Grupo Argos (GRUPOARGOS) Q2 2024 earnings summary

Executive summary

• Nutresa share-swap transactions generated a COP 2.6tn after-tax benefit and shifted infrastructure and cement investments from 56% to 70% of the portfolio.

• H1 consolidated EBITDA rose 41.1% to COP 3.363tn; net income reached COP 6.846tn, including the Nutresa transaction gain.

• Q2 revenue fell 16.7% to COP 3.685tn, mainly reflecting airport deconsolidation; EBITDA declined 12.7% to COP 993bn, while net income rose 27.7% to COP 337bn.

Financial highlights

• H1 revenue was COP 8.223tn, up 0.5% YoY; operating income increased 50% to COP 2.945tn and EBITDA rose 41.1%.

• H1 net income attributable to controlling interests was COP 3.980tn versus COP 718bn; Q2 controlling-interest net income was COP 189bn, down 39.5%.

• Separated H1 revenue rose 224.3% to COP 3.191tn, EBITDA rose 305% to COP 3.092tn and net income rose 281% to COP 2.683tn.

• Portfolio value was COP 16.085tn at June 30, including COP 6.099tn in Cementos Argos, COP 5.205tn in Grupo Sura, COP 2.229tn in Celsia and COP 2.057tn in Odinsa.

Outlook and guidance

• 2024 consolidated revenue projection was COP 14tn versus COP 22.6tn in 2023; projected EBITDA was ~COP 5tn and net profit COP 7.6tn versus COP 1.5tn.

• 2024 consolidated debt was expected at COP 1.6–1.7tn; maturities were to be refinanced using the most cost-efficient structure.

• 2024 CapEx was estimated at ~COP 3tn, mainly funded with business cash, including >COP 500bn for cement, COP 540bn for energy, COP 550bn for roads and >COP 400bn for urban development.

• Domestic cement dispatches may improve over 12–18 months; Central America and Caribbean cement performance was expected to remain positive over the next six months, subject to seasonality.

• Summit Materials maintained FY2024 EBITDA guidance of USD 970m–1.01bn and expected USD 40m in synergies during the year.