Annual report
Page 1
Table of Contents UNITED STATESSECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549______________________________ FORM 20-F ______________________________ o REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGEACT OF 1934 OR x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED December 31, 2024 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR o SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF1934 Date of event requiring this shell company report ________________ For the transition period from______________________________ to ______________________________ Commission file number: 001-38262______________________________ LOMA NEGRA COMPAÑÍA INDUSTRIALARGENTINA SOCIEDAD ANÓNIMA (Exact name of Registrant as specified in its charter)______________________________ LOMA NEGRA CORPORATION Republic of Argentina (Translation of Registrant’s name into English) (Jurisdiction of Incorporation or organization) Cecilia Grierson 355, 4th FloorZip Code C1107CPG – Ciudad Autónoma de Buenos AiresRepublic of Argentina(Address of principal executive offices) Marcos Isabelino GradinCecilia Grierson 355 4th FloorZip Code C1107CPG – Ciudad Autónoma de Buenos AiresRepublic of ArgentinaTel: 54-11-4319-3048Email: mgradin@lomanegra.com(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person) Securities registered or to be registered pursuant to section 12(b) of the Act: Title of each class Trading Symbol(s) Name of each exchange on which registered American Depositary Shares, each representing 5Ordinary Shares of Loma Negra C.I.A.S.A. LOMA New York Stock Exchange Ordinary Shares of Loma Negra C.I.A.S.A. LOMA New York Stock Exchange* * Not for trading, but only in connection with the registration of American Depositary Shares pursuant to the requirements of the New York Stock Exchange. Securities registered or to be registered pursuant to Section 12(g) of the Act: None Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None
Page 2
The total number of issued and outstanding shares of each class of stock of Loma Negra Compañía Industrial Argentina S.A. as of December 31, 2024was: 583,483,151 ordinary shares, nominal value Ps. 0.10 per share______________________________ Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No x If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of theSecurities Exchange Act of 1934. Yes o No x Note – Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934from their obligations under those Sections. Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filingrequirements for the past 90 days.Yes x No o Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit suchfiles).Yes x No o Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. Seedefinition of “large accelerated filer”, “accelerated filer”, and “emerging growth company” in Rule 12b-2 of the Exchange Act: Large accelerated filer o Accelerated filer x Non-accelerated filer o Emerging growth company o If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has electednot to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of theExchange Act. o †The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its AccountingStandards Codification after April 5, 2012. Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal controlover financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued itsaudit report. x If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in thefiling reflect the correction of an error to previously issued financial statements. ☐Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation receivedby any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b). o Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing: U.S. GAAP o International Financial Reporting Standards as issued by the InternationalAccounting Standards Board x Other o If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected tofollow. Item 17 o Item 18 o If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x (APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS) Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the SecuritiesExchange Act of 1934 subsequent to distribution of securities under a plan confirmed by a court. Yes o No o
Page 3
Table of Contents TABLE OF CONTENTS PART I 1 ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS 1 A. Directors and Senior Management 1 B. Advisers 1 C. Auditors 1 ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 1 A. Offer Statistics 1 B. Method and Expected Timetable 1 ITEM 3. KEY INFORMATION 1 A. [Reserved] 1 B. Capitalization and Indebtedness 1 C. Reasons for the Offer and Use of Proceeds 1 D. Risk Factors 1 ITEM 4. INFORMATION ON THE COMPANY 32 A. History and Development of the Company 32 B. Business Overview 33 C. Organizational Structure 59 D. Property, Plants and Equipment 59 ITEM 4A. UNRESOLVED STAFF COMMENTS 64 ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS 64 A. Operating Results 64 B. Liquidity and Capital Resources 93 C. Research and Development, Patents and Licenses, etc. 98 D. Trend Information 98 E. Critical Accounting Estimates 99 ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES 99 A. Directors and Senior Management 99 B. Compensation 103 C. Board Practices 106 D. Employees 110 E. Share Ownership 110 F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation 110 ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS 110 A. Major Shareholders 110 B. Related Party Transactions 112 C. Interests of Experts and Counsel 113 ITEM 8. FINANCIAL INFORMATION 113 A. Consolidated Statements and Other Financial Information 113 B. Significant Changes 119 ITEM 9. THE OFFER AND LISTING 119 A. Offer and Listing Details 119 B. Plan of Distribution 119 C. Markets 119 D. Selling Shareholders 119 E. Dilution 119 F. Expenses of the Issue 119 ITEM 10. ADDITIONAL INFORMATION 120 A. Share Capital 120 B. Memorandum and Articles of Association 120 C. Material Contracts 122 D. Exchange Controls 122 i
Page 4
Table of Contents E. Taxation 124 F. Dividends and Paying Agents 131 G. Statement by Experts 131 H. Documents on Display 131 I. Subsidiary Information 132 J. Annual Report to Security Holders 132 ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 132 ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES 133 A. Debt Securities 133 B. Warrants and Rights 133 C. Other Securities 133 D. American Depositary Shares 133 PART II 134 ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES 134 ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS 134 A. Material Modifications to the Rights of Security Holders 134 B. Material Modifications to the Rights of any Class of Registered Securities 134 C. Withdrawal or Substitution of a Material Amount of the Assets Securing any Class of Registered Securities 134 D. Changes in the Trustee or Paying Agents for any Registered Securities 134 E. Use of Proceeds 134 ITEM 15. CONTROLS AND PROCEDURES 134 ITEM 16. [RESERVED] 135 ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT 136 ITEM 16B. CODE OF ETHICS 136 ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES 136 ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES 137 ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS 137 ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT 137 ITEM 16G. CORPORATE GOVERNANCE 137 ITEM 16H. MINE SAFETY DISCLOSURE 139 ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 139 ITEM 16J. INSIDER TRADING POLICIES 139 ITEM 16K. CYBERSECURITY 139 PART III 140 ITEM 17. FINANCIAL STATEMENTS 140 ITEM 18. FINANCIAL STATEMENTS 140 ITEM 19. EXHIBITS 140 ii
Page 5
Table of Contents PRESENTATION OF FINANCIAL AND OTHER INFORMATION Certain Defined Terms In this annual report, unless otherwise indicated or the context otherwise requires: • all references to “Loma Negra”, “our company”, "the Group", “we”, “our”, “ours”, and “us”, or similar terms are to the registrant, Loma NegraCompañía Industrial Argentina Sociedad Anónima, a corporation organized as a Compañía Industrial Argentina Sociedad Anónima under the lawsof Argentina, and its consolidated subsidiaries; • all references to “our controlling shareholder” or to the “InterCement Group” are to InterCement Participações S.A. and its subsidiaries; • all references to the “InterCement Brasil” are to InterCement Brasil S.A.; • all references to “Yguazú Cementos” are to Yguazú Cementos S.A.; • all references to “Cofesur” are to Cofesur S.A.U.; • all references to “Ferrosur” or “Ferrosur Roca” are to Ferrosur Roca S.A.; • all references to “Recycomb” are to Recycomb S.A.U.; • all references to “Argentina” are to the Republic of Argentina; • all references to the “Argentine government” or the “government” are to the federal government of Argentina; • all references to the “BCRA” or “Argentine Central Bank” are to the Argentine Central Bank (Banco Central de la República Argentina);• all references to the “FACPCE” are to the Argentine Federation of Professional Councils of Economic Sciences (Federación Argentina deConsejos Profesionales de Ciencias Económicas); • all references to “CNV” refers to the Argentine securities regulator (Comisión Nacional de Valores); • all references to “U.S. dollars”, “dollars” or “US$” are to U.S. dollars; • all references to the “peso”, “pesos” or “Ps.” are to the Argentine peso,the official currency of Argentina; • all references to “IFRS” or to "IFRS Accounting Standards" are to the accounting standards issued by the International Accounting StandardsBoard, or the IASB; • all references to the “ITL” are to the Income Tax Law effective in Argentina; • all references to “AFCP” are to the Argentine National Association of Portland Cement Producers (Asociación de Fabricantes de CementosPortland); • all references to “BYMA” are to the Argentine Stock Exchange (Bolsas y Mercado Argentinos S.A.); and • all references to “NYSE” are to the New York Stock Exchange. All references in this annual report to “tons” shall also include “metric tons” References to “dmt” are to dry metric ton. References to “kt” shall mean“kiloton”, equivalent to 1,000 tons. The term “MW” and “GW” refers to megawatt and gigawatt, respectively, and the term “GWh” refers to gigawatt hours.The term “m3” refers to cubic meter, and “kcal/kg” to kilocalories per kilogram. The term “FOB” refers to the Incoterm “Free on board”. Financial Statements We maintain our books and records in constant pesos, the presentation currency for our consolidated financial statements and also the functionalcurrency of our operations in Argentina. We have prepared our annual audited consolidated financial statements included in this annual report in accordancewith IFRS Accounting Standards, as issued by the IASB. Unless otherwise noted, our financial information presented herein as of December 31, 2024 and2023, and for the years ended December 31, 2024, 2023 and 2022 is stated in pesos, our reporting currency. This annual report includes our audited consolidated financial statements as of December 31, 2024 and 2023 and for each of the years ended December31, 2024, 2023 and 2022, together with the notes thereto, or “our audited consolidated financial statements”. All references herein to “our financial statements”,“our audited consolidated financial information”, and “our audited consolidated financial statements”, are to or derived from our consolidated financialstatements included iii
Page 6
Table of Contents elsewhere in this annual report. These references do not pertain to the non-financial information included in this annual report, which is derived from ourinternal information systems and is not covered by the report of an independent registered public accounting firm. Our audited consolidated financial statements as of December 31, 2024 and 2023 and for each of the years ended December 31, 2024, 2023 and 2022,comprehensively recognize the effects of variations in the purchasing power of currency through the application of the method to restate financial statements inconstant currency established by the International Accounting Standard 29, or IAS 29, as Argentina is considered a hyperinflationary economy starting July 1,2018. Financial information presented in constant currency IAS 29, Financial Reporting in Hyperinflationary Economies (“IAS 29”) requires that the financial statements of an entity whose functional currency isone of a hyperinflationary economy be measured in terms of the current unit of measurement at the closing date of the financial statements, regardless ofwhether they are based on the historical cost method or the current cost method. This requirement also includes the comparative information of the financialstatements. In order to conclude that an economy is “hyperinflationary,” IAS 29 outlines a series of factors, including the existence of an accumulated inflation ratein three years that is approximately or exceeds 100%. As of December 31, 2018, Argentina reported a cumulative three-year inflation rate greater than 100%and therefore financial information published as from that date should be adjusted for inflation in accordance with IAS 29. The inflation of the subsequent fiscalyears continues to be high and above the 100% accumulated inflation trend for three consecutive years. Therefore, our audited consolidated financial statementsand the financial information included in this annual report have been stated in terms of the measuring unit current at the end of the reporting year. In accordance with IAS 29, the amounts in the financial statements that have not been stated in constant currency as of the end of the reporting periodmust be restated by application of a general price index. To that end and in the manner established in FACPCE’s Resolution JG No. 539/18, coefficients havebeen applied that are calculated on the basis of indices published by the FACPCE, resulting from combining national the consumer prices index (Índice dePrecios al Consumidor—IPC), or CPI, published by the Instituto Nacional de Estadísticas y Censos (the National Statistics and Census Institute), or INDEC,starting on January 1, 2017 and, looking back, domestic wholesale prices index (Índice de Precios Internos al por Mayor—IPIM), or WPI, published by theINDEC or, if none is available, consumer price indices published by the General Directorate of Statistics and Censuses in the Autonomous City of BuenosAires. The variation in the index applied to restate our audited consolidated financial statements for the years ended as of December 31, 2024, 2023 and 2022was 117.8%, 211.4% and 94.8%, respectively. Market Data and Other Information We obtained the market and competitive position data, including market forecasts, used throughout this annual report from internal surveys, marketresearch, publicly available information and industry publications. We include data from reports prepared by ourselves; the Argentine National Association ofPortland Cement Producers (Asociación de Fabricantes de Cementos Portland), or AFCP; the BCRA; the INDEC (the only institution in Argentina with thestatutory authority to produce official nationwide statistics); and the International Monetary Fund, or IMF. INDEC reported that the CPI increase was 94.8%, 211.4% and 117.8% for the years ended December 31, 2022, 2023 and 2024 respectively. INDEC hasalso published inflation figures for the WPI for the year ended December 31, 2022, an increase of 94.8%, for year ended December 31, 2023, an increase of276.4%. and for year ended December 31, 2024, a decrease of 67.1%. See “Item 3.D Key Information—Risk Factors—Risks Relating to Argentina—If the current levels of inflation do not decrease, the Argentine economycould be adversely affected, negatively impacting our results of operations and margins”. Industry publications generally state that the information presentedtherein has been obtained from sources believed to be reliable, but the accuracy and completeness of such information is not guaranteed. While we are notaware of any misstatements regarding the industry data presented herein, estimates and forecasts involve uncertainties and risks and are subject to change basedon various factors, including those discussed under the headings “Special Note Regarding Forward-Looking Statements” and “Item 3.D Key Information—RiskFactors” in this annual report. iv
Page 7
Table of Contents Rounding We have made rounding adjustments to reach some of the figures included in this annual report. As a result, numerical figures shown as totals in sometables may not be an arithmetic aggregation of the figures that preceded them. v
Page 8
Table of Contents CAUTIONARY STATEMENT WITH RESPECT TO FORWARD-LOOKING STATEMENTS AND RISK FACTORS SUMMARY We make forward-looking statements in this annual report within the meaning of Section 27A of the Securities Act of 1933, as amended, or the SecuritiesAct, Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, and the safe harbor provisions of the U.S. Private SecuritiesLitigation Reform Act of 1995, that are subject to risks and uncertainties. These forward-looking statements include information about possible or assumedfuture results of our business, financial condition, results of operations, liquidity, plans and objectives. In some cases, you can identify forward-lookingstatements by terminology such as “believe”, “may”, “estimate”, “continue”, “anticipate”, “intend”, “should”, “would”, “could,” “plan”, “expect”, “predict”,“potential”, “seek”, “likely,” “forecast”, or the negative of these terms or other similar expressions. There are important factors that could cause our actualresults, levels of activity, performance or achievements to differ materially from the results, levels of activity, performance or achievements expressed orimplied by the forward-looking statements. These factors include the principal risks relating to the company and its business described in “Part I, Item 3. KeyInformation—D. Risk Factors,” which are also summarized below: • general economic, political and business conditions, in Argentina, including government policies and as a result of the current government whichtook office in December 2023; • inflation, fiscal deficit, the devaluation of the peso and exchange rate risks in Argentina; • restrictions on the ability to exchange peso into foreign currencies and transfer funds abroad; • implementation of additional exchange controls and restrictions on capital inflows that limit credit availability; • government intervention in the Argentine economy; • developments in markets outside of Argentina that may indirectly affect the Argentine economy; • the cyclical nature of the cement industry; • the competitive nature of the industry in which we operate; • construction activity levels, particularly in the markets in which we operate; • price volatility of the raw materials we sell or purchase to use in our business; • the cost and availability of financing; • energy costs and shortages of electricity and government responses to them; • global economic, political and social conditions and their impact on, including the military conflicts between Russia and Ukraine, Israel andHamas in the Gaza Strip, tensions between China and Taiwan, as well as the potential outbreaks of communicable diseases around the world, andtheir impacts on the global economy and consumer spending patterns, particularly in energy costs; • the impact of the U.S. presidential election results affecting the economy, future government laws and regulations, trade policy matters, such asthe imposition of tariffs, fees and other import restrictions; • transportation, storage and distribution costs; • our direction and future operation and implementation of our principal operating strategies; • the implementation of our financing strategy and capital expenditure plans; • our level of capitalization, including the levels of our indebtedness and overall leverage; • legal and administrative proceedings to which we are or become party (individually or jointly with our controlling shareholder); • existing and future governmental regulations, and our compliance therewith, including tax, labor, antitrust, pension and environmental laws andregulations in Argentina; • the estimation mistakes about the state of our mines and mineral reserves; • operational risks and insurance costs; • risk related with cybersecurity events, including potential cyberattacks; • private investment and public spending in construction projects; vi
Page 9
Table of Contents • early termination of our public concession; • industry trends and the general level of demand for, and change in the market prices of, our products and services; • the development of the judicial recovery process initiated by our controlling shareholder on December 2024; • market volatility and fluctuation of the price of our ADS; and • ongoing costs and risks associated with compliance with the Sarbanes-Oxley Act. The preceding list is not intended to be an exhaustive list of all of our forward-looking statements. The forward-looking statements are based on our beliefs,assumptions and expectations of future performance, taking into account the information currently available to us, and speak only as of the date thereof. Thesestatements are only predictions based upon our current expectations and projections about future events. You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-lookingstatements are reasonable, we cannot guarantee that future results, levels of activity, performance and events and circumstances reflected in the forward-lookingstatements will be achieved or will occur. Except as required by law, we undertake no obligation to update publicly any forward-looking statements for anyreason after the date of this annual report to conform these statements to actual results or to changes in our expectations. vii
Page 10
Table of Contents PART I ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS A. Directors and Senior Management Not applicable. B. Advisers Not applicable. C. Auditors Not applicable. ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE A. Offer Statistics Not applicable. B. Method and Expected Timetable Not applicable. ITEM 3. KEY INFORMATION A. [Reserved] B. Capitalization and Indebtedness Not applicable. C. Reasons for the Offer and Use of Proceeds Not applicable. D. Risk Factors Our business faces significant risks. You should consider carefully the risks described below and all other information contained in this annualreport. If any of the following risks were to occur, our business, financial condition and results of operations would likely be materially adversely affected. Inthat event, the trading price of our ordinary shares or American Depositary Shares, or ADSs, would likely decline and you might lose all or part of yourinvestment. The following risks are not the only risks that we face; we are subject to various risks mainly resulting from changing economic, environmental,political, industry, business, financial and climate conditions. Our results could materially differ from those anticipated in these forward-looking statements, asa result of certain factors including the risks described below and elsewhere in this annual report and our other SEC filings. See also “Cautionary Statementwith Respect to Forward-Looking Statements and Risk Factors Summary”. For purposes of this section, the indication that a risk, uncertainty or problem may or will have a “material adverse effect on us” or that we mayexperience a “material adverse effect” means that the risk, uncertainty or problem could have a material adverse effect on our business, financial condition orresults of operations and/or the market price of our ordinary shares or ADSs, except as otherwise indicated or as the context may otherwise require. You shouldview similar expressions in this section as having a similar meaning. Risks Relating to Argentina Most of our operations, property and customers are located in Argentina and a portion of our liabilities and assets are denominated in foreigncurrency. Consequently, the quality of our assets, property status and our results of operations depend on the macroeconomics, regulatory, social and politicalconditions of Argentina and on the exchange 1
Page 11
Table of Contents rates between the peso and foreign currencies, in particular, the U.S. dollar. These conditions include growth rates, inflation rates, exchange rates, taxes, foreignexchange controls, changes in the interest rates, changes of the state policies, social instability and other domestic and international political and economicevents that may take place in Argentina or may affect it. Investing in a developing economy such as Argentina entails certain inherent risks. Argentina is a developing economy and investing in such markets generally carries risks. These risks include political, social and economicinstability that may affect Argentina’s economic condition. In the past, instability in Argentina was caused by many different factors, including the following: • aggravation of a financial crisis in several countries in the region; • abrupt changes in the monetary and fiscal policies of countries with prominent economies due to macroeconomic conditions; • increase in public expenses affecting the economy and fiscal deficits; • inconsistent fiscal and monetary policies; • uncertainty with respect to the Argentine public sector’s payment capacity and the potential for obtaining international financing; • low levels of investment; • changes in governmental economic or tax policies; • high levels of inflation; • abrupt changes in currency values; • high interest rates; • wage increases and price controls; • exchange and capital controls; • political and social unrest; • the growing effects of labor unions; • the significant price drop of main commodities exported by Argentina; • early termination of our public concession; • fluctuations in the BCRA reserves; • widespread illnesses or epidemics; and • restrictions on exports and imports. Any of the above factors either individually or taken together, could have material adverse effects on the Argentine economy and on our business,results of operations and financial condition. The Argentine economy has experienced extreme volatility in the recent decades, with uneven periods of economic growth, high inflation anddevaluation of the peso against the U.S. dollar. Therefore, our business and operations may be affected by the economic and political events that may affect theArgentine economy, such as: price controls, foreign exchange controls, currency devaluations, high interest rates, increase in public expenses, tax increase orother regulatory initiatives that increase the Argentine government’s intervention in the economy. On September 1, 2019 the Argentine government reintroduced strong restrictions and exchange controls, which, among other things, significantlyrestricted access to the exchange markets by individuals and entities. Since then, these restrictions have been modified and, in some respects, eased, and thosethat remain effective as of the date of this annual report are described in “Item 10.-D Exchange Controls.”. The Social Solidarity and Productive Reactivation Law No. 27,541, enacted in December 2019, and its regulatory Decree No. 99/2019 (the“Social Solidarity Law”), as amended from time to time, introduced important additional foreign exchange restrictions and tax modifications. 2
Page 12
Table of Contents During 2021 there was a recovery of the economic activity (after the impact of COVID-19 in 2020) reflected in the 10.7% GDP growth, and thispositive trend continued in 2022, with 5.0% GDP growth. Nevertheless, in 2023 the GDP decreased by 1.6%. Additionally, in 2024 the GDP decreased by 1.7%compared to 2023. To contain the escalation of the currency exchange rate, the Argentine Central Bank has been selling its reserves of U.S. dollars, which hasresulted in a decrease in the Argentine Central Bank’s international reserves from US$ 65.7 billion as of December 31, 2018, to US$ 23,1 billion as ofDecember 31, 2023. Since Javier Milei took office in December 2023, the BCRA had bought approximately US$ 4,760 million by the end of March 2025.Throughout March and April 2025, growing tensions in the foreign exchange market compelled the central bank to sell reserves, just as the governmentapproached the final stretch of negotiations with the IMF and other multilateral institutions. As previously mentioned, on December 10, 2023, Javier Milei assumed as President of Argentina. In the first days of his mandate, the newgovernment launched a set of policies aimed to deregulate the economy to address the economic and social crisis. On December 20, 2023, through the Decreeof Necessity and Urgency No. 70/2023, the Executive Branch declared the public emergency in economic, financial, fiscal, administrative, social security, tariff,sanitary and social matters until December 31, 2025. This regulation included numerous amendments and repeals of several laws. The measures include, but arenot limited to, the repeal of regulations on housing rental contracts, the supply of essential products, the marketing of mass consumption products, the corporateform of companies where the State participation has been modified, among others. On December 27, 2023, the Executive Branch submitted to Congress the draft law titled "Bases and Points of Departure for the Freedom of theArgentine People" (the "Bases Law"). After months of negotiations, the Bases Law was finally approved on June 28, 2024. The key points of this approval areas follows: • Emergency: The declaration of a public emergency in economic, financial, tax, social security, security, defense, tariff, energy, health, administrative, and social matters. The declaration of emergency in the bill is to last until December 31, 2025, but it enables the Executive to extend such term for twomore years. In terms of state reorganization, the Bases Law establishes the foundations for legislative delegations to the Executive, namely: i)improving the functioning of the state; ii) reducing the oversizing of the state structure; and iii) ensuring effective internal control in the national publicadministration. • Regime for Large Investments: The creation of the 'Regime for Large Investments' ("RIGI"), which establishes a legal and regulatory framework topromote investment in productive projects in Argentina. • Labor Modernization: Various modifications to laws 24,013 (Employment), 20,744 (Labor Contract Law), and 26,727 (Agricultural Work). Moreover,Law 25,323 (Labor Compensation) is repealed. The amendments include the extension of the trial period or the exemption from penalties and criminalactions for those employers who have not made the corresponding contributions, in exchange for the regularization of the worker. • Concessions: The possibility for the government to grant public works concessions to private or public entities for the construction, maintenance, or exploitation of public works.• Various amendments to Laws 17,319 (Hydrocarbons), 24,076 (Natural Gas) and 26,741 (Fiscal Oilfields), including the repeal of Article 1 of Law26,741, which declared the self-supply of hydrocarbons to be of public interest and a priority objective, and the creation of the National Gas andElectricity Regulatory Entity, replacing the Electricity Regulatory Entity (“ENRE”).• Tax Modernization: Various tax changes, including, but not limited to, changes in income tax, personal property tax, single taxation and incentives formoney laundering. On April 16, 2024, the Supreme Court of Justice unanimously rejected two actions filed against Decree No. 70/2023, stating that neither of thempresented the existence of a 'cause,' 'case,' or 'controversy' that falls under the jurisdiction of the Supreme Court to rule on. On July 12, 2024, Congress approved Law No. 27.743 on Palliative and Relevant Tax Measures ('Tax Package') regarding the regularization oftax, customs, and fiscal obligations, aimed at achieving voluntary payment by taxpayers and responsible parties. On that same date, the Executive Branchpublished Decree No. 608/2024 in the Official Gazette, which regulated various provisions of the Tax Package. Chapter II of this Decree specifically outlinesthe Asset Regularization Regime, designed to incentivize taxpayers to declare unregistered assets. The Asset Regularization Regime was structured in threestages. The first stage ran from October 1, 2024, to November 8, 2024, inclusive, during which a 5% rate was applied to amounts exceeding USD 100,000. Thesecond stage took place from November 9, 2024, to January 31, 2025, inclusively, with the rate increasing to 10%. Finally, the third stage covered the periodfrom February 1, 2025, to 3
Page 13
Table of Contents April 30, 2025, inclusively, with the rate rising to 15%. The regime ultimately reached USD 116.8 billion, making it the second largest of its kind in worldhistory, after Indonesia. This outcome surpassed initial expectations under the Milei administration. On August 5, 2024, Decree No. 695/2024 was published in the Official Gazette, regulating, among other matters, four chapters of Title II of theBases Law: (i) Administrative reorganization; (ii) Privatizations; (iii) Administrative procedure; and (iv) Public employment. A week later, on August 12, 2024,Decree No. 713/2024 was issued, advancing the regulation of Title III of the Bases Law, specifically addressing 'Contracts and Transactional Agreements,' withparticular focus on Chapter I, 'Force majeure in existing contracts and transactional agreements,' as well as certain articles of Chapter II, 'Concessions.'Additionally, on August 23, 2024, the Executive Branch published Decree No. 749/2024, which regulated Title VII of the Bases Law in relation to the RIGI. On November 29, 2024, the Executive Branch published Decree 1057/2024 in the Official Gazette, where the amendments introduced by theBases Law to the Hydrocarbons Law, the Gas Law No. 24,076 and the aspects related to the uniform environmental legislation for the sector were regulated. Regarding Argentina's capacity to obtain financing from international capital markets, on May 13, 2024, the IMF announced that its ExecutiveBoard and Argentine authorities had reached an agreement on the eighth review under the agreement with Argentina. As a result, the Board's decision allowedan immediate disbursement of approximately US$ 800 million, bringing the total disbursements under the agreement to approximately US$ 41.4 billion. TheStaff-Level Agreement aims at lowering the fiscal deficit, inflation and subsidies, among others, with the goal of promoting the necessary stability conditions toaddress existing structural challenges and to strengthen the foundations for sustainable and inclusive growth. Additionally, on March 19, 2025, the ArgentineCongress validated the presidential decree authorizing the execution of a new debt refinancing agreement with the IMF, which, according to the technicalagreement reached by the IMF and the Argentine authorities on April 8, 2025, would enable a new extended funding facility of US$ 20 billion over a period of48 months. The IMF Executive Board approved said agreement on April 11, 2025. In January 2025, the IMF Executive Board evaluated Argentina's exceptional access to financing under the 2022 Extended Fund Facility. Althoughthe program did not meet its initial objectives, it allowed for the rescheduling of payments. The program's gradual approach was insufficient to address theeconomic challenges. However Milei’s administration renegotiated new targets and, in 2024, met all the established parameters, except for the accumulation ofnet reserves. The IMF in its report from January 2025, projects that Argentina's GDP will stabilize, with a projected annual economic growth of 5.0% for 2025and 2026. They estimate a year-on-year inflation of 23.2% for 2025. A decline in international demand for Argentine products, a lack of stability and competitiveness of the peso against other currencies, a decline inconfidence among consumers and foreign and domestic investors, a higher rate of inflation and future political uncertainties, adverse climate conditionsaffecting agriculture, among other factors, may continue to adversely affect the development of the Argentine economy, which could lead to a reduced demandfor our products and services and adversely affect our business, financial condition and results of operations. If current fiscal surplus is not maintained, the Argentine economy could be adversely affected, negatively impacting our business and results of operation. In the past, Argentina has had important macroeconomic imbalances, including frequent and critical fiscal deficits. The Argentine government hashad yearly fiscal deficit during approximately 90% of the period comprising 1961 to 2022 (48 years out of 53), which has led to very vulnerablemacroeconomic conditions. The Argentine government has financed its fiscal deficit mainly in two ways: (i) by issuing foreign debt, which has historically ledto rapid increments in national debt levels; and (ii) by monetary emission through the BCRA, which has led to periods of high inflation and, even in somecases, hyperinflation. The fiscal deficit reached 3% of the GDP in 2021, 2.4% of the GDP in 2022 and 2.9% of the GDP in 2023. However, as a result of themeasures taken by Javier Milei´s administration, a financial surplus of 0.3% of GDP was recorded in December 2024, marking the first surplus since 2010. Failing to maintain the current fiscal surplus and reverting to the historical deficits could lead to growing levels of uncertainty regardingArgentina’s macroeconomic conditions. In particular, it could lead to growing inflation rates and unanticipated foreign exchange depreciation and balance ofpayments crisis, higher local vulnerability to international credit crisis or geopolitical shocks, higher interest rates and erratic monetary policies, a reduction inreal salaries and as a consequence, in private consumption, and a reduction in growth rates. This level of uncertainty, over which we have no control, mayadversely affect our financial condition or results of operations. 4
Page 14
Table of Contents If the current levels of inflation do not decrease, the Argentine economy could be adversely affected, negatively impacting our results of operations andmargins. Historically, inflation has materially undermined the Argentine economy and the Argentine government’s ability to create conditions for long-termeconomic growth. In recent years, Argentina has experienced high inflation rates. Since 2008, the Argentine economy has been subject to strong inflationary pressures that, according to private sector analysts, reached an averageannual rate of 28.2% between 2010 and 2015. In December 2015, the administration of former President Macri suspended the publication of indexes andstatistics and, after implementing certain methodological reforms and adjusting certain macroeconomic statistics, resumed its publication of the CPI in June2016. Based on the revised information provided by INDEC, inflation reached an annual rate of 94.8% in 2022, 211.4% in 2023 and 117.8% in 2024. Efforts by successive governments to curb inflation, including price controls and regulation of exports, have faltered, failing to address thestructural causes of inflation. Former President Alberto Fernández's administration aimed to shield consumers through price ceilings on essentials and exportlimits, but recorded fiscal deficits of 2.4% in 2022 and 2.9% in 2023. The current government achieved a primary surplus of 1.8% of GDP in 2024. Controlling inflation remains a significant challenge. Failure to rectify structural inflationary imbalances could perpetuate rising inflation levels,adversely affecting Argentina's economy. High inflation undermines foreign competitiveness, exacerbates social and economic inequality, and erodesconfidence in the banking system, potentially restricting credit access for local companies. Inflation in Argentina has contributed to a material increase in our costs of operation, in particular labor costs; it also enables a reduction in thepurchasing power of the population, thus increasing the risk of a lower level of product consumption from our customers in Argentina, which could negativelyimpact our financial condition and results of operations. Inflation rates could continue to grow in the future, and there is uncertainty regarding the effects thatany measures adopted by the government could have to control inflation. Fluctuations in the peso exchange rate, including potential appreciation or depreciation may adversely affect our results of operations, our capitalexpenditure program, and the ability to service our liabilities and transfers of funds abroad. Argentina has a history of high volatility in its foreign exchange markets, including sharp and unanticipated devaluations, tight foreign exchangecontrols and severe restrictions on foreign trade. While the devaluation of the peso may have a negative impact on the ability of certain Argentine businesses topay their foreign currency denominated debt and could lead to higher inflation and reduced real wages, a significant appreciation of the peso could make ourproducts more expensive in both domestic and international markets, potentially reducing demand and jeopardizing our business, which depends on domesticmarket demand. After several years of moderate variations in the nominal exchange rate, in 2011 the depreciation of the peso commenced to accelerate again andin response the Argentine government further strengthened the foreign exchange restrictions and controls. This provoked the development of an unofficial U.S.dollar trading market at which the U.S. dollar exchange rate was substantially higher than in the official foreign exchange market (the “FX Market”). Given the political and economic landscape, the administration of former President Macri re-introduced rigid restrictions and foreign exchangecontrols on September 1, 2019, which among other things, significantly curtailed access to the FX Market by individuals and entities. See "Item 10.DAdditional Information—Exchange Controls”. Despite the measures adopted by the Argentine government to try to control the increasing depreciation of thepeso, in 2022 the peso depreciated by approximately 70% and in 2023, by approximately 356% against the U.S. dollar, based on the official exchange ratespublished by the Argentine Central Bank. On December 12, 2023, the Minister of Economy, Luis Caputo, announced the setting of the official exchange rate at Ps. 800 and a 2% monthly“crawling peg.” This resulted in an exchange rate jump of 118.57% for the wholesale dollar and a sharp depreciation of the peso against the dollar. The pesoaccumulated a depreciation of 26.7% in 2024. Furthermore, on January 13, 2025, the BCRA announced a reduction in the pace of the crawling peg from 2% to1% per month, effective from February 1, 2025. This measure is part of a context of decelerating inflation and peso appreciation. In this context, thedepreciation of the peso during the first three months of 2025 was 3.85%. This recent appreciation in real terms makes Argentine products, including ours, moreexpensive, potentially affecting the level of 5
Page 15
Table of Contents activity of the construction industry. By December 2024, the official exchange rate had increased 27.7% compared to its value at the end of the previous year.Additionally, several parallel U.S. dollar trading markets developed in which the Argentine peso-U.S. dollar exchange rate differs from the official Argentinepeso-U.S. dollar exchange rate. See "Item 10.D “Additional Information – Exchange Controls”. While the depreciation of the peso can have positive effects on the competitiveness of certain sectors of the Argentine economy, including ourbusiness, significant appreciation or continued volatility can negatively impact our competitive position and profitability. Furthermore, both devaluation andappreciation of the peso have had and could continue to have a negative impact on the financial condition of many Argentine businesses and individuals. Thedevaluation of the peso has negatively affected the ability of certain Argentine businesses to honor their foreign currency-denominated debt and has also led tovery high inflation initially and significantly reduced real wages. Conversely, a significant appreciation of the peso could negatively impact businesses whosesuccess is dependent on export markets. Both scenarios can adversely affect the Argentine government’s ability to honor its foreign debt obligations. Significantdepreciation or appreciation of the peso, or increased exchange rate volatility, could adversely affect the Argentine economy and, consequently, our business. Additional volatility, appreciation, or depreciation of the peso, or reduction in the BCRA’s international reserves due to currency interventionscould adversely affect the Argentine economy, which in turn may have an adverse effect on our financial conditions and results of operations. Any furthersignificant fluctuation in the value of the peso could have material adverse effects on the Argentine economy, which could have a material adverse effect on ourresults of operations and financial condition. Given the economic and political conditions in Argentina, we cannot predict whether, and to what extent, the value of the peso may depreciate orappreciate against the U.S. dollar, the euro or other foreign currencies. We cannot predict how these conditions will affect our capital expenditure program, theconsumption of products we provide to local customers or our ability to meet our liabilities denominated in currencies other than the peso. Furthermore, ourability to transfer funds abroad and our ability to pay dividends to shareholders located abroad may be jeopardized if high exchange rate volatility continues andexchange controls are increased in Argentina. Finally, we cannot predict whether the Argentine government will further modify its monetary, fiscal or exchangerate policy in the future. Government measures, as well as pressure from labor unions, could require private companies to implement salary increases or provide workers withadditional benefits, all of which could increase our operating costs. Labor relations in Argentina are governed by specific legislation, such as Labor Contract Law No. 20,744 and Collective Bargaining Law No.14,250, which, among other things, dictate how salary and other labor negotiations are to be conducted. Every industrial or commercial activity in Argentina isregulated by a specific collective bargaining agreement, or CBA, that groups companies together according to industry sector and trade union. Although theprocess of negotiation is standardized, each chamber of industrial or commercial activity separately negotiates the increases of salaries and labor benefits withthe relevant trade union covering such commercial or industrial activity. In the cement industry, salaries have been established generally on an annual basis(although due to the high inflation over the past years, these are taking place more than once a year) through negotiations between the chambers that representthe cement producers and the cement industry employees’ trade union. The national labor authority (National Secretary of Labor, Employment and SocialSecurity) mediates between the parties and ultimately approves the salary increase to be applied in the cement industry. Parties are bound by the final decisiononce it is approved by the labor authority and must observe the established salary increases for all employees that are represented by the cement union and towhom the collective bargaining agreement applies. Argentine employers, in both the public and private sectors, have experienced significant pressure from their employees and labor organizations toincrease wages and to provide additional benefits. Since December 2023, the minimum salary was raised from Ps. 156,000 to Ps. 279,718, as of December 2024(in nominal terms). Due to high levels of inflation, both public and private sector employers experience significant pressure from unions and their employees tofurther increase salaries. The INDEC publishes the "Coeficiente de Variación Salarial" (Salary Variation Index), an index that shows the evolution of salaries.The Salaries Index showed an increase in registered private sector salaries of approximately 165.8% in 2023 and 147.5% in 2024. During this period, theaverage wages in the cement industry increased in line with the average of private sector salaries, according to the Argentine Secretary of Labor, Employmentand Social Security. 6
Page 16
Table of Contents In the past, the Argentine government adopted measures that determined salary increases or additional benefits for workers. Workers and theirunions can press employers to grant salary increases or obtain other benefits. Any salary increase or additional benefit could result in an increase in costs and adecrease in the results of the operations of Argentine companies, including those of Loma Negra. The implementation of exchange controls and restrictions on capital inflows and outflows could limit the availability of international credit and couldthreaten the financial system, adversely affecting the Argentine economy and, as a result, our business. Due to the foreign exchange crisis generated in August 2019 and the continued reduction of the BCRA’s foreign currency reserves, sinceSeptember 1, 2019, the Argentine government imposed rigid exchange controls and transfer restrictions, substantially limiting the ability to obtain foreigncurrency or make certain payments or distributions out of Argentina See “Item 10.D Additional Information—Exchange Controls”. In response to the re-imposed foreign exchange restrictions, an unofficial U.S. dollar trading market developed again in which the peso-U.S. dollarexchange rate differed substantially from the official peso-U.S. dollar exchange rate in the FX Market. In addition, access to foreign currency and its transfer out of Argentina can also be obtained through capital markets transactions denominatedBlue-Chip Swaps, subject to certain restrictions and side effects which is more expensive than acquiring foreign currency in the FX Market. Notwithstanding the measures adopted by the Argentine government in the past years, it is worth noting that President Javier Milei'sadministration has been gradually easing foreign exchange controls. However, future actions by the Argentine government could include reinstating furtherexchange controls, transfer restrictions, restrictions on the free movement of capital, and may implement other measures in response to capital flight or asignificant depreciation of the peso, which could further limit our ability to access the international capital markets and impair our ability to make interest,principal or dividend payments abroad. Such measures could lead to renewed political and social tensions, and could undermine the Argentine government’spublic finances, which could adversely affect Argentina’s economy and prospects for economic growth and, consequently, adversely affect our business andresults of operations, and could further impair our ability to make dividend payments to holders of the ADSs, which may adversely affect the market value ofthe ADSs. Argentina’s current account and balance of payment imbalances could lead to a depreciation of the peso, and as a result, affect our results of operations,our capital expenditure program and our ability to pay our foreign currency liabilities. Inflation continues to be a challenge for Argentina given its persistent nature in the past years. According to INDEC, Argentina’s structural current account accumulated a surplus of US$ 3,287 million in 2021 and a current account deficit ofUS$ 3,031 million in 2022. In 2023, the Argentine economy recorded a current account deficit of US$ 6,900 million. However, in 2024, the Argentinegovernment registered a current account surplus of US$ 1,029 million for 2024 as a result of cost reduction policies. Because foreign direct investment remains stagnant in Argentina, Argentina and its provinces may not be able to fulfill their debts obligations inthe future, since Argentina’s foreign currency needs would severely overcome its foreign currency sources. If this level of uncertainty prevails on internationalinvestors, Argentina may suffer a “sudden stop” event, when investors stop lending money to Argentinean institutions. This, in turn, may result in large capitaloutflows that could lead the Argentine government to default on its debt and cause a rapid and unanticipated depreciation of the peso, an increase in localinterest rates and a banking system crisis if bank deposits are largely withdrawn following social unrest.The measures taken during former president Fernandez administration could not stop the constant devaluation of the peso against the U.S. dollar. Between January 2020 and December 2023, the official nominal exchange rate for pesos into U.S. dollars fell by approximately 1250.80%. As of December 31, 2024, the official nominal exchange rate for pesos into U.S. dollars fell to Ps. 1032.5 per US$1.00, a devaluation ofapproximately 27.7%. Furthermore, as of April 4, 2025, the official nominal exchange rate reached Ps. 1075,88 per US$ 1.00 reflecting a 24.85% variationcompared to the same date of the previous year. 7
Page 17
Table of Contents The failure to reduce fiscal deficits could increase the level of uncertainty regarding the macroeconomic conditions in Argentina. In particular, itcould lead to an increase in the inflation index, devaluation of the peso with respect to foreign currencies and a subsequent crisis in the balance of payments,greater local vulnerability to the international credit crisis or geopolitical shocks, rising rates of interest, erratic monetary policies, reduction in real wages and,as a consequence, in private consumption and reduction in growth rates. This level of uncertainty, over which we have no control, can affect our financialcondition or the results of operations. If a balance of payments crisis were to occur, a large depreciation of the peso against the U.S. dollar could adversely affect our ability to meet ourforeign currency obligations. Furthermore, the negative effect such a crisis could have on the growth rates of the Argentine economy and its consumptionpatterns could have a material adverse effect on our business, financial condition and result of operations. The Argentine government’s ability to obtain financing from international markets may be limited, which may negatively impact our financial conditionand our ability to grow. Argentina’s sovereign default in 2001 limited its ability to access international financing. Through exchange offers conducted between 2005 and2010, Argentina restructured over 92% of the sovereign defaulted debt. However, holdout holders declined to participate in the restructuring commencedlitigation against Argentina. The Argentine government settled US$9.2 billion outstanding principal amount of the untendered debt held by some of theseholdout holders in April 2016 with the proceeds from a US$16.5 billion international bonds offering. Although the size of the outstanding claims has decreasedsignificantly, as of the date of this annual report, litigation initiated by bondholders that have not accepted Argentina’s settlement offer continues in severaljurisdictions. However, after the settlement with the holdouts and offering Argentina regained access to the international capital markets. Additionally, foreign shareholders of several Argentine companies, including those of our controlling shareholder, have filed claims before theInternational Center for Settlement of Investment Disputes or the ICSID alleging that the emergency measures adopted by the Argentine government since thecrisis in 2001 and 2002 differ from the just and equal treatment standards set forth in several bilateral investment treaties to which Argentina is a party. TheICSID has ruled against Argentina with respect to many of these claims. Moreover, Argentina's ability to obtain financing from international capital markets has historically been subject to various limitations andchallenges, as evidenced in past years, where the need to resort to international organizations has been recurring. In 2018, the IMF´s executive board approvedthe Stand-By Agreement with the Argentina government, which involved the disbursement of US$ 44 billion. On January 28, 2022, the IMF and the ArgentineGovernment reached an understanding to restructure the current debt with the IMF though an Extended Fund Facility Arrangement which was approved by theIMF’s executive board on March 3, 2022, and approved by the Argentine Congress on March 17, 2022. Ultimately, the Extended Fund Facility Arrangementwas approved definitely by the IMF´s executive board on March 25, 2022. The Extended Fund Facility Arrangement seeks to continue creating the necessarystability conditions to address existing structural challenges and to strengthen the foundations for sustainable and inclusive growth. In accordance to theExtended Fund Facility Arrangement, Argentina will be paying its debt from 2026 to 2034. On August 4, 2023, through the Decree 404/2023 a loan agreement between Argentina and Qatar for 580,000,000 Special Drawing Rights wasapproved in an attempt to pay interest on the debt contracted with the IMF. In this regard, the Argentine government announced the cancellation of US$ 1,411million within the framework of the agreement. The Issuer cannot attest to what effects the agreement will have nor to how it will be implemented. Moreover,on August 23, 2023, former Economy Minister, Sergio Massa, announced agreements with the World Bank and the Inter-American Development Bank thatdetermined that these entities would provide Argentina with total financing of US$ 1,310 million. Furthermore, through the press release of February 1, 2024, IMF’s Executive Board announced the conclusion of the seventh review of theagreement with Argentina. This decision grants the country access to an immediate disbursement of approximately USS 4.7 billion, which would place the totaldisbursements under the agreement at around USS 40.6 billion so far. On the other hand, in the press release dated May 13, 2024, the IMF announced that the IMF Executive Board and Argentine authorities reachedan agreement on the eighth review under the agreement with Argentina. As a result, the Board's decision allowed an immediate disbursement of approximatelyUS$ 800 million (or SDR 600 million), bringing the total disbursements under the agreement to approximately US$ 41.4 billion. Furthermore, on March 19,2025, the 8
Page 18
Table of Contents Argentine Congress validated the presidential decree authorizing the execution of a new debt refinancing agreement with the IMF. On April 8, 2025, the IMFreached a technical agreement with the Argentine government for a new US$ 20 billion extended facility over 48 months, subject to quarterly target reviews anda repayment term of 10 years. This agreement was approved by the IMF Executive Board on April 11, 2025, authorizing disbursements for up to US$ 15 billionin 2025 and are available for use without specific restrictions, providing Argentina flexibility in addressing its financial needs. In addition, the Ministry of Economy is negotiating additional financing with other international organizations for an amount of approximatelyUS$ 6.1 billion. Moreover, the BCRA announced that it will work with international banks in a new tender to extend the Repurchase Agreement (Repo) facilityexecuted in January 2025 in an amount of up to US$ 2 billion. Finally, the BCRA has agreed to a new 12-month extension of the activated tranche of the currency swap with the Central Bank of China (PBOC)(approximately US$ 5 billion). In January 2025, the IMF Executive Board evaluated Argentina's exceptional access to financing under the 2022 Extended Fund Facility. Althoughthe program did not meet its initial objectives, it allowed for the rescheduling of payments. The program's gradual approach was insufficient to address theeconomic challenges; however, the measures implemented by the government of Javier Milei contributed to stabilization. In this context, Milei’s administrationrenegotiated new targets and, in 2024, met all the established parameters, except for the accumulation of net reserves. Following a renegotiated agreement, thefirst disbursement of US$12 billion was made on 15 April 2025. This inflow brought Argentina’s international reserves to US$36,799 million. In any case, lack of access to international or domestic financial markets or increase in the costs of such financing could affect the projectedcapital expenditures for our operations in Argentina, which, in turn, may have an adverse effect on our financial condition or the results of our operations. Formore information regarding Argentina’s financings, including the aggregate of US$23.5 billion loans disbursed in connection with the Staff-Level Agreement,see “—Investing in a developing economy such as Argentina entails certain inherent risks.” Government intervention may adversely affect Argentine economy, Argentine companies and, as a result, our business and results of operations. During recent years, the federal government has exercised substantial control over the Argentine economy. In December 2019, Alberto Fernández assumed the presidency of Argentina and implemented several measures that increased state intervention,such as: i) the Social Solidarity Law; ii) the Price Control Program; iii) the Public Debt Sustainability Law under Foreign Law; iv) the Shelving Law; and v)Decree No. 690/2020, which regulated the tariffs of certain services. In this same regard, on September 1, 2019, strict exchange controls and restrictions werereinstated, limiting access to the Foreign Exchange Market for purchases and transfers of foreign currency outside Argentina. The Argentine Executive Branch issued the Decree No. 332/2022 which established a progressive reduction of state´s aid in relation to thepayment of electric and natural gas services. This reduction depends on the income of the consumer. Under this system, higher income consumers will bepaying their tariffs with no state aid in the future, whereas vulnerable and low-income consumers will still receive state aid. The National Telecommunications Agency, issued Resolution No. 1754/2022, which established a maximum fee increase for mobile services, aswell as use of internet value added services, subscription radio broadcasting services and subscription broadcasting services through satellite by certainlicensees. Interventions by the Argentine government similar to those described above can have an adverse impact on the level of foreign investment inArgentina, the access of Argentine companies to the international capital markets and Argentina’s commercial and diplomatic relations with other countries and,consequently, could adversely affect our business, financial condition and results of operations. As of the date of this annual report, the potential for the current administration to introduce further price control measures on our products remainsuncertain. Should such measures be enacted, their impact on our operations and financial results cannot be predicted. Government actions like expropriationsand interventions, as previously described, 9
Page 19
Table of Contents could harm foreign investment levels, limit access to international capital markets for Argentine companies, and strain Argentina's commercial and diplomaticrelationships. These outcomes could negatively affect our business, financial health, and operational results. Conversely, the Milei Administration is steering towards reducing government intervention through deregulation efforts aimed at alleviating theeconomic and social crisis. However, it is not possible to predict the level of success of such efforts and measures and their impact in our operations andfinancial performance. The Argentine economy could be adversely affected by economic developments in other markets and by more general “contagion” effects. Weak, flat or negative economic growth in any of Argentina’s major trading partners, such as Brazil, could adversely affect Argentina’s balance ofpayments and, consequently, economic growth. The Argentine economy may also be affected by conditions in developed economies, such as the United States, that are significant trading partnersof Argentina or have influence over world economic cycles and over short-term evolution of commodity prices. If interest rates increase significantly indeveloped economies, including the United States, Argentina and its developing economy trading partners, such as Brazil, could find it more difficult andexpensive to borrow capital and refinance existing debt, which could adversely affect economic growth in those countries. Decreased growth from Argentina’strading partners could have a material adverse effect on the markets for Argentina’s exports and, in turn, adversely affect economic growth. Any of thesepotential risks to the Argentine economy could have a material adverse effect on our business, financial condition and result of operations. The economy of Brazil, Argentina’s largest export market and the principal source of imports, is currently experiencing heightened negativepressure due to the uncertainties stemming from ongoing political crisis. After the economic crisis of 2015 and 2016, the Brazilian economy is slowlyrecovering. The real growth per capita has recovered 10% in 2021, but is still 15% down from 2019 figures. As of December 31, 2022, the unemployment ratewas 8.3%, as compared to 11.9% at the end of 2021. As of December 31, 2024, the unemployment rate is 6.2% as compared to 7.4% at the end of 2023. OnJanuary 1, 2022, Lula da Silva assumed office as a left-wing politician. While the impact of Brazil’s downturn on Argentina cannot be predicted, we cannotexclude the possibility that the Brazilian political and economic crisis could have a further negative impact on the Argentine economy. Notwithstanding the foregoing, a new devaluation of the Brazilian real similar to the one that occurred in 2024 (which, from the beginning of2024 until January 2025, reached nearly 20%) could result in a decline in Argentine exports and a loss of competitiveness, along with an increase in imports, asBrazilian goods would become more price-competitive in international markets. This could potentially adversely affect the growth of the Argentine economyand its financial position. International political events and commodity price volatility could adversely affect Argentina’s economy Changes in social, political, regulatory, and economic conditions in the United States, particularly concerning trade policies, could createuncertainty in international markets and negatively impact emerging market economies, including the Argentine economy. This could, in turn, have a negativeimpact on our business, results of operations, and financial condition. On November 5, 2024, Donald Trump was elected President of the United States. Sincetaking office on January 20, 2025, his administration has enacted significant trade tariffs affecting global markets. Notably, a 104% levy on Chinese importsfollowing increased retaliatory actions by China. These tariffs were escalated from previous rates due to diplomatic tensions and are expected to rise theaverage tariff on Chinese exports to the U.S. to nearly 125%. Meanwhile, other countries, including the European Union, face new tariff rates ranging from11% to 50%. These measures contribute to market instability and may disrupt trade flows to Argentina, impacting import costs and the broader economy. Theseactions, along with potential further retaliatory measures from China—such as tariffs on U.S. agricultural products and restrictions on market access—threatenglobal trade stability and could disrupt economic conditions, impacting Argentina through altered trade flows and increased costs for imported goods crucial tovarious sectors, including ours. Meanwhile, the long-standing geopolitical tensions have not abated. On February 24, 2022, Russian military forces launched a major assaultagainst Ukraine, which led to a conflict that is ongoing as of the date of this annual report. Trade disruptions caused during 2022 and 2023 by the conflict andeconomic sanctions caused instability and increases in 10
Page 20
Table of Contents the prices of energy which affected the costs of our products. Despite the fact that during 2024 the energy market normalized, we cannot estimate the futureimpact on our operations that the continuation of this conflict may cause. The October 7, 2023, assault by Hamas on Israel further exacerbated geopolitical instabilities, culminating in Prime Minister Netanyahu'sdeclaration of war and a full blockade on Gaza. Subsequent military actions, including those between Israel and Iran, have heightened the prospect of extendedconflict, potentially involving more nations and impacting global trade dynamics, affecting emerging markets such as Argentina. Even though a ceasefire was reached on January 19, 2025, between Israel and Hamas, allowing for humanitarian aid, the region remainspolitically fragile. The withdrawal from the Netzarim Corridor and U.S. President Trump’s plan for Gaza underline ongoing tensions. Argentina is highly dependent on the export of certain commodities, such as soy, which has made the Argentine economy more vulnerable tofluctuations in the commodities prices. If international commodity prices decline, the Argentine economy could be adversely affected. In addition, adverseweather conditions can affect the production of commodities by the agricultural sector, which account for a significant portion of Argentina’s export revenues. All these circumstances could have a negative impact on the levels of government revenues, available foreign exchange and the government’sability to manage its sovereign debt, and could either generate recessionary or inflationary pressures, depending on the government’s reaction. Either of theseresults would adversely impact Argentina’s economic growth and, therefore, our financial condition and results of operations. The Argentine banking system may be subject to instability, which may affect our operations. The Argentine banking system has experienced several crises in the past, and even collapsed in 2001 and 2002. In recent years, the Argentinefinancial system grew significantly with a marked increase in loans and private deposits, showing a recovery of the credit activity. Such recovery has beenseverely impacted by the COVID-19 pandemic. Although the financial system’s deposits continue to grow in nominal terms, these deposits are mostly short-term and the sources of medium and long-term funding for financial institutions are currently limited. During 2024, the financial system accrued earnings and maintained high soundness indicators, reinforcing its resilience against potential risks.The provision of payment services continued to grow along the year. Moreover, throughout the year, the stock of financing in pesos to the private sectorregained momentum and accumulated an increase of 49.4% year-on-year in real terms, across all groups of financial institutions. The stock of credit in foreigncurrency to the private sector increased 16.8% in the last month of the year (in original currency), tripling in year-on-year terms. Additionally, the broadliquidity of the financial system in pesos represented 35.9% of pesos deposits at the end of the year, while the corresponding ratio for the U.S. Dollars segmentstood at 72%. Both in monthly and year-on-year comparisons, these ratios decreased as a result of the sustained increase in credit to the private sector. Whenconsidering all sectors and currencies, the real balance of total deposits slightly decreased in December (0.4% real), remaining unchanged in a year-over-yearcomparison. In 2024, fixed-term deposits in pesos from the private sector, as well as means of payment, have shown a decelerated decline due to the drop ininflation as well as in the interest rates. Fixed-term placements have experienced a monthly increase of 3.3% at constant prices as of December 2024. Financial institutions are subject to significant regulation from multiple regulatory authorities, all of whom may, among other things, establishlimits on commissions and impose sanctions on financial institutions. The lack of a stable regulatory framework could impose significant limitations on theactivities of the financial institutions and could induce uncertainty with respect to the financial system stability. A new crisis or the consequent instability of one or more of the larger banks, public or private, could have a material adverse effect on theprospects for economic growth and political stability in Argentina, resulting in a loss of consumer confidence, lower disposable income and fewer financingalternatives for consumers. These conditions would have a material adverse effect on us by resulting in lower sales of products and the possibility of a higherlevel of uncollectible accounts or increase the credit risk of the counterparties regarding our investments in local financial institutions. 11
Page 21
Table of Contents Exchange controls and restrictions on transfers abroad and capital inflows have limited, and could continue limiting, the availability ofinternational credit. The continued limitation of international credit could have a material adverse impact on our financial condition, results of operations andcash flows. Foreign Exchange Controls Affecting Imports of Goods and Services could adversely affect our business. Argentine companies currently have access to the foreign exchange market to acquire foreign currency to make payments abroad, provided thatcertain requirements are met. Access to the exchange market may be granted for the payment of new imports of any type of goods as of April 14, 2025 as from the date ofcustoms clearance. We cannot ensure you that additional limitations to import goods and services to Argentina will not be reestablished in the future. In this sense, weare unable to estimate the economic and financial impact for our business, or the possibility of other economic effects on the stock market, foreign exchangerates and otherwise. Any such negative impact could result in a material adverse effect on our business, liquidity, financial conditions and results of operations,as well as our ability to achieve our previously disclosed expectations for future years. Disruption or volatility in global financial and credit markets could have a material adverse effect on us. The global financial and credit markets are currently experiencing, and have from time to time experienced, extreme volatility and disruptions,including severely diminished liquidity and credit availability, rising interest and inflation rates, declines in consumer confidence, decreases in economicgrowth, increases in unemployment rates, and uncertainty about economic stability. Such volatility and uncertainty have increased the cost of funding forArgentine and international issuers and borrowers. Recent events have created bank-specific and broader financial institution liquidity risks and concerns. Uncertainty remains regarding liquidityconcerns in the financial services industry and potential impacts on the broader global economy. Our business, partners, and the industry as a whole may beadversely impacted in ways that are currently unpredictable. If banks and financial institutions face insolvency or significant financial challenges in the future,based on systemic conditions affecting the banking system and financial markets, our access to existing cash, cash equivalents, and investments may bethreatened, possibly causing a material adverse effect on our business and financial condition. Moreover, if any of our customers, suppliers or other parties with whom we conduct business are unable to access funds, their ability to meetobligations to us or engage in new commercial arrangements requiring further payments or funding could be adversely affected. Investor concerns regarding theU.S. or international financial systems could result in less favorable commercial financing terms, including higher interest rates or costs and tighter financialand operating covenants, or systemic limitations on access to credit and liquidity sources, making it more difficult for us to acquire financing on acceptableterms or at all. Any material decline in available funding could have a material adverse effect on us. Risks Relating to Our Indirect Controlling Shareholder Adverse events affecting affiliates of our indirect controlling shareholder, Mover Participações S.A., including with respect to the involvement by asubsidiary of Mover Participações S.A. in the so-called Operation Car Wash investigation in Brazil (“Operação Lava Jato”), may have a material adverseeffect on our reputation and on the trading price of our ordinary shares and ADSs. Construções e Comércio Camargo Corrêa S.A., or CCCC, a construction and engineering subsidiary of Mover Participações S.A. (formerly namedCamargo Corrêa S.A.) and certain of its former senior management and employees have been the subjects of a Brazilian Federal Police investigation referred toas Operation Car Wash, which is an investigation into widespread allegations of corruption, including the Brazilian federal government controlled national oilcompany Petróleo Brasileiro S.A.—Petrobras, where certain of its employees accepted bribes from a number of construction companies, including CCCC. In connection with the Operation Car Wash investigation and comprehensive internal investigations undertaken by CCCC with the assistance ofexternal experts, CCCC and certain of its former senior management and employees entered into leniency and plea bargain agreements with the Brazilianauthorities pursuant to which they admitted to violations of Brazilian antitrust and anti-corruption laws and agreed to pay compensation totaling more than 12
Page 22
Table of Contents 1,400 million Brazilian reais, which included fines and other indemnification, and committed to continue to cooperate with Brazilian authorities. In addition,CCCC continues to conduct internal investigations on an ongoing basis regarding its anti-corruption compliance. The news of Operation Car Wash also had repercussions in other Latin America countries where CCCC operates besides Brazil, including Peru,Argentina and Venezuela. According to certain media reports, government investigations are underway in those countries for alleged acts of corruptioninvolving Brazilian construction companies. CCCC’s management has conducted internal investigations with the help of external experts and to date has notidentified evidence of any wrongdoing performed by CCCC in these countries. Any additional violations of anti-corruption and/or antitrust laws involving CCCC may result in additional fines and/or indemnificationobligations. In addition, any additional adverse events or developments could have a material adverse impact on CCCC and the Mover investment portfolio,which may subject us to reputational damage and could materially adversely affect the trading price of our ordinary shares and ADSs. Moreover no assurancescan be given that affiliates of CCCC will not also be found to be liable for any such violations of law. See ‘Item 7.A. Major Shareholders — Significant Changes in Percentage Ownership’. The judicial reorganization process of our controlling shareholder may have an adverse effect on our business, financial condition or results of operationsand/or the market price of our ordinary shares or ADSs InterCement Participações S.A., our controlling shareholder, is currently undergoing a judicial reorganization process (recuperação judicial) inBrazil following the inability to reach a comprehensive agreement with creditors through its previous out-of-court restructuring efforts. The judicialreorganization process is intended to legally protect and facilitate the restructuring of our controlling shareholder’s financial obligations, introducing uncertaintyregarding its future business operations and financial stability. The duration of the judicial reorganization process is uncertain and we have no participation inthat process. The judicial reorganization process of our controlling shareholder could result in a change of control with respect to our Company, and could alsoaffect market perception and investor confidence in Loma Negra, which could in turn have a material adverse effect on our business, financial condition orresults of operations and/or the market price of our ordinary shares or ADSs. Risks Relating to Our Business and Industry The cyclical nature of the cement industry may lead to decreases in our revenues and profit margin. The cement industry is inherently cyclical and sensitive to changes in supply and demand that are, in turn, affected by political and economicconditions in Argentina and elsewhere. This cyclicality may decrease our profit margin. In particular: • downturns in general business and economic activity may cause demand for our products to decline, adversely impacting our sales volume; • when demand falls, we may be under competitive pressure to lower our prices to maintain market share, which could diminish our profitmargins; and • if we decide to expand our plants or construct new plants, we may do so based on an estimate of future demand that may never materialize ormay materialize at levels lower than we predicted. Should actual demand fall short of our estimates, we may encounter excess capacity andunderutilization of our assets. Moreover, the prices we are able to obtain for cement depend in large part on prevailing market prices. Cement is subject to price fluctuationsresulting from production capacity, inventories, the availability of substitutes and other factors relating to the market such as the level of activity in residentialconstruction markets, and, in some cases, government intervention. If the price of cement were to decline significantly from current levels, it could have amaterial adverse effect on us and our profit margin. 13
Page 23
Table of Contents We are subject to the possible entry of domestic or international competitors into our market, which could decrease our market share and profitability. The cement market in Argentina is competitive and is currently served by four principal groups of companies which together supply substantiallyall of the cement consumed in the country. In the cement industry, the location of a production plant tends to limit the market that a plant can serve becausetransportation costs are high, reducing profit margins. Historically, we have been a relevant player with presence across all regions in the country. However,competition could intensify if other players decide to try to enter our market. We may face increased competition from the other cement manufacturers. Even though the industry has installed capacity surplus, currentcompetitors may decide to increase their installed capacity. We also face the possibility of competition in Argentina from the entry into our market of imported clinker, cement or other materials (such asslag) or products from foreign manufacturers, which may have significantly greater financial resources than us. The enactment of recent regulations inconnection with the import of cement may increase the existence of potential foreign competitors in our market. We may not be able to maintain our market share if we cannot match our competitor’s prices or keep pace with the development of new products.If any of these events were to occur, our business, financial condition and results of operations could be adversely affected. A reduction in private or public construction projects in Argentina could have an adverse effect on our business, financial condition and results ofoperations. Cement consumption is highly correlated to construction levels. Demand for our cement products depends, in large part, on residential andcommercial construction and infrastructure developments. Residential and commercial construction, in turn, is cyclical and highly correlated to prevailingmacroeconomic factors, including general economic conditions, changes in interest rates, demographic and population shifts, levels of infrastructure spending,and other factors beyond our control. As a result, decline in economic conditions would reduce household disposable income, reduce residential constructionand potentially delay infrastructure projects, which would lead to a decrease in demand for cement. As a result, a deterioration in the economic conditionswould have a material adverse effect on our financial performance. We cannot assure you that Argentina’s GDP will grow or that the share of Argentina’s GDPdedicated to construction and the infrastructure sectors, will maintain current levels or increase. Significant interruptions or delays in, or the termination of, private or public construction projects may adversely affect our business, financialcondition and results of operations. Private and public construction levels in our market depend on investments in the region which, in turn, are affected byeconomic conditions. In this regard, within the measures taken by Javier Milei’s administration aimed to eliminate Argentina’s deficit, the National Government decidedto stop financing public works. According to the monthly report of the Portland Cement Manufacturers Association, in the first quarter of 2024, dispatchesdecreased by 29.6% compared to the same period of the previous year. In the second quarter of 2024, they decreased by 32%, in the third quarter of 2024, by19.9%, and in the fourth quarter of 2024 by 14.1%. During the first quarter of 2025 cement dispatches increased approximately by 11% compared to the sameperiod of 2024. According to INDEC, the surface authorized by building permits increased by 12.5% in December 2024 compared to the same month in 2023,and formal employment on the sector decreased by 9.8%. If the downturn in the sector continues, the company could be adversely affected in its business, finances and daily operations. Changes in the cost or availability of raw materials supplied by third parties may adversely affect our business, financial condition and results ofoperations. We use certain raw materials in the production of cement, such as gypsum, slag, iron ore, steel slabs, clay, sand and pozzolana that we obtain fromthird parties. Our cost of raw materials supplied by third parties as a percentage of our total cost of sales was 19%, 18% and 15% in 2024, 2023 and 2022,respectively. Should existing suppliers cease operations or reduce or eliminate production of these by-products, sourcing costs for these materials could increasesignificantly or require us to find alternative sources for these materials, which could have a material adverse effect on our business, financial condition, resultsof operations and prospects. 14
Page 24
Table of Contents Energy accounts for a significant portion of our total cost of sales, and higher energy prices or governmental regulations that restrict energy available forour operation could materially adversely affect our operations and financial condition. We consume substantial amounts of energy in our cement production processes and currently rely on third-party suppliers for a significant portionof our total energy needs. During the year ended December 31, 2024, thermal energy cost and electricity cost represented approximately 13% and 8% of ourtotal cost of sales, respectively, and in 2023 and 2022, thermal energy cost and electricity cost represented approximately 16% and 8% and 16% and 9% of ourtotal cost of sales, respectively. Our results of operations may be adversely affected by higher costs of electricity or unavailability or shortages of electricity, oran interruption in energy supplies. For more information, see "Item 5.A. Operating and Financial Review and Prospects - Operating Results." Electricity shortages have occurred in Argentina in the past and could occur again in the future, and there can be no assurance that powergeneration capacity will grow sufficiently to meet our demand. In recent years, the condition of the Argentine electricity market has provided little incentive togenerators to further invest in increasing their generation capacity, which would require material long-term financial commitments. As a result, Argentineelectricity generators are currently operating at near full capacity and could be required to ration supply in order to meet a national energy demand that exceedsthe current generation capacity. In addition, the 2001 economic crisis and the resulting emergency measures had a material adverse effect on other energy sectors, including oiland gas companies, which led to a significant reduction in natural gas supplies to generation companies that use this commodity in their generation activities. Inan attempt to address this situation, in January 2016, the Argentine Government unified and increased wholesale energy prices for all consumption in Argentina. As a result of this and other measures implemented by the Argentine government, investments have been made in conventional and renewableenergy, moderately increasing the installed capacity during the last years. This increase in capacity has occurred both in thermal and renewable energy (windand solar), the latter being enhanced by the renewable energy tenders, reaching 13% of the Argentine generation matrix in 2021. The demand supplied byrenewable energies increased to 13.9% in 2022, to 14.3% in 2023 and to 16.3% in 2024. In this way, the renewable energies sector continues to advancetowards the goal of reaching 20% electricity supply from renewable sources by 2025, as established by Law No. 27,191. In 2024, three new renewable energyprojects started operating, incorporating 216 MW into Argentina's electrical system. As a result, Argentina now has 225 operational renewable energy projects,contributing a total of 6,206 MW to the energy matrix. On December 18, 2023, the Executive Branch published the Decree of Necessity and Urgency 55/2023 (DNU 55) in the Official Gazette,declaring that the national energy sector would be in a state of emergency – with regard to the generation, transportation and distribution of electric powerunder federal jurisdiction and the transportation and distribution of natural gas – until December, 31, 2024. Later, through Decree No. 1023/2024 the emergencyof the national energy sector was extended until July 9, 2025. Among other matters, DNU 55 launched a tariff review process for electric power and natural gas services that are subject to federal jurisdiction.In this regard, it should be noted that the tariff schedule resulting from the tariff review for the transportation and distribution of natural gas, will be enforceduntil July 9, 2025. As part of the tariff review, public hearings were held in February 2025. Regarding energy prices, it should be noted that substantial increases were applied for residential and industrial users in 2024 due to withdrawal ofenergy subsidies and the adjustment of the distribution value, and further increases are expected in 2025. Additionally, the ongoing construction of the secondstage for the Gasoducto Néstor Kirchner (Néstor Kirchner Gas Pipeline) could alter the current status of the Argentine energy industry, particularly affecting theenergy prices in ways that we are currently unable to predict. Electricity generators may still not be able to guarantee the supply of electricity to distribution companies, which, in turn, could prevent thesecompanies from experiencing continued growth in their businesses and could lead to failures to provide electricity to customers; and we may not have access tothe gas necessary to maintain our cement production processes. Shortages and government efforts to respond to or prevent shortages may materially adverselyimpact the cost and supply of energy for our operations, which could materially adversely affect our operations and financial condition. 15
Page 25
Table of Contents Moreover, all of the locomotives we operate for our railroad segment are diesel-powered, and our fuel expenses are significant. If increases in fuelprices cannot be passed on to our customers through our tariffs, our operating margins could be materially and adversely affected. Fuel prices have historicallybeen volatile and may continue to be volatile in the future. Fuel prices are subject to a variety of factors that are beyond our control, including, but not limitedto, consumer demand for, and the supply of, oil, processing, gathering and transportation availability, price and availability of alternative fuel sources, weatherconditions, natural disasters and political conditions. Public health threats or outbreaks of communicable diseases have had and may have an adverse effect on our operations and financial results We cannot ensure that there may not be any future public health threats and/or outbreaks of communicable diseases. In this sense, we are unable to estimate theeconomic and financial impact for our business, or the possibility of other economic effects on the stock market, foreign exchange rates and otherwise. Anysuch negative impact could result in a material adverse effect on our business, liquidity, financial conditions and results of operations as well as our ability toachieve our previously disclosed expectations for future years. We may be materially adversely affected if our transportation, storage and distribution operations are interrupted or are more costly than anticipated. Our operations are dependent upon the uninterrupted operation of transportation, storage and distribution of our cement products. Transportation,storage or distribution of our cement products could be partially or completely shut down, temporarily or permanently, as the result of any number ofcircumstances that are not within our control, such as: • disasters or catastrophic events; • extreme weather conditions; • hostilities or political uncertainty; • strikes or other labor difficulties; • acts of terrorism; • widespread illnesses or epidemics; • other disruptions in means of transportation; • higher logistics costs due to lack of availability of means of transport, greater bargaining power of logistics providers and/or significantincreases in the cost of labor; and • potential impacts of the termination of the railway concession granted to Ferrosur Roca S.A. or of the eventual terms and conditionsestablished for its continuation as a railway operator in the new operational modality that the National Government could implement. Pleasesee “Item 3.D The early termination of our railway concession may have a material adverse effect on our business". In addition, we rely on third-party services providers for the transportation of our products to our customers. Our ability to service our customersat reasonable costs depends, in many cases, upon our ability to negotiate reasonable terms with carriers, including trucking companies. To the extent that third-party carriers were to increase their rates, we may be forced to pay these higher rates before we are able to pass such increases onto our customers, if at all. Any significant interruption at these facilities or an inability to transport our products to or from these facilities or to or from our customers forany reason would materially adversely affect us. Our business strategies require substantial capital and long-term investments, which we may be unable to fund competitively. To continue expanding our cement production capacity and distribution network, our business strategies require substantial capital investments,which we may finance through additional debt and/or equity financing. However, adequate financing may not be available or, if available, may not be availableon satisfactory terms, including as a result of adverse macroeconomic conditions. We may be unable to obtain sufficient additional capital in the future to fundour capital requirements and our business strategy at acceptable costs. If we are unable to access additional capital on terms that are acceptable to us, we maynot be able to fully implement our business strategy, which may limit the future growth 16
Page 26
Table of Contents and development of our business. If our need for capital were to arise due to operating losses, these losses may make it more difficult for us to raise additionalcapital to fund our expansion projects. The implementation of our growth strategies depends on certain factors that are beyond our control, including changes in the conditions of themarkets in which we operate, actions taken by our competitors and laws and regulations in force in Argentina. The Company's results of operations andfinancial condition could be adversely affected by unfavorable economic conditions and the Company's eventual inability to access financing to fund itsoperations in the future. Our failure to successfully implement any part of our strategy may have a material adverse impact on us. Management’s plans to obtain sufficient funds to settle current liabilities may not be accomplished and hence we may have negative working capital in thenear future. Our board of directors has the ultimate responsibility for liquidity risk management and has established an appropriate framework allowing ourmanagement to handle financing requirements for the short-, medium- and long-term. Weaker economic conditions could adversely affect our business, results of operations and financial condition. In addition, if we are unable toaccess the capital markets to finance our operations in the future, this could adversely affect our ability to obtain additional capital to grow our business. We are subject to risks related to litigation and administrative proceedings that could adversely affect our business and financial performance in the eventof an unfavorable ruling. The nature of our business exposes us to litigation relating to product liability claims, labor, health and safety matters, environmental matters,regulatory, tax and administrative proceedings, governmental investigations, tort claims and contract disputes, among other matters. We have been and aresubject to antitrust and tax proceedings or investigations including by the Argentine Antitrust Commission, or the CNDC (see “Item 8. Financial Information—Legal Proceedings—Antitrust Proceedings”). Litigation is inherently costly and unpredictable, making it difficult to accurately estimate the outcome of actualor potential litigation. Although we establish provisions as we deem necessary, the amounts that we reserve could vary significantly from any amounts weactually pay due to the inherent uncertainties in the estimation process. We cannot assure you that these or other legal proceedings will not materially affect ourability to conduct our business, financial condition and results of operations in the event of an unfavorable ruling. For instance, in 2018, two investors who claimed to have purchased our ADSs pursuant and/or traceable to our initial public offering, or IPO,commenced two different putative class actions before US courts on behalf of all persons and/or entities who purchased or otherwise acquired our ADSspursuant and/or traceable to our prospectus and registration statement issued in connection with the IPO and, in the case of the Federal Class Action (definedbelow), on behalf of all persons and/or entities who purchased our ADSs on the open market between November 2, 2017 and May 23, 2018, inclusive. LomaNegra, its directors and some members of its senior management at the time of the IPO and Loma Negra Holding GmbH (now InterCement Trading eInversiones S.A.) were named as defendants in both actions. The Federal Class Action was dismissed in 2020, and the dismissal is now final. The State ClassAction was resolved through a settlement that was granted preliminary approval by the New York State Court on November 30, 2023, with final approvalfollowing on April 10, 2024. The court issued a final judgment on March 3, 2025, and the appeal period expired on April 2, 2025, with no appeals filed. Thesettlement did not include any admission of liability or wrongful conduct by us or the other defendants in the class action, and included a release of all claims.See “Item 8.A. Consolidated Statements and Other Financial Information—Legal Proceedings—Securities Complaints Commenced Against Loma Negra underUS Jurisdiction.” We are subject to anti-corruption, anti-bribery, anti-money laundering and antitrust laws and regulations in Argentina and regulations in the United Statesand our internal policies and procedures might not be sufficient to ensure compliance with such laws and regulations. The United States Foreign Corrupt Practices Act (FCPA), the Argentine Anti-Money Laundering Law (Ley de Prevención del Lavado de Activos),the Argentine Corporate Criminal Liability Law (Ley de Responsabilidad Penal Empresaria) and other applicable anti-corruption laws prohibit companies andtheir intermediaries from offering or making improper payments (or giving anything of value) to government officials and/or persons in the private sector forthe purpose of influencing them or obtaining or retaining business and require companies to keep accurate books and records and maintain appropriate internalcontrols. In particular, the Argentine Corporate Criminal Liability Law provides for the criminal liability of corporate entities for criminal offenses againstpublic administration and transnational bribery committed by, among others, its attorneys-in-fact, directors, managers, employees, or representatives. In thissense, a 17
