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 twelve-month period ended
December 31, 2019 (our “4Q19 and FY19 Results”).
4Q19 Key Highlights
- Net revenue decreased 15.0% YoY to Ps.9,074 million (US$147
million)
- Consolidated Adjusted EBITDA down 13.1% YoY to Ps.2,887 million
(US$49 million), as Argentina business was impacted by persistent
macro-economic instability amid the political transition
- Consolidated Adjusted EBITDA margin expanded by 69 basis points
YoY from 31.1% to 31.8%
- Net Debt /LTM Adjusted EBITDA ratio of 0.86x from 0.43x in
FY18
FY19 Key Highlights
- Net revenue down 5.5% YoY to Ps.38,952 million (US$660 million)
mainly affected by a lower activity level in Argentina
- Consolidated Adjusted EBITDA up 2.3% YoY to Ps.11,206 million
(US$199 million) and EBITDA margin expanding 221 bps up to 28.8%.
If excluding non-Recurrent cost from structure adequacy efforts,
FY19 EBITDA would have been around US$209 million, with EBITDA
margin of 31.6%
The Company is reporting results of its subsidiaries by applying
International Accounting Standards 29 – IAS 29 (Financial Reporting
in Hyperinflationary Economies) (“IAS 29”), and certain financial
figures1 Table 1b and Table 11 below were prepared in U.S. dollars
and Pesos without giving effect to IAS 29.
Commenting on the financial and operating performance for the
fourth quarter of 2019, Sergio Faifman, Loma Negra’s Chief
Executive Officer, noted: ”Since the October presidential
elections, the outgoing government had to take some measures to
recover the stability of the financial system. These measures ended
up deepening the ongoing economic and financial crisis. By the end
of the year, the incoming government took steps to achieve an
economic recovery, reschedule sovereign debt maturities and regain
confidence.
In this context, Argentina´s business suffered more than
previously expected, however, thanks to the determination to carry
out cost-control initiatives oriented towards streamlining our
production footprint, we were able to thrive and present results
that we can feel proud of. When excluding the non-recurrent costs
relative to this initiatives, Adjusted EBITDA would have reached
US$ 209 million with margins expanding 378 basis points to
31.6%.
Besides the global uncertainty observed these days,
domestically, a key aspect for 2020 will be the policies adopted by
the new administration in order to reestablish financial stability
and economic growth.
Our expansion project in L´Amalí continues as schedule to kick
in by mid-2020.”
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 ended December
31,
Twelve-months ended December
31,
2019
2018
% Chg.
2019
2018
% Chg.
Net revenue
9,074
10,669
-15.0%
38,952
41,238
-5.5%
Gross Profit
2,725
3,131
-13.0%
10,810
10,498
3.0%
Gross Profit margin
30.0%
29.3%
+68bps
27.8%
25.5%
+230bps
Adjusted EBITDA
2,887
3,321
-13.1%
11,206
10,954
2.3%
Adjusted EBITDA Mg.
31.8%
31.1%
+69bps
28.8%
26.6%
+221bps
Net Profit
1,126
1,946
-42.2%
4,044
3,001
34.8%
Net Profit attributable to owners
of the Company
1,050
1,835
-42.8%
3,839
2,769
38.7%
EPS
1.7611
3.0791
-42.8%
6.4413
4.6454
38.7%
Shares outstanding at eop
596
596
0.0%
596
596
0.0%
Net Debt
9,659
4,709
105.1%
9,659
4,709
105.1%
Net Debt /LTM Adjusted EBITDA
0.86x
0.43x
0.43x
0.86x
0.43x
0.43x
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 ended December
31,
Twelve-months ended December
31,
2019
2018
% Chg.
2019
2018
% Chg.
Net revenue
8,713
6,741
29.3%
31,828
22,163
43.6%
Adjusted EBITDA
2,907
2,149
35.3%
9,599
6,167
55.6%
Adjusted EBITDA Mg.
33.4%
31.9%
+149bps
30.2%
27.8%
+233bps
Net Profit
972
1,325
-26.6%
2,378
2,170
9.6%
Net Debt
9,659
4,573
111.2%
9,659
4,573
111.2%
Net Debt /LTM Adjusted EBITDA
0.86x
0.43x
0.43x
0.86x
0.43x
0.43x
In million US$
Three-months ended December
31,
Twelve-months ended December
31,
2019
2018
%Chg.
