Loma Negra, (NYSE: LOMA) (BYMA: LOMA), (“Loma Negra” or
the “Company”), the leading cement producer in Argentina, today
announced results for the three-month and six-month period ended
June 30, 2019 (our “2Q19”).
2Q19 Key Highlights
- Net revenue decreased 2.2% YoY to Ps.7,470 million (US$165
million)
- Consolidated Adjusted EBITDA up 7.1% YoY to Ps.1,929 million
(US$44 million), principally driven by the Cement, masonry, and
lime segment in Argentina, further supported by growth across the
main other segments, and partially offset by non-recurrent
production-footprint adequacy costs of approximately Ps.188 million
(US$4 million).
- Excluding this non-recurrent charge, Adjusted EBITDA would have
been Ps.2,117 million (US$49 million)
- Consolidated Adjusted EBITDA margin expanded by 225 basis
points YoY from 23.6% to 25.8%, excluding non-recurrent
production-footprint adequacy costs, Consolidated Adjusted EBITDA
would have been 28.3%, expanding 476 basis points
- Net Debt /LTM Adjusted EBITDA ratio of 0.76x from 0.43x in
FY18
The Company is reporting results of its subsidiaries by applying
International Accounting Standards 29 – IAS 29 (Financial Reporting
in Hyperinflationary Economies) (“IAS 29”), and certain financial
figures1 Table 1b and Table 11 below were prepared in U.S. dollars
and Pesos without giving effect to IAS 29.
Commenting on the financial and operating performance for the
second quarter of 2019, Sergio Faifman, Loma Negra’s Chief
Executive Officer, noted: “We are pleased to announce another
set of solid results, our business continues to deliver Adjusted
EBITDA margin expansion based on our constant focus in
profitability and cost enhancement initiatives. In this sense,
during this quarter we adjusted our production-footprint by
reconverting Barker facility to a grinding and distribution center,
this initiative will let us be a more efficient and agile
company.
Considering the Argentine context, our business continues to
deliver both Adjusted EBITDA margin expansion and Net income
growth.
Throughout the second quarter cement demand in Argentina
declined, although in a sequential basis it remained flat.
Recently, cement demand showed a couple of months with growth in a
year on year basis. We are optimistic and expect this trend to
continue.
Our expansion project in L´Amalí continues as schedule to kick
in 2Q20.”
1) Table 1b and Table 11-- Figures in US dollars result from the
calculation of figures expressed in Argentine pesos and the average
exchange rate for each reporting period (2019 figures exclude the
impact of IAS 29 and 2018 figures are as previously reported)
Table 1: Financial Highlights (amounts expressed in millions
of pesos, unless otherwise noted)
Three-months endedJune 30,
Six-months endedJune 30,
2019
2018
% Chg.
2019
2018
% Chg.
Net revenue
7,470
7,637
-2.2%
15,615
15,495
0.8%
Gross Profit
1,917
2,015
-4.9%
4,266
3,840
11.1%
Gross Profit margin
25.7%
26.4%
-72 bps
27.3%
24.8%
+253 bps Adjusted EBITDA
1,929
1,801
7.1%
4,268
3,785
12.8%
Adjusted EBITDA Mg.
25.8%
23.6%
+225 bps
27.3%
24.4%
+291 bps Net Profit
1,100
176
525.4%
2,268
967
134.5%
Net Profit attributable to owners of the Company
1,065
170
525.3%
2,175
905
140.4%
EPS
1.7870
0.2858
525.3%
3.6498
1.5183
140.4%
Shares outstanding at eop
596
596
0.0%
596
596
0.0%
Net Debt
6,967
5,874
18.6%
6,967
5,874
18.6%
Net Debt /LTM Adjusted EBITDA
0.76x
0.62x
0.14x
0.76x
0.62x
0.14x
Table 1b: Financial Highlights in Ps and in U.S. dollars (2019
figures exclude the impact of IAS 29 and 2018 figures are as
previously reported) In million Ps. Three-months
endedJune 30, Six-months endedJune 30,
2019
2018
% Chg.
2019
2018
% Chg.
Net revenue
7,262
4,757
52.7%
14,395
9,291
54.9%
Adjusted EBITDA
1,958
1,153
69.8%
4,076
2,319
75.7%
Adjusted EBITDA Mg.
27.0%
24.2%
+272 bps
28.3%
25.0%
+335 bps Net Profit
710
178
299.7%
1,736
727
138.9%
Net Debt
6,967
3,772
84.7%
6,967
3,772
84.7%
Net Debt /LTM Adjusted EBITDA 0.76x 0.62x 0.14x 0.76x 0.62x 0.14x
In million US$ Three-months endedJune 30,
Six-months endedJune 30,
2019
2018
% Chg.
