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Edited Transcript of CPACASC1.LM earnings conference call or presentation 13-Feb-20 3:00pm GMT

Q4 2019 Cementos Pacasmayo SAA Earnings Call

Feb 21, 2020 (Thomson StreetEvents) -- Edited Transcript of Cementos Pacasmayo SAA earnings conference call or presentation Thursday, February 13, 2020 at 3:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Claudia Bustamante

Cementos Pacasmayo S.A.A. - Head of IR

* Humberto Reynaldo Nadal Del Carpio

Cementos Pacasmayo S.A.A. - CEO & Director

* Manuel Bartolome Ferreyros Peña

Cementos Pacasmayo S.A.A. - CFO and VP of Administration & Finance

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Conference Call Participants

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* Andres Soto

Santander Investment Securities Inc., Research Division - Head of Andean Research

* Babatunde Ojo

Harding Loevner LP - Portfolio Manager of Frontier Emerging Markets, Analyst of Frontier Emerging Markets & Partner

* Fernando Froylan Mendez Solther

JP Morgan Chase & Co, Research Division - Analyst

* Francisco Suarez

Scotiabank Global Banking and Markets, Research Division - Associate Director of LatAm Utilities

* Juan Pablo Brosset

CrediCorp Capital, Research Division - Fixed Income Analyst

* Lucia Calvo Perez

LarrainVial S.A., Research Division - Equity Analyst

* Luis Adolfo Pardo Figueroa

Compass Group Peru - Co-Portfolio Manager & Head of Research

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Presentation

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Operator [1]

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Good day, ladies and gentlemen, and welcome to Pacasmayo's Fourth Quarter 2019 Earnings Conference Call. (Operator Instructions) And please note that this call is being recorded. (Operator Instructions) And now I'm pleased to turn the floor over to our host for today's call, Investor Relations Manager, Ms. Claudia Bustamante. Welcome, Claudia.

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Claudia Bustamante, Cementos Pacasmayo S.A.A. - Head of IR [2]

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Thank you, Jim. Good morning, everyone. Joining me on the call today is Mr. Humberto Nadal, our Chief Executive Officer; and Mr. Manuel Ferreyros, our Chief Financial Officer. Mr. Nadal will begin our call with an overview of the quarter and our strategic outlook. Mr. Ferreyros will then follow with additional commentary on our financial results. We'll then turn the call over to your questions.

Please note that this call will include certain forward-looking statements. These statements relate to expectations, beliefs, projections, trends and other matters that are not historical facts and are, therefore, subject to risks and uncertainties that might affect future events or results. Descriptions of these risks are set forth in the company's regulatory filings.

With that, I'd now like to turn the call over to Mr. Humberto Nadal.

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [3]

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Thank you, Claudia. Welcome, everyone, to today's conference call. Today, I will discuss our overall results for this quarter, but especially for the year as a whole and how this will sustain the future of our operations. Manuel will then cover financial details, and we will then open the line to your questions.

During this fourth quarter, we continued seeing a very strong trend in sales volume, reaching almost 8% growth year-on-year. For the full year 2019, sales volume grew almost 11%, an outstanding level, which we have not seen in the past 7 years. This growth has come from public sector spending for the construction works, but also from the self-construction segment that posted strong growth this year.

Agriculture, particularly avocados and blueberries, which grow mainly in the north, have performed very well this year. This in turn resulted in increased self-construction and disposable income increase. Nonetheless, what's especially relevant here is a great increase in nonbagged cement since this reflects clearly our persistent effort to make a change in market dynamics and encourage the use of other building solutions.

In 2019, the increase in nonbagged cement products represented 42% of the overall increase in cement, concrete and block sales, reaching all-time record levels. This quarter, in particular, growth has come mainly from medium-sized local construction companies that are developing housing and commercial projects. And we have worked hard, very hard, to incorporate the ready-mix market. This is a segment we believe brings sustainability and continuity to the business, making it very important in the long term.

In terms of EBITDA, our consolidated EBITDA increased almost 11% this quarter compared to the same period last year and almost 8% for the full year 2019 compared to 2018. Although this technically represents a slight margin contraction, this is mainly due to temporary cost increases as well as more structural changes. We had higher transportation costs against this quarter -- again, this quarter, because the demand for type V cement increased and its production is centralized in the Pacasmayo plant for the whole region.