2019
2018
%Chg.
Ps./US$, av
59.34
37.14
59.8%
48.24
28.09
71.7%
Ps./US$, eop
59.90
37.81
58.4%
59.90
37.81
58.4%
Net revenue
147
182
-19.1%
660
789
-16.4%
Adjusted EBITDA
49
58
-15.3%
199
220
-9.4%
Adjusted EBITDA Mg.
33.4%
31.9%
+149bps
30.2%
27.8%
+233bps
Net Profit
16
36
-54.1%
49
77
-36.2%
Net Debt
161
121
33.3%
161
121
33.3%
Net Debt /LTM Adjusted EBITDA
0.86x
0.43x
0.43x
0.86x
0.43x
0.43x
Overview of Operations
Sales Volumes
Table 2: Sales
Volumes2
Three-months ended December
31,
Twelve-months ended December
31,
2019
2018
% Chg.
2019
2018
% Chg.
Cement, masonry &
lime
Argentina
MM Tn
1.28
1.44
-11.1%
5.47
6.12
-10.6%
Paraguay
MM Tn
0.14
0.15
-3.8%
0.57
0.57
0.4%
Cement, masonry & lime
total
1.42
1.58
-10.4%
6.04
6.68
-9.7%
Argentina:
Concrete
MM m3
0.13
0.27
-51.5%
0.80
1.07
-25.1%
Railroad
MM Tn
1.12
1.21
-7.5%
4.47
4.75
-5.8%
Aggregates
MM Tn
0.25
0.30
-18.6%
1.09
1.09
0.0%
2 Sales volumes include
inter-segment sales
Sales volumes of cement, masonry and lime in Argentina during
4Q19 declined by 11.1% YoY to 1.28 million tons, as demand was
affected by economic contraction and the political transition. In
contrast with previous quarters, but similarly to 3Q19, the bag
segment experienced a softer decline than the bulk segment.
In Paraguay, sales volumes decreased by 3.8% YoY in the fourth
quarter to 0.14 million tons, impacted by adverse weather
conditions. As a result, consolidated total sales volumes of
cement, masonry and lime for the quarter decreased 10.4% YoY to
1.42 million tons.
Sales volumes in the Concrete segment in Argentina were down
51.5% YoY to 0.13 million m3, as the major infrastructure public
works and private projects were put on hold.
Aggregate volumes in 4Q19 decreased by 18.6% YoY to 0.25 million
tons. In this line, the railway segment decreased 7.5% compared to
the same quarter in 2018, affected mostly by a lower transported
volume of building materials, and partially offset by a stronger
volume of other transported goods.
For FY19, Loma Negra reported a 9.7% YoY decline in total
Cement, masonry and lime sales volumes mainly reflecting overall
weak market demand in Argentina, while in Paraguay volumes remained
relatively flat. Concrete volumes experienced a 25% YoY decrease
compared to the record high level of 2018, reaching 0.8 MMm3, and
aggregates ended the year virtually without changes compared to FY
2018. Railroad segment volumes fell 5.8% in 2019 principally
reflecting the drop in building materials transportation.
Review of Financial Results
Table 3: Consolidated
Statement of Financial Position
(amounts expressed in millions of
pesos, unless otherwise noted)
Three-months ended December
31,
Twelve-months ended December
31,
2019
2018
% Chg.
2019
2018
% Chg.
Net revenue
9,074
10,669
-15.0%
38,952
41,238
-5.5%
Cost of sales
(6,349)
(7,538)
-15.8%
(28,142)
(30,740)
-8.5%
Gross Profit
2,725
3,131
-13.0%
10,810
10,498
3.0%
Selling and administrative
expenses
(756)
(734)
3.1%
(2,904)
(2,975)
-2.4%
Other gains and losses
31
140
-77.6%
37
168
-78.0%
Tax on debits and credits to bank
accounts
(100)
(86)
15.6%
(404)
(391)
3.3%
Finance costs, net
Exchange rate differences
353
488
-27.6%
(1,190)
(1,910)
-37.7%
Financial income
-
146
n/a
60
128
-52.9%
Financial expenses
(647)
(348)
85.8%
(1,793)
(1,104)
62.4%
Gain on net monetary position
89
64
38.0%
1,115
329
239.1%
Profit before taxes
1,696
2,802
-39.5%
5,730
4,742
20.8%
Income tax expense
Current
(360)
(801)
-55.1%
(1,103)
(1,614)
-31.7%
Deferred
(210)
(55)
285.1%
(583)
(127)
359.2%
Net profit
1,126
1,946
-42.2%
4,044
3,001
34.8%
Net majority income
1,050
1,835
-42.8%
3,839
2,769
38.7%
Net Revenues
Net revenue decreased 15.0% to Ps. 9,074 million in 4Q19,
from Ps. 10,669 million in the comparable quarter last year, mostly
due to the impact of lower revenues in the Concrete and Cement,
Masonry, and Lime segments in Argentina.
