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Grupo Argos 2018 results February 2019

Thursday, 11 July 2019 17:14 Written by

Grupo Argos Full-Year 2018 Profits Jump 32% Year-on-Year

Medellin-based cement, electric power and airport/highway concessionaire Grupo Argos announced February 23, 2019 that its full-year 2018 net income jumped 32% year-on-year, to COP$1.2 trillion (US$386 million).

Earnings before interest, taxes, depreciation and amortization (EBITDA) hit a record COP$4 trillion (US$1.28 billion), while EBITDA margin came-in at 28%, according to the company.

In its Argos cement/concrete division, “the opportunities of the Colombian capital market were exploited and the [public stock-buying] participation was increased to 58% in ordinary shares,” according to the company.

As for its Celsia electric-power division, “the issuance of shares by Celsia was subscribed for an amount of COP$780 billion [US$251 million],” while in the Celsia airport/highways concession business, “the process of delisting of Odinsa was completed,” as Grupo Argos now holds 99.84% of all shares.

“These [2018] results place us in a privileged position and with optimism to continue promoting the development of infrastructure in our country, a fundamental pillar of competitiveness and progress for Colombia,” added Grupo Argos president Jorge Mario Velásquez.

At year-end 2018, Grupo Argos assets rose to COP$49 trillion (US$15.7 billion), the company added.

As for fourth quarter (4Q) results, Grupo Argos saw net income soar 248% year-on-year, to COP$330 billion (US$106 million), while 4Q 2018 EBITDA rose 14% year-on-year, according to the company.

During 2018, the Odinsa division boasted that the “Pacifico 2” fourth-generation (4G) highway construction project in Antioquia reached 59% completion, or eight percentage points ahead of schedule.

In the Celsia power division, Argos invested COP$618 billion (US$199 million) mainly in renewable, non-conventional energies.

At Cementos Argos, a novel efficiency scheme boosted that division’s net profit to COP$179 billion (US$57 million), while its holdings in the “Pactica” real-estate development partnership closed 2018 with property transactions of nearly COP$140 billion (US$45 million), “an unprecedented figure for this business group,” according to Argos.


Construcciones El Condor Full-Year 2018 Net Income Dips Year-on-Year, but 4Q Profits Soar

Medellin-based highway construction specialist Construcciones El Condor announced February 28, 2019 that its full-year 2018 consolidated net income hit COP$112.6 billion (US$36 million), down from COP$183 billion (US$59 million) but explained by a non-recurring sales gain in 2017.

Operating income during 2018 included COP$1 trillion (US$324 million) for sale of services plus COP$11 billion (US$3.6 million) for goods. Operational costs were 84% of operating revenues, up 14.3% year-on-year, according to the company.

Earnings before interest, taxes, depreciation and amortization (EBITDA) for full-year 2018 totaled COP$176 billion (US$57 million) – “not comparable with 2017 due to non-recurring events” -- and EBITDA margin was 16.5%, according to the company.

At year-end 2018, total assets totaled COP$2.56 trillion (US$831 million), down 5.24% year-on-year, while total liabilities fell 25% year-on-year, to COP$1.47 trillion (US$477 million), according to El Condor.

As for fourth-quarter (4Q) 2018, operating income jumped 57% year-on-year, to COP$284 billion (US$92 million), while 4Q 2018 EBITDA soared to COP$46 billion (US$15 million) versus COP$9.7 billion (US$3 million) in 4Q 2017.

Net income for 4Q 2018 also jumped to COP$29.9 billion (US$9.7 million) versus COP$9.2 billion (US$3 million) in 4Q 2017.

At year-end 2018, construction backlog –including works contracted and to be executed – totaled COP$1.82 trillion (US$590 million), including an existing contract with Prodeco as well as the signing of a new contract with the Santa Marta-Paraguachón S.A.S. highway concession, according to El Condor.


Colombia’s national economics statistics agency (DANE, Departamento Administrativo Nacional de Estadistica) on February 28 revealed that its latest studies indicate national gross domestic product (“PIB” in Spanish initials) hit 2.7% for full-year 2018, up from a feeble 1.4% in 2017.

Meanwhile, Fedesarollo – Colombia’s leading economic think-tank – now foresees a continuing rebound in the national economy, with GDP likely hitting about 3.3% this year and gradually increasing to around 3.8% GDP by 2022.

