EX-2 3 d98575dex2.htm EX-2

Exhibit 2

2015

SECOND QUARTER RESULTS

Stock Listing Information

Colombian Stock Exchange S.A. Ticker: CLH

Investor Relations

Jesús Ortiz de la Fuente +57 (1) 603-9051

E-mail: jesus.ortizd@cemex.com

OPERATING AND FINANCIAL HIGHLIGHTS

January - June

Second Quarter

2015

2014

% var

2015

2014

% var

Consolidated cement volume

3,620

3,931

(8%)

1,880

1,964

(4%)

Consolidated domestic gray cement

3,307

3,500

(6%)

1,714

1,766

(3%)

Consolidated ready-mix volume

1,753

1,670

5%

904

851

6%

Consolidated aggregates volume

4,369

4,145

5%

2,257

2,197

3%

Net sales

748

864

(13%)

394

441

(11%)

Gross profit

356

420

(15%)

186

212

(12%)

as % of net sales

47.6%

48.6%

(1.0pp)

47.2%

48.0%

(0.8pp)

Operating earnings before other

192

236

(19%)

101

118

(14%)

expenses, net

as % of net sales

25.6%

27.3%

(1.7pp)

25.8%

26.6%

(0.8pp)

Controlling interest net income

82

121

(32%)

39

67

(42%)

Operating EBITDA

236

283

(17%)

124

142

(13%)

as % of net sales

31.6%

32.8%

(1.2pp)

31.5%

32.2%

(0.7pp)

Free cash flow after maintenance

137

142

(3%)

70

62

13%

capital expenditures

Free cash flow

66

130

(49%)

48

55

(13%)

Net debt

1,077

1,178

(9%)

1,077

1,178

(9%)

Total debt

1,136

1,237

(8%)

1,136

1,237

(8%)

Earnings per share

0.15

0.22

(32%)

0.15

0.22

(32%)

Shares outstanding at end of period

556

556

0%

556

556

0%

Employees

5,093

4,662

9%

5,093

4,662

9%

Cement and aggregates volumes in thousands of metric tons. Ready-mix volumes in thousands of cubic meters

In millions of US dollars, except volumes, percentages, employees, and per-share amounts

Shares outstanding are presented in millions.

Consolidated net sales during the second quarter of 2015 declined by 11% compared to the second quarter of 2014. During the first six months of 2015 consolidated net sales decreased by 13%, compared to the same period in 2014. This decline in net sales is explained mainly as a result of foreign exchange fluctuations and the effect of lower cement volumes from our operations in Colombia.

Cost of sales as a percentage of net sales during the first six months of 2015 increased by 1.0pp from 51.4% to 52.4% on a year-over-year basis.

Operating expenses as a percentage of net sales during the first six months of 2015 increased by 0.7pp from 21.3% to 22.0% compared to the same period in 2014.

Operating EBITDA during the second quarter of 2015 declined by 13% compared to the second quarter of 2014. During the first six months of 2015 operating EBITDA decreased by 17%, compared to the same period in 2014.This decline is mainly explained by foreign exchange fluctuations and the effect of lower cement volumes from our operations in Colombia.

Operating EBITDA margin during the second quarter of 2015 declined by 0.7pp, compared to the second quarter of 2014. During the first six months of the year operating EBITDA margin declined by 1.2pp compared with the same period last year.

Controlling interest net income during the second quarter of 2015 reached US$39 million, declining by 42% compared to the second quarter of 2014. During the first six months of 2015 controlling interest net inco

me reached US$82 million, declining 32% compared to the same period in 2014.

Toal debt at the end of the second quarter of 2015 reached US$1,136 million.

2015 Second Quarter Results

Page 2

OPERATING RESULTS

Colombia

January - June

Second Quarter

2015

2014

% var

2015

2014

% var

Net sales

374

502

(25%)

198

260

(24%)

Operating EBITDA

128

181

(29%)

68

88

(23%)

Operating EBITDA margin

34.1%

36.0%

(1.9pp)

34.5%

34.0%

0.5pp

In millions of US dollars, except percentages.

