Votorantim Cimentos shares Q1 monetary benefits

“Our final results in the 1st three months of the calendar year mirror our resilience and teamwork to prevail over adversity in the experience of COVID-19. The pandemic even now brings a whole lot of volatility and uncertainty, and people’s life carry on to be a priority as we carry out our business enterprise. The initial quarter reflected the company’s unique positioning and probable for operational leverage, as we remained targeted on keeping our guard up,” reported Marcelo Castelli, Worldwide CEO of Votorantim Cimentos.

Votorantim Cimentos finished the first quarter with modified EBITDA (earnings prior to desire, taxes, depreciation and amortisation) of R$971 million, an enhance of 318% in contrast to 1Q2020, and an EBITDA margin of 24%, an boost of 16 percentage points over the similar interval in 2020. These effects mirror good product sales volume and the favourable influence of the appreciation of the greenback against the actual. Leverage, calculated by the web debt/modified EBITDA ratio, remained stable at 1.98x, in line with the company’s economic plan.

“We exercised our customary financial self-discipline and actively worked on debt management. As a final result, we ensured liquidity and a sturdy cash position and kept the company’s leverage below regulate for the duration of the quarter. With more robust working outcomes and far better credit metrics, we resumed the payment of dividends to shareholders and not only maintained our financial investment grade by two danger score organizations, but also experienced our outlook not too long ago upgraded to steady by Fitch Ranking,” claimed Osvaldo Ayres Filho, World-wide CFO of Votorantim Cimentos.

Effectiveness by region

In Brazil, Votorantim Cimentos’ internet income in the quarter was R$2.2 billion, an improve of 47% as opposed to 1Q2020. Modified EBITDA was R$594 million, an increase of 433% more than the exact same quarter past year. The positive outcomes in the initial quarter of 2021 are largely owing to an raise in revenue quantity and prices, as well as ongoing optimistic market place dynamics in all locations of the nation. The Brazilian cement industry ended the 1st quarter of 2021 with a complete of 15.3 million t traded, an increase of 19% about the past calendar year, according to the Countrywide Cement Affiliation (SNIC). The principal general performance drivers have been favourable temperature disorders, the reality that civil development continued to be considered an vital assistance and the steady advancement of the self-development and real estate sectors. SNIC estimates that the cement sector will mature in between 1% and 2% in 2021.

In North The usa, the company’s net profits was R$815 million in the very first quarter of 2021, an raise of 29% over 1Q2020, which is principally stated by bigger profits due to favourable temperature ailments, which recurrently have an effect on operations and results in the Northern Hemisphere, in addition to the favourable impression of the exchange price. Altered EBITDA was R$42 million in the initially quarter of 2021, when compared to negative R$5 million in 1Q2020.

In Europe, Africa and Asia, Votorantim Cimentos’ internet revenue was R$814 million, an raise of 72%. Altered EBITDA increased 162%, totalling R$249 million in the quarter. The beneficial effects are owing to a bigger need in all international locations in contrast to the same time period past year, when the region was impacted by COVID-19 constraints. Other contributing things incorporate good rate dynamics and the devaluation of the authentic, in addition to a positive result of a non-recurring product linked to the sale of land in Turkey.

In Latin The united states, the company’s web earnings in the very first quarter was R$170 million, an raise of 24% in contrast to 1Q2020, and the altered EBITDA was R$86 million, an improve of 185% over the to start with quarter of 2020. These outcomes replicate large gross sales quantity and optimistic cost dynamics, specifically in Uruguay, in addition to expense administration and the constructive effect of the trade price. Also, COVID-19 constraints impacted 1Q2020 effects in Bolivia.

1Q2021 highlights

In March, Votorantim Cimentos issued its 1st ESG (Environmental, Social and Governance) debentures in Brazil, with targets joined to sustainability indicators. These had been the to start with ESG debentures issued in the Brazilian current market by a organization in the design sector. The R$450 million facility has a 5-calendar year term (maturing in February 2026), and an fascination rate adjusted according to CDI + 1.45% for each calendar year. The proceeds ended up utilized to prepay debts maturing in 2023. The efficiency indicators (KPIs) that will be measured are CO2 emissions for each ton of cement and thermal substitution price, two sustainability parameters that are significant for the cement industry and aligned with the 2030 Sustainability Commitments built by the organization in November 2020. By attaining targets set each two many years, Votorantim Cimentos will benefit from improved debt prepayment terms.

In the 1st quarter, Votorantim Cimentos and its subsidiary VCNNE, by way of RB Capital Companhia de Securitização, issued a Certification of Actual Estate Receivables (CRI) in the total of R$400 million. This was the company’s second CRI issuance in the Brazilian funds marketplace. The certification has a 12-yr maturity term and an once-a-year cost of IPCA + 4.47%. The organization and its subsidiary also contracted a swap to trade the floating IPCA+ fee for the floating CDI+ level , resulting in an once-a-year price of CDI + 1.33%.

In April, Votorantim Cimentos and Caisse de dépôt et placement du Québec (CDPQ), a lengthy-expression institutional trader, introduced the conclusion of the transaction to incorporate their cement functions in North The usa. Just after the completion of closing ailments, such as acceptance by regulatory authorities in Brazil, Canada and the United States, St Marys Cement Inc. (Canada), a wholly-owned subsidiary of Votorantim Cimentos, will progress with the method to include McInnis Cement Inc. Votorantim Cimentos Internacional (VCI), an worldwide investment system and wholly-owned subsidiary of Votorantim Cimentos, will have an 83% stake in the new entity, and CDPQ will have a 17% stake. The blend of the St Marys Cement (Canada) and McInnis Cement organizations is expected to noticeably bolster the strategic situation of the North American operations by raising cement output capability and operational efficiencies, and increasing the distribution community in the region.

Also in April, Juntos Somos Mais received a R$100 million capital expense from its shareholders Votorantim Cimentos, Gerdau and Tigre. Established by Votorantim Cimentos in 2014, the corporation Juntos Somos Mais maintains the most significant loyalty programme in the developing supplies retail sector and the major marketplace in the sector, with additional than 25 development and services organizations and 500 000 customers, which includes retail outlet owners, gross sales pros and building workers. The company’s extensive-phrase system is to be a just one-stop store for design by supplying options for shops and conclude consumers working on slight dwelling repair service assignments. The financial investment reinforces the shareholders’ dedication to help impressive projects that final result in the enhancement and modernisation of the sector in the country.

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