[PART I](index=10&type=section&id=PART%20I) This part covers the company's foundational information, including key personnel, offer details, critical risk factors, and a comprehensive overview of its business operations and development [ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS](index=10&type=section&id=ITEM%201.%20IDENTITY%20OF%20DIRECTORS%2C%20SENIOR%20MANAGEMENT%20AND%20ADVISERS) This section states that information regarding the identity of directors, senior management, and advisers is not applicable for this report - Information for Directors and Senior Management, Advisers, and Auditors is marked as 'Not applicable'[33](index=33&type=chunk)[34](index=34&type=chunk)[35](index=35&type=chunk) [ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE](index=10&type=section&id=ITEM%202.%20OFFER%20STATISTICS%20AND%20EXPECTED%20TIMETABLE) This section indicates that details regarding offer statistics and the expected timetable are not applicable for this report - Offer Statistics and Method and Expected Timetable are marked as 'Not applicable'[36](index=36&type=chunk)[37](index=37&type=chunk) [ITEM 3. KEY INFORMATION](index=10&type=section&id=ITEM%203.%20KEY%20INFORMATION) This section outlines key information about the company, including reserved items, capitalization and indebtedness, reasons for the offer and use of proceeds, and a comprehensive overview of risk factors - Sections A (Reserved), B (Capitalization and Indebtedness), and C (Reasons for the Offer and Use of Proceeds) are marked as 'Not applicable'[38](index=38&type=chunk)[39](index=39&type=chunk) - The company's business, financial condition, and results of operations are materially affected by macroeconomic, regulatory, social, and political conditions in Argentina, as well as exchange rates between the peso and foreign currencies, particularly the U.S. dollar[42](index=42&type=chunk)[43](index=43&type=chunk) - Investing in Argentina, a developing economy, entails inherent risks such as political, social, and economic instability, including price controls, foreign exchange controls, currency devaluations, high interest rates, and increased government intervention[44](index=44&type=chunk)[45](index=45&type=chunk) [D. Risk Factors](index=10&type=section&id=D.%20Risk%20Factors) The company faces significant risks primarily due to its operations in Argentina, including economic volatility, high inflation, peso devaluation, and government intervention [Risks Relating to Argentina](index=10&type=section&id=Risks%20Relating%20to%20Argentina) Risks related to Argentina include extreme economic volatility, high inflation (CPI **117.8% in 2024**), significant peso depreciation (**27.7% in 2024**), and stringent exchange controls Argentine Economic Indicators (2022-2024) | Indicator | 2024 | 2023 | 2022 | | :-------------------------------- | :----- | :----- | :----- | | GDP Growth | (1.7)% | (1.6)% | 5.0% | | CPI Inflation | 117.8% | 211.4% | 94.8% | | Peso Depreciation (YoY) | 27.7% | 356.44% | 70% | | BCRA International Reserves (Dec 31) | N/A | US$23.1B | US$65.7B (2018) | | Fiscal Surplus (as % of GDP) | 0.3% | (2.9)% | (2.4)% | - The new government, which took office in December 2023, implemented policies aimed at deregulating the economy, including declaring a public emergency and approving the 'Bases Law' for legislative delegations, large investments, labor modernization, and tax changes[51](index=51&type=chunk)[52](index=52&type=chunk)[53](index=53&type=chunk)[54](index=54&type=chunk) - The Argentine banking system, despite recent growth in loans and deposits, remains vulnerable due to short-term deposits and limited long-term funding, posing risks of instability that could affect the company's sales and increase uncollectible accounts[122](index=122&type=chunk)[123](index=123&type=chunk)[126](index=126&type=chunk) [Risks Relating to Our Indirect Controlling Shareholder](index=21&type=section&id=Risks%20Relating%20to%20Our%20Indirect%20Controlling%20Shareholder) The company faces reputational and financial risks due to its indirect controlling shareholder, Mover Participações S.A., whose subsidiary CCCC was involved in Brazil's 'Operation Car Wash' corruption investigation - Construções e Comércio Camargo Corrêa S.A. (CCCC), a subsidiary of Mover Participações S.A., was involved in Brazil's 'Operation Car Wash' investigation, admitting to anti-corruption and antitrust law violations and agreeing to pay over **1,400 million Brazilian reais** in compensation[135](index=135&type=chunk)[136](index=136&type=chunk) - InterCement Participações S.A., the company's controlling shareholder, is undergoing a judicial reorganization process in Brazil, introducing uncertainty regarding its future operations and financial stability, and potentially leading to a change of control for Loma Negra[141](index=141&type=chunk) - A pledge of **52.14%** of Loma Negra's total capital stock by Intercement Trading e Inversiones S.A. (a subsidiary of the controlling shareholder) as collateral for debenture obligations could result in market fluctuations and a potential change of control if the pledge is executed[259](index=259&type=chunk) [Risks Relating to Our Business and Industry](index=22&type=section&id=Risks%20Relating%20to%20Our%20Business%20and%20Industry) The company's business is exposed to the cyclical nature of the cement industry, intense competition, and fluctuations in construction projects - The cement industry is cyclical and sensitive to economic conditions, leading to potential declines in demand and competitive pressure to lower prices, which could diminish profit margins[142](index=142&type=chunk) - Cement consumption is highly correlated with construction levels; a reduction in private or public construction projects in Argentina, such as the government's decision to stop financing public works, could significantly decrease demand for the company's products[148](index=148&type=chunk)[150](index=150&type=chunk) Energy Costs as Percentage of Total Cost of Sales | Energy Type | 2024 | 2023 | 2022 | | :------------ | :--- | :--- | :--- | | Thermal Energy | 13% | 16% | 16% | | Electricity | 8% | 8% | 9% | - The railway concession for Ferrosur Roca S.A. is provisionally extended until September 2025, but may be revoked earlier without compensation, and the government is implementing significant changes to railway infrastructure policies, potentially impacting the company's transportation operations[207](index=207&type=chunk)[208](index=208&type=chunk)[210](index=210&type=chunk)[211](index=211&type=chunk) - Compliance with Resolution 54/2018, requiring cement bags to be reduced to a maximum net content of **25 kilograms** by July 1, 2025, could adversely affect operations and profitability due to uncertainties in commercialization of existing stock[190](index=190&type=chunk)[191](index=191&type=chunk) [Risks Relating to Our Ordinary Shares and the ADSs](index=33&type=section&id=Risks%20Relating%20to%20Our%20Ordinary%20Shares%20and%20the%20ADSs) The market price of the company's ADSs is subject to significant fluctuations due to various factors, including operational results, economic conditions in Argentina, and investor perceptions - The market price of the company's ADSs increased by **68% in 2024** and **4% in 2023**, but remains subject to significant fluctuations due to factors like operational changes, investor perceptions, economic trends in Argentina, and catastrophic events[233](index=233&type=chunk)[234](index=234&type=chunk)[235](index=235&type=chunk) - Argentine foreign exchange restrictions, including those reinstated in September 2019 and amended by BCRA Communication 'A' 8226, may limit the company's ability to transfer funds abroad for dividend payments to foreign shareholders, potentially affecting ADS holders[243](index=243&type=chunk)[244](index=244&type=chunk)[245](index=245&type=chunk)[246](index=246&type=chunk) - The controlling shareholder's **52.14%** ownership limits the ability of other shareholders to influence corporate matters, including board composition, mergers, dividends, and asset dispositions, and their interests may conflict with those of other shareholders[256](index=256&type=chunk)[257](index=257&type=chunk) - As a 'foreign private issuer' and 'controlled company,' Loma Negra follows Argentine corporate governance practices, which differ from NYSE standards (e.g., no majority independent directors, no independent compensation/nominating committees), potentially limiting protections for investors[261](index=261&type=chunk)[262](index=262&type=chunk)[263](index=263&type=chunk)[264](index=264&type=chunk) [ITEM 4. INFORMATION ON THE COMPANY](index=32&type=section&id=ITEM%204.%20INFORMATION%20ON%20THE%20COMPANY) This section provides a comprehensive overview of Loma Negra, detailing its history, business operations, product portfolio, production processes, capacities, and market position - Loma Negra produces and distributes cement, masonry cement, aggregates, concrete, and lime, primarily for private and public construction, holding a **44.4% market share** in Argentina's cement sales volume as of December 31, 2024[288](index=288&type=chunk) Key Financial Data (2023-2024) | Metric | 2024 (Ps. millions) | 2023 (Ps. millions) | | :------------- | :------------------ | :------------------ | | Revenues | 699,179 | 919,313 | | Net Profit | 153,627 | 21,080 | | Net Profit Margin | 22.0% | 2.3% | | Net Debt | 162,348 | 306,254 | - The company's existing quarries have sufficient limestone reserves to support operations for approximately **149 years**, based on the cement production levels of the last five years[289](index=289&type=chunk) [A. History and Development of the Company](index=32&type=section&id=A.%20History%20and%20Development%20of%20the%20Company) Loma Negra, incorporated in 1926, has grown into a vertically-integrated cement and concrete company in Argentina - Loma Negra was incorporated on May 10, 1926, with a broad corporate purpose including industrial, mining, construction, transportation, and public services activities[277](index=277&type=chunk) - The company acquired concrete operations in the greater Buenos Aires area and Rosario in 1998, operating under the Lomax brand and becoming a leading concrete company in those regions[278](index=278&type=chunk) - In 2005, Loma Negra became part of the InterCement Group, leading to significant investments in production capacity and efficiency, including diversifying energy matrix with alternative fuels[280](index=280&type=chunk) - In December 2021, the second line of the L'Amalí plant was inaugurated, significantly increasing production capacity and incorporating high-efficiency, sustainable features like alternative fuel use[285](index=285&type=chunk) [B. Business Overview](index=33&type=section&id=B.