For 2018, relatively strong growth (4.1%) came in public administration and defense; compulsory social security plans; education; health care activities and social services, according to DANE.

Wholesale and retail sectors, repair of motor vehicles and motorcycles, transportation and storage, lodging and food service sectors meanwhile grew by 3.1%, according to DANE.

Professional, scientific and technical activities, as well as administrative and support services activities grew by 5.0%, according to DANE.

Mining and quarrying, however, declined by 0.8% year-on-year, including a 12% drop in extraction of metalliferous minerals and a 6.7% drop in extraction of coal and lignite.

Extraction of crude oil and natural gas and support activities grew by 1.4%

In manufacturing, this sector grew by 2.0%, mainly thanks to a 3.7% hike in manufacture of furniture, mattresses and mattresses, and a 3.2% hike in production of food products, beverages and tobacco products.

The study also found a 2.2% hike in sectors including manufacture of basic metallurgical products; manufacture of fabricated metal products, except machinery and equipment; manufacture of electrical apparatus and equipment; manufacture of computer, electronic and optical products; manufacture of machinery and equipment; manufacture of motor vehicles, trailers and semi-trailers; manufacture of other types of transport equipment, and installation, maintenance and specialized repair of machinery and equipment.

Manufacture of textile products; clothing; tanning and retanning of hides; footwear manufacturing; manufacture of travel articles, suitcases, handbags and similar articles; and manufacture of saddlery and saddlery articles decreased by 0.2% year-on-year.

In construction, growth came-in at a relatively weak 0.3% year-on-year, with residential and non-residential building growth at 1.0%, while “specialized activities for the construction of buildings and civil engineering works (rental of machinery and construction equipment with operators) decreased by 0.9%,” according to DANE.

Construction of roads and railways, public service projects and other civil engineering works also decreased by 0.6%.

The information and communications sector grew by 3.1% year-on-year, identical to the growth in the financial and insurance sector, according to DANE.

As for real estate activities, this sector grew 2.0% year-on-year, according to DANE.


Cemex Latam 4Q 2018 results February 2019

Thursday, 11 July 2019 16:53 Written by

Cemex LatAm 4Q 2018 Net Profits Slip, Colombia Sales Dip

Bogota-based cement/concrete manufacturing giant Cemex LatAm Holdings announced February 7, 2019 that its fourth-quarter (4Q) 2018 region-wide net profits fell 33% year-on-year, to US$10 million, from US$33 million in 4Q 2017.

But full-year 2018 profits improved 36% year-on-year, to US$63 million, from US$46 million in 2017, according to the company, which operates in Colombia, Panamá, Costa Rica, Nicaragua, El Salvador and Guatemala.

As for its Colombia operations, full-year 2018 sales slipped 7% year-on-year, to US$524 million, while 4Q 2018 sales dipped 6% year-on-year, to US$125 million, from US$134 million in 4Q 2017, according to Cemex.

Colombian sales of grey cement for full-year 2018 dipped 6% year-on-year, but rose 4% in 4Q 2018, while Colombian concrete sales fell 11% for full-year 2018 and by 8% in 4Q 2018.

Sales of aggregates in Colombia declined 14% for full-year 2018 and 15% in 4Q 2018 versus 4Q 2017, according to the company.

Cemex foresees 2019 demand for cement in Colombia either flat or rising by 1%, while demand for concrete and aggregates would rise by 1% to 3%, according to the company. Product prices also began to recover slightly in the Colombian market during 4Q 2018, according to the company.

Colombia’s residential-sector demand rose slightly during 4Q 2018, according to Cemex, especially in the “informal” and “self-built” housing segments.

For these lower-income “social housing” sectors, “there are encouraging signs for the future, given that sales and construction permits through September 2018 rose by 5% and 15% respectively . . . supported by continuing government subsidies,” according to the company.

However, the middle- and upper-income housing sectors continue to face challenges as new-starts and housing-permit applications had fallen 18% through September 2018, and inventories in these sectors remains relatively high, at 16-months turnover rate.

As for the Colombian infrastructure sector (highways, airports, tunnels, hospitals, sewage-treatment plants, schools, marine ports), 4Q 2018 demand continued relatively strong, according to the company.

Cemex dispatched its products to 15 “fourth-generation” (4G) highway projects including the “Mar 1” and “Vias del Nus” projects in Antioquia, plus others elsewhere including “Autopista al Rio Magdalena 2;” “Bucaramanga-Barranca-Yondó;” “Bucaramanga-Pamplona;” and “Pasto-Rumichaca.” Cemex achieved 36% market participation in 4G projects during 2018.

