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Report for Q1 2011


     For Q1 2011, Cementos Argos obtained more than COP 787 thousand million (USD
     419 million) in consolidated revenues, showing a growth of 13% in pesos or 16% in

     Consolidated operating earnings came to COP 48 thousand million (USD 25 million)
     again showing a growth of 10% in pesos or 13% in dollars.

     Consolidated EBITDA totaled more than COP 139 thousand million (USD 74 million)
     showing a growth of 13% in pesos or 17% in dollars. The Company’s EBITDA margin
     for Q1 remained stable at 18%.

     The Company’s consolidated net income came to COP 29 thousand million (USD 15
     million), which was slightly below those obtained for the same period last year, that is
     to say COP 33 thousand million (USD 18 million).

     Assets, on a consolidated basis came to COP 15 billion (USD 8 billion) showing an
     increase of 0% in pesos or 1% in dollars compared to year-end 2010. During this
     same period liabilities rose by 8% in pesos or 10% in dollars, for a total of COP 4
     billion (USD 2 billion). Shareholders´ Equity came to COP 11 billion (USD 6 billion)
     showing an increase of 4% in pesos or 2% in dollars.

Cementos Argos got off to a good start to the year, with the majority of its operating figures
showing increases compared to the first quarter of last year. This was not only due to our
markets picking up steam in both Colombia and the Caribbean, but also to the unwavering
efforts we have been making over the last several months for more efficient, standardized
operations. With this we are striving to become an Organization that is more capable of
responding swiftly to market changes, allowing us to maximize our synergies together with
our sources of operating leverage during the different economic cycles within our areas of
influence both at home and abroad.

Firstly we are pleased with the results obtained in Colombia during this past quarter,
especially the volumes sold in March, which rose to levels never before seen in the history of
our Company, both in terms of tons of cement as well as cubic meters of concrete.

On the other hand, and in spite of the heavy rainfall at the end of last year which affected our
plant in Cartagena, our Caribbean Division obtained an important improvement in its results
for these first three months. Although our cement volumes to the US continue to be affected
by the low demand in this part of the world as well as low prices within the construction
sector, we have managed to ship cement to other export markets besides taking on a larger
portion of the market on the northern coast of Colombia.

Our results in the US continue to mirror the weak performance of the US construction sector,
which also had to contend with adverse weather during the early part of this year. Although
our concrete volumes in the Gulf region and Southeastern part of the US have begun to rise,
compared with last year, market prices per cubic yard continue low in spite of demand finally
beginning to show signs of improvement, mainly due to the scheduled investment in


Our Colombia Division posted quite gratifying results for this first quarter. For several
months now we have been talking of rising activity in the country´s construction sector
and how Cementos Argos is playing an active role in the different infrastructure projects
that are being carried out. Nevertheless, the results of these past quarters have not
faithfully reflected how the Colombian market is picking up steam, since last year we
had no revenues coming in from our coal export business that we had divested the year
before, and therefore last year´s results cannot be compared with those of 2009. Also,
and as we mentioned in our last teleconference, the results of Q4 2010 although
positive from the revenue and sales standpoints were nevertheless affected by the
adverse weather patterns within the entire region, which in turn had a negative impact
on our margins.

Having said that, however, during these past three months we have worked hard to
further our positioning amongst our clients and have made important investments in
equipment and mobile concrete plants so as to attend the construction projects being
conducted both on an urban and nationwide level. In this way we are consolidating our
leadership of the cement, concrete and aggregate markets in Colombia and becoming
an indisputable ally for the infrastructure projects being carried out throughout the

For Q1 2011, our Colombia Division obtained COP 426 thousand million in revenues for
a growth of 16%. EBITDA reached COP 129 thousand million, rising 16% over and
above the figure for the same period last year. The Division´s EBITDA margin remained
stable at 30%.

