• Urbanization Solutions is one of our four core businesses. It is a business that complements our value offering of products and solutions, looking to connect with the broader metropolis ecosystem, address urbanization challenges, and provide means to all stakeholders in the construction value chain to enable sustainable urbanization by focusing on four market segments: performance materials, circularity, industrialized construction, and related services. • White cement is a specialty portland cement used ...

CEMEX, S.A.B. de C.V. (NYSE:CX) Q1 2024 Earnings Conference Call April 25, 2024 11:00 AM ET Company Participants Lucy Rodriguez - Chief Communications Officer Fernando Gonzalez - Chief Executive Officer Maher Al-Haffar - Chief Financial Officer Conference Call Participants Alejandra Obregon - Morgan Stanley Pablo Ricalde - Santander Adrian Huerta - JPMorgan Alberto Valerio - UBS Yassine Touahri - On Field Research Anne Milne - Bank of America Gordon Lee - BTG Operator Good morning. Welcome to the CEMEX Firs ...

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MONTERREY, Mexico--(BUSINESS WIRE)--Rating agency Standard & Poor’s (S&P) announced today that it has upgraded Cemex’s long-term global scale issuer credit rating to Investment Grade (BBB-) due to its strong financial and operating performance, deleveraging strategy, and flexible capital allocation. “Achieving an investment-grade credit rating from S&P is a very important milestone for Cemex,” said Fernando A. González, CEO of Cemex. “While we had record results last year, this rating is recognition of s ...

Share Structure and Financial Position - As of December 31, 2023, Cemex had 13,068,000,000 fixed shares and 31,779,148,989 variable shares, compared to 32,441,076,423 variable shares in 2022[1]. - As of December 31, 2023, the Group's goodwill balance was $7,674 million, representing 27% of total consolidated assets, with $6,176 million related to Cash-Generating Units in the United States[71]. - Total assets increased to $28,433 million as of December 31, 2023, up from $26,447 million in 2022, representing a growth of 7.5%[116]. - Total liabilities increased to $16,317 million, up from $15,538 million, reflecting a rise of 5.0%[116]. - Stockholders' equity reached $12,116 million, an increase from $10,909 million, indicating a growth of 11.1%[116]. Financial Performance - Consolidated net income for 2023 was $199 million, a decrease of 77.5% from $885 million in 2022[106]. - Revenues increased to $17,388 million in 2023, up 11.0% from $15,577 million in 2022[113]. - Gross profit rose to $5,861 million, reflecting a 21.6% increase compared to $4,822 million in 2022[113]. - Operating earnings before other expenses reached $2,114 million, a 35.4% increase from $1,561 million in 2022[113]. - Basic earnings per share from continuing operations was $0.0042, compared to $0.0123 in 2022, indicating a decline[113]. Cash Flow and Investments - Cash flows provided by operating activities from continuing operations increased to $3,278 million in 2023, compared to $2,150 million in 2022, representing a growth of 52%[141]. - The company experienced a net cash flow used in investing activities of $1,340 million in 2023, compared to $732 million in 2022[141]. - Proceeds from new debt instruments amounted to $2,938 million in 2023, an increase from $2,006 million in 2022[141]. - Capital expenditures for 2023 were $16,904 million, with significant investments in property, machinery, and equipment[174]. Legal and Regulatory Matters - The company is currently involved in various legal proceedings, including antitrust investigations in the US and an inquiry by the European Commission in France, but the outcomes are uncertain[24]. - Cemex's operations in the US received a grand jury subpoena from the DOJ regarding possible antitrust law violations, with the investigation still in early stages[24]. - The company has recognized adequate provisions for various legal claims arising in the ordinary course of business, believing they will not significantly affect its financial position[27]. - The company has a legal claim from SCI in France regarding a breach of contract, with potential damages quantified at $61 million, although Cemex believes this will not materially impact its financial condition[22]. Environmental and Sustainability Commitments - Cemex committed to supply 1.2 million tons of petroleum coke per year to TEG and another third-party electrical energy generating plant until 2027[19]. - The company has detailed yearly CO2 roadmaps for each cement plant, focusing on alternative fuels and lower carbon raw materials[21]. - Management estimates that excess allowances for CO2 costs will allow the Company to offset these costs in EU and UK operations until 2026, with potential for extension beyond 2026 through the use of lower carbon materials[65]. Segment Performance - External revenues from the United States segment were $5,338 million, contributing to an operating EBITDA of $1,040 million[170]. - The Mexico segment reported external revenues of $4,855 million, with an operating EBITDA of $1,488 million[170]. - The Dominican Republic segment achieved external revenues of $360 million, with an operating EBITDA of $139 million[170]. - The reportable segments collectively generated $16,904 million in revenues, with a total operating EBITDA of $3,629 million[170]. Shareholder and Executive Compensation - Cemex's total compensation for its Board of Directors and senior management was $71 million in 2023, which includes $24 million in base compensation and performance bonuses[31]. - The total cash payout of the annual executive variable compensation may vary by -10% to +10% based on Cemex's 2030 CO2 reduction targets[21]. Taxation and Financial Reporting - The effective income tax rates for 2023 are 30.0% in Mexico, 21.0% in the United States, and 23.5% in the United Kingdom[47]. - The Group's evaluation of a tax proceeding in Spain is a key audit matter, requiring significant judgment regarding uncertain tax treatments[82]. - The Group's external tax advisers assessed the estimates of tax liabilities, reflecting the underlying facts and circumstances of the tax proceeding[56]. - The Group's consolidated financial statements are prepared in accordance with IFRS Accounting Standards, ensuring fair presentation of financial position and performance[80].

