EX-3 4 d808251dex3.htm EX-3

EX-3

Exhibit 3

2014

Third Quarter Results

2

Forward looking information

This presentation contains certain forward-looking statements and information relating to CEMEX, S.A.B.

de C.V. and its subsidiaries (collectively, “CEMEX”) that are based on its knowledge of present facts,

expectations and projections, circumstances and assumptions about future events. Many factors could

cause the actual results, performance or achievements of CEMEX to be materially different from any

future results, performance or achievements that may be expressed or implied by such forward-looking

statements, including, among others, changes in general economic, political, governmental, and business

conditions globally and in the countries in which CEMEX operates, CEMEX’s ability to comply with the

terms and obligations of its debt agreements and other debt instruments, CEMEX’s ability to achieve

anticipated cost savings, changes in interest rates, changes in inflation rates, changes in exchange rates,

the cyclical activity of the construction sector generally, changes in cement demand and prices, CEMEX’s

ability to benefit from government economic stimulus plans, changes in raw material and energy prices,

changes in business strategy, changes in the prevailing regulatory framework, natural disasters and other

unforeseen events 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 as anticipated, believed, estimated, expected or targeted. Forward-looking

statements are made as of the date hereof, and CEMEX does not intend, nor is it obligated, to update

these forward-looking statements, whether as a result of new information, future events or otherwise.

UNLESS OTHERWISE NOTED, ALL FIGURES ARE PRESENTED IN DOLLARS,  

BASED ON INTERNATIONAL FINANCIAL REPORTING STANDARDS

Copyright CEMEX, S.A.B. de C.V. and its subsidiaries.

3

3Q14 results highlights

During the quarter, operating EBITDA increased by 3% on a like-to-like basis mainly due to

higher contributions from the U.S. and the Mediterranean and Asia regions

Millions of US dollars

2014

2013

% var

l-t-l   %

var 

2014

2013

% var

l-t-l %

var 

Net sales

11,871

11,353

5%

6%

4,135

4,022

3%

4%

Gross profit

3,714

3,491

6%

7%

1,400

1,298

8%

9%

Operating earnings before

other expenses, net

1,213

1,160

5%

7%

491

467

5%

6%

Operating EBITDA

2,037

2,001

2%

3%

767

747

3%

3%

Free cash flow after

maintenance capex

(43)

(311)

86%

350

245

43%

January – September

Third Quarter

4

Consolidated volumes and prices

Year-over-year increase in cement and ready-mix volumes in all of our regions, with the exception

of the Mediterranean in cement and the Northern Europe and Asia regions in ready mix

Quarterly consolidated prices for cement, ready mix and aggregates in both local-currency and

U.S.-dollar terms are higher on a year-over-year basis

Sequential increase in consolidated ready-mix local currency prices, on a like-to-like basis, mainly

driven by increases in the U.S. and the South, Central America and the Caribbean region

1

Like-to-like volumes adjusted for investments/divestments and, in the case of prices, foreign-exchange fluctuations

9M14 vs. 9M13

3Q14 vs. 3Q13

3Q14 vs. 2Q14

Volume (l-t-l

¹

)

4%

3%

2%

Price (USD)

1%

2%

(1%)

Price (l-t-l

¹

)

2%

3%

(0%)

Volume (l-t-l

¹

)

2%

0%

3%

Price (USD)

4%

2%

(2%)

Price (l-t-l

¹

)

3%

3%

1%

Volume (l-t-l

¹

)

5%

1%

3%

Price (USD)

6%

4%

(3%)

Price (l-t-l

¹

)

5%

4%

(1%)

Aggregates

Domestic gray

cement

Ready mix

Consolidated cement, ready-mix and aggregates volumes year-to-date increased by

4%, 2% and 5%, respectively

Consolidated prices in local-currency terms for cement, ready mix and aggregates

increased year-over-year by 3%, 3% and 4%, respectively, during the quarter

Issuance of 5.700% senior secured notes for US$1.1 billion maturing in 2025 and

4.750% senior secured notes for €400 million maturing in 2022

New syndicated loan facility for

US$1.35 billion with improved terms which reflect

our better credit profile

Our subsidiary CLH announced the construction of a new cement plant in Colombia

with production capacity of close to 1 million tons per year

5

3Q14 achievements

Third Quarter 2014

Regional Highlights

7

Mexico

Millions of

US dollars

Net Sales

2,354

2,402

(2%)

