Cementos Pacasmayo A : Otros Hechos De Importancia

Cementos Pacasmayo S.A.A. and Subsidiaries

Unaudited interim condensed consolidated financial statements as of September 30, 2023 and for the three and nine-month periods then ended

Firmado Digitalmente por:

CARLOS JOSE MOLINELLI MATEO Fecha: 25/10/2023 06:10:30 p.m.

Cementos Pacasmayo S.A.A. and Subsidiaries

Unaudited interim condensed consolidated financial statements as of September 30, 2023 and for the three and nine-month periods then ended

Content

Report on review of interim condensed consolidated unaudited financial statements

Interim condensed consolidated unaudited financial statements

Interim condensed consolidated unaudited statements of financial position Interim condensed consolidated unaudited statements of profit or loss

Interim condensed consolidated unaudited statements of other comprehensive income Interim condensed consolidated unaudited statements of changes in equity

Interim condensed consolidated unaudited statements of cash flows

Notes to the interim condensed consolidated unaudited financial statements

Tanaka, Valdivia & Asociados

Sociedad Civil de R. L

Report on review of interim condensed consolidated unaudited financial statements

To the Board of Directors and Shareholders of Cementos Pacasmayo S.A.A.

Introduction

We have reviewed the accompanying interim condensed consolidated unaudited statement of financial position of Cementos Pacasmayo S.A.A. (a Peruvian company) and its Subsidiaries (together the "Group") as of September 30, 2023, and the related interim condensed consolidated unaudited statements of profit or loss, other comprehensive income, changes in equity and cash flows for the three and nine-month periods then ended, and explanatory notes. Management is responsible for the preparation and presentation of these interim condensed consolidated unaudited financial statements in accordance with IAS 34 Interim Financial Reporting (IAS 34). Our responsibility is to express a conclusion on these interim condensed consolidated unaudited financial statements based on our review.

Scope of review

We conducted our review in accordance with International Auditing Standard on Review Engagements (ISRE) 2410, Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of interim financial information consists of making inquiries, primarily of the persons responsible for financial and accounting matters and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim condensed consolidated unaudited financial statements are not prepared, in all material respects, in accordance with IAS 34.

Lima, Peru

October 25, 2023

Countersigned by:

Manuel Arribas Zevallos

C.P.C. Register No. 45987

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Cementos Pacasmayo S.A.A. and Subsidiaries

Interim condensed consolidated unaudited statements of financial position

As of September 30, 2023 (unaudited) and December 31, 2022 (audited)

			As of		As of
		September	December,
	Note	30, 2023		2022
			S/(000)		S/(000)
Assets
Current assets
Cash and cash equivalents	3	177,124		81,773
Term deposits with maturity greater than ninety days	3	8,500		-
Derivative financial instruments	15	-		86,893
Trade and other receivables	4	96,078		101,491
Income tax prepayments		4,369		8,268
Inventories	5	817,685		884,969
Prepayments		21,595		25,059
		__________		__________
Total current asset		1,125,351		1,188,453
		__________		__________
Non-current assets
Trade and other receivables	4	43,928		43,543
Financial instruments designated at fair value through
other comprehensive income	15	274		274
Property, plant and equipment	6	2,151,371		2,007,838
Intangible assets		60,882		56,861
Goodwill		4,459		4,459
Deferred income tax assets		11,220		9,005
Right of use asset	7	6,470		3,639
Other assets		78		89
		__________		__________
Total non-current assets		2,278,682		2,125,708
		__________		__________
Total assets		3,404,033		3,314,161
		__________		__________
Liability and equity
Current liabilities
Trade and other payables	8	277,535		284,554
Financial obligations	9 and 15	345,146		618,907
Lease liabilities	7	3,184		2,005
Income tax payable		9,159		16,340
Provisions	10	56,120		31,333
		__________		__________
Total current liabilities		691,144		953,139
		__________		__________
Non-current liabilities
Financial obligations	9 and 15	1,228,637		974,264
Lease liabilities	7	3,804		2,350
Non-current provisions	10	20,675		47,638
Deferred income tax liabilities		130,082		141,635
		__________		__________
Total non-current liabilities		1,383,198		1,165,887
		__________		__________
Total liability		2,074,342		2,119,026
		__________		__________
Equity
Capital stock		423,868		423,868
Investment shares		40,279		40,279
Investment shares held in treasury		(121,258)	(121,258)
Additional paid-in capital		432,779		432,779
Legal reserve		168,636		168,636
Other accumulated comprehensive loss		(16,272)	(17,787)
Retained earnings		401,659		268,618
		__________		__________
Total equity		1,329,691		1,195,135
		__________		__________
Total liability and equity		3,404,033		3,314,161
			__________			__________

The accompanying notes are an integral part of the interim condensed consolidated unaudited financial statements.