Domestic gray cement

Ready Mix

Aggregates

January - June

Second Quarter

January - June

Second Quarter

January - June Second Quarter

Volume

(11%)

(7%)

4%

3%

2%

0%

Price (USD)

(21%)

(22%)

(19%)

(20%)

(21%)

(22%)

Price (local currency)

1%

2%

4%

4%

1%

3%

Year-over-year percentage variation.

In Colombia, during the second quarter our domestic gray cement volumes declined by 7%, while our ready-mix volumes increased by 3% and our aggregates volumes remained stable, compared to the second quarter of 2014. For the first six months of 2015, our domestic gray cement volumes decreased by 11%, while our ready-mix and aggregates volumes increased by 4% and 2%, respectively, compared to the same period in 2014. Cement volumes during the second quarter improved by 11% sequentially, reflecting a partial recovery of our market share lost in the first quarter as a result of our price increase.

Panama

January - June

Second Quarter

2015

2014

% var

2015

2014

% var

Net sales

151

149

2%

79

73

9%

Operating EBITDA

61

66

(7%)

33

34

(3%)

Operating EBITDA margin

40.7%

44.4%

(3.7pp)

41.4%

46.4%

(5.0pp)

In millions of US dollars, except percentages.

Domestic gray cement

Ready Mix

Aggregates

January - June

Second Quarter

January - June

Second Quarter

January - June Second Quarter

Volume

7%

4%

(0%)

10%

10%

21%

Price (USD)

1%

%

(3%)

(3%)

3%

7%

Price (local currency)

1% 6%

(3%)

(3%)

3%

7%

Year-over-year percentage variation.

In Panama during the second quarter our domestic gray cement, ready-mix and aggregates volumes increased by 4%, 10% and 21% respectively, compared to the second quarter of 2014. For the first half of 2015, our domestic gray cement and aggregates volumes increased by 7% and 10% respectively, while our ready-mix volumes remained stable, compared with the same period 2014.

During the quarter, the positive performance in our volumes was fueled by higher sales to the residential sector, which continued being the main driver of demand for our products, as well as a basis effect related to the constructions workers strike in the second quarter of 2014. Cement sales to the Panama Canal expansion project declined by 58% during the quarter on a year-over-year basis.

2015 Second Quarter Results

Page 3

OPERATING RESULTS

Costa Rica

January - June

Second Quarter

2015

2014

% var

2015

2014

% var

Net sales

89

76

18%

46

41

15%

Operating EBITDA

39

33

18%

20

19

5%

Operating EBITDA margin

43.9%

43.9%

0.0pp

42.1%

45.9%

(3.8pp)

In millions of US dollars, except percentages.

Domestic gray cement

Ready Mix

Aggregates

January - June

Second Quarter

January - June

Second Quarter

January - June Second Quarter

Volume

11%

14%

15%

20%

38%

31%

Price (USD)

5%

5%

(2%)

1%

0%

4%

Price (local currency)

4%

2%

(4%)

(2%)

(2%)

2%

Year-over-year percentage variation.

In Costa Rica, during the second quarter our domestic gray cement, ready-mix, and aggregates volumes increased by 14%, 20% and 31%, respectively, compared to the second quarter of 2014. For the first six-months of the year our domestic gray cement, ready-mix and aggregates volumes increased by 11%, 15% and 38%, respectively, compared to the same period of last year.

During the second quarter infrastructure remained as the main driver for cement demand with the ongoing construction of roads, as well as hydroelectric projects like “Chucás” and “Capulĺn”.

Rest of CLH

January - June

Second Quarter

2015

2014

% var

2015

2014

% var

Net sales

141

143

(1%)

76

73

3%

Operating EBITDA

40

40

(1%)

20

21

(7%)

Operating EBITDA margin

28.1%

28.0%

0.1pp

26.1%

28.8%

(2.7pp)

In millions of US dollars, except percentages.

Domestic gray cement

Ready Mix

Aggregates

January - June

Second Quarter

January - June

Second Quarter

January - June Second Quarter

Volume

(7%)

(6%)

21%

23%

2%

(25%)

Price (USD)

(2%)

(4%)

2%

1%

16%

20%

Price (local currency)

3%

2

4%

2%

19%

23%

Year-over-year percentage variation.

