23 October 2015
Cemex reports 5% net sales growth in the third quarter of 2015 23 October 2015
Mexico: Cemex's consolidated net sales reached US$3.7bn in the third quarter of 2015, an increase of 5% on a like-for-like basis for the ongoing operations and adjusting for currency fluctuations, versus the comparable period in 2014. The increase was due to higher prices in local currency terms in most operations, as well as improved volumes in the US and Asia.
Its operating earnings before interest, taxes, depreciation and amortisation (EBITDA) during the quarter reached US$677m, an increase of 5% on a like-for-like basis versus the same period in 2014. The increase was mainly due to higher contributions from Mexico, the US, as well as from the Northern Europe and Asia regions. Operating earnings before other expenses, net, in the third quarter, decreased by 8% to US$439m. Controlling interest net loss narrowed to US$44m from a loss of US$106m in the same period of 2014.
"Our results reflect the unprecedented strength of the US Dollar versus the currencies in most of our markets, which intensified during the quarter. Despite this, we had favourable operating results. Our quarterly sales and operating EBITDA increased by 5% on a like-for-like basis. While EBITDA margin was relatively flat during the quarter, year-to-date EBITDA margin was the highest since 2009. Our free cash flow after maintenance capital expenditure also increased by 25% during the quarter," said Fernando A Gonzalez, Chief Executive Officer. "We are pleased with the results so far of our 'Value-Before-Volume' strategy. Our year-to-date increase in consolidated prices, adjusted for the impact of our variable costs and freight rate increases, has offset slightly more than half of the effect of foreign-exchange fluctuations."
Namibia/China: China's Asian and African Business Management has teamed up with a Namibia's Whale Rock Cement to set up a US$350m cement plant. The project will see the creation of 400 jobs.
A few years ago, Whale Rock Cement came onto the Namibian market with its Cheetah Cement brand. This triggered a fierce competition with the existing cement suppliers, leading to a price war that drove Whale Rock off the market.
The plant, about 245km from the capital Windhoek, will be the second cement plant in Namibia after Ohorongo Cement, which produces 500,000t/yr. Whale Rock Cement Public Relations Officer Manfred Uxamb said that a comprehensive feasibility study has been completed and that a limestone survey has also been carried out. "Together with our partners, we have performed a comprehensive investigation of the land plot, limestone, clay, waste iron oreand gypsum," said Uxamb, adding that they had found that all these resources meet requirements. "The survey also included market research that proved that the project is feasible. The feasibility study was presented to the Government of the Republic of Namibia and approved." According to Uxamb, the area chosen for the plant has enough limestone deposits to last more than 40 years.
HeidelbergCement reduces refinancing needs by further Euro500m 23 October 2015
Germany: HeidelbergCement has taken another step to optimise the financing of the Italcementi acquisition. The volume of the bridge financing could be reduced by a further Euro500m from Euro3.8bn to Euro3.3bn. The refinancing needs in the bond market declined by Euro500m to around Euro2.5bn, correspondingly.
Decisive for the reduction of the financing volume was that some of Italcementi's creditor banks have agreed to waive their change of control clauses. As a consequence, HeidelbergCement will have access to additional credit lines totalling Euro500m on a long-term basis also after the takeover. Therefore, refinancing of these credit lines after the acquisition is no longer necessary and the volume of the bridge financing could be reduced accordingly. As already communicated in the announcement of the Italcementi acquisition, the bridge financing should be refinanced by free cash flow, the sale of production sites and the issuance of bonds. The reduction in the volume of bridge financing thus also reduces the need for refinancing in the bond market by the same amount.