Although that will continue on for some months, we are working on resolving the issue as we have invested in a new silo for Piura, which is right now under construction. This will allow for savings on transportation costs once the silo is ready, which we expect should be during the third quarter of this year.

Also we plan to work our Piura kiln close to full capacity from 2020 onwards to produce inventory for future use. This will allow for cost savings due to operational efficiencies and also to postpone the needs for imported clinker investment on our future expansion. However, it is important to mention that on a more structural sense, EBITDA margin will tend to decrease in time as less bagged cement is sold and concrete and precast become a higher percentage overall sales. We have to bear in mind though that this is completely aligned with our strategy since the overall profit of our business increases when we sell more value-added products despite the margin contraction. It's all about dollars in the end.

Moving on to our strategy and future vision. During 2019, we launched a variety of initiatives aimed at getting closer -- getting us closer to our 2030 goals. We have started our process of cultural transformation in our organization as we believe this is key as it's the basis of future achievements.

One very important milestone in this direction is the definition for a new purpose of our organization, which will help us consolidate our identity, align our teams and strengthen the commitment to our stakeholders. This purpose was created with the active participation of over 1,300 employees, clients and users.

Under the concept, "Let's build together the future you dream of," we express our essence, the legacy we want to leave. This is our purpose from here on. We believe that a better future is possible, and we are aware that only together, as a team, we can generate great changes.

Another very important initiative is digitalization. This year, we provided innovation projects to create new products and the use of digital channels to improve the customer experience. We have developed a variety of different platforms for order tracking, notifications and business management. One example of this is the [Feramas] project. We selected a pilot group of hardware stores and provided them with tools for business management, including cash flow and daily inventory management as well as an order tracking system to get real-time dispatch information. This pilot project has proved to be very successful, and we plan to extend it to be a wider group during this year and beyond.

In conclusion, we are extremely pleased and proud of our 2019 results, both in terms of top line growth and profitability and in terms of long-term initiatives that will ensure our business future success, sustainable growth and long-term value generation.

I will now turn the discussion over to Manuel to go on into more detail on our financial performance. Manuel?

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Manuel Bartolome Ferreyros Peña, Cementos Pacasmayo S.A.A. - CFO and VP of Administration & Finance [4]

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Thank you, Humberto. Good morning, everyone. Fourth quarter 2019 revenues were PEN 374.7 million and 8 -- and 9.8% higher than the same period of last year mainly due to the increase in cement, concrete and precast volumes. Gross profit increased 0.2% in this fourth quarter of 2019 compared to the fourth quarter of 2018 mainly due to the higher sales, offset by higher transportation and raw material costs, which we will analyze in more details below.

For the full year, revenues increased 10.3% and gross profit increased 4.3%. Consolidated EBITDA reached PEN 100.9 million in the fourth quarter of 2019, a 10.9% higher than the same period of last year, mainly due to increased sales mentioned above.

During the 2019, consolidated EBITDA reached PEN 400.3 million, a 7.7% increase when compared to 2018.

Turning to operating expenses. Despite the increase in sales, we have managed to keep expenses at levels very similar to the previous year. Administrative expenses for the fourth quarter of 2019 and the full year 2019 remain in line with the fourth quarter of 2018 and the whole year of 2018. Selling expenses in the fourth quarter of 2019 and the full year 2019 were also flat when compared to the same period of last year despite the increase in sales mainly due to decreased advertising and promotion expenses after budget adjustments.

Moving on to our different segments. Cement, concrete and precast sales increased 10.1% during the fourth quarter of 2019 compared to a same quarter 2018 mainly due to the higher sales volume and average price for all segments.

Gross margin decreased 4.1 percentage points in the fourth quarter of 2019 compared to the same period of last year mainly due to higher transportation costs. Since there has been a significant increase in demand for type V cement for public works, and this is only produced in the Pacasmayo plant, we have had to transport clinker from Piura to Pacasmayo to produce this cement and then ship it back to Piura for the final sale.

