Cementos Pacasmayo S.A.A.

Good day, ladies and gentlemen. Welcome to Pacas Mayo's fourth quarter 2023 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, Sustainability and Investor Relations Manager. Mrs. Bustamante, you may begin.

Thank you, Tim. Good morning, everyone. Joining me on the call today is Mr. Humberto Nadal, our Chief Executive Officer, and Mr. Manuel Ferreiros, 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. Ferreiros 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 uncertainty 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 Naran.

Thank you, Claudia. Welcome, everyone, to our Quality Results Conference Call, and thank you so much for joining us today. This quarter, we continue to focus on our strategy, which led us to deliver outstanding results in terms of profitability. We reached a gross profit margin of 39.4%, almost nine percentage points higher than the same quarter of last year. This significant increase in margin was mainly due to the lower production cost of our new kiln in Pacasmayo, which also allowed us to replace imported clinker with our own clinker, as well as to the decrease in the cost of coal. Considering that we now have this additional capacity that is both efficient and more environmentally friendly, we decided to make an impairment of our vertical kilns. This non-cash effect affected EBITDA, but our adjusted EBITDA increased 29% year-over-year this quarter, and adjusted EBITDA margin reached 30.5%. These outstanding, and I want to stress, outstanding quarter results have allowed us to reach a record adjusted EBITDA of $518.3 million in 2023, the highest in all the history of Pacas Mayo. We firmly believe these are remarkable achievements, especially considering that in terms of demand, it was a very challenging year, as well as the social conflict and cyclone Yaku that affected our sales in the first half of the year. We are convinced that the efficiencies achieved will be sustained over time, making for a very promising 2024, as volume should continue the positive trend we started seeing in the second half of last year. In terms of our long-term strategy, I'd like to take this opportunity to look back on our digital strategy and how we have progressed over time. If we look at the digitalization of our commercial strategy, we have now migrated completely from a traditional model to a fully digital one. For the self-construction segment, we continue to enhance Mundo Experto, an ecosystem of digital solutions that targets the needs of foremen, self-builders, and individual consumers. We also have Costudio Experto, a digital platform for foremen that provides them with daily tools and training to help them improve professionally. For hardware stores, we have FedExperto, developed to help them grow their business, digitalize their orders, and get training on topics linked to their main needs. For our concrete clients, we have PackagePro, a platform that provides comprehensive solutions for each project, including online scheduling and real-time tracking of the orders. This year, we are focused on improving our service to the concrete segment, adapting concrete segment, adapting it to the unique needs of each client, creating new tools to establish different prices according to what each client requires. Finally, we know that digitalization is needed not only for commercialization, but also to enhance internal processes. This is how we are taking the steps needed to become a fully data-driven organization. We have created a data and analytics committee to prioritize and sponsor initiatives and create the first agile unit in Pacasmayo. We are also in the process of designing and making available a corporate data ecosystem and implementing solutions that generate value for our business. We are convinced that these tools and surely more to come in the future along IA would be key to the success of our business in the coming years. I would like now to briefly, but not least, but importantly, mention an important milestone for IU. Our solution aims at families that need help financially with construction needs. Through an intelligent purchasing method, people are able to define a building project and buy the materials that they need, little by little, on a monthly basis, at their own pace. until they have all of the materials needed to carry out their chosen project. In December, after consistently making these payments, one of our clients was able to build his new roof. We are very proud, extremely proud of his achievement, and we'll continue to promote IU so that more families can build a safe home. Finally, I would like to highlight our continued and renovated commitment and belief in our country. Despite the instability, an extremely complex political scenario, we have been immersed in since 2020, we decided to bet on the future growth of Peru, as we have been doing for over 65 years, and invested around $85 million to optimize our clinical capacity, and a further $3 million to restore our road in Piura to improve connectivity in the event of heavy rains. We firmly believe that our country holds great potential, and that by standing by in the good times and bad times, We will see it reach the potential in the near future. I will now turn the call over to Manuel to get into more detailed financial analysis. Thank you, Humberto.