1%

803

776

4%

5%

Op. EBITDA

742

761

(3%)

0%

245

248

(1%)

0%

as % net sales

31.5%

31.7%

(0.2pp)

30.5%

31.9%

(1.4pp)

3Q14

3Q13

% var

l-t-l % var

9M14

9M13

% var

l-t-l % var  

Quarterly and year-to-date increases in

volumes and local-currency prices for our three

core products

Formal construction, especially the formal

residential and commercial sectors, were the

main drivers of demand during the quarter

Activity in the informal residential sector

showed slight growth during the quarter

Certain awarded highway projects should

begin during 4Q14

Volume

9M14 vs.

9M13

3Q14 vs.

3Q13

3Q14 vs.

2Q14

Cement

1%

4%

0%

Ready mix

4%

5%

3%

Aggregates

11%

8%

4%

Price (LC)

9M14 vs.

9M13

3Q14 vs.

3Q13

3Q14 vs.

2Q14

Cement

1%

3%

0%

Ready mix

2%

2%

(0%)

Aggregates

3%

5%

1%

8

United States

Millions of

US dollars

Net Sales

2,755

2,495

10%

13%

1,007

891

13%

15%

Op. EBITDA

283

178

60%

57%

136

78

74%

70%

as % net sales

10.3%

7.1%

3.2pp

13.5%

8.8%

4.7pp

3Q14

3Q13

% var

l-t-l % var

9M14

9M13

% var

l-t-l % var  

Volume

9M14 vs.

9M13

3Q14 vs.

3Q13

3Q14 vs.

2Q14

Cement

8%

8%

4%

Ready mix

0%

2%

4%

Aggregates

(2%)

1%

1%

Price (LC)

9M14 vs.

9M13

3Q14 vs.

3Q13

3Q14 vs.

2Q14

Cement

5%

8%

0%

Ready mix

9%

9%

2%

Aggregates

11%

9%

(1%)

Cement and pro-forma ready-mix volumes

increased by 8% on a year-over-year basis

High-single-digit growth in year-over-year prices

for our three core products

The industrial-and-commercial sector and the

steady expansion in the residential sector were

the main drivers of volume growth during the

quarter

Contract awards for our four key states in the

industrial and commercial sector outperforming

the national average, especially in Texas and

Arizona

9

Northern Europe

Volume

9M14 vs.

9M13

3Q14 vs.

3Q13

3Q14 vs.

2Q14

Cement

4%

1%

18%

Ready mix

(0%)

(8%)

2%

Aggregates

7%

(0%)

4%

Price (LC)

1

9M14 vs.

9M13

3Q14 vs.

3Q13

3Q14 vs.

2Q14

Cement

(0%)

(2%)

(4%)

Ready mix

1%

1%

(1%)

Aggregates

0%

1%

(2%)

Millions of

US dollars

Net Sales

3,187

3,012

6%

2%

1,135

1,169

(3%)

(3%)

Op. EBITDA

279

253

10%

7%

144

162

(11%)

(12%)

as % net sales

8.8%

8.4%

0.4pp

12.7%

13.9%

(1.2pp)

3Q14

3Q13

% var

l-t-l % var

9M14

9M13

% var

l-t-l % var  

Regional cement volumes increased during the

quarter mainly due to improved performance in

Poland, Scandinavia, and the Czech Republic that

more than offset declines in Germany and Latvia

Prices in local-currency terms in Germany and the

UK increased on a year-over-year basis for our

three core products

In Poland, infrastructure spending was the main

driver of demand during the quarter

In the UK, the residential sector continues as the

main driver of demand, supported by improved

economic conditions, increased consumer

confidence, and government incentives to

promote home ownership

1

Volume-weighted, local-currency average prices

10

Mediterranean

Millions of

US dollars

Net Sales

1,260

1,122

12%

11%

400

375

7%

8%

Op. EBITDA

263

246

7%

7%

81

78

4%

6%

as % net sales

20.8%

21.9%

(1.1pp)

