For the fourth quarter of 2023, Argos' adjusted EBITDA stood at COP676bn (US$172.2m), increasing 12 per cent compared to 4Q22. The results were driven by strong pricing dynamics, especially in the US, combined with cost efficiencies in both Colombia and the US. Adjusted EBITDA margin stood at 23.2 per cent for the quarter, increasing 393 basis points versus 2022 on a comparable basis.
In terms of volumes, total cement dispatches reached 3.8Mt, with a contraction of 2.3 per cent, caused by slightly weaker local market demand in Colombia, country-wide protests in Panama ,and the social and political context in Haiti. Ready-mix volumes stood at 1.5Mm3, decreasing 13.3 per cent LfL versus the 4Q22, partly due to some continued softening in demand in Florida and Texas and Colombia.
USA
The increase in FOB prices of 13.1 per cent in cement and 16.6 per cent in the ready-mix segment in the 4Q23, coupled with the ongoing implementation of the company's profitability-focussed strategy in both segments led to an accumulated EBITDA 46.3 per cent higher than in the 4Q23. On the same line, for the fourth quarter, EBITDA increased by 53.5 per cent and EBITDA.
During the quarter cement volumes increased 1.3 per cent while ready-mix dispatches decreased 10.6 per cent on a LfL basis, compared to the 4Q22, mostly due to the constant quest for profitability and some continued softening in demand in Florida and Texas. Despite operational disruptions previously disclosed at the Newberry plant, which have since been addressed, cement volumes for the year remained stable compared to those observed last year.
Colombia
Prices in the cement business increased 14.1 per cent YoY and in the ready-mix business the increase was of 21.1 per cent YoY. Cement exports from Cartagena increased 12.4 per cent, reaching 1.358Mt YtD and representing a historic high for the division. However, the local market cement volumes decreased 7.2 per cent during the year compared to the 4Q22. Ready-mix volumes fell 10 per cent YoY. "The contraction on volumes is mostly due to the country-wide reduction of cement dispatches for the year," said Argos.
Total EBITDA reached COP207bn for the 4Q23 and increased 14.1 per cent compared to the 4Q22. Pricing dynamics continued to lead to a strong top line, which in addition to the operational efficiencies, cost discipline and efforts to reduce distribution costs, were all fundamental to achieve an EBITDA margin of 28 per cent, 179 basis points above last year.
Central America
Local market cement dispatches during the 4Q23 decreased 8.3 per cent in Central America mainly affected by country-wide protests carried out in Panama during the quarter, while in the Caribbean volumes posted a slight decline of 0.4 per cent, resulting from the combination of the strong performance in the Dominican Republic market that was offset by the deterioration of the political and social situation in Haiti. Trading volumes saw a 21 per cent YoY decline, mainly due to a higher utilisation of Argos’ export capacity from Colombia. Regarding cement pricing dynamics, in local markets average prices remained stable YoY posting a one per cent increase.
The financial performance of the region was affected during the quarter by the social and political situation in Haiti and the protests in Panama, with an EBITDA contraction of 12.7 per cent and EBITDA margin of 22.4 per cent.
