Welcome to the Loma Negra Second Quarter 2026 Conference Call and Webcast. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key, followed by zero. After today's presentation, there will be an opportunity to ask questions. Also, Mr. Sergio Feifman will be responding in Spanish immediately following an English translation. To ask a question, you may press star, then one on your telephone keypad. To withdraw your question, please press star, then two. Please note that this event is being recorded. I would now like to turn the conference over to Mr. Diego Jalon, Head of IR. Please, Diego, go ahead.

Thank you. Good day and welcome to Lomonegras Earnings Conference Call. By now, everyone should have access to our earnings press release and the presentation for today's call, both of which were distributed yesterday after market close. Joining me on the call today are Sergio Feisman, our CEO and Vice Chairman of the Board of Directors, and Marcos Gradin, our CFO. Sergio and Marcos will be available for the Q&A session. Before we proceed, I would like to make the following safe harbor statements. Today's call will contain forward-looking statements and I refer you to the forward-looking statement section of our earnings release and recent filing with the SEC. We assume no obligation to update or revise any forward-looking statements to reflect new or change events or circumstances. This conference call will also include discussion on non-GAAP financial measures, the full reconciliation to the corresponding financial measures is included in the earnings press release. Now, I would like to turn the call over to Sergio.

Thank you, Diego. Hello, everyone, and thank you for joining us today. I would like to start my presentation by discussing the highlights of the quarter. Then, Marcos will take you for our market review and financial results. Following that, I will share some final remarks before opening the call to your question. Starting with slide 2. As we move through the second quarter, industry volume have not yet fully guided the momentum we were expecting. Performance during the quarter was mainly affected by week April, impacted by heavy rains, while May and June trends were more in line with the level register eight years ago. Semen volume decreased 1.4% year-over-year, while consolidating net revenue increased to 1.0%, reaching Pesos 238.1 billion. In terms of quarterly performance, margin in Pesos showed some compression, mainly reflecting higher costs and depreciation, while our top line continues to show positive trends, even as volume remained lagging. Consolidated Adjustment EBITDA reached Pesos 48.2 billion, down 2.5% year-over-year, with margin contracting 97 basic points to 20.2%. In dollar terms, however, EVDA generation per ton stood at $32.1, up 14% year-over-year, underscoring the resilience of our operation even as demand recovery remains gradual. During the quarter, we can sell our Class IV corporate bonds for a total of $10 million, as we have no remaining structure debt maturity for the rest of the year. As of quarter end, NEP debt stood at $185 million, representing a NEP debt to LMT adjustment EBTA ratio of 1.3 times. I will now hand off the call to Marcos, who will you for our market review and financial results. Please Marcos, go ahead.

