Mexico’s Cemex eyes China, India, Brazil, Russia

Mexico’s Cemex eyes China, India, Brazil, Russia
Published: 28 April 2006

Cemex has reportedly set its sights set on new business in four of the world’s largest nations – China, India, Russia and Brazil. 
Chairman Lorenzo Zambrano told a news conference on Thursday that because of their size the nations have enormous future potential, but for the moment Cemex does not have anything firm in mind. 
"In the countries which investors collectively called BRIC – Brazil, Russia, India and China – we have no presence, so that is an opportunity for us in the future," Zambrano said. Cemex already operates in more than 50 countries. 
After concentrating on paying down debt since the RMC purchase, Cemex is now below its so-called "cruising speed" of 2.7 times net debt to EBITDA ratio. EBITDA is earnings before interest, taxes, amortization and depreciation. 
Zambrano said Cemex will reduce debt further if no acquisition opportunities arise. 
 "We have said that our average debt to EBITDA ratio is 2.7 times ... and in the first quarter we hit 2.3 times and we are going to go down to 2 times if we do not find anything interesting to buy," Zambrano said. 
Cemex for the moment is expanding in core established markets. This year it has earmarked $500 million to increase plant capacity, both in Mexico and the United States. 
The United States has become Cemex’s top market with the acquisition of RMC, surpassing business in its home Mexican base. 
"The United States is the biggest business unit that we have now," Zambrano said. "We expect EBITDA from the United States this year to outstrip Mexico."