognized as a finance
expense.
Possible obligations and present obligations which do not meet
the recognition criteria of a provision are not recognised on the
statement of financial position, but are disclosed as contingent
liabilities. Contingent liabilities are current obligations arising
from past events that might, but will probably not, require an
outflow of resources embodying economic benefits, or the
obligations cannot be reliably estimated. Contingent assets
usually arise from unplanned or other unexpected events that
give rise to the possibility of an inflow of economic benefits to a
reporting entity. Contingent assets are disclosed only when an
inflow of economic benefits is probable. A contingent asset is not
recognised, because it might result in the recognition of income
that is never realized. When it becomes virtually certain that
an inflow of economic benefits will arise, then the asset should
be recognised. Contingent assets and liabilities are initially
recognised and subsequently measured as provisions do.
1.20 Site restoration, quarry rehabilitation and
environmental costs
Companies within the Group are generally required to restore
the land used for quarries and processing sites at the end of
their producing lives to a condition acceptable to the relevant
authorities and consistent with the Group’s environmental
policies. Provisions for environmental restoration are recognised
when the Group has a present legal or constructive obligation
as a result of past events and, it is probable that an outflow
of resources will be required to settle the obligation and the
amount has been reliably estimated.
Provisions associated with environmental damage represent
the estimated future cost of remediation. Estimating the future
costs of these obligations is complex and requires management
to use judgment.
The estimation of these costs is based on an evaluation of
currently available facts with respect to each individual site and
considers factors such as existing technology, currently enacted
laws and regulations and prior experience in remediation
of sites. Inherent uncertainties exist in such evaluations
primarily due to unknown conditions, changing governmental
regulations and legal standards regarding liability, the protracted
length of the clean-up periods and evolving technologies.
The environmental and remediation liabilities provided for
reflect the information available to management at the time of
determination of the liability and are adjusted periodically as
remediation efforts progress or as additional technical or legal
information becomes available.
Estimated costs associated with such rehabilitation activities are
measured at the present value of future cash outflows expected
to be incurred. When the effect of the passage of time is not
significant, the provision is calculated based on undiscounted
cash flows. Where a closure and environmental obligation
arises from quarry/mine development activities or relate to the
decommissioning PPE the provision can be capitalized as part
of the cost of the associated asset (intangible or tangible). The
capitalized cost is depreciated over the useful life of the asset
and any change in the net present value of the expected liability
is included in finance costs, unless they arise from changes in
accounting estimates of valuation.
1.21 Revenue
Revenue is the amount of consideration expected to be received
in exchange for transferring promised goods or services to a
customer, excluding amounts collected on behalf of third parties
(value-added tax, other sales taxes etc.).
Revenue is recognized when (or as) a performance obligation is
satisfied by transferring the control of a promised good or service
to the customer. A customer obtains control of a good or service
if it has the ability to direct the use of and obtain substantially
all of the remaining benefits from that good or service. Control is
transferred over time or at a point in time.
Revenue from the sale of goods is recognised when control of the
good is transferred to the customer, usually upon delivery and
there is no unfulfilled obligation that could affect the customer’s
acceptance of the products. The main products of the Group
are cement, clinker, ready-mix, fly ash and other cementitious
products.
Revenue arising from services is recognised in the accounting
period in which the services are rendered, and it is measured
using either output methods or input methods, depending on
the nature of service provided.
A receivable is recognized when there is an unconditional right
to consideration for the performance obligations to the customer
that are satisfied.
A contract asset is recognized when the performance obligation
to the customer is satisfied before the customers pays or before
payment is due, usually when goods or services are transferred
to the customer before the Group has a right to invoice.
A contract liability is recognized when there is an obligation to
transfer goods or services to a customer for which the Group
has received consideration from the customer (prepayments) or
there is an unconditional right to receive consideration before
the Group transfers a good or a service (deferred income). The
contract liability is derecognized when the promise is fulfilled
and revenue is recorded in the profit or loss statement.
1.22 Dividend distribution
Dividend to the Company’s shareholders is recognized in
the financial statements in the period in which the Board of
Directors’ proposed dividend is ratified at the Shareholders’
Annual General Meeting.
1.23 Segment information
Segment information is presented on the same basis as the
internal information provided to the chief operating decision
maker. The chief operating decision maker is the person (or the
group of persons) that allocates resources to and assesses the
operating results of the segments.
For management purposes, the Group is structured in five
operating segments: Greece and Western Europe, North
America, South Eastern Europe, Eastern Mediterranean and Joint
Ventures. Each region has a regional Chief Executive Officer
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TITAN CEMENT GROUP
168
(CEO) who reports to the Group's CEO. In addition, the Finance
Department is organized also by region for effective financial
controlling and performance monitoring.
1.24 Financial assets
Classification and measurement
The Group classifies its financial assets in the following
measurement categories:
• Those to be measured subsequently at fair value (either
through OCI or through profit or loss) and,
• Those to be measured at amortised cost.
The classification depends on the entity’s business model for
managing the financial assets and the contractual terms of the
cash flows.
The Group initially measures a financial asset at its fair value
plus, in the case of a financial asset not at fair value through
profit or loss, transaction costs. Transaction costs of financial
assets carried at fair value through profit or loss are expenses.
Trade receivables are initially measured at their transaction
price.
Financial assets with embedded derivatives are considered in
their entirety when determining whether their cash flows are
solely payment of principal and interest.
Under IFRS 9, debt financial instruments are subsequently
measured at amortised cost, fair value through other
comprehensive income (FVOCI) or fair value through profit or
loss (FVPL). The classification is based on two criteria: a) the
business model for managing the assets and b) whether the
instruments’ contractual cash flows represent “solely payments
of principal and interest” on the principal amount outstanding
(the ‘SPPI criterion’).
The new classification and measurement of the Group’s debt
financial assets are, as follows:
I. Debt instruments at amortised cost for financial assets
that are held within a business model with the objective to
hold the financial assets in order to collect contractual cash
flows that meet the SPPI criterion. Interest income from
these financial assets is included in finance income using
the effective interest rate method. Any gain or loss arising
on de-recognition is recognised directly in the income
statement.
II. Debt instruments at FVOCI, with gains or losses recycled
to profit or loss on de-recognition. Financial assets in this
category are debt instruments that meet the SPPI criterion
and are held within a business model both to collect cash
flows and to sell. Movements in the carrying amount are
taken through OCI, except for the recognition of impairment
gains or losses, interest revenue and foreign exchange gains
or losses which are recognised in profit or loss. Interest
income from these financial assets is included in finance
income using the effective interest rate method.
III. Financial assets at FVPL comprise derivative instruments
and equity instruments, which the Group had not irrevocably
elected, at initial recognition or transition, to classify at
FVOCI. This category would also include debt instruments
whose cash flow characteristics fail the SPPI criterion or
are not held within a business model whose objective is
either to collect contractual cash flows, or to both collect
contractual cash flows and sell. A gain or loss on financial
assets that subsequently measures at FVPL is recognized in
income statement.
Other financial assets are classified and subsequently measured,
as follows:
IV. Equity instruments at FVOCI, with no recycling of gains or
losses to profit or loss on de-recognition. This category only
includes equity instruments, which the Group intends to
hold for the foreseeable future and which the Group (or the
Company) has irrevocably elected to so classify upon initial
recognition or transition. Equity instruments at FVOCI are
not subject to any impairment accounting. Dividends from
such investments continue to be recognised in profit or
loss, when the right to receive the payment is established,
unless they represent a recovery of part of the cost of the
investment.
V. Financial assets designated as measured at FVPL at initial
recognition that would otherwise be measured subsequently
at amortized cost or at FVOCI. Such a designation can
only be made, if it eliminates or significantly reduces an
“accounting mismatch” that would otherwise arise.
1.25 Offsetting financial instruments
Financial assets and liabilities are offset and the net amount
reported in the balance sheet when there is a legally enforceable
right to offset recognised amounts, and there is an intention
to settle on the net basis the liability or realise the asset and
settle the liability simultaneously. The legally enforceable right
to offset should not depend on future events but it should apply
in the ordinary course of business. However, it should be allowed
for the related amounts to be set off in certain circumstances,
such as bankruptcy or the termination of a contract.
1.26 Impairment of financial assets
The Group records an allowance for expected credit losses (ECLs)
for all financial assets not held at FVPL.
ECLs are based on the difference between the contractual cash
flows due in accordance with the contract and all the cash flows
that the Group expects to receive. The shortfall is then discounted
at an approximation to the asset’s original effective interest rate.
For contract assets, trade receivables and lease receivables, the
Group have applied the standard’s simplified approach and have
calculated ECLs based on lifetime expected credit losses.
For other financial assets, the ECL is based on the 12-month ECL.
The 12-month ECL is the portion of lifetime ECLs that results from
default events on a financial instrument that are possible within 12
months after the reporting date. However, when there has been a
significant increase in credit risk since origination, the allowance
will be based on the lifetime ECL.
1.27 Derivative financial instruments and hedging activities
Initially, derivatives are recognized at fair value at commencement
date and subsequently, they are re-measured at their fair value
at each reporting date. Derivatives are carried as financial assets
when the fair value is positive and as financial liabilities when the
fair value is negative.
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169
Any gains or losses arising from changes in the fair value of
derivatives are taken directly to profit or loss, except for the
effective portion of cash flow hedges, which is recognized in other
comprehensive income (OCI) and later is reclassified to profit or
loss when the hedge item affects profit or loss.
For the purpose of hedge accounting, hedges are classified as:
• Fair value hedges when hedging the exposure to changes in the
fair value of a recognized asset or liability or an unrecognized
firm commitment
• Cash flow hedges when hedging the exposure to variability
in cash flows that is either attributable to a particular risk
associated with a recognized asset or liability or a highly
probable forecast transaction or the foreign currency risk in an
unrecognized firm commitment
• Hedges of a net investment in a foreign operation
At the inception of a hedge relationship, the Group formally
designates and documents the hedge relationship to which it
wishes to apply hedge accounting and the risk management
objective and strategy for undertaking the hedge.
The documentation includes identification of the hedging
instrument, the hedged item, the nature of the risk being hedged
and how the Group will assess whether the hedging relationship
meets the hedge effectiveness requirements (including the
analysis of sources of hedge ineffectiveness and how the
hedge ratio is determined). A hedging relationship qualifies for
hedge accounting if it meets all of the following effectiveness
requirements:
• There is “an economic relationship” between the hedged item
and the hedging instrument.
• The effect of credit risk does not “dominate the value changes”
that result from that economic relationship.
• The hedge ratio of the hedging relationship is the same as that
resulting from the quantity of the hedged item that the Group
actually hedges and the quantity of the hedging instrument that
the Group actually uses to hedge that quantity of hedged item.
The full fair value of a hedging derivative is classified as a non-
current asset or liability when the remaining hedged item is
more than 12 months and as a current asset or liability when
the remaining maturity of the hedged item is less than 12
months.
Hedges that meet the strict criteria for hedge accounting are
accounted for, as described below:
1.27.1 Fair value hedges
Changes in the fair value of derivatives that are designated and
qualify as fair value hedges are recorded in the income statement,
together with any changes in the fair value of the hedged asset or
liability that are attributable to the hedged risk. The gain or loss
relating both to the effective and ineffective portion of interest
rate swaps hedging fixed rate borrowings is recognized in the
income statement within “Finance income/expense”
1.27.2 Cash flow hedges
The effective portion of gains or losses from measuring cash
flow hedging instruments is recognized in OCI and accumulated
in reserves, in the account “hedging reserve from cash flow
hedges”. The gain or loss relating to the ineffective portion is
recognized immediately in the income statement within “Finance
income/expenses”.
Amounts accumulated in equity are reclassified to profit or loss in
the periods when the hedged item affects profit or loss.
When a hedging instrument expires or is sold or terminated, or
when a hedge no longer meets the criteria for hedge accounting,
any cumulative gain or loss existing in equity at that time remains
in equity and is recognised when the forecast transaction is
ultimately recognised in profit or loss. When a forecast transaction
is no longer expected to occur, the cumulative gain or loss that
was reported in equity is immediately reclassified to profit or loss.
1.27.3 Net investment hedge
Hedges of net investments in foreign entities are accounted for
similarly to cash flow hedges. Where the hedging instrument is
a derivative, any gain or loss on the hedging instrument relating
to the effective portion of the hedge is recognised in currency
translation differences on derivative hedging position in other
reserves. The gain or loss relating to the ineffective portion is
recognised immediately in other income/expenses in the income
statement. However, where the hedging instrument is not a
derivative (for example, a foreign currency borrowing), all foreign
exchange gains or losses arising on the translation of a borrowing
that hedges such an investment (including any ineffective portion
of the hedge) are recognized in equity in “translation differences
on derivative hedging position” in “other reserves”.
Gains or losses accumulated in equity are included in the income
statement when the foreign operation is (partially or fully)
disposed of. The Group’s “other reserves” include gains that have
resulted from such hedging activities carried out in the past.
Derivatives that do not qualify for hedge accounting
Certain derivative transactions, do not qualify for hedge
accounting under rules in IFRS. Any gains or losses arising from
changes in the fair value of financial instruments that are not
part of a hedging relationship are included in finance income /
(expenses), gain / (loss) from foreign exchange differences and
cost of sales in the income statement for the period in which they
arise, depending on their nature.
1.28 De-recognition of financial assets and liabilities
1.28.1 Financial assets
A financial asset (or, where applicable a part of a financial asset or
part of a group of similar financial assets) is derecognized when:
• the rights to receive cash flows from the asset have expired;
• the Group retains the right to receive cash flows from the
asset, but has assumed an obligation to pay them in full
without material delay to a third party under a “pass-through”
arrangement; or
• the Group has transferred its rights to receive cash flows from
the asset and either (a) has transferred substantially all the risks
and rewards of the assets, or (b) has neither transferred nor
retained substantially all the risks and rewards of the asset, but
has transferred control of the asset.
Where the Group has transferred its rights to receive cash
flows from an asset and has neither transferred nor retained
substantially all the risks and rewards of the asset nor transferred
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
170
control of the asset, the asset is recognized to the extent of the
Group’s continuing involvement in the asset. A respective liability
is also recognized.
Continuing involvement that takes the form of a guarantee over
the transferred asset is measured at the lower of the original
carrying amount of the asset and the maximum amount of
consideration that the Group could be required to repay.
1.28.2 Financial liabilities
A financial liability is derecognized when the obligation under
the liability is discharged or cancelled or expires. Where an
existing financial liability is replaced by another from the same
lender on substantially different terms, or the terms of an
existing liability are substantially modified, such an exchange or
modification is treated as a de-recognition of the original liability
and the recognition of a new liability. The difference in the
respective carrying amounts is recognized in the consolidated
statement of income.
1.29 Borrowing costs
Borrowing costs directly attributable to the acquisition,
construction or production of a qualifying asset are capitalized as
part of the cost of the respective assets until such as the asset is
substantially ready for its intended use or sale. Qualifying assets
are assets that necessarily take a substantial period of time to
get ready for their intended use or sale. All other borrowing costs
are expensed in the profit of loss in the period in which they are
occurred. Borrowing costs consist of interest and other costs
that an entity incurs in connection with the borrowing of funds.
1.30 Trade payables
Trade payables are obligations to pay for goods or services
that have been acquired in the ordinary course of business
from suppliers. Accounts payable are classified as current
liabilities if payment is due within one year or less (or in the
normal operating cycle of the business if longer). If not, they are
presented as non-current liabilities.
Trade payables are recognised initially at fair value and
subsequently measured at amortised cost using the effective
interest method.
1.31 Gains/losses on disposal of non-current assets,
restructuring costs and other significant gains/losses
Gains/losses on disposal of non-current assets, restructuring
costs and other significant gains/losses are disclosed separately
in the financial statements where it is necessary to do so to
provide further understanding of the financial performance of
the group. They are material items of income or expense that
have been shown separately due to the significance of their
nature or amount.
2. Significant accounting estimates and judgments
The preparation of the financial statements requires
management to make estimations and judgments that affect
the reported disclosures. On an ongoing basis, management
evaluates its estimates, which are presented below.
Estimates and judgements are based on historical experience
and other factors, including expectations of future events that
are believed to be reasonable under the circumstances.
These management’s estimation and assumptions form the basis
for making judgments about the carrying value of assets and
liabilities that are not readily available from other sources. The
resulting accounting estimates will, seldom equal the related
actual results by definition. The estimates and assumptions
that have a significant risk of causing a material adjustment to
the carrying amounts of assets and liabilities within the next
financial year are discussed below:
2.1 Impairment of goodwill
Impairment tests for goodwill use the recoverable amounts of
cash-generating units that are determined based on value-in-
use calculations (note 13). These calculations require the use of
estimates, which mainly relate to future earnings and discount
rates.
2.2 Impairment of joint ventures
The determination of the recoverable amount for each joint
venture requires significant judgments in respect of assumptions
about the future results of the business and the discount rates
applied to future cash flow forecasts. In the Group’s view, a
statement that the impairment test of joint ventures includes
estimates that “have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities
within the next financial year” should be made.
2.3 Deferred tax assets
Deferred tax assets are recognized for unused tax losses to the
extent that it is probable that taxable profit will be available
against which the losses can be utilized. Significant management
judgment is required to determine the amount of deferred tax
assets that can be recognized, based upon the likely timing
and the level of future taxable profits together with future tax
planning strategies (note 8).
2.4 Useful lives and residual values
PPE are depreciated over their estimated useful lives. The actual
lives of the assets are assessed annually and may vary depending
on a number of factors. In reassessing asset lives, factors such
as technological innovation, product lifecycles, life-of-mine and
maintenance programmes are considered.
2.5 Provision for environmental rehabilitation
The Group recognizes provision for environmental rehabilitation
that is re-estimated on an annual basis. It reflects the present
value of the expected restoration costs, using estimated cash
flows and is calculated based on the area of the land disturbed
at the reporting date and the cost of rehabilitation per metric
unit of land at the level of the broader area of interest. Given the
complexity of the calculations and the significant assumptions
therein, management provides its best estimate in relation to
the present value of the aforementioned liability.
MANAGEMENT REPORT
FINANCIAL REVIEW
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
Information by operating segment
(all amounts in Euro thousands)
Greece and
Western Europe North America
South Eastern
Europe
Eastern
Mediterranean Total
Gross revenue 333,515 983,590 290,613 172,800 1,780,518
Inter-segment revenue -65,885 - -10 - -65,895
Revenue from external customers 267,630 983,590 290,603 172,800 1,714,623
Earnings before interest, taxes, depreciation, amortization
and impairment (EBITDA)
23,558 157,962 81,926 11,763 275,209
Depreciation, amortization and impairment of tangible and
intangible assets
-22,173 -69,969 -25,467 -18,872 -136,481
Operating profit before impairment losses on goodwill
1,385 87,993 56,460 -7,110 138,728
ASSETS
Property, plant & equipment 289,177 656,036 279,592 320,577 1,545,382
Intangible assets and goodwill 34,559 224,355 60,110 44,406 363,430
Other non-current assets 28,375 15,220 9,728 943 54,266
Current assets 197,290 237,698 117,716 81,296 634,000
Total assets of segments excluding joint ventures 549,401 1,133,309 467,146 447,222 2,597,078
Investment in joint ventures (note 15.2) 81,563
Total assets 2,678,641
LIABILITIES
Non-current liabilities 237,052 458,840 77,914 127,123 900,929
Current liabilities 132,875 185,244 69,171 53,536 440,826
Total liabilities 369,927 644,084 147,085 180,659 1,341,755
Capital expenditures (note 11,12,14) 24,601 79,562 15,369 6,512 126,044
Allowance for doubtful debtors (note 20) -456 -777 -370 -119 -1,722
Investment in associates (note 15) 3,398 - 3,792 - 7,190
Non-qualified deferred compensation plans (note 17,25)
- 3,307 - - 3,307
Non-current assets excluding financial instruments, deferred
tax assets and post employment benefit assets
330,757 880,370 347,984 364,922 1,924,033
3. Operating segment information
Revenue consists of the sale of goods and services. There are sales between operating segments. Total assets and capital expenditures are
presented in the operating segment of the company that owns the assets.
For the year ended 31 December 2021
Capital expenditures consist of additions of property, plant and equipment, intangible assets and investment property.
Impairment charges are included in the income statement.
Summarised financial information of the joint ventures, based on their IFRS financial statements, is disclosed in note 15.2.
For management information purposes, the Group is structured in five operating segments: Greece and Western Europe, North America, South
Eastern Europe, Eastern Mediterranean and Joint Ventures. Each operating segment is a set of countries. The aggregation of countries is based
mainly on geographic position.
Each region has a regional Chief Executive Officer (CEO) who is a member of the Group Executive Committee and reports to the Group's CEO. In
addition, the Group’s finance department is organized by region for effective financial control and performance monitoring.
Management monitors the operating results of its business units separately for the purpose of making decisions, allocating resources and assessing
performance. Segment performance is evaluated based on earnings before interest, taxes, depreciation, amortization & impairment (EBITDA).
EBITDA calculation includes the operating profit plus depreciation, amortization and impairment of tangible and intangible assets and amortization
of government grands.
171
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MANAGEMENT REPORT
FINANCIAL REVIEW
(all amounts in Euro thousands)
Cement
Ready mix concrete,
aggregates and
building blocks
Other activities Total
Revenue 1,011,199 692,751 10,673 1,714,623
Information by operating segment
(all amounts in Euro thousands)
Greece and
Western Europe North America
South Eastern
Europe
Eastern
Mediterranean Total
Gross revenue 308,778 939,747 270,952 151,748 1,671,225
Inter-segment revenue -64,192 - - - -64,192
Revenue from external customers 244,586 939,747 270,952 151,748 1,607,033
Earnings before interest, taxes, depreciation, amortization and
impairment (EBITDA) 16,246 176,397 96,202 -3,250 285,595
Depreciation, amortization and impairment of tangible and
intangible assets -21,893 -71,818 -26,206 -19,650 -139,567
Operating profit before impairment losses on goodwill -5,647 104,580 69,996 -22,901 146,028
ASSETS
Property, plant & equipment 286,912 604,241 286,841 351,249 1,529,243
Intangible assets and goodwill 35,035 200,647 60,180 56,430 352,292
Other non-current assets 32,267 8,465 8,847 1,275 50,854
Current assets 197,246 291,542 101,015 75,816 665,619
Total assets of segments excluding joint ventures 551,460 1,104,895 456,883 484,770 2,598,008
Investment in joint ventures (note 15.2) 78,188
Total assets 2,676,196
LIABILITIES
Non-current liabilities 193,509 350,594 97,938 213,550 855,591
Current liabilities 93,775 289,762 49,055 112,657 545,249
Total liabilities 287,284 640,356 146,993 326,207 1,400,840
Capital expenditures (note 11,12,14) 15,675 46,317 14,227 8,077 84,296
Impairment of property, plant and equipment (note 11) - -992 - -992
Impairment of Goodwill (note 13) - - - -46,614 -46,614
Allowance for doubtful debtors (note 20) -766 -461 -611 -147 -1,985
Investment in associates (note 15) 3,523 134 3,765 - 7,422
Non-qualified deferred compensation plans (note 17, 25) - 2,572 - - 2,572
Non-current assets excluding financial instruments, deferred tax
assets and post employment benefit assets 330,137 805,022 354,889 407,679 1,897,727
At Group level, "Revenue" is derived from a set of customers none of which separately represents greater than or equal to 10%.
