CEMEX(US:CX)2022-02-10 22:59Financial Data and Key Metrics Changes - The company achieved an 18% growth in EBITDA, the highest in a decade, with full-year EBITDA margins improving by 0.8 percentage points despite inflationary pressures [4][6][8] - Free cash flow generated exceeded $1.1 billion, marking a 15% increase from 2020, driven by strong sales growth of 11% [6][52] - Consolidated net debt decreased by $2.3 billion, with a leverage ratio reaching 2.73x, the lowest in over a decade [54][56] Business Line Data and Key Metrics Changes - Cement volumes grew by 6%, the highest since 2016, with consolidated cement prices rising by 5% for the year [7][11] - Urbanization Solutions saw EBITDA increase by 22%, contributing significantly to overall growth [8] - Ready-mix and aggregates margins remained stable to improving, while cement margins were impacted by rising costs [9][11] Market Data and Key Metrics Changes - In the U.S., sales grew by 9%, with cement, ready-mix, and aggregate volumes increasing by 6%, 8%, and 1% respectively [35] - Mexico experienced a 17% increase in sales, with cement volumes surpassing pre-pandemic levels [39][48] - EMEA region saw a 6% annual growth driven by higher prices and volumes, particularly in the U.K., Poland, France, and Spain [43] Company Strategy and Development Direction - The company plans to invest $600 million in strategic assets in 2022, focusing on developed markets and enhancing growth portfolio [14][15] - A significant emphasis is placed on transitioning to a low-carbon economy, with a commitment to aggressive climate action goals validated by SBTi [16][17] - The company is exploring investment opportunities in emerging markets while increasing the weight of developed markets within its portfolio [15][16] Management's Comments on Operating Environment and Future Outlook - Management anticipates continued cost pressures in 2022, particularly from energy, but expects to recover margins through pricing strategies [12][65] - The outlook for 2022 includes mid-single-digit EBITDA growth driven primarily by pricing, with flat to low single-digit volume increases [65] - The company remains optimistic about residential growth and infrastructure demand, particularly in the U.S. due to the Biden Infrastructure Build [38][39] Other Important Information - The company has committed to a sustainability-linked financing framework, aiming for at least 50% of its debt stack to be sustainability-linked by 2025 [55] - The introduction of alternative fuels constituted 29% of the fuel mix, with significant cost savings achieved compared to fossil fuels [28][30] - The company is implementing a digital transformation initiative called "Working Smarter," expected to capture annual savings of up to $100 million [60][63] Q&A Session Summary Question: Concerns about EBITDA growth guidance - Management acknowledged the volatility in costs and inflation, indicating that the guidance reflects cautious expectations for 2022 [68][70] Question: CO2 reduction targets and potential revisions - Management expressed confidence in achieving CO2 reduction targets but noted that future reductions may not be as significant as the 4.4% achieved in 2021 [75][76] Question: Pricing traction in various markets - Management reported strong traction from January pricing increases, particularly in Mexico, with expectations for further increases in the summer and fall [79][84]