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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 or 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of October, 2013
Commission File Number: 001-14946
CEMEX, S.A.B. de C.V.
(Translation of Registrant’s name into English)
Avenida Ricardo Margáin Zozaya #325, Colonia Valle del Campestre
Garza García, Nuevo León, México 66265
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F X Form 40-F
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
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Contents
| 1. | Press release, dated October 24, 2013, announcing third quarter 2013 results for CEMEX, S.A.B. de C.V. (NYSE:CX). |
| 2. | Third quarter 2013 results for CEMEX, S.A.B. de C.V. (NYSE:CX). |
| 3. | Presentation regarding third quarter 2013 results for CEMEX, S.A.B. de C.V. (NYSE:CX). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, CEMEX, S.A.B. de C.V. has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| CEMEX, S.A.B. de C.V. | ||
| (Registrant) | ||
| Date: October 24, 2013 | By: /s/ Rafael Garza | |
| Name: Rafael Garza | ||
| Title: Chief Comptroller | ||
EXHIBIT INDEX
| EXHIBIT NO. | DESCRIPTION | |
| 1. | Press release, dated October 24, 2013, announcing third quarter 2013 results for CEMEX, S.A.B. de C.V. (NYSE:CX). | |
| 2. | Third quarter 2013 results for CEMEX, S.A.B. de C.V. (NYSE:CX). | |
| 3. | Presentation regarding third quarter 2013 results for CEMEX, S.A.B. de C.V. (NYSE:CX). | |
Exhibit 1
| Media Relations Jorge Pérez +52(81) 8888-4334 mr@cemex.com |
Investor Relations Eduardo Rendón +52(81) 8888-4256 ir@cemex.com |
Analyst Relations Luis Garza +52(81) 8888-4136 ir@cemex.com |
CEMEX REPORTS THIRD-QUARTER
2013 RESULTS
MONTERREY, MEXICO, OCTOBER 24, 2013 – CEMEX, S.A.B. de C.V. (“CEMEX”) (NYSE: CX), announced today that consolidated net sales reached U.S.$4.0 billion during the third quarter of 2013, an increase of 3% versus the comparable period in 2012. Operating EBITDA increased by 2% during the quarter to U.S.$747 million versus the same period in 2012.
CEMEX’s Consolidated Third-Quarter 2013 Financial and Operational Highlights
| • | The increase in consolidated net sales was due to higher prices of our products in local currency terms and higher volumes in most of our regions. |
| • | Operating earnings before other expenses, net, in the third quarter increased by 14%, to U.S.$467 million. |
| • | Reporting a narrower controlling interest net loss of U.S.$155 million during the third quarter of 2013 from a loss of U.S.$203 million in the same period last year. |
| • | Operating EBITDA increased during the quarter by 2%, to U.S.$747 million. |
| • | Operating EBITDA margin decreased by 0.2 percentage points on a year-over-year basis reaching 18.6%. |
| • | Free cash flow after maintenance capital expenditures for the quarter was U.S.$245 million, compared with U.S.$204 million in the same quarter of 2012. |
Fernando A. González, Executive Vice President of Finance and Administration, said: “We are pleased to report continued growth in operating EBITDA on a year-over-year basis supported by the increase in our volumes in most of our regions and an increase in our consolidated prices in local-currency terms for our three main products on a year-over-year basis. We continue to be focused on our companywide efforts to improve our operating efficiencies and the value we generate from our asset base while delivering better value to our customers.
In Mexico, we are encouraged by the prospects going forward given the investment plans and other initiatives recently announced by the federal government to support the infrastructure and housing sectors, as well as the economy in general.”
Consolidated Corporate Results
During the third quarter of 2013, controlling interest net income was a loss of U.S.$155 million, an improvement over a loss of U.S.$203 million in the same period last year.
Total debt plus perpetual notes increased by U.S.$182 million during the quarter.
Geographical Markets Third-Quarter 2013 Highlights
Net sales in our operations in Mexico decreased 11% in the third quarter of 2013 to U.S.$776 million, compared with U.S.$875 million in the third quarter of 2012. Operating EBITDA decreased by 21% to U.S.$248 million versus the same period of last year.
CEMEX’s operations in the United States reported net sales of U.S.$891 million in the third quarter of 2013, up 8% from the same period in 2012. Operating EBITDA increased to U.S.$78 million in the quarter, versus a gain of U.S.$27 million in the same quarter of 2012.
In Northern Europe, net sales for the third quarter of 2013 increased 6% to U.S.$1,169 million, compared with U.S.$1,105 million in the third quarter of 2012. Operating EBITDA was U.S.$162 million for the quarter, 14% higher than the same period last year.
Third-quarter net sales in the Mediterranean region were U.S.$375 million, 9% higher compared with U.S.$342 million during the third quarter of 2012. Operating EBITDA decreased 21% to U.S.$78 million for the quarter versus the comparable period in 2012.
CEMEX’s operations in South, Central America and the Caribbean reported net sales of U.S.$596 million during the third quarter of 2013, representing an increase of 15% over the same period of 2012. Operating EBITDA increased 19% to U.S.$210 million in the third quarter of 2013, from U.S.$177 million in the third quarter of 2012.
Operations in Asia reported a 5% increase in net sales for the third quarter of 2013, to U.S.$139 million, versus the third quarter of 2012, and operating EBITDA for the quarter was U.S.$36 million, up 27% from the same period last year.
CEMEX is a global building materials company that provides high-quality products and reliable service to customers and communities in more than 50 countries throughout the world. CEMEX has a rich history of improving the well-being of those it serves through its efforts to pursue innovative industry solutions and efficiency advancements and to promote a sustainable future.
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This press release contains forward-looking statements and information that are necessarily subject to risks, uncertainties and assumptions. Many factors could cause the actual results, performance or achievements of CEMEX to be materially different from those expressed or implied in this release, including, among others, changes in general economic, political, governmental and business conditions globally and in the countries in which CEMEX does business, changes in interest rates, changes in inflation rates, changes in exchange rates, the level of construction generally, changes in cement demand and prices, changes in raw material and energy prices, changes in business strategy and various other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein. CEMEX assumes no obligation to update or correct the information contained in this press release.
