Loma Negra Compañía Industrial Argentina Sociedad Anónima (LOMA) Balance Sheet

The balance sheet has expanded significantly in nominal terms, driven by hyperinflationary restatement rather than organic growth. Equity increased from $496.6B to $1.3T over the period, but retained earnings swung from $468.7B in 2024Q3 to $51.2B in 2026Q2, indicating that reported equity quality is distorted by non-cash adjustments. This suggests that the balance sheet's expansion may not reflect real value creation, and investors should monitor the trajectory of tangible asset growth relative to inflation.

The D/E ratio has remained below 0.41 over the past ten quarters, which appears conservative, but the absolute debt level has grown from $187.2B to $305.9B. The sharp increase in debt during 2025Q3 to $400.3B, followed by a reduction, may indicate short-term borrowing to manage liquidity under hyperinflation. Given the parent company InterCement's financial distress, the low leverage could reflect constrained access to external financing rather than a deliberate conservative policy. Investors should monitor refinancing risk, especially if inflation persists and local credit conditions tighten.

The balance sheet is dominated by property, plant, and equipment, which is typical for a cement producer, but the rapid growth in PPE is largely due to hyperinflationary restatement. Goodwill has more than doubled, reaching $1.1B, which may indicate acquisitions or revaluation adjustments; however, under IAS 29, these figures are restated and may not reflect real economic value. The high fixed-asset base implies significant maintenance capex requirements, and if real demand contracts, the company could face asset impairment risks. The asset mix suggests a business model that is highly sensitive to construction cycles and energy costs.

The equity base has grown nominally, but the erratic retained earnings line—ranging from $468.7B in 2024Q3 to $51.2B in 2026Q2—indicates that IAS 29 restatements and monetary gains/losses are distorting equity quality. The company has paid negligible dividends and conducted minimal buybacks, as per the cash flow statement, suggesting that capital returns are not a priority. This may reflect the parent company's need to conserve cash, but it also means that shareholders are not receiving direct returns. The equity quality appears weak when adjusted for inflation, and investors should focus on tangible book value rather than reported figures.

The current ratio has strengthened significantly, reaching 2.25, which suggests improved short-term solvency. However, cash and equivalents are only $10.3B, which is small compared to total assets of $2.2T, indicating that the company relies on receivables and inventory for liquidity. Given the hyperinflationary environment, holding cash is costly, but the low cash balance may also reflect limited access to credit or a deliberate strategy to invest in assets. The liquidity buffer appears adequate for now, but investors should monitor the sustainability of the current ratio if working capital swings continue.

Deferred revenue has grown in nominal terms, but the quarterly fluctuations—ranging from $3.6B to $14.4B—reflect the unpredictability of customer prepayments under hyperinflation. The increase in deferred revenue may indicate that customers are locking in prices ahead of expected inflation, but it does not provide reliable forward visibility. The company skipped formal guidance in its latest earnings report, which, combined with volatile deferred revenue, suggests that management itself faces significant uncertainty about future demand. Investors should treat deferred revenue as a weak indicator of future performance in this environment.