Mar 8, 2022
Operator
Good morning and welcome to Loma Negra, Fourth Quarter 2021 Conference Call and Webcast. All participants will be in listen-only mode.
After today's presentation, there will be an opportunity to ask questions. Also, Mr.
Sergio Faifman will be responding in Spanish immediately following an English translation. Please note that this event is being recorded.
I would now like to turn the conference over to Mr. Diego Jalón, Head of IR.
Please go ahead, Diego.
Diego Jalón
Good morning and welcome to Loma Negra earnings conference call. By now, everyone should have access to our earnings press release and the presentation for today's call, both of which were distributed yesterday before market opens.
Joining me on the call this morning will be Sergio Faifman, our CEO and Vice President of the Board of Directors and our CFO, Marcos Gradin. Both of them will be available for the Q&A session.
Before I turn the call over to Sergio, I would like to make the following Safe Harbor statements. Today's call will contain forward-looking statements, and I refer you to the forward-looking statements section of our earnings release and recent filings with the SEC.
We assume no obligation to update or revise any forward-looking statements to reflect new or changed events or circumstances. This conference call will also include discussion on non-GAAP financial measures.
The full reconciliation to the corresponding financial measures is included in the earnings press release. Now, I would like to turn the call over to Sergio.
Sergio Faifman
Thank you, Diego. Hello, everyone.
And thank you for showing us today. I will begin my presentation with a discussion of the highlights of the quarter.
And then Marcos will take you through our market review and financial results. After that, I will provide some final remarks and then we will open the culture question.
Starting with Slide 3, we are satisfied to share another solid quarter. Closing a year, we saw not only a bonus in the month from last year drop, but a year of robust activity in the construction sector, which in slightly below cement industry all-time height (ph) among challenging macroeconomic environment.
In this context, our assessment EBITDA for the quarter, which is $63 million compared with $58 million in full quarter FY 20. When measured in pesos, it showed a decline of 10% year-over-year.
When looking to our annual fee rates, we achieved $215 million for the fiscal year 2021 from $179 million in 2020, achieving a new record for our operation in Argentina. We are committed to continue delivering strong results a world-class EBITDA margin on the back of our competitive leadership on efficiency production standard.
In the sense, they use dollar EBITDA bolt-on, which is $38 in the fourth quarter, 3% above 2020's fourth quarter. Finally, we are proved to share that this past quarter, we inaugurate the second line of L'Amali plant.
Its completion represents a significant milestone for our company that would support our strategy and will allow us, to continue increasing production efficiency and profitability. I will now hand off the call to Marcos Gradin, who will walk you through our market review on finance sale stat.
Please, Marcos, go ahead.
Marcos Gradin
Thank you, Sergio. Good day, everyone.
As you can see on Slide 4 after a drop of GDP in 2020 due to their pandemic restriction, we saw a sharp recovery starting in the second quarter that led the growth estimates for 2021 to approximately 9.7%. On the bulk of this economic rebound, construction activity measured by the ISAC increased sharply to 30.8% for fiscal year 2021.
Also showing a solid performance in recent month by 32% are more moderate growth rate. Reevaluate cement, national industry sales, particularly in the second quarter of the year, show a solid demand pushing 2021 accumulated figures almost at record highs.
Even though the initial boosters and recovery came from residential demand, and it's made back cement take a prominent stake of the total dispatches, bulk has weatherly recovered. Breaking down the consumption by dispatch mode, we observed figures in line with historical average.
The first two months of this year, our ratio in the seventh month continues in its upward trend. For the year, we remain capture the optimistic as economic growth in Argentina is overshadow by short-term macro-economic challenges, and sometimes, we've shared the back future scenarios.
Turning to Slide 5, for a review of our top line performance by segment. Top-line was down 3.8% in the fourth quarter, mainly due to a decrease in 7th revenues partially offset by railroad and aggregates.
Cement measure is 7 ton, 9th segment was down 4.8% with volumes expanding 3.5% year-on-year. We have a softer pricing dynamic.
Concrete revenues remain almost flat for the quarter. What is dropped due to an extraordinary infrastructure work in fourth-quarter FY 20, compensated by a good price performance?