20.3%

20.8%

(0.5pp)

3Q14

3Q13

% var

l-t-l % var

9M14

9M13

% var

l-t-l % var  

Increases in cement volumes in Spain, Croatia and

the UAE during the quarter

All countries in the region showed growth in year-

over-year ready-mix volumes

Sequential increase in local currency cement

prices in Spain and Egypt

In Egypt, the informal sector remains as the main

driver for cement demand; there was a pickup in

activity in the formal residential sector

In Spain, domestic gray cement volumes showed

year-over-year growth for the second consecutive

quarter; total cement volumes including exports

increased by 28% during the quarter

1

Volume-weighted, local-currency average prices

Volume

9M14 vs.

9M13

3Q14 vs.

3Q13

3Q14 vs.

2Q14

Cement

(0%)

(3%)

(13%)

Ready mix

8%

13%

2%

Aggregates

(3%)

(1%)

(0%)

Price (LC)

¹

9M14 vs.

9M13

3Q14 vs.

3Q13

3Q14 vs.

2Q14

Cement

10%

12%

2%

Ready mix

2%

(2%)

(0%)

Aggregates

20%

17%

(2%)

11

South, Central America and the Caribbean

1

Volume-weighted, local-currency average prices

Millions of

US dollars

Net Sales

1,684

1,657

2%

6%

585

596

(2%)

0%

Op. EBITDA

563

610

(8%)

(4%)

199

210

(6%)

(4%)

as % net sales

33.4%

36.8%

(3.4pp)

34.0%

35.3%

(1.3pp)

3Q14

3Q13

% var

l-t-l % var

9M14

9M13

% var

l-t-l % var  

Increase in regional cement volumes, on a year-

over-year basis, mainly driven by growth in

Colombia, the Dominican Republic and Nicaragua

Double-digit growth in year-to-date volumes for

our three core products in Colombia driven by

positive performance in all demand segments

In Panama, the residential sector was the main

driver of demand; achieved record volumes in

ready-mix and aggregates during the quarter

Volume

9M14 vs.

9M13

3Q14 vs.

3Q13

3Q14 vs.

2Q14

Cement

6%

3%

3%

Ready mix

9%

5%

8%

Aggregates

17%

10%

5%

Price (LC)

¹

9M14 vs.

9M13

3Q14 vs.

3Q13

3Q14 vs.

2Q14

Cement

(0%)

(1%)

(0%)

Ready mix

1%

0%

1%

Aggregates

(0%)

(0%)

(0%)

12

Asia

¹

Volume-weighted, local-currency average prices

Millions of

US dollars

Net Sales

457

444

3%

10%

151

139

9%

10%

Op. EBITDA

99

99

0%

3%

40

36

11%

10%

as % net sales

21.7%

22.2%

(0.5pp)

26.4%

25.9%

0.5pp

3Q14

3Q13

% var

l-t-l % var

9M14

9M13

% var

l-t-l % var  

Regional domestic cement volumes increase

during the quarter reflects positive performance

in the Philippines

Sequential increase in regional cement and

aggregates prices, in local-currency terms

Growth in cement volumes in the Philippines

reflects positive performance in all sectors

Housing activity in the Philippines has benefited

from increased remittances, stable inflation and

low mortgage rates

Volume

9M14 vs.

9M13

3Q14 vs.

3Q13

3Q14 vs.

2Q14

Cement

5%

5%

(4%)

Ready mix

(16%)

(4%)

(11%)

Aggregates

(8%)

(44%)

(18%)

Price (LC)

¹

9M14 vs.

9M13

3Q14 vs.

3Q13

3Q14 vs.

