EX-2 3 d66220dex2.htm EX-2

EX-2

Exhibit 2

Exhibit 2

2015 FOURTH 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—December Fourth Quarter 2015 2014 % var 2015 2014 % var Consolidated cement volume 7,315 7,910 (8%) 1,818 1,924 (6%) Consolidated domestic gray cement 6,636 7,074 (6%) 1,601 1,747 (8%) Consolidated ready-mix volume 3,395 3,497 (3%) 767 872 (12%) Consolidated aggregates volume 8,447 8,671 (3%) 1,899 2,172 (13%) Net sales 1,427 1,725 (17%) 325 400 (19%) Gross profit 677 855 (21%) 156 199 (22%) as % of net sales 47.5% 49.6% (2.1pp) 48.0% 49.8% (1.8pp) Operating earnings before other expenses, net 365 481 (24%) 83 109 (24%) as % of net sales 25.6% 27.9% (2.3pp) 25.6% 27.3% (1.7pp) Controlling interest net income (loss) 95 273 (65%) -22 64 N/A Operating EBITDA 450 577 (22%) 103 134 (23%) as % of net sales 31.5% 33.5% (2.0pp) 31.8% 33.5% (1.7pp) Free cash flow after maintenance capital expenditures 249 252 (1%) 61 0 N/A Free cash flow 105 172 (39%) 27 -40 N/A Net debt 1,034 1,140 (9%) 1,034 1,140 (9%) Total debt 1,088 1,191 (9%) 1,088 1,191 (9%) Earnings per share 0.17 0.46 (62%) (0.04) 0.12 N/A Shares outstanding at end of period 556 556 0% 556 556 0% Employees 4,813 4,915 (2%) 4,813 4,915 (2%) Employees 4,813 4,915 (2%) 4,813 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 fourth quarter of 2015 declined by 19% compared to the fourth quarter of 2014. For the full year consolidated net sales decreased by 17%, 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 and Panama. Cost of sales as a percentage of net sales during 2015 increased by 2.1pp from 50.4% to 52.5% on a year-over-year basis. Operating expenses as a percentage of net sales during the 2015 increased by 0.2pp from 21.7% to 21.9% compared to the same period in 2014. Operating EBITDA during the fourth quarter of 2015 declined by 23% compared to the fourth quarter of 2014. During the full year operating EBITDA decreased by 22%, 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 and Panama. Operating EBITDA margin during the fourth quarter of 2015 declined by 1.7pp, compared to the fourth quarter of 2014. During 2015 operating EBITDA margin declined by 2.0pp compared with the same period last year. Controlling interest net income during 2015 reached US$95 million, declining 65% compared to the same period in 2014. During the fourth quarter 2015 we registered a Controlling interest net loss of US$22 million, compared to a net income of US$64 million in the same period in 2014 Total debt at the end of the year reached US$1,088 million.

