Cementos Pacasmayo S.A.A. Announces Consolidated Results for First Quarter 2024
Cementos Pacasmayo S.A.A. reported consolidated results for the first quarter of 2024, showing a 10.0% increase in EBITDA due to lower costs and operational efficiencies. Despite a 7.2% decrease in sales volume, the company achieved a 2.8 percentage point increase in EBITDA margin. Net income rose by 13.8% to S/49.5 million, attributed to operational efficiencies.
Consolidated EBITDA increased by 10.0% due to lower costs and operational efficiencies.
Consolidated EBITDA margin improved by 2.8 percentage points.
Net income rose by 13.8% to S/49.5 million.
Sales volume of cement, concrete, and precast decreased by 7.2%.
Revenues decreased by 0.7% in line with the volume decrease.
Decrease in demand was attributed to a contraction in public and private investment, high insecurity levels, and a decrease in the self-construction segment.
Insights
The reported increase in Consolidated EBITDA by 10.0% for Cementos Pacasmayo indicates a positive operational performance, particularly highlighting the company's strategic decision to discontinue the use of imported clinker. By leveraging a new, more efficient kiln, the company has managed to enhance its cost structure, leading to an improved EBITDA margin of 27.9%, up 2.8 percentage points. This operational efficiency is important for retail investors to consider, as it may signal a company's ability to manage costs and optimize operations despite market conditions.
In assessing Net income growth of 13.8%, it's important to note the contrast with the 7.2% decrease in sales volume. This discrepancy reveals that despite a dip in demand, the company's net profitability has improved. Factors contributing to the demand decrease could be macroeconomic or industry-specific, such as reduced public and private investment or regional issues impacting the self-construction segment. These elements should be taken into account for future revenue projections and risk assessment.
Lastly, the slight 0.7% decrease in revenues appears to be in direct correlation with the volume decrease. The fact that revenue has not decreased proportionally to volume might imply that the company has some pricing power or has diversified its product mix to offset volume declines. Investors should keep an eye on future revenue trends to gauge whether this is a temporary setback or part of a longer-term trend.
From a market perspective, the construction sector in Peru is evidently facing headwinds, as indicated by the decreased sales volume for Cementos Pacasmayo. The reduction in demand stemming from lower investment levels and insecurity could suggest a broader economic slowdown that may affect construction and related industries. This might be a red flag for investors who are assessing the sector's growth potential in the near term. A detailed understanding of the economic indicators driving construction demand is essential for investors looking to gauge the resilience and growth potential of Cementos Pacasmayo within this challenging environment.
Investors should also consider the impact of external factors such as the performance of the agriculture and fishing industries in the region, cited as having a negative effect on construction activities. Diversification of market presence and product offerings could be vital strategies for Cementos Pacasmayo to mitigate such regional risks. Moreover, the company's ability to adapt to these conditions and maintain operational efficiency, as evidenced by the EBITDA increase, could set it apart from competitors that may not have the same level of operational flexibility.
1Q24 FINANCIAL AND OPERATIONAL HIGHLIGHTS:
(All comparisons are to 1Q23, unless otherwise stated)
-
Consolidated EBITDA of S/132.8 million, a
10.0% increase, mainly due to lower costs and operational efficiencies as we discontinued the use of imported clinker and used our new and more efficient kiln. -
Consolidated EBITDA margin of
27.9% , a 2.8 percentage point increase. -
Sales volume of cement, concrete and precast decreased
7.2% , mainly due to a contraction in demand due to a decrease in public and private investment, a high level of insecurity and a decrease in the self-construction segment explained by a negative effect on activities like fishing and agriculture, two of the most significant sources in our area of influence. -
Revenues decreased
0.7% , in line with the decrease in volumes mentioned above. -
Net income of S/ 49.5 million, a
13.8% increase mainly due to the operational efficiencies mentioned above.
For a full version of Cementos Pacasmayo’s First Quarter 2024 Earnings Release, please visit https://www.cementospacasmayo.com.pe/inversionistas/reportes
CONFERENCE CALL INFORMATION:
Cementos Pacasmayo will host a conference call on Tuesday, April 30, 2024, to discuss these results at 9:30 a.m. Lima Time and 10:30 am Eastern Time.
To access the call, please dial:
+1 (718) 866-4614 from within the
Access code: 505256
There will also be a live Audio Webcast of the event at:
https://mm.closir.com/slides?id=505256
You can also find additional dial-in numbers depending on your current location in the above link.
About Cementos Pacasmayo S.A.A.
Cementos Pacasmayo S.A.A. is a cement company, located in the Northern region of
View source version on businesswire.com: https://www.businesswire.com/news/home/20240429158396/en/
Cementos Pacasmayo S.A.A.
In
Manuel Ferreyros, CFO
Claudia Bustamante
Investor Relations Manager
+51-958699760
cbustamante@cpsaa.com.pe
Source: Cementos Pacasmayo S.A.A.
FAQ
What were Cementos Pacasmayo S.A.A.'s 1Q24 financial highlights?
Why did sales volume of cement, concrete, and precast decrease in 1Q24?
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