EX-99.2 3 d674280dex992.htm FOURTH QUARTER 2018 RESULTS FOR CEMEX HOLDINGS PHILIPPINES, INC.

Exhibit 2

2018 FOURTH QUARTER RESULTS â–ª Stock Listing Information Philippine Stock Exchange Ticker: CHP â–ª Investor Relations + 632 849 3600 E-Mail: chp.ir@cemex.com

Operating and Financial Highlights January—December Fourth Quarter 2018 2017 % var 2018 2017 % var Net sales 23,418 21,784 7% 5,513 5,223 6% Gross profit 9,111 9,384 (3%) 1,898 2,168 (12%) as % of net sales 39% 43% (4pp) 34% 42% (7pp) Operating earnings before other expenses, net 1,366 1,987 (31%) 43 315 (86%) as % of net sales 6% 9% (3pp) 1% 6% (5pp) Controlling Interest Net Income (Loss) (930) 659 N/A (325) (29) (1016%) Operating EBITDA 2,783 3,256 (15%) 372 628 (41%) as % of net sales 12% 15% (3pp) 7% 12% (5pp) Free cash flow after maintenance capital expenditures 1,029 1,232 (16%) (578) (270) (114%) Free cash flow 733 747 (2%) (640) (314) (104%) 1 15,563 14,138 10% 15,563 14,138 10% Net debt 1 17,377 15,196 14% 17,377 15,196 14% Total debt 2 (0.18) 0.13 N/A (0.06) (0.01) (1016%) Earnings per share In millions of Philippine Pesos, except percentages and earnings per share 1 U.S. dollar debt converted using end-of-period exchange rate. See Debt Information on page 4 and Exchange Rates on page 7 for more detail. 2 In Philippine Pesos Net sales increased by 6% year-over-year during the quarter due to Selling and administrative expenses, as a percentage of sales, declined higher prices. For 2018, net sales grew 7% compared to 2017, resulting by 1 pp in 2018 due to efforts to optimize costs and lower marketing from higher volumes and prices. expenses. Cost of sales was at 66% of sales during the fourth quarter of 2018 Operating EBITDA decreased by 41% during the quarter. 2018 versus 58% in the same period of 2017. The increase was due to higher operating EBITDA decreased by 15% compared to 2017. raw material costs as APO Cement Plant used raw materials from other sources following the landslide in Naga, Cebu. Excluding the impact of Operating EBITDA margin during the quarter was 7%, 5 pp lower than the landslide, fourth quarter 2018 cost of sales is estimated to have in the same period last year. Margins were affected by increased raw been at 59% of sales. material costs as APO Cement Plant used alternative raw materials from other sources following the landslide in Naga, Cebu. This impact was Fuel costs and power costs accounted for 12% and 17% of cost of sales partially offset by the price increase implemented in November. during the fourth quarter of 2018, compared to 25% and 21% in the same period of 2017, respectively, due to disrupted kiln operations Operating EBITDA margin for 2018 was 12%. following the landslide. Controlling interest net income for the quarter recorded a loss of PHP For 2018, cost of sales was at 61% of sales against 57% in 2017. This was 325 million, mainly due to lower operating EBITDA, higher financial mainly driven by increased raw material costs due to the landslide, and expenses, and higher income tax expenses. higher fuel and power costs, resulting from increased global fuel prices and the impact of the tax reform. Excluding the impact of the landslide, For 2018, the company incurred a loss of PHP 930 million due to higher 2018 cost of sales is estimated to have been at 60% of sales. income tax expenses recorded in the second quarter, lower operating EBITDA, and higher foreign exchange losses. Operating expenses, as a percentage of sales, decreased in 2018 by 1 pp compared to 2017. Total debt at the end of December 2018 stood at PHP 17,378 million, of which PHP 13,767 million pertained to long-term debt owed to BDO Distribution expenses, as a percentage of sales, decreased by 2 pp year- Unibank, Inc. over-year during the quarter mainly due to optimization of vessel charter agreements. For 2018, distribution expenses, as a percentage of sales, were flat year-over-year. Initiatives to increase operational efficiency mitigated higher fuel costs and other inputs. 2018 Fourth Quarter Results Page 2

Operating Results Domestic Gray Cement January—December Fourth Quarter Fourth Quarter 2018 2018 vs. 2017 2018 vs. 2017 vs. Third Quarter 2018 Volume 7% 0% (10%) Price in PHP 1% 6% 1% Our domestic cement volumes were flat year-over-year during the quarter as volume performance was affected by production constraints caused by the landslide in Naga, Cebu, near our APO Cement Plant. Industry demand remained robust driven by demand from both the private and public sectors. Our absolute domestic cement volumes were an all-time high in 2018, as volumes grew 7% year-over-year aided by debottlenecking initiatives to increase production and supply chain throughput by half a million tons. This performance also reflects increased construction activity from both public and private sectors. Our domestic cement prices were 6% higher during the quarter versus previous year same period. Sequentially, domestic cement prices were 1% higher, reflecting adjustments for increased input costs. 2018 Fourth Quarter Results Page 3

