EX-99.2 3 d718960dex992.htm FIRST QUARTER 2019 RESULTS FOR CEMEX HOLDINGS PHILIPPINES, INC.

First quarter 2019 results for CEMEX Holdings Philippines, Inc.

Exhibit 2

2019 FIRST 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

2019 First Quarter Results Page 2 Operating and Financial Highlights 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 8 for more detail. 2 In Philippine Pesos Net sales increased by 6% year-over-year during the quarter due to higher prices, a result of price adjustments implemented during 2018. Cost of sales was at 63% of sales during the quarter versus 58% in the same period of 2018. The increase was mainly due to scheduled kiln maintenance in Solid Cement plant, and cement imports and outsourced clinker carried over resulting from the Naga landslide incident. Fuel costs accounted for 18% of cost of sales, a decrease of 8 pp year-over-year due to use of hedged coal inventory and Solid kiln maintenance. Power costs accounted for 18% of cost of sales, a decrease of 4 pp year-over-year resulting from more competitive contracted power rates and lower power consumption. Operating expenses, as a percentage of sales, during the quarter decreased by 5 pp compared to the same period in 2018. Distribution expenses, as a percentage of sales, decreased by 4 pp year-over-year mainly due to supply-chain-optimization initiatives, and higher sales from cement imports carried over resulting from the Naga landslide incident. Selling and administrative expenses, as a percentage of sales, decreased by 1 pp year-over-year. Operating EBITDA during the quarter increased by 7% year-over-year due to savings in distribution expenses, while increased cost of sales were mitigated by higher year-over-year prices. Operating EBITDA margin during the quarter was flat year-over-year at 17%. Controlling interest net income for the quarter was 137% higher year-over-year at PHP 172 million mainly due to lower foreign-exchange losses and higher operating earnings. Total debt at the end of March 2019 stood at PHP 19,031 million, of which PHP 13,232 million pertained to long-term debt owed to BDO Unibank, Inc. 20192018% var20192018% varNet sales6,2375,8916%6,2375,8916%Gross profit2,2972,450 (6%)2,2972,450 (6%) as % of net sales37%42% (5pp)37%42% (5pp)Operating earnings before other expenses, net6095776%6095776% as % of net sales10%10%0pp10%10%0ppControlling Interest Net Income (Loss)17273137%17273137%Operating EBITDA1,0741,0007%1,0741,0007% as % of net sales17%17%0pp17%17%0ppFree cash flow after maintenance capital expenditures826836 (1%)826836 (1%)Free cash flow7617216%7617216%Net debt115,14613,47612%15,14613,47612%Total debt119,03115,32724%19,03115,32724%Earnings per share20.030.01137%0.030.01137%January—MarchFirst Quarter

2019 First Quarter Results Page 3 Operating Results Our domestic cement volumes decreased by 1% year-over-year during the quarter as sales volumes were still recovering at the start of the year from the impact of the September 2018 landslide in Naga City, Cebu, near our APO plant. Sales volumes, however, increased throughout the quarter, reaching an all-time high in monthly sales volume during March. Industry growth was driven by a strong residential sector and sustained public infrastructure spending. Our domestic cement prices were 4% higher sequentially during the quarter, reflecting a consolidation of price adjustments implemented in December 2018 due to the impact of the landslide. Product mix effect also positively affected weighted-average prices, as well as a low base of comparison from the first two months of 4Q18. Our domestic cement prices were 7% higher year-over-year, a result of price adjustments implemented during 2018. Domestic Gray CementJanuary—MarchFirst QuarterFirst Quarter 20192019 vs. 20182019 vs. 2018vs. Fourth Quarter 2018Volume (1%) (1%)9%Price in PHP7%7%4%