Page 27
Table of Contents company may be held liable and subject to fines and/or suspension of its activities if such offenses were committed, directly or indirectly, in its name, behalf orinterest, the company obtained or may have obtained a benefit therefrom, and the offense resulted from a company’s ineffective control. Although we have a Compliance Program with internal policies and procedures designed to ensure compliance with applicable laws andregulations, potential violations of anti-corruption laws could be identified on occasion as part of our compliance and internal control processes. In case suchissues arise, we plan to attempt to act promptly to learn relevant facts and take any appropriate remedial action to address the risk. Given the size of ouroperations and the complexity of the production chain, there can be no assurance that our internal policies and procedures will be sufficient to prevent or detectall inappropriate practices, fraud or violations of law by our employees, directors, officers, partners, agents and service providers or that such persons will nottake actions in violation of our policies and procedures (or otherwise in violation of the relevant anti-corruption laws and sanctions regulations) for which we orthey may be ultimately held responsible. If we or individuals or entities that are or were related to us are found to be liable for violations of applicable anti-corruption laws (either due toour own acts or our inadvertence, or due to the acts or inadvertence of others), we or other individuals or entities could face civil and criminal penalties or othersanctions, which in turn could have a material adverse impact on our reputation and business. Further, litigation or investigations relating to alleged orsuspected violations of anti-corruption laws and sanctions regulations could be costly. We are also subject to antitrust laws in Argentina. Climate change and climate change legislation or regulations may adversely affect our business. The risks that climate change poses through environmental changes and acute, weather-related events continues to attract considerable public andscientific attention in the EU, the United States and other parts of the world. A number of governmental bodies have finalized, proposed, or are contemplatinglegislative and regulatory changes in response to the potential effects of climate change. For instance, on March 6, 2024, the SEC adopted final rules to requireregistrants to include extensive climate-related disclosures in registration statements and annual reports. Among other things, the SEC rules mandate disclosureson (i) Climate related risks that are reasonably likely to have a material effect on our business strategy, results of operations or financial condition; (ii) the actualand potential material impacts of identified climate-related risks on our business; (iii) any activities we have undertaken to mitigate or adapt to material climate-related risks; (iv) the extent of oversight and governance by our board of directors over climate-related risks and the role of management in assessing andmanaging these risks; (v) our processes for identifying, assessing, and managing material climate-related risks; and (vi) a qualitative description of how ourfinancial statement estimates and assumptions have been materially influenced by climate-related risks and uncertainties, severe weather events, or disclosedclimate-related targets or transition plans. On April 4, 2024 the SEC voluntarily stayed its climate-related disclosure rules pending completion of the EighthCircuit Court of Appeal’s review of the rules, the SEC will “continue vigorously defending” the rules in court. However, on March 27, 2025, the SEC voted toend its legal defense of the climate disclosure rules, ending its previous legal posture. Although this action does not formally repeal the rules, it subjects them tothe Eighth Circuit Court of Appeal's final decision. The adoption of these or similar rules in the future may necessitate significant changes in our reporting andoperational practices, possibly leading to increased compliance costs and impacting our financial statements. The cement manufacturing process requires the combustion of large amounts of fuel and creates carbon dioxide as a by-product of the calcinationprocess. Therefore, efforts to address climate change through federal, state, regional, EU and international laws and regulations requiring reductions ingreenhouse gases (GHGs) can create economic risks and uncertainties for our business. Such risks could include the cost of purchasing allowances, emissionsoffsets or credits to meet GHG emission caps, the cost of installing equipment to reduce emissions to comply with GHG limits or required technologicalstandards, decreased profits or losses arising from decreased demand for our goods and higher production costs resulting directly or indirectly from theimposition of legislative or regulatory controls. To the extent that financial markets view climate change and GHG emissions as a financial risk, this could havea material adverse effect on our cost of and access to capital. Given the uncertain nature of the actual or potential statutory and regulatory requirements forGHG emissions at the federal, state, regional, EU and international levels, we cannot predict the impact on our operations or financial condition or make areasonable estimate of the potential costs to us that may result from such requirements. However, the impact of any such requirements, whether individually orcumulatively, could have a material economic impact on our operations. Climate change legislation and regulation concerning GHGs if implemented could have a material adverse effect on our financial condition,results of operations and liquidity. Climate change legislation and regulation may also 18
Page 28
Table of Contents adversely affect energy and electricity costs. There are ongoing international efforts to address GHG emissions. The United Nations and certain internationalorganizations have taken action against activities that may increase the atmospheric concentration of GHGs. Such measures may result in increased costs to usfor installation of new controls aimed at reducing GHG emissions, imposition of carbon taxes, purchase of credits or licenses for atmospheric emissions, andmonitoring and registration of GHG emissions from our operations. These measures, if adopted in Argentina, could adversely affect our business, financialcondition and results of operations. Changes in the investing and financing markets with respect to issuers with significant GHG emissions could also have suchadverse effects. Climate change may include physical effects that may adversely affect our operations, such as disruption in production and supply chaindistribution as a result of major storm events and shifts in regional weather patterns and intensities. Production and shipment levels for our businesses correlatewith general construction activity, most of which occurs outdoors and, as a result, is affected by erratic weather patterns, seasonal changes, and other unusual orunexpected weather-related conditions, which can significantly affect our businesses. Environmental, health and safety regulation may adversely affect our business. The pollutants generated by cement producers are mainly dust and gas emissions from the use of fossil fuels. Our operations often involve the use,handling, disposal and discharge of hazardous materials into the environment and the use of natural resources. Most of our operations are subject to extensiveenvironmental, health and safety regulations. In Argentina, regulations regarding gas emissions and air quality are enacted at both the national and provincial levels. We are required to obtainpermits and licenses from governmental authorities for many aspects of our operations, and we may be required to purchase and install expensive pollutioncontrol equipment or to make operational changes to limit the actual or potential environmental, health and safety impacts of our operations to the environmentand our employees. The Province of Buenos Aires, where our principal plants are located, requires that all production facilities have an environmentalcompliance certificate issued by the Ministry of Environment (former Provincial Organism for Sustainable Development), and similar certifications orapprovals are required by relevant municipal or provincial authorities in the other jurisdictions in which we operate. As part of these requirements, localenvironmental authorities ordinarily make information requests to each of our plants relating to their compliance with environmental laws and regulations and,in the ordinary course of our business, we collaborate with such national and provincial environmental authorities in the conduct of their regulatory activities. We could be subject to administrative and criminal sanctions, including warnings, fines and closure orders for our failure to comply with theseenvironmental regulations, which, among other things, limit or prohibit emissions or spills of toxic substances that we emit in connection with our operations.We also may be required to modify or retrofit our facilities at substantial cost in order to comply with waste disposal and emissions regulations. We are subjectto inspection by environmental agencies in the various jurisdictions that we operate, which may impose fines, restrictions on our operations or other sanctions.In addition, we are subject to environmental laws that may require us to incur significant costs to mitigate any damage that a project may cause to theenvironment, which costs may adversely impact the viability or projected profitability of the projects that we intend to implement. Moreover, any damagecaused to the environment may oblige our company to pay compensation for damages. In addition, as a result of possible changes to environmental regulations, the amount and timing of our future environmental complianceexpenditures may vary substantially from those we currently anticipate. Certain environmental laws impose liability on us for any and all consequences arisingout of exposure to hazardous substances or the generation of environmental damage. Additionally, the Marrakesh Agreement established by the World Trade Organization (WTO), the Agreement on Technical Barriers to Trade, thatrecognizes that no country should be prevented from adopting measures necessary to ensure the quality of its exports, national security, protection of humanand animal health, environmental protection, preservation of plants, and prevention of misleading practices. In this sense, The International Federation ofBuilding and Wood Workers (IFBWW) - which brings together trade unions from the construction, wood, forestry, and related sectors - has developed a globalcampaign under the slogan "No more than 25Kg," basing it on the negative impact of manually carrying loads heavier than that weight on workers' health.Convention No. 127 of the International Labour Organization (ILO) contains provisions regarding the maximum weight of loads carried by a worker. Theseinitiatives were locally reflected by the Resolution 54/2018 of the Secretary of Commerce. 19
Page 29
Table of Contents We cannot assure you that the costs we incur to comply with existing current and future environmental, health and safety laws, and liabilities thatwe may incur from past or future releases of, or exposure to, hazardous substances will not materially and adversely affect us. Compliance with Resolution 54/2018 of the Secretary of Commerce could adversely affect our operations and profitability. Pursuant to Resolutions 54/2018 of the Secretary of Commerce (former Ministry of Production) and Labor Law — which establishes the technicalquality and safety requirements for all types and classes of cements used in construction — cement sold in bags must have a maximum net content of 25kilograms. Therefore, our cement bags must be reduced from 50 kilograms to 25 kilograms. While the original enforcement date was October 3, 2022, the maincement companies through the AFCP requested an extension of the effective date and worked with the administrative authorities regarding the implementationof this new regulation as well as a potential timeline. As a result, through Resolution 22/2022, the Secretary of Commerce provided that the obligation tocomply with Resolution 54/2018 would be postponed to October 3, 2023. On April 24, 2024, the Secretary of Commerce by means of Resolution 11/2024decided to suspend item 1.4 of Annex II of Resolution 54/2018 until July 1, 2025. Therefore the cement bags reduction will be enforceable as of such date. Due to the lack of specific regulations it is uncertain how the commercialization of the available stock of 50 kilogram cement bags will bemanaged after July 1, 2025, and therefore any failure to directly or indirectly comply with Resolution 54/2018 could potentially adversely affect our business. This implementation could adversely impact our results of operation and financial position. Compliance with mining regulations or the revocation of our authorizations, licenses and concessions could adversely affect our operations andprofitability. We engage in certain mining operations as part of our cement production processes. These activities depend on authorizations and concessionsgranted by the Argentine governmental authorities or regulatory agencies. The extraction, mining and mineral processing activities are also subject to applicablelaws and regulations, which change from time to time. Although we believe that we are in substantial compliance with applicable laws relating to theseactivities as well as the terms of our current authorizations and concessions, the effect of any future applicable regulatory changes regarding such matters on ourmining activities or mining rights cannot presently be determined. In addition, if our authorizations and licenses are revoked, we may be unable to maintain orimprove our cement production levels, which could adversely impact our results of operation and financial condition. Governmental agencies or other authorities may adopt new laws or regulations that are more stringent than existing laws or regulations or mayseek to more stringently interpret or enforce existing laws and regulations that would require us to expend additional funds on environmental or other regulatorycompliance or delay or limit our ability to operate as we intend. In addition, these actions could increase the costs associated with the renewal of our existinglicenses and permits or the cost of seeking new licenses or permits. We cannot assure you that these additional costs will not be material or that our existingpermits will be renewed. Our railway concession operates in a regulated environment, and measures taken by public authorities may impact our activities. Our transportation operation take place in a regulated environment. The Argentine federal government has the legal authority to regulate railactivities in the country (by means of the enactment of applicable laws and regulations). Therefore, actions taken by the public administration in general mayaffect the services rendered by us. Law No. 27,132 in effect since May 20, 2015, provides for important changes in the regulatory framework of the railway system and empoweredArgentina’s federal government to renegotiate and, if necessary, terminate concessions currently in force. Pursuant to Decree No. 158/2021, published on March 12, 2021, the National Government imposed an update mechanism pursuant to whichFerrosur would have to substantially increase the amount of the performance guarantee it had originally posted according to the concession contract (andupdated in 2018 voluntarily). Ferrosur has filed an administrative appeal against such Decree before the Argentine Executive Branch not only because theupdate is considered unreasonable but also because the National Government does not have the right to unilaterally modify the 20
Page 30
Table of Contents concession contract. On November 24, 2023, through Decree No. 601/2023 the appeal filed by Ferrosur was rejected by the previous administration. OnJanuary 2, 2024 Ferrosur filed a new appeal against such decree. As of the date of this annual report, the appeal has not been resolved. We cannot be certain of the effects on the terms of our concession or any changes to the current regulatory framework that the competentauthorities of the federal government may issue and whether these changes will adversely affect our results of operations. The early termination of our railway concession may have a material adverse effect on our business. Argentina’s railway concessions are subject to early termination in certain circumstances, including the competent authorities’ decision to regaincontrol of the service or to terminate the concession for breach of contract. Upon termination of a concession, the leased or operated assets must revert to thefederal government. The amount of compensation may not be sufficient to cover all the losses suffered by us as a result of such early termination. In addition,certain creditors may have priority with regard to such compensation. Likewise, upon termination, the competent authority may claim compensation alleging apurported breach of the concession contract. In addition, Law No. 27,132 (passed in April 2015), inter alia, established that the Argentine Executive Branch must adopt all necessary measuresto recover the administration of railway infrastructure, provide for open access to the freight railroad transportation system and empowers the Ministry ofTransport to terminate and renegotiate railway concession contracts. It also provided for the creation of a National Registry of Railroad Operators, which wasestablished by Decree No. 1924/15, within the purview of the National Commission of Transport Regulation (CNRT). The full implementation of the openaccess scheme entails the re-assumption by the Government of the administration of the railways infrastructure and, once in effect, would represent a significantchange to the Argentine railway system. This regulatory change may benefit those sectors which are interested in operating railways in Argentina, as well asthose that wish to transport commodities and other products through them. In November 2018, Decree No. 1027/2018 amended several provisions of Law No. 27,132, allowing for the renegotiation of railway concessioncontracts and the possibility of extending terms by up to ten years, and regulates concessionaire investments. The decree stipulates that the open-access schemewill be fully implemented once current railway concession agreements, including any extensions, have expired. On March 8, 2018, Ferrosur Roca applied for a ten-year extension to its concession. By March 20, 2019, the Ministry of Transport indicated that aSpecial Commission, as established by Decree No. 1027/2018, would oversee the renegotiation process, including analyzing the extension request to facilitatethe open-access scheme. Resolution No. 1112/18 appointed new Commission members by late 2018, but changes in membership delayed progress. Ferrosur Roca made itsextension request conditional on renegotiation of concession terms, to address business impacts. On November 3, 2020, Ministry of Transport Resolution No. 248/2020 removed the Lobos-Bolívar branch from Ferrosur Roca's concessionscope. Ferrosur ratified its representatives and requested negotiation resumption, highlighting its commitment to progression despite setbacks. Resolution No. 219/2021, issued on March 29, 2021, established CNRT rules for the National Registry of Railroad Operators, granting operationalcapacity to Ferrosur and other concessionaires. Upon open access implementation, registered operators will provide services irrespective of facility ownership.Registrants must fulfill specific service requirements, adhere to CNRT regulations and laws, and pay fees. Obligations include notifying CNRT of corporatechanges and submitting annual financial statements. Performance compliance is monitored through annual CNRT reports. In accordance with Resolution No. 211/2021, published in the Official Gazette on June 28, 2021, the Ministry of Transport rejected the extensionof the term of the concession requested by different companies such as Ferrosur Roca. In that sense, Ferrosur Roca’s concession was due to expire in March2023. Later on, the CNRT approved the registration of Ferrosur Roca as “Railway Operator” in the National Register of Railway Operators (ReNOF, as per itsacronym in Spanish) by the enactment of Disposition No. 122/2022, published in the Official Gazette on February 25, 2022. 21
Page 31
Table of Contents On December 28, 2022, the Argentine Ministry of Transport issued Resolution No. 960/2022, extending the term of the concession by 18 monthsas of March 10, 2023, until September, 2024. Such term was again extended by the Ministry of Economy on October, 2024 by means of Resolution No.991/2024 until September 10, 2025. However, such extension may be revoked at any time, with or without cause, and Ferrosur Roca will not be entitled to receive or claim anycompensation if the decision to revoke the concession is taken before September 2025. On February 11, 2025, the Ministry of Economy, through Resolution 99/2025, ordered the removal of part of Branch 38, from Kilo Cinco to Sola“A” Station, from the concession granted to Ferrosur Roca S.A. As a result, the railway infrastructure for this section was transferred to Administración deInfraestructuras Ferroviarias (ADIF), a national public sector company operating within the Secretariat of Transportation of the Ministry of Economy. Thisremoval could adversely affect our concrete operations at the Sola plant. In addition, on February 10, 2025, the Argentine Executive Branch issued Decree 67/2025 authorizing the total privatization of Belgrano Cargas yLogística S.A., through the vertical disintegration and separation of the activities and assets of each of its business units through the celebration of public worksconcession contracts for the railway tracks and workshops, together with their adjacent properties, and the sale of the rolling stock through a public auction.Although this decree does not directly affect our concession, it demonstrates the Argentine government’s willingness to implement significant changes torailway infrastructure policies and concession frameworks. As of the date of this annual report, we cannot guarantee that the Argentine authorities will not terminate our railway concessions prior to thestated terms or that they will extend the term of the railway concession upon the current expiration fixed on September 2025. Furthermore, we cannot guaranteethat the Argentine authorities will actually implement the open access scheme nor the mechanism and terms in which the rolling stock will be leased. Any suchaction by the Argentine authorities could have a material adverse effect on our business, financial condition and results of operations. For additional information related to Ferrosur Roca’s railway concession, See “Item 4.B Information on the Company—Business Overview—Ferrosur Roca”. Our estimates of the volume and grade of our limestone deposits could be overstated, and we may not be able to replenish our reserves. Our limestone reserves described in this annual report constitute our estimates based on evaluation methods generally used in our industry and onassumptions as to our production. Our proven and probable reserve estimates are based on estimated recoverable tons. A “qualified person” (as defined inRegulation S-K 1300) employed by us reviewed our limestone reserves for 2024, confirming no material changes necessitating updates in our annual filing, asdefined by Regulation S-K 1300. We did not employ independent third-parties to review reserves over the five-year period ended December 31, 2024. Ourmineral reserves data are prepared by our engineers and geologists and are subject to further review by our corporate staff. Moreover, there are numerous uncertainties inherent in estimating quantities of reserves and in projecting potential future rates of mineralproduction, including many factors beyond our control. The calculations of mineral reserves are estimates and depend upon geological interpretation andstatistical inferences or assumption drawn from drilling and sampling analyses. Reserve engineering involves estimating deposits of minerals that cannot bemeasured precisely, and the accuracy of any reserve estimate is a function of the quality of available data, as well as engineering and geological interpretationand judgment. These estimates are also subject to uncertainty due to factors that include the inherent variability of the deposit and recoverability of useablematerial in the mining process. As a result, we cannot assure investors that our limestone reserves will be recovered or that they will be recovered at the rateswe anticipate. We may be required to revise our reserve and mine life estimates based on our actual production and other factors. These estimates andassumption could change significantly in the future and could adversely affect our financial position, results of operations or cash flows. If our limestonereserves are lower than our estimates, this may have a material adverse effect on us, particularly if as a result we have to purchase limestone from third-partysuppliers, and it could also adversely affect the value of your investment in our securities or subject us to liability under U.S. federal securities laws in the formof SEC enforcement actions or private lawsuits. 22
Page 32
Table of Contents Our business is subject to a number of operational risks, which may adversely affect our business, financial condition and results of operations. Our cement business is subject to several industry-specific operational risks, including accidents, natural disasters, labor disputes and equipmentfailures. Such occurrences could result in damage to our production facilities, and equipment and/or the injury or death of our employees and others involved inour production process. Moreover, such accidents or failures could lead to environmental damage, loss of resources or intermediate goods, delays or theinterruption of production activities and monetary losses, as well as damage to our reputation. Any prolonged and/or significant disruption to our productionfacilities, whether due to repair, maintenance or servicing, governmental or administrative actions, regulatory issues, civil unrest, industrial accidents,unavailability of raw materials such as energy, mechanical equipment failure, human error, natural disasters, cyberattacks to our systems, public health threat orotherwise, could disrupt and adversely affect our operations. Additionally, any major or sustained disruptions in the supply of utilities such as water or electricity or any fire, flood or other natural calamitiesor communal unrest or acts of terrorism or disease outbreaks may disrupt our operations or damage our production facilities or inventories and could adverselyaffect our business, financial condition and results of operations. Our insurance may not be sufficient to cover losses from these events, which could adverselyaffect our business, financial condition and results of operations. Our rail transportation and handling of cargo also exposes us to risks of catastrophes, mechanical and electrical failures, collisions and loss ofassets. Fires, explosions, fuel leaks and other flammable products as well as other environmental events, cargo loss or damage, railroad, cargo loading andunloading terminal, accidents, business interruptions due to political events as well as labor claims, strikes, adverse weather conditions and natural disasters,such as floods, may result in the loss of revenues, assumption of liabilities or cost increases. Moreover, our operations may be periodically affected bylandslides and other natural disasters. We typically shut down our facilities to undertake maintenance and repair work at scheduled intervals. Although we schedule shutdowns such thatnot all of our facilities are shut down at the same time, the unexpected shut down of any facility may nevertheless affect our business, financial condition andresults of operations from one period to another. In addition, key equipment at our facilities, such as our mills and kilns, may deteriorate sooner than wecurrently estimate. Such deterioration of our assets may result in additional maintenance or capital expenditures, and could cause delays or the interruption ofour production activities. If these assets do not generate the cash flows we expect, and we are not able to procure replacement assets in an economically feasiblemanner, our business, financial condition and results of operations may be materially and adversely affected. Our insurance coverage may not cover all the risks to which we may be exposed. We face the risks of loss and damage to our products, property and machinery due to fire, theft and natural disasters such as floods. Such eventsmay cause a disruption to or cessation of our operations. Our insurance may not be sufficient to cover losses from these events, which could adversely affectour business, financial condition and results of operations. We also face risks related to cybersecurity threats, however, as of December 31, 2024, our insurancedoes not cover losses associated with cybersecurity risks. If our losses exceed our insurance coverage, or if we are not covered by our insurance policies, wemay be liable for any shortfalls or losses. Our insurance premiums may also increase substantially because of such claims. Such circumstances could have amaterial adverse effect on our business, liquidity, financial condition and results of operations. Our success depends on key members of our management. Our success depends largely on the efforts and strategic vision of our executive management team and board of directors. The loss of the servicesof some or all of our executive management or members of our board of directors could have a material adverse effect on our business, financial condition andresults of operations. The execution of our ongoing business plan also depends on our ongoing ability to attract and retain additional qualified employees. For a varietyof reasons, particularly with respect to the competitive environment and the availability of skilled labor, we may not be successful in attracting and retaining thepersonnel we require. If we are unable to hire, train and retain qualified employees at a reasonable cost, we may be unable to successfully operate our businessor capitalize on growth opportunities and, as a result, our business, financial condition and results of operations could be adversely affected. 23
Page 33
Table of Contents The introduction of substitutes for cement in the markets in which we operate and the development of new construction techniques could have a materialadverse effect on us. Materials such as plastic, aluminum, ceramics, glass, wood and steel can be used in construction to substitute cement. In addition, otherconstruction techniques, such as the use of dry wall, and the integration of new technologies in the construction industry, such as 3-D printing, mini-mills andmobile plants, and changes in housing preferences could decrease the demand for cement and concrete. In addition, research aimed at developing newconstruction techniques and modern materials and digitalizing the construction industry may be introduced in the future that could reduce the demand for andprices of our products. The use of substitutes for cement such as recycled concrete and asphalt which are increasingly being used in a number of our markets,particularly urban markets, could cause a significant decrease in the demand and prices for our cement products and have a material adverse effect on ourbusiness, financial condition, liquidity and results of operations. We are subject to restrictions due to our non-controlling interests in certain of our consolidated subsidiaries. We conduct some of our business through subsidiaries. In some cases, other shareholders hold non-controlling interests in these subsidiaries. Non-controlling shareholders’ interests may not always be aligned with our interests and, among other things, could result in our inability to implementorganizational efficiencies and transfer cash and assets from one subsidiary to another in order to allocate assets most effectively. Changes in labor laws and in case law interpretations of labor laws in Argentina that tend to favor employees could negatively affect our results ofoperations. In December 2023, the Argentine Executive Branch issued the Urgent and Necessary Decree No. 70/2023 (“DNU”, for its acronym in Spanish) bywhich significant changes to labor regulations were made (eliminating fines for lack of registration of employment, flexible regulations for employees, contractors, and outsourcing models, among others). However, the two union confederations in Argentina (the General Confederation of Labor -“CGT”- andArgentine Workers’ Central Union -“CTA”-, entities to which all trade unions are associated) presented a challenging against the DNU before the National Labor Courts. The resolution by the National Supreme Court is pending. Thus, labor chapter of the DNU is still suspended. However, the Bases Law incorporated some of the changes introduced by the DNU (such as the elimination of the very expensive labor fines forlack or deficient registration of employment) in addition to other new modifications. The changes instituted by the Bases Law aim to make it easier for privatesector employers to hire and manage their workforce so it should not negatively affect our results of operations. Among others, the changes introduced by the Bases Law aim to reduce the contingencies, and economic exposure related to labor claims ingeneral, and to those made by third-party employees, in particular. Risks may not be ruled out because the Bases Law is very recent and the courts’ reactionsand approaches is still unknown. In the past, the Argentine government has introduced laws, regulations and decrees requiring private companies to maintain certain minimumwage standards and provide specific benefits to employees. We cannot guarantee that the current Argentine government will not take measures that will increasewages or require us to provide additional benefits that result in an increase in our costs and expenses, but this is not expected to happen Failures in our information technology systems and information security (cybersecurity) systems can adversely impact our operations andreputation. Our operations are to some extent dependent on information technology and automated operating systems to manage or support our operations.The proper functioning of these systems is critical to the efficient operation and management of our business. Our systems may be vulnerable to damage,disruption or intrusion caused by circumstances beyond our control, such as physical or electronic theft, catastrophes, power outages, natural disasters,computer system or network failures, viruses or malware, unauthorized access and cyber-attacks. In addition, these systems may require modifications orupgrades as a result of technological advancements or the growth of our business. We constantly evaluate the risks we face and, as a result, we reinforce our ITinfrastructure by implementing new technologies and solutions to assist in the prevention of potential cyber-attacks, as well as protective measures andcontingency plans in the event of an attack. We have established processes to assess, identify and manage material risks arising from cybersecurity threats,which have been integrated into our comprehensive risk management programs. Our executive management collaborates with our information security team toperiodically reassess our cybersecurity stance and IT-related security risks, as well as 24
Page 34
Table of Contents our ability and plans to mitigate and respond to cybersecurity risks. Although we take measures to protect our systems and electronic information and also havedisaster recovery plans in case of incidents that could cause significant disruptions to our business, these measures may not be sufficient. Loma Negra has developed a Cybersecurity Incident Response Plan that provides a structured and organized framework to effectively andefficiently address cybersecurity incidents by analyzing the potential impact, containment of the attack, eradication of the threat and recovery all while ensuringoperational continuity. We have also developed a Communication Plan to enable information flow among internal and external stakeholders in the event of anincident. Over the past year, we have reinforced our Awareness Plan, focusing on training our employees on cybersecurity risks and threats as well asinstructing them on how to respond to a cybersecurity incident, whether it involves or affects IT resources or the devices used to access Loma Negra's ITsystems. To date, we have not detected, and our external service providers have not informed us of, any relevant event that has materially damaged,interrupted or caused an intrusion in our systems. Any significant data leakage or theft of information could affect our compliance with data privacy laws andharm our relationship with our employees, customers and suppliers, and also adversely impact our business, financial condition and results of operation. As ofDecember 31, 2024, our insurance does not cover any risk associated with any cybersecurity risks. In addition, any significant disruption to our systems couldadversely affect our business, financial condition and results of operations. Risks Relating to Our Ordinary Shares and the ADSs The market price of our ADSs may fluctuate significantly, and you could lose all or part of your investment. Volatility in the market price of our ADSs may prevent you from being able to sell your ADSs at or above the price you paid for them. The marketprice and liquidity of the market for our ADSs may be significantly affected by numerous factors, some of which are beyond our control and may not bedirectly related to our operating performance. The market price of our ADSs increased by 68% and 4% in 2024 and 2023, respectively. The variation in valuemay be affected by the following factors: • actual or anticipated changes in our results of operations, or failure to meet expectations of financial market analysts and investors; • investor perceptions of our prospects or our industry; • operating performance of companies comparable to us • increased competition in our industry; • inflationary trends; • new laws or regulations or new interpretations of laws and regulations applicable to our business; • general economic trends in Argentina; • departures of management and key personnel; • the trading volume of our ADSs; • catastrophic events, such as earthquakes and other natural disasters; • widespread illnesses or epidemics; • developments and perceptions of risks in Argentina and in other countries; and • a change in control, including as a result of the restructuring of our controlling shareholder's financial obligations. Market fluctuations, as well as general political and economic conditions in the markets in which we operate, such as recession or currencyexchange rate fluctuations, may also adversely affect the market price of our ordinary shares and the ADSs. Although our ADSs listed on the New York StockExchange are U.S. dollar-denominated securities, they do not eliminate the currency risk associated with an investment in an Argentine company. Followingperiods of volatility in the market price of a company’s securities, that company may often be subject to securities class-action litigation. This kind of litigationmay result in substantial costs and a diversion of management’s attention and resources, which could have a material adverse effect on our business, results ofoperations and financial condition. 25
Page 35
Table of Contents The relative volatility and illiquidity of the Argentine securities markets may substantially limit your ability to sell shares underlying the ADSs at the priceand time you desire. Investing in securities that trade in emerging markets, such as Argentina, often involves greater risk than investing in securities of issuers in theUnited States. The Argentine securities market is substantially smaller, less liquid, more concentrated and can be more volatile than major securities markets inthe United States and is not as highly regulated or supervised as some of these other markets. There is also significantly greater concentration in the Argentinesecurities market than in major securities markets in the United States. Accordingly, although you are entitled to withdraw the shares underlying the ADSs fromthe ADR facility, your ability to sell such shares at a price and time at which you wish to do so may be substantially limited. Furthermore, new capital controlsimposed by the Argentine Central Bank could have the effect of further impairing the liquidity of the BYMA by making it unattractive for non-Argentines tobuy shares in the secondary market in Argentina. See “Item 10.D Additional Information—Exchange Controls”. Interpretation of Argentine tax laws may adversely affect the tax treatment of our ordinary shares and the ADSs. Argentine income tax law provides that the income resulting from the sale, exchange or other transfer of shares and other securities is subject totax at a rate of 15% for Argentine resident individuals or a sliding scale from 25% to 35%, depending on the accumulated net income obtained during the givenyear, for Argentine companies; in addition, dividend distributions to Argentine resident individuals or non-Argentine residents are subject to a 7% additionaltax, as per the amendment to the Income Tax Law by Law No. 27,630. These corporate rates apply to fiscal years starting as from January 1, 2021, and the taxon dividends are applicable for fiscal years starting as from January 1, 2018. Argentine residents are exempt from the tax derived from the sale, exchange or other transfer of shares in case of shares issued by Argentinecompanies which are listed in capital markets authorized by the CNV and have authorization for public offering by the CNV as long as such transactions arecarried out through stock exchanges or stock markets authorized by the CNV. Income obtained by non-Argentine residents from the sale, exchange or other transfer of shares is subject to income tax rate of 15% of the netincome or 13.5% of the gross consideration, to the extent such non-Argentine residents do not reside, and the funds invested do not derive from, a non-cooperative jurisdiction as defined by the Income Tax Law and the “black list” included in its regulatory decree; otherwise, the applicable withholding rateswould be 31.5% of the gross consideration. In case of a sale or other transfer between two non-Argentine residents, the income tax must be paid by the seller bymeans of the following mechanisms: (a) if the seller has a legal representative in Argentina, or appoints someone in Argentina for purposes of paying the tax,then such representative or appointed party must pay the tax; and (b) if the seller does not have a legal representative in Argentina and does not appointsomeone, then the seller itself must pay the tax through an international wire transfer . Argentine income tax law also exempts non-Argentine residents from the payment of the income tax on the sales, exchanges or other transfers ofshares issued by Argentine companies which are listed in capital markets authorized by the CNV and have authorization for public offering by the CNV as longas such transactions are carried out through stock exchanges or stock markets authorized by the CNV and to the extent that the seller does not reside in, and thefunds invested do not come from, non-cooperative jurisdictions, as defined by the Income Tax Law and the “black list” included in its regulatory decree. Also, non-residents are exempted from the income tax deriving from the sale or other kind of disposition regarding ADSs which underlyingsecurity are shares issued by Argentine companies that comply with the requirements described above. The holders of our ordinary shares and the ADSs are encouraged to consult with their tax advisers as to the particular Argentine income taxconsequences of owning our ordinary shares and ADSs. See “Item 8. Financial Information—Dividends and Dividend Policy” and “Item 10.E AdditionalInformation—Taxation—Material Argentine Tax Considerations”. Restrictions on transfers of foreign exchange and the repatriation of capital from Argentina may impair our ability to pay dividends and distributions on,and the proceeds of any sale of, the shares underlying the ADSs. On September 1, 2019, the Argentine government issued Executive Decree No. 609/19 (as amended) which, inter alia, reinstated certain foreigncurrency exchange restrictions, most of which had been progressively repealed as from 26
Page 36
Table of Contents 2015. Decree No. 609/19 was further regulated, amended and complemented by several regulations issued by the BCRA (included, but not limited to,Communication “A” 6844, as further amended, supplemented and restated). Since then, the Argentine government implemented monetary and foreign exchangecontrol measures that included restrictions on the transfer of funds abroad, including dividends, without prior approval by the BCRA or fulfillment of certainrequirements. However, starting on January 17, 2020 and until fiscal years beginning on or after January 1, 2025, Argentine companies may transfer fundsabroad in order to pay annual dividends only to foreign shareholders and the depositary for the benefit of the American Depositary Shares, or ADS holders, inan amount that (including the amount of the payment being made at the time of the access) does not exceed 30% of the value of new capital contributions offoreign direct investments made to local companies and the funds must be transferred to Argentina and sold for pesos through the foreign exchange market asfrom such date. In case of non-resident shareholders, the total amount to be paid through the FX Market does not exceed the corresponding amountdenominated in pesos that was determined by the shareholders’ meeting. Access to the foreign exchange market for the payment of dividends in cases not abovecontemplated will require prior approval of the BCRA. According to BCRA Communication “A” 8226, dated April 11, 2025, Argentine companies shall have access to the foreign exchange market topurchase and transfer foreign currency abroad for the payment of profits and dividends to non-resident shareholders pursuant to certain provisions set forth inforeign exchange regulations. These distributions must correspond to distributable profits derived from realized earnings arising from regular and auditedannual financial statements for fiscal years beginning on or after January 1, 2025. In addition to the formal exchange controls and regulations, the Argentine Central Bank has exercised in the past a de facto prior approval powerfor certain foreign exchange transactions otherwise authorized to be carried out under the applicable regulations, such as dividend payments or repayment ofprincipal of intercompany loans as well as the import of goods, by means of regulating the amount of foreign currency available to financial institutions toconduct such transactions.See “Item 10.D Additional Information—Exchange Controls”. Payments of cash dividends and distributions, if any, will be made in pesos, although we reserve the right to pay in other currency or in kind to theextent permitted by applicable law. Subject to applicable law, the ADS depositary will convert such dividends received in pesos into U.S. dollars and pay suchamount to holders of ADSs, net of any dividend distribution fees, ADS depositary's fees and expenses, currency conversion expenses and taxes or governmentalcharges, if any. In the event that the ADS depositary is unable to convert immediately the amount in pesos received as cash dividends or the amount in kind intoU.S. dollars the amount of U.S. dollars payable to holders of ADSs may be adversely affected by depreciation of the peso or the fluctuation of the value of thepayment in kind. In case the depositary for the ADSs is prevented from converting pesos received in Argentina into U.S. dollars for the account of the ADS holdersby any regulatory and/or de facto restrictions that may be applicable, the deposit agreement allows the depositary to distribute the foreign currency only to thoseADS holders to whom it is practicable to do so. If the exchange rate fluctuates significantly during a time when the depositary cannot convert the foreigncurrency, you may lose some or all of the value of the dividend distribution. Your voting rights with respect to the shares are limited. Holders may exercise voting rights with respect to the shares underlying ADSs only in accordance with the provisions of the deposit agreement.There are no provisions under Argentine law or under our by-laws that limit ADS holders’ ability to exercise their voting rights through the depositary withrespect to the underlying shares. However, there are practical limitations upon the ability of ADS holders to exercise their voting rights due to the additionalprocedural steps involved in communicating with such holders. For example, Capital Markets Law No. 26,831 ("LMC") requires us to notify our shareholdersby publications in certain official and private newspapers between 20 and 45 days in advance of any shareholders’ meeting. ADS holders will not receive anynotice of a shareholders’ meeting directly from us. In accordance with the deposit agreement, we will provide the notice to the depositary, which will in turn, assoon as practicable thereafter and subject to legal limitations, provide to each ADS holder upon the terms of the deposit agreement: • the notice of such meeting; • voting instruction forms; and • a statement as to the manner in which instructions may be given by holders (including an express indication that such instructions may bedeemed given upon the terms specified below). 27
Page 37
Table of Contents To exercise their voting rights, ADS holders must then provide instructions to the depositary how to vote the shares underlying ADSs. Because ofthe additional procedural step involving the depositary, the process for exercising voting rights will take longer for ADS holders than for holders of shares. If we timely request the depositary to distribute voting materials to the ADS holders and the depositary does not receive timely voting instructionsfrom an ADS holder on or before the date established by the depositary for such purpose, the depositary shall deem such ADS holder to have instructed thedepositary to give a discretionary proxy to a person designated by our board of directors with respect to the deposited securities represented by the holder’sADSs. The cutoff time for ADS holders to provide voting instructions to the depositary bank is typically up to two business days prior to the cut-off date to voteshares in Argentina so as to enable the depositary bank to tally the ADS voting instructions received from ADS holders and to provide the corresponding votinginstructions at the share level in Argentina through the custodian of the shares represented by ADSs. Except as described in this annual report, holders will not be able to exercise voting rights attaching to the ADSs. Holders of ADSs who wish to propose matters or vote on any matters directly should cancel their ADSs and withdraw their underlying ordinaryshares to attend and vote at the shareholders meetings. If we do not file or maintain a registration statement and no exemption from the Securities Act registration is available, holders of ADSs may be unable toexercise preemptive rights with respect to our ordinary shares, as a result of which your investment may be diluted. Under the Argentine General Companies Law, if we issue new shares as part of a capital increase, our shareholders will generally have the right tosubscribe for a proportional number of shares to maintain their existing ownership percentage, which is known as preemptive rights. However, pursuant to theLMC, our shareholders will not be entitled to the right to subscribe for the unsubscribed shares at the end of a preemptive rights offering, known as accretionrights. We may not be able to offer our ordinary shares to holders of ADSs residing in the U.S., or U.S. holders, pursuant to preemptive rights granted to holdersof our ordinary shares in connection with any future issuance of our ordinary shares unless a registration statement under the Securities Act is effective withrespect to these shares and preemptive rights, or an exemption from the registration requirements of the Securities Act is available. We are not obligated to fileor maintain a registration statement relating to any preemptive rights offerings with respect to our ordinary shares, and we cannot assure you that we will file ormaintain any such registration statement. If we do not file and maintain a registration statement and there is no exemption from registration, the depositary forour ADSs, may attempt to sell the preemptive rights and provide holders of our ADSs with their pro rata share of the net proceeds from any such sale. However,these preemptive rights may expire if the depositary does not sell them on a timely basis, and holders of ADSs will not receive any benefit from suchpreemptive rights. Even if a registration statement were effective, we may decide to not extend any preemptive or subscription rights to U.S. Persons (asdefined in Regulation S under the Securities Act) that are holders of our ordinary shares and holders of ADSs. Furthermore, the equity interest of holders ofshares or ADSs located in the United States may suffer dilution of their interest in us upon future capital increases. We are entitled to amend and supplement the deposit agreement and to change the rights of ADS holders under the terms of such agreement, without theprior consent of the ADS holders. We are entitled to amend and supplement the deposit agreement and to change the rights of the ADS holders under the terms of such agreement,without the prior consent of the ADS holders. Any amendment that imposes or increases any fees, charges or expenses (other than stock transfer or other taxesand other governmental charges, transfer or registration fees, a transaction fee per cancellation request (including through SWIFT, telex or facsimiletransmission), applicable delivery expenses or other such fees, charges or expenses), or that shall otherwise prejudice any substantial existing right of ADS'holders, shall become effective 30 days after notice of such amendment shall have been given to the ADS' holders. Any amendments required by new laws,rules o regulations adopted by governmental body or regulatory body, may become effective before a notice of such amendment or supplement is given to theholders of the ADS. The substantial share ownership position of our controlling shareholder will limit your ability to influence corporate matters. Our controlling shareholder beneficially owns 52.14% of our outstanding ordinary shares as of the date of this annual report. As such, ourcontrolling shareholder has the ability to determine the outcome of substantially all matters 28
Page 38
Table of Contents submitted for a vote to our shareholders and thus exercise control over our business policies and affairs, including, among others, the following: • the composition of our board of directors and, consequently, any determinations of our board with respect to our business direction andpolicy, including the appointment and removal of our executive officers; • determinations with respect to mergers, other business combinations and other transactions, including those that may result in a change ofcontrol; • whether dividends are paid or other distributions are made and the amount of any such dividends or distributions; • cause us to issue additional equity securities; • whether we limit the exercise of preemptive and accretion rights to holders of our ordinary shares in the event of a capital increase to theextent and terms permitted by the applicable law; • sales and dispositions of our assets; and • the amount of debt financing that we incur. Furthermore, our controlling shareholder’s interests may conflict with your interests as a holder of ordinary shares or ADSs, and it may takeactions that might be desirable to it but not to other shareholders and may be able to prevent other shareholders, including you, from blocking these actions orfrom causing different actions to be taken. Also, our controlling shareholder may prevent change of control transactions that might otherwise provide you withan opportunity to dispose of or realize a premium on your investment in our ADSs. We cannot assure you that our controlling shareholder will act in a mannerconsistent with your interests. See ‘Item 7.A. Major Shareholders — Significant Changes in Percentage Ownership’. The Pledge of a portion of our shares by the Controlling Shareholder may lead to market fluctuations and potential change of control On June 4, 2020, Intercement Trading e Inversiones S.A. pledged all of its shares in Loma Negra (which represent 52.14% of our total capitalstock) in favor of Planner Trustee DTVM Ltda., as collateral for debenture obligations of Intercement Participações S.A. and Intercement Brasil S.A. Shouldthe pledge be executed by Planner Trustee DTVM Ltda. to satisfy the debt, it may result in a change of control of the company and it may lead to marketfluctuations in the price of our shares. Such an event could potentially impact our stakeholder interests and future business prospects of our company.On January 6, 2021, Intercement Trading e Inversiones, S.A. notified to Caja de Valores of the transfer of all of its ownership in the company (i.e.304,233,740 ordinary shares) to its subsidiary Intercement Trading e Inversiones Argentina, S.L. Our status as a “foreign private issuer” and as a “controlled company” allows us to follow alternate standards to the corporate governancestandards of the NYSE, which may limit the protections afforded to investors. The NYSE’s rules require domestic listed companies that are not “controlled companies” to have, among other requirements, a majority of theirboard of directors be independent and to have independent director oversight of executive compensation, nomination of directors and corporate governancematters. As a “foreign private issuer”, we are permitted to, and we will, follow home country practice in lieu of the above requirements. Argentine law, the law of our home country, does not require that a majority of our board consist of independent directors or the implementationof a compensation committee or nominating/corporate governance committee. In addition, under the NYSE rules, a “controlled company” in which over 50%of the voting power is held by an individual, a group or another company is also not required to have a majority of its board of directors be independentdirectors and to have a compensation committee or a nominating/corporate governance committee, or to have such committees be composed entirely ofindependent directors. We currently follow certain Argentine practices concerning corporate governance and intend to continue to do so. As a “controlled company”, weare eligible to, and, in the event we no longer qualify as a “foreign private issuer”, we intend to, elect not to comply with certain of the NYSE corporategovernance standards, including the requirement that 29
Page 39
Table of Contents a majority of directors on our board of directors are independent directors and the requirement to maintain a compensation and a nominating/corporategovernance committee consisting entirely of independent directors. Accordingly, holders of our ADSs will not have the same protections afforded toshareholders of companies that are subject to all NYSE corporate governance requirements and our status as a “foreign private issuer” and a “controlledcompany” may adversely affect the trading price for our ADSs. For more information, see “Item 16G. Corporate Governance”. We have incurred and will continue to incur increased costs related to operating as a public company, and our management will be required to devotesubstantial additional time to new compliance initiatives and corporate governance practices. We are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Protection Act, aswell as rules adopted, and to be adopted, by the SEC and the NYSE. Our management is required to certify financial and other information in our quarterly andannual reports, as well as to establish and evaluate periodically disclosure controls and procedures and internal control over financial reporting. Additionally, inlight of our loss of “emerging growth company” status as of December 31, 2022, we can no longer take advantage of an extended transition period forcomplying with new or revised accounting standards and must obtain an annual auditor attestation on the effectiveness of our internal control over financialreporting. For more information, see “—We are subject to ongoing costs and risks associated with determining whether our existing disclosure controls andprocedures and internal controls over financial reporting systems are effective, and if we fail to achieve and maintain adequate controls it could have amaterial adverse effect on our stated results of operations and harm our reputation.” Our management and other personnel have devoted and will need to continue to devote a substantial amount of time to these compliance initiatives.Moreover, we expect these rules and regulations to continue to increase substantially our legal and financial compliance costs, and to make certain activitiesmore time-consuming and costly, which will increase our operating expenses. These rules and regulations applicable to public companies may make and havemade it more difficult and more expensive for us to obtain director and officer liability insurance, and we will likely incur additional costs to maintain sufficientinsurance coverage as a public company going forward. We are subject to ongoing costs and risks associated with determining whether our existing disclosure controls and procedures and internal controls overfinancial reporting systems are effective, and if we fail to achieve and maintain adequate internal controls it could have a material adverse effect on ourstated results of operations and harm our reputation. We are required to disclose whether our disclosure controls and procedures are effective on an annual basis. These are controls and proceduresdesigned to ensure that information required to be disclosed in our SEC reports is recorded, processed, summarized and reported, within the time periodsspecified in the SEC’s rules and forms, and is communicated to our management, including our chief executive officer ("CEO") and chief financial officer("CFO"), as appropriate, to allow timely decisions regarding the required disclosure. Additionally, we are required to comply with the internal control,evaluation and certification requirements of Section 404 of the Sarbanes-Oxley Act and the Public Company Accounting Oversight Board. We are also requiredto provide a management report on the effectiveness of our internal control over financial reporting. The process of determining whether our existing disclosure controls and procedures are effective, and whether internal controls over financialreporting systems are compliant with Section 404 and whether there are any material weaknesses or significant deficiencies in our existing internal controls, hasrequired and will continue to require the investment of substantial time and resources, including by our CEO and other members of our senior management.Such management time and resources, as well as our auditor fees, have increased in connection with this annual report due to the need to obtain the auditorattestation, and we expect them to continue to be significant in future years. Additionally, any remedial actions required could divert internal resources and takea significant amount of time and effort to complete and could result in us incurring additional costs that we did not anticipate, including the hiring of outsideconsultants. We could experience higher than anticipated operating expenses and higher independent auditor fees during and after the implementation of thesechanges. For instance, we amended our annual report on Form 20-F for the fiscal year ended December 31, 2021 after the SEC determined that we hadomitted mining operations disclosures that the SEC deemed to be required under Regulation S-K 1300. As a result, our management determined that ourdisclosure controls and procedures were not effective at the time. To address this, we implemented a series of actions in 2022 to fix these issues, which,according to our management, including the CEO and CFO, have been effectively remedied. The corrective actions included further training on Regulation S-K1300 for our financial reporting and legal teams, better communication and collaboration 30
Page 40
Table of Contents between these teams and a 'qualified person' for preparing Regulation S-K 1300 disclosures, and devising a future compliance plan involving annual materialityassessments of mineral reserves and resources, along with a reporting schedule conforming to Regulation S-K 1300. However, rectifying the issues, respondingto the SEC's feedback, and carrying out the remediation plan demanded substantial time and resources from our management, and the potential remains forfuture risks if we fail to maintain effective disclosure controls and procedures. Any failure of our disclosure controls and procedures or internal controls over financial reporting could have a material adverse effect on ourstated results of operations and harm our reputation. If we are unable to implement any of the required changes to our disclosure controls and procedures orinternal control over financial reporting effectively or efficiently or are required to do so earlier than anticipated, it could adversely affect our operations,financial reporting and/or results of operations and could result in an adverse opinion on internal controls from our management and, our independent auditors.Further, if our internal control over financial reporting is not effective, the reliability of our financial statements may be questioned, our reputation may beharmed, we may become subject to criminal or civil investigations or penalties, and our share price and its trading liquidity may suffer. Under Argentine corporate law, shareholder rights and obligations may be fewer or less well defined than in other jurisdictions. Our corporate affairs are governed by our by-laws and by the Argentine corporate law, as amended, which differ from the legal principles thatwould apply if we were incorporated in a jurisdiction in the United States (such as Delaware or New York), or in other jurisdictions outside Argentina. Thus,your rights or the rights of holders of our ordinary shares or ADSs under the Argentine corporate law to protect your or their interests relative to actions by ourboard of directors may be fewer and less well defined under Argentine corporate law than under the laws of those other jurisdictions. Although insider tradingand price manipulation are illegal under Argentine law, the Argentine securities markets are not as highly regulated or supervised as the U.S. securities marketsor markets in some other jurisdictions. In addition, rules and policies against self-dealing and regarding the preservation of shareholder interests may be lesswell defined and enforced in Argentina than in the United States, or other jurisdictions outside Argentina, putting holders of our ordinary shares and the ADSs ata potential disadvantage. The protections afforded to minority shareholders in Argentina are different from and more limited than those in the United States and may be moredifficult to enforce. Under Argentine law, the protections afforded to minority shareholders are different from, and much more limited than, those in the United States.For example, the legal framework with respect to shareholder disputes, such as derivative lawsuits and class actions, is less developed under Argentine law thanunder U.S. law as a result of Argentina’s short history with these types of claims and few successful cases. In addition, there are different proceduralrequirements for bringing these types of shareholder lawsuits. As a result, it may be more difficult for our minority shareholders to enforce their rights againstus or our directors or controlling shareholder than it would be for shareholders of a U.S. company. Investors may not be able to effect service of process within the United States limiting their recovery of any foreign judgment. We are a publicly held corporation (Sociedad anónima) organized under the laws of Argentina. Most of our directors and our executive officers,and a significant part of our assets are located in Argentina. As a result, it may not be possible for investors to effect service of process within the United Statesupon us or such persons or to enforce against us or them in United States courts judgments obtained in such courts predicated upon the civil liability provisionsof the United States federal securities laws. There is doubt whether the Argentine courts will enforce, to the same extent and in as timely a manner as a U.S. orforeign court, an action predicated solely upon the civil liability provisions of the United States federal securities laws or other foreign regulations broughtagainst such persons or against us. In addition, the enforceability in Argentine courts of judgments of U.S. or non-Argentine courts with respect to mattersarising under U.S. federal securities laws or other non-Argentine regulations will be subject to compliance with certain requirements under Argentine law,including the condition that any such judgment does not violate Argentine public policy (orden público). Our shareholders may be subject to liability for certain votes of their securities. Our shareholders are not liable for our obligations. Instead, shareholders are generally liable only for the purchase price of the shares theysubscribe. However, shareholders who have a conflict of interest with us and who do not 31
Page 41
Table of Contents abstain from voting may be held liable for damages to us, but only if the transaction would not have been approved without such shareholders’ votes.Furthermore, shareholders who willfully or negligently vote in favor of a resolution that is subsequently declared void by a court as contrary to ArgentineGeneral Companies Law or our bylaws may be held jointly and severally liable for damages to us or to other third parties, including other shareholders. As aresult, we cannot assure you that some shareholders may not be held liable for damages or other expenses under the Argentine General Companies Law. ITEM 4. INFORMATION ON THE COMPANY A. History and Development of the Company Loma Negra is a corporation organized as a Compañía Industrial Argentina Sociedad Anónima under the laws of Argentina. Our principalexecutive offices are located at Boulevard Cecilia Grierson 355, 4 Floor, Zip Code C1107CPG – Ciudad Autónoma de Buenos Aires, Argentina and thetelephone number of the office is 54-11-4319-3048. We file reports, including annual reports on Form 20-F, and other information with the SEC pursuant to the rules and regulations of the SEC thatapply to foreign private issuers. The SEC maintains an internet site that contains reports, proxy and information statements, and other information regardingissuers that file electronically with the SEC. Any filings we make electronically with the SEC are available to the public at the SEC’s web site athttp://www.sec.gov. Our website is http://www.lomanegra.com. The contents of our website and other websites referred to herein are not part of this annualreport. We were incorporated on May 10, 1926 and registered in the regulatory agency on August 5, 1036. Our date of expiration is July 3, 2116 and,pursuant to section 4 of our bylaws, our corporate purpose includes engaging in commercial, industrial, real estate and financial activities. We are alsoauthorized to carry out business in the mining and construction industries, and to operate transportation and public services. In 1998, we acquired the concrete operations of several producers in the greater Buenos Aires area and in the city of Rosario. These companieswere merged into Loma Negra in 2010. We operate our concrete business under the Lomax brand, and we are the leading concrete company in the greaterBuenos Aires area and Rosario, being specialists in large construction projects as this segment includes a broad product line of specialty concretes. In the early 2000s, we finished the construction of L’Amalí, located approximately five kilometers from our Olavarría plant, and LomaSer, locatedapproximately 50 kilometers from the city of Buenos Aires. These two plants are connected through the Ferrosur Roca railway, being a complement of eachother, aiming to better serve the greater Buenos Aires and the city of Buenos Aires area, Argentina’s most important cement consumption market. In 2005, we became part of the InterCement Group. Since then, we have invested in several projects, which have allowed us to increaseproduction and be more efficient and competitive in a demanding market. In order to diversify our energy matrix, we invested in alternative fuels (petroleumcoal-petcoke), which makes it possible to keep our kilns running throughout the year substituting, if necessary, natural gas. In 2009, we acquired La Preferida de Olavarría S.A., or La Preferida de Olavarría, a quarry of stone crushing, thereby allowing us to strengthenour vertical integration. In 2015, this company was merged into Loma Negra. In 2006, the Loma Negra Foundation was created with a vision of community development and toward the self-sustainability of projects throughpartnerships with several local actors or other public or private institutions. The Loma Negra Foundation primarily invests in projects related to education,capacity-building, entry of young people into the labor market and inclusive productive business. In 2012, we acquired 35% of Yguazú Cementos’, a Paraguayan cement company, outstanding shares from Votorantim Cimentos. Additionally, in2016, we acquired an additional 16% of the company’s outstanding shares from InterCement Brasil, which led us to achieve the control of Yguazú Cementos,with 51% of ownership in the company. However, on August 21, 2020, we decided to sell our total stake in Yguazú Cementos, an operation with high standardsof production and profitability. The sale was made to the local shareholder of Yguazú Cementos. We believe the economic result obtained by this operation wasvery beneficial for us and is in line with the goal of maximizing value for our shareholders. The sale price was US$107 million, and we used the proceeds torepay existing debt and distribute extraordinary dividends. th 32
Page 42
Table of Contents On October 31, 2017, we completed our initial public offering and on November 1, 2017, our ADSs representing ordinary shares began to trade onthe NYSE and our ordinary shares began to trade on BYMA. On December 2021, we inaugurated the second line of our L’Amalí plant, located in the city of Olavarría, in the province of Buenos Aires. Thissecond line allows us to increase significantly our production capacity, making our plant one of the largest in South America. The incorporation of the new lineis a technological update to our plant and increases our productivity. The new line also adopts sustainability policies that comply with internationalenvironmental guidelines in terms of environmental care. The new line has high efficiency features, low thermal and electrical consumption and water reusesystems. It incorporates a new clinker kiln that is prepared for the use of alternative fuels made from co-processed waste that replace fossil fuels. In the context of the L’Amalí expansion, and considering market demands, we decided to repurpose the Barker and San Juan plants. Wetransformed these plants’ full cement lines into grinding and distribution centers. In 2021, considering the facts above-mentioned, we determined to close theSierras Bayas Plant. Our most recent material investments is the one related to Resolution 54/2018 of the Secretary of Commerce of adjusting our cement bags to the25 kilograms format. which should be effective as of July 1, 2025. B. Business Overview We produce and distribute cement, masonry cement, aggregates, concrete and lime, which are products primarily used in private and publicconstruction. We work with wholesale distributors, concrete producers and industrial customers, among others. We are a vertically-integrated cement andconcrete company, with nationwide operations, supported by vast limestone reserves, strategically located plants, top-of-mind brands and establisheddistribution channels. As of December 31, 2024, we held a market share of 44.4% in terms of sales volume in Argentina according to our managementestimates. Over our 99-year history we have built Argentina’s sole nationwide vertically integrated cement and concrete business, supported by top-of-mindbrands and captive distribution channels. As of December 31, 2024, our annual installed clinker and cement production capacities amounted to 7.3 million tonsand 12.1 million tons, respectively. We hold significant, strategically located limestone reserves and we estimate that our existing quarries have sufficientreserves to support our operations for approximately 149 years, based on the cement production levels of the last five years. For the year ended December 31, 2024 and 2023, we had revenues of Ps. 699,179 million and Ps. 919,313 million, respectively, and net profit ofPs. 153,627 million and Ps. 21,080 million, respectively. For the year ended December 31, 2024 and 2023, we also had net profit margin (net profit divided byrevenues and expressed as a percentage) amounted to 22.0% and 2.3%, respectively. Our net debt (borrowings offset against cash and banks, cash-equivalentand other short term investments) as of December 31, 2024 was Ps. 162,348 million and Ps. 306,254 million for December 31, 2023. Our Products We offer our customers a broad range of high-quality cement products and a diversified product portfolio aimed at meeting all of their cementneeds. Since our inception, we have developed and expanded our product range, tailoring different mixtures and product lines for a wide variety of uses andclient needs. We currently produce cement (compound cement, cement with calcareous filler, pozzolana cement, as well as other specialty type cements),masonry cement, lime and concrete. In 2023 and 2024, cement accounted for approximately 88% and 89% of our shipments, respectively. In Argentina, we sell our products under the Loma Negra trademark, which we believe is the most well-known cement brand in Argentina, andwhich we believe is synonymous with “cement” in the country. We believe that our brand recognition is important, given that bagged cement represents asignificant part of the cement sold in Argentina. We sell our products in bulk and in bags, with bagged cement representing approximately 56% of our sales in2023 and 60% in 2024. Cement Through our brand name Loma Negra and our San Martín brand, a well-known brand for Portland cement and compound cement, we produce 11different types of cement in bags and 16 types of cement in bulk. Our cement 33
Page 43
Table of Contents products meet all requirements and quality standards as outlined in the following Standard Specifications of the Instituto Argentino de Normalización yCertificación, or the IRAM Institute: IRAM-50000:2024, IRAM-50001:2019 and IRAM-50002:2009. These specifications were constructed based upon theEuropean Cement Standards. The IRAM Institute is a member of the International Standard Organization, or the ISO. Masonry Cement As part of our continued diversification of our product line, we entered the masonry cement market in 1973. Our masonry cement brand Plasticoris well-known in Argentina. In the masonry cement market we believe we are market leaders, followed by Hidralit of Cementos Avellaneda S.A., in a marketthat represents approximately 1 million tons per year. Lime We produce two different types of lime: (1) hydraulics, under the brands Cacique Plus and Cacique Max; and (2) industrial, under our brand LomaNegra Plus. These products are generally used for generic masonry, underpinning, interior and exterior plaster, interior and exterior subfloors and soilstabilization. The mixing process includes cement, sand and lime. The oldest and most traditional use of lime has been in mortar and plaster, because of its superior plasticity and workability. There are otherapplications of lime in construction. The dominant construction-related use of lime is soil stabilization for roads, building foundations and earthen dams. Limeis added to low quality soils to produce a usable base and sub base. Hydrated lime has long been acknowledged to be a superior anti-stripping addition forasphalt pavements. It also helps resist rutting and fracture growth at low temperatures, reduce age hardening and improve the moisture resistance and durability. Concrete and Aggregates We participate in the concrete market under our Lomax brand offering different types of concrete. We also sell granitic aggregates through ourplant La Preferida in Olavarría, which is responsible for approximately 39% of the aggregates consumed by Lomax in their concrete production operations, asof 2024. Lomax offers a highly recognized set of solutions to our clients, including quality control, in-place facilities and logistics solutions, among otherfeatures, which can be customized to our customer’s needs. Lomax concentrates its operations on the segments in which it can assert its differential attributes:focus on quality, operational and logistic capacity and development of customized solutions. Production Process Cement Production We produce cement in a closely controlled chemical process. All our plants use the dry cement production process, incorporating state of the arttechnology. Below we set forth the standard phases of the cement production process, which consists of the following main stages: extraction and transportationof limestone from the quarry; grinding and homogenization to make the raw meal of consistent quality; clinkerization; cement grinding; storage in silos; andpackaging, loading and distribution. 1. Mining The extraction process of the principal raw materials (limestone and clay). Naturally occurring calcareous deposits such as limestone, marl orchalk provide calcium carbonate and are extracted from quarries, often located close to the cement plant. In the pre-operational phase, the extraction processbegins with mining research and probing to identify the quality and quantity of limestone. Once economic feasibility is established, we begin planning themining work to define final digging configuration as well as the size of the fleet of vehicles and equipment needed for the operation. In the operational phase,the blocs are marked, and the holes are made by punch presses. The holes are then loaded with explosives and detonated to obtain fragmented material, which isthen transported to the crushing system to reduce the granulation level. Clay extraction does not normally require explosives. 34
Page 44
Table of Contents 2. Transportation Limestone is loaded by large blades on dump trucks and carried to the crushing plant. 3. Primary crushing The primary crusher converts the rocks into small stones. 4. Pre-homogenization of the limestone and clay Approximately 90% of the limestone is stored in a park, where the first homogenization of the chemical composition of the stone is achieved. Atthe crusher, the limestone rocks are reduced to fragments measuring approximately ten centimeters for vertical raw mills, and one inch for ball mills. Thiscrushed limestone is then transported to the cement plant by truck or conveyor belt. Clay is also transported by truck to the plants. At the clinker plant, crushedlimestone is blended by reducing the variations in chemical properties in order to obtain a homogenized mixture of limestone and clay. 5. Grinding and homogenization (“raw meal” production) The crushed pieces are then milled together to produce a powder called “raw meal”. Subsequently, the raw meal is sent to a blending/storage silofrom where it is fed into the pre-heater. 6. Burning of raw meal to produce clinker (“clinkerization”) A pre-heater is a series of vertical cyclones through which the raw meal is passed. In these cyclones, thermal energy is recovered from the hot fluegases and the raw meal is preheated before it enters the kiln, so the necessary chemical reactions occur faster and more efficiently. Calcination is thedecomposition of limestone to lime. Part of the reaction takes place in the “pre-calciner” and part in the kiln. Here, the chemical decomposition of limestonetypically emits 65% of total emissions. The pre-calcined meal then enters the kiln. Fuel is fired directly into the kiln to reach temperatures of up to 1,450degrees Celsius. The intense heat causes chemical and physical reactions that partially melt the meal to form a mixture of calcium silicates and other silicates,which is called “clinker”. 7. Cooling and final milling of clinker to produce cement From the kiln, the hot clinker falls onto a grate cooler where it is cooled to a temperature of approximately 100 degrees Celsius by incomingcombustion air. A typical cement plant will have clinker storage between clinker production and grinding. Traditionally, ball mills have been used for grinding,although more efficient technologies like roller presses and vertical mills are used in many modern plants today. In this form, cement reacts as a binding agentthat, when mixed with water, sand, stone and other aggregates, is transformed into concrete or mortar. 8. Storing in the cement silo The final product is stored in cement silos and dispatched from there to either a packing station (for bagged cement) or to a bulk silo. Most of ourproduct is sold in paper bags, which are generated through an industry standard automatic bagging process. 9. Cement dispatch Cement is dispatched in bulk or in paper bags sacked on pallets. 35
Page 45
Table of Contents The chart below illustrates the different phases of our cement production process, as numbered above: To ensure an efficient production process, our plants use monitoring and control tools, including: (1) automated controls using specializedsoftware for the operation and monitoring of the cement production process; (2) measuring and testing equipment that offer metrological reliability; and (3)SAP system support for management of production planning and maintenance. Concrete Production Concrete is produced either in concrete plants and transported directly to construction sites as concrete in trucks or produced at the constructionsites. In the concrete industry, it is crucial to have a close network of concrete plants to meet customers’ delivery needs. The concrete production process is a question of minutes with a logistic cycle of 2.5 hours per trip. Cement mixed with water, fine aggregates,coarse aggregates and chemical admixtures enters the hydrate phase. After a short period, a chemical reaction hardens the concrete into a permanent form ofartificial stone. Compressive strength, durability, setting times, ease of placing, and workability under various weather and construction conditions characterizethis building material. Lime Production 1. Mining, crushing and homogenization of the limestone The extraction process of the principal raw material: limestone. See “—Cement Production”. 2. Burning of limestone to produce quicklime (“calcination”) The limestone then enters the kiln. Fuel is fired directly into the kiln to reach temperatures of up to 1,200 degrees celsius. The intense heat causesphysical reactions that partially transform limestone into quicklime. While there are multiple kiln types in use, we have a rotary kiln in our plants. A rotary kiln consists of a rotating cylinder that sits horizontal.Limestone is fed into the upper or “back end” of the kiln, while fuel and combustion air are fired into the lower or “front end” of the kiln. Limestone is heatedas it moves down the kiln toward the lower end. As the preheated limestone moves through the kiln, it is “calcined” into lime to reach temperatures of up to1,200 degrees celsius. The lime is discharged from the kiln into a cooler where it is used to preheat the combustion air. Lime can either be sold as is or crushedto make hydrated lime. 3. Cooling and storing of quicklime From the kiln, the hot lime falls onto a grate cooler where it is cooled to a temperature of approximately 200 degrees celsius by incomingcombustion air. A typical lime plant will have a quicklime production and hydration and classification plant. 36
Page 46
Table of Contents 4. Hydration and classification plant to produce hydrated lime Quicklime can be processed into hydrated lime by crushing the quicklime, adding water to the ground lime, and then classifying the hydrated limeto ensure it meets customer specifications before it is transported. 5. Storing in the lime silo and dispatch The final product is stored in lime silos and dispatched from there to either a packing station (for bagged hydrated lime) or to a bulk silo. Most ofour product is sold in paper bags, which are generated through an industry standard automatic bagging process. Masonry Cement Production The production of masonry cement is similar to cement production, See “ —Cement Production”. However, the blending and final milling of theclinker processes vary in the production of masonry cement. 1. Blending Masonry cement consists of a mixture of clinker, gypsum and plasticizing materials (such as limestone), together with other additions introducedto enhance one or more properties of the cement, such as: setting time, workability, water retention, and durability. We prepared our additions for masonrycement at our Olavarría plant. 2. Final milling of clinker to produce masonry cement Ball mills are used for grinding. In this form, masonry cement is designed to be mixed with sand and water to produce a masonry mortar. Masonrymortar is specially formulated and manufactured for use in brick, block, and stone masonry construction. Masonry cements are also used to produce stucco. 3. Storing in the cement silos The final product is stored in cement silos and dispatched from there to either a packing station (for bagged masonry cement) or to a bulk silo.Most of our product is sold in paper bags, which are generated through an industry standard automatic bagging process. Capacity and Volumes In 2023, our production volume reached 6.4 million tons of cement, masonry and lime, and in 2024, it reached 4.8 million tons. We had a cementinstalled capacity of 12.1 million tons, a concrete installed capacity of 1.3 million m, an aggregated installed capacity of 2.2 million tons annually and a limeinstalled capacity of 0.5 million tons annually. Annual installed capacity is based on a 365-day production per annum based on international key performanceindicators, or KPIs. 3 37
Page 47
Table of Contents The following table sets forth certain data related to our operations for the periods indicated. As of and for the Year EndedDecember 31, 2024 2023 2022 Operating data (million tons annually) Installed cement capacity Total installed cement capacity 12.1 12.1 12.1 Installed clinker capacity Total installed clinker capacity 7.3 7.1 7.1 Installed concrete capacity in Argentina (in m) 1.3 1.3 1.3 Installed aggregates capacity in Argentina 2.2 2.2 2.2 Installed lime capacity in Argentina 0.5 0.5 0.5 Production volume (millions of tons): Cement, masonry and lime total 4.8 6.4 6.5 Clinker Total 3.1 4.3 4.3 ________________(1) Annual installed capacity is based on a 365-day production per annum based on international KPIs. (2) Installed concrete capacity refers to concrete capacity based on plants dispatch capacity. The table below sets forth the name, location and annual clinker and cement production at each of our seven cement plants during the year endedDecember 31, 2024: Name Location AnnualProduction ofClinker Annual Productionof Cement,Masonry Cementand Lime (in millions of tons) Barker Benito Juárez — 0.1 Catamarca El Alto 0.6 0.9 L’Amalí / LomaSer Olavarría/VicenteCasares 2.2 2.6 Olavarría Olavarría — 0.6 San Juan San Juan — 0.1 Zapala Zapala 0.2 0.3 Ramallo Ramallo — 0.2 Total 3.1 4.8 (1) 3 (2) 38
Page 48
Table of Contents The following table sets total production of each of our plants of cement, masonry cement and lime, our principal products, for each of the periodsindicated: Name Production for the Year Ended December 31, 2024 2023 2022 (in millions of tons) Argentina: Barker 0.1 0.1 0.1 Catamarca 0.9 1.2 1.2 L’Amalí/ LomaSer 2.6 3.6 3.6 Olavarría 0.6 0.8 0.9 San Juan 0.1 0.2 0.2 Zapala 0.3 0.3 0.3 Ramallo 0.2 0.2 0.2 Total 4.8 6.4 6.5 Quality Control We monitor quality control measures at each stage of the cement production process. At each of our plants, we review our production line, andperiodically perform examinations of the raw material mix. These examinations include chemical, physical and x-ray tests. We perform similar examinations onthe clinker we produce as it comes out of our kilns. In addition, we similarly test our finished products. These examinations are performed by sampling the subject material from the various points on each production line. All of our plants havereceived ISO 9001 certification, which reflects the quality of our products and of our operating procedures. Our quality controls comply with the ISO 9000rules. Raw MaterialsThe principal raw materials used in the production of cement include: (1) limestone, clay and gypsum for the production of clinker, and (2) clinkeradditions, including blast furnace slag, pozzolana, fly ash, and paper bag, since we package a substantial portion of our cement in bags. These items, amongothers raw materials, collectively represented 19% in 2024, 18% in 2023 and 15% in 2022, of our total cost of sales. To further maintain our costcompetitiveness, we obtain nearly all of our mineral resources from our own quarries, using, either third party services or our own mining equipment. For theyear ended December 31, 2024, all of our limestone was sourced from our own quarries. We own and exclusively operate our limestone quarries. Mining Operations Disclosure (Mineral Reserves) The disclosures in this section titled “Mining Operations Disclosure” are provided to comply with Regulation S-K Item 1300 of the SEC, whichgovern disclosures by registrants engaged in mining operations. This section contains summary disclosure of all of the company’s mining operations as requiredby Regulation S-K Item 1303. Additionally, the company considers the La Pampita y Entorno mining operations to be individually material for purposes of application ofRegulation S-K 1304, and thus has provided individual property disclosure for them as so required. Our reserves are a sum of proven and probable reserves.The terms “mineral resource,” “mineral reserves”, “proven reserves” and “probable reserves” as used in this section are defined in accordance with RegulationS-K Item 1300. “Proven reserves” are those mineral masses for which size, shape, depth and mineral content of reserves are well established, revealed bygeological surveys, drilling campaigns, chemical analysis and geological modeling, to ensure exploitability and usage. All of these activities determine thequantity of minerals that matches the quality required by our production process. Our proven reserves contain suitable geological and chemical informationdensity (drill holes) to guarantee their existence, continuity and the suitability of use. Proven reserves are constrained by a final pit configuration (effectivelyexploitable reserves). In addition to the foregoing, we consider reserves to be proven if they are present on land we own and if related environmental permitshave been granted. “Probable reserves are mineral masses for which quantity or quality are computed from information similar to that used from provenreserves, but the sites for inspection, sampling, and measurement are farther apart. Our probable reserves contain similar suitable geological and chemicalinformation density (drill holes) to guarantee their existence, continuity and the suitability of use than our proven reserves. The degree 39
Page 49