Operating EBITDA is defined as operating income plus depreciation and operating amortization. Free Cash Flow is defined as Operating EBITDA minus net interest expense, maintenance and expansion capital expenditures, change in working capital, taxes paid, and other cash items (net other expenses less proceeds from the disposal of obsolete and/or substantially depleted operating fixed assets that are no longer in operation). Net debt is defined as total debt minus the fair value of cross-currency swaps associated with debt minus cash and cash equivalents. The Consolidated Funded Debt to Operating EBITDA ratio is calculated by dividing Consolidated Funded Debt at the end of the quarter by Operating EBITDA for the last twelve months. All of the above items are presented under the guidance of International Financial Reporting Standards as issued by the International Accounting Standards Board. Operating EBITDA and Free Cash Flow (as defined above) are presented herein because CEMEX believes that they are widely accepted as financial indicators of CEMEX’s ability to internally fund capital expenditures and service or incur debt. Operating EBITDA and Free Cash Flow should not be considered as indicators of CEMEX’s financial performance, as alternatives to cash flow, as measures of liquidity or as being comparable to other similarly titled measures of other companies.
| Exhibit 2 |
2013 THIRD QUARTER RESULTS Stock Listing Information NYSE (ADS) Ticker: CX Mexican Stock Exchange Ticker: CEMEXCPO Ratio of CEMEXCPO to CX = 10:1 Investor Relations In the United States: + 1 877 7CX NYSE In Mexico: + 52 (81) 8888 4292 E-Mail: ir@cemex.com
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OPERATING AND FINANCIAL HIGHLIGHTS January—September Third Quarter l-t-l l-t-l 2013 2012 % Var. % Var.* 2013 2012 % Var. % Var.* Consolidated cement volume (thousand of metric tons) 48,681 50,077 (3%) 17,094 17,146 (0%) Consolidated ready-mix volume (thousand of cubic meters) 40,947 41,199 (1%) 14,665 14,512 1% Consolidated aggregates volume (thousand of metric tons) 120,314 118,874 1% 44,111 44,078 0% Net sales 11,353 11,274 1% 0% 4,022 3,899 3% 3% Gross profit 3,491 3,308 6% 5% 1,298 1,201 8% 8% Gross profit margin 30.8% 29.3% 1.5pp 32.3% 30.8% 1.5pp Operating earnings before other expenses, net 1,160 1,017 14% 15% 467 410 14% 16% Operating earnings before other expenses, net margin 10.2% 9.0% 1.2pp 11.6% 10.5% 1.1pp Consolidated net income (loss) (512) (411) (25%) (126) (197) 36% Controlling interest net income (loss) (587) (423) (39%) (155) (203) 23% Operating EBITDA 2,001 2,008 (0%) 0% 747 735 2% 3% Operating EBITDA margin 17.6% 17.8% (0.2pp) 18.6% 18.8% (0.2pp) Free cash flow after maintenance capital expenditures (311) (57) (448%) 245 204 20% Free cash flow (382) (150) (155%) 209 171 22% Net debt plus perpetual notes 16,235 16,866 (4%) 16,235 16,866 (4%) Total debt 16,655 17,180 (3%) 16,655 17,180 (3%) Total debt plus perpetual notes 17,130 17,651 (3%) 17,130 17,651 (3%) Earnings (loss) per ADS (0.50) (0.37) (37%) (0.13) (0.17) 24% Fully diluted earnings (loss) per ADS (1) (0.50) (0.37) (37%) (0.13) (0.17) 24% Average ADSs outstanding 1,168.7 1,158.4 1% 1,170.5 1,161.1 1% Employees 42,853 45,087 (5%) 42,853 45,087 (5%) In millions of US dollars, except percentages, employees, and per-ADS amounts. Average ADSs outstanding are presented in millions. Please refer to page 8 for end-of quarter CPO-equivalent units outstanding. *Like-to-like (“l-t-l”) percentage variations adjusted for investments/divestments and currency fluctuations. (1)For 2013 and 2012, the effect of the potential dilutive shares generate anti-dilution; therefore, there is no change between the reported basic and diluted loss per share. Consolidated net sales in the third quarter of 2013 increased to US$4.0 billion, representing an increase of 3% compared with the third quarter of 2012. The increase in consolidated net sales was due to higher prices of our products in local currency terms in most of our regions, as well as higher volumes in the U.S., and in our Mediterranean, Northern Europe, Asia and South, Central America and the Caribbean regions. Cost of sales as a percentage of net sales decreased by 1.5pp during the third quarter of 2013 compared with the same period last year. The decrease includes a reduction in workforce related to our cost reduction initiatives and lower electricity costs. Operating expenses as a percentage of net sales increased by 0.4pp during the third quarter of 2013 compared with the same period last year, from 20.3% to 20.7%. Operating EBITDA increased by 2% to US$747 million during the third quarter of 2013 compared with the same period last year. The increase was due to higher contributions from the U.S., and the Northern Europe, South, Central America and the Caribbean, and Asia regions. Operating EBITDA margin decreased by 0.2pp from 18.8% in the third quarter of 2012 to 18.6% this quarter. Other expenses, net, for the quarter were US$107 million, which mainly included impairments of fixed assets, severance payments and a loss in sales of fixed assets. Gain (loss) on financial instruments for the quarter was a gain of US$42 million, resulting mainly from derivatives related to CEMEX shares. Foreign exchange results for the quarter was a gain of US$21 million, resulting mainly from the fluctuation the Mexican peso versus the U.S. dollar. Controlling interest net income (loss) was a loss of US$155 million in the third quarter of 2013 versus a loss of US$203 million in the same quarter of 2012. The smaller quarterly loss primarily reflects higher operating earnings before other expenses, net, a positive effect in other expenses, a gain in foreign exchange fluctuations and the gain on financial instruments partially offset by a negative effect in financial expenses and higher income taxes. Total debt plus perpetual notes increased by US$182 million during the quarter. 2013 Third Quarter Results Page 2
