Loma Negra Compania Industrial Argentina Q4 Earnings Call Highlights

Loma Negra Compania Industrial Argentina (NYSE:LOMA) reported fourth-quarter 2025 results that reflected a year-end environment of soft demand and a slower-than-expected recovery in Argentina’s cement market, while management pointed to improving pricing sequentially and a stronger balance sheet position entering 2026.

Fourth-quarter operating backdrop and headline metrics

CEO Sergio Faifman said the fourth quarter “largely mirrored” trends seen earlier in the year, with cement dispatches down 1.2% year-over-year. He characterized 2025 as a year of “gradual recovery” for the Argentine economy and, to a lesser extent, the cement industry, but noted the rebound “progressed more slowly than we initially anticipate and lost some momentum in the second half of the year.”

For the quarter, net revenue totaled ARS 225 billion (about $152 million), down 1.7% from the fourth quarter of 2024. Faifman said results were broadly stable sequentially, with the company “virtually narrowing the gap observed early in the year.”

Consolidated adjusted EBITDA was $37 million in the quarter, with a 19.7% margin. Management emphasized that the year-over-year comparison was difficult because margins in the prior-year period were “exceptionally strong.” For the full year 2025, adjusted EBITDA was $146 million with a 21.3% margin, representing a 454-basis-point contraction versus 2024.

Market review: economic growth, construction and cement demand

CFO Marcos Gradin pointed to Argentina’s monthly economic activity indicator (EMAE) showing a 3.5% year-over-year increase in the latest release, contributing to full-year 2025 economic growth of 4.4%. However, he highlighted divergence across sectors: agriculture, mining, and financial intermediation were among the strongest contributors, while industry and commerce remained pressured. Construction activity was “broadly flat” versus the prior year.

Gradin said the cement industry posted a broadly flat quarter and closed 2025 with 5.6% growth, but the pace moderated after a stronger start. He attributed weaker momentum to the electoral process and uncertainty, along with financial and foreign-exchange tensions that affected the recovery.

By segment, he said bulk cement outperformed due to larger-scale projects, including residential developments and logistics and infrastructure works. Bagged cement (retail) volumes contracted, reflecting weaker demand among individuals and small contractors in a context of monetary tightening and interest-rate volatility.

Looking into 2026, management said it will be important to monitor demand in March and April. Gradin described the start of the year as “relatively weak” due to summer seasonality and “still cautious activity levels,” while also expecting recently announced investment initiatives—such as infrastructure programs, road corridors, and mining and energy projects—to begin supporting volumes after the summer period.

Segment performance: pricing, volumes and profitability drivers

On the top line, fourth-quarter revenue declined 1.7% year-over-year. Gradin said the cement segment drove the decrease, while concrete posted strong growth.

• Cement, masonry cement and lime: Revenue fell 4.4% year-over-year, mainly due to “softer pricing conditions” versus a strong prior-year comparison. Prices improved sequentially for a second consecutive quarter, extending a real-term recovery, while volumes declined 1.2% year-over-year. Management said bulk continued to outperform, while bagged cement lagged due to subdued retail demand. Gradin also noted that the segment includes masonry cement and lime, which tend to follow bagged cement dynamics, affecting comparisons to industry statistics focused on gray cement volumes.
• Concrete: Revenue rose 37% year-over-year, driven by a 62% increase in volumes, partially offset by competitive pricing. Growth was supported by infrastructure works in Santa Fe and private logistics-related developments.
• Aggregates: Revenue was essentially flat, down 0.9% year-over-year. Volumes increased 8.2% due to road construction and railroad-related activity, but pricing and mix—particularly a higher share of lower-priced fine aggregates—offset the volume benefit.
• Railroads: Revenue declined 8.9% despite a 2.8% increase in transported volumes. Weaker pricing and ongoing disruption of the Bahía Blanca rail line reduced longer-haul traffic and ton-kilometers, affecting shipments including grain, gypsum, and frac sand.

For full-year 2025, consolidated revenue declined 7.8% to ARS 848 billion from ARS 920 billion in 2024, while cement volumes increased 2.5%.