The cement activity includes cement and cementitious materials.
Other activities include transportation services and the activity of Regulatory Electricity Market in Greece. None of these activities have the prerequisite
magnitude to be presented separately.
Greece and Western Europe segment is also engaged in the production and trade of dry mortars and the Regulatory Electricity Market. North America segment
includes the production and trade of building blocks and the processing of fly ash. Finally, South Eastern Europe and Eastern Mediterranean segments are
engaged in the processing of alternative fuels.
The business activities that are common to all segments of the Group are the production and trade of cement, ready-mix concrete, aggregates and
transportation services.
3.Operating segment information (continued)
For the year ended 31 December 2021
For the year ended 31 December 2020
Information by business activities
Segment information of 2020 was restated in order to be comparable with the corresponding segment information of 2021, as a result of Arresa Marine Co
change of operating segment.
restated
Summarised financial information of the joint ventures, based on their IFRS financial statements, is disclosed in note 15.2.
Capital expenditures consist of additions of property, plant and equipment, intangible assets and investment property.
Impairment charges are included in the income statement.
Revenue consists of the sale of goods and services. There are sales between operating segments. Total assets and capital expenditures are presented in the
operating segment of the company that owns the assets.
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TITAN CEMENT GROUP
(all amounts in Euro thousands)
Cement
Ready mix
concrete,
aggregates and
building blocks
Other activities Total
Revenue 896,137 705,138 5,758 1,607,033
(all amounts in Euro thousands)
2021 2020
restated
Operating profit before impairment losses on goodwill 138,728 146,028
Ιmpairment losses on goodwill - -46,614
Operating profit 138,728 99,414
Other income - 100
Finance income 4,255 636
Finance expenses -37,835 -53,197
Loss from foreign exchange differences
-73 -13,216
Share of profit of associates (note 15.1)
585 611
Share of profit of joint ventures (note 15.2)
2,706 2,589
Profit before taxes 108,366 36,937
i) Other operating income and expenses
(all amounts in Euro thousands)
2021 2020
Scrap sales 48 237
Income from services 1,215 1,375
Rental income 2,550 4,087
Gains on disposal of PPE, intangible assets and investment
property (note 11, 29)
5,747 1,094
Fair value gain from investment property (note 12) 333 -
Other income 835 759
Other income total 10,728 7,552
Fair value loss from investment property (note 12) - -94
Restructuring cost -255 -531
Various recurrent taxes - fees -354 -
Other expenses -222 -860
Other expenses total -831 -1,485
ii) Other income
(all amounts in Euro thousands) 2021 2020
Income from participations and investments - 100
Other income - 100
3. Operating segment information (continued)
Information by business activities
Reconciliation of profit
The restructuring cost relates to voluntary retirement incentive programs in all Group operating segments.
4. Other income and expenses
Net finance costs, and other income/loss are not allocated to individual segments as the underlying instruments are managed on a Group basis.
For the year ended 31 December 2020
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FINANCIAL REVIEW
(all amounts in Euro thousands) 2021 2020
restated
Staff costs and related expenses (note 7) -328,879 -312,692
Raw materials and consumables used -481,338 -421,729
Energy cost -279,296 -204,269
Changes in inventory of finished goods and work in progress 20,309 -12,096
Distribution expenses -183,784 -178,932
Third party fees -136,410 -129,896
Depreciation, amortization and impairment of tangible, intangible assets and government grants
(note 11,14,27)
-136,481 -139,567
Other expenses -58,191 -65,906
Total expenses by nature -1,584,070 -1,465,087
Included in:
Cost of sales -1,403,728 -1,297,763
Administrative expenses -153,951 -143,046
Selling and marketing expenses -26,391 -24,278
-1,584,070 -1,465,087
(all amounts in Euro thousands) 2021 2020
restated
i) Finance income
Interest income and related income 1,176 636
Fair value gains on derivatives 3,079 -
Finance income 4,255 636
ii) Finance expenses
Interest expense and related expenses -34,620 -46,222
Finance costs of actuarial studies (note 25) -186 -186
Unwinding of discount of rehabilitation and other provisions (note 26) -501 -730
Interest expense on lease liabilities -2,528 -2,811
Fair value losses on derivatives - -3,248
Finance expense -37,835 -53,197
iii) Loss from foreign exchange differences
Net exchange gains/(losses) 25,385 -46,458
Fair value (losses)/gains on derivatives -25,458 33,242
Losses from foreign exchange differences -73 -13,216
(all amounts in Euro thousands)
2021 2020
restated
Wages, salaries and related expenses 294,606 279,741
Social security costs 27,615 27,254
Share-based payment expense of 2020 plan (note 24)
2,829 1,394
Fair value of share options granted to directors and employees (note 29)
886 1,720
Other post retirement and termination benefits - defined benefit plans (note 25)
3,384 3,300
Total staff costs 329,320 313,409
The average number of Group employees for the fiscal year 2021 was 5,352 (2020: 5,363).
6. Net finance costs and foreign exchange differences
7. Staff costs
Losses from foreign exchange differences incorporate mainly the effects of changes in foreign exchange rates of intragroup loans and the fair value of
derivatives that hedge the volatility of foreign currencies associated with these intragroup loans (note 35a).
5. Expenses by nature
Moreover, the Group's costs in raw materials impacted by the rising import shipping freight costs, especially in the North America region.
In 2021, energy costs increased sharply. The Group faced unexpected spike of fuels (primarily pet coke and natural gas) and electricity costs, especially
in the second semester of the year. The negative impact affected all Group regions.
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INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
(all amounts in Euro thousands)
2021 2020
restated
Current tax 11,717 10,380
Deferred tax (note 18) 2,612 23,761
Non deductible taxes and differences from tax audit 2,482 1,636
16,811 35,777
(all amounts in Euro thousands)
2021 2020
restated
Profit before tax 108,366 36,937
Impairment of goodwill - -46,614
Profit before tax and impairment of goodwill 108,366 83,551
Tax calculated at the parent company tax rate of 12.5% (2020:12.5%) 13,546 10,444
Effect of different tax rates in the countries that the Group operates 5,695 1,098
Tax calculated at weighted average tax rate of 17.8% (2020: 14%) 19,241 11,542
Tax adjustments in respect of:
Income not subject to tax -2,226 -1,182
Expenses not deductible for tax purposes 4,969 7,669
Effect of change in tax rate 127 -
Utilization of prior years unrecognized losses -120 -15
Effect of unrecognized deferred tax asset on tax carry forward losses 1,898 5,148
Effect of de-recognition of net operating loss carryforwards - 12,198
Tax incentives -3,521 -3,374
Base Erosion and Anti-Abuse Tax 527 1,757
Tax on loss from disposal of treasury shares -6,174 -
Change in recognition of net operating loss carryforwards -46 862
Other 2,136 1,172
Effective tax charge 16,811 35,777
On 31 December 2021, certain Group entities had tax carry forward losses of €127.4 million (2020: €115.5 million). These entities have recognized
deferred tax assets amounting to €22.4 million (2020: 21.8 million), attributable to losses amounting to €93.2 million (2020: €86.2 million), as these
deferred tax assets will be recoverable using the estimated future taxable income based on approved business plans (note 18).
Deferred tax assets are recognized for the carryforwards of unused tax losses to the extent that it is probable that future taxable profit will be
available against which the losses can be utilized. The calculation of the tax carry-forward receivable to be recognized requires management judgment
in assessing future profitability and recoverability (note 2.3).
Τhe profit before tax of the Group companies is taxed at the applicable rate corresponding to the country in which each company is domiciled. The
local income tax rates vary, thus resulting in corresponding tax rate differentials.
A weighted average tax rate is determined by taking tax rate differentials into account.
The following table provides the reconciliation of prima facie tax payable to income tax expense
:
The Group's subsidiary in USA, Titan America LLC on 31.12.2020 had net operating losses carryforwards of €15.3 million which were utilized in 2021.
For the remaining €34.2 million tax carry forward losses, no deferred tax asset has been recognized, since they did not meet the recognition criteria
according to IAS 12. Tax carry forward losses amounting to €24.9 million and €7.9 million expire up to 2025 and 2026 respectively, while losses
amounting to €1.4 million may be carried forward indefinitely.
8. Income tax expense
Tax reconciliation
176
MANAGEMENT REPORT
FINANCIAL REVIEW
(all amounts in Euro thousands unless otherwise stated)
2021 2020
restated
Net profit for the year attributable to equity holders of the parent
91,923 1,126
Weighted average number of ordinary shares in issue 74,795,239 77,133,713
Basic earnings per ordinary share (in €) 1.2290 0.0146
(all amounts in Euro thousands unless otherwise stated)
2021 2020
restated
Net profit for the year attributable to equity holders of the parent
91,923 1,126
Weighted average number of ordinary shares for diluted earnings per share
74,795,239 77,133,713
Share options and awards 294,514 256,516
Total weighted average number of shares in issue for diluted earnings per share
75,089,753 77,390,229
Diluted earnings per ordinary share (in €) 1.2242 0.0145
Following the authorization granted to the Board of Directors by the Extraordinary Meeting of the company’s Shareholders on the 13th of May
2019, the Board of Directors of Titan Cement International SA decided on the 22nd of March 2021 the return of capital of €0.40 (40 cents) per
share to all the Shareholders of the Company on record on the 29th of April 2021.
9.Earnings per share
10. Dividends and return of capital
For the year ended 31.12.2020
Following the authorization granted to the Board of Directors by the Extraordinary Meeting of the Company's Shareholders on 13 May 2019, the
Board of Directors of Titan Cement International SA decided on the 16th of March 2022 the return of capital of €0.50 (50 cents) per share to all the
Shareholders of the Company on record on 28th of April 2022.
Basic earnings per share are calculated by dividing the net profit attributable to shareholders for the year by the weighted average number of
shares in issue during the year, excluding shares purchased by the Group and held as treasury shares.
Diluted EPS is calculated by dividing the profit attributable to ordinary equity holders of the parent by the weighted average number of ordinary
shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive
potential ordinary shares into ordinary shares. Options granted to employees under the Group’s plans 2014 and 2017 (note 24) are considered to
be potential ordinary shares.
For the year ended 31.12.2021
177
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
(all amounts in Euro thousands)
Land Quarries Buildings
Plant &
equipment Motor vehicles
Office furniture,
fixtures and
equipment
Assets under
construction
Total
Opening balance 253,640 134,805 211,496 880,352 71,136 12,904 72,909 1,637,242
Additions 41 1,747 309 3,402 227 668 56,071 62,465
Provisions for restoration 191 826 98 6,680 - - -432 7,363
Additions due to acquisition - - 133 29 - - - 162
Interest capitalization - - - - - 1,008 1,008
Disposals (NBV) -793 - -123 -108 -72 -31 - -1,127
Reclassification of assets from/to other PPE categories 784 338 5,674 39,306 3,329 2,361 -51,590 202
Transfers from/to other accounts 13 - 45 -206 -31 -146 515 190
Depreciation charge (note 29) -3,789 -9,911 -11,774 -74,363 -14,603 -4,267 - -118,707
Impairment of PPE (note 29) -944 - -42 -6 - - - -992
Exchange differences -16,422 -9,099 -14,890 -58,814 -4,514 -359 -6,498 -110,596
Ending balance 232,721 118,706 190,926 796,272 55,472 11,130 71,983 1,477,210
Opening balance 12,338 - 17,176 13,657 14,254 58 - 57,483
Additions 2,294 - 6,487 3,515 2,026 - - 14,322
Disposals (NBV)
- - 1 -790 -100 - - -889
Reclassification of assets from ROU's to PPE - - - -75 -127 - - -202
Depreciation charge (note 29, 33) -1,472 - -4,493 -4,319 -4,554 -36 - -14,874
Exchange differences -1,125 - -955 -915 -812 - - -3,807
Ending balance 12,035 - 18,216 11,073 10,687 22 - 52,033
At 31 December 2020
Cost 305,220 217,785 452,991 1,897,048 260,036 62,441 72,478 3,267,999
Accumulated depreciation -55,200 -99,079 -242,910 -1,083,204 -193,873 -51,277 - -1,725,543
Accumulated losses of impairment of PPE
-5,264 - -939 -6,499 -4 -12 -495 -13,213
Net book value 244,756 118,706 209,142 807,345 66,159 11,152 71,983 1,529,243
Year ended 31 December 2020
11. Property, plant and equipment
Right of use assets
178
MANAGEMENT REPORT
FINANCIAL REVIEW
11. Property, plant and equipment (continued)
(all amounts in Euro thousands)
Land Quarries Buildings
Plant & equipment Motor vehicles
Office furniture,
fixtures and
equipment
Assets under
construction
Total
Opening balance 232,721 118,706 190,926 796,272 55,472 11,130 71,983 1,477,210
Additions 60 6,178 101 2,399 380 769 90,077 99,964
Interest capitalization - - - - - - 461 461
Disposals (NBV) -824 - -138 -217 -110 -1 -178 -1,468
Reclassification of assets from/to other PPE categories
283 - 2,283 58,473 18,906 3,605 -78,155
5,395
Transfers from/to other accounts 1 -471 54 477 - -12 -3,724 -3,675
Depreciation charge (note 29) -3,249 -10,975 -10,817 -72,946 -14,682 -3,848 - -116,517
Exchange differences 13,080 8,007 -4,553 3,177 3,541 66 5,876 29,194
Ending balance 242,072 121,445 177,856 787,635 63,507 11,709 86,340 1,490,564
Opening balance 12,035 - 18,216 11,073 10,687 22 - 52,033
Additions 272 - 5,184 10,884 2,606 - - 18,946
Disposals (NBV) - - -43 -67 -88 - - -198
Reclassification of assets from ROU's to PPE
- - - -1,257 -4,138 - -
-5,395
Depreciation charge (note 29, 33) -1,459 - -4,869 -4,501 -3,116 -19 - -13,964
Exchange differences 923 - 932 1,136 405 - - 3,396
Ending balance 11,771 - 19,420 17,268 6,356 3 - 54,818
At 31 December 2021
Cost 323,716 239,047 457,687 2,005,400 292,025 59,930 86,877
3,464,682
Accumulated depreciation -64,375 -117,602 -259,472 -1,194,052 -222,162 -48,206 - -1,905,869
Accumulated losses of impairment of PPE
-5,498 - -939 -6,445 - -12 -537
-13,431
Net book value 253,843 121,445 197,276 804,903 69,863 11,712 86,340 1,545,382
Year ended 31 December 2021
Right of use assets
179
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
(all amounts in Euro thousands)
2021 2020
Opening balance 11,720 11,628
Disposals -1,043 -
Net gain from measurement at fair value (note 4) 575 162
Transfer to assets held for sale -238 -
Transfer to property, plant and equipment -38 -58
Exchange differences 4 -12
Ending balance
10,980 11,720
(all amounts in Euro thousands) 2021 2020
Rental income derived from investment property
426 428
Direct operating expenses (including repair and maintenance) that did not generate rental
income
-73 -63
Net profit arising from investment properties carried at fair value
333 -94
(all amounts in Euro thousands) 2021 2020
Within one year 522 467
Between 1 and 2 years 415 408
Between 2 and 3 years 334 313
Between 3 and 4 years 246 242
Between 4 and 5 years 228 153
Later than five years 574 544
2,318 2,127
12. Investment propert
y
Property that is leased among Group subsidiaries is not included in investment property but in property, plant and equipment in the Group
statement of financial position. Investment property is measured at fair value by external, independent, certified valuators, members of the
institute of the certified valuators and certified from the European Group of Valuers' Associations (TEGoVA) & RICS (Royal Institution of Chartered
Surveyors).
Investment property is measured at fair value on a yearly basis. The fair value measurement of the investment property of the Group has been
mainly conducted in accordance with the comparative method or the current market values of similar properties. The main factors that were taken
into consideration, are the property location, the surface area, the local urban planning, the bordering road networks, the regional infrastructure,
the property maintenance status and merchantability, the technical construction standards in the case of buildings and the impact of
environmental issues if any.
The investment properties are leased to tenants under operating leases with rentals payable monthly, quarterly or yearly. Lease payments for some
contracts include Consumer Price Index (CPI) increases, but there are no other variable lease payments that depend on an index or rate.
Minimum lease payments receivable on leases of investment properties are as follows:
The Board of Directors of the Group subsidiary in Greece, Titan Cement S.A., decided to sell its land plots located in Elefsina-Attika. In December
2021, the plots were sold at a selling price of €7.1 million, resulting in a gain of €6.1 million. A small part of the land plots with a carrying amount of
€238 thousand was classified as forest area by the Forest State Office, which resulted in a delay in completing the sale within 2021. Its sale is
expected to be made during 2022 with a selling price of €500 thousand, resulting in a gain of €262 thousand.
11. Property, plant and equipment (continued)
On the Turkish subsidiaries Adocim Cimento Beton Sanayi ve Ticaret A.S. and Adocim Marmara Cimento Beton Sanayi ve Ticaret A.S. assets, there
are mortgages of €29.31 million and €0 million respectively, securing bank credit facilities. As at 31.12.2021, utilization under these credit facilities
amounted to €3.72 million and nil respectively.
In 2020, the Group recorded impairment losses of €992 thousand, that were presented in the cost of sales in the consolidated income statement.
Specifically, the amount of €944 thousand was recorded for a plot of land, €42 thousand for buildings and €6 thousand for machineries in Bulgaria.
On 31.12.2020, their recoverable amount was estimated to be €1,516 thousand.
Disposal of assets
During 2021, the Group received €8,694 thousand (2020: €3,110 thousand) from the disposal of tangible/intangible assets and investment property
with total net book value of €2,947 thousand (2020: €2,016 thousand). Thus, the Group recognized €5,747 thousand gains (2020: €1,094 thousand
gains) on disposal of PPE in the consolidated income statement (note 4).
Impairments of property, plant and equipment
Property, plant and equipment pledged as securit
y
180
MANAGEMENT REPORT
FINANCIAL REVIEW
(all amounts in Euro thousands)
Initial goodwill Goodwill impairment Total goodwill
Balance at 1 January 2020 362,351 -17,828 344,523
Additions due to acquisition 6 - 6
Impairment (note 29) - -46,614 -46,614
Exchange differences -29,705 -197 -29,902
Balance at 31 December 2020 332,652 -64,639 268,013
Balance at 1 January 2021 332,652 -64,639 268,013
Exchange differences 1,207 2,766 3,973
Balance at 31 December 2021 333,859 -61,873 271,986
.H\DVVXPSWLRQV
Sales volumes:
13. Goodwill
Impairment testing of goodwill
Terminal value and Perpetual growth rates:
Terminal value cash flows are based on the long-term growth expectations for the industry in the country of operation. It is calculated based on
sustainable sales volumes, capacity utilization, EBITDA margin and CAPEX, to reflect sustainable cash flows in perpetuity. Perpetuity Growth rates
are in line with the nominal economic growth. Rates are reasonably compared to long-term inflation expectations, adjusted for per capita
consumption expectations and capacity utilization. Inputs that have been taken into consideration are estimates from international agencies’ or
banks’ forecasts.
Group cash-generating-units (CGUs) are defined generally as a country or group area on the basis of the sales and management structure. The
recoverable amount of all CGUs has been determined based on value-in-use calculations. These calculations use post-tax cash flow projections based
on financial budgets approved by management covering generally a five-year period. Forecasts rely on a combination of internal and external factors
that influence each CGU operations. Furthermore, in specific circumstances, when recent results of a CGU do not reflect historical performance and
most external economic variables provide confidence that a reasonably determinable improvement is expected in the mid-term, management uses
cash flow projections over a period up to 10 years, to reflect sufficiently the cyclical nature of the industry.
The calculation of value-in-use for the Group's evaluated CGUs is most sensitive to the following assumptions:
Input cos
t
evolut
i
on, ma
i
nly cons
i
st
i
n
g
o
f
thermal and electr
i
cal energy, transportat
i
o
n
costs
,
and raw mater
i
al costs
,
are determ
i
ned by
f
orecasted
projections provided by international agencies and institutions. Furthermore, actions for mitigating supply chain disruption and the curtailment of th
e
group’s environmental footprint are factored-in.
Volume assumptions are provided by local management and reflect its best estimates taking into consideration: past performance, local market
growth estimates, infrastructure projects, etc. Sales volume growth rates are also based on published industry research and take into account
demographic trends including population growth, household formation, and economic output (among other factors) in the countries where the Group
operates.
Selling prices and cost:
Price assumptions are provided by local management and reflect its best estimates. Factors that have been taken into consideration are: historical
trends, inflation, brand loyalty, growth rate of the regional economy, competition, production cost increases, etc.
181
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
(all amounts in Euro thousands)
Carrying amount of
goodwill Perpetual Growth rates Discount rates
North America 193,113 2%-3% 5.6%
Bulgaria 45,440 1.5% 4.7%
Turkey 16,294 11% 24.7%
Other 17,139 0.8%-1.4% 5.2%-7.1%
Total 271,986
(all amounts in Euro thousands)
Carrying amount of
goodwill Perpetual Growth rates Discount rates
North America 178,246 2%-3% 3.8%-5.1%
Bulgaria 45,440 1.3% 3%
Egypt - 7.3% 17.60%
Turkey 27,238 9.5% 15.9%
Other 17,089 0.8%-2.4% 2.2%-6.9%
Total 268,013
13. Goodwill (continued)
-Increase in the Discount rate by: 3.8% for Bulgaria and 6.4% for Turkey.
-Decrease in the operating margin (EBITDA margin) for each year of planning as well as in the terminal value of around 8.9% for Bulgaria and 8.6% for
Turkey.
Key assumptions used for value in use calculations in respect of goodwill 2020
Sensitivity of recoverable amounts
Discount rates:
Discount rates are according to post tax weighted average cost of capital (WACC) for each CGUs, deriving from Group’s current market risk
assessment, applicable local tax rates and local currency risk free rates.