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OPERATING RESULTS Mexico January—September Third Quarter 2013 2012 % Var. l-t-l % Var.* 2013 2012 % Var. l-t-l % Var.* Net sales 2,402 2,545 (6%) (9%) 776 875 (11%) (12%) Operating EBITDA 761 910 (16%) (19%) 248 313 (21%) (21%) Operating EBITDA margin 31.7% 35.8% (4.1pp) 31.9% 35.8% (3.9pp) In millions of US dollars, except percentages. Domestic gray cement Ready-mix Aggregates Year-over-year percentage variation January—September Third Quarter January—September Third Quarter January—September Third Quarter Volume (10%) (13%) (7%) (9%) 2% (1%) Price (USD) 1% (3%) 4% 2% 5% 3% Price (local currency) (2%) (3%) 1% 2% 1% 3% Our Mexican operations’ domestic gray cement volumes decreased by 13% during the quarter versus the same period last year, while ready-mix volumes declined by 9% during the same period. During the first nine months of the year, domestic gray cement volumes decreased by 10% while ready-mix volumes declined by 7% versus the comparable period a year ago. Our volumes during the quarter were negatively impacted by the low levels of infrastructure spending reflecting the transition process of the new government, by the reduction in sales of bagged cement to social programs and by the adverse weather conditions in most regions in the country. On the formal residential sector, activity continued to be weak due to continued financing constraints and high inventories. The industrial-and-commercial sector continued showing positive performance during the same period. United States January—September Third Quarter 2013 2012 % Var. l-t-l % Var.* 2013 2012 % Var. l-t-l % Var.* Net sales 2,495 2,305 8% 8% 891 826 8% 8% Operating EBITDA 178 30 496% 496% 78 27 189% 189% Operating EBITDA margin 7.1% 1.3% 5.8pp 8.8% 3.3% 5.5pp In millions of US dollars, except percentages. Domestic gray cement Ready-mix Aggregates Year-over-year percentage variation January—September Third Quarter January—September Third Quarter January—September Third Quarter Volume 4% 7% 10% 8% 6% (4%) Price (USD) 3% 2% 6% 6% 4% 10% Price (local currency) 3% 2% 6% 6% 4% 10% Domestic gray cement, and ready-mix volumes for CEMEX’s operations in the United States increased by 7% and 8%, respectively, during the third quarter of 2013 versus the same period last year, while aggregates volumes decreased by 4% during the same period. During the first nine months of the year and on a year-over-year basis, domestic gray cement, ready mix, and aggregates increased by 4%, 10% and 6%, respectively. Sales volumes for the quarter reflect improved demand in most of our markets. The residential sector continued to be the main driver of demand during the quarter sustained by strong fundamentals such as high affordability, large pent-up demand and low levels of inventories. The industrial-and-commercial sector also contributed favorably to demand growth. 2013 Third Quarter Results Page 3
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OPERATING RESULTS Northern Europe January—September Third Quarter 2013 2012 % Var. l-t-l % Var.* 2013 2012 % Var. l-t-l % Var.* Net sales 3,012 3,086 (2%) (3%) 1,169 1,105 6% 2% Operating EBITDA 253 324 (22%) (23%) 162 143 14% 9% Operating EBITDA margin 8.4% 10.5% (2.1pp) 13.9% 12.9% 1.0pp In millions of US dollars, except percentages. Domestic gray cement Ready-mix Aggregates Year-over-year percentage variation January—September Third Quarter January—September Third Quarter January—September Third Quarter Volume (4%) 2% (5%) 1% (1%) 3% Price (USD) 1% 4% 3% 6% 3% 6% Price (local currency) 0% 1% 2% 2% 2% 2% Our domestic gray cement volumes in the Northern Europe region increased by 2% during the third quarter of 2013 and decreased by 4% during the first nine months of the year versus the comparable period in 2012. In the United Kingdom, domestic gray cement and ready-mix volumes increased, on a year-over-year basis, by 12%, and 8%, respectively, while our aggregates volumes remained flat during the third quarter of 2013. For the first nine months of the year our domestic gray cement and ready-mix volumes increased by 7%, and 4%, respectively and our aggregates volumes decreased by 2%, versus the comparable period in the previous year. Improved macroeconomic conditions contributed to higher activity in the country. Cement volumes during the quarter were driven by the residential sector which benefited from the governmental incentives to promote home ownership. In our operations in France, domestic ready-mix volumes decreased by 1% and our aggregates volumes increased by 9% during the third quarter of 2013 versus the comparable period last year. During the first nine months of the year, ready-mix volumes decreased by 9% and our aggregates volumes increased by 3%, on a year-over-year basis. Infrastructure activity continues to be supported by a number of ongoing highway and high-speed-railway projects that started during 2012. The year-over-year activity in the residential sector was affected by higher unemployment rate, the reduction of government housing incentives, and a less attractive buy-to-let program. Improved activity in the industrial-and-commercial sector, especially in industrial buildings, mitigated the decline in volumes. In Germany, our domestic gray cement volumes increased by 6% during the third quarter and remained flat during the first nine months of the year on a year-over-year basis. Low unemployment and mortgage rates, as well as the increase in wages and salaries benefited residential activity, which was the main driver of demand for our products. Performance of the infrastructure sector remained stable. Domestic gray cement volumes of our operations in Poland declined by 14% during the quarter and decreased by 22% during the first nine months of the year versus the comparable periods in 2012. Our volumes during the quarter were affected by market dynamics while construction activity remained stable. A slight reduction in home inventories was evidenced in the residential sector while the industrial-and-commercial sector remained stable. 2013 Third Quarter Results Page 4
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OPERATING RESULTS Mediterranean January—September Third Quarter 2013 2012 % Var. l-t-l % Var.* 2013 2012 % Var. l-t-l % Var.* Net sales 1,122 1,103 2% 3% 375 342 9% 8% Operating EBITDA 246 293 (16%) (11%) 78 99 (21%) (18%) Operating EBITDA margin 21.9% 26.5% (4.6pp) 20.8% 28.9% (8.1pp) In millions of US dollars, except percentages. Domestic gray cement Ready-mix Aggregates Year-over-year percentage variation January—September Third Quarter January—September Third Quarter January—September Third Quarter Volume (2%) 1% 6% 7% (4%) (8%) Price (USD) (1%) 2% 6% 11% 11% 17% Price (local currency) 7% 10% 2% 2% 5% 6% Our domestic gray cement volumes in the Mediterranean region increased by 1% during the third quarter and decreased by 2% during the first nine months of the year versus the same periods in 2012. Domestic gray cement volumes for our operations in Spain decreased by 23% and our ready-mix volumes declined by 18% on a year-over-year basis during the quarter. For the first nine months of the year, domestic gray cement volumes decreased by 29%, while ready-mix volumes declined by 29% compared with the same period in 2012. The decrease in volumes for building materials during the quarter reflects the adverse economic situation in the country. The continued fiscal austerity measures and spending cuts kept infrastructure activity at very low levels. In the residential sector, there has been a gradual reduction in home inventories. In Egypt, our domestic gray cement volumes increased by 7% during the third quarter of 2013 and increased by 7% during the first nine months of the year on a year-over-year basis driven mainly by the informal residential sector and supported by our alternative fuel strategy in the country. South, Central America and the Caribbean January—September Third Quarter 2013 2012 % Var. l-t-l % Var.