%20Business%20Overview) Loma Negra is a vertically-integrated cement and concrete company in Argentina, producing cement, masonry cement, aggregates, concrete, and lime [Our Products](index=43&type=section&id=Our%20Products) Loma Negra offers a diverse portfolio of cement products, masonry cement (Plasticor brand), lime (Cacique Plus, Cacique Max, Loma Negra Plus), and concrete/aggregates (Lomax brand) - Cement accounted for approximately **88% of shipments in 2023** and **89% in 2024**, with bagged cement representing **56% of sales in 2023** and **60% in 2024**[291](index=291&type=chunk)[292](index=292&type=chunk) - The company's masonry cement brand, Plasticor, is a market leader in Argentina[295](index=295&type=chunk) - Lomax, the company's concrete brand, focuses on quality, operational and logistic capacity, and customized solutions for large construction projects[299](index=299&type=chunk) [Production Process](index=43&type=section&id=Production%20Process) The cement production process involves nine main stages: mining, transportation, primary crushing, pre-homogenization, grinding and homogenization (raw meal), clinkerization (burning raw meal), cooling and final milling, storage, and dispatch - Cement production follows a dry process, including extraction of limestone and clay, grinding into 'raw meal', burning in kilns at up to **1,450°C** to produce 'clinker', and final milling and storage[300](index=300&type=chunk)[301](index=301&type=chunk)[306](index=306&type=chunk)[307](index=307&type=chunk)[308](index=308&type=chunk) - Lime production involves calcination of limestone in rotary kilns at up to **1,200°C** to produce quicklime, which can then be processed into hydrated lime[316](index=316&type=chunk)[317](index=317&type=chunk)[319](index=319&type=chunk) - Masonry cement production blends clinker, gypsum, and plasticizing materials to create a mortar for brick, block, and stone masonry construction[322](index=322&type=chunk)[323](index=323&type=chunk) [Capacity and Volumes](index=46&type=section&id=Capacity%20and%20Volumes) As of December 31, 2024, Loma Negra's total installed cement capacity was **12.1 million tons** and clinker capacity was **7.3 million tons** Operating Data (Annual Capacity and Production Volume in Million Tons) | Metric | 2024 | 2023 | 2022 | | :-------------------------- | :--- | :--- | :--- | | Total installed cement capacity | 12.1 | 12.1 | 12.1 | | Total installed clinker capacity | 7.3 | 7.1 | 7.1 | | Installed concrete capacity (million m³) | 1.3 | 1.3 | 1.3 | | Installed aggregates capacity | 2.2 | 2.2 | 2.2 | | Installed lime capacity | 0.5 | 0.5 | 0.5 | | Cement, masonry and lime total production | 4.8 | 6.4 | 6.5 | | Clinker Total production | 3.1 | 4.3 | 4.3 | Annual Production of Cement, Masonry Cement and Lime by Plant (2022-2024) | Name | 2024 (million tons) | 2023 (million tons) | 2022 (million tons) | | :---------------- | :------------------ | :------------------ | :------------------ | | Barker | 0.1 | 0.1 | 0.1 | | Catamarca | 0.9 | 1.2 | 1.2 | | L'Amalí/LomaSer | 2.6 | 3.6 | 3.6 | | Olavarría | 0.6 | 0.8 | 0.9 | | San Juan | 0.1 | 0.2 | 0.2 | | Zapala | 0.3 | 0.3 | 0.3 | | Ramallo | 0.2 | 0.2 | 0.2 | | **Total** | **4.8** | **6.4** | **6.5** | [Quality Control](index=48&type=section&id=Quality%20Control) Loma Negra maintains stringent quality control measures throughout its cement production process, including chemical, physical, and x-ray tests on raw materials, clinker, and finished products - Quality control involves periodic chemical, physical, and x-ray tests on raw materials, clinker, and finished products at various stages of the production line[330](index=330&type=chunk)[331](index=331&type=chunk) - All of Loma Negra's plants have received ISO 9001 certification, reflecting the quality of products and operating procedures[331](index=331&type=chunk) [Raw Materials](index=48&type=section&id=Raw%20Materials) The primary raw materials for cement production include limestone, clay, gypsum, and clinker additions like slag and pozzolana, constituting **19% of total cost of sales in 2024** - Raw materials (gypsum, slag, iron ore, steel slabs, clay, sand, pozzolana) accounted for **19% of total cost of sales in 2024**, **18% in 2023**, and **15% in 2022**[152](index=152&type=chunk)[332](index=332&type=chunk) - All limestone used in 2024 was sourced from the company's own quarries, ensuring cost competitiveness[332](index=332&type=chunk) [Mining Operations Disclosure (Mineral Reserves)](index=48&type=section&id=Mining%20Operations%20Disclosure%20%28Mineral%20Reserves%29) Loma Negra operates four open-pit quarries, holding approximately **1,068.5 million tons of limestone reserves**, sufficient for about **149 years** of cement production - Loma Negra operates four open-pit quarries, with total limestone reserves of approximately **1,068.5 million tons**, estimated to supply **149 years** of cement production at current consumption rates[338](index=338&type=chunk) - Proven and probable reserve estimates are based on recoverable tons, geological interpretation, and statistical inferences from drilling and sampling, with limestone generally requiring at least **75% calcium carbonate (CaCO3) concentration**[334](index=334&type=chunk)[336](index=336&type=chunk)[346](index=346&type=chunk) Summary of Mineral Reserves as of December 31, 2024 (Million Tons) | Material | Proven (Million Tons) | Probable (Million Tons) | Total (Million Tons) | | :----------------- | :-------------------- | :---------------------- | :------------------- | | Limestone: | | | | | Doña Amalía | 49.2 | 56.2 | 105.4 | | El Salitral y Cerro Bayo | 30.4 | 48.4 | 78.8 | | Barker | 43.6 | 27.0 | 70.5 | | La Pampita y Entorno | 575.8 | 35.3 | 611.1 | | Cerro Soltero I | — | 53.5 | 53.5 | | Cerro Soltero II | — | 111.6 | 111.6 | | El Cerro | — | 37.6 | 37.6 | | Granitic aggregates: | | | | | La Preferida | 59.0 | 54.2 | 113.2 | [Summary Mining Operations Disclosure](index=49&type=section&id=Summary%20Mining%20Operations%20Disclosure) Loma Negra operates four open-pit limestone quarries and one granite quarry, all in the production stage, with total limestone reserves of approximately **1,068.5 million tons** - The company owns and operates four open-pit quarries for limestone and one for granite, all in the production stage, with total limestone reserves of approximately **1,068.5 million tons**[338](index=338&type=chunk)[340](index=340&type=chunk) - Mining capital expenditures are directed towards developing new quarries and sustaining investments in equipment, crushing systems, safety, and environmental compliance[340](index=340&type=chunk) Aggregate Production by Material (2022-2024) | Material | 2024 (thousand tons) | 2023 (thousand tons) | 2022 (thousand tons) | | :------------------- | :------------------- | :------------------- | :------------------- | | Limestone | 7,179.3 | 8,034.7 | 8,382.9 | | Granite | 1,100.6 | 1,459.8 | 1,310.7 | [Individual Properties Disclosure](index=52&type=section&id=Individual%20Properties%20Disclosure) The La Pampita y Entorno quarry, located in Olavarría, Buenos Aires, is a material mining operation supplying limestone to the L'Amalí and Olavarría cement plants - The La Pampita y Entorno quarry, encompassing La Pampita, Don Gabino, Los Abriles, and San Alfredo Sur II, is located **20 kilometers southeast of Olavarría** and has been exploited since 1999[351](index=351&type=chunk)[352](index=352&type=chunk) - The quarry supplies limestone to the L'Amalí and Olavarría cement plants, which are located **2 and 5 kilometers away**, respectively[376](index=376&type=chunk) La Pampita y Entorno Mineral Reserves as of December 31, 2024 | Reserve Type | Amount (Million Tons) | Grades/Qualities (% CaO) | | :------------- | :-------------------- | :----------------------- | | Proven | 575.8 | 47.4 | | Probable | 35.3 | 47.1 | | **Total** | **611.1** | **47.4** | - A life of mine of **122 years** has been calculated for the La Pampita y Entorno quarry based on the last five years of exploitation, or **66 years** considering the maximum capacity of the plants it supplies[397](index=397&type=chunk) [Energy Sources](index=58&type=section&id=Energy%20Sources) Energy is a significant cost component, accounting for **21% of total cost of sales in 2024**, with thermal energy at **13%** and electrical power at **8%** - Energy costs represented **21% of total cost of sales in 2024**, with thermal energy at **13%** and electrical power at **8%**[406](index=406&type=chunk)[407](index=407&type=chunk)[412](index=412&type=chunk) - The company's energy matrix is diversified, allowing flexibility to optimize fuel sources based on price and availability, with natural gas prevailing as the main source of thermal energy[407](index=407&type=chunk)[408](index=408&type=chunk)[411](index=411&type=chunk) - In 2024, **58%** of the company's electrical power requirements were covered by renewable energy sources, exceeding the **18% legal requirement for 2023** and moving towards the **20% goal by 2025**[415](index=415&type=chunk)[416](index=416&type=chunk)[417](index=417&type=chunk) - Co-processing, which uses waste as an alternative fuel, accounted for **4.3% of total thermal energy consumption in 2024**, up from **2.2% in 2023**, contributing to sustainability and cost reduction[554](index=554&type=chunk) [Sales, Marketing and Customers](index=60&type=section&id=Sales%2C%20Marketing%20and%20Customers) Loma Negra serves over **1,000 clients** in Argentina through dedicated sales teams, maintaining long-term, often exclusive, relationships with approximately **65% of its customer base** - The company serves over **1,000 clients** in Argentina, with approximately **65% of its customer base** operating under long-standing, exclusive relationships, representing over **77% of total cement shipments**[423](index=423&type=chunk) - In 2024, **64% of total cement sales** were made directly to wholesale distributors, **26% to concrete producers**, **6% to industrial customers**, and **3% to construction companies and others**[424](index=424&type=chunk) - Marketing efforts include strengthening brand image at points of sale and through sponsorships, reinforcing Loma Negra as a synonym for cement in Argentina[430](index=430&type=chunk) [Distribution](index=61&type=section&id=Distribution) Loma Negra operates a nationwide distribution system across six regions in Argentina, with the Buenos Aires Complex (centered around LomaSer) serving the principal market - The company's distribution platform is divided into six regions: Buenos Aires, Central, Northwestern, Northeastern, Patagonia, and Cuyo, with the Province of Buenos Aires being the principal market (**44% of total volume sold in 2024**)[431](index=431&type=chunk) - LomaSer, located near Buenos Aires, acts as a blending, distribution, and logistics center, enabling quick response to client needs and delivering cement within **24 hours** in the Greater Buenos Aires area[435](index=435&type=chunk) - The Ferrosur Roca freight railway network, extending **3,100 kilometers** and connected to five of the company's plants, is utilized for shipping products and raw materials, and also generates revenue from third-party freight services[437](index=437&type=chunk) [Our Subsidiaries](index=62&type=section&id=Our%20Subsidiaries) Loma Negra's principal subsidiaries are Cofesur S.A.U. (**100% owned**), which indirectly controls Ferrosur Roca S.A. (**80% owned**) for rail freight, and Recycomb S.A.U. (**100% owned**) for industrial waste recycling Principal Subsidiaries and Equity Ownership | Subsidiary | Equity Ownership Interest (%) | Main Activity | | :------------------ | :---------------------------- | :------------ | | Ferrosur Roca S.A. | 80.00 | Rail freight | | Recycomb S.A.U | 