Key assumptions used for value in use calculations in respect of goodwill 2021
On 31.12.2021, the Group analyzed the sensitivities of the recoverable amounts to the reasonably change in key assumptions. For all CGUs the
sensitivity analysis did not present a situation in which the carrying value of the CGU would exceed their recoverable amount.
With respect to Bulgaria and Turkey additional sensitivity analysis have been performed in order to assess the changes in the operational plan used for
cash flow estimates or the discount rate, which would cause the carrying amount to be equal to the recoverable amount.
182
MANAGEMENT REPORT
FINANCIAL REVIEW
14. Intangible assets
(all amounts in Euro thousands)
Licences Trademarks
Customer
relationships
Computer
software
Other
intangible
assets
Assets under
construction Total
Balance at 1 January 2020 38,508 16,123 5,791 1,219 4,162 19,367 85,170
Additions 72 - - 63 137 7,237 7,509
Additions due to acquisition - - - - 5 - 5
Reclassification of assets from/to other intangible assets categories - - - 2,950 111 -3,061 -
Transfers from other accounts - - - 260 -2 -190 68
Amortization charge (note 29) -1,112 -916 -1,710 -918 -544 - -5,200
Exchange differences -1,597 -1,162 -283 -15 -128 -88 -3,273
Balance at 31 December 2020 35,871 14,045 3,798 3,559 3,741 23,265 84,279
Balance at 1 January 2021 35,871 14,045 3,798 3,559 3,741 23,265 84,279
Additions 6 - - 157 198 6,773 7,134
Disposals (NBV) (note 29)
- - - - -238 - -238
Reclassification of assets from/to other intangible assets categories 411 - - 5,827 345 -6,583 -
Transfers from other accounts - - - 18,435 47 -16,242 2,240
Amortization charge (note 29)
-1,146 -877 -1,659 -1,991 -532 - -6,205
Exchange differences
1,701 1,044 228 -21 121 1,161 4,234
Balance at 31 December 2021 36,843 14,212 2,367 25,966 3,682 8,374 91,444
183
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
15.1 Investment in associates
(all amounts in Euro thousands)
2021 2020
Summarized statement of financial position as at 31 December
Non-current assets 17,686 26,617
Current assets 6,377 7,087
Total assets 24,063 33,704
Non-current liabilities 1,663 1,879
Current liabilities 6,864 7,198
Total liabilities 8,527 9,077
Equity 15,536 24,627
Summarized income statement and statement of comprehensive income for the
year ended 31 December
Revenue 15,233 20,306
(Loss)/profit after taxes -6,384 1,049
Other comprehensive losses for the year -10 -30
Total comprehensive (loss)/income for the year net of tax -6,394 1,019
Reconciliation to carrying amounts:
Opening net assets 1 January 24,627 32,009
(Loss)/profit for the year -6,384 1,049
Other comprehensive losses for the year -10 -30
Share capital increase -700 740
Dividends paid -1,839 -6,173
Foreign exchange differences 235 -915
Restructuring -393 -2,053
Closing net assets 15,536 24,627
Adjustments due to unrecognized fair value gain on assets contributed to associate -4,318 -4,665
Accumulated depreciation adjustments related to unrecognized fair value 4,318 1,272
Group's carrying amount of the investment after adjustments 7,190 7,422
15. Investments in associates, joint ventures and subsidiaries
Based on their contribution in its profit before taxes, the Group decided that each one of the aforementioned associates is individually immaterial
and thus it discloses in aggregate its interests in these associates as follows:
None of the aforementioned companies is listed on a public exchange market.
The Group financial statements incorporate the following companies with the equity method of consolidation:
a) Karierni Materiali Plovdiv AD with ownership percentage 48.711% (31.12.2020: 48.711%), Karierni Materiali AD with ownership percentage 48.764%
(31.12.2020: 48.764%). The aforementioned companies are based in Bulgaria and operate in the aggregates business.
b) Ecorecovery S.A. with ownership percentage 48% (31.12.2020: 48%). Ecorecovery is based in Greece and it processes, manages and trades solid
waste for the production of alternative fuels.
c) ASH Venture LLC with ownership percentage 33% (31.12.2020: 33%) which beneficiates, markets and sells fly ash. ASH Venture LLC is based in
USA.
184
MANAGEMENT REPORT
FINANCIAL REVIEW
15.2 Investment in joint ventures
(all amounts in Euro thousands)
2021 2020
Summarized statement of financial position as at 31 December
Non-current assets 124,251 126,497
Other current assets 42,544 34,130
Cash and cash equivalents 6,213 10,866
Total assets 173,008 171,493
Long-term borrowings 59,009 52,461
Other non-current liabilities 689 701
Short-term borrowings 21,192 40,653
Other current liabilities 27,991 19,477
Total liabilities 108,881 113,292
Equity 64,127 58,201
1.1 - 31.12.2021 1.1 - 31.12.2020
Summarized income statement and statement of comprehensive income
Revenue 83,845 70,727
Depreciation, amortization and impairments of assets -8,363 -8,548
Finance income 623 779
Finance expense -7,364 -8,319
Income tax --
Profit after taxes 5,411 5,176
Total comprehensive profit/(loss) for the year net of tax 5,411 5,176
Earnings before interest, taxes, depreciation, amortization and impairment (EBITDA)
19,524 19,409
2021 2020
Reconciliation to carrying amounts:
Opening net assets 1st January 58,201 74,155
Profit for the year 5,411 5,176
Foreign exchange differences 515 -21,130
Closing net assets 31th December 64,127 58,201
Group's share in % 50% 50%
Group's share in '000 € 32,064 29,101
Goodwill 49,499 49,087
Carrying amount of the investment as at 31st of December 81,563 78,188
Companhia Industrial De Cimento
Apodi - Consolidated *
* Consolidated figures before elimination with the broader Group
15.Investments in associates, joint ventures and subsidiaries (continued)
On 31 December 2021, the Group incorporated in its financial statements the following joint ventures with the equity method of consolidation.
a) Companhia Industrial De Cimento Apodi with ownership percentage 50% (31.12.2020: 50%). Apodi is based in Brazil and operates in the production
of cement.
b) Apodi Distribuição e Logistica Ltda with ownership percentage 50% (31.12.2020: 50%). The Apodi Distribuição e Logistica Ltda is a trading company
based in Brazil.
None of the aforementioned companies is listed on a public exchange market.
Summarised financial information of the joint ventures, based on their IFRS financial statements, and reconciliation with carrying amount of the
investment in consolidated financial statements are set out below:
- Increase in the Discount rate by 3.3%.
- Decrease in the operating margin (EBITDA margin) for each year of planning as well as in the terminal value of around 7.5%.
On 31.12.2021, the Group carried out an impairment test for the carrying value of the Brazilian CGU. The recoverable amount, which has been
determined based on value-in-use calculations with a discount rate of 13.8% and a perpetual growth rate of 3.25%, exceeds the carrying value.
Additional sensitivity analysis has been performed in order to assess the changes in the operational plan used for cash flow estimates or the discount
rate, which would cause the carrying amount to be equal to the recoverable amount.
185
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
(all amounts in Euro thousands)
2021 2020
Summarized statement of financial position as at 31 December
Non-current assets 58,567 97,229
Current assets 15,791 19,076
Total assets 74,358 116,305
Non-current liabilities
14,459 17,266
Current liabilities
18,416 22,471
Total liabilities 32,875 39,737
Equity 41,483 76,568
Attributable to:
Equity holders of the parent 31,112 57,426
Non-controlling interests (25%) 10,371 19,142
1.1 - 31.12.2021 1.1 - 31.12.2020
Summarized income statement and statement of comprehensive income
Revenue 39,292 40,984
Loss after taxes -5,805 -4,594
Other comprehensive losses for the year -29,290 -27,742
Total comprehensive losses for the year net of tax -35,095 -32,336
Total comprehensive losses attributable to non-controlling interests -8,773 -8,084
Summarized cash flow information
Cash flows from operating activities 20 842
Cash flows from investing activities -2,958 -1,457
Cash flows from financing activities 2,084 -105
Net decrease in cash and cash equivalents -854 -720
Cash and cash equivalents at beginning of the period
874 1,952
Effects of exchange rate changes
53 -358
Cash and cash equivalents at end of the year 73 874
15. Investments in associates, joint ventures and subsidiaries (continued)
15.3 Subsidiaries with significant percentage of non-controlling interests
* Figures before elimination with the broader Group
The following table summarizes the financial information of subsidiary Adocim Cimento Beton Sanayi ve Ticaret A.S. in which the non-controlling
interests held significant portion (note 16).
On 31.12.2021, the Group non-controlling interest was €15.3 million (2020: €24.0 million) of which €10.4 million (2020: €19.1 million) derived from
Adocim Cimento Beton Sanayi ve Ticaret A.S., €0.7 million (2020: €0.6 million) from Alexandria Portland Cement Co. S.A.E., €3.0 million (2020: €3.0
million) from Usje Cementarnica AD and €1.1 million (2020: €1.1 million) from Cement Plus LTD.
Adocim Cimento Beton Sanayi ve Ticaret
A.S.*
186
MANAGEMENT REPORT
FINANCIAL REVIEW
16. Principal subsidiaries, associates and joint ventures
Subsidiary, associate and joint venture name
Country of
incorporation Nature of business Direct Indirect Direct Indirect
Full consolidation method
Titan Cement International S.A. Belgium Investment holding company
Τitan Cement Company S.A Greece Cement producer 100.000 - 100.000
Aitolika Quarries S.A. Greece Quarries & aggregates - 63.723 - 63.723
Albacem S.A. Greece Trading company - 100.000 - 100.000
Interbeton Construction Materials S.A. Greece Ready mix & aggregates - 100.000 - 100.000
Intertitan Trading International S.A. Greece Trading company - 100.000 - 100.000
Gournon Quarries S.A. Greece Quarries & aggregates - 100.000 - 100.000
Quarries of Tagaradon Community S.A. Greece Quarries & aggregates - 67.587 - 67.587
Vahou Quarries S.A. Greece Quarries & aggregates - 100.000 - 100.000
Sigma Beton S.A. Greece Quarries & aggregates - 100.000 - 100.000
Titan Atlantic Cement Industrial &
Commercial S.A. Greece Investment holding company - 100.000 - 100.000
Titan Cement International Trading S.A. Greece Trading company - 100.000 - 100.000
Brazcem Participacoes S.A. Brazil Investment holding company - 100.000 - 100.000
Double W & Co OOD Bulgaria Port - 99.989 - 99.989
Granitoid AD Bulgaria Trading company - 99.760 - 99.760
Gravel & Sand PIT AD Bulgaria Quarries & aggregates - 99.989 - 99.989
Trojan Cem EOOD Bulgaria Trading company - 95.000 - 95.000
Zlatna Panega Cement AD Bulgaria Cement producer - 99.989 - 99.989
Green Alternative Energy Assets EAD Bulgaria Alternative fuels - 100.000 - 100.000
Cementi ANTEA SRL Italy Trading company - 100.000 - 100.000
Cementi Crotone S.R.L. Italy Import & distribution of Cement - 100.000 - 100.000
Fintitan SRL Italy Import & distribution of cement - 100.000 - 100.000
Separation Technologies Canada Ltd Canada Processing of fly ash - 100.000 - 100.000
Alexandria Development Co.Ltd (3) Cyprus Investment holding company - 100.000 - 100.000
Titan Eastmed Investments Limited (4) Cyprus Investment holding company - 100.000 - 100.000
Alvacim Ltd Cyprus Investment holding company - 100.000 - 100.000
East Cement Trade Ltd Cyprus Investment holding company - 100.000 - 100.000
Feronia Holding Ltd Cyprus Investment holding company - 100.000 - 100.000
Iapetos Ltd Cyprus Investment holding company - 100.000 - 100.000
KOCEM Limited Cyprus Investment holding company - 100.000 - 100.000
Rea Cement Investments Limited (1) Cyprus Investment holding company - 100.000 - -
Themis Holdings Ltd Cyprus Investment holding company - 100.000 - 100.000
Titan Cement Cyprus Limited Cyprus Investment holding company - 100.000 - 100.000
Tithys Holdings Limited Cyprus Investment holding company 100.000 - 100.000 -
Alexandria Portland Cement Co. S.A.E (2) Egypt Cement producer - 99.605 - 99.601
Beni Suef Cement Co.S.A.E. (2) Egypt Cement producer - 100.000 - 99.602
GAEA -Green Alternative Energy Assets (2) Egypt Alternative fuels - 99.996 - 99.992
Titan Beton & Aggregate Egypt LLC (2) Egypt Quarries & aggregates - 99.611 - 99.608
Sharr Beteiligungs GmbH Germany Investment holding company - 100.000 - 100.000
Arresa Marine Co Marshall Islands Shipping - 100.000 - 100.000
Adocim Marmara Cimento Beton Sanayi ve
Ticaret A.S. Turkey
Processing and trading of
cement - 100.000 - 100.000
Adocim Cimento Beton Sanayi ve Ticaret A.S. Turkey Cement producer - 75.000 - 75.000
Titan Cement U.K. Ltd U.K. Import & distribution of cement - 100.000 - 100.000
Titan Global Finance PLC U.K. Financial services 100.000 - 100.000 -
Carolinas Cement Company LLC U.S.A. Own/develop real estate - 100.000 - 100.000
Essex Cement Co. LLC U.S.A. Trading company - 100.000 - 100.000
Markfield America LLC U.S.A. Insurance company - 100.000 - 100.000
Massey Sand and Rock Co U.S.A. Quarries & aggregates - 100.000 - 100.000
Mechanicsville Concrete LLC U.S.A. Ready mix - 100.000 - 100.000
Metro Redi-Mix LLC U.S.A. Ready mix - 100.000 - 100.000
Miami Valley Ready Mix of Florida LLC U.S.A. Ready mix - 100.000 - 100.000
(*) Percentage of investment represents both percentage of shareholding and percentage of control
2021 2020
% of investment (*) % of investment (*)
Parent company Parent company
187
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
16. Principal subsidiaries, associates and joint ventures (continued)
Subsidiary, associate and joint venture name
Country of
incorporation Nature of business Direct Indirect Direct Indirect
Full consolidation method
Pennsuco Cement Co. LLC U.S.A. Cement producer - 100.000 - 100.000
Norfapeake Terminal LLC U.S.A. Trading company - 100.000 - 100.000
Roanoke Cement Co. LLC U.S.A. Cement producer - 100.000 - 100.000
S&W Ready Mix Concrete Co. Inc. U.S.A. Ready mix - 100.000 - 100.000
S&W Ready Mix LLC U.S.A. Ready mix - 100.000 - 100.000
Separation Technologies LLC U.S.A. Processing of fly ash - 100.000 - 100.000
Standard Concrete LLC U.S.A. Trading company - 100.000 - 100.000
ST Mid-Atlantic LLC U.S.A. Processing of fly ash - 100.000 - 100.000
ST Equipment & Technology LLC
U.S.A.
Sales of fly ash processing
equipment - 100.000 - 100.000
ST Equipment & Technology Trading
Company LLC U.S.A. Trading company - 100.000 - 100.000
Summit Ready-Mix LLC U.S.A. Ready mix - 100.000 - 100.000
Titan Florida LLC U.S.A. Cement producer - 100.000 - 100.000
Titan Mid-Atlantic Aggregates LLC U.S.A. Quarries & aggregates - 100.000 - 100.000
Titan Virginia Ready Mix LLC U.S.A. Ready mix - 100.000 - 100.000
Τitan Αmerica LLC U.S.A. Investment holding company - 100.000 - 100.000
Trusa Realty LLC U.S.A. Real estate brokerage - 100.000 - 100.000
Cementara Kosjeric AD Serbia Cement producer - 100.000 - 100.000
Stari Silo Company DOO Serbia Trading company - 100.000 - 100.000
TCK Montenegro DOO Montenegro Trading company - 100.000 - 100.000
Esha Material DOOEL North Macedonia Quarries & aggregates - 100.000 - 100.000
GAEA Zelena Alternative Enerjia DOOEL North Macedonia Alternative fuels - 100.000 - 100.000
ID Kompani DOOEL North Macedonia Trading company - 95.000 - 95.000
MILLCO-PCM DOOEL North Macedonia machines, equipment and - 100.000 - 100.000
Opalit DOOEL
North Macedonia Quarries & aggregates
-
95.000
- 95.000
Rudmak DOOEL
North Macedonia Trading company
-
100.000
- 100.000
Usje Cementarnica AD
North Macedonia Cement producer
-
95.000
- 95.000
Vesa DOOL
North Macedonia Trading company
-
100.000
- 100.000
Cement Plus LTD Kosovo Trading company - 64.999 - 64.999
Esha Material LLC Kosovo Quarries & aggregates - 100.000 - 100.000
Kosovo Construction Materials L.L.C.
Kosovo Quarries & aggregates
-
100.000
- 100.000
Sharrcem SH.P.K. Kosovo Cement producer - 100.000 - 100.000
Alba Cemento Italia, SHPK Albania Trading company - 100.000 - 100.000
Antea Cement SHA Albania Cement producer - 100.000 - 100.000
GAEA Enerjia Alternative e Gjelber Sh.p.k.
Albania Alternative fuels
-
100.000
- 100.000
Colombus Properties B.V.
Holland Investment holding company
-
100.000
- 100.000
Salentijn Properties1 B.V.
Holland Investment holding company
-
100.000
- 100.000
Titan Cement Netherlands BV Holland
Investment holding company
- 100.000 - 100.000
Equity consolidation method
Companhia Industrial De Cimento Apodi S.A. Brazil Cement producer - 50.000 - 50.000
Apodi Concretos Ltda Brazil Ready mix
- 50.000 - 50.000
Apodi Distribuição e Logistica Ltda Brazil Trading company
- 50.000 - 50.000
ASH Venture LLC U.S.A. Processing of fly ash
- 33.000 - 33.000
Ecorecovery S.A. Greece
Engineering design services for
solid and liquid waste facilities - 48.000 - 48.000
Karierni Materiali Plovdiv AD
Bulgaria Quarries & aggregates
- 48.711 - 48.711
Karierni Materiali AD
Bulgaria Quarries & aggregates
- 48.764 - 48.764
(*) Percentage of investment represents both percentage of shareholding and percentage of control
2021 2020
% of investment (*) % of investment (*)
188
MANAGEMENT REPORT
FINANCIAL REVIEW
(all amounts in Euro thousands) 2021 2020
Utility deposits 5,197 2,759
Excess benefit plan assets (note 25) 3,307 2,572
Other non-current assets 10,052 11,626
18,556 16,957
(all amounts in Euro thousands) 2021 2020
restated
Deferred tax assets to be recovered:
after more than 12 months -78,992 -91,911
within 12 months -14,877 -10,507
Deferred tax liabilities to be used:
after more than 12 months 185,806 174,069
within 12 months 12,800 17,963
Deferred tax liability (net)
104,737 89,614
(all amounts in Euro thousands) 2021 2020
restated
Opening balance, net deferred liability 89,614 84,866
Income statement charge (note 8) 2,612 23,761
Tax charged to equity through other comprehensive income 1,118 -1,109
Tax charged to equity 9,610 -5,294
Deferred tax adjustment on revaluation reserves 213 -1,489
Exchange differences 1,570 -11,121
Ending balance, net deferred liability 104,737 89,614
The movement in the deferred income tax account after set-offs is as follows:
Deferred income taxes are calculated in full on temporary differences under the liability method using the principal tax rates that apply to the
countries in which the companies of the Group operate.
17. Other non-current assets
18. Deferred income taxes
16. Principal subsidiaries, associates and joint ventures (continued)
4) In May 2021, Titan Egyptian Investments Limited changed its name to Titan Eastmed Investments Limited and the country of its incorporation from
U.K. to Cyprus.
3) In April 2021, Alexandria Development Limited changed the country of its incorporation from U.K. to Cyprus.
2) Change in percentage ownership.
Significant Group structure changes
1) On 17 May 2021, the Group's subsidiary in Cyprus, Tithys Holdings Limited, acquired Rea Cement Investments Limited. The Group incorporated Rea
Cement Investments Limited in its financial statements with the full method of consolidation.
189
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
(all amounts in Euro thousands) 2021 2020
restated
A
nalysis of deferred tax liabilities (before set - offs)
Property, plant and equipment 128,342 131,322
Mineral deposits 17,624 17,223
Intangible assets 45,350 38,952
Unrealized foreign exchange differences 4,959 2,596
Receivables and prepayments 1,026 351
Trade and other payables 113 -
Prepaid expenses 1,624 1,468
Other -432 120
198,606 192,032
Analysis of deferred tax assets (before set - offs)
Intangible assets -78 -78
Investments & other non-current receivables -1,450 -1,068
Treasury Shares -1,940 -11,550
Unrealized foreign exchange differences -10,773 -13,442
Inventories -2,675 -3,029
Post-employment and termination benefits -4,460 -4,743
Receivables and prepayments -6,513 -6,155
Tax losses carried forward (note 8) -22,402 -21,782
Interest expense tax carried forward -4,421 -3,769
Deferred income -701 -930
Long-term debt/lease obligations -12,527 -10,675
Provisions and accrued expenses -23,683 -23,509
Trade and other payables -128 -87
Other -2,118 -1,601
-93,869 -102,418
Net deferred tax liability 104,737 89,614
Deferred tax assets (after set - offs) 8,867 12,464
Deferred tax liabilities (after set - offs) 113,604 102,078
Net deferred tax liability 104,737 89,614
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities
and when the deferred income taxes relate to the same fiscal authority.
18. Deferred income taxes (continued)
190
MANAGEMENT REPORT
FINANCIAL REVIEW
(all amounts in Euro thousands)
January 1, 2021 Debit to equity
Debit/(Credit) to
net profit
Debit/(Credit) to
equity through
statement OCI
Exchange
differences December 31, 2021
restated
Deferred tax liabilities (before set - offs)
Property, plant and equipment
131,322 213 -3,061 -263 131 128,342
Mineral deposits
17,223 - -993 - 1,394 17,624
Intangible assets
38,952 - 3,255 - 3,143 45,350
Unrealized foreign exchange differences
2,596 - 2,056 - 307 4,959
Receivables and prepayments
351 - 675 - - 1,026
Trade and other payables
- - 113 - - 113
Prepaid expenses
1,468 - 33 - 123 1,624
Other
120 - -575 - 23 -432
192,032 213 1,503 -263 5,121 198,606
Deferred tax assets (before set - offs)
Intangible assets
-78 - - - - -78
Investments & other non-current receivables -1,068 - -372 - -10 -1,450
Treasury Shares
-11,550 9,610 - - - -1,940
Unrealized foreign exchange differences
-13,442 - 2,461 1,009 -801 -10,773
Inventories
-3,029 - 442 - -88 -2,675
Post-employment and termination benefits -4,743 - -21 372 -68 -4,460
Receivables and prepayments
-6,155 - -286 - -72 -6,513
Tax losses carried forward (note 8)
-21,782 - -547 - -73 -22,402
Interest expense tax carried forward
-3,769 - -652 - - -4,421
Deferred income
-930 - 294 - -65 -701
Long-term debt/lease obligations
-10,675 - -958 - -894 -12,527
Provisions and accrued expenses
-23,509 - 1,258 - -1,432 -23,683
Trade and other payables
-87 - -41 - - -128
Other
-1,601 - -469 - -48 -2,118
-102,418 9,610 1,109 1,381 -3,551 -93,869
Net deferred tax liability 89,614 9,823 2,612 1,118 1,570 104,737
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when the deferred income taxes
relate to the same fiscal authority.