For the rest of 2019, Cemex expects demand for cement in Colombian infrastructure proejcts to rise by low-single-digits, including several large road-building projects in Bogota, according to the company.


Celsia 2018 results February 2019

Thursday, 11 July 2019 16:51 Written by

Celsia Photovoltaic Solar Power Array/ Source: Celsia

Celsia Full-Year 2018 Profits Jump 39% Year-on-Year

Medellin-based electric power producer Celsia announced February 19, 2019 that its full-year 2018 net income rose 39.7% year-on-year, to COP$350.7 billion (US$112.6 million), from COP$251 billion (US$80 million) in 2017.

Fourth-quarter (4Q) 2018 net income also rose year-on-year, hitting COP$108 billion (US$34.7 million), up from COP$71 billion (US$22.8 million) in 4Q 2017.

Gross revenues likewise rose 10.7% year-on-year, hitting COP$3.4 trillion (US$1.1 billion) for 2018, versus COP$3.1 trillion (US$995 million) in 2017. Colombia accounted for 81% of revenues, while its Central America power sales accounted for the remaining 19%.

Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 1% year-on-year, according to Celsia, a subsidiary of Medellin-based Grupo Argos.

Celsia mainly credited income growth to consolidation of its EPSA (Empresa de Energia del Pacifico S.A.) power subsidiary; start-up of the Celsia Solar Bolívar photovoltaic plant; and the completion of its “Plan5Caribe” power projects in Cartagena and Valledupar.

“The strategy of optimizing our capital structure decreased interest rates, which allowed for a reduction in financial expense,” according to Celsia.

“Net debt at the end of the year amounted to COP$3.06 trillion [US$982 million] with a net-debt-to-EBITDA indicator of 2.7 times, below the 3.2 times [ratio] registered in 2017,” according to the company.

Income tax also fell 22.5% year-on-year thanks to favorable tax-law credits and deductions, the company added.

Consolidated investments rose 20% year-on-year, hitting COP$618 billion (US$198 million), COP$592 billion of which was in Colombia.

“Through EPSA, Celsia structured an issuance of ‘green bonds’ worth COP$420 billion [US$135 million] for the development of unconventional renewable energy projects,” with COP$140 billion [US$45 million] bonds already having been sold.


BYD Launches Electric-Car Sales Just as Medellin Toughens Air-Pollution Driving Limits

China-based electric vehicle (EV) manufacturer BYD on February 7, 2019 launched sales of zero-emissions EV cars at its first-ever retail showroom in Medellin – simultaneous with the Mayor’s office announcing new driving restrictions on polluting vehicles with internal combustion engines (ICEs) for the entire Medellin metro area.

BYD’s new dealership on Avenida El Poblado opposite the Premium Plaza mall comes on the heel of winning a contract to supply 64 pure electric buses to Medellin’s “Metro” public transit agency later this year (see Medellin Herald on December 29, 2018).

“Medellín is among the places with the greatest potential in Colombia for the development of mobility with electric vehicles,” said Juan Felipe Velásquez, BYD’s commercial director for Antioquia.

“Both the municipal administration and private companies [including EV sellers Renault, Nissan and Mitsubishi] have made important bets in the development of sustainable mobility . . . The environmental contingency of the metropolitan area has caused the authorities to focus their efforts on electric vehicle replacement,” he added.

Medellin also aims to expand the fleet of EV taxis, Velasquez said. “This project is very important for us as BYD, so much so that we are structuring two electric-taxi pilot [projects] with different individual public transport administration companies, which will start in a few months,” he said.

Beyond EV cars, buses and taxis, BYD “intends to exploit a high-potential market with last-mile cargo [local delivery vehicles,” according to the company.

Meanwhile, Medellin and the regional planning agency (Area Metropolitana del Valle de Aburra, AMVA) jointly announced greater “pico y placa” restricions on more ICE vehicles over more days -- including six days/week (rather than the current five) and hitting six of the nine digits on license plates, rather than just the current four of the nine digits.

The existing “pico y placa” vehicle-driving restrictions alternately ban circulation of vehicles depending upon the final digits of license plates, during morning and afternoon rush-hours.