100.00 | Waste recycling | - Ferrosur Roca S.A. operates a **3,100-kilometer** freight railway network, strategic for Loma Negra's business as it links directly to five of its plants and a distribution center[440](index=440&type=chunk) - Recycomb S.A.U. operates a blending facility for recycling industrial waste into alternative fuel sources, with an annual production capacity of **106,000 tons**[450](index=450&type=chunk) - Ferrosur Roca's railway concession, initially set to expire in March 2023, has been provisionally extended until September 10, 2025, with ongoing discussions regarding its future as a cargo operator under an open access scheme[445](index=445&type=chunk)[446](index=446&type=chunk)[448](index=448&type=chunk) [Information Technology](index=63&type=section&id=Information%20Technology) Loma Negra relies on its information technology infrastructure and automated operating systems to monitor production processes, ensure consistency, and support business growth - Information technology infrastructure and automated operating systems are critical for efficient operation, managing production processes, and supporting business growth[451](index=451&type=chunk) - The company uses an enterprise resource planning (ERP) model to develop production, sourcing, and pricing models based on anticipated consumer demand[451](index=451&type=chunk) - Loma Negra holds license agreements for intellectual property rights with companies such as Microsoft, SAP, Adobe, and Aveva[453](index=453&type=chunk) [Insurance](index=64&type=section&id=Insurance) Loma Negra maintains insurance policies against third-party damages, property loss, and business interruption risks for its plants, equipment, and buildings, with an aggregate value at risk of approximately **US$1.49 billion** as of December 31, 2024 - The company maintains insurance policies covering property loss and business interruption risks for its plants, equipment, and buildings, with an aggregate value at risk of approximately **US$1,494,572,633** as of December 31, 2024[454](index=454&type=chunk) - These policies have a deductible of **US$250,000 per claim**, and coverage for loss of profit derived from material damages is **21 days**[454](index=454&type=chunk) - As of December 31, 2024, the company's insurance does not cover losses associated with cybersecurity risks[219](index=219&type=chunk)[332](index=332&type=chunk) [Sustainability and Social Responsibility](index=64&type=section&id=Sustainability%20and%20Social%20Responsibility) Loma Negra is committed to sustainability through its Triple Impact concept, focusing on economic growth, social contribution, and environmental care - Loma Negra operates under a 'Triple Impact' concept, promoting economic growth, social contribution, and environmental care, and publishes an annual Sustainability Report[456](index=456&type=chunk)[457](index=457&type=chunk) - The company's 2030 Climate Roadmap focuses on reducing carbon footprint, promoting circular economy, diversifying energy matrix, and efficient resource use, aligning with Global Cement and Concrete Association (GCCA) guidelines[462](index=462&type=chunk)[463](index=463&type=chunk)[467](index=467&type=chunk) - In 2024, **57.5% of electricity** came from renewable sources, and **4.26% of thermal energy** from alternative fuels, resulting in a reduction of **907,347 t CO2e** compared to 2023[468](index=468&type=chunk) - The Loma Negra Foundation implements programs (Bridge, Commitment, Roots, Transform) aligned with UN Sustainable Development Goals, focusing on youth employment, community alliances, productive activities, and innovative solutions for social and environmental problems[470](index=470&type=chunk)[471](index=471&type=chunk)[472](index=472&type=chunk)[473](index=473&type=chunk)[474](index=474&type=chunk)[475](index=475&type=chunk) [Competition](index=66&type=section&id=Competition) The Argentine cement market is competitive, dominated by four main groups: Loma Negra, Cementos Avellaneda, Holcim Argentina, and Petroquímica Comodoro Rivadavia - The Argentine cement market is competitive, with four principal groups: Loma Negra, LafargeHolcim (through Juan Minetti S.A. and Corcemar S.A.), Cementos Avellaneda S.A., and Petroquímica Comodoro Rivadavia S.A[477](index=477&type=chunk) - Loma Negra is the only cement company in Argentina with nationwide coverage, while competitors like Holcim Argentina S.A. have strong market positions in specific provinces[480](index=480&type=chunk)[481](index=481&type=chunk) - In December 2021, Loma Negra inaugurated the second line of its L'Amalí plant, increasing its capacity by approximately **3 million tons annually** and making it one of the largest cement plants in South America[483](index=483&type=chunk) [Legal and Regulatory Matters](index=67&type=section&id=Legal%20and%20Regulatory%20Matters) Loma Negra operates under extensive environmental, health, and safety regulations at national and provincial levels, requiring permits and compliance certificates - The company operates under extensive environmental, health, and safety regulations at national and provincial levels, requiring permits and environmental compliance certificates[486](index=486&type=chunk)[487](index=487&type=chunk) - Loma Negra implements Annual Environmental Monitoring Plans (PAM-A) and engages authorized laboratories to ensure compliance with emissions and air quality regulations[488](index=488&type=chunk) - Mining activities are governed by the Argentine Mining Code, requiring environmental impact evaluation reports and declarations, which must be renewed every two years[489](index=489&type=chunk)[490](index=490&type=chunk)[491](index=491&type=chunk) - No significant monetary or non-monetary fines or sanctions for non-compliance with environmental laws or regulations were recorded in 2023 and 2024[487](index=487&type=chunk) [C. Organizational Structure](index=68&type=section&id=C.%20Organizational%20Structure) The organizational structure of Loma Negra includes its direct and indirect equity ownership interests in key subsidiaries - Loma Negra has an indirect ownership in Ferrosur Roca S.A. through Cofesur SAU, in which it holds a direct **100% equity ownership interest**. Cofesur SAU has an **80% direct equity ownership interest** in Ferrosur Roca S.A[494](index=494&type=chunk) [D. Property, Plants and Equipment](index=68&type=section&id=D.%20Property%2C%20Plants%20and%20Equipment) Loma Negra owns seven cement manufacturing plants, fourteen concrete plants (Lomax brand), and one granitic aggregates plant in Argentina - As of December 31, 2024, Loma Negra owned seven cement manufacturing plants, fourteen concrete plants operating under the Lomax brand, and one granitic aggregates plant in Argentina[494](index=494&type=chunk) - The L'Amalí plant, expanded in December 2021, is now the largest cement plant in Argentina and one of the largest in Latin America, with an annual installed production capacity of approximately **4.0 million tons of clinker** and **5.6 million tons of cement**[500](index=500&type=chunk)[502](index=502&type=chunk)[519](index=519&type=chunk) - LomaSer, located near Buenos Aires, serves as a blending, distribution, and logistics center, connected to other production facilities via the Ferrosur Roca freight railway[504](index=504&type=chunk)[505](index=505&type=chunk) - The company's most recent material investment is related to the legal requirement of adjusting cement bags to the **25 kilograms** format, effective July 1, 2025[287](index=287&type=chunk)[520](index=520&type=chunk) [Our Production Facilities](index=68&type=section&id=Our%20Production%20Facilities) Loma Negra's production facilities are strategically located across Argentina, including cement plants in Barker, Catamarca, L'Amalí/LomaSer, Olavarría, Ramallo, San Juan, and Zapala Production Facilities as of December 31, 2024 | Production Facility | Type of Plant | Location | | :------------------ | :------------ | :--------- | | Barker | Cement | Benito Juárez | | Catamarca | Cement | El Alto | | L'Amalí | Cement | Olavarría | | LomaSer | Blending/Distribution | Cañuelas | | Olavarría | Cement | Olavarría | | Ramallo | Grinding Mill | Ramallo | | San Juan | Cement | San Juan | | Zapala | Cement | Zapala | | La Preferida | Aggregates | Olavarría | - The L'Amalí plant has two kilns with a daily capacity of approximately **12,000 tons of clinker** and cement production, storage, and bulk loading capabilities, including a vertical mill producing **500 tons per hour**[502](index=502&type=chunk) - LomaSer, a blending, distribution, and logistics center, operates approximately **40% of the company's total cement dispatches** and is strategically located near the City of Buenos Aires[504](index=504&type=chunk)[509](index=509&type=chunk) - The Barker and San Juan plants were reconverted into grinding and distribution centers in 2019, adapting their cost structures to this new operational scenario[498](index=498&type=chunk)[514](index=514&type=chunk) [Investments](index=73&type=section&id=Investments) Following the completion of the L'Amalí plant's second line in December 2021, which significantly increased cement production capacity, the company's capital expenditures have decreased - The completion of the L'Amalí plant's second line in December 2021 significantly reduced capital expenditures needs[519](index=519&type=chunk) - The company's only other material investment plan is related to the legal requirement of adjusting cement bags to the **25 kilograms** format[520](index=520&type=chunk) [ITEM 4A. UNRESOLVED STAFF COMMENTS](index=64&type=section&id=ITEM%204A.%20UNRESOLVED%20STAFF%20COMMENTS) This section states that there are no unresolved staff comments applicable to the company - The section is marked as 'Not applicable'[520](index=520&type=chunk) [ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS](index=64&type=section&id=ITEM%205.%20OPERATING%20AND%20FINANCIAL%20REVIEW%20AND%20PROSPECTS) This section provides a detailed analysis of Loma Negra's operating results, financial condition, and future prospects, highlighting the impact of macroeconomic conditions in Argentina [A. Operating Results](index=64&type=section&id=A.