Operating EBITDA, Free Cash Flow and Debt Information Operating EBITDA and Free Cash Flow January—December Fourth Quarter 2018 2017 % var 2018 2017 % var Operating earnings before other expenses, net 1,366 1,987 (31%) 43 315 (86%) + Depreciation and operating amortization 1,416 1,269 330 313 Operating EBITDA 2,783 3,256 (15%) 372 628 (41%) —Net financial expenses 952 895 275 228—Maintenance capital expenditures 1,145 844 652 431—Change in working capital (886) (116) (108) 232—Income taxes paid 500 553 80 129—Other cash items (net) 43 (153) 51 (122) Free cash flow after maintenance capital expenditures 1,029 1,232 (16%) (578) (270) (114%)—Strategic capital expenditures 295 485 62 43 Free cash flow 733 747 (2%) (640) (314) (104%) In millions of Philippine Pesos Debt Information Fourth Quarter Third Quarter Fourth Quarter 2018 2017 % var 2018 2018 2017 1 17,377 15,196 14% 15,270 Currency denomination Total debt 7% 2% 4% 2 15% 1% Short term U.S. dollar Long term 93% 98% 96% Philippine peso 85% 99% Cash and cash equivalents 1,814 1,058 71% 2,517 Interest rate Net debt 15,563 14,138 10% 12,753 Fixed 38% 43% Variable 62% 57% In millions of Philippine Pesos, except percentages 1 U.S. dollar debt converted using end-of-period exchange rate. See Exchange Rates on page 7 for more detail. 2 Pertains to related party loans with CEMEX Asia B.V. 2018 Fourth Quarter Results Page 4

Financial Results Income Statement & Balance Sheet Information CEMEX Holdings Philippines, Inc. (Thousands of Philippine Pesos in nominal terms, except per share amounts) January—December Fourth Quarter INCOME STATEMENT 2018 2017 % var 2018 2017 % var Net sales 23,417,697 21,784,450 7% 5,512,576 5,223,198 6% Cost of sales (14,307,126) (12,400,901) (15%) (3,614,867) (3,054,759) (18%) Gross profit 9,110,571 9,383,549 (3%) 1,897,709 2,168,439 (12%) Selling and Administrative expenses (3,008,799) (3,079,349) 2% (806,855) (778,313) (4%) Distribution expenses (4,735,330) (4,317,633) (10%) (1,047,985) (1,074,672) 2% Operating earnings before other expenses, net 1,366,442 1,986,567 (31%) 42,869 315,454 (86%) Other income (expenses), net (42,653) (226,180) 81% (50,889) (257,280) 80% Operating earnings (loss) 1,323,789 1,760,387 (25%) (8,020) 58,174 N/A Financial expenses, net (951,945) (895,295) (6%) (275,400) (228,192) (21%) Foreign exchange gain (loss), net (331,009) (66,738) (396%) 139,464 90,470 54% Net income (loss) before income taxes 40,835 798,354 (95%) (143,956) (79,548) (81%) Income tax benefit (expenses) (970,993) (139,544) (596%) (181,475) 50,397 N/A Consolidated net income (loss) (930,158) 658,810 N/A (325,431) (29,151) (1016%) Non-controlling interest net income (loss) 95 25 280% 73 4 1725% Controlling Interest net income (loss) (930,063) 658,835 N/A (325,358) (29,147) (1016%) Operating EBITDA 2,782,866 3,255,800 (15%) 372,482 628,342 (41%) Earnings per share (0.18) 0.13 N/A (0.06) (0.01) (1016%) as of December 31 BALANCE SHEET 2018 2017 % Var Total Assets 55,698,101 51,751,676 8% Cash and Temporary Investments 1,813,665 1,058,267 71% Trade Accounts Receivables 708,906 833,259 (15%) Other Receivables 1,053,379 101,002 943% Inventories 3,488,178 3,258,252 7% Assets held for sale 0 90,629 Other Current Assets 1,690,546 1,310,504 29% Current Assets 8,754,674 6,651,913 32% Fixed Assets 15,617,365 15,582,732 0% Investments in an associate and other investments 14,097 15,407 (9%) Other assets and noncurrent accounts receivables 2,887,848 716,700 303% Deferred income taxes—net 564,423 925,230 (39%) Goodwill 27,859,694 27,859,694 0% Other Assets 31,326,062 29,517,031 6% Total Liabilities 26,825,821 22,329,280 20% Current Liabilities 10,080,385 6,873,552 47% Long-Term Liabilities 16,009,642 14,674,110 9% Other Liabilities 735,794 781,618 (6%) Consolidated Stockholders’ Equity 28,872,280 29,422,396 (2%) Non-controlling Interest 193 221 (13%) Stockholders’ Equity Attributable to Controlling Interest 28,872,087 29,422,175 (2%) 2018 Fourth Quarter Results Page 5