2019
2018
% Chg.
Ps./US$, av
44.04
23.54
87.1%
41.46
21.61
91.9%
Ps./US$, eop
42.45
28.86
47.1%
42.45
28.86
47.1%
Net revenue
165
202
-18.4%
347
430
-19.3%
Adjusted EBITDA
44
49
-9.2%
98
107
-8.4%
Adjusted EBITDA Mg.
27.0%
24.2%
+272 bps
28.3%
25.0%
+335 bps Net Profit
16
8
113.6%
42
34
24.5%
Net Debt
164
131
25.6%
164
131
25.6%
Net Debt /LTM Adjusted EBITDA 0.76x 0.62x 0.14x 0.76x 0.62x 0.14x
Overview of Operations
Sales Volumes
Table 2: Sales Volumes2 Three-months endedJune
30, Six-months endedJune 30,
2019
2018
% Chg.
2019
2018
% Chg.
Cement, masonry & lime Argentina MM Tn
1.33
1.49
-10.4%
2.70
3.07
-12.0%
Paraguay MM Tn
0.12
0.13
-1.2%
0.28
0.27
3.5%
Cement, masonry & lime total
1.46
1.61
-9.7%
2.98
3.34
-10.7%
Argentina: Concrete MM m3
0.22
0.25
-12.8%
0.47
0.50
-5.5%
Railroad MM Tn
1.13
1.16
-2.4%
2.23
2.32
-3.9%
Aggregates MM Tn
0.30
0.25
18.5%
0.59
0.54
8.3%
2 Sales volumes include inter-segment sales
Sales volumes of cement, masonry and lime in Argentina during
2Q19 declined by 10.4% YoY to 1.33 million tons. As in previous
quarters, the bag segment continued to suffer further than the bulk
segment, which was supported by an incipient recovery in the
private sector.
In Paraguay, sales volumes decreased by 1.2% YoY in the second
quarter to 0.12 million tons mostly explained by adverse weather
conditions, partially offset by a higher market participation. As a
result, consolidated total sales volumes of cement, masonry and
lime for the quarter decreased 9.7% YoY to 1.46 million tons.
Sales volumes in the Concrete segment in Argentina were down
12.8% YoY to 0.22 million m3, given several large infrastructure
projects that had commenced in recent years were in completion
phase. During this year, other new large projects did not ramp-up
yet.
Railroad segment volumes experienced a 2.4% decline versus the
comparable quarter in 2018, affected by lower transported cement.
By contrast, Aggregate volumes in 2Q19 increased by 18.5% YoY or
0.30 million tons.
Review of Financial Results
Following the categorization of Argentina as a country with a
three-year cumulative inflation rate greater than 100%, the country
is considered highly inflationary in accordance with IFRS.
Consequently, starting July 1, 2018, the Company is reporting
results applying IFRS rule IAS 29. IAS 29 requires that results of
operations in hyperinflationary economies are reported as if these
economies were highly inflationary as of January 1, 2018, and thus
year-to-date, together with comparable results, should be restated
adjusting for the change in general purchasing power of the local
currency, using official indices.
Table 3: Consolidated Statement of Financial Position
(amounts expressed in millions of pesos, unless otherwise noted)
Three-months endedJune 30, Six-months endedJune 30,
2019
2018
% Chg.
2019
2018
% Chg.
Net revenue
7,470
7,637
-2.2%
15,615
15,495
0.8%
Cost of sales
(5,553)
(5,622)
-1.2%
(11,349)
(11,654)
-2.6%
Gross Profit
1,917
2,015
-4.9%
4,266
3,840
11.1%
Selling and administrative expenses
(486)
(579)
-16.1%
(1,172)
(1,182)
-0.9%
Other gains and losses
(12)
(12)
-3.7%
(14)
(6)
134.7%
Tax on debits and credits to bank accounts
(40)
(50)
-19.6%
(162)
(162)
-0.1%
Finance costs, net Exchange rate differences
290
(669)
n/a
114
(744)
n/a
Financial income
-
2
n/a
10
2
504.7%
Financial expenses
(375)
(198)
89.5%
(579)
(353)
64.2%
Gain on net monetary position
349
(89)
n/a
572
62
827.7%
Profit before taxes
1,642
419
292.1%
3,034
1,456
108.4%
Income tax expense Current
(335)
0
n/a
(709)
(345)
105.6%
Deferred
(208)
(243)
-14.6%
(56)
(144)
-60.8%
Net profit
1,100
176
525.4%
2,268
967
134.5%
Net majority income
1,065
170
525.3%
2,175
905
140.4%
Net Revenues
Net revenue decreased 2.2% to Ps. 7,470 million in 2Q19,
from Ps. 7,637 million in the comparable quarter last year, mainly
due to a decline in Concrete revenues, which was partially
compensated by a positive price dynamic of Cement in Argentina and
Paraguay.