Under the new scheme – debuting February 18 and lasting until at least March 30 – older, higher-polluting vehicles will face even greater hours-of-operation restrictions, from 5 am to 8:30 am, and then from 4:30 pm to 9 pm Monday through Saturday, according to AMVA.


China-based electric vehicle (EV) manufacturer BYD on February 7 launched sales of zero-emissions EV cars at its first-ever retail showroom in Medellin – simultaneous with the Mayor’s office announcing new driving restrictions on polluting vehicles with internal combustion engines (ICEs) for the entire Medellin metro area.

BYD’s new dealership on Avenida El Poblado opposite the Premium Plaza mall comes on the heels of winning a contract to supply 64 pure electric buses to Medellin’s “Metro” public transit agency later this year (see Medellin Herald on December 29, 2018). It's a further sign that Medellin aims to slash air pollution by replacing ICE vehicles with EVs of all types, including cars, motorcycles, buses,  taxis, local-delivery vehicles, rail transit, cable-cars and trams.

“Medellín is among the places with the greatest potential in Colombia for the development of mobility with electric vehicles,” said Juan Felipe Velásquez, BYD’s commercial director for Antioquia.

“Both the municipal administration and private companies [including EV sellers Renault, Nissan and Mitsubishi] have made important bets in the development of sustainable mobility . . . The environmental [air-pollution] contingency of the metropolitan area has caused the authorities to focus their efforts on electric vehicle replacement,” he added.

Medellin also aims to expand the fleet of EV taxis, Velasquez said. “This project is very important for us as BYD, so much so that we are structuring two electric-taxi pilot [projects] with different individual public transport administration companies, which will start in a few months,” he said.

Beyond EV cars, buses and taxis, BYD “intends to exploit a high-potential market with last-mile cargo [local delivery] vehicles,” according to the company.

Meanwhile, Medellin and the regional planning agency (Area Metropolitana del Valle de Aburra, AMVA) on February 7 jointly announced greater “pico y placa” restricions on more ICE vehicles over more days -- including six days/week (rather than the current five) and sequentially hitting six of the last nine digits on license plates each day, rather than just the current four of the nine digits.

The existing “pico y placa” vehicle-driving restrictions alternately ban circulation of vehicles -- depending upon the final digits of license plates -- during morning and afternoon rush-hours. However, zero-emissions EVs are exempt from such driving restrictions.

Under the new scheme – debuting February 18 and lasting until at least March 30, the typical "dry" season for air-pollution alerts – older, higher-polluting vehicles will face even greater hours-of-operation restrictions, from 5 am to 8:30 am, and then from 4:30 pm to 9 pm Monday through Saturday, according to AMVA.


Bogota-based cement/concrete manufacturing giant Cemex LatAm Holdings announced February 7 that its fourth-quarter (4Q) 2018 region-wide net profits fell 33% year-on-year, to US$10 million, from US$33 million in 4Q 2017.

But full-year 2018 profits improved 36% year-on-year, to US$63 million, from US$46 million in 2017, according to the company, which operates in Colombia, Panamá, Costa Rica, Nicaragua, El Salvador and Guatemala.

As for its Colombia operations, full-year 2018 sales slipped 7% year-on-year, to US$524 million, while 4Q 2018 sales dipped 6% year-on-year, to US$125 million, from US$134 million in 4Q 2017, according to Cemex.

Colombian sales of grey cement for full-year 2018 dipped 6% year-on-year, but rose 4% in 4Q 2018, while Colombian concrete sales fell 11% for full-year 2018 and by 8% in 4Q 2018.

Sales of aggregates in Colombia declined 14% for full-year 2018 and 15% in 4Q 2018 versus 4Q 2017, according to the company.

Cemex foresees 2019 demand for cement in Colombia either flat or rising by 1%, while demand for concrete and aggregates would rise by 1% to 3%, according to the company. Product prices also began to recover slightly in the Colombian market during 4Q 2018, according to the company.

Colombia’s residential-sector demand rose slightly during 4Q 2018, according to Cemex, especially in the “informal” and “self-built” housing segments.

For these lower-income “social housing” sectors, “there are encouraging signs for the future, given that sales and construction permits [in those sectors] through September 2018 rose by 5% and 15% respectively . . . supported by continuing government subsidies,” according to the company.

However, the middle- and upper-income housing sectors in Colombia continue to face challenges as new-starts and housing-permit applications had fallen 18% through September 2018, while inventories in these sectors remain relatively high, at 16-months turnover rate.

