After a quarter crowned with a 10-digit net profit, the CEO of Votorantim CimentosOsvaldo Ayres, keeps his eyes on the growth plan drawn up in January this year. The company, owner of the brands Votoran, Itaú, Sweats e Tocantins and one of the leaders in the Brazilian cement market, achieved its best operational performance for the period, reflecting a buoyant Brazilian market and stronger sales in Europe.
“We have a solid diversification structure. We have geographic diversity in Brazil and a prominent operation abroad with a strong currency”, says Ayres. After the acquisition of six assets abroad in recent years, Votorantim Cimentos’ operations outside Brazil are already responsible for 45% of the company’s global revenue, which protects the company the strong devaluation of the real against the dollar seen this year.
The combination of domestic and foreign markets guaranteed the Ermírio de Moraes family company a net profit of R$1 billion in the period from July to September, an increase of 24% compared to the same period last year. The operating result was at the bottom of the balance sheet, with adjusted EBITDA of R$2.2 billion, an increase of 11% in the same comparison, with a margin of 29%, an increase of 3 percentage points.
In Brazil, the company sold R$3.5 billion, which guaranteed an operating profit of R$835 million in the quarter. Although the price of cement fell during the period, strong demand made up for it, says the CEO. Demand for the product surprised the industry this year to the point that the National Cement Industry Union (SNIC) revised the sector’s growth expectation from 1.4% to 2.8% at the end of 2024 in relation to the previous year.
Investments on the rise
The growth in the main lines occurred despite a 22% increase in investments, reaching R$635 million. “Our solid execution allowed us to maintain an accelerated pace of investments, in line with the plan we announced this year”, recalled Ayres, citing the R$5 billion program that Votorantim Cimentos announced in January to expand factories and investments in logistics, decarbonization and new businesses.
On another front, the company has also reviewed its factory portfolio, with the sale of operations in Tunisia and in Morocco, carried out in the last quarter for undisclosed amounts – the operations are still awaiting approval from the authorities in these countries and have not been accounted for.
The divestment should help reduce the company’s already low leverage, which stands at 1.76 times net debt to EBITDA – a level considered healthy and within the company’s debt policy since it regained its investment grade in 2019.
IPO not radar?
The revenue mix in strong currency could be an attraction for Votorantim Cimentos to try to listing on the New York Stock Exchangeas reported by the agency Bloomberg last week. However, Ayres denies that the company is seeking an initial public offering (IPO) on the American stock exchange.
It is worth remembering that the company already has the necessary registrations for an IPO in Brazil and its name is constantly speculated as one of those that could end the three-year fast without new listings of Brazilian companies on the Stock Exchange.