OPERATING RESULTS Colombia January - December Fourth Quarter 2015 2014 % var 2015 2014 % var Net sales 725 993 (27%) 173 225 (23%) Operating EBITDA 248 363 (32%) 60 82 (27%) Operating EBITDA margin 34.2% 36.5% (2.3pp) 34.4% 36.6% (2.2pp) In millions of US dollars, except percentages. Domestic gray cement Ready-Mix Aggregates January - January - January - December Fourth Quarter December Fourth Quarter December Fourth Quarter Volume (9%) (8%) (3%) (11%) (6%) (16%) Price (USD) (22%) (15%) (23%) (23%) (23%) (21%) Price (local currency) 8% 18% 6% 7% 4% 9% Year-over-year percentage variation. In Colombia, during the fourth quarter our domestic gray cement, ready-mix and aggregates volumes declined by 8%, 11% and 16% respectively, compared to the fourth quarter of 2014. For the full year, our domestic gray cement, ready-mix and aggregates volumes decreased by 9%, 3% and 6%, respectively, compared to 2014. Our volume performance both during the fourth quarter and during the year is mainly explained by a tough comparison base in 2014, as well as by our value before volume strategy in the country. During the fourth quarter our prices in local currency increased sequentially by 5 percentage points, and by 18 percentage points compared with the fourth quarter of 2014. Panama January - December Fourth Quarter 2015 2014 % var 2015 2014 % var Net sales 285 315 (10%) 61 74 (18%) Operating EBITDA 117 140 (16%) 26 31 (18%) Operating EBITDA margin 41.2% 44.3% (3.1pp) 42.4% 42.5% (0.1pp) In millions of US dollars, except percentages. Domestic gray cement Ready-Mix Aggregates January - January - January - December Fourth Quarter December Fourth Quarter December Fourth Quarter Volume (9%) (22%) (12%) (24%) (0%) (19%) Price (USD) 4% 5% (4%) (6%) 3% 2% Price (local currency) 4% 5% (4%) (6%) 3% 2% Year-over-year percentage variation. In Panama during the fourth quarter our domestic gray cement, ready-mix and aggregates volumes decreased by 22%, 24% and 19% respectively, compared to the fourth quarter of 2014. For 2015, our domestic gray cement and ready-mix volumes decreased by 9% and 12% respectively, while our aggregates volumes remained flat, compared to 2014. During the year, the negative performance in our volumes is mainly explained by lower sales to the Panama Canal expansion project, the completion of some large infrastructure projects, as well as a slow-down in the process of approval of construction licenses, and in execution of new infrastructure projects. Cement sales to the Panama Canal expansion project declined by 80% and 55% during the quarter and for the full year, respectively, on a year-over-year basis.

OPERATING RESULTS Costa Rica January—December Fourth Quarter 2015 2014 % var 2015 2014 % var Net sales 167 153 9% 36 39 (7%) Operating EBITDA 69 69 (0%) 15 18 (18%) Operating EBITDA margin 41.3% 45.4% (4.1pp) 41.5% 46.9% (5.4pp) In millions of US dollars, except percentages. Domestic gray cement Ready-Mix Aggregates January—January—January— December Fourth Quarter December Fourth Quarter December Fourth Quarter Volume 7% (9%) 14% 13% 16% 4% Price (USD) 3% (1%) (1%) 4% (3%) (11%) Price (local currency) 1% (2%) (3%) 4% (4%) (12%) Price (local currency) 1% (2%) (3%) 4% (4%) (12%) Year-over-year percentage variation. In Costa Rica, during the fourth quarter our domestic gray cement volumes declined by 9%, while our ready-mix, and aggregates volumes increased by 13% and 4%, respectively, compared to the fourth quarter of 2014. For the full year our domestic gray cement, ready-mix and aggregates volumes increased by 7%, 14% and 16%, respectively, compared to 2014. Our cement volumes for the full year 2015 were positive affected by construction of roads, as well as hydroelectric projects like “Chucás”. However, the negative performance in cement volumes during the fourth quarter versus the same quarter in 2014 reflects a decline in dispatches for this sector. Rest of CLH January—December Fourth Quarter 2015 2014 % var 2015 2014 % var Net sales 269 277 (3%) 60 67 (10%) Operating EBITDA 73 78 (7%) 16 18 (15%) Operating EBITDA margin 27.1% 28.3% (1.2pp) 25.9% 27.5% (1.6pp) In millions of US dollars, except percentages. Domestic gray cement Ready-Mix Aggregates January—January—January— December Fourth Quarter December Fourth Quarter December Fourth Quarter Volume (2%) 2% 13% (8%) 13% 29% Price (USD) (6%) (9%) 0% 1% 8% (1%) Price (local currency) 1% (1%) 2% 3% 11% 3% Year-over-year percentage variation. In the Rest of CLH region, which includes our operations in Nicaragua, Guatemala, El Salvador and Brazil, during the fourth quarter of 2015 our domestic gray cement and aggregates volumes increased by 2% and 29%, respectively, while our ready-mix volumes declined by 8%, compared to the fourth quarter of 2014. During 2015, our domestic gray volumes decreased by 2%, while our ready-mix and aggregates volumes increased by 13% and 13% respectively, compared to 2014. The positive performance in our cement volumes in Nicaragua and ready-mix in Guatemala was offset by weak demand conditions in the other markets, especially by the results in our operations in Brazil. Housing and infrastructure in Nicaragua, along with industrial-and-commercial activity in Guatemala, remained the main drivers of demand for our products.

