CEMEX reports 1996 second quarter results
July 26, 1996
Sales increased by 15%, Operating Income by 16% and Cash From Operations by 17% in Dollar Terms During the Second Quarter of 1996.
CEMEX, S.A. de C.V. (OTC: CMXBY) today reported that second quarter net sales increased 5% in real terms, to Ps. 5.854 billion, over second quarter 1995. For the quarter, revenues from Mexico represented 41% of the total, Spain 24%, the United States 13%, Venezuela 11%, Panama and the Caribbean 7% and Colombia (Diamante) 4%.
Cash flow (EBITD) increased 7% in real terms, to Ps. 1.945 billion (US$257 million), and CEMEX´ net cash position was Ps. 2.808 billion (US$370 million) at the end of the quarter.
Net income decreased 62% during the second quarter, to Ps. 2.208 billion, or Ps. 2.73 (US$0.36) per ADR (ratio 2:1), based on an average of 1,228,408,233 shares outstanding during the period. This decline was due in part to significant non-cash gains in 1995.
Operating margin increased to 24.6%, from 24.2% in 1995, because of a slight improvement in SG&A. This resulted in operating income of Ps. 1.438 billion, 6% higher than second quarter 1995.
Leverage (total debt / total capitalization) ended the quarter at 51.9%. This ratio increased from the first quarter of 1996 because the Company retired one of its off-balance sheet equity swaps (Citibank, US$150 million) using on-balance-sheet debt.
During the first quarter, the peso depreciated 6.5% (in peso terms) with respect to the dollar, as measured by the interbank exchange rate. Exchange rates used by the Company at June 30, 1995 and June 28, 1996 were Ps. 6.2783 and Ps. 7.580 per dollar, respectively.
Gustavo Caballero, CEMEX´ Chief Financial Officer, said, "CEMEX had a very active quarter. We entered the Colombian cement market and significantly advanced our financial plan. Through three recent initiatives, including the successful US$541 million buy-back of CEMEX "Jumbo" 8 7/8 Eurobonds due 1998, the key components of our 1996 refinancing strategy are now in place."
"CEMEX international assets continue to play an integral role in our business and financial strategy. They not only provide a hedge against regional currency fluctuations, but also increase our financial flexibility by diversifying the Company´s assets and lengthening its average debt maturity," added Mr. Caballero.
Founded in 1906, CEMEX is the largest cement producer in the Americas and one of the three largest cement producers in the world, with close to 50 million metric tons of annual production capacity. CEMEX has market-leading operations in Mexico, Spain, Venezuela, Panama and the Dominican Republic and a significant presence in Colombia, the Caribbean and the southwest United States. Over fifty-five percent of the Company´s assets are located outside Mexico.