Revenues in Cement, masonry and lime in Argentina remained
almost flat, 0.3% YoY, as a result of the volume drop that was not
fully compensated by a favorable price environment. Cement revenues
in Paraguay improved 11.0% YoY, positively impacted by the
Paraguayan Guarani appreciation against the Argentine peso.
Concrete segment presented a decline in both sales volumes and
prices when compared to the strong 2Q in the year ago period,
resulting in revenues dropping 17.6% YoY. Railroad revenues
decreased 6.5% YoY, as price decreased in real term and sales
volume declined 2.4%. By contrast, Aggregate revenues were up 24.6%
YoY during the period, driven by improving volume and prices.
Cost of sales, and Gross profit
Cost of sales decreased 1.2% YoY reaching Ps.5,553
million in 2Q19 mainly as a result of the lower volume sold and by
unitary energy costs trending downwards measured in US dollars.
During the quarter, there were approximately Ps.188 million of
non-recurrent costs related to the adjustment of our
production-footprint by reconverting Barker facility to a grinding
and distribution center.
Gross profit declined 4.9% YoY to Ps.1,917 million in
2Q19 from Ps.2,015 million in 2Q18, with gross profit margin
contracting 72 basis points YoY to 25.7%. Excluding the
non-recurrent costs associated to the production-footprint
adequacy, gross profit margin would have expanded by 179 basis
points to 28.2%.
Selling and Administrative Expenses
Selling and administrative expenses (SG&A) in 2Q19
decreased 16.1% YoY to Ps.486 million, from Ps.579 million in 2Q18.
As a percentage of revenues, SG&A decreased 108 basis points to
6.5% in 2Q19, from 7.6% in 2Q18 positively impacted by structure
adequacy measures adopted in 1Q19 coupled with a further reduction
in the effective sales tax rate.
Adjusted EBITDA & Margin
Table 4: Adjusted EBITDA Reconciliation & Margin
(amounts expressed in millions of pesos, unless otherwise noted)
Three-months endedJune 30, Six-months endedJune 30,
2019
2018
% Chg.
2019
2018
% Chg.
Adjusted EBITDA reconciliation: Net profit
1,100
176
525.4%
2,268
967
134.5%
(+) Depreciation and amortization
510
378
35.2%
1,188
1,133
4.9%
(+) Tax on debits and credits to bank accounts
40
50
-19.6%
162
162
-0.1%
(+) Income tax expense
543
243
123.2%
766
489
56.6%
(+) Financial interest, net
324
149
118.1%
487
281
73.2%
(+) Exchange rate differences, net
(290)
669
n/a
(114)
744
n/a
(+) Other financial expenses, net
52
47
9.3%
82
70
17.2%
(+) Gain on net monetary position
(349)
89
n/a
(572)
(62)
827.7%
Adjusted EBITDA
1,929
1,801
7.1%
4,268
3,785
12.8%
Adjusted EBITDA Margin
25.8%
23.6%
+225 bps
27.3%
24.4%
+291 bps
Adjusted EBITDA increased 7.1% YoY in the second quarter
of 2019 to Ps.1,929 million, with Adjusted EBITDA margin expanding
225 basis points to 25.8% compared to 23.6% in 2Q18.
Excluding the application of IAS 29, as shown on Table 1b,
Adjusted EBITDA increased 69.8% YoY in the second quarter of 2019,
reaching Ps.1,958 million, mainly driven by the Cement segments in
Argentina and Paraguay, with Adjusted EBITDA margin expanding 272
basis points to 27.0% compared to 24.2% in 2Q18. Excluding
non-recurrent costs from production-footprint adequacy, Adjusted
EBITDA would have reached Ps.2,144 million, with an EBITDA margin
of 29.5%.
Table 11, presenting financial Data by Segment (Excluding IAS
29), shows that Adjusted EBITDA for the Cement segment in Argentina
increased during the second quarter 62% YoY and the margin expanded
by 113 basis points to 29.2%. The Cement segment in Paraguay,
reported a 112% YoY increase in Adjusted EBITDA while Adjusted
EBITDA margin was 41.4%, expanding 745 basis points compared to the
same period one year ago.
