Cemex seen posting weak net, US sales may pick up

Cemex seen posting weak net, US sales may pick up
26 July 2010

Cemex is seen posting a 55 per cent fall in second-quarter profit to US$84m but results could show crucial signs of a pick-up in U.S. sales volumes, according to a Reuters poll.

Cemex reported a profit of $187 million in the April-June period of last year.

"While we expect Cemex to report another weak quarter ... for the first time in several quarters U.S. cement volumes should grow on a year-to-year basis by an estimated 8- 10 percent," said Bank of America Merrill Lynch in a report.

A likely US$84m profit in the second quarter still compares favorably with the previous two quarters, when Cemex reported a net loss from its operations in more than 50 countries.

According to seven analysts polled by Reuters, Cemex’s revenue will have probably fallen 11 percent in the quarter, hurt by weak demand in Spain and Mexico, two major markets for the company, overshadowing signs of life in the United States.

Lower sales volumes and the weak Mexican peso and euro versus the U.S. dollar, Cemex’s reporting currency, will also have likely hit the company despite a drive to cut costs. The Mexican peso lost 4.3 percent of its value in the quarter.

Cemex is expected to report before the market opens on July 27 and will probably adjust its 2009 numbers to reflect the sale of its Australian assets in October last year.
Published under Cement News