Loma Negra (LOMA) Q2 2026 Earnings Call Transcript

Loma Negra reported Q2 consolidated net revenue of Ps. 238.1B (+2.1% YoY), but adjusted EBITDA fell 2.5% YoY to Ps. 48.2B and the adjusted EBITDA margin contracted 97 bps to 20.2% amid higher costs and depreciation. Net profit surged to Ps. 7.5B vs Ps. 0.5B a year earlier, mainly from lower financial expenses and reduced FX losses, while net debt improved to $185M (Ps. 274B) with leverage down to 1.3x from 1.47x. Management flagged ongoing weakness in bagged cement demand and expects a recovery path that is unlikely to be linear, but cited potential volume support from RIGI projects/road concessions and September kiln restarts under better energy contracts.

Analysis

Near term, the setup is more about timing than thesis. The stock is being pulled between a weak volume backdrop and a cleaner cost picture: the market will likely focus first on margin pressure from energy, labor, and depreciation, but those are exactly the items that can reverse if kiln utilization rises and the winter-related freight spike fades. The key mechanism is operating leverage: a low-single-digit volume rebound into the seasonally stronger September-November window should matter more for EBITDA than the current quarter suggests.

The bigger medium-term question is whether public works and retail demand are merely deferred or structurally slower. If RIGI-driven projects and easier credit actually convert into starts, the winners are not just LOMA but also rail-linked freight, industrial suppliers, and local contractors that can ride a narrower but higher-margin bulk mix. Conversely, if bagged cement demand stays weak, the company’s pricing power becomes less durable because retail is where margin expansion usually gets capped by substitution and volume leakage.

Balance-sheet risk is manageable, so this is less a solvency story than a dispersion story versus Argentine domestic cyclicals. The fact that dollar debt is still high means any renewed peso weakness can obscure operating improvement, while a stabilization of FX would make earnings look cleaner even without huge operating gains. The contrarian view is that consensus may be over-discounting the next 1-2 quarters and underestimating how much margins can snap back once fixed costs are absorbed; the falsifier is simple: if September dispatches do not inflect and energy contracts fail to offset winter cost drag, the recovery narrative likely pushes out another 2-3 quarters.

Key Decisions for Investors

• Watchlist rather than immediate buy: wait for evidence that September dispatches and Q3 utilization inflect before adding to LOMA; the stock should only be owned aggressively if volumes improve while EBITDA margin stabilizes above the low-20% area.
• If already long LOMA, use any rally into the next 4-8 weeks to trim 20-30% of exposure unless management shows concrete RIGI/project order flow; this is a timing trade, not a clean secular rerating yet.
• Pair trade idea: long LOMA / short an Argentina domestic-demand proxy only if construction indicators improve for 2 consecutive months; if not, avoid the pair because both legs are too macro-beta-sensitive.
• For more risk-tolerant accounts, consider call spreads on LOMA into the September kilns restart catalyst, sized small; thesis only works if lower energy costs and higher throughput show up quickly, and it is falsified by another soft monthly dispatch print.
• Set a hard alert on margin recovery: if consolidated EBITDA margin does not re-expand in Q3 despite higher volumes, the market is likely to re-rate the name lower on the view that pricing is not enough to offset structural cost inflation.