As for the Colombian infrastructure sector (highways, airports, tunnels, hospitals, sewage-treatment-plants, schools, marine ports), 4Q 2018 demand continued relatively strong, according to the company.

Cemex dispatched its products to 15 “fourth-generation” (4G) highway projects including the “Mar 1” and “Vias del Nus” projects in Antioquia, plus the “Autopista al Rio Magdalena 2;” “Bucaramanga-Barranca-Yondó;” “Bucaramanga-Pamplona;” and “Pasto-Rumichaca” projects. Cemex boasts that it achieved 36% market participation in 4G projects during 2018.

For the rest of 2019, Cemex expects demand for cement in Colombian infrastructure proejcts to rise by low-single-digits, including several large road-building projects in Bogota, according to the company.


Medellin-based multinational electric power giant EPM announced Tuesday, February 5, that it successfully shut the last water-intake tunnel at its giant Hidroituango hydroelectric dam, hence accelerating the planned diversion of the Cauca River over the dam’s engineered spillway by several weeks – and also enabling repairs to begin.

Temporarily, the decision means that downstream fish populations will be affected for about three days -- because the Cauca River still requires three more days to rise to the level of the engineered spillway at the top of the dam.

In a press conference, EPM general manager Jorge Londoño de la Cuesta explained that technical experts advised EPM to accelerate the closure of the water-intake tunnels in order to avoid a possible collapse of those tunnels.

Rising pressure differences between the water behind the dam and the water entering the tunnels would increase with rising water levels, threatening a potential tunnel collapse, the experts warned. Such a possible collapse would have prevented EPM from controlling water levels through the machine room, potentially wrecking the US$5 billion project and possibly endangering downstream populations.

As the last intake-gate was shut to the water tunnel, downstream water flows below the dam started falling drastically – to an estimated 35 cubic meters per second, down from around 450 cubic meters per second in recent days.

But flows should return to “summer-season” normal by next weekend (February 8-9) when the dam spillway outflow gradually restores normal Cauca River levels in the downstream area, he explained.

To reduce temporary impact on fish, EPM hired and trained 700 local fishermen to help rescue fish trapped in pools as water flow diminishes, he added.

In addition, EPM released extra water from its Porce hydroelectric dam system near Guatape, Antioquia, in order to boost river flows where the Nechi River meets the Cauca River at the town of Nechi, Antioquia, downstream from Hidroituango.

Cauca River flows have been decreasing in recent weeks because of the typically low-rainfall “summer season” of February and March. That decline in flow prompted EPM to hire local people to help rescue some 32,000 fish recently trapped in pools downstream of the dam.

Now that the final water-intake gate at the dam is closed, EPM personnel can start the process of entering the machine room, which has been flooded since last May because of an unexpected collapse in a nearby diversion tunnel. Since the dam and the spillway weren’t yet finished last year, EPM made an emergency decision to divert Cauca River water through the machine room, in order to avoid a dam collapse.

Since then, EPM and its engineering partners discovered a big hole that had opened between water-intake tunnels one and two, which lead to the machine room. The hole probably developed because of water erosion -- caused by the emergency evacuation of river water through the machine-room tunnels, according to EPM.

Now, EPM not only will have to repair damages to the machine room, but also to the water-intake tunnels damaged by erosion over the past 10 months.

The company still hopes to start-up the 2.4-gigawatt Hidroituango project by year-end 2021, which eventually would supply fully 17% of Colombia’s entire national electricity demand.

But EPM can’t be certain of the start-up schedule until it has the opportunity to inspect the damages in the machine room and the tunnels.

The city of Medellin gets nearly 25% of its entire annual budget from city-owned EPM. So, restoration and recovery of the Hidroituango project will be crucial to city finances in the coming decades.


The U.S. Embassy in Colombia announced February 4 that U.S. citizens living in Colombia and receiving Social Security retirement benefits now have to follow a new procedure to show “proof of life.”

 


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About Medellin Herald

Medellin Herald is a locally produced, English-language news and advisory service uniquely focused upon a more-mature audience of visitors, investors, conference and trade-show attendees, property buyers, expats, retirees, volunteers and nature lovers.

U.S. native Roberto Peckham, who founded Medellin Herald in 2015, has been residing in metro Medellin since 2005 and has traveled regularly and extensively throughout Colombia since 1981.

Medellin Herald welcomes your editorial contributions, comments and story-idea suggestions. Send us a message using the "contact" section.

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