Cemex reported higher fourth-quarter sales and net profit Monday as the acquisition of Australia’s Rinker more than compensated a slowdown in the US residential construction market.
Monterrey-based Cemex said in a press release that its net profit rose to US$538 million, or US$0.72 per American depositary receipt, from US$377m or US$0.52 per ADR in the year-ago quarter, helped by monetary and financial gains.
Sales were up 30% at US$5.8bn, while EBITDA, rose 18% to US$1.1bn. Operating profit fell 4% to US$587m.
For the full-year 2007, Cemex reported sales of US$21.7bn and Ebitda of US$4.6bn, up 19% and 11%, respectively.
Cemex’s results - in line with the company’s mid-quarter guidance - were boosted by the US$15.3bn acquisition of Rinker in July, which increased its presence in the US market as well as its exposure to the US housing downturn.
Cemex’s U.S. sales volume for cement fell 1% in the fourth quarter, including the effect of the Rinker buyout. Ready-mix concrete volume grew 54%, and aggregates volume grew 175%. Full-year cement volume fell 8%.
"The decline in sales volumes for the quarter was driven mainly by the continued decline in the residential sector. The correction and eventual recovery of the residential sector in the United States continues to be uncertain," Cemex said.
In Mexico, Cemex reported a 2% increase in cement volume in the fourth quarter, a 4% rise in ready-mix volume, and a 31% increase in aggregates volume. In Spain, cement volume fell 8% from the year-ago period, ready-mix fell 5%, and aggregates fell 6%.
Cement volumes rose 4% in the U.K., while ready-mix volume was flat.
Cemex said it lowered its net debt by $252 million in the fourth quarter, and ended 2007 with net debt of US$18.9bn, equivalent to 3.6 times 12-months Ebitda.
"As we look forward to 2008, and with the integration of Rinker fully completed, we are focused on paying down debt and improving the efficiency of our operations," Cemex said in its release.
Cemex officials said in December that the company aims to reduce costs worldwide by 10%, including an undetermined number of layoffs.