Cemex sees improved US results going forward

Cemex expects improved results at its US operations between 2013 and 2016 as the local market has shown stronger than expected trends, allowing for improved profitability.

Karl Watson, president of Cemex USA, told analysts during a presentation on Tuesday the company expects US housing starts to increase 16 per cent next year, reaching 873,000. The company forecast US residential sector cement demand will increase by 14 per cent in 2013.

Watson said US annual cement sales are now about US$3bn. The company says it might generate US EBITDA of about US$1.206bn by 2016.

And in four years, Cemex might be producing 16Mt of cement in the United States as sales reach US$5.4bn, the company's management added.

For the first nine months of 2012, the United States, finally, represented 20.5 per cent of Cemex's group turnover and the EBITDA returned to positive territory, but the margin was a mere 1.5 per cent. US turnover recovered and rose by 19.2 per cent to US$2,305.4 and the EBITDA swang back into profit to the tune of US$29.8m, compared with a US$73.8m loss a year earlier. At the trading level, the loss was reduced by 28.7 per cent to US$347.4m. 

Grey cement deliveries in the nine months to September 2012 showed a 16 per cent improvement in the nine months, with half of that coming in the third quarter. Shipments of aggregates improved by an underlying 10 per cent, compared with an 11 per cent decline in the previous year, and prices were one per cent ahead.  In ready-mixed concrete, underlying deliveries improved by 16 per cent and average prices by about 3 per cent.