We foresee this having an impact until the third quarter of this year, as Humberto mentioned. During 2019, sales of cement, concrete and precast increased 13.6%. And the gross margin decreased 3 percentage points when compared to 2018 for the above-mentioned reasons as well as the use of higher-priced clinker in the first half of 2019 during maintenance of the kiln in Pacasmayo and higher sales of concrete and precast, which have lower margins than cement, but represents a higher overall profit for the company.

Concrete sales continue to perform very well this quarter despite the combination of some large private projects achieving a 20.4% increase when compared for -- with the fourth quarter 2018, reflecting increased sales to infrastructure projects and small and medium-sized projects like Humberto mentioned. Gross margin decreased 5.5 percentage points reported this quarter compared to the same period of last year mainly due to a change in sales mix since some large infrastructure projects ended this quarter.

For the full year 2019, concrete sales increased 44.6%, and the gross margin increased 3.7 percentage points mainly due to higher sales, and consequently, higher dilution of fixed costs. Precast sales also increased 42.6% in the fourth quarter of 2019 compared to the fourth quarter of 2018 mainly due to higher demand from reconstruction-related projects. Gross margin also increased 32.2 percentage points as we continue to focus on higher-margin products and recovered from negative margins during the fourth quarter of 2018.

For the full year 2019, revenues increased 15.6%, and gross margin improved 16.9 percentage points as we prioritize sales of higher-margin products. Quicklime sales increased 18.2% this quarter when compared to the fourth quarter 2018 mainly due to a onetime increase in demand from one of our main clients. Gross margin also increased 14.9 percentage points in the quarter when compared to the same period of last year mainly due to a higher dilution of fixed costs and increased production.

During 2019, sales continue the downwards trend we've been experiencing from the most part of the year, with revenues decreasing 37.3% when compared to the same period of last year. Profit for the year was 20 -- sorry, profit for the period was PEN 29.5 million, a 356% increase when compared to the fourth quarter 2018 and PEN 132 million for the whole year 2019, representing a 75.8% increase when compared to the same period of 2018 mainly due to higher revenues, improvement in operational efficiencies and the one-off noncash expense incurred during the fourth quarter of 2018 for the provision of a tax receivable to the Peruvian tax authority and accounting effect of the purchase of the part of international bond.

To summarize, volume has been very strong this quarter, adding to the already outstanding performance we had seen in previous quarters. We are also -- we are very pleased with this growth, especially in the concrete segment as it is aligned with our 2030 vision of becoming a building solutions company and increase in the overall profit of the company as a result of this.

I'll now turn the call back to Humberto for closing remarks.

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [5]

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Thank you, Manuel. We are indeed pleased to see that not only has overall demand been very strong due to market conditions, but we have been able to capitalize on this positive environment to improve profitability and continue to pave the path towards the future and further value generation.

Can we now please open the call to questions?

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Questions and Answers

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Operator [1]

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(Operator Instructions) We'll hear first from Andres Soto at Santander.

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Andres Soto, Santander Investment Securities Inc., Research Division - Head of Andean Research [2]

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My first question is regarding your outlook for volumes in -- or total revenue in 2020 considering the ramp-up execution that we are seeing in the reconstruction project. And out of this, how much -- how will you break down that expectation in terms of this reconstruction versus the sort of organic growth that you are also seeing in the market?

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [3]

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Andres, thank you for your question. I mean we think this -- our base scenario this year should be around 5% to 6% revenue growth. That's our base scenario. Regarding how we'll be expecting the reconstruction and everything else. I think reconstruction will pick up a stronger pace. As you are aware, that the government has decided to go ahead with a different way of execution. They're going to repeat what they did for Pan American Games in which they are hiring prior PMOs to conduct still outstanding $13 billion -- PEN 13 billion in budget. So this will probably speed up the construction in this year compared to the other segments of our demand.

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Andres Soto, Santander Investment Securities Inc., Research Division - Head of Andean Research [4]

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And talking about prices, I saw some weakness on a sequential basis when I look at your cement prices. I would like to understand what is driving this price weakness. And what are you expecting in terms of price increases for 2020?