Table of Contents of assurance, although sometimes lower than that for proven reserves, is high enough to assume continuity between points of observation. In addition to theforegoing, we consider reserves to be probable if they are not present on land we own or if related environmental permits have not been granted. Our proven and probable reserve estimates are based on estimated recoverable tons and are prepared by our engineers and geologists (at least oneof whom is a “qualified person” as defined in Regulation S-K Item 1300) and then analyzed and verified by other business units within the company. For thefiscal year ended December 31, 2021, we filed as Exhibit 96.1 to the annual report on Form 20-F, a copy of the technical report summary (TRS) prepared by a"qualified person" employed at the company (the "Qualified Person") that was required by Regulation S-K Item 1302. Such TRS identifies and summarizes inall material respects the information reviewed and conclusions of such qualified person specifically to the La Pampita y Entorno individual property disclosuresin this section as of the dates stated in such technical report summary. For the fiscal year ended December 31, 2024, the Qualified Person after careful reviewdetermined that there have been no material changes to our reserves at the La Pampita y Entorno quarry that would necessitate an update to the TRS filed forthe fiscal year ended December 31, 2021. Therefore, we have not engaged in the preparation of a new TRS for the current reporting period. The company'sengineering and geological teams, along with our corporate oversight functions, ensure ongoing accuracy and relevance of our mineral reserve data. We willcontinue to monitor and will disclose any material changes to our reserves in accordance with SEC requirements and our commitment to transparency andshareholder communication. In line with Regulation S-K 1300, we make no determination in this section as to the existence of mineral resources for any of our other miningproperties, as it is not material to our business. Summary Mining Operations Disclosure Overview of Mining Properties and Operations Our cement operations are supplied by limestone reserves that are located within close proximity to our production facilities. We own and operatefour open-pit quarries from which limestone can be extracted efficiently due to the proximity of the limestone deposits to the surface and the quality of thelimestone in the mines that meets the process requirements. We have total limestone reserves of approximately 1,068.5 million tons, which should be sufficientto supply us with approximately 149 years of cement production at our last five years rate of consumption. Each of our plants possesses and is responsible for several active and inactive mining licenses. Active mining licenses are those for which we holdall necessary permits and rights to actively exploit the mineral resources. Each of our plants also holds inactive mining licenses on areas for which we do nothave the operational license, since their exploitation is not currently necessary. Our mining capital expenditures are focused on developing new quarries and sustaining investments, and are used mainly for mining equipment,crushing systems, safety equipment and environmental compliance. The below table includes a complete list of our mining operations, including relevant information for each quarry. As noted below, all of ourmining operations are in the production stage. 40
Page 50
Table of Contents List of our Mining Operations by Region Name of miningoperation Location of themining operationType and amountof ownershipinterests Operator Surface Stage of themining operationPermits Key condition ofpermit Type of mine /materialBeneficiation plantand otherinstallations AggregateProduction 2022AggregateProduction 2023AggregateProduction 2024 (Has) (in thousands of tons) Doña Amalia Catamarca 100 Loma Negra 298 Production Yes EIA and others Open Pit /Limestone Mining facilities 1620.6 1621,0 1175.1 Piedras Blancas San Juan 100 Loma Negra 117 Closed Yes EIA and others Open Pit /Limestone Mining facilities 14.4 0.1 0 El Salitral y Cerro Bayo Zapala 100 Loma Negra 2,995 Production Yes EIA and others Open Pit /Limestone Mining facilities 466.2 467.2 383.7 Barker Barker 100 Loma Negra 269 Production Yes EIA and others Open Pit /Limestone Mining facilities 331.9 314.4 288.8 La Pampita y Entorno Olavarría 100 Loma Negra 1,850 Production Yes EIA and others Open Pit /Limestone Mining facilities 5949.8 5.632 3942 La Preferida Buenos Aires 100 Loma Negra 94 Production Yes EIA and others Open Pit / Granite Mining facilities 1310.7 1459.8 1133.9 Environmental Impact Study (EIA). Permits or licenses have been obtained, are being renewed or are being processed in accordance with current regulations. As to the date of this annual report, Piedras Blancas Quarry is closed and no further exploitation is expected. The aggregate production of all limestone mining operations for each of the years ended December 31, 2024, 2023 and 2022 was 7,179.3thousand tons, 8,034.7 thousand tons and 8,382.9 thousand tons, respectively, and the production of our granite operation for each of the years ended December31, 2024, 2023 and 2022 was 1,100.6 thousand tons, 1,459.8 thousand tons and 1,310.7 thousand tons, respectively. The following map of Argentina shows the location of our total material and non-material mining operations. Our mining operations are located inCatamarca, San Juan, Zapala, and the central Buenos Aires region. For more information on all of our facilities, see “Item 4.D—Information on the Company—Properties.” (1) (2) (1) (1) (1) (1) (1) (1) (2) 41
Page 51
Table of Contents General Map of our Mining Operations Overview of Mineral Reserves The below table summarize the mineral reserves of all of our mining concession. We do not classify our reserves by average grade. Drilling or sample density information is not the key criteria we use to distinguish proven from probable reserves. Nevertheless, to analyze the drill holedata from our quarries we assume the following distance ranges between drill holes: for active quarries, between 60 and 150 meters, and for inactive quarries,between 150 and 300 meters. The density between drill holes (samples) used in the reserves estimation process is a function of the geological complexity of thedeposits and the chemical heterogeneity of the materials used in the process; therefore, we do not have a single, fixed criteria for all of our mineral reserves. Wealso do not use the price or cost of raw materials used in the cement production process as a variable in our reserves’ evaluation process because there is noglobal commodity market value for these raw materials, which prices depend on the cement local market value. We distinguish recoverable limestone from waste by evaluating whether the limestone rocks are adequate to be used in a raw mill, which is a powdercomposed of a clay and limestone mixture, and other minerals. In order to meet raw mill specifications, we generally use limestone with at least a 75%concentration of calcium carbonate (CaCO3). Although there is no specific cutoff grade for aggregates, we distinguish recoverable aggregates from waste bysegregating the type of rock extracted from the quarry. The most common rocks used for aggregates production are granite, basalt, limestone, sand or gravel. Depending on the type of cement product, we require approximately 1.5 tons of limestone to produce one ton of clinker. On average, we requireapproximately 1.2 tons of limestone to produce one ton of cement product. In addition, on average, we required approximately one ton of rock to produce oneton of aggregates product. 42
Page 52
Table of Contents Summary of our Mineral Reserves as of December 31, 2024 Proven mineral reserves Probable mineral reserves Total mineral reserves Amount Grades/ QualitiesAmount Grades/ QualitiesAmount Grades/ Qualities (Million Tons) (% CaO) (Million Tons) (% CaO) (Million Tons) (% CaO) Limestone: Doña Amalía 49.2 44.0 56.2 44.6 105.4 44.2 Piedras Blancas — — — — — — El Salitral y Cerro Bayo 30.4 44.1 48.4 43.7 78.8 43.8 Barker 43.6 46.4 27.0 46.1 70.5 46.2 La Pampita y Entorno (Don Gabino –Los Abriles – SASII) 575.8 47.4 35.3 47.1 611.1 47.4 Cerro Soltero I — — 53.5 — 53.5 — Cerro Soltero II — — 111.6 — 111.6 — El Cerro — — 37.6 — 37.6 — Granitic aggregates: La Preferida 59.0 — 54.2 — 113.2 — The Company used an average price of US$ 93 per tonne for the economic analysis. The average price of US$ 93 per tonne is based on the Company's technical report prepared for the fiscal yearended December 31, 2021.(1) Limestone is used for cement and lime production. 100% of the limestone received at the plant is used.(2) As to the date of this annual report, Piedras Blancas Quarry is closed and no further exploitation is expected. Individual Properties Disclosure La Pampita y Entorno Location and History The La Pampita y Entorno quarry extends over the mining operations of La Pampita, Don Gabino, Los Abriles, and San Alfredo Sur II, which arelocated in the district of Olavarría, Buenos Aires province. The quarry is located 20 kilometers to the southeast of the city of Olavarría, near the town of VillaAlfredo Fortabat. The region is generally characterized by nonmetal mining activity, including cement as well as aggregates and ceramics. The mining operations are carried out on land owned by Loma Negra since 1980. Exploration activity began that same year and has since beenconducted discontinuously to date. Exploitation of the La Pampita mining property began in 1999. The San Alfredo Sur II, Los Abriles and Don Gabino miningproperties are currently inactive and do not register any mining activities (i.e., they are entirely exploratory projects). In 2024, we did not conduct anyexploration activity at the La Pampita y Entorno quarry. Our L’Amalí and Olavarría cement plant and La Pampita y Entorno mining operations are shown in the maps below. (2) (1) 43
Page 53
Table of Contents L’Amalí and Olavarría Cement Plant Right Image — Lower right margin: Latitude: 37° 3'12.12"S, Longitude: 60°14'58.06"W. Top left margin: Latitude: 36°58'42.59"S, Longitude: 60°19'58.69"W. La Pampita y Entorno Mining Operations Right Image — Lower right margin: Latitude: 37° 4'52.25"S, Longitude: 60° 6'33.87"W. Top left margin: Latitude: 36°50'41.71"S, Longitude: 60°21'49.94"W. Infrastructure and Personnel The La Pampita y Entorno quarry has the necessary infrastructure for normal operations. Facilities for electric power, water supply, fuels,accesses, and roads have been installed. 44
Page 54
Table of Contents La Pampita y Entorno has two primary ThyssenKrupp crushers. One sends limestone to L'Amalí plant through conveyor belts for further storagein two preheaters. The other primary crusher sends material either to the lime factory or to the secondary crusher. In the quarry, electrical energy is supplied through a 33 Kv line coming from the L’Amalí plant, and the plant is externally fed by a 132 KV line.There are seven electrical substations in the quarry. The fuel used for operational purposes is supplied to the contractor by a subcontractor. The water extracted from the quarry is used for irrigation, dust suppression sprinkler systems in crushers and belts, quarry services (buildings andrestrooms) and for 100% of the water supply to the L’Amalí plant. Loma Negra’s personnel conducts its operations at La Pampita quarry with its own staff and contractors, including 18 employees and 114outsourced staff from both contractors. The majority of the La Pampita y Entorno quarry’s personnel comes from the town of Olavarría, adjacent to the quarry. There are also personnelfrom other regions of Argentina. Personnel are transported from the town of Olavarría to the quarry in buses and pickup trucks. Mining Concession Ownership and Area The mining producer registration (RPM) was granted by Resolution EX-2020-15636796-GDEBA-DPGMMPCEITGP of the Undersecretary ofMining of Buenos Aires Province. The procedure to obtain a mining concession is established in Argentina’s Mining Code (as described below). We have the surface rights of the operation area in the La Pampita y Entorno quarry. Royalties The main statute that governs mining in Argentina is the Mining Code, which was enacted nationwide by Law No. 1,919 of 1886, as amended. We pay the mining canon for each concession on a bi-annual basis. Payment is equivalent to US$0.5 per hectare. The payment is made through regular banking channels. In the event that mining royalties are not declared or paid, penalties for infractions and default interest for non-compliance are incurred. However,failure to pay these fines will not result in the loss of the mining concession. We also pay a quarry exploitation fee. Municipalities establish certain taxes that may have incidence on mining developments. Each jurisdiction inwhich mining activities are developed has its legislation. For example, municipalities may charge a quarry exploitation quota equivalent to the amount of limestone contained in the cement dispatched orsold from the factory at a rate determined by each municipality. The rate is determined at a fixed amount, which is updated on a monthly basis. This amountrepresented 1.4% of sales in 2024 of cement, masonry cement and lime. Set forth below is additional information relevant to this property. Mining Activities The mining method is open pit mining, which consists of mining in a series of benches with pit expansion possible both vertically and laterally.The quarry generally proceeds top-down with a height of 10 meters. The materials are then loaded and transported to the primary crusher or waste dump bydump trucks. 45
Page 55
Table of Contents The diagram below sets forth a block diagram of the mining process of the La Pampita y Entorno quarry. Diagram of Mining Process of the La Pampita y Entorno Quarry Cement Plants Our L’Amalí and Olavarría plants have been in operation for 24 and 99 years, respectively, and both use the limestone extracted from the LaPampita quarry in the manufacture of cement and lime. Our L’Amalí and Olavarría plants are located in Olavarría area. These plants are located two and five kilometers, respectively, from the LaPampita y Entorno quarry and receive raw materials from the La Pampita y Entorno quarry. Our plants produce various products for the construction industry, the main product being cement. Different types of cement are produceddepending on their applications, using limestone, iron ore and clays as raw materials. Our Olavarría plant also produces lime as a product, using limestone as araw material. The below figure shows the flow of cement production at the L'Amalí and Olavarría plants. L'Amalí and Olavarría plants process block diagram The below figure shows the flow of lime production at the Olavarría plant. 46
Page 56
Table of Contents Olavarría plant process block diagram for lime production We believe that the equipment in operation at our L’Amalí and Olavarría plants is in optimal condition to avoid any interruption in cement andlime production. Maintenance and optimization of the equipment is carried out periodically and is supervised by our personnel. The equipment is in goodcondition and operational. Our L’Amalí and Olavarría plants have facilities such as maintenance workshops, warehouses, laboratories, administrative offices, and cement andlime production lines that support production. La Pampita y Entorno Quarry The La Pampita y Entorno quarry have been operating for 25 years. The material extracted from the quarry is exclusively used to supply ourplants. The amount of limestone to be mined is planned annually as part of our overall mining plan. We believe that the equipment in operation at the La Pampita y Entorno quarry are in optimum condition to maintain continuity of operations.Maintenance and optimization of the equipment is carried out periodically and is supervised by the operator of the quarry. The equipment is in good conditionand operational. Facilities The La Pampita y Entorno quarry has facilities such as offices, an electrical substation, a maintenance shop, a lubricant warehouse, a gas station,an oil tank, a guardhouse, a limestone field, a dining room, a laboratory, a truck scale, an ore belt, a loading tunnel, a meteorological station, a safety trench anda septic tank. The book value of L’Amalí and Olavarría cement plants and the La Pampita y Entorno quarry, taking into account all of the above factors,amounts to Ps. 780,376 million as of December 31, 2024. Property Encumbrances We do not make any payments with respect to any significant encumbrances for the L’Amalí and Olavarría plants, and the La Pampita y Entornoproperty. The La Pampita y Entorno mining operations currently have no outstanding payments with respect to infractions and penalties. Geology The La Pampita y Entorno quarry is located in the Tandilia System, a mountain belt which is geomorphologically composed of three main groupsof small hill ranges surrounded by plains. The basement of the Tandilia System is made up of granitic complexes and sedimentary rocks of various ages.Calcareous formations are useful materials for the conformation of the raw material used in the cement industry. The contributions of CaCO3 from thecalcareous levels allow a mining process suitable for the industry. 47
Page 57
Table of Contents The figure below shows the stratigraphic column of the area of the La Pampita y Entorno quarry, as well as a geological model of the quarry. Geological Model of La Pampita y Entorno Quarry Reserves The table below sets forth the categories and quality of the mineral reserves of the La Pampita y Entorno operations. Summary of Mineral Reserves as of December 31, 2024 Amount Grades/ qualitiesGrades/ qualitiesGrades/ qualitiesGrades/ qualitiesCut-off grades (Million Tons) (% SiO) (% Fe2O3) (% Al2O3) (% CaO) STC Proven mineralreserves. 575.8 11.3 1.6 0.9 47.4 139.1 Probable mineralreserves 35.3 11.7 1.7 0.9 47.1 133.5 Total mineral reserves 611.1 11.3 1.6 0.9 47.4 138.8 Note: All reserves are estimated as quantities at cement plant. 48
Page 58
Table of Contents For evaluation purposes, information from exploration activities from previous years has been used and is the database for the reserves model. The reserve estimation considered the quality restrictions of limestone received in L'Amalí and Olavarría cement plants, accessibility to thereserves, economic factors and modifying factors. A life of mine of 122 years has been calculated for the quarry, based on the exploitation of the last five years. Considering the maximum capacityof the plants supplied by the quarry, the life of mine would be 66 years. The following table includes a reconciliation of reserves at the end of the last two fiscal years. Reserves for the Last Two Fiscal Years Expressed in Millions of Tons* Reserves as ofDecember 31, 2023Reserves as ofDecember 31, 2024Discrepancy (Million Tons) Proven reserves 579.8 575.8 3.9 Probable reserves 35.3 35.3 0 * The per-ton price assumed for the Mineral Reserves estimation in the economic model is 93 US dollars per ton. All reserves are estimated at cement plant. The average price is93 US dollars per ton of cement, average of a 63-year projection, at nominal values. The discrepancy of 3.9 million tons (0.7%) in the proven reserves corresponds to the lime consumption for the 2024 period. Development of the Property Activities Not applicable. Internal Controls for Reserves Disclosures We conduct annual operational governance, checking our mineral reserves and reviewing new production volumes and geologic aspects to maintain highsafety standards and sufficient volume to guarantee our production without overburdening our activities. We have implemented controls and procedures designed for quality assurance and quality control on the company’s production activities and associatedinformation for the estimation of mineral resources and reserves. The quality assurance and quality control measures are applied to quarry production and cement plant processing activities. We apply industry standardsto evaluate the reliability of laboratory results that analyze exploration samples used in calculating mineral reserve estimates, which are then analyzed andverified annually by other business units within the company. Internal personnel also verify the data resulting from analysis prior to using it in their work. Additionally, we have implemented internal controls designed to ensure its mineral resources and reserves estimates are compliant with Regulation S-KItem 1300 requirements, including the preparation of reserve estimates by “qualified persons” and others on the matter in the different locations where weoperate. Energy Sources We maximize the efficiency and flexibility of our operations by utilizing multiple energy sources in our production processes, which can be usedinterchangeably depending on price levels and supply adequacy, such as thermal energy and electrical power. Additionally, since the incorporation of the secondline at the L'Amalí plant in 2021, which increased our capacity, we have been able to prioritize the operation of our kilns during periods when natural gas iswidely available for industrial consumption at lower prices, minimizing the impact of higher winter costs. Regarding electricity consumption, 73% of ourcement is produced in vertical mills, which feature superior technology compared to cement ball mills and enable us to achieve very low electrical consumptionvalues. (1) (1) 49
Page 59
Table of Contents Energy is the largest single cost component in the production of cement and accounted for 21% of our total cost of sales in 2024 and 24% and25% in 2023 and 2022, respectively. Thermal Energy Thermal energy is our most utilized source of energy for our operations having accounted for 13% in 2024, 16% in 2023 and 16% in 2022, of ourtotal cost of sales. Thermal energy is comprised of natural gas, mineral coal and petcoke, co-processing, and fuel oil (See “Co-processing”). Natural gas andpetcoke are the most significant of these energy sources. Thermal energy cost is strongly impacted by the volatility of the price of natural gas and theinternational price of oil. Since 2006, we have diversified our fuel matrix in our main plants, so that we can optimize it at all times according to the cost of eachenergy source. This great versatility allows us to capture a very competitive price on the market. Historically, given the shortage of natural gas in wintertime the energy matrix of our kilns migrates to solid fuels. Currently, this flexibility tooperate with different thermal energy sources, allow us to benefit from potential low thermal energy prices. In addition, our capacity surplus gives us moreflexibility to manage our production scheme in order to minimize the impact of winter energy costs. To ensure the supply of gas, we entered into supply contracts, for different volumes and basins, with producers (including YPF, Total Austral,Tecpetrol and Pluspetrol), and marketers and distributors,such as Ecogas – Distribuidora de Gas del Centro S.A., Gas Meridional, Trafigura, Metroenergía, GasPatagonia and Camuzzi. All these contracts have expirations between April 2025 and 2027. In 2022, the price of our thermal energy inputs was affected by the extension of the governmental incentive program (Gas.Ar Plan) for natural gasproducers, as well as the ongoing Russia-Ukraine war, which primarily impacted the prices of alternative fuels such as LNG, gas oil, coke, and fuel oil. In 2023,prices began to normalize, allowing the company to capture part of this decrease, which had a positive impact on our operating results. In 2024, the decline inactivity levels during the first months of the year led to a significant drop in natural gas market prices. The cost of petcoke varies in accordance with international market prices, which are quoted in U.S. dollars and fluctuate depending upon thesupply and demand for oil and other refined petroleum products. During 2021 and 2022, prices have been increasing due to the growth of economic activity andthe global energy crisis, reaching levels prior to the COVID-19 pandemic, and reaching historical highs. In 2023 and 2024, prices had significant dropsalthough they are still above the price of natural gas. Nevertheless, the incidence of solid fuels in our costs has been decreasing, since we reached a thermalmatrix where natural gas prevails as the main source of thermal energy. Electrical Power Electrical power is one of the main drivers of our cost structure and represented 8% in 2024 and 8% and 9% in 2023 and 2022, respectively, of ourtotal cost of sales. Electrical power cost is highly influenced by the policy implemented for fuels used in electrical energy generation and by the growing share ofthermal power generation in the electric matrix in Argentina. Currently, Argentina's energy system remains constrained by technical operating limits, particularly in transportation and distribution, due to alack of investment. This is mainly a consequence of past government price policies focused on residential demand subsidies, which are still in place. In 2024,price signals were introduced that will contribute to strengthening the electrical system in the medium term. In Argentina, the energy demanded that equals the level of consumption in 2005 is marketed by National Administrator of the Electric System(Compañía Administradora del Mercado Mayorista Eléctrico), or CAMMESA, approximately 60% of our demand. Since 2005, it was possible to contract therest of the consumption (approximately 40%) through private contracts. Since 2018, through Law No. 27,191, we were permitted to contract renewable energyfor up to 100% of our demand. We have entered into annual contracts with Pampa Energía S.A. for the supply of approximately 45% of our current electrical power requirements.Additionally, in 2024 we covered 58% of our current electrical power requirements with renewable energy sources, overachieving the percentage stipulated bythe Law No. 27,191. 50
Page 60
Table of Contents Pursuant to the Law No. 27,191, consumers with a demand higher than 300kW are required to source a minimum level of their electrical powerdemand from renewable sources pursuant to the requirements set forth by the Law No. 27,191 equal to 8% by December 31, 2017, 12% by December 31, 2019,16% by December 31, 2021, 18% by December 31, 2023 and 20% by December 31, 2025; provided that any consumption of renewable energy for higherlevels as of each cut-off date cannot be reduced in the following periods. For purposes of complying with these minimum level requirements of renewableenergy, the consumers have the option to enter into individual power purchase agreements (PPAs) with renewable energy generators, marketers or distributors,or to buy the energy through CAMMESA. In 2016, we signed a 20-year contract with Genneia S.A., and in 2018, a 20-year contract with Aluar Aluminio Argentino S.A.I.C. to enhance theuse of green energy in a cost-efficient manner. Through these contracts, we not only met the legal requirements but also exceeded them. In 2024, we signedadditional short-term contracts that allowed us to achieve the aforementioned value. Co-processing Co-processing is the final disposal of waste (agricultural, urban and industrial waste) by its integration in the process of cement production as asecondary raw material or alternative fuel, as a source of energy. Co-processing is a technique used for permanently eliminating waste without generatingenvironmental liabilities, harnessing the energy and/or mineral potential of the material. Co-processing uses duly prepared waste at different stages of the production process as a substitute for natural raw materials and/or fossil fuels.The replacement of fossil fuels and raw materials with waste provides us with a dual advantage: (1) it allows us to meet thermal and non-renewable naturalresources requirements in our production process; and (2) it presents a recognized benefit by disposing of waste that otherwise would have been deemed to beharmful and of environmental concern. This process is conducted safely, monitored and environmentally correct, with quality assurance of the cement produced. We have utilized thehighest industry standards and technological advances in developing our co-processing operations to ensure safety and efficiency. In order to reinforce our commitment to sustainability, three of our plants are prepared for co-processing. The products we co-process are mainlymunicipal solid waste, or MSW, refuse-derived fuel, or RDF and shredded solid waste, or SSW. At the end of 2019, we obtained the authorization to co-process the rejection of the urban waste, leading in Argentina the use of this waste streamin the co-processing. During 2020, we developed the use of new alternative fuel streams. In Buenos Aires, we are making progress with the co-processing ofscrap tires, actively promoting the use of this type of waste in cement kilns. Sales, Marketing and Customers We are supported by a commercial, sales and marketing team of more than 64 people focused on attending our customers’ needs. This teamincludes the technical center Loma Negra, focused on quality control, research and development of new products and technical support for clients. We servemore than 1,000 clients in Argentina through our dedicated sales teams. In the Greater Buenos Aires and the City of Buenos Aires area, our sales team isorganized by customer category, namely distributors, concrete companies, industrial and construction companies, and public sector entities. Outside the GreaterBuenos Aires and the City of Buenos Aires area, sales teams are organized by geographical region. We have long-term relationships with many of our customers, with approximately 65% of our customer base (representing over 77% of our totalcement shipments) operating under long-standing, exclusive relationships. No single customer represents more than 6% of our total net sales, while our top 20clients represented approximately 42% of total cement volume sold during 2024. We have also built a diversified customer base by sectors. Over the years, we have thoughtfully built a network of small- and medium-sized distributors throughout Argentina, and which we cultivatethrough a wide range of customer relationship programs, such as training and technical assistance, aimed at improving loyalty and customer service quality. Webelieve that we have forged, over a long period of time, a strong client relationship based on prioritizing service and product quality. In 2024, 64% of our totalcement sales 51
Page 61
Table of Contents were made directly to our wholesale distributors, 26% to concrete producers, 6% to industrial customers and 3% to construction companies and others. As a consequence of the activities in which we engage, our transactions do not have a significant cyclical or seasonal character. Nevertheless,during the second half of the year, historically the volume of sales in Argentina has shown a slight increase. Since our inception, we have developed and expanded our product range, tailoring different mixtures and product lines for a wide variety of usesand client needs. We provide our clients with customized construction solutions with superior quality, proven reliability and uniform performance. We believethat, by educating retailers and end-consumers of these attributes of our products, we have been successful in building demand and realizing higher margins forour differentiated product offering. Client Loyalty Throughout the years we have implemented a wide range of relationship programs focused on improving customer loyalty. Our average client is amedium-sized family-owned company mainly focused on the commercialization of cement, masonry and lime. We offer our customers technical support on a range of areas, including shops decoration, and even issues related to their business continuity. Technical Assistance We offer technical and post-sales support to customers, focusing on enhancing each customer’s capacity. In order to provide this service, we haveseveral technical advisers who are available for different customer segments, technical visits, workshops, seminars and in site demonstrations. Marketing Efforts We are expanding the scope of our brand image strengthening campaign, adding more points of sale and improving the image of the distributioncenters of our clients and consolidating the participation of our brand in the main soccer matches of the Argentine Championship, reinforcing our brand as asynonym of cement in Argentina. Distribution We have a distribution system aimed at providing the broadest product range in Argentina’s most important cement markets, particularly in theGreater Buenos Aires and the City of Buenos Aires area. Our strategy has been to base our sales and marketing efforts on our brand name recognition, broadproduct portfolio, customer service, efficient and timely delivery and technical support We divide our distribution platform into six regions: Buenos Aires, Central, Northwestern, Northeastern, Patagonia and Cuyo. Each of theseregions is served by our production facilities. LomaSer, our mixing, distribution and logistics facility is the center of our Buenos Aires’ distribution complex, orthe Buenos Aires Complex. Our Buenos Aires Complex serves the main market of the Greater Buenos Aires and the City of Buenos Aires area and providesbackup supply to other regions in the rest of the country. The Province of Buenos Aires is our principal market representing 44% of our total volume sold in2024. Our cement plants generally serve the geographic regions in which they are located. The table below shows the total market sales in each ofArgentina’s regions as a percentage of total volume sold in Argentina in 2023, which is the latest annualized information available at the date of this annualreport. Sales of Cement in Argentina The table below sets forth the aggregate sales of cement in Argentina during the year ended December 31, 2023: 52
Page 62
Table of Contents Region Sales CumulativeSales (in percentages %) Buenos Aires 41 41 Center 22 64 Northwest 12 76 Northeast 9 85 Cuyo 8 93 Patagonia 7 100 ________________ Source: AFCP. Since December 31, 2021, AFCP does not publish sales information per region on a monthly basis. Additionally, as of the date of this annual report, AFCP hadnot published sales information for the year ended December 31, 2024. LomaSer is located approximately 50 kilometers from the City of Buenos Aires. Due to its close proximity to this important market and its mixingand bagging capacity, LomaSer enables us to respond quickly to our clients’ cement needs. For example, LomaSer has the capacity to deliver bagged or bulkcement to locations in the Greater Buenos Aires and the city of Buenos Aires area designated by its customers within 24 hours from the time a customer placesits order. In addition, LomaSer is linked to our other production facilities via the Ferrosur Roca freight railway and is able to mix cement on-site that it receivesfrom our other plants (L’Amalí, Barker and Ramallo). Argentina’s Central Region is mainly served by our Buenos Aires Complex. The Northwest area of the Patagonia region is served from our Zapalaplant. The San Juan plant supplies demand from Cuyo, while Catamarca serves the Northwestern region of Argentina. The Northeast region is serviced by our Catamarca plant, through our Resistencia distribution center. The Litoral area is serviced through ourBuenos Aires Complex and our Paraná distribution center. In addition, we operate the Ferrosur Roca freight railway network, which extends from the northeastern region of the City of Buenos Aires toseveral other regions of the country. Of the total distance of 3,100 kilometers that are part of this railway concession, approximately 2,000 kilometers arecurrently operational. We use the Ferrosur Roca freight railway network to ship our products and raw materials, as it is connected directly to five of our plants.In addition, third parties have access to this railway network in which we charge them freight railway fees to ship their goods. Note 5 to our consolidated financial statements disclose the sales' breakdown for each of the last three fiscal years. Our Subsidiaries The following chart shows our principal subsidiaries, including our direct or indirect equity ownership interest in each of them and their main businessactivities as of the date of this annual report: Subsidiary Equity OwnershipInterest (%) Main activity Ferrosur Roca S.A. 80.00 Rail freight Recycomb S.A.U 100.00 Waste recycling ________________Indirect ownership (through Cofesur S.A.U., in which we have a direct 100% equity ownership interest). Below is a brief description of our principal subsidiaries, all of them incorporated in Argentina. Ferrosur Roca S.A. Through our subsidiary, Cofesur, we indirectly control Ferrosur Roca, a company that holds a concession to operate the Ferrosur Roca freightrailway network, a 3,100 kilometer railway that runs from the northeastern region of the City of Buenos Aires to several other regions of the country and that isstrategic to our business as it is linked directly to five of our plants (Ramallo, Olavarría, Barker, Zapala and L’Amalí) and also our LomaSer production anddistribution (1) (1) 53
Page 63
Table of Contents center. We own the total capital of Cofesur, which in turn owns 80% of the total capital of Ferrosur Roca. As of December 31, 2024, Ferrosur Roca had 1,028employees. On March 8, 2018, Ferrosur Roca duly filed before the Ministry of Transport a request for an extension of the term of validity of the concessionfor ten more years. The Ministry responded on March 20, 2019, informing Ferrosur Roca that the Special Commission created by Decree No. 1027/2018 wouldbe in charge of the renegotiation of the concession agreement, and that such process will include the analysis of the concession term extension in order toenable the implementation of the open access scheme. On November 3, 2020, the Ministry of Transport issued the Resolution No. 248/2020 to remove the Lobos-Bolívar railway branch of the GeneralRoca line in the province of Buenos Aires (from km. 98,760 to km. 330,457) from the scope of the railway concession granted to Ferrosur Roca in 1992. In accordance with Resolution No. 211/2021, published in the Official Gazette on June 28, 2021, the Ministry of Transport rejected the extensionof the term of the concession requested by different companies such as Ferrosur Roca. In that sense, Ferrosur Roca’s concession was due to expire in March2023. Later on, the CNRT approved the registration of Ferrosur Roca as “Railway Operator” in the National Register of Railway Operators (ReNOF, as per itsacronym in Spanish) by the enactment of Disposition No. 122/2022, published in the Official Gazette on February 25, 2022. Notwithstanding, on December 28, 2022, the Argentine Ministry of Transport issued Resolution No. 960/2022, extending the term of theconcession by 18 months from March 10, 2023 to September, 2024. Such term was again extended by the Ministry of Economy on October, 2024 by means ofResolution No. 991/2024 until September 10, 2025. However, the extension may be revoked at any time, with or without cause, and Ferrosur Roca will not beentitled to receive or claim any compensation if the decision to revoke the concession is taken before September 2025. As of February 26, 2024, the Ministry of Economy is the new authority empowered to carry discussions or proceedings regarding the execution ofResolution 211/2021. According to Decree 195/2024, the Ministry of Economy is the authority entitled to participate in negotiations and modifications of publicworks and services contracts on railway infrastructures Law pursuant to No. 27,132. We understand that, at the end of its concession, we will continue to provide the cargo transport rail services currently providing but as a cargooperator under the terms set forth in Resolution No. 211, Law No. 27,132, and Decree No. 1027 dated November 7, 2018. We have reassessed all accountingestimates associated with the end of the current concession. No significant impact is expected to date. We will continue monitoring the new regulations as theycome into effect, as well as the progress of ongoing negotiations with the National State and will record any related effect as soon as it is possible to make anestimate. See more information related to this issue in Note 36 to the consolidated financial statements as of December 31, 2024. See risk factor “Item 3.D—Risk Factors—The early termination of our railway concession may have a material adverse effect on our business”for further information. Recycomb S.A.U. We own 100% of the total equity capital of Recycomb, a company that was founded in 1995. Recycomb operates a blending facility for recyclingindustrial waste into alternative fuel sources. This blending facility has an annual production capacity of 106,000 tons (30,000 tons of liquid waste-derived fuel,36,000 tons of solids waste-derived fuel and 40,000 tons of shredded solids waste-derived fuel) and has been operational since the end of 1996. As of December31, 2024, Recycomb had 35 employees. Information Technology We believe that an appropriate information technology infrastructure is important in order to support the growth of our business. Our datacollection processes and software allow us to accurately monitor the processes at our various facilities, ensuring consistency and enabling us to adjust quickly inthe event of any variations. Furthermore, our enterprise resources planning model and services allows us to develop production, sourcing and pricing modelsbased on anticipated consumer demand. 54
Page 64
Table of Contents In addition, we have license agreements involving intellectual property rights with several companies, such as Microsoft, SAP, Adobe and Aveva. Insurance We maintain insurance policies against damages to third parties, with coverage and conditions comparable to those of companies engaged insimilar businesses in Argentina, respectively. We maintain insurance policies with reputable insurance companies, covering property loss and businessinterruption risks to our plants, equipment and buildings for partial or total damages or losses. The coverage for total loss or damage is for an insured value thatwe have established using as a reference the replacement value of each plant’s kiln, which is the main asset subject to risk, as we consider the total destructionof any of our plants as unlikely. For partial loss or damage, we are insured for the value at risk. As of December 31, 2024, the aggregate value at risk of ourplants was approximately US$ 1,494,572,633. These policies have a deductible of US$ 250,000 per claim. For loss of profit derived from material damages thecoverage is 21 days. We have not made any material claims on our insurance policies in recent years. Sustainability and Social Responsibility At Loma Negra, we strive to create value for our shareholders while also minimizing the environmental impact of our activities and making apositive contribution to society. Three principles drive our practices in the markets in which we operate, under the Triple Impact concept, promoting economicgrowth, social contribution and environmental care, in harmony with our communities. Following these principles, we plan to continue to develop as a world-class company and operate our business in accordance with the principles of sustainability. These principles prompted us to prepare our third edition of the Sustainability Report, thus confirming our commitment to communicatetransparently and annually the impacts of our Company on the economy, the environment and people, including human rights. This report is available on ourwebsite. We are part of social, environmental, educational, economic and cement industry organizations, with whom we share principles and values thathelp us develop in line with the best market practices. We actively participate in the Argentine Business Council for Sustainable Development (CEADS). Weare part of the program "Connecting companies with SDG" and we participate in the Working Groups on Climate and Energy, Environment and Regulation, andSociety and Business. For its part, we also formed the Sustainability Commission of the Association of Portland Cement Manufacturers (AFCP), where wecontribute to developing and promoting initiatives that contemplate sustainable development and benefit the community, preserve the environment and promotethe efficient use of energy from renewable sources in our country. The main guidelines of our environmental management emerge from our purpose, values, principles and Integrated Management Policy: thereduction of the carbon footprint as a transversal and systemic axis of action, which drives our work to promote the circular economy, diversification of ourenergy matrix, and the adoption of the best practices in the industry, such as the efficient use of supplies and raw materials, the recovery of energy and wastematerial (own and from other industries), the management of GHG emissions, and the sustainable management of water, quarries and natural environments. Through our Environmental Management System (EMS) we integrate the key mechanisms to improve performance in relation to theEnvironment. Likewise, internal and external audits are carried out annually at each plant under internationally recognized standards such as ISO 14001,Environmental Management Systems. Our standards adopt as a basis the main environmental guidelines of the industry at an international level, following the guidelines of the GlobalCement and Concrete Association (GCAA), previously known as Cement Sustainability Initiative (CSI), of the World Business Council for SustainableDevelopment (WBCSD). Likewise, guided by our values and principles, we believe that we contribute to the Sustainable Development Goals (SDG) throughour environmental and social sustainability initiatives, the promotion of the circular economy and the reduction of the carbon footprint. In terms of climate action, the GCCA announced, at an international level, the commitment to reduce the carbon footprint generated in operationsand products, as well as the aspiration to offer society neutral concrete by 2050 (this includes the objective of reducing greenhouse gas emissions and usingalternative materials and fuels to improve the 55
Page 65
Table of Contents efficiency in the use of energy necessary for the production of cement, diversifying the energy matrix in sustainable way). Under these guidelines, at LomaNegra we believe that we promote the circular economy, adopting the best practices in the industry, such as the co-processing technique for energy recovery andwaste material and the reduction of the clinker factor. We develop comprehensive waste management, prioritizing the minimization of waste at source, as well as its reuse and recycling. Within theframework of these objectives, our practices focus on co-processing, a technique that allows us to transform our own waste, derived from other industries orgenerated by the community, into raw materials and alternative fuels that we use in the manufacture of cement. In this way, we contribute directly to thesustainable management of waste and provide a solution for one of the main problems of our society. Since the production of cement requires intensive use of thermal and electric energy, the optimization of these resources is our top priority. The optimization of thermal and electrical energy is a priority objective for our operating system. To do this, we have a specific area, within thescope of the Supply Chain and Alternative Fuels management, which is in charge of both the management of contracts with suppliers and the distribution ofconsumption by plant, prioritizing the most efficient units in our productive scheme. We also moved forward with the implementation of actions of thePerformance Industrial Program. Furthermore, we opt for the use of renewable energies as an alternative to traditional energies from fossil fuels; and we promote co-processingthrough the use of alternative fuels, a practice that is part of our sustainable business strategy embodied in our 2030 Climate Roadmap that was done during2023 through the creating of inter-area and interdisciplinary teams with the purpose of continuing working on a portfolio of ideas, solutions and investmentsrequired to achieve the reduction goal set for 2030. In 2024, 57.5% of our electricity came from renewable sources, and 4.26% of the thermal energy used in our kilns came from alternative fuels,replacing traditional fossil fuels. In this way, compared to 2023, a reduction of 907,347 t CO2e was recorded, in line with the implementation of the plannedactions for the period according to the Climate Roadmap across the four dimensions. Also, there was an increase in the fuel mix and a decrease in the clinkerfactor, meaning a higher proportion of additions in the cement. Additionally, in terms of environmental sustainability, during 2024 we made progress on the development of “Product Carbon Sheets” (PCS) forour CPC40 product from LomaSer and CPN40 and CPN50 from L’Amalí, following the ISO 14067 standard. A 31% reduction in water extraction volume wasrecorded, and 84% of the total waste generated during the period was recovered. The Loma Negra Foundation embraces the significant challenge of integrating community engagement with our business strategy. We strive toensure the sustainability of the entire ecosystem through trust based alliances that positively impact the communities where we operate and enhance the well-being of our employees. We implement a model of active participation and joint action between the public and private sectors and social organizations. Inaddition, we promote the generation and strengthening of the installed capacities of the actors present in the communities (base development), promoting co-responsibility in the execution of initiatives. This collaborative framework promotes consensus building, prioritized action planning, and shared managementwith social entities, government agencies, academia, and businesses, each contributing their unique strengths and capabilities. Aligned with our CorporateSocial Responsibility guidelines, the Private Social Investment model allows us to sustain the long-term development of programs in various communities inthe country, based on different platforms for engagement and support. In line with the United Nations Sustainable Development Goals (SDGs), our programs directly address issues that impact the target communities. 1. Bridge Program: Our purpose is to increase considerably the number of young people and adults with the necessary skills, particularlytechnical and professional, to access employment and decent work. We contemplate two lines of action to achieve this: job skills and educational improvement. 2. Commitment Program: We promote the constitution of transforming alliances in the public, private and civil society spheres, activelyinvolving our collaborators in the advocacy communities. We develop volunteer projects and initiatives for the development of social capital based on theinstitutional strengthening of grassroots organizations. 56
Page 66
Table of Contents 3. Roots Program: We seek to contribute with policies aimed at the development of productive activities, decent job creation, entrepreneurship,creativity and innovation. We also encourage the formalization and growth of micro-enterprises through access to financial services, as well as the generation ofinclusive businesses. 4. Transform Program: With a focus on habitat, we seek to mobilize the investment capacity of large companies in lucrative businesses,articulating alliances with NGOs and communities, with the aim of building innovative approaches aimed at creating opportunities for the base of the pyramid,offering innovative solutions to social, environmental and economic problems. The company's Sustainability Report for the year 2024 is available on our website at https://www.lomanegra.com/en/sustainability/ . The contentsof the company's website, including the Sustainability Report, are not part of or otherwise incorporated by reference into this annual report. For information related to the potential risks we are subject to due to changes to environmental requirements and the effects of climate change, see“Item 3 – Key Information—Risk Factors—Risks Relating to Our Business and Industry—Climate change and climate change legislation or regulations mayadversely affect our business.” Competition Cement Following the consolidation of the cement industry in Argentina during the 1990s, LafargeHolcim, an international cement company, through itsacquisition of Juan Minetti S.A. and Corcemar S.A., two Argentine cement producers. Other Argentine cement producers include Cementos Avellaneda S.A., orAvellaneda, a company controlled by Cementos Molins, S.A. and Votorantim Cimentos S.A., and Petroquímica Comodoro Rivadavia S.A., or PCR. Given thehigh cost of transporting cement, our competitors are generally limited in competing in the regions where their production facilities are located. We are the onlycement company in Argentina with production facilities located in several regions of Argentina and with nationwide reach. The chart below sets forth the estimated cement market share in Argentina during 2024 for our company, Cementos Avellaneda, Holcim Argentinaand Petroquímica Comodoro Rivadavia. Source: AFCP and Loma Negra. Each of Argentina’s main cement companies have developed market strengths in specific areas driven primarily by the location of their facilitiesand their geographic focus resulting from high transportation costs which limit 57
Page 67
Table of Contents their ability to compete effectively over long distances. We are the only Argentine cement company to have nationwide coverage, as our facilities are locatedthroughout the country, with particular focus on Argentina’s most important market, the Province of Buenos Aires. Our cement plants generally serve thegeographic regions in which they are located. Holcim Argentina S.A. has a strong market position in the provinces of Córdoba, Mendoza and Jujuy. In recent years, our main competitors executed investments to expand their production capacity. According to available public information,Holcim Argentina S.A. expanded the “Malagueño” plant, located in the province of Córdoba. In the case of Avellaneda S.A., a similar expansion in the “ElGigante” plant in the province of San Luis has been finished in late 2020 and is operating. In December 2021 we inaugurated the second line of L’Amalí plant, which allowed us to increase our capacity, adding approximately 3 milliontons annually, and transforming L’Amalí in one of the biggest cement plants in South America. Concrete We participate in the concrete market under our Lomax brand. We have operations in the two main concrete markets of Argentina: (1) the City ofBuenos Aires and the Greater Buenos Aires area; and (2) the city of Rosario. The Olavarría region is the main supplier of granitic aggregates consumption forthe Greater Buenos Aires and the City of Buenos Aires area. We also lead this dynamic and high potential growth market through a group of selected medium- and large-sized concrete companies that havebeen exclusive and loyal clients of Loma Negra for many years. Legal and Regulatory Matters Environmental Regulations We develop our business in a responsible and sustainable manner, with a commitment to continuous improvement of environmental performance,minimizing the environmental impacts of our operations and providing the maximum value for society. From the point of view of compliance, this visionincludes respect for environmental legislation and good relations with our stakeholders. Regarding legal requirements, we have a system for identifying, updating and evaluating environmental requirements, which is managed throughan online system in all our plants and business units. In addition, we have a registration and monitoring system for environmental inspections, notifications andpresentations, where the requirements of the enforcement authorities in environmental matters are managed, including possible fines and sanctions, and wherethe presentations made by the company are also recorded, accrediting due compliance. In 2023 and 2024, no significant monetary or non-monetary fines orsanctions were recorded for non-compliance with environmental laws or regulations. Considering that emissions are one of the significant impacts of our activity, it is important to note that we implement Annual EnvironmentalMonitoring Plans (PAM-A) and we hire environmental analysis and monitoring laboratories authorized by the environmental agencies in each jurisdiction,complying with all current regulations governing emissions and air quality to ensure the protection of the atmosphere and the environment. Mining Regulations We extract limestone from quarries that we own, and quarries owned by third parties. The main statute that governs mining in Argentina is theArgentine Mining Code, which was enacted by Law No. 1,919 of 1886, as amended. The Argentine Mining Code establishes that the ownership of mineralsubstances existing in quarries, including limestone, is exclusively vested in the owner of the land where they are located and that provincial laws will regulatethe operation of quarries. The owner may mine the quarries existing in its land or leave them inactive. However, the federal, provincial or municipalgovernment where the quarry is located may declare that the exploitation of the mines is of public interest and expropriate the land where the quarries arelocated. Pursuant to the Argentine Mining Code, as amended by Law No. 24,585, which regulates environmental aspects of the mining activity, partiesinvolved in certain mining activities are required to file, prior to the commencement 58
Page 68
Table of Contents of mining activities on a tract of land, an environmental impact evaluation report with the relevant regulatory agency for its approval. If approved, the relevantregulatory agency issues an environmental impact declaration, which must be renewed every two years. C. Organizational Structure The following organizational chart sets forth our simplified corporate structure as of the date of this annual report: ________________Loma Negra has an indirect ownership in Ferrosur Roca S.A. through Cofesur SAU, in which we have a direct 100% equity ownership interest. CofesurSAU has a direct 80% equity ownership interest in Ferrosur Roca S.A. D. Property, Plants and Equipment Our Production Facilities As of December 31, 2024, we owned seven cement manufacturing plants in Argentina: Barker, Catamarca, L’Amalí / LomaSer, Olavarría,Ramallo, San Juan, and Zapala, fourteen concrete plants operating under the Lomax brand and one granitic aggregates plant. (1) 59
Page 69
Table of Contents The following table sets forth information regarding our production facilities, as of December 31, 2024: Production Facility Type of Plant Location CommissioningYear Argentina: North-east: Resistencia Warehouse Resistencia 2013 Center-east: Barker Cement Benito Juárez 1956 L’Amalí Cement Olavarría 2001/2021 LomaSer Blending/Distribution Cañuelas 2000 Olavarría Cement Olavarría 1929 Ramallo Grinding Mill Ramallo 1998 Paraná Warehouse Paraná Patagonia: Zapala Cement Zapala 1970 Cuyo: San Juan Cement San Juan 1963 Mendoza Warehouse Palmira 2020 North-west: Catamarca Cement El Alto 1980 Salta Warehouse Salta 2020 Concrete plants under the Lomax brand: Don Torcuato Concrete Greater BuenosAires area 1998 Sola Concrete City of Buenos Aires 1998 Llavallol Concrete Greater BuenosAires area 1998 Uriburu Concrete Rosario 2010 Darsena F 1 Concrete City of Buenos Aires 2017 Darsena F 2 Concrete City of Buenos Aires 2018 Vicente Casares Concrete Greater BuenosAires area 2018 Escobar Concrete Greater BuenosAires area 2020 Gonzalez Catan Concrete Greater BuenosAires area 2022 Berazategui Concrete Greater BuenosAires area 2023 Fatima Concrete Greater BuenosAires area 2023 Olavarría Concrete Buenos Aires Province 2023 Punta Alta - Movil Plant Concrete Buenos Aires Province 2024 MSU Rufino - Planta Movil Concrete Santa Fe Province 2024 Aggregates plant: La Preferida Aggregates Olavarría 2004 60
Page 70
Table of Contents The map below presents the location of our facilities: Barker The Barker plant began operations in 1956 and is located in the City of Benito Juárez, Province of Buenos Aires. The Barker plant currently hastotal annual cement and filler production capacity of approximately 1.3 million, using one dry-process kiln. The Barker plant has capacity to produce cementand also produces filler, which is used for cement mixing by LomaSer. In the context of the L’Amalí expansion project, and considering the actual demand,during 2019 we decided to reconvert our Barker and San Juan plants, transforming both full cement lines into grinding and distribution centers, and we haveadapted our cost structure to reflect this new scenario. Catamarca The plant of Catamarca began operations in 1980 and is located in the City of El Alto, Province of Catamarca. The Catamarca plant, which uses adry-process kiln, has annual installed cement production capacity of 2.2 million tons. This plant has modern automation technology and is equipped with pre-heating equipment. It also features automated quality control systems, which enhance the reliability of its finished products. The Catamarca plant produces cement, as well as masonry cement. It serves the Province of Catamarca and certain neighboring provinces andregions. L’Amalí The L’Amalí plant is located approximately five kilometers from our Olavarría plant, Province of Buenos Aires, where our largest limestonereserves are located, and is connected to the Ferrosur Roca freight railway. This plant, which became operational in August 2001, has an annual installedproduction capacity of approximately 4.0 million tons of clinker and approximately 5.6 million tons of cement and complies with the highest standards ofcement production 61
Page 71
Table of Contents technology and applicable environmental requirements. The plant uses natural gas and solid fuels, together with alternative fuels from Recycomb. See “ —Investments” for more information regarding the expansion of the L’Amalí plant”. The L’Amalí plant has mobile equipment to extract and crush limestone mined from a quarry located nearby. The quarry is linked to the plant by aconveyor belt transporting system. The L’Amalí plant has two kilns to produce clinker with a daily capacity of approximately 12,000 tons and cementproduction, storage and bulk loading capabilities. For the cement production, the plant has two ball mills of 135 tons per hour each one, and one vertical millthat produces approximately 500 tons per hour, as well as storage and bulk loading capabilities. The plant produces both bulk and bagged cement. The last one is packed in our new packing plant which has two production lines with a capacityof 4,500 bags per hour each one. The plant also produces base cement that is used by LomaSer as a raw material for its cement production and clinker that isused by our other cement plants. See “Item 4.D Property, Plants and Equipment – Investments” For additional information in relation to our mining operations at L'Amalí plant, see "Item 4.B. Business Overview-Mining Operations Disclosure(Mineral Reserves)-Individual Properties Disclosure." LomaSer LomaSer started operations in 2000 and it is located in the City of Vicente Casares, Province of Buenos Aires. LomaSer is our blending,distribution and logistics center and includes a cement mixing plant and distribution and logistics center. It is located approximately 50 kilometers from the Cityof Buenos Aires and is connected to our plants in the Province of Buenos Aires through the Ferrosur Roca freight railway. LomaSer’s proximity to Argentina’sprincipal cement market helps us to quickly respond to client needs, providing superior and reliable delivery services at competitive costs. It also allowscustomers to maximize fleet performance and minimize cement stock requirements. LomaSer receives base cement filler and slag from the L’Amalí, Barker and Ramallo plants, respectively. These materials are stored in a multi-cellsilo, which has a total capacity of 28,000 tons Additionally, 8,000 tons of bagged cement can be stored. The silo feeds a mixer, which has an annual installedcement production capacity of approximately 2.2 million tons. The map below presents the location and connections among our facilities with LomaSer in theGreater Buenos Aires area, as well as the Ferrosur Roca freight railway network, which we use to ship our products and raw materials, as it is connecteddirectly to six of our plants. 62
Page 72
Table of Contents (1) Railroad segment we actively use. LomaSer has a flexible production facility that allows production to be switched rapidly between one type of cement to another. The ability tocustomize the blending according to each additions’ characteristic enables us to produce superior quality cement while optimizing the maximization ofadditions. LomaSer operates approximately 40% of our total cement dispatches. It ships cement in bags or in bulk depending on its customers’ needs. Olavarría The Olavarría plant began operations in 1929 and it is located in the City of Olavarría, Province of Buenos Aires. The plant currently has twoactive dry-process kilns with a kiln production capacity of approximately 0.4 million tons of lime, and a second kiln with an installed capacity of 1.0 milliontons of annual production capacity of clinker and 1.6 million tons of annual production capacity of cement. The Olavarría plant produces cement, as well as masonry cement and lime. It principally serves the Buenos Aires region. For additional information relating to our mining operations at L'Amalí plant, see "Item 4.B. Business Overview-Mining Operations Disclosure(Mineral Reserves)-Individual Properties Disclosure." Ramallo The Ramallo plant was inaugurated in 1998 and it is located in the City of Ramallo, Province of Buenos Aires. Ramallo produces cement and alsomills slag that is used by LomaSer. This plant has annual cement installed production capacity of 0.5 million tons. We acquire slag from Siderar S.A.I.C.,Argentina’s largest steel company, which is located near this plant. The Ramallo plant serves the northern portion of the Province of Buenos Aires and the Province of Santa Fe. San Juan The San Juan plant began operations in 1963 and it is located in the City of Rivadavia, Province of San Juan. It has an annual cement productioncapacity of approximately 0.4 million tons and uses a dry-process kiln. In 1993, a new facility was installed in this plant to enable it to store and process coal,enabling it to operate either using natural gas or a combination of natural gas, fuel oil and coal, together with liquid alternative fuels. The San Juan plant servesthe Province of San Juan and certain neighboring provinces. In the context of the L’Amalí expansion project, and considering the actual demand, during 2019 we decided to reconvert our Barker and San Juanplants, transforming both full cement lines into grinding and distribution centers, and we have adapted our cost structure to reflect this new scenario. Zapala The Zapala plant began operations in 1970 and it is located in Zapala, Province of Neuquén. This plant has a dry-process kiln, with annualinstalled cement production capacity of 0.4 million tons and annual installed clinker production capacity of approximately 0.2 million tons. This plant isequipped with energy-efficient wheel-type roller grinding equipment used to grind the clinker before it enters the production process. The Zapala plant produces cement. It mainly serves the provinces of Neuquén and Río Negro and exports approximately 2% of its cement toSouthern Chile. La Preferida In 2009, we commenced operations in the aggregates market in Argentina with our acquisition of La Preferida de Olavarría, which is located inthe City of Olavarría, Province of Buenos Aires. In 2018, a new crusher started to operate. This plant has annual aggregates production capacity of 2.2 milliontons. 63
Page 73
Table of Contents We sell granitic aggregates through La Preferida de Olavarría, which is responsible for approximately 44% of the aggregates consumed by Lomaxin their concrete production operations. Investments With the completion of the second line of the L’Amalí plant in December 2021, L’Amalí has become the largest cement plant in Argentina and oneof the largest in Latin America, based on annual installed cement production capacity. With the finalization of this expansion project, capital expendituresdecreased significantly.As of the date of this annual report, we have no other material investments in development or future material investments plans other than the onerelated to the legal requirement of adjusting our cement bags to the 25 kilograms format. See "Item 3.D. Compliance with Resolution 54/2018 of the Secretaryof Commerce could adversely affect our operations and profitability.” ITEM 4A. UNRESOLVED STAFF COMMENTS Not applicable. ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS The following discussion should be read in conjunction with our audited consolidated financial statements and the related notes includedelsewhere in this annual report. This discussion contains forward-looking statements that are subject to known and unknown risks and uncertainties. Actualresults and the timing of events may differ significantly from those expressed or implied in such forward-looking statements due to a number of factors,including those set forth in the section entitled “Key Information—Risk Factors” and elsewhere in this annual report. You should read the following discussionin conjunction with “Cautionary Statement with Respect to Forward-Looking Statements” and “Key Information—Risk Factors”. A. Operating Results Principal Factors Affecting Our Results of Operations Macroeconomic Conditions Our business is highly sensitive to factors such as GDP growth (globally and in Argentina, the cement industry has a strong positive correlationwith GDP growth). An economic slowdown can lead to a slowdown in the construction industry and consequently decreased cement demand and production.Likewise, an expansion of GDP is expected to drive incremental cement demand, above expected GDP growth. During 2024, according to the INDEC, the Argentine economy decreased 1.7%, after decreasing 1.6% and increasing 5.2% in 2023 and 2022,respectively. 64
Page 74
Table of Contents The following table presents key data of the Argentine economy for the periods indicated. As of and for the YearEnded December 31, 2024 2023 2022 GDP (billions of Ps.) 702.2 714.6 725.8 Real GDP growth (1.7)% (1.6)% 5.2 % GDP per capita (in thousands of U.S. dollars) 13.7 12.8 13.7 Private consumption growth (4.2)% 1.0 % 9.7 % Average Ps./U.S. dollar exchange rate 916.3 295.2 130.8 CPI inflation 117.8 % 211.4 % 94.8 % Private sector salary growth 147.5 % 165.8 % 93.8 % Unemployment rate 7.2 % 6.1 % 6.8 % ________________Sources: BCRA, INDEC and our company.(1) The average rate is calculated by using the average of the BCRA’s reported exchange rates on a daily basis.(2) As a percentage of Argentina’s economically active population. Quarterly average. Inflation Our audited consolidated financial statements comprehensively recognize the effects of variations in the purchasing power of currency through theapplication of the method to restate financial statements in constant currency established by the IAS 29. See “Presentation of Financial and OtherInformation”. Our audited consolidated financial statements as of and for the year ended December 31, 2024, including the figures corresponding to the previousfiscal year have been restated to consider changes in the general purchasing power of our functional currency (the peso) in accordance with the provisions inIAS 29 and the CNV’s General Resolution No. 777/2018. As a result, our financial statements are stated in the unit of currency that was current at the end of thefiscal year that is being reported. In accordance with IAS 29, the amounts in the financial statements that have not been stated in constant currency as of the end of the reportingperiod must be restated by application of a general price index. To that end and in the manner established in FACPCE´s Resolution JG No. 539/18, coefficientshave been applied that are calculated on the basis of indices published by the FACPCE, resulting from combining national consumer prices published by theInstituto Nacional de Estadística y Censos (the National Statistics and Census Institute), or INDEC, starting on January 1, 2017 and, looking back, domesticwholesale prices, or IPIM prepared by INDEC or, if none is available, consumer price indices published by the General Directorate of Statistics and Censuses inthe Autonomous City of Buenos Aires. The variation, in the index applied to restate our audited consolidated financial statements for the years ended as of December 31, 2024, 2023,2022, 2021 and 2020 has been 117.8%, 211.4%, 94.8%, 50.9%, and 36.1% respectively. See “Note 2.2 of our audited consolidated statements”. Foreign Currency Exchange Rate Our liabilities that are exposed to foreign currency exchange rate risk are primarily denominated in U.S. dollars. To partially offset our risk of anydepreciation of the peso against the U.S. dollar, from time to time we may enter into derivative contracts. Because we borrow in U.S. dollars in international orlocal markets to fund our operations and investments, we are exposed to market risks from changes in foreign exchange rates and interest rates. Our foreign currency exposure gives rise to market risks associated with exchange rate movements. A significant portion of our borrowings aredenominated in foreign currency. As of December 31, 2024, our consolidated foreign currency-denominated borrowings was Ps. 156,366 million, denominatedin U.S. dollars. As of December 31, 2024, we did not have foreign currency derivative financial instruments. (1) (2) 65
Page 75
Table of Contents In the event that the peso was to depreciate by 25% against the U.S. dollar as compared to the peso/U.S. dollar exchange rate as of December 31,2024, our foreign currency net liability position as of December 31, 2024 would have increased by approximately Ps. 42,031 million. Due to the foreign exchange crisis after the primary elections in August 2019, the Argentine Central Bank reinstated rigid restrictions and foreignexchange controls, for more information about said restrictions see “Item 10. Additional Information- D. Exchange Controls”. Considering the mentionedrestrictions based on the current exchange regulations applicable in Argentina, we constantly monitor the alternatives for collecting assets and settling liabilitiesin foreign currency and the related impact. The gain/loss arising from the use of financial instruments to settle transactions in foreign currency is recognizedwhen we unconditionally commit to or irreversibly executes such settlement. As of December 31, 2024, the use of financial instruments to settle the abovetransactions would result in an impact of approximately 15% as mentioned in note 32.4.1. to the consolidated financial statements as of such date. As of December 31, 2021, the official nominal exchange rate for pesos into U.S. dollars fell to Ps. 102.7500 per US$1.00, a devaluation ofapproximately 22.1% as compared to the official exchange rate of Ps. 84.1450 per US$1.00 as of December 31, 2020. As of December 31, 2022, the officialnominal exchange rate for pesos into U.S. dollars fell to Ps. 177.1283 per US$1.00, a devaluation of approximately 72.4% as compared to the official exchangerate of Ps. 102.7500 per US$1.00 as of December 31, 2021. As of December 31, 2023, the official nominal exchange rate for pesos into U.S. dollars fell to Ps.808.4833 per US$1.00, a devaluation of approximately 356.44% as compared to the official exchange rate of 177.1283 per US$1.00 as of December 31, 2022.As of December 31, 2024, the official nominal exchange rate for Ps. into U.S. dollars fell to Ps. 1032.50 per US$1.00, a devaluation of approximately 27.7% ascompared to the official exchange rate of 808.4833 per US$1.00 as of December 31, 2023. In the first three months of 2025, the peso depreciated byapproximately 3.85% against the U.S. dollar. The following table sets forth the annual high, low, average and period-end exchange rates for the periods indicated, expressed in pesos per U.S.dollar and not adjusted for inflation. There can be no assurance that the peso will not depreciate or appreciate again in the future. The Federal Reserve Bank ofNew York does not report a non-buying rate for pesos. Official Nominal Exchange Rates High Low Average Period-end 2020 84.1450 59.8152 70.5941 84.1450 2021 102.7500 84.7033 95.1615 102.7500 2022 177.1283 103.0400 130.8089 177.1283 2023 808.4833 178.1417 295.2123 808.4833 2024 1,032.5000 810.6500 916.2543 1,032.5000 2025 January 2025 1,053.5000 1,032.7500 1,043.5644 1,053.5000 February 2025 1,064.3750 1,053.9167 1,058.4625 1,064.3750 March 2025 1,073.8750 1,064.3750 1,069.0347 1,073.8750 April 2025 (through April 28) 1,200.8333 1,070.4167 1,115.7132 1,163.1667 ________________(1) Reference exchange rate published by the Argentine Central Bank.(2) Based on daily averages. Net Capital Expenditures and Other Investments In July 2017, we entered into an agreement with the Chinese company Sinoma International Engineering Co. Ltd., or Sinoma for the constructionof the second line at our L’Amalí plant. We finalized the project in December 2021, adding approximately 3 million tons to our annual installed cementcapacity. On a consolidated basis, our capital expenditures incurred in property, plant and equipment were Ps. 73,048 million during the year endedDecember 31, 2024 and Ps. 78,511 million and Ps. 69,192 million during the years ended December 31, 2023 and 2022, respectively. (1) (1) (1)(2) (1) 66
Page 76
Table of Contents Our Cost Structure The prices that we charge for our cement products are directly related to our production costs. Fluctuations in the price of our thermal energysources and electricity impact our costs of goods sold and the prices that we charge our customers for our products. Significant increases in the price of naturalgas, solid fuels or electricity and, consequently, in our production costs, could reduce our gross margins and our results of operations to the extent that we mightnot be able to pass a significant portion of these costs on to our customers and could result in reduced sales volumes of our products. Conversely, significantdecreases in the price of natural gas, solid fuels or electricity and, consequently, in our production costs, would likely increase our gross margins and our resultsof operations. Our efforts on increasing the use of co-processing (use of waste as a source of a renewable energy, to replace natural mineral resources and fossilfuels such as coal, petcoke and gas) on our production process aims to decrease both our dependency on certain energy sources and reduce costs. In 2024, thepercentage of co-processing used in our production process reached 4.3%. Thermal Energy. Our operating income has been affected by energy price changes. Energy prices may vary in the future, mainly due to marketforces and other factors outside our control. We protect ourselves from energy price inflation risks through the diversification of our fuel sources (includingsolid fuels and the use of co-processing as an alternative energy source) and our ability to transfer all or part of increased costs to our customers via priceincreases for our products. We also seek to produce different types of cement with lower clinker content, replacing it with other components such as slag,pozzolana, and limestone, which reduce our overall energy costs. Thermal energy is our most utilized source of energy for our operations, representing 13% in the year ended December 31, 2024 and 16% and16% in the years ended December 31, 2023 and 2022, respectively, of our total cost of sales. Thermal energy is comprised of natural gas, fuel oil, mineral coaland petcoke. Natural gas is the most significant of these energy sources. We enter into several contracts with suppliers, traders and distributors of natural gas.See “ —Supply Contracts”. The cost of petcoke varies in accordance with international market prices, which are quoted in U.S. dollars and fluctuate depending upon thesupply and demand for oil and other refined petroleum products. We make spot purchases of petcoke or steam coal in order to capture market opportunities inthe price of these solid fuels. During 2021 and 2022, prices have been increasing due to the growth of economic activity and the global energy crisis, not onlysurpassing levels prior to the pandemic, but reaching historical highs. In 2023 and 2024, prices significantly dropped although they were still above the price ofgas. Electrical power. Electrical power is one of the main drivers of our cost structure and represented 8%, 8% and 9% in the years ended December31, 2024, 2023, and 2022, respectively, of our total cost of sales. Electrical power is one of the most expensive energy sources that we use. Given our consumption needs and the potentially high cost of electricalpower, we have sought to mitigate the risks of supply interruptions and cost increases by contracting electrical power to private companies and entering intoagreements to increase the use of renewable energy. Electrical power cost is highly influenced by the government policy applied to fuels used in electricalpower generation and by the growing contribution of thermal power generation to the electrical power generation matrix in Argentina. In 2024, price signalswere introduced that will contribute to strengthening the electricity system in the medium term. In Argentina, approximately 60% of the current energy demand that equals the level of consumption in 2005 is marketed by NationalAdministrator of the Electric System (Compañía Administradora del Mercado Mayorista Eléctrico), or CAMMESA. Since 2005, it was possible to contract therest of the consumption (approximately 40%) through private contracts. During 2024, our matrix was 58% renewable, 37% supplied with private contracts andonly 6% was transacted as Base energy acquired from CAMMESA. Consumers with a demand higher than 300kW are required to source a minimum level of their electrical power demand from renewable sourcesequal to 8% by December 31, 2017, 12% by December 31, 2019, 16% by December 31, 2021, 18% by December 31, 2023 and 20% by December 31, 2025;provided that any consumption of renewable energy for higher levels as of each cut-off date cannot be reduced in the following periods. For purposes ofcomplying with these minimum level requirements of renewable energy, the consumers have the option to enter into individual power purchase agreementswith renewable energy generators, marketers or distributors, or to buy the energy through CAMMESA See “ —Supply Contracts”. 67
Page 77
Table of Contents In 2016, we entered into a 20-year agreement with Genneia S.A., and in 2018 entered into a 20-year agreement with Aluar Aluminio ArgentinoS.A.I.C. to enhance the use of green energy. With these contracts and other short-term contracts that we signed in 2024, we not only complied with the legallimits but also exceeded the minimum required levels. Co-Processing. During 2024 we continued with our co-processing efforts. Co-processing is the final disposal of waste (agricultural, urban andindustrial waste) through its integration in the cement production process as a secondary raw material or alternative fuel, as a source of energy. Co-processing isa technique used for permanently eliminating waste without generating environmental liabilities, by harnessing the energy and/or mineral potential of thematerial. Co-processing represented 4.3% in the year ended December 31, 2024 and 2.2% and 2.1% in the years ended December 31, 2023 and 2022,respectively, of our total thermal energy consumption. For additional information related to our thermal energy, electrical power and co-processing needs and costs, see “Item 4.B Information on theCompany—Business Overview—Energy Sources”. Preservation and maintenance costs. Our industry is capital intensive, and we incur in maintenance costs necessary to preserve the productivityand durability of our cement facilities. In the year ended December 31, 2024 preservation and maintenance costs represented 11% and in the years endedDecember 31, 2023 and 2022, represented 9% and 9%, respectively, of our total cost of sales. Freight. Our freight includes the cost of transporting raw materials to our production facilities from our quarries or the location of our suppliers. Inthe year ended December 31, 2024 freight represented 9% and in the years ended December 31, 2023 and 2022, freight represented 11% and 11%, respectively,of our total cost of sales. Salaries, wages and social security charges. Our salaries, wages and social security charges comprise mainly compensation, social contributionand employee benefits. In the year ended December 31, 2024 salaries, wages and social security charges represented 17% and in the years ended December 31,2023 and 2022, salaries, wages and social security charges represented 15% and 15%, respectively, of our total cost of sales. Raw Material Availability. Our long-term success depends in part on our ability to secure raw materials in sufficient quantities, includinglimestone, gypsum and other materials necessary for the production of clinker and cement, which are currently available to us from quarries located close to thedifferent industrial units. We generally obtain limestone from the mining of quarries that we own. In some cases, however, we may face the risk of theexhaustion of raw materials in some quarries, most notably limestone, which would require us to find new quarry sources further away from our productionunits, and result in potential materially higher raw material extraction and freight costs. In the year ended December 31, 2024 raw materials represented 19%and in the years ended December 31, 2023 and 2022, raw materials represented 18% and 15%, respectively, of our total cost of sales. Effects of Taxes on Our Income We are subject to a variety of generally applicable Argentine federal and state taxes on our operations and results. We are subject to Argentinefederal Income Tax by applying a sliding scale from 25% to 35%, depending on the accumulated net income obtained during the given year. Dividends paid toArgentine individuals and foreign beneficiaries (both individuals and entities) are subject to a 7% withholding tax made by the paying entity. We are also subject to the following federal and state taxes: • Turnover Tax. The Turnover Tax is a provincial tax and the rate applicable depends on each province. Currently, the Turnover Tax representsapproximately 1.4% of our net sales. • Quarry Exploitation Fee. Municipalities establish certain taxes that may have incidence on mining developments. Each jurisdiction in whichmining activities are developed has its particular legislation. For example, Municipalities may charge a quarry exploitation quota equivalent to the amount of limestone contained in the cement dispatchedor sold from the factory at a rate determined by each municipality. The rate is determined at a fixed amount, which is updated in a monthlybasis. This amount represented 1.4% of sales in 2024 of cement, masonry cement and lime. • Tax on Bank Accounts Debits and Credits. The general rate of the tax on bank accounts debits and credits is 0.6% for each debit and eachcredit, while an increased rate of 1.2% applies in cases in which there has 68
Page 78
Table of Contents been a substitution for the use of a bank account. Taxpayers (whether at 0.6% or 1.2% rate) may compute 33% of the amounts paid under thistax as a payment on account of the income tax. Law 27,264, in force since August 2016, establishes that micro and small sized companiesmay apply 100% of this tax as an advance payment of income tax, medium industrial sized may apply 50% of this tax as an advance paymentof income tax. Moreover, Law 27,432 establishes that the Executive Branch may increase up to 20% per year the percentage of the paymentsof this tax that can be computed for as payment on account of Argentine income tax. The government has not exercised this faculty since2018 and currently it is uncertain if an increase of the computable amounts will take place in the medium term. • Stamp Tax. Stamp tax is a local tax that is levied based on the formal execution of public or private instruments. Documents subject to stamptax include, among others, all types of contracts, notarial deeds and promissory notes. Each province and the City of Buenos Aires have theirown stamp tax legislation. Stamp tax rates vary according to the jurisdiction and agreement involved. In general, stamp tax rates vary from0.5% to 3.5% and are applied based on the economic value of the instrument. • Personal Assets Tax. An annual net wealth tax applies on the net equity where the shareholder is a nonresident or a resident individual at arate of 0.50%. We have the right to request reimbursement from the shareholder. The taxable base of the personal assets tax is the book valueof the shares as stated in the last financial statements issued on December 31 on the relevant tax period. We are also subject to certain other non-material duties and taxes. Effect of Indebtedness Level and Interest Rates As of December 31, 2024, our total outstanding borrowings on a consolidated basis were Ps. 170,901 million. The level of our indebtednessresults in financial results that are reflected in our consolidated statement of profit or loss and other comprehensive income. Financial results consist of interestexpense, exchange gains/losses on U.S. dollar and other foreign currency-denominated debt, and other items as set forth in Note 10 of our audited consolidatedfinancial statements. During 2024, we recorded financial expenses of Ps. 82,523 million, which included Ps. 57,807 million in interest expense related to ourloans and financings. The interest rates we pay on our indebtedness depend on a variety of factors, including prevailing Argentine and international interest rates, anycollateral or guarantees and risk assessments of our company, our industry and the economies in Argentina and other markets in which we operate made by ourpotential lenders, potential purchasers of our debt securities and the rating agencies that assess our debt securities. Financial Presentation and Accounting Practices Presentation of Financial Statements We maintain our financial books and records in pesos. We have prepared our annual audited consolidated financial statements in accordance withIFRS Accounting Standards, as issued by the IASB. We have adopted all new and revised standards and interpretations issued by the IASB that are relevant toour operations and that are mandatorily effective as of December 31, 2024. The application of these amendments has had no impact on the disclosures oramounts recognized in our audited consolidated financial statements. Our audited consolidated financial statements have been prepared on a historical cost basis, which has been restated in end-of-period currency inthe case of non-monetary items. Upon estimating the fair value of an asset or a liability, we take into consideration the characteristics of the asset or the liability when marketparticipants do take these features into consideration when valuing the asset or the liability at the date of measurement. Fair value for purposes of measurementand/or disclosure in our financial statements is determined on that basis, except for the transactions consisting in share-based payments that are within the scopeof IFRS 2, lease transactions within the scope of IFRS 16 and the measurements that have certain points in common with fair value but are not fair value suchas net realizable value in IAS 2 or value in use in IAS 36. 69
Page 79
Table of Contents Besides, for financial reporting purposes, fair value measurements are categorized as level 1, 2 or 3 on the basis of the degree to which fair valuemeasurement inputs are observable and the impact of inputs for fair value measurements overall as described below: • Level 1: quoted (unadjusted) market prices in active markets for identical assets or liabilities that the entity can access at the measurementdate; • Level 2: valuation techniques for which the lowest level input that is significant to their value measurement is directly or indirectlyobservable; and • Level 3: valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable. Classification into current and non-current: We present assets and liabilities in our consolidated statement of financial position classified as current and non-current. Assets are classified as current when: (i) we expect to realize the asset or intend to sell or consume it during its normal operation cycle; (ii) we maintain the asset primarily for trading purposes; (iii)we expect to realize the asset within twelve months after the reporting period; or (iv)the asset is cash or cash equivalents unless the asset is restricted and may not be exchanged or used to settle a liability for at least twelvemonths after the reporting period. All the other assets are classified as non-current Liabilities are classified as current when: (i) we expect to settle the liability during its normal operation cycle; (ii) we maintain the liability primarily for trading purposes; (iii)the liability must be settled within the twelve months after the reporting period; or (iv)we do not have an unconditional rights to defer settlement of the liability for at least the twelve months after the reporting period. All the other liabilities are classified as non-current. Deferred tax assets and liabilities are classified as non-current assets and liabilities in all cases. Use of estimates The preparation of consolidated financial statements requires our board of directors to make judgements, estimates and assumptions that affect thereported amounts of the revenues, expenses, assets and liabilities and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertaintyabout these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected infuture periods. The description of the estimates and significant accounting judgments made by our board of directors in the application of accounting policies aswell as areas with a higher degree of complexity that require further judgment are disclosed in “Note 4 of our audited consolidated statements for the yearended December 31, 2024 and 2023”. The main accounting policies are herein below discussed. 70
Page 80
Table of Contents Principal Accounting Policies Standards and Interpretations issued but not yet effective The following is a description of the standards and interpretations that have been published but are not yet effective as of the date of issuance of ourconsolidated financial statements. We intend to adopt these standards, if applicable, when they become effective. • Lack of exchangeability - Amendments to IAS 21 In August 2023 the IASB issued amendments to IAS 21 “The Effects of Changes in Foreign Exchange Rates”. The amendment to IAS 21 specifies how anentity should assess whether a currency is exchangeable and how it should determine a spot rate when exchangeability is lacking. The amendments also requiredisclosures that enable users of financial statements to understand how the non-exchangeability of the currency into another currency affects, or is expected toaffect, the entity's financial performance, financial position and cash flows. This amendment is effective for financial statement reporting periods beginning on or after January 1, 2025. As of the date of issuance of this annual report, it has been assessed that there are no impacts derived from the application of this amendment, which willcontinue to be monitored as a consequence of the current foreign exchange regulations in Argentina. • Amendments to IFRS 7 and IFRS 9 In May 2024, the Board issued Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7), in whichthe Board: – Clarifies that a financial liability is derecognized on the “settlement date,” i.e., when the related obligation is discharged, cancelled, expires or theliability otherwise qualifies for derecognition. It also introduces an accounting policy option to derecognize financial liabilities that are settled throughan electronic payment system before the settlement date if certain conditions are met.– Clarifies how to assess the contractual cash flow characteristics of financial assets that include environmental, social and governance (ESG) and othersimilar contingent characteristics.– Clarifies the treatment of non-recourse assets and contractually linked instruments.– Requires additional disclosures in IFRS 7 for financial assets and liabilities with contractual terms that refer to a contingent event (including those thatare linked to ESG) and equity instruments classified at fair value through other comprehensive income. These amendments are effective for reporting periods beginning on or after January 1, 2026, but earlier application is permitted. No impacts are expected fromthe application of these amendments. • IFRS 18 Presentation and Disclosure in Financial Statements In April 2024, the IASB issued IFRS 18, which replaces IAS 1 Presentation of Financial Statements. IFRS 18 introduces new requirements for presentationwithin the income statement, including specified totals and subtotals. In addition, it requires entities to classify all income and expenses within the incomestatement into one of five categories: operating, investing, financing, income taxes, and discontinued operations. It also requires disclosure of management-defined performance measures, subtotals of income and expenses, and includes new requirements for the aggregationand disaggregation of financial information based on the identified roles of the primary financial statements and notes. In addition, limited-scope amendments have been made to IAS 7 Statement of Cash Flows, including changing the starting point for determining cash flowsfrom operations under the indirect method from "profit or loss" to "operating profit or loss" and eliminating the optionality surrounding the classification ofcash flows from dividends and interest. In addition, there are consequential amendments to several other standards. IFRS 18, and the amendments to the other standards, are effective for reporting periods beginning on or after January 1, 2027, but earlier application ispermitted, which must be disclosed. IFRS 18 will be applied retrospectively. 71
Page 81
Table of Contents The Group is currently working to identify all the impacts that the amendments will have on the primary financial statements and notes to the financialstatements. Adoption of new standards and interpretation We have adopted all the improvements and new standards and interpretations issued by IASB that are relevant to our operations and that are effective for thefinancial year ended December 31, 2024. As from January 1, 2024, we began to apply the following standards: • IAS 1 Classification of Liabilities as Current or Non-Current In January 2020, the IASB issued amendments to IAS 1 “Presentation of Financial Statements” to specify the requirements for the classificationof liabilities as current or non-current. The amendments clarify: (i) what is meant by a right to defer settlement; (ii) that a right to defer must exist at the end ofthe reporting period; (iii) that classification is unaffected by the likelihood that an entity will exercise its deferral right; and (iv) that only if an embeddedderivative in a convertible liability is itself an equity instrument would the terms of a liability not impact its classification. These amendments did not have animpact on our consolidated financial statements. • Lease Liability in a Sale and Leaseback – Amendments to IFRS 16 The amendment to IFRS 16 Leases specifies the requirements that a seller-lessee uses in measuring the lease liability arising in a sale andleaseback transaction, to ensure the seller-lessee does not recognize any amount of the gain or loss that relates to the right of use it retains. These changes hadno impact on the Group's consolidated financial statements. • Disclosures: Supplier Finance Arrangements -Amendments to IAS 7 and IFRS 7 In May 2023, the Board issued amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures. The amendmentsspecify disclosure requirements to enhance the current requirements, which are intended to assist users of financial statements in understanding the effects ofsupplier finance arrangements on an entity’s liabilities, cash flows and exposure to liquidity risk. Given the current situation and the Group's business practicein recent years, these changes had no impact on the Group's consolidated financial statements. Critical Accounting Policies Critical accounting policies are those that are important to the presentation of our financial condition and results of operations and that require ourmanagement to make difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherentlyuncertain. As the number of variables and assumptions affecting the possible future resolution of the uncertainties increases, those judgments become evenmore subjective and complex. For more information about our critical accounting policies, see the notes to our audited consolidated financial statements. In order to provide an understanding of how our management forms its judgments about future events, including the variables and assumptionsunderlying the estimates, and the sensitivity of those judgments to different circumstances, we have identified the following critical accounting policies: • revenue recognition; • leases; • foreign currency and functional currency; • borrowing costs; • taxation (income tax and personal assets tax); • property, plant and equipment; • impairment of tangible and intangible assets; • inventories; • provisions, including environmental restoration and assets decommissioning obligations, and provision for lawsuits and other contingencies; • financial instruments; 72