* 2013 2012 % Var. l-t-l % Var.* Net sales 1,657 1,574 5% 9% 596 520 15% 20% Operating EBITDA 610 544 12% 15% 210 177 19% 24% Operating EBITDA margin 36.8% 34.6% 2.2pp 35.3% 34.0% 1.3pp In millions of US dollars, except percentages. Domestic gray cement Ready-mix Aggregates Year-over-year percentage variation January—September Third Quarter January—September Third Quarter January—September Third Quarter Volume 2% 9% 1% 12% 5% 17% Price (USD) (0%) (4%) 5% 3% (1%) (6%) Price (local currency) 3% 1% 8% 8% 2% (2%) Our domestic gray cement volumes in the region increased by 9% during the third quarter of 2013 and increased by 2% during the first nine months of the year versus the comparable periods last year. Domestic gray cement volumes for our operations in Colombia increased by 8% during the third quarter while both, our ready-mix and aggregates volumes increased by 15% compared to the same period a year ago. For the first nine months of the year cement volumes decreased by 1%, while our ready mix, and aggregates volumes increased by 9% and 5%, respectively, on a year-over-year basis. During the quarter, the residential sector continued to be an important driver of demand, supported by the 100-thousand government-sponsored free-home program. The industrial-and-commercial sector continued its favorable trend supported by the positive economic outlook, higher investor confidence and the new trade agreements signed by Colombia. 2013 Third Quarter Results Page 5
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OPERATING RESULTS Asia January—September Third Quarter 2013 2012 % Var. l-t-l % Var.* 2013 2012 % Var. l-t-l % Var.* Net sales 444 403 10% 10% 139 133 5% 9% Operating EBITDA 99 70 40% 40% 36 28 27% 32% Operating EBITDA margin 22.2% 17.4% 4.8pp 25.9% 21.3% 4.6pp In millions of US dollars, except percentages. Domestic gray cement Ready-mix Aggregates Year-over-year percentage variation January—September Third Quarter January—September Third Quarter January—September Third Quarter Volume 6% 10% (8%) (23%) 52% 100% Price (USD) 9% 2% 4% 4% 18% 26% Price (local currency) 8% 5% 5% 9% 20% 32% Our domestic gray cement volumes in the region increased by 10% during the third quarter and increased by 6% during the first nine months of 2013 on a year-over-year basis. In the Philippines, our domestic gray cement volumes increased by 15% during the third quarter of 2013 and increased by 9% during the first nine months of 2013 versus the comparable periods of last year. The residential sector was the main driver of demand during the quarter supported by the increased activity from foreign buyers and favorable conditions such as stable level of inflation and mortgage rates, as well as healthy remittances inflows. The infrastructure and industrial-and-commercial sectors continue with their positive trend during the same period. 2013 Third Quarter Results Page 6
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OPERATING EBITDA, FREE CASH FLOW AND DEBT-RELATED INFORMATION Operating EBITDA and free cash flow January—September Third Quarter 2013 2012 % Var 2013 2012 % Var Operating earnings before other expenses, net 1,160 1,017 14% 467 410 14% + Depreciation and operating amortization 842 991 281 325 Operating EBITDA 2,001 2,008 (0%) 747 735 2%—Net financial expense 1,066 1,036 348 347—Maintenance capital expenditures 255 219 105 96—Change in working capital 497 509 (34) 53—Taxes paid 440 298 35 48—Other cash items (net) 55 3 48 (12) Free cash flow after maintenance capital expenditures (311) (57) (448%) 245 204 20%—Strategic capital expenditures 72 93 36 33 Free cash flow (382) (150) (155%) 209 171 22% In millions of US dollars, except percentages. The free cash flow during the quarter plus the increase in debt were mainly used for cash replenishment and to pay the premium of the 2016 Notes as part of the August tender offer. About two thirds of the increase in debt during the quarter is related to a negative foreign-exchange conversion effect of US$82 million as well as an increase in the debt component of our convertible securities, which are non-cash items. Information on debt and perpetual notes Second Third Third Quarter Quarter Quarter 2013 2012 % Var 2013 2013 2012 Total debt (1) 16,655 17,180 (3%) 16,476 Currency denomination Short-term 3% 1% 3% US dollar 85% 82% Long-term 97% 99% 97% Euro 13% 16% Perpetual notes 475 471 1% 472 Mexican peso 2% 2% Cash and cash equivalents 895 785 14% 746 Other 0% 0% Net debt plus perpetual notes 16,235 16,866 (4%) 16,201 Interest rate Consolidated funded debt (2)/EBITDA (3) 5.56 5.54 Fixed 70% 59% Variable 30% 41% Interest coverage (3) (4) 2.08 2.06 In millions of US dollars, except percentages and ratios. (1) Includes convertible notes and capital leases, in accordance with International Financial Reporting Standards (IFRS). (2) Consolidated funded debt as of September 30, 2013 was US$14,495 million, in accordance with our contractual obligations under the Facilities Agreement. (3) EBITDA calculated in accordance with IFRS. (4) Interest expense calculated in accordance with our contractual obligations under the Facilities Agreement. 2013 Third Quarter Results Page 7
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EQUITY-RELATED AND DERIVATIVE INSTRUMENTS INFORMATION Equity-related information One CEMEX ADS represents ten CEMEX CPOs. The following amounts are expressed in CPO terms. Beginning-of-quarter CPO-equivalent units outstanding 11,367,489,161 Less increase (decrease) in the number of CPOs held in subsidiaries (250,400) Stock-based compensation 36,904,518 End-of-quarter CPO-equivalent units outstanding 11,404,644,079 Outstanding units equal total CPOs issued by CEMEX less CPOs held in subsidiaries. CEMEX has outstanding mandatorily convertible securities which, upon conversion, will increase the number of CPOs outstanding by approximately 202 million, subject to antidilution adjustments. Employee long-term compensation plans As of September 30, 2013, executives had outstanding options on a total of 5,056,566 CPOs, with a weighted-average strike price of approximately US$1.56 per CPO (equivalent to US$15.60 per ADS). Starting in 2005, CEMEX began offering executives a restricted stock-ownership program. As of September 30, 2013, our executives held 32,540,320 restricted CPOs, representing 0.3% of our total CPOs outstanding as of such date. Derivative instruments The following table shows the notional amount for each type of derivative instrument and the aggregate fair market value for all of CEMEX’s derivative instruments as of the last day of each quarter presented. Third Quarter Second Quarter 2013 2012 2013 Notional amount of equity