Cementos Molins earns 32 million euros in the first half of the year, demonstrating the resilience of its business model despite the impact of COVID-19

The company is committed to guaranteeing the health and safety of its employees and ensuring continuity of service to the customer.

30 July 2020_CementosMolins today announced its results for the first half of 2020, which were significantly affected by the impact of COVID-19.

Since the beginning of the spread of COVID-19, Cementos Molins has implemented plans in all its operations to guarantee the health and safety of employees and to ensure continuity of customer service. The crisis has had a significant impact on the operations of all its industrial facilities, which temporarily paralysed or reduced activity, to varying degrees depending on the country.

In order to mitigate the economic and financial impact, in March, Cementos Molins implemented a series of measures consisting of prioritising investments by sticking to the essential ones, a very significant reduction in operating and general costs, optimising working capital in line with the level of activity, and maintaining financial strength with a focus on generating liquidity and financing comfort.

COVID-19 had a limited effect on the results of the first quarter 2020, affecting only the second half of March, and a full impact on the results of the second quarter, with a strong impact in April and a gradual recovery in May and June.

Cementos Molins obtained revenues of 341 million euros, a decrease of 16% compared to the same period of the previous year. The contraction of the markets has led to a sharp drop in cement and concrete activity.

EBITDA was EUR 83 million, 16% lower than in the same period of the previous year, with a significant impact of exchange rates (the drop would be -1% at constant exchange rates). The positive impact of cost reductions and good price management partially offset the negative impact of the drop in volume due to the market situation.

Net profit amounted to EUR 32 million, 35% lower than in the first half of the previous year (-13% on a like-for-like basis). The improvement in the operating contribution of Mexico and South America was negatively impacted by the depreciation of their currencies and the negative impact of hyperinflation in Argentina.

As regards net financial debt, it decreased to €127 million as at 30 June 2020, representing a reduction of 30% compared to 31 December 2019 and 29% compared to 30 June 2019. The Net Financial Debt / EBITDA multiple continues to decrease to the level of 0.7.

Effects on the year
The business model of Cementos Molins has shown its resilience in the face of the crisis during the first half of the year. However, there is still a lack of visibility due to the spread of the coronavirus and its negative effects on the global markets. As a result of the above, Cementos Molins estimates that the markets will continue to contract at the end of the year, although a gradual recovery will be observed during the second half of 2020 and especially during 2021, which will vary greatly by country. In terms of results, Cementos Molins expects EBITDA and net profit for 2020 to be lower than in 2019 due to the significant impact of the crisis.

For Julio Rodríguez, CEO of Cementos Molins, the resilience of the business model in the face of the crisis and the high degree of commitment shown by employees in adverse circumstances have been key during the first half of 2020. “The global spread of the pandemic has been a major challenge over the last four months, which is being overcome thanks to our great team. I am confident that this strength, together with the resilience of our business model, will enable us to turn the current uncertainty into opportunities to emerge even stronger from this crisis.”

Following the European Securities Markets Authority (ESMA) guidelines on Alternative Performance Measures (APMs), which are mandatory for regulated information, the information and disclosures relating to APMs used in this press release are included in the “H1 2020 Results” presentation submitted by the Company to the Spanish Securities and Exchange Commission (CNMV).

About Cementos Molins. At Cementos Molins we have been creating products and developing innovative and sustainable solutions for the construction sector for more than 90 years. This is the way in which we contribute to the development of society and people’s quality of life. We currently operate in Spain, Argentina, Uruguay, Mexico, Bolivia, Colombia, Tunisia, Bangladesh and India. Our integrated model includes the businesses of aggregates, clinker, cement, concrete, mortars, prefabricated products and waste management. Our long history has been possible thanks to our team of almost 5,000 employees in nine countries and four continents who share the same DNA: we work every day with passion, respect and integrity, being non-conformist and efficient.