Cementos Pacasmayo S.A.A. and Subsidiaries

Interim condensed consolidated unaudited statements of profit or loss

For the three and nine-month periods ended September 30, 2023 and September 30, 2022 (unaudited)

		For the three-month period	For the nine-month period
			ended September 30,		ended September 30,
	Note	2023		2022		2023		2022
			S/(000)	S/(000)		S/(000)		S/(000)
Sales of goods	12	516,664	553,556	1,438,698	1,581,851
Cost of sales		(342,025)	(387,695)	(950,886)	(1,092,943)
		_________	_________	_________	_________
Gross profit		174,639	165,861	487,812	488,908
		_________	_________	_________	_________
Operating expense
Administrative expenses		(55,099)	(58,149)	(171,155)	(166,399)
Selling and distribution expenses		(17,689)	(17,242)	(50,897)	(51,237)
Other operating expense, net		(10,290)	(688)	(8,814)	(2,023)
		_________	_________	_________	_________
Total operating expenses, net		(83,078)	(76,079)	(230,866)	(219,659)
		_________	_________	_________	_________
Operating profit		91,561	89,782	256,946	269,249
		_________	_________	_________	_________
Other income (expenses)
Finance income		2,063	855	4,254	2,425
Finance costs		(26,907)	(24,999)	(76,784)	(71,607)
Net profit (loss) for valuation of trading
derivative financial instruments	15(a)	-	62	19	(2)
Gain (loss) from exchange difference, net		376	(1,832)	5,717	(1,481)
		_________	_________	_________	_________
Total other expenses, net		(24,468)	(25,914)	(66,794)	(70,665)
		_________	_________	_________	_________
Profit before income tax		67,093	63,868	190,152	198,584
Income tax expense	11	(20,978)	(19,667)	(57,111)	(60,679)
		_________	_________	_________	_________
Profit for the period		46,115	44,201	133,041	137,905
		_________	_________	_________	_________
Earnings per share
Basic profit for the period attributable to
equity holders of common shares and
investment shares of the parent (S/ per
share)	14	0.11		0.10		0.31		0.32

The accompanying notes are an integral part of the interim condensed consolidated unaudited financial statements.

Cementos Pacasmayo S.A.A. and Subsidiaries

Interim condensed consolidated unaudited statements of other comprehensive income

For the three and nine-month periods ended September 30, 2023 and September 30, 2022 (unaudited)

		For the three-month period	For the nine-month period
			ended September 30,		ended September 30,
	Note	2023	2022		2023		2022
			S/(000)		S/(000)		S/(000)	S/(000)
Profit for the period		46,115	44,201	133,041	137,905
		_________	_________	_________	_________
Other comprehensive income
Other comprehensive income to be
reclassified to profit or loss in
subsequent periods:
Net gain on cash flow hedges	15(a)	-	1,256	2,154	1,647
Deferred income tax	11	-	(370)	(634)	(486)
		_________	_________	_________	_________
Other comprehensive income for the
period, net of income tax		-	886	1,520	1,161
		_________	_________	_________	_________
Total comprehensive income for the
period, net of income tax		46,115	45,087	134,561	139,066
			_________		_________	_________	_________

The accompanying notes are an integral part of the interim condensed consolidated unaudited financial statements.