It is important to mention that the Colombia Division´s operating margins were affected
by a transport strike early on in the year which had a significant impact on the cost of
transporting the finished product and raw materials; nevertheless, they were still higher
than those obtained for the same period last year. Thanks to the Division´s ongoing
savings initiatives and the optimization of its corporate structure, it was able to
neutralize and overcome the overall effect on its margins.

With regard to sales, volumes of Argos grey cement in Colombia for Q1 2011 came to
1,2 million tons, showing a YoY increase of 27%. Out of this entire volume and as you
requested at our last quarterly teleconference, Cementos Argos sold 197 thousand tons
of cement through its subsidiary Concretos Argos; that is to say 17% of the total amount
of cement sold by Argos in Colombia was shipped via our concrete business.

Concrete sales in Colombia came to 587 thousand cubic meters, showing an increase of
48% compared to the same period last year.

In March as well as for the entire first quarter of this year, Cementos Argos reached a
historic milestone, with cement and concrete sales reaching the highest levels ever
recorded by this Division.

Based on the above, we continue to uphold a positive outlook for the Colombian market,
since besides the momentum gained over the last few months by the civil engineering
and infrastructure subsector, we also are seeing incipient signs of rising activity with the
building and minor construction subsector

This is mirroring an important increase in building permits being issued in this country
over the last few months. Land being approved for construction purposes on a monthly
basis, as reported by the Colombian Statistics Bureau (DANE) has risen by a YoY 50%
over the last three months (December 2010 to February 2011). Upon calculating the
amount of land for which building permits have been issued during the 12 month-period
ending February 28, 2011, we see a 40% increase compared with the same period a
year ago.

It is worthwhile noting that although building permits do not necessarily produce sales of
construction materials there and then, they do clearly mark the trend of the market in
the mid- to long-term. This is because construction does not automatically begin as
soon as building permits are issued.

As for the housing market, a record number of new homes were approved in November
and December of last year, with housing for the lower-income brackets playing an all-
important role as the Government brings down the housing deficit in Colombia.
Furthermore, the figures reported for January and February of this year have also gone
beyond the maximum levels recorded for the last 24 months.

The Q1 results for this Division, were far from satisfactory. Not only was it hit hard by
sluggish prices, but also shipments declined due to the adverse weather conditions in
February, mainly in Little Rock, Arkansas and Dallas, Texas, which held up operations
on two occasions for 8 and 3 days respectively.

On a more positive note, during the first quarter in the US we were awarded more than
650 thousand cubic meters of concrete to be shipped over the next few months to
various infrastructure projects. These include the North Tarrant Expressway, costing
USD 2 billion, where Argos shall be supplying 25% of the concrete required, for a total
of 100 thousand cubic meters. Also we were hired to supply 30% of the concrete
required by the second largest highway concession in the US, the Lyndon B. Johnson
Freeway, costing USD 3 billion which shall require a total 765 thousand cubic meters of
concrete. Both of these projects are being built in Texas, which at December 2010 still
had 46% of the stimulus funds provided by the ARRA to spend on infrastructure.

In response to the interesting amount of activity going on in the US civil engineering
sector, mainly in our own areas of influence, in January 2011 we created a new
Infrastructure and Special Projects Area within our US Division so as to better cater to
the different infrastructure projects that are scheduled for this part of the world. This
forms part of a wider sales and market positioning strategy, given the changes in our
sales mix for this sector, where infrastructure is set to be the main source of demand, in
contrast with just a slight rise with the housing sector.

During the first quarter of this year, we sold in the US 828 thousand cubic meters of
concrete, showing a 3% increase compared to 2010. The Division´s revenues
consequently reached USD 84 million, showing a 6% decline compared to the same
period last year. The Division posted a negative EBITDA of USD 6 million.

