Loma Negra Compañía Industrial Argentina Sociedad Anónima (LOMA) Q1 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call presents a mixed outlook. While there is optimism for double-digit growth in 2025 and a strong EBITDA margin, current financial metrics show a decline in revenue and net profit, alongside increased net debt. The Q&A reveals stable market share but lacks clarity on key projects. Economic, competitive, and supply chain risks persist, impacting sentiment. With no new partnerships or significant guidance changes, the stock reaction is likely neutral, reflecting both positive long-term growth potential and short-term challenges.
Key Financial Performance
Revenue First quarter top-line decreased by 8.9% year-over-year, primarily due to weaker performance in the Cement segment and declines across other business areas.
Adjusted EBITDA Consolidated adjusted EBITDA for the quarter stood at $40 million, reflecting a 3.2% year-over-year decline, primarily driven by lower EBITDA generation in the Cement segment.
Net Profit Net profit attributable to owners of the company totaled ARS 21.5 billion, compared to ARS 79 billion in the first quarter of 2024, primarily driven by a lower financial result.
Net Debt Net debt increased to ARS 187 million, with a net debt-to-EBITDA ratio of 0.96x, slightly up from 0.89x at the end of 2024, as the first quarter is typically more capital intensive.
Cash Flow from Operating Activities Cash flow used in operating activities totaled ARS 1.3 billion, a significant improvement compared to ARS 12 million used in the first quarter of 2024, primarily driven by reduced need for working capital.
Capital Expenditure Invested ARS 11.1 billion in capital expenditure during the quarter, mainly directed towards the final stage of the 25 kilograms back projects and maintaining CapEx.
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Operating Highlights
Cement Consumption: Cement consumption showed signs of improvement, with an 11% year-over-year increase in the first quarter.
Market Recovery: The construction sector is expected to benefit from a projected 5% GDP growth for Argentina, indicating a potential robust recovery.
Sales Volumes: April data indicates segment volumes growing 28% year-over-year and 14% sequentially.
Cost Management: The company improved its margin by 140 basis points compared to the same period last year, driven by cost control efforts.
EBITDA Performance: Consolidated adjusted EBITDA for the quarter stood at $40 million, reflecting a 3.2% year-over-year decline.
SG&A Expenses: SG&A expenses decreased by 7.8%, mainly due to lower marketing and IT expenditures.
Investment Projects: Changes in exchange freight policy and easing of capital control may unlock investment projects that have been on hold.
Operational Focus: The company remains focused on driving efficiencies and controlling costs to protect profitability.
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Risk or Challenges
Economic Growth Risks: The company is optimistic about a projected 5% GDP growth for Argentina, but this is contingent on the economy meeting these forecasts. Any deviation could impact the construction sector and cement consumption.
Weather-Related Challenges: Adverse weather conditions in early months affected the recovery of the construction sector, indicating vulnerability to environmental factors.
Competitive Pressures: The cement and concrete segments are facing pricing pressures due to a more competitive market environment, which could impact profitability.
Supply Chain Disruptions: A severe storm disrupted railroad connections, affecting the transport of products and potentially leading to delays and increased costs.
Inflation and Financial Performance: The company reported a significant decline in net profit due to lower financial results, reflecting a more moderate inflationary environment, which could affect future earnings.
Debt Management: Net debt increased to $174 million, raising concerns about financial leverage, especially in a capital-intensive quarter.
Market Volatility: The company is navigating through economic volatility and uncertainty, which could impact operational stability and investment decisions.
Regulatory Changes: Changes in exchange freight policy and capital controls may have short-term impacts as industry participants adjust, but are expected to provide long-term benefits.
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Guidance & Outlook
Capital Expenditure: Invested ARS 11.1 billion in capital expenditure during the quarter, mainly directed towards the final stage of the 25 kilograms back projects and maintaining CapEx.
Debt Management: Net debt stood at $174 million, with a duration of less than one year. The company’s debt profile remains well balanced with class two bond scheduled to mature on December 2025.
Operational Efficiency: Focused on driving efficiencies and controlling costs to protect profitability while maintaining strong balance sheets.
Market Recovery: Expecting a more sustained and deeper recovery in the coming quarters, supported by a projected 5% GDP growth for Argentina.