Cementos Pacasmayo S.A.A. and Subsidiaries

Interim condensed consolidated unaudited statements of changes in equity

For the nine-month period ended September 30, 2023 and September 30, 2022 (unaudited)

													Unrealized loss
													on financial	Unrealized
					Investments						instruments	gain (loss) on
	Capital	Investment	shares held in	Additional	Legal	designated at		cash flow	Retained	Total
	stock		shares		treasury	paid-in capital	reserve		fair value		hedge	earnings	equity
	S/(000)		S/(000)		S/(000)		S/(000)	S/(000)		S/(000)		S/(000)	S/(000)	S/(000)
Balance as of January 1, 2022	423,868	40,279	(121,258)	432,779	168,636	(15,869)	(4,225)	271,595	1,195,805
Profit for the period	-	-	-	-	-	-	-	137,905	137,905
Other comprehensive income for the period, net of
income tax	-	-	-	-	-	-	1,161	-	1,161
	__________	__________	__________	__________	__________	__________	__________	__________	__________
Total comprehensive income	-	-	-	-	-	-	1,161	137,905	139,066
	__________	__________	__________	__________	__________	__________	__________	__________	__________
Balance as of September 30, 2022	423,868	40,279	(121,258)	432,779	168,636	(15,869)	(3,064)	409,500	1,334,871
	__________		__________	__________	__________	__________	__________	__________	__________	__________
Balance as of January 1, 2023	423,868		40,279	(121,258)	432,779	168,636	(16,267)	(1,520)	268,618	1,195,135
Profit for the period	-	-	-	-	-	-	-	133,041	133,041
Other comprehensive income for the period, net of
income tax	-	-	-	-	-	-	1,520	-	1,520
Others	-	-	-	-	-	(5)	-	-	(5)
	__________	__________	__________	__________	__________	__________	__________	__________	__________
Total comprehensive income	-	-	-	-	-	(5)	1,520	133,041	134,556
	__________	__________	__________	__________	__________	__________	__________	__________	__________
Balance as of September 30, 2023	423,868	40,279	(121,258)	432,779	168,636	(16,272)	-	401,659	1,329,691
	__________		__________	__________	__________	__________	__________	__________	__________	__________

The accompanying notes are an integral part of the interim condensed consolidated unaudited financial statements.

Cementos Pacasmayo S.A.A. and Subsidiaries

Interim condensed consolidated unaudited statements of cash flows

For the three and nine-month period ended September 30, 2023 and September 30, 2022

		For the three-month period	For the nine-month period
	Note	ended September 30	ended September 30
		2023	2022	2023	2022
		S/(000)	S/(000)	S/(000)	S/(000)
Operating activities
Profit before income tax		67,093	63,868	190,152	198,584
Non-cash adjustments to reconcile
profit before income tax to net
cash flows :
Depreciation and amortization		37,377	34,959	105,283	103,621
Finance costs		26,907	24,999	76,784	71,607
Long-term incentive plan	13	1,854	2,235	5,775	6,039
Estimate expected credit loss	4	231	-	1,746	1,893
Net (gain) loss on the settlement of
trading derivative financial
instruments	15(a)	-	(62)	(19)	2
Unrealized exchange difference
related to monetary transactions		(725)	(3,927)	(545)	295
Net gain on disposal of property,
plant and equipment	6	(308)	(53)	(695)	(460)
Finance income		(2,063)	(855)	(4,254)	(2,425)
Other operating, net		1,100	2,428	2,940	3,345
Working capital adjustments
(Increase) decrease in trade and
other receivables		(5,401)	(20,603)	1,866	(11,674)
Decrease (increase) in prepayments		4,783	(8,194)	(580)	(22,933)
Decrease (increase) in inventories		111,814	(92,610)	65,669	(209,102)
Increase in trade and other
payables		59,916	45,770	4,322	60,406
		_________	_________	_________	_________
		302,578	47,955	448,444	199,198
Interests received		2,133	1,900	4,194	3,188
Interests paid		(31,642)	(35,447)	(77,768)	(72,761)
Income tax paid		(25,212)	(16,987)	(78,938)	(68,087)
		_________	_________	_________	_________
Net cash flows provided (used in) by
operating activities		247,857	(2,579)	295,932	61,538
		_________	_________	_________	_________

Interim condensed consolidated statements of cash flows (continued)

	For the three-month period	For the nine-month period
Note	ended September 30,	ended September 30,
	2023	2022	2023	2022
	S/(000)	S/(000)	S/(000)	S/(000)
Investing activities
Purchase of property, plant and
equipment	(94,885)	(56,239)	(243,598)	(95,155)
Purchase of intangible assets	(3,577)	(4,438)	(10,940)	(9,590)