In addition to lower margins given the drop in average selling prices and the disruptions
in operations caused by adverse weather conditions, it is important to note that although
we had forecast a 6% increase in fuel prices at the beginning of the year, this based on
the figures forecast by the Energy Information Administration, in just the first three
months of this year, diesel and other fuels rose by more than 18%, which is exerting
greater pressure on the Division’s margins.
Nevertheless we remain firm to our long-term strategy and vision for the US, in spite of
the economic slowdown in this part of the world having taken longer than initially
expected, which is why we do not feel comfortable committing ourselves to certain
targets and forecasts However, it is vital that our shareholders and investors realize
that our day-to-day performance in the US offers constant challenges in terms of
maximizing efficiencies and focusing our sales efforts on gaining greater ground on
what has after all become a very difficult market. Having said that however, we are
convinced that the US market shall recover the drive it enjoyed in the past, this sooner
rather than later. Although these last two years have been difficult, thanks to initiatives
such as having centralized the Division´s administrative operations in one single
operations center in Houston, Texas, creating new sales areas and detecting new
market niches, Cementos Argos has now built up sufficiently robust operating
capabilities in the region, and with its ongoing financial stability, can afford to weather
the current difficulties while the country´s construction materials market begins to
recover slowly but surely.


In spite of a difficult year-end 2010 for the Caribbean Division with numerous disasters
caused by the heavy rainfall in November and December, it managed to post a positive
level of results with important increases in terms of its volumes, margins and financials.

Firstly, and we are very pleased to report that as of January 2011 we began to ship
cement and pozzuolana for the widening of the Panama Canal, shipments which
according to the consortium in charge of the project, shall continue until early 2014. We
would like to remind you that this material is supplied from our Cartagena Plant along
with clinker and from our grinding facilities in Panama the actual finished product is
shipped to the contractor. As a result of this, month by month our new production line in
Cartagena has been producing more and becoming much more stable from the
operational standpoint, running at 95% of its nominal capacity at the end of Q1 2011,
that is to say 1.8 million tons a year.

Generally speaking, the three main markets attended by the Caribbean Division
performed well. Firstly in Panama, cement sales rose by 15%, driving up revenues and
EBITDA by 18% and 40% respectively. On the other hand, cement sales in the
Dominican Republic and Haiti rose by 15% and 40% respectively, however, the basis for
comparison for this latter country was affected by last year´s earthquake. In both
countries, revenues rose by 7% and 39%, with EBITDA running at -12% and 59%
respectively. This drop in EBITDA in the case of the Dominican Republic was mainly
due to higher distribution costs, after transport costs went up increasing domestic
haulage by 2 dollars a ton.

Outlook for this Division remains good, this based on an interesting amount of activity in
the construction material sector throughout the region. We hope that the President elect
of Haiti shall be able to commence his reconstruction plan without delay. Also, current
prospects show that Panama and the Dominican Republic are on a firm path to
economic growth, this bolstered by foreign direct investment, its external demand and
the construction sector itself. In fact, according to its latest Global Economic Outlook
report, the IMF is expecting growth rates in this part of the world of 4.2% and 4.5% for
2011 and 2012 respectively It is worthwhile mentioning that a large part of this growth
is due the robust performance of the Dominican Republic and the reconstruction efforts
in Haiti. If we were to exclude these countries the growth forecast for the Caribbean
Division for 2011 would come to just 2.2%.

For Q1 2011, the Caribbean Division posted consolidated revenues of USD 98 million
for a growth of 44% compared to the same period last year. EBITDA, on the other hand
went from USD 14 million in 2010 to USD 23 million for this past quarter, representing a
total growth of 65%. The Division´s EBITDA margin rose to 23% compared to 20% for
the same period last year.


For Q1 2010, we obtained COP 20 thousand million in revenue from our Other
Businesses, which was lower than the COP 25 thousand million posted last year.
EBITDA therefore came to COP XXX thousand million, which was COP 3 thousand
million less than last year.

It is important to note that the results obtained from our Other Businesses are largely
dependent on the Company's real estate business. As to be expected, although our
horizontal land development business is already up and running and has its own
exclusively dedicated personnel, it nonetheless depends on sporadic transactions and
not a regularly recurring flow of such. This is the main reason for the decline in the
operating figures for our Other Businesses.
The following table contains a summary of the main indicators posted by all three Divisions
for Q1 2011.