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [5]

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Yes. Thank you. The last quarter of last year, we had a recuperation in prices going into this year. I think this year, they should probably remain at the levels of -- at the time that we closed last year, maybe a little bit higher, but somewhere around there.

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Operator [6]

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Our next question will come from Luis Pardo with Compass Group.

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Luis Adolfo Pardo Figueroa, Compass Group Peru - Co-Portfolio Manager & Head of Research [7]

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Just a quick question on the margin. Good growth. And as growth continues, it should accelerate based on your comments on the reconstruction. We were expecting somewhat of a margin bump given the high utilization rate. However, this logistics issue is likely to hurt that. What should we expect for EBITDA margins next year -- or I mean 2020, sorry.

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [8]

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Yes. Thank you, Luis. Three effects that you have to consider in the margin. One is an effect. You mentioned of transporting clinker fly from one place to the other. That should be gone for the third quarter of this year. That should hit us a little bit on the positive side. And of course, as we use Piura at a full scale, that should also capture more EBITDA volume. On the other hand, the more concrete, the more ready-mix we sell, even though we're selling more cement, I will reckon the margin in the cement, when you talk about the specific margin in the consolidated P&L of the concrete that is lower, so that brings numerically the number of the margin lower, even though we are making more money. I mean, bearing all that, I mean, if you put it together, on average, we should be hitting close to a 30% EBITDA margin.

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Operator [9]

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Next, we'll hear from Francisco Suarez at Scotiabank.

(Operator Instructions)

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Francisco Suarez, Scotiabank Global Banking and Markets, Research Division - Associate Director of LatAm Utilities [10]

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Sorry for that. So a follow-up on the -- on your logistics cost for this year. So to understand properly, what is the thing that didn't allow you to produce the right set of clinker in Pacasmayo in order to avoid that logistical costs related with clinker transportation?

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [11]

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Francisco, the answer is very simple. Even though most plants can produce any type of clinker, we need specific silos to store the clinker. So we build Piura at that time the demand on the northern part of our region was very low for cement type V, so we didn't do a silo. We said, "Okay, the little demand will bring it from Pacasmayo." When the cement demand picked up, we have to ship far more than we had expected. That's why we're now building a silo in Piura. So we can -- we always hope to produce the cement. The thing is where we could store it. So starting third quarter this year, we should be storing -- producing and storing the cement type V in Piura.

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Francisco Suarez, Scotiabank Global Banking and Markets, Research Division - Associate Director of LatAm Utilities [12]

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Okay, perfect. Now that's very clear. And thank you for the answer because I was thinking there was something much more complicated than that. The second question that I have in mind is on margins on ready-mix. Generally speaking, yes, we saw a contraction, but still, those margins are okay. I mean, I think that it is worth -- I mean it is actually correct to expect that EBITDA margins for the ready-mix business should be stabilizing at levels of between 10% and 13%, perhaps.

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [13]

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Yes, that's correct.

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Francisco Suarez, Scotiabank Global Banking and Markets, Research Division - Associate Director of LatAm Utilities [14]

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Okay, fantastic. Thank you so much, and thank you as well for the guidance on the government-to-government programs that are being put in place this year.

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Operator [15]

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Next, we'll hear from the line of Froylan Mendez with JPMorgan. (Operator Instructions)

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Fernando Froylan Mendez Solther, JP Morgan Chase & Co, Research Division - Analyst [16]

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Congrats for the strong results. Could you let us know what percentage of the cement volumes in 2019 were the ones that were moved around from Pacasmayo to Piura, how much of the total volumes last year?

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [17]

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I don't have the exact number with me. But the number was not -- I mean, specifically high. I would have to guess probably around 25,000 to 35,000 tons.

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Fernando Froylan Mendez Solther, JP Morgan Chase & Co, Research Division - Analyst [18]

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Okay. And regarding the overall demand in 2019, how much was it related to reconstruction projects, et cetera?

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [19]

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In terms -- I mean -- the way to answer that question -- I mean you have to think about in terms of the increased demand. So I would say, I mean, overall, the reconstruction last year, that year of PEN 18.7 billion. Probably around 15% was spent last year. So in terms of volumes, around 170,000 -- we used around 170,000 tons of clinker to produce probably around 4 million or 5 million tons of cement.