2Q14

Cement

2%

3%

1%

Ready mix

12%

9%

0%

Aggregates

3%

(11%)

5%

3Q14 Results

14

Operating EBITDA, cost of sales and operating expenses

Millions of US dollars

2014

2013

% var

l-t-l

% var  

2014

2013

% var

l-t-l

% var

Net sales

11,871

11,353

5%

6%

4,135

4,022

3%

4%

Operating EBITDA

2,037

2,001

2%

3%

767

747

3%

3%

as % net sales

17.2%

17.6%

(0.4pp)

18.5%

18.6%

(0.1pp)

Cost of sales

8,157

7,862

(4%)

2,735

2,724

(0%)

as % net sales

68.7%

69.2%

0.5pp

66.1%

67.7%

1.6pp

Operating expenses

2,501

2,332

(7%)

909

831

(9%)

as % net sales

21.1%

20.5%

(0.6pp)

22.0%

20.7%

(1.3pp)

January – September

Third Quarter

Increase of 3% in operating EBITDA mainly due to higher contributions from the U.S. and the

Mediterranean and Asia regions

Cost of sales, as a percentage of net sales, decreased by 1.6pp mainly due to continuous

operating efficiencies and product mix

Operating expenses, as a percentage of net sales, increased by 1.3pp mainly reflecting higher

distribution expenses

15

Free cash flow

Millions of US dollars

2014

2013

% var

2014

2013

% var

Operating EBITDA

2,037

2,001

2%

767

747

3%

- Net Financial Expense

1,026

1,066

335

348

- Maintenance Capex

298

255

108

105

- Change in Working Cap

381

497

(70)

(34)

- Taxes Paid

483

440

46

35

- Other Cash Items (net)

(109)

55

(2)

48

Free Cash Flow after Maint. Capex

(43)

(311)

86%

350

245

43%

- Strategic Capex

101

72

46

36

Free Cash Flow

(143)

(382)

62%

303

209

45%

January – September

Third Quarter

Year-to-date working capital days decreased to 27 from 29 days during the same period in 2013

Other expenses, net, during the quarter resulted in an expense of US$86 million mainly due to

impairment of fixed assets, a loss in sale of fixed assets and severance payments

Foreign-exchange gain of US$97 million resulting primarily from the fluctuation of the

Mexican peso versus the U.S. dollar

Gain on financial instruments of US$8 million related mainly to CEMEX shares

Controlling interest net loss of US$106 million, versus a loss of US$155 in 3Q13, mainly

reflects higher operating earnings before other expenses, lower other expenses, and a higher

foreign-exchange gain, mitigated by higher financial expenses, a lower gain on financial

instruments and higher income taxes

16

Other income statement items

Third Quarter 2014

Debt Information

Issuance of US$1.1 billion of 5.700% senior secured notes maturing in 2025 and €400 million

of 4.750% senior secured notes maturing in 2022. Proceeds used to pay:

•

Approximately US$593 million of our 9.000% senior secured notes due 2018

•

Approximately US$365 million of our 9.250% senior secured notes due 2020

•

US$350 million of debt under the Facilities Agreement

•

In addition, a reserve for approximately US$227 million created to pay additional debt

Early conversion of additional US$116 million of our 4.875% convertible subordinated notes

due 2015; approximately US$204 million of these notes remain outstanding

•

Contingent Convertible Units for a total amount of US$200 million were issued during the quarter to

finance these convertible notes in case they mature without conversion

Obtained new syndicated loan facility for US$1.35 billion in October with improved terms over

the existing Facilities Agreement

18

Debt-related information

19

Consolidated debt maturity profile

Total debt excluding perpetual notes

¹

as of September 30, 2014

US$ 16,479 million

19

996

2,172

227

938

1,507

3,865

2,522

Millions of

US dollars

2,016

1,255

Fixed Income

Facilities Agreement

Other bank / WC debt / Certificados

Bursátiles

Convertible

Subordinated

Notes

²

1

CEMEX has perpetual debentures totaling US$470 million

2

Convertible Subordinated Notes include only the debt component of US$1,712 million; total notional amount is about US$1,871 million