Loans to third parties		(702)	-	(1,202)	(141)
Opening of term deposits with original
maturity greater than 90 days		(8,500)	-	(18,500)	-
Collection of loan to third parties		-	-	150	149
Proceeds from sale of property, plant and
equipment		536	398	1,221	1,519
Redemption of term deposits with original
maturity greater than 90 days		10,000	-	10,000	-
		_________	_________	_________	_________
Net cash flows used in investing
activities		(97,128)	(60,279)	(262,869)	(103,218)
		_________	_________	_________	_________
Financing activities
Loan paid	9	(39,091)	(69,984)	(546,429)	(228,984)
Bank overdraft paid		-	-		(85,333)	-
Payment of hedge finance cost		-	(7,708)	(7,708)	(15,390)
Payment of lease liabilities	7	(935)	(628)	(2,322)	(1,821)
Dividends paid		(127)	(135)	(583)	(774)
Loan received	9	-	70,000	525,000	229,000
Income from settlement of derivative
financial instrument		-	-	93,323	-
Bank overdraft		-	-	85,333	-
Dividends returned		163	2	462	172
		_________	_________	_________	_________
Net cash flows provided by (used in)
financing activities		(39,990)	(8,453)	61,743	(17,797)
		_________	_________	_________	_________
Net increase (decrease) in cash and cash
equivalents		110,739	(71,311)	94,806	(59,477)
Net foreign exchange difference		725	4,971	545	(2,275)
Cash and cash equivalents at the
beginning of the period		65,660	277,990	81,773	273,402
		_________	_________	_________	_________
Cash and cash equivalents at the end of
the period	3	177,124	211,650	177,124	211,650
		_________	_________	_________	_________
Transactions with no effect in cash flows:
Unrealized exchange difference related to
monetary transactions		(725)	(3,927)	(545)	295
Outstanding accounts payable related to
acquisition of property, plant and
equipment as of September 30	6	1,104	1,995	12,140	8,022
Recognition of right-of-use assets and				-
lease liabilities during the period	7	4,829	4,829	305

The accompanying notes are an integral part of the interim condensed consolidated unaudited financial statements.

Cementos Pacasmayo S.A.A. and Subsidiaries

Notes to interim condensed consolidated unaudited financial statements

As of September 30, 2023 and 2022, and December 31, 2022

1. Economic activity
2. 1. Economic activity -
      Cementos Pacasmayo S.A.A. (hereinafter "the Company") was incorporated in 1957 and, in accordance with the Law of Peruvian Companies, is an open stock corporation, its shares are listed in the Lima and New York Stock Exchange. The Company is a subsidiary of Inversiones ASPI S.A., which holds 50.01 percent of the Company's common shares as of September 30, 2023, December 31, 2022 and September 30, 2022.
      The address registered by the Company is Calle La Colonia No.150, Urbanización El Vivero, Santiago de Surco, Lima, Peru.
      The main activity of the Company is the production and commercialization of cement, precast, concrete and quicklime in the northern region of Peru.
      The interim condensed consolidated unaudited financial statements of the Company and its subsidiaries (hereinafter the "Group") as of September 30, 2023 and for the nine-month period then ended, were approved for issuance by the Company's Management on October 25, 2023. The consolidated audited financial statements as of December 31, 2022 have been approved by the General Meeting of Shareholders, on March 24, 2023.
3. Basis of preparation and changes to the Group's accounting policies

2.1 Basis of preparation -

The interim condensed consolidated unaudited financial statements of the Group have been prepared in accordance with IAS 34 Interim Financial Reporting as issued by the International Accounting Standards Board (IASB) and have been prepared on a historical cost basis, except for financial instruments designated at fair value through other comprehensive income (OCI) and derivatives financial instruments that have been measured at fair value. The interim condensed consolidated unaudited financial statements are presented in soles and all values are rounded to the nearest thousand (S/000), except when otherwise indicated. The Group has prepared the financial statements on the basis that it will continue to operate as a going concern. The Management consider that there are no material uncertainties that may cast doubt significant doubt over this assumption. They have formed a judgement that there is a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future, and not less than 12 months from the end of the reporting period.

The interim condensed consolidated unaudited financial statements do not include all the information and disclosures required in the annual financial statements and should be read in conjunction with Group's annual consolidated financial statements as of December 31, 2022.