GCC’s domestic expansion options limited

GCC’s domestic expansion options limited
Published: 09 September 2004

Mexican Cement maker Grupo Cementos de Chihuahua’s limited expansion opportunities in Mexico and dependence on operations in Chihuahua state hinder its credit rating, Standard & Poor’s analyst José Coballasi told BNamericas.  Cemex is one of the Cementos Chihuahua’s most important shareholders, and as Mexico’s industry has been dominated by relatively large groups, which means achieving a domestic acquisition could be difficult," he said.  In a bid to reduce its dependence on Chihuahua’s economy, GCC has some "interesting" investment plans in the US, Coballasi said. In addition to GCC’s four operations in Chihuahua state, the company holds another four in the US.

GCC reported 175mn pesos (US$15m) in net profit in the second quarter 2004, up 3% year-on-year as sales grew while financing costs and taxes payable fell. Net sales totaled 1.03bn pesos second quarter this year, up 9.7% from same-period year ago as Mexican and US sales grew 4.5% and 15.5% respectively to roughly 515mn pesos each.