2019 First Quarter Results Page 4 Operating EBITDA, Free Cash Flow and Debt Information Operating EBITDA and Free Cash Flow In millions of Philippine Pesos Debt Information In millions of Philippine Pesos, except percentages 1 U.S. dollar debt converted using end-of-period exchange rate. See Exchange Rates on page 8 for more detail. 2019 2018 % var 2019 2018 % var Operating earnings before other expenses, net 609 577 6% 609 577 6% + Depreciation and operating amortization 465 423 465 423 Operating EBITDA 1,074 1,000 7% 1,074 1,000 7%—Net financial expenses 334 228 334 228—Maintenance capital expenditures 90 80 90 80—Change in working capital (263) (245) (263) (245)—Income taxes paid 92 104 92 104—Other cash items (net) (6) (2) (6) (2) Free cash flow after maintenance capital expenditures 826 836 (1%) 826 836 (1%)—Strategic capital expenditures 65 114 65 114 Free cash flow 761 721 6% 761 721 6% January—March First Quarter 2019 2018 % var 2018 2019 2018 Total debt1 19,031 15,327 24% 17,377 Currency denomination Short term 6% 3% 7% U.S. dollar 25% 2% Long term 94% 97% 93% Philippine peso 75% 98% Cash and cash equivalents 3,885 1,851 110% 1,814 Interest rate Net debt 15,146 13,476 12% 15,563 Fixed 35% 43% Variable 65% 57% Fourth Quarter First Quarter First Quarter

2019 First Quarter Results Page 5 Financial Results Income Statement & Balance Sheet Information CEMEX Holdings Philippines, Inc. (Thousands of Philippine Pesos in nominal terms, except per share amounts) INCOME STATEMENT 2019 2018 % var 2019 2018 % var Net sales 6,237,427 5,891,259 6% 6,237,427 5,891,259 6% Cost of sales (3,940,101) (3,441,491) (14%) (3,940,101) (3,441,491) (14%) Gross profit 2,297,326 2,449,768 (6%) 2,297,326 2,449,768 (6%) Selling and Administrative expenses (735,596) (744,981) 1% (735,596) (744,981) 1% Distribution expenses (952,950) (1,128,106) 16% (952,950) (1,128,106) 16% Operating earnings before other expenses, net 608,780 576,681 6% 608,780 576,681 6% Other income (expenses), net 6,391 2,276 181% 6,391 2,276 181% Operating earnings (loss) 615,171 578,957 6% 615,171 578,957 6% Financial expenses, net (334,245) (227,656) (47%) (334,245) (227,656) (47%) Foreign exchange gain (loss), net (17,276) (287,440) 94% (17,276) (287,440) 94% Net income (loss) before income taxes 263,650 63,861 313% 263,650 63,861 313% Income tax benefit (expenses) (91,416) 8,704 N/A (91,416) 8,704 N/A Consolidated net income (loss) 172,234 72,565 137% 172,234 72,565 137% Non-controlling interest net income (loss) 7 10 (30%) 7 10 (30%) Controlling Interest net income (loss) 172,241 72,575 137% 172,241 72,575 137% Operating EBITDA 1,074,185 999,652 7% 1,074,185 999,652 7% Earnings per share 0.03 0.01 137% 0.03 0.01 137% January—March First Quarter as of December 31 BALANCE SHEET 2019 2018 % Var 2018 % Var Total Assets 58,774,813 54,205,810 8% 56,938,048 3% Cash and Temporary Investments 3,885,268 1,850,878 110% 1,813,665 114% Derivative Asset 17,020 0 12,875 32% Trade Accounts Receivables 1,082,287 986,253 10% 708,906 53% Other Receivables 90,122 357,001 (75%) 103,396 (13%) Insurance Claims and Premium Receivables 638,466 0 949,983 (33%) Inventories 3,447,227 2,692,510 28% 3,488,178 (1%) Assets Held for Sale 0 111,348 0 Other Current Assets 1,551,920 1,606,962 (3%) 1,677,671 (7%) Current Assets 10,712,310 7,604,952 41% 8,754,674 22% Fixed Assets 16,370,518 16,810,467 (3%) 16,659,868 (2%) Investments in an Associate and Other Investments 14,097 15,407 (9%) 14,097 0% Other Assets and Noncurrent Accounts Receivables 974,819 724,870 34% 818,247 19% Advances to Contractors 2,069,601 0 2,069,601 0% Deferred Income Taxes—net 773,774 1,190,420 (35%) 761,867 2% Goodwill 27,859,694 27,859,694 0% 27,859,694 0% Other Assets 31,691,985 29,790,391 6% 31,523,506 1% Total Liabilities 29,822,627 24,581,020 21% 28,168,255 6% Current Liabilities 10,205,938 7,750,461 32% 10,097,855 1% Long-Term Liabilities 17,657,643 14,681,204 20% 16,009,642 10% Deferred Tax Liability 136,383 56,279 142% 153,602 (11%) Other Liabilities 1,822,663 2,093,076 (13%) 1,907,156 (4%) Consolidated Stockholders’ Equity 28,952,186 29,624,790 (2%) 28,769,793 1% Non-controlling Interest 186 212 (12%) 193 (4%) Stockholders’ Equity Attributable to Controlling Interest 28,952,000 29,624,578 (2%) 28,769,600 1% as of March 31