related derivatives (1) 2,410 2,774 2,410 Estimated aggregate fair market value (1) (2) (3) 358 (57) 320 In millions of US dollars. The estimated aggregate fair market value represents the approximate settlement result as of the valuation date, based upon quoted market prices and estimated settlement costs, which fluctuate over time. Fair market values and notional amounts do not represent amounts of cash currently exchanged between the parties; cash amounts will be determined upon termination of the contracts considering the notional amounts and quoted market prices as well as other derivative items as of the settlement date. Fair market values should not be viewed in isolation, but rather in relation to the fair market values of the underlying hedge transactions and the overall reduction in CEMEX’s exposure to the risks being hedged. Note: Under IFRS, companies are required to recognize all derivative financial instruments on the balance sheet as assets or liabilities, at their estimated fair market value, with changes in such fair market values recorded in the income statement, except when transactions are entered into for cash-flow-hedging purposes, in which case changes in the fair market value of the related derivative instruments are recognized temporarily in equity and then reclassified into earnings as the inverse effects of the underlying hedged items flow through the income statement. As of September 30, 2013, in connection with the fair market value recognition of its derivatives portfolio, CEMEX recognized increases in its assets and liabilities resulting in a net asset of US$396 million, including a liability of US$34 million corresponding to an embedded derivative related to our mandatorily convertible securities, which according to our debt agreements, is presented net of the assets associated with the derivative instruments. The notional amounts of derivatives substantially match the amounts of underlying assets, liabilities, or equity transactions on which the derivatives are being entered into. (1) Excludes an interest-rate swap related to our long-term energy contracts. As of September 30, 2013, the notional amount of this derivative was US$177 million, with a positive fair market value of approximately US$38 million. (2) Excludes two exchange rate derivatives, as of September 30, 2012, the notional amount of both derivatives were US$100 million, with a positive fair market value of an approximately US$1 million. As of September 30, 2013, there are no exchange rate derivatives. (3) Net of cash collateral deposited under open positions. Cash collateral was US$8 million as of September 30, 2013. (4) As required by IFRS, the estimated aggregate fair market value as of September 30, 2013 includes a liability of US$34 million relating to an embedded derivative in CEMEX’s mandatorily convertible securities while the estimated aggregate fair market value as of September 30, 2012 includes a liability of US$232 million, related to an embedded derivative in CEMEX’s optional convertible subordinated notes. For more information please refer to page 17 “Change in the Parent Company’s functional currency.” 2013 Third Quarter Results Page 8
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OPERATING RESULTS Consolidated Income Statement & Balance Sheet CEMEX, S.A.B. de C.V. and Subsidiaries (Thousands of U.S. Dollars, except per ADS amounts) January—September Third Quarter like-to-like like-to-like INCOME STATEMENT 2013 2012 % Var. % Var.* 2013 2012 % Var. % Var.* Net sales 11,352,708 11,273,796 1% 0% 4,022,119 3,899,010 3% 3% Cost of sales (7,861,608) (7,965,844) 1% (2,724,337) (2,698,221) (1%) Gross profit 3,491,099 3,307,953 6% 5% 1,297,782 1,200,788 8% 8% Operating expenses (2,331,567) (2,291,415) (2%) (831,281) (790,439) (5%) Operating earnings before other expenses, net 1,159,532 1,016,538 14% 15% 466,501 410,350 14% 16% Other expenses, net (233,191) (191,934) (21%) (107,011) (164,959) 35% Operating earnings 926,342 824,604 12% 359,490 245,390 46% Financial expense (1,139,392) (1,051,857) (8%) (407,080) (356,911) (14%) Other financial income (expense), net 99,330 49,729 100% 53,789 16,530 225% Financial income 23,785 34,333 (31%) 7,328 10,519 (30%) Results from financial instruments, net 113,400 31,352 262% 41,877 19,283 117% Foreign exchange results 5,495 21,417 (74%) 21,064 (3,242) N/A Effects of net present value on assets and liabilities and others, net (43,350) (37,373) (16%) (16,480) (10,031) (64%) Equity in gain (loss) of associates 7,869 32,571 (76%) 5,210 20,623 (75%) Income (loss) before income tax (105,851) (144,954) 27% 11,408 (74,368) N/A Income tax (406,645) (265,865) (53%) (137,512) (122,955) (12%) Consolidated net income (loss) (512,496) (410,819) (25%) (126,104) (197,323) 36% Non-controlling interest net income (loss) 74,210 12,118 512% 29,359 5,317 452% Controlling interest net income (loss) (586,707) (422,937) (39%) (155,462) (202,640) 23% Operating EBITDA 2,001,210 2,007,636 (0%) 0% 747,122 734,883 2% 3% Earnings (loss) per ADS (0.50) (0.37) (37%) (0.13) (0.17) 24% As of September 30 BALANCE SHEET 2013 2012 % Var. Total assets 36,974,388 39,043,563 (5%) Cash and cash equivalents 895,371 785,237 14% Trade receivables less allowance for doubtful accounts 2,177,678 2,182,687 (0%) Other accounts receivable 548,096 499,675 10% Inventories, net 1,276,893 1,288,113 (1%) Other current assets 325,180 316,330 3% Current assets 5,223,218 5,072,043 3% Property, machinery and equipment, net 15,711,679 16,563,208 (5%) Other assets 16,039,491 17,408,311 (8%) Total liabilities 25,096,945 26,852,425 (7%) Current liabilities 4,616,162 4,250,027 9% Long-term liabilities 13,816,289 14,807,684 (7%) Other liabilities 6,664,494 7,794,713 (14%) Total stockholders’ equity 11,877,443 12,191,138 (3%) Non-controlling interest and perpetual instruments 1,126,346 694,778 62% Total controlling interest 10,751,097 11,496,360 (6%) 2013 Third Quarter Results Page 9