The movement in deferred tax assets and liabilities (prior to offsetting balances within the same tax jurisdiction) during the year is as follows:
18. Deferred income taxes (continued)
191
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
(all amounts in Euro thousands)
January 1, 2020
Credit to equity
Deferred tax
adjustment due
to change in
income tax rates
Debit/(Credit) to
net profit
Debit/(Credit) to
equity through
statement OCI
Exchange
differences
December 31,
2020
restated restated
Deferred tax liabilities (before set - offs)
Property, plant and equipment
150,046 - -1,489 -3,576 - -13,659 131,322
Mineral deposits
20,127 - - -1,292 - -1,612 17,223
Intangible assets
38,292 - - 3,809 - -3,149 38,952
Unrealized foreign exchange differences
5,694 - - -2,851 - -247 2,596
Investments
157 - - -154 - -3 -
Receivables and prepayments
351 - - - - - 351
Trade and other payables
9---9---
Prepaid expenses
1,113 - - 481 - -126 1,468
Other 186 - - -22 - -44 120
215,975 - -1,489 -3,614 - -18,840 192,032
Deferred tax assets (before set - offs)
Intangible assets
-290 - - 208 - 4 -78
Investments & other non-current receivables
-3,215 - - 2,142 - 5 -1,068
Treasury Shares
-6,256 -5,294 - - - - -11,550
Unrealized foreign exchange differences
-9,051 - - -4,240 -1,151 1,000 -13,442
Inventories
-1,578 - - -1,560 - 109 -3,029
Post-employment and termination benefits
-5,436 - - 508 42 143 -4,743
Receivables and prepayments
-7,222 - - 867 - 200 -6,155
Tax losses carried forward (note 8)
-60,086 - - 34,648 - 3,656 -21,782
Interest expense tax carried forward
-3,914 - - 145 - - -3,769
Deferred income
-681 - - -329 - 80 -930
Long-term debt/lease obligations
-12,896 - - 1,253 - 968 -10,675
Provisions and accrued expenses
-18,644 - - -6,442 - 1,577 -23,509
Trade and other payables
-107 - - 19 - 1 -87
Other
-1,733 - - 156 - -24 -1,601
-131,109 -5,294 - 27,375 -1,109 7,719 -102,418
Net deferred tax liability 84,866 -5,294 -1,489 23,761 -1,109 -11,121 89,614
The movement in deferred tax assets and liabilities (prior to offsetting balances within the same tax jurisdiction) during the prior year is as follows:
18. Deferred income taxes (continued)
192
MANAGEMENT REPORT
FINANCIAL REVIEW
(all amounts in Euro thousands) 2021 2020
Inventories
Raw materials-maintenance stores 213,465 179,360
Finished goods 101,299 81,293
Provision for obsolete inventories -9,633 -12,067
305,131 248,586
Analysis of provision for impairment of inventories
Balance at 1 January
12,067 4,538
Charge for the year (note 29) 606 9,197
Unused amounts reversed (note 29) -2,773 -984
Utilized -180 -730
Reclassification from/to PPE -184 135
Exchange differences 97 -89
Balance at 31 December 9,633 12,067
20. Receivables and prepayments
(all amounts in Euro thousands) 2021 2020
Trade receivables 130,025 108,814
Cheques receivables 24,708 25,381
Allowance for doubtful debtors -26,286 -26,231
Total trade receivables 128,447 107,964
Creditors advances 4,478 6,303
V.A.T. and other tax receivables 19,788 11,465
Prepayments 16,774 13,080
Notes receivable 43,204 22,808
Receivables from authorities 13,292 12,329
Other receivables 13,082 13,338
Allowance for doubtful debtors -2,721 -2,040
Total other receivables 107,897 77,283
236,344 185,247
Moreover, the Group hold collaterals amounting to €29,449 thousand (31.12.2020: €30,720 thousand) (note 30).
In 2021, the increase in inventories of raw materials and finished goods mostly affected by the increase in energy and shipping freight
costs.
19. Inventories
The Group applies the IFRS 9 simplified approach for measuring expected credit losses. The approach uses a lifetime expected loss allowance for all
trade and other receivables.
On that basis, an impairment analysis is performed at the end of the year, using provisional rates that are based on days past due for groupings of
various customer segments with similar characteristics. The calculation reflects the probability-weighted outcome, the time value of money and
reasonable and supportable information that is available at the reporting date about past events, current conditions, forecasts of future economic
conditions, in addition with specific information for individual receivables.
Financial assets are written off when there is no reasonable expectation of recovery, such as a debtor failing to engage in a repayment plan with the
Group. Where receivables have been written off, the Group continues to engage in enforcement activity to attempt to recover the receivable due.
Where recoveries are made, these are recognised in the income statement.
Trade receivables are non-interest bearing and are normally settled on 30-170 days.
The Group's subsidiaries have not pledged their inventories as collateral.
Specifically, TALLC entered into an accounts receivable sale agreement with an unrelated SPE in 2014, whereby trade accounts receivable sold by
TALLC to the SPE in exchange for cash and interest-bearing notes receivable.
On 31.12.221, the balance of the notes receivable has been increased compared to the prior year due to the increased sales of trade accounts
receivable by Titan America LLC (TALLC) to an unrelated Special Purpose Entity (SPE).
193
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
20. Receivables and prepayments (continued)
(all amounts in Euro thousands)
Expected credit loss rate
Trade receivables
Impairments
As at 31 December 2021
Current 2% 65,695 1,299
More than 30 days past due 3% 47,632 1,385
More than 60 days past due 6% 7,723 437
More than 120 days past due 69% 33,683 23,165
154,733 26,286
As at 31 December 2020
Current 3% 69,168 1,963
More than 30 days past due 6% 26,663 1,625
More than 60 days past due 9% 8,041 738
More than 120 days past due 72% 30,323 21,905
134,195 26,231
(all amounts in Euro thousands)
Trade receivables
Impairments
As at 31 December 2021
Greece and Western Europe 61,898 3,971
North America 43,850 2,654
South Eastern Europe 15,972 1,723
Eastern Mediterranean 15,919 844
137,639 9,192
As at 31 December 2020
Greece and Western Europe 51,316 4,406
North America 30,223 2,160
South Eastern Europe 16,778 1,320
Eastern Mediterranean 18,620 1,087
116,937 8,973
2021 2020
Balance at 1 January 28,271 27,542
2,412 2,835
-690 -850
-1,141 -755
183 96
-28 -597
Balance at 31 December 29,007 28,271
21. Cash and cash equivalents
(all amounts in Euro thousands)
2021 2020
59 70
79,823 206,368
79,882 206,438
Short-term bank deposits comprise primarily of current accounts and time deposits. The effective interest rates on these short-term bank
deposits are based on floating rates and are negotiated on a case by case basis.
Utilized
Short-term bank deposits
The balances of trade receivables and impairment are as follows:
Cash at bank and in hand
Reclassification from other receivables/payables
Exchange differences
Allowance for doubtful and other debtors analysis
Charge for the year (note 29)
Unused amounts reversed (note 29)
To measure the expected credit losses for trade receivables per region, the Group excludes balances that are past due more than five years,
as these balances do not fairly represent current market conditions. Consequently, the balances presented in the tables below are adjusted
by the amount of €17.1 million on 31.12.2021 and €17.3 million on 31.1.2020 compared with the balances in the tables above.
The individually impaired receivables mainly relate to wholesalers, which are in unexpectedly difficult economic situation. It was assessed
that a portion of the receivables is expected to be recovered.
194
MANAGEMENT REPORT
FINANCIAL REVIEW
22. Share capital and premium
(all amounts are shown in Euro thousands unless
otherwise stated)
Share premium
Number of shares €'000 €'000 Number of shares €'000
Shares issued and fully paid
Balance at 1 January 2020
82,447,868 1,159,348 5,974 82,447,868 1,165,322
Balance at 31 December 2020
82,447,868 1,159,348 5,974 82,447,868 1,165,322
Cancellation of treasury shares
-4,122,393 - - -4,122,393 -
Balance at 31 December 2021 78,325,475 1,159,348 5,974 78,325,475 1,165,322
Number of shares €'000
Balance at 1 January 2020
4,804,140 117,139
Treasury shares purchased
786,278 8,816
Treasury shares sold
-77,916 -1,835
Balance at 31 December 2020
5,512,502 124,120
Cancellation of treasury shares
-4,122,393 -92,820
Treasury shares purchased
230,141 3,230
Treasury shares sold
-123,101 -2,757
Balance at 31 December 2021 1,497,149 31,773
Ordinary shares Total
Treasury shares
The average ordinary shares stock price of Titan Cement International S.A. for the period 1.1.2021-31.12.2021 was €15.44 (1.1.2020-31.12.2020: €12.62).
The closing stock price on 31 December 2021 was €13.26 (31.12.2020: €13.86).
Following the decision of the Extraordinary General Meeting of Shareholders dated 13 May 2019 which authorized the Board of Directors to acquire
and dispose Company’s own shares in accordance with the provisions of article 7:215 ff of the Belgian Companies and Associations Code, in October
2021, the Board decided to implement a share buy-back program of up to a maximum amount of €10 million for a duration of up to 6 months. The
Company kept the market fully informed of the progress of the relevant transactions as provided by the applicable regulations.
In implementation of this program, during the period from October 14, 2021 until December 31, 2021, the Company acquired directly 90,948 own shares
and indirectly through its subsidiary Titan Cement Company S.A. 139,193 shares, representing 0.12% and 0.18% respectively of the share capital of the
Company. The total value of these transactions amounted to €3,229,701. On 31.12.2021 the Company holds 412,173 own shares representing 0.53% of
the Company’s share capital and Titan Cement Company S.A. (Titan SA), a direct subsidiary of the Company, holds 1,084,976 shares of the Company,
representing 1.38% of the Company’s voting rights.
Titan S.A., a direct subsidiary of the Company, sold in 2021 to Titan Group employees, in implementation of existing stock option plans, 123,101 shares
of the Company, representing approximately 0.16% of the share capital of the Company, for a total amount of €1,231,010 (i.e.€10/Company share).
195
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
(all amounts in Euro thousands)
Legal
reserve
Non-
Distributable
reserve
Distributable
reserve
Re- organization
reserve (note 22)
Contingency
reserves
Tax
exempt
reserves
under
special
laws
Revaluation
reserve
Actuarial
differences
reserve
Hedging
reserve from
cash flow
hedges
Currency
translation
differences on
derivative
hedging
position
Foreign
currency
translation
reserve
Total other
reserves
Balance at 1 January 2020 101,034 84,994 200,654 -1,188,374 272,885 26,457 64,200 -2,064 - 41,115 -345,665 -744,764
Change in accounting policy (note 1) - - - - - - - 1,383 - - - 1,383
Restated balance at 1 January
2020 101,034 84,994 200,654 -1,188,374 272,885 26,457 64,200 -681 - 41,115 -345,665 -743,381
Other comprehensive income/(loss) - - - - - - 243 -30 -36 - -118,094 -117,917
Distribution of reserves (note 10) - - -15,414 - - - - - - - - -15,414
Deferred tax on treasury shares
held by subsidiary - - - - - - 5,294 - - - - 5,294
Deferred tax adjustment due to
change in income tax rates on
revaluation reserves (note 18) - - - - - - 1,117 - - - - 1,117
Acquisition of non-controlling
interest 229 - - - - 7 1,815 - - - -1,126 925
Transfer from retained earnings - - -1,027 - - -869 -5,524 - - - - -7,420
Transfer among reserves - 3,876 -3,876 - 1,317 - - - - - -13 1,304
Balance at 31 December 2020 101,263 88,870 180,337 -1,188,374 274,202 25,595 67,145 -711 -36 41,115 -464,898 -875,492
Restated Balance at 1 January 2021 101,263 88,870 180,337 -1,188,374 274,202 25,595 67,145 -711 -36 41,115 -464,898 -875,492
Other comprehensive income - - - - - - 493 863 1,645 - 18,701 21,702
Cancellation of treasury shares - -65,318 - - - - - - - - - -65,318
Distribution of reserves (note 10) - - -30,780 - - - - - - - - -30,780
Deferred tax on treasury shares
held by subsidiary - - - - - - -9,610 - - - - -9,610
Deferred tax adjustment on
revaluation reserves (note 18) - - - - - - -213 - - - - -213
Acquisition of non-controlling
interest 32 - - - - - 301 - - - -319 14
Transfer (to)/from retained
earnings 6,883 - -422 - -212,560 5,869 -9,051 - - - - -209,281
Transfer among reserves - 51 -51 - 6,456 -4,226 50 - - - - 2,280
Balance at 31 December 2021 108,178 23,603 149,084 -1,188,374 68,098 27,238 49,115 152 1,609 41,115 -446,516 -1,166,698
23. Other reserves
196
MANAGEMENT REPORT
FINANCIAL REVIEW
23. Other reserves (continued)
The "Actuarial Differences Reserve" records the re-measurement gains and losses (actuarial gains and losses) arising from the actuarial studies
performed by the Group's subsidiaries for various benefit, pension or other retirement schemes (note 25).
The "Foreign Currency Translation Reserve" is used to record exchange differences arising from the translation of the financial statements of foreign
subsidiaries. Moreover, it includes the currency translation differences reserve on transactions designated as part of net investment in foreign
operations. During the last quarter of 2016, the Group's subsidiary in Egypt, Alexandria Portland Cement Co. S.A.E. (APCC) renewed the € 76.9 million
loan it entered into with its parent company in 2010. According to its accounting policy, the Group recognizes in its consolidated financial statements
the aforementioned intergroup loan as part of the net investment in the Egyptian operation. On 31 December 2021, this reserve has a debit balance of
€26.0 million (2020: €28.4 million).
The "Currency Translation Differences on Derivative Hedging Position Reserve" illustrates the exchange differences arising from the translation into
euro of loans in foreign currency, which have been designated as net investment hedges for certain Group subsidiaries abroad. It also illustrates the
exchange differences arising from the valuation of financial instruments used as cash flow hedges for transactions in foreign currencies.
Certain Group companies are obliged according to the applicable commercial law to retain a percentage of their annual net profits as legal reserve.
This reserve cannot be distributed during the operational life of the Group companies.
The "Contingency Reserves" include, among others, reserves formed by certain Group subsidiaries by applying developmental laws. These reserves
have exhausted their tax liability or have been permanently exempted from taxation, so there is no additional tax charge for the Group and the
Company from their distribution.
The "Revaluation Reserves" include, among others, €48.2 million (2020: €51.5 million) as the fair value of tangible and intangible assets that the Group
had in Egypt through its participation in the joint venture Lafarge-Titan Egyptian Investments Ltd, until it fully acquired the joint venture and €2.0
million (2020: €11.6 million) deferred tax on treasury shares held by Titan Cement Company S.A.
The "Tax Exempt Reserves under Special Laws", according to the tax legislation, are exempt from income tax, provided that they are not distributed
to the shareholders. The distribution of the remaining aforementioned reserves can be carried out after the approval of the shareholders at the
Annual General Meeting and the payment of the applicable tax. Depending on whether they are capitalized or distributed, some of these reserves
have different tax charge. The Group has no intention to distribute the remaining amount of these reserves and consequently, has not calculated the
income tax that would arise from such distribution.
The "Distributable reserve" of €200 million was introduced with the reduction of TCI share capital after the completion of the share exchange
transaction. This reserve may be distributed in the future subject to the approval of the respective authoritative body. On 31 December 2021, the
distributable reserves amounts to €149.1 million.
Under the requirements of the Belgian Law, the "Non-Distributable reserve" represents a reserve equivalent to the value of the treasury shares held
by Titan Cement International S.A. and its subsidiary Titan Cement Company S.A.
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TITAN CEMENT GROUP
24. Share-based payments
2020 plan 2017 scheme 2014 scheme
Balance at 1 January 2020
- 1,247,400 236,951
Granted
616,980 - -
Exercised
- -18,548 -59,693
Non vested
- -128,265 -
Cancelled
-116,460 -41,172 -6,901
Balance at 31 December 2020
500,520 1,059,415 170,357
Granted
407,630 - -
Exercised
- -82,166 -40,935
Non vested
- -244,211 -
Cancelled
-6,420 -17,445 -5,340
Balance at 31 December 2021
901,730 715,593 124,082
Exercise price
2021 2020 2021 2020 2021 2020
Expiration date
2021
-----6,594
2022
----124,082 163,763
2023
249,115 250,260 62,447 108,531 - -
2024
450,865 250,260 90,252 380,950 - -
2025
201,750 - 562,894 569,934 - -
901,730 500,520 715,593 1,059,415 124,082 170,357
Share options and other share-based awards are granted to members of senior management. Movements in the number of share options and awards
outstanding are as follows:
Share options and awards outstanding at the end of the year have the following terms:
2014 scheme
The Beneficiaries shall be entitled to exercise their stock option rights, either in whole or in part, within the first five working days of each month,
paying the relevant amounts until the expiration date of their stock options, i.e. until December of the third year after these stock options have been
vested.
a) By 50% on the average three year Return on Average Capital Employed (ROACE) compared to the target of each year period, as this will be
determined by the Board of Directors before granting the relevant option rights.
b) By 50% on the overall performance of TITAN Cement Company S.A. common share compared to the average overall performance of the shares of
predefined international cement producing companies.
2014 Programme
The vesting period of the stock options that were granted in 2014, 2015 and 2016 was three years. Therefore, the relevant option rights became mature
in December of 2016, 2017 and 2018 respectively, provided that the beneficiaries were still employees of the Group. After the completion of the three-
year vesting period, the final option rights number, which the beneficiaries would be entitled to exercise, should be determined by the Board of
Directors of TITAN Cement Company S.A. within the first four months of 2017, 2018 and 2019 respectively and depends:
On 20 June 2014, the General Meeting of TITAN Cement Company S.A. approved the introduction of a new, three-year (2014-2016) Stock Option
Programme. According to this Programme, the Board of Directors can grant option up to 1,000,000 ordinary shares at a sale price €10.00 per share.
Beneficiaries of the Stock Option Plan were the executive members of the Board of Directors of TITAN Cement Company S.A., the managers and the
employees with the same rank in affiliated companies inside and outside Greece, as well as a limited number of additional employees who stand out on
a continuous basis for their good performance and have a high potential for advancement.
€ 10
2020 plan
€ 0
2017 scheme
€ 10
The fair value of the options granted in 2015 was €4.14 per option, determined using the Binomial Method and the Monte Carlo Simulation valuation
model. The significant inputs used in the aforementioned methodologies were the share price at grant date of €19.55, the employee forfeiture rate 9.2%,
the volatility of the share price estimated at 40.61%, the dividend yield of 0.59% and the yield of the 1 year EURIBOR rate of 0.166%.
The options granted under the 2014 Programme have been accounted for in terms of the requirements of IFRS 2 “Share based payments”. The number
of Share Options that were granted was: 250,190 during 2014, 313,080 during 2015 and 303,150 during 2016.
The fair value of the options granted in 2014 was €7.39 per option, determined using the Binomial Method and the Monte Carlo Simulation valuation
model. The significant inputs used in the aforementioned methodologies were the share price at grant date of €25.32, the employee forfeiture rate
9.2%, the volatility of the share price estimated at 47.2%, the dividend yield of 0.376% and the yield of the 3 year EU Benchmark (Deutsche Bund)
Government bond yield rate of 0.083%.
The fair value of the options granted in 2016 was €5.17 per option, determined using the Binomial Method and the Monte Carlo Simulation valuation
model. The significant inputs used in the aforementioned methodologies were the share price at grant date of €20.38, the employee forfeiture rate
9.2%, the volatility of the share price estimated at 42.80%, the dividend yield of 0.87% and the yield of the 1 year EURIBOR rate of -0.15%.
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24. Share-based payments (continued)
2014 Programme (continued)
2017 Programme
The number of Share Options that were granted during 2017 was 263,680.
The fair value of the options granted in 2017 was €6.6 per option, determined using the Binomial Method and the Monte Carlo Simulation valuation
model. The significant inputs used in the aforementioned methodologies were the share price at grant date of €25.8, the employee forfeiture rate
4.5%, the volatility of the share price estimated at 42.82%, the dividend yield of 0.9% and the yield of the 1 year EURIBOR rate of -0.127%.
On 1 June 2018, 402,370 share options were granted to Group executives under the three-year Stock Option Programme of 2017. The exercise price of
the options is €10.0. The fair value of the options granted in 2018 was €5.99 per option, determined using the Binomial Method and the Monte Carlo
Simulation valuation model. The significant inputs used in the aforementioned methodologies were the share price at grant date of €21.00, the
employee forfeiture rate 2.5%, the volatility of the share price estimated at 42.71%, the dividend yield of 0.86% and the yield of the 1 year EURIBOR
rate of -0.184%.
On June 7 2019, 601,710 share options were granted to Group Executives under the three- years Stock Option Programme of 2017. The exercise price is
€10.00. The fair value of the options granted was €4.13 per option, determined using the Binomial Method and the Monte Carlo Simulation model. The
significant inputs used were the share price at the grant date of € 17.72, the employee forfeiture rate 2.7%, the volatility of the share price estimated at
40.49%, the dividend yield of 0.92% and the yield of the 1 year EURIBOR rate of -0.175%.
On 31 December 2021, the number of the cancelled share options that were granted during 2017, 2018 and 2019 was 8,336, 21,420 and 38,816
respectively. Out of the options that were granted in 2017, the share options that were not vested amounted to 128,265 and out of the options that
were granted in 2018, the share options that were not vested amounted to 244,211. Out of the share options that were granted during 2017, 10,193
vested and cancelled and 54,439 share options were exercised by 45 Group executives, while 62,447 remain unexercised and they can be exercised
until the end of 2023. Out of the share options that were granted during 2018, 46,275 share options were exercised by 37 Group executives while
90,252 remain unexercised and they can be exercised until the end of 2024. Out of the share options that were granted during 2019, 562,894 remain
unexercised and they can be exercised or cancelled until the end of 2025.
