CEMEX Reports Highest Net Income in a Decade
Thursday, February 08, 2018 6:15:00 AM ET
--Free cash flow after maintenance capex for the full year was US$1.3 billion and conversion of EBITDA into free cash flow after maintenance capex reached 50%.
--Total debt plus perpetual notes was reduced by US$2.1 billion during 2017, on a pro-forma basis.
CEMEX, S.A.B. de C.V. ("CEMEX") (CX ), announced today that, on a
like-to-like basis for the ongoing operations and adjusting for currency
fluctuations, consolidated net sales increased by 4% during the fourth
quarter of 2017 to US$3.4 billion, and increased 3% for the full year
2017 to US$13.7 billion versus the comparable periods in 2016. Operating
EBITDA on a like-to-like basis decreased by 7% during the fourth quarter
of 2017 to US$625 million and decreased by 6% for the full year to
US$2.6 billion versus 2016.
CEMEXs Consolidated Fourth-Quarter and Full-Year
2017 Financial and Operational Highlights
The increase in quarterly consolidated net sales on a like-to-like
basis was due to higher prices of our products, in local currency
terms in Mexico, the U.S. and our Europe region, as well as higher
volumes in our U.S., Europe and Asia, Middle East & Africa regions.
Operating earnings before other expenses, net, in the fourth quarter
decreased by 10%, to US$410 million and decreased by 9%, to US$1.7
billion, for the full-year 2017.
Controlling interest net loss during the quarter was US$105 million
from an income of US$214 million in the same period of 2016.
Controlling interest net income for the full year improved to US$806
million from US$750 million in 2016.
Operating EBITDA on a like-to-like basis decreased by 7% and 6% during
the quarter and the full year, respectively, to US$625 million and
US$2.6 billion versus the comparable periods of 2016.
Operating EBITDA margin during the quarter decreased to 18.3% from
20.7% in the same period of 2016. For the full year, operating EBITDA
margin decreased to 18.8% from 20.6% during 2016.
Free cash flow after maintenance capital expenditures for the quarter
increased by 10% to US$680 million, compared to the same quarter of
2016. For the full year 2017, free cash flow after maintenance capital
expenditures reached US$1.3 billion and conversion of EBITDA into free
cash flow after maintenance capex reached 50%.
Fernando A. Gonzalez, Chief Executive Officer of CEMEX, said, "Although
2017 was a challenging year, our two largest markets, Mexico and the
United States, performed well with like-to-like increases in their
EBITDA. We also generated free cash flow after maintenance capex of
close to US$1.3 billion, with a 50% EBITDA-to-free-cash-flow conversion
rate and which, together with our asset-divestment initiatives, resulted
in pro-forma debt reduction of close to US$2.1 billion during the year.
"We had important headwinds during the year: underperformance in
Colombia, Egypt and the Philippines as well as increased energy costs,
mainly in Mexico. As we have done in the past, we focused on the
variables we control to dampen these headwinds and we continued to
deliver solid results."
Consolidated Corporate Results
During the fourth quarter of 2017, controlling interest net loss was
US$105 million, versus an income of US$214 million in the same period
last year. Controlling interest net income for the full year improved to
US$806 million from US$750 million in 2016.
Total debt plus perpetual notes decreased by US$209 million during the
quarter. During 2017, total debt plus perpetual notes was reduced by
approximately US$1.7 billion, which represents a 13% reduction from the
debt level as of the end of 2016 and a 26% reduction compared to the end
of 2015. On a pro-forma basis, including the payment of the 4.75% senior
secured notes due 2022 outstanding aggregate principal amount, made on
January 2018, total debt plus perpetual notes was reduced by US$2.1
billion during 2017.
Geographical Markets Fourth-Quarter 2017 Highlights
Net sales in our operations in Mexico increased 6% on a
like-to-like basis in the fourth quarter of 2017 to US$781 million,
compared with US$701 million in the fourth quarter of 2016. Operating
EBITDA increased by 8% on a like-to-like basis to US$277 million versus
the same period of last year.
CEMEXs operations in the United States reported net sales of
US$838 million in the fourth quarter of 2017, an increase of 4% on a
like-to-like basis from the same period in 2016. Operating EBITDA
decreased by 5% on a like-to-like basis to US$158 million in the
quarter, versus US$180 million in the same quarter of 2016.
CEMEXs operations in South, Central America and the Caribbean
reported net sales of US$452 million during the fourth quarter of 2017,
representing a decrease of 3% on a like-to-like basis over the same
period of 2016. Operating EBITDA decreased by 10% on a like-to-like
basis to US$105 million in the fourth quarter of 2017, from US$108
million in the same quarter of 2016.
In Europe, net sales for the fourth quarter of 2017 increased by
5% on a like-to-like basis to US$911 million, compared with US$780
million in the fourth quarter of 2016. Operating EBITDA was US$99
million for the quarter, 9% higher on a like-to-like basis than the same
period last year.
Operations in Africa, Middle East and Asia reported a 14%
increase in net sales on a like-to-like basis for the fourth quarter of
2017, to US$363 million, versus the same quarter of 2016. Operating
EBITDA for the quarter was US$53 million, 31% lower on a like-to-like
basis from the same period last year.
CEMEX is a global building materials company that provides high quality
products and reliable service to customers and communities in more than
50 countries. CEMEX has a rich history of improving the well-being of
those it serves through innovative building solutions, efficiency
advancements, and efforts to promote a sustainable future.
This press release contains forward-looking statements and
information that are necessarily subject to risks, uncertainties and
assumptions. Many factors could cause the actual results, performance or
achievements of CEMEX to be materially different from those expressed or
implied in this release, including, among others, changes in general
economic, political, governmental and business conditions globally and
in the countries in which CEMEX does business, changes in interest
rates, changes in inflation rates, changes in exchange rates, the level
of construction generally, changes in cement demand and prices, changes
in raw material and energy prices, changes in business strategy and
various other factors. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those described
herein. CEMEX assumes no obligation to update or correct the information
contained in this press release.
Operating EBITDA is defined as operating income plus depreciation and
operating amortization. Free Cash Flow is defined as Operating EBITDA
minus net interest expense, maintenance and expansion capital
expenditures, change in working capital, taxes paid, and other cash
items (net other expenses less proceeds from the disposal of obsolete
and/or substantially depleted operating fixed assets that are no longer
in operation). Net debt is defined as total debt minus the fair value of
cross-currency swaps associated with debt minus cash and cash
equivalents. The Consolidated Funded Debt to Operating EBITDA ratio is
calculated by dividing Consolidated Funded Debt at the end of the
quarter by Operating EBITDA for the last twelve months. All of the above
items are presented under the guidance of International Financial
Reporting Standards as issued by the International Accounting Standards
Board. Operating EBITDA and Free Cash Flow (as defined above) are
presented herein because CEMEX believes that they are widely accepted as
financial indicators of CEMEXs ability to internally fund capital
expenditures and service or incur debt. Operating EBITDA and Free Cash
Flow should not be considered as indicators of CEMEXs financial
performance, as alternatives to cash flow, as measures of liquidity or
as being comparable to other similarly titled measures of other
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SOURCE: CEMEX, S.A.B. de C.V.">
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CEMEX, S.A.B. de C.V.
Jorge Perez, +52(81) 8888-4334
Eduardo Rendon, +52(81) 8888-4256
Lucy Rodriguez, +1-212-317-6007