Cemex improves first-quarter trading profit

Cemex improves first-quarter trading profit
Published: 24 April 2015


Cemex' first-quarter turnover declined by 5.3 per cent to US$3399.87m, but EBITDA did improve by 6.3 per cent to US$568.54m. Helped by a 12.7 per cent reduction in the depreciation and amortisation charge, the trading profit rose by 25.3 per cent to US$335.32m.

The net interest charge declined by 15.3 per cent to US$338.08m, to give an 82 per cent drop in the pre-tax loss from US$167.88m to US$30.86m. The effective net debt was 3.4 per cent lower at US$15,769m, of which 86 per cent was in US dollar, 12 per cent in euro and 1 per cent in Mexican peso, with 73 per cent of the debt being at fixed rates. Equity shareholders' funds were another 18.0 per cent lower, compared with a 7.7 per cent reduction with a year earlier, at US$8,425.8m, giving a gearing level of 187.2 per cent, up from 158.8 per cent a year earlier.

Cement shipments in the first quarter increased by 3.6 per cent to 16.19Mt and ready-mixed concrete deliveries edged ahead by 0.8 per cent to 12.84Mm³, but the aggregates production declined by 7.8 per cent to 34.86Mt. The number of employees at the end of March was 2.2 per cent higher at 44,110. Total capital expenditure for the year is expected to amount to some US$800m, of which US$500m is maintenance expenditure.

Mexico
The Mexican turnover improved by 3.9 per cent to US$765.7m and the EBITDA recovered by 4.5 per cent to US$261.5m, while the trading profit advanced by 8.2 per cent to US$221.7m. Domestic grey cement deliveries increased by 13 per cent and the price improved by five per cent, though this still meant an eight per cent reduction in US dollar terms. The volume improvement was seen in both bagged and bulk sales, with housebuilding being the strongest segment. Ready-mixed concrete deliveries improved by nine per cent, while the average peso price was six per cent higher. Mexican aggregates deliveries were nine per cent higher and prices advanced by nine per cent.

US
US turnover advanced by 9.6 per cent to US$867.6m and the EBITDA jumped by 128.9 per cent to US$63.8m. At the trading level, the loss was further reduced by 59 per cent to US$32.3m. Cement shipments were unchanged overall in the first quarter, but the average price showed 1 9 per cent improvement. Aggregates deliveries improved by three per cent and the average price improved by a similar percentage. Ready-mixed concrete deliveries rose by 15 per cent, and excluding acquisitions in California were still 13 per cent ahead while the average price improved by eight per cent.

Northern Europe
In northern Europe, largely reflecting changes in the structure with the disposal of the western German operations to Holcim and the acquisition of Holcim’s Czech operations, the turnover declined by 23.1 per cent to US$765.7m but the stronger US dollar also had a negative influence on the numbers.  EBITDA continued its improvement and showed a 180.9 per cent advance to US$35.6m. The seasonal trading loss was reduced by 88.6 per cent to US$4.9m. Cement volumes showed a two per cent improvement and the average price, measured in local currencies, emerged two per cent higher but in dollar terms there was a 14 per cent reduction.

Aggregates deliveries fell by 19 per cent, following the 26 per cent jump a year earlier, but the average price improved by 12 per cent. In ready-mixed concrete, volumes declined by 15 per cent, but the average price was two per cent ahead. In Great Britain, cement deliveries improved by 18 per cent and the price by four per cent, with aggregates volumes rising by six per cent and prices by nine per cent while in ready-mixed concrete shipments declined by two but prices rose by eight per cent.

In Germany, underlying cement deliveries improved by five5 per cent while prices were unchanged, while aggregates shipments declined by 10 per cent and ready-mixed concrete deliveries declined by eight per cent, with prices being one per cent ahead in both aggregates and concrete.

In Poland, where the winter was less severe, cement volumes rose by 32 per cent but the price still fell by eight per cent. Polish aggregates deliveries declined by 14 per cent but the average price ruse by 28 per cent, while ready-mixed concrete deliveries jumped by 25 per cent though the average price came off by three per cent. In France, where Cemex does not sell cement, aggregates deliveries declined by eight per cent but prices were unchanged while in ready-mixed concrete shipments fell by 14 per cent but the average price was stable.

Mediterranean
The Mediterranean region generated a turnover 8.9 per cent lower at US$375.3m while the EBITDA was reduced by 10.5 per cent to US$72.7m with the trading profit declined by 10.8 per cent to US$50m.

Overall grey cement domestic deliveries declined by four per cent, while the average local currency price was eight per cent ahead. Aggregates volumes were down by 16 per cent but the average price did improve by four per cent. In ready-mixed concrete, volumes improved by two per cent and prices improved by one per cent.

In Spain, demand continued to fall and underlying cement deliveries declined by a further eight per cent but the acquisition from Holcim gave an increase of 28 per cent. Spanish aggregates and ready-mixed concrete deliveries fell by 11 per cent and 20 per cent respectively but prices improved by 7 per cent in aggregates and by 15 per cent in ready-mixed concrete.

Egyptian domestic deliveries fell by 12 per cent, but the price improved by 11 per cent in local currency terms, while aggregates shipments jumped by 54 per cent ready-mixed concrete deliveries by 57 per cent and prices were well ahead for both products.

Ready-mixed concrete deliveries reached a record level in Croatia.

South America, Central America and the Caribbean
In South America, Central America and the Caribbean, the turnover declined by 13.1 per cent to US$467.5m and the EBITDA fell by 20.8 per cent to US$147.8m and the trading profit came off by 23.1 per cent to US127.8m.

The cementitious volume declined by 5 per cent, while prices were 1 per cent lower on average when measured in local currencies, but fell by 11 per cent in US dollar terms. Aggregates shipments improved by 5 per cent on an unchanged average price. Ready-mixed concrete volumes improved by three per cent and prices rose by 2 per cent.

Colombian cement shipments declined by 15 per cent following the 34 per cent jump a year earlier and prices were oneper cent lower on average, while aggregates volumes rose by 5 per cent as did ready-mixed concrete volumes. Cement deliveries recovered by nine per cent in Panama and rose by eight per cent in Costa Rica. Record first quarter volumes were seen in Nicaragua, both for cement and for ready-mixed concrete.

Asia
The Asian turnover improved by 12.6 per cent to US$164.4m and the EBITDA rose by 43.4 per cent to US$37.2m while the trading profit jumped by 55.2 per cent to US$28.9m. Cement shipments advanced by 16 per cent, but aggregates deliveries fell by 49 per cent and ready-mixed concrete deliveries declined by 7 per cent. Cement prices were two per cent higher in local currencies and rose by four per cent in dollar terms, while local prices for aggregates declined by 14 per cent but ready-mixed concrete prices improved by three per cent. In the Philippines, domestic cement deliveries improved by 21 per cent and local prices by two per cent.