Pacasmayo reports 6.7% rise in 3Q income

Cementos Pacasmayo increased its deliveries of cement, concrete and blocks by 4.8 per cent YoY in 3Q17 due to a higher level of self-construction activity and the recovery in public spending towards the end of the quarter.

The Peru-based cement producer reported a 6.7 per cent YoY advance in income to PEN334.7m (US$103m) as a result of increased sales volumes and higher prices. Consolidated EBITDA increased 38.9 per cent QoQ to PEN107.2m and the EBITDA margin rose from 27.6 per cent in 2Q17 to 32.2 per cent.

However, the company's gross margin retreated 2.7 percentage points YoY to 40.1 per cent as raw material prices increased following El Niño damage.

For the first nine months of 2017, Pacasmayo reported a YoY decrease in revenues of 2.8 per cent and a gross margin of 39.8 per cent, one percentage point lower than 9M16. Consolidated EBITDA was 7.7 per cent lower at PEN266.9m while EBITDA margin fell by 1.5 percentage points to 30 per cent due to a lower operating profit.

Net income of continuing operations declined 24.6 per cent to PEN82.3m as sales fell and the operating margin contracted in the first four months of the year. In addition, El Niño damage caused expenses to increase.

Looking ahead, Cementos Pacasmayo noted that the investment in the reconstruction due to the effects of El Niño has not yet begun, so growth is expected to accelerate in the short term. "This quarter reflects the gradual recovery of the impact of El Niño coastal to offer progressive improvements in EBITDA with a steady increase in profitability," said the company in a statement.