Page 82
Table of Contents • financial assets; • financial liabilities and equity instruments; • short- and long-term employee benefits; • stripping and quarry exploitation costs; • Ferrosur Roca S.A. concession; and • Management’s account estimates and judgments on environmental matters. Revenue recognition We are engaged in the production and distribution of cement, masonry cement, concrete, limestone and aggregates, as well as logistics servicesthrough railway concession, and the industrial waste recycling business. The goods to be delivered and the services to be provided arise from agreements withcommercial substance (in general, they are not written) where we may identify the right of each one of the parties and the payment terms. Sale of goods Revenues from sales of goods are recognized when control over goods is transferred to the customer for an amount that reflects the considerationthat we expect to be entitled to in exchange for such assets. The customer obtains control of the goods when significant risks and rewards of the products soldare transferred in accordance with the specific delivery terms agreed with the customer. Revenues from the sale of goods are measured at fair value of theconsideration received or to be collected, net of commercial discounts. No financing components are considered in the transaction since credit terms varygreatly between 20 and 35 days, depending on the specific terms agreed upon, which is consistent with market practices. Some agreements with customers offer commercial discounts or volume-based discounts. If revenues cannot be reliably measured, we deferrevenue recognition until the uncertainty is resolved. However, due to the fact that performance obligations relate mainly to the delivery of the acquired goods,and that both the price and any discount granted are specifically agreed between the parties, there are in practice no uncertainties associated with revenuerecognition from sales of goods. Variable consideration is recognized when there is a high likelihood that there will not be a significant reversal in the amountof the accumulated revenues recognized in the agreement and is measured using the expected value or the most likely amount method, whichever allows tomake a better prediction of the amount based on the terms and conditions of the agreement. The products sold by us in general are not returned by customers once they have approved their quality, which occurs at the time of reception. Services rendered We provide transportation services along with the sale of cement, concrete, limestone, and aggregates. Revenues from transportation services arerecognized at the time services are provided, which is usually when revenues from the sale of the transported good are recognized as transportation distance andtime is very short. Revenue is measured on the basis of the consideration defined in the contract with customers. Revenues from freight railway services and waste recycling services are recognized at the time such services are rendered. 73
Page 83
Table of Contents Leases Group as Lessee: The accounting model for the recognition and measurement of all leases is as follows: Right of use assets We recognize a right of use asset at the beginning of each lease (the date on which the underlying asset is available for use). Right of use assets aremeasured at cost, net of accumulated depreciation and impairment losses, and adjusted to reflect any remeasurement of liabilities and to recognize changes inthe purchasing power of currency. The cost of the right of use assets includes the amount of the recognized lease liabilities, initial direct costs incurred, andlease payments made at or before the lease start date, less any incentives received. Unless we are certain that it will acquire the asset at the end of the lease,right of use assets are depreciated on a straight-line basis over the shorter of their estimated useful lives and the lease term (calculated based on the term of therelevant agreements, including renewal provisions in the event that they are highly likely to continue). The right of use assets are subject to impairment. We apply the short-term lease recognition exception (i.e., those leases that have a lease term of 12 months or less from the inception date and donot contain a purchase option). We also apply the recognition exception to leases that are considered to be of low value. Payments under these leases arerecognized as expense on a straight-line basis over the lease term. Lease liabilities Lease liabilities are measured at the present value of future lease payments to be made throughout the lease term, for which market rates havebeen used according to the nature and term of each agreement. Lease payments include fixed payments, less any lease incentives to be received, variablepayments depending on an index or rate and amounts expected to be paid under residual value guarantees. Lease payments also include the exercise price ofany purchase option of the leased underlying asset, and any penalties for terminating the lease, provided that it is reasonably likely that we will exercise suchoptions. Variable payments that do not depend on an index or rate are recognized in profit or loss for the year of occurrence of the condition to which they aresubject. The unwinding of the discount recognized for each lease is accounted by us in the comprehensive income of each year. Group as Lessor: The income from the operating lease of buildings and equipment is recognized every month during the lease term. Leases in which we do nottransfer substantially all the risks and rewards inherent in the ownership of the asset are classified as operating leases. The initial direct costs incurred innegotiating an operating lease are in addition to the carrying amount of the leased asset and are recognized throughout the lease term on the same basis as leaseincome. Foreign currency and functional currency For purposes of the consolidated financial statements, the income/ (loss) and the financial condition of each company are stated in pesos,considered to be functional currency (the currency of the primary economic environment in which an entity operates) for all group companies and this is alsothe currency of presentation of the consolidated financial statements. For purposes of presentation of our consolidated financial statements, the assets and liabilities from our foreign operations are translated to pesosat foreign exchange rates prevailing at the end of the reporting period and their statement of profit or loss and other comprehensive income are translated at theaverage foreign exchange rate for each month, unless the corresponding foreign exchange rate has fluctuated significantly during the month, in which case, theexchange prevailing on the date of the transaction is used. Transactions in foreign currencies are initially recorded at their respective functional currency spot rates at the date the transaction first qualifiesfor recognition. 74
Page 84
Table of Contents Foreign exchange gains / (losses) from monetary items are recognized in profit and loss for the year, restated at year-end currency, except forthose arising from borrowings denominated in foreign currency to financing qualifying assets, such as assets under construction for future productive use,which were included in the cost of such assets for being considered as an adjustment to the cost of interest accrued on such foreign currency denominatedborrowings. Borrowing costs Borrowing costs, net of the effect of inflation directly attributed to the acquisition, construction or production of qualifying assets, which are assetsthat take a substantial period of time to get ready for their intended use or sale, are capitalized as part of the cost of the asset until the assets are ready for use orsale. Income earned on short-term investments of specific outstanding borrowings to finance the construction of qualifying assets is deducted from theborrowing costs that may qualify for capitalization. All the other borrowing costs are recognized in profit or loss when incurred, net of the effect of the inflation on the liabilities that generated them.We have not capitalized interest or exchange differences in the fiscal years ended December 31, 2024 and 2023. Taxation Argentina Income tax We assess the income tax charge to be booked in accordance with the deferred tax method, which considers the effect of timing differencesoriginating in the different basis for measuring assets and liabilities according to accounting and tax criteria and of the existing net losses and unused tax creditssusceptible of deduction of future taxable income computed by considering the tax rate in force. Law No. 27,260, which was enacted on June 16, 2021,introduced amendments to the corporate tax rate by setting a staggered structure of applicable rates based on the level of accumulated net taxable income foreach company, which may be 25%, 30% or 35%; the 7% tax on the distribution of dividends, however, has remained unchanged. Current taxesCurrent tax payable is based on the taxable profit for the fiscal year. Taxable profit differs from profit before tax as reported in the consolidatedstatement of profit and loss and other comprehensive income because of items of income, or expenses that are taxable or deductible in other years and itemsthat will never be taxable or deductible. Our liability for current tax is calculated using the tax rates that have been substantially enacted at the end of thereporting period, computing the tax losses carryforward corresponding to their respective amounts adjusted for inflation in accordance with the mechanismsprovided for in Article No. 25 of the Argentine Income Tax Law. Deferred tax Deferred tax is recognized on the temporary differences between the carrying amount of the assets and liabilities included in the consolidatedfinancial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all futuretaxable temporary differences. Deferred tax assets are recognized for all deductible temporary differences to the extent that we are likely to have future taxprofit against which it is possible to account for those deductible temporary differences. Such deferred tax assets and liabilities are not recognized whentemporary difference arose from goodwill or the initial recognition (other than in a business combination) of other assets and liabilities in a transaction thataffects neither the taxable nor the accounting profit and does not give rise to equal taxable and deductible temporary differences. The carrying amounts of deferred tax assets are reviewed at the end of each fiscal year and derecognized to the extent it is no longer probable thatsufficient taxable profit will be available to allow all or part of the asset to be recovered. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the fiscal year when the asset is realized or the liabilityis settled, based on tax rates (and tax laws) that have been enacted or substantially enacted at the end of the reporting period. Measurement of deferred taxliabilities and deferred tax assets at the end of fiscal 75
Page 85
Table of Contents year being reported reflects the tax consequences that would stem from the manner in which the entity expects to recover or settle the carrying amount of itsassets and liabilities. We offset deferred tax assets and deferred tax liabilities if and only if a) it has legally enforceable right to set off current taxes and currentliabilities and b) the deferred tax assets and liabilities relate to income taxes levied by the same tax authority on either the same taxable entity or differenttaxable entities and we intend either to settle current tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, ineach future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered. Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates, except wherewe are able to control the reversal of the temporary difference and it is probable that temporary differences will not reverse in the foreseeable future. Deferredtax assets arising from deductible temporary differences associated with such investments are recognized only to the extent it is probable that there will besufficient taxable profit to use the benefits of temporary differences and they are expected to reverse in a foreseeable future period. Current and deferred taxes Current and deferred taxes are recognized in the statement of profit and loss and other comprehensive income, except when they relate to itemsthat are recognized in other comprehensive income or directly in equity, in which case, the current and deferred taxes are also recognized in othercomprehensive income or directly in equity, respectively. When current tax or deferred taxes arise from a business combination, the tax effect is included in theaccounting for the business combination. Personal asset tax—Substitute responsible Argentine resident individuals and non-Argentine resident individuals and entities, are subject to a personal asset tax at a rate of 0.50% over of theequity value of any shares or the American Depositary Shares issued by Argentine entities, held as of December 31 of each year. The tax is on the Argentineissuers of said shares, who must pay for this tax on behalf of the relevant shareholders. In accordance with the Personal Asset Tax Law, we are entitled to obtain a reimbursement of the tax paid from the shareholders levied with theabove-mentioned tax through the reimbursement mechanism that the we deem advisable. Property, plant and equipment Property, plant and equipment held for use in the production or supply of goods and services, or for administrative purposes, are recorded at theircost restated in constant currency at the end of the reporting period, in accordance with Note 2.2, less accumulated depreciation and impairment loss. The cost includes the stripping and initial preparation of the open pit quarries, and the counterpart for the environmental restoration and/ordismantling obligations recognized. It also includes borrowing costs for long-term construction projects if the recognition criteria are met. When significant parts of plant and equipment are required to be replaced at intervals, we depreciate them separately based on their specific usefullives. Likewise, when a major inspection is performed, its cost is recognized in the carrying amount of the plant and equipment as a replacement if therecognition criteria are satisfied. All other repair and maintenance costs are recognized in profit or loss as incurred. The lands owned by Loma Negra are not subject to depreciation. Construction in progress for administrative, production, supply or other purposes are carried at cost restated in constant currency at the end of thereporting period less any recognized impairment loss. Depreciation of Property, Plant and Equipment commences when such assets are ready for their intended use. Property, plant and equipment are depreciated, except for land and assets under construction, over their estimated useful lives using the straight-line method. The estimated useful life, the residual value and the depreciation 76
Page 86
Table of Contents method are reviewed at the end of each fiscal year, with the effect of any changes in estimates being accounted for on a prospective basis. Gain or loss from the disposal or write-off of an item of property, plant and equipment is calculated as the difference between net disposalproceeds and the carrying amount of the asset and is recognized in profit or loss at its value restated at the year-end currency. We assess the recoverability of the value of its property, plant and equipment items whenever any indication of impairment is identified. Theassessments are carried out considering the cash-generating units established by us. Intangible assets Intangible assets with finite useful lives, acquired separately, are recorded at cost, restated in the currency at the closing date less accumulatedamortization and less accumulated impairment losses. The estimated useful lives and amortization method are reviewed at each year-end, with the effect of any changes in these estimates recordedprospectively. Intangible assets with indefinite useful lives that are acquired separately are recorded at cost restated in the currency at the closing date lessaccumulated impairment losses. An intangible asset is derecognized when no future economic benefits are expected from its use or disposal. Gains or losses arising from thederecognition of an intangible asset, measured as the difference between the net proceeds from the derecognition and the asset's carrying amount, arerecognized in earnings when the asset is derecognized. Impairment of tangible and intangible assets At the end of each period, we review if any indication that tangible and intangible assets might be impaired. In case of impairment indicators are observed, we calculate the recoverable amount per cash-generating unit. The recoverable amount of an assetis the higher of the fair value less cost of disposal and its value in use. In assessing value in use, the estimated future cash flows are discounted using a pre-taxdiscount rate that reflects current market assessments as of year-end with respect to the time value of money considering the risks that are specific to the asset. If the recoverable value of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying value of the asset (orcash-generating unit) is reduced to its recoverable value. Impairment losses are immediately recognized in profit or loss. When a recognized impairment loss is subsequently reversed, the book value of the asset is increased up to the new recoverable amount but thereversal is limited so that the carrying amount of the asset does not exceed the carrying amount that would have been determined, net of depreciation, had noimpairment loss been recognized for the asset or CGU in prior years. Impairment loss reversals are immediately recognized in profit loss. Impairment lossesrelated to goodwill are not reversed in future periods. Inventories Inventories are stated at the lower of cost restated in constant currency at the end of period and net realizable value. Costs incurred in bringingproducts to their present condition are accounted for as follows: • Raw materials and spare parts: at acquisition cost according to the weighted average price method. • Finished goods and work in progress: at acquisition cost of raw materials and labor, plus a proportion of manufacturing overheads based onnormal operating capacity. The net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costsnecessary to make the sale. In assessing recoverable amounts of inventories, slow-moving inventories are also considered. The carrying amount of inventoriesas of the fiscal year-end does not exceed their recoverable value. 77
Page 87
Table of Contents Provisions We recognize provisions when we have a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow ofresources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Estimated amounts of the obligation are based on the expected outflows that will be required to settle such obligation. If the effect of the timevalue of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When we expect some or all of a provision to be reimbursed, the reimbursement is recognized as a separate asset (a receivable), but only when thereimbursement is virtually certain and the amount of the receivable can be reliably measured. We use the opinion of our legal advisers to determine if a provision should be recorded as well as to estimate the amounts of the obligations. Environmental restoration and asset decommissioning obligations Under legal provisions and best practices, and the environmental commitments assumed by the company, land used by the Group for mining andquarrying is subject to environmental restoration, and the fixed assets used in production will be removed at the end of operations. In this context, provisions are recognized as long as they are determinable, in order to afford the estimated expenses for the environmentalrecovery and restoration of the mining areas and the retirement of the corresponding productive assets. These provisions are recorded simultaneously with theincrease in value in the underlying asset and the relevant depreciation of the assets involved is recognized in profit and loss prospectively. The liability recorded is increased due to the unwinding of the discount and this change is charged to net profit or loss. In estimating the expectedcost, we take into account changes in environmental legislation and regulations, if any, that may impact the process and restoration and dismantling costs. Theenvironmental restoration and asset retirement obligation can also increase or decrease due to changes in the estimated timing of cash flows, changes in thediscount rate and/or changes in the original estimated undiscounted costs. In estimating the expected cost, the Group takes into account changes inenvironmental legislation and regulations, if any, that may impact the process and restoration and dismantling costs. Increases or decreases in the obligationother than the unwinding of discount will result in a corresponding change in the carrying amount of the related asset. Actual costs incurred upon settlement ofthe asset retirement obligation are charged against the asset retirement obligation to the extent of the liability recorded. We discount the costs related to assetretirement obligations using the discount rate that reflects the current market assessment of the time value of money and risks specific to the liabilities that havenot been reflected in the cash flow estimates. Asset retirement obligations are remeasured at each reporting period in order to reflect the discount rates in effectat that time. In addition, we follow the practice of progressively restoring the areas by the removal of quarries using the provisions recognized for that purpose. Provisions for lawsuits and other contingencies The final settlement cost of complaints and litigation may vary due to estimates based on different interpretations of regulations, opinions and final assessmentsof damages. Therefore, any change in the circumstances related to this type of contingencies may have a significant impact on the amount of the provision forcontingencies recorded. In the normal course of its business, we select tax criteria and accounting positions based on a reasonable interpretation of the current regulations, also takinginto consideration the opinion of its tax and legal advisors along with evidence available up to the date of issuance of these financial statements. Nevertheless,in the event of situations where the assessment by a third party and the potential occurrence of damage for the Group are uncertain, the Group has not recordeda provision as it is has not been required under IFRS Accounting Standards. 78
Page 88
Table of Contents The Group makes judgments and estimates to assess whether it is necessary to record costs and make provisions for environmental cleanup remediation andasset retirement obligations based on the current information related to expected remediation costs and plans. In the case of environmental provisions, costsmay differ from estimates due to changes in laws and regulations, discovery and analysis of local conditions, as well as changes in cleanup technologies.Therefore, any change in the factors or circumstances related to this type of provisions, as well as any amendment to the rules and regulations may thus have asignificant impact on the provisions recorded our financial statements. Financial instruments Financial assets and financial liabilities are recognized when we become a party to the contractual provisions of the instruments. Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition orissue of financials assets and financial liabilities (other than financial assets and liabilities at fair value through profit or loss) are added or deducted from thefair value of the financial assets of financial liabilities, as appropriate, on initial recognition. Transactions costs directly attributable to the acquisition offinancial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss. Interest and financial income are recognized to the extent the effective interest rate is accrued. In general, the Group receives short-term advances from its customers. Pursuant to the practical expedient of IFRS 15, the Group does not adjustthe promised amount of consideration for the effects of a significant financing component if it expects, at contract inception, that the period between the entitytransfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less. The Group does not receive anylong-term advances from its customers. Financial assets According to the provisions under IFRS 9 “Financial instruments”, we classify for purposes of subsequent measurement our financial assets intothe following two categories because the company has not asset that are designated as fair value through other comprehensive income: Financial assets at amortized cost A financial asset is measured at amortized cost if both of the following conditions are met: (i) the asset is held within a business model whoseobjective is to hold assets in order to collect contractual cash flows; and (ii) the contractual terms of the financial asset give rise on specified dates to cash flowsthat are solely payments of principal and interest on the principal amount outstanding. In addition, for the assets that satisfy the conditions mentioned above, IFRS 9 provides the option of designating at the time of initial recognition,an asset as measured at reasonable value if in doing so it eliminates or significantly reduces an inconsistency in valuation or recognition that would have arisenif the valuation of the assets or liabilities or the recognition of their income or loss were effected on different bases. We have not designated any financial asset at fair value using this option. As of December 31, 2024, our financial assets at amortized costcomprise certain cash and cash equivalent elements, accounts receivable, trade and other receivables. Financial assets at fair value through profit or loss If one of the criteria mentioned above were not satisfied, the financial asset is classified as an asset measured at “fair value through profit or loss”. At the date of our consolidated financial statement contained herein our financial assets at fair value through profit or loss include mutual fundsclassified as current investments. 79
Page 89
Table of Contents Recognition and measurement Acquisitions and disposals of financial assets are recognized on the date on which our promises to purchase or sell the asset. Financial assets arederecognized when the rights to receive cash flows from such instruments and the risks and benefits related to their ownership have been terminated orassigned. Financial assets at amortized cost are initially recognized at fair value plus transaction costs. These assets accrue interest based on the effectiveinterest rate method. Financial assets at fair value through profit or loss are initially recognized at fair value and transaction costs are recognized as expenses in thestatement of profit or loss and other comprehensive income. They are subsequently measured at fair value. Changes in fair values and gains or losses on the saleof financial assets at fair value through profit or loss are recognized in “Financial results, net” in the statement of profit or loss and other comprehensiveincome. In general, we use the transaction price to determine the fair value of a financial instrument at initial recognition. In all other cases, we onlyrecords a gain or loss at initial recognition if the fair value of the instrument is evidenced by other comparable and observable market transactions for the sameinstrument or is based on a valuation technique incorporating only observable market data. Any gains or losses not recognized at initial recognition of afinancial asset are subsequently recognized only to the extent that they arise from a change in factors (including time) that market participants would consider inestablishing the price. The results of debt instruments that are measured at amortized cost and are not designated in a hedging relationship are recognized in the profit orloss and other comprehensive income statement using the effective interest rate method. The Group reclassifies between categories all investments in debtinstruments only when there is a change in the business model used to manage such assets. Financial asset impairment At the end of each period, we assess if there is objective evidence of impairment of a financial asset or group of financial assets measured atamortized cost. Impairment is recorded only if there is objective evidence of the impairment as a consequence of one or more events occurred after the initialrecognition of the asset and said impairment may be reliably measured. The Group defined a policy to calculate expected credit losses for trade receivables and record the related allowance for debtors’ impairment. Thedetermination of the expected loss is initially based on the Group’s historical observed default rates and it is complemented by a case by case analysis toidentify special circumstances on individual customers and/or transactions. This bad debt percentage must take into account expected future credit collectionsand, therefore, any estimated changes in behavior. Before accepting any new customer, the Group conducts an internal credit analysis to assess the potentialcustomer's creditworthiness and define their credit limit. The limits and ratings assigned to major customers are reviewed at least once a year. Evidence of impairment includes indications that the debtors or a group of debtors are experiencing serious financial difficulties, default or arrearsin interest or principal payments, the likelihood that they will be declared bankrupt or file for reorganization proceedings, and when such observable dataindicates that there is a decrease in the estimated future cash flows. The amount of the impairment is measured as the difference between the book value of the asset and the present value of estimated future cashflows (excluding future loan losses that have not been incurred) discounted at the original effective interest rate of the financial asset. The carrying amount ofthe asset is written down and the amount of the loss is recognized in the profit or loss and other comprehensive income. As a practical measure, we maymeasure impairment on the basis of the fair value of an instrument, using an observable market price. If, in a subsequent period, the impairment amountdecreases and such reduction is related to an event taking place after the original impairment, the reversal of the impairment loss is recognized in theconsolidated statement of profit or loss and other comprehensive income. 80
Page 90
Table of Contents Offsetting of financial instrument Financial assets and financial liabilities are offset if there is a currently enforceable legal right to offset the recognized amounts and when there isan intent to settle on a net basis, to realize the asset and settle the liability simultaneously. Derecognition of a financial asset A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised (i.e., removed from theGroup’s consolidated statement of financial position) when: • The rights to receive cash flows from the asset have expired, or • We transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delayto a third party under a ‘pass-through’ arrangement; and either (a) we have transferred substantially all the risks and rewards of the asset, or (b) wehave neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if, and to what extent,it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Group continues torecognize the transferred asset to the extent of its continuing involvement. In that case, the Group also recognizes an associated liability. The transferred assetand the associated liability are measured on a basis that reflects the rights and obligations that the Group has retained. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset andthe maximum amount of consideration that the Group could be required to repay. Financial liabilities and equity instruments Classification as debt or equity Debt and equity instruments are classified as financial liabilities or as equity in accordance with the substance of the contractual agreement andthe definitions of financial liabilities and equity instruments. Equity instrumentsAn equity instrument consists in a contract evidencing a residual ownership interest over an entity’s net assets after deducting all its liabilities.Equity instruments issued by us are recognized at the amount of proceeds received, net of direct issuance costs. The repurchase of our own equity instruments is recognized and deducted directly in equity. No gain or loss is recognized in profit or lossstemming from purchases, sales, issuance or cancellation of our own equity instruments. Note 3.16 of our consolidated financial statements disclose the valuation and classification criterion for all individual equity accounts, includingnon-controlling interest. Financial Liabilities: Financial liabilities are classified as at fair value through profit or loss or other financial liabilities. The Group does not have financial liabilitiesthat arise from supplier finance arrangement. Financial liabilities at fair value through profit or loss: A financial liability at fair value through profit or loss is a financial liability classified either as held for trading or at fair value through profit orloss. Financial liabilities are classified as held for trading if: a) It has been acquired or incurred principally for the purpose of selling or repurchasing it in the near term; or b) At the time of initial recognition, the liabilities are part of a portfolio of financial instruments that are managed by the Group and there isevidence of a recent current pattern of short-term profit; or 81
Page 91
Table of Contents c) It is a derivative that has not been designated and is not effective as a hedging instrument or financial guarantee. Financial liabilities at fair value through profit or loss are recorded at fair value, with any gains or losses arising from the remeasurement beingrecognized in profit or loss. The net gain or loss recognized in profit or loss includes any interest paid on the financial liability and is included in other financialresults. Fair value is determined as described in Note 32 of our consolidated financial statements. Financial liabilities (other than financial liabilities held for trading) or contingent consideration to be paid by an acquirer as a part of a businesscombination may be designated as a liability at fair value through profit and loss upon initial recognition if:• Such designation eliminates or significantly reduces a potential accounting mismatch that would otherwise arise; or • Financial liabilities are part of a group of financial assets or liabilities or both, which is managed and whose performance is assessed on thebasis of fair value, in accordance with the Group’s documented risk management or investment strategy, and information about the Group isprovided internally on that basis; or • They are part of a contract containing one or more embedded derivatives, and IFRS 9 allows the entire combined contract to be carried at fairvalue through profit and loss. We have no financial liabilities measured at fair value to be presented in the statement of financial position. Other financial liabilities: Other financial liabilities, including borrowings and trade and other payables, are initially recognized at fair value, net of transaction costs. Subsequent to initial recognition, other financial liabilities are then measured at amortized cost using the effective interest rate method, withinterest expense recognized based on actual return. Financial liabilities are classified as current liabilities unless the Group has an unconditional right to defer settlement for more than twelve monthsafter the date of the financial statements. Financial liabilities in foreign currency: The fair value of financial liabilities in foreign currency is determined in that foreign currency and translated at the exchange rate at the end ofeach fiscal year. The foreign currency component is part of its profit or loss at fair value. For financial liabilities classified as at fair value through profit or loss,the foreign currency component is recognized in profit or loss. For debt instruments denominated in foreign currency classified at amortized cost, gains and losses in foreign currency are determined on thebasis of the amortized cost of the liability and recognized in “Exchange rate differences” under the “Financial results net” in the statement of profit or loss andother comprehensive income. Derecognition of financial liabilities: We derecognize financial liabilities if, and only if, the obligations of the Group expire, are settled or satisfied. Short- and long-term employee benefits Liabilities are recognized for the benefits accrued in favor of employees with respect to the salaries and wages, annual vacations and leaves ofabsence due to diseases in the period in which the service is rendered in connection with the non-discounted amount of the benefits expected to be paid inexchange for such service. Liabilities recognized with respect to other long-term employee benefits (severance payment plans resulting from specific plans for employeesleaving the Group and receiving a compensation payable in installments) are measured at the present value of estimated future cash outflows expected to bepaid. See Note 3.17 of our financial statements as of December 31, 2024, and in "Item 6.A. Directors, Senior management and Employees" and "Item 6.B.Compensation" of this annual report for information about the current employee benefit plans. 82
Page 92
Table of Contents Until November 2024, the cost of the share-based payment plans to be settled with equity instruments issued under the existing program wasmeasured at fair value at the date of each grant and it is recognized as "Salaries, wages, and social security contributions" in the comprehensive income over theperiod in which the performance and/or service conditions were met, with a corresponding entry to “Share-based payment plans” in shareholders' equity. Theaccumulated expense recognized for these plans at each closing date, and up to the vesting date, reflects the extent to which the vesting period has been met andthe Group’s best estimate of the number of equity instruments that would ultimately remain as vested benefit for the employees. During the month of November 2024, the outstanding balance of the active plans that was maintained in equity was reclassified to liabilitiesconsidering that it is the intention of the Group's Management to settle the plans in cash. The liability is measured at fair value at the end of each fiscal year,with a corresponding charge to comprehensive income statement under the account "Salaries, wages, and social security contributions". Stripping and quarry exploitation costs In the ordinary course of business, the company undertakes several exploration and evaluation activities in order to search for mineral ore anddetermine the technical and commercial feasibility of the resources identified. Exploration and evaluation activities include research and analysis of historicalexploration data, the compilation of exploration data through geological studies, exploratory drilling and sampling in several areas, the determination of thevolume and qualification of the resources identified, among others. Following the guidelines established by IFRIC 20 "Uncovering costs in the production phase of an open-pit mine", the costs of uncovering andinitial preparation of open-pit quarries for subsequent exploitation are capitalized as property, plant and equipment, as part of the development and uncoveringcosts of the Company's open-pit quarries, and are subsequently depreciated based on the units extracted, considering for this purpose the estimate of thereserves available for extraction and existing in the uncovered area at any given time. Periodically, the Group re-evaluates the estimate of the proven reserves inthe uncovered quarries and prospectively adjusts the effects of any differences in the estimate of the tonnes available for extraction. Due to the periodicity of thereviews of the estimates, the risk of significant differences in them is reduced. Extraction costs incurred subsequently during the Company's production phase are recognized as part of the cost of production. Mineral rights acquired in connection with the right to explore existing exploration areas are capitalized and amortized during the term of theright. As soon as a legal right has been acquired to explore, exploration and evaluation costs are expensed as incurred to profit or loss, unless the company’smanagement arrives at the conclusion that there is a highest likelihood of obtaining future profits; when this is the case, costs are capitalized. In assessingwhether the costs satisfy the criteria to be capitalized several information sources are used, including the nature of the assets, the surface area explored and theresults of the samples taken, among others. All capitalized stripping, exploration and evaluation costs are subject to impairment testing. In the case of determining a potential impairmentindicator, the company carries out an assessment of its recoverability together with the group of related operating assets, which represents the cash-generatingunit to which the exploration is attributed. Ferrosur Roca S.A. concession Management has reviewed the Group’s interest in Ferrosur Roca S.A., taking into account the provisions of IFRIC 12 Service ConcessionArrangements, which provides guidance on accounting by the operators of public-to-private service concession arrangements. Based on the fact that the grantor neither controls nor regulates which services should be provided by the operator to the infrastructure or to whomit must provide them, and at what price, the company's management concluded that the Ferrosur Roca S.A. concession is out of the scope of IFRIC 12 and,therefore, the Group does not apply its provisions. Accordingly, the Group has recorded the assets received from the concession and those subsequentlyacquired under IAS 16 - Property, Plant and Equipment. The concession bidding terms and conditions grant an original term of thirty years (1993-2023) and originally provided for the possibility of anextension for ten additional years, which was rejected by the Ministry of Transport for the reasons described in Note 36 to the consolidated financial statements.On October 1, 2024, the Ministry of Transport 83
Page 93
Table of Contents provisionally granted an extension for an additional term of 12 months as from the expiration date of the concession. Therefore, the concession of FerrosurRoca S.A. will end in September 2025. The Group has evaluated potential business scenarios based on its intention to continue delivering services as a rail network operator and has notanticipated significant associated effects to date. Likewise, it has reassessed all the accounting estimates affected to the end of the current concession, especiallythose associated with the recoverability of certain non-current assets affected by it. The evaluations carried out by us are detailed in Note 36 to the consolidatedfinancial statements. Management’s accounting estimates and judgments on environmental matters The Group is constantly working on a responsible and sustainable business strategy, committed to improving environmental performance on anongoing basis, minimizing environmental impact caused by its operations, and providing maximum value for society. To this end, we have set various environmental sustainability goals within the medium term (year 2030) and long term (year 2050), in alignmentwith the 2030 Agenda Sustainable Development Goals (“SDG”) promoted by the United Nations. The main committed goals are related to maximizing energy efficiency and renewable energy, reducing gas emissions and improving air quality,reducing the carbon footprint, maximizing water management, streamlining waste management by promoting circular economy, and improving efficiency in theuse of materials. In preparing the consolidated financial statements, the Group's management has considered the potential environmental impact. Therefore, theestimates and judgments made by the Group's management primarily involve assumptions related to future regulations and performance of the industry inwhich the Group operates. The effects of changes in the estimates and judgments made may primarily relate to impairment tests on property, plant andequipment, the estimated useful life of fixed those assets and therefore the related depreciation recognized annually, as well as the recognition of provisions,such as the environmental provision to afford the estimated expenses for the environmental recovery and restoration of the mining areas exploited by the Group. Components of Certain Statement of Profit or Loss and Other Comprehensive Income Line Items Revenues Our revenues are derived by deducting discounts to clients from our gross sales revenue. Practically all of our gross sales revenue is denominatedin pesos and is derived primarily from our sale of cement products, concrete, aggregates and railway services. 84
Page 94
Table of Contents Cost of Sales Our cost of sales consists of electrical power, manual labor, contractors, depreciation and amortization, freight, packaging and other costs. Thefollowing table sets forth the approximate percentage of our total cost of sales that each such component represented for the years ended December 31, 2024,2023 and 2022. For the Year EndedDecember 31, 2024 2023 2022 (in percentages) Salaries, wages and social security charges 17.0 15.3 14.9 Thermal energy 12.8 16.0 15.9 Depreciation 12.4 10.1 12.3 Preservation and maintenance costs 11.4 9.1 8.5 Freight 9.4 10.5 10.7 Contractors 9.3 7.9 6.9 Electrical power 7.7 7.7 8.7 Packaging 3.5 3.3 3.5 Taxes, contributions and commissions 1.9 1.7 1.8 Transport and travelling expenses 1.2 0.9 0.7 Fees and compensation for services 1.0 1.5 1.9 Employee benefits 0.7 0.5 0.4 Security 0.7 0.5 0.5 Insurance 0.4 0.4 0.3 Leases 0.2 0.2 0.2 Communications 0.1 0.1 0.1 Canon (concession fee) 0.1 0.1 0.1 Data processing 0.1 0.1 0.1 Water, natural gas and energy services 0.0 0.0 0.0 Tolls 0.0 0.0 0.0 Others 1.7 1.2 1.4 Production expenses 91.7 87.0 88.8 Cost of sales 100.0 100.0 100.0 Selling and Administrative Expenses Our selling and administrative expenses consist of salaries, benefits and expenses paid to or on behalf of our sales force, advertising andmarketing expenses, certain taxes, delivery services and other expenses. The following table 85
Page 95
Table of Contents sets forth the approximate percentage of our selling and administrative expenses that each such component represented for the years ended December 31, 2024,2023 and 2022. For the Year Ended December 31, 2024 2023 2022 (in percentages) Salaries, wages and social security charges 26.2 25.0 25.1 Taxes, contributions and commissions 20.5 21.5 24.3 Freight 12.3 12.1 14.7 Fees and compensation for services 8.3 8.6 6.6 Managers, directors and trustees’ fees 6.6 7.3 7.7 Depreciation and amortization 5.5 5.2 6.5 Advertising expenses 5.4 5.5 4.6 Data processing 5.0 3.6 2.5 Insurance 3.8 4.5 2.5 Others 1.8 2.2 1.7 Transport and travelling expenses 1.6 1.4 1.3 Employee benefits 1.4 1.4 0.8 Leases 0.7 0.4 0.3 Communications 0.4 0.5 0.8 Preservation and maintenance costs 0.3 0.3 0.2 Allowance for doubtful accounts 0.1 0.3 0.2 Water, natural gas and energy services 0.1 0.0 0.0 Security 0.0 0.2 0.2 Total selling and administrative expenses 100.0 100.0 100.0 Financial results, net Our financial results principally reflects: (1) interest payments in respect of our short- and long-term indebtedness; (2) income from our financialinvestments; (3) unwinding on liabilities and receivables; (4) loss from securities transactions; (5) foreign exchange variations related to our foreign currency-denominated indebtedness; (6) gain or loss on net monetary position.; and (7) fees, commissions and other charges paid to financial institutions for borrowings.The non-cash components of our financial income (expenses), net, include foreign exchange variation. For a description of our outstanding indebtedness as ofDecember 31, 2024, see “Item 5. Operating and Financial Review and Prospects. B-Liquidity and Capital Resources”. Income Tax Expense Income tax expense includes current and deferred taxes. Current income tax is measured as the amount expected to be paid (or recovered, to theextent applicable) to tax authorities based on the taxable profit for the period. Deferred taxes includes the effect of temporary differences originating in thedifferent basis for measuring assets and liabilities according to accounting and tax criteria and of the existing net losses and unused tax credits susceptible ofdeduction of future taxable income computed by considering the tax rate. Results of Operations In the following discussion, references to increases or decreases in any period are made by comparison with the prior period, except as the contextotherwise indicates. For a reconciliation of the operating results of our operating segments for the periods indicated to our consolidated results of operations,see Note 31 to our audited consolidated financial statements included elsewhere in this annual report. 86
Page 96
Table of Contents Year Ended December 31, 2024, compared to the Year Ended December 31, 2023 The following table sets forth our consolidated statement of profit or loss and other comprehensive income for 2024 and 2023: For the Year EndedDecember 31, Variation 2024 2023 Amount (%) (in millions of Ps., except percentages) Revenue 699,178.7 919,312.7 (220,134.0) (23.9) Cost of sales (512,197.7) (688,685.3) 176,487.6 (25.6) Gross profit 186,981.0 230,627.4 (43,646.4) (18.9) Selling and administrative expenses (73,175.4) (84,199.9) 11,024.5 (13.1) Other gains and losses 4,555.2 1,999.2 2,556.0 127.9 Tax on debits and credits to bank accounts (7,420.4) (10,183.8) 2,763.4 (27.1) Finance costs, net Exchange rate differences (43,708.5) (255,244.8) 211,536.3 (82.9) Gain on net monetary position 262,879.5 302,169.4 (39,289.9) (13.0) Financial income 1,962.9 12,434.2 (10,471.3) (84.2) Financial expenses (82,522.5) (159,671.2) 77,148.7 (48.3) Profit before taxes 249,551.8 37,930.5 211,621.3 557.9 Income tax expense Current (66,450.2) (8,296.6) (58,153.6) 700.9 Deferred (29,475.1) (8,553.3) (20,921.8) 244.6 Net profit 153,626.5 21,080.6 132,545.9 628.8 ________________ Revenues Our revenues decreased Ps. 220,134 million, or 23.9%, from Ps. 919,313 million in 2023 to Ps. 699,179 million in 2024, primarily due to lowertopline performance of our core business, Cement, followed by the Concrete, Aggregates and Railroad segments. • Cement, masonry cement and lime segment: Revenues from our cement, masonry cement and lime segment, without considering theeliminations between segments, decreased Ps. 185,792 million, from Ps. 805,719 million in 2023 to Ps. 619,927 million in 2024, mainly dueto a decrease of 23.7% in sales volume. • Concrete segment: Revenues from our concrete segment, without considering the eliminations between segments, decreased Ps. 32,519million, from Ps. 88,165 million in 2023 to Ps. 55,646 million in 2024, mainly due to a decrease of 31.8% in sales volume and an averagesales price decrease of 7.5%. • Railroad segment: Revenues from our railroad segment, without considering the eliminations between segments, decreased Ps. 7,536 million,from Ps. 72,440 million in 2023 to Ps. 64,904 million in 2024, mainly due to a decrease of 13.4% in sales volume, partially offset by a 3.5%increase in the average selling price. • Aggregates segment: Revenues from our aggregates segment, without considering the eliminations between segments, decreased Ps. 10,797million, from Ps. 28,066 million in 2023 to Ps. 17,269 million in 2024 mainly due to a decrease of 24.8% in sales volume and an averageprice decrease of 18.1%. • Others segment: Revenues from Recycomb S.A.U., without considering the eliminations between segments, increased Ps. 1,771 million, fromPs. 5,184 million in 2023 to Ps. 6,955 million in 2024. Cost of sales Our cost of sales decreased Ps. 176,488 million, or 25.6%, from Ps. 688,685 million for 2023 to Ps. 512,198 million for 2024, mostly as aconsequence of the lower sales volume. The main contributors to our cost of sales decrease 87
Page 97
Table of Contents during the period were (1) Ps. 58,318 million in thermal and electrical energy costs, due to a lower sales volume and a lower impact of energy inputs on ourcost of sales; (2) Ps. 23,734 million in lower freight costs, mainly due to lower sales volume and (3) a Ps. 18,216 million in lower costs of salaries, wages andsocial contributions. The following table sets forth the reconciliation of our production costs to our cost of sales for the years indicated: As of and for the YearEnded December 31, 2024 2023 (in millions of Ps.) Purchases and production expenses for the year 565,001.7 722,979.7 (+) Inventories at the beginning of the year 215,926.2 181,631.7 (-) Inventories at the end of the year 268,730.2 215,926.2 Cost of sales 512,197.7 688,685.3 The cost of sales of our segments is set forth below, eliminations between segments are not considered: • Cement, masonry cement and lime segment: Cost of sales from our cement, masonry cement and lime segment, without considering theeliminations between segments, decreased Ps. 147,388 million, or 25.5%, from Ps. 577,030 million in 2023 to Ps. 429,642 million in 2024.This decrease in cost of sales was mainly due to (1) lower thermal and electrical energy costs as a consequence of decreased sales volume andlower unitary costs in US dollars; (2) a decrease in salaries, wages and social contributions; and (3) lower freight costs mainly due to adecreased outbound and inbound transportation needs. • Concrete segment: Cost of sales from our concrete segment, without considering the eliminations between segments, decreased Ps. 28,533million, or 32.7%, from Ps. 87,384 million in 2023 to Ps. 58,851 million in 2024. This decrease in the cost of sales was mainly due to adecrease in the cost of raw materials, salaries and social security contributions, maintenance costs and equipment leasing associated with thedrop in volume. • Railroad segment: Cost of sales from our railroad segment decreased Ps. 9,748 million, or 13.1%, from Ps. 74,420 million in 2023 to Ps.64,672 million in 2024, mainly due to lower transported volume coupled with lower costs of salaries, wages, social contributions andmaintenance materials. • Aggregates segment: Cost of sales from our aggregates segment decreased Ps. 6,003 million, or 22.9%, from Ps. 26,233 million in 2023 to Ps.20,230 million in 2024. This decrease was primarily due to lower equipment rental costs and lower salaries and social security contributionsassociated with the drop in volume. • Others segment: Cost of sales from Recycomb S.A.U. segment increased Ps. 446 million, or 11.5%, from Ps. 3,879 million in 2023 to Ps.4,325 million in 2024. Gross profit Due to the factors mentioned above, our gross profit decreased Ps. 43,646 million, or 18.9%, from Ps. 230,627 million in 2023 to Ps. 186,981million in 2024. Our gross margin (gross profit divided by revenues and expressed as a percentage) expanded by 166 basis points, from 25.1% in 2023 to 26.7%in 2024. Selling and administrative expenses Our selling and administrative expenses decreased Ps. 11,025 million, or 13.1%, from Ps. 84,200 million in 2023 to Ps. 73,175 million in 2024,mainly due to (1) a decrease in Taxes, duties, contributions, and commissions due to lower sales volume; (2) a decrease in Freight due to lower volume; (3) adecrease in salaries, wages and social contributions; and (4) a decrease in the remuneration of directors and trustees. Other gains and losses Our other gains and losses increases Ps. 2,556 million, or 127.9%, from a net gain of Ps. 1,999 million in 2023 to a net gain of Ps. 4,555 million in2024, mainly due to the sale of property, plant and equipment. 88
Page 98
Table of Contents Tax on bank accounts debits and credits Our tax on bank accounts debits and credits decreased Ps. 2,764 million, or 27.1%, from Ps. 10,184 million in 2023 to Ps. 7,420 million in 2024,related to the volume of monetary transactions carried out the respective fiscal year. Financial results, net Our total net financial cost decreased Ps. 238,924 million, from a loss of Ps. 100,312 million in 2023 to a gain of Ps. 138,611 million in 2024,principally due to (1) a decrease of Ps. 211,536 million in loss due to exchange rate differences; (2) a decrease in gain on net monetary position of Ps. 39,290million; (3) a lower charge of Ps. 76,886 million from interest on borrowings; (4) a lower profit of Ps 9,932 million from temporary investments; and (5) ahigher loss from other net financial income and expense of Ps. 277 million. Our financial expenses decreased Ps. 77,149 million, or 48.3%, from Ps. 159,671 million in 2023 to Ps. 82,523 million in 2024, mainly due to alower impact of Ps. 76,886 million from interest on borrowings Our financial income decreased Ps. 10,471 million, or 84.2%, from Ps. 12,434 million for 2023 to Ps. 1,963 million for 2024. Income tax expense Our income tax expense increased Ps. 79,075.4 million, or 469.0%, from Ps. 16,849.9 million in 2023 to Ps. 95,925.3 million in 2024 mainly dueto the increase in profit for the year 2024 compared to that of 2023. The resulting effective tax rate was 38.4% in 2024 compared to 44.4% in 2023, affected bythe hyperinflation adjustments for income tax determination . The following table presents our effective tax rate reconciliation for each year. For the year endedDecember 31, 2024 2023 (amounts in millions of Ps.) Profit before income tax expense 249,551.8 37,930.5 Statutory rate 35 % 35 % Income tax at statutory rate (87,343.1) (13,275.7) Adjustments for calculation of the effective income tax: Recovery of tax losses / Unrecognized tax losses 437.2 2,315.4 Effects of the inflation adjustment for accounting and tax purposes (8,905.7) (6,487.2) Other non-taxable income or non-deductible expense net (113.6) 597.6 Income tax expense (95,925.3) (16,850.0) Income tax expense Current (66,450.2) (8,296.6) Deferred (29,475.1) (8,553.3) Total (95,925.3) (16,850.0) Our current income tax increased Ps. 58,154 million, or 700.9%, from Ps. 8,297 million in 2023 to Ps. 66,450 million in 2024, mainly explainedby a higher profit before taxes. Our deferred income tax increased Ps. 20,922 million, from Ps. 8,553 million in 2023 to Ps. 29,475 million in 2024, mainly due to the use of taxloss carryforwards existing as of December 31, 2023. 89
Page 99
Table of Contents Net profit As a result of the foregoing, our net profit increased Ps. 132,546 million, or 628.8%, from Ps. 21,081 million in 2023 to Ps. 153,627 million in2024. Our net margin (net profit divided by revenues and expressed as a percentage) increased by 1,968 basis points, from 2.3% in 2023 to 22.0% in 2024. Year Ended December 31, 2023, compared to the Year Ended December 31, 2022 The following table sets forth our statement of profit or loss and other comprehensive income for 2023 and 2022: For the Year EndedDecember 31, Variation 2023 2022 Amount (%) (in millions of Ps., except percentages) Revenue 919,312.7 984,191.5 (64,878.8) (6.6) Cost of sales (688,685.3) (718,413.3) 29,728.0 (4.1) Gross profit 230,627.4 265,778.2 (35,150.8) (13.2) Selling and administrative expenses (84,199.9) (84,838.3) 638.4 (0.8) Other gains and losses 1,999.2 22,957.7 (20,958.5) (91.3) Tax on debits and credits to bank accounts (10,183.8) (9,868.5) (315.3) 3.2 Finance costs, net Exchange rate differences (255,244.8) (50,311.1) (204,933.7) 407.3 Gain on net monetary position 302,169.4 93,224.0 208,945.4 224.1 Financial income 12,434.2 11,028.7 1,405.5 12.7 Financial expenses (159,671.2) (173,355.7) 13,684.5 (7.9) Profit before taxes 37,930.5 74,615.0 (36,684.5) (49.2) Income tax expense Current (8,296.6) (27,835.2) 19,538.6 (70.2) Deferred (8,553.3) (34,526.7) 25,973.4 (75.2) Net profit 21,080.6 12,253.1 8,827.5 72.0 Revenues Our revenues decreased Ps. 64,879 million, or 6.6%, from Ps. 984,192 million in 2022 to Ps. 919,313 million in 2023, primarily due to lowertopline performance of our core business, Cement, followed by the Railroad segment. This was partially offset by a better performance of Concrete andAggregates. • Cement, masonry cement and lime segment: Revenues from our cement, masonry cement and lime segment, without considering theeliminations between segments, decreased Ps. 63,943 million, from Ps. 869,662 million in 2022 to Ps. 805,719 million in 2023, mainly due toan average sales price decrease of 7.3%, coupled by a decrease of 4.5% in sales volume. • Concrete segment: Revenues from our concrete segment, without considering the eliminations between segments, increased Ps. 4,982 million,from Ps. 83,183 million in 2022 to Ps. 88,165 million in 2023, mainly due to an increase of 0.2% in sales volume and an average sales priceincrease of 5.7%. • Railroad segment: Revenues from our railroad segment, without considering the eliminations between segments, decreased Ps. 6,793 million,from Ps. 79,232 million in 2022 to Ps. 72,440 million in 2023, mainly due to an decrease of 7.5% in sales volume, coupled by a decline of1.2% in the average sales price. • Aggregates segment: Revenues from our aggregates segment, without considering the eliminations between segments, increased Ps. 3,538million, from Ps. 24,528 million in 2022 to Ps. 28,066 million in 2023 mainly due to an increase of 3.9% in sales volume and an average priceincrease of 10.2%. 90
Page 100
Table of Contents • Others segment: Revenues from Recycomb S.A.U., without considering the eliminations between segments, decreased Ps. 996 million, fromPs. 6,180 million in 2022 to Ps. 5,184 million in 2023. Cost of sales Our cost of sales decreased Ps. 29,728 million, or 4.1%, from Ps. 718,413 million for 2022 to Ps. 688,685 million for 2023, mostly as aconsequence of the lower sales volume. The main contributors to our cost of sales decrease during the period were (1) Ps. 18,939 million in depreciation; (2) Ps.13,408 million in thermal and electrical energy costs, due to lower sales volume and lower incidence of energy inputs in our cost of sales; and (3) a Ps. 4,608million in lower freight costs, principally due to lower sales volume. The following table sets forth the reconciliation of our production costs to our cost of sales for the years indicated: As of and for the YearEnded December 31, 2023 2022 (in millions of Ps.) Purchases and production expenses for the year 722,979.7 744,419.2 (+) Inventories at the beginning of the year 181,631.7 155,625.8 (-) Inventories at the end of the year 215,926.2 181,631.7 Cost of sales 688,685.3 718,413.3 The cost of sales of our segments is set forth below, eliminations between segments are not considered: • Cement, masonry cement and lime segment: Cost of sales from our cement, masonry cement and lime segment, without considering theeliminations between segments, decreased Ps. 20,457 million, or 3.4%, from Ps. 597,487 million in 2022 to Ps. 577,030 million in 2023. Thisdecrease in cost of sales was mainly due to (1) lower thermal and electrical energy costs as a consequence of decreased sales volume andlower unitary costs in US dollars; (2) a decrease in depreciation; and (3) lower freight costs mainly due to a decreased outbound and inboundtransportation needs. • Concrete segment: Cost of sales from our concrete segment, without considering the eliminations between segments, increased Ps. 4,254million, or 5.1%, from Ps. 83,130 million in 2022 to Ps. 87,384 million in 2023, mainly reflecting an increase in costs due to higher rawmaterials costs, equipment leases and maintenance costs and salaries, partially compensated by lower fuel cost. • Railroad segment: Cost of sales from our railroad segment decreased Ps. 15,466 million, or 17.2%, from Ps. 89,886 million in 2022 to Ps.74,420 million in 2023, mainly due to lower transported volume coupled with lower depreciation and fuel costs. • Aggregates segment: Cost of sales from our aggregates segment increased Ps. 3,706 million, or 16.5%, from Ps. 22,527 million in 2022 to Ps.26,233 million in 2023, mainly reflecting an increase in costs due to higher sales volume, higher equipment leases, maintenance and anincrease in salaries, wages and social security charges. • Others segment: Cost of sales from Recycomb S.A.U. segment decreased Ps. 98 million, or 2.5%, from Ps. 3,977 million in 2022 to Ps. 3,879million in 2023. Gross profit Due to the factors mentioned above, our gross profit decreased Ps. 35,151 million, or 13.2%, from Ps. 265,778 million in 2022 to Ps. 230,627million in 2023. Our gross margin (gross profit divided by revenues and expressed as a percentage) was contracted by 192 basis points, from 27.0% in 2022 to25.1% in 2023. Selling and administrative expenses Our selling and administrative expenses decreased Ps. 638 million, or 0.8%, from Ps. 84,838 million in 2022 to Ps. 84,200 million in 2023, mainlydue to (1) a decrease in Taxes, duties, contributions, and commissions due to lower 91
Page 101
Table of Contents sales volume; (2) a decrease in Freight due to lower volume; and partially compensated by (3) an increase in Insurance, data processing and Fees andcompensation for services. Other gains and losses Our other gains and losses decreased Ps. 20,959 million, or 91.3%, from Ps. 22,958 million in 2022 to Ps. 1,999 million in 2023, mainly due to thesale of a non-strategic property in Olavarría in 2022. Our tax on bank accounts debits and credits increased Ps. 315 million, or 3.2%, from Ps. 9,869 million in 2022 to Ps. 10,184 million in 2023,related to the volume of monetary transactions carried out the respective fiscal year. Financial results, net Our total net financial cost decreased Ps. 19,102 million, from a loss of Ps. 119,414 million in 2022 to a loss of Ps. 100,313 million in 2023,principally due to (1) an increase in gain on net monetary position of Ps. 208,945 million; (2) a higher loss of Ps. 204,934 million from exchange ratedifferences; (3) a lower charge of Ps. 115,597 million from securities transactions; (4) a higher loss of Ps 96,023 million from interest on borrowings; and (5) ahigher loss from other net financial income and expense of Ps. 4,482 million. Our financial expenses decreased Ps. 13,685 million, or 7.9%, from Ps. 173,356 million in 2022 to Ps. 159,671 million in 2023, mainly due to alower impact of Ps. 115,595 million from losses with securities transactions and a higher loss of Ps 96,023 million from interest on borrowings. Our financial income increased Ps. 1,405 million, or 12.7%, from Ps. 11,029 million for 2022 to Ps. 12,434 million for 2023. Income tax expense Our income tax expense decreased Ps. 45,512 million, or 73.0%, from Ps. 62,362 million in 2022 to Ps. 16,850 million in 2023. The effective taxrate was 44.4% in 2023 compared to 83.6% in 2022, primarily due to the impact of a valuation allowance of certain specific tax losses recorded in 2022. The following table presents our effective tax rate reconciliation for each year. For the year ended December 31, 2023 2022 (amounts in millions of Ps.) Profit before income tax expense 37,930.5 74,615.0 Statutory rate 35 % 35 % Income tax at statutory rate (13,275.7) (26,115.2) Adjustments for calculation of the effective income tax: Recovery of tax losses / Unrecognized tax losses 2,315.4 (30,412.1) Effects of the inflation adjustment for accounting and tax purposes (6,487.2) (5,600.7) Other non-taxable income or non-deductible expense net 597.6 (233.9) Income tax expense (16,850.0) (62,361.9) Income tax expense Current (8,296.6) (27,835.2) Deferred (8,553.3) (34,526.7) Total (16,850.0) (62,361.9) ________________ 92
Page 102
Table of Contents Our current income tax decreased Ps. 19,539 million, or 70.2%, from Ps. 27,835 million in 2022 to Ps. 8,297 million in 2023, mainly explained bya lower profit before taxes. Our deferred income tax decreased Ps. 25,974 million, or 75.2% from Ps. 34,527 million in 2022 to Ps. 8,553 million in 2023, due to the valuationallowance of specific tax loss carryforwards recorded in 2022, as previously mentioned. Net profit As a result of the foregoing, our net profit increased Ps. 8,828 million, or 72.0%, from Ps. 12,253 million in 2022 to Ps. 21,081 million in 2023.Our net margin (net profit divided by revenues and expressed as a percentage) increased by 105 basis points, from 1.2% in 2022 to 2.3% in 2023. B. Liquidity and Capital Resources Our financial condition and liquidity is and will be influenced by a variety of factors, including: • our ability to generate cash flows from our operations; • the level of our outstanding indebtedness and the interest that we are obligated to pay on our indebtedness, which affect our net financialexpenses; • variations in the exchange rate of Argentine pesos versus other currencies; • prevailing domestic and international interest rates, which affect our debt service requirements; and • our capital expenditure requirements, which consist primarily of investments in our operations, maintenance, equipment and plant facilities. Our principal cash requirements consist of the following: • working capital requirements; • the servicing of our indebtedness; and • capital expenditures related to investments in our operations, maintenance, equipment and plant facilities. During 2024, we used cash flow generated by our continuing operations, primarily for capital expenditures, working capital needs and payment ofinterest on our financial debt. As of December 31, 2024, our cash and cash equivalents (defined as cash and banks and short-term investments as sated in Note29 to our consolidated financial statements) was Ps. 8,553 million. On January 27, 2023, our board of directors approved the first issuance of simple corporate bonds not convertible into shares under our GlobalCorporate Bond Issuance Program for up to US$150.0 million which was approved by the general shareholders’ meeting held on April 16, 2020, the terms andconditions of which were approved by our board of directors at its meeting held on the same day. On February 22, 2023, the company issued its Class 1 Corporate Bonds, which resulted in a face value of Ps. 25,636.3 million (equivalent toUS$133.3 million), bearing interest at BADLAR + 2% and maturing within 18 months. As of December 31, 2024, these corporate bonds have been cancelled. On April 25, 2023, the general shareholders’ meeting approved the increase in the amount of our Global Corporate Bond Issuance Program toUS$500 million. On June 21, 2023, the company issued its Class 2 Corporate Bonds, which resulted in a face value of US$71.7 million, bearing interest at 6.50%and maturing within 30 months. The issue was approved by our board of directors on June 9, 2023. 93
Page 103
Table of Contents On September 11, 2023, the company issued its Class 3 Corporate Bonds, which resulted in a face value of US$55 million, bearing interest at7.49% and maturing within 30 months. The issue was approved by our board of directors on August 31, 2023. On November 2, 2023, the company issued its Class 4 Corporate Bonds, which resulted in a face value of US$10 million, bearing interest at 6%and maturing within 30 months. The issue was approved by our board of directors on October 25, 2023. During the fiscal year ended December 31, 2024, Loma Negra entered into funding agreements through stock market repurchase agreements(caución bursátil). These borrowings were obtained through Banco de Valores S.A. and were secured by public securities obtained on loan. The cost of theseguarantees is included in the borrowing rate and is accrued over the duration of the loan. The Group does not recognize assets or liabilities in connection withthe collateral granted, as the associated guarantees do not transfer the rights or obligations of ownership. During 2024, the Company also entered intofundraising agreements by issuing promissory notes through the EPYME channel of Caja de Valores S.A. We believe that our cash and cash equivalents on hand, cash from operations and borrowings that we believe are available to us, will be adequateto meet our capital expenditure requirements and liquidity needs at least for the next 12 months. We implement liquidity risk management practices, keepingcash and other liquid instruments, as well as available funds. We may require additional capital to meet our long-term liquidity objectives and future growthrequirements. As noted in note 24 to the financial statements as of December 31, 2024, the Group considers that it has adequate sources of liquidity, subject tothe information outlined in "Item 3.D. Risk Factors" herein. Capital Resources After the completion of our capacity expansion project with the second line of L'Amalí in 2021, we significantly reduced our capital expendituresneeds. During 2024, we principally invested in maintenance capital expenditures and the 25 kilograms project, which were financed mainly from our cash ofoperations and new debt financings. Regarding future commitments, we have no other material investment plans other than the one related to the legal requirement of adjusting ourcement bags to the 25 kilograms format. See "Item 3.D. Compliance with Resolution 54/2018 of the Secretary of Commerce could adversely affect ouroperations and profitability.” Cash Flows The table below sets forth our cash flows from continuing operating activities, continuing investing activities and continuing financing activitiesfor the years ended December 31, 2024, 2023 and 2022: For the Year Ended December 31, 2024 2023 2022 (in millions of Ps.) Cash and cash equivalents at the beginning of the year 14,664.6 33,302.5 43,666.8 Net cash generated by operating activities 124,718.1 185,164.9 212,676.1 Net cash used in investing activities (72,893.9) (78,014.6) (31,987.1) Net cash used in financing activities (48,265.9) (89,469.4) (168,053.4) Effect of restating in constant currency of cash and cash equivalents (10,032.8) (50,562.3) (24,546.8) Effects of exchange rate differences on cash and cash equivalents in foreign currency 363.4 14,243.5 1,546.9 Cash and cash equivalents at the end of the year 8,553.4 14,664.6 33,302.5 Year Ended December 31, 2024 In 2024, our cash resulting from profit before tax, adjusted to reconcile net profit to net cash generated by operating activities was Ps. 152,989million. The sum of changes in operating assets and liabilities were Ps. 28,271 million in 2024, which was mainly due to an increase in inventories of Ps46,089, an increase in trade accounts receivable of Ps 39,849, a decrease in other liabilities of Ps. 11,246 and cash flows of a Ps. 12,494.8 million in income taxpaid and, 94
Page 104
Table of Contents partially offset by cash flows proceeding from an increase in accounts payable of Ps. 54,603 million and an increase of Ps. 22,911 from other receivables. In2024, net cash provided by operating activities amounted to Ps. 124,718 million. Our net cash flow used in investing activities was Ps. 72,894 million in 2024, mainly as a result of our acquisition of property, plant andequipment of Ps. 73,048 million. Our net cash flow used in financing activities was Ps. 48,266 million in 2024, primarily due to interest paid to service our debt of Ps. 61,591million, partially offset by net proceeds from borrowings of Ps. 15,656 million. Our cash and cash equivalents of continuing operations decreased by Ps. 6,111 million in 2024. Year Ended December 31, 2023 In 2023, our cash resulting from profit before tax, adjusted to reconcile net profit to net cash generated by operating activities was Ps.167,065million. The sum of changes in operating assets and liabilities were Ps. 18,100 million in 2023, which was mainly due to an increase in trade payablesof Ps 98,456, an increase in other liabilities of Ps 15,392, and an increase in salaries and social security contributions of Ps 14,682 and, partially offset by cashflows of a Ps. 12,048 million in income tax paid and an increase of Ps. 64,977 million from trade accounts and other receivables, and an increase in inventoriesfor Ps. 31,740 million. In 2023, net cash provided by operating activities amounted to Ps. 185,165 million. Our net cash flow used in investing activities was Ps. 78,015 million in 2023, mainly as a result of our acquisition of property, plant andequipment of Ps. 78,511. Our net cash flow used in financing activities was Ps. 89,469 million in 2023, primarily due to dividend payments of Ps. 189,116 million, interestpaid to service our debt of Ps. 118,407 million, partially offset by net proceeds from borrowings of Ps. 220,146 million. Our cash and cash equivalents of continuing operations decreased by Ps. 18,638 million in 2023. Year Ended December 31, 2022 In 2022, our cash resulting from profit before tax, adjusted to reconcile net profit to net cash generated by operating activities was Ps. 246,140million. The sum of changes in operating assets and liabilities were Ps. 33,464 million in 2022, which was mainly due to cash flows of Ps. 72,114 million usedin income tax paid and an increase of Ps. 70,008 million from trade accounts and other receivables, an increase in inventories for Ps. 21,469 million, partiallyoffset by a Ps. 75,706 million from an increase in trade account payables. In 2022, net cash provided by operating activities of Ps. 212,676 million. Our net cash flow used in investing activities was Ps. 31,987 million in 2022, mainly as a result of our acquisition of property, plant andequipment of Ps. 69,192 million, partially offset by Ps. 22,351 million from proceeds from disposal of property, plant and equipment and Ps. 16,242 millionfrom redemption of investments. Our net cash flow used in financing activities was Ps. 168,053 million in 2022, primarily due to dividend payments of Ps. 147,871 million, interestpaid to service our debt of Ps. 32,251 million and repurchase of common stock for Ps. 12,189 million, partially offset by net proceeds from borrowings of Ps.26,179 million. Our cash and cash equivalents of operations decreased by Ps. 10,364 million in 2022. Indebtedness and Financing Strategy As of December 31, 2024, our total outstanding consolidated borrowings were Ps. 170,901 million, consisting of Ps. 100,680 million of short-termborrowings, including current portion of long-term borrowings (or 59% of our total borrowings) and Ps. 70,221 million of long-term borrowings (or 41% of ourtotal borrowings). Our foreign currency-denominated consolidated borrowings as of December 31, 2024, were Ps. 156,366 million (or 91% of our total borrowings),all of which were denominated in U.S. dollars. Our peso-denominated borrowings were Ps. 14,536 million (or 9% of our total borrowings). As of December 31, 2024, 9% of the company's consolidated loans accrued interest at a variable rate, as it is debt in pesos. The remaining 91%accrues interest at a fixed rate, all of which is in foreign currency. 95
Page 105
Table of Contents The following tables sets forth selected information with respect to our principal outstanding borrowings as of December 31, 2024 (expressed inthousands of Ps.): 2024 2023 Ref. Company Rate Last maturitydate Amount Amount Borrowings in foreign currency - USD Negotiable promissory note (1) Loma Negra C.I.A.S.A. 6.00% Jan-25 1,026,977 - Negotiable promissory note (1) Loma Negra C.I.A.S.A. 6.00% Feb-25 2,563,066 - Negotiable promissory note (1) Loma Negra C.I.A.S.A. 7.00% Sep-25 1,770,302 - Negotiable promissory note (1) Loma Negra C.I.A.S.A. 7.00% Oct-25 2,925,992 - Negotiable promissory note (1) Loma Negra C.I.A.S.A. 7.25% Dec-25 2,418,884 - Negotiable promissory note (1) Loma Negra C.I.A.S.A. 7.25% Jan-26 2,284,544 - Negotiable promissory note (1) Loma Negra C.I.A.S.A. 7.25% Feb-26 104,302 - Negotiable promissory note (1) Loma Negra C.I.A.S.A. 7.50% Apr-26 763,552 - Banco Patagonia (2) Ferrosur Roca S.A. - - - 81,184 Banco Patagonia (2) Ferrosur Roca S.A. - - - 192,008 Total borrowings in foreign currency 13,857,619 273,192 Borrowings in local currency Bank overdrafts (3) Ferrosur Roca S.A. 38.24% Jan-25 4,873,033 5,018,973 Bank overdrafts (3) Loma Negra C.I.A.S.A. 38.00% Jan-25 295,789 10,116,128 Securities-guaranteed (4) Loma Negra C.I.A.S.A. 37.41% Jan-25 9,366,848 - Total borrowings in local currency 14,535,670 15,135,101 2024 2023 Ref. Company Rate Last maturitydate Amount Amount Corporate notes - USD Serie – Class 2 (5) Loma Negra C.I.A.S.A. 6.50% Dec-25 74,103,576 125,979,900 Serie – Class 3 (5) Loma Negra C.I.A.S.A. 7.49% Mar-26 57,997,572 98,565,157 Serie – Class 4 (5) Loma Negra C.I.A.S.A. 6.00% May-26 10,406,768 17,681,136 Total corporate bonds in foreingcurrency 142,507,916 242,226,193 2024 2023 Ref. Company Rate Last maturitydate Amount Amount Corporate notes - Ps. Serie – Class 1 (6) Loma Negra C.I.A.S.A. - - - 63,284,373 Total corporate bonds in local currency - 63,284,373 Total 170,901,205 320,918,859 As of December 31, 2024, the average maturity of our indebtedness was 0.9 years. Our financing strategy over the next years principally involvesminimizing the firm cost of capital, maintaining an adequate indebtedness level with a debt maturity profile compatible with our anticipated cash flowgeneration and anticipated capital expenditures. As of December 31, 2024, the Company's debt contracts do not include restrictive clauses that imply an obligation to maintain financial ratiosand/or non-financial commitments to which it must adhere. The following is a description of our material indebtedness as of the date of this annual report. 96
Page 106
Table of Contents (1) As of December 31, 2024, Loma Negra entered into fundraising agreements by issuing promissory notes through the EPYME channel of Caja deValores S.A. These notes bear interest at a fixed rate and are not guaranteed. (2) During the fiscal year 2023 and 2022 , Ferrosur Roca S.A. entered into several contracts in US dollars with Banco Patagonia, accruing interest at afixed rate. As of December 31, 2024, these loans have been cancelled. (3) As of December 31, 2024 and 2023, the Group carries bank overdrafts in the amount of 5,168,822 and 15,135,101, respectively. Bank overdraftsexisting at the beginning of the year were canceled regularly during fiscal year 2024. (4) During the fiscal year ended December 31, 2024, Loma Negra took a borrowing through Banco de Valores S.A., providing as collateral securitiesobtained on loan. The cost of these guarantees is included in the borrowing rate and is accrued over their duration. The Group does not recognize assetsor liabilities in connection with the collateral granted because its loan conditions do not provide risks and rewards of ownership over them. (5) On June 21, September 11, and November 2, 2023, the Company issued its Class 2, 3 and 4 Corporate Bonds in dollars for a total amount of US$71,723thousand, US$55,000 thousand and US10,000 thousand, with an interest rate of 6.5%, 7.49% and 6.00%, and maturing on December 21, 2025, March11, 2026 and May 2, 2026, respectively. Interest is paid semiannually. The issuance of these corporate bonds in foreign currency has been carried outwithin the scope of the local public offering, without intervention of the single and free exchange market ("MULC"). These debts have been valued attheir amortized cost in foreign currency, converting the resulting amounts into local currency at the official selling exchange rate effective at the end ofthe reporting period. (6) On February 22, 2023, the Company issued its Class 1 Corporate Bonds for a total amount of $25,636.3 million, with an interest rate BADLAR + 2.0%,principal maturity at 18 months and payments quarterly interest. As of December 31, 2024, these corporate bonds have been cancelled. Contractual Commitments The following table presents information relating to our contractual obligations as of December 31, 2024: Payments Due by Period Total Less than 1 year 1-3 years 3-5 years More than 5 years (in millions of Ps.) Financial borrowings (1) 170,901.20 100,680.04 70,221.17 - - Accounts payable 93,590.80 93,590.80 - - - Taxes payable 46,844.68 46,844.68 - - - Salaries and social security contributions 19,418.66 17,909.95 1,508.71 - - Lease liabilities 3,186.64 1,388.36 1,782.34 15.95 - Severance payment plans 639.22 479.26 155.16 4.32 0.48 Other debts(2) 1,367.25 517.01 - - 850.24 Total 335,948.46 261,410.09 73,667.38 20.27 850.72 ________________(1) “See – Note 24 of our audited consolidated statements for the years ended December 31, 2024 and 2023”.(2) Corresponds to our internal information. 97
Page 107
Table of Contents Selected Ratios Comparative ratios as of and for the years ended December 31, 2024, 2023 and 2022: As of and for the Year Ended December 31, 2024 2023 2022 Liquidity 1.02 1.09 0.97 Solvency 1.29 0.85 1.33 Non-current assets to total assets ratio 0.81 0.80 0.80 Profitability 0.21 0.03 0.01 (1) Current assets / Current liabilities(2) Shareholder’s equity / Total liabilities(3) Non-current assets / Total assets(4) Net profit / Average shareholder’s equity Supply Contracts In 2007, we entered into a 15-year agreement with Siderar S.A.I.C., Argentina’s largest steel company, for the supply of ground granulated blast-furnace slag. We purchase various sources of energy from several suppliers, traders and distributors of natural gas. The relations with these suppliers ensure that wehave the necessary levels of energy to operate and give us flexibility to purchase additional energy, if needed. None of these purchase orders represents amaterial amount of our total energy supply. In 2016, we entered into 20-year contract with Genneia S.A. and in 2018 we entered into a 20-year contract with Aluar Aluminio Argentino S.A.I.C.,for the provision of wind-sourced electric power commencing on January 1, 2018 and in February 1, 2019 (respectively), to ensure compliance with theobligations imposed by Law No. 26,190 and Law No. 27,191, and related regulations, whose main objective is to reduce the use of fossil energy by increasingthe use of renewable energy for industrial users in Argentina commencing in 2018. With these contracts, we currently exceed the requirements of the Law No.27,191, reaching approximately 58% of renewable energy in the energy matrix. C. Research and Development, Patents and Licenses, etc. Intellectual Property As of December 31, 2024, Loma Negra had 120 registered trademarks, one of which is pending trademark application for renewal with theArgentine National Intellectual Property Institute ("INPI" (Instituto Nacional de la Propiedad Industrial)). In addition, Recycomb has two registrations andFerrosur Roca has one. There are no pending trademarks of these companies. We do not own any registered patents, industrial models or designs. We are required to renew these trademark registrations when they expire at the end of their respective terms. Under the Argentine Trade andService Marks Law No. 22,362, the term of duration of a registered trademark is 10 years from its issue date, and a trademark may be indefinitely renewed forequal periods thereafter if, within the five-year period prior to each expiration, the trademark was used in the marketing of a product, in the rendering of aservice or as the designation of an activity. We have no pending litigation related to trademark matters. We have also registered our trademarks in Bolivia,Brazil, Chile, Paraguay and Uruguay. As of December 31, 2024, Loma Negra has 2 oppositions filed against third parties’ trademarks which are currently being resolved under theadministrative opposition proceedings at INPI. In addition, Loma Negra is owner of 13 internet domains registered at the Network Information CenterArgentina (NIC). We have no published works or deposits of unpublished works under copyright. D. Trend Information (1) (2) (3) (4) 98
Page 108
Table of Contents We believe that the macroeconomic environment and the trends in the Argentine economy have affected and will, for the foreseeable future,continue to affect our results of operations and profitability. Our continued success and ability to increase our value to our shareholders will depend upon,among other factors, economic growth in Argentina. This analysis should be read in conjunction with “Item 5-A”— Operating Results — Principal factorsAffecting Our Results of Operations.” In 2023 the Argentine economy faced notable challenges. A severe drought affected the agricultural sector leading to considerable export and taxrevenue losses, consequently contributing to a federal budget deficit. These difficulties were exacerbated by the electoral developments within the year. The national consumer price index published by INDEC accumulated 211.4% in 2023 (as compared to 94.80% in 2022), and 117.8% in 2024 (ascompared to 211.4% in 2023). Additionally, the Argentine peso experienced a depreciation rate of 356.44% against the US Dollar in 2023, of 27.7% in 2024and of 3.93% in the first three months of 2025. Moreover, on April 1, 2025, the BCRA recorded a low level of U.S dollars reserves, amounting to US$25.45 billion. Despite a surge in reserves atthe end of 2022 thanks to the strong contribution of the "soybean dollar" program for more than US$7,000 million, reserves have been constrained by thecommercial commitments and debt payments that Argentina has to meet. Following a renegotiated agreement, the first disbursement of US$12 billion wasmade on 15 April 2025. This inflow brought Argentina’s international reserves to US$36,799 million. Our results of operations and capital resources may be adversely affected by higher costs of electricity or unavailability or shortages of electricity,or an interruption in energy supplies as well as, increased freight costs. For additional information, please see “Item 3. Key Information—D. Risk Factors—Risks Relating to Our Business and Industry” Political changes and the initial policy actions taken by the current government to stabilize the macroeconomic landscape and curtail publicexpenditure have led to a contraction in activity levels and a dip in private consumption. Consequently, there has been a downturn in cement demand during2024, as cement dispatches dropped by 24% year-on-year to 9.56 million ton, the lowest annual level reported since 2009, according to the Association ofPortland Cement Manufacturers. The trajectory of the construction sector, and accordingly, our company's growth, is contingent upon the effectiveness of the Milei administration'sefforts to normalize critical economic factors, curb inflation, and create an environment that fosters economic development. The realization of such conditionswould likely foster a resumption in the growth of construction activity. E. Critical Accounting Estimates Not applicable. ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES A. Directors and Senior Management Our board of directors (Órgano de Administración) and our board of executive officers (Directors) are responsible for operating our business. Board of Directors Our by-laws provide that our board of directors consists of a minimum of three and up to fourteen members. Our board of directors is thedecision-making body responsible for, among other things, determining policies and guidelines for its business. Our board of directors also supervises its boardof executive officers and monitors the implementation of the policies and guidelines that are established from time to time by our board of directors. The members of our board of directors are elected at general shareholders’ meetings for one fiscal year and are eligible for reelection. Theshareholders’ meeting may also appoint alternate members as substitutes for absent or unavailable members. The terms of all of our current members expire inthe next fiscal year and once the next annual shareholders’ meeting is held in 2025. Our board of directors has a president and in his absence, the vice presidentpresides. 99
Page 109
Table of Contents The president of the board of directors, or the vice president in his or her absence, is the legal representative of Loma Negra. There are no restrictions in our by-laws establishing a minimum age for directors for retirement or non-retirement under an age limit requirement or requiring directors to be our shareholders. Our board of directors is required to meet as often as required by the interests of our company and at least on a quarterly basis. The president orhis alternate may, or at the request of any director shall, call for an extraordinary meeting of the board of directors at any time; provided that if such meeting isnot called by the president or his alternate, it could be called by any other director. Decisions of our board of directors require a quorum of an absolute majorityof members present physically or by any simultaneous electronic media including sounds and images, which permit to clearly determine the identity of thedirectors participating through electronic media in accordance with the applicable law, and any action may be taken by the affirmative vote of an absolutemajority of those that are entitled to vote on such action. In the case of a tie, the vote of the president of the board of directors decides. The following table lists the restated current members of our board of directors appointed by the ordinary shareholders' meeting held on April 23,2025. Name Age Position Independent Years as aBoard Memberas of December 31, 2024 Paulo Diniz 67 President No 8 Sergio Damián Faifman 50 Vice-President No 13 Sergio Daniel Alonso 62 Director Yes 8 Cesar Javier Graña 54 Director Yes 6 Javier Enrique Patron 62 Director No 3 Laura Gé 57 Director Yes 2 Humberto Junqueira de Farias 56 Director No 0 Brief descriptions of the biographical information of the members of our board of directors are presented below. As per section 256 of ArgentineGeneral Companies Law, the special address of our current directors is Cecilia Grierson 355, 4 Floor, City of Buenos Aires, Argentina. The majority of ourdirectors reside in Argentina. Paulo Diniz. Mr. Diniz was appointed as President of our board of directors in April 2023, and he participates as member of our board of directorssince July 2017. Mr. Diniz is a member of the following Loma Negra’s Committee: Results, Finance and Strategy Committee and People and GovernanceCommittee. Mr. Diniz is currently Chief Executive Officer of InterCement Participações, S.A., a leading global cement player, our controlling shareholder. Mr.Diniz is also a member of the board of directors of InterCement Brasil S.A. Paulo has over thirty five years of experience in finance and general management,in companies in Brazil and abroad, such as: Amyris, Inc., Bunge Limited, Carrier Corporation, Cosan S.A., F. Hoffmann-La Roche AG and Telecom Italia. Mr.Diniz received a bachelor’s degree in Industrial Engineering from Politécnica-USP in São Paulo, a master’s degree in Business Administration from IMD inSwitzerland, and a specialization in human resources from INSEAD in France. Sergio Damián Faifman. Mr. Faifman was appointed as member of our board of directors in August 2012. He has also acted as Vice-President ofour board of directors and CEO since November 2016. In addition, Mr. Faifman also currently serves as president of the Boards of Directors of Ferrosur RocaS.A., Cofesur S.A.U. and Recycomb S.A.U., and Vice-President of Loma Negra. Also, he is currently first Vice-President of FICEM (Inter-American CementFederation) which in turn is member of the GCCA. Mr. Faifman is also a member of the Strategy and Finance Committee of InterCement Brasil S.A. (ICB). InMay 2019, Mr. Faifman was appointed Vice-President of the National Association of Portland Cement Producers and the Argentine Institute of PortlandCement, and is currently serving as President of both organizations. Mr. Faifman joined our company in November 1994 and, since then, has held a number ofpositions, including Logistics and Supply Director from June 2015 until November 2016 and Chief Financial Officer between August 2012 and June 2015. Mr.Faifman has also served as Superintendent of Corporate Comptroller at InterCement Brasil from September 2010 until August 2012 and as Comptroller and TaxManager at Loma Negra from May 2006 until September 2010. Mr. Faifman received a bachelor’s degree in Public Accountancy from Universidad de BuenosAires in 1997 and an MBA from Universidad del CEMA in 2002. Currently, he is a member of the following Loma Negra’s Committees: Ethics andCompliance Committee, People and Governance Committee, and Results, Finance and Strategy Committee. Also, he is President of the board of Loma Negra’sFoundation. th 100
Page 110