                                                                            YTD at March

                                                Revenues                                                 EBITDA

                                    2011          2010        Var (%)      2011         Mgn (%)           2010          Mgn (%)        Var (%)
COP$ thousand million

Colombia                            426           368           16         129           30.3             111            30.1            16

United States                       158           174           -9         -11            -7.1             -1             -0.8          -694

The Caribbean                       184           132           39         43            23.3              27            20.3            60

Sub-total                           767           674           14         161           20.9             136            20.2            18

Overhead                             0             1            -94        -23            N/A             -18             N/A            26

Other Businesses                    20             25           -20         1             4.0              4             15.7            -80

Consolidated                        787           699           13         139           17.6             122            17.5            13

US$ million

Colombia                            227           189           20         68            30.2              57            30.1            20

United States                       84             90           -6          -6            -7.1             -1             -0.8          -787

The Caribbean                       98             68           44         23            23.3              14            20.4            65

Corp. & Other Business, Net         11             13          -19         -12           -109.4            -7            -54.2          -63

Consolidated                        419           360           16         74            17.6              63            17.5            17


                                                                      +3                                                         +41           293
 300                                     (10)
                249                                                             (22)
                                                                                             (20)                (4)





            Cash at      EBITDA          WK        CAPEX          Taxes     Financial   Dividends, net     Other non-     Financing        Cash at
            Dec. 10                                                         Expense                        operating      Operations       Mar. 11

At the end of 2011, Cementos Argos’ investment portfolio came to COP 6.1 billion.

For more information on our portfolio of investments please refer to the presentation of
our Q1 2011 results published on Cementos Argos’ Investor Website, under the tab
“Communications / Presentations”


At March 31, 2011, Cementos Argos´ consolidated net debt came to COP 2.4 billion, 72% of
which was denominated in pesos and the remaining 28% in dollars.

The average annual cost of debt in pesos came to 6.4% at the end of Q1 2011 while that in
dollars reached 2%

On a consolidated basis, coverage continues at adequate levels as can be seen in the
following ratios: Net Indebtedness / EBITDA + Dividends: 3.7; EBITDA / Financial Expense:
3.2 times and Net Indebtedness / Equity: 22%.

1 Fluctuations in the portfolio of non-cement investments did not affect Cementos Argos' income statement, however they did
affect its balance sheet, specifically the appreciation /depreciation account. All these non-cement companies periodically report
their results and for this reason the corresponding information is not included in this report.
A teleconference shall be broadcast over the Internet next Monday May 2 at 8 a.m. Colombian time, at
which we shall be discussing our Q1 results.

Conference ID: 61.436.211
Tel – United States / Canada:         (866) 837 - 3612

Tel - Colombia:                        01800.518.01.65

Tel - International/Local:            (706) 634 - 9385

This conference shall be rebroadcast on Tuesday May 3 Tels: (800) 642-1687 and (706) 645-9291.

A more detailed presentation of these results has been made available on Cementos Argos’ Investor
Webpage ( in the section Communications / Presentations

Tomás Uribe
Investor Relations
Cementos Argos
Tel: (574) 319.87.12
                                             CEMENTOS ARGOS S.A.
                                       CONSOLIDATED P&L STATEMENT
                                                        YTD at
                                     In m illions of Colom bian pesos or US dollars

                                                                    Mar-11            Mar-10    Var. (%)

Operating revenues                                                 787,451            699,442      12.6
US$ Dollars                                                             419              360       16.4

Variable costs                                                     650,289            563,944      15.3
 Cost of goods sold                                                573,013            504,544      13.6
 Depreciation and amortization                                      77,276             59,400      30.1

Gross profit                                                       137,162            135,498       1.2
Gross Margin                                                        17.4%              19.4%

Overheads                                                           89,350             92,172       -3.1
 Administrative expense                                             54,854             49,384      11.1
 Selling expense                                                    21,043             23,321       -9.8
 Depreciation and amortization                                      13,453             19,467      -30.9