2019 First Quarter Results Page 6 Financial Results Income Statement & Balance Sheet Information CEMEX Holdings Philippines, Inc. (Thousands of U.S. Dollars, except per share amounts) INCOME STATEMENT 2019 2018 % var 2019 2018 % var Net sales 119,705 113,618 5% 119,705 113,618 5% Cost of sales (75,616) (66,372) (14%) (75,616) (66,372) (14%) Gross profit 44,089 47,246 (7%) 44,089 47,246 (7%) Selling and Administrative expenses (14,117) (14,369) 2% (14,117) (14,369) 2% Distribution expenses (18,288) (21,756) 16% (18,288) (21,756) 16% Operating earnings before other expenses, net 11,684 11,121 5% 11,684 11,121 5% Other income (expenses), net 123 44 180% 123 44 180% Operating earnings (loss) 11,807 11,165 6% 11,807 11,165 6% Financial expenses, net (6,415) (4,391) (46%) (6,415) (4,391) (46%) Foreign exchange gain (loss), net (332) (5,544) 94% (332) (5,544) 94% Net income (loss) before income taxes 5,060 1,230 311% 5,060 1,230 311% Income tax benefit (expenses) (1,754) 168 N/A (1,754) 168 N/A Consolidated net income (loss) 3,306 1,398 136% 3,306 1,398 136% Non-controlling interest net income (loss) 0 0 0 0 Controlling Interest net income (loss) 3,306 1,398 136% 3,306 1,398 136% Operating EBITDA 20,615 19,279 7% 20,615 19,279 7% January—March First Quarter as of December 31 BALANCE SHEET 2019 2018 % Var 2018 % Var Total Assets 1,119,520 1,039,222 8% 1,082,884 3% Cash and Temporary Investments 74,005 35,485 109% 34,493 115% Derivative Asset 324 0 245 32% Trade Accounts Receivables 20,615 18,908 9% 13,482 53% Other Receivables 1,717 6,844 (75%) 1,966 (13%) Insurance Claims and Premium Receivables 12,161 0 18,067 (33%) Inventories 65,661 51,620 27% 66,340 (1%) Assets Held for Sale 0 2,135 0 Other Current Assets 29,560 30,808 (4%) 31,907 (7%) Current Assets 204,044 145,800 40% 166,502 23% Fixed Assets 311,819 322,287 (3%) 316,848 (2%) Investments in an Associate and Other Investments 269 295 (9%) 268 0% Other Assets and Noncurrent Accounts Receivables 18,568 13,897 34% 15,562 19% Advances to Contractors 39,421 0 39,361 0% Deferred Income Taxes—net 14,739 22,822 (35%) 14,490 2% Goodwill 530,661 534,120 (1%) 529,853 0% Other Assets 603,657 571,135 6% 599,534 1% Total Liabilities 568,050 471,262 21% 535,722 6% Current Liabilities 194,399 148,590 31% 192,047 1% Long-Term Liabilities 336,336 281,465 19% 304,482 10% Deferred Tax Liability 2,598 1,079 141% 2,921 (11%) Other Liabilities 34,717 40,128 (13%) 36,272 (4%) Consolidated Stockholders’ Equity 551,470 567,960 (3%) 547,162 1% Non-controlling Interest 4 4 (13%) 4 (3%) Stockholders’ Equity Attributable to Controlling Interest 551,467 567,956 (3%) 547,159 1% as of March 31