Table of Contents Sergio Daniel Alonso. Mr. Alonso was appointed as a Member of our board of directors in July 2017. Mr. Alonso is also a Member of the Board ofArcos Dorados (ARCO/NYSE) -the largest independent McDonald´s Master Franchisee globally- since 2008. He has also served as Chief Executive Directorof Arcos Dorados between 2015 and 2019. From 2008 to 2015, Mr. Alonso was Chief Operating Officer, and from 2003 to 2008 he was President ofMcDonald’s Brazil. Arcos Dorados -the largest private provider of First Employment opportunities in Latin America- has been recognized several times as oneof the Top Companies to Work For, according to Great Place to Work (GPTW) Institute. During his tenure in McDonald’s Brazil, he was also President of theInstituto Ronald McDonald, an NGO dedicated to Youth Cancer with active involvement in Public Policies and Fund Raising. Between 1996 and 1999 Mr.Alonso was Director of Commercial Operations for Renault Argentina. Mr. Alonso received a degree as a Certified Public Accountant from Universidad deBuenos Aires, Argentina. Mr. Alonso has completed the Corporate Director Certification Program at Harvard Business School. Mr. Alonso is a member of theBoard of Directors of Universidad Austral de Argentina, where he also serves as Chariman of the Audit and finance Committe Also, Mr. Alonso serves as BoardMember of Loma Negra’s Foundation and is a member of Loma Negra’s Audit Committee, Ethics and Compliance Committee, People and GovernanceCommittee and also chairs the Ethics and Compliance Committee. César Javier Graña. Mr. Graña was appointed as a member of our board of directors in April 2019. He obtained a Licentiate Degree in Economicsfrom Pontificia Universidad Catolica Argentina in 1994, a Master in Finance from Centro de Estudios Macroeconómicos Argentinos (CEMA) in 1995 and aMBA from Harvard University in 2000. Mr. Graña is a Partner in the Strategic Advisory Group at PJT Partners. At PJT Partners Mr. Graña leads the LatinAmerican practice advising clients on strategic transactions including mergers and acquisitons, capital markets and restructuring. Prior to joining PJT Partners,Mr. Graña was a Managing Director and Head of Investment Banking for LatAm ex-Brazil at ItauBBA, the investment banking arm of ItauUnibanco from 2013until 2019. Before joining ItauBBA Mr. Graña spent 13 years at Morgan Stanley in the Mergers & Acquisitions Group in New York, working on a broad rangeof public and private transactions across different industries. During his last year at Morgan Stanley, he was part of Morgan Stanley’s Latin American Groupleading the M&A effort in the region. Before, from 1996 to 1998 he was associate of the Investment Banking Division of Deutsche Morgan Grenfell and,previously, he was analyst of the capital markets division of Banco Rio de la Plata S.A. Mr. Graña serves as board member at Loma Negra’s Foundation and ismember of the Risks and Reputational Committee, the Audit Committee and the Results, Finance and Strategy Committee of Loma Negra. Javier Enrique Patron. Mr. Patrón joined Marval O’Farrell Mairal (the largest law firm in Argentina and a market leader at both local and LatinAmerican level) in 1992 and he has been a partner since 1997. He leads the employment litigation sector and specializes in providing legal support tointernational clients doing business in Argentina. He currently chairs the firm’s labor and employment law department and has been managing partner since2015. He graduated as a lawyer from the Museo Social Argentino University in 1988, where he also worked as an assistant professor in Labor and SocialSecurity Law until 2008. Furthermore, he has also worked as assistant professor at the Universidad de Buenos Aires from 1988 to 2008. Ranked in Band 1 inChambers & Partners Latin America, he is listed as “Leading Lawyer” in Legal 500 and recommended in the Argentina Labor section of Who’s Who Legal &LL250. Mr. Patron also won the LACCA Thought Leader award in Labor Law in 2021 and is listed in the “LACCA Approved 2021” guide. He has also writtennumerous articles in well-known international publications and contributed to the following books: “The International Law Review” and “The InternationalEmployment Law.” In April 2023 he was appointed member of Loma Negra’s Ethics and Compliance Committee and he chairs the Risks and ReputationalCommittee of Loma Negra. Laura Gé. Mrs. Laura Gé was appointed as member of our board of directors and member of the Audit Committee and the Risks and ReputationalCommittee of Loma Negra in April 2023. She is also member of the board of directors of Banco Santander in Argentina, Farmcity S.A., Stein Holding GroupLLC, and Austral Participacoes in Brazil (nominated by the IFC). She also serves as from 2016 as Senior Executive Advisor of Grupo Sancor Seguros andAdvisor of the board of directors of Wiener Lab S.A. She has more than 10 years of experience in management consulting, having led the Buenos Aires andChile offices of Integration Consulting and having served as manager at Hermes Management Consulting and consultant at The Boston Consulting Group. Sheserved as CEO of the outdoor advertising company MECA and she was a member of the Executive Committee at CIMECO, a holding owning Los Andes deMendoza and La Voz del Interior newspapers and serving as board member of these two companies. She served as CEO of the Sunday magazine Rumbos,included in most of the newspapers published in the interior of Argentina. She also has experience in Venture Capital and Private Equity funds, having served asDirector of Pegasus Capital and manager of I5 (part of Hicks, Muse, Tate & Furst group), among others. Mrs. Laura Gé is a Certified Public Accountantgraduated with honors from Universidad de Buenos Aires and she obtained an MBA from Harvard Business School, where she also graduated with honors. Sheis a former leader of Corporate Governance Chapter of IDEA and she performed as member of the organizational committee of several Conferences and theManagement Experience event of such entity. She is a member of the Women Corporate Directors (WCD), the Consultancy Committee of LIDE Argentina anda member of the staff of the 101
Page 111
Table of Contents post-graduate professors at the Administration and Social Sciences Faculty of the University ORT in Uruguay, where she lectures on corporate governance. Shealso serves on the Corven Group Advisory Board and the ABECEB Advisory Board. Humberto Junqueira de Farias. Mr. Junqueira de Farias was appointed as member of our board of directors in April 2025. He is a member of thefollowing Loma Negra’s Committee: Results, Finance and Strategy Committee and Risks and Reputtional Committe. Mr. Junqueira de Farias currently servesas a member of the Board of Directors of Mover Participações, the Advisory Board of Bueno Netto Engenharia, and the Instituto Vencer o Câncer (pro bono).Additionally, he is a Senior Advisor at GeoBiogas & Carbon. Previously, he was a member of the Board of Directors of JBS Global, Eldorado Brasil Celulose,Loga – Logística Ambiental S.A., Essencis Soluções Ambientais S.A., and the Advisory Board of CSBrasil (Grupo Simpar). He also served as CEO of ÂmbarEnergia, Renuka do Brasil, Intercement, Loma Negra (Argentina), and CAVO Serviço e Meio Ambiente S.A., accumulating extensive experience in businessleadership and strategic management. He holds a degree in Civil Engineering and Business Administration from Mackenzie University. He also holds apostgraduate degree in Industrial Administration from Fundação Vanzolini - USP and a specialization in Management from IMD - Switzerland. Furthermore, hecompleted the Advanced Board Member Course at IBGC and is a member of the Young Presidents’ Organization, where he has held the presidency of thePaulista, Metropolitan, and Gold São Paulo Chapters (pro bono). He has experience in various industries, including agribusiness, sanitation, environmentalservices, food, bioenergy, engineering and construction, energy, gas, infrastructure, and building materials. Additionally, he has a strong background in largeorganizations in Brazil and abroad, managing mergers and acquisitions (M&A), internationalization, turnaround processes, crisis management, innovation, andtechnology. He has also participated in the boards of various entities, including SELUR (Union of Urban Cleaning Companies of the State of São Paulo), AFCP(Portland Cement Manufacturers Association in Argentina), SNIC (National Union of the Cement Industry), and ÚNICA (Sugarcane and Bioenergy IndustryUnion). Executive Officers Our executive officers are responsible for the execution of decisions of our board of directors and our day-to-day management within the scope oftheir respective capacity. Our executive officers are elected by the board and may be removed at any time with or without cause by the board of directors. Eachexecutive officer also has individual responsibilities that are determined by the board of directors. Our executive officers are currently as follows: Name Year of Birth Position Year of firstAppointment Sergio Damián Faifman 1974 Chief Executive Officer 2016 Marcos Isabelino Gradin 1972 Chief Financial Officer 2015 Gerardo Oscar Diez 1967 Commercial and ConcreteDirector 2016 Hector Fabian Gerez 1968 Ferrosur Roca S.A. GeneralDirector 2021 Lucrecia Loureiro 1981 Human Resources,Sustainability and LegalDirector 2022 Lucas Amchite 1975 Industrial Director 2025 The business address of our executive officers is Cecilia Grierson 355, 4 Floor, City of Buenos Aires, Argentina. The following are brief biographical descriptions of our executive officers. Sergio Damián Faifman. See “Board of Directors” above. th 102
Page 112
Table of Contents Marcos Isabelino Gradin. Mr. Gradin is our CFO since September 2015. In addition, Mr. Gradin currently serves in the boards of directors ofFerrosur Roca S.A., Cofesur S.A.U. and Recycomb S.A.U. Mr. Gradin served as a member of our board of directors since August 2015 until July 2017. He hasalso served as CFO of Cimpor Spain and Portugal, from January 2013 until August 2015. He joined us in 1998 and has occupied several executive positionswithin our group, including financial manager from June 2006 until January 2013 and CFO from January 1998 until June 2006. Mr. Gradin received abachelor’s degree in Business Administration in 1995 from UCA. He also received a master’s degree in corporate finance from Universidad del CEMA in 2000. Gerardo Oscar Diez. Mr. Diez has acted as our commercial and concrete director since January 2011. Mr. Diez is responsible for our marketingstrategy and commercial relationships. In addition, Mr. Diez also currently serves in the board of Ferrosur Roca S.A., Cofesur S.A.U. y Recycomb S.A.U. Mr.Diez joined our company in May 1992 and, since then, has held a number of positions, including commercial and concrete director, having accumulated morethan 30 years of expertise. Mr. Diez received a bachelor’s degree in Public Accountancy from Universidad de Buenos Aires in 1991 and an MBA fromUniversidad Austral in 2000. Hector Fabian Gerez. Mr. Gerez was appointed as General Director and Vice-President of Ferrosur Roca S.A. in October 2021. He previouslyperformed as manager of the supply chain and logistics at our company from 2005 to 2021, which included the operations at Lomaser’s (our blending,distribution and logistics center which includes a cement mixing plant and distribution and logistics center). Also, he held different positions within the supplychain and logistics area in different jurisdictions in Argentina (e.g. Olavarría, Paraná, Cañuelas). Mr. Gerez joined Loma Negra as a young professional in 1996and he was part of our company from that point to the present. He received an engineering in electricity degree from Universidad Nacional del Sur de BahíaBlanca and during the last years he attended to several courses of logistic development and direction. Lucrecia Loureiro. Ms. Loureiro was appointed in April 2022 as Human Resources, Sustainability and Legal Director. Previously she was ourdirector of legal and corporate affairs since March 2021. Ms. Loureiro joined us in 2011 and, since then, has held several positions in our legal department andas Compliance Officer of the company. Ms. Loureiro has wide-ranging experience in capital markets, corporate, labor, financial and commercial matters as wellas active participation in international investment projects. Besides the legal affairs, she was also in charge of our compliance program and is currently incharge of the sustainable practices, public affairs, communications of the company, and the Fundación Loma Negra Para el Desarrollo Sustentable. Ms.Loureiro is currently serving as director of Ferrosur Roca and as Vice President of Fundación Loma Negra para el Desarrollo Sustentable. Ms. Loureiroreceived a law degree from the University of Buenos Aires in 2005. She completed graduate coursework in a master’s program in economic business law atUCA between 2008 and 2009 and she participated on the international exchange program in Tilburg University of Netherlands in 2009. During 2012 and 2013she attended a program for the development of organizational skills at Universidad del CEMA. In 2014 she was part of the leadership challenges program ofUniversidad de San Andrés. In 2020 she attended a development executive program at Di Tella University. In addition, she participated in several specializationcourses on leadership, coaching and development of organizational competencies. Lucas Ariel Amchite. Mr. Amchite is our Director of Operations since April 2025 and is responsible for the management and operations of ourintegrated plants and grinding facilities. In addition, he is responsible for the company's Engineering, Technology and Processes and Maintenance Area. Mr.Amchite joined our company in February 2000, were he held a number of positions at our industrial units and was the plant manager of our San Juan plant fromJanuary 2015 until November 2019. On November 2019 he was appointed as Industrial Manager of Yguazu Cementos S.A. (a formerly subsidiary of ourCompany sold during 2020). Mr. Amchite received a bachelor degree in Mechanical Engineering from Universidad Nacional de Mar del Plata in 1999. B. Compensation Executive Officers Our executive officers receive compensation for the services they provide. The aggregate cash compensation paid to all members of seniormanagement as a group was Ps. 3,608 million in 2024 and Ps. 4,728 million in 2023. Additionally, Ps. 768 million and Ps.1,518 million have been accrued aslong-term incentive program during the fiscal years ended December 31, 2024 and 2023, respectively (See Note 19 of our consolidated financial statements). The cash compensation for each of our executive officers is comprised mainly of base salary and bonus. Base salary may be reviewed andadjusted according to the fluctuations in the labor market. Bonuses are determined based on business results and paid once a year. In addition, our executiveofficers are eligible to participate in welfare benefit 103
Page 113
Table of Contents programs, including medical, life and disability insurance. We believe that the compensation awarded to our executive officers is consistent with that of ourpeers and similarly situated companies in the industry in which we operate. Directors and Supervisory Committee Our shareholders fix the compensation of our directors and members of our supervisory committee, including additional wages which may arisefrom the directors’ performance of any administrative or technical activity. Compensation of our directors and members of our supervisory committee isregulated by the Argentine General Companies Law and the CNV regulations. Section 261 of the Argentine General Companies Law provides that thecompensation paid to all directors and members of the surveillance committee in a year may not exceed 5.0% of net profit for such year, if the company is notpaying dividends in respect of such net profit. The Argentine General Companies Law increases the annual limitation on director compensation to up to 25.0%of net profit based on the amount of dividends, if any, that are paid. In the case of directors that perform duties at special commissions or perform administrativeor technical tasks, these limits may be exceeded if approved at a shareholders’ meeting, the issue is included in the agenda, and is in accordance with theregulations of the CNV. In any case, the compensation of all directors and members of the supervisory committee requires shareholders’ ratification at anordinary shareholders’ meeting. During the annual ordinary shareholders’ meeting held on April 23, 2025, the shareholders approved total directors’ compensation of Ps. 1,772million (nominal values) and total fees for the members of our supervisory committee of Ps. 50.7 million (nominal values), for services rendered during 2024. During the annual ordinary shareholders’ meeting held on April 25, 2024, the shareholders approved total directors’ compensation of Ps. 868million (nominal values) and total fees for the members of our supervisory committee of Ps. 14.7 million (nominal values), for services rendered during 2023. During the annual ordinary and extraordinary shareholders’ meeting held on April 25, 2023, the shareholders approved total directors’compensation of Ps. 359 million (nominal values) and total fees for the members of our supervisory committee of Ps. 6.2 million (nominal values), for servicesrendered during 2022. Certain members of our board of directors who are also our employees or employees of our subsidiaries do not receive any additionalcompensation for their service on our board of directors. We believe that our director fee structure is customary and reasonable for companies of our kind andconsistent with that of our peers and similarly situated companies in the industry in which we operate. These fees may be increased from time to time by aresolution of the general meeting of shareholders. As of the date of this annual report, neither we, nor any of our affiliates, have entered into any agreement that provides for any benefit orcompensation to any director after expiration of his or her term. Adoption of Clawback Policy Effective as of November 8, 2023, our board of directors has adopted the Policy for Recovery of Erroneously Awarded Compensation (the "ClawbackPolicy"). The Clawback Policy is administered by our board of directors (by a majority of independent directors serving on the board), and was adopted incompliance with Section 10D of the Exchange Act and applicable rules of the NYSE. The Clawback Policy provides that "Erroneously AwardedCompensation" can be recovered from executive officers following an accounting restatement" due to material noncompliance with financial reportingrequirements. The policy applies to incentive-based compensation received by an executive officer under specific conditions, including the timing of thecompensation and the officer's service period. It includes provisions for attestation by executive officers, outlines exceptions to recovery, and states that thepolicy is binding and enforceable against all executive officers and, where required, their legal representatives. A copy of this policy is included as Exhibit 97.1to this annual report. Long-Term Incentive Program Phantom Stock Plan On January 24, 2018 our board of directors established the long-term incentive program, or the incentive program, with the purpose of attracting,retaining and motivating certain hierarchical employees by providing them incentives directly linked to shareholder value. The incentive program had an annualfrequency, with granting of phantom stock rights occurring in the month immediately following the publication of our audited consolidated financial statementsfor the previous fiscal year. Such options were granted in the framework of an annual plan. Grants were determined by our 104
Page 114
Table of Contents board of directors. This program was terminated by resolution of our board of directors adopted on February 12, 2021. However, the annual plans that havealready been granted within this program will remain in force. Program administration. Our board of directors is responsible for the overall supervision of the incentive program with the support of adesignated management committee, or the management committee, and our management. Only the board of directors has deliberative powers over the incentiveprogram. The management committee is composed of members of our board of directors and, when necessary, advised by executive officers from specific areas(i.e., financial, legal) and external consultants who support our board of directors in the review of proposals for each grant in terms of eligible participants,number of awards, exercise price of each program, among others. Eligibility. Board members and senior management of Loma Negra and a limited number of senior employees indicated by senior management areeligible for awards under the incentive program. Awards. Awards consist of the granting of phantom stock rights, which consist in rights to future cash-based awards, based on the valuation of lotsof common shares from a predetermined price, or exercise price, and for a certain period, or option term. The exercise of the options provides its beneficiariesthe possibility of obtaining an economic benefit calculated by reference to the increase in the value of the phantom stock rights between the date of granting ofeach plan to the date of exercise of the option. Exercise price. The exercise price will be defined at the time the awards are granted and will be held until the end of the option term. The exerciseprice will be equivalent to the average closing value of the common shares in the form of ADSs traded on the NYSE in the 60 days prior to the date of grantingthe phantom stock rights. The exercise price of the first grant will be equal to the initial public offering price. The share appreciation target will be defined ateach grant based on a proposal from the management committee to be reviewed and approved by the board of directors. Vesting period. The phantom stock rights shall vest and become exercisable on a staggered basis with no phantom stock rights vesting during thefirst two years of the individual grant and 1/3 of the phantom stock rights vesting during each subsequent year. Participants may exercise their vested rightsevery quarter after the publication of our quarterly financial statements, once the non-vesting period established by the board of directors has expired. Option term. The incentive program has an option term of ten years, commencing from the granting of awards. The term of the award representsthe maximum term in which the participant must exercise the right. After this period, the phantom stock rights not exercised will become null and void. As of the date of this annual report, we granted to some of our directors and executive officers the amount of 188,786 phantom stock rights for the2017 plan duly approved in 2018, 103,085 phantom stock rights for the 2018 plan approved in 2019 and 451,299 phantom stock rights for the 2019 planapproved in 2020. The phantom stock rights will mature one-third each year on the second, third and fourth anniversary of the award. All of the beneficiaries haveaccepted the phantom stock rights granted to them. The number of phantom stock rights granted pursuant to the 2017 plan was calculated on the basis of anADS price of US$19.0. The number of phantom stock rights granted pursuant to the 2018 plan was calculated on the basis of an ADS price of US$8.5. Thenumber of phantom stock rights granted pursuant to the 2019 plan was calculated on the basis of an ADS price of US$5.8. This Phantom Stock Incentive Program is no longer in place as amended by the board of directors’ meeting held on February 12, 2021 andtherefore was replaced by another compensation plans. However, the annual plans that have already been granted within this program will remain in force. OnFebruary 1, 2023 and on February 19, 2024 the amount equivalent to 250,655 share rights and the amount equivalent to 123,458 share rights, respectively,corresponding to the program for the year 2019, were executed. With the exercise of these rights, the plan corresponding to 2019 was paid in full. Stock-based compensation plans On February 12, 2021 our board of directors established two long-term stock-based plans that replaced the Phantom Stock Incentive Programapproved by our board of directors on January 24, 2018. 105
Page 115
Table of Contents (i) Stock Compensation Plan Program administration. The program is managed by our board of directors, who is responsible for its overall supervision. The board of directorsmay delegate the management and implementation of the plan to the human resources department, but only the board of directors has deliberative powers overthe incentive program. Implementation of the programs and granting of the plans are subject to applicable law. Eligibility. Board members, executive directors and senior management of Loma Negra to the extent that, in all cases, hold a labor relationshipwith us. Awards. Awards consist of the granting of our ordinary shares and/or ADSs, and/or to alternatively settle it in the equivalent value in cash at thecompany's discretion (as per the modification made on November 6, 2024). Vesting. The ordinary shares and/or ADSs under each plan will be delivered to the beneficiary pursuant to the following schedule (to the extentthat, as of each vesting date the beneficiary continues holding a labor relationship with us): (a) January 1st of the next year immediately following the awarddate: 33% of the ordinary shares and/or ADSs awarded; (b) January 1st of the second year immediately following the award date: 33% of the ordinary sharesand/or ADSs awarded; and (c) January 1st of the third year immediately following the award date: 34% of the ordinary shares and/or ADSs awarded. On February 12, 2021 the board meeting that established the two long-term stock-based plans, also approved the granting of a total amount of10,069 ADRs corresponding to the 33% of the first installment of the first year. Such amount was distributed on January 5, 2022. On January 2, 2023 17,473ADRs were distributed, corresponding to the 33% of the second installment of the plan for the year 2021 and 33% to the first installment of the plan for the year2022. On January 3, 2024, 25,650 ADRs were distributed corresponding to the 34% of the third installment of the plan for the year 2021, 33% to the secondinstallment of the plan for the year 2022 and 33% to the first installment of the plan for the year 2023. On January 6, 2025, the cash equivalent to 27,336 ADRswas paid to the corresponding employees. This distribution included 34% of the third installment for the year 2022, 33% of the second installment for the year2023, and 33% of the first installment for the year 2024. The distributions made during 2025 were paid in cash equivalents. The board of directors may terminate the program at any time. (ii) Total Shareholder Return Stock Compensation Plan Program administration. The program will be managed by our board of directors, who will be responsible for its overall supervision. The board ofdirectors may delegate the management and implementation of the plan to the human resources department, but only the board of directors hasdeliberative powers over the incentive program. Implementation of the programs and granting of the plans are subject to applicable law. Eligibility. Board members, executive directors and senior management of Loma Negra to the extent that, in all cases hold a labor relationshipwith us. Awards. Awards consist of the granting of our ordinary shares and/or ADSs in a number to be determined by reference to the Total ShareholderReturn (TSR) as calculated in the manner contemplated in the program. Vesting. Within the 10 business days following our shareholders meeting approving our annual financial statements for the fiscal period ending onthe third fiscal year following the awarding date (including as first fiscal year the one at which the plan is awarded). On March 18, 2024, 39,974 ADRs were distributed for the program corresponding to the year 2021. Subsequently, on March 10, 2025, a cashpayment equivalent to 22,952 ADRs was made to the corresponding employees under the same 2021 program. The board of directors may terminate the program at any time. C. Board Practices Duties and Liabilities of Directors Directors have the obligation to perform their duties with the loyalty and the diligence of a diligent business person. Under Argentine legislation,directors are jointly and severally liable to the company, the shareholders and third 106
Page 116
Table of Contents parties for the improper performance of their duties, for violating any law or the bylaws or regulations, if any, and for any damage to these parties caused byfraud, abuse of authority or gross negligence. The following are considered key actions to assess a director’s duty of loyalty: (i) the prohibition on usingcorporate assets and confidential information for private purposes; (ii) the prohibition on taking advantage, or allowing another to take advantage, by action oromission, of the business opportunities of the company; (iii) the obligation to exercise board powers only for the purposes for which the law, the corporation’sbylaws or the shareholders’ or the board of directors’ resolutions were intended; and (iv) the obligation to take strict care so that acts of the board do not go,directly or indirectly, against the company’s interests. A director must inform the board of directors and the supervisory committee of any conflict of interestshe/she may have in a proposed transaction and he/she must abstain from deliberating and voting thereon. In general, a director will not be held liable for a decision of the board of directors, even if that director participated in the decision or hadknowledge of the decision, if (i) there is written evidence of the director’s opposition to the decision and (ii) the director notifies the supervisory committee ofthat opposition. However, both conditions must be satisfied before the liability of the director is claimed before the board of directors, the supervisorycommittee or the shareholders or relevant authority or the commercial courts. Section 271 of the Argentine General Companies Law allows directors to enter into agreements with the company that relate to such director’sactivity and under arms’ length conditions. Agreements that do not satisfy any of the foregoing conditions must have prior approval of the board of directors (orthe supervisory committee in the absence of board quorum), and must be notified to the shareholders at a shareholders’ meeting. If the shareholders reject theagreement, the directors or the members of the supervisory committee, as the case may be, shall be jointly and severally liable for any damages to the companythat may result from such agreement. Agreements that do not satisfy the conditions described above and are rejected by the shareholders are null and void,without prejudice to the liability of the directors or members of the supervisory committee for any damages to the company. The acts or agreements that a company enters into with a related party involving a relevant amount should fulfill the requirements set forth inSection 72 and 73 of the LMC. Under Section 72, the term “related party” includes the directors, the members of the audit and supervisory committee, thespecial or general managers designated pursuant to Section 270 of the Argentine General Companies Law (as well as their ascendants, descendants, spouses,brothers or sisters) and the companies in which any of the aforementioned persons may have a direct or indirect significant ownership. A relevant amount isconsidered to be an amount which exceeds 1% of the net worth of the company as per the latest balance sheet. Under the CNV Rules, a person has a“significant ownership” when the person owns shares that represent no less than 15% of the total capital of such company, or a lesser ownership and the right todesignate one or more directors per class of shares, or agreements with other shareholders regarding the management or corporate governance of the companyor its controlling entity. The board of directors or any of its members shall require from the audit committee a report stating if the terms of the transaction maybe reasonably considered adequate in relation to normal market conditions. The company may resolve with the report of two independent evaluating firms thatshall have informed about the same matter and about the other terms of the transaction. The board of directors shall make available to the shareholders thereport of the audit committee or the independent evaluating firms, as the case may be, at the main office one business day after the board’s resolution wasadopted and shall communicate such fact to the shareholders of the company in the respective market bulletin. The vote of each director shall be stated in theminutes of the board of directors approving the transaction. The transaction shall be submitted to the approval of the shareholders of the company when theaudit committee or both evaluating firms have not considered the terms of the transaction to be reasonably adequate in relation to normal market conditions. Inthe case where a shareholder demands compensation for damages caused by a violation of Section 73, the burden of proof shall be placed on the defendant toprove that the act or agreement was in accordance with the market conditions or that the transaction did not cause any damage to the company. The transfer ofthe burden of proof shall not be applicable when the transaction has been approved by the board of directors with the favorable opinion of the audit committeeor two evaluating firms. We may initiate causes of action against directors if so decided at a meeting of the shareholders. If a cause of action has not been initiated withinthree months of a shareholders’ resolution approving its initiation, any shareholder may start the action on behalf and on our account. A cause of action againstthe directors may be also initiated by shareholders who object to the approval of the performance of such directors if such shareholders represent, individuallyor in the aggregate, at least 5% of our capital stock. Except in the event of our mandatory liquidation or bankruptcy, shareholder approval of a director’s performance, or express waiver or settlementapproved by the shareholders’ meeting, terminates any liability of a director 107
Page 117
Table of Contents vis-à -vis the company, provided that shareholders representing at least 5% of our capital stock do not object and provided further that such liability does notresult from a violation of law or our bylaws. Under Argentine law, the board of directors is in charge of the company’s management and administration and, therefore, makes any and alldecisions in connection therewith, as well as those decisions expressly provided for in the Argentine General Companies Law, the company’s bylaws and otherapplicable regulations. Furthermore, the board is generally responsible for the execution of the resolutions passed in shareholders’ meetings and for theperformance of any particular task expressly delegated by the shareholders. Supervisory Committee Our supervisory committee (Comisión Fiscalizadora) consists of three members appointed at our shareholders’ meeting for a term of one year.Members may be reelected. The primary responsibility of our supervisory committee is to supervise the compliance by our management with Argentine law andwith our bylaws as well as to review our financial statements and to report their findings to our shareholders. Our supervisory committee is required to elect apresident among its members and shall meet every quarter and at any time when called by its president. Decisions of the supervisory committee require aquorum of a majority of members and are taken by a majority vote. According to the LMC and our bylaws, the supervisory committee may be rescindedprovided that an Audit Committee was duly appointed. The decision to rescind the appointed supervisory committee must be passed by an extraordinaryshareholders' meeting with a quorum 75% of the shares entitled to vote and with the majority of 75% of votes -without applying the plurality of votes of theshares entitled to vote. The following table lists the current members of our supervisory committee, who were elected at a shareholders’ meeting held on April23, 2025: Name Year ofAppointment PositionHeld Age Antonio Juan Lattuca 2025 Member 82 Omar Raúl Rolotti 2025 Member 78 Adriana Irene Calvo 2025 Member 62 Claudio Aldo Forti 2025 Alternate 61 Carlos Roberto Chiesa 2025 Alternate 56 José Alanis 2025 Alternate 87 Committees of the Board of Directors Our board of directors has established an Audit Committee as well as other committees as described below. We expect our board of directors tohave such other committees as the board of directors may determine from time to time. Audit Committee Our Audit Committee is composed of three members, all designated by our board of directors. All members of the audit committee were appointedby our board of directors on April 23, 2025, and their terms will expire at the next annual shareholders meeting. The following table provides relevantinformation about the members of our audit committee: Name Position Age ElectionDate Condition Laura Gé Permanent 57 2025 Independent Sergio Daniel Alonso Permanent 62 2025 Independent Cesar Javier Graña Permanent 54 2025 Independent As of the date of this annual report, all of the members of our audit committee are independent under CNV regulations, Rule 10A-3 under theExchange Act, or Rule 10A-3, and the applicable NYSE standards. In addition, our board of directors has determined that each of the members of our AuditCommittee is “financially literate” within the meaning of the rules of the NYSE and that Cesar Javier Graña is an “audit committee financial expert” within themeaning of Item 16A of Form 20-F under the Securities Act and has the requisite accounting or related financial management expertise under the rules of theNYSE. 108
Page 118
Table of Contents Our Audit Committee’s primary responsibilities are to assist the board of directors’ oversight of: (1) the integrity of our financial statements; (2)the adequacy and integrity of the accounting and financial reporting processes and internal controls systems for the issuance of financial reports, and themonitoring of such internal controls; (3) the identification and monitoring of our risks and risk management policies; (4) the standards and procedures related toethics and conduct and our internal policies and channels for addressing complaints and concerns confidentially and anonymously raised by employeesregarding accounting, internal controls and auditing matters and for the receipt, treatment and investigation of those concerns; (5) the external and internalaudits, as well as the engagement of the independent auditor and the evaluation of qualifications, services, performance and independence of our independentauditor; (6) our compliance with legal and regulatory requirements; and (7) perform other duties attributed by law or by our company’s bylaws”. We adopted anAudit Committee charter defining the committee’s primary duties in a manner consistent with the rules of the SEC and the NYSE, which is available on ourwebsite at www.lomanegra.com. Disclosure Policy Committee In January 2018, our board of directors created the Disclosure Policy Committee to manage compliance with ongoing disclosure rules andregulations promulgated by the SEC under the U.S. Sarbanes-Oxley Act of 2002 and Regulation FD promulgated by the SEC under the Securities ExchangeAct of 1934. The committee is composed of five members: chief executive officer, chief financial officer, legal and corporate affairs director, head of corporatecommunications and investor relations manager. The committee monitors compliance with regulations and our disclosure policy and advises the company oncommunications with external and internal audiences. Its main purpose is to obtain input from the company’s spokespersons on disclosure issues and to assureagreement on management’s messages and policies. This committee meets quarterly in advance of each earnings announcement or whenever there are issuesthat require consideration. Securities Operations Approval Committee Our insider trading policy committee establishes the policies and procedures that govern trading by our personnel of our securities and securitiesof any other company about which such personnel learns material, non-public information in the course of performing his or her duties for our company. All ourdirectors, officers and other employees, supervisory board members, controlling shareholders and their representatives and/or employees, and any other persondesignated by the securities compliance officer, are subject to the prohibitions set forth in the insider trading policy. Pursuant to this policy, certain of our officers and employees as well as any person specially designated by the securities compliance officer mustinform and request for approval to the securities operations approval committee of any operation that they intend to carry out with our securities. The committee comprises the chief executive officer, chief financial officer, the commercial and concrete director; and the legal and corporateaffairs director. Ethics and Compliance Committee The ethics and compliance committee, consisting of members of the board of directors, at least one of them being an independent director, andmembers of our management, is responsible, jointly with the ethics and compliance officer, for administering the code of business conduct, designing andapproving the compliance program and investigating any infringement of the code and of applicable laws and regulations. People and Governance Committee This committee was created by our board of directors on May 9, 2019 and is composed by members of the board of directors, at least one of thembeing an independent director. The people and governance committee is currently chaired by one of our independent directors. The committee’s primaryresponsibilities are: (i) defining our governance model (reviewing bylaws, regulations, internal policies, committees, structure and organization); (ii) evaluatingand proposing of the members of the board of directors; (iii) designing human resources guidelines and processes; (iv) evaluating of the remuneration ofleadership positions and directors; and (v) developing succession plans for leadership positions and directors. 109
Page 119
Table of Contents Results, Finance and Strategy Committee The results, finance and strategy committee was created by our board of directors on May 9, 2019 and is composed by members of the board ofdirectors, at least one of them being an independent director. The results, finance and strategy committee’s primary responsibilities are: (i) defining ourcompany’s goals; (ii) reviewing the budget and monitoring results and cash flow; (iii) reviewing our results disclosure policy; (iv) supporting the managementof our business; (v) discussing financial planning; (vi) management of opportunities in current businesses; (vii) capital expenditures management and planning;and (viii) analysis of new business opportunities and projects. Risk and Reputation Committee The risk and reputation committee was created by our board of directors on May 9, 2019, and is composed by members of the board of directors,and at least one is an independent director. This committee’s primary responsibilities are: (i) monitoring corporate image management; (ii) reviewing integratedrisk map; (iii) designing crisis contingency plan; and (iv) overseeing community relations and donations. D. Employees As of December 31, 2024 we had a total of 2,821 employees. We have collective bargaining agreements with the union that represents our bluecollar employees in the cement industry, or AOMA. Certain of our subsidiaries have collective bargaining agreements with unions that represent theiremployees in the railway transportation (APDFA, La Fraternidad and Unión Ferroviaria), in the chemical industry (FESTIQyPRA), and in the constructionindustry (UOCRA). The Company has no significant labor conflicts. In the past four years, the Company has not experienced any specific strike affecting all itsoperations and, consequently, we have not lost any working days in 2024 due to union actions. As of December 31, Business Segment 2024 2023 2022 Cement 1,424 1,415 1,421 Concrete 263 285 278 Aggregates 71 74 63 Railroad 1,028 1,077 1,090 Others 35 34 34 Total 2,821 2,885 2,886 E. Share Ownership None of our directors or executive officers beneficially owns one percent or more of our ordinary shares as of the date of this annual report. See"Item 6 B. Compensation - Long-Term Incentive Program", Directors, senior management and employees for any arrangement that involves the issue or grant ofoptions, shares or securities of our company. F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation Not Applicable ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS A. Major Shareholders The following table sets forth information regarding the beneficial ownership of our outstanding shares, which may be represented by ADSs, as ofMarch 31, 2025, by: • each person or group of affiliated persons that, to our knowledge, beneficially owns 5% or more of our ordinary shares; and • all of our directors and executive officers as a group. As disclosed in “Item 6.E. Share Ownership,” none of our directors or executive officers beneficially owns one percent or more of our ordinaryshares as of the date referenced above . The beneficial ownership of our ordinary 110
Page 120
Table of Contents shares, including shares in the form of ADSs, is determined in accordance with the rules of the SEC and generally refers to the sole or shared power to vote ordirect the voting or to dispose or direct the disposition of any security. For purposes of this table, a person is deemed to be the beneficial owner of securities thatcan be acquired within 60 days from March 31, 2025, through the exercise of any option or warrant. The amounts and percentages are based upon 583,483,151ordinary shares as of March 31, 2025. All of our shareholders, including the shareholders listed below, have the same voting rights attached to their shares, including shares in the formof ADSs. See “Item 10.B Additional Information—Memorandum and Articles of Association—Description of Capital Stock—Bylaws—Voting Rights”. Unlessotherwise indicated below, to our knowledge, all persons named in the table have sole voting and investment power with respect to their shares, except to theextent authority is shared by spouses under community property laws. The table below sets forth information concerning the beneficial ownership of our ordinary shares as of March 31, 2025: Shares Beneficially Owned Name of Beneficial Owner Number Percentage of ourCapital Stock IC Trading Inversiones Argentina, S.L. 304,233,740 52.1 ANSES 31,076,151 5.3 Directors and Executive Officers as a Group * * ________________(1) Based on information provided by IC Trading Inversiones, it owns and controls 100% of the voting shares of IC Trading Inversiones Argentina.InterCement Portugal S.A. owns and controls 100% of IC Trading Inversiones. InterCement Participações S.A. owns and controls 99.5% of the sharecapital of InterCement Portugal S.A. Mover Participações S.A. (formerly named Camargo Corrêa S.A.) owns and controls 95.73% of InterCementParticipações S.A.’s voting shares. Participações Morro Vermelho S.A. owns 99% of the common shares and 99% of the preferred shares of MoverParticipações S.A. (2) The amount of shares owned by the National Social Security Association of Argentina (Administración Nacional de la Seguridad Social), or the ANSES,is based on the information provided by ANSES to the company to attend to the annual ordinary shareholders' meeting held on April 23, 2025. * Individually each owning less than 1% of our outstanding ordinary shares. Other than IC Trading Inversiones Argentina, S.L. and ANSES, we are not aware of any person that is the beneficial owner of five percent or moreof our voting securities. Significant Changes in Percentage Ownership To our knowledge, there have been no significant changes in the percentages of ownership held by the major shareholders listed below, except asdisclosed below, which disclose certain internal restructurings within our controlling shareholder. On January 21, 2020 Caue Austria Holding GmbH notified to Caja de Valores of the transfer of all of its ownership in the company (i.e.304,233,740 ordinary shares) to Intercement Trading e Inversiones, S.A., its direct parent company. On June 4, 2020, Intercement Trading e Inversiones S.A. granted a first priority pledge over all of its shares of Loma Negra (which, as of the dateof this annual report, represent 52.14% of Loma Negra´s capital stock) in favor of Planner Trustee DTVM Ltda. The aforementioned pledge was granted assecurity for the obligations assumed by its indirect shareholder, Intercement Participações S.A., and its subsidiary, Intercement Brasil S.A., regarding theissuance of simple debentures, not convertible into shares, in accordance with the public offering regulations of Brazil for a total amount of BRL 4,676,827,000to refinance its financial debt. In this sense, on June 5, 2020, Intercement Trading e Inversiones S.A. requested to Caja de Valores the registration of the pledge. (1) (2) 111
Page 121
Table of Contents On January 6, 2021, Intercement Trading e Inversiones, S.A. notified to Caja de Valores of the transfer of all of its ownership in the company (i.e.304,233,740 ordinary shares) to its subsidiary Intercement Trading e Inversiones Argentina, S.L. On April 25, 2023, the annual ordinary and extraordinary shareholders meeting approved a capital reduction in the amount of 12,543,339 ordinaryshares, i.e., from 596,026,490 to 583,483,151 ordinary shares. Therefore, as of the date of this annual report, Intercement Trading e Inversiones Argentina, S.L.holds 304,233,740 ordinary shares, representing 52.14% of our share capital. On February 23, 2024, Intercement Participações S.A. announced that it had received a series of inquiries and offers with respect to its assets. Inaddition, our controlling shareholder informed that it had engaged with advisors to assist in evaluating strategic alternatives (such as private placement, merger,or partnership with a strategic player, or a potential divestment), and that a competitive process had been organized and was underway. As of the date of thisannual report, our controlling shareholder has not released any additional information. On May 1, 2024, our controlling shareholder entered into an exclusivity agreement with Companhia Siderúrgica Nacional (CSN) for the potentialacquisition of all outstanding shares of Intercement Participações S.A. After several extensions, this agreement was terminated following our controllingshareholder’s decision to file for judicial reorganization (recuperação judicial) on December 3, 2024, as prior extrajudicial reorganization efforts failed. The judicial reorganization process aims to restructure our controlling shareholder’s financial obligations. While its duration and outcome remainuncertain, it is possible that a change of control with respect to us may occur. For further information about the impact of a change of control pursuant to regulations in force in Argentina, see “Exhibit 2.2 Description ofRegistrant’s Securities” B. Related Party Transactions We enter into transactions with our shareholders and with companies that are owned or controlled, directly or indirectly, by us in the normalcourse of our business. We conduct these transactions on an arms’ length basis. Any transactions with related parties have been made consistent with normalbusiness operations using terms and conditions available in the market and are in accordance with the applicable legal standards. Those transactions wereeliminated in the consolidation process. We maintain certain agreements with other companies controlled by our controlling shareholder in the ordinary course of business in order toshare costs and expenses related to the use and maintenance of certain shared administrative functions. These transactions comply at all times with legalrequirements regarding conflict of interests and are monitored closely by our management. As of the date of this annual report, we do not have any loans or other financing agreements with any of our directors and executive officers.Please refer to the below disclosure and “Note 19 to our audited consolidated financial statements” included elsewhere in this annual report for moreinformation. Other Transactions Know-how Offer Letter with InterCement Participações S.A. On August 28, 2020, we accepted an offer from Intercement Participações S.A. (the “Offer”) for the transfer of technical know-how relating to thedesigning and manufacturing of building materials, such as cement, clinker, and concrete, among others, for the purpose of optimizing the performance and theoperations of our company. According to the terms of the Offer, we will have access to the know-how possessed and developed by InterCement ParticipaçõesS.A., such as, technology, engineering, development of management systems to enhance performance and processes, industrial sustainability and innovation.The royalty fee for the transfer of technical know-how represents 1% of our company’s revenues in nominal values not adjusted for inflation pursuant to ourunconsolidated financial information for each year of validity of the Offer and will be paid on a quarterly basis. The Offer shall remain in force for an initialperiod of three years and shall thereafter be renewed automatically for further successive one-year periods unless either party terminates the Offer by giving tothe other party not less than three months’ prior notice. These transactions comply with legal requirements regarding conflict of interests, are conducted on anarms’ length basis and are monitored closely by our management. This contract ended in August 2023. 112
Page 122
Table of Contents Offer Letter Services from Loma Negra to InterCement Participacoes S.A. On September 29, 2021 InterCement Participacoes S.A. accepted our offer regarding the provision of services to themselves or to any othercompany of the InterCement Group on its behalf (the “Services”). Such Services included, but were not limited to: development and implementation ofperformance management, optimization and operational progress tools, technical support in the areas of process engineering, geology, raw materials,maintenance, products and quality, technical training of managers, engineers, and technicians and prospecting of new international business (due diligences).The fees for the Services represented (i) the Net Costs (meaning all costs in which we incurred in connection with providing the Services); plus (ii) an arm’slength return for all Services levied at 8%. The term of the agreement was three years starting September 2021. The agreement expired on September 2023, inaccordance with its terms. C. Interests of Experts and Counsel Not applicable. ITEM 8. FINANCIAL INFORMATION A. Consolidated Statements and Other Financial Information See Item 18 and our audited consolidated financial statements as of December 31, 2024 and 2023 and for the three years ended December 31,2024, 2023 and 2022 included in this annual report. Legal Proceedings We were party to various legal and administrative proceedings, including civil and labor claims filed by former employees and subcontractors’employees and public authorities relating to overtime payments, paid leave, working hours, safety, occupational accidents and compensation for exposure tohealth hazards and tax claims. As of December 31, 2024, such claims involved a total amount in controversy of approximately Ps. 15,185 million, of which Ps.3,796 million corresponded to probable claims, Ps. 10,861 million to possible claims, including mainly Ps. 306 million related to tax contingencies, Ps. 4,308million in labor contingencies and Ps. 6,247 million in administrative, commercial and other proceedings. The remaining Ps. 528 million corresponded toremote claims. It is our policy to make provisions for legal contingencies when, based upon our judgment based on the advice of our legal advisers, the risk ofloss is probable. As of December 31, 2024, we had established a provision in the amount of Ps. 3,796 million to cover contingencies for proceedings for whichthe risk of loss was deemed probable. Moreover, as of December 31, 2024, we also made judicial deposits in the amount of Ps. 36,3 million, related to theseproceedings. For claims where we did not record any estimated liability, we will continue to evaluate information as it becomes known and will record anestimate for losses at the time or times if and when it is probable that a loss will be incurred and the amount of the loss is reasonably estimable. As of December 31, 2024, there were no other material contingencies that could negatively impact our financial results. The following table summarizes legal and administrative proceedings to which we are party, the amounts in dispute in these proceedings and theaggregate amount of the provision established for losses that may arise from these proceedings: As of December 31, 2024 Number ofproceedings TotalClaims TotalProvisions (in millions of Ps.) Labor and Social Security Proceedings 175 7,031.0 2,577.0 Civil and other proceedings 203 8,154.0 1,219.0 Total 378 15,185.0 3,796.0 See Note 26 of our consolidated financial statements in relation with possible contingencies for which we have not recorded a provision as it is notrequired under IFRS Accounting Standards. Damnificados Financieros Asociación Civil’s Class Action 113
Page 123
Table of Contents On February 27, 2007, Damnificados Financieros Asociación Civil filed a class action as representative of the holders of the notes issued byInversora Eléctrica de Buenos Aires S.A., or IEBA, in an aggregate principal amount of Ps. 200,000,000, in 1997, or the IEBA Notes, against severaldefendants (including us, as a former minority shareholder of IEBA). Plaintiff seeks to extend liability to the defendants for the lack of payment of the IEBANotes alleging, among other things, under-capitalization of IEBA, as issuer. We filed several defenses, including, without limitation, lack of standing to sue,statute of limitations, that we were no longer shareholders of IEBA at the time of the issuance of the IEBA Notes and that the IEBA Notes have beensuccessfully restructured through a reorganization plan duly endorsed by the competent court with effect against all holders of the IEBA Notes and declaredfulfilled by resolution of the same court dated April 18, 2008. On August 28, 2017, the Court admitted the class action and as of September 5, 2017, weappealed the Court’s decision. The Court rejected such appeal, thus on September 28, 2017, we filed a petition in error because of denial of appeal. Finally, thepetition in error was admitted. As of August 14, 2018, the Court decided to confirm the appealed resolution regarding the admission and certification of theclass action and order its registration in the Public Registry of Collective Processes (Registro Público de Procesos Colectivos). In 2019, the Court order topublish notice of the class action in the media. On September 2020, the publications’ project filed by the plaintiff was approved and in December 2020, theplaintiff certified the publication of the class action in its social media. On April 4, 2021, plaintiff requested the Court to open the evidentiary stage. On June 4,2021, the Court deferred the ruling on defendants’ defenses until passing final judgment and ordered to send the docket to the Public Prosecutor. On August 28,2021, the Court received the opinion of the Public Prosecutor. On September 16, 2021, the Court requested the parties to state whether a settlement would bepossible. The parties answered the Court’s request. On March 3, 2022, after examining the proceedings the Court ordered compliance with pending proceduralmatters. On December 22, 2022 the court ordered the commencement of the evidentiary stage. After reviewing the evidence offered by the parties for quitesome time, on March 28, 2023 the Court has ordered the parties to start producing their evidence. Currently, the parties are still producing the evidence offered.Based on information currently available and the current stage of the litigation, we believe that the chances of success of the claim against us are remote, andthus have not recorded any provision in the consolidated balance sheets as of December 31, 2024. Antitrust Proceedings CNDC Market Investigation (C. 1476). In 2013, the CNDC initiated administrative investigations related to the price of cement. To this end, theCNDC requested information from all cement companies involved in the 1999 investigation. In June 2014, the CNDC removed Loma Negra as a party to theinvestigative proceeding and confirmed that it is a market investigation where the cement companies do not have access to the file. As of the date of this annualreport, the case is still under analysis by the CNDC. Thus, based on information currently available and the current stage of the investigation, we are unable toreasonably estimate a possible loss or range of possible losses, if any, with regard to any potential claims and thus have not recorded any provision in theconsolidated balance sheet as of December 31, 2024. CNDC Market Investigation (C. 1491). In 2014, the CNDC initiated a market investigation that involved all construction materials companies.However, no particular company has been charged or is subject to investigation for anti-competitive behavior. In March and June 2014, Loma Negra submittedall the information requested by the Antitrust Commission. As of the date of this annual report, the case is still under analysis by the CNDC. Thus, based oninformation currently available and the current stage of the investigation, we are unable to reasonably estimate a possible loss or range of possible losses, if any,with regard to any potential claims and thus have not recorded any estimated liability in the consolidated balance sheet as of December 31, 2024. CNDC Market Investigation - Competitive Conditions in Cement Market (IM 6). On August 10, 2017, we were notified of a new administrativeinvestigation initiated by the CNDC regarding competitive conditions in the cement market in Argentina. None of the cement companies has been accused or issubject to investigation for anticompetitive practices under this proceeding. On April 26, 2018 the CNDC notified that the purpose of the investigation was toanalyze the market conditions of the cement industry in order to make recommendations. The CNDC has requested us to file several information anddocumentation related to products that we commercialized: the last request for information received by us was February 7, 2021. We filed the requestedinformation on February 23, 2021. On April 27, 2022 the CNDC issued Disposition DISFC-2022-36-APN-CNDC#MDP, by which it decided to close theinvestigation with recommendations to the Chamber of Producers of Portland Cement (AFCP for its acronym in Spanish). No recommendation was issuedregarding the cement companies. CNDC Investigation - Abuse of Dominant Position (C. 1794). In July 2022, the Antitrust Commission initiated an investigation into the companyfor alleged abuse of dominant position and price discrimination in Portland cement prices and asked Loma Negra to give explanations. On August 26, 2022, wefiled explanations and denied all claims. On November 4, 2022, the Antitrust Commission decided to continue the investigation and requested information fromus and third parties. On October 25, 2024, we received the Resolution from the Secretary of Commerce, which 114
Page 124
Table of Contents concluded the investigation based on the CNDC's opinion that no anticompetitive practices had occurred. This decision is not subject to appeal, and the case hasbeen definitively closed. Securities Complaints Commenced Against Loma Negra under US Jurisdiction In 2018, two investors who purportedly purchased our ADSs pursuant and/or traceable to our IPO, commenced two different putative class actionsbefore US courts on behalf of all persons and/or entities who purchased or otherwise acquired our ADSs pursuant and/or traceable to our prospectus andregistration statement issued in connection with the IPO, and, in the case of the Federal Class Action (defined below), on behalf of all persons and/or entitieswho purchased our ADSs on the open market between November 2, 2017 and May 23, 2018, inclusive. Loma Negra, its directors and some members of itssenior management at the time of the IPO and Loma Negra Holding GmbH (now Intercement Trading e Inversiones, S.A.) were named as defendants in bothactions. Federal Class Action On December 5, 2018, plaintiff, Eugenio Carmona filed a complaint in the United States District Court for the Southern District of New York,pursuant to Sections 11, 12(a)(2) and 15 of the Securities Act of 1933.The plaintiff alleged that our offering materials failed to disclose material facts and risksconcerning our prospects for future growth and that the price of our ADSs was artificially inflated. We moved to dismiss the action and on April 27, 2020, theUnited States District Court for the Southern District of New York issued an opinion granting defendants’ motion to dismiss. On July 17, 2020, the plaintiffvoluntarily dismissed the appeal filed against the Federal Court’s opinion. Therefore, the favorable opinion for us and the other defendants is final and theFederal Class Action is over. State Class Action On June 21, 2018, plaintiff Dan Kohl filed a complaint in the Supreme Court of the State of New York, New York County, pursuant to Sections 11and 15 of the Securities Act of 1933. The complaint also asserts claims against the underwriters of our IPO. The plaintiff alleges that our offering materialsfailed to disclose material facts and risks concerning our prospects for future growth and our business. As a result of such alleged omissions, the plaintiffasserted that the price of our ADSs was artificially inflated. On March 13, 2019, we filed a motion to dismiss the complaint. On October 22, 2020, the StateCourt issued its ruling on the motion to dismiss dismissing part of the claims while allowing the rest of the claims to proceed. On June 1, 2021, the FirstDepartment modified the Supreme Court’s decision on our motion to dismiss and further narrowed the grounds upon which the case can proceed. On December 2, 2021, the State Court entered an order certifying the case as a class action and denying our motion for summary judgment. Weappealed these rulings, but they were affirmed by the First Department on November 17, 2022.On October 11, 2023, we entered into a proposed settlement agreement (the "Agreement") with the lead plaintiff for US$24.6 million. Asignificant portion of the payment obligations arising from the Agreement were covered by our D&O insurance policies. The New York State Court grantedpreliminary approval on November 30, 2023, and final approval followed on April 10, 2024. The New York State Court rendered a final judgment pursuant tothe settlement on March 3, 2025. The appeal deadline expired on April 2, 2025, with no appeals filed. As a result, the settlement is now final, and the releasesare effective. The Agreement did not contain any admission or acknowledgment of liability for wrongful conduct by Loma Negra or the other defendants in theclass action, and provided for release of all claims. Dividends and Dividend Policy Under the Argentine General Companies Law, the declaration and payment of dividends is determined by the shareholders at the shareholders’meeting. The approval of dividends requires the affirmative vote of a majority of the shares entitled to vote at the meeting. We have a single class of ordinaryshares entitled to the same voting rights and amount of dividends per share. Dividends, if any, on our outstanding ordinary shares will be proposed by our board of directors and subject to the approval of our shareholders.Even if our shareholders decide to distribute dividends, the form, frequency and amount of such dividends will depend upon our future operations and earnings,investment plans, capital requirements and surplus, general financial condition, contractual restrictions and other factors our board of directors and shareholdersmay deem relevant. 115
Page 125
Table of Contents In addition, the distribution of dividends may be limited by Argentine law, which permits the distribution of dividends only out of realized and netearnings (ganancias líquidas y realizadas) as set forth in our annual standalone financial statements presented in pesos and approved by our shareholders, orconsolidated special interim balance sheet, in case of anticipated dividends. Under the Argentine General Companies Law, our bylaws and our Dividend Policy, we are required to allocate to our legal reserve 5% of ourannual net earnings, plus or minus the results of prior years, until our legal reserve equals 20% of our then outstanding aggregate share capital. The legalreserve is not available for distribution to the shareholders. References to our bylaws are to our bylaws as adopted by our Shareholders Meeting held on April16, 2020 and the amendment of Section Fifth of our by-laws as a consequence of the Voluntary Capital Reduction decided in the Shareholders Meeting held onApril 25, 2023. Additionally, our annual net profit must be allocated in the following order: • to comply with the legal reserve requirement; • to the establishment of voluntary reserves; • to pay the accrued fees of the members of our board of directors and supervisory committee; • to pay dividends on preferred shares (if at any time issued and existing); • to the distribution of dividends; and • any remaining balance to undistributed cumulated earnings or as otherwise determined by our shareholders at the annual shareholders’meeting. According to the rules issued by the CNV, cash dividends must be paid to shareholders within 30 days of the resolution approving theirdistribution. Amounts Available for Distribution Our board of directors will propose how to allocate our net profit for the preceding fiscal year. The allocation and declaration of annual dividendsrequires the approval of a majority of our shareholders. Dividends in cash have to be paid within 30 days as from the date of the shareholders’ meeting thatapproved such distribution of dividends; while dividends payable in shares, such shares have to be delivered to the shareholders within three months as from thedate of the shareholders’ meeting that approves such dividend. The time limit after which the dividend entitlement lapses is 5 years from the date on which thedividend is payable in favor of the company. According to our Dividend Policy the recommendation of our board of directors for the payment of dividends and its amount will depend on anumber of factors, including, but not limited to, our cash flow, financial condition (including capital position), investment plans, prospects, legal requirements,economic climate and such other factors as we may deem relevant at the time. The amount of future dividends or interest attributable to shareholders’ equity wemay pay is subject to Argentine corporate law and will be determined by our shareholders at the shareholders’ meetings as described above. Our bylaws and Dividend Policy do not provide for specific amounts to be distributed, but refer to the distribution of the remainder of net profitafter legal and statutory reserves are established. Reserve Accounts Reserve accounts are comprised of the legal reserve, environmental reserve and optional reserve for future dividends, as determined at theshareholders’ meeting. Legal reserve: in accordance with the Argentine General Companies Law and our bylaws, we are required to allocate to our legal reserve 5% ofour annual net earnings, plus or minus the results of prior years, until our legal reserve equals 20% of our then outstanding aggregate share capital. The legalreserve is not available for distribution to the shareholders. If this legal reserve is reduced for any reason, no dividends can be distributed until such reserve isreinstated. Environmental reserve: we may allocate a reserve for environmental investments. Optional reserve for future dividends: we may reserve a portion of our net profit for future dividends distributions. 116
Page 126
Table of Contents Based on current regulations in Argentina, the shareholders’ meeting must allocate 100% of our net profit. The table below sets forth our capital reserves as of the dates indicated: As of December 31, 2024 2023 2022 (in millions of Ps.) Legal reserve 19,161.7 19,161.7 19,161.7 Environmental reserve 149.6 149.6 149.6 Optional reserve for future dividends 355,816.3 340,843.1 495,207.6 Total reserves 375,127.6 360,154.4 514,518.9 Payment of Dividends Form of Payment In general, Argentine foreign exchange regulations may grant access to the FX Market for the purchase of foreign currency to pay dividendsabroad to foreign shareholders or to an ADS depositary for the benefit of the foreign holders of ADSs if certain conditions are met. Cases not falling under theexhaustive list provided by Argentine foreign exchange regulations will require prior approval of the BCRA to access the FX Market, which is seldom grantedand acts as a de facto prohibition. Additionally, the “External Credits and Debts Survey” established by Communication “A” 6401, as amended, must have beencomplied with. Furthermore, the total amount to be paid to non-resident shareholders through the FX Market shall not exceed the corresponding amountdenominated in Pesos that was determined by the shareholders’ meeting. Notwithstanding the foregoing, Argentine companies shall have access to the foreignexchange market to purchase and transfer foreign currency abroad for the payment of profits and dividends to non-resident shareholders pursuant to certainprovisions set forth in foreign exchange regulations. These distributions must correspond to distributable profits derived from realized earnings arising fromregular and audited annual financial statements for fiscal years beginning on or after January 1, 2025. See “Item 10. Additional Information—D. ExchangeControls—Foreign indebtedness information regime”. The ordinary shares underlying the ADSs are held in Argentina by Caja de Valores, acting as the custodian agent for the ADS depositary. The ADSdepositary is the registered owner on record of our ordinary shares represented by ADSs and acts as the registrar of our ADSs. We inform the BCRA the amountof our ordinary shares held by foreign shareholders and the shares underlying the ADSs, and, therefore, should have access to the FX Market (single and freeforeign exchange market) to pay dividends with respect to our ordinary shares and ordinary shares represented by ADSs, subject to certain structural restrictionsas described further in “Item 3. Key Information—Risk Factors—Restrictions on transfers of foreign exchange and the repatriation of capital from Argentinamay impair your ability to receive dividends and distributions on, and the proceeds of any sale of, the shares underlying the ADSs.” Pursuant to the depositagreement, holders of ADSs will be entitled to receive dividends, if any, declared with respect to the underlying ordinary shares represented by such ADSs tothe same extent as the holders of the ordinary shares. Payments of cash dividends and distributions, if any, will be made in pesos, although we reserve the right to pay in other currency or in kind to theextent permitted by applicable law. The ADS depositary will convert such dividends received in pesos into U.S. dollars and pay such amount to holders ofADSs, net of any dividend distribution fees, ADS depositary’s fees and expenses, currency conversion expenses and taxes or governmental charges, if any. Inthe event that the ADS depositary is unable to convert immediately the amount in pesos received as cash dividends into U.S. dollars, the amount of U.S. dollarspayable to holders of ADSs may be adversely affected by depreciation of the peso. History of Payment of Dividends The annual shareholders’ meeting held on March 23, 2017, approved the distribution of cash dividends in an aggregate amount of Ps. 444.7million (nominal value) and the increase in the reserve for future dividends of Ps. 15.5 million (nominal value) with respect to our results for the year endedDecember 31, 2016. On May 17, 2017, our board of directors approved the payment of this distribution of cash dividends. 117
Page 127
Table of Contents The annual shareholders’ meeting held on April 25, 2018, approved the allocation of the earnings for the year ended December 31, 2017 for theamount of Ps. 1,590.2 million (nominal value) in the facultative reserve considering the current investment plan in property, plant and equipment. The annual shareholders’ meeting held on April 25, 2019, approved the allocation of the retained earnings for the year ended December 31, 2018for the amount of Ps. 5,166.2 million (nominal value) in the facultative reserve considering the current investment plan in property, plant and equipment. The annual shareholders’ meeting held on April 16, 2020, approved the allocation of the retained earnings for the year ended December 31, 2019for the amount of Ps. 127.7 million (nominal value) in the legal reserve and Ps. 3,711.5 million (nominal value) in the facultative reserve considering thecurrent investment plan in property, plant and equipment. The ordinary shareholders’ meeting held on September 30, 2020, approved to allocate a part of the Reserve for Future Dividends to distributedividends in the amount of Ps. 2,400 million (nominal value), equivalent to a dividend of Ps. 4.03 per share. The dividends payment was executed duringOctober, 2020. The annual shareholders’ meeting held on April 20, 2021, approved (i) to modify the allocation of the Optional Reserve and to allocate such sumto the payment of future dividends and, consequently, change its name to “Optional Reserve for Future Dividends”; and (ii) to allocate the sum of Ps. 11,351million (nominal value) to the Optional Reserve for Future Dividends. Also, it was approved to delegate to the board of directors the power to totally orpartially disaffect and distribute in cash, one or more times, the amount in constant currency of the Optional Reserve for Future Dividends depending on theevolution of the business and the regulatory restrictions and limitations until the next annual shareholders meeting that will consider the financial statementscorresponding to the year ending December 31, 2021. On April 14, 2022 the board of directors of our company approved to allocate a part of the Reserve for Future Dividends to distribute dividends inthe amount of Ps. 5,150 million, equivalent to a dividend of Ps. 8.79 per outstanding share. The dividends payment was executed as of April 2022. The annual shareholders’ meeting held on April 27, 2022, approved (i) to allocate the sum of Ps. 6,586 million (adjusted per inflation as ofDecember 31, 2021) to the Optional Reserve for Future Dividends; and (ii) to delegate to the board of directors the power to totally or partially disaffect anddistribute in cash, one or more times, the amount in constant currency of the Optional Reserve for Future Dividends depending on the evolution of the businessand the regulatory restrictions and limitations until the next annual shareholders meeting that will consider the financial statements corresponding to the yearending December 31, 2022. On July 1, 2022 the board of directors of our company approved to allocate a part of the Reserve for Future Dividends to distribute dividends inthe amount of Ps. 10,300 million, equivalent to a dividend of Ps. 17.59 per outstanding share. The dividends payment was executed in July 2022. On December 27, 2022 the board of directors of our company approved to allocate a part of the Reserve for Future Dividends to distributedividends in the amount of Ps. 3,500 million, equivalent to a dividend of Ps. 5.99 per outstanding share. The dividends payment was executed as of January2023. The annual shareholders’ meeting held on April 25, 2023, approved (i) to allocate the sum of Ps. 1,939 million (adjusted per inflation as ofDecember 31, 2022) to the Optional Reserve for Future Dividends; and (ii) to delegate to the board of directors the power to totally or partially disaffect anddistribute in cash and/or kind, one or more times, the amount in constant currency of the Optional Reserve for Future Dividends depending on the evolution ofthe business and the regulatory restrictions and limitations until the next annual shareholders meeting that will consider the financial statements correspondingto the year ending December 31, 2023. On May 2, 2023 the board of directors of our company approved to allocate a part of the Reserve for Future Dividends to distribute dividends inkind in Argentine Republic Treasury Bills in the amount of Ps. 22,200 million (nominal value), equivalent to a dividend of 43.86 Argentine Republic TreasuryBills per outstanding share. The dividends payment was executed in May 2023. On June 23, 2023 the board of directors of our company approved to allocate a part of the Reserve for Future Dividends to distribute dividends inthe amount of Ps. 13,700 million, equivalent to a dividend of Ps. 23.48 per outstanding share. The dividends payment was executed in July 2023. 118
Page 128
Table of Contents The annual shareholders’ meeting held on April 23, 2025, approved (i) to allocate the sum of Ps. 153,810 million (in December 31, 2024 currency)to the Optional Reserve for Future Dividends; and (ii) to delegate to the Board of Directors the power to totally or partially release and distribute in cash and/orin kind, one or more payments, the amount in constant currency of the Optional Reserve for Future Dividends depending on the evolution of the business andthe regulatory restrictions and limitations through the next annual shareholders meeting that will consider the financial statements corresponding to the yearending December 31, 2025. Contractual Limitations on Dividend Payments As of the date of this annual report, none of our outstanding indebtedness contains contractual limitations on dividend payments. The payment of cash dividends may be subject to additional tax considerations. For further information on the tax implications of dividendpayments see “Item 10.E Additional Information—Taxation—Material Argentine Tax Considerations—Taxation on Dividends”. B. Significant Changes Except as identified in this annual report, no undisclosed significant changes have occurred since the date of the consolidated financial statements. ITEM 9. THE OFFER AND LISTING A. Offer and Listing Details Our ordinary shares trade on the BYMA under the symbol “LOMA” and on the NYSE under the symbol “LOMA” in the form of ADSs issued byJPMorgan Chase Bank, N.A., as depositary. Each ADS represents five ordinary shares. B. Plan of Distribution Not applicable. C. Markets On October 31, 2017, we completed our initial public offering and on November 1, 2017, our ADSs representing ordinary shares began to trade onthe NYSE under the symbol "LOMA". Our ordinary shares are currently traded on BYMA (since November 2017) under the symbol “LOMA”. D. Selling Shareholders Not applicable. E. Dilution Not applicable. F. Expenses of the Issue Not applicable. 119
Page 129
Table of Contents ITEM 10. ADDITIONAL INFORMATION A. Share Capital Not applicable. B. Memorandum and Articles of Association Description of Capital Stock Our bylaws, approved by our shareholders at our general shareholders’ meeting held on April 16, 2020, and the amendment of Section Fifth ofour by-laws as a consequence of the Voluntary Capital Reduction decided in the Shareholders Meeting held on April 25, 2023, are filed as Exhibit 1.1 to thisannual report. The information otherwise contemplated by this Item is included in Exhibit 2.2 to this annual report, which is hereby incorporated by reference.This summary does not purport to be complete and is qualified by reference to our by-laws, Argentine corporate law, the rules and regulations of the CNV andthe listing rules of BYMA. For more complete information, you should read our bylaws. For information on how to obtain a copy of our bylaws, please read“Documents on Display”. General We are a corporation organized as a Sociedad Anónima under the laws of Argentina, incorporated on May 10, 1926 and registered with the PublicRegistry of Commerce of the Province of Buenos Aires (Azul) on August 5, 1926. The resolution of the board of directors dated July 4, 2018 approved thechange of our principal executive offices to Boulevard Cecilia Grierson 355, 4 floor, City of Buenos Aires. This resolution has been registered before thePublic Registry of the City of Buenos Aires on October 1, 2018 under No. 18553, Book No. 91, Volume – of corporations. Our share capital as of December 31, 2024 consisted of Ps. 58,348,315.10, represented by 583,483,151 ordinary, book entry shares, with a parvalue of Ps. 0.10 per share and each entitled to one vote. All outstanding shares are fully paid as of the date of this annual report. The rights of holders of our stock may be modified through a resolution of our extraordinary shareholders’ meeting. Bylaws Corporate Purpose According to our bylaws, we have a broad corporate purpose that includes, among others, to participate in industrial activities, such as theproduction, commercialization, multiplication, licensing, purchase, sale, importation, exportation and distribution of mining products, as well as to engage inany activity related to mining; to invest in national or foreign companies, private or partially state-owned; to subscribe, acquire or transfer shares, interest orsecurities, to form subsidiaries; to provide guarantees to third parties; purchase, sale or lease real estate and personal property; to purchase, sell, register andmake use of intellectual property; and to allocate up to 10% of its capital, reserves and profits to social and cultural works and charity. Shareholders’ Meetings Shareholders’ meetings may be ordinary or extraordinary. We are required to convene and hold an ordinary meeting of shareholders within fourmonths of the close of each fiscal year to consider the matters specified in the first two paragraphs of Section 234 of the Argentine General Companies Law,such as the approval of our consolidated financial statements, allocation of net profit for such fiscal year, approval of the reports of the board of directors andsupervisory committee and election and remuneration of directors and members of the supervisory committee. Other matters which may be considered at anordinary meeting convened and held at any time include the responsibility of directors and members of the supervisory committee, and capital increases withoutlimit, according to our bylaws. In addition, under the provisions of section 71 of the LMC, and because we are a company authorized to publicly offer our ordinary shares, theordinary shareholders’ meeting is to undertake (i) the transfer or encumbrance of all or a substantial part of our assets, other than in the ordinary course ofbusiness; and (ii) the execution of an administration or management agreement as it relates to our business and/or assets. The same applies to the approval ofany other th 120
Page 130
Table of Contents agreement pursuant to which the assets or services received by us are paid for, totally or partially, with a percentage of our income, results or profits, if suchamount is substantial as it relates to our business or assets. Extraordinary shareholders’ meetings may be convened at any time to consider matters beyond the authority of an ordinary meeting, includingamendment of the bylaws; reduction and reimbursement of capital; redemption, reimbursement and amortization of shares; merger, transformation anddissolution of the company; appointment, removal and remuneration of liquidators; spin-off; examination of accounts and any other matters related tomanagement during the liquidation of the corporation, which may require a final approving resolution; limitation or suspension of preemptive rights pursuant toSection 197 of the Argentine General Companies Law; reduction of the term for the exercise of preemptive rights for the subscription of new ordinary sharespursuant to Section 194 of the Argentine General Companies Law; issue of debentures and their conversion into shares; and issue of bonds, except for theissuance of negotiable obligations under Argentine law, which may be approved by a resolution of an ordinary shareholders meeting. The Argentine General Companies Law provides that shareholders’ meetings may be called by our board of directors or by our supervisorycommittee or at the request of the holders of shares representing no less than 5% of the ordinary shares. Any meetings called at the request of shareholders mustbe held within a maximum of 40 days after the request is made. Any shareholder may appoint any person as its duly authorized representative at a shareholders’meeting, by granting a proxy. Notice of shareholders’ meetings must be published during five days in the Official Gazzette, in an Argentine newspaper of wide circulation and inthe publications of Argentine exchanges or securities markets in which our ordinary shares are traded, at least 20 days before but no later than 45 days from thedate on which the meeting is to be held. Such notice must include information regarding the type of meeting to be held, the date, time and place of such meetingand the agenda. If a quorum is not achieved at such first call for the meeting, a notice for a second call for the meeting, which must be held within 30 days ofthe date on which the first meeting was called, must be published for three days, at least eight days before the date of the second call for the meeting. Theabove-described notices of shareholders’ meetings may be effected simultaneously for the second call for the meeting to be held on the same day as the firstcall, except in the case of extraordinary meetings. Shareholders’ meetings may be validly held without notice if all shares of our outstanding share capital arepresent and resolutions are adopted by unanimous vote of such shares. Under Argentine corporate law and our bylaws, quorum for ordinary meetings of shareholders on first call is a majority of the shares entitled tovote, and action may be taken by the affirmative vote of an absolute majority of the shares present that are entitled to vote on such action. If a quorum is notavailable at the first call for the meeting, a second call for the meeting may be held at which action may be taken by the holders of an absolute majority of theshares present, regardless of the number of such shares. The quorum for an extraordinary shareholders’ meeting on first call is 60% of the shares entitled tovote, and if such quorum is not available, an extraordinary meeting following a second call may be held with the presence of 30% of shares entitled to vote. However, pursuant to Section 244 of the Argentine General Companies Law, all shareholders’ meetings, whether convened on a first or secondquorum call, require the affirmative vote of the majority of shares with right to vote in order to approve the following decisions: voluntary winding-up of thecompany, transfer of the domicile of the company outside of Argentina, fundamental change to the purpose of the company, total or partial mandatoryrepayment by the shareholders of the paid-in capital; and a merger or a spin-off, when our company will not be the surviving company. In the aforementionedcases, multiple voting rights granted by a certain class of shares shall not be considered. Also, under Section 284 of the Argentine General Companies Law,multiple voting rights will not be applicable to the election of syndics or members of the supervisory committee; provided that, the Argentine GeneralCompanies Law allows for the election of up to one third of vacant supervisory committee members positions through the cumulative voting system in termssimilar to those described in the election of the members of the board of directors. End of Fiscal Year Our fiscal year ends on December 31 of each year. Jurisdiction and Arbitration Pursuant to Section 46 of the LMC, companies whose shares are listed on any authorized market (including the BYMA), are subject to thejurisdiction of the arbitration court of such authorized market (in this case, the Tribunal de Arbitraje General de la Bolsa de Comercio de Buenos Aires, or anysuccessor thereof) for all matters concerning such companies’ relationship with shareholders and investors, without prejudice to the right of shareholders andinvestors to 121
Page 131
Table of Contents submit their claims (or challenge any arbitral award, as provided by Sections 758 and 760 of the Argentine Code of Civil and Commercial Procedure) to thecompetent courts of Argentina. In case that the applicable laws provide for the accumulation of claims related to the same subject matter, such accumulationwill be subject to the jurisdiction of the judicial courts. Shareholders’ Agreements To our knowledge, as of the date of this annual report, there are no shareholders’ arrangements or agreements the implementation or performanceof which could, at a later date, result in a change in the control of us in favor of a third person other than the current controlling shareholder. C. Material Contracts We have not been party to any material contracts within the two years prior to the date of this annual report, other than contracts entered into in theordinary course of business. D. Exchange Controls Due to the foreign exchange crisis after the primary elections in August 2019 and the uncertainties on the presidential elections in October 2019and the measures to be adopted by a new administration, since September 1, 2019, the Argentine Central Bank reinstated rigid restrictions and foreign exchangecontrols, which have been extended without time limitation by Decree No. 91/2019 issued on December 28, 2019, by the Argentine Executive Branch, andCommunication “A” 6862 issued by the Argentine Central Bank on January 15, 2020. Pursuant to these measures, as further amended and complemented, andother additional measures adopted by the Argentine Central Bank, among other things: (i) Prior authorization of the Argentine Central Bank is required for the access to the FX Market for the purchase of foreign currency: • For portfolio investment purposes by legal entities, local governments, funds and trusts; • By non-Argentine residents, except for certain exemptions; • For payment of dividends and earnings, except, among other requirements, if (i) the total amount of said payment of profits and dividends asfrom January 17, 2020 (including the amount of the payment being made at the time of the access) does not exceed 30% of the value of newcapital contributions of foreign direct investments made to local companies; (ii) the funds are transferred to Argentina and sold for pesosthrough the foreign exchange market as from such date; and (iii) regarding resident shareholders, the total amount to be paid through the FXMarket does not exceed the corresponding amount denominated in Pesos that was determined by the shareholders' meetings. • For the pre-payment of principal and interest on foreign financial indebtedness with an anticipation of more than three business days inadvance to the scheduled maturity dates, unless certain conditions are met; • For the pre-payment of indebtedness for the import of goods and services, except for certain exemptions; • Until December 12, 2024, for the payment of principal under foreign financial indebtedness with related parties, except for certainexemptions. (ii) The proceeds of the disbursements of foreign financial loans incurred since September 1, 2019 must be transferred into Argentina and convertedinto pesos through the FX Market in order for the Argentine resident debtor to have access to the FX Market for the payment of principal andinterests under such foreign financial loan on their scheduled maturity. (iii) It is prohibited to access the FX market for the purchase of foreign currency for the payment of local debts and other obligations incurred inforeign currency between Argentine residents originated as of September 1st, 2019, except, among others, in the case of obligations instrumentedby means of public registries or deeds dated as of August 30, 2019. 122
Page 132
Table of Contents (iv) The proceeds from the collections of foreign currency by Argentine residents abroad for the export of the following goods since September 2nd,2019 are subject to mandatory transfer into Argentina and conversion into pesos through the FX Market, within the terms described in each case,computed from the shipment date: • 30 consecutive days for crops, soybean oil, hydrocarbons and derivatives; • 60 consecutive days for exports between related parties not including the goods described above and for metal ores and precious metals; • 180 consecutive days for all other goods; and • 365 consecutive days for small exports under the EXPORTA SIMPLE program for medium and small companies with annual FOB exports ofless than US$ 600,000 and individual exports of less than US$ 15,000 each. Regardless of the applicable maximum terms described above, upon collection of the export receivables, the proceeds thereof are subject to themandatory repatriation within the five consecutive days computed from the date of payment or collection. For exports of certain services and all goods included in the Nomenclatura Común del MERCOSUR, the above will be considered completedwhen the exporter has entered and settled in the exchange market an amount of no less than 80% of the invoiced value and has completedoperations of purchase and sale of securities for the unsettled portion, in which securities are acquired with settlement in foreign currency and soldwith settlement in local currency in Argentina. (v) The proceeds from the collection of foreign currency by Argentine residents out of Argentina for the export of services are subject to mandatoryrepatriation within 20 consecutive days computed from the date they are received. As a general rule, Argentine residents may access the FX Market for the payment of imports of goods. Different requirements apply for goodswith customs entry registration and goods with pending customs entry registration. (vi) Pursuant to Communication “A” 7001, dated April 30, 2020, and its amendment, in order to gain access to the FX Market for making any kind ofpayments, and in addition to applicable requirements, the Argentine Central Bank requires an affidavit from the requestor, (i) stating that withinthe immediately proceeding 90 consecutive days it has not (a) sold in Argentina securities settled against foreign currency; (b) transferredsecurities to custody accounts out of Argentina within the immediately preceding 90 consecutive days; (c) acquired in the country securities issuedby non-residents with settlement in pesos; (d) acquired Argentine certificates of deposit representing foreign shares; (e) acquired securitiesrepresenting private debt issued in foreign jurisdictions; and (f) delivered funds in local currency or other local assets (except funds in foreigncurrency deposited in local financial institutions) to any human or legal person, resident or non-resident, related or not, receiving as prior orsubsequent consideration, directly or indirectly, by itself or through a related, controlled or controlling entity, foreign assets, crypto-assets orsecurities deposited abroad; and (ii) committing within the immediately following 90 consecutive days not to perform the operations described in(a) yo (f) above. In accordance with Communication “A” 8226, individuals are exempted from the requirements set forth in points 3.16.3.1 and3.16.3.2 of the Foreign Exchange Regulations described in this section. (vii) Pursuant to sections 3.16.3.3 and 3.16.3.4. of the Consolidated Text of Foreign Exchange of the BCRA, additionally to the affidavit of point (vi)above, in order to gain access to the FX Market, requestors must inform the details of the individuals or legal entities that exercise a relationshipof direct control over the requestor and other legal entities conforming the same economic group (Communication "A" 7766, item 2). Also,requestors must indicate whether they have delivered in the country funds in local currency or other liquid local assets – except funds in foreigncurrency deposited in local financial entities –, on the 90 calendar days before they request access to the foreign exchange market, to anyindividual or legal entities that exercises a relationship of direct control over it, or to other companies with which it is part of the same economicgroup, except those directly associated with operations between residents for the acquisition of goods and/or services. Otherwise, they mustpresent sworn statements from each individual and/or legal person entity who exercises “direct control” over the exchange market or othercompanies with which it is part of the same economic group, to which it has delivered local currency or local assets, indicating that they 123
Page 133