Aggregates showed sharp revenues recovery of 51.9%. Volume expanded 14% on the back of road works demand, coupled with our recovery pricing.
Finally, railroad revenues increased 8.1% during the quarter versus the same quarter of last year. Although volumes were down 3%, prices and other product mix, more than compensated that effect.
For the whole year, consolidated revenues were up 17.3% to AR$73.7 billion from AR$62.8 billion each of us in FY 20. Volumes expanded sharply across all segments.
Moving on to Slide 7. Consolidated gross profit for the quarter declined 7.9% year-over-year with merging affected by 152 basis points to 34.6%.
Mainly impacted by a lower top line performance of our core segment. Same in gross margin, operation was slightly offset by a better performance of concrete and aggregates that show an improvement from last year's heavily impacted results.
SG&A expenses as a percentage of revenues increased by 202 basis points to 9.9% from 7.9%, mainly due to our recognition of our allowance for doubtful receivables in the regular segment, and higher marketing expenses. Without considering the preliminary effect of the segment, SG&A’s percentage of revenues would have been 8.9%.
During the year, gross profit improved sharply by 22.5%, our margin expanded 134 basis points. Please Turn to Slide 8, our adjusted EBITDA for the fourth quarter stood at $63 million up 9.1% from $58 million in the same quarter a year ago, boosted by our top line.
In pesos EBITDA was down 10% in the quarter reaching AR$6.4 billion, with consolidated EBITDA margin of 33.3% constructed by 231 basis points year-on-year. Cement segment adjusted EBITDA margin reached 37.4%, margin contracted by 306 basis points, mainly due to a softer pricing dynamic, partially offset by lower production costs and an increase in sales volume.
When compared to previous quarter, margin expanded 793 basis points. In our vertical basis, EBITDA reached a top notch level of $38, increasing 3.3% from fourth quarter of 2020.
Concrete adjusted EBITDA increased AR$345 million compared to fourth quarter of FY20 mainly explained by our positive price performance with margin in positive grounds at 6% from last year's negative figures. Aggregates adjusted EBITDA improved from AR$-22 million pesos in fourth quarter to AR$-4 million in first quarter 2021, showing a negative margin of 1.2% favored by a better pricing mix and carrier sales volume.
Finally, railroad adjusted EBITDA decreased AR$193 million to AR$-201 million for the quarter. With a negative margin of 12.9% mainly due to the impact producer recognition of an allowance for doubtful receivables of AR$187 million.
For the Full-Year 2021 adjusted EBITDA show an increase of 15.4% from 2020, with margin reaching 31.4%. When measured in U.S.
Dollars, our EBITDA reached outstanding figure of 215 million, setting a record high for the operation in Argentina. Moving on to the bottom line on Slide 10, our profit for continuing operations to that AR$2.8 billion.
Decreasing 37% year-on-year, mainly due to a lower operational result and the impact of higher total financial cost. Total financial cost to that AR$0.1 billion in fourth quarter FY 21, compared to a net gain of AR$0.9 billion last year.
As a result of our lower gain, exchange rate difference due to a lower depth in U.S. Dollars and a lower gain on the net monetary position.
Additionally, our net financial expense increased by AR$0.2 billion to AR$0.4 billion, compared to same quarter last year, driven by lower effect -- depreciation effect compared with the evolution as inflation rate. Net profit attributable to the owners of the company reached to Mx$2.9 billion, contributing to net profit of Mx $ 6.6 billion for Full-Year 2021.
Please note that the Full-Year comparison is affected by extraordinary result as an investment in Parawai in fiscal year 2020 and for an increasing income tax rate that impacted in 2021. Moving on to the balance sheet.
As you can see on Slide 11, we ended the quarter with a cash position of 5.3 billion pesos and those on debt of Mx$2.5 billion. Consequently, our net debt to EBITDA ratio stood at negative 0.12 times compared to 0.16 times at the end of 2020.
During the quarter, we continued reducing our debt in $16 million, standing at $24 million, most of which is nominated in U.S. dollars.