OPERATING EBITDA, FREE CASH FLOW AND DEBT RELATED INFORMATION Operating EBITDA and free cash flow January—December Fourth Quarter 2015 2014 % var 2015 2014 % var Operating earnings before other expenses, net 365 481 (24%) 84 109 (23%) + Depreciation and operating amortization 85 96 20 25 Operating EBITDA 450 577 (22%) 104 134 (22%)—Net financial expense 74 90 16 15—Capital expenditures for maintenance 52 63 26 25 —Change in working Capital (44) 64 (20) 67 —Taxes paid 107110 20 29—Other cash items (Net) 12 (2) 1 (2) Free cash flow after maintenance capital exp 249 252 (1%) 61 —n/a—Strategic Capital expenditures 144 80 34 40 Free cash flow 105 172 (39%) 27 (40) n/a In millions of US dollars, except percentages. Information on Debt Third Fourth Quarter Quarter Fourth Quarter 2015 2014 % var 2015 2015 2014 Total debt 1, 2 1,088 1,191 (9%) 1,118 Currency denomination Short term 24% 12% 13% U.S. dollar 99% 99% Long term 76% 88% 87% Colombian peso 1% 1% Cash and cash equivalents (54) 52 n/a 58 Interest rate Net debt 1,034 1,140 (9%) 1,060 Fixed 77% 79% Variable 23% 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 Fourth Quarter Results Page 5