Revenues in Cement, masonry and lime in Argentina were down 9.1%
YoY, mainly as a result of the volume drop, partially offset by
positive pricing. Cement revenues in Paraguay decreased by 4.3%
YoY, mostly because of lower sales volume.
As a consequence of the suspension or postponement of large
public and private projects, Concrete and Aggregates segments
presented a sharp decline in sales volumes couple with softer
prices, which resulted in revenues dropping 55.5% and 35.1% YoY,
respectively. Railroad revenues decreased 15.5% YoY, as price
decreased in real term and sales volume declined 7.5%, impacted by
lower construction activity and partially offset by other
transported products.
For FY19, net revenues decreased 5.5% to Ps.38,952 million from
Ps. 41,238 in the FY18, mainly due to revenues decline in the
Concrete and Cement, masonry Cement, and lime segments in
Argentina.
Cost of sales, and Gross profit
Cost of sales declined 15.8% YoY reaching Ps. 6,349
million in 4Q19 mainly reflecting a lower volume of sales, better
energy cost, and the production-footprint adequacy efforts achieved
in the previous quarters.
Gross profit decreased 13.0% YoY to Ps. 2,725 million in
4Q19 from Ps. 3,131 million in 4Q18, with gross profit margin
expanding 68 basis points YoY to 30.0%.
During FY19, gross profit increased 3.0% to Ps.10,810 million
with gross profit margin expanding 230 basis points to 27.8%.
Selling and Administrative Expenses
Selling and administrative expenses (SG&A) in 4Q19
increased 3.1% YoY to Ps. 756 million, from Ps. 734 million in
4Q18. As a percentage of revenues, SG&A increased 146 basis
points to 8.3% in 4Q19, from 6.9% in 4Q18, mainly due to the lower
revenues level.
During FY19, SG&A fell 2.4% in absolute values from the
previous year levels, and as a percentage of sales stood at
7.5%.
Adjusted EBITDA & Margin
Table 4: Adjusted EBITDA
Reconciliation & Margin
(amounts expressed in millions of
pesos, unless otherwise noted)
Three-months ended December
31,
Twelve-months ended December
31,
2019
2018
% Chg.
2019
2018
% Chg.
Adjusted EBITDA
reconciliation:
Net profit
1,126
1,946
-42.2%
4,044
3,001
34.8%
(+) Depreciation and
amortization
887
783
13.3%
3,264
3,263
0.0%
(+) Tax on debits and credits to
bank accounts
100
86
15.6%
404
391
3.3%
(+) Income tax expense
570
856
-33.4%
1,686
1,741
-3.2%
(+) Financial interest, net
496
152
227.1%
1,444
781
84.8%
(+) Exchange rate differences,
net
(353)
(488)
-27.6%
1,190
1,910
-37.7%
(+) Other financial expenses,
net
151
50
201.2%
289
195
48.3%
(+) Gain on net monetary
position
(89)
(64)
38.0%
(1,115)
(329)
239.1%
Adjusted EBITDA
2,887
3,321
-13.1%
11,206
10,954
2.3%
Adjusted EBITDA Margin
31.8%
31.1%
+69bps
28.8%
26.6%
+221bps
Adjusted EBITDA decreased 13.1% YoY in the fourth quarter
of 2019 to Ps. 2,887 million, with Adjusted EBITDA margin expanding
69 basis points to 31.8% compared to 31.1% in 4Q18.