%20Operating%20Results) Loma Negra's operating results are heavily influenced by Argentina's macroeconomic conditions, including GDP growth, high inflation, and peso depreciation - The company's business is highly sensitive to macroeconomic factors such as GDP growth, with Argentina's economy decreasing by **1.7% in 2024** and **1.6% in 2023**[522](index=522&type=chunk)[523](index=523&type=chunk) Argentine Macroeconomic Data (2022-2024) | Indicator | 2024 | 2023 | 2022 | | :-------------------------------- | :----- | :----- | :----- | | Real GDP growth | (1.7)% | (1.6)% | 5.2% | | Average Ps./U.S. dollar exchange rate | 916.3 | 295.2 | 130.8 | | CPI inflation | 117.8% | 211.4% | 94.8% | | Private sector salary growth | 147.5% | 165.8% | 93.8% | - The company's financial statements are prepared in accordance with IFRS Accounting Standards and comprehensively recognize the effects of hyperinflation using IAS 29, with inflation rates of **117.8% in 2024**, **211.4% in 2023**, and **94.8% in 2022**[528](index=528&type=chunk)[529](index=529&type=chunk)[531](index=531&type=chunk) Cost of Sales Components (Percentage of Total Cost of Sales) | Component | 2024 (%) | 2023 (%) | 2022 (%) | | :-------------------------------- | :------- | :------- | :------- | | Salaries, wages and social security charges | 17.0 | 15.3 | 14.9 | | Thermal energy | 12.8 | 16.0 | 15.9 | | Depreciation | 12.4 | 10.1 | 12.3 | | Preservation and maintenance costs | 11.4 | 9.1 | 8.5 | | Freight | 9.4 | 10.5 | 10.7 | | Contractors | 9.3 | 7.9 | 6.9 | | Electrical power | 7.7 | 7.7 | 8.7 | | Raw materials (from other section) | 19.0 | 18.0 | 15.0 | [Principal Factors Affecting Our Results of Operations](index=64&type=section&id=Principal%20Factors%20Affecting%20Our%20Results%20of%20Operations) Loma Negra's operating results are significantly shaped by Argentina's volatile macroeconomic environment, including GDP fluctuations, high inflation, and peso depreciation - Argentina's GDP decreased by **1.7% in 2024** and **1.6% in 2023**, impacting cement demand due to the strong correlation between GDP growth and the construction industry[522](index=522&type=chunk)[523](index=523&type=chunk) - The peso depreciated by approximately **27.7% against the U.S. dollar in 2024**, following a **356.44% depreciation in 2023**, affecting foreign currency-denominated liabilities[538](index=538&type=chunk) - Thermal energy and electricity costs represented **21% of total cost of sales in 2024**, with the company mitigating risks through fuel diversification (including co-processing at **4.3% of thermal energy**) and renewable energy contracts (**58% of electrical power from renewable sources in 2024**)[545](index=545&type=chunk)[547](index=547&type=chunk)[549](index=549&type=chunk)[554](index=554&type=chunk) - Raw materials accounted for **19% of total cost of sales in 2024**, with the company primarily sourcing limestone from its own quarries to maintain cost competitiveness[559](index=559&type=chunk) [Financial Presentation and Accounting Practices](index=78&type=section&id=Financial%20Presentation%20and%20Accounting%20Practices) Loma Negra prepares its consolidated financial statements in accordance with IFRS Accounting Standards, with all figures restated in constant pesos due to Argentina's hyperinflationary economy (IAS 29) - Consolidated financial statements are prepared in accordance with IFRS Accounting Standards and are restated in constant pesos due to Argentina being a hyperinflationary economy, as per IAS 29[567](index=567&type=chunk)[568](index=568&type=chunk)[1138](index=1138&type=chunk)[1139](index=1139&type=chunk)[1142](index=1142&type=chunk) - Revenue from sales of goods is recognized when control is transferred to the customer, and for services, when rendered, with no significant financing components due to short credit terms (**20-35 days**)[590](index=590&type=chunk)[593](index=593&type=chunk)[1199](index=1199&type=chunk)[1202](index=1202&type=chunk) - The company applies the deferred tax method for income tax, considering temporary differences and tax loss carryforwards, with corporate tax rates ranging from **25% to 35%** and a **7% withholding tax on dividends**[608](index=608&type=chunk)[610](index=610&type=chunk)[1224](index=1224&type=chunk)[1225](index=1225&type=chunk)[1227](index=1227&type=chunk) - Critical accounting judgments and estimates are made for property, plant and equipment impairment, provisions for lawsuits and other contingencies, and environmental restoration obligations, which are subject to future events and market conditions[574](index=574&type=chunk)[575](index=575&type=chunk)[1331](index=1331&type=chunk)[1336](index=1336&type=chunk)[1338](index=1338&type=chunk)[1344](index=1344&type=chunk) [Components of Certain Statement of Profit or Loss and Other Comprehensive Income Line Items](index=93&type=section&id=Components%20of%20Certain%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income%20Line%20Items) This section details the components of Loma Negra's revenues, cost of sales, selling and administrative expenses, financial results, and income tax expense - Revenues are primarily derived from the sale of cement products, concrete, aggregates, and railway services, almost entirely denominated in pesos[697](index=697&type=chunk) Cost of Sales Components (2022-2024) | Component | 2024 (%) | 2023 (%) | 2022 (%) | | :-------------------------------- | :------- | :------- | :------- | | Salaries, wages and social security charges | 17.0 | 15.3 | 14.9 | | Thermal energy | 12.8 | 16.0 | 15.9 | | Depreciation | 12.4 | 10.1 | 12.3 | | Preservation and maintenance costs | 11.4 | 9.1 | 8.5 | | Freight | 9.4 | 10.5 | 10.7 | | Contractors | 9.3 | 7.9 | 6.9 | | Electrical power | 7.7 | 7.7 | 8.7 | | Packaging | 3.5 | 3.3 | 3.5 | | Taxes, contributions and commissions | 1.9 | 1.7 | 1.8 | | Transport and travelling expenses | 1.2 | 0.9 | 0.7 | | Fees and compensation for services | 1.0 | 1.5 | 1.9 | | Employee benefits | 0.7 | 0.5 | 0.4 | | Security | 0.7 | 0.5 | 0.5 | | Insurance | 0.4 | 0.4 | 0.3 | | Leases | 0.2 | 0.2 | 0.2 | | Communications | 0.1 | 0.1 | 0.1 | | Canon (concession fee) | 0.1 | 0.1 | 0.1 | | Data processing | 0.1 | 0.1 | 0.1 | | Water, natural gas and energy services | 0.0 | 0.0 | 0.0 | | Tolls | 0.0 | 0.0 | 0.0 | | Others | 1.7 | 1.2 | 1.4 | | **Production expenses** | **91.7** | **87.0** | **88.8** | | **Cost of sales** | **100.0** | **100.0** | **100.0** | Selling and Administrative Expenses Components (2022-2024) | Component | 2024 (%) | 2023 (%) | 2022 (%) | | :-------------------------------- | :------- | :------- | :------- | | Salaries, wages and social security charges | 26.2 | 25.0 | 25.1 | | Taxes, contributions and commissions | 20.5 | 21.5 | 24.3 | | Freight | 12.3 | 12.1 | 14.7 | | Fees and compensation for services | 8.3 | 8.6 | 6.6 | | Managers, directors and trustees' fees | 6.6 | 7.3 | 7.7 | | Depreciation and amortization | 5.5 | 5.2 | 6.5 | | Advertising expenses | 5.4 | 5.5 | 4.6 | | Data processing | 5.0 | 3.6 | 2.5 | | Insurance | 3.8 | 4.5 | 2.5 | | Others | 1.8 | 2.2 | 1.7 | | Transport and travelling expenses | 1.6 | 1.4 | 1.3 | | Employee benefits | 1.4 | 1.4 | 0.8 | | Leases | 0.7 | 0.4 | 0.3 | | Communications | 0.4 | 0.5 | 0.8 | | Preservation and maintenance costs | 0.3 | 0.3 | 0.2 | | Allowance for doubtful accounts | 0.1 | 0.3 | 0.2 | | Water, natural gas and energy services | 0.1 | 0.0 | 0.0 | | Security | 0.0 | 0.2 | 0.2 | | **Total selling and administrative expenses** | **100.0** | **100.0** | **100.0** | [Results of Operations](index=95&type=section&id=Results%20of%20Operations) In 2024, Loma Negra's net profit surged by **628.8% to Ps. 153,627 million**, with net margin expanding to **22.0%**, primarily due to lower costs and improved financial results Consolidated Statement of Profit or Loss and Other Comprehensive Income (2023-2024) | Metric | 2024 (Ps. millions) | 2023 (Ps. millions) | Variation (Amount) | Variation (%) | | :-------------------------------- | :------------------ | :------------------ | :----------------- | :------------ | | Revenue | 699,178.7 | 919,312.7 | (220,134.0) | (23.9) | | Cost of sales | (512,197.7) | (688,685.3) | 176,487.6 | (25.6) | | Gross profit | 186,981.0 | 230,627.4 | (43,646.4) | (18.9) | | Selling and administrative expenses | (73,175.4) | (84,199.9) | 11,024.5 | (13.1) | | Other gains and losses | 4,555.2 | 1,999.2 | 2,556.0 | 127.9 | | Tax on debits and credits to bank accounts | (7,420.4) | (10,183.8) | 2,763.4 | (27.1) | | Finance costs, net | 138,611.3 | (100,312.4) | 238,923.7 | 238.2 | | Profit before taxes | 249,551.8 | 37,930.5 | 211,621.3 | 557.9 | | Income tax expense | (95,925.3) | (16,849.9) | (79,075.4) | 469.0 | | **Net profit** | **153,626.5** | **21,080.6** | **132,545.9** | **628.8** | Consolidated Statement of Profit or Loss and Other Comprehensive Income (2022-2023) | Metric | 2023 (Ps. millions) | 2022 (Ps. millions) | Variation (Amount) | Variation (%) | | :-------------------------------- | :------------------ | :------------------ | :----------------- | :------------ | | Revenue | 919,312.7 | 984,191.5 | (64,878.8) | (6.6) | | Cost of sales | (688,685.3) | (718,413.3) | 29,728.0 | (4.1) | | Gross profit | 230,627.4 | 265,778.2 | (35,150.8) | (13.2) | | Selling and administrative expenses | (84,199.9) | (84,838.3) | 638.4 | (0.8) | | Other gains and losses | 1,999.2 | 22,957.7 | (20,958.5) | (91.3) | | Tax on debits and credits to bank accounts | (10,183.8) | (9,868.5) | (315.3) | 3.2 | | Finance costs, net | (100,312.4) | (119,414.1) | 19,101.7 | (16.0) | | Profit before taxes | 37,930.5 | 74,615.0 | (36,684.5) | (49.2) | | Income tax expense | (16,850.0) | (62,361.9) | 45,511.9 | (73.0) | | **Net profit** | **21,080.6** | **12,253.1** | **8,827.5** | **72.0** | [B. Liquidity and Capital Resources](index=102&type=section&id=B.%20Liquidity%20and%20Capital%20Resources) Loma Negra's liquidity and capital resources are managed through cash flow generation, debt management, and capital expenditures - The company believes its cash and cash equivalents, cash from operations, and available borrowings will be adequate to meet capital expenditure and liquidity needs for at least the next **12 months**[748](index=748&type=chunk) Cash Flows from Activities (2022-2024) | Activity | 2024 (Ps. millions) | 2023 (Ps. millions) | 2022 (Ps. millions) | | :-------------------------------- | :------------------ | :------------------ | :------------------ | | Net cash generated by operating activities | 124,718.1 | 185,164.9 | 212,676.1 | | Net cash used in investing activities | (72,893.9) | (78,014.6) | (31,987.1) | | Net cash used in financing activities | (48,265.9) | (89,469.4) | (168,053.4) | | Cash and cash equivalents at end of year | 8,553.4 | 14,664.6 | 33,302.5 | Total Outstanding Borrowings (2023-2024) | Category | 2024 (Ps. millions) | 2023 (Ps. millions) | | :-------------------------- | :------------------ | :------------------ | | Total outstanding borrowings | 170,901 | 320,919 | | Short-term borrowings | 100,680 | 81,062 | | Long-term borrowings | 70,221 | 239,857 | | Foreign currency-denominated | 156,366 | 242,499 | | Peso-denominated | 14,536 | 78,419 | Selected Financial Ratios (2022-2024) | Ratio | 2024 | 2023 | 2022 | | :-------------------------------- | :--- | :--- | :--- | | Liquidity (Current assets / Current liabilities) | 1.02 | 1.09 | 0.97 | | Solvency (Shareholder's equity / Total liabilities) | 1.29 | 0.85 | 1.33 | | Non-current assets to total assets ratio | 0.81 | 0.80 | 0.80 | | Profitability (Net profit / Average shareholder's equity) | 0.21 | 0.03 | 0.01 | [Cash Flows](index=103&type=section&id=Cash%20Flows) In 2024, net cash generated by operating activities was **Ps. 124,718 million**, primarily from profit before tax, partially offset by increases in inventories and trade receivables - Net cash generated by operating activities was **Ps. 124,718 million in 2024**, down from **Ps. 185,165 million in 2023**, mainly due to changes in inventories and trade accounts receivable[751](index=751&type=chunk)[752](index=752&type=chunk) - Net cash used in investing activities was **Ps. 72,894 million in 2024**, primarily for the acquisition of property, plant, and equipment (**Ps. 73,048 million**)[752](index=752&type=chunk) - Net cash used in financing activities was **Ps. 48,266 million in 2024**, mainly