Financial Data and Key Metrics Changes - The company reported an adjusted EBITDA of $66 million for Q3 2023, down 3.1% year-on-year, with a consolidated EBITDA margin of 23.2%, reflecting a year-on-year expansion of 105 basis points [11][33] - Total revenue for the quarter was ARS 74 billion, a decrease of 8.3% primarily due to volume contraction in the cement segment [27][30] - The net profit attributable to owners of the company was ARS 7.4 billion, compared to a net loss of ARS 28.9 billion in Q3 2022, mainly due to lower total financial costs [33] Business Line Data and Key Metrics Changes - The cement segment saw a revenue decline of 12.8%, with volumes contracting 7.1% year-on-year, attributed to a decrease in bagged cement sales and softer price dynamics [30] - Concrete revenues decreased by 4.2%, with volumes down 9.4%, although pricing performance was strong [30] - The aggregates segment showed a 17.5% expansion, with sales volumes remaining almost flat, driven by good price performance [10] Market Data and Key Metrics Changes - The national cement industry sales demonstrated resilience despite a 5.6% decrease, ranking Q3 2023 as the second best in history, with cumulative volume just 1.8% below the same period in 2022 [29] - The company maintained a cash position of ARS 20.9 billion and total debt of ARS 96.1 billion, resulting in a net debt-to-EBITDA ratio of 0.97 times [13] Company Strategy and Development Direction - The company is cautiously optimistic about the resolution of the electoral process, which is expected to alleviate volatility and pave the way for economic recovery [9] - The company aims to maintain its leadership position in the industry while navigating a challenging economic environment [36] Management's Comments on Operating Environment and Future Outlook - Management noted that cement volume remains solid despite economic challenges, and they expect to achieve their objectives even in a volatile environment [15][36] - The company anticipates a decrease in energy costs for 2024, with a focus on utilizing natural gas in their energy matrix [40] Other Important Information - The company issued a Class 3 domestic bond for $55 million, which will help refinance cross-border debt and reduce financial costs [34] - The company’s operating cash generation stood at ARS 14.6 billion, with capital expenditures allocated mostly for maintenance [13] Q&A Session Summary Question: Expectations for cement demand in 2024 and impact of elections - Management is working on projections for next year but does not provide specific guidance on volumes [21] Question: Pricing strategy in high inflation environment - The pricing strategy is linked to general inflation, FX, and internal cost inflation, with competitive dynamics influencing market share [46] Question: Operational capacity of L'Amali 2 - The operational capacity is above 6,000 tons per day, with expectations to reach 3 million tons annually [48] Question: Energy matrix evolution into 2024 - The company expects a decrease in energy costs and plans to utilize natural gas for thermal energy [40] Question: Renewal of Ferrosur concession - The concession was renewed for 18 months, and discussions with the government regarding the new contract are ongoing [42]
Loma Negra pania Industrial Argentina Sociedad Anonima(LOMA) - 2023 Q3 - Earnings Call Transcript