On profitability, consolidated gross profit fell 29.1% in the quarter and gross margin contracted 906 basis points to 23.5%, though management noted sequential margin recovery versus the prior quarter. Cost of sales increased 11.5% year-over-year, driven by higher cement costs and higher depreciation after completion of the 25-kilogram bagging project.

Gradin said cement cost of sales increased 12% year-over-year due to higher maintenance and use of spare parts and supplies, as well as packaging costs tied to the 25-kilo program. Energy inputs, particularly thermal energy, continued to support cost management, and on a sequential basis unit costs including depreciation were nearly flat, increasing 0.8% quarter-over-quarter.

Adjusted EBITDA fell 33.4% year-over-year to $37 million (ARS 44 billion), with the margin down 938 basis points to 19.7%. The cement segment’s adjusted EBITDA margin was 22.7% versus 37.7% a year earlier, pressured by higher costs and softer pricing. Concrete and aggregates remained in negative margin territory despite improvements, while the railroad segment’s margin improved to 1.9% from -0.4%.

Net income, balance sheet and financing

Net profit attributable to owners was ARS 6.2 billion, down from ARS 29.5 billion in the fourth quarter of 2024. Gradin said the decline reflected weaker operating performance and a lower net financial result as inflation impacts normalized, partially offset by lower income tax expense.

The company recorded a net financial loss of ARS 9.8 billion in the quarter, compared with a net financial gain of ARS 1.1 billion in the prior-year period, primarily due to a lower gain from net monetary position in a more normalized inflation environment. Net financial expenses decreased 2.1% to ARS 14.4 billion, which management attributed primarily to higher financial income from stronger average cash balances.

Net debt ended the quarter at ARS 266 billion, with a net debt-to-EBITDA ratio of 1.47x (up from 0.89x at the end of 2024). In U.S. dollar terms, net debt was $183 million, down $23 million sequentially, with an average duration of one year. Management said 85% of total debt was denominated in U.S. dollars.

After quarter end, in January 2026, the company issued a new Class 6 corporate bond for $60 million with a 33-month term. Gradin said the issuance was multiple times oversubscribed and carried a 6.5% interest rate, and that it fully covers the company’s U.S. dollar maturities for the year.

2026 commentary: volumes, pricing momentum and energy strategy

In Q&A, management reiterated it does not provide formal guidance on margins, EBITDA, or pricing. On volumes, Faifman said the company expects 2026 to be “a year of growth,” despite January and February being below prior-year levels. He attributed early-year softness to activity being “lagged in time,” seasonality, and February holidays. He said average daily dispatches were similar to last year and that the company is participating in multiple tenders that should begin impacting volumes in the coming months. He characterized expected volume growth as single-digit in the “high range.”

On pricing, Faifman said the company began a recovery process in the second half of 2025, visible in fourth-quarter figures, and said the tendency continued into the first months of 2026, assuming no sudden changes.

On energy management, Faifman said the company’s thermal energy mix is primarily natural gas and cited lower gas costs linked to increased production from Vaca Muerta. He said Loma Negra had already closed natural gas contracts running from October through April 2027 at prices lower than contracts signed a year earlier, and that the company also signed some multi-year contracts on a smaller scale. For electricity, he said the company is increasing the share of renewable energy in line with sustainability goals, noting it reached 67% last year and was above that level in the first quarter of 2026, with an additional renewable contract signed last year beginning this year at what he described as a “very good price.”

Separately, the company highlighted the release of its fifth sustainability report, including a 22% reduction in CO₂-equivalent emissions versus a 2021 baseline and progress on waste valorization and water and air-quality metrics. Management also noted 2025 marked Loma Negra’s 100th anniversary.

About Loma Negra Compania Industrial Argentina (NYSE:LOMA)

Loma Negra Compañía Industrial Argentina SA is the leading cement producer in Argentina, with a history dating back to its founding in Buenos Aires in 1926. The company operates an integrated network of cement and lime plants, as well as quarries and ready-mix concrete facilities. Its operations encompass the extraction of limestone, the production of clinker, hydraulic cement and quicklime, and the distribution of aggregates and concrete for a wide range of construction projects.

The company’s product portfolio serves residential, commercial, industrial and public infrastructure markets across Argentina.