due to interest paid (**Ps. 61,591 million**), partially offset by net proceeds from borrowings (**Ps. 15,656 million**)[753](index=753&type=chunk) [Indebtedness and Financing Strategy](index=104&type=section&id=Indebtedness%20and%20Financing%20Strategy) As of December 31, 2024, Loma Negra's total outstanding consolidated borrowings were **Ps. 170,901 million**, with **59% short-term** and **91% denominated in U.S. dollars** - Total outstanding consolidated borrowings as of December 31, 2024, were **Ps. 170,901 million**, comprising **59% short-term** and **41% long-term debt**[762](index=762&type=chunk) - Approximately **91% of consolidated borrowings** were denominated in U.S. dollars, with **9% in pesos**. **9% of loans** accrued interest at a variable rate, and **91% at a fixed rate**[763](index=763&type=chunk) - The average maturity of the company's indebtedness was **0.9 years** as of December 31, 2024[765](index=765&type=chunk) - Debt contracts do not include restrictive clauses requiring the maintenance of specific financial ratios or non-financial commitments[766](index=766&type=chunk) [Contractual Commitments](index=106&type=section&id=Contractual%20Commitments) As of December 31, 2024, Loma Negra had total contractual obligations of **Ps. 335,948.46 million**, with the majority (**Ps. 261,410.09 million**) due within one year Contractual Obligations as of December 31, 2024 (in millions of Ps.) | Category | Total | Less than 1 year | 1-3 years | 3-5 years | More than 5 years | | :-------------------------- | :-------- | :--------------- | :-------- | :-------- | :---------------- | | Financial borrowings | 170,901.20 | 100,680.04 | 70,221.17 | - | - | | Accounts payable | 93,590.80 | 93,590.80 | - | - | - | | Taxes payable | 46,844.68 | 46,844.68 | - | - | - | | Salaries and social security contributions | 19,418.66 | 17,909.95 | 1,508.71 | - | - | | Lease liabilities | 3,186.64 | 1,388.36 | 1,782.34 | 15.95 | - | | Severance payment plans | 639.22 | 479.26 | 155.16 | 4.32 | 0.48 | | Other debts | 1,367.25 | 517.01 | - | - | 850.24 | | **Total** | **335,948.46** | **261,410.09** | **73,667.38** | **20.27** | **850.72** | [Selected Ratios](index=107&type=section&id=Selected%20Ratios) Loma Negra's liquidity ratio was **1.02 in 2024**, indicating sufficient current assets to cover current liabilities Selected Financial Ratios (2022-2024) | Ratio | 2024 | 2023 | 2022 | | :-------------------------------- | :--- | :--- | :--- | | Liquidity (Current assets / Current liabilities) | 1.02 | 1.09 | 0.97 | | Solvency (Shareholder's equity / Total liabilities) | 1.29 | 0.85 | 1.33 | | Non-current assets to total assets ratio | 0.81 | 0.80 | 0.80 | | Profitability (Net profit / Average shareholder's equity) | 0.21 | 0.03 | 0.01 | [Supply Contracts](index=107&type=section&id=Supply%20Contracts) Loma Negra maintains long-term supply agreements for key inputs, including a **15-year contract** for ground granulated blast-furnace slag and **20-year contracts** for wind-sourced electric power - The company has a **15-year agreement** with Siderar S.A.I.C. for the supply of ground granulated blast-furnace slag, entered into in 2007[772](index=772&type=chunk) - Long-term contracts with Genneia S.A. (2016) and Aluar Aluminio Argentino S.A.I.C. (2018) for wind-sourced electric power ensure compliance with renewable energy obligations, with the company exceeding requirements by sourcing approximately **58% of its energy from renewable sources**[774](index=774&type=chunk) [C. Research and Development, Patents and Licenses, etc.](index=107&type=section&id=C.%20Research%20and%20Development%2C%20Patents%20and%20Licenses%2C%20etc.) Loma Negra holds **120 registered trademarks** in Argentina, with one renewal pending, and additional registrations in Bolivia, Brazil, Chile, Paraguay, and Uruguay - Loma Negra holds **120 registered trademarks** in Argentina, with one renewal pending, and has also registered trademarks in Bolivia, Brazil, Chile, Paraguay, and Uruguay[775](index=775&type=chunk)[776](index=776&type=chunk) - The company does not own any registered patents, industrial models, or designs, and has no pending litigation related to trademark matters[775](index=775&type=chunk)[776](index=776&type=chunk) [Intellectual Property](index=107&type=section&id=Intellectual%20Property) Loma Negra manages its intellectual property through **120 registered trademarks** in Argentina and other South American countries, with no registered patents - Loma Negra holds **120 registered trademarks**, with one renewal pending, and has registered trademarks in Bolivia, Brazil, Chile, Paraguay, and Uruguay[775](index=775&type=chunk)[776](index=776&type=chunk) - The company does not own any registered patents, industrial models, or designs[775](index=775&type=chunk) - Loma Negra is involved in two administrative opposition proceedings against third-party trademarks and owns **13 internet domains**[777](index=777&type=chunk) [D. Trend Information](index=107&type=section&id=D.%20Trend%20Information) Argentina's economy faced significant challenges in 2023, including a severe drought and a federal budget deficit, with CPI inflation reaching **211.4%** - Argentina's CPI inflation was **211.4% in 2023** and **117.8% in 2024**, while the peso depreciated by **356.44% in 2023** and **27.7% in 2024**[781](index=781&type=chunk) - In 2024, Argentina's GDP contracted by **2.8%**, and cement dispatches decreased by **24% year-on-year to 9.56 million tons**, the lowest annual level since 2009[783](index=783&type=chunk)[1487](index=1487&type=chunk) - Forecasts for the Argentine economy estimate an approximate GDP growth of **4.5% year-on-year for 2025**, contingent on the consolidation of the economic model and its ability to generate confidence[1487](index=1487&type=chunk) - The BCRA's U.S. dollar reserves were low at **US$25.45 billion** on April 1, 2025, but a new **US$12 billion** disbursement on April 15, 2025, increased international reserves to **US$36,799 million**[782](index=782&type=chunk)[1001](index=1001&type=chunk) [E. Critical Accounting Estimates](index=108&type=section&id=E.%20Critical%20Accounting%20Estimates) This section states that there are no critical accounting estimates applicable to the company - The section is marked as 'Not applicable'[785](index=785&type=chunk) [ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES](index=108&type=section&id=ITEM%206.%20DIRECTORS%2C%20SENIOR%20MANAGEMENT%20AND%20EMPLOYEES) This section details Loma Negra's corporate governance structure, including its Board of Directors and Executive Officers, their compensation, and various incentive programs [A. Directors and Senior Management](index=108&type=section&id=A.%20Directors%20and%20Senior%20Management) Loma Negra's Board of Directors, elected annually, consists of a minimum of three and up to fourteen members, responsible for policies and supervision - The Board of Directors consists of a minimum of three and up to fourteen members, elected annually, and is responsible for determining policies and supervising executive officers[787](index=787&type=chunk)[788](index=788&type=chunk) Board of Directors Members as of December 31, 2024 | Name | Age | Position | Independent | | :------------------------ | :-- | :--------- | :---------- | | Paulo Diniz | 67 | President | No | | Sergio Damián Faifman | 50 | Vice-President | No | | Sergio Daniel Alonso | 62 | Director | Yes | | Cesar Javier Graña | 54 | Director | Yes | | Javier Enrique Patron | 62 | Director | No | | Laura Gé | 57 | Director | Yes | | Humberto Junqueira de Farias | 56 | Director | No | Executive Officers as of April 2025 | Name | Year of Birth | Position | | :-------------------- | :------------ | :------------------------------------ | | Sergio Damián Faifman | 1974 | Chief Executive Officer | | Marcos Isabelino Gradin | 1972 | Chief Financial Officer | | Gerardo Oscar Diez | 1967 | Commercial and Concrete Director | | Hector Fabian Gerez | 1968 | Ferrosur Roca S.A. General Director | | Lucrecia Loureiro | 1981 | Human Resources, Sustainability and Legal Director | | Lucas Amchite | 1975 | Industrial Director | [B. Compensation](index=112&type=section&id=B.%20Compensation) Executive officers receive cash compensation (base salary and bonus) and participate in welfare benefit programs, with aggregate cash compensation of **Ps. 3,608 million in 2024** - Aggregate cash compensation for senior management was **Ps. 3,608 million in 2024** and **Ps. 4,728 million in 2023**, with an additional **Ps. 768 million** and **Ps. 1,518 million** accrued for long-term incentive programs, respectively[807](index=807&type=chunk) - The company adopted a Clawback Policy effective November 8, 2023, to recover erroneously awarded incentive-based compensation from executive officers following accounting restatements[816](index=816&type=chunk) - The Phantom Stock Plan was terminated in February 2021, but existing grants remain in force. New Stock Compensation Plans, established in 2021, involve granting ordinary shares/ADSs or their cash equivalent (option added in November 2024) based on permanence or Total Shareholder Return (TSR)[818](index=818&type=chunk)[827](index=827&type=chunk)[828](index=828&type=chunk)[831](index=831&type=chunk)[1310](index=1310&type=chunk) - In January 2025, the cash equivalent to **27,336 ADRs** was paid to employees under the Stock Compensation Plan, and in March 2025, a cash payment equivalent to **22,952 ADRs** was made under the TSR Stock Compensation Plan[833](index=833&type=chunk)[837](index=837&type=chunk) [C. Board Practices](index=115&type=section&id=C.%20Board%20Practices) Directors are obligated to perform duties with loyalty and diligence, being jointly and severally liable for improper performance or violations - Directors are jointly and severally liable for improper performance of duties, violations of law or bylaws, and damages caused by fraud, abuse of authority, or gross negligence[839](index=839&type=chunk)[840](index=840&type=chunk) - The Supervisory Committee, consisting of three members, supervises management's compliance with Argentine law and bylaws, and reviews financial statements[848](index=848&type=chunk) - The Audit Committee, composed of three independent directors, oversees financial statements, internal controls, risk management, ethics, and external/internal audits[850](index=850&type=chunk)[851](index=851&type=chunk) - Other key committees include the Disclosure Policy Committee, Securities Operations Approval Committee, Ethics and Compliance Committee, People and Governance Committee, Results, Finance and Strategy Committee, and Risk and Reputation Committee, each with specific oversight responsibilities[852](index=852&type=chunk)[853](index=853&type=chunk)[855](index=855&type=chunk)[856](index=856&type=chunk)[858](index=858&type=chunk)[859](index=859&type=chunk) [D. Employees](index=119&type=section&id=D.