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OPERATING RESULTS Consolidated Income Statement & Balance Sheet CEMEX, S.A.B. de C.V. and Subsidiaries (Thousands of Mexican Pesos in nominal terms, except per ADS amounts) January—September Third Quarter INCOME STATEMENT 2013 2012 % Var. 2013 2012 % Var. Net sales 145,087,605 148,926,851 (3%) 52,609,317 51,232,988 3% Cost of sales (100,471,354) (105,228,796) 5% (35,634,334) (35,454,629) (1%) Gross profit 44,616,251 43,698,056 2% 16,974,983 15,778,359 8% Operating expenses (29,797,427) (30,269,595) 2% (10,873,150) (10,386,362) (5%) Operating earnings before other expenses, net 14,818,824 13,428,461 10% 6,101,834 5,391,996 13% Other expenses, net (2,980,180) (2,535,446) (18%) (1,399,701) (2,167,567) 35% Operating earnings 11,838,645 10,893,014 9% 4,702,132 3,224,428 46% Financial expense (14,561,428) (13,895,034) (5%) (5,324,610) (4,689,807) (14%) Other financial income (expense), net 1,269,439 656,923 93% 703,555 217,198 224% Financial income 303,971 453,544 (33%) 95,847 138,223 (31%) Results from financial instruments, net 1,449,258 414,164 250% 547,751 253,375 116% Foreign exchange results 70,223 282,913 (75%) 275,516 (42,596) N/A Effects of net present value on assets and liabilities and others, net (554,012) (493,697) (12%) (215,560) (131,804) (64%) Equity in gain (loss) of associates 100,567 430,261 (77%) 68,141 270,987 (75%) Income (loss) before income tax (1,352,776) (1,914,836) 29% 149,217 (977,193) N/A Income tax (5,196,928) (3,512,079) (48%) (1,798,657) (1,615,633) (11%) Consolidated net income (loss) (6,549,704) (5,426,915) (21%) (1,649,440) (2,592,827) 36% Non-controlling interest net income (loss) 948,410 160,079 492% 384,010 69,866 450% Controlling interest net income (loss) (7,498,115) (5,586,995) (34%) (2,033,449) (2,662,693) 24% Operating EBITDA 25,575,470 26,520,878 (4%) 9,772,356 9,656,366 1% Earnings (loss) per ADS (6.42) (4.82) (33%) (1.74) (2.29) 24% As of September 30 BALANCE SHEET 2013 2012 % Var. Total assets 484,364,487 502,490,654 (4%) Cash and cash equivalents 11,729,356 10,106,004 16% Trade receivables less allowance for doubtful accounts 28,527,585 28,091,188 2% Other accounts receivable 7,180,060 6,430,821 12% Inventories, net 16,727,296 16,578,014 1% Other current assets 4,259,856 4,071,173 5% Current assets 68,424,153 65,277,200 5% Property, machinery and equipment, net 205,823,001 213,168,493 (3%) Other assets 210,117,334 224,044,961 (6%) Total liabilities 328,769,986 345,590,707 (5%) Current liabilities 60,471,727 54,697,853 11% Long-term liabilities 182,557,269 190,574,891 (4%) Other liabilities 85,740,989 100,317,962 (15%) Total stockholders’ equity 155,594,502 156,899,948 (1%) Non-controlling interest and perpetual instruments 14,755,132 8,941,791 65% Total controlling interest 140,839,370 147,958,157 (5%) 2013 Third Quarter Results Page 10
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OPERATING RESULTS Operating Summary per Country In thousands of U.S. dollars January—September Third Quarter like-to-like like-to-like NET SALES 2013 2012 % Var. % Var. * 2013 2012 % Var. % Var. * Mexico 2,401,882 2,545,195 (6%) (9%) 776,082 874,556 (11%) (12%) U.S.A. 2,495,380 2,305,377 8% 8% 891,106 825,737 8% 8% Northern Europe 3,012,071 3,085,616 (2%) (3%) 1,168,845 1,105,346 6% 2% Mediterranean 1,121,799 1,103,189 2% 3% 374,618 342,469 9% 8% South, Central America and the Caribbean 1,657,024 1,573,988 5% 9% 596,377 520,334 15% 20% Asia 443,623 402,729 10% 10% 138,903 132,646 5% 9% Others and intercompany eliminations 220,928 257,702 (14%) (14%) 76,187 97,923 (22%) (22%) TOTAL 11,352,708 11,273,796 1% 0% 4,022,119 3,899,010 3% 3% GROSS PROFIT Mexico 1,136,892 1,257,121 (10%) (13%) 373,802 435,527 (14%) (15%) U.S.A. 333,841 174,713 91% 91% 144,801 98,324 47% 47% Northern Europe 742,152 759,280 (2%) (3%) 347,214 315,442 10% 6% Mediterranean 380,109 369,989 3% 7% 114,333 120,879 (5%) (3%) South, Central America and the Caribbean 765,942 737,891 4% 7% 270,131 239,941 13% 18% Asia 127,378 97,994 30% 29% 46,569 37,948 23% 28% Others and intercompany eliminations 4,784 (89,035) N/A N/A 931 (47,273) N/A N/A TOTAL 3,491,099 3,307,953 6% 5% 1,297,782 1,200,788 8% 8% OPERATING EARNINGS BEFORE OTHER EXPENSES, NET Mexico 616,336 761,687 (19%) (22%) 200,101 264,935 (24%) (25%) U.S.A. (169,093) (347,364) 51% 51% (36,006) (92,502) 61% 61% Northern Europe 85,075 139,011 (39%) (38%) 101,806 82,035 24% 25% Mediterranean 165,939 206,179 (20%) (14%) 52,890 71,695 (26%) (22%) South, Central America and the Caribbean 546,511 481,461 14% 17% 189,360 155,667 22% 27% Asia 74,921 48,980 53% 52% 28,359 21,071 35% 39% Others and intercompany eliminations (160,156) (273,417) 41% 43% (70,010) (92,552) 24% 22% TOTAL 1,159,532 1,016,538 14% 15% 466,501 410,350 14% 16% 2013 Third Quarter Results Page 11
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OPERATING RESULTS Operating Summary per Country EBITDA in thousands of U.S. dollars. EBITDA margin as a percentage of net sales. January—September Third Quarter like-to-like like-to-like OPERATING EBITDA 2013 2012 % Var. % Var. * 2013 2012 % Var. % Var. * Mexico 761,375 910,449 (16%) (19%) 247,586 313,391 (21%) (21%) U.S.A. 177,527 29,764 496% 496% 78,499 27,174 189% 189% Northern Europe 252,893 324,303 (22%) (23%) 162,416 142,903 14% 9% Mediterranean 245,991 292,689 (16%) (11%) 77,935 99,100 (21%) (18%) South, Central America and the Caribbean 609,674 544,005 12% 15% 210,327 176,813 19% 24% Asia 98,589 70,172 40% 40% 35,934 28,259 27% 32% Others and intercompany eliminations (144,839) (163,746) 12% 16% (65,574) (52,756) (24%) (22%) TOTAL 2,001,210 2,007,636 (0%) 0% 747,122 734,883 2% 3% OPERATING EBITDA MARGIN Mexico 31.7% 35.8% 31.9% 35.8% U.S.A. 7.1% 1.3% 8.8% 3.3% Northern Europe 8.4% 10.5% 13.9% 12.9% Mediterranean 21.9% 26.5% 20.8% 28.9% South, Central America and the Caribbean 36.8% 34.6% 35.3% 34.0% Asia 22.2% 17.4% 25.9% 21.3% TOTAL 17.6% 17.8% 18.6% 18.8% 2013 Third Quarter Results Page 12
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OPERATING RESULTS Volume Summary Consolidated volume summary Cement and aggregates: Thousands of metric tons. Ready-mix: Thousands of cubic meters. January—September Third Quarter 2013 2012 % Var. 2013 2012 % Var. Consolidated cement volume 1 48,681 50,077 (3%) 17,094 17,146 (0%) Consolidated ready-mix volume 2 40,947 41,199 (1%) 14,665 14,512 1% Consolidated aggregates volume 2 120,314 118,874 1% 44,111 44,078 0% Per-country volume summary January—September Third Quarter Third Quarter 2013 Vs. DOMESTIC GRAY CEMENT VOLUME 2013 Vs. 2012 2013 Vs. 2012 Second Quarter 2013 Mexico (10%) (13%) (6%) U.S.A. 4% 7% 2% Northern Europe (4%) 2% 15% Mediterranean (2%) 1% (9%) South, Central America and the Caribbean 2% 9% 0% Asia 6% 10% (8%) READY-MIX VOLUME Mexico (7%) (9%) 2% U.S.A. 10% 8% 0% Northern Europe (5%) 1% 7% Mediterranean 6% 7% (9%) South, Central America and the Caribbean 1% 12% 10% Asia (8%) (23%) (34%) AGGREGATES VOLUME Mexico 2% (1%) 6% U.S.A. 6% (4%) (0%) Northern Europe (1%) 3% 6% Mediterranean (4%) (8%) (11%) South, Central America and the Caribbean 5% 17% 11% Asia 52% 100% 6% 1 Consolidated cement volume includes domestic and export volume of gray cement, white cement, special cement, mortar and clinker. 2013 Third Quarter Results Page 13
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OPERATING RESULTS Price Summary Variation in U.S. Dollars January—September Third Quarter Third Quarter 2013 Vs. DOMESTIC GRAY CEMENT PRICE 2013 Vs. 2012 2013 Vs. 2012 Second Quarter 2013 Mexico 1% (3%) (5%) U.S.A. 3% 2% (1%) Northern Europe (*) 1% 4% 1% Mediterranean (*) (1%) 2% (0%) South, Central America and the Caribbean (*) (0%) (4%) (2%) Asia (*) 9% 2% (4%) READY-MIX PRICE Mexico 4% 2% (4%) U.S.A. 6% 6% 2% Northern Europe (*) 3% 6% 0% Mediterranean (*) 6% 11% 2% South, Central America and the Caribbean (*) 5% 3% (1%) Asia (*) 4% 4% 1% AGGREGATES PRICE Mexico 5% 3% (3%) U.S.A. 4% 10% 1% Northern Europe (*) 3% 6% 1% Mediterranean (*) 11% 17% 7% South, Central America and the Caribbean (*) (1%) (6%) (1%) Asia (*) 18% 26% 2% (*) Volume weighted-average price. 2013 Third Quarter Results Page 14
