CEMENTOS ARGOS S.A.

Argos sowed the seeds for greater competitiveness

In 2017, Cementos Argos, a subsidiary of Grupo Argos, made significant progress in the implementation of its Building Efficiency and Sustainability for Tomorrow (BEST) program. Advancing towards its goal of operational transformation, it reconfigured its product portfolio and its segmentation model to be closer to customers, saw savings of over COP $142 billion in Colombia, and successfully executed the first stage of an ambitious disinvestment plan in its three regions, which will enable greater competitiveness and better return on capital employed.

Another important advance is the sale of three self-generating energy assets (totaling 32 MW) in Colombia. The assets included in the sale were the Nare and Cairo plants in Antioquia, and the Sogamoso plant in Boyaca, which were offered to the Luz y Fuerza Colombia Group SAS for almost US$ 57.6 million.

Operating results for 2017, in a consolidated manner, totaled 16.2 million t of cement shipped, an increase of 15.8 %, and the volume of concrete closed at 10.6 million m3. Likewise, revenues reached COP $8.5 trillion, 0.2 % higher than in 2016. These results were driven mainly by the United States and the Caribbean and Central America regions, which, due to our diversification strategy, managed to counteract the loss in revenues of the Colombia Region. On the other hand, the adjusted EBITDA closed at COP $1.5 trillion.

Key facts by region:

In the United States, Argos positioned itself as the fourth largest cement producer. It is one of the markets with the best prospects worldwide, and the region became the largest generator of revenues and EBITDA. During 2017, the company also participated in emblematic projects such as Interstate 4 in Florida and the Mercedes Benz Stadium in Atlanta, Georgia, which will be the site for Super Bowl LIII in 2019.

In Colombia, the commercial strategy tightened the region’s focus on the customer, and its value proposition in all market segments was reviewed. In addition, the region launched the largest number of products from its innovation platform. Likewise, the region continues to lead in the industrial sector, due to the gradual increase of deliveries for Colombia’s 4G projects, which amounted to 85000 t, as well as participating in the Honda – Puerto Salgar – Girardot, Cartagena – Barranquilla and the three Pacific projects.

In the Caribbean and Central America Region, Argos successfully integrated a cement plant in Puerto Rico, which was acquired at the beginning of 2017. During the period, Argos participated as a cement supplier for notable projects such as the second line of the Panama Metro and the Ariane 6 space station in French Guiana. It also took part in the launch of cement packed in soluble sacks in San Vicente and Santa Lucia. This innovation allows the organization to continue positioning its brand and demonstrating that the future can be built through sustainable and innovative solutions.

www.argos.co

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