%20Employees) As of December 31, 2024, Loma Negra had a total of **2,821 employees** across its business segments - As of December 31, 2024, Loma Negra had a total of **2,821 employees**[860](index=860&type=chunk) Employees by Business Segment as of December 31 | Business Segment | 2024 | 2023 | 2022 | | :--------------- | :--- | :--- | :--- | | Cement | 1,424 | 1,415 | 1,421 | | Concrete | 263 | 285 | 278 | | Aggregates | 71 | 74 | 63 | | Railroad | 1,028 | 1,077 | 1,090 | | Others | 35 | 34 | 34 | | **Total** | **2,821** | **2,885** | **2,886** | - The company has collective bargaining agreements with unions in the cement (AOMA), railway transportation (APDFA, La Fraternidad, Unión Ferroviaria), chemical (FESTIQyPRA), and construction (UOCRA) industries[860](index=860&type=chunk) - Loma Negra has not experienced any significant labor conflicts or lost working days due to union actions in 2024[860](index=860&type=chunk) [E. Share Ownership](index=119&type=section&id=E.%20Share%20Ownership) None of Loma Negra's directors or executive officers beneficially own one percent or more of the company's ordinary shares as of the date of this annual report - None of the company's directors or executive officers beneficially own one percent or more of its ordinary shares as of the date of this annual report[862](index=862&type=chunk) [F. Disclosure of a Registrant's Action to Recover Erroneously Awarded Compensation](index=119&type=section&id=F.%20Disclosure%20of%20a%20Registrant%27s%20Action%20to%20Recover%20Erroneously%20Awarded%20Compensation) This section states that there is no disclosure of a registrant's action to recover erroneously awarded compensation applicable to the company - The section is marked as 'Not Applicable'[863](index=863&type=chunk) [ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS](index=119&type=section&id=ITEM%207.%20MAJOR%20SHAREHOLDERS%20AND%20RELATED%20PARTY%20TRANSACTIONS) This section identifies Loma Negra's major shareholders and details transactions with related parties [A. Major Shareholders](index=119&type=section&id=A.%20Major%20Shareholders) As of March 31, 2025, IC Trading Inversiones Argentina, S.L. is Loma Negra's major shareholder, beneficially owning **52.1% of outstanding ordinary shares** Beneficial Ownership of Ordinary Shares as of March 31, 2025 | Name of Beneficial Owner | Shares Beneficially Owned | Percentage of Capital Stock | | :----------------------- | :------------------------ | :-------------------------- | | IC Trading Inversiones Argentina, S.L. | 304,233,740 | 52.1% | | ANSES | 31,076,151 | 5.3% | | Directors and Executive Officers as a Group | * | * | - IC Trading Inversiones Argentina, S.L. is the controlling shareholder, owning **52.14% of the company's share capital** as of the date of this annual report[873](index=873&type=chunk) - The controlling shareholder, Intercement Participações S.A., filed for judicial reorganization on December 3, 2024, which could result in a change of control for Loma Negra[875](index=875&type=chunk) [Significant Changes in Percentage Ownership](index=120&type=section&id=Significant%20Changes%20in%20Percentage%20Ownership) There have been internal restructurings within Loma Negra's controlling shareholder group, including the transfer of ownership from Caue Austria Holding GmbH to Intercement Trading e Inversiones, S.A. - On January 21, 2020, Caue Austria Holding GmbH transferred its **304,233,740 ordinary shares** to Intercement Trading e Inversiones, S.A., which then transferred them to its subsidiary, Intercement Trading e Inversiones Argentina, S.L. on January 6, 2021[869](index=869&type=chunk)[872](index=872&type=chunk) - On June 4, 2020, Intercement Trading e Inversiones S.A. pledged **52.14% of Loma Negra's capital stock** as collateral for debenture obligations of its indirect shareholder, Intercement Participações S.A., and its subsidiary, Intercement Brasil S.A[870](index=870&type=chunk) - The controlling shareholder, Intercement Participações S.A., filed for judicial reorganization on December 3, 2024, after extrajudicial restructuring efforts failed, which may result in a change of control for Loma Negra[875](index=875&type=chunk) [B. Related Party Transactions](index=121&type=section&id=B.%20Related%20Party%20Transactions) Loma Negra engages in arm's length transactions with its shareholders and controlled companies, primarily for cost-sharing related to administrative functions and service provisions - The company enters into arm's length transactions with shareholders and controlled companies for cost-sharing and administrative functions, ensuring compliance with conflict of interest laws[876](index=876&type=chunk)[877](index=877&type=chunk) Related Party Balances as of December 31 (Ps. thousands) | Related Party | 2024 (Ps. thousands) | 2023 (Ps. thousands) | | :-------------------------------- | :------------------- | :------------------- | | InterCement Brasil S.A. - Accounts payable | (171,275) | (307,294) | | InterCement Trading e Inversiones S.A. - Other receivables | 2,163,306 | 3,688,455 | | InterCement Trading e Inversiones S.A. - Accounts payable | (944,321) | (1,694,215) | | Intercement Participações S.A. - Other receivables | 2,600,140 | 4,283,857 | | Intercement Participações S.A. - Accounts payable | (2,269,292) | (4,644,204) | - A know-how offer letter from InterCement Participações S.A. for technical know-how (**1% of revenues**) ended in August 2023, and a service provision agreement from Loma Negra to InterCement Participacoes S.A. (cost plus **8% return**) expired in September 2023[879](index=879&type=chunk)[881](index=881&type=chunk) [Other Transactions](index=121&type=section&id=Other%20Transactions) Loma Negra had a know-how transfer agreement with InterCement Participações S.A. (**1% of revenues**) that ended in August 2023, and a service provision agreement to InterCement Group that expired in September 2023 - A know-how offer letter from InterCement Participações S.A. for technical know-how (**1% of revenues**) was accepted by Loma Negra in August 2020 and ended in August 2023[879](index=879&type=chunk) - Loma Negra provided services to InterCement Participacoes S.A. or other InterCement Group companies, with fees representing net costs plus an **8% arm's length return**, under an agreement that expired in September 2023[881](index=881&type=chunk) [C. Interests of Experts and Counsel](index=122&type=section&id=C.%20Interests%20of%20Experts%20and%20Counsel) This section states that there are no interests of experts and counsel applicable to the company - The section is marked as 'Not applicable'[882](index=882&type=chunk) [ITEM 8. FINANCIAL INFORMATION](index=122&type=section&id=ITEM%208.%20FINANCIAL%20INFORMATION) This section provides an overview of Loma Negra's consolidated financial statements, including details on legal proceedings and the company's dividend policy [A. Consolidated Statements and Other Financial Information](index=122&type=section&id=A.%20Consolidated%20Statements%20and%20Other%20Financial%20Information) Loma Negra's consolidated financial statements are included in this annual report, summarizing ongoing litigations and the framework governing dividend declarations and payments - The company's audited consolidated financial statements for the years ended December 31, 2024, 2023, and 2022 are included in this annual report[883](index=883&type=chunk) [Legal Proceedings](index=122&type=section&id=Legal%20Proceedings) Loma Negra is party to **378 legal and administrative proceedings**, with a total amount in controversy of **Ps. 15,185 million** as of December 31, 2024, for which a provision of **Ps. 3,796 million** has been established - As of December 31, 2024, Loma Negra was party to **378 legal and administrative proceedings**, with a total amount in controversy of approximately **Ps. 15,185 million**[884](index=884&type=chunk)[885](index=885&type=chunk) Summary of Legal and Administrative Proceedings as of December 31, 2024 | Type of Proceedings | Number of proceedings | Total Claims (in millions of Ps.) | Total Provision

Group 1 - The company is a leader in the Argentine cement industry, attributed to its dominant market position and vertical integration of products and services [1] - The long-term attractiveness of the company is emphasized, indicating solid potential for growth [1]

Group 1 - The investment strategy focuses on long-only investment, evaluating companies from an operational and buy-and-hold perspective, rather than market-driven dynamics [1] - The articles emphasize understanding the long-term earnings power of companies and the competitive dynamics within their industries [1] - The majority of recommendations will be holds, indicating a cautious approach to market conditions and a belief that only a small fraction of companies are suitable for buying at any given time [1] Group 2 - The articles aim to provide important information for future investors and introduce a healthy skepticism towards a generally bullish market [1] - There is a clear distinction made between the author's opinions and professional investment advice, highlighting the need for readers to conduct their own due diligence [2][3]

Financial Data and Key Metrics Changes - The company experienced a 31% decline in sales during the first half of 2024, which improved to a year-on-year decline of 17% in the second half of the year [4]. Business Line Data and Key Metrics Changes - The construction sector faced significant challenges in 2024, impacting cement consumption due to key economic variables and the suspension of many public works projects [5]. Market Data and Key Metrics Changes - The overall industry saw a decline in volumes by 24% to 25% in the previous year, but the company anticipates a two-digit year-on-year increase in volumes for 2025 if the last part of 2024's volumes are maintained [13][15]. Company Strategy and Development Direction - The company is focusing on maintaining pricing dynamics similar to the previous years, with expectations that prices will align with inflation, assuming inflation remains above the devaluation of the peso [9]. Management Comments on Operating Environment and Future Outlook - Management acknowledged the challenging environment in 2024 but expressed optimism for 2025, citing potential private projects that may commence soon [15]. Other Important Information - The Board decided not to pay dividends in 2024 due to the drop in volumes and uncertainty in the market, contrasting with the dividend payments made in 2022 and 2023 [18]. Q&A Session Summary Question: Pricing strategy for 2025 - Management indicated that pricing dynamics in 2025 would likely mirror those of the last couple of years, with a potential deceleration of inflation allowing for more spaced price increments [9]. Question: Volume expectations for 2025 - The company expects a two-digit year-on-year increase in volumes for 2025, contingent on maintaining the volumes from the latter part of 2024 [15]. Question: Dividend expectations for 2025 - The Board did not move forward with dividends in 2024 due to market conditions, and the decision for 2025 is still under analysis [18]. Question: Cost structure and margin opportunities for 2025 - Management noted improvements in energy inputs and indicated that they are assessing their cost structure for potential margin increases [24]. Question: CapEx guidance for 2025 - The company plans to focus on maintenance CapEx for 2025, estimating maintenance costs between $55 million and $60 million [26]. Question: Remaining CapEx for specific projects - The remaining CapEx for the 25-kilogram project is approximately $22 million [31].