In the Rest of CLH region, which includes our operations in Nicaragua, Guatemala, El Salvador and Brazil, during the second quarter of 2015 our domestic gray cement and aggregates volumes decreased by 6% and 25%, respectively, while our ready-mix volumes increased by 23%, compared to the second quarter of 2014. During the first half of the year, our domestic gray volumes decreased by 7%, while our ready-mix and aggregates volumes increased by 21% and 2% respectively, compared to the same period of last year.

The positive performance in our cement volumes in Nicaragua was offset by weak demand conditions in the other markets. Housing and infrastructure in Nicaragua, along with industrial-and-commercial activity in Guatemala, remained the main drivers of demand for our products.

2015 Second Quarter Results

Page 4

OPERATING EBITDA, FREE CASH FLOW AND DEBT RELATED INFORMATION

Operating EBITDA and free cash flow

January - June

Second Quarter

2015

2014

% var

2015

2014

% var

Operating earnings before other expenses, net

192

236

(19%)

102

118

(14%)

+ Depreciation and operating amortization

45

47

23

24

Operating EBITDA

237

283

(16%)

125

142

(12%)

- Net financial expense

42

48

21

24

- Capital expenditures for maintenance

13

26

9

17

- Change in working Capital

(26)

9

(31)

2

- Taxes paid

63

59

49

38

- Other cash items (Net)

8

(0)

7

(0)

Free cash flow after maintenance capital exp

137

142

(3%)

70

62

13%

- Strategic Capital expenditures

71

12

23

7

Free cash flow

66

130

(49%)

48

55

(13%)

In millions of US dollars, except percentages.

Information on Debt

Second Quarter

First Quarter

Second Quarter

2015

2014

% var

2015

2015

2014

Total debt 1, 2

1,136

1,237

(8%)

1,188

Currency denomination

Short term

13%

21%

12%

U.S. dollar

99%

98%

Long term

87%

79%

88%

Colombian peso

1%

2%

Cash and cash equivalents

59

(59)

n/a

63

Interest rate

Net debt

1,077

1,178

(9%)

1,125

Fixed

78%

79% Variable

22%

21%

In millions of US dollars, except percentages

1 Includes capital leases, in accordance with International Financial Reporting Standards (IFRS).

2 Represents the consolidated balances of CLH and subsidiaries.

2015 Second Quarter Results Page

OPERATING RESULTS

Income statement & balance sheet

CEMEX Latam Holdings, S.A. and Subsidiaries

in thousands of U.S. Dollars, except per share amounts

January - June

Second Quarter

INCOME STATEMENT

2015

2014

% var

2015

2014

% var

Net sales

747,600

863,955

(13%)

393,762

441,201

(11%)

Cost of sales

(391,636)

(444,151)

12%

(208,030)

(229,403)

9%

Gross profit

355,964

419,804

(15%)

185,733

211,798

(12%)

Operating expenses

(164,290)

(184,223)

11%

(84,245)

(94,283)

11%

Operating earnings before other expenses, net

191,674

235,581

(19%)

101,487

117,514

(14%)

Other expenses, net

(7,115)

519

N/A

(5,135)

743

N/A

Operating earnings

184,559

236,100

(22%)

96,352

118,257

(19%)

Financial expenses

(40,565)

(47,625)

15%

(19,976)

(23,222)

14%

Other income (expenses), net

(2,028)

(4,306)

53%

(6,731)

(5,160)

(30%)

Net income before income taxes

141,966

184,169

(23%)

69,645

89,875

(23%)

Income tax

(59,232)

(62,617)

5%

(30,875)

(23,143)

(33%)

Consolidated net income

82,734

121,552

(32%)

38,770

66,732

(42%)

Non-controlling Interest Net Income

(307)

(392)

22%

(134)

(192)

30%

Controlling Interest Net Income

82,427

121,160

(32%)

38,636

66,540

(42%)

Operating EBITDA

236,350

283,070

(17%)

123,923

142,072

(13%)

Earnings per share

0.15

0.22

(32%)