Thank you, Sergio. Good day, everyone. Please turn to slide 4. The most recent economic data shows a more moderate growth trajectory in the second quarter. The IMAE, Argentine's monthly economic activity indicator, grew 1.6% year-over-year in April, before slowing to 0.2% in May, with a monthly decline of 0.5% versus April. On a cumulative basis, the indicator is up 1.7% through the first five months of the year, although the pace of growth has clearly moderated compared to earlier in the year. Construction activity has shown a similar mixed trend. The ISAC declined 2.8% year-over-year in April, weighed down by the same heavy rains that affected our cement volumes before rebounding 4.1% year-over-year in May. Leading indicators remain constructive. Registered private sector's employments in construction grew 1.2% year-over-year in April and building permits authorized in the same month expanded by 17% year-over-year with a 7.6% decrease on a cumulative basis on the first fourth month of the year. Within the context, industry segment dispatches declined 5% year-over-year during the quarter, mainly reflected the impact of heavy rains in April across the country's main urban centers. Our own volumes follow a similar trend but a more moderate decline, down 1.4% year-over-year of performing the industry as May and June trends normalized closer to last year levels. In terms of product mix, bulk segment continues to perform, supported by larger scale projects, while bulk segment, which represents the majority of the industry mix, remains relatively weak, consistent with more cautious behavior in the retail and small contractor segment. Looking ahead, we expect a continued and even recovery path we have been describing, rather than a change in the underlying demand trend. That said, we remain cautiously optimistic going forward as we believe this recovery path remains intact. Turning to slide 5 for a review of our top-line performance by segment. Second quarter revenues increased by 2.1% year-over-year with growth led by the cement business followed by the redwood segment partially upset by lower revenues in the concrete and aggregate segments. In the cement, majorly cement and light segments, revenues increased by 2.2% year-over-year, while volumes decreased by 1.4%. Park cement dispatches continue to upperform, supported by higher activities from concrete producers, industrial clients and construction companies, while park cement remained under pressure, with the retail segment showing the weakest performance, as demand for self-construction and refurbishing projects remained delayed. Pricing dynamics remained positive, supporting the segment top-line performance. Complete revenues decreased by 11.2% year-over-year, as an 18.6% decline in volumes was only partially upset by favoring pricing dynamics. Volumes were mainly affected by lower demand from special projects, particularly those linked to port infrastructure and wind farms, which are now in their final stages of completion. The start of new projects have been gradually pushed back, though we expect them to break ground in the near terms. Volumes in Rosario remained more stable, supported by a combination of public and private works. Aggregates revenues decreased by 10.3% year-over-year, as a 12.2% decline in volumes was only partially upset by favored pricing dynamics. Volumes were mainly affected by the same dynamics impacted in concrete segments, particularly weaker demand from public works and construction companies. Railroad revenues increased by 8.6% over a year, as higher transported volumes, up 10.1%, were partially upset by softer pricing conditions. Volume growth was mainly driven by higher transportation of grain, cements and frac sand, the later reflection reflecting the resumption of operations to Nuken following the repair of the rail section in Vallablanca that had been affected by last year's storm. Moving on to slide 7. Consolidated cross-profit decreased by 3.9% euro per year, with gross margin contracting 122 basis points to 19.2%, mainly reflecting higher cost and depreciations. Cost of sales increased by 3.7% over a year, reflecting higher cost in the cement and railroad segments, partially upset by lower costs in the concrete and aggregate businesses. In the cement segment, cost of sales increased on a per-town basis, mainly driven by higher depreciation following the capitalization of the 25 kg bagging project after June of last year, along with higher packaging costs associated with its implementation, maintenance and freight costs also rose, later reflecting the pass-through of higher fuel prices, while thermal and electric energy costs remain broadly in line. As planned, most kilos were shut down in May to avoid operating during the winter months, helping to limit our exposure to higher energy costs. In railroads, the increase in cost of sales was mainly related to higher reported volumes together with higher salaries, fuel prices and depreciation. The concrete and aggregate segments both contributed positively to the consolidated result, posting gross margin expansion, although they remained in negative territory. Finally, SG&A expenses increased by 15.7% year-over-year, mainly driven by higher salary expenses. As a percentage of sale, SG&A stood at 12.1%, up 132 basis points, compared to the second quarter of 2025. Please turn to slide 8. Consolidated adjusted EBITDA for the quarter stood at US$38 million, while in pesos it reached US$48.2 billion, reflecting a 2.5% year-over-year decline. This decrease was mainly driven by a weaker result in the broilwood segment, together with, to a lesser extent, a contraction in cement, partially offset by improved results in concrete and aggregate. As a result, the consolidated beta margin contracted to 20.2%, representing an 87 basis point decrease year-over-year. In the seventh segment, adjusted the beta margin stood at 23.9%, down 81 basis points year-over-year, a smaller decline in the consolidated construction. As high the cost of sales and as GNA, as discussed in the previous slide, were partially cushioned by favorable pricing dynamics the concrete segments adjusted the bta margin expanded by 867 basis points to minus 4.3 percent from minus 14 percent in the second quarter of 2025 supported by favorable pricing dynamics and lower cost although it remained in negative territory Similarly, the aggregate segment improved its margin by 877 basis points, reaching minus 18.6% in the quarter from minus 27% in the same period last year, also supported by increasing price and cost control, although it likewise remains in negative territory. Finally, in the regular segment, the adjusted BTA margin turned negative, reaching minus 5.2% in the second quarter, compared to a positive 9.8% in the same period of 2025. This was mainly due to a higher cost of sales, primarily driven by increased fuel and labor costs, while its G&A expenses remained broadly in line. Moving on to the bottom line on slide 10, net profit attributable to owners of the company totaled 7.5 billion pesos for the quarter, compared to a 0.5 billion pesos in the second quarter of last year. The improvement was mainly driven by lower financial expenses, despite softer operating performance, and was partially offset by higher income tax expenses. On the financial side, the company reported a total net financial loss of 5.6 billion pesos for the quarter, compared to a net financial loss of 22.3 billion pesos in the same period of last year. The year-over-year improvement was mainly attributable to a lower foreign exchange loss on our U.S. dollar-denominated liabilities. as the peso continued to depreciate during the quarter, though at a more moderate pace than in the second quarter of last year. Additionally, net financial expenses decreased by 27% to 9.5 billion pesos, mainly driven by improved financial income, coupled with lower financial expenses. Moving on to the balance sheet, as you can see on slide 11, we ended the quarter with net debt of 274 billion pesos and a net debt to adjust the WTA ratio of 1.3 times, down from 1.47 times at the end of 2025. Cash flow from operating activities totaled 18.1 billion pesos in the quarter, compared to a cash outflow of 29.7 billion in the second quarter of 2025. This year, over-year improvement was mainly driven by a significant improvement in working capital, primarily reflecting lower income tax payments during the quarter, together with a strong increase in tax liabilities. This was partially upset by higher working capital requirements in trade receivables as well as account payables. Regarding investing activities, the company used 9.9 billion pesos with capex totaling 9.7 billions remaining lower following the completion of the 25 kilogram bagging project. On the financing side the company used 13.2 billion pesos during the quarter mainly related to the repayments of borrowings. In May 2026 the company completed the cancellation of the class 4 corporate bond for 10 million dollars leaving no remaining structure debt motivatives for the rest of the year in u.s dollar terms net debt stood at 185 million dollars with an average duration of 1.4 years as of quarter end 87 percent of total debt was denominated in dollars with the remaining balance in pesos now for our final remarks, I will hand the call back to Sergio.