Financial Results Income Statement & Balance Sheet Information CEMEX Holdings Philippines, Inc. (Thousands of U.S. Dollars, except per share amounts) January—December Fourth Quarter INCOME STATEMENT 2018 2017 % var 2018 2017 % var Net sales 444,422 432,388 3% 104,296 103,218 1% Cost of sales (271,521) (246,139) (10%) (68,392) (60,367) (13%) Gross profit 172,901 186,249 (7%) 35,904 42,851 (16%) Selling and Administrative expenses (57,101) (61,121) 7% (15,265) (15,382) 1% Distribution expenses (89,867) (85,698) (5%) (19,828) (21,237) 7% Operating earnings before other expenses, net 25,933 39,430 (34%) 811 6,232 (87%) Other income (expenses), net (809) (4,489) 82% (963) (5,084) 81% Operating earnings (loss) 25,124 34,941 (28%) (152) 1,148 N/A Financial expenses, net (18,066) (17,770) (2%) (5,210) (4,509) (16%) Foreign exchange gain (loss), net (6,282) (1,325) (374%) 2,639 1,788 48% Net income (loss) before income taxes 776 15,846 (95%) (2,723) (1,573) (73%) Income tax benefit (expenses) (18,428) (2,770) (565%) (3,433) 996 N/A Consolidated net income (loss) (17,652) 13,076 N/A (6,156) (577) (967%) Non-controlling interest net income (loss) 2 0 1 0 Controlling Interest net income (loss) (17,650) 13,076 N/A (6,155) (577) (967%) Operating EBITDA 52,813 64,623 (18%) 7,047 12,417 (43%) as of December 31 BALANCE SHEET 2018 2017 % Var Total Assets 1,059,302 1,036,485 2% Cash and Temporary Investments 34,493 21,195 63% Trade Accounts Receivables 13,482 16,689 (19%) Other Receivables 20,034 2,023 890% Inventories 66,340 65,256 2% Assets held for sale 0 1,815 Other Current Assets 32,153 26,247 23% Current Assets 166,502 133,225 25% Fixed Assets 297,021 312,092 (5%) Investments in an associate and other investments 268 309 (13%) Other assets and noncurrent accounts receivables 54,923 14,353 283% Deferred income taxes—net 10,735 18,531 (42%) Goodwill 529,853 557,975 (5%) Other Assets 595,779 591,168 1% Total Liabilities 510,191 447,212 14% Current Liabilities 191,715 137,663 39% Long-Term Liabilities 304,482 293,894 4% Other Liabilities 13,994 15,655 (11%) Consolidated Stockholders’ Equity 549,110 589,273 (7%) Non-controlling Interest 4 4 (10%) Stockholders’ Equity Attributable to Controlling Interest 549,106 589,269 (7%) 2018 Fourth Quarter Results Page 6

Definitions of Terms and Disclosures Methodology for translation, consolidation, and presentation of Definition of terms results PHP refers to Philippine Pesos. CEMEX Holdings Philippines, Inc. (“CHP”) reports its consolidated financial statements under Philippine Financial Reporting Standards pp equals percentage points. (“PFRS”). When reference is made in 2018 and 2017 to consolidated financial statements, it means CHP financial information together with Prices all references to pricing initiatives, price increases or decreases, its subsidiaries. refer to our prices for our products. For the purpose of presenting figures in U.S. dollars, the consolidated Operating EBITDA equals operating earnings before other expenses, balance sheet as of December 31, 2018 has been converted at the end net, plus depreciation and operating amortization. of period exchange rate of 52.58 Philippine pesos per US dollar while the consolidated income statement for the twelve-month period ended Free cash flow equals operating EBITDA minus net interest expense, December 31, 2018 has been converted at the January to December maintenance and strategic capital expenditures, change in working 2018 average exchange rate of 52.69 Philippine pesos per US dollar. On capital, taxes paid, and other cash items (net other expenses less the other hand, the consolidated income statement for the three- proceeds from the disposal of obsolete and/or substantially depleted month period ended December 31, 2018 has been converted at the operating fixed assets that are no longer in operation). October to December 2018 average exchange rate of 52.86 Philippine Maintenance capital expenditures investments incurred for the purpose pesos per US dollar. 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. 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. Change in Working capital in the Free cash flow statements only include trade receivables, trade payables, receivables and payables from and to related parties, other current receivables, inventories, other current assets, and other accounts payable and accrued expense. Net debt equals total debt minus cash and cash equivalents. Exchange Rates January—December Fourth Quarter January—December 2018 2017 2018 2017 2018 2017 average average average average End of period End of period Philippine peso 52.69 50.38 52.86 50.60 52.58 49.93 Amounts provided in units of local currency per US dollar 2018 Fourth Quarter Results Page 7