Operating Profit                                                    47,812             43,326      10.4
US$ Dollars                                                           6.1%              6.2%

EBITDA                                                             138,541            122,193      13.4
US$ Dollars                                                              74               63       17.0
EBITDA Margin                                                       17.6%              17.5%

Non-operating revenues                                              88,668             92,494       -4.1
 Dividends and participations                                       70,296             70,714       -0.6
 Profits from sales of investments                                   3,158                 0        n.a.
 Other income                                                       15,214             21,780      -30.1

Non-operating expense                                               99,647             98,711       0.9
 Net financial expense                                              41,282             43,480       -5.1
 Losses (profits) on sales of fixed assets                            (469)              766     -161.2
 Other expense                                                      58,834             54,465       8.0

Exchange difference                                                  1,207              2,241      -46.1

Pre-tax earnings                                                    38,040             39,350       -3.3

Provision for income tax and deferred tax                            5,891              3,451      70.7
Minority interest                                                    3,148              3,004       4.8

Net Income                                                          29,001             32,895      -11.8
US$ Dollars                                                              15               18       -16.1
Net Margin                                                           3.7%               4.7%
                                                   CEMENTOS ARGOS S.A.
                                             CONSOLIDATED BALANCE SHEET
                                         In millions of Colombian pesos or US dollars

                                                                            Mar-11         Dec-10    Var. (%)

Cash, banks and negotiable investments                                      550,960       476,130       15.7
Trade receivables                                                           388,491       381,922        1.7
Accounts receivable, net                                                    403,450       305,951       31.9
Inventories                                                                 318,174       289,475        9.9
Prepaid expense                                                              20,916        23,617       -11.4

CURRENT ASSETS                                                            1,681,991      1,477,095      13.9

Permanent investments                                                       334,077       340,108        -1.8
Accounts receivable                                                          40,849        38,230        6.9
Inventories                                                                  39,412        39,412        0.0
Deferred items and intangibles                                            1,600,270      1,634,481       -2.1
Property, plant and equipment, net                                        2,804,050      2,870,683       -2.3
Valuations                                                                8,873,107      9,036,539       -1.8
Other assets                                                                 22,026        44,319       -50.3
NON-CURRENT ASSETS                                                      13,713,791      14,003,772       -2.1
TOTAL ASSETS                                                            15,395,782      15,480,867       -0.5
US$ Dollars                                                                   8,192         8,088        1.3

Financial obligations                                                       690,516       682,182        1.2
Commercial paper                                                            199,030       250,000       -20.4
Suppliers and accounts payable                                              414,517       398,389        4.0
Dividends payable                                                           163,958        47,778      243.2
Taxes and rates                                                             202,504        46,445      336.0
Labor liabilities                                                           101,071        36,419      177.5
Sundry creditors                                                             49,196        54,582        -9.9
Other liabilities                                                           266,884       249,145        7.1

CURRENT LIABILITIES                                                       2,087,676      1,764,940      18.3

Financial obligations                                                       797,589       700,167       13.9
Labor liabilities                                                           225,788       224,990        0.4
Deferred items                                                               96,571       160,869       -40.0
Bonds outstanding                                                         1,240,000      1,240,000       0.0
Bond placement premium                                                      -11,084        -11,494       3.6
Sundry creditors                                                            134,382       136,850        -1.8
NON-CURRENT LIABILITIES                                                   2,483,246      2,451,382       1.3
TOTAL LIABILITIES                                                         4,570,922      4,216,322       8.4
US$ Dollars                                                                   2,432         2,203       10.4

MINORITY INTEREST                                                            73,711        88,468       -16.7
US$ Dollars                                                                      39            46       -15.2

SHAREHOLDERS´ EQUITY                                                    10,751,149      11,176,077       -3.8
US$ Dollars                                                                   5,720         5,839        -2.0

TOTAL LIABILITIES + SHAREHOLDERS' EQUITY                                15,395,782      15,480,867

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