LOMA

Market and Macroeconomic Context

• Argentina's monthly economic activity indicator grew 1.6% YoY in April 2026, slowing to 0.2% YoY in May with a 0.5% monthly decline; cumulative growth through the first five months of the year is 1.7% YoY, a moderation from earlier in the year
• Construction activity followed a mixed trend: declining 2.8% YoY in April due to heavy rains, rebounding 0.1% YoY in May; leading indicators are constructive, with construction sector private employment up 1.2% YoY in April and building permits up 17% YoY that month
• Overall industry cement dispatches declined 5% YoY in Q2, while Loma Negra volumes declined only 1.4% YoY, outperforming the broader market

Consolidated Financial Performance

• Consolidated adjusted EBITDA reached 48.2 billion pesos ($38 million), down 2.5% YoY, with EBITDA margin contracting 97 basis points to 20.2%; dollar-denominated EBITDA per tonne rose 14% YoY to $32.10, demonstrating operational resilience
• Net profit attributable to shareholders totaled 7.5 billion pesos, up from 0.5 billion pesos YoY, driven by lower foreign exchange losses on US dollar-denominated liabilities despite softer operating performance
• As of quarter-end, net debt stood at $185 million (274 billion pesos), with a net debt to adjusted EBITDA ratio of 1.3x, down from 1.47x at end-2025; the company completed $10 million in Class 4 corporate bond cancellation, leaving no remaining structured debt maturities for the rest of 2026
• Operating cash flow was 18.1 billion pesos in Q2, compared to a 29.7 billion pesos outflow YoY, driven by improved working capital from lower income tax payments; CapEx totaled 9.7 billion pesos, remaining low after completion of the 25-kilogram bagging project

Operational Milestones

• The 25-kilogram bagging project, mandated by new labor safety regulation to replace 50-kilogram bags, was fully capitalized by mid-2025, with full implementation completed in 2026; the project required over $5 million in total investment
• The Bahía Blanca rail section damaged in a 2025 storm has been repaired, enabling resumption of full railroad operations
• Loma Negra celebrated its 100th anniversary in August 2026

• Management maintained its prior expectation of a gradual, uneven demand recovery through the second half of 2026, confirming the underlying positive demand trend remains intact despite first-half volume coming in below initial expectations
• Management expects incremental volume growth in the second half of 2026, supported by new infrastructure projects moving forward under Argentina's RIGI regime, recently awarded government road concessions, and the historical trend of Q4 being the strongest quarter for cement dispatches
• Additional tailwinds for second-half volume growth are expected from potential easing of monetary conditions, improving real wages, and a recovery in credit availability
• Management expects margin upside in the second half of 2026 from fixed cost dilution if incremental volume materializes, and favorable contracted energy pricing for resumed kiln operations starting in September

Loma Negra's consolidated net revenue for Q2 2026 increased 2.1% year-over-year (YoY) to 238.1 billion pesos. Segment performance is as follows:

1. Cement: Revenue increased 2.2% YoY, while volume decreased 1.4% YoY. Bulk cement dispatches outperformed bagged cement, which remained under pressure from weak retail segment demand. Adjusted EBITDA margin for the segment was 23.9%, down 81 basis points YoY, with higher costs partially offset by favorable pricing. This segment contributed approximately 91% of consolidated revenue (based on segment performance weighting).
2. Concrete: Revenue decreased 11.2% YoY, driven by an 18.6% YoY volume decline, partially offset by favorable pricing. Volume weakness stemmed from completed large infrastructure projects with new projects delayed. Adjusted EBITDA margin expanded 867 basis points YoY to -4.3%, remaining negative but improved significantly.
3. Aggregates: Revenue decreased 10.3% YoY, alongside a 12.2% YoY volume decline, partially offset by favorable pricing. Weakness stemmed from the same demand pressures impacting the concrete segment. Adjusted EBITDA margin improved 877 basis points YoY to -18.6%, remaining negative but showing improvement.
4. Railroad: Revenue increased 8.6% YoY, as transported volumes rose 10.1% YoY, partially offset by softer pricing. Volume growth was driven by resumption of operations after storm damage repairs the prior year. Adjusted EBITDA margin turned negative to -5.2%, down from 9.8% positive YoY, due to higher fuel, labor, and depreciation costs.

• Continued limited credit access could delay the expected demand recovery in the retail and small contractor segments
• Demand for construction materials remains volatile, with potential short-term volume declines possible as the recovery is not expected to be a linear trend
• Sustained high fuel and freight costs could continue to pressure operating margins
• The 25-kilogram bag packaging change created permanent incremental packaging, labor, and depreciation costs that must be offset by pricing increases and volume growth

Q: If credit access remains limited in the second half of 2026, what other factors will drive activity? / A: Management notes credit improvement in H2 is uncertain, but other factors will support volume growth. Several RIGI regime project approvals and recently awarded government road concessions are starting to move forward, and are expected to contribute incremental volume in the coming months. September through year-end is historically the strongest period for cement dispatches, which will also support seasonal volume gains.

Q: Can you break down Q2 cost headwinds into temporary/seasonal versus recurring costs, and what levers will drive margin recovery? / A: Higher freight costs from elevated winter fuel prices are a temporary seasonal headwind for the quarter. Recurring incremental costs stem from the new 25-kilogram bagging operations, including higher packaging costs, increased labor needs, and new depreciation from the project investment. Margin upside will come from contracted better-priced energy for kilns restarting in September, and fixed cost dilution from expected incremental H2 volume.

Q: Can you share additional details on the 25-kilogram bag project implementation, its commercial impact, and current progress? / A: The switch from 50-kilogram to 25-kilogram bags was required by new occupational safety regulation, as mechanical handling support for heavy bags was not feasible across the supply chain. Two 25-kilogram bags have higher total packaging and operating costs than one 50-kilogram bag, so the full transition to the new packaging was required to pass through these incremental costs to the market. Total investment for the project exceeded $5 million, and the transition was completed successfully after multiple regulatory extensions.