Excluding the application of IAS 29, as shown on Tables 1b,
Adjusted EBITDA increased 35.3% YoY in the fourth quarter of 2019,
reaching Ps. 2,907 million, mainly driven by the Cement segments in
Argentina and Paraguay, with Adjusted EBITDA margin expanding 149
basis points to 33.4% compared to 31.9% in 4Q18.
Table 11, presenting financial Data by Segment (Excluding IAS
29), shows that Adjusted EBITDA for the Cement, masonry cement and
lime segment in Argentina increased during the fourth quarter 43.6%
YoY and the margin expanded by 135 basis points to 36.0%. The
Cement segment in Paraguay, reported a 53.8% YoY increase in
Adjusted EBITDA while Adjusted EBITDA margin was 42.6%, expanding
228 basis points compared to the same period one year ago.
In addition, the Concrete segment reported a decrease in
Adjusted EBITDA reversing to a negative Ps. 27.3 million, with the
margin contracting from 5.8% to negative 3.6%, mainly as a result
of a sharp reduction in sales coupled with a softer pricing.
Moreover, Railroad segment declined 7.9% in the fourth quarter of
2019, and the Adjusted EBITDA margin contracted to 12.3% from 17.1%
in the comparable period in 2018, mainly as a result of a drop in
building materials transportation. Aggregates Adjusted EBITDA
margin for the 4Q19 stood at 4.4% mostly explained by a reduction
in demand.
During FY19, Adjusted EBITDA increased 2.3% reaching Ps.11,206
million from Ps.10,954 million in FY18, with an Adjusted EBITDA
margin expansion of 221 basis points, from 26.6% in 2018 to 28.8%
in 2019.
Finance Costs-Net
Table 5: Finance Costs,
net
(amounts expressed in millions of
pesos, unless otherwise noted)
Three-months ended December
31,
Twelve-months ended December
31,
2019
2018
% Chg.
2019
2018
% Chg.
Exchange rate differences
353
488
-27.6%
(1,190)
(1,910)
-37.7%
Financial income
-
146
n/a
60
128
-52.9%
Financial expenses
(647)
(348)
85.8%
(1,793)
(1,104)
62.4%
Gain on net monetary position
89
64
38.0%
1,115
329
239.1%
Total Finance Costs,
Net
(205)
351
n/a
(1,809)
(2,558)
-29.3%
During 4Q19, the company reported a loss of Ps. 205 million in
total finance costs-net compared to a gain of Ps. 351 million in
the previous year fourth quarter, mainly due to higher Financial
expenses as a result of higher interest rates and debt
position.
During FY19, total finance costs, net decreased Ps.749 million
to Ps. 1,809 million from Ps.2,558 million in FY18, mainly as a
result of a lower foreign exchange loss, a higher gain on net
monetary position, and partially compensated by a higher Financial
expenses due to higher interest rates and debt position.
Net Profit and Net Profit Attributable to Owners of the
Company
Net Profit for 4Q19, decreased to Ps. 1,126 million from
a gain of Ps.1,946 million in the corresponding quarter of the
previous year.
Net Profit Attributable to Owners of the Company declined
to Ps. 1,050 million in 4Q19 from Ps. 1,835 million in 4Q18. During
the last quarter, the Company reported earnings per common share of
Ps. 1.7611 and earnings per ADR of Ps. 8.8054 compared with a
earnings per common share of Ps. 3.0791 and earnings per ADR of Ps.
15.3954 in 4Q18.
During FY19, Net Profit attributable to owners of the Company
increased 38.7% YoY, to Ps.3,839 million, from Ps.2,769 million in
FY18.
Capitalization
Table 6: Capitalization and
Debt Ratio
(amounts expressed in millions of
pesos, unless otherwise noted)
As of December 31,
2019
2018
Total Debt
12,226
9,173
-Short - Term Debt
5,537
5,162
-Long - Term Debt
6,689
4,011
Cash and Cash Equivalents
2,567
4,464
Total Net Debt
9,659
4,709
Shareholders' Equity
29,328
25,464
Capitalization
41,553
34,637
LTM Adjusted EBITDA
11,206
10,954
Net Debt/LTM Adjusted EBITDA
0.86x
0.43x
As of December 31, 2019, total cash and cash equivalents were
Ps. 2,567 million compared with Ps. 4,464 million as of the
December 31, 2018 mainly due to increased capex investments. Total
debt at the close of the quarter stood at Ps. 12,226 million,
composed by Ps.5,537 million in short-term borrowings, including
the current portion of long-term borrowings (or 45% of total
borrowings), and Ps.6,689 million in long-term borrowings (or 55%
of total borrowings).