Table of Contents have not carried out (nor will they carry out) any of the excluding transactions (a) to (f) of point (vi) above, for 180 consequently days before and180 consequently days after. (viii) Communication “A” 7030 of the Argentine Central Bank, dated May 28, 2020, as amended, requires that, for purposes of accessing the FXMarket for the outflow of funds, requestor will be required to file an affidavit (i) stating, that as of such date, all of such requestor’s holdings offoreign currency in Argentina are deposited with Argentine financial institutions and that it did not hold, at the beginning of the day on which itrequests market access, Argentine certificates of deposit representing foreign shares and/or available liquid assets that together have a value at thebeginning of the day on which it requests market access of more than the equivalent of US$100,000 (one hundred thousand U.S. dollars); and (ii)committing to transfer into Argentina and settle for Argentine pesos any foreign currency payments received outside of Argentina from thecollection of loans granted to third parties after May 28, 2020, time deposits made after May 28, 2020, or the sale of any asset when the asset wasacquired. (ix) According to section 3.5. of the Consolidated Text of Foreign Exchange of the BCRA, Argentine residents may access the FX Market for thepayment of principal or interest under financial debt with third parties, provided that, amongst others, the following requirements are met: (i) thefunds disbursed as of September 1, 2019 had been entered and settled against pesos in the FX Market; (ii) the operation was declared, ifapplicable, in the last due presentation of the “Survey of external assets and liabilities” and (iii) access to the FX Market occurs no more than 3business days prior to the maturity date of the principal or interest due. Also, the Argentine Central Bank authorized the prepayment of principaland interest under foreign financial indebtedness against the settlement of funds received in concept of a new financial indebtedness with foreignparties, or against a canje operation, subject to the compliance with some additional requirements. (x) The access to the FX Market for the purchase of foreign currency for any of the payments described above is subject to compliance with theforeign indebtedness information regime before the Argentine Central Bank. Law No. 19,359 (revised text pursuant to Decree No. 480/95 and complementary regulations) establishes penalties for the infringement of anyforeign exchange regulations. Penalties include fines of up to a tenfold increase in the amount of the infringing transaction, temporary suspensions,disqualification for up to ten years preventing the infringing party from acting as importer, exporter and/or as foreign exchange institution, or even prison inevent of recidivism. Additionally, on April 15, 2025, the Argentine Central Bank announced it will issue a new series of Bonds for the Reconstruction of a FreeArgentina (BOPREAL for its acronym in Spanish) in order to order payments of inherited stocks of commercial debts prior to December 12, 2023, dividendsand commercial and financial debt services retained with related entities. For additional information regarding all current foreign exchange restrictions and exchange control regulations in Argentina, investors shouldconsult their legal advisors and read the applicable rules mentioned herein, as well as any amendments and complementary regulations, which are available atthe Argentine Central Bank’s website: www.bcra.gob.ar. E. Taxation Taxation The following discussion contains a description of the principal Argentine and United States federal income tax consequences of the acquisition,ownership and disposition of our ordinary shares or ADSs, but it does not purport to be a comprehensive description of all the tax considerations that may berelevant to a decision to purchase our ordinary shares or ADSs and is not applicable to all categories of investors, some of which may be subject to special rules,and does not specifically address all of the Argentine and Unites States federal income tax considerations applicable to any particular holder. This summary isbased upon the tax laws of Argentina and the regulations thereunder and the tax laws of United States and the regulations thereunder as in effect on the date ofthis annual report, which are subject to change, possibly with retroactive effect, and to differing interpretations. Each prospective purchaser is urged to consultits own tax adviser about the particular Argentine and United States federal income tax consequences to it of an investment in our ordinary shares or ADSs. Thisdiscussion is also based upon the representations of the depositary and on the assumption that each obligation in the deposit agreement among us, JPMorganChase Bank, N.A, as depositary and the registered holders and beneficial owners of the ADSs, and any related documents, will be performed in accordance withits terms. Material Argentine Tax Considerations The following opinion of material Argentine tax matters is based upon the tax laws of Argentina and regulations thereunder as of the date of thisannual report, and is subject to any subsequent change in Argentine laws and st 124
Page 134
Table of Contents regulations which may come into effect after such date. This section is the opinion of the law firm Marval O’Farrell Mairal, insofar as it relates to matters ofArgentine tax law, of the material Argentine tax considerations relating to the purchase, ownership and disposition of our ordinary shares or ADSs. This opiniondoes not purport to be a comprehensive description of all of the tax considerations that may be relevant to a holder of such securities. No assurance can be giventhat the courts or tax authorities responsible for the administration of the laws and regulations described in this annual report will agree with this interpretation.Holders should carefully read “Key Information—Risk Factors–Risks Relating to the Offering, Our Ordinary Shares and the ADSs– Interpretation of Argentinetax laws may adversely affect the tax treatment of our ordinary shares and the ADSs”. Holders are encouraged to consult their tax advisers regarding the taxtreatment of our ordinary shares and ADSs as it relates to their particular situation. Laws No. 27,430 and No. 27,541, enacted by the Argentine Congress on December 27, 2017 and December 21, 2019 respectively, made relevantamendments to the Argentine federal tax regime. Such amendments reached, among other laws, the Argentine Income Tax Law (the “ITL”) and the PersonalAssets Tax Law. As a result, when we mention provisions of such laws we are referring to laws in force according to such amendments. In certain cases, we willmention Law No. 27,430 and No. 27,541 with the aim of outlining certain particular aspects of those laws. Taxation on Dividends The following rules apply to dividends paid to Argentine resident individuals and non-Argentine residents individuals or entities: (i) exemptedfrom income tax if they are paid out of income generated during fiscal years beginning before January 1, 2018 except if the Equalization Tax applies (asexplained below); (ii) subject to an income tax withholding rate of 7% if paid out of income generated during fiscal years beginning on or after January 1, 2018. These withholding rates might be lower if the holder of our ordinary shares or ADSs is resident of a country which signed a treaty to avoid doubletaxation with Argentina providing a lower rate and meets all the substantial and formal requirements for such treaty to apply. The Equalization Tax is only applicable to dividend distributions paid out of income generated on fiscal years beginning before January 1, 2018,and to the extent that dividends distributed were greater than the income determined according to the application of the Argentine income tax law, accumulatedat the fiscal year immediately preceding the year in which the distribution is made, referred to as “Taxable Accumulated Income” The Equalization Tax will beimposed as a withholding tax on the shareholder receiving the dividend. Capital Gains Except when a specific exemption applies, gains derived from the transfer of shares, quotas, representative securities and other equity interests,titles, bonds and other securities of Argentine companies are subject to Argentine income tax regardless of the type of beneficiary who obtains the income. Capital gains realized by Argentine corporate entities (in general, entities organized or incorporated under Argentine law, certain traders andintermediaries, local branches of non-Argentine entities, sole proprietorships and individuals carrying on certain commercial activities in Argentina) derivedfrom the sale, exchange or other disposition of shares or representative securities are subject to income tax at a sliding scale from 25% to 35%, depending onthe accumulated net income obtained during the given year. Losses from a previous fiscal year as a result of the disposition of shares can only be applied and compensated against net gains resulting from thesame kind of transaction, and these losses can be carried forward for five fiscal years. Capital gains realized by individuals residents in Argentina from the sale of shares and other securities is subject to income tax at a 15% rate onthe net gain, unless such securities were traded in stock markets and/or have public offering authorization issued by the CNV, in which case an exemptionapplies to the extent certain conditions are met. Such exemption is also applicable for non-Argentine residents subject to certain requirements, as described in the next paragraph. For transactionsnot covered by the exemption (sale of stock not traded in a stock markets and/or with public offering authorization issued by the CNV), the gain derived fromthe disposition of shares and representative securities by non-residents is subject to Argentine income tax at a rate of 15% -except if seller is located in a “non-cooperative” jurisdiction, as explained in next paragraph- either (i) on the net amount resulting from deducting from the 125
Page 135
Table of Contents sale price of the shares, the acquisition cost and the expenses incurred in Argentina necessary for obtaining, maintaining and conserving this asset, as well as thedeductions admitted by the ITL or (ii) on the net presumed income provided by the ITL for this type of transaction (i.e., 90%), which results in an effective rateof 13.5% of the gross price. If the exemption does not apply, the buyer resident in Argentina is responsible for making the withholding. Instead, if the buyer isnot resident in Argentina, the seller is responsible for paying the tax through its legal representative in Argentina, someone appointed for purposes of paying thetax, or through an international wire transfer. The exemption mentioned in the prior paragraph is not applicable if the foreign beneficiary is resident in a “non-cooperative jurisdiction” or theinvested funds come from one of such jurisdictions. Section 19 of the ITL defines them as any jurisdiction or country that: (i) has not signed an informationexchange agreement with Argentina; (ii) has not signed a treaty to avoid double taxation with Argentina; or (iii) has signed either an agreement or conventionbut does not comply with its obligation to share information with Argentina. According to the ITL, the Argentine Executive Branch will be responsible forissuing this “black list” of non-cooperative jurisdictions. Such blacklist was included in Section 24 of the ITL Regulatory Decree No. 862/2019 on December 6,2019. This list was amended by Decree No. 603/2024 on July 11, 2024. If, for this reason the exemption is not applicable, the applicable rate is 35% on the netpresumed income of 90%, thus the effective withholding rate is 31.5%. Before the enactment of the tax reform introduced by Law No. 27,430 in the Argentine Income Tax Law, , the tax treatment applicable to gainsrealized by beneficiaries who were residents and non-residents of Argentina from the sale of ADSs was open to interpretation and it may not have been uniformunder the amended Argentine ITL. Possible variations in the treatment of the ADSs for income tax purposes could affect both residents and non-resident ofArgentina holders of ADSs. As of the date of this annual report, there are no administrative or judicial decisions clarifying the ambiguity of the law regardingthe source of income originated in the sale of ADSs. However, since December 29, 2017, it is clear that the sale of ADSs by non-residents are subject to IncomeTax in Argentina unless the underlying shares are covered by the exemption explained above. Personal Assets Tax Argentine entities, such as us, have to pay the personal assets tax corresponding to resident individuals and non-resident individuals and entitiesfor the holding of our ordinary shares. The applicable tax rate is levied on the proportional net worth value (valor patrimonial proporcional), or the book value,of the shares arising from the last balance sheet of the Argentine entity calculated under Argentine GAAP. The applicable rate was 0.25% until 2018 tax period.Under the Law No. 27,541, the rate for this tax is increased to 0.50%, which is applicable from 2019 tax period onwards. Pursuant to the Personal Assets Tax Law, Argentine companies are entitled to seek reimbursement of such paid tax from the applicable Argentinedomiciled individuals and/or foreign domiciled shareholders. Value Added Tax The sale, exchange or other disposition of our ordinary shares and ADSs, and the distribution of dividends in connection therewith, are not subjectto value added tax. Tax on Bank Accounts Debits and Credits Credits to and debits from bank accounts held at Argentine financial institutions, as well as certain cash payments, are subject to this tax, which isassessed at a general rate of 0.6%. There are also increased rates of 1.2% and reduced rates of 0.075% that may apply in certain cases. Owners of bank accountssubject to the 0.6% or 1.2% rate may consider 33% of the tax paid under this tax as a credit against income tax and/or the special contribution on cooperativecapital. The amount not computed may not be subject, under any circumstances, to compensation with other taxes borne by the taxpayer or be reimbursedor transferred to third parties, and may be transferred, until exhaustion, to other fiscal periods of the aforementioned taxes. The amount computed as a tax creditcannot be deducted for income tax purposes. 126
Page 136
Table of Contents When financial institutions governed by Law No. 21,526 make payments acting in their own name and on their own behalf, the application of thistax is restricted only to certain specific transactions. Such specific transactions include, among others, dividends or profits distributions. Law No. 27,264 increased the creditable portion of the tax to 100% for small-sized companies and to 60% to medium-sized companies registeredas a Small and Medium Enterprises. Turnover Tax In addition, gross turnover tax could be applicable to residents in Argentina on the transfer of shares and on the payment of dividends to the extentsuch activity is conducted on a regular basis within an Argentine province or within the City of Buenos Aires. However, under the Tax Code of the City ofBuenos Aires, any transactions with shares, as well as the payment of dividends are exempt from gross turnover tax. Holders of our ordinary shares or ADSs are encouraged to consult a tax adviser as to the particular Argentine gross turnover tax consequencesderived from holding and disposing of our ordinary shares or ADS. Stamp Taxes Stamp tax is a local tax that is levied based on the formal execution of public or private instruments. Documents subject to stamp tax include, among others, all types of contracts, notarial deeds and promissory notes. Each province and the City ofBuenos Aires have its own stamp tax legislation. Stamp tax rates vary according to the jurisdiction and type of agreement involved. In certain jurisdictions, acts or instruments related to thenegotiation of shares and other securities duly authorized for its public offering by the CNV are exempt from stamp tax. Tax duties exemption on imports under the Mining Investment Regime and the Large Investment Projects Regime The Mining Investment Regime set forth by Law 24,196 (as amended and supplemented) promotes investment in capital goods by exemptions onimport duties and accelerated depreciation on income tax on imports of capital goods. Pursuant to the Large Investment Projects Regime set forth by Resolution No. 256/2000, issued by the former Ministry of Economy (as amended),imports of production lines to enhance the production process and involving the process since the raw material enter the production line and until the finalproduct is produced, are also subject to a promotional regime. Applicants must present a project (which, among other things, must include a commitment toacquire up to 20% of the projects’ value in national goods), and which, upon approval, provides for a two-year term import duties exemption on such goods,subject to verification of the goods use. Other Taxes There are no Argentine federal inheritance or succession taxes applicable to the ownership, transfer or disposition of our ordinary shares, exceptfor the court tax applicable in inheritance or succession processes which, if the proceedings is brought before a court sitting in the City of Buenos Aires, will belevied at 1.5% on the assets of the estate. Such rate will vary in each jurisdiction. The Province of Buenos Aires establishes a tax on free transmission of assets, including inheritance, legacies, donations, etc. Free transmission ofour ordinary shares could be subject to this tax. In the case of litigation regarding the shares before a court of the City of Buenos Aires, a 3% court fee would be charged, calculated on the basisof the claim. Tax Treaties Argentina has signed tax treaties for the avoidance of double taxation with several countries, although there is currently no tax treaty orconvention in effect between Argentina and the United States. 127
Page 137
Table of Contents The above opinion is not intended to be a complete analysis of all tax consequences relating to the ownership or disposition of shares or ADSs.Holders are encouraged to consult their tax advisers concerning the tax consequences arising in each particular case. Material United States Federal Income Tax Considerations The following sets forth the material U.S. federal income tax consequences of the acquisition, ownership and disposition of the ordinary shares orADSs by U.S. Holders (as defined below), but it does not purport to be a comprehensive discussion of all tax considerations that may be relevant to a particularperson’s decision to acquire ordinary shares or the ADSs. This summary does not address the effects of any U.S. federal tax laws other than U.S. federal incometax laws (such as estate and gift tax laws) or any state, local or non-U.S. tax laws. This summary is based upon the U.S. Internal Revenue Code of 1986, asamended (the "Code"), Treasury regulations issued thereunder, and judicial and administrative interpretations thereof, each as in effect on the date hereof, andall of which are subject to change, possibly with retroactive effect. No ruling will be sought from the U.S. Internal Revenue Service (the "IRS"), with respect toany statement or conclusion in this summary, and there can be no assurance that the IRS will not challenge such statement or conclusion in the followingsummary or, if challenged, that a court will uphold such statement or conclusion. This summary does not address all of the U.S. federal income tax consequences that may be relevant to a U.S. Holder in light of such holder’sparticular circumstances, including the impact of the Medicare tax on net investment income, or to U.S. Holders subject to special rules, such as certain banksor financial institutions, certain U.S. expatriates, insurance companies, individual retirement accounts, dealers in securities or currencies, traders in securitiesthat use a mark-to-market method of tax accounting, U.S. Holders whose functional currency is not the U.S. dollar, tax-exempt entities, regulated investmentcompanies, real estate investment trusts, entities or arrangements classified as partnerships or other pass through entities for U.S. federal income tax purposes orholders of equity interests therein, persons liable for alternative minimum tax, U.S. Holders that own, directly, indirectly or constructively, 10% or more of thetotal voting power or value of our stock, U.S. Holders that are resident in or have a permanent establishment in a jurisdiction outside the United States andpersons holding the ordinary shares or ADSs as part of a “straddle”, “hedge”, “conversion transaction”, “constructive sale”, "wash sale" or other integratedtransaction. In addition, this summary is limited to U.S. Holders who hold the ordinary shares or ADSs as capital assets within the meaning of Section 1221 ofthe Code. For purposes of this discussion, a “U.S. Holder” is a beneficial owner of the ordinary shares or ADSs that is, for U.S. federal income tax purposes,(i) an individual who is a citizen or resident of the United States; (ii) a corporation, or other entity taxable as a corporation, created or organized in or under thelaws of the United States, any state thereof or the District of Columbia; (iii) any estate the income of which is subject to U.S. federal income taxation regardlessof its source; or (iv) any trust if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S.persons have the authority to control all substantial decisions of the trust, or if a valid election is in place to treat the trust as a U.S. person for U.S. federalincome tax purposes. If any entity or arrangement treated as a partnership for U.S. federal income tax purposes holds the ordinary shares or ADSs the U.S. federalincome tax treatment of a partner in the partnership generally will depend upon the status of the partner and status and the activities of the partnership. Apartnership considering an investment in the ordinary shares or ADSs, and partners in such a partnership, should consult their tax advisers regarding the U.S.federal income tax consequences of the purchase, ownership and disposition of the ordinary shares or ADSs. The following discussion generally assumes that we are not, and will not become, a passive foreign investment company ("PFIC"), as definedbelow under “Passive Foreign Investment Company Rules.” Prospective purchasers of the ordinary shares or ADSs should consult their tax advisers concerning the tax consequences of holding ordinaryshares or ADSs in light of their particular circumstances, including the application of the U.S. federal income tax considerations discussed below, as well as theapplication of other federal, state, local, non-U.S. or other tax laws and possible changes in tax law. Tax Treatment of the ADSs The discussion below assumes that the representations contained in the deposit agreement are true and that the obligations in the depositagreement and any related agreements will be complied with in accordance with their terms. For U.S. federal income tax purposes, a beneficial owner of theADSs generally will be treated as the owner of the ordinary shares represented by such ADSs. Accordingly, no gain or loss will be recognized upon anexchange of the ADSs for the 128
Page 138
Table of Contents ordinary shares. The U.S. Treasury has expressed concerns that intermediaries in the chain of ownership between the U.S. Holder of an ADS and the issuer ofthe security underlying the ADS may be taking actions that are inconsistent with the beneficial ownership of the underlying ordinary shares. Accordingly, thecreditability of foreign taxes and the availability of the reduced tax rate for dividends received by certain non-corporate U.S. Holders, if any, as describedbelow, could be affected by actions taken by intermediaries in the chain of ownership between the U.S. Holder of an ADS and us. Dividends The gross amount of distributions paid with respect to the ordinary shares or ADSs (other than certain pro rata distributions of ordinary shares toall shareholders), including the amount of any Argentine taxes withheld, will be treated as dividends on the date actually or constructively received to the extentpaid out of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles). Distributions in excess of our current andaccumulated earnings and profits will be treated first as a non-taxable return of capital, thereby reducing the U.S. Holder’s adjusted tax basis in the ordinaryshares or ADSs (but not below zero), and thereafter as either long-term or short-term capital gain depending upon whether the U.S. Holder held the ordinaryshares or ADSs for more than one year as of the time such distribution is actually or constructively received. Because we do not maintain calculations of ourearnings and profits under U.S. federal income tax principles, it is expected that distributions generally will be reported to U.S. Holders as dividends. Thedividends will be treated as foreign-source income and will not be eligible for the dividends-received deduction generally available to U.S. corporations withrespect to dividends received from certain other corporations. Dividends received by certain non-corporate U.S. Holders will generally be subject to taxation at reduced rates if the dividends are “qualifieddividends”. Subject to applicable limitations, dividends paid with respect to the ordinary shares or ADSs will be treated as qualified dividends if (i) the ordinaryshares or ADSs, as applicable, are readily tradable on an established securities market in the United States and (ii) we were not, in the year prior to the year inwhich the dividend was paid, and are not, in the year in which the dividend is paid, a PFIC. Our ADSs, but not the ordinary shares themselves, have beenapproved for listing on the NYSE. The ADSs will qualify as readily tradable on an established securities market in the United States so long as they are solisted. Based on existing guidance, however, we do not believe that the ordinary shares that are not represented by ADSs will qualify as readily tradeable on anestablished securities market in the United States. As a result, we believe that only dividends we pay with respect to the ordinary shares that are represented byADSs (as opposed to the ordinary shares that are not represented by ADSs) currently have the potential to be treated as qualified dividends. As discussed belowunder “Passive Foreign Investment Company Rules”, we do not believe we were a PFIC for the taxable year ending December 31, 2024. Dividends paid in pesos will be included in a U.S. Holder’s income in a U.S. dollar amount calculated by reference to the exchange rate in effecton the date of actual or constructive receipt, regardless of whether the payment is in fact converted into U.S. dollars. If such a dividend is converted into U.S.dollars on the date of receipt, a U.S. Holder generally should not be required to recognize foreign currency gain or loss in respect of the dividend income. Ifsuch a dividend is not converted into U.S. dollars on the date of receipt, a U.S. Holder generally will have a basis in the pesos equal to their U.S. dollar value onthe date of receipt. A U.S. Holder generally will be required to recognize foreign currency gain or loss realized on a subsequent conversion or other dispositionof such pesos, which will generally be treated as U.S.-source ordinary income or loss. Dividends received by U.S. Holders will generally constitute passive category income for U.S. foreign tax credit purposes. Subject to limitationsunder U.S. federal income tax law concerning credits or deductions for foreign taxes, any Argentine taxes withheld from cash dividends on the ordinary sharesor ADSs will be treated as a foreign income tax eligible for credit against a U.S. Holder’s U.S. federal income tax liability (or at a U.S. Holder’s election, maybe deducted in computing taxable income if the U.S. Holder has elected to deduct all foreign income taxes for the taxable year). However, amounts withheld onaccount of the Argentine personal assets tax (as defined in “ —Material Argentine Tax Considerations”) will likely not be eligible for credit against a U.S.Holder’s U.S. federal income tax liability. Further, the final U.S. Treasury regulations ("Final FTC Regulations") require non-U.S. income tax laws to meetcertain requirements in order for such taxes to be creditable for U.S. Holders, and we have not determined whether these requirements have been met withrespect to Argentine or any other relevant non-U.S. withholding taxes. However, recent notices (the “Notices”) from the IRS indicate that the U.S. Treasury andthe IRS are considering proposing amendments to the Final FTC Regulations and allow taxpayers, subject to certain conditions, to defer the application ofmany aspects of the Final FTC Regulations until the date when a notice or other guidance withdrawing or modifying this temporary relief is issued (or any laterdate specified in such notice or other guidance). The rules with respect to foreign tax credits are complex and U.S. Holders are urged to consult theirindependent tax advisers regarding the availability of the foreign tax credit under their particular circumstances. 129
Page 139
Table of Contents Sale or Other Disposition Upon a sale or other taxable disposition of the ordinary shares or ADSs, U.S. Holders will recognize gain or loss for U.S. federal income taxpurposes in an amount equal to the difference between the U.S. dollar value of the amount realized on the disposition and the U.S. Holder’s adjusted tax basis,determined in U.S. dollars, in the ordinary shares or ADSs. Generally, such gain or loss will be capital gain or loss, and will be long-term capital gain (taxable ata reduced rate for certain non-corporate U.S. Holders, such as individuals) or loss if the ordinary shares or ADSs were held by the U.S. Holder for more thanone year. The deductibility of capital losses is subject to significant limitations. A U.S. Holder’s adjusted tax basis in the ordinary shares or the ADSs generally will equal the cost of such ordinary shares or the ADSs, adjustedby the amount, if any, of distributions in excess of our current and accumulated earnings and profits, and the amount realized on a sale, exchange or othertaxable disposition of the ordinary shares or the ADSs will be the amount received determined on the date of disposition. If an Argentine tax is withheld on thesale or other disposition of the ordinary shares or ADSs, a U.S. Holder’s amount realized will include the gross amount of the proceeds of the sale or otherdisposition before deduction of the Argentine tax. See “ —Material Argentine Tax Considerations—Capital Gains” for a description of when a disposition ofthe ordinary shares or ADSs may be subject to taxation by Argentina. This gain or loss will generally be U.S. source gain or loss for foreign tax credit purposes.Therefore, a U.S. Holder may have insufficient foreign source income to utilize foreign tax credits attributable to any Argentine tax imposed on a sale ordisposition. Moreover, subject to the Notices described above, under the Final FTC Regulations, non-U.S. taxes on disposition gains of U.S. Holders are likelynot creditable for U.S. federal income tax purposes. Any such Argentine tax on disposition gains that are not creditable may reduce the amount realized fromthe sale or other disposition or alternatively may be deductible. U.S. Holders should consult their tax advisers as to whether the Argentine tax on gains may becreditable against the U.S. Holder’s U.S. federal income tax liability. Passive Foreign Investment Company Rules The foregoing discussion of dividends and capital gains assumes that we are not a PFIC for U.S. federal income tax purposes. A non-U.S.corporation will generally be classified as a PFIC for U.S. federal income tax purposes in any taxable year in which the corporation satisfies either of thefollowing requirements: • at least 75% of its gross income is “passive income;” or • at least 50% of the quarterly average gross fair market value of its assets is attributable to assets that produce “passive income” or are held forthe production of “passive income”. Passive income for this purpose generally includes, for example dividends, interest, royalties, rents and gains from commodities and securitiestransactions. In addition, there is a look-through rule for investments in subsidiary corporations. Under this rule, if a non-U.S. corporation owns (directly orindirectly) at least 25 percent of another corporation, the non-U.S. corporation is treated as owning its proportionate share of the assets of the other corporationand earning its proportionate share of the income of the other corporation for purposes of determining if the non-U.S. corporation is a PFIC. Based upon the composition of our income, our assets, the nature of our business, and the current price of our ordinary shares and ADSs, ourcompany does not believe it was a PFIC for the taxable year ending December 31, 2024. There can be no assurance, however, that our company will not beconsidered to be a PFIC for any particular year because PFIC status is factual in nature, depends upon factors not wholly within our company’s control,generally cannot be determined until the close of the taxable year in question, and is determined annually. If our company is a PFIC for any taxable year duringwhich a U.S. Holder holds ordinary shares or ADSs and any of our company’s non-U.S. subsidiaries are also a PFIC, such U.S. Holder will be treated asowning a proportionate amount (by value) of the shares of the lower-tier PFIC for purposes of the application of these rules. U.S. Holders are urged to consulttheir tax advisers about the application of the PFIC rules to any of our company’s subsidiaries. If we were a PFIC in any taxable year, materially adverse U.S. federal income consequences could result for U.S. Holders. If we were a PFIC forany taxable year during which a U.S. Holder owned ordinary shares or ADSs, gains recognized by such U.S. Holder on a sale or other disposition (including,under certain circumstances, a pledge) of ordinary shares or ADSs would be allocated ratably over the U.S. Holder’s holding period for such ordinary shares orADSs. The amount allocated to the taxable year of the sale or other disposition and to any year before we became a PFIC would be taxed as ordinary income.The amount allocated to each other taxable year would be subject to tax at the highest rate in effect for individuals or corporations, as appropriate, and aninterest charge would be imposed on the amount allocated to each such taxable year. Further, any distribution on the ordinary shares or ADSs in excess of 125%of the average of the annual distributions on such ordinary shares or ADSs received by a U.S. Holder during the preceding three years or the 130
Page 140
Table of Contents U.S. Holder’s holding period, whichever is shorter, would be subject to taxation in the same manner as gain, as described immediately above. If we are classified as a PFIC in any year that a U.S. Holder is a shareholder, we generally will continue to be treated as a PFIC for that U.S.Holder in all succeeding years, even if we cease to be a PFIC in such years. If a U.S. Holder owns ordinary shares or ADSs during any taxable year in which we are a PFIC, that holder generally will be required to file anIRS Form 8621 annually, generally with the U.S. Holder's U.S. federal income tax return for that year unless specified exceptions apply. Significant penaltiesare imposed for failure to file IRS Form 8621, and the failure to file such form may suspend the running of the statute of limitations. Certain elections may be available that would result in alternative treatment (such as mark-to-market treatment) of the ordinary shares or ADSs ifwe were a PFIC. U.S. Holders should assume, however, that a “qualified electing fund” or “QEF election” will not be available with respect our ordinary sharesor ADSs. U.S. Holders should consult their tax advisers to determine whether any of these elections would be available and, if so, what the consequences of thealternative treatment would be in their particular circumstances and regarding the application of the PFIC rules to their investment in the ordinary shares orADSs generally. Information Reporting and Backup Withholding Payments of dividends and proceeds from the sale or other taxable disposition (including redemption) of the ordinary shares or ADS by a U.S. orU.S.-connected paying agent or other U.S. or U.S.-connected intermediary, or made into the United States, generally will be reported to the IRS, unless the U.S.Holder is a corporation or otherwise establishes a basis for exemption. In addition, certain U.S. Holders may be subject to backup withholding in respect ofsuch payments if they do not provide their taxpayer identification numbers or certification of exempt status. Backup withholding is not an additional tax. The amount of any backup withholding from a payment to a U.S. Holder will be allowed as a creditagainst the U.S. Holder’s U.S. federal income tax liability and may entitle the U.S. Holder to a refund, provided that the required information is timelyfurnished to the IRS. Foreign Financial Asset Reporting Certain U.S. Holders that own “specified foreign financial assets”, the aggregate value of which exceeds US$50,000 on the last day of the taxableyear (or the aggregate value of which exceeds US$75,000 at any time during the taxable year), generally are required to file an information report with respectto such assets with their tax returns for each year in which they hold the ordinary shares or ADSs, subject to certain exceptions. The ordinary shares and ADSsgenerally will constitute specified foreign financial assets subject to these reporting requirements unless the ordinary shares or ADSs, as applicable, are held inan account at certain financial institutions. U.S. Holders are urged to consult their tax advisers regarding the application of these disclosure requirements to theirownership of the ordinary shares or ADSs. F. Dividends and Paying Agents Not applicable. G. Statement by Experts Not applicable. H. Documents on Display We file reports, including annual reports on Form 20-F, and other information with the SEC pursuant to the rules and regulations of the SEC thatapply to foreign private issuers. As a foreign private issuer, we are exempt from the rules under the Exchange Act relating to the furnishing and content of proxystatements, and our officers, directors and principal shareholders are exempt from the reporting and short-swing profit recovery provisions contained in Section16 of the Exchange Act. In addition, we are not required under the Exchange Act to file periodic reports and financial statements with the SEC as frequently oras promptly as U.S. companies whose securities are registered under the Exchange Act. However, we intend to file with the SEC, within 120 days after the endof each subsequent fiscal year, an annual report on Form 20-F containing financial statements audited by our independent auditors. We also intend to furnishwith the SEC reports on Form 6-K containing unaudited quarterly financial information. Any filings we make electronically are available to the public over theInternet at the SEC’s web site at http://www.sec.gov/. 131
Page 141
Table of Contents We will post our annual reports filed with the SEC on our website at http://www.lomanegra.com. The information contained on our website is notpart of this or any other report filed with or furnished to the SEC. We will also furnish hard copies of such reports to our shareholders free of charge uponwritten request. I. Subsidiary Information Not applicable. J. Annual Report to Security Holders Not applicable. ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are exposed to market risks arising from our normal business activities. These market risks principally involve the possibility that changes ininterest rate or exchange rates will adversely affect the value of our financial assets and liabilities or future cash flows and earnings. Liquidity risk is the risk ofus not complying with all of our obligations as a result of a decrease in the fair value of our investments, an excessive concentration of liabilities from aparticular source, the mismatch between assets and liabilities, the lack of liquidity of assets or the funding of long term assets with short-term liabilities, amongother possible risks. We could enter into derivatives and other financial instruments for purposes other than trading, in order to manage and reduce the impact offluctuations in foreign currency exchange rates. These instruments are intended to reduce the impacts of any devaluation of the peso against the U.S. dollar andany increase in international interest rates on U.S. dollar liabilities. Interest Rate Risk We are exposed to interest rate risk because a significant portion of our indebtedness bears interest at floating rates. As of December 31, 2024, ourtotal outstanding borrowings on a consolidated basis was Ps. 170,901 million, where 9% of the company's consolidated loans accrued interest at a variable rate. In the event that the average BADLAR rate applicable to our financial liabilities during the year ended December 31, 2024 were 1.0% higher thanthe average interest rate during such period, our financial expenses in the same period would have increased by approximately 201 million. At the end of thereporting period there was no debt accruing interests on a BADLAR basis. Foreign Currency Exchange Rate Risk Our liabilities that are exposed to foreign currency exchange rate risk are denominated in U.S. dollars. To partially offset our risk of anydepreciation of the peso against the U.S. dollar, from time to time we may enter into derivative or dollar linked contracts. Because we borrow in U.S. dollars ininternational or local markets to fund our operations and investments, we are exposed to market risks from changes in foreign exchange rates and interest rates. Our foreign currency exposure gives rise to market risks associated with exchange rate movements. A significant portion of our borrowings aredenominated in foreign currency. As of December 31, 2024, our consolidated foreign currency-denominated borrowings was Ps. 156,366 million, denominatedin U.S. dollars. As of December 31, 2024 we did not have foreign currency derivative financial instruments. In the event that the peso was to depreciate by 25% against the U.S. dollar as compared to the peso/U.S. dollar exchange rate as of December 31,2024, our foreign currency denominated indebtedness as of December 31, 2024 would have increased by approximately Ps. 42,031 million. Additionally, considering the exchange regulations and restrictions currently applicable in Argentina, the Group constantly monitors thealternatives for collecting assets and settling liabilities in foreign currency and the related impact. The gain/loss arising from the use of financial instruments tosettle transactions in foreign currency is recognized when the Group unconditionally commits to or irreversibly executes such settlement. As of December 31,2024, the use of financial instruments to settle the above transactions would result in an impact of approximately 15%. 132
Page 142
Table of Contents Liquidity Risk Our board of directors has the ultimate responsibility for liquidity risk management and has established an appropriate framework allowing ourmanagement to handle financing requirements for the short-, medium-and long-term. We manage liquidity risk by maintaining reserves, obtaining loanfacilities, continuously monitoring projected and real cash flows, and reconciling maturity profiles of financial assets and liabilities. We consider that the liquidity risk exposure is low since we have been generating cash flow from our operating activities, supported on strongprofits and have access to loans and financial resources. However, if we are unable to access the capital markets to finance our operations in the future, thiscould adversely affect our ability to obtain additional capital to grow our business. See “Item 3.D Key Information—Risk Factors—Risks Relating to OurBusiness and Industry—Management’s plans to obtain sufficient funds to settle current liabilities may not be accomplished and hence we may have negativeworking capital in the near future”. ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES A. Debt Securities Not applicable. B. Warrants and Rights Not applicable. C. Other Securities Not applicable. D. American Depositary Shares Fees and Expenses The depositary may charge, and collect from, (i) each person to whom ADSs are issued, including, without limitation, issuances against deposits ofshares, issuances in respect of share distributions, rights and other distributions, issuances pursuant to a stock dividend or stock split declared by us, orissuances pursuant to a merger, exchange of securities or any other transaction or event affecting the ADSs, and (ii) each person surrendering ADSs forwithdrawal of deposited securities or whose ADSs are cancelled or reduced for any other reason, US$5.00 for each 100 ADSs (or portion thereof) issued,delivered, reduced, cancelled or surrendered, or upon which a share distribution or elective distribution is made or offered (as the case may be). In addition, the following additional fees, charges and expenses shall also be incurred by an ADS holder: (1) a fee of US$0.05 or less per ADS held for any cash distribution made, or for any elective cash/stock dividend offered, pursuant to the depositagreement; (2) a fee for the distribution or sale of securities, such fee being in an amount equal to the fee for the execution and delivery of ADSs referred toabove which would have been charged as a result of the deposit of such securities but which securities or the net cash proceeds from the sale thereof are insteaddistributed by the depositary to the ADS holders entitled thereto; (3) an aggregate fee of US$0.05 or less per ADS per calendar year (or portion thereof) for services performed by the depositary in administeringthe ADRs (which fee may be charged on a periodic basis during each calendar year and shall be assessed against ADS holders as of the record date or recorddates set by the depositary during each calendar year and shall be payable at the sole discretion of the depositary by billing such ADS holders or by deductingsuch charge from one or more cash dividends or other cash distributions), and (4) an amount for the reimbursement of such charges and expenses as are incurred by the depositary and/or any of its agents (including, withoutlimitation, the custodian and charges and expenses incurred on behalf of ADS holders in connection with compliance with foreign exchange control regulationsor any law or regulation relating to foreign investment) in connection with the servicing of the shares, the sale of securities (including, without limitation,deposited 133
Page 143
Table of Contents securities), the delivery of deposited securities or otherwise in connection with the depositary’s or its custodian’s compliance with applicable law, rule orregulation (which charges and expenses may be assessed on a proportionate basis against ADS holders as of the record date or dates set by the depositary andshall be payable at the sole discretion of the depositary by billing such ADS holders or by deducting such charge or expense from one or more cash dividends orother cash distributions). We will pay all other fees, charges and expenses of the depositary and any agent of the depositary (except the custodian) pursuant to agreementsfrom time to time between us and the depositary, except: (i) stock transfer or other taxes and other governmental charges (which are payable by ADS holders orpersons depositing shares); (ii) a transaction fee per cancellation request (including through SWIFT, telex and facsimile transmission) as disclosed on the“Disclosures” page (or successor page) of www.adr.com (as updated by the Depositary from time to time, “ADR.com”) and any applicable delivery expenses(which are payable by such persons or Holders); an (iii) transfer or registration expenses for the registration or transfer of deposited securities on any applicableregister in connection with the deposit or withdrawal of deposited securities (which are payable by persons depositing shares or ADS holders withdrawingdeposited securities). The right of the depositary to receive payment of fees, charges and expenses as provided above shall survive the termination of the depositagreement. Upon the resignation or removal of the depositary, such right shall extend for those fees, charges and expenses incurred prior to the effectiveness ofsuch resignation or removal. The depositary anticipates reimbursing us for certain expenses incurred by us that are related to the establishment and maintenance of the ADRprogram upon such terms and conditions as the company and the depositary may agree from time to time. For the year ended December 31, 2024, theDepositary reimbursed us the agreed amount under the ADR program. The depositary may make available to us a set amount or a portion of the depositary feescharged in respect of the ADR program or otherwise upon such terms and conditions as we and the depositary may agree from time to time. PART II ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES None. ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS A. Material Modifications to the Rights of Security Holders None. B. Material Modifications to the Rights of any Class of Registered Securities None. C. Withdrawal or Substitution of a Material Amount of the Assets Securing any Class of Registered Securities None. D. Changes in the Trustee or Paying Agents for any Registered Securities None. E. Use of Proceeds Not applicable. ITEM 15. CONTROLS AND PROCEDURES 134
Page 144
Table of Contents Disclosure Controls and Procedures Our management, with the participation of our CEO and CFO, has evaluated the effectiveness of our disclosure controls and procedures, as thatterm is defined under Rules 13a-15(e) and 15d-15(e) of the Exchange Act, as amended, as of December 31, 2024. There are inherent limitations to theeffectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controlsand procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. Weperformed an evaluation of the effectiveness of our disclosure controls and procedures that are designed to ensure that information required to be disclosed inthe reports that we file with or submit to the SEC under the Exchange Act, as amended, is recorded, processed, summarized and reported, within the timeperiods specified in the SEC’s rules and forms and is communicated to our management, including our CEO and CFO, as appropriate, to allow timely decisionsregarding the required disclosure. Based upon our evaluations, our CEO and CFO have concluded that our disclosure controls and procedures were effective toprovide reasonable assurance of their reliability, as of December 31, 2024. Management’s Annual Report on Internal Control over Financial Reporting Our management, under the supervision of our CEO and CFO, is responsible for establishing and maintaining adequate internal control overfinancial reporting, as that term is defined under Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. Our internal control over financialreporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for externalpurposes in accordance with IFRS Accounting Standards. Our internal control over financial reporting includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of ourcompany; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with IFRSAccounting Standards, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directorsof the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisitions, use or disposition of our company’sassets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of anyevaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions, or that the degree ofcompliance with the policies or procedures may deteriorate. As required by Section 404(a) of the Sarbanes-Oxley Act of 2002 and related rules as promulgated by the SEC, our management, with theparticipation of our CEO and CFO, assessed the effectiveness of our internal control over financial reporting as of December 31, 2024. In making thisassessment, management used the criteria established in the framework in Internal Control—Integrated Framework (2013 Framework) issued by the Committeeof Sponsoring Organizations of the Treadway Commission. Based on such assessment, our management concluded that our internal control over financialreporting was effective as of December 31, 2024. Attestation Report of the Independent Registered Public Accounting Firm As required by Section 404(b) of the Sarbanes-Oxley Act of 2002 and related rules as promulgated by the SEC, Pistrelli, Henry Martin yAsociados S.A., a member of Ernst & Young Global Limited, the independent registered public accounting firm that audited our financial statements for thefiscal year ended December 31, 2024 included in this annual report, has issued an attestation report on the effectiveness of our internal control over financialreporting set forth in our audited consolidated financial statements, which are included in this annual report beginning at Page F-1. Changes in Internal Control over Financial Reporting During the Year Ended December 31, 2024 There have not been any changes in our internal control over financial reporting during the year of 2024 that have materially affected or arereasonably likely to materially affect our internal control over financial reporting. ITEM 16. [RESERVED] 135
Page 145
Table of Contents ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT Our board of directors has determined that Cesar Javier Graña who is currently serving on our Audit Committee, is “audit committee financialexperts” as defined by the SEC’s rules, have the requisite accounting or related financial management expertise under the rules of the NYSE and is independentunder CNV regulations, Rule 10A-3 and the applicable NYSE standards. Mr. Graña's biographical information is included in “Directors, Senior Managementand Employees”. ITEM 16B. CODE OF ETHICS As of September 24, 2024, Loma Negra adopted and communicated the new version of the Code of Ethics, named Code of Ethics and Conduct,which complies with NYSE and local regulation’s standards. Likewise, the Code of Ethics and Conduct is posted on our web site at:http://www.lomanegra.com/en/compliance/. Such Code of Ethics and Conduct applies to our employees, directors, managers, shareholders and officers as wellas contractors, subcontractors, brokers, suppliers, customers and generally, all parties that provide services to Loma Negra, or on its behalf. Pursuant to Item16B of Form 20-F, if a waiver or amendment of the code of ethics and conduct applies to our chief executive officer, chief financial officer or other personsperforming similar functions and relates to standards promoting any of the values described, we will disclose such waiver or amendment on our website withinfour business days following the date of amendment or waiver in accordance with the requirements of Instruction 4 to such Item 16B. In addition, we did notgrant any waivers to our Code of Ethics and Conduct during the year ended December 31, 2024. ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES The following table describes the amounts billed to us by the independent registered public accounting firm, Pistrelli, Henry Martin y AsociadosS.A. (member of Ernst & Young Global Limited), for audit and other services performed in fiscal years 2024 and 2023 (stated in the current measurement unitas of December 31, 2024): 2024 2023 (In thousands of Ps.) Audit fees 1,848,493 1,964,234 Tax fees 39,322 11,398 All other fees – 1,842 Total 1,887,815 1,977,474 ________________(1) Includes fees for professional services rendered by the principal accountant for the audit of the registrant’s annual financial statements and internal controlover financial reporting of the company. It includes the audit of annual consolidated financial statements and reviews of quarterly consolidated financialstatements. Also includes services typically provided by the accountant in connection with statutory and regulatory filings or engagements.(2) Includes fees for professional services rendered by our independent registered public accounting firm, in each fiscal year, for tax and social securitycompliance and routine consulting.(3) Includes fees for training services rendered by our independent registered public accounting firm. The Audit Committee approved 100% of the fees paid to the independent registered public accounting firm for audit-related, non-audit and taxfees in fiscal year 2024. The engagement of any service rendered by our external auditor or any of its affiliates to Loma Negra or any of its subsidiaries must always havethe prior approval of our Audit Committee. Such committee has developed a pre-approval policy regarding the engagement of professional services by ourexternal auditor in accordance with the Sarbanes-Oxley Act. This policy establishes the obligation to obtain prior approval from our Audit Committee for anyservice to be rendered by our external auditor to Loma Negra or any of its subsidiaries. The Audit Committee has delegated the authority to grant pre-approvals for the auditor’s services to one of its members. The decision of thismember to pre-approve a service is presented to the full Audit Committee at the next scheduled meeting. The General Annual Shareholders’ Meeting designates the external auditor. (1) (2) (3) 136
Page 146
Table of Contents ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES Not applicable. ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS Period (a) Total Numberof Shares (orUnits) Purchased (b) Average Priceper Share (orUnits) (c) Total Numberof Shares (orUnits) Purchasedas Part of PubliclyAnnounced Plansor Programs (d) Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans of Programs 2024 CommonShares ADR CommonShares ADR(US$) Common Shares(*) January (1-2) — 25,650 — 7.0 128,250 for up to Ps.600 million, or any loweramount resulting in such acquisitionreaching 10% of our capital stock. (i) March (from 3-11 to 3-14) — 39,974 — 6.8 199,870 for up to Ps.900 million, or any loweramount resulting in such acquisitionreaching 10% of our capital stock. (i) ________________(*) Each ADR represents 5 common shares (i) On December 19, 2023, in accordance with Section 11 of Chapter I, Title II and Section 2, Chapter I, Title XII of the CNV Regulations (2013 revisedversion) our board of directors approved and announced a share repurchase, in accordance with Section 64 of the LMC and the CNV Regulations. Theplan’s purpose was to acquire shares to implement specific compensation programs or plans. The share repurchase has the following terms and conditions:(a) the maximum amount to invest is up to Ps. 600,000,000; (b) repurchased shares in treasury shall never surpass the limit of 10% of the capital stock inaccordance with Section 64 of the LMC, and all of the shares issued by our Company are fully paid; (c) the price per share is up to Ps. 2,000 per share inBYMA and up to US$ 8.5 per ADR in the NYSE; and (d) the period in which the acquisitions will be performed was until March 30, 2024 and commenceafter one Argentine business day has elapsed following the date of disclosure of the relevant event informing the repurchase plan to the market and subjectto any period renewal or extension approved by the board of directors, which will be duly informed. ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT Not applicable. ITEM 16G. CORPORATE GOVERNANCE Because we are a “foreign private issuer” and a “controlled company”, the NYSE rules applicable to us are considerably different from thoseapplied to domestic companies that are not “controlled companies”. Accordingly, we take advantage of certain exemptions from NYSE governancerequirements provided in the NYSE rules for “foreign private issuers”. Subject to the items listed below, we currently follow certain Argentine practicesconcerning corporate governance: • Director Independence. The NYSE rules provide that the board of directors of a domestic listed company must have a majority ofindependent directors in accordance with NYSE independence requirements. “Controlled companies” are not required to comply with thisrequirement. Under Argentine corporate governance practices, an Argentine company is not required to have a majority of independentmembers on its board of directors. Currently, our board of directors is composed of seven members of whom three are independent inaccordance with CNV independence requirements. 137
Page 147
Table of Contents • Executive Sessions. The NYSE rules require the non-management directors of domestic listed companies to meet at regularly scheduledexecutive sessions without management being present. There is no similar requirement under Argentine law, however the Code of CorporateGovernance of the CNV includes as a good practice the holding of board of directors meetings where only non-executive directors (includingindependent Directors) participate regularly. Loma Negra has adopted such practice. Under Argentine law there is a requirement that theboard of directors meets at least once every three (3) months. • Audit Committee. The NYSE rules require domestic listed companies to have an audit committee with a minimum of three independentdirectors and a written charter that covers certain minimum specified duties. In addition, the audit committee must comply with Rule 10A-3and have at least one member with requisite accounting or related financial management expertise and each member of the audit committeemust satisfy the independence and financial literacy set forth in the NYSE rules. As a foreign private issuer, we are only required to complywith Rule 10A-3. Pursuant to the LMC, and its corresponding regulations, listed companies in Argentina are required to have an auditcommittee consisting of at least three members of our board of directors, the majority of which must be independent directors. We haveelected to voluntarily comply with all financial management expertise, independence and financial literacy requirements of the NYSE. TheAudit Committee has a written charter describing its duties and responsibilities. • Compensation and Nominating/Corporate Governance Committees. The NYSE rules require domestic listed companies to maintaincompensation and nominating/corporate governance committees, which must consist solely of independent directors and must have a writtencharter that addresses certain matters specified in the listing standards. “Controlled companies” are not required to comply with thisrequirement. Under Argentine law, an Argentine company may, but is not required to, form special governance committees, which may becomposed partially or entirely of non-independent directors. As of the date of this annual report, the Company has the following Committees:(i) Results, Finance and Strategy Committee; (ii) People and Governance Committee; (iii) Risk and Reputation Committee; (iv) Ethics &Compliance Committee; (v) Disclosure Policy Committee; (vi) Committee for the Approval of Transactions with Securities; and (vii) AuditCommittee. For more information, see “Item 6 C. Committees of the Board of Directors” • Shareholder Approval of Equity Compensation Plans. The NYSE rules require shareholders of domestic listed companies to be given theopportunity to vote on all equity-compensation plans and material revisions thereto, with limited exemptions. Under Argentine law, the basicterms of the equity-compensation plans should be considered at the general shareholders’ meeting, but permits delegation to the board ofdirectors. We have elected to rely on the exemption from these NYSE rules requirement available to foreign private issuers and we complywith our home country practices regarding corporate governance. • Corporate Governance Guidelines. The NYSE rules require domestic listed companies to adopt and disclose corporate governance guidelinesthat cover certain minimum specified subjects related to director qualifications and responsibilities. Argentine law does not require theadoption or disclosure of corporate governance guidelines. The CNV Rules contain recommended guidelines for listed companies referred toas Code of Corporate Governance and the board of directors must describe the level of compliance with the guidelines and recommendationsin such Code of Corporate Governance in its annual report. As of the date of this annual report, we are in the process of adopting a corporategovernance manual which shall be in compliance with the CNV Rules and shall comprise all corporate governance practices already adoptedby Loma Negra. Notwithstanding this, we file on an annual basis before CNV a report regarding the status of compliance of suchrecommended corporate governance guidelines. • Code of Ethics and Conduct. The NYSE rules require domestic listed companies to adopt and disclose a code of ethics and conduct fordirectors, officers and employees, and promptly disclose any waivers of the code for directors or executive officers. We are currently subjectto Loma Negra’s code of corporate conduct. Such Code of Ethics and Conduct applies to our employees, directors, managers, shareholdersand officers as well as contractors, subcontractors, brokers, suppliers, customers and generally, all parties that provide services to LomaNegra, or on its behalf. The Code of Ethics and Conduct is available on our website at https://www.lomanegra.com/compliance/ . Furthermore, as a “controlled company”, we are eligible to, and, in the event we no longer qualify as a “foreign private issuer”, we intend to, electnot to comply with certain of the NYSE corporate governance standards, 138
Page 148
Table of Contents including the requirement that a majority of directors on our board of directors are independent directors and the requirement to maintain a compensation,nominating/corporate governance committee consisting entirely of independent directors. For additional information, see “Item 3.D Key Information—RiskFactors—Risks Relating to Our Ordinary Shares and the ADSs—Our status as a “foreign private issuer” and as a “controlled company” allows us to followalternate standards to the corporate governance standards of the NYSE, which may limit the protections afforded to investors”. ITEM 16H. MINE SAFETY DISCLOSURE Not applicable. ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not applicable. ITEM 16J. INSIDER TRADING POLICIES On November 1, 2017, our board of directors adopted an Insider Trading Policy, amended by the board of directors on July 4, 2018 and again onMay 11, 2020. This policy establishes comprehensive procedures and restrictions on trading in the Company's securities by Loma Negra personnel, as well assecurities of any other companies. It is designed to promote compliance with applicable insider trading laws, which are enforced in Argentina and the U.S., aswell as with rules, regulations, and any listing standards applicable to our company. The policy applies to all directors, officers, employees of Loma Negra, supervisory board members, controlling shareholders and theirrepresentatives or employees and it includes specific procedures and restrictions to prevent inadvertent violations of insider trading laws and manages potentialadverse impacts on the company and its audiences. The policy's rigorous approach to the prevention of insider trading also extends to imposing harsh consequences for failure to adhere to itsguidelines and procedures, including disciplinary action up to immediate termination of service and potential legal prosecution. Loma Negra's Insider Trading Policy serves as an integral part of the company’s overall commitment to legal and ethical conduct, and itsadherence to the stringent regulations that govern its operations in the securities market. A copy of this policy is included as Exhibit 11 to this annual report. ITEM 16K. CYBERSECURITY Definitions. For purposes of this section: (1) Cybersecurity incident means an unauthorized occurrence, or a series of related unauthorized occurrences, on or conducted through a registrant’sinformation systems that jeopardizes the confidentiality, integrity, or availability of a registrant’s information systems or any information residing therein.(2) Cybersecurity threat means any potential unauthorized occurrence on or conducted through a registrant’s information systems that may result in adverseeffects on the confidentiality, integrity, or availability of a registrant’s information systems or any information residing therein.(3) Information systems means electronic information resources, owned or used by the registrant, including physical or virtual infrastructure controlled by suchinformation resources, or components thereof, organized for the collection, processing, maintenance, use, sharing, dissemination, or disposition of theregistrant’s information to maintain or support the registrant’s operations. Risk management and strategy. Loma Negra has processes in place to assess, identify and manage material risks arising from cybersecurity threats, which have been integratedinto its overall risk management programs. We consider cybersecurity incidents a critical risk. Executive management works with our Information SecurityTeam to periodically review our cybersecurity situation and IT-related security risks, as well as our ability and plans to mitigate and respond to cybersecurityrisks. 139
Page 149
Table of Contents We have two specialized Information Security teams, comprised of internal staff and external consultants: the Vulnerability Management andPentesting Team, and the Monitoring and Event Management Team. The Vulnerability Management and Pentesting Team is in charge of identifying and mitigating potential risks in our systems through penetrationtesting and proactive vulnerability management, while the Monitoring and Event Management Team is dedicated to detecting and responding to any deviationsor unusual behavior of our systems that may indicate an intrusion or security threat. Both teams report to the Information Security Leader and work closely together to ensure a comprehensive defense of our systems. Managing security risks associated with third parties (customers and suppliers) is a priority to ensure the protection of our assets and theconfidentiality of sensitive data. To this end, we implement a process of evaluation and monitoring of our suppliers, and we have a policy for hiring technologysuppliers, which requires the participation and approval of the Information Security Leader and the Compliance Leader for all new hires. Governance Our board of directors assumes a central role in strategic oversight, supported by specialized committees for specific risk supervision. Wehighlight the independence of our Information Security team, which reports directly to the CEO and operates independently from IT Management. Thisstructure ensures impartial and effective risk management, which is crucial to our operational integrity and the confidence of our stakeholders. Although we do not have a dedicated cybersecurity committee, this critical area is under the direct supervision of our Internal Audit, Risk andSOX Manager. This manager, in turn, reports to both the Audit Committee and the Risk Committee. Both committees meet quarterly to review and discussinformation security issues, ensuring continuous and specialized oversight. Our cybersecurity oversight strategy is based on industry-leading frameworks such as the National Institute of Standards and Technology (NIST)guidelines and the Center for Internet Security (CIS), complemented by external audits performed by specialized consulting firms. These frameworks enhanceour ability to proactively identify vulnerabilities and manage incidents effectively, aligning our practices with international security standards. Loma Negra developed a Cybersecurity Incident Response Plan that provides a structured and organized framework for the effective managementof cybersecurity incidents. This plan seeks to ensure efficient containment of the attack, eradication of the threat, and operational recovery. In addition, we havea Communication Plan that stipulates the immediate notification of any high or critical risk incident to the relevant committees, ensuring a rapid andcoordinated response. In the process of strengthening our digital defenses, we are implementing Microsoft 365 security tools. This significant technologyupgrade enhances our capabilities in advanced threat protection, identity and access management, as well as incident analysis and response. This advancement,along with our proactive approach to adopting cybersecurity controls, underscores our continued investment in the security of our infrastructure and data. PART III ITEM 17. FINANCIAL STATEMENTS Not applicable. ITEM 18. FINANCIAL STATEMENTS Our audited consolidated financial statements are included in this annual report beginning at Page F-1. ITEM 19. EXHIBITS 140
Page 150
Table of Contents ExhibitNumber Description of Document 1.1 Amended Bylaws of the Registrant, as of April 25, 2023 (incorporated by reference to Exhibit 1.1 to the Registrant's Annual Report onForm 20-F (File No. 001-38262) filed on April 29, 2024). 2.1 Form of Deposit Agreement among the Registrant, JPMorgan Chase Bank, N.A., as depositary, and all holders and beneficial owners fromtime to time of American Depositary Receipts issued thereunder, including the form of American Depositary Receipts (incorporated byreference to Exhibit A to the Registrant’s registration statement on Form F-6 (No. 333-268571) filed on November 28, 2022). 2.2* Description of Registrant’s Securities. 4.1 Know-how Offer Letter from InterCement Participações S.A., dated August 20, 2020 for the transfer of technical know-how relating to thedesigning and manufacturing of building materials for the purpose of optimizing the performance and the operations of the Company(incorporated by reference to Exhibit 4.1. to our Annual Report on Form 20-F (File No. 001-38262), filed on April 30, 2021). 4.2+ Loma Negra Compañía Industrial Argentina Sociedad Anónima Share Incentive Program (incorporated by reference to Exhibit 4.3 to ourRegistration Statement on Form S-8 (File No. 333-260599) filed on October 29, 2021). 4.3+ Loma Negra Compañía Industrial Argentina Sociedad Anónima Share Incentive Program Subject to TSR (incorporated by reference toExhibit 4.4 to our Registration Statement on Form S-8 (File No. 333-260599) filed on October 29, 2021). 8.1 List of Subsidiaries (incorporated by reference to Exhibit 21.1 to the Registrant’s Registration Statement on Form F-1 filed with the SEC onSeptember 5, 2017 (File No.333-220347). 11 Loma Negra S.A. Insider Trading Policy (incorporated by reference to Exhibit 11 to the Registrant's Annual Report on Form 20-F (File No.001-38262) filed on April 29, 2024). 12.1* Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 12.2* Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 13.1** Certification of the Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 15.1* Consent of Pistrelli, Henry Martin y Asociados S.A. 96.1 Technical Report Summary (La Pampita y Entorno) (report date: March 22, 2023; effective date: December 31, 2021) (incorporated byreference to Exhibit 96.1 to Amendment No. 2 to the Registrant's Annual Report on Form 20-F (File No. 001-38262) filed on March 22,2023). 97.1 Loma Negra S.A. Clawback Policy (incorporated by reference to Exhibit 97.1 to the Registrant's Annual Report on Form 20-F (File No.001-38262) filed on April 29, 2024). 101. INS* Inline XBRL Instance Document. 101.SCH* Inline XBRL Taxonomy Extension Schema Document. 101.CAL* Inline XBRL Taxonomy Extension Schema Calculation Linkbase Document. 101.DEF* Inline XBRL Taxonomy Extension Schema Definition Linkbase Document. 101.LAB* Inline XBRL Taxonomy Extension Schema Label Linkbase Document. 101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document. 104* Cover Page Interactive Data File (embedded within the Inline XBRL document). * Filed herewith.** Furnished herewith.+ Management contract or compensatory plan, contract or arrangement. 141
Page 151
Table of Contents SIGNATURES The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized theundersigned to sign this annual report on its behalf. Date: April 29, 2025 Loma Negra C.I.A.S.A. [/s/ Sergio D. Faifman] Name: Sergio D. Faifman Title: Chief Executive Officer [/s/ Marcos I. Gradin] Name: Marcos I. Gradin Title: Chief Financial Officer
Page 152
Table of Contents Loma Negra Compañía IndustrialArgentina Sociedad Anónima Consolidated financial statements as ofDecember 31, 2024
Page 153
Table of Contents Consolidated Financial Statements as of December 31, 2024 and 2023 and for the years ended December 31, 2024, 2023 and 2022 of Loma NegraCompañía Industrial Argentina Sociedad Anónima Report of Independent Registered Public Accounting Firm (Auditor Firm ID: 01449) F-1 Consolidated Statements of Profit or Loss and Other Comprehensive Income for the Years Ended December 31, 2024, 2023 and 2022 F-6 Consolidated Statements of Financial Position as of December 31, 2024 and 2023 F-7 Consolidated Statement of Changes in Shareholders’ Equity for the Years Ended December 31, 2024, 2023 and 2022 F-9 Consolidated Statement of Cash Flows for the Years Ended December 31, 2024, 2023 and 2022 F-12 Notes to the Consolidated Financial Statements for the Years Ended December 31, 2024, 2023 and 2022 F-13
Page 154
Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Board of Directors ofLoma Negra Compañía Industrial Argentina Sociedad Anónima Opinion on the financial statements We have audited the accompanying consolidated statements of financial position of Loma Negra Compañía Industrial Argentina Sociedad Anónima (the“Company”) as of December 31, 2024 and 2023, and the related consolidated statements of profit or loss and other comprehensive income, changes inshareholders´ equity and cash flows for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the“consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of theCompany at December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31,2024, in conformity with IFRS Accounting Standards as issued by the International Accounting Standards Board. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company'sinternal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control-Integrated Framework issued by theCommittee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated April 29, 2025 expressed an unqualified opinionthereon. Basis for opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financialstatements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company inaccordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures toassess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Suchprocedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluatingthe accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Webelieve that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or requiredto be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved ourespecially challenging, subjective or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidatedfinancial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical auditmatters or on the accounts or disclosures to which they relate. F-1
Page 155
Table of Contents Impairment of Property, plant and equipment Description of the matter As of December 31, 2024, the Company’s Property, plant and equipment (“PP&E”) amounts to Argentine pesos (“Ps.”)1,054,198 million. As mentioned in Note 13.1. to the consolidated financial statements, the Company carries out animpairment analysis of the amount of these assets when an indicator is identified and suggests that their carrying amountcould be less than their recoverable value, which is defined as the highest between its fair value less costs of disposal andits value in use. The Company determined the recoverable value of PP&E based on discounted future cash flows,calculated for each cash generating unit (“CGU”). Auditing the Company´s PP&E impairment test is complex and highly judgmental due to the significant assumptions andestimates applied by the Company's Management to determine the recoverable value, that are subject to uncertainty relatedto future events and the impact of the expectations about future market and macroeconomic conditions. How we addressed the matter in ouraudit We obtained an understanding, evaluated the design, and tested the operating effectiveness of the controls over theCompany´s impairment analysis process. For example, we tested controls over the determination of recoverable values,including the valuation models and underlying assumptions used to develop such estimates. To test the impairment analysis of PP&E our audit procedures included, among others, involving professionals withspecialized skills and knowledge in valuation techniques to assist us in evaluating the methodology used by the Companyin the determination of discounted cash flows and the significant assumptions used by the Company for determining futurecash flows, including discount rates, macroeconomic variables, expected growth rates, price variation levels, expectedgross margins, and the required levels of investment in PP&E and working capital for each CGU; comparing thosesignificant assumptions with the Company's historical trend and with information obtained from industry reports and otherexternal information sources; carrying out a sensitivity analysis of changes in the recoverable value in relation to changesin the mentioned significant assumptions; testing the completeness and accuracy of the data used in the recoverable valueestimates and testing the mathematical accuracy of the model developed by the Company. We also evaluated thedisclosures related to this matter included in the consolidated financial statements. F-2
Page 156
Table of Contents Consolidated net assets and disclosures related to the Ferrosur Roca railway concession Description of the matter As mentioned in Note 2.5. to the consolidated financial statements, the Company consolidates the financialinformation of its controlled company Ferrosur Roca S.A., that operates the General Roca National CargoRailway Network pursuant to the concession by the Argentina National Government. The concession originalterm ended in March 2023. As of December 31, 2024, the recorded amounts of the assets and liabilities related tothe concession amount to Ps. 24,653 million and Ps. 19,732 million, respectively. As mentioned in Note 36. to the consolidated financial statements, although the concession contract provided thepossibility of an additional ten-year extension, the Ministry of Transportation has rejected the request for theextension of the concession contracts submitted by all the private railway concessionaires, subsequently grantingthe Company two consecutive temporary extensions for 18 and 12 months, while the stated objective of theNational Government is to begin managing the railroad network infrastructure directly, carrying out thecorresponding investments and allowing the provision of railway services to registered operators. As a result, theconcession of Ferrosur Roca S.A. would end in September 2025. Auditing the recorded amounts of assets and liabilities and the disclosures related to the railway concession ofFerrosur Roca S.A. is complex and highly judgmental due to the assumptions about future events and conditionsused by the Company´s Management to assess the impacts of the termination of the concession and the potentialcontinuity as a railway operator, that are described in Note 36. to the consolidated financial statements. How we addressed the matter in ouraudit We obtained an understanding, evaluated the design, and tested the operating effectiveness of the controls overthe Company´s assessment of the Ferrosur Roca concession. For example, we tested controls over management’sreview of significant assumptions described in Note 36. to the consolidated financial statements. To test management assessment our audit procedures included, among others, obtaining an understanding of thelegal and regulatory framework applicable to the concession; reading the concession contract and other relatedagreements and documentation; reading the Company's internal and external legal advisors’ reports; reading thefilings and correspondence with the relevant authorities in relation to the application to be a railway operator;obtaining an understanding of the plans of the Company in relation to the potential railway operator business andevaluating the assessment performed by the management over the useful lives and recoverability of related assets.We also assessed the Company’s disclosures regarding Ferrosur Roca S.A. railway concession in the consolidatedfinancial statements. /s/ PISTRELLI, HENRY MARTIN Y ASOCIADOS S.A.Member of Ernst & Young Global Limited We have served as the Company’s auditor since 2019. City of Buenos Aires, ArgentinaApril 29, 2025 F-3
Page 157
Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Board of Directors ofLoma Negra Compañía Industrial Argentina Sociedad Anónima Opinion on Internal Control Over Financial Reporting We have audited Loma Negra Compañía Industrial Argentina Sociedad Anónima´s internal control over financial reporting as of December 31, 2024, based oncriteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013framework) (the COSO criteria). In our opinion, Loma Negra Compañía Industrial Argentina Sociedad Anónima (the Company) maintained, in all materialrespects, effective internal control over financial reporting as of December 31, 2024, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidatedstatements of financial position of the Company as of December 31, 2024 and 2023, the related consolidated statements of profit or loss and othercomprehensive income, changes in shareholders´ equity and cash flows for each of the three years in the period ended December 31, 2024, and the relatednotes, and our report dated April 29, 2025 expressed an unqualified opinion thereon. Basis for opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness ofinternal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Ourresponsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registeredwith the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rulesand regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing andevaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considerednecessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting andthe preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control overfinancial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflectthe transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparationof financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only inaccordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation ofeffectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliancewith the policies or procedures may deteriorate. /s/ PISTRELLI, HENRY MARTIN Y ASOCIADOS S.A.Member of Ernst & Young Global Limited City of Buenos Aires, ArgentinaApril 29, 2025 F-4
Page 158
Table of Contents F-5
Page 159
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMACONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEARS ENDED DECEMBER 31, 2024,2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) For the year ended December 31, 2024 Notes 2024 2023 2022 Revenues 5 699,178,686 919,312,709 984,191,542 Cost of sales 6 (512,197,718) (688,685,258) (718,413,301) Gross profit 186,980,968 230,627,451 265,778,241 Selling and administrative expenses 7 (73,175,352) (84,199,865) (84,838,341) Other gains and losses 8 4,555,237 1,999,220 22,957,686 Tax on debits and credits to bank accounts 9 (7,420,391) (10,183,752) (9,868,503) FINANCIAL RESULTS, NET Exchange rate differences 10 (43,708,544) (255,244,812) (50,311,079) Gain on net monetary position 262,879,515 302,169,399 93,223,993 Financial income 10 1,962,889 12,434,159 11,028,678 Financial expenses 10 (82,522,519) (159,671,181) (173,355,745) Profit before tax 249,551,803 37,930,619 74,614,930 INCOME TAX EXPENSE Current 11 (66,450,217) (8,296,615) (27,835,209) Deferred 11 (29,475,071) (8,553,345) (34,526,695) NET PROFIT FOR THE YEAR 153,626,515 21,080,659 12,253,026 Net income attributable to: Owners of the parent company 153,809,532 22,440,931 13,146,795 Non-controlling interest (183,017) (1,360,272) (893,769) NET PROFIT 153,626,515 21,080,659 12,253,026 Total comprehensive income attributable to: Owners of the parent company 153,809,532 22,440,931 13,146,795 Non-controlling interest (183,017) (1,360,272) (893,769) Total comprehensive income 153,626,515 21,080,659 12,253,026 Earnings per share (basic and diluted) 12 263.6068 38.4568 22.4610 The accompanying notes are an integral part of these consolidated financial statements. F-6
Page 160
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMACONSOLIDATED STATEMENT OF FINANCIAL POSITION AS OF DECEMBER 31, 2024, AS COMPARED WITH DECEMBER 31, 2023(figures expressed in thousands of pesos - $ - except as otherwise stated) As of December 31, 2024 Notes 2024 2023 ASSETS Non-current assets Property, plant and equipment 13 1,054,198,440 1,049,899,221 Right of use assets 14 3,176,398 5,545,007 Intangible assets 15 2,897,120 3,452,567 Investments 16 69,400 69,400 Goodwill 17 692,222 692,222 Inventories 18 66,966,508 49,368,121 Other receivables 20 6,253,981 4,024,529 Other assets 680,232 - Total non-current assets 1,134,934,301 1,113,051,067 Current assets Inventories 18 201,763,707 166,558,064 Other receivables 20 13,831,410 47,358,732 Trade accounts receivable 21 49,249,273 49,539,392 Investments 16 578,466 3,724,558 Cash and banks 22 7,974,897 10,940,003 Total current assets 273,397,753 278,120,749 Total assets 1,408,332,054 1,391,171,816 The accompanying notes are an integral part of these consolidated financial statements. F-7
Page 161
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMACONSOLIDATED STATEMENT OF FINANCIAL POSITION AS OF DECEMBER 31, 2024, AS COMPARED WITH DECEMBER 31, 2023(figures expressed in thousands of pesos - $ - except as otherwise stated) As of December 31, 2024 Notes 2024 2023 SHAREHOLDERS’ EQUITY AND LIABILITIES Capital stock and other capital related accounts 23 264,406,795 265,619,053 Reserves 375,127,551 360,154,354 Retained earnings 153,809,532 14,973,197 Equity attributable to owners of the parent company 793,343,878 640,746,604 Non-controlling interest (222,136) (39,119) Total shareholders’ equity 793,121,742 640,707,485 LIABILITIES Non-current liabilities Borrowings 24 70,221,168 239,856,931 Lease liabilities 14 1,798,286 6,038,159 Provisions 26 11,241,035 14,680,570 Salaries and social security contributions 1,508,711 1,146,915 Other liabilities 28 1,010,198 1,040,725 Deferred tax liabilities 11 261,609,813 232,134,742 Total non-current liabilities 347,389,211 494,898,042 Current liabilities Borrowings 24 100,680,037 81,061,928 Lease liabilities 14 1,388,357 2,644,870 Accounts payable 25 93,590,802 124,681,093 Advances from customers 6,411,006 9,542,620 Salaries and social security contributions 17,909,953 19,324,436 Tax liabilities 27 46,844,680 6,426,293 Other liabilities 28 996,266 11,885,049 Total current liabilities 267,821,101 255,566,289 Total liabilities 615,210,312 750,464,331 Total shareholders’ equity and liabilities 1,408,332,054 1,391,171,816 The accompanying notes are an integral part of these consolidated financial statements. F-8
Page 162
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMACONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY AS OF DECEMBER 31, 2024(figures expressed in thousands of pesos - $ - except as otherwise stated) Owners’ contributions Capitalstock Treasuryshares Capitaladjustments TreasurysharesadjustmentsSharepremium Treasurysharespremium Treasurysharestradingpremium Mergerpremium Cost oftreasuryshares Share-basedpaymentplans Legalreserve Environmentalreserve OptionalReservefor FutureDividends Retainedearnings Shareholders’equityattributableto owners ofthe parentcompany Non-controllinginterest Total Balances as ofJanuary 1,2024 58,348 - 93,733,964 - 138,989,677 - 345,889 31,250,508 - 1,240,667 19,161,719 149,573 340,843,062 14,973,197 640,746,604 (39,119) 640,707,485 Share-basedpaymentplans - - - - - - - - - 682,956 - - - - 682,956 - 682,956 Acquisition oftreasurystock (Note23) (33) 33 (52,711) 52,711 (714,733) 714,733 - - (594,830) - - - - - (594,830) - (594,830) Granting ofshare-basedplans (Note23) 33 (33) 52,711 (52,711) 714,733 (714,733) 28,409 - 594,830 (623,239) - - - - - - - Reclassificationof cashshare-basedpaymentplans toliabilities(Note 3.17) - - - - - - - - - (1,300,384) - - - - (1,300,384) - (1,300,384) Appropriationas per Boardof Directors’Resolutionof April 25,2024: - Optional reserve- - - - - - - - - - - - 14,973,197 (14,973,197) - - - Net income forthe year 153,809,532 153,809,532 (183,017) 153,626,515 Balances as ofDecember31, 2024 58,348 - 93,733,964 - 138,989,677 - 374,298 31,250,508 - - 19,161,719 149,573 355,816,259 153,809,532 793,343,878 (222,136) 793,121,742 The accompanying notes are an integral part of these consolidated financial statements. F-9
Page 163
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMACONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY AS OF DECEMBER 31, 2023(figures expressed in thousands of pesos - $ - except as otherwise stated) Owners’ contributions CapitalStock Treasuryshares Capitaladjustments TreasurysharesadjustmentsSharepremium Treasurysharespremium TreasurysharestradingpremiumMergerpremium Cost oftreasuryshares Share-basedpaymentplans LegalreserveEnvironmentalreserve OptionalReserve forFutureDividendsRetainedearnings Shareholders’equityattributableto owners ofparentcompany Non-controllinginterest Total Balances as of January 1,2023 58,358 1,244 93,752,080 1,996,914 139,270,684 33,727,074 93,812 31,250,508 (43,637,162) 775,622 19,161,719 149,573 495,207,603 13,146,795 784,954,824 1,321,153 786,275,977 Share-based payment plans- - - - - - - - - 862,185 - - - - 862,185 - 862,185 Granting of share-basedpayment plans 9 (9) 14,024 (14,024) 236,868 (236,868) 252,077 - 145,063 (397,140) - - - - - - - Appropriation as perAnnual Shareholders’Meeting held April 25,2023: Optional reserve - - - - - - - - - - - - 13,146,795 (13,146,795) - - - Capital reduction (19) (1,235) (32,140) (1,982,890) (517,875) (33,490,206) - - 43,492,099 - - - - (7,467,734) - - - Appropriation as per Boardof Directors’Resolution of May 2,2023: Payment of dividends - - - - - - - - - - - - (105,855,278) - (105,855,278) - (105,855,278) Appropriation as per Boardof Directors’Resolution of June 23,2023: - Payment of dividends - - - - - - - - - - - - (61,656,058) - (61,656,058) - (61,656,058) Net income for the year 22,440,931 22,440,931 (1,360,272) 21,080,659 Balances as of December31, 2023 58,348 - 93,733,964 - 138,989,677 - 345,889 31,250,508 - 1,240,667 19,161,719 149,573 340,843,062 14,973,197 640,746,604 (39,119) 640,707,485 The accompanying notes are an integral part of these consolidated financial statements. F-10
Page 164
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMACONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY AS OF DECEMBER 31, 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Owners contributions CapitalStock Treasuryshares Capitaladjustments Treasurysharesadjustments Sharepremium Treasurysharespremium Treasurysharestradingpremium Mergerpremium Cost oftreasuryshares Share-basedpaymentplans Legalreserve Environmentalreserve OptionalReserve forFutureDividends Retainedearnings Shareholders’equityattributableto owners ofthe parentcompany Non-controllinginterest Total Balances as ofJanuary 1,2022 58,742 860 94,369,076 1,379,918 149,691,364 23,306,394 - 31,250,508 (31,534,532) 526,674 19,161,719 149,573 580,255,344 86,995,833 955,611,473 2,214,922 957,826,395 Acquisition oftreasury stock (389) 389 (625,075) 625,075 (10,557,174)10,557,174 - - (12,189,389) - - - - - (12,189,389) - (12,189,389) Share-basedpaymentplans - - - - - - - - - 429,519 - - - - 429,519 - 429,519 Granting ofshare-basedplans 5 (5) 8,079 (8,079) 136,494 (136,494) 93,812 - 86,759 (180,571) - - - - - - - Appropriation asper AnnualShareholders’Meeting heldApril 14,2022: - Payment ofdividends - - - - - - - - - - - - (55,268,424) - (55,268,424) - (55,268,424) Appropriation asper AnnualShareholders’Meeting heldApril 27,2022: - Optional reserve - - - - - - - - - - - - 86,995,833 (86,995,833) - - - Appropriation asper Board ofDirectors’Resolution ofJuly 1, 2022: - Payment ofdividends - - - - - - - - - - - - (93,040,509) - (93,040,509) - (93,040,509) Appropriation asper Board ofDirectors’Resolution ofDecember27, 2022: - Payment ofdividends - - - - - - - - - - - - (23,734,641) - (23,734,641) - (23,734,641) Net income forthe year - - - - - - - - - - - 13,146,795 13,146,795 (893,769) 12,253,026 Balances as ofDecember31, 2022 58,358 1,244 93,752,080 1,996,914 139,270,684 33,727,074 93,812 31,250,508 (43,637,162) 775,622 19,161,719 149,573 495,207,603 13,146,795 784,954,824 1,321,153 786,275,977 The accompanying notes are an integral part of these consolidated financial statements. F-11
Page 165
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMACONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEARS ENDED AS OF DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 2024 2023 2022 OPERATING ACTIVITIES Net profit for the year 153,626,515 21,080,659 12,253,026 Adjustments to reconcile net profit to net cash generated by operating activities Income tax expense 95,925,288 16,849,960 62,361,904 Depreciation and amortization 62,626,497 70,101,333 90,042,209 Provisions 5,283,126 15,230,440 8,826,526 Exchange rate differences 40,754,969 207,081,777 32,755,517 Loss from securities transactions 544,055 3,998,429 119,594,515 Interest expense 58,265,167 135,474,312 34,623,282 Result from disposal of fixed assets - - 16,419 Share-based payments 682,956 862,185 429,519 Gain on disposal of property, plant and equipment (2,729,788) (981,808) (22,851,318) (Recovery) charge of allowance for other doubtful receivables 889,806 (462,544) 1,312,527 Gain on net monetary position (262,879,515) (302,169,399) (93,223,993) Changes in operating assets and liabilities Inventories (46,088,719) (31,739,941) (21,469,057) Other receivables 22,911,153 (10,437,149) (21,544,995) Trade accounts receivable (39,849,707) (54,539,668) (48,463,058) Advances from customers (1,206,869) 3,274,794 1,633,075 Accounts payable 54,602,995 98,455,813 75,705,817 Salaries and social security contributions 11,782,065 14,681,690 19,095,002 Provisions (1,300,875) (1,463,969) (2,734,295) Tax liabilities (5,380,529) (3,475,541) 36,045,438 Other liabilities (11,245,714) 15,391,521 382,175 Income tax paid (12,494,796) (12,048,026) (72,114,100) Net cash generated by operating activities 124,718,080 185,164,868 212,676,135 INVESTING ACTIVITIES Proceeds from sale of interest in Yguazú Cementos S.A. - 1,414,367 630,859 Proceeds from disposal of property, plant and equipment 1,730,237 1,796,367 22,351,457 Payments to acquire property, plant and equipment (73,047,859) (78,510,673) (69,192,367) Payments to acquire intangibles assets (686,484) (1,458,636) (706,789) Redemption of investments - - 16,242,259 Contributions to FFFSFI (889,806) (1,256,030) (1,312,527) Net cash used in investing activities (72,893,912) (78,014,605) (31,987,108) FINANCING ACTIVITIES Proceeds from borrowings 330,130,588 151,278,075 350,636,704 Issuance of corporate bonds - 310,284,594 - Interest paid (61,590,691) (118,407,456) (32,251,499) Dividends paid - (189,116,296) (147,871,427) Lease payments (1,735,954) (2,092,178) (1,920,608) Repayment of borrowings and corporate bonds (314,475,020) (241,416,164) (324,457,213) Repurchase of capital stock (594,830) - (12,189,389) Net cash used in financing activities (48,265,907) (89,469,425) (168,053,432) Net increase in cash and cash equivalents 3,558,261 17,680,838 12,635,595 Cash and cash equivalents at the beginning of the year 14,664,561 33,302,505 43,666,825 Effect of restating in constant currency of cash and cash equivalents (10,032,840) (50,562,265) (24,546,771) Effects of exchange rate differences on cash and cash equivalents in foreign currency 363,381 14,243,483 1,546,856 Cash and cash equivalents at the end of the year (Note 29) 8,553,363 14,664,561 33,302,505 Note 30 includes non-monetary transactions. The accompanying notes are an integral part of these consolidated financial statements.