Financial Performance - Consolidated Adjusted EBITDA margin reached 29.0%, with an expansion of 623 bps Year-over-Year (YoY) from 22.8%[11] - Full Year 2024 (FY24) EBITDA was 181.0 billion Argentine Pesos (Ps), equivalent to 198 million US dollars (US$), with a margin of 25.9%, up 211 bps[11] - Net Profit for FY24 reached 153.7 billion Ps[11] - Net revenues reached 174.2 billion Ps, down 19.5%, equivalent to 170 million US$[12] - Adjusted EBITDA stood at 50.6 billion Ps, up 2.4%, equivalent to 50 million US$[12] - Net Profit was 22.1 billion Ps[12] Sales and Volumes - Cement, masonry & lime sales decreased 19.9% YoY, with volumes contracting 14.1%[21] - Concrete sales were down 26.9% YoY, with volumes decreasing 14.4%[21] - Railroad sales decreased 3.2% YoY, while volumes increased 3.1%[21] - Aggregates sales decreased 34.2% YoY, with volumes down 3.1%[21] Balance Sheet and Cash Flow - Net Debt stood at 157 million US$, representing a Net Debt/Last Twelve Months (LTM) Adjusted EBITDA ratio of 0.89x[11] - Cash position and Investments were 8.6 billion Ps as of the end of 4Q24[34] - Net cash generated by operating activities in 4Q24 was 47.8 billion Ps[34]

[Performance Overview](index=1&type=section&id=Performance%20Overview) The company navigated a challenging year, achieving significant EBITDA margin expansion and net profit turnaround while improving leverage [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO Sergio Faifman highlighted resilience and market leadership in a challenging 2024, noting significant 4Q24 EBITDA margin expansion and anticipating gradual recovery - The company navigated a challenging 2024 characterized by a downturn in the construction industry, reaffirming its resilience, adaptability, and leadership in Argentina's cement market[5](index=5&type=chunk) - In 4Q24, the company achieved a significant **EBITDA margin expansion of over 600 basis points**, driven by a focus on improving efficiency amidst declining volumes[6](index=6&type=chunk) - Management views 2024 as a transition year, with the most difficult period concluded and an expectation of gradual recovery strengthening alongside the overall economy[7](index=7&type=chunk) [Key Highlights](index=1&type=section&id=Key%20Highlights) FY24 saw revenue and EBITDA declines but margin expansion and net profit turnaround, with 4Q24 showing EBITDA growth and margin surge, improving leverage to 0.89x FY24 Key Financial Metrics (YoY) | Metric | FY24 | % Change YoY | | :--- | :--- | :--- | | Net Revenue | Ps. 699,179 million | -23.9% | | Adjusted EBITDA | Ps. 180,987 million | -17.2% | | Adjusted EBITDA Margin | 25.9% | +211 bps | | Net Profit | Ps. 153,627 million | +628.8% | 4Q24 Key Financial Metrics (YoY) | Metric | 4Q24 | % Change YoY | | :--- | :--- | :--- | | Net Revenue | Ps. 174,173 million | -19.5% | | Adjusted EBITDA | Ps. 50,589 million | +2.4% | | Adjusted EBITDA Margin | 29.0% | +623 bps | | Net Profit (Loss) | Ps. 22,118 million | n/a (vs. Loss of Ps. 43,963M) | - The **Net Debt/LTM Adjusted EBITDA ratio significantly improved**, decreasing to **0.89x** from 1.40x in FY23, reflecting a US$20 million reduction in indebtedness during the quarter[8](index=8&type=chunk)[9](index=9&type=chunk) [Operational Performance](index=4&type=section&id=Overview%20of%20Operations) This section analyzes sales volumes across key segments, highlighting declines in construction materials and growth in the Railroad segment [Sales Volumes Analysis](index=4&type=section&id=Sales%20Volumes) 4Q24 saw declines in Cement, Concrete, and Aggregates volumes, with bagged cement showing resilience and Railroad volumes growing, while FY24 experienced broad-based declines Sales Volumes by Segment (YoY % Change) | Segment | 4Q24 % Chg. | FY24 % Chg. | | :--- | :--- | :--- | | Cement, masonry & lime | -14.1% | -23.7% | | Concrete | -14.4% | -31.8% | | Railroad | +3.1% | -13.4% | | Aggregates | -3.1% | -24.8% | - In 4Q24, bagged cement showed stronger resilience, declining less than the industry average, while bulk cement was more affected by low activity in large private construction projects and public works[12](index=12&type=chunk) - The Railroad segment's volume increased by **3.1% in 4Q24**, as higher transported volumes of grains and fracsand more than offset the decline in construction materials[14](index=14&type=chunk) - For FY24, the decline in volumes was most pronounced in **Concrete (-31.8%)** and **Aggregates (-24.8%)**, heavily impacted by the economic slowdown and halt in public works[16](index=16&type=chunk) [Detailed Financial Review](index=6&type=section&id=Review%20of%20Financial%20Results) This section provides an in-depth analysis of the company's profit and loss, financial position, and cash flow performance [Profit & Loss Analysis](index=6&type=section&id=Profit%20%26%20Loss%20Analysis) Despite revenue drops, 4Q24 gross profit remained stable with significant margin expansion due to cost controls, leading to a net profit turnaround [Net Revenues](index=6&type=section&id=Net%20Revenues) 4Q24 net revenue fell 19.5% YoY, primarily due to declines in Cement, Concrete, and Aggregates, with FY24 also seeing a significant overall decrease - 4Q24 net revenue decreased **19.5% YoY** to **Ps. 174,173 million**, mainly from the Cement segment's performance[19](index=19&type=chunk) - By segment, 4Q24 YoY revenue changes were: Cement **-19.9%**, Concrete **-26.9%**, Aggregates **-34.2%**, and Railroad **-3.2%**[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - FY24 net revenue declined **23.9%** to **Ps. 699,179 million**, driven by weaker performance in the core Cement business amid an economic contraction[24](index=24&type=chunk) [Cost of Sales and Gross Profit](index=6&type=section&id=Cost%20of%20sales,%20and%20Gross%20profit) 4Q24 cost of sales decreased significantly, outpacing revenue decline due to lower volumes and strict cost management, resulting in substantial gross profit margin expansion - Cost of sales in 4Q24 fell **26.5% YoY**, driven by lower sales volumes, reduced depreciation, and strict cost management, including favorable energy contracts and lower freight and salary expenses[25](index=25&type=chunk) - Gross profit margin in 4Q24 expanded by **640 basis points** to **32.6%**, despite the decline in sales volumes[27](index=27&type=chunk) - For the full fiscal year 2024, gross profit margin expanded by **166 basis points** to **26.7%**[27](index=27&type=chunk) [Selling and Administrative Expenses (SG&A)](index=8&type=section&id=Selling%20and%20Administrative%20Expenses) 4Q24 SG&A expenses decreased due to cost reductions, but increased as a percentage of sales due to lower revenue, with FY24 also showing a decrease - 4Q24 SG&A decreased **3.9%** to **Ps. 20,847 million** due to lower turnover tax, freight, and insurance costs[28](index=28&type=chunk) - As a percentage of sales, SG&A rose by **195 basis points** to **12.0%** in 4Q24, a consequence of the lower top line[28](index=28&type=chunk) [Adjusted EBITDA & Margin](index=8&type=section&id=Adjusted%20EBITDA%20%26%20Margin) 4Q24 Adjusted EBITDA grew with significant margin expansion, primarily driven by the Cement segment, despite negative margins in Concrete and Aggregates, with FY24 also seeing margin expansion Adjusted EBITDA & Margin (4Q24 vs 4Q23) | Metric | 4Q24 | 4Q23 | % Chg. | | :--- | :--- | :--- | :--- | | Adjusted EBITDA | Ps. 50,589 million | Ps. 49,385 million | +2.4% | | Adjusted EBITDA Margin | 29.0% | 22.8% | +623 bps | - The Cement segment's Adjusted EBITDA margin expanded by **815 basis points** to **33.7%** in 4Q24[31](index=31&type=chunk) - The Concrete and Aggregates segments' Adjusted EBITDA margins contracted to **-6.1%** and **-8.9%** respectively in 4Q24[32](index=32&type=chunk) [Finance Costs-Net and Net Profit](index=10&type=section&id=Finance%20Costs-Net%20and%20Net%20Profit) The company reported a significant net financial gain in 4Q24, reversing a prior-year loss due to lower exchange rate impacts, leading to a substantial net profit for the quarter and full year - A net financial gain of **Ps. 857 million** was reported in 4Q24, compared to a loss of **Ps. 81,281 million** in 4Q23, mainly due to a lower impact from exchange rate differences[36](index=36&type=chunk) - 4Q24 Net Profit was **Ps. 22,118 million**, reversing a **Ps. 43,963 million** loss in 4Q23, driven by improved operational performance and a better financial result[39](index=39&type=chunk) - FY24 Net Income Attributable to Owners rose to **Ps. 153,810 million** from **Ps. 22,441 million** in FY23, primarily due to lower net financial costs and exchange rate impacts[41](index=41&type=chunk) [Financial Position and Cash Flow](index=10&type=section&id=Financial%20Position%20and%20Cash%20Flow) Loma Negra significantly strengthened its balance sheet by reducing net debt and improving its leverage ratio, while generating substantial operating cash flow [Capitalization and Debt](index=10&type=section&id=Capitalization%20and%20Debt) At year-end 2024, total net debt decreased significantly, leading to a substantial improvement in the Net Debt/LTM Adjusted EBITDA ratio, with a well-balanced, primarily USD-denominated debt Debt Profile (as of Dec 31, 2024) | Metric | Value | Comparison (vs. Dec 31, 2023) | | :--- | :--- | :--- | | Total Net Debt | Ps. 162,348 million | -47.0% | | Net Debt / LTM Adj. EBITDA | 0.89x | from 1.40x | - As of December 31, 2024, **91%** of the company's total debt was denominated in U.S. dollars[42](index=42&type=chunk) - The company's debt maturity profile is well-balanced, with no bond maturities until the fourth quarter of 2025[45](index=45&type=chunk) [Cash Flow Analysis](index=12&type=section&id=Cash%20Flow%20Analysis) 4Q24 operating cash flow decreased slightly due to working capital changes, with significant cash generated from operations for FY24, alongside substantial capital investments - Cash generated from operating activities in 4Q24 was **Ps. 47,776 million**, compared to Ps. 57,040 million in 4Q23[46](index=46&type=chunk) - In 4Q24, **Ps. 21,429 million** was used for investing activities (primarily maintenance CAPEX) and **Ps. 31,193 million** for financing activities (mainly debt repayments)[47](index=47&type=chunk) - For FY24, capital investments totaled **Ps. 72,004 million**, while cash flow generated by operating activities was **Ps. 124,718 million**[48](index=48&type=chunk) [Appendix](index=14&type=section&id=Appendix) This section provides supplementary information including conference call details, definitions of key financial measures, and detailed financial statements [Conference Call Information](index=14&type=section&id=4Q24%20Earnings%20Conference%20Call) This section provides logistical details for the 4Q24 earnings conference call, including dial-in numbers, webcast link, and replay information - The earnings conference call was scheduled for **10:00 a.m. U.S. ET on March 7, 2025**, with dial-in and webcast details provided[50](index=50&type=chunk) [Definitions](index=14&type=section&id=Definitions) This section defines key non-GAAP financial measures used throughout the report, including Adjusted EBITDA and Net Debt - **Adjusted EBITDA**: Calculated as net profit plus financial interest (net), income tax expense, depreciation and amortization, exchange rate differences, other financial expenses (net), and tax on debits and credits to bank accounts[51](index=51&type=chunk) - **Net Debt**: Calculated as total borrowings less cash, cash equivalents, and short-term investments[52](index=52&type=chunk) [Financial Statements](index=16&type=section&id=Financial%20Statements) This section contains detailed, unaudited condensed interim consolidated financial statements for the periods ended December 31, 2024 and 2023 - The report includes the Condensed Interim Consolidated Statements of Financial Position as of December 31, 2024 and 2023[58](index=58&type=chunk) - The report includes the Condensed Interim Consolidated Statements of Profit or Loss for the three and twelve-month periods ended December 31, 2024 and 2023[60](index=60&type=chunk) - The report includes the Condensed Interim Consolidated Statement of Cash Flows for the three and twelve-month periods ended December 31, 2024 and 2023[62](index=62&type=chunk) - The report provides a table with Financial Data by Segment (excluding the impact of IAS 29) for the three and twelve-month periods ended December 31, 2024 and 2023[64](index=64&type=chunk)

