Cemetir Holding

Good afternoon. This is the Coral School Conference Operator. Welcome and thank you for joining the Chimentil First Quarter 2025 Results Conference Call. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on the telephone. At this time, I would like to turn the conference over to Mr. Marco Maria Bianconi, head of M&A and Investor Relations. Please go ahead, sir.

Thank you. Good afternoon and good morning. Welcome to Chairman Tiroldi's first quarter results conference call. I'm here with our chairman and chief executive, Francesco Caltagirone, who is happy to take your question at the end of my 10-page presentation. So without further ado, I'll go ahead and on page two highlight the key takeaways for these results. The first quarter 2025 results are in line with management expectations. Revenue was modestly up despite cement volumes decline, but revenues were up in a number of countries. despite the Egyptian currency and the Turkish currency devaluation against the euro. There was a significant improvement in EBITDA in the Nordic and Baltic region and in Malaysia offset by a reduction in all other regions and a 4.8 million euro negative exchange rate effect. Net financial income was down from 2024 because comparable figures included extraordinary income related to the over 53% Egyptian pound evaluation against the Euro in the first quarter of last year. Cement volumes were down 6.2% year-on-year, mainly due to a one-off Turkish government ban on exports to Israel, active from the second quarter of 2024. Dynamics volumes were up over 2%, and aggregates were broadly in line with last year. 2025 guidance is confirmed, despite a very uncertain commercial and geopolitical backdrop. Going through a more granular detail on page three about our results, revenue reached €368.1 million, and non-GAAP revenue was actually up 0.9% to €370.5 million. The high revenue was recorded in Nordic and Baltic, Turkey, and Malaysia. with FX headwinds in Turkey and Egypt. Ready Mix volumes were up 2.1%, driven by positive performance in Nordic and Baltic and Belgium, while declined in Turkey. Aggregate volumes broadly in line with previous year. CEMET volumes were down 6.2%, mainly due to the Turkish government ban. and a general decline in all main regions with exception of Malaysia, Egypt, and China. EBITDA reached 66.4 million euro. Non-GAAP EBITDA was up 0.5% year-on-year to 69.7 million euro. There was a higher EBITDA in Nordic and Baltic and Malaysia offset by a reduction in other regions and a negative headwind of 4.8 million euro. Non-GAAP EBITDA margin was broadly unchanged. EBIT reached 31.1 million euro, and non-GAAP EBIT reached 37.2 million euro, minus 5.9% year-on-year. Financial results was 2.5 million euro, down from the 24.6 million euro of last year, mainly due to lower FX income as previously commented. Profit before tax was €30.3 million, non-GAAP profit before tax €39.7 million. Net cash reached €143.2 million, an improvement of over €66 million year-on-year, including €43.5 million of dividends by the parent company, €4.3 million dividends to minorities, and extraordinary investments of €48 million. Going through the single and each region on page four, starting with the most important one, accounting for around 47% of our quarterly share of Group EBITDA. Nordic and Baltic. In Denmark, the largest contributor. Grid cement volumes were in line with last year, with a slight reduction in wet cement. The residential sector is still weak. Partly balanced by buoyant infrastructure activity. Exports increased by 3% due to higher deliveries to Norway and Iceland. ReadyMix volumes were up 3%, whereas aggregate volumes increased by 12% with demand remaining strong. Increasing demand for sustainable products. EBITDA improved by 20.2% year-on-year, mainly due to the positive contribution of cement, some savings in purchasing cost, fuel, and electricity consumption. In Norway, academic sales volumes were up 13% due to more favorable weather conditions and the startup of some major programs. There are signs of a slight market recovery, although marked by some price competitions. EBITDA improved due to higher volumes and savings on cost, and the Norwegian krona depreciated slightly by 2% versus the Euro. In Sweden, ready-mix sales volumes were up 7% thanks to the contribution of a major project, whereas aggregate volumes were down 14%. EBITDA was up from last year, and the Swedish krona was brought in line with the Euro average. Turning to page five, to Belgium and France, accounting for around 28% of group EBITDA in the first quarter. Belgium and France here, domestic cement volumes declined by around 8% due to weak demand. Exports declined more sharply due to the slowdown in construction activity in northern France. Readiness volumes, on the contrary, were up 8% with more marked growth in Belgium. thanks to the continuation on some major projects launched at the end of last year, and despite very harsh weather conditions in January. Aggregate volumes were in line with last year. EBITDA was down mainly due to cement, penalized by lower sales volumes and prices. Turning page number six, Turkey here accounting for 11% of group EBITDA, From April 2022, Turkey has considered high penetration, as you know. Domestic cement volumes were down 5%, mainly due to slowdown in the Aegean region, while in other regions, volumes continue to grow, also supported by post-earthquake reconstruction. Cement and clinker exports were down 54%, penalized by the said Turkish government ban on export to Israel. from the second quarter of 2024. Ready Mix volumes were down 3%, mainly because of weakness in the Aegean region, whereas aggregate volumes were up 8%. Revenues in Euro were increased by 5.7%, thanks to higher selling prices in all business segments, despite a 14% Turkish Lira devaluation versus the Euro. EBITDA was down by 14.3% year-on-year, following volume reduction and higher cost. Turning over to page seven, North America, accounting for 6% of our EBITDA. United States volumes were down 7%, with a more significant decline in the state of Texas, which suffered from snowfall and frost, especially in January and February. In the York region and in Florida, there was a moderate reduction due to bad weather, whereas in California, sales were up. EBITDA was down 19% because of lower volumes and higher costs. There was also a 3% U.S. dollar revaluation versus the Euro average in the period. Turning over to page 8, Asia Pacific, we have China and Malaysia. This region accounts for 4% of Group EBITDA in a quarter. In China, revenue was down 5% due to lower selling prices and stagnant demand, high inventory, and delayed effects from government stimulus measures. Volumes were in line with previous year, but EBITDA was impacted by lower sales prices. There was also a 1.9% renminbi evaluation versus the euro. In Malaysia, on the contrary, revenue was up 17% driven by higher export volumes, Total volumes were up 36%, mainly due to timing differences in clinkier shipments to Australia. Domestic volumes were down 11%, also due to some orders being brought forward to December 24. Export grew by 8%, supported by higher deliveries to the Philippines and Cambodia. EBITDA increased thanks to higher volumes and some cost savings, partially offset by lower average selling prices. resulting from sales mix. The Malaysian Revit revalued by 8.7% versus the Euro average in the period. Turning over to the last geography on page nine, Egypt accounting for 3% of Group EBITDA. Here revenue declined by 7.5% mainly due to the 38% depreciation of the Egyptian pound. despite the 27.7% increase in local currency revenue. Y7 volumes were up 3% thanks to exports, which more than offset the decline in domestic volumes. Export volumes were driven by higher shipment to the United States, Israel, Greece, while sales to Europe were down. EBITDA decreased by 27.6% due to different sales volume mix and a higher operating cost, only partially offset the by higher selling prices. To note, a 38% Egyptian pound evaluation versus the Euro average in the period. This brings me to the last slide, number 10, with a guidance, a 2025 guidance, which is confirmed with a revenue around 1.75 billion Euro, an EBITDA around 415 million Euro, a net cash position of around 410 million Euro, and a CAPEX of around 98 million euro. This guidance refers, as usual, to like-for-like ongoing operation, non-GAAP, and excluding any extraordinary items. This ends my short presentation. I would now like to leave the floor to a Q&A session for our chairman and chief executive. Thank you very much.

This is the call for conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touchtone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. The first question is from Emanuele Galazzi from Equita. Please go ahead, sir.