As of December 31, 2019, 43% (or Ps.5,274 million) Loma Negra’s
total debt was denominated in U.S. dollars, 26% (or Ps. 3,196
million) in Argentine pesos, 25% (or Ps.3,016 million) in
Guaraníes, and 6% (or Ps.740 million) in Euros. The average
duration of Loma Negra’s total debt was 1.5 years.
As of December 31, 2019, Ps.7,771 million, or 64%, of the
Company’s total consolidated borrowings bore interest at floating
rates, including Ps.4,575 million of foreign currency-denominated
borrowings that bore interest at rates based on Libor, and Ps.3,196
million of borrowings with other floating interest rate.
The Net Debt to Adjusted EBITDA (LTM) ratio increased to 0.86x
as of December 31, 2019 from 0.43x as of December 31, 2018
reflecting the use of funds in investing activities.
Cash Flows
Table 7: Condensed Interim
Consolidated Statement of Cash Flows for the Twelve-months and
Three-months ended December 31, 2019 and 2018
(amounts expressed in millions of
pesos, unless otherwise noted)
Three-months ended December
31,
Twelve-months ended December
31,
2019
2018
2019
2018
CASH FLOWS FROM OPERATING
ACTIVITIES
Net profit for the
period
1,126
1,946
4,044
3,001
Adjustments to reconcile net
profit to net cash provided by operating activities
698
(376)
5,836
5,988
Changes in operating assets and
liabilities
675
1,799
(1,338)
(2,560)
Net cash generated by operating
activities
2,498
3,369
8,542
6,428
CASH FLOWS FROM INVESTING
ACTIVITIES
Property, plant and equipment,
Intangible Assets, net
(2,388)
(2,958)
(11,805)
(6,427)
Others
21
(24)
(30)
(71)
Net cash used in investing
activities
(2,367)
(2,982)
(11,835)
(6,498)
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds / Repayments from
borrowings, Interest paid
783
(1,567)
1,415
(3,677)
Net cash generated by / used in
financing activities
783
(1,567)
1,415
(3,677)
Net increase / decrease in
cash and cash equivalents
914
(1,179)
(1,878)
(3,747)
Cash and cash equivalents at the
beginning of the year
1,512
4,735
4,464
7,222
Effect of the re-expression in
homogeneous cash currency ("Inflation-Adjusted")
(40)
(40)
(162)
(151)
Effects of the exchange rate
differences on cash and cash equivalents in foreign currency
181
948
143
1,139
Cash and cash equivalents at
the end of the period
2,567
4,464
2,567
4,464
In the 4Q19, cash flow generated by operating activities was
Ps.2,498 million compared to Ps.3,369 million in 4Q18, explained
mainly by a lower profitability during the period and higher
working capital needs. During 4Q19, the Company made capital
expenditures for a total of Ps.2,367 million, mostly allocated to
the expansion of production capacity of L’Amalí plant.
During FY19, the Company made capital expenditures for a total
of Ps.11,835 million, of which 73% was allocated to the expansion
of production capacity of L’Amalí plant. In the FY19, cash flow
generated by operating activities was Ps.8,542 million compared to
Ps.6,428 million in FY18 explained mainly by a higher profitability
level.
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$350 million.
Start-up date is projected for mid-2020.
The Company continued with the overall project execution during
the quarter. All imported material of the main equipment were
received at site. In addition, civil works for main foundations,
silos and buildings structures are completed, and the supply of
local steel structures is almost fully completed. Regarding the
electromechanical construction, the crusher was tested, the kiln
system erection was completed, and the raw and cement mill erection
presents good progress. Additions to Property, Plant and Equipment
related to this project during 4Q19 amounted to approximately
Ps.1,554 million.