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Operator [20]

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Next, we'll hear from Juan Pablo Brosset with CrediCorp Capital.

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Juan Pablo Brosset, CrediCorp Capital, Research Division - Fixed Income Analyst [21]

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I'm just trying to understand why the higher transportation costs will be gone by 3Q '19. So where does the increased demand for this type of cement comes from? And another follow-up question is what kind of infrastructure project does -- you should use this type of cement?

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [22]

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Sure. I mean this kind of cement is usually used in very heavy chlorine environment, basically ports. I mean something has going to -- has to receive the tack of sulfate. And in the case of the Talara Refinery, in the case of something around the -- on the Paita Port, those are the kind of projects that may require cement type V. I mean they perform much better when they're exposed to a highly salted environment.

And then to finish and the reason about understanding the difference is, I mean, it's a whole different thing moving cement from Piura to Paita to Talara. I mean we're talking, I mean, a few 100 and something kilometers than bringing it all over from Pacasmayo, which is around 600 kilometers to add on top of that.

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Juan Pablo Brosset, CrediCorp Capital, Research Division - Fixed Income Analyst [23]

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Okay. That was clear. And one quick additional question. I missed your volume guidance for 2020. Could you perhaps repeat it?

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [24]

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Sure. We said that the base scenario is between 5% to 6%.

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Operator [25]

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Next, we'll hear from Lucia Calvo Perez at LarrainVial.

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Lucia Calvo Perez, LarrainVial S.A., Research Division - Equity Analyst [26]

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I wanted to make a follow-up question on the type cement and higher transportation costs that you had this quarter. I just wanted you to comment as -- a little bit as last quarter, we had the same effect. But gross margin has still deteriorated quarter-over-quarter from 41% to 39.8%. So I was -- I just wanted you to comment as what were you expecting for the first and second quarter of this year if gross margin in cement is going to keep deteriorating. Or I don't know if you expect type V cement sales to represent a higher stake of cement sales in 2020 than in 2019?

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [27]

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No. I mean, once again, there's, I mean, 3 things that are moving the margin. The first one, and I've mentioned a couple of times already, is the moving of cement type V. That will be completely gone by the third quarter of this year. The second thing that will move the margin this year in a positive way is the fact that we're going to be using Piura 100%, which will give us economies of scale. We'll capture something there. The other thing that moves it south, but like I said, I mean, and I've discussed this extensively with many, many analysts and investors, is the fact that we're selling more building solutions, more ready-mix, the part -- the margin of the ready-mix itself, not the cement it uses, the ready-mix, they're value added. They create the margin there, I think Francisco mentioned it, it's much lower. So when you make the consolidated margin that is going to bring the margin lower, which is a good thing, because we're selling more concrete and we're selling more cement. And I think the way you asked to analyze that is, I mean, that's why our EBITDA this year went north of PEN 400 million, and last year, it was around PEN 370 million. That's the way you should look at it.

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Lucia Calvo Perez, LarrainVial S.A., Research Division - Equity Analyst [28]

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Okay. I understand. But looking only like at the cement gross margin and looking at it like quarter-over-quarter, you still have a deterioration. And I wanted to understand if you were expecting further deterioration or effect should remain as -- the transportation effect should remain as in this quarter.

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Manuel Bartolome Ferreyros Peña, Cementos Pacasmayo S.A.A. - CFO and VP of Administration & Finance [29]

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Yes. Only to complement the gross margin of cement, if we exclude the transportation issue, should have been in around 43 -- between 43% and 43.5%. This transportation effect should -- we should have it until at least the first 6 months of this year. The silo will be finished on the third quarter -- should be at the beginning of the third quarter. So this extra transportation costs, we should get rid of it for the second half of this year. So margins should go in the second half, again, to 43% something.

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Operator [30]

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Our next question will come from [Al Tito] with Pacifico.

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Unidentified Analyst, [31]

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Okay. I wanted to make a quick question about the -- your participation in next year's public investment recuperation. I don't know how much do you expect to participate in it. Or what are your margins on that front?