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Investors looking for stocks in the Building Products - Concrete and Aggregates sector might want to consider either Cemex (CX) or Martin Marietta (MLM) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors sto ...

Financial Data and Key Metrics Changes - Full year net sales increased by 8%, while EBITDA grew by 20%, reaching a record $3.35 billion, with EBITDA margin expanding by 2 percentage points [4][15] - Free cash flow after maintenance CapEx was $1.2 billion, growing by $655 million due to higher EBITDA and improved working capital management [8][48] - The leverage ratio declined by 0.8x to 2.06x, within investment-grade credit parameters, with a return on capital expanding by 1.5 percentage points to close to 14% [8][51] Business Line Data and Key Metrics Changes - Growth investments accounted for 10% of total EBITDA and 13% of incremental EBITDA, with Urbanization Solutions growing at a CAGR of 24% since 2019 [5][21] - In Mexico, both sales and EBITDA grew in the mid-teen percentage area, driven by strong formal sector demand [28] - The U.S. posted record full year EBITDA of over $1 billion, with a 37% increase despite lower volumes, driven by pricing strategy and growth investments [32] Market Data and Key Metrics Changes - Volume declines were noted in several markets, particularly in the U.S. due to weather and lower demand, while Mexico reported positive volumes [9][32] - EMEA experienced a 7% increase in full year EBITDA, with a 0.3 percentage point expansion in EBITDA margin despite a slowdown in construction activity [36] - South Central America and the Caribbean saw a rebound in sales and EBITDA, with cement prices increasing by 9% [40][42] Company Strategy and Development Direction - The company aims to focus on deleveraging and accelerating its bolt-on growth strategy while proposing a sustainable shareholder return program [3][24] - The Urbanization Solutions business is aligned with global construction trends, including decarbonization and circularity, presenting significant growth prospects [12][21] - The company plans to initiate a sustainable dividend program, proposing a 2024 dividend of $120 million, reflecting confidence in operating performance and free cash flow generation [25][26] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2024, particularly in Mexico and the U.S., expecting EBITDA growth between low to mid-single digits [54] - The company anticipates continued deceleration in cost inflation and aims to maintain and increase margins [54][56] - Management highlighted the importance of monitoring election dynamics in both Mexico and the U.S. as potential influences on demand [62][66] Other Important Information - The company achieved a 4% decline in Scope 1 emissions in 2023, reflecting progress in its decarbonization efforts [10][16] - The company was recognized by CDP on its A List for climate change disclosure, indicating strong transparency in environmental impact [4][11] Q&A Session All Questions and Answers Question: Outlook for volume expectations in Mexico and the U.S. - Management noted that while there are risks, strong demand from nearshoring and ongoing projects in Mexico support a positive outlook for volumes [62][64] Question: Pricing strategy for 2024 - The company plans to adjust pricing strategies based on inflation recovery, with potential for multiple price increases if necessary [76][78] Question: Strategic CapEx allocation and timing - Management confirmed that strategic CapEx is well-defined and projects are expected to be executed evenly throughout the year, focusing on climate action and aggregate replenishment [82][86] Question: Dividend policy evolution - The company aims to allocate about 10% of operating free cash flow to dividends, with expectations for growth as business performance improves [97][98] Question: Urbanization Solutions business and geographic breakdown - Management confirmed that the Urbanization Solutions business is significant, with expectations for more disclosure as it grows [116]

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