Recent Events
On March 10, 2020 Loma Negra Calls for a General Annual Ordinary
and Extraordinary Shareholders’ Meeting. Loma Negra announced that
its General Annual Ordinary and Extraordinary Shareholders Meeting
will be held on April 16, 2020 at 10:00 am Buenos Aires time on
first call, and on the same day at 12:00 pm Buenos Aires time on
second call. The meeting will be held at the auditorium located on
the fourth floor of Boulevard Cecilia Grierson 355, Autonomous City
of Buenos Aires. Among the key items of the agenda, the Company’s
Board has submitted for consideration (i) its recommendation to
fully re-invest Loma Negra’s 2019 earnings; and (ii) the approval a
global program for the issuance of Negotiable Bonds in accordance
with the provisions of the Negotiable Bonds Law No. 23,576 for a
maximum amount in circulation of up to US$ 150,000,000 (United
States dollars one hundred fifty million) or its equivalent in
other currencies.
4Q19 Earnings Conference Call
When: 10:00 a.m. U.S. ET (11:00 p.m. BAT), March 11, 2020
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/loma200311k3M1Mydg.html
Replay: A telephone replay of the conference call will be
available between March 10, 2020 at 1:00 pm U.S. E.T. and ending on
March 18, 2020. 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 10139831.
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 December 31,
2019 and 2018
(amounts expressed in millions of
pesos, unless otherwise noted)
As of December 31,
2019
2018
ASSETS
Non-current assets
Property, plant and equipment
45,021
33,655
Intangible assets
128
336
Investments
3
3
Goodwill
26
26
Inventories
1,569
1,042
Other receivables
568
1,449
Right to use assets
409
-
Trade accounts receivable
2
6
Total non-current
assets
47,725
36,517
Current assets
Inventories
5,414
5,811
Other receivables
619
590
Trade accounts receivable
2,752
3,176
Investments
1,020
3,223
Cash and banks
1,548
1,241
Total current assets
11,343
14,041
TOTAL ASSETS
59,078
50,558
SHAREHOLDERS' EQUITY
Capital stock and other capital
related accounts
11,054
11,054
Reserves
11,873
3,508
Retained earnings
3,839
8,366
Accumulated other comprehensive
income
330
422
Equity attributable to the owners
of the Company
27,097
23,350
Non-controlling interests
2,231
2,115
TOTAL SHAREHOLDERS'
EQUITY
29,328
25,464
LIABILITIES
Non-current
liabilities
Borrowings
6,689
4,011
Accounts payables
139
596
Provisions
566
450
Other liabilities
51
12
Debts for leases
340
-
Deferred tax liabilities
5,483
4,901
Total non-current
liabilities
13,269
9,970
Current liabilities
Borrowings
5,537
5,162
Accounts payable
9,064
7,466
Advances from customers
193
259
Salaries and social security
payables
959
975
Tax liabilities
543
1,199
Debts for leases
103
-
Other liabilities
83
63
Total current
liabilities
16,481
15,124
TOTAL LIABILITIES
29,750
25,094
TOTAL SHAREHOLDERS' EQUITY AND
LIABILITIES
59,078
50,558
Table 9: Consolidated
Statements of Profit or Loss and Other Comprehensive Income
(unaudited)
(amounts expressed in millions of
pesos, unless otherwise noted)
Three-months ended December
31,
Twelve-months ended December
31,
2019
2018
% Change
2019
2018
% Change
Net revenue
9,074
10,669
-15.0%
38,952
41,238
-5.5%
Cost of sales
(6,349)
(7,538)
-15.8%
(28,142)
(30,740)
-8.5%
Gross profit
2,725
3,131
-13.0%
10,810
10,498
3.0%
Selling and administrative
expenses