2019 First Quarter Results Page 7 Other Information Newly issued PFRS effective in 2019 PFRS 16, Leases (“PFRS 16”) In summary, beginning January 1, 2019, PFRS 16 introduces a single lessee accounting model and requires a lessee to recognize, for all leases, allowing exemptions in case of leases with a term of less than 12 months or when the underlying asset is of low value, assets for the right-of-use of the underlying asset against a corresponding financial liability, representing the net present value of estimated lease payments under the contract, with a single income statement model in which a lessee recognizes amortization of the right-of-use asset and interest on the lease liability. After concluding the inventory and measurement of its leases, CEMEX Holdings Philippines, Inc. and Subsidiaries adopted PFRS 16 using the full retrospective approach by means of which it determined an opening cumulative effect in its statement of financial position as of January 1, 2018 as follows: (Thousands of Philippine Pesos) As of January 1, 2018 Assets for the right-of-use 1,035,445 Deferred tax assets – net 32,756 Lease liabilities 1,144,631 Retained earnings 1 (76,430) 1 The initial effect in retained earnings refers to a temporary difference between the straight-line amortization expense of the right-of-use asset and the amortization of the financial liability under the effective interest rate method since origination of the contracts. This difference will reverse over the remaining term of the contracts. CEMEX Holdings Philippines, Inc. and Subsidiaries modified the previously reported income statement for the three-month period ended March 31, 2018 to give effect to the retrospective adoption of PFRS 16, as follows: SELECTED INFORMATION INCOME STATEMENT As originally reported As modified (Thousands of Philippine Pesos) Jan-Mar First Quarter Jan-Mar First Quarter Revenues 5,891,259 5,891,259 5,891,259 5,891,259 Cost of sales (3,445,425) (3,445,425) (3,441,490) (3,441,490) Operating expenses (1,889,136) (1,889,136) (1,873,087) (1,873,087) Other expenses, net 2,276 2,276 2,276 2,276 Financial (income) expense and others, net (455,528) (455,528) (515,096) (515,096) Earnings before income tax 103,446 103,446 63,862 63,862 Income tax (3,164) (3,164) 8,704 8,704 Earnings from continuing operations 100,282 100,282 72,566 72,566 As of March 31, 2019 and December 31, 2018, assets for the right-of-use amounted to PHP 937.2 million and PHP 1,042.5 million, respectively. In addition, financial liabilities related to lease contracts amounted to PHP 1,080.6 million as of March 31, 2019 and PHP 1,188.8 million as of December 31, 2018 and were included within “Debt and other financial liabilities.”

2019 First Quarter Results Page 8 Definitions of Terms and Disclosures Methodology for translation, consolidation, and presentation of results CEMEX Holdings Philippines, Inc. (“CHP”) reports its consolidated financial statements under Philippine Financial Reporting Standards (“PFRS”). When reference is made in 2019 and 2018 to consolidated financial statements, it means CHP financial information together with its subsidiaries. For the purpose of presenting figures in U.S. dollars, the consolidated balance sheet as of March 31, 2019 has been converted at the end of period exchange rate of 52.50 Philippine pesos per US dollar while the consolidated income statement for the three-month period ended March 31, 2019 has been converted at the January to March 2019 average exchange rate of 52.11 Philippine pesos per US dollar. Definition of terms PHP refers to Philippine Pesos. pp equals percentage points. Prices all references to pricing initiatives, price increases or decreases, refer to our prices for our products. Operating EBITDA equals operating earnings before other expenses, net, plus depreciation and operating amortization. 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 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. Amounts provided in units of local currency per US dollar Exchange Rates2019 average2018 average2019 average2018 average2019 End of period2018 End of period Philippine peso52.1151.8552.1151.8552.5052.16January – March January – March First Quarter