CEMEX reveals strategy for EBITDA growth
CEMEX has outlined its strategy to achieve high single-digit EBITDA growth in the medium term. According to the company, since 2020 it has focussed on rebalancing its portfolio towards the US, increasing its percentage of EBITDA contribution from 24 to 29 per cent. CEMEX now intends to increase this to 40 per cent by expanding its growth capex and investing divestment proceeds to the region.
Speaking at an investor day in New York, Fernando A González, CEO at CEMEX, said that the focus going forward would be on accelerated growth in the US, as well as leveraging the company’s leading position in Mexico, pioneering profitable low-carbon and circular practices in Europe, and expanding its Urbanization Solutions business.
First incorporated as a core business in 2020, Urbanization Solutions reached US$2.5bn in sales and US$300m in EBITDA in 2023, accounting for nine per cent of the company’s consolidated EBITDA. This is expected to continue growing at a double-digit rate.
“With industry-leading organic EBITDA growth rate over the last four years, strong free cash flow generation, and our recently received investment grade rating, we will continue to focus on rolling out our bolt-on growth strategy, strengthening our capital structure while introducing a sustainable shareholder return,” explained Mr González. "Additionally, we will continue strengthening our capital structure and maintain a systematic and progressive dividend policy.”
In terms of sustainability, CEMEX’s European operations are reportedly leading the way in the company’s decarbonisation journey. Over the past four years, CEMEX Europe’s EBITDA has seen a seven per cent compounded annual growth rate, with approximately a one percentage point margin expansion, accompanied by a 17 per cent reduction in CO2 emissions. Over 90 per cent of its cement sales in Europe are now from its Vertua family of more sustainable products, with an average 45 per cent carbon reduction.
