Grupo Cementos de Chihuahua (GCC) 4Q25

GCC posted positive results, better than our estimates and the consensus at the EBITDA level. Cement volumes during the quarter showed a positive recovery, increasing 6% on average. On the other hand, total EBITDA increased by a solid 17% YoY, implying an EBITDA margin expansion of 334 bps, reaching a 39.6% level (better than our 38.0% estimate, and higher than the 37.5% street expectation).

Revenues of US$360 million (+7% YoY) were driven by a 6% YoY growth in revenues in the U.S., and a 12% YoY gain in Mexico. In the U.S. (72% of total sales), cement volumes increased by 1%, while cement prices decreased 4% YoY. As a positive note, ready-mix volumes in the U.S. increased by 27% YoY (better than expected), while prices were up 9%. The renewable energy sector remained the most dynamic segment. In Mexico (28% of total sales), cement volume was up 11% YoY, while the local currency's cement price decreased 2% YoY. The better performance in volume was mainly explained by increased demand related to infrastructure projects and a normalized comparison base in the mining sector. On the other hand, excluding the peso appreciation against the U.S. dollar, Mexico's total sales would decrease by 4% YoY (having a positive impact of close to US$8 million).

During this quarter, the company's solid performance in ready mix in the U.S. and the gradual recovery in cement volumes in Mexico compensate for higher administrative expenses, implying an expansion in the EBITDA margin of 334 bps to 39.6% (a new high-record in GCC’s EBITDA margin) at around P$149 million, 6% higher than our US$134mn estimate, and 4% above the consensus projection. On an accumulative basis, in 2025, total EBITDA decreased 2% in-line with the company’s guidance.

The controlling net profit reached US$84 million, an 8% increase from the US$78 million reported in 4Q24. The company's cash position at the end of 4Q25 was US$970 million, with a negative net debt-to-EBITDA ratio of 0.71x.

GCC's 2026 EBITDA guidance assumes a mid-single-digit increase (our current estimate of US$527 million implies a 7% YoY increase). Cement volumes in Mexico and the U.S. may have a low single-digit increase and a high single-digit increase, respectively. On the other hand, GCC's CapEx guidance is driven to US$270mn (Lower than the US$400mn of 2025).

Following this better-than-expected quarterly result at the EBITDA level, we expect a positive stock reaction in tomorrow's trading session. We reiterate our Outperform Rating and our 12M PT of P$229.0 per share.