0.07

0.12

(42%)

as of June 30

BALANCE SHEET

2015

2014

% var

Total Assets

3,465,039

3,844,232

(10%)

Cash and Temporary Investments

58,683

59,303

(1%)

Trade Accounts Receivables

124,828

165,809

(25%)

Other Receivables

52,211

90,304

(42%)

Inventories

102,768

114,802

(10%)

Other Current Assets

21,843

23,913

(9%)

Current Assets

360,332

454,131

(21%)

Fixed Assets

1,117,256

1,218,121

(8%)

Other Assets

1,987,451

2,171,980

(8%)

Total Liabilities

2,034,612

2,387,169

(15%)

Current Liabilities

438,971

647,117

(32%)

Long-Term Liabilities

1,584,765

1,727,100

(8%)

Other Liabilities

10,876

12,952

(16%)

Consolidated Stockholders’ Equity

1,424,743

1,450,953

(2%)

Non-controlling Interest

5,685

6,110

(7%)

Stockholders’ Equity Attributable to Controlling Interest

1,430,427

1,457,063

(2%)

2015 Second Quarter Results Page 6

OPERATING RESULTS

Income statement & balance sheet

CEMEX Latam Holdings, S.A. and Subsidiaries

in millions of Colombian Pesos in nominal terms, except per share amounts

January - June

Second Quarter

INCOME STATEMENT

2015

2014

% var

2015

2014

% var

Net sales

1,871,629

1,691,252

11%

985,319

841,736

17%

Cost of sales

(980,467)

(869,459)

(13%)

(520,557)

(437,927)

(19%)

Gross profit

891,163

821,794

8%

464,763

403,810

15%

Operating expenses

(411,302)

(360,616)

(14%)

(210,807)

(179,885)

(17%)

Operating earnings before other expenses, net

479,858

461,177

4%

253,952

223,924

13%

Other expenses, net

(17,812)

1,017

N/A

(12,849)

1,466

N/A

Operating earnings

462,046

462,194

(0%)

241,103

225,390

7%

Financial expenses

(101,554)

(93,234)

(9%)

(49,985)

(44,196)

(13%)

Other income (expenses), net

(5,078)

(8,427)

40%

(16,844)

(10,143)

(66%)

Net income before income taxes

355,414

360,533

(1%)

174,274

171,051

2%

Income tax

(148,288)

(122,577)

(21%)

(77,259)

(43,255)

(79%)

Consolidated net income

207,126

237,957

(13%)

97,015

127,796

(24%)

Non-controlling Interest Net Income

(768)

(768)

(0%)

(335)

(366)

8%

Controlling Interest Net Income

206,358

237,189

(13%)

96,680

127,430

(24%)

Operating EBITDA

591,705

554,141

7%

310,095

270,740

15%

Earnings per share

372.43

427.93

(13%)

174.44

229.82

(24%)

2015 Second Quarter Results Page 7

as of June 30

BALANCE SHEET

2015

2014

% var

Total Assets

8,957,507

7,231,730

24%

Cash and Temporary Investments

151,702

111,559

36%

Trade Accounts Receivables

322,693

311,919

3%

Other Receivables

134,970

169,882

(21%)

Inventories

265,666

215,964

23%

Other Current Assets

56,468

44,984

26%

Current Assets

931,499

854,309

9%

Fixed Assets

2,888,229

2,291,516

26%

Other Assets

5,137,779

4,085,905

26%

Total Liabilities

5,259,697

4,490,719

17%

Current Liabilities

1,134,788

1,217,350

(7%)

Long-Term Liabilities

4,096,793

3,249,004

26%

Other Liabilities

28,117

24,365

15%

Consolidated Stockholders’ Equity

3,683,117

2,729,518

35%

Non-controlling Interest

14,696

11,494

28%

Stockholders’ Equity Attributable to Controlling Interest

3,697,810

2,741,012

35%

OPERATING RESULTS

Operating Summary per Country

in thousands of U.S. dollars

Operating EBITDA margin as a percentage of net sales

January - June

Second Quarter

2015

2014

% var

2015

2014

% var

NET SALES

Colombia

374,258

501,937

(25%)