(756)
(734)
3.1%
(2,904)
(2,975)
-2.4%
Other gains and losses
31
140
-77.6%
37
168
-78.0%
Tax on debits and credits to bank
accounts
(100)
(86)
15.6%
(404)
(391)
3.3%
Finance costs, net
Exchange rate differences
353
488
-27.6%
(1,190)
(1,910)
-37.7%
Financial income
-
146
n/a
60
128
-52.9%
Financial expenses
(647)
(348)
85.8%
(1,793)
(1,104)
62.4%
Gain on net monetary position
89
64
38.0%
1,115
329
239.1%
Profit before taxes
1,696
2,802
-39.5%
5,730
4,742
20.8%
Income tax expense
Current
(360)
(801)
-55.1%
(1,103)
(1,614)
-31.7%
Deferred
(210)
(55)
283.1%
(583)
(127)
359.2%
Net profit
1,126
1,946
-42.2%
4,044
3,001
34.8%
Other Comprehensive
Income
Items to be reclassified through
profit and loss:
Exchange differences on
translating foreign operations
(376)
(871)
-56.8%
(180)
726
n/a
Total other comprehensive
(loss) income
(376)
(871)
-56.8%
(180)
726
n/a
TOTAL COMPREHENSIVE
INCOME
749
1,075
-30.3%
3,863
3,726
3.7%
Net Profit for the period
attributable to:
Owners of the Company
1,050
1,835
-42.8%
3,839
2,769
38.7%
Non-controlling interests
76
111
-31.7%
205
232
-11.7%
NET PROFIT FOR THE
PERIOD
1,126
1,946
-42.2%
4,044
3,001
34.8%
Total comprehensive income
(loss) attributable to:
Owners of the Company
858
1,391
-38.3%
3,747
3,139
19.4%
Non-controlling interests
(108)
(316)
-65.7%
116
587
-80.2%
TOTAL COMPREHENSIVE
INCOME
749
1,075
-30.3%
3,863
3,726
3.7%
Earnings per share (basic and
diluted):
1.7611
3.0791
-42.8%
6.4413
4.6454
38.7%
Table 10: Consolidated Statement of
Cash Flows for the Twelve-months and Three-months ended December
31, 2019 and 2018
(amounts expressed in millions of pesos,
unless otherwise noted)
Three-months ended December
31,
Twelve-months ended December
31,
2019
2018
2019
2018
CASH FLOWS FROM OPERATING
ACTIVITIES
Net profit for the period
1,126
1,946
4,044
3,001
Adjustments to reconcile net profit to net
cash provided by operating activities
Income tax expense
570
856
1,686
1,741
Depreciation and amortization
887
783
3,264
3,263
Provisions
(42)
7
50
109
Interest expense
210
263
1,126
640
Exchange rate differences
(943)
(2,261)
(305)
269
Others
8
2
19
(9)
Gain on disposal of Property, plant and
equipment
7
(26)
(3)
(26)
Changes in operating assets and
liabilities
Inventories
228
3
52
(602)
Other receivables
617
454
473
47
Trade accounts receivable
50
49
(694)
(1,090)
Advances from customers
8
(33)
(26)
(154)
Accounts payable
145
1,511
981
1,027
Salaries and social security payables
188
140
359
103
Provisions
(47)
(35)
(109)
(170)
Tax liabilities
(9)
(357)
244
(55)
Other liabilities
2
368
263
333
Income tax paid
(418)
(236)
(1,767)
(1,670)
Gain on net monetary position
(89)
(64)
(1,115)
(329)
Net cash generated / used in by operating
activities
2,498
3,369
8,542
6,428
CASH FLOWS FROM INVESTING
ACTIVITIES
Proceeds from disposal of Property, plant
and equipment
30
1
65
8
Payments to acquire Property, plant and
equipment
(2,392)
(1,794)
(11,813)
(5,256)
Payments to acquire Intangible Assets
(26)
(21)
(57)
(35)
Advances payments to acquire Property,
plant and equipment
-
(1,143)
-
(1,143)
Contributions to Trust
21
(24)
(30)
(71)
Net cash used in investing activities
(2,367)
(2,982)
(11,835)
(6,498)
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from borrowings
2,883
293
9,496
2,229
Interest paid
(555)
(317)
(2,249)
(1,422)
Repayment of borrowings
(1,516)
(1,543)
(5,731)
(4,484)
