Cemex announces overall growth
Published by Rebecca Bowden,
Cemex has released its 4Q16 and FY16 results, indicating a consolidated net sales increase of 4% during 4Q16, as well as FY16.
The increase in quarterly consolidated net sales on a like-to-like basis was due to higher prices of products, in local currency terms, in most of Cemex's operations, as well as higher volumes in Mexico, the United Kingdom and Germany.
Operating earnings before other expenses, net, in 4Q16 increased by 12%, to US$453 million and increased 14%, to US$1.9 billion, for FY16.
Controlling interest net income during 4Q16 was almost 50% higher, reaching US$214 million from an income of US$144 million in the same period last year. Also, controlling interest net income for the full year improved to US$750 million from an income of US$75 million in 2015.
Operating EBITDA on a like-to-like basis increased by 10% and 15% during the quarter and the full year, respectively, to US$654 million and US$2.7 billion versus the comparable periods of 2015.
Operating EBITDA margin during 4Q16 grew by 1.0 percentage points on a year-over-year basis reaching 20.5%. For the full year, operating EBITDA margin increased to 20.5%, up 1.7 percentage points from 2015.
Free cash flow after maintenance capital expenditures for 4Q16 increased by 9% to US$617 million, compared to 4Q15. For FY16, free cash flow after maintenance capital expenditures reached US$1.7 billion, an increase of 91% versus previous year.
Asset sales reached approximately US$2 billion, of which slightly above US$1 billion closed during 2016. These assets are being sold at double-digit multiples on average.
Fernando A. Gonzalez, Chief Executive Officer, said: “2016 was a very good year for Cemex. Despite continued volatility and uncertainty in the markets, we were able to deliver strong underlying operational and financial results by remaining focused on the variables that we control. As a result of our favourable volume and price performance, sales increased by 4% in 2016, while operating EBITDA grew by 15%, on a like-to-like basis. Our free cash flow after maintenance capex was close to US$1.7 billion, almost double last year's level. This was driven by higher EBITDA generation as well as our initiatives to reduce interest expense, maintenance CAPEX and working capital investment. In line with our stated objective to reach an investment grade capital structure as soon as possible, we applied the proceeds from our free cash flow generation and asset sales mainly for debt reduction. Our total debt is close to US$2.3 billion lower than that at the end of 2015. This represents a 15% reduction from the debt level as of the end of 2015 and a 25% reduction since the end of 2013. We are also pleased that S&P Global Ratings recognised our discipline and consistency in reducing our leverage with in an improvement in our credit rating, which should further enhance our financial flexibility and reduce our cost of capital.”
Net sales in Cemex's operations in Mexico increased 25% on a like-to-like basis in 4Q16 to US$701 million, compared with US$672 million in 4Q15. Operating EBITDA increased by 28% on a like-to-like basis to US$245 million versus the same period of last year.
Cemex's operations in the United States reported net sales of US$880 million in 4Q16, flat on a like-to-like basis from the same period in 2015. Operating EBITDA increased by 16% on a like-to-like basis to US$183 million in 4Q16, versus a gain of US$162 million in 4Q15.
Cemex's operations in South, Central America and the Caribbean reported net sales of US$403 million during 4Q16, representing a decrease of 6% on a like-to-like basis over the same period of 2015. Operating EBITDA decreased 12% on a like-to-like basis to US$108 million in 4Q16, from US$125 million in 4Q15.
In Europe, net sales for the fourth quarter of 2016 decreased 2% on a like-to-like basis to US$759 million, compared with US$834 million in 4Q15. Operating EBITDA was US$76 million for the quarter, 3% lower on a like-to-like basis than the same period last year.
Operations in Africa, Middle East and Asia reported a 9%
decrease in net sales on a like-to-like basis for 4Q16, to US$328 million, versus 4Q15. Operating EBITDA for the quarter was US$76 million, up 5% on a like-to-like basis from the same period last year.
Read the article online at: https://www.worldcement.com/the-americas/10022017/cemex-announces-overall-growth/
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