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [32]

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Well, I mean, I think, I mentioned before reconstruction works that are most slightly higher this year, I think, should pick up strongly, apace now that the government has decided to use a different business model to run those things. I think that's going to be important. And like I mentioned before, I think, besides big infrastructure projects, what we're seeing is pretty, I would say, amazing housing projects that will be done by the agriculture company that need housing for the workers that are right now spending 2 hours back and forth every morning. And they are going into projects of 400, 600 homes. And I think you want to see much more of that this year.

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Operator [33]

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(Operator Instructions) Next, we'll go to Luis Pardo with Compass once again.

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Luis Adolfo Pardo Figueroa, Compass Group Peru - Co-Portfolio Manager & Head of Research [34]

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Just a quick follow-up. I understand that you guys are accounting for EBITDA margin expansion from today's release, but 300 basis points is a lot. And the transportation issues should remain through the first half of the year, so which should really expect a boom in the second half. I just want to get more color on how we get to 30%.

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [35]

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Yes. But it's not really 300 basis points because we're going from 28.7% to 30%. So I think it's -- that's -- it will be reason of -- reasonably attainable once we have our silo work in Piura.

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Operator [36]

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And next, we'll hear from Tunde Ojo at Harding Loevner.

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Babatunde Ojo, Harding Loevner LP - Portfolio Manager of Frontier Emerging Markets, Analyst of Frontier Emerging Markets & Partner [37]

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My question is just on the CapEx guidance for 2020. If you can please keep that, that will be helpful.

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Manuel Bartolome Ferreyros Peña, Cementos Pacasmayo S.A.A. - CFO and VP of Administration & Finance [38]

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Yes. The estimate CapEx for 2020, Tunde, it's going to be around $30 million, maintaining CapEx and the new CapEx.

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Babatunde Ojo, Harding Loevner LP - Portfolio Manager of Frontier Emerging Markets, Analyst of Frontier Emerging Markets & Partner [39]

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$30 million, 3-0.

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Manuel Bartolome Ferreyros Peña, Cementos Pacasmayo S.A.A. - CFO and VP of Administration & Finance [40]

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Yes, 3-0, yes.

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Babatunde Ojo, Harding Loevner LP - Portfolio Manager of Frontier Emerging Markets, Analyst of Frontier Emerging Markets & Partner [41]

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Okay, okay. And it's just basically for maintenance, right?

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Manuel Bartolome Ferreyros Peña, Cementos Pacasmayo S.A.A. - CFO and VP of Administration & Finance [42]

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Yes, yes.

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Operator [43]

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Ladies and gentlemen, thank you all for joining today, and thank you all for your questions. At this time, we have no more signals in the group. I would like to turn it back to our -- oh, wait a second, just one moment, Humberto. We do have a follow-up coming from Juan Pablo Brosset at CrediCorp.

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Juan Pablo Brosset, CrediCorp Capital, Research Division - Fixed Income Analyst [44]

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Just one quick follow-up question. Regarding energy costs. This quarter, you have much more data on the cost of gas for the Piura plant. Have you witnessed any kind of savings on that front?

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [45]

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No. Like you said, we have a little more experience. We're still working on getting more efficient. We're basically maybe saving a little bit on what we used to spend on coal, but not substantially. We'll see what we -- what comes up in the coming months.

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Operator [46]

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Humberto, that was our final question from the audience. I would like to turn it back to yourself and the leadership team for any additional or closing remarks.

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Humberto Reynaldo Nadal Del Carpio, Cementos Pacasmayo S.A.A. - CEO & Director [47]

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Thank you very much. I want to thank everybody that joined the call today. We are very happy. We're very proud. But most of all, we are very excited about what's coming ahead of us in this year, which I think is going to be a very important one. And I'm very happy that our vision of pushing building solutions is really, really making the difference.

I mean we are growing at a much, much higher rate than the average cement growth rate in Peru, and I think that has to do with the strategy of the company. And we are all very proud, and I want to keep working hard for that. Thank you, everybody, and have a nice day.

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Operator [48]

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Ladies and gentlemen, this does conclude today's conference. We thank you all for your participation. You may now disconnect your lines, and we hope that you enjoy the rest of your day.