The Extraordinary General Meeting of Shareholders of the new Parent Company Titan Cement International S.A. approved on May 13, 2019, subject to
Completion of the share exchange Tender Offer between Titan Cement International SA and TITAN Cement Company S.A., the amendment of the
existing stock option plans, namely to replace the stock options on Titan Cement Company S.A. shares by stock options on shares of Titan Cement
International, without otherwise amending the terms and conditions of the plans. Titan Cement Company still has the obligation to settle the share-
based payment transaction.
The Beneficiaries shall be entitled to exercise their stock option rights, either in whole or in part, within the first five working days of each month,
paying the relevant amounts until the expiration date of their stock options, i.e. until December of the third year after these stock options have been
vested.
The options granted under the 2017 Programme have been accounted for in terms of the requirements of IFRS 2 “Share based payments”.
As a result, two plans (2014 and 2017) are currently under implementation by stock options on shares of Titan Cement International owned by its
subsidiary Titan Cement Company S.A. During 2021, the Beneficiaries were provided with shares of Titan Cement International owned by its subsidiary
Titan Cement Company. The sale price of common treasury share (over-the-counter transaction) equaled to €10.00 per share. The total share price
amounted to €1,231 thousand. The loss caused by this transaction amounted to €1,526 thousand, recognised in equity.
a) by 50% on the average three year Return on Average Capital Employed (ROACE) of the Group against the target for each three-year period and
b) by 50% on the overall performance of TITAN stock compared to the average performance of the shares of the predefined international cement
producing companies.
On 31 December 2021, the number of the cancelled share options that were granted during 2014, 2015 and 2016 was 4,300, 12,060 and 14,370
respectively. Out of the options that were granted in 2014, the share options that were not vested amounted to 125,378. Out of the options that were
granted in 2015, the share options that were not vested amounted to 161,305 and out of the options that were granted in 2016 the share options that
were not vested amounted to 53,968.
Out of the share options that were granted during 2014, 31,625 vested and cancelled. The remaining 88,887 share options were exercised by 83 Group
executives. Out of the share options that were granted during 2015, 38,327 vested and cancelled while 11,086 remain unexercised and they can be
exercised exceptionally until the end of 2022. The remaining 90,302 share options were exercised by 69 Group executives. Out of the share options
that were granted during 2016, 11,849 vested and cancelled while 112,996 remain unexercised. The remaining 109,967 share options were exercised by
51 Group executives.
On 12 May 2017, the General Meeting of TITAN Cement Company S.A. approved the introduction of the current three-year Stock Option Programme.
According to this Programme, the Board of Directors can grant option up to 1,000,000 ordinary shares of the Company at a sale price equal to €10.00
per share. Beneficiaries of the Stock Option Plan are the executive members of the Board of Directors, the managers and the senior employees of the
Company and its affiliated companies inside and outside Greece.
The vesting period of the stock options that were granted in 2017, 2018 and 2019 shall be three years. Therefore, the relevant option rights shall
become mature in December of 2019, 2020 and 2021 respectively, provided that the beneficiaries are still employees of the Group. After the
completion of the three-year vesting period, the final option rights number that the beneficiaries will be entitled to exercise will be determined within
the first four months of 2020, 2021 and 2022 respectively and depend:
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INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
24. Share-based payments (continued)
2020 Plan
25. Retirement and termination benefit obligations
Non-qualified deferred compensation plan
This plan is intended to constitute an unfunded plan of deferred compensation for a selected group of highly compensated employees under the Employee Income
Security Act of 1974 ("ERISA"). For this purpose the Group's U.S. subsidiary created an irrevocable trust to facilitate the payment of deferred compensation to
participants under this plan. Under this plan the participants are eligible to defer from 0% to 20% of eligible compensation for the applicable plan year. On 31 December
2021 and 2020, plan assets totaled €3,307 thousand and €2,572 thousand, respectively, and are classified as other non current assets in the accompanying consolidated
statement of financial position (note 3, 17). There were no costs for the plan for the year ended 31 December 2021 or 2020.
- future salary increases of 1.7% (2020: 1.7%)
,
- average turnover rate of employees with permanent contract up to age 50 is 1 % for voluntary resignation and 2 % for dismissal and for employees above the age 51 is
0 % for voluntary resignation and 1 % for dismissal.
On May 24, 2021, the IFRS Interpretations Committee (IFRIC) published its Agenda Decision, Attributing Benefit to Periods of Service (IAS 19 Employee Benefits) and
concluded that an entity’s obligation increases until the date when future service by the employee will lead to no material amounts of further benefits (note 1). In
accordance with the aforementioned decision, the application of the basic principles of IAS 19 in Greece has been changed and the calculations have been adjusted to
recognize retirement obligations for the last 16 years of service until retirement. Until the issuance of the IFRIC Decision, entities applied IAS 19 distributing the
benefits defined by the respective law 2112/1920, and its amendment 4093/2012.
USA
The Group's U.S. subsidiaries operate defined benefit plans and other post-retirement benefit plans. The method of accounting for the latter, as well as the valuation
assumptions and the frequency of valuations are similar to those used for defined benefit plans.
All of the Group's U.S. subsidiaries' defined benefit pension plans and all but one of its other post-retirement plans have been frozen as to new participants and credited
service. One post-retirement benefit plan exists (for certain active and former employees) whereby eligible retirees receive benefits consisting primarily of assistance
with medical insurance costs between the dates of early retirement and Medicare eligibility.
On 31 December 2021 the plan assets of the Group's subsidiaries in the US have invested approximately 56% (2020: 60%) in equity instruments quoted in US and
international stock markets and 44% (2020: 40%) in fixed investments (US and international bonds). The discount rate that has been adopted for the study of the
pension plans of the Group's subsidiaries in the U.S. was 2.56% (2020: 2.30%).
The Group grants retirement indemnities which exceed the legal requirements. These retirement indemnities are unfunded and the liabilities arising from such
obligations are actuarially valued by an independent firm of actuaries. The last actuarial valuation was undertaken in December 2021.
The principal actuarial assumptions used were as follows:
- discount rate of 0.5% as of 31/12/2019 with time weighted average duration 8.17 years according to the market conditions as of 31/12/2019, discount rate of 0.1% as of
31/12/2020 with time weighted average duration 8.19 years according to the market conditions as of 31/12/2020, and discount rate of 0.6% as of 31/12/2021 with time
weighted average duration 8.19 years according to the market conditions as of 31/12/2021,
Greece
The awards vest at the designated dates, provided that the participants are still working in TCI or in any other employer company of the Group, or are still serving as an
executive Director in the Board of Directors of TCI.
Upon vesting, participants may select to receive their vested awards in TCI shares, or in contributions to a fund, or in cash. In any case, the fair value of the cash
alternative is the same as the share alternative. Thus, the Group accounts for the plan as a cash-settled transaction by recognising a liability for the fair value of the
services it receives from the participants.
The vesting period of the awards is as follows:
a) 50% at the completion of a three-year period and
b) 50% at the completion of a four-year period
On 13 May 2019, the Extraordinary General Meeting of TCI approved a new long-term incentive plan. One year after, on 14 May 2020, the Annual General Meeting of TCI
included it in the Remuneration Policy.
Participants of the plan are the executive members of the Board of Directors of TCI, the executives of TCI, as well as executives, in other companies of Titan
Cement Group. The awards may also be granted selectively to a limited number of employees who stand out on a continuous basis for their outstanding
performance and high potential for development.
Under the plan, participants are granted awards for nil consideration in the form of a conditional grant of TCI shadow shares in April (or later) of each year. The awards
have no dividend or voting rights.
The number of the shadow shares granted to each participant is determined by the award amount and the value of the shadow share. The value of the shadow share is
equal to the average TCI share closing price on Euronext Brussels during the last seven trading days of March of the grant year.
During 2020, the number of the awards granted was 616,980, but 116,460 of them were cancelled. The fair value of the awards was calculated based on the closing price
of the TCI share, €13.86 in Brussels, adjusted for future dividend payments and the forfeiture rate. The calculation of the unforfeited awards resulted in the recognition
of an expense of €1.4 million against a liability, which had a carrying amount of €1.4 million at the end of 2020.
During 2021, another 407,630 awards were granted and 4,130 of them were cancelled. Moreover, an additional number of 2,290 awards that are related to the 2020
granted awards were cancelled. The fair value of the awards was calculated based on the closing price of the TCI share, €13.26 in Brussels, adjusted for future dividend
payments and the forfeiture rate. The calculation of the unforfeited awards resulted in the recognition of an expense of €2.8 million against a liability, which had a
carrying amount of €4.2 million at year end.
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MANAGEMENT REPORT
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25. Retirement and termination benefit obligations (continued)
(all amounts in Euro thousands)
2021 2020
restated
Current service cost
1,805 1,650
Interest cost
441 528
Provision of past service cost for the following year due to the voluntary resignation plans
102 125
Interest income
-255 -342
2,093 1,961
Additional post retirement and termination benefits paid out, not provided for
1,138 933
Post retirement and termination benefits paid out, not provided for due to the voluntary resignation plans 153 406
3,384 3,300
Amounts recognized in profit before interest, taxes, depreciation, amortization and impairment
3,198 3,114
Amounts recognized in finance cost (note 6) 186 186
Amounts recognized in the income statement 3,384 3,300
Actuarial losses recognized in οther comprehensive income -1,240 -30
Amount charged to statement of total comprehensive income 2,144 3,270
Present value of the liability at the end of the period 37,231 35,739
Minus fair value of US plans assets -15,168 -12,915
22,063 22,824
(all amounts in Euro thousands) 2021 2020
restated
Opening balance 22,824 35,268
Change in accounting policy - -10,356
Total expense 3,384 3,300
Re-measurement losses recognized immediately in οther comprehensive income
-1,240 -30
Exchange differences 261 -554
Benefits paid during the year -3,166 -4,804
Ending balance 22,063 22,824
(all amounts in Euro thousands) 2021 2020
Fair value of plan assets at the beginning of the period 12,915 14,634
Expected return 1,209 1,333
Company contributions 501 117
Administrative expenses -168 -178
Benefits paid -363 -1,758
Exchange difference 1,074 -1,233
Fair value of plan assets at the end of the period 15,168 12,915
The amounts relating to defined benefit pension plans and other post retirement and termination benefits (defined benefit plans) recognized in the
statement of comprehensive income in the account other expenses are as follows:
Change in the present value of the defined benefit obligation
Changes in the fair value of US plan assets:
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INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
25. Retirement and termination benefit obligations (continued)
(all amounts in Euro thousands)
Assumptions
1.0% increase 1.0% decrease 1.0% increase 1.0% decrease
Impact on the net defined benefit obligation:
Discount rate -1,691 1,930 -1,970 2,299
Salary 555 -518 603 -558
Health care costs 89 -78 91 -79
Impact on the current service costs:
Discount rate -80 90 -81 91
Salary 110 -99 109 -98
Healthcare costs 2 -2 3 -2
2021 2020
restated
Not later than 1 year 4,451 4,118
Later than 1 year and not later than 5 years 8,865 8,075
Later than 5 years and not later than 10 years 8,671 8,883
Beyond 10 years 17,821 16,418
Total expected payments 39,808 37,494
2021 2020
restated
Due to experience 157 -439
Due to assumptions (financial) -541 1,634
Due to assumptions (demographic) 98 -204
Re-measurement losses on DBO -286 991
Re-measurement gains on plan assets -954 -1,021
Re-measurement losses for the period -1,240 -30
Year ended 31 December 2020
A quantitative sensitivity analysis for significant assumptions is shown below:
Year ended 31 December 2021
The components of actuarial losses that re-calculated and recognized immediately in the other comprehensive income for the years ended December
31, 2021 and 2020 are as follows:
The sensitivity analyses above have been determined based on a method that extrapolates the impact on net defined benefit obligation as a result of
reasonable changes in key assumptions occurring at the end of the reporting period.
The following payments are expected payments to be made in the future years out of the undiscounted defined benefit plan obligation:
restated
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MANAGEMENT REPORT
FINANCIAL REVIEW
(all amounts in Euro thousands)
1 January
2021
Reclassifi-
cations
Additions for
the year
Unused
amounts
reversed
Unwinding
of discount Utilized
Exchange
differences
31 December
2021
Provisions for restorations a 29,689 -1,541 2,305 -1,524 501 -480 1,438 30,388
Insurance reserves b 15,106 - 2,448 -1,342 - - 1,079 17,291
Provisions for other taxes c 3,391 - 2,041 -178 - -258 288 5,284
Litigation provisions
d 416 - 1,858 -324 - -80 12 1,882
Other provisions e 13,638 - 6,340 -3,277 - -3,682 448 13,467
62,240 -1,541 14,992 -6,645 501 -4,500 3,265 68,312
(all amounts in Euro thousands)
1 January
2020
Reclassifi-
cations
Additions for
the year
Unused
amounts
reversed
Unwinding
of discount Utilized
Exchange
differences
31 December
2020
Provisions for restorations a 21,717 - 9,541 -426 612 -733 -1,022 29,689
Insurance reserves b 13,379 - 2,881 - - - -1,154 15,106
Provisions for other taxes c 3,596 - 655 -293 - -372 -195 3,391
Litigation provisions
d 843 - 5 -198 - -221 -13 416
Other provisions e 13,615 - 8,316 -3,608 118 -4,309 -494 13,638
53,150 - 21,398 -4,525 730 -5,635 -2,878 62,240
(all amounts in Euro thousands)
2021 2020
Non-current provisions 56,001 49,550
Current provisions 12,311 12,690
6
68,312 62,240
c. The provision of other taxes represents future obligations for taxes such as stamp duties, sales tax, employee payroll tax etc. It is expected that this
amount will be fully utilized in the next five years.
e. The other provisions are comprised of amounts relating to risks none of which are individually material to the Group. It is expected that the
remaining amounts will be used over the next 1 to 20 years.
a. The provisions for restorations are the present value of the estimated costs to reclaim quarry sites and other similar post-closure obligations. In
2020, the Group's subsidiary in USA, Titan America LLC (TALLC), changed its estimation and increased the provisions of restorations by the amount of
€6.8 million due to increased fixed asset removal obligation associated with the long-term industrial use of one of its cement plant sites. It is expected
that the amount of restoration provisions will be used over the next 1 to 50 years.
d. The litigation provisions have been established with respect to claims made against certain companies in the Group by third parties, mainly against
the subsidiaries in Egypt. These claims concern labor compensations, labor cases for previous years' benefits and dues and claims for shares
revaluation. It is expected that this amount will be utilized mainly in the next twelve months.
26. Provisions
b. The insurance reserves represent the expected costs of claims payments related to risk and workers’ compensation claims, in addition to sponsored
health insurance costs. Previously, they were reported as other liabilities.
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INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
(all amounts in Euro thousands)
2021 2020
Government grants 3,488 3,693
Liability of long-term incentive plan 4,223 1,394
Other non-current liabilities 5,138 4,777
12,849 9,864
Analysis of Government grants:
Non - current 3,488 3,693
Current (note 28) 69 69
3,557 3,762
Opening balance 3,762 3,968
Amortization (note 29) -205 -206
Ending balance 3,557 3,762
(all amounts in Euro thousands)
2021 2020
Deferred Income 1,692 1,991
Non-current contract liabilities 1,692 1,991
(all amounts in Euro thousands)
2021 2020
Trade payables 238,746 175,360
Other payables 14,393 16,281
Consideration for acquisition of non-controlling interest
- 41,453
Accrued expenses 31,832 26,264
Social security 2,965 3,430
Dividends payable 305 364
Government grants (note 27) 69 69
Other taxes 14,301 15,149
Trade and other payables 302,611 278,370
(all amounts in Euro thousands)
2021 2020
Customer down payments/advances 8,681 6,445
Deferred Income 1,317 1,770
Current contract liabilities 9,998 8,215
27. Other non-current liabilities and non-current contract liabilities
Government grants relating to capital expenditures are reflected as long-term liabilities and are amortized on a straight line basis, based on the
estimated useful life of the asset for which the grant was received.
The amount of €5,817 thousand, which was included in the contract liability balance at the beginning of 2021, is recognised in revenue.
Government grants received in respect of expenses are reflected in the income statement when the related expense is incurred, so that the expense
is matched to the income received.
28. Trade payables, other liabilities and current contract liabilities
Other payables include liabilities relating to transportation of cement and raw materials, as well as employee benefit payables.
Trade payables are non-interest bearing and are normally settled in 10-180 days.
Other payables are non-interest bearing and have an average term of one month.
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MANAGEMENT REPORT
FINANCIAL REVIEW
(all amounts in Euro thousands)
2021 2020
restated
Profit after taxes 91,555 1,160
Adjustments for:
Taxes (note 8) 16,811 35,777
Depreciation (note 11) 130,481 133,581
Amortization of intangibles (note 14) 6,205 5,200
Amortization of government grants received (note 27) -205 -206
Impairment of assets (note 11,13) - 47,606
Net profit on disposals of tangible and intangible assets (note 4) -5,747 -1,094
Provision for impairment of debtors charged to income statement (note 20) 1,722 1,985
Cost of inventory obsolescence (note 19) -2,167 8,213
Provision for restoration (note 26a) 1,282 1,937
Provision for litigation (note 26d) 1,534 -193
Other provisions (note 26e) 4,169 4,826
Provision for retirement and termination benefit obligations (note 25)
2,093 1,961
(Increase)/decrease of investment property (note 12) -333 94
Dividend income (note 4.ii) - -100
Finance income (note 6) -1,176 -636
Interest expense and related expenses (note 6) 37,148 49,033
Losses/(gains) on financial instruments (note 6) 22,379 -29,994
(Gains)/losses from foreign exchange differences (note 6) -25,385 46,458
Gains on derivatives -3,220 -
Share stock options (note 7) 886 1,720
Share in gain of associates and joint ventures (note 15) -3,291 -3,200
Changes in working capital:
(Increase)/decrease in inventories -44,848 13,472
Increase in trade and other receivables -52,643 -11,821
(Increase)/decrease in operating long-term receivables and payables -258 136
Increase in trade payables 53,771 3,687
Cash generated from operations 230,763 309,602
Net book amount 2,947 2,016
Net gains on disposals (note 4) 5,747 1,094
Net proceeds from disposals 8,694 3,110
Cash generated from operations 230,763 309,602
Minus payments for intangible assets, property, plant and equipment -126,044 -84,296
Operating free cash flow 104,719 225,306
(all amounts in Euro thousands)
2021 2020
Bank guarantee letters 17,142 16,606
17,142 16,606
29. Cash generated from operations
Operating free cash flow calculation:
30. Contingencies and commitments
Contingent liabilities
In the cash flow statement, proceeds from the disposals of tangible and intangible assets, and investment property are as follows:
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INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
30. Contingencies and Commitments (continued)
4. In May 2013, a new action was filed by three ex-employees of APCC seeking, as in the above case, the nullification of the sale of APCC to Blue Circle
Cement Group. The case has been repeatedly adjourned and, as in the above cases, no judgment will be handed down from the competent
Administrative Court until the Supreme Constitutional Court of Egypt decides on the constitutionality of Law no. 32/ 2014. The view of APCC’s lawyers
is that the action is devoid of any legal and factual ground.
3. In 2012, an ex-employee of Alexandria Portland Cement Company SAE (APCC) brought an action before the Administrative Court of Alexandria
against the President of the Republic of Egypt, the Prime Minister, the Minister of Investments, the Minister of Industry, the Governor of Alexandria,
the Manager of the Mines and Salinas Project in Alexandria and the Manager of the Mines and Quarries Department in Alexandria (but not against
APCC), seeking the nullification of the privatization of APCC through its sale in 1999 to Blue Circle Cement Group, before APCC was subsequently
acquired by Titan Group. The claim was suspended by the Administrative Court of Alexandria initially until 28 May 2016 and subsequently until 15
October 2016, provided that by such date the Supreme Constitutional Court of Egypt would have ruled on the constitutionality of the above Law no.
32/2014. The case was subsequently referred to the Administrative Court of Cairo, Investment Circuit no.1 but no hearing has been scheduled until
now. The view of APCC’s lawyers is that the action is devoid of any legal and factual ground.
2. In June 2013 another action was filed before the Administrative Court of Cairo, seeking, as in the above case, the nullification of BSCC’s privatization.
The Administrative Court of Cairo issued on 25 June 2015 a first instance ruling referring the case to the Investment Circuit no. 7, which subsequently
referred the case to the commissioners’ panel where no hearing date has been scheduled until now. The view of BSCC’s lawyers is that the action is
devoid of any legal or factual ground.
1. In 2011, two former employees of Beni Suef Cement Company SAE (BSCC) filed an action before the Cairo Administrative Court, seeking the
nullification of the privatization of BSCC that took place in 1999, when BSCC was sold to Financière Lafarge after a public auction, before being
subsequently acquired by Titan Group. The Administrative Court of Cairo rejected in 2014 the plaintiffs’ claim in connection with BSCC’s privatization,
however ruled that BSCC was under the obligation to re-instate all employees, the employment of whom had been terminated, including employees
who had left BSCC in the framework of voluntary staff reduction programs. Both the plaintiffs and BSCC have appealed the ruling issued by the first
instance Court before the Supreme Administrative Court, which on 19 January 2015 suspended the case until the Supreme Constitutional Court of
Egypt issues a final ruling on the constitutionality of Law no. 32/2014. The case is still suspended and no further action has been taken until now. The
view of BSCC’s lawyers is that the plaintiffs’ action is devoid of any legal or factual ground.
Litigation matters
A. Privatization cases
The parties concluded the SPA in the context of PAK’s privatization process, through which SharrB acquired a cement plant in Kosovo (Sharr Cement
Plant) by acquiring the local operating company, Ndërmarrja e Re SharrCem SH.P.K. (SharrCem). On March 7, 2022, the arbitral tribunal issued its
award in favor of SharrB confirming that SharrB has discharged its investment obligation under the SPA.
5. Sharr Beteiligungs GmbH (SharrB), a Titan Group entity based in Germany, filed οn February 17, 2020, a claim in arbitration, seeking the arbitral
tribunal’s confirmation that it has satisfied its commitment to implement investments estimated at €35 million within five years, pursuant to Section
5.01(a) of the Share Purchase Agreement entered into between the Privatization Agency of Kosovo (PAK) and SharrB on 9 December 2010 (SPA).