Debts for leases
(29)
-
(102)
-
Net cash generated / used in by financing
activities
783
(1,567)
1,415
(3,677)
Net decrease in cash and cash
equivalents
914
(1,179)
(1,878)
(3,747)
Cash and cash equivalents at the beginning
of the period
1,512
4,735
4,464
7,222
Effect of the re-expression in homogeneous
cash currency ("Inflation-Adjusted")
(40)
(40)
(162)
(151)
Effects of the exchange rate differences
on cash and cash equivalents in foreign currency
181
948
143
1,139
Cash and cash equivalents at the end of
the period
2,567
4,464
2,567
4,464
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 December
31,
Twelve-months ended December
31,
2019
%
2018
%
2019
%
2018
%
Net revenue
8,713
100.0%
6,741
100.0%
31,828
100.0%
22,163
100.0%
Cement, masonry cement and
lime—Argentina
6,744
77.4%
4,879
72.4%
24,007
75.4%
16,283
73.5%
Cement—Paraguay
956
11.0%
657
9.7%
3,190
10.0%
1,960
8.8%
Concrete
767
8.8%
1,133
16.8%
3,954
12.4%
3,657
16.5%
Railroad
834
9.6%
650
9.6%
2,982
9.4%
2,136
9.6%
Aggregates
119
1.4%
121
1.8%
498
1.6%
334
1.5%
Others
47
0.5%
34
0.5%
157
0.5%
118
0.5%
Eliminations
(754)
-8.7%
(732)
-10.9%
(2,960)
-9.3%
(2,325)
-10.5%
Cost of sales
5,584
100.0%
4,499
100.0%
21,470
100.0%
15,436
100.0%
Cement, masonry cement and
lime—Argentina
4,001
71.6%
3,045
67.7%
15,250
71.0%
10,619
68.8%
Cement—Paraguay
653
11.7%
457
10.1%
2,180
10.2%
1,379
8.9%
Concrete
782
14.0%
1,046
23.2%
3,761
17.5%
3,422
22.2%
Railroad
741
13.3%
536
11.9%
2,610
12.2%
1,913
12.4%
Aggregates
130
2.3%
129
2.9%
526
2.4%
360
2.3%
Others
31
0.6%
20
0.4%
103
0.5%
67
0.4%
Eliminations
(754)
-13.5%
(732)
-16.3%
(2,960)
-13.8%
(2,325)
-15.1%
Selling, admin. expenses and other
gains & losses
606
100.0%
365
100.0%
2,219
100.0%
1,452
100.0%
Cement, masonry cement and
lime—Argentina
501
82.6%
264
72.4%
1,771
79.8%
1,085
74.7%
Cement—Paraguay
26
4.3%
25
6.9%
96
4.3%
64
4.4%
Concrete
29
4.8%
31
8.4%
120
5.4%
118
8.1%
Railroad
42
7.0%
42
11.5%
182
8.2%
150
10.3%
Aggregates
(11)
-1.8%
(8)
-2.3%
(8)
-0.3%
(4)
-0.3%
Others
19
3.1%
11
3.1%
59
2.7%
40
2.7%
Depreciation and amortization
385
100.0%
272
100.0%
1,460
100.0%
892
100.0%
Cement, masonry cement and
lime—Argentina
184
47.6%
118
43.5%
722
49.4%
416
46.6%
Cement—Paraguay
130
33.9%
90
32.9%
474
32.4%
280
31.4%
Concrete
17
4.4%
9
3.3%
62
4.2%
32
3.6%
Railroad
52
13.4%
40
14.5%
183
12.6%
137
15.4%
Aggregates
5
1.3%
15
5.4%
19
1.3%
24
2.7%
Others
(2)
-0.6%
1
0.3%
0
0.0%
3
0.3%
Adjusted EBITDA
2,907
100.0%
2,149
100.0%
9,599
100.0%
6,167
100.0%
Cement, masonry cement and
lime—Argentina
2,425
83.4%
1,689
78.6%
7,708
80.3%
4,994
81.0%
Cement—Paraguay
407
14.0%
265
12.3%
1,388
14.5%
796
12.9%
Concrete
(27)
-0.9%
66
3.1%
135
1.4%
150
2.4%
Railroad
103
3.5%
111
5.2%
373
3.9%
210
3.4%
Aggregates
5
0.2%
15
0.7%
(1)
0.0%
2
0.0%
Others
(5)
-0.2%
3
0.2%
(4)
0.0%
14
0.2%
Reconciling items:
Effect by translation in homogeneous cash
currency ("Inflation-Adjusted")
(20)
1,172
1,608
4,787
Depreciation and amortization
(887)
(783)
(3,264)
(3,263)
Tax on debits and credits banks
accounts
(100)
(86)
(404)
(391)
Finance costs, net
(205)
351
(1,809)
(2,558)
Income tax
(570)
(856)
(1,686)
(1,741)
NET PROFIT FOR THE PERIOD
1,126
1,946
4,044
3,001
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200310005892/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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