In addition, the Concrete segment reported a decline in Adjusted
EBITDA reaching Ps.15.5 million, with the margin contraction of 186
basis points, from 3.4% to 1.5%, mainly as a result of a lower
sales volume and a more competitive price environment. Moreover,
Aggregates Adjusted EBITDA margin for the 2Q19 declined 164 bps
mostly explained by higher operational costs. By contrast, Railroad
segment improved almost Ps.75 million in the second quarter of
2019, and the Adjusted EBITDA margin expanded to 12.8% from 3.2% in
the comparable period in 2018, as a result of previous structure
adequacy efforts.
Finance Costs-Net
Table 5: Finance Costs, net (amounts expressed in millions
of pesos, unless otherwise noted)
Three-months endedJune 30,
Six-months endedJune 30,
2019
2018
% Chg.
2019
2018
% Chg. Exchange rate differences
290
(669)
n/a
114
(744)
n/a
Financial income
-
2
n/a
10
2
504.7%
Financial expenses
(375)
(198)
89.5%
(579)
(353)
64.2%
Gain on net monetary position
349
(89)
n/a
572
62
827.7%
Total Finance Costs, Net
264
(954)
n/a
117
(1,034)
n/a
During 2Q19, the Company reported a gain of Ps.264 million in
total finance costs-net compared to a loss of Ps.954 million in the
previous year second quarter, mainly due to a gain in both foreign
exchange differences and net monetary position as a consequence of
the exchange rate stability during the quarter.
Net Financial expense increased by Ps.180 million to Ps.375
million resulting from a higher gross debt position together with
higher interest rates.
Net Profit and Net Profit Attributable to Owners of the
Company
Net Profit for 2Q19, increased 525% to Ps.1,100 million
from Ps.176 million in the corresponding quarter of the previous
year.
Net Profit Attributable to Owners of the Company
increased 525% YoY, or Ps.895 million, to Ps.1,065 million in 2Q19.
During the quarter, the Company reported earnings per common share
of Ps.1.7870 and earnings per ADR of Ps.8.9349, compared with
earnings per common share of Ps.0.2858 and earnings per ADR of
Ps.1.4288 in 2Q18.
Capitalization
Table 6: Capitalization and Debt Ratio (amounts expressed in
millions of pesos, unless otherwise noted)
As of June 30,
As of December, 31
2019
2018
2018
Total Debt
8,136
8,394
7,299
- Short-Term Debt
4,578
4,473
4,107
- Long-Term Debt
3,558
3,921
3,192
Cash and Cash Equivalents
1,170
2,520
3,552
Total Net Debt
6,967
5,874
3,747
Shareholders' Equity
22,250
18,822
20,262
Capitalization
30,387
27,216
27,561
LTM Adjusted EBITDA
9,199
9,466
8,716
Net Debt /LTM Adjusted EBITDA 0.76x 0.62x 0.43x
As of June 30, 2019, total cash and cash equivalents were
Ps.1,170 million compared with Ps.2,520 million as of the December
31, 2018 mainly due to increased capex investments. Total debt at
the close of the quarter stood at Ps.8,136 million, composed by
Ps.4,578 million in short-term borrowings, including the current
portion of long-term borrowings (or 56% of total borrowings), and
Ps.3,558 million in long-term borrowings (or 44% of total
borrowings).
As of June 30, 2019, 35% (or Ps.2,858 million) Loma Negra’s
total debt was denominated in U.S. dollars, 33% (or Ps.2,651
million) in Guaraníes, 30% (or Ps.2,464 million) in Argentine
pesos, and 2% (or Ps.163 million) in Euros. The average duration of
Loma Negra’s total debt was 1.4 years.
As of June 30, 2019, Ps.5,322 million, or 65%, of the Company’s
total consolidated borrowings bore interest at floating rates,
including Ps.798 million of Peso-denominated borrowings that bore
interest at rates based on the Buenos Aires Deposits of Large
Amount Rate, or BADLAR, Ps.2,858 million of foreign
currency-denominated borrowings that bore interest at rates based
on Libor, and Ps.2,463 million of borrowings with other floating
interest rate.
The Net Debt to Adjusted EBITDA (LTM) ratio increased to 0.76x
as of June 30, 2019 from 0.62x as of June 30, 2018 reflecting the
use of funds in investing activities.