BSCC recorded an increase of intangible assets amounted to EGP 251 million, in order to recognize the license claimed by IDA. In 2019, recognised
additionally as capital expenditure the amount of EGP 166.6 million, that represented interest asked by IDA. The total amount recognised in intangible
assets as license for the construction of a second production line at the company’s plant is EGP 417.6 million and the total amount of interest expenses
,
that it was charged in 2018 income statement, amounted to EGP 98.7 million.
1. In 2007, BSCC obtained the license for the construction of a second production line at the company’s plant in Beni Suef through a bidding process
run by the Egyptian Trading and Industrial Authority (IDA) for a license fee of EGP 134.5 million. IDA subsequently unilaterally raised the license fee to
EGP 251 million. In October 2008 BSCC filed a case before the Administrative Court challenging the price increase and requesting the license price to be
set at EGP 500, or, alternatively, that the price be set at EGP 134.5 million, as had been originally determined through the bidding process. The
Administrative Court dismissed BSCC’s action and BSCC filed an appeal before the High Administrative Court in June 2018. Until today, no appeal
hearing has been scheduled.
BSCC has also lodged an action against IDA requesting the calculation of the payable interest, which is accruing on the EGP 251 million fee that IDA is
claiming, on the basis of the legal interest of 4% per annum and not on the basis of the CBE interest (varying from 9% to 19%) as calculated by IDA.
In June 2018, BSCC and IDA entered into an agreement, pursuant to which BSCC paid to IDA the amount of EGP 251 million for the value of the license
plus the amount of EGP 24.9 million as down payment for interest, calculated on the basis of the CBE interest. Moreover, BSCC has already fully paid in
2018 and 2019 the remaining amount of interest amounting to EGP 240.3 million, under the express agreement that, in case the Egyptian Courts accept
the appeal of BSCC on the value of the license and/or the action of BSCC on the calculation of the payable interest, IDA will pay back to BSCC the
relevant amounts. The view of BSCC’s lawyers is that there is high probability that the High Administrative Court will adopt the price of EGP 134.5
million for the license. Likewise, the view of BSCC’s lawyers is that there is very high probability that BSCC’s action on the calculation of the payable
interest will be accepted by the Court.
B. Other cases
206
MANAGEMENT REPORT
FINANCIAL REVIEW
Contingent tax liability
Contingent assets
(all amounts in Euro thousands)
2021 2020
Bank guarantee letters for securing trade receivables (note 20) 22,350 23,493
Other collaterals against trade receivables (note 20) 7,099 7,227
29,449 30,720
Collaterals against other receivable
s
4,442 920
33,891 31,640
Commitments
(all amounts in Euro thousands)
2021 2020
Property, plant and equipment 713 1,425
(all amounts in Euro thousands)
2021 2020
1,026 651
Directors
2021 2020
Executive members on the Board of Directors
65
Non-executive members on the Board of Directors 9 9
Key management compensation
2021 2020
Short-term employee benefits 5,864 5,690
Share-based payments 929 952
Post-employment benefits 264 246
7,057 6,888
The Group may enter into various transactions with related parties. During 2021 and 2020, the Group did not record material transactions with related
parties.
31. Related party transactions
In conjunction with the aforementioned take-or-pay natural gas agreement, TALLC also entered into capacity supply agreements with a natural gas
marketer, one in 2020 and another in 2021. On 31.12.2021, there are 2,432,000 MMBtus of committed capacity remaining through October 2022. Pricing
under the capacity contract is based on the front-month NYMEX natural gas price settlements, plus a fixed basis component.
In addition to the aforementioned purchase commitments, the Group's subsidiary in USA, Titan America LLC (TALLC), has entered into various
contracts to purchase raw materials and manufacturing supplies. Specifically, TALLC entered into a multi-year agreement to purchase construction
aggregates in Florida at prevailing market prices. Moreover, TALLC has entered into a take-or-pay natural gas agreement with a local utility that
requires TALLC to pay the utility $11,6 million over a maximum period of 6 years beginning November 1, 2020. This agreement requires minimum
cumulative payments equal to $1,935 thousand per contract year until the full contract has been met. As of November 2021, TALLC had met the
minimum cumulative payment requirement. On 31.12.2021, TALLC had paid €2,141 thousand (31.12.2020: €280 thousand) cumulatively under the
agreement.
30. Contingencies and Commitments (continued)
Capital commitments
Purchase commitments
Energy supply contracts (Gas, electricity, etc.)
Capital commitments contracted for at the balance sheet date but not recognized in the financial statements are as follows:
The financial years, referred to in note 37, have not been audited by the tax authorities and therefore the tax obligations of the Company and its
subsidiaries for those years have not yet been finalized.
207
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
(all amounts in Euro thousands)
2021 2020
Current
Bank borrowings 30,997 2,968
Bank borrowings in non euro currency 52,517 33,789
Debentures - 163,133
Interest payable 5,728 5,766
89,242 205,656
Non-current
Bank borrowings 30,863 -
Bank borrowings in non euro currency 14,241 32,911
Debentures 596,357 595,261
641,461 628,172
Total borrowings 730,703 833,828
2021 2020
Between 1 and 2 years 4,517 22,058
Between 2 and 3 years 357,455 2,639
Between 3 and 4 years 1,774 354,592
Between 4 and 5 years 27,967 -
Over 5 years 249,748 248,883
641,461 628,172
2021 2020
Borrowings (€)
2.59% 2.38%
Borrowings (USD)
2.88% 2.86%
Borrowings (LEK)
3.31% 3.38%
Borrowings (EGP)
10.75% 12.51%
Borrowings (TRY)
20.38% 14.32%
(all amounts in Euro thousands)
2021 2020
Floating rate:
- Expiring within one year
167,314 297,859
- Expiring beyond one year 188,876 237,730
The weighted average effective interest rates that affect the Income Statement are as follows:
The Group has the following undrawn borrowing facilities:
During 2021, local borrowing facilities in Greece, Western Europe and Eastern Mediterranean region were paid and cancelled.
32. Borrowings
Finally, in November 2021, TGF amended the Syndicate Revolving Facility Agreement of €200 million maturing in January 2022, by extending the
maturity to January 2026 as well as by increasing the available commitment to €208 million.
Maturity of non-current borrowings:
In June 2021, Titan Global Finance PLC's (TGF) previously held Guaranteed Notes of €163.5 million 3.50% expired and were fully repaid accordingly.
In October 2021, TGF obtained a loan of €30 million by an International bank for a six month period, guaranteed by Titan Cement International SA.
208
MANAGEMENT REPORT
FINANCIAL REVIEW
(all amounts in Euro thousands)
2021 2020
Land
11,771 12,035
Buildings
19,420 18,216
Plant & equipment
17,268 11,073
Motor vehicle
6,356 10,687
Office furniture, fixtures and equipment
322
54,818 52,033
(all amounts in Euro thousands)
2021 2020
Long-term lease liabilities
46,004 38,821
Short-term lease liabilities
16,378 18,194
62,382 57,015
(all amounts in Euro thousands)
2021 2020
Depreciation charge of ROU assets (note 11)
13,964 14,874
Interest expense (included in finance cost)
2,528 2,811
Expense relating to short-term leases
1,247 1,379
Expense relating to low-value leases that are not shown as short-term leases
285 399
Expenses relating to variable lease payments not included in lease liabilities
887 994
(all amounts in Euro thousands)
2021 2020
Within 10 years
4,884 9,320
From 10 to 20 years
19,921 17,278
In more than 20 years
9,528 9,639
34,333 36,237
33. Leases
On 31.12.2021, the undiscounted potential future cash flows of €34,333 thousand (31.12.2020: €36,237 thousand) were not included in the lease liability,
as it is not reasonably certain that the leases will be extended. The timing of these payments would be as follows:
Discount rate
The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, which is generally the case
for the leases in the Group, the lessee's incremental borrowing rate (IBR) is used, being the rate that the individual lessee would have to pay to borrow
the funds necessary to obtain an asset of similar value to the right of use asset in a similar economic environment with similar terms and conditions. In
order to determine IBR, the Group usually uses third party financing that it is received by the individual lessee and makes adjustments to reflect
changes in financing conditions, since third party financing was received. Also, it makes judgements specific to the lease, such as term, country,
currency and security.
The following amounts that related to leases are recognised in the consolidated income statement:
The total cash outflow for the leases in 2021 was €21,256 thousand (2020: €21,550 thousand).
Extension and termination options
The maturity analysis of lease liabilities is disclosed in note 35.
Group as a lessee
The Group has various lease contracts for offices, terminals, machinery, vehicles, computer hardware and other equipment. Rental contracts are
typically made for fixed periods of 1 to 30 years, but may have extension or termination options. Lease terms are negotiated on an individual basis and
contain a wide range of different terms and conditions. There are leases with fixed increases and others where the increase is based on changes in
price indices.
The consolidated statement of financial position includes the following balances related to lease contracts:
Balances of right-of-use assets (note 11)
Balances of lease liabilities
In determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise extension options and
the extension options are only included in the lease term if the lease is reasonably certain to be extended. Extension option which are reasonably
certain to be exercised mainly concern assets which are of strategic importance for the operations of the Group and are not easily replaceable, without
incurring significant relocation costs and disruption of the business such as terminals, ready-mix sites and heavy equipment. The assessment of
reasonably certainty is only revised if a significant event or a significant change in circumstances occurs, which affects this assessment, and is within
the control of the lessee.
209
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
(all amounts in Euro thousands)
Long-term borrowings Short-term borrowings
Lease liabilities
Derivatives* and
interim settlements
Total
Year ended 31 December 2020
Opening balance 776,694 90,140 63,156 -3,143 926,847
Cash flows 140,938 -216,389 -15,967 30,021 -61,397
Acquisition of leases - - 13,979 - 13,979
Changes in fair value - - - -29,994 -29,994
Transfer among financial liabilities -286,421 286,421 - - -
Charged in the finance expenses 1,809 48,487 - - 50,296
Cash flow hedge - - - 48 48
Currency translation differences on transactions designated as part of
net investment in foreign operation
1,200 3,858 - - 5,058
Exchange differences -6,048 -6,861 -4,153 534 -16,528
Ending balance 628,172 205,656 57,015 -2,534 888,309
Year ended 31 December 2021
Opening balance 628,172 205,656 57,015 -2,534 888,309
Cash flows from financing activities 12,653 -152,177 -16,309 -19,441 -175,274
Acquisition of leases - - 17,973 - 17,973
Changes in fair value - - - 22,379 22,379
Transfer among financial liabilities -322 322 - - -
Charged in the finance expenses 1,758 35,841 - - 37,599
Cash flow hedge - - - -1,370 -1,370
Currency translation differences on transactions designated as part of
net investment in foreign operation
-4,557 -1,150 - - -5,707
Exchange differences 3,757 750 3,703 -23 8,187
Ending balance 641,461 89,242 62,382 -989 792,096
* Derivatives of financing activities
34. Changes in liabilities arising from financing activities
210
MANAGEMENT REPORT
FINANCIAL REVIEW
35. Financial risk management objectives and policies
(all amounts in Euro thousands)
31/12/2021 31/12/2020
Non-current assets
Interest rate swap - cash flow hedges 2,488 -
Cross currency swaps - trading derivatives - 2,291
2,488 2,291
Current assets
Forward freight agreements - trading derivatives 1,715 -
Forwards - trading derivatives - 16,462
1,715 16,462
Non-current liabilities
Cross currency swaps - trading derivatives 6,185 -
6,185 -
Current liabilities
Natural gas forwards - cash flow hedges 1,084 47
Energy swap - trading derivatives 27 -
Forwards - trading derivatives 3,290 1,224
Cross currency swaps - trading derivatives 4,341 3,842
8,742 5,113
(all amounts in Euro thousands)
Fair value of
derivatives
Interim settlement of
derivatives
Net balance
Balance at 31 December 2021
Forwards - expired in 2022 -3,290 3,754 464
Energy swap - expired in 2022 -27 - -27
Natural gas forwards - expired in 2022 -1,084 - -1,084
Forward freight agreements - expired in 2022 1,715 794 2,509
Interest rate swap - expired in 2023 2,488 -1,070 1,418
Cross currency swaps - expired in 2024 -10,526 10,716 190
-10,724 14,194 3,470
Balance at 31 December 2020
Forwards - expired in 2021 15,238 -11,977 3,261
Natural gas forwards - expired in 2021 -47 - -47
Cross currency swaps - expired in 2024 -1,551 871 -680
13,640 -11,106 2,534
Financial Risk Factors
The next table shows the gross amounts of the aforementioned derivative financial instruments in relation with their interim settlement, that is
received or paid, as they are presenting in the statements of financial position as at 31.12.2021 and 31.12.2020, in order to summarize the total net
position of the Group.
Net position - Asset /(Liability)
The Group’s senior management is supported by the Group finance, the treasury and the risk committee that advise on risks and the appropriate risk
governance framework for the Group. The risk committee provides assurance to the Group’s senior management that the Group’s financial risk
activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the
Group’s policies and risk objectives. All derivative activities for risk management purposes are carried out by specialist teams and treasury that have
the appropriate skills, experience and supervision. It is the Group’s policy that no trading in derivatives for speculative purposes may be undertaken.
The Board of Directors has overall responsibility for determining the nature and extent of the principal risks that the Group is willing to assume in
achieving its strategic objectives.
The Group has the following derivative financial instruments in the following line items in the statement of financial position:
The Group, by nature of its business and geographical positioning, is exposed to market, credit and liquidity risk. The Group’s senior management
oversees the management of these risks.
Where all relevant criteria are met, hedge accounting is applied to remove the accounting mismatch between the hedging instrument and the hedged
item. However, where derivatives do not meet the hedge accounting criteria, or the Group chooses not to designate a hedging relationship between a
derivative and a hedged item, they are classified as trading derivatives for accounting purposes and are accounted for at fair value through profit or
loss.
211
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
2021 2020
USD 302,800 378,800
TRY 5,190 9,218
LEK 49,923 66,680
In 2021, the aggregate net foreign exchange losses recognised in the consolidated income statement amounted to €73 thousand (2020: €13,216
thousand) and they are analysed further into net exchange gains of €25.4 million (2020: losses of €46.5 million) and fair value losses on derivatives
of €25.5 million (2020: gains of €33.2 million) (note 6).
The Group operates internationally and is exposed to foreign exchange risk (FX). Foreign exchange risk arises from future commercial transactions,
recognised assets and liabilities, mainly borrowings, denominated in a currency that is not the functional currency of the relevant Group entity and
international investments.
Also, the Group recognised exchange gains on translation of foreign operations of €6.6 million in the consolidated statement of comprehensive
income, mainly due to euro depreciation against US dollars (gain of €37.2 million), Egyptian pound (gain of €10.1 million) and Albanian LEK (gain of
€1.7 million), in addition with euro appreciation against Turkish lira (loss of €43.6 million). The comparative exchange losses of 2020 amounted to
€121 million were mainly due to euro strengthening against US dollar (€41.4 million), Turkish lira (€40.2 million), Brazilian real (€29.4 million) and
Egyptian pound (€8.9 million).
Currency risks are managed using natural hedges, FX derivatives/swaps and FX forwards. Borrowings denominated in the same currency as the
assets that are being financed and these create a natural hedge for investments in foreign subsidiaries exposed to FX conversion risk.
However, part of the financing of Group activities in the USA, Albania and Turkey is in different currencies (i.e. Euro) than their functional ones.
Their refinancing in local currencies, along with FX hedging transactions, are examined at regular intervals. The Group's borrowing exposure to
foreign currency risk at the end of the reporting period, expressed in Euro thousands, was as follows:
Specifically, in August 2018, Titan America LLC (TALLC) entered into cross currency interest rate swap agreements (CCSs) that expire in November
2024. The derivatives hedge the interest payments and the foreign currency exposure created by the €150 million 7-year, fixed rate loan that
TALLC borrowed from TGF in December 2017.
The total borrowing exposure of €302.8 million in USA is hedged with derivatives that are classified as trading.
35. Financial risk management objectives and policies (continued)
a) Market risk
Market risk comprises three main types of risk: currency risk, price risk, such as commodity risk and interest rate risk.
Moreover, TALLC entered into various short-term forward contracts during the year 2021, in order to hedge foreign currency risk arising from
financial liabilities in Euro. Particularly, TALLC has rollovered the hedges of EUR/USD forward contracts of €152.8 million loan agreements (2020:
€228.8 million) with maturities in January and in April of 2022.
Currency risk
212
MANAGEMENT REPORT
FINANCIAL REVIEW
(all amounts in Euro thousands)
Foreign Currency
Increase/ Decrease of
Foreign Currency vs. €
Effect on Profit Before
Tax Effect on equity
5% 3,694 25,400
-5% -3,342 -22,981
5% 1,024 1,424
-5% -926 -1,288
5% -562 13,824
-5% 508 -12,507
5% 152 434
-5% -137 -393
5% -399 2,464
-5% 361 -2,230
5% 522 4,080
-5% -472 -3,692
5% 139 6,078
-5% -126 -5,499
5% 3,803 24,179
-5% -3,441 -21,876
5% 964 1,373
-5% -872 -1,242
5% -2,141 12,446
-5% 1,937 -11,260
5% 195 287
-5% -176 -260
5% -352 4,492
-5% 318 -4,064
5% 449 3,557
-5% -407 -3,218
5% 156 5,882
-5% -141 -5,321
Again, TALLC designated a cash flow hedge relationship between the highly probable forecast monthly purchases of natural gas during 2022 and the swap
contracts. Due to coincidence of economic terms, no ineffectiveness is anticipated in this hedge relationship and none was recognised in the consolidated
income statement during 2021. On 31.12.2021, TALLC, and consequently the Group, recognised a total fair value loss of €1,096 thousand in consolidated other
comprehensive income and in equity as a “hedging reserve from cash flow hedges”, with no amount related to this hedge relationship reclassified to the
consolidated income statement in 2021.
Moreover, Zlatna Panega Cement AD entered into a energy swap agreement in December 2021 in order to fix a portion of (API2) coal cost for the month of
November 2022. On 31.12.2021, the loss of the derivative, that was classified as trading, amounted to €27 thousand and it was recorded in the "cost of sales"
account of the consolidated income statement.
Finally, Arresa Marine Co entered into various forwards freight agreements (FFAs) during 2021 and various expirations dates in 2021 and 2022 in order to
partially hedge price fluctuations of freight cost. The FFAs were classified as trading derivatives and their total gain during 2021 of €3.2 million was recognised
in the "cost of sales" of the consolidated income statement.
Price risk
The Group is exposed to the price volatility of electricity, fuel costs, freight rates or other transportation costs, and the cost of raw materials that constitute
the most important elements of the Group’s cost base. During 2021, the Group entered into the following derivatives in order to hedge its exposure price
changes of natural gas, coal and freights.
In December 2020, Titan America LLC (TALLC) entered into a natural gas swap transaction in order to fix a portion of the monthly NYMEX component of its
natural gas costs during 2021. The total notional amount of the swap contract was 1,800,000 MMBtus and its termination date was on 31.12.2021. TALLC
designated a cash flow hedge relationship between the highly probable forecast monthly purchases of natural gas during 2021 and the swap contract. During
2021, TALLC reclassified the net gain of €1,723 thousand associated with the monthly settlements from cash flow hedge reserve to cost of sales, while it
recognised no ineffectiveness in the consolidated income statement.
Additionally, in 2021, TALLC entered into a series of natural gas swap transactions in order to fix a portion of the monthly NYMEX component of its natural gas
costs during 2022. The total notional amount of the swap contracts was 2,350,000 MMBtus and the final termination date is 31.12.2022.
Year ended 31 December 2020
USD
RSD
EGP
GBP
TRY
ALL
BRL
GBP
TRY
ALL
BRL
35. Financial risk management objectives and policies (continued)
The following table demonstrates the sensitivity of the Group’s profit before tax and the Group’s equity to reasonable changes in the USΑ Dollar, Serbian
Dinar, Egyptian Pound, British Pound, Turkish Lira, Albanian Lek and Brazilian Real floating exchange rates, with all other variables held constant.
The calculation of "Effect on Profit before tax" is based on year average FX rates and the calculation of "Effect on Equity" is based on year end FX rate changes.
Sensitivity analysis in foreign exchange rate changes
Year ended 31 December 2021
USD
RSD
EGP
213
INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
Interest rate
variation
Effect on profit before
tax
(+/-) (-/+)
EUR 1.0% 283
USD 1.0% 337
EGP 1.0% -
ALL 1.0% 248
TRY 1.0% 54
EUR 1.0% 14
USD 1.0% -
EGP 1.0% 374
ALL 1.0% 209
TRY 1.0% 14
Note: Table above excludes the positive impact of interest received from deposits.
The impact of interest rate volatility is limited in the income statement and cash flow from operating activities of the Group, as shown in
the sensitivity analysis table below:
Sensitivity analysis of Group's borrowings due to interest rate changes
(all amounts in Euro thousands)
Year ended 31 December 2021
Year ended 31 December 2020
35. Financial risk management objectives and policies (continued)
Due to coincidence of economic terms, no ineffectiveness is anticipated in the aforementioned hedge relationship. The only potential
sources of inefficiency that could result are due to changes in the credit risk of the counterparties, or, in case, the hedged forecast
transaction does not (or is no longer expected to) occur in the amounts, tenor or at the date anticipated. Currently such changes are not
expected.
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market
interest rates. The Group’s exposure to the risk of changes in market interest rates relates primarily to the Group’s long-term debt
obligations with floating interest rates.
The Group manages its interest rate risk by having a balanced portfolio of fixed and variable rate loans and borrowings. The ratio of fixed to
floating rates of the Group’s net borrowings is determined by market conditions, Group strategy and financing requirements. Occasionally
interest rate derivatives may be used to mitigate the relevant risk and balance the mix of fixed and floating rates of the Group’s
borrowings.
Interest rate risk
On 31 December 2021, the Group’s ratio of fixed to floating interest rates, taking into account outstanding cross currency swaps and
interest rate swaps, stood at 88%/12% (31 December 2020: 93%/7%).
Interest rate trends and the duration of the Group’s financing needs are monitored on a forward looking basis. Consequently, decisions
about the duration and the mix between fixed and floating rate debt are taken on an ad-hoc basis.
On 31.12.2021, the carrying amount of the derivative amounted to €2.5 million and it was presented in non-current assets. Moreover, TGF,
and therefore the Group, recognised a fair value gain of €2.5 million in other comprehensive income statement during 2021, while it had no
ineffectiveness to recognise in the income statement.
