Loma Negra (LOMA) Q4 2023 earnings summary

Executive summary

• FY23 revenue was Ps. 422,161 million, down 6.6%; Adjusted EBITDA was Ps. 100,351 million, down 25.7%.

• FY23 net income was Ps. 9,681 million; net income attributable to owners rose 70.7% to Ps. 10,305 million.

• 4Q23 revenue fell 13.2% to Ps. 99,398 million and Adjusted EBITDA fell 44.7% to Ps. 22,678 million; the quarter recorded a Ps. 20,188 million net loss.

• Net debt reached Ps. 140,636 million (US$174 million); net debt/LTM Adjusted EBITDA rose to 1.40x from 0.37x at FY22.

• FY23 dispatch volume was the second-highest on record, while activity softened in 4Q amid the electoral period and administration change.

Financial highlights

• FY23 gross profit fell 13.2% to Ps. 105,907 million; gross margin contracted 192 bps to 25.1%.

• 4Q23 gross profit fell 14.3% to Ps. 26,018 million; gross margin eased 36 bps to 26.2%, while SG&A was nearly flat at Ps. 10,000 million.

• 4Q23 net loss was Ps. 20,188 million versus net income of Ps. 23,207 million in 4Q22; net loss attributable to owners was Ps. 19,780 million.

• FY23 net income was Ps. 9,681 million versus Ps. 5,627 million; net income attributable to owners increased 70.7% to Ps. 10,305 million.

• 4Q23 foreign-exchange loss was Ps. 73.2 billion versus Ps. 9.4 billion in 4Q22; financial costs were Ps. 37.3 billion versus a Ps. 1.2 billion net gain.

Outlook and guidance

• Management expressed confidence in Argentina’s growth potential once the environment becomes less volatile, emphasizing resilience and adaptability in challenging conditions.

• Industry participants remained cautious pending initial government measures and stabilization of key economic variables; recovery was expected to be difficult after the sharp start-of-year decline.