198,012

259,543

(24%)

Panama

150,944

148,685

2%

79,029

72,569

9%

Costa Rica

89,483

75,996

18%

46,440

40,530

15%

Rest of CLH

141,341

143,227

(1%)

75,692

73,397

3%

Others and intercompany eliminations

(8,426)

(5,890)

(43%)

(5,411)

(4,838)

(12%)

TOTAL

747,600

863,955

(13%)

393,763

441,201

(11%)

GROSS PROFIT

Colombia

179,581

252,396

(29%)

94,088

124,798

(25%)

Panama

68,724

71,442

(4%)

37,089

36,173

3%

Costa Rica

49,634

40,351

23%

25,192

22,227

13%

Rest of CLH

50,922

50,218

1%

25,618

26,246

(2%)

Others and intercompany eliminations

7,104

5,397

32%

3,746

2,354

59%

TOTAL

355,964

419,804

(15%)

185,733

211,798

(12%)

OPERATING EARNINGS BEFORE OTHER EXPENSES, NET

Colombia

113,709

163,205

(30%)

61,079

78,655

(22%)

Panama

52,145

57,436

(9%)

28,289

29,294

(3%)

Costa Rica

36,029

29,868

21%

18,020

16,862

7%

Rest of CLH

37,119

37,440

(1%)

18,431

19,626

(6%)

Others and intercompany eliminations

(47,328)

(52,368)

10%

(24,332)

(26,923)

10%

TOTAL

191,674

235,581

(19%)

101,487

117,514

(14%)

OPERATING EBITDA

Colombia

127,582

180,792

(29%)

68,269

88,175

(23%)

Panama

61,382

66,011

(7%)

32,721

33,667

(3%)

Costa Rica

39,251

33,366

18%

19,572

18,618

5%

Rest of CLH

39,657

40,055

(1%)

19,733

21,165

(7%)

Others and intercompany eliminations

(31,523)

(37,153)

15%

(16,372)

(19,553)

16%

TOTAL

236,350

283,071

(17%)

123,923

142,072

(13%)

OPERATING EBITDA MARGIN

Colombia

34.1%

36.0%

34.5%

34.0%

Panama

40.7%

44.4%

41.4%

46.4%

Costa Rica

43.9%

43.9%

42.1%

45.9%

Rest of CLH

28.1%

28.0%

26.1%

28.8%

TOTAL

31.6%

32.8%

31.5%

32.2

205 Second Quarter Results Page 8

OPERATING RESULTS

Volume Summary

Consolidated volume summary

January - June

Second Quarter

2015

2014

% var

2015

2014

% var

Total cement volume 1

3,620

3,931

(8%)

1,880

1,964

(4%)

Total domestic gray cement volume

3,307

3,500

(6%)

1,714

1,766

(3%)

Total ready-mix volume

1,753

1,670

5%

904

851

6%

Total aggregates volume

4,369

4,145

5%

2,257

2,197

3%

1 Consolidated cement volume includes domestic and export volume of gray cement, white cement, special cement, mortar and clinker.

Cement and aggregates in thousands of metric tons Ready mix in thousands of cubic meters

Per-country volume summary

January - June

Second Quarter

Second Quarter 2015

2015 vs. 2014

2015 vs. 2014

vs. First Quarter 2015

DOMESTIC GRAY CEMENT

Colombia

(11%)

(7%)

11%

Panama

7%

4%

2%

Costa Rica

11%

14%

6%

Rest of CLH

(7%)

(6%)

5%

READY MIX

Colombia

4%

3%

8%

Panama

(0%)

10%

(0%)

Costa Rica

15%

20%

21%

Rest of CLH

21%

23%

3%

AGGREGATES

Colombia

2%

0%

6%

Panama

10%

21%

10%

Costa Rica

38%

31%

10%

Rest of CLH

2%

(25%)

1%

2015 Second Quarter Results Page 9

OPERATING RESULTS

Price Summary

Variation in U.S. dollars

January - June

Second Quarter

Second Quarter 2015

2015 vs. 2014

2015 vs. 2014

vs. First Quarter 2015

DOMESTIC GRAY CEMENT

Colombia

(21%)