Cash Flows
Table 7: Condensed Interim Consolidated Statement of Cash Flows
for the Six-months and Three-months ended June 30, 2019 and
2018 (amounts expressed in millions of pesos, unless otherwise
noted)
Three-months
ended June 30,
Six-months ended June
30,
2019
2018
2019
2018
CASH FLOWS FROM OPERATING ACTIVITIES Net profit for the
period
1,100
176
2,268
967
Adjustments to reconcile net profit to net cash provided by
operating activities
755
1,223
2,028
2,253
Changes in operating assets and liabilities
(868)
(1,562)
(2,700)
(3,476)
Net cash generated / used in by operating activities
986
(164)
1,597
(256)
CASH FLOWS FROM INVESTING ACTIVITIES Property, plant
and equipment, Intangible Assets, net
(2,657)
(702)
(4,724)
(2,229)
Others
(5)
(17)
(23)
(32)
Net cash used in investing activities
(2,662)
(719)
(4,748)
(2,261)
CASH FLOWS FROM FINANCING ACTIVITIES Proceeds /
Repayments from borrowings, Interest paid
1,421
(1,018)
959
(1,288)
Net cash generated / used in by financing activities
1,421
(1,018)
959
(1,288)
Net decrease in cash and cash equivalents
(255)
(1,901)
(2,192)
(3,804)
Cash and cash equivalents at the beginning of the year
1,639
3,887
3,552
5,746
Effect of the re-expression in homogeneous cash currency
("Inflation-Adjusted")
(38)
(23)
(64)
(42)
Effects of the exchange rate differences on cash and cash
equivalents in foreign currency
(177)
557
(127)
620
Cash and cash equivalents at the end of the period
1,170
2,520
1,170
2,520
In the 2Q19, cash flow generated by operating activities was
Ps.986 million compared to negative Ps.164 million in 2Q18,
explained mainly by a higher profitability during the period and
lower working capital needs. During 2Q19, the Company made capital
expenditures for a total of Ps.2,685 million, mostly allocated to
the expansion of production capacity of L’Amalí plant.
Expansion of L’Amalí Plant.
Loma Negra is moving ahead with the capital expenditure at its
L’Amalí plant, which will add 2.7 million tons annually and drive
higher profitability. This expansion involves a total capital
expenditure, originally estimated at approximately US$350 million.
Start-up date is projected for the second quarter of next year.
The Company continued with the overall project execution during
the quarter. Main equipment and materials are already manufactured
in China and Europe and are under the delivery-to-site process. In
addition, the supply of local steel structures is in progress, and
deliveries are in line with construction needs. Electromechanical
first stage of kiln erection is completed, works of preassembly and
erection are progressing. Civil works for main foundations, silos
and buildings structures presents a good degree of advancement.
Additions to Property, Plant and Equipment related to this project
during 2Q19 amounted to approximately Ps.2,279 million.
2Q19 Earnings Conference
Call
When:
10:00 a.m. U.S. ET (11:00 a.m. BAT),
August 9, 2019
Dial-in:
0800-444-2930 (Argentina), 1-833-255-2824
(U.S.), 1-866-605-3852 (Canada), 1-412-902-6701 (International)
Password:
Loma Negra Earnings Call
Webcast:
https://services.choruscall.com/links/loma190809XbG9DTqf.html
Replay:
A telephone replay of the conference call
will be available between August 9, 2019 at 1:00 pm U.S. E.T. and
ending on August 16, 2019. The replay can be accessed by dialing
1-877-344-7529 (U.S. toll free), or 1-412-317-0088 (International).
The passcode for the replay is 10133208. The audio of the
conference call will also be archived on the Company’s website at
www.lomanegra.com
Definitions
Adjusted EBITDA is calculated as net profit plus
financial interest, net plus income tax expense plus depreciation
and amortization plus exchange rate differences plus other
financial expenses, net plus tax on debits and credits to bank
accounts. Loma Negra believes that excluding tax on debits and
credits to bank accounts from its calculation of Adjusted EBITDA is
a better measure of operating performance when compared to other
international players.
Net Debt is calculated as borrowings less cash and cash
equivalents.
About Loma Negra
Founded in 1926, Loma Negra is the leading cement company in
Argentina, producing and distributing cement, masonry cement,
aggregates, concrete and lime, products primarily used in private
and public construction. Loma Negra is a vertically-integrated
cement and concrete company, with nationwide operations, supported
by vast limestone reserves, strategically located plants,
top-of-mind brands and established distribution channels. The
Company also owns a 51% equity stake in an integrated cement
production plant in Paraguay, which is one of two leading cement
producers in that country. Loma Negra is listed both on BYMA and on
NYSE in the U.S., where it trades under the symbol “LOMA”. One ADS
represents five (5) common shares. For more information, visit
www.lomanegra.com.