Page 166
F-12
Page 167
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 1. LEGAL INFORMATION Legal address: Loma Negra Compañía Industrial Argentina S.A. (hereinafter “Loma Negra”, “the Company” or “the Group”) is a corporation organized under the laws of theArgentine Republic with legal address in Boulevard Cecilia Grierson 355, 4th. Floor, City of Buenos Aires, Argentina . Fiscal year number: Fiscal year No. 100 beginning on January 1, 2024. Principal business of the Company: The Company and its subsidiaries, mentioned below, are referred to in these financial statements as “the Group”. The main activity of the Group is the manufacturing and selling of cement and its derivatives, as well as the extraction of mineral resources that are used in theproduction process. At present, the Group has 8 cement factories in Argentina, in the provinces of Buenos Aires, Neuquén, San Juan and Catamarca. TheCompany also has mobile concrete plants adaptable to customer construction projects at all times. The Group, through its subsidiary Cofesur S.A.U., has a controlling interest in Ferrosur Roca S.A., a company whose capital is owned by Cofesur S.A.U. with80% interest, the National State with a 16% interest, and 4% has been transferred by the latter to the employees through a trust created for such purpose.Ferrosur Roca S.A. operates the railway cargo network of Ferrocarril Roca under a concession granted by the Argentine government in 1993 for a term of 30years, which allows access of several of Loma Negra’s cement production plants to the railway network. As a result of the National Government’s decision toterminate to the existing railway concession system in Argentina and shift to an open access model with the participation of private rail operators, the aboveconcession ended in March 2023. However, the Ministry of Transport subsequently published diverse resolutions provisionally extending for periods between12 and 18 months the concessions granted to the different concessionaires, including Ferrosur Roca S.A. and the respective concession term has been extendedfor the second time until September 2025. The Group has assessed potential business scenarios based on its intention to continue delivering services as a railnetwork operator, as described in Note 36. The Group also controls Recycomb S.A.U., a company engaged in the treatment and recycling of industrial waste for use as fuel or raw material. Date of registration with the Argentinian General Inspection of Justice (local regulatory agency): • Registration of the bylaws: August 5, 1926, under No 38, Book 46. • Last amendment registered to the bylaws: September 26, 2023, under No 16,416, book 114, Corporations Volume. • Correlative Number of Registration with Inspección General de Justicia: 1,914,357. • Tax identification number (CUIT): 30-50053085-1. • Date of expiration: July 3, 2116. Parent company: InterCement Trading e Inversiones Argentina S.L. with 52.1409% of the Company’s capital stock and votes. F-13
Page 168
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Capital structure: The Ordinary and Extraordinary General Shareholders' Meeting, held on April 25, 2023, approved, among other issues,the voluntary reduction of the Company's capital stock for a total of 12,543,339 ordinary shares, which includes12,352,329 shares in portfolio. and 191,010 unnamed shares. Considering the aforementioned, as of December 31, 2024, the subscribed for and paid in capital amounts to $58,348,315.10, represented by 583,483,151 book-entry common shares with a nominal value of $0.10 each, and each entitling to one vote. 2. BASIS OF PREPARATION OF THE CONSOLIDATED FINANCIAL STATEMENTS 2.1 Statement of compliance with the IFRS accounting standards and bases of preparation of these consolidated financial statements The consolidated financial statements of the Group as of December 31, 2024 and 2023 and for the fiscal years ended December 31, 2024, 2023 and 2022 havebeen prepared and presented in accordance with the IFRS Accounting Standards as issued by the International Accounting Standards Board (“IASB”). These consolidated financial statements comprehensively recognize the effects of variations in the purchasing power of currency through the application of themethod to restate the consolidated financial statements in constant currency, as established by the International Accounting Standard 29 (IAS 29). For comparative purposes, these consolidated financial statements include figures and other details corresponding to the fiscal years ended on December 31,2023 and 2022, which are an integral part of the above-mentioned consolidated financial statements and are presented in order for them to be solely interpretedin accordance with the figures and other information for this current fiscal year. These figures have been restated in the current fiscal year’s end-of-periodcurrency in the manner described in the following section in order to allow comparability. These consolidated financial statements were approved by the Board of Directors on April 29, 2025, the date when they were available for issuance. 2.2. Financial information presented in constant currency The consolidated financial statements as of December 31, 2024, and the corresponding figures for prior fiscal years have been restated to consider changes inthe general purchasing power of the Group’s functional currency (the Argentine Peso) in accordance with the provisions included in IAS 29. As a result, theconsolidated financial statements are stated in constant currency as at the end of the current fiscal year. According to IAS 29, the restatement of the financial statements is necessary when the functional currency of an entity is that of a hyperinflationary economy.IAS 29 provides certain guidelines for illustrative purposes to define a situation in which hyperinflation is deemed to arise, including (i) analysis of generalpopulation behavior, prices, interest rate, and salaries in the face of changes in price indexes and the loss of the currency purchasing power and (ii) as aquantitative feature, which is the condition more frequently considered in practice, the existence of a cumulative three-year inflation rate that approximates orexceeds 100%. In order to assess the above-mentioned quantitative condition and also to restate financial statements, the series of indices to be used in the application of IAS29 is determined by FACPCE. These series combines the Consumer Price Index (CPI) at the national level and as published by Instituto Nacional de Estadísticay Censos (Official Statistics Bureau, “INDEC” as per the initials in Spanish) as from January 2017 (baseline month: December 2016) with the WholesaleDomestic Price Index (IPIM, for its acronym in Spanish) as published by INDEC until that date, computing for the months of November and December 2015,for which INDEC has no information with respect to changes in the IPIM, the variation in the CPI of the City of Buenos Aires. F-14
Page 169
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Taking such index into account, inflation was 117.80%, 211.40% and 94.79% in the years ended December 31, 2024, 2023 and 2022, respectively, and morethan 100% accumulated in three years during each of the years presented was reached. Below is a summary of the methods of applying IAS 29. Restatement of the statement of financial position: (i) Monetary items (those with a fixed nominal value in local currency) are not restated because they are already stated at the current unit of measurement as ofthe end of the reporting period. In an inflationary period, holding monetary assets causes losses in the purchasing power and holding monetary liabilitiesgenerates gains in the purchasing power, provided that such items are not subject to an adjustment mechanism that may otherwise offset these effects. Monetarygains or losses are included in the statement of profit or loss and other comprehensive income for every fiscal year. (ii) The assets and liabilities that are subject to changes based on specific agreements are adjusted on the basis of such agreements. (iii) Non-monetary assets and liabilities measured at fair values as of the balance sheet date are not inflation-restated for presentation purposes in the statementof financial position, however, their restated amounts are used to measure the gains or losses caused by holdings of such non-monetary items. For the fiscalyears ended December 31, 2024, 2023 and 2022, the Group did not have non-monetary items measured at fair value. (iv) Non-monetary items measured at historical cost or at the current value of a date prior to the end of the reporting fiscal year are restated by coefficients thatreflect the variations in the general price level since the date of acquisition or revaluation through the end of the reporting period. Subsequently, the restatedamounts of such assets are compared to the corresponding recoverable values at the end of the reporting period. The amounts charged to against the statementof profit or loss and other comprehensive income due to depreciation of property, plant and equipment and amortization of intangible assets, as well as anyother consumption of non-monetary assets shall be determined based on the restated amounts. As of December 31, 2024, 2023 and 2022, the items subject tothis restatement process have been those included in inventories, other receivables, property, plant and equipment, right of use assets and goodwill. (v) When borrowing costs are capitalized in non-monetary assets pursuant to IAS 23, the components of those costs compensating the creditor for the effects ofinflation are not capitalized. (vi) The restatement of non-monetary assets in terms of current units of measurement as of the end of the year with no equivalent adjustment for tax purposesgives rise to a taxable temporary difference and the recognition of deferred tax liabilities against to profit or loss for the year. In those cases where there is arevaluation of the non-monetary assets in addition to the restatement, the deferred tax recognized on the restatement is accounted for as profit or loss for theyear, and the effect of deferred taxes on the revaluation (excess of the revalued amount over the restated amount) is recognized in other comprehensive income.The Group has no revaluated assets. Restatement of the statement of profit or loss and other comprehensive income: (i) Expenses and revenues are restated as from the date they are accrued, except for those profit or loss items related to the consumption of assets measured inpurchasing power currency of a date previous to the recording of such consumption which are restated based on the inception date of the asset to which theitems are related (such as depreciation, impairment, and other use of assets valued at historical cost); and except also for any profit or loss arising fromcomparing two measurements expressed in a currency with a purchasing power from different dates, for which it is necessary to identify the amounts compared,their separate restatement and their comparison based on the new restated amounts. (ii) Net profit or loss on exposure of monetary assets and liabilities to inflation is reported in a separate item of profit and loss , which reflects profit or loss onthe exposure to changes in the purchasing power of the currency (“RECPAM” for the Spanish initials of "Resultado por el Cambio en el Poder Adquisitivo de laMoneda"). Restatement of the statement of changes in shareholders’ equity: All equity components' beginning balances are restated by applying the general price index from the beginning of the fiscal year, and the movements of eachsuch components during the year are restated as from the date of the contribution or initial F-15
Page 170
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) recognition. Capital stock is presented at nominal values and its corresponding restatement adjustment is presented in the "capital adjustment” account. Othercomprehensive income resulting after the transition date of the implementation of IAS 29 is recorded net of the inflation effect. Restatement of the statement of cash flows: IAS 29 requires that all entries in this statement should be restated in terms of the unit of measurement that is current at the end of the reporting period. Themonetary gain or loss generated from cash and cash equivalents is presented in the statement of cash flows separately from the cash flows from operating,investing and financing activities, as a specific item for the reconciliation between cash and cash equivalents at the beginning and at the end of the fiscal year. 2.3. Applicable accounting standards The consolidated financial statements have been prepared on a historical cost basis, which has been restated at year-end currency in the case of non-monetaryitems, except for the revaluation of certain financial assets, which are measured at the fair value at the closing date of each fiscal year. In general, historical costis based on the fair value of the consideration given in exchange for the assets. Fair value is the price that the Group would receive to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of themeasurement date, irrespective of whether such price is directly observable or estimated using another valuation technique. The fair value of an asset or aliability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in theireconomic best interest. Fair value is determined on the basis previously mentioned, except for share-based payment transactions that are within the scope of IFRS 2, lease transactions,within the scope of IFRS 16 and measurements that have some similarities to fair value but are not fair value, such as net realizable value in IAS 2 or value inuse in IAS 36. All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described asfollows, based on the lowest level input that is significant to the fair value measurement as a whole: • Level 1 quoted (unadjusted) prices in active markets for identical assets and liabilities to which the entity has access as at the measurement date; • Level 2 valuation techniques for which the lowest level input that is significant to their value measurement is directly or indirectly observable; and • Level 3 valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable. Classification as current and non-current: The Group classifies assets and liabilities in the consolidated statement of financial position as current and non-current. An asset is classified as current when the Group: a) expects to realize the asset or intends to sell or consume it during its normal operating cycle; b) holds the asset primarily for the purpose of trading; c) expects to realize the asset within twelve months after the end of the reporting period; or d) the asset is cash or cash equivalent unless it is restricted and cannot be exchanged or used to settle a liability for at least twelve months after the end ofthe reporting period. All other assets are classified as non-current. F-16
Page 171
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) A liability is classified as current when the Group: a) expects to settle the liability during its normal operating cycle; b) holds the liability primarily for the purpose of trading; c) the liability is due to be settled within twelve months after the end of the reporting period; or d) fails to have an unconditional right to defer settlement of the liability for at least twelve months after the end of the reporting period. All the other liabilities are classified as non-current. Deferred tax assets and liabilities are classified as non-current assets and liabilities in all cases. Year-end date: The fiscal year of the Group starts on January 1° and ends on December 31 each year. Currency: The consolidated financial statements are presented in thousands of Argentine Pesos ($), the currency of legal tender in the Argentine Republic, and which isthe functional currency of the Group. Amounts are rounded without decimals. Use of estimates: The preparation of consolidated financial statements requires the Group’s management to make judgements, estimates and assumptions that affect the amountof recorded assets and liabilities and the contingent assets and liabilities disclosed as of the reporting date, as well as the revenues and expenses recognizedduring each year. Future profit or loss may differ from the estimates and assessments made as of the date of preparation of these consolidated financialstatements. The description of estimates and significant accounting judgments made by the Group’s Board in the application of accounting policies as well as the areas withgreater degree of complexity requiring further judgment, are disclosed in Note 4. The Group´s material accounting policies are described below. 2.4. Standards and interpretations issued but not yet effective and new improvements or standards adopted The following is a detail of standards and interpretations that are issued but not yet effective up to the date of issuance of the Group’s consolidated financial statements. The Group intends to adopt these standards, if applicable, when they become effective, but in no case will they be adopted earlier. • Lack of exchangeability – Amendments to IAS 21 In August 2023, the IASB issued amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates to specify how an entity should assess whether acurrency is exchangeable and how it should determine a spot exchange rate when exchangeability is lacking. The amendments also require disclosure ofinformation that enables users of its financial statements to understand how the currency not being exchangeable into the other currency affects, or is expectedto affect, the entity’s financial performance, financial position and cash flows. The amendments will be effective for annual reporting periods beginning on or after 1 January 2025. Early adoption is permitted, but will need to be disclosed.When applying the amendments, an entity cannot restate comparative information. F-17
Page 172
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) As of the date of issuance of these financial statements, it has been assessed that there are no impacts arising from the application of this modification, whichwill continue to be monitored as a result of the current exchange regulations in Argentina. • Amendments to IFRS 7 and IFRS 9 In May 2024, the Board issued Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7), which: – Clarifies that a financial liability is derecognised on the “settlement date”, i.e., when the related obligation is discharged, cancelled, expires or the liabilityotherwise qualifies for derecognition. It also introduces an accounting policy option to derecognise financial liabilities that are settled through anelectronic payment system before settlement date if certain conditions are met– Clarifies how to assess the contractual cash flow characteristics of financial assets that include environmental, social and governance (ESG)-linkedfeatures and other similar contingent features– Clarifies the treatment of non-recourse assets and contractually linked instruments– Requires additional disclosures in IFRS 7 for financial assets and liabilities with contractual terms that reference a contingent event (including those thatare ESG-linked), and equity instruments classified at fair value through other comprehensive income. The amendments will be effective for annual reporting periods beginning on or after 1 January 2026. Entities can early adopt the amendments. The amendmentis not expected to have a material impact on the Group’s financial statements. • IFRS 18 Presentation and Disclosure in Financial Statements In April 2024, the IASB issued IFRS 18, which replaces IAS 1 Presentation of Financial Statements. IFRS 18 introduces new requirements for presentationwithin the statement of profit or loss, including specified totals and subtotals. Furthermore, entities are required to classify all income and expenses within thestatement of profit or loss into one of five categories: operating, investing, financing, income taxes and discontinued operations. It also requires disclosure of newly defined management-defined performance measures, subtotals of income and expenses, and includes new requirements foraggregation and disaggregation of financial information based on the identified ‘roles’ of the primary financial statements and the notes. In addition, narrow-scope amendments have been made to IAS 7 Statement of Cash Flows, which include changing the starting point for determining cashflows from operations under the indirect method, from ‘profit or loss’ to ‘operating profit or loss’ and removing the optionality around classification of cashflows from dividends and interest. In addition, there are consequential amendments to several other standards. IFRS 18, and the amendments to the other standards, is effective for reporting periods beginning on or after 1 January 2027, but earlier application is permittedand must be disclosed. IFRS 18 will apply retrospectively. The Group is currently working to identify all impacts the amendments will have on the primary financial statements and notes to the financial statements. • IFRS 19 Subsidiaries without Public Accountability: Disclosures In May 2024, the IASB issued IFRS 19, which allows eligible entities to elect to apply its reduced disclosure requirements while still applying the recognition,measurement and presentation requirements in other IFRS accounting standards. To be eligible, at the end of the reporting period, an entity must be a subsidiaryas defined in IFRS 10, cannot have public accountability and must have a parent (ultimate or intermediate) that prepares consolidated financial statements,available for public use, which comply with IFRS accounting standards. IFRS 19 will become effective for reporting periods beginning on or after 1 January 2027, with early application permitted. F-18
Page 173
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) As the Group’s equity instruments are publicly traded, it is not eligible to elect to apply IFRS 19. Adoption of improvements or new standards The Group has adopted all the improvements and new standards and interpretations issued by the IASB that are relevant to its operations and that are effectivefor the fiscal year ended December 31, 2024. As from January 1, 2024, these are the new standards or improvements that become effective: • IAS 1 Classification of Liabilities as Current or Non-Current In January 2020, the IASB issued amendments to IAS 1 “Presentation of Financial Statements” to specify the requirements for the classification of liabilities ascurrent or non-current. The amendments clarify: (i) what is meant by a right to defer settlement; (ii) that a right to defer must exist at the end of the reportingperiod; (iii) that classification is unaffected by the likelihood that an entity will exercise its deferral right; and (iv) that only if an embedded derivative in aconvertible liability is itself an equity instrument would the terms of a liability not impact its classification. These amendments had not impact on the Group´sconsolidated financial statements. • Lease Liability in a Sale and Leaseback – Amendments to IFRS 16 The amendment to IFRS 16 Leases specifies the requirements that a seller-lessee uses in measuring the lease liability arising in a sale and leaseback transaction,to ensure the seller-lessee does not recognize any amount of the gain or loss that relates to the right of use it retains. The amendments had not impact on the Group's consolidated financial statements. • Disclosures: Supplier Finance Arrangements - Amendments to IAS 7 and IFRS 7 In May 2023, the Board issued amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures. The amendments specifydisclosure requirements to enhance the current requirements, which are intended to assist users of financial statements in understanding the effects of supplierfinance arrangements on an entity’s liabilities, cash flows and exposure to liquidity risk. Considering the Group's business practice in recent years, thismodification had not impact on the Group's consolidated financial statements. 2.5. Basis of consolidation These consolidated financial statements include the financial statements of the Company and the companies controlled by the Group. The Group controls anentity when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its powerover the investee. The Group will re-assess whether or not it controls an investee when facts and circumstances indicate changes in one or more of the control elements listed inthe preceding paragraph. Generally, there is a presumption that the majority of voting rights results in control. To support this presumption and when the Group has less than a majorityof the voting or similar rights of an investee, the Group considers all the relevant facts and circumstances in assessing whether it has power over the investee,including: • The Group’s voting right ownership percentage vis-à-vis the size and dispersion of the percentages held by other shareholders voting rights and potentialvoting rights; • Potential voting rights held by the Group, other shareholders or other parties; • Rights arising from contractual arrangements; and • Any and all additional events or circumstances that indicate that the Group has, or fails to have, the current ability to direct the relevant activities of theinvestee when decisions need to be made, including voting patterns at previous shareholders’ meetings. F-19
Page 174
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control over the subsidiary.Specifically, the revenues and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated statement of profit or loss andother comprehensive income since the date on which the Group obtains control until the date on which the Group ceases to control the subsidiary. Profits or losses of each component of other comprehensive income are attributed to the Group´s owners and to the non-controlling interests. The totalcomprehensive income of the subsidiaries is attributed to the Group’s owners and to the non-controlling interests, even if this results in the non-controllinginterests having a deficit balance. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies in line with the Group’s accounting policies. All intra-group assets, liabilities, equity, income, expenses and cash flows related to transactions between members of the Group are eliminated in full uponconsolidation. If the Group loses control over a subsidiary, it derecognizes the related assets (including goodwill), liabilities, non-controlling interest and other components ofequity, while any resultant gain or loss is recognized in profit or loss. Any investment retained is recognized at fair value. The consolidated information disclosed in these consolidated financial statements includes the following subsidiaries: Subsidiary Main business Country % of direct and indirect interest as of December 31,2024 December 31,2023 December 31,2022 Cofesur S.A.U. Investment Argentina 100.00 100.00 100.00 Ferrosur Roca S.A. (1) Rail freighttransportation Argentina 80.00 80.00 80.00 Recycomb S.A.U. Waste recycling Argentina 100.00 100.00 100.00 (1) Directly controlled by Cofesur S.A.U. Below is a summary of the financial information for Ferrosur Roca S.A., a subsidiary in which shareholders outside the Group have a material non-controllinginterest. 2024 2023 Current assets 12,736,823 14,007,691 Non-current assets 11,916,581 13,106,205 Current liabilities 17,173,196 16,057,162 Non-current liabilities 2,558,802 5,047,386 Shareholders’ equity attributable to owners of the parent company 3,937,125 4,807,478 Non-controlling interest 984,281 1,201,870 F-20
Page 175
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 2024 2023 2022 Revenues 64,903,723 72,440,103 79,232,059 Financial results, net 200,810 (2,270,201) 1,550,793 Depreciation (5,789,373) (6,020,708) (18,285,235) Income tax 2,230,356 (1,204,181) 3,161,991 Net losses for the year (784,195) (10,333,299) (11,537,955) 2024 2023 2022 Net cash generated by (used in) operating activities 5,777,249 (4,318,912) (610,350) Net cash (used in) generated by investing activities (5,574,592) 7,251,154 (6,129,617) Net cash generated by (used in) financing activities 469,830 (2,642,954) 7,387,093 Effects of the exchange rate differences on cash and cash equivalents in foreign currency (436,689) (497,503) (381,899) 3. MATERIAL ACCOUNTING POLICIES 3.1. Revenue recognition The Group is engaged in the production and distribution of cement, masonry cement, concrete, limestone and aggregates, operates a railway concession toprovide transportation services and it is also engaged in the industrial waste recycling business. The goods to be delivered and the services to be provided arisefrom agreements with commercial substance (in general, they are not written) where the Group may identify the right of each one of the parties and thepayment terms. 3.1.1. Sale of goods Revenues from sales of goods are recognized when control over goods is transferred to the customer for an amount that reflects the consideration that the Groupexpects to be entitled to in exchange for such assets. The customer obtains control of the goods when significant risks and rewards of the products sold aretransferred in accordance with the specific delivery terms agreed with the customer. Revenues from the sale of goods are measured at fair value of theconsideration received or to be collected, net of commercial discounts. No financing components are considered in the transaction since credit terms varygreatly between 20 and 35 days, depending on the specific terms agreed upon by the Group, which is consistent with market practices. Some agreements with customers offer commercial discounts or volume-based discounts. If revenues cannot be reliably measured, the Group defers revenuerecognition until the uncertainty is resolved. However, due to the fact that performance obligations relate mainly to the delivery of the acquired goods, and thatboth the price and any discount granted are specifically agreed between the parties, there are in practice no uncertainties associated with revenue recognitionfrom sales of goods. Variable consideration is recognized when there is a high likelihood that there will not be a significant reversal in the amount of theaccumulated revenues recognized in the agreement and is measured using the expected value or the most likely amount method, whichever allows to make abetter prediction of the amount based on the terms and conditions of the agreement. The products sold by the Group are generally not returned by customers once they have approved their quality, which occurs at the time of reception. 3.1.2. Services rendered The Group provides transportation services along with the sale of cement, concrete, limestone, and aggregates. Revenues from transportation services arerecognized at the time services are provided, which is usually when revenues from the sale of the transported good are recognized as transportation distance andtime is very short. Revenue is measured on the basis of the consideration defined in the contract with customers. F-21
Page 176
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Revenues from freight railway services and waste recycling services are recognized at the time such services are rendered. 3.2. Goodwill The goodwill was recorded by the Group due to the acquisition of Recycomb S.A.U. and is measured at cost restated in constant currency at the end of thereporting period, as mentioned in Note 2.2. In accordance with IFRS 3, Business Combinations, goodwill is initially measured at cost being the excess of the aggregate of the consideration transferred andthe amount recognized for non-controlling interests and any previous interest held over the fair value of the net identifiable assets acquired and liabilitiesassumed. Goodwill is not amortized, but rather tested for impairment on an annual basis. For impairment testing purposes, goodwill is allocated to each of the Group’scash-generating units that are expected to benefit from the synergies of the relevant combination. Cash-generating units to which goodwill is allocated aretested for impairment on an annual basis, or more frequently if there are indications that the unit may have been impaired. An asset’s recoverable amount is the higher of an asset’s or CGU’s fair value less costs of disposal and its value in use. When the recoverable amount of theCGU is less than its carrying amount, an impairment loss is recognized reducing first the carrying amount of goodwill allocated to the CGU and then,proportionally, the other CGU’s assets. Impairment losses related to goodwill cannot be reversed in future periods. Any goodwill impairment loss is recognized directly in profit or loss. Upon disposal of a cash generating unit to which goodwill has been allocated, such goodwill is included in the determination of the profit or loss on suchdisposal. As of December 31, 2024, 2023 and 2022, the Group has not recognized any goodwill impairment loss. 3.3. Investments in other companies These are investments in which the Group has no significant influence. As these investments do not have a quoted market price in an active market and theirfair value cannot be reliably measured, these investments are measured at cost restated at the end of the reporting period, less any impairment losses identifiedat the end of each reporting period. 3.4. Leases Group as Lessee: The accounting model for the recognition and measurement of all leases is as follows: Right-of-use assets: The Group recognizes a right of use asset at the beginning of each lease (the date on which the underlying asset is available for use). Right-of-use assets aremeasured at cost, net of accumulated depreciation and impairment losses, and adjusted to reflect any remeasurement of liabilities and to recognize changes inthe currency purchasing power. The cost of the right-of-use assets includes the amount of the recognized lease liabilities, initial direct costs incurred, and leasepayments made at or before the lease start date, less any incentives received. Unless the Group is certain that it will acquire the asset at the end of the lease,right-of-use assets are depreciated on a straight-line basis over the shorter of their estimated useful lives and the lease term (calculated based on the term of therelevant agreements, including renewal provisions in the event that they are highly likely to continue). Right-of-use assets are subject to impairment. The Group applies the short-term lease recognition exception (i.e., those leases that have a lease term of 12 months or less from the inception date and do notcontain a purchase option). The Group also applies the recognition exception to leases F-22
Page 177
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) that are considered to be of low value. Payments under these leases are recognized as expense on a straight-line basis over the lease term. Lease liabilities: Lease liabilities are measured at the present value of future lease payments to be made throughout the lease term, for which market rates have been usedaccording to the nature and term of each agreement. Lease payments include fixed payments, less any lease incentives to be received, variable paymentsdepending on an index or rate and amounts expected to be paid under residual value guarantees. Lease payments also include the exercise price of any purchaseoption of the leased underlying asset, and any penalties for terminating the lease, provided that it is reasonably likely that the Group will exercise such options.Variable payments that do not depend on an index or rate are recognized in profit or loss for the year of occurrence of the condition to which they are subject. The unwinding of the present value recognized for each lease is accounted by the Group in the comprehensive income of each year. Group as Lessor: The income from the operating lease of buildings and equipment is recognized every month during the lease term. Leases in which the Group does not transfersubstantially all the risks and rewards inherent in the ownership of the asset are classified as operating leases. The initial direct costs incurred in negotiating anoperating lease are in addition to the carrying amount of the leased asset and are recognized throughout the lease term on the same basis as lease income. 3.5. Foreign currency and functional currency The consolidated financial statements are presented in Argentine Pesos (Argentina’s currency of legal tender), which is also the functional currency (thecurrency of the primary economic environment where the entity operates) for all the Group companies, and the reporting currency of the consolidated financialstatements. For the purposes of presenting these consolidated financial statements, the assets and liabilities in foreign currency held by the Group are translated toArgentine pesos at the foreign exchange rate prevailing at the end of each fiscal year. Any exchange gain or loss from monetary items is recognized in the profit or loss for the year, restated at year-end currency, except for those arising fromforeign currency borrowings related to financing qualifying assets, such as assets under construction for future productive use, which were included in the costof such assets for being considered as an adjustment to the cost of interest accrued on such foreign currency denominated borrowings. 3.6. Borrowing costs Borrowing costs, net of the effect of inflation directly attributed to the acquisition, construction or production of qualifying assets, which are assets that take asubstantial period of time to get ready for their intended use or sale, are capitalized as part of the cost of the asset until the assets are ready for use or sale. Income earned on short term investments of specific outstanding borrowings to finance the construction of qualifying assets is deducted from the borrowingcosts that may qualify for capitalization. All the other borrowing costs are recognized in profit or loss during the fiscal year in which they are incurred, net of the effect of inflation on the liabilities thatgenerated them. The Group has not capitalized interest or exchange differences in the fiscal year ended December 31, 2023 and 2022, respectively. F-23
Page 178
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 3.7. Taxation 3.7.1. Income tax The Group assesses the income tax to be recorded in accordance with the deferred tax method, which considers the effect of temporary differences arising fromthe different bases for the measurement of assets and liabilities according to accounting and taxing criteria, and of existing tax losses and unused tax creditsdeductible from future taxable income, computed by considering the tax rate in force. Law No. 27,260, which was enacted on June 16, 2021, introduced amendments to the corporate tax rate by setting a staggered structure of applicable ratesbased on the level of accumulated net taxable income for each company, which may be 25%, 30%, or 35%; the 7% tax on the distribution of dividends,however, has remained unchanged. 3.7.1.1. Current taxes Current tax payable is based on the taxable profit for the fiscal year. Taxable profit differs from profit before tax as reported in the consolidated statement ofprofit and loss and other comprehensive income because of items of income, or expenses that are taxable or deductible in other years and items that will neverbe taxable or deductible. The Group’s liability for current tax is calculated using the tax rates that have been substantially enacted at the end of the reportingperiod, considering the tax loss carryforward at their respective amounts adjusted for inflation according to the mechanisms provided in Article No. 25 of theArgentine Income Tax Law. 3.7.1.2. Deferred tax Deferred tax is recognized on the temporary differences between the carrying amount of the assets and liabilities included in the consolidated financialstatements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all future taxabletemporary differences. Deferred tax assets are recognized for all deductible temporary differences to the extent that the Group is likely to have future tax profitagainst which it is possible to account for those deductible temporary differences. Such deferred tax assets and liabilities are not recognized when temporarydifference arose from goodwill or the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neitherthe taxable nor the accounting profit and does not give rise to equal taxable and deductible temporary differences. The carrying amounts of deferred tax assets are reviewed at the end of each fiscal year and derecognized to the extent it is no longer probable that sufficienttaxable profit will be available to allow all or part of the asset to be recovered. Deferred tax assets and liabilities are measured using the tax rates that are expected to apply in the fiscal year when the asset is realized or the liability is settled,based on tax rates (and tax laws) that have been enacted or substantially enacted at the end of the reporting period. Measurement of deferred tax assets andliabilities at the end of the reporting period reflects the tax consequences that would stem from the manner in which the entity expects to recover or settle thecarrying amount of its assets and liabilities. The Group offsets deferred tax assets and deferred tax liabilities only if (a) it has enforceable right to set off current taxes and current liabilities and (b) thedeferred tax assets and liabilities relate to income taxes levied by the same tax authority on either the same taxable entity or different taxable entities and theGroup intends either to settle current tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future periodin which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered. Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates, except where the Group isable to control the reversal of the temporary difference and it is probable that temporary differences will not reverse in the foreseeable future. Deferred taxassets arising from deductible temporary differences associated with such investments are recognized only to the extent it is probable that there will besufficient taxable profit to use the benefits of temporary differences and they are expected to reverse in the foreseeable future. F-24
Page 179
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 3.7.1.3. Current tax charge and deferred taxes profit or loss Current and deferred taxes are recognized in the statement of profit or loss and other comprehensive income, except when they relate to items that arerecognized in other comprehensive income or directly in shareholders’ equity, in which case the current and deferred taxes are also recognized in othercomprehensive income or directly in shareholders’ equity, respectively. When the current tax or deferred tax arises from the initial accounting of a businesscombination, the tax effect is included in the accounting for the business combination. 3.7.2. Personal assets tax – Substitute taxpayer In Argentina, individuals and foreign entities, as well as their undistributed estates, regardless of whether they are domiciled or located in Argentina or abroadare subject to personal property tax at the rate of 0.50% over the value of any shares or the American Depositary Shares (ADSs) issued by Argentine entitiesheld as of December 31 of each year. The tax is applied to the Argentine issuers of such shares, who must pay this tax on behalf of the relevant shareholders and is based on the value of the shares(following the equity method), or the book value of the shares derived from the most recent financial statements as of December 31 of each year. In accordancewith the Personal Assests Tax Law, the Group has the right to obtain a reimbursement of the tax paid from the shareholders to whom the above tax is applicable,through the reimbursement procedure deemed appropriate by the Group. 3.8. Property, plant and equipment Property, plant and equipment held for use in the production or supply of goods and services, or for administrative purposes, are carried at the cost restated inconstant currency at the end of the reporting period, in accordance with Note 2.2, less accumulated depreciation and impairment loss. The cost includes the stripping and initial preparation of the open pit quarries, as mentioned in Note 3.18, and the counterpart for the environmental restorationand/or dismantling obligations recognized, as indicated in Note 3.12. It also includes borrowing costs for long-term construction projects if the recognitioncriteria are met. When significant parts of plant and equipment are required to be replaced at intervals, the Group depreciates them separately based on their specific usefullives. Likewise, when a major inspection is performed, its cost is recognized in the carrying amount of the plant and equipment as a replacement if therecognition criteria are satisfied. All other repair and maintenance costs are recognized in profit or loss as incurred. The lands owned by the Group are not subject to depreciation. Construction in progress for administrative, production, supply or other purposes are carried at cost restated in constant currency at the end of the reportingperiod, in accordance with Note 2.2, less any recognized impairment loss. Depreciation of Property, Plant and Equipment commences when such assets are ready for their intended use. Property, plant and equipment are depreciated, except for land and assets under construction, over their estimated useful lives using the straight-line method.The estimated useful life, the residual value and the depreciation method are reviewed at the end of each fiscal year, with the effect of any changes in estimatesbeing accounted for on a prospective basis. Gain or loss from the disposal or write-off of an item of property, plant and equipment is calculated as the difference between net disposal proceeds and thecarrying amount of the asset and is recognized in profit or loss at its value restated at the year-end currency. The Group assesses the recoverability of the value of its property, plant and equipment items whenever any indication of impairment is identified. Theassessments are carried out considering the cash-generating units established by the Group. F-25
Page 180
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 3.9. Intangible assets Intangible assets with finite useful lives that were separately acquired are carried at cost restated in constant currency at the end of the reporting period, asdescribed in Note 2.2, less accumulated depreciation and impairment losses. The estimated useful life and depreciation method are reviewed at the end of each fiscal year, with the effect of any changes in estimates being accounted for ona prospective basis. Intangible assets with indefinite useful lives that were separately acquired are carried at the cost restated in constant currency at the end ofthe reporting period, as described in Note 2.2, less accumulated impairment losses. Intangible assets are derecognized when no future economic benefits are expected from their use or disposal. Gains or losses from a derecognized intangibleasset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognized in profit or loss when the asset isderecognized. 3.10. Impairment of tangible and intangible assets At the end of each period, the Group reviews if any indication that tangible and intangible assets might be impaired. In case of impairment indicators are observed, the Group calculates the recoverable amount per cash-generating unit. The recoverable amount of an asset is thehigher of the fair value less cost of disposal and its value in use. In assessing value in use, the estimated future cash flows are discounted using a pre-taxdiscount rate that reflects current market assessments as of year-end with respect to the time value of money considering the risks that are specific to the asset.Cash-generating units are mentioned in Note 13. If the recoverable value of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying value of the asset (or cash-generatingunit) is reduced to its recoverable value. Impairment losses are immediately recognized in profit or loss. When a recognized impairment loss is subsequently reversed, the book value of the asset is increased up to the new recoverable amount but the reversal islimited so that the carrying amount of the asset does not exceed the carrying amount that would have been determined, net of depreciation, had no impairmentloss been recognized for the asset or CGU in prior years. Impairment loss reversals are immediately recognized in profit loss. Impairment losses related togoodwill are not reversed in future periods. 3.11. Inventories Inventories are stated at the lower of cost restated in constant currency at the end of the reporting period in accordance with Note 2.2 and net realizable value. Costs incurred in bringing products to their present condition are accounted for as follows: • Raw materials and spare parts: at acquisition cost according to the Weighted Average Price method. • Finished goods and work in progress: at acquisition cost of raw materials and labor, plus a proportion of manufacturing overheads based on normaloperating capacity. The net realizable value of an inventory component is the estimated selling price for that component in the ordinary course of business, less estimated costs ofcompletion and estimated costs necessary to make the sale, calculated as of the end of the reporting period. In assessing recoverable amounts, slow-movinginventories are also considered. The carrying amount of inventories as of the fiscal year-end does not exceed their recoverable value. F-26
Page 181
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 3.12. Provisions Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resourcesembodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Estimated amounts of the obligation are based on the expected outflows that will be required to settle such obligation. If the effect of the time value of money ismaterial, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When the Group expects some or all of a provision to be reimbursed, the reimbursement is recognized as a separate asset (a receivable), but only when thereimbursement is virtually certain and the amount of the receivable can be reliably measured. The Group uses the opinion of its legal advisors to determine if a provision should be recorded as well as to estimate the amounts of the obligations. Environmental restoration and asset decommissioning obligations: Under legal provisions and best practices, and the environmental commitments assumed by the Group, land used by the Group for mining and quarrying issubject to environmental restoration, and the fixed assets used in production will be removed at the end of operations. In this context, provisions are recognized, as long as they are determinable, in order to afford the estimated expenses for environmental recovery and restorationof the mining areas and the retirement of the corresponding productive assets. These provisions are recorded simultaneously with the increase in value in theunderlying asset and the relevant depreciation of the assets involved is recognized in profit and loss prospectively. The liability recorded is increased due to the unwinding of the discount and this change is charged to net profit or loss. The environmental restoration and assetretirement obligation can also increase or decrease due to changes in the estimated timing of cash flows, changes in the discount rate and/or changes in theoriginal estimated undiscounted costs. In estimating the expected cost, the Group takes into account changes in environmental legislation and regulations, ifany, that may impact the process and restoration and dismantling costs. Increases or decreases in the obligation other than the unwinding of discount will resultin a corresponding change in the carrying amount of the related asset. Actual costs incurred upon settlement of the asset retirement obligation are chargedagainst the asset retirement obligation to the extent of the liability recorded. The Group discounts the costs related to asset retirement obligations using thediscount rate that reflects the current market assessment of the time value of money and risks specific to the liabilities that have not been reflected in the cashflow estimates. Asset retirement obligations are remeasured at each reporting period in order to reflect the discount rates in effect at that time. In addition, the Group follows the practice of progressively restoring the areas by the removal of quarries using the provisions recognized for that purpose. 3.13. Financial instruments A financial instrument arises from any contract that results in the recognition of a financial asset in one entity and a financial liability or equity instrument inanother entity. All financial assets and liabilities are initially measured at fair value. Transaction costs that are attributable to the acquisition or issue of financial assets andfinancial liabilities (other than financial assets and liabilities at fair value through profit or loss) are added or deducted from the fair value of the financial assetsor liabilities on the initial cost of recognition. Transactions costs directly attributable to the acquisition of financial assets or financial liabilities at fair valuethrough profit or loss are recognized immediately in profit or loss. Interest and financial income are recognized to the extent the effective interest rate is accrued. F-27
Page 182
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) In general, the Group receives short-term advances from its customers. Pursuant to the practical expedient of IFRS 15, the Group does not adjust the promisedamount of consideration for the effects of a significant financing component if it expects, at contract inception, that the period between the entity transfers apromised good or service to a customer and when the customer pays for that good or service will be one year or less. The Group does not receive any long-termadvances from its customers. 3.14. Financial assets According to IFRS 9 Financial instruments, the Group classifies its financial assets into two categories because the company has not asset that are designated asfair value through other comprehensive income: • Financial Assets at amortized cost A financial asset is measured at amortized cost if both of the following conditions are met: (i) the asset is held within a business model of the Group whoseobjective is to hold assets in order to collect contractual cash flows; and (ii) the contractual terms of the financial asset give rise on specified dates to cash flowsthat are solely payments of principal and interest on the principal amount outstanding. In addition, for the assets that meet the conditions mentioned above, IFRS 9 contains an option to designate, at initial recognition, a financial asset as measuredat fair value if doing so eliminates or significantly reduces an account mismatch that would otherwise arise from measuring assets or liabilities or recognizingthe gains and losses on them on different bases. The Group has not recognized financial assets at fair value using this option. At the date of the consolidated financial statements, the Group’s financial assets atamortized cost include certain items of cash and cash equivalents and trade and other receivables. • Financial assets at fair value through profit or loss If one of the above two criteria is not met, the financial asset is classified as an asset measured at “fair value through profit or loss”. At the date of these consolidated financial statements, the Group’s financial assets at fair value through profit or loss include mutual funds classified as currentinvestments. Recognition and Measurement: Acquisitions and disposals of financial assets are recognized on the date on which the Group promises to purchase or sell the asset. Financial assets arederecognized when the rights to receive cash flows from such instruments and the risks and benefits related to their ownership have been terminated orassigned. Financial assets at amortized cost are initially recognized at fair value plus transaction costs. These assets accrue interest based on the effective interest ratemethod. Financial assets at fair value through profit or loss are initially recognized at fair value and transaction costs are recognized as expenses in the statement ofprofit or loss and other comprehensive income. They are subsequently measured at fair value. Changes in fair values and gains or losses on the sale of financialassets at fair value through profit or loss are recognized in “Financial results, net” in the statement of profit or loss and other comprehensive income. In general, the Group uses the transaction price to determine the fair value of a financial instrument at initial recognition. In all other cases, the Group onlyrecords a gain or loss at initial recognition if the fair value of the instrument is evidenced by other comparable and observable market transactions for the sameinstrument or is based on a valuation technique incorporating only observable market data. Any gains or losses not recognized at initial recognition of afinancial asset are subsequently recognized only to the extent that they arise from a change in factors (including time) that market participants would consider inestablishing the price. F-28
Page 183
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) The results of debt instruments that are measured at amortized cost and are not designated in a hedging relationship are recognized in the profit or loss and othercomprehensive income statement using the effective interest rate method. The Group reclassifies between categories all investments in debt instruments onlywhen there is a change in the business model used to manage such assets. Financial asset impairment The Group assesses at the end of each period whether there is any objective evidence that a financial asset or group of financial assets measured at amortizedcost is impaired. The impairment is recorded only if there is objective evidence of impairment as the result of one or more events that occurred after the initialrecognition of the asset and that impairment can be reliably estimated. The Group defined a policy to calculate expected credit losses for trade receivables and record the related allowance for debtors’ impairment. The provision isinitially based on the Group’s historical observed default rates and it is complemented by a case by case analysis to identify special circumstances on individualcustomers and/or transactions. This historical percentage should consider the expectations of future credit collectability and therefore the estimated changes inbehavior. Before accepting a new customer, the Group conducts an internal credit analysis to evaluate the potential customer’s credit quality and define itscredit limit. The limits and ratings attributed to the main customers are reviewed at least once a year. Evidence of impairment includes indications that the debtors or a group of debtors are experiencing serious financial difficulties, default or arrears in interest orprincipal payments, the likelihood that they will be declared bankrupt or file for reorganization proceedings, and when such observable data indicates that thereis a decrease in estimated future cash flows. The amount of the impairment is measured as the difference between the carrying amount of the asset and the present value of estimated future cash flows(excluding future credit losses that have not been incurred) discounted at the original effective interest rate of the financial asset. The carrying amount of theasset is written down and the amount of the loss is recognized in the profit or loss and other comprehensive income statement. As a practical measure, theGroup may measure impairment based on the fair value of an instrument using an observable market price. If, in a subsequent period, the impairment amountdecreases and such reduction is related to an event taking place after the original impairment, the reversal of the impairment loss is recognized in theconsolidated statement of profit and loss and other comprehensive income. Offsetting of financial instruments: Financial assets and liabilities are offset whenever there is a legal right to offset such assets and liabilities and there is an intention to settle them on a net basis,or to realize the asset and settle the liability simultaneously. Derecognition of a financial asset A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised (i.e., removed from theGroup’s consolidated statement of financial position) when: • The rights to receive cash flows from the asset have expired, or • The Group has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full withoutmaterial delay to a third party under a ‘pass-through’ arrangement; and either (a) the Group has transferred substantially all the risks and rewards of theasset, or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if, and to what extent,it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Group continues torecognise the transferred asset to the extent of its continuing involvement. In that case, the Group also recognises an associated liability. The transferred assetand the associated liability are measured on a basis that reflects the rights and obligations that the Group has retained. F-29
Page 184
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset andthe maximum amount of consideration that the Group could be required to repay. 3.15. Ferrocarril Roca Management Trust for capital expenditures The interest in the Trust for the Strengthening of the Interurban Rail System (“FFFSFI”) was carried at cost, considering the value of the contributions made,net of trust expenses, plus net financing profit accrued through the end of the fiscal year. The amounts that may not be recovered or applied against futurecapital expenditures have been reduced to their recoverable value by recording an impairment allowance at the end of this fiscal year. The entity is notcontrolled by Ferrosur Roca S.A. (Note 36). 3.16. Financial Liabilities and Equity Instruments i) Classification as debt or equity: Debt and equity instruments are classified as financial liabilities or as equity in accordance with the substance of the contractual agreement and the definitionsof financial liabilities and equity instruments. ii) Equity instruments:An equity instrument consists in a contract evidencing a residual ownership interest over an entity’s net assets after deducting all its liabilities. Equityinstruments issued by an entity of the Group are recognized at the amount of proceeds received, net of direct issuance costs. The repurchase of the Group’s own equity instruments is recognized and deducted directly in equity. No gain or loss is recognized in the profit or loss statementstemming from purchases, sales, issuance or cancellation of the Group’s own equity instruments. Capital Stock Component Accounts Capital Stock and Share Premium:It comprises the contributions committed or made by the shareholders represented by outstanding shares at nominal value. Adjustment to capital: Capital stock accounts were restated by recognizing the effects of changes in the purchasing power of the currency by applying the procedure described in Note2.2. The capital stock account was maintained at nominal value and the adjustment derived from such monetary restatement is disclosed in capital adjustmentaccount. Capital adjustment is not available for distribution in cash or in kind; however, it can be capitalized by issuing additional shares. In addition, theadjustment mentioned above may be used to cover losses for the year, according to the order of absorption of accumulated losses, as explained below in“Retained Earnings”. Merger premium: This reflects the recognition of premiums originated in mergers between the Parent Company and Ecocemento S.A. and Compañía de Servicios a laConstrucción S.A. in the years 2002 and 2010, respectively. Merger premium balances were restated in constant currency at the end of the reporting period byapplying the adjustment procedure described in Note 2.2 based on the respective merger dates. Share-based payment plans: The additions refer to the counterpart of the recognition of share-based payment plans granted to certain members of Group management to be settled withequity instruments, restated in constant currency at the end of the reporting period following the adjustment procedure described in Note 2.2, based on the datesof issuance of the plans. The account balance is debited when the equity instruments are delivered to the related employees, reclassifying the respectiveamounts to owners' contribution. In case that the plans are modified as cash settled, the amounts are reclassified to liability. F-30
Page 185
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Treasury shares trading premium:This trading premium relates to treasury shares delivered to employees under current share-based payment plans and represents the difference between thepurchase value of the shares delivered and the estimated value of the consideration received from the relevant employees. Legal reserve: In accordance with the provisions under Law No. 19,550, the Group must appropriate 5% of income for the year, plus adjustments of previous fiscal years,transfers of other comprehensive income to retained earnings and accumulated losses from previous fiscal years, until it reaches a 20% of the sum of thebalances of “Capital” and “Adjustment to capital” accounts. The Legal reserve has been restated in constant currency at the end of the reporting period asdescribed in Note 2.2, considering the movements taking place each fiscal year. Environmental reserve and future dividends reserve: This corresponds to the reserve created by the Group’s shareholders for future use on environmental matters and dividend distributions, respectively. These tworeserves have been restated in constant currency at the end of the reporting period as described in Note 2.2. considering the movements for each fiscal year. Other comprehensive income: This includes income and losses recognized directly in equity and that will be transferred from equity to the profit or loss statement or accumulated retainedearnings, as defined in IFRS Accounting Standards. Retained earnings: Retained earnings include the accumulated income or losses with no specific allocation, which, if positive, can be distributed by means of a decision of theShareholders’ Meeting, provided that they are not subject to any legal restrictions. It includes profit or loss from previous fiscal years that were not distributed,the amounts transferred from other comprehensive income, and adjustments from previous fiscal years by application of new accounting standards. Retainedearnings are restated in constant currency at the end of the reporting period by applying the adjustment procedure described in Note 2.2, considering themovements taking place each fiscal year. Non-controlling interest: This includes the minority ownership interest not owned by Loma Negra C.I.A.S.A. in the net assets and profit or loss of Ferrosur Roca S.A. (20%). iii) Financial liabilities: Financial liabilities are classified as at fair value through profit or loss or other financial liabilities. The Group does not have financial liabilities that arise fromsupplier finance arrangement. Financial liabilities at fair value through profit or loss: A financial liability at fair value through profit or loss is a financial liability held for trading. Financial liabilities are classified as held for trading if: a) It has been acquired or incurred principally for the purpose of selling or repurchasing it in the near term; or b) At the time of initial recognition, the liabilities are part of a portfolio of financial instruments that are managed by the Group and there is evidence of arecent current pattern of short-term profit; or c) It is a derivative that has not been designated and is not effective as a hedging instrument or financial guarantee. F-31
Page 186
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Financial liabilities at fair value through profit or loss are recorded at fair value, with any gains or losses arising from the remeasurement being recognized inprofit or loss. The net gain or loss recognized in profit or loss includes any interest paid on the financial liability and is included in other financial results. Fairvalue is determined as described in Note 32. Financial liabilities (other than financial liabilities held for trading) or contingent consideration to be paid by an acquirer as a part of a business combinationmay be designated as a liability at fair value through profit and loss upon initial recognition if:• Such designation eliminates or significantly reduces a potential accounting mismatch that would otherwise arise; or • Financial liabilities are part of a group of financial assets or liabilities or both, which is managed and whose performance is assessed on the basis of fairvalue, in accordance with the Group’s documented risk management or investment strategy, and information about the Group is provided internally onthat basis; or • They are part of a contract containing one or more embedded derivatives, and IFRS 9 allows the entire combined contract to be carried at fair valuethrough profit and loss. The Company has no financial liabilities measured at fair value to be presented in the statement of financial position. Other financial liabilities: Other financial liabilities, including borrowings and trade and other payables, are initially recognized at fair value, net of transaction costs. Subsequent to initial recognition, other financial liabilities are then measured at amortized cost using the effective interest rate method, with interest expenserecognized based on actual return. Financial liabilities are classified as current liabilities unless the Group has an unconditional right to defer settlement for more than twelve months after the dateof the financial statements. iv) Financial liabilities in foreign currency: The fair value of financial liabilities in foreign currency is determined in that foreign currency and translated at the exchange rate at the end of each fiscal year.The foreign currency component is part of its profit or loss at fair value. For financial liabilities classified as at fair value through profit or loss, the foreigncurrency component is recognized in profit or loss. For debt instruments denominated in foreign currency classified at amortized cost, gains and losses in foreign currency are determined on the basis of theamortized cost of the liability and recognized in “Exchange rate differences” under the “Financial results net” in the statement of profit or loss and othercomprehensive income. v) Derecognition of financial liabilities: The Group must derecognize financial liabilities if, and only if, the obligations of the Group expire, are settled or satisfied. 3.17. Short- and long-term employee benefits Liabilities are recognized for the benefits accrued in favor of employees with respect to salaries and wages, annual vacations, and leaves of absence due toillness in the period in which the service is rendered in connection with the non-discounted amount of the benefits expected to be paid in exchange for suchservice. Liabilities recognized with respect to other long-term employee benefits (severance payment plans resulting from specific plans for employees leaving theGroup and receiving a compensation payable in installments) are measured at the present value of estimated future cash outflows expected to be paid by theGroup. F-32
Page 187
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) On January 24, 2018, the Company’s Board of Directors approved the implementation of an employee incentive program calculated on the basis of ADSs forthe purpose of attracting and retaining certain high-ranking employees who satisfied certain eligibility criteria, with the goal of aligning their long-term interestswith those of the Company and its shareholders. Under this program, a liability was recorded to reflect the fair value of the obligations resulting from the incentive plan as they are settled in cash. Such fairvalue is determined at the beginning and at the end of the fiscal year through the plan settlement date. To calculate the fair value, the Group uses the Black-Scholes valuation method. Changes in the fair value is recorded as an expense during the vesting period and any changes in the fair value are recognized insalaries, wages and social security contributions within the statement of profit or loss and other comprehensive income and the related liability is recognized innon-current Salaries and social security payables within the statement of financial position. During fiscal year 2021, the Board of Directors, through its meeting held on February 12, 2021, implemented two new employee incentive programs with thesame objective. These programs replaced the one approved by the Board of Directors at its meeting of January 24, 2018, notwithstanding the fact that theannual awards that have already been granted as part of the original program will remain in force. The programs approved in 2021 consist in delivering, to certain employees, shares of the Company’s common stock listed on the Argentine Stock Exchangesand Markets (“BYMA”) and/or on the New York Stock Exchange (“NYSE”) in the form of ADSs, being one of the programs subject to total shareholder return(Total Shareholder Return or “TSR”), and the other to the permanence of the selected employees with the Group. On November 6, 2024, the Board of Directorsapproved to modify the program to include an alternative to settle it in cash, providing flexibility to pay the existing plans of the Program. On December 17, 2024, December 19, 2023, and December 21, 2022 the Company’s Board of Directors approved the issuance of the new plans within theframework of the programs implemented in 2021. Until November 2024, the cost of the share-based payment plans to be settled with equity instruments issued under the existing program was measured at fairvalue at the date of each grant and it is recognized as "Salaries, wages, and social security contributions" in the comprehensive income over the period in whichthe performance and/or service conditions were met, with a corresponding entry to “Share-based payment plans” in shareholders' equity. The accumulatedexpense recognized for these plans at each closing date, and up to the vesting date, reflects the extent to which the vesting period has been met and the Group’sbest estimate of the number of equity instruments that would ultimately remain as vested benefit for the employees. During the years ended December 31, 2024, 2023 and 2022, 65,624, 17,473 and 10,069 American Depositary Receipts (“ADRs”), respectively, were distributeddue to the aforementioned incentive programs. During the month of November 2024, the outstanding balance of the active plans that was maintained in equity was reclassified to liabilities considering that itis the intention of the Group's Management to settle the plans in cash. The liability is measured at fair value at the end of each fiscal year, with a correspondingcharge to comprehensive income statement under the account "Salaries, wages, and social security contributions". After the end of the fiscal year, the Group paid all corresponding amounts in cash, in accordance with the new payment alternative decided. 3.18. Stripping and quarry exploitation costs In the ordinary course of business, the Company undertakes several exploration and evaluation activities in order to search for mineral ore and determine thetechnical and commercial feasibility of the resources identified. Exploration and evaluation activities include research and analysis of historical explorationdata, the compilation of exploration data through geological studies, exploratory drilling and sampling in several areas, the determination of the volume andqualification of the resources identified, among others. F-33
Page 188
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Following the guidelines established by IFRIC 20 Stripping Costs in the Production Phase of a Surface Mine, the costs of stripping and initial preparation ofopen-pit quarries for subsequent exploitation are capitalized as property, plant and equipment, as part of the Company’s open-pit quarry stripping anddevelopment costs, and are subsequently depreciated and charged to the cost of products based on the units extracted, considering to that end the estimation ofreserves available for extraction and existing in the stripped area at all times. The Group periodically revalues the estimate of proven reserves in strippedquarries and prospectively adjusts the effects of any difference in the estimate of tons available for extraction. Due to the frequency in which estimates arereviewed, the risk of significant differences in estimates is reduced. Extraction costs incurred later during the production phase are recognized as part of production costs. Mineral rights acquired in connection with the right to explore existing exploration areas are capitalized and amortized during the term of the right. As soon as alegal right has been acquired to explore, exploration and evaluation costs are expensed as incurred to profit or loss, unless the Company’s Management arrivesat the conclusion that there is a highest likelihood of obtaining future profits; when this is the case, costs are capitalized. In assessing whether the costs satisfythe criteria to be capitalized several information sources are used, including the nature of the assets, the surface area explored and the results of the samplestaken, among others. All capitalized stripping, exploration and evaluation costs are subject to impairment testing. In the case of determining a potential impairment indicator, theCompany carries out an assessment of its recoverability together with the group of related operating assets, which represents the cash-generating unit to whichthe exploration is attributed. 3.19. Events after the reporting period If the Group receives information after the reporting period, but prior to the date of authorisation for issue, about conditions that existed at the end of thereporting period, it will assess whether the information affects the amounts that it recognises in its consolidated financial statements. The Group will adjust theamounts recognised in its financial statements to reflect any adjusting events after the reporting period and update the disclosures that relate to those conditionsin light of the new information. For non-adjusting events after the reporting period, the Group will not change the amounts recognised in its consolidatedfinancial statements, but will disclose the nature of the non-adjusting event and an estimate of its financial effect, or a statement that such an estimate cannot bemade, if applicable. 3.20. Earnings per share (EPS) Basic EPS is calculated by dividing the profit for the year attributable to ordinary equity holders of the parent by the weighted average number of ordinaryshares outstanding during the year. Diluted EPS is calculated by dividing the profit attributable to ordinary equity holders of the parent (after adjusting for interest on the convertible preferenceshares) by the weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would beissued on conversion of all the dilutive potential ordinary shares into ordinary shares. 4. CRITICAL ACCOUNTING JUDGMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY In the application of the Group´s accounting policies described in Note 3, the Group’s management has been required to make judgments, estimates andassumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions arebased on historical experience and other factors considered to be relevant. It should be noted that actual results could differ from those estimates. Underlying estimates and assumptions are continuously reviewed. The effects of revisions to the accounting estimates are recognized in the year in which theestimates are reviewed. F-34
Page 189