Revenue Outlook: If the economy meets the projected growth, particularly in the construction sector, a more robust recovery is anticipated in the months ahead.
EBITDA Margin: Consolidated EBITDA margin expanded to 24%, representing a year-over-year increase of 140 basis points.
Net Profit: Net profit attributable to owners of the company totaled ARS 21.5 billion for the quarter, compared to a net gain of ARS 79 billion in the first quarter of 2024.
Debt-to-EBITDA Ratio: Net debt-to-EBITDA ratio remains comfortable below one times.
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Shareholder Return Plan
Net Debt: $174 million
Net Debt to EBITDA Ratio: 0.96x
Cash Flow from Operating Activities: $15 billion generated from financial activities
Capital Expenditure: $11.1 billion invested during the quarter
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Key Q&A
Q:What are you seeing on the ground regarding market share dynamics and demand at the regional level?
A:The numbers of market share in the first quarter are according to or following our strategy. We are comfortable within our range of market share. Changes quarter-to-quarter could be due to various reasons, including climate issues and pricing strategy. We are not worried about the current situation.
Q:How do you see pricing power going forward, and what range of cement volumes are you expecting for this year?
A:Pricing for the first quarter is around $115, which is sustainable. We expect some adjustments in costs that could impact pricing. We are optimistic about growing in double-digits in 2025, despite potential lower increases in year-on-year comparisons.
Q:Can you comment on your backlog regarding potential cement demand from the Rigi project and the housing sector?
A:Forecasts are positive, but no single project will significantly impact total volumes. We see many tenders moving forward, especially in the Concrete segment, with projects expected to start in the second semester.
Q:Is there an update on the turbine program for L'Amali?
A:We don't have updates on that. We are testing winds in L'Amali and have some renewable energy projects, but no contracts signed yet.
Q:Review of Unclear Management Responses
A:Management did not provide a direct answer regarding the turbine program for L'Amali, stating they have no updates.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
ARS decline
Buenos Aires
Cement segment
Chief
Diego
Loma Negra
Officer
Railroad
Volume
construction material
contraction
cost effect
decline increase
effect cost
front
gain ARS
grain transport
increase volume
kilometer
material grain
mix
operation
point Cement
pressure
pricing dynamic
product
province Buenos
quarter
rise
road construction
salary cost
segment decline
segment margin
sign
stage
volume pricing
weather condition
LOMA Transcript
Loma Negra Compañía Industrial Argentina Sociedad Anónima (LOMA) Q3 2025 Earnings Call Transcript
Unknown11-7
The earnings call reveals several challenges: declining revenues across segments, increased leverage, and working capital challenges. Despite some optimism in volume performance, the company faces significant financial pressures, including FX exposure and competitive pressures. The Q&A section highlights uncertainties in pricing and dividend plans, adding to investor concerns. Overall, the sentiment leans negative due to financial struggles and lack of clear positive catalysts.
Loma Negra Compañía Industrial Argentina Sociedad Anónima (LOMA) Q2 2025 Earnings Call Transcript
Neutral8-8
Loma Negra Compañía Industrial Argentina Sociedad Anónima (LOMA) Q1 2025 Earnings Call Transcript
Unknown5-7
The earnings call presents a mixed outlook. While there is optimism for double-digit growth in 2025 and a strong EBITDA margin, current financial metrics show a decline in revenue and net profit, alongside increased net debt. The Q&A reveals stable market share but lacks clarity on key projects. Economic, competitive, and supply chain risks persist, impacting sentiment. With no new partnerships or significant guidance changes, the stock reaction is likely neutral, reflecting both positive long-term growth potential and short-term challenges.
Loma Negra Compañía Industrial Argentina Sociedad Anónima (LOMA) Q4 2024 Earnings Call Transcript
Unknown3-7
The financial performance shows mixed results: a significant revenue decline but improved EBITDA margins and net profit. The Q&A reveals uncertainty in dividend distribution and CapEx plans, with some positive outlook for 2025. The market recovery expectation and debt reduction are positive, yet economic and regulatory risks persist. Overall, the sentiment is neutral as the positive and negative factors balance out.
LOMA Report
Frequently Asked Questions
Where does this earnings call transcript come from?
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Who creates the AI Summary and Key Q&A highlights shown above the transcript?
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
