Cemex expected to report smaller 2Q loss YoY

Cemex expected to report smaller 2Q loss YoY
20 July 2011

Cemex is expected to post a smaller second-quarter net loss on Friday 22 July as revenue gets a lift from higher prices, although concerns over the company’s debt situation linger.

Cemex will likely post a US$64m loss in the three-month period ending in June, compared to a US$306m loss in the second quarter of last year, according to a Reuters poll of seven analysts.

"In our opinion, the weak results in the second quarter had already been priced in by the market in the face of the slow recovery in Europe and weak housing indicators in the United States," said Santander analyst Gonzalo Fernandez.

Revenue is seen rising 8.6 percent to US$4.09bn on a combination of higher prices and a better exchange rate of the peso, the pound and the euro against the dollar during the period.

However, sales volumes in the United States and Europe, two of its key markets, may have declined.

Cemex is seen posting only slight increases in operating results pressured by weak demand and higher energy costs, dampening the company’s ability to generate enough cash to pay its heavy debt burden.

Cemex has had to refinance its debt on several occasions to avoid interest payments from climbing further.

So far this year, Cemex has placed US$4.1bn in bonds and convertibles, and analysts expect the company to continue tapping international debt markets before US$8.3bn in debt comes due in 2014.
Published under Cement News