A stage cementing tool for a wellbore comprises a tool body defining a flow port in a wall thereof. The tool body and wellbore define an annulus therebetween. A setting sleeve compresses a packer element as it moves from the first to the second position. The packer element expands radially outwardly to engage the wellbore as a result of the compression applied by the setting sleeve. A pump-out plug in the tool body is expellable into the annulus upon the application of pressure in the tool body after the packer element engages the wellbore.