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Pensions and Post-Employment Benefits

12 Months Ended

Dec. 31, 2024

Pensions and other post-employment benefits

19)	PENSIONS AND POST-EMPLOYMENT BENEFITS

Defined contribution pension plans

The

consolidated costs of defined contribution plans for the years ended December 31, 2024, 2023 and 2022 were $74, $64 and $59, respectively. Cemex contributes periodically the amounts offered by the pension plan to the employee’s individual accounts, not retaining any remaining liability as of the financial statements’ date.

Defined benefit pension plans

Most

of Cemex’s defined benefit plans have been closed to new participants for several years. Actuarial results related to pension and other post-employment benefits are recognized in earnings and/or in “Other comprehensive income” for the period in which they are generated, as appropriate. For the years ended December 31, 2024, 2023 and 2022, the effects of pension plans and other post-employment benefits are summarized as follows:


		Pensions									Other benefits								Total

Net period cost (income):		2024			2023			2022			2024		2023			2022			2024			2023			2022

Recorded in operating costs and expenses
Service cost	$		7			6			7			4		4			4			11			10			11
Past service cost			—			—			1			—		—			—			—			—			1
Settlements, curtailments and other changes			—			(9	)		2			—		(1	)		—			—			(10	)		2

			7			(3	)		10			4		3			4			11			—			14

Recorded in other financial expenses
Net interest cost			32			36			22			8		8			6			40			44			28

Recorded in other comprehensive income
Actuarial (gains) losses for the period			(75	)		46			(166	)		1		(1	)		(10	)		(74	)		45			(176)

	$		(36	)		79			(134	)		13		10			—			(23	)		89			(134)

As of December 31, 2024 and 2023, the reconciliation of the actuarial benefits’ obligations and pension plan assets, are presented as follows:


			Pensions						Other benefits						Total

		2024			2023			2024			2023			2024			2023

Change in benefits obligation:
Projected benefit obligation at beginning of the period	$		1,909			1,811			101			92			2,010			1,903
Service cost			7			6			4			4			11			10
Interest cost			97			100			8			8			105			108
Actuarial (gains) losses			(159	)		30			1			(1	)		(158	)		29
Reduction from disposal of assets			(17	)		2			—			—			(17	)		2
Settlements and curtailments			—			(2	)		—			—			—			(2)
Plan amendments			—			(10	)		—			(1	)		—			(11)
Benefits paid			(160	)		(122	)		(10	)		(8	)		(170	)		(130)
Foreign currency translation			(65	)		94			(12	)		7			(77	)		101

Projected benefit obligation at end of the period			1,612			1,909			92			101			1,704			2,010

Change in plan assets:
Fair value of plan assets at beginning of the period			1,273			1,207			2			1			1,275			1,208
Return on plan assets			65			64			—			—			65			64
Actuarial losses			(84	)		(16	)		—			—			(84	)		(16)
Employer contributions			85			97			10			8			95			105
Reduction from disposal of assets			(13	)		1			—			—			(13	)		1
Settlements			—			(2	)		—			—			—			(2)
Benefits paid			(160	)		(122	)		(10	)		(8	)		(170	)		(130)
Foreign currency translation			(22	)		44			(1	)		1			(23	)		45

Fair value of plan assets at end of the period			1,144			1,273			1			2			1,145			1,275

Net projected liability in the statement of financial position	$		468			636			91			99			559			735

For the years 2024, 2023 and 2022, actuarial (gains) losses for the period were generated by the following main factors as follows:


		2024			2023			2022
Actuarial (gains) losses due to experience	$		(26	)		13			96
Actuarial (gains) losses due to demographic assumptions			(28	)		(5	)		(2)
Actuarial (gains) losses due to financial assumptions			(20	)		37			(270)

	$		(74	)		45			(176)

In 2024, net actuarial gains due to financial assumptions were driven by a general increase in the discount rates applicable to the calculation of the Projected Benefit Obligation (“PBO”), mainly in the United Kingdom, Mexico and the United States, partially offset by lower returns in plan assets than estimated for a total of $84, of which $66 refers to the United Kingdom, $18 to the United States and $9 to Mexico. In addition, the actuarial gains due to experience for $26 and due to demographic assumptions of $28 were mainly generated in the United Kingdom.

In 2023, net actuarial losses due to financial assumptions were mainly driven by a decrease in the discount rates applicable to the calculation of the PBO in the United Kingdom, the United States, Germany, Colombia and Poland. Moreover, the overall net actual return on plan assets in most countries were less than the expected returns for a total of $16, of which $31 referred to the United Kingdom, partially offset by a higher performance than expected in Mexico of $12 and the United States of $8. In addition, the PBO increased by adjustments due to experience for $13, mainly in the United Kingdom and Germany.

In 2022, net actuarial gains due to financial assumptions were driven by a general increase in the discount rates applicable to the calculation of the PBO in the United Kingdom, the United States, Germany, and Mexico, partially offset by actual returns in plan assets lower than estimated for a total of $466, of which $373 referred to the United Kingdom, $52 to the United States and $

to Mexico. In addition, the PBO increased significantly related to adjustments due to experience for $96, mainly in the United Kingdom for $

and Germany for $13. Adjustments in demographic assumptions of $2 were not significant.

