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Yahoo
a day ago
- Business
- Yahoo
Cementos Argos SA (CMTOY) Q2 2025 Earnings Call Highlights: Strategic Moves and Market Challenges
Release Date: August 13, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points Cementos Argos SA (CMTOY) achieved a significant milestone by completing the spinoff of its portfolio, becoming a pure player in the heavy business materials industry. The company reported a dividend yield of 18%, significantly higher than the industry average of 2%, enhancing shareholder value. Cementos Argos SA (CMTOY) made a strategic acquisition of a 60% stake in a major aggregates asset in the Caribbean, with plans to generate $100 to $150 million in additional EBITDA by 2030. The company was selected to be part of the FTSE4Good Index, demonstrating strong environmental, social, and governance practices. Cementos Argos SA (CMTOY) reported a consolidated EBITDA margin of 22% for the second quarter, driven by a consistent pricing strategy and efficiency initiatives. Negative Points The company experienced a challenging construction environment, with cement and mix volumes decreasing by 4.4% and 19.7% respectively. Higher than expected maintenance costs in the Cartagena plant and certain non-recurring expenses impacted financial performance. The Panamanian market continues to lag, with a 12% decrease in demand, affecting overall regional performance. Cementos Argos SA (CMTOY) faced lower exports from Honduras due to a kiln stoppage, impacting volumes in Guatemala. Financial expenses were higher compared to the first quarter, partly due to fees paid to financial institutions. Q & A Highlights Warning! GuruFocus has detected 9 Warning Sign with CMTOY. Q: What are the trends in the Colombian market for the second half of the year, and what is the outlook for exports? A: We are seeing positive dynamics in Colombia, with improved daily average sales starting in June. The consumer segment and new housing sales are performing well, with a 20% increase in sales expected in the second half. Local municipalities are deploying more infrastructure projects, indicating a better second half. Regarding exports, we have reduced capacity due to the shutdown of a wet kiln in Cartagena for environmental and cost reasons. Juan Esteban Cale, CEO Q: Could you provide more details about the cement industry in Colombia and potential catalysts for demand? A: Interest rates and inflation are key catalysts. As interest rates decrease, demand increases, particularly in the retail segment. Infrastructure projects at municipal and state levels, such as the tunnel de Too in Antioquia and a new project in Bogota, are expected to drive demand. Carlos Giusi, VP of the Colombia Division Q: What are the impacts of non-recurring items on net income, and should we expect more in the future? A: The adjustment in the second quarter was due to the optimization of operations, specifically the plant in Puerto Rico. We do not expect further adjustments from this operation, and it has no negative impact on cash flow. Felicia Istizabal, CFO Q: How much of the proceeds from the Summit sale were used for the new Caribbean platform acquisition, and why were financial expenses higher this quarter? A: A small portion of the proceeds was used for the Caribbean platform acquisition. The acquisition includes significant reserves and access to deep water ports. Financial expenses were higher due to fees paid to financial institutions, despite stable debt levels. Juan Esteban Cale, CEO and Felicia Istizabal, CFO Q: What is the expected timeline and CapEx for the new platform to generate $150 million in EBITDA by 2030? A: We expect to reach this EBITDA level over the next five years, with total capital needed well below $50 million. Felicia Istizabal, CFO For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Yahoo
02-03-2025
- Business
- Yahoo
Cementos Argos SA (CMTOY) Q4 2024 Earnings Call Highlights: Record Shareholder Returns and ...
Adjusted ROCE: 14.1%, 257 basis points above guidance mid-range. Adjusted EBITDA Margin: 22.6%, surpassing guidance by 60 basis points. Total Shareholder Return: 350% in dollar terms since February 2023. Sale of Summit Materials Stake: $2.9 billion, representing a 43% appreciation. Total Adjusted EBITDA: COP1.2 trillion, up 8.6% from last year. Adjusted Net Profit: COP310 billion for 2024. Dividend Payment Proposal: COP1 trillion, a 71% increase from 2024. Colombia EBITDA: COP784 billion, a 5.3% increase from 2023. Colombia EBITDA Margin: 26.6%, expanding 263 basis points from the previous year. Central America EBITDA: $142 million, with a 25% margin, expanding 219 basis points. Caribbean EBITDA Growth: 30.8%, with a 439 basis points margin expansion. 2025 EBITDA Guidance: COP1.20 trillion to COP1.25 trillion. 2025 CapEx Guidance: $70 million to $90 million, with at least $50 million for maintenance. Net Debt to EBITDA Target: 2 times, expected within three to five years. Warning! GuruFocus has detected 7 Warning Signs with FRA:KO2. Release Date: February 25, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Cementos Argos SA (CMTOY) achieved an adjusted ROCE of 14.1%, surpassing their guidance by 257 basis points. The company reported an adjusted EBITDA margin of 22.6% for 2024, exceeding their guidance by 60 basis points. Cementos Argos SA (CMTOY) successfully executed its SPRINT 2.0 program, resulting in a total shareholder return of 350%. The company completed the sale of its 31% stake in Summit Materials for $2.9 billion, realizing a 43% appreciation. Cementos Argos SA (CMTOY) plans to distribute COP2.25 trillion to shareholders through dividends and a spinoff, offering a record dividend yield of 16%. Cementos Argos SA (CMTOY) experienced a decrease in cement and remix volumes by 3.6% and 5.6% respectively, due to challenges in the housing segment in Colombia. The company's adjusted net profit of COP310 billion in 2024 was not fully comparable to 2023 due to changes in US operations. The Colombian market faced a 6% decrease in cement dispatches, impacting local sales. The company anticipates challenging market conditions in Colombia for 2025, with potential flat or slightly decreasing demand. Cementos Argos SA (CMTOY) faces intense competition and external pressures in Central America and the Caribbean, despite achieving growth. Q: Could you provide more details on the inorganic expansion in the US, specifically regarding assets in the aggregate business or cement, and which regions are most attractive for the company? A: We are leveraging our existing capabilities in Colombia, Central America, and the Caribbean to export cement and aggregates to the US. We have identified actionable opportunities in aggregates and cement that we believe will be extremely valuable for our shareholders. More details will be provided as we progress. - Juan Esteban Calle Restrepo, CEO Q: Can you elaborate on the cost efficiencies achieved and the M&A activity in the US? A: We have focused on improving operational efficiencies, optimizing our logistics network, and managing costs effectively, leading to significant margin expansion. Regarding M&A in the US, we are building on our current capabilities and market knowledge to establish a platform capable of generating $300 million in annual EBITDA within the next three to five years. - Juan Esteban Calle Restrepo, CEO Q: How do you plan to achieve a 25% EBITDA margin, and what efficiencies are you targeting? A: We are targeting a 10% SG&A to revenue ratio by 2025 and 9% by 2026. We aim to improve OEE, optimize logistics, and manage fixed and variable costs to reach the 25% EBITDA margin target within the next two years. - Juan Esteban Calle Restrepo, CEO Q: Are there opportunities to increase volumes in Colombia to boost exports to the US? A: We are not targeting new opportunities in Colombia but will use our existing asset base to expand exports from Cartagena. - Juan Esteban Calle Restrepo, CEO Q: What is the outlook for the Colombian market, and do you expect any changes in demand dynamics? A: The Colombian market will face challenges in 2025, but we are optimistic about improving margins and profitability. We expect a recovery in the informal segment due to decreasing inflation, although the market may remain flat or slightly decrease. - Felipe Aristizabal, VP - Corporate Finances For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
