Cementos Pacasmayo S.A.A. (NYSE:CPAC) Q1 2024 Earnings Conference Call April 30, 2024 10:30 AM ET

Company Participants

Claudia Bustamante - Sustainability & Investor Relations Manager
Humberto Nadal - Chief Executive Officer
Manuel Ferreyros - Chief Financial Officer

Conference Call Participants

Natalia Leo - JPMorgan
Marcelo Furlan - Itaú

Operator

Good morning, ladies and gentlemen. Welcome to Pacasmayo's First Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode and please note that this call is being recorded. At the conclusion of our prepared remarks, we will conduct a question-and-answer session. I would now like to introduce your host for today's call Mrs. Claudia Bustamante, Investor Relations Manager. Mrs. Bustamante, you may begin.

Claudia Bustamante

Thank you Tim. 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, focusing primarily on our strategic outlook for the short and medium-term. 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 are related 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

Humberto Nadal

Thank you, Claudia. Welcome everyone to today's conference call and thank you for joining us today. This quarter we delivered very solid results in terms of margins, EBITDA and profitability. Although, sales volumes continued to lag behind because of demand side challenges, we were able to achieve a consolidated EBITDA of PEN132.8 million, a 10% solid increase year-over-year, as well as a 13.8% increase in net income by focusing on operational efficiencies related to clinker production and our most efficient kilns.

Northern Peru was impacted by climatic effects such as higher temperatures and increased water temperatures, which in turn affected agriculture and fishing. For example, mangoes, one of the main crops in Northern Peru, experienced a drastic decrease in production during the 2023, 2024 agricultural campaign. This translates into decreased disposable income, which in turn affects self-construction.

Additionally, there is a general lack of safety in the country, specifically the northern part of Peru, mainly in the form of extortions that are affecting overall economic activity including, and I would say, especially self-construction. We hope that these demand side challenges can be reverted and we are confident that when they do we're in the best possible position to tackle the resultant increase in demand.