963

Average life of debt: 4.9 years

0

1,000

2,000

3,000

4,000

5,000

6,000

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

20

Consolidated debt maturity profile –

pro forma

¹

Total

debt

excluding

perpetual

notes

²

as

of

September

30,

2014

pro

forma

¹

US$ 16,479 million

996

2,712

227

938

1,507

2,785

3,062

Millions of

US dollars

2,016

963

1,255

19

Average life of debt: 5 years

1

2

3

Fixed Income

Facilities Agreement

Other bank / WC debt / Certificados

Bursátiles

Convertible

Subordinated

Notes

³

New Syndicated Loan Facility

0

1,000

2,000

3,000

4,000

5,000

6,000

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

Pro forma includes: (a) New syndicated loan facility for US$1,350 million signed in October and (b) Facilities Agreement prepayment of

US$1,350 million in October 

CEMEX has perpetual debentures totaling US$470 million

Convertible Subordinated Notes include only the debt component of US$1,712 million; total notional amount is about US$1,871 million

2014 Outlook

We expect mid-single-digit increases in consolidated volumes for cement, ready mix and

aggregates

Cost of energy, on a per ton of cement produced basis, expected to be relatively flat from last

year’s level

Total capital expenditures expected to be about US$765 million, US$505 million in

maintenance capex and US$260 million in strategic capex

We expect working capital investment during the year to be similar to last year’s

We expect cash taxes to reach US$600 million

We expect a marginal reduction in our cost of debt, including our perpetual and convertible

securities

22

2014 guidance

Appendix

24

Additional information on debt and perpetual notes

Interest rate

Currency denomination

Fixed

69%

Variable

31%

U.S. dollar

86%

Euro

13%

Mexican peso

1%

Second Quarter

2014

2013

% Var.

2014

Total debt

1

16,479

16,655

(1%)

16,569

Short-term

6%

3%

3%

Long-term

94%

97%

97%

Perpetual notes

470

475

(1%)

476

Cash and cash equivalents

1,004

895

12%

737

Net debt plus perpetual notes

15,944

16,235

(2%)

16,308

Consolidated Funded Debt

2

/ EBITDA

3

5.37

5.56

5.49

Interest coverage

3 4

2.21

2.08

2.15

Third Quarter

Millions of US dollars

1

2

3

4

Includes convertible notes and capital leases, in accordance with IFRS

Consolidated Funded Debt as of September 30, 2014 was US$14,403 million, in accordance with our contractual obligations under the Facilities

Agreement

EBITDA calculated in accordance with IFRS

Interest expense in accordance with our contractual obligations under the Facilities Agreement

25

9M14 volume and price summary: Selected countries

Prices

Prices

Prices

(LC)

(LC)

(LC)

Mexico

1%

(2%)

1%

4%

(1%)

2%

11%

(0%)

3%

U.S.

8%

5%

5%

0%

9%

9%

(2%)

11%

11%

Germany

1%

4%

2%

0%

5%

3%

(2%)

2%

(0%)

Poland

5%

(1%)

(4%)

(5%)

(6%)

(9%)

6%

10%

7%

France

N/A

N/A

N/A

(4%)

2%

(1%)

5%

1%

(1%)

UK

1%

9%

1%

2%

13%

4%

13%

10%

2%

Spain

2%

(6%)

(8%)

3%

8%

6%

(17%)

6%

4%

Egypt

(4%)

16%

19%

11%

12%

15%

37%

(29%)

(27%)

Colombia

18%

(7%)

(3%)

14%

(3%)

1%

24%

(4%)

(1%)

Panama

(14%)

12%

12%

(4%)

(0%)

(0%)

(1%)

(2%)

(2%)

Costa Rica

1%

(3%)

5%

(24%)

(4%)

4%

(0%)

(11%)

(3%)

Philippines

7%

(2%)

3%

N/A

N/A

N/A

N/A

N/A

N/A

Prices

(USD)

Volumes

Prices

(USD)

Volumes

Prices

(USD)

Volumes

Aggregates

9M14 vs. 9M13

Domestic gray cement 

9M14 vs. 9M13

Ready mix                                  

9M14 vs. 9M13

26

3Q14 volume and price summary: Selected countries

Prices

Prices

Prices

(LC)

(LC)

(LC)

Mexico

4%

2%

3%

5%

1%

2%

8%

3%

5%

U.S.

