Cementos Pacasmayo SAA Q2 FY2025 earnings call

• Quarterly sales volume saw a 7.1% year-over-year recovery due to stronger demand for cement and concrete in infrastructure projects. Consolidated EBITDA was $130.2 million, a 9% increase y-o-y despite increased expenses from collective bargaining. - Focus on infrastructure projects, highlighting Peru's infrastructure and housing deficit and the company's role in addressing it via Obras por Impuestos program. - Recognized as top-ranked cement company in MERCO Talent index for 7th consecutive year. - Revenues for the quarter were PEN 484.1 million, up 5.9% y-o-y; gross profit up 11.2% y-o-y; EBITDA up 9% y-o-y.

Sales of cement increased 6.3% this quarter compared to the same period last year, with gross margin increasing 3.2 percentage points. For the first 6 months of the year, cement sales were up 5% and gross margin rose 2.9 percentage points. Concrete, pavement and mortar sales increased 9.8% this quarter due to projects like Piura Airport, but gross margin decreased 3.2 percentage points. For the first 6 months, these sales were up 16.1% but gross margin dropped 4.8 percentage points. Precast materials sales increased 4.1% this quarter and 5.3% in the first 6 months, but gross margin was lower by 1.5 and 1.6 percentage points respectively.

• Volumes expected to remain in high single digits for the second half, dependent on infrastructure project timings. - CapEx: Sustaining CapEx around PEN 100 million annually for plants and ready-mix plants, with no substantial capacity increase planned. - EBITDA margin expected to remain between 28% and 29%. - Dividends: Consistent with previous years, no major changes anticipated.

• Delays in infrastructure project start-ups could affect volume and margin expectations. - Exchange rate fluctuations, such as those impacting the Piura Airport project's margin due to differences between projected and real exchange rates.

Q: What are expectations for volumes going forward and CapEx for the second half?

A: Volumes expected to remain in high single digits depending on infrastructure project unveiling; CapEx sustaining at around PEN 100 million annually for sustaining CapEx with no substantial capacity increase.

Q: What could be expected for margins in the second half versus the first half?

A: EBITDA margin expected to remain between 28% and 29%.

Q: What are the company's expectations for dividend distribution in 2025?

A: Dividends consistent with previous years, with no reason to change and higher chance of remaining at current level or increasing.

Q: Does CEMEX using Chancay ports change competitive dynamics in the Peruvian market?

A: Chancay port may slightly impact northern market, but main competitive dynamics influenced by Salaverry and Paita ports.