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OPERATING RESULTS Price Summary Variation in Local Currency January—September Third Quarter Third Quarter 2013 Vs. DOMESTIC GRAY CEMENT PRICE 2013 Vs. 2012 2013 Vs. 2012 Second Quarter 2013 Mexico (2%) (3%) (2%) U.S.A. 3% 2% (1%) Northern Europe (*) 0% 1% (1%) Mediterranean (*) 7% 10% (1%) South, Central America and the Caribbean (*) 3% 1% (0%) Asia (*) 8% 5% (0%) READY-MIX PRICE Mexico 1% 2% (1%) U.S.A. 6% 6% 2% Northern Europe (*) 2% 2% (2%) Mediterranean (*) 2% 2% 0% South, Central America and the Caribbean (*) 8% 8% 0% Asia (*) 5% 9% 6% AGGREGATES PRICE Mexico 1% 3% 1% U.S.A. 4% 10% 1% Northern Europe (*) 2% 2% (1%) Mediterranean (*) 5% 6% 5% South, Central America and the Caribbean (*) 2% (2%) 0% Asia (*) 20% 32% 8% (*) Volume weighted-average price. 2013 Third Quarter Results Page 15
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OTHER ACTIVITIES CEMEX announces acceptance for purchase of U.S.$470 million of 9.50% notes due 2016, acceptance for purchase of €179 million of 9.625% notes due 2017 and early settlement of tender offer On October 9, 2013, CEMEX announced that holders of approximately U.S.$470 million of the outstanding 9.50% Senior Secured Notes due 2016 (the “2016 Notes”) issued by CEMEX Finance and holders of approximately €179 million of the outstanding 9.625% Senior Secured Notes due 2017 (the “2017 Notes”) issued by CEMEX Finance LLC tendered their 2016 Notes and/or their 2017 Notes at or prior to the early tender deadline of 5:00 p.m., New York City time, on October 8, 2013 (the “Early Tender Date”), pursuant to CEMEX’s previously announced cash tender offer to purchase any and all of the outstanding 2016 Notes and to purchase up to €220 million (the “Maximum Tender Amount”) of the outstanding 2017 Notes. CEMEX announces tender offer for 9.50% notes due 2016 and 9.625% notes due 2017 On September 25, 2013, CEMEX announced that it has commenced tender offers (the “Tender Offers”) to purchase any and all of the outstanding 9.50% Senior Secured Notes due 2016 (the “2016 Notes”) issued by CEMEX Finance LLC and to purchase up to €150 million (the “Maximum Tender Amount”) of the outstanding 9.625% Senior Secured Notes due 2017 (the “2017 Notes”), issued by CEMEX Finance LLC. On October 3, 2013, CEMEX announced an increase to the Maximum Tender Amount of the 2017 Notes to €220 million from the original amount of €150 million. CEMEX announces pricing of U.S.$1.4 billion in senior secured notes and announces pricing of additional U.S.$100 million in Floating Rate Notes On September 25, 2013, CEMEX announced the pricing of U.S.$1.0 billion of 7.25% Senior Secured Notes due 2021 (the “Fixed Rate Notes”) and U.S.$400 million of Floating Rate Senior Secured Notes due 2018 (the “Floating Rate Notes” and, together with the Fixed Rate Notes, the “New Notes”) denominated in U.S. dollars. The Fixed Rate Notes bear interest at an annual rate of 7.25% and mature on January 15, 2021. The Fixed Rate Notes were issued at par and are callable commencing on January 15, 2018. The Floating Rate Notes bear interest at a floating rate equal to three-month LIBOR plus 4.75% (475 basis points) and mature on October 15, 2018. The Floating Rate Notes were issued at par and are callable commencing on or after the interest payment date immediately preceding their maturity date. The closing of the offerings occurred on October 2, 2013. On September 27, 2013, CEMEX announced the pricing of U.S.$100 million of additional Floating Rate Senior Secured Notes due 2018 (the “Additional Floating Notes”) which constituted part of the same series as the U.S.$400 million of Floating Rate Senior Secured Notes due 2018 (the “Original Floating Notes”) previously announced on September 25, 2013. CEMEX intends to use the approximately U.S.$99.6 million of net proceeds from the offering of Additional Floating Notes, together with the approximately U.S.$1.394 billion of net proceeds from the offerings of Original Notes, to purchase any or all of the U.S.$825 million outstanding 9.50% Senior Secured Notes due 2016 (the “2016 Notes”), issued by CEMEX Finance LLC, and the remainder for general corporate purposes, including to purchase up to €150 million of the outstanding 9.625% Senior Secured Notes due 2017 (the “2017 Notes”), issued by CEMEX Finance LLC, to repay at maturity the 4.75% Notes due 2014, issued by CEMEX Finance Europe B.V., and/or to repay its other indebtedness. CEMEX currently expects to purchase the 2016 Notes at a price of approximately U.S.$1,062.50 for each U.S.$1,000 of 2016 Notes and to purchase the 2017 Notes at a price of approximately €1,063.50 for each €1,000 of 2017 Notes, in each case, plus accrued interest. CEMEX to improve its portfolio in Europe On August 28, 2013, CEMEX announced that it has reached an agreement with Holcim to conduct a series of transactions that will improve CEMEX’s strategic footprint in Europe. CEMEX will acquire all of Holcim’s assets in the Czech Republic, which include one cement plant (cement capacity of 1.1 million tons, clinker capacity of 0.9 million tons), four aggregates quarries and 17 ready-mix plants. The Czech Republic is a market with a strong economy and solid prospects and we expect that acquiring these assets should improve CEMEX’s operations in the country and in Central Europe. CEMEX will divest its assets in the western part of Germany to Holcim, which include one cement plant and two grinding mills (total cement capacity of 2.5 million tons, clinker capacity of 0.9 million tons), one slag granulator, 22 aggregates quarries and 79 ready-mix plants. The German market is an attractive one and CEMEX will still be present in the eastern, northern and southern part of the country with an important footprint. In Spain, CEMEX and Holcim will combine all their cement, ready-mix and aggregates operations. CEMEX will have a 75% controlling interest over the combined operational assets in this country. This transaction will allow CEMEX to better serve the market, which should translate into higher value creation in that country. As part of these transactions, Holcim will pay CEMEX €70 million Euros in cash. Additionally, the transactions are expected to generate synergies that will result in a recurring improvement in CEMEX’s EBITDA of about US$20 million to US$30 million, beginning to be realized in 2014. These transactions are not final as they are subject to the fulfillment of various conditions precedent, mainly confirmatory due diligence, approvals from competition authorities, and from creditors under the Facilities Agreement, among others. In addition, on October 16, 2013 we obtained the necessary consent and approvals from the Facilities Agreement Creditors authorizing the transaction. CEMEX announces acceptance for purchase of U.S.