Cemex Latin American Holdings held back by weaker cement sales in Colombia

Cemex Latin American Holdings held back by weaker cement sales in Colombia
Published: 24 April 2015


Cemex Latin American Holdings' turnover declined by 16.3 per cent in first quarter of the year to US$353.8m and EBITDA fell by 20.3 per cent to US$112.4m. At the trading level there was a 23.6 per cent reduction to US$90.2m.

After an interest charge 15.6 per cent lower at US$20.6m and other items, the pre-tax profit declined by 23.3 per cent to US$72.3m and the net attributable profit came off by 19.8 per cent to US$43.8m. Net debt at the end of March was 8.8 per cent lower than a year earlier at US$1125m, giving a gearing level of 86.3 per cent, down from 91.2 per cent a year earlier.

Cement shipments in the quarter were 11.5 per cent lower at 1.74Mt, of which grey cement sales into the domestic markets accounted for 1.59Mt, or 91.6 per cent of the total. Aggregates sales were 8.5 per cent higher at 2.11Mt, while the ready-mixed concrete deliveries increased by 3.5 per cent to 0.85Mm³.

Colombian turnover declined by 27.3 per cent to US$176.2m, but the drop in the EBITDA was higher at 37.8 per cent to US$59.3m. Cement shipments were off by 15 per cent compared with a 34 per cent rise a year ago and some market share was lost as prices were increased. Aggregates volume advanced by five per cent and ready-mixed concrete deliveries were also five per cent ahead. Prices were one per cent lower in cement and in aggregates, but improved by three per cent in ready-mixed concrete. Housebuilding activity continued to increase and industrial and commercial remained strong while several highway projects ensured a fair level of infrastructure spending.

In Panama, the turnover came off by 5.5 per cent to US$71.9m and the EBITDA declined by 11.4 per cent to US$28.7m as the EBITDA margin came back further to 39.9 per cent from a very high 46.8 per cent in 2013. Cement shipments increased by nine per cent as deliveries to the Panama Canal expansion project increased, but the dollar-denominated price eased by three per cent. Excluding deliveries to the canal project, cement deliveries were four per cent ahead. Aggregates deliveries were stable, but the average price was two per cent lower. Ready-mixed concrete deliveries declined by nine per cent and prices by two per cent. The residential sector remained an important revenue earner.

Costa Rican turnover was 21.4 per cent higher at US$43m, but the EBITDA advanced by 38.5 per cent to US$19.7m. Cement shipments rose by eight per cent and the local currency price improved by five per cent. The aggregates volumes jumped by 45 per cent, but the average price eased by five per cent, suggesting a lower quality mix. Ready-mixed concrete deliveries rose by 10 per cent, but prices weakened by seven per cent following the rise in the previous year. Infrastructure remained the main driver of cement demand with a hydroelectric plant and the Northern Interamerican Road project being the principal investments.

In the remainder of the region turnover was six per cent lower at US$65.6m, but the EBITDA did improve by 4.9 per cent to US$19.94m. The cement volume was nine per cent lower, but the average price did improve by four per cent. Aggregates shipments were sharply higher with a 60 per cent volume increase, with prices being ahead by eight per cent, while in ready-mixed concrete volumes rose by 19 per cent and prices by five per cent. Nicaragua performed strongly in both cement and ready-mixed concrete, while other markets were generally weaker.