In June 2021, Titan Global Finance (TGF) entered into a forward starting interest rate swap (IRS) agreement in order to partially hedge the
risk of the increased future mid swap rate from a highly probable future debt issuance. At the inception of the agreement, TGF designated
a cash flow hedge relationship between the IRS and the highly probable future debt issuance by formal documentation.
The forward starting fixed-for-floating EURIBOR-based 5-year interest rate swap with a notional amount of EUR 250m and forward period
up to October 2023 is designated as the hedging instrument for a 100% hedge of the future interest payments arising from the highly
probable forecasted debt issuance in 2023.
214
MANAGEMENT REPORT
FINANCIAL REVIEW
(all amounts in Euro thousands)
< 1 month
1 to 6 months 6 to 12 months
1 to 5 years >5years Total
Borrowings 10,130 54,373 40,988 443,470 256,875 805,836
Lease liabilities (note 33)
1,245 7,687 6,754 34,069 22,078 71,833
Derivative financial instruments 1,398 1,893 5,451 6,185 - 14,927
Payables from interim settlement of derivatives
- - - 1,070 - 1,070
Other non-current liabilities - - - 5,138 - 5,138
Trade and other payables 177,289 91,258 16,729 - - 285,276
190,062 155,211 69,922 489,932 278,953 1,184,080
Borrowings 5,104 202,260 13,327 446,860 256,875 924,426
Lease liabilities (note 33)
2,079 6,760 9,663 29,722 17,551 65,774
Derivative financial instruments 1,224 - 3,889 - - 5,113
Payables from interim settlement of derivatives
12,957 - - 2,291 - 15,248
Other non-current liabilities - - - 4,777 - 4,777
Trade and other payables 127,241 128,291 4,190 - - 259,722
148,605 337,311 31,069 483,650 274,426 1,275,060
2021 2020
restated
641,461 628,172
46,004 38,821
89,242 205,656
16,378 18,194
793,085 890,843
79,882 206,438
713,203 684,405
275,209 285,595
1,341,755 1,400,840
1,336,886 1,275,356
c) Liquidity risk
d) Capital management
Year ended 31 December 2021
Year ended 31 December 2020
The primary objective of the Group’s capital management is to ensure that it maintains healthy capital ratios in order to support its operations and
maximize shareholder value.
The Group includes within net debt, interest bearing loans, borrowings and lease liabilities, less cash and cash equivalents.
The Group manages its capital structure conservatively with the leverage ratio, as this is shown from the relationship between total liabilities and
total equity as well as net debt and earnings before interest, taxes, depreciation, amortization and impairment (EBITDA). Titan's policy is to maintain
leverage ratios in line with an investment grade profile.
35. Financial risk management objectives and policies (continued)
Total liabilities
Total equity
(all amounts in Euro thousands)
Long-term borrowings (note 32)
Long-term lease liabilities (note 33)
Short-term borrowings (note 32)
Short-term lease liabilities (note 33)
Less: cash and cash equivalents (note 21)
Net Debt
Earnings before interest, taxes, depreciation, amortization and
impairment (EBITDA)
The Group, in addition to its operating cash flows, maintains sufficient cash and other liquid assets, as well as extensive committed credit lines with
several international banks to ensure the fulfilment of its financial obligations. Group Treasury controls Group funding as well as the management of
liquid assets.
The table below summarizes the maturity profile of financial and lease liabilities at 31 December 2021 & 2020 based on contractual undiscounted
payments.
Debt
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36. Financial instruments and fair value measurement
(all amounts in Euro thousands)
2021 2020 2021 2020
Financial assets
At amortised cost
Other non-current financial assets 9,249 6,275 9,249 6,275
Trade receivables 128,447 107,964 128,447 107,964
Cash and cash equivalents 79,882 206,438 79,882 206,438
Other current financial assets 52,860 36,831 52,860 36,831
Fair value through other comprehensive income
Derivative financial instruments - non current
2,488 - 2,488 -
Fair value through profit and loss
Derivative financial instruments - non current - 2,291 - 2,291
Receivables from interim settlement of derivatives - non current
6,185 - 6,185 -
Other non-current financial assets 230 181 230 181
Derivative financial instruments - current 1,715 16,462 1,715 16,462
Receivables from interim settlement of derivatives - current
9,079 4,142 9,079 4,142
Other current financial assets 30 30 30 30
Financial liabilities
At amortised cost
Long term borrowings 641,461 628,172 659,678 645,374
Other non-current financial liabilities 17 16 17 16
Short term borrowings 89,242 205,656 89,242 208,137
Other current financial liabilities 281,727 256,486 281,727 256,486
Fair value through other comprehensive income
Derivative financial instruments - current
1,084 47 1,084 47
Fair value through profit and loss
Derivative financial instruments - non current
6,185 - 6,185 -
Payables from interim settlement of derivatives - non current
1,070 2,291 1,070 2,291
Derivative financial instruments - current
7,658 5,066 7,658 5,066
Payables from interim settlement of derivatives - current
- 12,957 - 12,957
Fair value hierarchy
The Group uses the following hierarchy for determining and disclosing the fair value of the assets and liabilities by valuation method:
Level 1: based on quoted (unadjusted) prices in active markets for identical assets or liabilities.
Level 2: based on valuation techniques whereby all inputs having a significant effect on the fair value are observable, either directly or indirectly and
includes quoted prices for identical or similar assets or liabilities in markets that are not so much actively traded.
Level 3: based on valuation techniques whereby all inputs having a significant effect on the fair value are not observable market data.
Set out below is a comparison by category of carrying amounts and fair values of the Group’s financial instruments.
Carrying amount Fair value
Note: Derivative financial instruments consist of fx forwards, cross currency interest rate swaps (CCS), interest rate swaps (IRS), natural gas forwards, forward freight agreements (FFAs), energy
swaps and interim settlements for derivatives that consist of cash, which covers fluctuations in the market value of the aforementioned derivatives.
The management assessed that the cash and cash equivalents, trade receivables, trade payables, bank overdrafts and other current liabilities
approximate their carrying amounts largely due to the short-term maturities of these instruments.
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(all amounts in Euro thousands)
2021 2020
A
ssets
Investment property 10,980 11,720 Level 3
Other financial assets at fair value through profit and loss
260 211 Level 3
Derivative financial instruments 4,203 18,753 Level 2
Receivables from interim settlement of derivatives 15,264 4,142 Level 2
Liabilities
Long-term borrowings 614,391 612,463 Level 2
Long-term borrowings 45,287 32,911 Level 3
Short-term borrowings - 170,196 Level 2
Short-term borrowings 89,242 37,941 Level 3
Derivative financial instruments 14,927 5,113 Level 2
Payables from interim settlement of derivatives 1,070 15,248 Level 2
The following table provides the fair value measurement hierarchy of the Group's assets and liabilities.
36. Financial instruments and fair value measurement (continued)
For the majority of the borrowings in level 3, the fair values are not materially different from their carrying amounts, since the interest
payable on those borrowings is either close to current market rates, or the borrowings are of a short-term nature. The fair values of
non-current borrowings in level 3 are based on discounted cash flows using a borrowing rate that is prevailed in current market
condition.
Level 2 derivative financial instruments comprise fx forwards, cross currency interest rate swaps, interest rate swaps, natural gas
forwards, forward freight agreement and energy swaps. Τhe Group use a variety of methods and make assumptions that are based on
market conditions existing at each reporting date. The aforementioned contracts have been fair valued using: a) forward exchange
rates that are quoted in the active market, b) forward interest rates extracted from observable yield curves, c) US Natural Gas Henry
Hub futures prices that are quoted in the active market, d) Baltic Supramax 10TC 58kt Forward Freight prices that are quoted in the
active market and e) Coal API2 cif ARA (Argus /McCloskey) future prices that are quoted in the active market.
Level 3 other financial assets at fair value through profit and loss refer mainly to investments in foreign property funds in which the
Group owns an insignificant percentage. Their valuation is made based on their financial statements, which present the assets at fair
value.
Fair value
Fair value hierarchy
There were no transfers between level 1 and 2 fair value measurements during the period and no transfers into or out of level 3 fair
value measurements during 2021.
The fair value of level 3 investment property is estimated by the Group by external, independent, certified valuators. The fair value
measurement of the investment property has been mainly conducted in accordance with the comparative method, or the current
market values of similar properties. The main factors that were taken into consideration, are the property location, the surface area,
the local urban planning, the bordering road networks, the regional infrastructure, the property maintenance status and
merchantability, the technical construction standards in the case of buildings and the impact of environmental issues if any.
The fair value of the financial assets and liabilities is the amount at which the instrument could be exchanged in a current transaction
between willing parties, other than a forced liquidation or sale. The following methods and assumptions were used to estimate the fair
values:
For long and short term borrowings in level 2, the evaluation of their fair value is based on parameters such as interest rates, specific
country risk factors, or price quotations at the reporting date. Specifically, they are used quoted market prices, or dealer quotes for the
specific or similar instruments.
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37. Fiscal years unaudited by tax authorities
(1)
Τitan Cement Company S.A
2016-2021 Stari Silo Company DOO 2008-2021
(1)
Albacem S.A.
2016-2021 Cementara Kosjeric AD 2016-2021
(1)
Interbeton Construction Materials S.A. 2016-2021
TCK Montenegro DOO
2007-2021
(1)
Intertitan Trading International S.A. 2016-2021
Double W & Co OOD
2018-2021
(1)
Vahou Quarries S.A.
2016-2021
Granitoid AD
2007-2021
(1)
Gournon Quarries S.A.
2016-2021
Gravel & Sand PIT AD
2005-2021
(1)
Quarries of Tagaradon Community S.A. 2016-2021
Zlatna Panega Beton EOOD
2008-2016
(1)
Aitolika Quarries S.A.
2016-2021
Zlatna Panega Cement AD
2010-2021
(1)
Sigma Beton S.A.
2016-2021
Titan Investment EAD 2017-2019
(1)
Titan Atlantic Cement Industrial and Commercial S.A.
2016-2021 Cement Plus LTD 2014-2021
(1)
Titan Cement International Trading S.A. 2016-2021
Rudmak DOOEL
2006-2021
Titan Cement International S.A. 2019-2021 Esha Material LLC
2016-2021
Aemos Cement Ltd
2012-2018
Esha Material DOOEL
2016-2021
Alvacim Ltd
2013-2021
ID Kompani DOOEL 2015-2021
Iapetos Ltd
2014-2021
Opalit DOOEL 2019-2021
Themis Holdings Ltd
2019-2021
Usje Cementarnica AD
2020-2021
Feronia Holding Ltd
2019-2021
Titan Cement Netherlands BV
2010-2021
Vesa DOOL
2006-2021
Alba Cemento Italia, SHPK
2017-2021
Trojan Cem EOOD 2010-2021
Antea Cement SHA
2020-2021
(2)
Titan Global Finance PLC 2020-2021
Sharr Beteiligungs GmbH
2014-2021
Salentijn Properties1 B.V.
2007-2021
Kosovo Construction Materials L.L.C.
2010-2021
Titan Cement Cyprus Limited
2017-2021
Sharrcem SH.P.K.
2017-2021
KOCEM Limited 2019-2021
Alexandria Development Co.Ltd
2019-2021
Fintitan SRL
2015-2021 Alexandria Portland Cement Co. S.A.E 2019-2021
Cementi Crotone S.R.L. 2015-2021
Beni Suef Cement Co.S.A.E.
2011-2021
Cementi ANTEA SRL 2017-2021
East Cement Trade Ltd
2019-2021
Colombus Properties B.V. 2010-2021 Titan Beton & Aggregate Egypt LLC 2015-2021
Brazcem Participacoes S.A. 2016-2021 Titan Egyptian Inv. Ltd
2019-2021
Adocim Cimento Beton Sanayi ve Ticaret A.S. 2021 Green Alternative Energy Assets EAD 2012-2021
Adocim Marmara Cimento Beton Sanayi ve Ticaret A.S. 2021
GAEA Zelena Alternative Enerjia DOOEL 2013-2021
Aeas Netherlands B.V. 2010-2020
GAEA Enerjia Alternative e Gjelber Sh.p.k. 2017-2021
Titan Cement U.K. Ltd
2015-2021
GAEA -Green Alternative Energy Assets 2016-2021
(3)
Τitan Αmerica LLC
2018-2021
(4)
Arresa Marine Co
-
Separation Technologies Canada Ltd
2016-2021
Tithys Holdings Limited 2020-2021
MILLCO-PCM DOOEL
2016-2021
Rea Cement Investments Limited 2021
38. COVID-19 implications
At the same time, the Group continuously re-assessed the economic consequences of the pandemic and re-examined the estimations and/or
assumptions made in various accounting analyses to include the uncertainty caused by the COVID-19 pandemic.
Specifically, the Group reviewed the accounting estimates and management judgements used in the impairment test of non-financial assets, the
measurement of net realizable value of inventories, the test of financial assets’ collectability and the calculation of deferred tax assets’
recoverability. It concluded that none of the above accounting analyses was impacted by the economic implications of the pandemic.
Finally, governmental measures in the USA allowed Titan America LLC to accelerate the refund of outstanding alternative minimum tax credits,
which was actually received during the first semester of 2021. In addition, governmental measures in the USA allowed Titan America LLC to defer
certain payroll taxes of €6.4 million in 2020 and repay the deferred funds equally in December 2021 and December 2022. The December 2021
installment was repaid and only the December 2022 installment of €3.2 million remains outstanding.
The Group responded to these challenges through several measures, including increasing hygiene and sanitization standards, promoting social
distancing, installing plexiglass panels, making mask use mandatory, offering PCR and rapid testing, and reducing or canceling travel and large
meetings and events. In addition, medical and psychological support were provided by experts or through health care programs.
(1) For the fiscal years 2016-2020 Certified Auditors Accountants tax audited the above companies and issued tax certificates without qualifications, according to the article 65A, par. 1 of L.
4174/2013.
(2) As per UK tax legislation, HMRC could address any enquiry only for the years 2020 – 2021 which remain open to enquiry without the need for a discovery assessment.
(3) Companies operating in the U.S.A. are incorporated in the Titan America LLC subgroup (note 16).
(4) Under special tax status.
The 2021 was marked by the continuous effects of the Covid-19 pandemic, the emergence of new variants and the associated measures
implemented globally.
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39. Events after the reporting period
In March 2022, the Board decided to implement a new share buy-back programme. The new programme will begin on or around April 6, 2022,
following the end of the current running programme. The new share buy-back programme will be up to €10 million and will have a duration of up to
six months. Titan Cement International S.A. will keep the market fully informed of the progress of the relevant transactions in line with applicable
regulations.
Finally, the current military conflict after the Russian invasion in the Ukraine creates geopolitical uncertainties with macroeconomic implications the
extent of which cannot yet be assessed. The Group has no exposure to Ukraine, Russia or affected regions. Nevertheless the effect on the Group’s
businesses from developments in the energy sector and the broader macro implications are anticipated to impact market trends and further increase
inflation risks. Especially in Europe, the economies are entering a difficult phase, with increased risks of rising inflation and a slowdown of economic
growth. There is a negative impact already on the energy sector, the severity of which, as well as the duration, cannot yet be assessed.
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Parent company’s Separate
summarized financial statements
(all amounts in Euro thousands)
2021 2020
Operating income 3,568 4,296
Operating charges -10,121 -9,457
Operating loss -6,553 -5,161
Financial result 356,887 1,799
Profit/(loss) for the period before taxes 350,335 -3,362
Income taxes -1 -1
Profit/(loss) for the period 350,334 -3,363
Year ended 31 December
Income Statement
This is an abbreviated version of the parent company's Financial Statements. A full version of the accounts (included the auditors report), that will be filled with the BNB/NBB, is available on the
Company's website www.titan-cement.com and can be obtained free of charge.
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(all amounts in Euro thousands)
December 31, 2021 December 31, 2020
Assets
Fixed assets
Formation expenses 4,402 6,062
Intangible assets 47 41
Tangible assets 171 225
Financial fixed assets
Participating interests 1,679,788 1,443,069
Other financial fixed assets 23 27
Total financial fixed assets 1,679,811 1,443,096
Total fixed assets 1,684,431 1,449,424
Current assets
Inventory 20,061 -
Amounts receivable within one year 1,456 4,614
Treasury shares 5,465 3,585
Cash at bank and in hand 139 267
Deferred charges and accrued income 145 119
Total current assets 27,266 8,585
Total assets 1,711,697 1,458,009
Equity and liabilities
Equity
Capital 1,159,348 1,159,348
Share premium 15,321 15,320
Reserves 162,261 135,648
Retained (losses)/earnings 246,683 -11,720
Total equity 1,583,613 1,298,595
Provisions and deferred taxes 578 329
Amounts payable
Amounts payable after more than one year
Financial debt --
Other amounts payable 63,401 100,709
Total amounts payable after more than one year 63,401 100,709
Amounts payable within one year
Financial debt 21,717 19,780
Trade debts 2,408 3,505
Taxes, remunerations and social security 927 1,148
Other amounts payable 38,956 33,870
Total amounts payable within one year 64,008 58,303
Accruals and deferred income 97 72
Total amount payables 127,506 159,084
Total equity and liabilities 1,711,697 1,458,009
Statutory Balance Sheet After Appropriation
This is an abbreviated version of the parent company's Financial Statements. A full version of the accounts (included the auditors report), that will be filled with the BNB/NBB, is available on
the Company's website www.titan-cement.com and can be obtained free of charge.
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Declaration by the persons
responsible
The Board of Directors hereby declares that, to the best of their knowledge:
a. The financial statements, prepared in accordance with International Reporting Standards (IFRS), give a true and fair view of the assets,
liabilities, financial position and profit or loss of the issuer and of the entities included in the consolidation;
b. The management report includes a fair review of the development and performance of the business and the position of the issuer and
of the entities included in the consolidation, together with a description of the main risks and uncertainties that these entities face.
For the Board of Directors,
7 April 2022
Chairman of the Board of Directors Managing Director- Group CFO
Efstratios- Georgios (Takis) Arapoglou Michael Colakides
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STATUTORY AUDITOR'S REPORT TO THE GENERAL SHAREHOLDERS’ MEETING OF TITAN
CEMENT INTERNATIONAL SA ON THE CONSOLIDATED ACCOUNTS FOR THE YEAR ENDED
31 DECEMBER 2021
We present to you our statutory auditor’s report in the context of our statutory audit of the consolidated
accounts of Titan Cement International SA (the “Company”) and its subsidiaries (jointly “the Group”).
This report includes our report on the consolidated accounts, as well as the other legal and regulatory
requirements. This forms part of an integrated whole and is indivisible.
We have been appointed as statutory auditor by the general meeting d.d. 13 May 2019, following the
proposal formulated by the board of directors and following the recommendation by the audit
committee. Our mandate will expire on the date of the general meeting which will deliberate on the
annual accounts for the year ended 31 December 2021. We have performed the statutory audit of the
Company’s consolidated accounts for 3 consecutive years.
Report on the consolidated accounts
Unqualified opinion
We have performed the statutory audit of the Group’s consolidated accounts, which comprise the
Consolidated Statement of Financial Position
as at 31 December 2021, the Consolidated Income
Statement, the Consolidated Statement of Comprehensive Income, the Consolidated Statement of
Changes in Equity and the Consolidated Cash Flow Statement for the year then ended, and notes to
the consolidated financial statements, including a summary of significant accounting policies and other
explanatory information, and which is characterised by a consolidated statement of financial position
total of ‘000 EUR 2,678,641 and a profit for the year attributable to equity holders of the parent of ‘000
EUR 91,923.
In our opinion, the consolidated accounts give a true and fair view of the Group’s net equity and
consolidated financial position as at 31 December 2021, and of its consolidated financial performance
and its consolidated cash flows for the year then ended, in accordance with International Financial
Reporting Standards as adopted by the European Union and with the legal and regulatory
requirements applicable in Belgium.
Basis for unqualified opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs) as applicable in
Belgium. Furthermore, we have applied the International Standards on Auditing as approved by the
IAASB which are applicable to the year-end and which are not yet approved at the national level. Our
responsibilities under those standards are further described in the “Statutory auditor’s responsibilities
for the audit of the consolidated accounts” section of our report. We have fulfilled our ethical
responsibilities in accordance with the ethical requirements that are relevant to our audit of the
consolidated accounts in Belgium, including the requirements related to independence.
We have obtained from the board of directors and Company officials the explanations and information
necessary for performing our audit.
PwC Bedrijfsrevisoren BV - PwC Reviseurs d'Entreprises SRL - Financial Assurance Services
Maatschappelijke zetel/Siège social: Culliganlaan 5, B-1831 Diegem
T: +32 (0)2 710 4211, F: +32 (0)2 710 4299, www.pwc.com
BTW/TVA BE 0429.501.944 / RPR Brussel - RPM Bruxelles / ING BE43 3101 3811 9501 - BIC BBRUBEBB /
BELFIUS BE92 0689 0408 8123 - BIC GKCC BEBB
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We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key audit matter
A key audit matter is a matter that, in our professional judgment, was of most significance in our audit
of the consolidated accounts of the current period. This matter was addressed in the context of our
audit of the consolidated accounts as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on this matter.
Impairment of goodwill, intangible assets, investments in Joint Ventures and PP&E
Description of the key audit matter
Titan Cement International Group carries significant values of property plant and equipment (PP&E),
goodwill, intangible assets and investments in joint ventures on the balance sheet amounting to EUR
1,545 million, 272 million, 91 million and 89 million respectively as at 31 December 2021 as detailed in
disclosure notes 11, 13, 14 and 15.
As required by the International Accounting Standard (‘IAS 36’), as endorsed by the EU, the Group is
required to test the amount of goodwill and indefinite useful life intangible assets for impairment at
least annually. IAS 36 also requires that assets subject to depreciation are reviewed for impairment
whenever events or changes in circumstances indicate that the carrying amount may not be
recoverable. International Accounting Standard (‘IAS 28’) states that investments in joint ventures are
assessed for impairment where indicators of impairment are present. The recoverable amount of the
joint venture is determined in accordance with IAS 36.
Goodwill, intangible assets, investment in joint ventures and property, plant and equipment are
allocated to cash generating units (CGUs). Management determines the recoverable amount for each
CGU as the higher of fair value less costs to sell and value in use. The calculation of the recoverable
amount of each CGU requires judgements applied by Management.
We consider this matter to be of most significance because of the complexity of the assessment
process and significant judgments in respect of assumptions about the future results of the business
and the discount rates applied to future cash flow forecasts. The most important assumptions relate to
the discount rate, sales volume and selling price evolutions, perpetual growth rates and operating
margins. We focused on the Egypt, Turkey and Brazil CGUs because they are most sensitive to
changes in key assumptions.