OPERATING RESULTS Income statement & balance sheet CEMEX Latam Holdings, S.A. and Subsidiaries in thousands of U.S. Dollars, except per share amounts January—December Fourth Quarter INCOME STATEMENT 2015 2014 % var 2015 2014 % var Net sales 1,427,058 1,724,710 (17%) 324,978 400,412 (19%) Cost of sales (749,646) (869,388) 14% (168,881) (201,094) 16% Gross profit 677,412 855,322 (21%) 156,097 199,318 (22%) Operating expenses (312,594) (374,191) 16% (72,745) (90,103) 19% Operating earnings before other expenses, net 364,818 481,131 (24%) 83,352 109,215 (24%) Other expenses, net (83,360) (2,758) (2922%) (70,453) 1,105 N/A Operating earnings 281,458 478,373 (41%) 12,899 110,320 (88%) Financial expenses (73,748) (90,449) 18% (15,476) (15,229) (2%) Other income (expenses), net (19,189) 31,153 N/A (1,267) 25,589 N/A Net income before income taxes 188,521 419,077 (55%) (3,844) 120,680 N/A Income tax (92,469) (144,706) 36% (17,643) (56,113) 69% Consolidated net income 96,052 274,371 (65%) (21,487) 64,567 N/A Non-controlling Interest Net Income (561) (973) 42% (146) (122) (20%) Controlling Interest Net Income 95,491 273,398 (65%) (21,633) 64,445 N/A 0 0 Operating EBITDA 449,772 576,940 (22%) 103,489 134,101 (23%) Earnings per share 0.17 0.46 (62%) (0.04) 0.12 N/A as of December 31 BALANCE SHEET 2015 2014 % var Total Assets 3,196,930 3,483,940 (8%) Cash and Temporary Investments 53,635 51,772 4% Trade Accounts Receivables 91,568 122,003 (25%) Other Receivables 41,611 33,752 23% Inventories 86,134 102,821 (16%) Other Current Assets 14,421 18,347 (21%) Current Assets 287,369 328,695 (13%) Fixed Assets 1,093,359 1,114,921 (2%) Other Assets 1,816,202 2,040,324 (11%) Total Liabilities 1,880,115 2,083,007 (10%) Current Liabilities 524,245 406,913 29% Long-Term Liabilities 1,347,340 1,664,719 (19%) Other Liabilities 8,530 11,375 (25%) Consolidated Stockholders’ Equity 1,316,815 1,400,933 (6%) Non-controlling Interest 5,329 5,762 (8%) Stockholders’ Equity Attributable to Controlling Interest 1,311,486 1,395,171 (6%) 2015 Fourth 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—December Fourth Quarter INCOME STATEMENT 2015 2014 % var 2015 2014 % var Net sales 3,955,161 3,480,196 14% 991,012 887,470 12% Cost of sales (2,077,681) (1,754,289) (18%) (514,996) (445,697) (16%) Gross profit 1,877,480 1,725,907 9% 476,016 441,773 8% Operating expenses (866,371) (755,058) (15%) (221,829) (199,717) (11%) Operating earnings before other expenses, net 1,011,109 970,849 4% 254,187 242,056 5% Other expenses, net (231,036) (5,565) (4051%) (214,844) 2,448 N/A Operating earnings 780,073 965,284 (19%) 39,343 244,504 (84%) Financial expenses (204,397) (182,510) (12%) (47,195) (33,746) (40%) Other income (expenses), net (53,183) 62,859 N/A (3,860) 56,710 N/A Net income before income taxes 522,493 845,633 (38%) (11,712) 267,468 N/A Income tax (256,281) (291,995) 12% (53,801) (124,372) 57% Consolidated net income 266,212 553,638 (52%) (65,516) 143,096 N/A Non-controlling Interest Net Income (1,555) (1,966) 21% (446) (275) (62%) Controlling Interest Net Income 264,657 551,672 (52%) (65,959) 142,821 N/A Operating EBITDA 1,246,566 1,164,178 7% 315,587 297,219 6% Earnings per share 478.65 995.51 (52%) (117.80) 257.34 N/A as of December 31 BALANCE SHEET 2015 2014 % var Total Assets 10,068,638 8,352,754 21% Cash and Temporary Investments 168,921 123,862 36% Trade Accounts Receivables 288,391 291,887 (1%) Other Receivables 131,054 80,752 62% Inventories 271,276 245,996 10% Other Current Assets 45,420 43,893 3% Current Assets 905,062 786,390 15% Fixed Assets 3,443,503 2,667,404 29% Other Assets 5,720,073 4,898,960 17% Total Liabilities 5,921,365 5,001,075 18% Current Liabilities 1,651,092 973,524 70% Long-Term Liabilities 4,243,408 4,000,337 6% Other Liabilities 26,865 27,214 (1%) Consolidated Stockholders’ Equity 4,147,273 3,351,679 24% Non-controlling Interest 16,785 13,786 22% Stockholders’ Equity Attributable to Controlling Interest 4,130,488 3,337,893 24% 2015 Fourth Quarter Results Page 7