Note
The Company presented some figures converted from Pesos to U.S.
dollars for comparison purposes. The exchange rate used to convert
Pesos to U.S. dollars was the reference exchange rate
(Communication “A” 3500) reported by the Central Bank for U.S.
dollars. The information presented in U.S. dollars is for the
convenience of the reader only. Certain figures included in this
report have been subject to rounding adjustments. Accordingly,
figures shown as totals in certain tables may not be arithmetic
aggregations of the figures presented in previous quarters.
Rounding: We have made rounding adjustments to reach some of the
figures included in this annual report. As a result, numerical
figures shown as totals in some tables may not be an arithmetic
aggregation of the figures that preceded them.
Disclaimer
This release contains
forward-looking statements within the meaning of federal securities
law that are subject to risks and uncertainties. These statements
are only predictions based upon our current expectations and
projections about possible or assumed future results of our
business, financial condition, results of operations, liquidity,
plans and objectives. In some cases, you can identify
forward-looking statements by terminology such as “believe,” “may,”
“estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,”
“expect,” “predict,” “potential,” “seek,” “forecast,” or the
negative of these terms or other similar expressions. The
forward-looking statements are based on the information currently
available to us. There are important factors that could cause our
actual results, level of activity, performance or achievements to
differ materially from the results, level of activity, performance
or achievements expressed or implied by the forward-looking
statements, including, among others things: changes in general
economic, political, governmental and business conditions globally
and in Argentina, changes in inflation rates, fluctuations in the
exchange rate of the peso, the level of construction generally,
changes in cement demand and prices, changes in raw material and
energy prices, changes in business strategy and various other
factors. You should not rely upon forward-looking statements as
predictions of future events. Although we believe in good faith
that the expectations reflected in the forward-looking statements
are reasonable, we cannot guarantee that future results, levels of
activity, performance and events and circumstances reflected in the
forward-looking statements will be achieved or will occur. Any or
all of Loma Negra’s forward-looking statements in this release may
turn out to be wrong. You should consider these forward-looking
statements in light of other factors discussed under the heading
“Risk Factors” in the prospectus filed with the Securities and
Exchange Commission on October 31, 2017 in connection with Loma
Negra’s initial public offering. Therefore, readers are cautioned
not to place undue reliance on these forward-looking statements.
Except as required by law, we undertake no obligation to update
publicly any forward-looking statements for any reason after the
date of this release to conform these statements to actual results
or to changes in our expectations.
Table 8: Condensed Interim Consolidated Statements of Financial
Position as of June 30, 2019 and December 31, 2018 (amounts
expressed in millions of pesos, unless otherwise noted)
As of
June 30, As of December 31,
2019
2018
ASSETS Non-current assets Property, plant and
equipment
31,453
26,780
Intangible assets
272
267
Investments
2
2
Goodwill
20
20
Inventories
801
829
Other receivables
839
1,153
Right to use assets
333
-
Trade accounts receivable
4
5
Total non-current assets
33,725
29,057
Current assets Inventories
5,386
4,624
Other receivables
585
469
Trade accounts receivable
2,624
2,527
Investments
89
2,565
Cash and banks
1,081
987
Total current assets
9,765
11,173
TOTAL ASSETS
43,489
40,229
SHAREHOLDERS' EQUITY Capital stock and other capital related
accounts
