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Loma Negra shares 2Q20 results

Published by , Deputy Editor
World Cement,

2Q20 Key Highlights

  • Net revenue decreased 30.1% YoY to Ps.7.453 million (US$108 million), reflecting the full impact of the COVID-19 pandemic and the extended lockdown.
  • Consolidated Adjusted EBITDA down 24.6% YoY to Ps.2.077 million (US$32 million).
  • Consolidated Adjusted EBITDA margin expanded by 204 basis points YoY from 25.8% to 27.9%, driven by cost control efforts and efficiency enhancement from previous structure adequacy efforts.
  • Net Debt /LTM Adjusted EBITDA ratio of 1.17x from 1.26x in 1Q20 and 0.86x in FY19.

Commenting on the financial and operating performance for the second quarter of 2020, Sergio Faifman, Loma Negra’s Chief Executive Officer, noted: “As a consequence of the COVID-19 pandemic, we entered the second quarter amid an unprecedented nation-wide lockdown which negatively impacted our businesses. Along the quarter, and depending on how the sanitation situation developed in each jurisdiction, some of these restrictions were softened, or even lifted. In anticipation of the effects of COVID-19, we took proactive measures with special focus on adopting strict biosafety protocols in our operations and maintaining our financial strength on our balance sheet.”

“Cement demand in Argentina in the second quarter contracted around 32% YoY and around 4% when compared sequentially with the previous quarter. Taking a closer look on the behaviour of our demand, we observed that the initial plummeting of sales in April was followed by a strong recovery since May in the bag segment across the country.”

“Our top line for the quarter decreased also around 30% year-on-year to 7.5 billion pesos, and our adjusted EBITDA declined by 24.6% to 2.1 billion pesos. Our EBITDA margin expanded by 204 basis points to 27.9%, mainly reflecting our efforts in cost control and our commitment to maintaining a healthy productivity and efficiency levels. Our core cement business remained the principal factor behind the margin expansion.”

“As previously anticipated, works on L´Amalí project were resumed in late April after the temporarily restrictions due to the COVID-19 were lifted. Certainly, this suspension together with the biosafety protocols adopted has delayed the inauguration date of the project, which is now expected to be at the beginning of 2021.”

“We remain alert and cautious regarding the evolution of this worldwide crisis, of which the ending seems hard to predict. I would finally like to thank our people who, in this unprecedented COVID-19 situation, showed a great responsibility and resourcefulness in order to overcome difficulties and to keep on running the business.”

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