(22%)

2%

Panama

1%

6%

4%

Costa Rica

5%

5%

(2%)

Rest of CLH

(2%)

(4%)

(1%)

READY MIX

Colombia

(19%)

(20%)

1%

Panama

(3%)

(3%)

(3%)

Costa Rica

(2%)

1%

4%

Rest of CLH

2%

1%

1%

AGGREGATES

Colombia

(21%)

(22%)

6%

Panama

3%

7%

4%

Costa Rica

0%

4%

6%

Rest of CLH

16%

20%

(6%)

For Rest of CLH, volume-weighted average prices.

January - June

Second Quarter

Second Quarter 2015

2015 vs. 2014

2015 vs. 2014

vs. First Quarter 2015

DOMESTIC GRAY CEMENT

Colombia

1%

2%

1%

Panama

1%

6%

4%

Costa Rica

4%

2%

(2%)

Rest of CLH

3%

2%

(0%)

READY MIX

Colombia

4%

4%

1%

Panama

(3%)

(3%)

(3%)

Costa Rica

(4%)

(2%)

4%

Rest of CLH

4%

2%

0%

AGGREGATES

Colombia

1%

3%

6%

Panama

3%

7%

4%

Costa Rica

(2%)

2%

6%

Rest of CLH

19%

23%

(6%)

For Rest of CLH, volume-weighted average prices.

Variation in local currency

2015 Second Quarter Results Page 10

DEFINITIONS OF TERMS AND DISCLOSURES

Methodology for translation and presentation of results

Under IFRS, CLH reports its consolidated results in its functional currency, which is the US Dollar, by translating the financial statements of foreign subsidiaries using the corresponding exchange rate at the reporting date for the balance sheet and the corresponding exchange rates at the end of each month for the income statement.

For the reader’s convenience, Colombian peso amounts for the consolidated entity are calculated by converting the US dollar amounts using the closing COP/US$ exchange rate at the reporting date for balance sheet purposes, and the average COP/US$ exchange rate for the corresponding period for income statement purposes. The exchange rates used to convert: (i) the balance sheet as of June 30, 2015 and June 30, 2014 was $2,585.11 and $1,881.19 Colombian pesos per US dollar, respectively, and (ii) the consolidated results for the second quarter of 2015 and for the second quarter of 2014 were $2,502.32 and $1,905.66 Colombian pesos per US dollar, respectively.

Per-country/region selected financial information of the income statement is presented before corporate charges and royalties which are included under “other and intercompany eliminations.”

Consolidated financial information

When reference is made to consolidated financial information means the financial information of CLH together with its consolidated subsidiaries.

Presentation of financial and operating information

Exchange rates

January - June

January - June

Second Quarter

2015 closing

2014 closing

2015 average

2014 average

2015 average

2014 average

Colombian peso

2,585.11

1,881.19

2,503.52

1,957.57

2,502.32

1,905.66

Panama balboa

1.00

1.00

1.00

1.00

1.00

1.00

Costa Rica colon

540.97

548.66

540.71

548.58

540.51

554.90

Euro

1.1145

0.7302

1.1080

0.7304

1.1100

0.7297

Amounts provided in units of local currency per US dollar.

Individual information is provided for Colombia, Panama and Costa Rica.

Countries in Rest of CLH include Nicaragua, Guatemala, El Salvador and Brazil.

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DEFINITIONS OF TERMS AND DISCLOSURES

Definition of terms

Free cash flow equals operating EBITDA minus net interest expense, maintenance and strategic 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).

Maintenance capital expenditures investments incurred for the purpose of ensuring CLH’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 internal policies.

Net debt equals total debt minus cash and cash equivalents.

Operating EBITDA equals operating earnings before other expenses, net, plus depreciation and operating amortization.

pp equals percentage points.

Strategic capital expenditures investments incurred with the purpose of increasing CLH’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.

Working capital equals operating accounts receivable (including other current assets received as payment in kind) plus historical inventories minus operating payables.

2015 Second Quarter Results Page 12