Cementos Argos Full-Year 2022 Profits Drop 59% Year-on-Year

Medellin-based multinational cement/concrete giant Cementos Argos – a division of Grupo Argos – announced February 21 that its full-year 2022 profits fell 59% year-on-year, to COP$215 billion (US$33 million), from COP$524 billion (US$115 million) in 2021.

Gross revenues rose 19%, to COP$11.7 trillion (US$2.37 billion), up 23% year-on-year, compared to COP$9.8 trillion (US$1.98 billion) in 2021.

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) rose 6.6% year-on-year, to COP$2.08 trillion (US$421 million), but adjusted EBITDA  in U.S. dollars fell 6.2% year-on-year, to US$520 million in 2021.

Net profit from continuing operations dipped 14.4% year-on-year, to COP$403 billion (US$81.6 million), “mainly affected by the notable increase in financial expenses due to the increase in Interest rates,” according to Cementos Argos.

“On a consolidated basis, Argos shipped 16.2 million tons of cement, a slight decrease of 3.7% compared to 2021, mainly caused by effects on the industrial business in Central America and the Caribbean,” according to the company. On the other hand, concrete volumes rose 6.3%, to 7.5 million cubic meters, “highly leveraged by the good performance of the market in Colombia,” according to the company.

U.S. Operating Highlights

During 2022, U.S. cement shipments rose 4.4% year-on-year, to 6.1 million tons, while concrete shipments grew 1%, to 4.5 million cubic meters. Prices increased 16% in cement and 18% in concrete.

U.S. revenues rose 16.4%, to US$1.5 billion, but EBITDA dipped 4%, to US$256 million, “mainly due to significant increases in the variable costs of the operation as a result of the high inflation in energy prices,” according to Argos.

Colombia Highlights

In Colombia, cement volumes dipped 0.8% year-on-year, to 6 million tons, “as a result of the price recovery strategy in a context in which cement prices in Colombia continue significantly below the parity prices of imports,” according to Argos.

“Export volumes set a record at 1.2 million tons, with growth of 28.2%. Concrete volumes reached 2.7 million cubic meters, presenting a growth of 13.6%, driven by the construction of formal housing and the good dynamics of infrastructure projects. Local cement prices grew 19% and concrete prices increased 13%.”

As a result, Colombia operating income rose 11.8% year-on-year, to COP$2.7 trillion (US$546 million), while EBITDA rose 5.7%, to COP$605 billion (US$122 million), according to the company.

Central America, Caribbean and Trading

In Central America and Caribbean operations, cement shipments fell 18% year-on-year, to 4 million tons, but concrete shipments rose 42.5%, to 273,000 cubic meters.

“Prices increased an average of 14% in concrete and 29% in cement, due to the global dynamics of trade that led to the highest values of import parity in markets with high exposure to international supply,” according to Argos.

Central America and Caribbean region revenues rose 3.1% year-on-year, to US$541 million, while EBITDA dipped 8.1% year-on-year, to US$123 million.

“With higher price levels and more stable inflation, Cementos Argos expects to be able to capture the opportunities that arise in the Central America, Caribbean and trading regions in 2023,” the company added.