Cementos Pacasmayo's Q1 2025: Unpacking Contradictions in Infrastructure Volumes and Dividend Strategies

Infrastructure project volumes and expectations, dividend policy and capital allocation, dividend policy and capital expenditures, infrastructure project volumes and growth are the key contradictions discussed in Cementos Pacasmayo's latest 2025Q1 earnings call.



Revenue Growth and Market Demand:
- Cementos Pacasmayo reported a 4.8% year-over-year increase in revenues for Q1 2025.
- The growth was driven by stronger demand for bagged cement and concrete for infrastructure projects.

EBITDA Performance and Collective Bargaining Expenses:
- The company's consolidated EBITDA was PEN134.7 million, a 1.4% increase compared to the same period last year.
- Despite an increase in expenses related to collective bargaining negotiations, primarily a higher bonus for the first year, the EBITDA margin is expected to stabilize in the following quarters.

Concrete and Infrastructure Projects:
- Sales of concrete, pavement, and mortar increased by 22.3% year-over-year, driven by the execution of three major infrastructure projects.
- This growth is attributed to involvement in projects such as Motupe riverbank defenses, Yanacocha, and the Tarata bridge, which will secure stable demand moving forward.

Decarbonization and Clean Fuels:
- Cementos Pacasmayo is focused on reducing the use of coal, exploring cleaner alternatives like biomass.
- The company is conducting successful lab tests and scale trials using sugar cane byproducts as clean fuel sources, aiming to maintain affordability and reduce environmental impact.

Dividend Policy and Debt Management:
- The company plans to continue delivering a solid dividend policy and lowering debt levels in the coming years.
- With no major capital expenditures (CapEx) planned, the focus is on maintaining a strong balance sheet and returning capital to shareholders while managing leverage.