Cementos Argos reports in its 3Q17 results that consolidated cement volumes reached 4.2Mt, with a 16.7 per cent increase driven by positive dynamics in the company's operating regions and the consolidation of the Martinsburg plant operation. Concrete volumes decreased 6.1 per cent, due to the performance of Texas and Colombia.
The adjusted EBITDA, excluding no-recurring items associated to the BEST programme, closed in COP428bn (US$143.2m), compared to COP398bn in 3Q16, with a 19.5 per cent margin. Despite a 42 per cent decrease compared to the same period of 2016 with respect to net income, Cementos Argos reached net inocme of US$22m during the quarter.
Colombia
In the company's domestic market, cement volumes grew 1.6 per cent while in the concrete market a slow dynamic remains. In addition, total cement and clinker imports into Colombia decreased 62 and 35 per cent, respectively in 2017. This was the consequence of an increase in import parity prices and a five per cent tariff on imports, says Cementos Argos.
USA
Cement dispatches grew 5.7 per cent excluding the Martinsburg operation, well above the total US market growth (3.4 per cent YoY as of August without considering Texas). The 5.7 per cent reduction in ready-mix during the quarter is explained by a decrease in the south central region and a stable market in the southeast. In September hurricanes caused a reduction of 8.9 per cent in cement volumes ex-Martinsburg and of 11.3 per cent in ready-mix in the south central region.
In Houston 17 of 18 ready-mix plants are operating normally now, and in Florida the integrated plant in Newberry and the grinding facilities in Tampa and Port Manatee are in good condition.
During the quarter the adjusted EBITDA was US$73.5m, with a 18.2 per cent margin. These figures were under budget because of the weather conditions, which is why the new guidance for 2017 is an EBITDA of around US$230m-240m, down from the US$260m-280m previously announced.
Caribbean
Cement volumes increased despite the impact of hurricanes and were driven by the performance of Honduras (+17 per cent) and the eastern Caribbean (+10 per cent).
In Puerto Rico the integrated plant is remains out of operation. In the Antilles, although still under evaluation for the definite impacts in the terminals, imports have already started.
In Honduras the country is expected to continue the execution of infrastructure and housing projects through the 20/20 programme, which seeks to build 1m housing units and provide incentives to the tourism development sector. Similarly, in Panama Argos maintains a positive outlook and expects a recovery in infrastructure supported by a healthy fiscal position and an attractive pipeline of projects.
