Poor Colombian market hits Cementos Argos sales volumes in 2016
Cementos Argos’s sales volumes of cement fell by 5.5% year-on-year to 3.44Mt in 2016 from 3.64Mt in 2015. Despite increasing its presence in the US with the acquisition of the Martinsburg, West Virginia cement plant, its sales volumes in Colombia fell by 19% in 2016, more than the market, due to its ‘higher exposure’ to the infrastructure and industrial segments and increasing volumes of imports. Despite this, its sales revenue rose by 7.7% to US$2.95bn from US$2.74bn and its earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 8.7% to US$572m from US$526m.
“We are very satisfied with the results of the US regional division, as they ratify the visionary decision taken 11 years ago by the company, to enter with our value proposition into the largest economy and the most demanding market. Our diversification strategy allows us to balance different market cycles, drives our results and supports value generation for our shareholders,” said Juan Esteban Calle, chief executive officer of Cementos Argos.
The US became the cement producer’s biggest market in 2016 contributing about half of its revenue. By region, cement sales volumes grew in the US by 18.5% to 3.97Mt from 3.36Mt. Sales volumes in its Caribbean and Central American region rose by 4.7% to 4.95Mt from 4.73Mt. It added that it had decided to postpone the expansion of its Sogamoso cement plant in Colombia. Instead it plans to increase its production capacity by 1Mt at its Rioclaro and Cartagena plants in 2017 and 2018.
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