How our audit addressed the key audit matter
We evaluated management’s overall impairment testing process including assessing the process by
which the value in use models are reviewed and approved.
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MANAGEMENT REPORT
We evaluated the appropriateness of the use of the forecast period for the value in use calculation of
the CGUs.
We assessed the reliability of management’s estimates by comparing actual performance against
previous forecasts.
We tested the Group’s key assumptions for growth rates, sales volumes, selling prices and gross
margins in the future cash flow forecasts by comparing them to local industry trends and assumptions
made in the prior years and agreed them to approved financial budgets.
We critically assessed and checked the assumptions related to the long-term growth rates, by
comparing them to industry forecasts and historical growth rates.
We compared operating margin, working capital- and CAPEX percentages with past actuals.
We compared the weighted average cost of capital (“WACC”) to the cost of capital and debt of the
Group and comparable companies, as well as considering territory specific factors.
We tested the calculation method used and the accuracy thereof.
We evaluated the impact of alternative scenarios about discount rates, growth rates, selling prices and
gross margins on the recoverable amount of each CGU. We found that sufficient headroom remained
between the carrying value and the recoverable amount for all CGUs.
We included valuation specialists in our team to assist us with these procedures.
Based on the procedures performed we considered management’s key assumptions to be within a
reasonable range and disclosures in the financial statements to be adequate.
Responsibilities of the board of directors for the preparation of the consolidated accounts
The board of directors is responsible for the preparation of consolidated accounts that give a true and
fair view in accordance with International Financial Reporting Standards as adopted by the European
Union and with the legal and regulatory requirements applicable in Belgium, and for such internal
control as the board of directors determines is necessary to enable the preparation of consolidated
accounts that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated accounts, the board of directors is responsible for assessing the Group’s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern and
using the going concern basis of accounting unless the board of directors either intends to liquidate
the Group or to cease operations, or has no realistic alternative but to do so.
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Statutory auditor’s responsibilities for the audit of the consolidated accounts
Our objectives are to obtain reasonable assurance about whether the consolidated accounts as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s
report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a
guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if, individually
or in the aggregate, they could reasonably be expected to influence the economic decisions of users
taken on the basis of these consolidated accounts.
In performing our audit, we comply with the legal, regulatory and normative framework applicable to
the audit of the consolidated accounts in Belgium. A statutory audit does not provide any assurance as
to the Group’s future viability nor as to the efficiency or effectiveness of the board of directors’ current
or future business management at Group level. Our responsibilities in respect of the use of the going
concern basis of accounting by the board of directors are described below.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the consolidated accounts, whether
due to fraud or error, design and perform audit procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of
not detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control;
• Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Group’s internal control;
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the board of directors;
• Conclude on the appropriateness of the board of directors’ use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Group’s ability to continue
as a going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our statutory auditor’s report to the related disclosures in the consolidated accounts
or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the
audit evidence obtained up to the date of our statutory auditor’s report. However, future events
or conditions may cause the Group to cease to continue as a going concern;
• Evaluate the overall presentation, structure and content of the consolidated accounts, including
the disclosures, and whether the consolidated accounts represent the underlying transactions
and events in a manner that achieves fair presentation;
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MANAGEMENT REPORT
• Obtain sufficient and appropriate audit evidence regarding the financial information of the
entities or business activities within the Group to express an opinion on the consolidated
financial statements. We are responsible for the direction, supervision and performance of the
Group audit. We remain solely responsible for our audit opinion.
We communicate with the audit committee regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the audit committee with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, related
safeguards.
From the matters communicated with the audit committee, we determine those matters that were of
most significance in the audit of the consolidated accounts of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes
public disclosure about the matter.
Other legal and regulatory requirements
Responsibilities of the board of directors
The board of directors is responsible for the preparation and the content of the directors’ report on the
consolidated accounts and the other information included in the integrated annual report on the
consolidated accounts.
Statutory auditor’s responsibilities
In the context of our engagement and in accordance with the Belgian standard which is
complementary to the International Standards on Auditing (ISAs) as applicable in Belgium, our
responsibility is to verify, in all material respects, the directors’ report on the consolidated accounts
and the other information included in the integrated annual report on the consolidated accounts and to
report on these matters.
Aspects related to the directors’ report on the consolidated accounts and to the other
information included in the annual report on the consolidated accounts
In our opinion, after having performed specific procedures in relation to the directors’ report on the
consolidated accounts, this directors’ report is consistent with the consolidated accounts for the year
under audit and is prepared in accordance with article 3:32 of the Companies' and Associations' Code.
In the context of our audit of the consolidated accounts, we are also responsible for considering, in
particular based on the knowledge acquired resulting from the audit, whether the directors’ report on
the consolidated accounts and the other information included in the annual report on the consolidated
accounts is materially misstated or contains information which is inadequately disclosed or otherwise
misleading. In light of the procedures we have performed, there are no material misstatements we
have to report to you.
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TITAN CEMENT GROUP
The non-financial information required by virtue of article 3:32, §2 of the Companies' and Associations'
Code is included in the directors’ report on the consolidated accounts which is part of the section
“Management Report; ESG Performance statements” of the integrated annual report. The Company
has prepared the non-financial information, based on the UN Global Compact Communication on
Progress Guidelines, the Charter and Guidelines of the Global Cement and Concrete Association and
the UN SDGs 2030. However, in accordance with article 3:80, §1, 5° of the Companies' and
Associations' Code, we do not express an opinion as to whether the non-financial information has
been prepared based on the UN Global Compact Communication on Progress Guidelines, the Charter
and Guidelines of the Global Cement and Concrete Association and the UN SDGs 2030 as disclosed
in the directors’ report on the consolidated accounts.
European Uniform Electronic Format (ESEF)
We have also verified, in accordance with the draft standard on the verification of the compliance of
the financial statements with the European Uniform Electronic Format (hereinafter “ESEF”), the
compliance of the ESEF format with the regulatory technical standards established by the European
Delegate Regulation No. 2019/815 of 17 December 2018 (hereinafter: “Delegated Regulation”).
The board of directors is responsible for the preparation, in accordance with ESEF requirements, of
the consolidated financial statements in the form of an electronic file in ESEF format (hereinafter
“consolidated financial statements”) included in the annual financial report.
Our responsibility is to obtain sufficient appropriate evidence to conclude that the format and marking
language of the digital consolidated financial statements comply in all material respects with the ESEF
requirements under the Delegated Regulation.
Based on the work we have performed, we believe that the format of and marking of information in
the digital consolidated financial statements included in the annual financial report of Titan Cement
International SA per 31 December 2021 comply in all material respects with the ESEF requirements
under the Delegated Regulation.
Statement related to independence
භ Our registered audit firm and our network did not provide services which are incompatible with
the statutory audit of the consolidated accounts, and our registered audit firm remained
independent of the Group in the course of our mandate.
භ The fees for additional services which are compatible with the statutory audit of the consolidated
accounts referred to in article 3:65 of the Companies' and Associations' Code are correctly
disclosed and itemized in the notes to the consolidated accounts.
Other statements
භ This report is consistent with the additional report to the audit committee referred to in article 11
of the Regulation (EU) N° 537/2014.
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Diegem, 8 April 2022
The statutory auditor
PwC Reviseurs d'Entreprises SRL / PwC Bedrijfsrevisoren BV
Represented by
Didier Delanoye
Réviseur d’Entreprises / Bedrijfsrevisor
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INTEGRATED ANNUAL REPORT 2021
TITAN CEMENT GROUP
Independent Assurance Statement to the Board of Directors of Titan Cement International S.A.
ERM Certification and Verification Services Limited (‘ERM CVS’) was engaged by Titan Cement
International S.A. (‘TITAN Group’) to provide assurance in relation to the information set out below and
presented in TITAN’s Integrated Annual Report 2021 for the reporting year ended 31 December 2021 (the
‘Report’).
Engagement Summary
Assurance
Scope
1. Whether the following disclosures in the Report are fairly presented, in all material
respects, with the reporting criteria:
“Focusing on material issues” in section “Understanding TITAN” on pages 18
to 19.
“Making progress towards our ESG targets” in section “Understanding TITAN”
on pages 30 to 31
The information and 2021 performance data disclosed in section
“Management Report; ESG performance overview” on pages 82 to 97
The Group data for the non-financial metrics relating to the period January 1
to December 31 2021 indicated within the assurance column in section
“Management Report; ESG Performance statements” in tables 2.1 through 2.4
on pages 103 to 123.
2. Whether the relevant 2021 data and disclosures in the Report are aligned with the
following GCCA requirements:
Sustainability Charter (October 2019)
Sustainability Framework Guidelines (October 2019)
Sustainability Guidelines for co-processing fuels and raw materials in cement
manufacturing (October 2019)
Sustainability Guidelines for Quarry Rehabilitation and Biodiversity
Management (May 2020)
Sustainability Guidelines for the monitoring and reporting of:
Safety in cement and concrete manufacturing (February 2020) with
extended application to concrete and other related activities
CO
2
emissions from cement manufacturing (October 2019)
Emissions from cement manufacturing (October 2019)
Water in cement manufacturing (October 2019)
3. Whether the Report meets the UN Global Compact criteria relating to a
Communication on Progress (COP) Advanced Level.
Reporting
Criteria
GCCA requirements for the scope referenced above;
UN Global Compact COP Advanced Level; and
as presented in notes to Tables 2.1-2.4 as referenced above.
Assurance
Standard and
Level of
Assurance
International Standard on Assurance Engagements ISAE 3000 (Revised) ‘Assurance
Engagements other than Audits and Reviews of Historical Financial Information’ issued by
the International Auditing and Assurance Standards Board (IAASAB) of the International
Federation of Accountants (IFAC). This standard requires that we comply with ethical,
competence and quality requirements, and plan and perform the assurance engagement
to obtain a reasonable level of assurance.
Respective
Responsibilities
The Board of TITAN Group is responsible for preparing the Report and for the collection
and presentation of the disclosures covered by the scope of our engagement. Also for
designing, implementing and maintaining effective internal controls over the information
and data.
ERM CVS’ responsibility is to provide an opinion, based on the assurance activities
undertaken and exercising our professional judgement, on whether the information
covered by the scope of our engagement has been prepared in accordance with the
stated reporting criteria. ERM CVS disclaims any liability for any decision a person or
entity may make based on this Assurance Statement.
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Our opinion
We have assured selected information in the Report as detailed under ‘Assurance Scope’ above. In our
opinion:
1. The performance disclosures and data in the Report as described under ‘Assurance Scope (1)’ above are
fairly presented, in all material respects, in accordance with the reporting criteria;
2. The relevant 2021 data and disclosures in the Report are aligned with the following GCCA requirements:
Sustainability Charter (October 2019)
Sustainability Framework Guidelines (October 2019)
Sustainability Guidelines for co-processing fuels and raw materials in cement manufacturing
(October 2019)
Sustainability Guidelines for Quarry Rehabilitation and Biodiversity Management (May 2020)
Sustainability Guidelines for the monitoring and reporting of:
Safety in cement and concrete manufacturing (February 2020) with extended application to
concrete and other related activities
CO
2
emissions from cement manufacturing (October 2019)
Emissions from cement manufacturing (October 2019)
Water in cement manufacturing (October 2019)
3. The Report meets the UN Global Compact criteria relating to a Communication on Progress (COP)
Advanced Level.
Our reasonable assurance activities
We planned and performed our work to obtain sufficient and appropriate evidence to support our opinion, and
to reduce the risk of a material error or omission in the assured information to low, but not absolute. Our
assurance procedures included, but were not restricted to, the following activities:
A review of external media reports to identify relevant sustainability issues for TITAN Group in the
reporting period;
A review of the suitability of the reporting criteria and related internal reporting processes, including
conversion factors, estimates and assumptions used;
A virtual meeting with TITAN Group’s Head Office in Athens, Greece to understand any (planned) changes
to TITAN Group’s sustainability strategy, the Report and related reporting systems and processes, internal
controls and responsibilities in 2021;
Virtual visits to TITAN Group’s cement operations in Greece (Patras) and Albania (ANTEA), and RMC
operations in Greece (Drepano) to verify the source data underlying the 2021 data for the information in
our assurance scope and to review local environmental and safety management, procurement procedures,
labour and human rights and stakeholder/community engagement. TITAN Group explained that the two
cement operations contributed circa 14.4% of the Group’s cement production and circa 15% of net CO
2
emissions for the reporting year;
Virtual meeting with TITAN Group’s cement operations in Egypt (Beni Suef) to verify source data and
review management procedures for reported Scope 3 GHG emissions;
An assessment of the reports and conclusions of accredited third-party verification bodies relating to the
verification of Scope 1 GHG emissions that fall within the scope of the EU emissions trading scheme (EU
ETS). These provided coverage of an additional circa 22.5% of TITAN Group’s net CO
2
emissions
(excluding Patras to avoid double counting with sites visited);
An analytical review and substantive testing (on a sample basis) of the 2021 data submitted by all sites
included in the consolidated corporate data for the selected disclosures, and follow-up and close out of our
queries;
Substantive procedures relating to the consolidation of the 2021 data for the selected disclosures;
A second virtual meeting over two-days with TITAN Group’s Head Office in Athens, Greece to:
review activities across the business during 2021 regarding stakeholder engagement and in
relation to TITAN Group’s identified material issues;
test the effectiveness of internal controls in relation to the accuracy and completeness of the 2021
corporate consolidated data for the indicators in the scope of our engagement;
collect additional evidence through an extensive series of interviews with management
representatives (including the Chief Sustainability Officer, ESG department, Environment, Safety,
Human resources, Finance, Procurement, Legal and Internal Audit), and reviewed further evidence
in underlying management and reporting systems such as the Global HR Management System and
documents including the minutes of meetings of governance bodies; and
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A review of the presentation of information relevant to the scope of our work in the Report to ensure
consistency with our findings.
The limitations of our engagement
We do not express any opinion on any other information in the Report or on TITAN Group’s website for the
current reporting period, or on the baseline values used for presenting performance against targets. We do not
provide any assurance on prospective information including ambitions, plans, expectations or the achievability of
targets.
For previous periods (2016-2020) we refer to our Assurance Statements in the Integrated Annual Reports for
those years in order to understand the scope, activities and related opinions. The reliability of the assured 2021
data is subject to inherent uncertainties, given the available methods for determining, calculating or estimating
the underlying information so it is important to understand our assurance opinion in this context.
Our independent assurance statement provides no assurance on the maintenance and integrity of TITAN
Group’s website, including controls used to achieve this or, in particular, whether any changes may have
occurred to the information since it was first published.
Force Majeure – COVID-19
As a result of travel restrictions arising from the current global pandemic, we were unable to carry out our
assurance activities as originally planned and agreed with TITAN Group. In-person visits to operations and the
head office were replaced with remote reviews via teleconference and video calls for this year’s assurance
engagement. Whilst we believe these changes do not affect our reasonable assurance opinions above, we
draw attention to the possibility that if we had undertaken in-person visits, we may have identified errors and
omissions in the assured information that we did not discover through the alternative approach.
Ethics, independence, competence and quality control
ERM CVS is a member of the ERM Group and all employees are subject to ERM’s Global Code of business
conduct and ethics. ERM CVS is accredited by the United Kingdom Accreditation Service (UKAS) and our
operating system is designed to comply with ISO 17021:2011.
We have policies and procedures in place covering quality, independence and competency. In line with
established best practice for non-financial assurance, this engagement was undertaken by a team of assurance,
EHS and sustainability professionals. The work that ERM CVS conducts for clients is solely related to
independent assurance activities and auditor training. Our established management processes are designed
and implemented to ensure the work we undertake with clients is free from organisational and personal conflicts
of interest or bias.
ERM CVS and the staff that have undertaken this assurance engagement provide no consultancy related
services to Titan Cement International S.A. in any respect.
Gareth Manning
Partner, Corporate Assurance
1 April 2022
ERM Certification and Verification Services Limited, London
www.ermcvs.com | Email: post@ermcvs.com
232
Glossary
Financial
CAPEX: Acquisitions/additions of property, plant and equipment,
right of use assets, investment property and intangible assets. It
allows management to monitor the capital expenditure.
EBITDA: Operating profit before impairment losses on goodwill
plus depreciation, amortization and impairment of tangible and
intangible assets and amortization of government grants. It
provides a measure of operating profitability that is comparable
among reportable segments consistently.
Net debt: Sum of long-term borrowings and lease liabilities, plus
short-term borrowings and lease liabilities (collectively gross
debt), minus cash and cash equivalents. It allows management to
monitor the indebtedness.
NPAT: Profit after tax attributable to equity holders of the
parent. It provides a measure of total profitability that is
comparable over time.
Operating free cash flow: Cash generated from operations
minus payments for CAPEX. It measures the capability of the
Group in turning profit into cash through the management of
operating cash flow and capital expenditure.
Operating profit before impairment losses on goodwill: Profit
before income tax, share of gain or loss of associates and joint
ventures, gains or losses from foreign exchange differences, net
finance costs, other income or loss and impairment losses on
goodwill. It provides a measure of operating profitability that is
comparable over time.
Operating profit: Profit before income tax, share of gain or loss
of associates and joint ventures, gains or losses from foreign
exchange differences, net finance costs and other income or loss.
It provides a measure of operating profitability that is comparable
over time.
ESG
Aqueduct: The World Resource Institute’s (WRI) Aqueduct Water
Risk Atlas is a publicly-available online global database of local-
level water risk indicators and a global standard for measuring
and reporting geographic water risk. The World Resources
Institute is a global, independent, non-partisan and non-profit
research organization, with mission to move human society to
live in ways that protect Earth’s environment and its capacity
to provide for the needs and aspirations of current and future
generations.
CDP: CDP Global is an international non-profit organization
comprising of CDP Worldwide Group, CDP North America, Inc.
and CDP Europe AISBL, founded in 2000. CDP runs a global
environmental disclosure system supporting companies,
cities, states and regions to measure and manage their risks
and opportunities on climate change, water security and
deforestation. CDP takes the information supplied in its annual
reporting process and scores companies and cities based on
their performance progress using an independent scoring
methodology.
COP: The Communication on Progress is intended as a
mechanism to inform, in a standardized format of an annual
report, company stakeholders (e.g., investors, consumers, civil
society, and governments) on progress made in implementing
the Ten Principles of the United Nations Global Compact.
CSR Europe: The leading European business network for
Corporate Sustainability and Responsibility. The network
supports businesses and industry sectors in their transformation
and collaboration towards practical solutions and sustainable
growth. The ambition is the systemic change; therefore,
following the SDGs, the network seeks to co-build with the
European leaders and stakeholders an overarching strategy for a
Sustainable Europe 2030.
ECRA: The European Cement Research Academy (ECRA) was
founded in 2003 supports and conducts research activities on
the production of cement and its application in concrete aiming
at advancing innovation within the context of climate change
mitigation and sustainable construction.
GCCA: The Global Cement and Concrete Association is a CEO-led
industry initiative established in 2018, representing the global
voice of the sector. The GCCA took over the role of the former
CSI Project of the WBCSD and has carried, since 1 January 2019,
the work programs and sustainable development activities of the
CSI, with key objectives to develop and strengthen the sector’s
contribution to sustainable construction across the value
chain, and to foster innovation in collaboration with industry,
associations and key experts-stakeholders.
IBAT: The Integrated Biodiversity Assessment Tool, developed
through a partnership of global conservation leaders including
BirdLife International, Conservation International and IUCN,
provides key decision-makers with access to critical information
on biodiversity priority sites, to inform decision-making
processes and address potential impacts.
IIRC: The International Integrated Reporting Council is a global
coalition of regulators, investors, companies, standard setters,
the accounting profession, academia and NGOs. The coalition
promotes communication about value creation as the next step
in the evolution of corporate reporting.
RECODE: Pilot project where TITAN engages with the European
Union and collaborates with international stakeholders from
the industry and academia, the aim being to advance in climate
change-related innovation, and explore technical solutions for
reducing CO₂ emissions, while developing more sustainable
products.
SASB: The Sustainability Accounting Standards Board is an
independent standards board that is accountable for the
due process, outcomes, and ratification of its standards, the
application of which (being the SASB’s mission) is to help
businesses around the world identify, manage and report on
sustainability topics that matter most to their investors.
SBTi: The SBTi is a partnership between CDP, the United Nations
Global Compact, World Resources Institute (WRI) and the World
Wide Fund for Nature (WWF). SBTi aim is to mobilize companies
to take the lead on urgent climate actions and guide them in
setting science-based targets that could limit global warming to
1.5oC, achieve a net-zero world by no later than 2050 and prevent
the worst effects of climate change.
SDGs: The Sustainable Development Goals are a collection of 17
global goals designed to be a “blueprint to achieve a better and
more sustainable future for all”. The SDGs, set in 2015 by the
United Nations General Assembly and intended to be achieved by
the year 2030, are part of UN Resolution 70/1, the 2030 Agenda.
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TAXONOMY: The EU taxonomy is a classification system,
establishing a list of environmentally sustainable economic
activities. It could play an important role helping the EU scale up
sustainable investment and implement the European green deal.
TCFD: Established by the Financial Sustainability Board in 2016,
the Task Force on Climate-related Financial Disclosures is a
market- driven coalition with the mission to develop voluntary,
consistent climate-related financial risk disclosures for use
by companies in providing information to stakeholders (like
investors, lenders and insurers).
UNCTAD: The United Nations Conference on Trade and
Development is a United Nations body responsible for dealing
with economic and sustainable development issues with a focus
on trade, finance, investment and technology, in particular for
helping developing countries to participate equitably in the
global economy.
UNGC: The United Nations Global Compact is a voluntary
initiative based on CEO commitments to implement universal
sustainability principles (‘Ten Principles’) and to take steps
to support UN goals. ‘Ten Principles’ are derived from the
Universal Declaration of Human Rights, the International Labour
Organization’s Declaration on Fundamental Principles and Rights
at Work, the Rio Declaration on Environment and Development,
and the United Nations Convention Against Corruption.
WBCSD: The World Business Council for Sustainable
Development is a global, CEO-led organization of over 200
leading businesses working together to accelerate the transition
to a sustainable world, helping member companies to become
more successful and sustainable by focusing on the maximum
positive impact for shareholders, the environment and societies.
WRI: The World Resources Institute is a global, independent,
non-partisan and non-profit research organization, with mission
to move human society to live in ways that protect Earth’s
environment and its capacity to provide for the needs and
aspirations of current and future generations.
Titan Cement International S.A.
Rue de la Loi 23,
1040 Brussels, Belgium
Tel.: (+32) 27 26 8058
www.titan-cement.com