First Quarter Net Sales Up 11% at CEMEX

CEMEX's (NYSE: CX) consolidated net sales increased 11% in the first quarter of 2011 to US$3.4 billion versus the comparable period in 2010. Operating EBITDA increased 1% in the first quarter of 2011 to US$519 million versus the same period of 2010. 

The increase in consolidated net sales was due to higher volumes mainly from Mexican, European, and South/Central America and Caribbean operations. Infrastructure and residential sectors were the main drivers of demand in most markets. 

  • Free cash flow after maintenance capital expenditures for the quarter was negative US$317 million, from a negative US$171 million in the same quarter of 2010. 
  • Operating income in the first quarter increased 16%, to US$172 million, from the comparable period in 2010.

"Despite the still lingering effects of the economic downturn in a number of our key geographies, we are encouraged by the stabilization of important indicators in the construction materials business," said Fernando A. González, executive vice president of finance and administration. "Consolidated domestic gray cement and aggregates volumes showed growth for the first time since the first quarter of 2007. We are pleased with the trend we have seen in our quarterly sales because this is the seventh consecutive quarter of top-line recovery in our results. And, as a result of our financial strategy, we have eliminated our refinancing risk until December of 2013."

During the quarter, controlling interest net income was a loss of US$276 million, versus a loss of US$342 million in the same period last year. This reflects higher operating income, higher exchange gain, and lower other expenses, which more than offset the higher financial expenses during the quarter.

Geographical Highlights

Net sales in operations in Mexico increased 14% in the first quarter of 2011 to US$842 million, compared with US$742 million in the first quarter of 2010. Operating EBITDA increased 13% to US$292 million versus the same period of last year.

CEMEX's operations in the United States reported net sales of US$507 million in the first quarter of 2011, down 8% from the same period in 2010. Operating EBITDA was a loss of US$48 million in the quarter.

In Europe, net sales for the quarter increased 24% to US$1.2 billion, compared with US$947 million in the first quarter of 2010. Operating EBITDA was US$50 million for the quarter.

CEMEX's operations in South/Central America and the Caribbean reported net sales of US$396 million during the first quarter of 2011, representing an increase of 8% over the same period of 2010. Operating EBITDA decreased 8% to US$117 million in the first quarter of 2011, from US$126 million in the first quarter of 2010.

First-quarter net sales in Africa and the Middle East were US$248 million, down 6% from the same quarter of 2010. Operating EBITDA decreased 4% to US$80 million for the quarter versus the comparable period in 2010.

Operations in Asia reported a 2% decrease in net sales for the quarter, to US$122 million, versus the first quarter of 2010, and Operating EBITDA for the quarter was US$21 million, down 36% from the same period in the previous year.

CEMEX is a global building materials company working in more than 50 countries.

(CEMEX Q1 2011 Financial Report)

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