8%

8%

8%

2%

9%

9%

1%

9%

9%

Germany

(6%)

(1%)

1%

(7%)

(1%)

1%

(12%)

(0%)

2%

Poland

8%

(8%)

(8%)

(15%)

(8%)

(8%)

(12%)

11%

12%

France

N/A

N/A

N/A

(13%)

(2%)

0%

(1%)

(5%)

(3%)

UK

(0%)

7%

1%

(2%)

13%

7%

10%

9%

3%

Spain

7%

(9%)

(7%)

6%

3%

5%

(6%)

13%

15%

Egypt

(8%)

19%

22%

46%

18%

22%

133%

(38%)

(36%)

Colombia

14%

(8%)

(6%)

8%

(1%)

(0%)

12%

(3%)

(1%)

Panama

(6%)

11%

11%

4%

(1%)

(1%)

7%

(2%)

(2%)

Costa Rica

(10%)

(2%)

5%

(32%)

(6%)

1%

7%

(10%)

(4%)

Philippines

6%

4%

4%

N/A

N/A

N/A

N/A

N/A

N/A

Prices

(USD)

Volumes

Prices

(USD)

Aggregates

3Q14 vs. 3Q13

3Q14 vs. 3Q13

Domestic gray cement 

3Q14 vs. 3Q13

Prices

(USD)

Volumes

Ready mix  

Volumes

27

2014 expected outlook: Selected countries

1

On a like-to-like basis for the ongoing operations

Domestic gray cement

Ready mix

Aggregates

Volumes

Volumes

Volumes

Consolidated

mid-single-digit growth

mid-single-digit growth

mid-single-digit growth

Mexico

low-single-digit growth

mid-single-digit growth

high-single-digit growth

United States

high-single-digit growth

mid-single-digit growth

0%

Germany

0%

(1%)

(3%)

Poland

5%

2%

2%

France

N/A

(5%)

(8%)

UK

1%

1%

9%

Spain

0%

4%

(14%)

Egypt

(7%)

11%

30%

Colombia

15%

13%

18%

Panama

(13%)

(4%)

(3%)

Costa Rica

2%

(15%)

1%

Philippines

9%

N/A

N/A

1

28

Definitions

9M14

/

9M13:

Results

for

the

nine

months

of

the

years

2014

and

2013,

respectively.

Cement:

When

providing

cement

volume

variations,

refers

to

domestic

gray

cement

operations

(starting in 2Q10, the base for reported cement volumes changed from total domestic cement

including clinker to domestic gray cement)

LC:

Local

currency.

Like-to-like

percentage

variation

(l-t-l

%

var):

Percentage

variations

adjusted

for

investments/divestments and currency fluctuations

Maintenance

capital

expenditures:

Investments

incurred

for

the

purpose

of

ensuring

the

company’s operational continuity. These include capital expenditures on projects required to

replace obsolete assets or maintain current operational levels, and mandatory capital

expenditures, which are projects required to comply with governmental regulations or company

policies

Operating

EBITDA:

Operating

earnings

before

other

expenses,

net

plus

depreciation

and

operating amortization

pp:

Percentage points

Prices:

All references to pricing initiatives, price increases or decreases, refer to our prices for

our products

Strategic

capital

expenditures:

Investments

incurred

with

the

purpose

of

increasing

the

company’s profitability. These include capital expenditures on projects designed to increase

profitability by expanding capacity, and margin improvement capital expenditures, which are

projects designed to increase profitability by reducing costs

29

Contact information

Calendar of Events

February 5, 2015

Fourth quarter 2014 financial results conference call