- Adjusted EBITDA was R$4.9 billion, 6% lower than the previous year.
- EBITDA margin was 19%, five percentage points lower than in 2021.
- Leverage, measured by the net debt/adjusted EBITDA ratio, was 1.55x, the same as 2021 and the best level in over ten years.
- Net profit in the year was R$1.1 billion.
- The company invested a total of R$2 billion (Capex) in 2022, 36% more than in 2021.
- Key initiatives in the year included the completion of an acquisition in Spain, the definition of stricter decarbonization targets, approved by the Science Based Target initiative (SBTi), the launch of the logtech Motz and the new corporate branding.
São Paulo, March 15, 2023 – Votorantim Cimentos, a building materials and sustainable solutions company, ended 2022 with R$25.8 billion in global net revenue, an increase of 16% compared to 2021, resulting from stable sales volume and favorable price dynamics in all regions where it operates, which mitigated cost pressures and the impact of the exchange rate in the year. Cement sales in the countries where the company has operations totaled to 36.8 million tonnes, 1% less than the previous year. The company posted R$1.1 billion in net profit in 2022, 30% less than the previous year, primarily due to the negative impact of increased costs on the operating results and higher depreciation related to assets acquired in recent years.
“We had another year of solid results, thanks to our discipline in the execution of our strategy and despite a global environment marked by high inflation, rising interest rates and the ongoing consequences of the war between Russia and Ukraine. Locally, household indebtedness and credit tightening affected investments in new construction and renovation projects, which impacted the domestic cement market. Despite that, we increased our investments focused on improving competitiveness, developed and launched new businesses, and expanded our operations in important markets, such as Spain. The company is stronger, more resilient and better prepared for opportunities and challenges,” said Osvaldo Ayres Filho, COO of Votorantim Cimentos.
Last year, adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was R$4.9 billion, down 6% compared to the previous year. The EBITDA margin was 19%, five percentage points lower than in 2021 due to the effects of global inflation on the company’s costs. Year-end leverage, measured by the net debt/Adjusted EBITDA ratio, was 1.55x, the best level in over ten years. At the end of 2022, Votorantim Cimentos had a positive cash balance of R$4.9 billion, a level of liquidity strong enough to meet the company’s financial obligations for the next four years.
“Our leverage remained at the same level as in 2021, reinforcing our financial discipline and making it possible for us to increase investments, pay dividends and make acquisitions despite significant cost increases during the year. The company also carried out several liability management transactions, improving its debt profile and keeping its financial metrics aligned with investment grade standards and in compliance with the company’s financial policy,” said Bianca Nasser, global financial director of Votorantim Cimentos.
Last year, the company’s investments in expansion, modernization and business support (Capex) totaled R$2 billion, 36% higher than in 2021. These investments included projects to improve competitiveness, advance the company’s decarbonization commitments and implement the new cement grinding and shipping operations in the city of Minas, Uruguay. In November, Votorantim Cimentos completed the acquisition of the Heidelberg Materials operations in southern Spain, including a modern integrated cement plant located in the city of Málaga, three aggregate mining operations and 11 concrete plants in the Andalusia region.
Another highlight in the year was the announcement of a new decarbonization target approved by the Science Based Target initiative (SBTi). The new global target of 475 kg of CO2 per tonne of cement is 8.7% lower than the one previously announced as part of the company’s 2030 Sustainability Commitments (520 kg of CO2 per tonne of cement) and reflects a reduction of 24.8% compared to the 2018 base year. Through this new public commitment, Votorantim Cimentos is aligning its emission reduction targets to the ambition of the Paris Agreement, which aims to limit the increase in the global average temperature to well below 2°C above pre-industrial levels and also pursue efforts to limit the rise in temperature to 1.5°C. In 2022, the company emitted 579 kg of CO2 per tonne of cement, 3% less than in 2021 (597 kg of CO2 per tonne of cement). Since 1990, the company has reduced its CO2 emissions by 24%. Votorantim Cimentos was the only company in the building materials sector in Latin America to be included in the Top-Rated Industry Ranking from Sustainalytics for its ESG performance.
Another initiative in line with the decarbonization strategy was the signature of a Term of Engagement between Votorantim Cimentos and InvestSP, an investment and competitiveness promotion agency, for studies related to the modernization project of the Salto de Pirapora plant, located approximately 120 km from the capital of São Paulo. InvestSP will support the company in aspects related to the project’s feasibility study and implementation, primarily related to the relationship with government bodies and representatives in the state of São Paulo. The project includes the modernization of the cement plant’s production line, in different phases, primarily aiming to increase the unit’s thermal substitution rate and reduce CO2 emissions, in line with Votorantim Cimentos’ long-term sustainability commitments.
Last year, Votorantim Cimentos launched Motz, a digital carrier that came to transform the logistical journey of truck drivers and shippers through a simpler and more agile model. Motz operates independently and combines the strength and reach of the company’s cargo network with the startup spirit of a leaner, more agile, innovative and high-tech logtech. In 2022, Votorantim Cimentos also introduced its new corporate branding: more contemporary and diverse, representing the diversity of its people, products and businesses, combining tradition, innovation and vision of the future. The new visual identity connects the company’s strategic objectives and sustainability commitments with the process of transformation and growth in different segments and activities. In line with the new corporate branding, Votorantim Cimentos also launched new layouts for its cement brands in the Brazilian market: Votoran, Cimento Itaú, Tocantins and Poty.
Performance by Region
In Brazil, Votorantim Cimentos’ 2022 net revenue was R$12.7 billion, 23% higher than in 2021. Positive price dynamics offset the slight drop in cement sales, mainly in the self-construction segment, which was impacted by the economic situation but also partially offset by the real estate and infrastructure sectors. Adjusted EBITDA was R$2.4 billion, slightly higher (2%) than in 2021. In addition to price dynamics, the growth of adjacent businesses contributed to this result and mitigated cost pressures throughout the year.
In North America, net revenue was R$7.4 billion last year, an increase of 4% over 2021, thanks to the positive demand in the U.S. and Canadian markets, combined with the additional sales brought by McInnis, an acquisition completed in April 2021. Adjusted EBITDA in the region was R$1.6 billion in 2022, down 15%, primarily due to the impact of inflation on costs (including fuel, raw materials and energy), in addition to the appreciation of the real throughout the year.
In Europe, Asia and Africa, net revenue increased 16% in 2022 compared to 2021, totaling R$3.4 billion. Adjusted EBITDA in the region was R$676 million, a 20% increase over the previous year. In 2022, sales in Spain and Tunisia increased both organically and as a result of additional volume brought by the Alconera plant, acquired in October 2021. Despite the effects of the depreciation of the Euro during the year, the better operating performance was a result of price management in all the countries of the region, which mitigated the cost inflation.
In Latin America, net revenue was R$812 million in 2022, down 17% compared to 2021. Adjusted EBITDA was R$138 million, down 42%. The region’s results were primarily impacted by market dynamics in Uruguay, where a new competitor entered the market, and in Bolivia, where protests and strikes in the region where the company operates affected prices and sales.