Argos sees higher volumes in 1H13

Argos sees higher volumes in 1H13
Published: 23 July 2013

Cementos Argos has reported a rise in cement volumes for the six months to the end of June 2013 and expects activity in its domestic market of Colombia to accelerate after a slow start in the first three months.

In the 1H13, Argos reported consolidated EBITDA of COP476bn (US$253m), representing an increase of 25 per cent compared to the same period in 2012, while revenues rose nine per cent YoY.

During the period cement dispatches increased by one per cent to 5.5Mt while concrete volumes were up by seven per cent to 4.4Mm3.

Argos reported that its Colombian division experienced more dynamic market trends in the second quarter, as volumes rose four per cent compared to the previous quarter. The 1H13 saw an overall four per cent decline in cement dispatches YoY as 1Q volumes fell by eight per cent. However, Argos is confident that the recovery seen in the second quarter will continue as infrastructure and housing projects start to materialize. Latest figures from the National Administrative Department of Statistics (DANE) showed construction licenses increased by 37.2 per cent in April  and 22.3 per cent in May, reaching an accumulated growth of 30.5 per cent up to May 2013.

Argos reported that there has been much progress in the implementation of the government’s “shock plan” (plan de choque) that was announced in April this year which seeks to accelerate construction and hiring processes to incentivise economic growth. Furthermore, 100,000 free homes will be offered by the government to Colombians with limited resources. Up until June 2013, around 84,931 of these homes had been allotted to construction companies and Argos participated in about 46,681 (55 per cent) of the total amount by supplying cement and concrete. These houses, together with another 18,077 that are currently being negotiated would represent 76 per cent of the houses allotted to-date.

US cement sales in the first half rose by one per cent with dispatches totaling 799,000t. Argos noted that the US market continues to show encouraging signs and it remains optimistic for the market. 

The Caribbean division recorded a two per cent increase in grey cement volumes. Cement sales in Panama, Argos’ main market in the region, increased nine per cent. A 30 per cent rise in sales volumes was recorded in the Dominican Republic as the government there is undertaking multiple initiatives to revitalise the economy. Haiti also reported a satisfying performance while cement volumes in Suriname rose five per cent due to infrastructure projects currently under construction.