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 4.1. Critical judgments in applying accounting policies The following are the critical assumptions, in addition to those involving estimations (Note 4.2), made by Management in the process of applying the Group’saccounting policies and that have the most significant effect on the amounts recognized in the consolidated financial statements. 4.1.1. Ferrosur Roca S.A. concession Management has reviewed the Group’s interest in Ferrosur Roca S.A., taking into account the provisions of IFRIC 12 Service Concession Arrangements, whichprovides guidance on accounting by the operators of public-to-private service concession arrangements. Based on the fact that the grantor neither controls nor regulates which services should be provided by the operator to the infrastructure or to whom it mustprovide them, and at what price, Group Management conclude that Ferrosur Roca S.A. concession is out of the scope of IFRIC 12 and, therefore, the Groupdoes not apply its provisions. Accordingly, the Group has recorded the assets received from the concession and those subsequently acquired under IAS 16 -Property, Plant and Equipment. The concession bidding terms and conditions grant an original term of thirty years (1993-2023) and originally provided for the possibility of an extension forten additional years, which was rejected by the Ministry of Transport for the reasons described in Note 36. The Ministry of Transport provisionally issueddiverse resolutions granted extensions for terms of 12 and 18 months to the concession granted to the different concessionaires, including Ferrosur Roca S.A.Therefore, the concession of Ferrosur Roca S.A. has been extended for second time and will end in September 2025. The Group has evaluated potential business scenarios based on its intention to continue delivering services as a rail network operator and has not anticipatedsignificant associated effects to date. Likewise, it has reassessed all the accounting estimates affected to the end of the current concession, especially thoseassociated with the recoverability of certain non-current assets affected by it. The evaluations carried out by the Group are detailed in Note 36. 4.2. Key assumptions and sources of estimation uncertainty The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period that may have arisk of causing material adjustments to the carrying amounts of assets and liabilities during the next fiscal year. 4.2.1. Property, plant and equipment and intangible assets The following is the estimated useful life for each component of property, plant and equipment and intangible assets: Useful life Fields 50 to 100 years Quarries - Stripping cost Based on estimated tons Buildings 10 to 50 years Machinery 10 to 35 years Furniture and fixtures 5 to 10 years Tools 5 years Software 5 years Transportation and load vehicles 4 to 32 years The assets used in the concession of Ferrosur Roca S.A. are depreciated over the shorter of their estimated useful lives and the remaining concession term,including its extensions. F-35
Page 190
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) An impairment exists when the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, which is the higher of its fair value lesscosts to sell and its value in use. The calculation of fair value less costs to sell is based on available data from binding sales transactions conducted undermarket conditions for similar assets or observable market prices less incremental costs of asset disposal. The calculation of the value in use is based on adiscounted cash flow model. Cash flows are derived from the budget for next year, extrapolated for subsequent years using a growth rate, and do not includerestructuring activities that the Group is not yet committed to or significant future investments that will enhance the performance of the assets of the cash-generating unit being tested. The recoverable amount is sensitive to the discount rate used for the discounted cash flow model, as well as the expected futurecash inflows and the growth rate used for extrapolation purposes, among other factors. These matters are the most relevant in the related estimates. Note 13provides more information on impairment analysis and assumptions used. The Group has considered the impact of potential climate-related matters, including legislation, which may affect the fair value measurement and its value inuse of assets and liabilities in the financial statements. The group has assessed whether its items of property, plant and equipment are exposed to physical risks,such as flooding, water shortages and forest fires, but understands that such risks do not currently exist due to circumstances and conditions of the locationswhere its plants, deposits and quarries are located. Additionally, the Group has assessed that it is not currently affected by transition risks, such as those derivedfrom energy efficiency requirements or reductions in emissions due to possible changes in climate-related legislation and regulations. The objectives that theGroup has voluntarily imposed in relation to these matters are contemplated in its budgets and business plans and do not have a material impact on themeasurements of recoverable values. As described in Notes 3.8 and 3.9, the Group annually assesses the estimated useful lives of tangible and intangible assets, respectively. 4.2.2. Provisions for lawsuits and other contingencies The final settlement cost of complaints and litigation may vary due to estimates based on different interpretations of regulations, opinions and final assessmentsof damages. Therefore, any change in the circumstances related to this type of contingencies may have a significant impact on the amount of the provision forcontingencies recorded. In the normal course of its business, the Group selects tax criteria and accounting positions based on a reasonable interpretation of the current regulations, alsotaking into consideration the opinion of its tax and legal advisors along with evidence available up to the date of issuance of these financial statements.Nevertheless, in the event of situations where the assessment by a third party and the potential occurrence of damage for the Group are uncertain, the Group hasnot recorded a provision as it is has not been required under IFRS Accounting Standards. The Group makes judgments and estimates to assess whether it is necessary to record costs and make provisions for environmental cleanup remediation andasset retirement obligations based on the current information related to expected remediation costs and plans. In the case of environmental provisions, costsmay differ from estimates due to changes in laws and regulations, discovery and analysis of local conditions, as well as changes in cleanup technologies.Therefore, any change in the factors or circumstances related to this type of provisions, as well as any amendment to the rules and regulations may thus have asignificant impact on the provisions recorded in these consolidated financial statements. 4.2.3. Calculation of income tax and deferred income tax assets The proper assessment of income tax expenses depends on several factors, including estimates in the timing and realization of deferred tax assets and thefrequency of income tax payments. In order to measure the effect of deferral on investments in controlled or associated companies, Management has determined the presumption that they will notbe disposed of in the foreseeable future and therefore no deferred income tax has been recorded. F-36
Page 191
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 4.2.4. Management’s accounting estimates and judgments on environmental matters The Group is constantly working on a responsible and sustainable business strategy, committed to improving environmental performance on an ongoing basis,minimizing environmental impact caused by its operations, and providing maximum value for society. To this end, the Group has set various environmental sustainability goals within the medium term (year 2030) and long term (year 2050), aligned with the 2030Agenda Sustainable Development Goals (“SDG”) promoted by the United Nations. The main committed goals are related to maximizing energy efficiency and renewable energy, reducing gas emissions and improving air quality, reducing thecarbon footprint, maximizing water management, streamlining waste management by promoting circular economy, and improving efficiency in the use ofmaterials. In preparing the consolidated financial statements, the Group's Management has considered the potential environmental impact. Therefore, the estimates andjudgments made by the Group's Management primarily involve assumptions related to future regulations and performance of the industry in which the Groupoperates. The effects of changes in the estimates and judgments made may primarily relate to impairment tests on property, plant and equipment, the estimateduseful life of those assets and therefore the related depreciation recognized annually, as well as the recognition of provisions, such as the environmentalprovision to afford the estimated expenses for the environmental recovery and restoration of the mining areas exploited by the Group. 5. REVENUES 2024 2023 2022 Sale of products 1,135,109,226 1,337,142,650 1,367,390,322 - Domestic market 1,134,560,278 1,336,571,124 1,366,996,446 - External customers 548,948 571,526 393,876 Services rendered 29,390,702 32,833,687 40,855,263 Bonuses / Discounts (465,321,242) (450,663,628) (424,054,043) Total 699,178,686 919,312,709 984,191,542 F-37
Page 192
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 6. COST OF SALES 2024 2023 2022 Inventories at the beginning of theyear 215,926,185 181,631,737 155,625,813 Finished products 9,084,587 11,402,098 7,861,807 Products in progress 38,434,508 32,592,130 26,491,052 Raw materials, materials, fuel, andspare parts 168,407,090 137,637,509 121,272,954 Purchases and production expensesfor the year 565,001,748 722,979,706 744,419,225 Inventories at the end of the year (268,730,215) (215,926,185) (181,631,737) Finished products (8,700,699) (9,084,587) (11,402,098) Products in progress (47,441,635) (38,434,508) (32,592,130) Raw materials, materials, fuel, andspare parts (212,587,881) (168,407,090) (137,637,509) Cost of sales 512,197,718 688,685,258 718,413,301 The breakdown of production costs is as follows: 2024 2023 2022 Fees and compensation for services 4,972,420 10,505,274 13,555,209 Salaries, wages, and social security contributions 86,997,550 105,213,821 107,048,984 Transport and traveling expenses 6,332,449 5,896,934 5,269,610 Data processing 299,634 361,264 400,988 Taxes, duties, contributions, and commissions 9,918,429 12,002,010 13,126,665 Depreciation and amortization 63,715,419 69,380,637 88,319,653 Preservation and maintenance costs 58,445,096 62,822,169 61,216,389 Communications 660,012 577,933 659,273 Leases 965,199 1,217,330 1,162,370 Employee benefits 3,722,768 3,442,066 3,200,546 Water, natural gas, and energy services 130,758 201,086 155,991 Freight and tolls 48,313,631 72,047,692 76,655,419 Fuels 65,626,798 110,528,064 113,945,347 Insurance 2,061,369 2,577,922 2,394,048 Packaging 17,979,261 23,062,891 24,932,215 Electric power 39,453,476 52,870,127 62,859,633 Contractors 47,812,588 54,282,914 49,598,774 Canon (concession fee) 352,046 458,571 505,591 Security 3,544,260 3,108,833 3,256,492 Others 8,637,956 8,574,398 9,718,521 Total 469,941,119 599,131,936 637,981,718 F-38
Page 193
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 7. SELLING AND ADMINISTRATIVE EXPENSES 2024 2023 2022 Managers and directors’ compensation fees 4,842,029 6,107,231 6,571,081 Fees and compensation for services 6,093,192 7,211,525 5,600,665 Salaries, wages, and social security contributions 19,150,737 21,047,708 21,272,845 Transport and traveling expenses 1,151,858 1,137,666 1,094,489 Data processing 3,694,884 3,028,695 2,124,998 Advertising expenses 3,952,402 4,633,476 3,939,120 Taxes, duties, contributions, and commissions 15,027,001 18,137,388 20,592,023 Depreciation and amortization 3,998,702 4,387,661 5,493,662 Preservation and maintenance 184,379 259,817 147,152 Communications 306,071 461,283 658,966 Leases 502,311 326,841 265,267 Employee benefits 999,751 1,199,090 641,852 Water, natural gas, and energy services 61,398 40,327 35,173 Freight 8,981,821 10,208,967 12,468,372 Insurance 2,812,232 3,775,939 2,097,560 Allowance for doubtful accounts 76,509 238,671 185,358 Security - - 191,066 Others 1,340,075 1,997,580 1,458,692 Total 73,175,352 84,199,865 84,838,341 8. OTHER GAINS AND LOSSES 2024 2023 2022 Gain on disposal of property, plant and equipment 2,729,788 981,808 22,851,318 Donations (445,313) (601,065) (477,053) Gain over tax credit assignment 211,395 159,891 740,405 Contingencies (1,196,549) (1,858,098) (2,535,431) Leases 996,942 854,007 1,135,670 Service fee from ADS Depositary bank 1,854,671 1,913,829 963,136 Miscellaneous 404,303 548,848 279,641 Total 4,555,237 1,999,220 22,957,686 9. TAX ON DEBITS AND CREDITS TO BANK ACCOUNTS The general tax rate on bank credits and debits is 0.6% for amounts debited and credited in the bank accounts of companies based in Argentina. Regardingcredited and debited amounts, 33% of both items can be computed as payment on account of other taxes. Sixty seven percent (67%) of credits and debits isincluded in this line item in the statement of profit or loss and other comprehensive income. F-39
Page 194
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 10. FINANCIAL RESULTS, NET 2024 2023 2022 Exchange rate differences: Foreign exchange gains 7,226,991 26,723,811 5,661,510 Foreign exchange losses (50,935,535) (281,968,623) (55,972,589) Total (43,708,544) (255,244,812) (50,311,079) Financial income Interest from short-term investments 992,223 10,923,697 10,252,429 Effect of discounts on provisions and liabilities 970,666 1,510,462 776,249 Total 1,962,889 12,434,159 11,028,678 Financial expenses Interest on borrowings (57,806,723) (134,692,708) (38,669,191) Loss from securities transactions (Note 32.4) (544,055) (3,998,429) (119,594,515) Interest on leases (556,625) (781,604) (630,003) Tax interest (35,033) (1,342,121) (1,752,590) Effect of discounts on receivables (8,621,255) (5,154,042) (5,809,357) Others (14,958,828) (13,702,277) (6,900,089) Total (82,522,519) (159,671,181) (173,355,745) 11. INCOME TAX EXPENSES The reconciliation between the income tax charge corresponding to the fiscal years ended December 31, 2024, 2023 and 2022, and the amount that would resultfrom applying the current tax rate on the net income before income tax arising from the comprehensive income statements of each fiscal year is as follows: 2024 2023 2022 Profit before income tax expenses 249,551,803 37,930,619 74,614,930 Income tax rate 35 % 35 % 35 % Income tax at the statutory tax rate (87,343,131) (13,275,717) (26,115,225) Adjustments for calculation of the effective income tax: Recovery of tax losses / Unrecognized tax losses 437,159 2,315,390 (30,412,067) Effects of inflation adjustments for accounting and tax purposes (8,905,680) (6,487,215) (5,600,663) Other non-taxable income or non-deductible expense, net (113,636) 597,582 (233,949) Total income tax (95,925,288) (16,849,960) (62,361,904) Income tax Current (66,450,217) (8,296,615) (27,835,209) Deferred (29,475,071) (8,553,345) (34,526,695) Total (95,925,288) (16,849,960) (62,361,904) F-40
Page 195
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 11.1. The deferred income tax assets and liabilities are as follows: 2024 2023 Assets Tax loss carryforward 3,947,205 22,619,557 Valuation allowance of specific tax loss carryforward (3,947,205) (9,009,633) Leases 3,585 1,098,307 Provisions 3,003,117 4,511,469 Salaries and social security contributions 629,207 669,241 Other liabilities 815,348 736,475 Others 1,198,174 1,233,127 Total deferred tax assets 5,649,431 21,858,543 2024 2023 Liabilities Property, plant and equipment (212,781,772) (219,807,493) Inventories (53,056,632) (32,346,856) Taxes payable (tax inflation adjustment) (213,987) (1,412,761) Borrowings (279,668) (422,741) Others (927,185) (3,434) Total deferred tax liabilities (267,259,244) (253,993,285) Total net deferred tax liabilities (261,609,813) (232,134,742) 11.2. Unrecognized temporary differences on investments and other interests Temporary differences related to investments in subsidiaries and other interests for which no deferred tax assets or liabilities have been recognized since it isnot considered probable that they will be reversed in the foreseeable future, are as follows: 2024 2023 Subsidiaries (2,263,532) (1,622,313) Others (24,258) (24,221) Total (2,287,790) (1,646,534) The Group carries tax losses in relation to which an impairment has been recognized and other unrecognized tax losses for a total of 11,277,729, of which33,353 expires in 2026, 11,007,304 in 2027, 23,007 in 2028, and 214,065 in 2029. F-41
Page 196
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 12. EARNINGS PER SHARE Basic and diluted earnings per share: The earnings and the weighted average number of ordinary shares used in the calculation of basic and diluted earnings per share are as follows: 2024 2023 2022 Profit attributable to the owners of the parent company used in the calculation of basic anddiluted earnings per share 153,809,532 22,440,931 13,146,795 Weighted average number of ordinary shares for the purposes of basic and diluted earningsper share (in thousands of shares) 583,481 583,536 585,317 Basic and diluted earnings per share (in pesos) 263.6068 38.4568 22.4610 13. PROPERTY, PLANT AND EQUIPMENT 2024 2023 Cost 2,707,685,224 2,640,923,667 Accumulated depreciation (1,653,486,784) (1,591,024,446) Total 1,054,198,440 1,049,899,221 Land 13,409,283 13,409,304 Plant and buildings 167,644,965 172,015,595 Machinery, equipment and spare parts 721,142,634 738,783,770 Transportation and load vehicles 16,203,313 14,899,161 Furniture and fixtures 992,082 1,160,335 Fields and quarries 78,716,900 73,510,861 Tools 1,261,854 1,359,818 Construction in process 54,827,409 34,760,377 Total 1,054,198,440 1,049,899,221 Cost Land Buildings Machinery,equipment andspare parts Transportationand loadvehicles Furnitureand fixtures Fields andquarries Tools Works inprocess Total Balance as of January 1, 2023 13,523,335 660,600,429 1,356,334,382 170,427,966 47,419,366 300,435,352 9,346,678 11,207,014 2,569,294,522 Additions 157 1,869,563 - - - 922,654 - 78,050,517 80,842,891 Disposal (114,188) (5,070,582) (2,682,803) (1,344,559) (1,614) - - - (9,213,746) Transfers - 10,290,001 14,155,285 4,085,572 355,120 24,998,156 613,020 (54,497,154) - Balance as of December 31, 2023 13,409,304 667,689,411 1,367,806,864 173,168,979 47,772,872 326,356,162 9,959,698 34,760,377 2,640,923,667 Additions - 1,112,144 - - - 309,724 - 69,068,891 70,490,759 Disposal (21) (369,833) - (2,723,583) - (635,765) - - (3,729,202) Transfers - 6,765,621 18,589,769 6,118,226 216,634 16,915,740 395,869 (49,001,859) - Balance as of December 31, 2024 13,409,283 675,197,343 1,386,396,633 176,563,622 47,989,506 342,945,861 10,355,567 54,827,409 2,707,685,224 F-42
Page 197
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Accumulated depreciation and impairment in value Buildings Machinery,equipment andspare parts Transportationand loadvehicles Furniture andfixtures Fields and quarries Tools Total Balance as of January 1, 2023 (488,152,260) (594,958,499) (154,806,263) (46,169,105) (236,305,403) (8,163,927) (1,528,555,457) Disposal 5,070,582 2,425,860 875,221 1,318 - - 8,372,981 Depreciation (12,592,138) (36,490,455) (4,338,776) (444,750) (16,539,898) (435,953) (70,841,970) Balance as of December 31,2023 (495,673,816) (629,023,094) (158,269,818) (46,612,537) (252,845,301) (8,599,880) (1,591,024,446) Disposal - - 2,604,060 - - - 2,604,060 Depreciation charge (11,878,562) (36,230,905) (4,694,551) (384,887) (11,383,660) (493,833) (65,066,398) Balance as of December 31,2024 (507,552,378) (665,253,999) (160,360,309) (46,997,424) (264,228,961) (9,093,713) (1,653,486,784) 13.1. Impairment of property, plant and equipment The Group tests property, plant and equipment for impairment when circumstances indicate that their carrying value may be impaired. The impairment test conducted by the Group for property, plant and equipment is based on estimates of the recoverable amount per cash-generating unit, whichhas been defined as the higher of fair value less costs to sell and value in use. In assessing the value in use, the estimated future cash flows are discounted usinga discount rate reflecting market assessments as of the end of the period with respect to the time value of money considering the risks that are specific to theassets involved. The calculation of the value in use for all cash-generating units is more sensitive to the following assumptions which, as described below, were considered byGroup Management in the development of the impairment test: volumes, prices, gross margins, levels of operating expenses and capital expenditure in property,plant and equipment and working capital, discount rate, growth rate used to extrapolate cash flows beyond the forecast period, and macroeconomic variablesestimated to be present during the projection horizon including, without limitation, exchange rates, inflation levels, and GDP growth. The Group has also considered a number of other factors in reviewing impairment indicators, such as market capitalization, participation in each of thesegments where it does business, unused installed capacity, industry trends, potential environmental impact, and other factors, together with the increase inproperty, plant and equipment balances due to the application of the restatement in constant currency as a result of applying IAS 29 in relation to those assets. As of December 31, 2024, 2023 and 2022, the Company determined that property, plant and equipment amounts are recoverable for each cash-generating unitwhich are detailed below: (a) cement, masonry cement and lime, (b) concrete, (c) aggregates and (d) rail services. The determination of the recoverable amount of each cash-generating unit is based on a calculation of the value in use of the assets involved using cash flowprojections from the financial budgets approved by Company Management. Projected cash flows have been updated to reflect variations in the demand fortraded products, such as the Argentine macroeconomic variables that have an impact on the Company’s businesses. For the rail services cash-generating unit ithas been also considered the potential impact that may derive from terminating the current concession and continuing in business as a railway operator, asmentioned in Note 36, and the Management estimate about the term for which the Group will provide rail services. The discount rate used in cash flow projections has been calculated in US dollars considering that cash flows have been prepared in that currency and aredetailed below. F-43
Page 198
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) As a result of the analysis carried out, no impairment has been determined for any cash-generating unit as December 31, 2024. 2024 2023 Cash-generating unit Cement, Masonry Cement and Lime 11.42 % 15.45 % Concrete 11.42 % 15.45 % Aggregates 11.42 % 15.45 % Rail Services 12.33 % 16.09 % 14. RIGHT OF USE ASSETS AND LEASE LIABILITIES The Group has entered into lease agreements primarily for the lease of offices and premises. Changes in right of use assets and lease liabilities as ofDecember 31, 2024 and 2023 are as follows: 2024 2023 Lease liabilities: As of the beginning of the year 8,683,029 7,225,911 Additions 290,390 154,795 Financial adjustments 556,625 781,604 Foreign Exchange gain /(losses) 1,084,886 9,302,052 Gain on net monetary position (4,513,220) (6,689,155) Deletions (1,179,113) - Payments (1,735,954) (2,092,178) As of the end of the year 3,186,643 8,683,029 Right of use assets: As of the beginning of the year 5,545,007 7,124,046 Additions 290,390 154,795 Deletions (1,253,208) - Depreciation (1,405,791) (1,733,834) As of the end of the year 3,176,398 5,545,007 15. INTANGIBLE ASSETS 2024 2023 Software 2,897,120 3,452,567 Total 2,897,120 3,452,567 F-44
Page 199
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Software Cost: Balance as of January 1, 2023 16,404,187 Additions 1,458,636 Balance as of December 31, 2023 17,862,823 Additions 686,484 Balance as of December 31, 2024 18,549,307 Accumulated amortization: Balance as of January 1, 2023 (13,217,761) Amortization (1,192,495) Balance as of December 31, 2023 (14,410,256) Amortization (1,241,931) Balance as of December 31, 2024 (15,652,187) 16. INVESTMENTS 2024 2023 Non-Current Investments in other companies: - Cementos del Plata S.A. 69,400 69,400 Total 69,400 69,400 Current Short-term investments: - Government securities in dollars - 3,504,535 - Mutual fund in pesos 514,442 66,422 - Short-term investments in foreign currency 64,024 153,601 Total 578,466 3,724,558 Short-term investments in pesos accrue interest at an annual nominal rate of approximately 30.99% and 89.82% as of December 31, 2024 and 2023,respectively. Short-term investments in foreign currency accrue interest at an annual nominal rate of approximately 0.19% and 0.72% as of December 31, 2024and 2023, respectively. Short-term investments are held for investment purposes and are made for variable periods ranging from one day to three months, according to the Group’sfunding needs. 17. GOODWILL 2024 2023 Recycomb S.A.U. 692,222 692,222 Total 692,222 692,222 F-45
Page 200
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 18. INVENTORIES 2024 2023 Non-Current Spare Parts 68,174,820 50,391,995 Allowance for obsolete inventories (1,208,312) (1,023,874) Total 66,966,508 49,368,121 Current Finished products 8,700,699 9,084,587 Production in progress 47,441,635 38,434,508 Raw materials, materials and spare parts 125,408,159 97,874,741 Fuels 20,213,214 21,164,228 Total 201,763,707 166,558,064 19. PARENT COMPANY, OTHER SHAREHOLDERS, ASSOCIATES AND OTHER RELATED PARTIES BALANCES AND TRANSACTIONS The balances between the Group and related parties as of December 31, 2024 and 2023 are as follows: 2024 2023 Related parties: InterCement Brasil S.A. Accounts payable (171,275) (307,294) InterCement Trading e Inversiones S.A. Other receivables 2,163,306 3,688,455 Accounts payable (944,321) (1,694,215) Intercement Participações S.A. Other receivables 2,600,140 4,283,857 Accounts payable (2,269,292) (4,644,204) Total Group's balances per item with other related parties as of December 31, 2024 and 2023 are as follows: 2024 2023 Other receivables 4,763,446 7,972,312 Accounts payable (3,384,888) (6,645,713) F-46
Page 201
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) The transactions between the Group and other related parties during the fiscal years ended December 31, 2024, 2023, and 2022 respectively, are detailed below.These transactions are made on terms equivalent to those that prevail in arm's length transactions: 2024 2023 2022 Intercement Participações S.A. - services provided 125,689 324,078 518,820 Intercement Participações S.A. - services received - (5,957,091) (9,391,627) InterCement Trading e Inversiones Argentina S.A. - distribution of dividends - (87,342,025) (89,447,790) On May 2, 2023, the Board of Directors of the Company resolved to partially cancel the optional reserve for future dividends in the amount of 105,855,278 anddistribute as dividends in kind through the delivery of LEDE National Treasury Bill in pesos at a discount maturing on June 6, 2023 (the “Letters”), for a totalof 25,590,778,098 Letters (“Total Amount of Letters”), with a ratio of 43.858641084 Letters for each share of $0.10 outstanding face value of the Company.The dividend was made available as of May 5, 2023. On June 23, 2023, the Company's Board of Directors resolved to partially cancel the optional reserve for future dividends in the amount of 61,656,058 anddeclare a dividend equivalent to $105.669 per outstanding share. Additionally, the Company's Board of Directors, at its meetings held on April 14, July 1 and December 27, 2022, approved the distribution of dividends for atotal amount of 55,268,424, 93,040,509 and 23,734,641, respectively, and announced as a general principle that shareholders would receive such dividends inPesos and were guaranteed with the option to receive payment of their portion of dividends in the equivalent amount in United States Dollars by converting theoriginal dividend in pesos at the exchange rate called "Reference Exchange Rate of the Central Bank of the Argentine Republic – Com. "A" 3500" prevailing atthe close of the business day immediately prior to the day of dividend availability for distribution; and, in such case, grant shareholders the option of receivingsuch payment through Caja de Valores S.A. in their local bank account or in a bank account held abroad. Dividends were made available on April 26, 2022, July12, 2022, and January 9, 2023, respectively. The amount charged to income as fixed and variable remuneration for key management personnel of the Group was 3,608,264 and 4,728,226 during the fiscalyears ended December 31, 2024 and 2023, respectively. Additionally, 767,896 and 1,518,260 have been accrued as long-term incentive program during thefiscal years ended December 31, 2024 and 2023, respectively. Finally, 65,624 and 17,473 American Depositary Receipts (“ADRs”) were distributed during theyears ended December 31, 2024 and 2023, respectively, under the aforementioned incentive programs. No expenditure has been recognized in this or prior fiscal years in respect of bad or doubtful accounts related to amounts owed by related parties. Amounts outstanding with related parties as of December 31, 2024 are not guaranteed and will be settled in cash. No guarantees have been given or receivedregarding outstanding balances. F-47
Page 202
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 20. OTHER RECEIVABLES 2024 2023 Non-Current Advances to suppliers 5,027,286 1,763,590 Tax receivables 81,072 38,556 Contributions to the Trust Fund to Strengthen the Inter-urban Railroad System (F.F.F.S.F.I.) 1,010,625 618,127 Prepaid expenses 1,138,413 2,222,383 Guarantee deposits 7,210 - Subtotal 7,264,606 4,642,656 Allowance for other doubtful accounts (1,010,625) (618,127) Total 6,253,981 4,024,529 Current Income tax receivables 12,715 12,560,565 Turnover tax receivables - 362,463 Value added tax receivables - 416,542 Receivable for sale of interest in Yguazú Cementos S.A. 1,030,000 1,756,158 Related party receivables (Note 19) 4,763,446 7,972,312 Prepaid expenses 1,917,723 4,349,534 Guarantee deposits - 2,002 Reimbursements receivable 42,417 31,997 Advance payments to suppliers 1,389,238 6,261,514 Salaries advances and loans to employees 125,127 304,211 Insurances receivable - 10,536,950 ADSs service fee receivable 903,219 - Receivables from sales of property, plant and equipment 2,711,507 1,859,112 Miscellaneous 936,018 945,372 Total 13,831,410 47,358,732 21. TRADE RECEIVABLES 2024 2023 Accounts receivable 49,342,819 49,266,625 Accounts receivable in litigations 2,395,425 4,101,086 Notes receivable 524 11,589 Foreign customers - 352,140 Subtotal 51,738,768 53,731,440 Allowance for doubtful accounts (2,489,495) (4,192,048) Total 49,249,273 49,539,392 The trade receivables disclosed above are carried at amortized cost. F-48
Page 203
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Interest is recognized on overdue trade receivables at current market rates. The Group measures the allowance for doubtful receivables for an amount equal tothe losses expected throughout the life of the receivable. The provision is initially based on the Group’s historical observed default rates and it is complementedby a case by case analysis to identify special circumstances on individual customers and/or transactions. This historical percentage should consider theexpectations of future credit collectability and therefore the estimated changes in behavior. Before accepting a new customer, the Group conducts an internal credit analysis to evaluate the potential customer’s credit quality and define its credit limit.The limits and ratings attributed to the main customers are reviewed at least once a year. The trade receivables disclosed in the preceding paragraphs include the amounts (see aging analysis below) which are overdue as of December 31, 2024 and2023. Accounts receivable aging is as follows: 2024 2023 To expire 26,346,865 31,904,043 Past due: 0 to 30 days 17,474,236 15,308,157 31 to 60 days 1,481,764 978,918 61 to 90 days 1,003,378 607,392 More than 90 days 5,432,525 4,932,930 Total 51,738,768 53,731,440 Trade receivables disclosed above include certain amounts (see aging analysis below) that are past due at the end of each reporting period, but for which theGroup has not recognized an allowance for doubtful receivables because there has not been a significant change in credit quality and the amounts are stillconsidered recoverable. Aging of past due, but not impaired, accounts receivable is as follows: 2024 2023 Past due: 0 to 30 days 17,474,236 15,308,157 31 to 60 days 1,481,764 978,918 61 to 90 days 1,003,378 607,392 More than 90 days 2,943,030 740,882 Total 22,902,408 17,635,349 Average age of overdue balances (in days) 30 22 The average aging of past due and impaired accounts receivable is as follows: 2024 2023 Past due: More than 90 days 2,489,495 4,192,048 Total 2,489,495 4,192,048 In determining the recoverability of a trade receivable, the Group considers any change in the credit quality of the receivable from the date the credit wasinitially granted up to the end of each reporting period. The concentration of credit risk is limited due to the fact that the customer base is large and independent,collection terms are short and there exists credit limit controls applicable to each individual sale transaction. F-49
Page 204
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Changes in the allowance for doubtful receivables were as follows: Balance as of January 1, 2023 2,894,340 Increases 4,055,385 Gain on net monetary position (2,755,641) Decreases (*) (2,036) Balance as of December 31, 2023 4,192,048 Increases, net of recoveries 655,007 Gain on net monetary position (2,357,716) Decreases (*) 156 Balance as of December 31, 2024 2,489,495 (*) It includes allocation of provisions for specific purposes. 22. CASH AND BANKS 2024 2023 In Pesos 6,842,658 3,906,087 In Dollars 1,121,174 7,013,099 In Euros 11,005 20,817 In reales 60 - Total 7,974,897 10,940,003 23. CAPITAL STOCK AND OTHER RELATED ACCOUNTS 2024 2023 Capital stock 58,348 58,348 Capital adjustment 93,733,964 93,733,964 Share premium 138,989,677 138,989,677 Treasury shares trading premium 374,298 345,889 Merger premium 31,250,508 31,250,508 Share-based payment plans - 1,240,667 Total 264,406,795 265,619,053 The issued, paid-in and registered capital stock consists of: Common stock with a face value of 0.10 per share and entitled to 1 vote each, fully paid-in (in thousands) 583,483 583,483 Acquisition of treasury shares:Based on the context and the Group’s financial position, the Board of Directors approved various plans for the acquisition of own shares. The purpose of theseplans was to use a portion of the Company’s liquidity in an efficient manner, which might result in a higher shareholder return and therefore increaseshareholder value considering the current value of the shares. Pursuant to Article 64 of the Capital Markets Law, treasury stock may not exceed, as a whole, thelimit of 10% of capital stock. Such acquisitions were made with realized and liquid profits, as the Company had the necessary liquidity to conduct theacquisition of treasury stock, as approved, without affecting its solvency. F-50
Page 205
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Until December 31, 2023 , the Group acquired 12,352,329 own shares for a total value of 43,492,096 and 27,542 ADRs for a total value of 231,827, whosedestination has been the following, with no own shares in the portfolio as of that date: • Within the framework of the incentive programs for senior staff, 17,473 and 10,069 ADRs were distributed. • On April 25, 2023, the Ordinary and Extraordinary General Shareholders' Meeting approved the voluntary reduction of the Company's share capital for atotal of 12,543,339 ordinary shares (which included 12,352,329 shares in the portfolio and 191,010 unnamed actions). During the year ended December 31, 2024, the Group acquired 65,624 ADRs for a total value of 594,830. F-51
Page 206
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 24. BORROWINGS 24.1. Composition of borrowings 2024 2023 Borrowings - In foreign currency 156,365,535 242,499,385 - In local currency 14,535,670 78,419,474 Total 170,901,205 320,918,859 Non-current borrowings 70,221,168 239,856,931 Current borrowings 100,680,037 81,061,928 Total 170,901,205 320,918,859 24.2 Detail of borrowings 2024 2023 Ref. Company Rate Last maturitydate Amount Amount Borrowings in foreign currency - USD Negotiable promissory notes (1) Loma Negra C.I.A.S.A. 6.00% Jan-25 1,026,977 - Negotiable promissory notes (1) Loma Negra C.I.A.S.A. 6.00% Feb-25 2,563,066 - Negotiable promissory notes (1) Loma Negra C.I.A.S.A. 7.00% Sep-25 1,770,302 - Negotiable promissory notes (1) Loma Negra C.I.A.S.A. 7.00% Oct-25 2,925,992 - Negotiable promissory notes (1) Loma Negra C.I.A.S.A. 7.25% Dec-25 2,418,884 - Negotiable promissory notes (1) Loma Negra C.I.A.S.A. 7.25% Jan-26 2,284,544 - Negotiable promissory notes (1) Loma Negra C.I.A.S.A. 7.25% Feb-26 104,302 - Negotiable promissory notes (1) Loma Negra C.I.A.S.A. 7.50% Apr-26 763,552 - Banco Patagonia (2) Ferrosur Roca S.A. - - - 81,184 Banco Patagonia (2) Ferrosur Roca S.A. - - - 192,008 Total borrowings in foreign currency 13,857,619 273,192 Borrowings in local currency Bank overdrafts (3) Ferrosur Roca S.A. 38.24% Jan-25 4,873,033 5,018,973 Bank overdrafts (3) Loma Negra C.I.A.S.A. 38.00% Jan-25 295,789 10,116,128 Securities-guaranteed borrowing (4) Loma Negra C.I.A.S.A. 37.41% Jan-25 9,366,848 - Total borrowings in local currency 14,535,670 15,135,101 F-52
Page 207
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 2024 2023 Ref. Company Rate Last maturitydate Amount Amount Corporate notes - USD Serie – Class 2 (5) Loma Negra C.I.A.S.A. 6.50% Dec-25 74,103,576 125,979,900 Serie – Class 3 (5) Loma Negra C.I.A.S.A. 7.49% Mar-26 57,997,572 98,565,157 Serie – Class 4 (5) Loma Negra C.I.A.S.A. 6.00% May-26 10,406,768 17,681,136 Total corporate bonds in foreingcurrency 142,507,916 242,226,193 2024 2023 Ref. Company Rate Last maturitydate Amount Amount Corporate notes - Ps. Serie – Class 1 (6) Loma Negra C.I.A.S.A. - - - 63,284,373 Total corporate bonds in local currency - 63,284,373 Total 170,901,205 320,918,859 (1) As of December 31, 2024, Loma Negra entered into fundraising agreements by issuing promissory notes through the EPYME channel of Caja deValores S.A. These notes bear interest at a fixed rate and are not guaranteed. (2) During the fiscal year 2023 and 2022, Ferrosur Roca S.A. entered into several contracts in US dollars with Banco Patagonia, accruing interest at a fixedrate. As of December 31, 2024, these loans have been cancelled. (3) As of December 31, 2024 and 2023, the Group carries bank overdrafts in the amount of 5,168,822 and 15,135,101, respectively. Bank overdraftsexisting at the beginning of the year were canceled regularly during fiscal year 2024. (4) During the fiscal year ended December 31, 2024, Loma Negra took a borrowing through Banco de Valores S.A., providing as collateral securitiesobtained on loan. The cost of these guarantees is included in the borrowing rate and is accrued over their duration. The Group does not recognize assetsor liabilities in connection with the collateral granted because its loan conditions do not provide risks and rewards of ownership over them. (5) On June 21, September 11, and November 2, 2023, the Company issued its Class 2, 3 and 4 Corporate Bonds in dollars for a total amount of US$71,723thousand, US$55,000 thousand and US10,000 thousand, with an interest rate of 6.5%, 7.49% and 6.00%, and maturing on December 21, 2025, March11, 2026 and May 2, 2026, respectively. Interest is paid semiannually. The issuance of these corporate bonds in foreign currency has been carried outwithin the scope of the local public offering, without intervention of the single and free exchange market ("MULC"). These debts have been valued attheir amortized cost in foreign currency, converting the resulting amounts into local currency at the official selling exchange rate effective at the end ofthe reporting period. (6) On February 22, 2023, the Company issued its Class 1 Corporate Bonds for a total amount of $25,636.3 million, with an interest rate BADLAR + 2.0%,principal maturity at 18 months and payments quarterly interest. As of December 31, 2024, these corporate bonds have been cancelled. F-53
Page 208
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 2024 2023 Total borrowings by company: - Loma Negra C.I.A.S.A. 166,028,172 315,626,694 - Ferrosur Roca S.A. 4,873,033 5,292,165 Total 170,901,205 320,918,859 24.3 Movements of borrowings The movements of borrowings for the fiscal year ended December 31, 2024, are disclosed below: Balances as of January 1, 2024 320,918,859 New borrowings 330,130,588 Accrued interest and other financial expenses 57,708,542 Effects of foreign exchange rate variation 39,959,370 Gain on net monetary position (201,750,443) Interest payments (61,590,691) Principal payments (314,475,020) Balances as of December 31, 2024 170,901,205 As of December 31, 2024, long-term borrowings have the following maturity schedule: Fiscal year 2026 70,221,168 Total 70,221,168 25. ACCOUNTS PAYABLE 2024 2023 Suppliers 72,161,439 91,078,280 Related parties (Note 19) 3,384,888 6,645,713 Accounts payable for investments in property, plant and equipment 1,623,921 758,236 Provisions for expenses 16,420,554 26,198,864 Total 93,590,802 124,681,093 26. PROVISIONS 2024 2023 Labor and social security 2,577,335 2,843,515 Environmental restoration 7,444,480 9,960,560 Civil and other 1,219,220 1,876,495 Total 11,241,035 14,680,570 F-54
Page 209
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Changes in provisions are as follows: Labor andsocial security Environmentalrestoration Civil and other Total Balance as of January 1, 2023 3,010,487 4,833,458 1,020,270 8,864,215 Increases (*) 3,507,981 11,934,535 2,894,879 18,337,395 Gain on net monetary position (3,205,320) (6,172,664) (1,680,529) (11,058,513) Decreases (**) (469,633) (634,769) (358,125) (1,462,527) Balance as of December 31, 2023 2,843,515 9,960,560 1,876,495 14,680,570 Increases (*) 2,224,288 3,571,824 919,963 6,716,075 Gain on net monetary position (2,064,881) (5,762,569) (1,027,285) (8,854,735) Decreases (**) (425,587) (325,335) (549,953) (1,300,875) Balance as of December 31, 2024 2,577,335 7,444,480 1,219,220 11,241,035 (*) The increase in the environmental provision includes the increase resulting from changes in the measurement of liabilities arising from the estimatedrestoration schedule and the discount rates used as of December 31, 2024 and 2023, respectively, the effect of which has adjusted the cost of therelevant assets. (**) It includes the uses of provisions for specific purposes. The provision for labor and social security claims represents the present value of the best estimate of future cash flows that will be required for the Group tocover labor and social security litigations. All the provisioned claims are of a similar nature and none of them is individually significant. Environmental provisions are the provisions made to afford the estimated expenses for the environmental recovery and restoration of the mining areas and theretirement of assets used in production activities, as mentioned in Note 3.12. The provision for civil and other claims represents the present value of the best estimate of future cash flows that will be required for the Group to cover tax,administrative and civil litigations. All the provisioned claims are of a similar nature and none of them is individually significant. As of December 31, 2024, as mentioned in Note 3.12, there are claims against the Group classified as possible contingencies. The potential risk amount of thoseclaims is $10,861 million, mainly including $306 million related to tax contingencies, $4,308 million related to labor contingencies, and $6,247 million relatedto administrative, commercial and other proceedings. The Group has not recognized a provision for such possible claims, as it is not required under IFRSAccounting Standards. As of the date of issuance of these consolidated financial statements, the Group understands there is no evidence to determine that othercontingencies could materialize and have a negative impact on the consolidated financial statements. In the normal course of business, the Group selects tax criteria and accounting positions based on a reasonable interpretation of applicable rules and regulations,also taking into consideration the opinion of its tax and legal advisors along with the evidence available up to the date of issuance of these consolidatedfinancial statements. Nevertheless, there are situations where the assessment by a third party and the possible materialization of damage for the Group areuncertain. In such cases, the Group has not recognized a provision as it is not required by IFRS Accounting Standards. F-55
Page 210
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 27. TAX LIABILITIES 2024 2023 Income tax 39,735,356 441,351 Value added tax 4,186,369 2,999,727 Turnover tax 1,694,556 1,845,823 Other taxes 1,228,399 1,139,392 Total 46,844,680 6,426,293 28. OTHER LIABILITIES 2024 2023 Non-current Employee benefit plans 850,239 807,495 Termination payment plans 159,959 233,230 Total 1,010,198 1,040,725 Current Termination payment plans 479,259 656,736 Dividends payable to third parties minority 226,309 492,820 Agreement for settlement of claims - 10,536,950 Others 290,698 198,543 Total 996,266 11,885,049 29. CASH AND CASH EQUIVALENTS For purposes of the consolidated statement of cash flows, cash and cash equivalents include cash and banks, and short-term investments with high liquidity(with maturities of less than 90 days from the date of acquisition), held to settle short term liabilities, which are easily convertible into cash and that have lowrisk of changes in their value. Cash and cash equivalents at the end of each reporting period as disclosed in the consolidated statement of cash flows can bereconciled to the related items in the consolidated statement of financial position as follows: 2024 2023 2022 Cash and banks (Note 22) 7,974,897 10,940,003 4,506,901 Short-term investments (Note 16) 578,466 3,724,558 28,795,604 Cash and cash equivalents 8,553,363 14,664,561 33,302,505 30. NON-CASH TRANSACTIONS Below is a detail of the transactions that did not involve cash flows in each fiscal year: 2024 2023 2022 - Right of use assets and lease liabilities 290,390 154,795 4,703,725 - Acquisition of financed property, plant and equipment 3,045,788 758,353 11,453,585 - Delivery of shares – benefit plans 623,239 397,140 180,572 F-56
Page 211
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 31. SEGMENT INFORMATION The Company has adopted IFRS 8 Operating Segments, that requires operating segments to be identified on the basis of internal reports regarding componentsof the Company that are regularly reviewed by the Executive Committee, the chief operating decision maker, in order to allocate resources and to assess theirperformance. This analysis is based on monthly information consisting of historical figures of the identified segments. The information reviewed by the main decision makerconsists of the historical details for each month accumulated until the end of the reporting periods being analyzed, which is the reason why they differ from theinflation-adjusted figures as described in Note 2.2. For management purposes, both financially and operative, the Company has classified its businesses' activities as follows: i) Cement, masonry cement and lime: this segment includes profit or loss from the cement, masonry cement and lime business, from procurement of rawmaterials in quarries, the manufacturing process of clinker and quicklime and their subsequent grinding with certain aggregates for the production ofcement, masonry cement and lime. ii) Concrete: this segment includes profits or loss from the production and sale of ready-mix concrete. It also includes the delivery of the product at theworksite and, depending on the circumstances, the pumping of concrete up to the place of destination. iii) Aggregates: this segment includes profits or loss from the aggregates business, from obtaining to crushing the stone. iv) Rail Services: this segment includes profits or loss from the provision of rail transportation services. v) Others: this segment includes profits or loss from the industrial waste treatment and recycling business for use as fuel. 2024 2023 2022 Revenues With external customers Cement, masonry cement and lime 498,089,236 199,296,795 93,960,619 Concrete 45,911,178 21,866,051 9,389,682 Rail services 20,122,374 7,094,031 3,896,662 Aggregates 8,053,922 3,999,497 1,451,374 Others 4,621,647 1,083,067 545,035 With other segment Cement, masonry cement and lime 12,800,770 5,710,569 2,538,218 Rail services 33,948,181 11,356,675 4,823,810 Aggregates 6,077,811 3,071,874 1,323,718 Others 1,250,457 271,908 119,297 Segment-to-segment eliminations (54,077,219) (20,411,026) (8,805,043) Total 576,798,357 233,339,441 109,243,372 Effect from restatement in constant currency 122,380,329 685,973,268 874,948,170 Total 699,178,686 919,312,709 984,191,542 F-57
Page 212
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 2024 2023 2022 Cost of sales Cement, masonry cement and lime 292,531,446 118,763,699 58,125,212 Concrete 45,145,185 20,728,478 8,924,833 Rail services 47,920,996 17,254,059 8,308,344 Aggregates 14,910,149 6,081,288 2,282,557 Others 3,382,932 896,919 389,501 Segment-to-segment eliminations (54,077,219) (20,411,026) (8,805,043) Total 349,813,489 143,313,417 69,225,404 Effect from restatement in constant currency 162,384,229 545,371,841 649,187,897 Total 512,197,718 688,685,258 718,413,301 2024 2023 2022 Selling, administrative and other expenses Cement, masonry cement and lime 45,884,427 17,259,548 4,345,407 Concrete 1,798,507 681,148 337,403 Rail services 2,404,037 1,021,921 469,408 Aggregates 160,570 72,640 33,259 Others 1,445,670 453,282 211,365 Total 51,693,211 19,488,539 5,396,842 Effect from restatement in constant currency 16,926,904 62,712,106 56,483,813 Total 68,620,115 82,200,645 61,880,655 2024 2023 2022 Depreciation and amortization Cement, masonry cement and lime 4,718,826 3,097,258 2,411,444 Concrete 215,603 104,245 57,140 Rail services 1,129,139 546,760 607,668 Aggregates 339,618 117,188 55,837 Others 6,192 5,241 4,978 Total 6,409,378 3,870,692 3,137,067 Effect from restatement in constant currency 56,217,119 66,230,641 86,905,142 Total 62,626,497 70,101,333 90,042,209 F-58
Page 213
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 2024 2023 2022 Revenues less cost of sales, selling and administrative expenses, and other gains and losses Cement, masonry cement and lime 172,474,133 68,984,117 34,028,218 Concrete (1,032,514) 456,425 127,446 Rail services 3,745,522 174,726 (57,280) Aggregates (938,986) 917,443 459,276 Others 1,043,502 4,774 63,466 Total 175,291,657 70,537,485 34,621,126 Effect from restatement in constant currency (56,930,804) 77,889,321 169,276,460 Total 118,360,853 148,426,806 203,897,586 Reconciling items Tax on debits and credits to bank accounts (7,420,391) (10,183,752) (9,868,503) Financial results gain (loss), net 138,611,341 (100,312,435) (119,414,153) Income tax (95,925,288) (16,849,960) (62,361,904) Net profit for the year 153,626,515 21,080,659 12,253,026 In relation to the segregation of profit or loss by geographic segment, the Group carries out its activities and operations in Argentina, exports are not significant. No customer contributed 10% or more of the Group’s revenue for the years ended December 31, 2024, 2023 and 2022, respectively. 32. FINANCIAL INSTRUMENTS 32.1 Capital risk management The Group manages its capital stock to ensure that its entities will be able to continue as a going concern while maximizing the return to its shareholdersthrough the optimization of debt and equity balances. The Group’s strategy has not changed for the financial years 2024 and 2023. The Group and its subsidiaries participate in transactions involving financial instruments, recognized as equity items, which are intended to meet their needsand to reduce exposure to market, currency and interest rate risks. These risks, as well as their respective instruments, are managed through the definition ofstrategies, the implementation of control systems, and the determination of exposure limits. The Group’s capital structure consists of net debt (borrowings as detailed in Note 24 offset against cash, banks and short term investments) and shareholders’equity (consisting of issued capital stock, reserves and retained earnings). The Group does not have financial liabilities that arise from supplier finance arrangement. The Group is not subject to any external capital requirement. The Group’s risk management committee reviews the capital structure of the Group. F-59
Page 214
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Net debt-to-equity ratio: The net debt-to-equity ratio for the reporting fiscal years is as follows: 2024 2023 Debt (i) 170,901,205 320,918,859 Cash and current investments 8,553,363 14,664,561 Net debt 162,347,842 306,254,298 Shareholders’ Equity (ii) 793,121,742 640,707,485 Net debt-to-equity ratio and shareholders’ equity 0.20 0.48 (i) Debt is defined as long and short-term borrowings.(ii) Shareholders’ equity includes non-controlling interest, which are managed as capital stock. 32.2 Categories of financial instruments 2024 2023 Financial Assets At amortized cost: Cash and banks 7,974,897 10,940,003 Investments 64,024 3,658,136 Accounts receivable and other receivables 59,187,173 72,652,644 At fair value through profit or loss: Investments 514,442 66,422 2024 2023 Financial Liabilities Amortized cost 335,948,458 494,106,399 At the end of this reporting period, there are no significant credit risk concentrations for debt instruments designated at fair value through profit or loss. Thecarrying amount reflected above represents the Group’s maximum exposure to credit risk for such instruments. 32.3 Financial risk The treasury function offers services to business, coordinates access to domestic and international financial markets, monitors and manages the financial risksrelated to the Group’s operations through internal risk reports, which analyze exposures depending on the degree and extent thereof. These risks include marketrisk (including currency risk, interest rate at fair value and price risk), credit risk and liquidity risk. The Company and its subsidiaries do not employ or tradedderivative financial instruments for speculative purposes. Monitoring compliance with these provisions policy is made by the executive committee and theinternal audit team. 32.4 Foreign exchange risk management The Group carries out transactions in foreign currency; and is hence exposed to exchange rate fluctuations, also considering the current exchange regulations inforce. Exposures in the exchange rate are managed within approved policy parameters using foreign exchange contracts. F-60
Page 215
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) The carrying amounts of monetary assets and liabilities denominated in foreign currency at the end of the fiscal years ended December 31, 2024 and 2023 areas follows: 2024 2023 Liabilities: United States Dollars 178,103,373 283,590,640 Euros 1,318,559 1,510,270 Reales 423 922 2024 2023 Assets: United States Dollars 9,980,235 34,328,375 Euros 11,005 20,817 Reales 60,000 - 32.4.1. Foreign currency sensitivity analysis The Group is mainly exposed to the US Dollar and Euro, considering that the Group’s functional currency is the Argentine peso. The following table details the Group’s sensitivity to an increase in the exchange rate of the US Dollar and the Euro as of December 31, 2024. The sensitivityrate is the rate used when reporting exchange rate risk internally to key management staff and represents management’s assessment of a possible reasonablechange in exchange rates. The sensitivity analysis includes only outstanding monetary items denominated in foreign currency and adjusts their translation onthe balance sheet day for a 25% change in the exchange rate, considering for its calculation the whole of the items of the subsidiaries. US Dollar effect Euro effect Income for the year 42,030,784 326,889 Shareholders’ Equity 42,030,784 326,889 Additionally, considering the exchange regulations currently applicable in Argentina, the Group constantly monitors the alternatives for collecting assets andsettling liabilities in foreign currency and the related impact. The gain/loss arising from the use of financial instruments to settle transactions in foreign currencyis recognized when the Group unconditionally commits to or irreversibly executes such settlement. As of December 31, 2024, the use of financial instruments tosettle the above transactions would result in an impact of approximately 15%. Likewise, as of December 31, 2024, 2023 and 2022, the gain/loss from using such instruments to settle certain financial borrowings was Ps. 544,055, Ps.3,998,429 and Ps. 119,594,515 and is recorded in the statement of profit or loss and other comprehensive income within financial results as "Loss fromsecurities transactions” (Note 10). F-61
Page 216
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 32.5 Interest rate risk management The Group is exposed to the risk of significant fluctuations in interest rates because Group entities have borrowings at both fixed and floating interest rates. TheGroup manages this risk by maintaining an appropriate combination of fixed- and floating-rate borrowings. 2024 2023 Financial Assets: Investments held to maturity (1) 64,024 3,658,136 Investments at fair value through profit or loss (2) 514,442 66,422 Financial Liabilities: Amortized cost (3) 170,901,205 320,918,859 (1) Fixed-term deposits at fixed rates.(2) Short-term investments at floating rates.(3) Related to borrowings, as detailed in Note 24. 32.5.1. Interest rate sensitivity analysis The sensitivity analysis below has been determined based on the exposure to interest rates for non-derivative financial instruments at the end of this fiscal year.For floating-rate liabilities, the analysis is prepared based on an average monthly debt balance. A 100-basis point increase or decrease is used when reportinginterest rate risk internally to key management personnel and represents management’s assessment of the reasonable threshold to conduct an interest rate riskanalysis. In the event that the average BADLAR rate applicable to financial liabilities for the fiscal year ended December 31, 2024, were 1.0% higher than the averageinterest rate during that fiscal year, financial expenses for the fiscal year ended December 31, 2024, would have increased by approximately 200,908. With regard to financial assets, a 1.0% increase in the average interest rate during the fiscal year ended December 31, 2024, would have increased financialincome by approximately 13,302. 32.6 Credit risk management Credit risk refers to the risk that one of the parties will fail to comply with its contractual obligations and resulting in a financial loss to the Group. The Grouphas adopted a policy of engaging only with solvent parties and obtaining sufficient collateral, where appropriate, as a way of mitigating the risk of financial losscaused by defaults. Credit exposure is controlled by counterparty limits, which are reviewed and approved periodically. Trade receivables are made up of a significant number of customers. Credit assessment is continuously performed on the financial condition of accountsreceivable. Credit risk on liquid funds and financial instruments is limited because the counterparties are banks with high credit ratings assigned by credit rating agencies. The carrying amount of financial assets recognized in the consolidated financial statements, which is net of impairment losses, represents the maximumexposure to credit risk, regardless of the guarantees of accounts or other credit enhancements. 32.7 Liquidity risk management The Group’s Board of Directors has the ultimate responsibility for liquidity management, having established an appropriate framework for liquiditymanagement so that management is able to deal with short-, medium- and long-term financing F-62
Page 217
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) requirements, as well as the Group’s liquidity management. The Group manages liquidity risk by maintaining reserves, adequate financial and lending facilities,continuously monitoring projected and actual cash flows, and reconciling the maturity profiles of financial assets and liabilities. The Group carefully manages liquidity risk, and therefore it maintains cash and bank balances, liquid instruments, and available funds. The Group’s Board of Directors considers that exposure to liquidity risk is low as the Group has generated cash flows from its operating activities, as a result ofits operations, and has access to borrowings and financial resources, as explained in Note 24. The following tables show the Group’s remaining contractual maturity dates for its non-derivative financial liabilities with agreed repayment terms. The tableshave been drawn up based on undiscounted cash flows of financial liabilities based on the earliest date on which the Group may be required to pay. The tablesinclude both interest and principal cash flows. To the extent that interest flows are at floating rates, the undiscounted amount is derived from interest rate curvesat the end of this reporting period. Borrowings Weightedaverageeffectiveinterest rate % Less than 1month From 1to 3months From 3months to1 year From 1 to3 years Total As of December 31, 2024 21% 15,567,670 4,688,191 89,324,176 72,692,382 182,272,419 As of December 31, 2023 61% 15,112,787 21,531,945 104,451,417 260,692,229 401,788,378 Leases Weightedaverageeffectiveinterest rate % Lessthan 1month From 1to 3months From 3months to1 year From 1to 3years From 3 to6 years Total As of December 31, 2024 (*) 126,671 253,342 1,115,469 2,285,686 - 3,781,168 As of December 31, 2023 (*) 235,392 706,534 2,106,774 7,545,513 322,487 10,916,700 (*) The average rates in Pesos were 50% and 53% for the fiscal years ended December 31, 2024 and 2023, respectively. The average rates in US Dollars were13% and 12% for the fiscal years ended December 31, 2024 and 2023, respectively. 32.8 Fair value measurements Some of the Group’s financial assets are measured at fair value at the end of this reporting period. The following table provides information on how the fairvalues of these financial assets are measured (particularly, valuation techniques and inputs used). Fair value at: Hierarchy level Financial assets 2024 2023 Assets: Mutual Funds 514,442 66,422 Level 1 Level 1: quoted price in an active market. F-63
Page 218
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Fair value of financial assets and financial liabilities measured at amortized cost: The estimated fair value of borrowings based on the interest rates offered to the Group (Level 3) for financial borrowings amounted to 172,034,791 and317,469,004 as of December 31, 2024 and 2023, respectively. The Board considers that the carrying amounts of the remaining financial assets and liabilities recognized at amortized cost in the consolidated financialstatements approximate their fair values. 33. COMMITMENTS The Group has certain contractual commitments to purchase slag valid until 2028. The estimate of future cash flows is approximately Ps. 7,479,441 thousandper year. Additionally, it has commitments to purchase granite stone up to 2025 for an annual average of Ps. 69.6 million. In the ordinary course of business, to ensure the supply of key inputs, the Group has entered into contracts for the supply of gas, assuming paymentcommitments for a total amount of approximately Ps. 55,080, of which Ps. 31,810 is payable during fiscal year 2025, Ps. 17,668 during fiscal year 2026 and Ps.5,602 million during fiscal year 2027. In addition, the Group has entered into power supply agreements with certain suppliers for a total amount of Ps. 102,280, of which Ps. 14,621 per year ispayable until 2028 and, and Ps. 43,797 from 2029. The Group entered into a product sales contract under which it has undertaken to supply concrete and cement so that a third party can carry out residentialprojects in the City of Buenos Aires. The contract provides that the Group shall collect a portion of the concrete sales in kind by receiving functional units ofthe real estate developments upon completion, for which the related agreement of sale has been signed. In addition, the contract include various rights andobligations for the parties to ensure fulfillment of the main purpose of the contract, which is the purchase and sale of concrete. 34. GUARANTEES GRANTED TO SUBSIDIARIES The Company guarantees the bank overdrafts borrowed by Ferrosur Roca S.A. in the normal conduct of its business, and the letters of credit to be entered intoby the company to finance imports up to a maximum amount of Ps. 17,500 million. As of December 31, 2024, Ferrosur Roca S.A. carries current accountoverdraft balances for 4,873,033. 35. RESTRICTED ASSETS As of the date of these consolidated financial statements, the Group has judicial deposits for 36,326, which are disclosed in other current and non-currentreceivables. 36. FERROSUR ROCA S.A. CONCESSION AND RELATED RAIL SERVICES On March 11, 1993, Ferrosur Roca S.A. obtained the concession of the General Roca National Cargo Railway Network with the exception of the Altamirano-Miramar corridor and the urban sections, through the approval of the concession contract formalized by National Executive Branch Decree No. 2681/92, afterthe presentation made through a national and international tender and formalized to that effect. The area of influence is concentrated in the center and south ofthe province of Buenos Aires, north of the province of Río Negro and Neuquén. It has access to the ports of Buenos Aires, Dock Sud, La Plata, Quequén, andBahía Blanca. Ferrosur Roca S.A. is indirectly controlled by the Company, through Cofesur S.A.U. which owns 80% of the interest, 16% of which belongs to the NationalState and the remaining 4% belongs to the workers of Ferrosur Roca S.A. through a trust created for this purpose. F-64
Page 219
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) The term of the concession is 30 years, which expires in March 2023, and originally provides for an extension of 10 additional years. Ferrosur Roca S.A. requested the above-mentioned extension in due time on March 8, 2018, and in line with the bidding terms and conditions and theconcession agreement. The concession extension request was reiterated on March 1, 2019. However, as it is mentioned in following paragraphs, the federal government issued diverse regulations with the objective that the national railway network bebased on a mixed modality combining public and private cargo operators, where the National State will manage the infrastructure and control the relatedinvestments, thus allowing any registered railway operator to provide railway services regardless of who owns or possesses the facilities at the point of loadingor destination (the "open access" scheme). On March 29, 2021, through Resolution No. 219/2021, the National Commission for Transport Regulation (“CNRT”) approved the Rules and Regulations ofthe National Registry of Railway Operators and granted such capacity to Ferrosur Roca S.A. and the other railway concessionaires that operate the currentconcessions. Consequently, based on that resolution, once the open access scheme be implemented, any registered railway operator will be able to providecargo services as previously mentioned. Subsequently, through Resolution No. 211 of the Ministry of Transport, it was rejected the request for an extension of the concession contracts duly submittedby the Group in 2018 jointly with similar requests by the other private railway concessionaires, confirming the finalization of all existing concessionagreements. Additionally, the Ministry of Transport published diverse resolutions granting extensions for periods of 12 and 18 months to the concession grantedto the concessionaires, including Ferrosur Roca S.A., based on which the concession term has been extended by a second time until September 2025. Thatresolutions provide that during the extended concession period the services will be delivered on a provisional basis and may be revoked at any time without thisgenerating any subjective right, pending right or setting any precedent that may be claimed in favor of the operators, or otherwise the recognition of any amountfor the potential early revocation of the additional concession term granted. On July 8, 2024, Law N° 27,742, known as the "Bases Law," was published in the Official Gazette, which enables the National Executive Power to tender newconcessions, including the railway system. Additionally, on June 13, 2024, through Decrees No. 525 and N° 526/2024, the Government declared a public emergency in railway matters for a period of 24months. This measure, announced via the Official Gazette, aims to "safeguard the operational safety of the provision of cargo and passenger railway transportservices", no issuing any new regulations or norms related to the implementation of the mentioned "open access" scheme, and it authorized the Ministry ofTransport to carry out transactional acts and/or compensations within the framework of the final settlement of the Concession Contracts approved by DecreesN° 1144 of June 14, 1991, N° 994 of June 18, 1992, N° 2681 of December 29, 1992, N° 2608 of December 22, 1993, and N° 430 of March 22, 1994, as well asthose signed with the provinces under Decrees No. 532 of March 27, 1992, and N° 1168 of July 10, 1992. Considering the provisions of Resolution N° 960/2022, the Group has assessed the possible business scenarios, considering that its intention is to continueproviding services as operator of the railway network. In these scenarios, the National State, responsible for managing the train traffic control systems andmaintaining the railway infrastructure, would charge the Group a fee for the use of the railway infrastructure, which would replace direct maintenance expenses currently paid by the concessionaires plus applicable tolls. No other significant changes are currently known regarding the rest of the matters and activities ascompared to the current business model of the Group. The Group has reassessed all variables affecting accounting estimates associated with the end of the current concession, including the term for the provision ofrail services, the routes and businesses that would be assigned and the future demand for rail freight, no expecting to date any significant impact. The Groupwill continue monitoring the new regulations as they come into effect, as well as the progress of ongoing negotiations with the National State and will recordany related effect as soon as it is possible to make an estimate. The Group’s Management understands that the intention of the National State is to prioritize thecontinuity of the current operators for each of the existing services and businesses, thus guaranteeing the best use of the experience they have acquired. F-65
Page 220
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 37. FUND ADMINISTRATION TRUST FOR INVESTMENT WORKS On February 5, 2013, a trust agreement was entered into between Ferrosur Roca S.A. and Banco de la Nación Argentina to conduct the formalization processnecessary to manage the funds paid by Ferrosur Roca S.A. for the investment works intended to strengthen the interurban rail system. The trust assets are the amounts contributed by the trustor which are amounts resulting from the application of the Memorandum of Agreement entered intobetween the Group and "Unidad de Renegociación y Análisis de Contratos de Servicios Públicos" (Unit for the Renegotiation and Analysis of Public ServiceContracts) dated May 19, 2008 and ratified by Decree No. 2017 of November 25, 2008, the income that the trust might earn from temporary placement of idleresources, the funds existing in the current account that the Group held at Standard Bank as of February 2013 and any other amounts that must be added to thetrust. With the enactment of Resolution No. 218 by the Ministry of Transport on July 27, 2016, which was published on August 3, 2016, the procedure for thecertification of works proposed by the railway concessionaires was established. Exhibits I and II of the above-mentioned resolution set a clear procedure whereby the Group must submit the projects of the works to be funded with the trustfunds, the circuit to study the projects by the different agencies (National Committee for Transportation Regulation, ADIP and Secretariat of Transportation),the requirements for approval and the contents of the administrative act to be handed down by the competent authority approving the project and the maximumamount to be assigned to the trust accounts for such project. Based on the new regulation, the Company recognizes in other receivables the contributions to the Trust Fund for the Strengthening of the Interurban RailwaySystem (“FFFSFI”) for which it has the right of reimbursement for infrastructure works under the concession agreements, net of an impairment reserve for theamounts it expects will not be recovered or used against future capital expenditures due to the concession end date. The contributions made during 2024amounted to Ps. 889,806. Although the use of trust funds requires approval by the regulatory authority; the nature of the capital-intensive activity guarantees the need for infrastructureworks in the amounts contributed, making it unlikely that such approvals will not be granted. 38. RESTRICTIONS ON DIVIDEND DISTRIBUTION In accordance with the provisions of Law 19,550, the Group is required to make a legal reserve of not less than 5% of the positive result arising from the sum ofthe income for the year, the adjustments from previous years, transfers of other comprehensive income to retained earnings, and accumulated income (losses)from previous years, to complete 20% of the sum of capital stock and the capital adjustment balance. On September 1, 2019, the Argentine Central Bank issued Communication “A” 6,770, subsequently amended by Communication “A” 6,869, where therequirements for access to the exchange market are established for remittance abroad of foreign currency as profits and dividends to non-resident shareholders. F-66
Page 221
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) 39. COMPLAINTS BROUGHT AGAINST THE GROUP AND OTHERS IN THE UNITED STATES During 2018, two lawsuits were brought in the United States (“USA”) against the Group, its directors and some of its first-line managers and the controllingshareholder at the time of the Company’s initial public offering in 2017 (“Initial Public Offering” or “IPO”), one in federal court and the other in the state ofNew York. Regarding the lawsuit filed in federal jurisdiction, after various motions from the parties, on April 27, 2020, the Court sustained the motion to dismiss filed bythe Group. Finally, on July 21, 2020, the plaintiffs voluntarily withdrew the appeal filed against the judgment of first instance that fully sustained the motion todismiss submitted by the Group. Accordingly, a final and conclusive judgment was rendered in favor of the Group and the rest of the defendants, and thelawsuit came to an end. Regarding the state class action (Kohl v. Loma Negra CIASA, et al. -Index No. 653114/2018 - Supreme Court of the State of New York, County of New York),the complaint was filed with the state courts of New York in June 2018 by Dan Kohl –a shareholder who acquired ADSs issued by the Company during its 2017initial public offering. The banks that placed the ADSs have also been sued. In the complaint, the plaintiff alleges assumed violations of the US FederalSecurities Law on grounds of allegedly false representations contained in the Offering Memorandum and/or failure to include relevant information. On March13, 2019, the Company filed a motion to dismiss the lawsuit, which, after various instances, resulted in a partially favourable ruling for the Group dated June 1,2021. This ruling narrowed down the grounds on which the case could proceed according to the plaintiff's allegations, leaving only two points out of all theclaims to be addressed in the discovery process: (i) whether there were indeed irregularities on the part of an affiliate of the Group, and (ii) whether it is truethat there was a slowdown in payments for public works at the time of the IPO. In addition, on January 11, 2021, the plaintiff requested to certify the case as a class action, which, after various submissions from the parties, was granted bythe court on December 2, 2021. On January 6, 2022, the case was reassigned from Judge Schecter to another judge in the Commercial Division of the New York Supreme Court, Judge Borrok. On October 11, 2023, we entered into a proposed agreement with the lead plaintiff which received the preliminary approval from the New York State Court onNovember 30, 2023. On April 10, 2024 the final approval by the New York State Court was granted. The New York State Court issued a final judgment underthe Settlement on March 3, 2025. The deadline to appeal the judgment expired on April 2, 2025 and no appeal was filed. As a result, the settlement is nowcompletely final and the releases are effective. The Agreement does not contain any admission or acknowledgment of guilt for wrongful conduct by Loma Negra or other defendants in the class action, and itincludes a release of all claims. 40. THE ARGENTINE CONTEXT During 2024, the federal government promoted several bills and succeeded in approving some key regulations for Argentina's economic activity. The maininitiatives include the approval of the Law for the Bases and Starting Points for Argentines' Freedom No. 27,742 (“Bases Law”), which includes the declarationof a public emergency granting the Federal Executive delegated powers in several areas; the reform of the State, which will allow the government to sell somegovernment-owned companies; the modernization of labor regulations to encourage the growth of formal private employment; the deregulation of the energysector, aimed at maximizing the oil & gas production in the country for sale and export purposes; and an incentive system for large investments, applicable toenergy, oil, gas and infrastructure projects. The federal government also approved a fiscal package that includes an tax amnesty program and a regularization system for assets, allowing for thelegalization of money and goods. These measures seek to achieve fiscal balance, with a zero monetary emission policy, and it has enabled the government toachieve in a short term a primary and financial surplus, as well as to begin an inflation deceleration process, that recorded 117,8% during 2024. F-67
Page 222
Table of Contents LOMA NEGRA COMPAÑÍA INDUSTRIAL ARGENTINA SOCIEDAD ANÓNIMANOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022(figures expressed in thousands of pesos - $ - except as otherwise stated) Regarding the foreign exchange market, the federal government has been gradually easing the extensive regulatory framework that ruled the access to foreignexchange since it took office in December 2023. In this sense, in April 2025, the BCRA partially liberalized the foreign exchange market with some measures,including, but not limited to, restrictions for individuals to operate in the foreign exchange market have been eliminated, payment terms for foreign tradetransactions have been eased, and paying profits and dividends to foreign shareholders will be allowed starting with financial years beginning in 2025.Simultaneously, the federal government announced a new exchange rate scheme with the following guidelines: (i) the exchange rate will fluctuate within amoving band, between ARS 1,000 and ARS 1,400 (the upper and lower limit of the band will adjust at a rate of -1% and +1% per month, respectively), and theexchange rate will float freely within the bands, without intervention from the BCRA, except to buy Dollars to accumulate reserves, and to sell Dollars in theevent of excessive volatility. As of the issuance date of this financial statements, the so-called gap between the alternative exchange rates and the official ratehas been significantly reduced. Furthermore, the government has sought financing options, and obtained a new US$ 20 billion extended facility for a period of48 months. Labor reforms have also been implemented to flexibilize the management of labor relations and facilitate the regularization of employees. In this context, it is estimated that in 2024, Argentina's GDP contracted by 2.8% as a result of economic policies aimed at achieving macroeconomicstabilization. The cement industry, in particular, contracted by 24% year-on-year, gradually improving from the second half of the year. However, forecasts forthe Argentine economy estimate an approximate GDP growth of 4.5% year-on-year for 2025. The expected recovery will depend on the consolidation of theeconomic model and its ability to generate confidence in its sustainability, thus providing a solid platform to support sustained development. 41. SUBSEQUENT EVENTS The Group has considered events after December 31, 2024, to assess whether it is necessary to recognize or disclose them in these consolidated financialstatements. Such events were assessed through April 29, 2025, the date when the consolidated financial statements were available for issue. 41.1 Annual shareholders’ meeting The annual shareholders’ meeting held on April 23, 2025, approved (i) to allocate the sum of Ps. 153,810 million (in December 31, 2024 currency) to theOptional Reserve for Future Dividends; and (ii) to delegate to the Board of Directors the power to totally or partially release and distribute in cash and/or inkind, one or more payments, the amount in constant currency of the Optional Reserve for Future Dividends depending on the evolution of the business and theregulatory restrictions and limitations through the next annual shareholders meeting that will consider the financial statements corresponding to the year endingDecember 31, 2025. F-68