Group 1 - Loma Negra Compania Industrial Argentina S.A. Sponsored ADR (LOMA) is part of the Construction sector, which includes 88 individual stocks and has a Zacks Sector Rank of 12 [2] - LOMA currently holds a Zacks Rank of 1 (Strong Buy), indicating strong potential for outperforming the market [3] - The Zacks Consensus Estimate for LOMA's full-year earnings has increased by 55.3% in the past quarter, reflecting improved analyst sentiment [4] Group 2 - Year-to-date, LOMA has gained approximately 3.9%, outperforming the average gain of 2.7% for the Construction group [4] - LOMA belongs to the Building Products - Home Builders industry, which has an average loss of 3.4% this year, further highlighting LOMA's strong performance [6] - In comparison, another stock in the Construction sector, Primoris Services (PRIM), has a year-to-date return of 4.2% and a Zacks Rank of 2 (Buy) [5][7]

Financial Data and Key Metrics Changes - The company's top line reached ARS 180.7 billion, marking a 21.2% decrease in the quarter, primarily due to lower cement dispatches [8] - Consolidated adjusted EBITDA was $55 million or ARS 43 billion, down 18.5% compared to the same period last year [8][23] - EBITDA margin stood at 24%, reflecting an improvement of 78 basis points year-over-year [9][23] - Net profit attributable to owners of the company was ARS 20.9 billion, compared to ARS 22.9 billion in Q3 2023 [27] Business Line Data and Key Metrics Changes - The cement, masonry cement, and lime segment declined by 21%, with volumes contracting 17.1% year-on-year [14] - Concrete revenues decreased by 29.7% in the quarter, primarily due to a 22% drop in dispatches [16] - The aggregates segment experienced a 42.7% decline, with sales volume down by 29% [16] - Railroad revenue saw a modest decline of 4.7%, with transported volumes dropping by 7% [17] Market Data and Key Metrics Changes - Industry volume showed a strong sequential improvement, increasing by 25%, although still below last year's level [7] - Bulk cement dispatches reached 62%, recovering more quickly than other dispatch modes [12] - Positive indicators such as the recovery of real wages, downward trend in inflation, and lower interest rates are essential for driving sustainable growth [13] Company Strategy and Development Direction - The company is focused on maintaining operational flexibility and production strategy to mitigate the impact of seasonal costs [34] - The management is optimistic about the economic recovery, particularly in the construction sector, driven by credit expansion and foreign investment [35][36] - The company is analyzing capital allocation alternatives for potential dividend improvements in the future [42][45] Management's Comments on Operating Environment and Future Outlook - Management noted that the third quarter showed significant sequential improvement, indicating a move past the worst part of the recession [34] - The company is closely monitoring economic challenges, including inflation and interest rate declines, which could provide a solid foundation for growth [35] - The reduction in country risk is seen as a positive step toward attracting foreign investment [36] Other Important Information - The company ended the quarter with a net debt of ARS 172 billion, achieving a net debt-to-EBITDA ratio of 1.03x, down from 1.4x at the end of 2023 [29] - Cash generation from operational activities reached ARS 64 billion, up from ARS 45 billion in the same period of 2023 [30] - The company allocated ARS 17.4 billion to capital expenditure, with a significant portion directed towards a new project [31] Q&A Session Summary Question: Pricing dynamics and its effect on volumes and revenues - Management is closely monitoring pricing dynamics and may adjust prices less frequently if inflation stabilizes [38][39] Question: Catalysts for larger construction projects and bulk cement demand - Management expects larger projects and public works to impact bulk cement sales positively in the upcoming months [40] Question: Potential for dividend improvements - Management indicated that there are no immediate plans for dividends but is analyzing capital allocation alternatives [42][45] Question: Impact of InterCement situation on debt repayment covenants - Management confirmed there are no covenants regarding change of control that may impact the company [47] Question: Details on the 25-kilo bag project and cement volume recovery - Management noted that profitability between cement and bulk is similar, and they expect a significant recovery in volumes next year [49][50] Question: Recovery of the mortgage market in Argentina - Management observed a recovery in real estate sales, which could boost future construction projects and cement sales [51]

Financial Performance - Net sales revenues decreased by 21.2% YoY to Ps. 180,686 million (US$ 185 million) in 3Q24, primarily due to a 21.0% decline in Cement segment sales volumes[3]. - Consolidated Adjusted EBITDA reached Ps. 43,279 million (US$ 55 million), down 18.5% YoY in pesos and 16.5% in dollars, with an EBITDA margin of 24.0%, an increase of 78 basis points YoY[3][7]. - Net profit for 3Q24 was Ps. 21,153 million, an 8.7% decrease from Ps. 23,177 million in the same period last year, with a notable improvement in net total finance gain[3][15]. - Gross profit fell 23.5% YoY to Ps. 40,774 million in 3Q24, with a gross profit margin contraction of 69 basis points to 22.6%[21]. - The company reported a total net financial gain of Ps. 12,599 million in 3Q24, compared to a net financial cost of Ps. 4,884 million in 3Q23[28]. - The company reported a significant decrease in finance costs, down 70.6% to ARS 12,902 million in Q3 2024 from ARS 43,914 million in Q3 2023[50]. - The company’s total shareholder's equity rose to ARS 714,674 million as of September 30, 2024, from ARS 593,095 million as of December 31, 2023[48]. Sales and Volume Trends - Cement, masonry, and lime sales volumes fell by 17.1% YoY to 1.44 million tons, although there was a sequential recovery of 32%[11]. - The Concrete segment experienced a 22.2% YoY decline in sales volumes, with a sequential improvement of 28%[12]. - The Aggregates segment saw a 28.7% decrease in sales volumes year-over-year, indicating ongoing challenges in the market[12]. - Railroad segment revenues decreased by 4.7% YoY, with a 7.0% decline in transported volume, partially offset by positive pricing dynamics[19]. - Net revenue for Q3 2024 was ARS 180,686 million, a decrease of 21.2% compared to ARS 229,223 million in Q3 2023[50]. Cost and Expenses - Cost of sales decreased by 20.5% YoY to Ps. 139,911 million in 3Q24, primarily due to lower sales volumes and improved energy inputs[20]. - Selling and administrative expenses decreased by 12.9% to Ps. 16,569 million in 3Q24, reaching 9.2% of sales, up 87 basis points YoY[22]. - The cost of sales for the three months ended September 30, 2024, was 110,611 million pesos, up from 41,856 million pesos in the same period of 2023, representing a rise of 164.5%[54]. Debt and Liquidity - Net debt decreased to Ps. 171,888 million (US$ 177 million), resulting in a Net Debt/LTM Adjusted EBITDA ratio of 1.03x, down from 1.40x in FY23, reflecting a US$ 40 million reduction in indebtedness during the quarter[3][7]. - Total debt as of September 30, 2024, was Ps. 185,606 million, down from Ps. 296,811 million YoY, with a net debt to LTM adjusted EBITDA ratio of 1.03x[30][34]. - Cash generated from operating activities in 3Q24 was Ps. 63,570 million, compared to Ps. 45,154 million in 3Q23, mainly due to positive working capital effects[36]. - Cash and cash equivalents at the end of the period were 13,718 million pesos, consistent with 64,610 million pesos at the end of the same period in 2023[52]. Future Outlook - The company anticipates a stronger recovery as macroeconomic factors stabilize, indicating optimism for future performance[6][8]. - The company provided a forward guidance of 8% revenue growth for Q4 2023, projecting revenues between $2.7 billion and $2.8 billion[55]. - The company plans to enter two new international markets by the end of 2023[55]. Operational Highlights - The Adjusted EBITDA margin for the Concrete segment improved to 4.2%, up 355 basis points YoY, while the Aggregates segment contracted to negative 17.0%[25]. - The company experienced a net cash used in investing activities of 17,629 million pesos for the three months ended September 30, 2024, compared to 13,321 million pesos in the same period of 2023, reflecting an increase of 32.5%[52]. - The company reported a net cash used in financing activities of 34,767 million pesos for the three months ended September 30, 2024, compared to 61,206 million pesos in the same period of 2023, indicating a decrease of 43.2%[52]. - The company’s inventories increased to ARS 166,065 million as of September 30, 2024, from ARS 154,181 million as of December 31, 2023[48]. Market and Product Development - New product launches contributed to a 20% increase in sales in the consumer electronics segment[55]. - Market expansion efforts led to a 25% increase in sales in the Asia-Pacific region[55]. - The company completed a strategic acquisition of a tech startup for $200 million to enhance its product offerings[55]. - The company invested $150 million in R&D for new technologies, focusing on AI and machine learning[55]. - Customer satisfaction ratings increased to 90%, reflecting improved service and product quality[55].

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