OPERATING RESULTS Operating Summary per Country in thousands of U.S. dollars Operating EBITDA margin as a percentage of net sales January—December Fourth Quarter 2015 2014 % var 2015 2014 % var NET SALES Colombia 724,709 993,322 (27%) 173,386 224,693 (23%) Panama 284,527 315,244 (10%) 60,611 73,983 (18%) Costa Rica 166,931 152,503 9% 35,972 38,773 (7%) Rest of CLH 268,542 276,729 (3%) 59,993 66,572 (10%) Others and intercompany eliminations (17,651) (13,088) (35%) (4,984) (3,608) (38%) TOTAL 1,427,058 1,724,710 (17%) 324,978 400,412 (19%) GROSS PROFIT Colombia 345,343 499,268 (31%) 82,240 113,278 (27%) Panama 131,677 153,431 (14%) 28,974 35,078 (17%) Costa Rica 87,483 83,587 5% 18,716 22,026 (15%) Rest of CLH 96,552 99,990 (3%) 21,278 24,221 (12%) Others and intercompany eliminations 16,357 19,046 (14%) 4,889 4,715 4% TOTAL 677,412 855,322 (21%) 156,097 199,318 (22%) OPERATING EARNINGS BEFORE OTHER EXPENSES, NET Colombia 222,069 327,049 (32%) 53,513 73,184 (27%) Panama 98,763 122,196 (19%) 21,214 26,724 (21%) Costa Rica 62,652 62,345 0% 13,392 16,488 (19%) Rest of CLH 67,653 73,354 (8%) 14,084 17,148 (18%) Others and intercompany eliminations (86,319) (103,813) 17% (18,851) (24,329) 23% TOTAL 364,818 481,131 (24%) 83,352 109,215 (24%) OPERATING EBITDA Colombia 248,153 362,922 (32%) 59,651 82,244 (27%) Panama 117,241 139,785 (16%) 25,715 31,442 (18%) Costa Rica 68,983 69,297 (0%) 14,917 18,176 (18%) Rest of CLH 72,777 78,328 (7%) 15,530 18,319 (15%) Others and intercompany eliminations (57,382) (73,392) 22% (12,324) (16,080) 23% TOTAL 449,772 576,940 (22%) 103,489 134,101 (23%) OPERATING EBITDA MARGIN Colombia 34.2% 36.5% 34.4% 36.6% Panama 41.2% 44.3% 42.4% 42.5% Costa Rica 41.3% 45.4% 41.5% 46.9% Rest of CLH 27.1% 28.3% 25.9% 27.5% TOTAL 31.5% 33.5% 31.8% 33.5% 2015 Fourth Quarter Results Page 8

OPERATING RESULTS Volume Summary Consolidated volume summary Cement and aggregates in thousands of metric tons Ready mix in thousands of cubic meters January—December Fourth Quarter 2015 2014 % var 2015 2014 % var Total cement volume 1 7,315 7,910 (8%) 1,818 1,924 (6%) Total domestic gray cement volume 6,636 7,074 (6%) 1,601 1,747 (8%) Total ready-mix volume 3,395 3,497 (3%) 767 872 (12%) Total aggregates volume 8,447 8,671 (3%) 1,899 2,172 (13%) 1 Consolidated cement volume includes domestic and export volume of gray cement, white cement, special cement, mortar and clinker. Per-country volume summary January—December Fourth Quarter Fourth Quarter 2015 2015 vs. 2014 2015 vs. 2014 vs. Third Quarter 2015 DOMESTIC GRAY CEMENT Colombia (9%) (8%) (3%) Panama (9%) (22%) (21%) Costa Rica 7% (9%) (19%) Rest of CLH (2%) 2% (4%) READY-MIX Colombia (3%) (11%) (11%) Panama (12%) (24%) (19%) Costa Rica 14% 13% (3%) Rest of CLH 13% (8%) (21%) AGGREGATES Colombia (6%) (16%) (11%) Panama (0%) (19%) (21%) Costa Rica 16% 4% 7% Rest of CLH 13% 29% (23%) 2015 Fourth Quarter Results Page 9