As of December 31, 2024 and 2023, based on the hierarchy of fair values, plan assets are detailed as follows:


		2024									2023
		Level 1		Level 2		Level 3		Total			Level 1		Level 2		Level 3		Total
Cash	$		25		—		—		25	$		24		—		—		24
Investments in corporate bonds			237		46		—		283			11		391		—		402
Investments in government bonds			339		—		—		339			114		209		—		323

Total fixed-income securities			601		46		—		647			149		600		—		749

Investment in marketable securities			127		73		—		200			179		43		—		222
Other investments and private funds			44		32		222		298			70		33		201		304

Total variable-income securities			171		105		222		498			249		76		201		526

Total plan assets	$		772		151		222		1,145	$		398		676		201		1,275

The most significant assumptions used in the determination of the benefit obligation were as follows:


	2024				2023
	Mexico	United States	United Kingdom	Range of rates in other countries	Mexico	United States	United Kingdom	Range of rates in other countries
Discount rates	11.8%	5.7%	5.6%	3.3% – 9.5%	10.5%	5.2%	4.7%	3.1% – 11.0%
Rate of return on plan assets	11.8%	5.7%	5.6%	3.3% – 9.5%	10.5%	5.2%	4.7%	3.1% – 11.0%
Rate of salary increases	4.5%	—	3.2%	2.5% – 7.3%	4.5%	—	3.1%	2.5% – 7.3%

As of December 31, 2024, estimated payments for pensions and other post-employment benefits over the next 10 years were as follows:


		Estimated payments
2025	$		156
2026			135
2027			133
2028			133
2029 – 2034			803

As of December 31, 2024 and 2023, the aggregate PBO for pension plans and other post-employment benefits and the plan assets by country were as follows:


		2024							2023
		PBO		Assets		Deficit			PBO		Assets		Deficit
Mexico	$		200		30		170	$		253		44		209
United States			142		143		(1)			184		188		(4)
United Kingdom			960		752		208			1,129		821		308
Germany			121		5		116			141		6		135
Other countries			281		215		66			303		216		87

	$		1,704		1,145		559	$		2,010		1,275		735

In some countries, Cemex has established health care benefits for retired personnel limited to a certain number of years after retirement. As of December 31, 2024 and 2023, the projected benefits obligation related to these benefits was $51 and $57, respectively, included within other benefits liability. The medical inflation rates used to determine the PBO of these benefits in 2024 and 2023 for Mexico were 8.0% and 8.0%, respectively, for Puerto Rico 7.0% in 2024 and 6.6% in 2023, for the United Kingdom were 6.7% in 2024 and 6.6% in 2023, and for TCL was a range between 5.0% and 8.0% in 2024 and 5.0% and 9.0% in 2023.

Significant settlements or curtailments related to employees’ pension benefits and other post-employment benefits during the reported periods

During 2024, there were no significant settlements or curtailments related to employees’ pension benefits and other post-employment benefits.

In 2023 as a result of an extension in the retirement age for the Company’s operations in Mexico, there was a reduction of $11 in the retirement obligations recognized against the statement of income for the period. Additionally, in France, there was a pension reform that increased the legal minimum retirement age, resulting in a total past service amendment of $1 in its pension plan recognized in the statement of income for the period.

During 2022, there were no significant settlements or curtailments related to employees’ pension benefits and other post-employment benefits.

Sensitivity analysis of pension and other post-employment benefits

As of December 31, 2024, Cemex performed sensitivity analyses on the most significant assumptions that affect the PBO, considering reasonable independent changes of plus or minus 50 basis points in each of these assumptions. The increase (decrease) that would have resulted in the PBO of pensions and other post-employment benefits are shown below:


		Pensions						Other benefits						Total
Assumptions:		+50 bps			-50 bps			+50 bps			-50 bps			+50 bps			-50 bps
Discount Rate Sensitivity	$		(75	)		83			(3	)		3			(78	)		86
Salary Increase Rate Sensitivity			4			(4	)		1			(1	)		5			(5	)
Pension Increase Rate Sensitivity			56			(54	)		—			—			56			(54	)

Multiemployer defined benefit pension plans

In addition to the Company’s sponsored plans, Cemex contributes to union-sponsored multiemployer retirement defined benefit pension plans (the “Multiemployer Plans”) under the terms of collective bargaining agreements for certain union employees in the United States and the United Kingdom. The Company’s main risks of participating in Multiemployer Plans are different from its single-employer plans in the following aspects:

Assets contributed to the Multiemployer Plans by one employer may be used to provide benefits to employees of other participating employers;

If a participating employer stops contributing to the Multiemployer Plans, the unfunded obligations of the Multiemployer Plans may be borne by the remaining participating employers; and

If Cemex chooses to stop participating in the Multiemployer Plans, the Company may be required to pay the Multiemployer Plans an amount based on the underfunded status of the Multiemployer Plans, referred to as a withdrawal liability.

The

Company’s funding arrangements, rate of contributions and funding requirements were made in accordance with the contractual multiemployer agreements. The combined amounts contributed to the Multiemployer Plans were $19 in 2024, $20 in 2023 and $21 in 2022. The Company expects to contribute $20 to the Multiemployer Plans in 2025.

Among

other factors, Multiemployer Plans in the red zone (critical) are generally less than

% funded, Multiemployer Plans in the yellow zone (endangered) are less than

% funded and Multiemployer Plans in the green zone (neither critical and declining, critical, or endangered) are at least

% funded. Over

% of Cemex’s obligations and contributions under the Multiemployer Plans are related to the United States where

461

former employees are beneficiaries and where, according to data obtained from Multiemployer Plans actuary, most of the plans are considered to be in the green zone and one plan is in the yellow zone. As a result, the Company’s risk of increasing contributions is considered l

w. In the United Kingdom, the Multiemployer Plan, which covers only two of Cemex’s former employees, is in the green zone. In both the United States and the United Kingdom, Cemex is a small participant in the applicable Multiemployer Plans.