Additionally, we continue with our share repurchase programs. We acquire share for a total amount of Mx$0.7 billion in the quarter and Mx$2.4 billion for the whole year.
Our operation cash generations stood at Mx$5.2 billion, reflecting a lower profitability, partially compensated by a positive working capital effect. Regarding capital expenditures, we spent Mx$2.2 billion, 27% of which were dedicated to L'Amali expansion project, almost completing the capital requirements of expansion.
Now, for our final remarks, I would like to hand the call back to Sergio.
Sergio Faifman
Thank you, Marcos. Now, to finalize the presentation, I please ask you to turn to Slide 13.
During the second half of 2021, certain demand increase and face a most reaching record highs. Looking ahead, we expect growth to continue with the base following the trend of recent months.
Always subset the outcome of percentage geopolitical turbulence and local political and macroeconomic challenging scenario. In this context, we remind focus on delivering strong facade.
As I mentioned before, as of December, we start the satisfaction of inaugurating the second line of L'Amali plant from forming it in one of the biggest cement plant in the . The incorporation of the new line also implies an update of the plant from the technological point of view and strong increase in its productivity, supported by the sustainability policies that's comply with the stricted internationally standards in terms of environmental guide.
This is the most important strategic investments that Loma Negra has made in the last 20 years gone through in recent time. Additionally, we are gratified to relate to our first sustainability report that we allow us to share with our stakeholder all the hard work Dr.
Loma Negra has been doing in the environment, social and corporate governance area. We are convinced that these are the fundamental pillars on which the growth of the company must be sustained.
I would like to conclude by combining our satisfaction with the result achieving in 2021. And thank you all our people and stakeholder for the commitment to Loma's operational excellence.
Without whom these results would have been impossible to achieve. We're now ready to take your questions.
Operator, please open the call for question.
Operator
Thank you. We will now conduct a question and answer session.
. Our first question comes from Alberto Valdez with UBS, please go ahead.
Alberto Valdez
Hi. Congrats Sergio and Marcos, and Diego for the results in 2021.
My question is to look ahead a little bit. About energy costs, you have seen the fuel energy's spiking due to the dispute between Russia and Ukraine, and we know that managing CIM (ph) that you had a contract with the government for the supply of natural gas.
And my question is, looking ahead, two things, the first one is about the gas contract. If you see any potential change between you and the government?
And the second one, also about the FX, with the IMS agreements, year agreement. If you may see a depreciation of aging finance is going growing close to balling managing China, now in the foreseeable future?
Thank you.
Sergio Faifman
Thank you for your question.
Unidentified Analyst
start with the first question.
Sergio Faifman
Unidentified Analyst
Our contracts today of natural gas are with the companies and not with their national government.
Sergio Faifman
Unidentified Analyst
In general, these contracts are for one year.
Sergio Faifman
Unidentified Analyst
We have already have an increase in the cost of natural gas after the pandemic.
Sergio Faifman
Unidentified Analyst
Current prices are slightly above what you have seen on this quarter.
Sergio Faifman
Unidentified Analyst
Right now, we are negotiating several contracts which start from next October and they are -- in very similar terms or prices from what we're seeing today.
Sergio Faifman
Unidentified Analyst
In conclusion, we are not seeing an increase or an increase in what we are paying today in the energy side.
Sergio Faifman
Unidentified Analyst
In respect of the Peso and the effects.
Sergio Faifman
Unidentified Analyst
We expect the FX movement following what's happening with inflation for the year.
Sergio Faifman
Unidentified Analyst
We are not expecting a hike in Southern hike in the FX Pesos.
Alberto Valdez
Sergio Faifman
Operator
And this concludes our question-and-answer session. I would like to turn the conference back over to Diego Jalón for closing remarks.
Diego Jalón
Thank you for joining us today. We really appreciate your interest in our company.
We remind you that our new sustainability report is at your disposal in our website, and we look forward to meeting you again in our next call. In the meantime, we remain available for any questions that you may have.
Thank you, and have a good day.
Operator
The conference has now concluded. Thank you for attending today's presentation.
You may now disconnect.