Loma Negra Compañía Industrial Argentina Sociedad Anónima

Second-quarter consolidated net revenue increased 2.1% year over year to Ps. 238.1 billion. Cement volume decreased 1.4% year over year; industry dispatches declined 5% year over year. Consolidated gross profit decreased 3.9% year over year and gross margin contracted 122 basis points to 19.2%. Consolidated adjusted EBITDA was Ps. 48.2 billion, down 2.5% year over year, with margin at 20.2% (down 87 basis points per management’s prepared remarks; 97 basis points was also cited earlier in the call). Net profit attributable to owners of the company totaled Ps. 7.5 billion versus Ps. 0.5 billion a year ago. Net financial loss was Ps. 5.6 billion versus Ps. 22.3 billion last year. Net debt was Ps. 274 billion, or $185 million in U.S. dollar terms, at 1.3x net debt to adjusted EBITDA. Cash flow from operating activities was Ps. 18.1 billion versus a Ps. 29.7 billion outflow in the prior-year quarter. CapEx was Ps. 9.7 billion. For the full year, management said there are no remaining structured debt maturities after the $10 million bond cancellation; no explicit revenue or EBITDA guidance was given.

Sergio Faifman said the quarter was held back by weak April weather, but May and June moved back toward prior-year levels. He emphasized that volume recovery is likely to be gradual and uneven, not a straight line, but said the underlying trend for the second half and beyond remains positive. He pointed to RIGI projects, road concessions, potential easing in monetary conditions, improving real wages, and possible credit recovery as sources of support, while stressing cost discipline and operational efficiency.

Marcos Gradin focused on margin pressure from higher costs, especially freight, the 25-kilogram bag transition, depreciation from the bagging project, salaries, and higher fuel prices. He said the 25-kilogram bag price increase has been passed through, and that starting in September the company will restart kilns under energy contracts with better terms than the last production cycle, which should help costs. He also highlighted improved operating cash flow of Ps. 18.1 billion, lower CapEx at Ps. 9.7 billion after completion of the bagging project, and lower leverage at 1.3x net debt/EBITDA.

Analysts pressed on whether weaker credit access would delay the second-half recovery and on which cost pressures are temporary versus recurring. Management said it is difficult to expect a meaningful credit improvement soon, but cited RIGI projects, road concessions, and the seasonal pickup from September as offsetting drivers. On costs, management separated one-time and ongoing factors, noting freight and winter energy effects, the bag transition and related depreciation, and said upcoming kiln restarts under better energy contracts plus higher volume should improve margins.