OPERATING RESULTS Price Summary Variation in U.S. dollars January—December Fourth Quarter Fourth Quarter 2015 2015 vs. 2014 2015 vs. 2014 vs. Third Quarter 2015 DOMESTIC GRAY CEMENT Colombia (22%) (15%) 4% Panama 4% 5% (1%) Costa Rica 3% (1%) 0% Rest of CLH (6%) (9%) (2%) READY-MIX Colombia (23%) (23%) (1%) Panama (4%) (6%) (2%) Costa Rica (1%) 4% 6% Rest of CLH 0% 1% 1% AGGREGATES Colombia (23%) (21%) 1% Panama 3% 2% 2% Costa Rica (3%) (11%) (11%) Rest of CLH 8% (1%) 7% For Rest of CLH, volume-weighted average prices. Variation in local currency January—December Fourth Quarter Fourth Quarter 2015 2015 vs. 2014 2015 vs. 2014 vs. Third Quarter 2015 DOMESTIC GRAY CEMENT Colombia 8% 18% 5% Panama 4% 5% (1%) Costa Rica 1% (2%) 0% Rest of CLH 1% (1%) (2%) READY-MIX Colombia 6% 7% 0% Panama (4%) (6%) (2%) Costa Rica (3%) 4% 6% Rest of CLH 2% 3% 1% AGGREGATES Colombia 4% 9% 2% Panama 3% 2% 2% Costa Rica (4%) (12%) (11%) Rest of CLH 11% 3% 8% For Rest of CLH, volume-weighted average prices. 2015 Fourth 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 December 31, 2015 and December 31, 2014 was $3,149.47 and $2,392.46 Colombian pesos per US dollar, respectively, and (ii) the consolidated results for the fourth quarter of 2015 and for the fourth quarter of 2014 were $3,049.47 and $2,216.39 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 Individual information is provided for Colombia, Panama and Costa Rica. Countries in Rest of CLH include Nicaragua, Guatemala, El Salvador and Brazil. Exchange rates January—December January—December Fourth Quarter 2015 closing 2014 closing 2015 average 2014 average 2015 average 2014 average Colombian peso 3,149.47 2,392.46 2,771.55 2,017.84 3,049.47 2,216.39 Panama balboa 1.00 1.00 1.00 1.00 1.00 1.00 Costa Rica colon 544.87 545.53 540.97 546.48 541.34 543.81 Euro 1.0864 0.8263 1.1016 0.7583 1.0864 0.8071 Amounts provided in units of local currency per US dollar. 2015 Fourth Quarter Results Page 11

OTHER ACTIVITIES AND INFORMATION Employee stock-ownership plan To better align our executives’ interests with those of our stockholders, on January 16, 2013, the CEMEX Latam Holdings’ Board of Directors, considering the positive report of the Board’s Nominating and Compensation Commission, approved, effective January 1, 2013, a long-term incentives plan to certain executives of CEMEX Latam Holdings, which consists of an annual compensation plan based on the CEMEX Latam Holdings’ shares. The underlying shares in this long-term incentives plan, which are held in the company’s treasury, are delivered fully vested under each annual program over a service period of four years. During 2015, the company delivered 242,618 shares to eligible executives under this long-term incentives plan. CLH announced Board of Directors Decisions CLH announced that at the meeting of the Board of Directors of the Company held on December 15, 2015 at 15:00 hours in Madrid (time in Madrid, Spain) in the corporate domicile of the Company, the relevant decisions indicated below were made, presenting and approving: 1. The appointment, prior favorable report of the Nominating and Compensation Committee, of the director Jaime Muguiro Domínguez as the President of the Board of Directors and of the director Jaime Elizondo Chapa as Vice-president of the Board of Directors. Such appointments have been agreed as a consequence of the resignation presented by Jaime Elizondo Chapa as the President of the Board of Directors and by Juan Pablo San Agustín Rubio as Vice-president of the Board of Directors, both resignations derived from the organizational changes produced inside the Cemex Group and in order to continue guaranteeing the correct operation of the Board of Directors. 2. The appointment, prior favorable report of the Nominating and Compensation Committee, of Jaime Muguiro Domínguez as Managing Director of the Company as a consequence of the resignation made by Jaime Elizondo Chapa of his delegated functions. The mentioned resignation is motivated by the new appointment of positions inside the Board of Directors mentioned in the first point above. 3. The appointment of the director Jaime Elizondo Chapa as member and Secretary of the Nominating and Compensation Committee, as a consequence of the resignation made by the director Ignacio Madridejos Fernández in such positions. The mentioned resignations are as a consequence of the organization changes produced inside the CEMEX Group and in order to continue guaranteeing the correct operation of the Nominating and Compensation Committee. 4. The appointment of Juan Fernando Enríquez Martell substituting Edgar Claudio Ángeles as Vice-president of Operations of the Company, prior favorable report of the Nominating and Compensation Committee. The mentioned appointment will be effective as of January 1, 2016. 2015 Fourth Quarter Results Page 12

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 Fourth Quarter Results Page 13