8,796
8,796
Reserves
9,448
2,791
Retained earnings
2,175
6,656
Accumulated other comprehensive income
193
336
Equity attributable to the owners of the Company
20,612
18,579
Non-controlling interests
1,638
1,683
TOTAL SHAREHOLDERS' EQUITY
22,250
20,262
LIABILITIES Non-current liabilities Borrowings
3,558
3,192
Accounts payables
1,037
474
Provisions
346
358
Other liabilities
39
10
Debts for leases
257
-
Deferred tax liabilities
3,954
3,900
Total non-current liabilities
9,191
7,933
Current liabilities Borrowings
4,578
4,107
Accounts payable
5,827
5,941
Advances from customers
148
206
Salaries and social security payables
694
776
Tax liabilities
672
954
Debts for leases
63
-
Other liabilities
65
50
Total current liabilities
12,047
12,034
TOTAL LIABILITIES
21,239
19,967
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES
43,489
40,229
Table 9: Condensed Interim Consolidated Statements of Profit or
Loss and Other Comprehensive Income (unaudited) (amounts
expressed in millions of pesos, unless otherwise noted)
Three-months endedJune 30, Six-months endedJune 30,
2019
2018
% Change
2019
2018
% Change
Net revenue
7,470
7,637
-2.2%
15,615
15,495
0.8%
Cost of sales
(5,553)
(5,622)
-1.2%
(11,349)
(11,654)
-2.6%
Gross profit
1,917
2,015
-4.9%
4,266
3,840
11.1%
Selling and administrative expenses
(486)
(579)
-16.1%
(1,172)
(1,182)
-0.9%
Other gains and losses
(12)
(12)
-3.7%
(14)
(6)
134.7%
Tax on debits and credits to bank accounts
(40)
(50)
-19.6%
(162)
(162)
-0.1%
Finance costs, net Exchange rate differences
290
(669)
n/a
114
(744)
n/a
Financial income
-
2
n/a
10
2
504.7%
Financial expenses
(375)
(198)
89.5%
(579)
(353)
64.2%
Gain on net monetary position
349
(89)
n/a
572
62
827.7%
Profit before taxes
1,642
419
292.1%
3,034
1,456
108.4%
Income tax expense Current
(335)
0
n/a
(709)
(345)
105.6%
Deferred
(208)
(243)
-14.6%
(56)
(144)
-60.8%
Net profit
1,100
176
525.4%
2,268
967
134.5%
Other Comprehensive Income Items to be reclassified
through profit and loss: Exchange differences on translating
foreign operations
(269)
546
n/a
(280)
557
n/a
Total other comprehensive (loss) income
(269)
546
n/a
(280)
557
n/a
TOTAL COMPREHENSIVE INCOME
830
722
15.0%
1,989
1,525
30.4%
Net Profit (loss) for the period attributable to: Owners of
the Company
1,065
170
525.3%
2,175
905
140.4%
Non-controlling interests
35
6
527.7%
93
62
49.6%
NET PROFIT FOR THE PERIOD
1,100
176
525.4%
2,268
967
134.5%
Total comprehensive income (loss) attributable to: Owners of
the Company
928
449
106.6%
2,033
1,189
70.9%
Non-controlling interests
(97)
273
n/a
(44)
335
n/a
TOTAL COMPREHENSIVE INCOME
830
722
15.0%
1,989
1,525
30.4%
Earnings per share (basic and diluted):
1.7870
0.2858
525.3%
3.6498
1.5183
140.4%
Table 10: Condensed Interim Consolidated Statement of Cash Flows
for the Six-months and Three-months ended June 30, 2019 and
2018 (amounts expressed in millions of pesos, unless otherwise
noted)
Three-months endedJune 30, Six-months endedJune
30,
2019
2018
2019
2018
CASH FLOWS FROM OPERATING ACTIVITIES Net profit for the
period
1,100
176
2,268
967
Adjustments to reconcile net profit to net cash provided by
operating activities Income tax expense
543
243
766
489
Depreciation and amortization
510
378
1,188
1,133
Provisions
56
41
73
53
Interest expense
(120)
170
194
241
Exchange rate differences
(245)
399
(196)
338
Others
11
(8)
3
(1)
Gain on disposal of Property, plant and equipment
(0)
-
(0)
-
Changes in operating assets and liabilities Inventories
(141)
(631)
(754)
(1,008)
Other receivables
66
(7)
(12)
(191)
Trade accounts receivable
100
(58)
(531)
(521)
Advances from customers
(32)
5
(32)
(105)
Accounts payable
(48)
26
(142)
(510)
Debts for leases
(13)
-
(33)
-
Salaries and social security payables
17
(221)
62
(181)
Provisions
(36)
(33)
(83)
(41)
Tax liabilities
(176)
13
(292)
(1)
Other liabilities
15
(25)
201
(32)
Income tax paid
(358)
(558)
(513)
(690)
Gain on net monetary position
(263)
(74)
(572)
(198)
Net cash generated / used in by operating activities
986
(164)
1,597
(256)
CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from
disposal of Property, plant and equipment
1
3
8
6
Payments to acquire Property, plant and equipment
(2,640)
(702)
(4,713)
(2,230)
Payments to acquire Intangible Assets
(19)
(3)
(20)
(6)
Contributions to Trust
(5)
(17)
(23)
(32)
Net cash used in investing activities
(2,662)
(719)
(4,748)
(2,261)
CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from
borrowings
2,781
380
3,053
695
Interest paid
(391)
(232)
(672)
(505)
Repayment of borrowings
(969)
(1,166)
(1,422)
(1,478)
Net cash generated / used in by financing activities
1,421
(1,018)
959
(1,288)
Net decrease in cash and cash equivalents
(254)
(1,901)
(2,191)
(3,804)
Cash and cash equivalents at the beginning of the period
1,639
3,887
3,552
5,746
Effect of the re-expression in homogeneous cash currency
("Inflation-Adjusted")
(38)
(23)
(64)
(42)
Effects of the exchange rate differences on cash and cash
equivalents in foreign currency
(177)
557
(127)
620
Cash and cash equivalents at the end of the period
1,170
2,520
1,170
2,520
Table 11: Financial Data by Segment (2019 figures exclude the
impact of IAS 29 and 2018 figures are as previously reported)
(amounts expressed in millions of pesos, unless otherwise noted)
Three-months ended June 30, Six-months ended June 30,
2019
%
2018
%
2019
%
2018
%
Net revenue
7,262
100.0%
4,757
100.0%
14,395
100.0%
9,291
100.0%
Cement, masonry cement and lime—Argentina
5,453
75.1%
3,503
73.6%
10,625
73.8%
6,903
74.3%
Cement—Paraguay
641
8.8%
369
7.8%
1,343
9.3%
715
7.7%
Concrete
1,014
14.0%
790
16.6%
2,200
15.3%
1,497
16.1%
Railroad
708
9.8%
485
10.2%
1,365
9.5%
926
10.0%
Aggregates
134
1.8%
69
1.4%
259
1.8%
137
1.5%
Others
35
0.5%
28
0.6%
66
0.5%
53
0.6%
Eliminations
(721)
-9.9%
(487)
-10.2%
(1,463)
-10.2%
(939)
-10.1%
Cost of sales
5,151
100.0%
3,426
100.0%
9,936
100.0%
6,659
100.0%
Cement, masonry cement and lime—Argentina
3,658
71.0%
2,332
68.1%
6,909
69.5%
4,610
69.2%
Cement—Paraguay
466
9.0%
284
8.3%
937
9.4%
521
7.8%
Concrete
981
19.0%
744
21.7%
2,043
20.6%
1,420
21.3%
Railroad
607
11.8%
466
13.6%
1,193
12.0%
880
13.2%
Aggregates
140
2.7%
71
2.1%
276
2.8%
138
2.1%
Others
23
0.4%
15
0.5%
41
0.4%
29
0.4%
Eliminations
(721)
-14.0%
(487)
-14.2%
(1,463)
-14.7%
(939)
-14.1%
Selling, admin. expenses and other gains & losses
497
100.0%
373
100.0%
1,068
100.0%
696
100.0%
Cement, masonry cement and lime—Argentina
379
76.2%
283
76.0%
834
78.1%
527
75.7%
Cement—Paraguay
15
3.1%
16
4.3%
38
3.6%
29
4.2%
Concrete
34
6.9%
27
7.2%
69
6.5%
51
7.3%
Railroad
53
10.7%
36
9.7%
98
9.2%
68
9.8%
Aggregates
2
0.3%
1
0.4%
4
0.3%
3
0.4%
Others
13
2.7%
9
2.5%
25
2.3%
18
2.6%
Depreciation and amortization
343
100.0%
195
100.0%
685
100.0%
384
100.0%
Cement, masonry cement and lime—Argentina
174
50.6%
94
48.3%
353
51.5%
191
49.8%
Cement—Paraguay
106
30.8%
56
28.8%
211
30.8%
111
28.8%
Concrete
16
4.7%
8
4.0%
27
3.9%
16
4.0%
Railroad
42
12.3%
33
17.0%
84
12.2%
60
15.7%
Aggregates
5
1.4%
3
1.6%
9
1.3%
5
1.3%
Others
1
0.2%
1
0.3%
2
0.2%
1
0.3%
Adjusted EBITDA
1,958
100.0%
1,153
100.0%
4,076
100.0%
2,319
100.0%
Cement, masonry cement and lime—Argentina
1,590
81.2%
982
85.2%
3,234
79.3%
1,957
84.4%
Cement—Paraguay
265
13.5%
125
10.9%
579
14.2%
275
11.9%
Concrete
16
0.8%
27
2.3%
114
2.8%
42
1.8%
Railroad
90
4.6%
16
1.4%
157
3.8%
37
1.6%
Aggregates
(3)
-0.2%
(0)
0.0%
(11)
-0.3%
1
0.0%
Others
(1)
0.0%
4
0.3%
3
0.1%
7
0.3%
Reconciling items: Effect by translation in homogeneous cash
currency ("Inflation-Adjusted")
(29)
647
192
1,465
Depreciation and amortization
(510)
(378)
(1,188)
(1,133)
Tax on debits and credits banks accounts
(40)
(50)
(162)
(162)
Finance costs, net
264
(954)
117
(1,034)
Income tax
(543)
(243)
(766)
(489)
NET PROFIT FOR THE PERIOD
1,100
176
2,268
967
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190808005903/en/
IR Contacts Marcos I. Gradin, Chief Financial Officer and
Investor Relations Gastón Pinnel, Investor Relations Manager
+54-11-4319-3050 investorrelations@lomanegra.com
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