Loma Negra (LOMA) Q1 2025 earnings summary

Executive summary

• Net revenues for 1Q25 were Ps. 163.2 billion (US$149 million), down 8.9% year-over-year, mainly due to a 10.9% decline in the Cement segment's top line, but volumes rebounded and pricing remained soft.

• Adjusted EBITDA was Ps. 39.2 billion (US$40 million), down 3.2% year-over-year, with margin improving to 24.0% (+140 bps YoY) due to efficiency and cost control efforts.

• Net profit attributable to owners was Ps. 21.5 billion, a 73% decrease from Ps. 79.1 billion in 1Q24, mainly due to lower financial gains as inflationary effects moderated.

• Cement volumes increased 8.9% year-over-year, with bagged cement outperforming bulk; other segments also saw double-digit volume growth despite adverse weather early in the year.

• The company maintained a robust balance sheet, with Net Debt/LTM Adjusted EBITDA at 0.96x, and remains focused on profitability.

Financial highlights

• Gross profit declined 4.7% year-over-year, but gross margin improved by 116 bps to 26.4%.

• Adjusted EBITDA margin rose to 24.0% from 22.6% YoY.

• EPS was Ps. 36.80, down 72.9% YoY.

• SG&A expenses decreased 7.8% year-over-year, mainly due to lower marketing, IT, and salary costs, but as a percentage of sales rose to 11.7%.

• Cash and investments stood at Ps. 10.6 billion, with total debt at Ps. 197.2 billion as of 1Q25.

Outlook and guidance

• Management expects continued recovery in cement consumption, with April volumes up 28% YoY and 13% sequentially.

• If Argentina's economy achieves projected 5% GDP growth, construction and cement demand should strengthen further.

• Double-digit volume growth is expected for 2025, though monthly growth rates may moderate after April's surge.

• Pricing per ton is expected to remain sustainable around $115, with potential for further increases if costs rise.

• Macroeconomic stabilization and recent policy changes in Argentina are expected to support growth and attract foreign investment.