Loma Negra (LOMA) Q3 2024 earnings summary

Executive summary

• Net revenues for 3Q24 were ARS 180.7 billion (US$185 million), down 21.2% year-over-year, mainly due to lower cement dispatches and volumes.

• Adjusted EBITDA was ARS 43.3 billion (US$55 million), down 18.5% year-over-year, with margin expanding 78 basis points to 24.0%.

• Net profit attributable to owners was ARS 20.9 billion, down from ARS 22.9 billion in Q3 2023.

• Industry volumes showed a strong sequential improvement, up 25% from the previous quarter, though still below last year’s level.

• Operational resilience and cost control supported margins despite revenue contraction.

Financial highlights

• Cement and lime segment revenue declined 21%, with volumes down 17.1% year-over-year.

• Concrete revenues fell 29.7% due to a 22% drop in dispatches; Adjusted EBITDA margin improved to 4.2%.

• Aggregates segment sales dropped 42.4%, with volumes down 28.7%; Adjusted EBITDA margin contracted to -17.0%.

• Railroad revenues declined 4.7%, with transported volumes down 7%; Adjusted EBITDA margin expanded to 12.6%.

• Gross profit fell 23.5%, margin contracted 69 basis points to 22.6%.

Outlook and guidance

• Sequential volume recovery and margin expansion are seen as signs that the most challenging period is behind.

• Management anticipates a much stronger recovery ahead as macroeconomic factors stabilize.

• Declining inflation and interest rates, plus potential expansion of credit and mortgage loans, could drive construction sector growth.

• Reduction in country risk below 1,000 points may attract foreign investment.

• Optimism for near-term growth driven by positive economic variables, credit, and FDI potential.