Cemex’ 2003 profit is ahead by 10 per cent

Cemex’ 2003 profit is ahead by 10 per cent
Published: 21 January 2004

Cemex has announced a 9.5 per cent increase in turnover to US$7,164.4m in respect of 2003.  The operating profit at the EBITDA level advanced by 10.0 per cent to US$2,108m and the trading profit (EBIT) improved by 11.1 per cent to US$1,455.2m.  The EBITDA margin is little changed at 29.4 per cent.

Group cement sales rose by 4.6 per cent last year to 64.65Mt, with the increase during the final quarter being slightly weaker at 4.2 per cent increase to 16.271m tonnes.  World-wide deliveries of ready-mixed concrete advanced more strongly at 12.7 per cent to 21.67cu.m, with the final quarter again showing a somewhat slower advance of 11.1 per cent increase to 5.46cu.m. 

The turnover in Mexico rose by 5.9 per cent to US$2,628.5m and the EBITDA advanced 4.7% to US$1,166.3m.  The group’s Mexican operations increased domestic cement deliveries by 4 per cent while export volumes fell by 24 per cent, both numbers being similar to what was recorded in 2002.  The growth in cement demand again came principally from civil engineering and increased housebuilding activity, essentially social housing, while demand from industrial and commercial building activity was broadly stable.  Average grey cement prices increased by two per cent in pesos but declined by four per cent in US dollar terms.  Ready mixed concrete deliveries rose by 13%, but average prices fell by around 2% in local currency and by some 8% in dollar terms. 

In the United States, turnover was 1.0 per cent lower at US$1,718.3m and the EBITDA dropped by 11.7 per cent to US$369.9m and would have been worse had it not been for the pick-up in the final quarter.  In spite of higher volumes over the year, with cement deliveries some two per cent higher and ready-mixed concrete deliveries growing at twice that rate.  Prices were off by around two per cent in cement but were stable in the group’s ready-mixed concrete operations.  The fourth quarter was strong, notably roads and housebuilding and the decline in the commercial and industrial eased.  That gave rise to increases in cement and ready-mixed concrete volumes of around 10 per cent and 11 per cent respectively during the October to December period, as a result of which turnover and EBITDA rose by 13.6% and 15.4% respectively in the fourth quarter.

In Spain, Cemex only operation in Europe, the turnover registered a 23.5 per cent increase to US$1,195.4m as the US dollar fell against the euro.  The EBITDA rose by 16.3 per cent to US$339.1m, however, in local currency terms, turnover is Spain increased by just 3.0 per cent, to €944.4m, while the EBITDA fell by 3.3 per cent to €267.8m.  Domestic cement deliveries rose by around five per cent in a buoyant construction market, carried above all by the civil engineering and residential markets, and a similar volume increase was seen by the ready-mixed concrete business.  Average prices over the year declined by about one per cent in cement but improved by some two per cent for ready-mixed concrete.  Because of the strength of the domestic market, cement exports continued to decline and dropped by a further 21 per cent in 2003.