Thank you. Thank you, Marcos. Now, to finalize the presentation, I please ask you to turn to slide 13. Spoiling during the third half of the year comes in below our initial expectation. Going forward, we may continue to see some volatility, including potential short-term decline, as the recovery patch is unlikely to be a striding line. At that time, we remain cautiously optimistic that the underlying trend for the second half of the year and beyond is a positive one. We are beginning to see some of the project approved under the Rishi regime starting to move forward. Beyond that, we see additional factors that could future support volume in the second half of the year, a potential easing of monetary condition and expected improvement in regular ways and a possible recovery in credit availability. Our top line continues to perform well during the quarter, and we remain focused on cost discipline and operational efficiency as we navigate a great demand recovery. Finally, on August 5th, LOMA celebrates its 100th anniversary, an important milestone that fills us with pride. We look forward to continuing to support the country's development over the next 100 years, just as we have through this past century. This is the end of our prepared remarks. We are now ready to take questions. Operator, please open the call for question.

Thank you. We will now conduct a question and answer session. If you would like to ask a question, please press star, then 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star, then 2 if you would like to remove your line. For participants using speaker equipment, it may be necessary to pick up your handset prior to pressing the keys. Once again, star 1 on your telephone keypad. We also would like to ask that you please limit your questions to one question and one follow-up please. If you have additional questions, you may re-queue for those questions and they will be addressed. Also, please note that Mr. Sergio Feifman will be responding in Spanish immediately following an English translation. Please hold momentarily while we assemble our roster. The first question is from Sofia Barta with Latin Securities. Please go ahead.

Hi, Loma team. Thank you for taking my question. It's regarding the second semester. If credit access remains limited, would the other demand Yeah, thank you for your question.

Sí, claramente creemos que el crédito es difícil que se recupere de forma significativa durante el segundo semestre.

Yes, actually we believe that it's difficult to see a significant credit improvement in the second half of the year. Asimismo, sí creemos que hay varios factores que deberían empezar a impactar positivamente en nuestro volumen y nivel de actividad. and we do believe there are other factors that should start to impact positively our level of activity.

Tenemos varios de los proyectos que han sido presentados dentro de RIGI que estamos avanzando en su cotización para comenzar. Algunos de ellos van a comenzar en el segundo semestre de este año.

Several of the projects presented.

Adicionalmente, tenemos todos los contratos de concesiones viales que el gobierno ha aprobado en el último tiempo. Additionally, those are already back in our body.

Thank you.

The next question is from Alejandra Obregon with Morgan Stanley. Please go ahead.

Hi, good morning. Thank you for taking my question. Mine is on your costs, on your unit costs, actually. So you mentioned in the release and across your remarks that these are up and you're starting to see some pressures on margins. And I was hoping to understand if you can help us break those trends down. So in terms of the cost headwinds, which ones do you think are a one-off or perhaps just seasonally related vis-a-vis those that are recurring? And if you think of perhaps the second half in 2027, what do you think are the levers that could help margins recover from these levels?

Hi, Alejandra. Thank you for your question.

Just to be clear and separate the unitary costs that are impacting the Q&A, I will remark some of those that are permanent, some of those will remain and some of those are new. During the water, we saw some increasing freight gas due to the impact of gas.

Additionally, when one compares to the last year, we have everything that has to do with the 25 kilos that was started to commercialize from June of the last year. Additionally, we also had the impact in starting to dispatch on July last year.

Here we have two times of...

Next question is from Daniel Rojas with Bank of America. Please go ahead.

Good morning. Thank you for taking my question. I wanted to go back to the 25 kilo bag project. Could you give us details on the implementation, on how it has impacted the commercial strategy and, of course, your pricing? You did mention it has been positive and you've been able to push for higher pricing. But just a little bit more color on how it was implemented. Has it been fully implemented? Did it surpass your expectations? Just anything you can give us.

Thank you for the question. Efectivamente, hay que recordar que el cambio de bolsa de 50 para 25 fue un requerimiento legal.

First of all, I would like to remark that this change of moving from 50 kilo bags to 25 kilo bags was to...

It's asociado a un tema de salubridad, del peso que las personas mueven cuando levantan la bolsa de 50 kilos. and this is related to improve the conditions of the workers' heavy bags. Si bien había normas que decían que para mudar las bolsas había que hacerlo con ayuda mecánica, como eso no se realizaba, se cambió la norma para que las bolsas pasen a 25 kilos. Firstly, the regulation was a... ...de dos bolsas de 25 kilos es superior al costo de una de 50 por los costos de envase, de inversión y de operación. about the cost with which, if you don't change, the norm prevailed that from a certain date all the Argentine market would have to go to 25 kilos and stop selling to 50.

So the regulation demanded that.

And the truth is that both the investment and all the operational part to be able to do it was a success, a investment of more than 60 million dollars. We have completed the prevailing period. Thank you very much.

And this concludes our question and answer session. I would like to turn the conference back over to Diego Jallon for any closing remarks.

Thank you all for joining us today, and we hope to meet you again in our next quarterly call. Thank you very much, and have a nice day.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.