CEMEX Latam Holdings announces 3Q18 results
Published by Lucy Stewardson,
CEMEX Latam Holdings (CLH) has announced that its consolidated net sales reached US$277 million in 3Q18. This is a decline of 8% compared to 3Q17. Operating EBITDA reached US$60 million in 3Q18, which was 17% lower when compared on a like-for-like basis with 3Q17.
The company’s consolidated volumes also decreased. Domestic grey cement volumes lowered by 7%, ready mix by 9%, and aggregates by 8%, compared to the results of 3Q17. Consolidated prices (in US dollars) for domestic grey cement increased by 2%, where ready mix and aggregates decreased by 3% and 2% respectively, when compared like-for-like with 3Q17.
However, the company reports that it is encouraged by its results in Colombia, where it has seen double digit EBITDA growth and a 3.5% margin expansion. It remains too early to confirm an inflection point in the country’s cement demand. Still, the company has stated that it is glad to observe cement demand stabilisation during the quarter on a year-over-year basis, as well as an acceleration on a sequential basis.
In terms of consolidated corporate results, controlling interest net income in 3Q18 was US$20 million, compared to US$28 million in 3Q17. Free cash flow reached US$17 million in 3Q18, which was 3% higher compared to 3Q17 on a like-for-like basis. In addition, CLH received US$31 million in 3Q18, related to the gross proceeds from the sale of its cement distribution business in Manaus, Brazil. The company’s net debt declined US$71 million during the first nine months of the year, to reach US$811 million.
The company has also reported its geographical markets for 3Q18. Operating EBITDA in Colombia reached US$26 million, which was 16% higher than that of 3Q17. Net sales declined 5% to US$134 million.
Operating EBITDA in Panama decreased by 44% to US$16 million and net sales reached US$58 million in 3Q18, which was a decline of 18% compared to 3Q17.
In Costa Rica, operating EBITDA reached US$11 million in 3Q18, which is US$2 million lower when compared to 3Q17. Net sales declined by 11% when compared with 3Q17, reaching US$33 million.
In the rest of CLH, operating EBITDA declined 21% in 3Q18 to US$16 million. Net sales were 2% lower than those of 3Q17, reaching US$56 million.
“Our results during the quarter were mainly affected by a weak demand environment in Panama and Nicaragua,” said Jaime Muguiro, CEO of CLH. “In the case of Panama, industry demand continued decreasing by double digits after the strike on a year-over-year basis, while in Nicaragua demand maintained the low levels observed during the second quarter.
“We are very pleased with our free cash flow generation and with the successful closure of the divestment of our business in Manaus, Brazil. Free cash flow, plus proceeds from this divestment, were mainly used to reduce debt during the quarter. Net debt decreased by US$45 million in this period, reaching US$811 million and the net-debt-to-EBITDA ratio dropped 3.1 times, despite the lower EBITDA.”
CEMEX Latam Holdings is a regional leader in the building solutions industry, providing high-quality products and reliable service to customers and communities in Colombia, Panama, Costa Rica, Nicaragua, El Salvador, Guatemala, and Brazil.
Read the article online at: https://www.worldcement.com/the-americas/29102018/cemex-latam-holdings-announces-3q18-results/
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