$925 million of 9.50% notes due 2016 and early settlement of tender offer On August 19, 2013, CEMEX announced that holders of approximately U.S.$1.33 billion of the outstanding 9.50% Senior Secured Notes due 2016 (the “Notes”) issued by CEMEX Finance LLC tendered their Notes at or prior to the early tender deadline of 5:00 p.m., New York City time, on August 16, 2013 (the “Early Tender Date”), pursuant to CEMEX’s previously announced cash tender offer to purchase up to U.S.$925 million (the “Maximum Tender Amount”) of the outstanding Notes. The cash tender offer was made pursuant to the offer to purchase dated August 5, 2013 and the related letter of transmittal. Because Notes in excess of the Maximum Tender Amount were validly tendered in the tender offer on or prior to the Early Tender Date, CEMEX accepted U.S.$925 million of such tendered Notes for purchase and paid holders thereof on a pro rata basis according to the pro ration procedures described in the offer to purchase. The early settlement date on which CEMEX made payment for such Notes was August 19, 2013. CEMEX announces pricing of U.S.$1.0 billion in senior secured notes On August 5, 2013, CEMEX announced the pricing of U.S.$1.0 billion of senior secured notes (the “Notes”) denominated in U.S. dollars. The Notes bear interest at an annual rate of 6.5% and mature on December 10, 2019. The Notes were issued at par and are callable commencing on December 10, 2017. The closing of the offering occurred on August 12, 2013. CEMEX intended to use the approximately U.S.$995 million of net proceeds from the offering to purchase a portion of the 9.50% Senior Secured Notes due 2016 (the “2016 Notes”) issued by CEMEX Finance LLC, and the remainder, if any, for general corporate purposes, including the repayment of other indebtedness. CEMEX expected to purchase a portion of the 2016 Notes at a price of approximately U.S.$1,075 for each U.S.$1,000 of 2016 Notes plus accrued interest. 2013 Third Quarter Results Page 16
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OTHER INFORMATION Colombia Tax Matter Regarding the proceedings (requerimientos especiales) initiated by the Colombian Tax Authority (Dirección de Impuestos) in relation to CEMEX Colombia’s 2007 and 2008 year-end tax returns, during the second quarter of 2013, CEMEX Colombia reached a settlement with the Colombian Tax Authority (Dirección de Impuestos). On August 26, 2013, CEMEX Colombia received the final resolution regarding the 2007 year-end tax return and on September 16, 2013, CEMEX Colombia received the final resolution regarding the 2008 year-end tax return. Investigations in the UK Regarding the Market Investigation (“MIR”) commenced on January 2012 by the United Kingdom Competition Commission (the “UK Commission”), on October 8, 2013, the UK Commission announced its provisional decision on remedies which should not require CEMEX to divest any of its assets in the UK. Other major participants in the MIR could be required to divest certain of their assets in the UK. Based on the provisional remedies, CEMEX currently does not expect any material adverse impact on our financial results or operations from the Finding and Remedies final report that is to be submitted by the UK Commission by January 17, 2014. Change in the Parent Company’s functional currency Considering the guidance under IFRS set forth by International Accounting Standard 21, The Effects of Changes in Foreign Exchange Rates (“IAS 21”), and based on changing circumstances on the net monetary position in foreign currencies of CEMEX, S.A.B. de C.V. (on a parent company only basis) resulting mainly from: a) a significant decrease in tax liabilities denominated in Mexican Pesos; b) a significant increase in its U.S. Dollar-denominated debt and other financial obligations; and c) the expected increase in U.S. Dollar-denominated intra-group administrative expenses associated with the externalization of major back office activities with IBM; effective as of January 1, 2013, CEMEX, S.A.B. de C.V., for purposes of its parent company only financial statements, was required to prospectively change its functional currency from the Mexican Peso to the U.S. Dollar, as the U.S. Dollar was determined to be the currency of CEMEX, S.A.B. de C.V.‘s primary economic environment. The aforementioned change has no effect on the functional currencies of CEMEX, S.A.B. de C.V.‘s subsidiaries, which continue to be the currency in the primary economic environment in which each subsidiary operates. Moreover, the reporting currency for the consolidated financial statements of CEMEX, S.A.B. de C.V. and its subsidiaries and the parent company only financial statements of CEMEX, S.A.B. de C.V. continues to be the Mexican Peso. The main effects in CEMEX, S.A.B. de C.V.‘s parent company only financial statements beginning on January 1, 2013, associated with the change in functional currency, as compared to prior years are: a) all transactions, revenues and expenses in any currency are recognized in U.S. Dollars at the exchange rates prevailing at their execution dates; b) monetary balances of CEMEX, S.A.B. de C.V. denominated in U.S. Dollars will not generate foreign currency fluctuations, while monetary balances in Mexican Pesos and other non-U.S. Dollar-denominated balances will now generate foreign currency fluctuations through CEMEX, S.A.B. de C.V.‘s statement of operations; and c) the conversion option embedded in CEMEX, S.A.B. de C.V.‘s Mandatory Convertible Notes denominated in Mexican Pesos will now be treated as a stand-alone derivative instrument through CEMEX, S.A.B. de C.V.‘s statement of operations, while the options embedded in CEMEX, S.A.B. de C.V.‘s U.S. Dollar-Denominated 2010 Optional Convertible Subordinated Notes and 2011 Optional Convertible Subordinated Notes will cease to be treated as stand-alone derivatives through CEMEX, S.A.B. de C.V.‘s statement of operations. Prior period financial statements are not required to be restated. Significant tax proceedings In connection with the previously publicly disclosed tax proceeding related to the taxes payable in Mexico from passive income generated by foreign investments for the years 2005 and 2006 and the transitory amnesty provision, CEMEX, S.A.B. opted to enter this amnesty program and therefore there are not any tax liabilities in connection to this matter as of March 31, 2013. Mexican Tax Reform 2010 In November 2009, the Mexican Congress approved amendments to the income tax law that became effective on January 1, 2010. The new law included changes to the tax consolidation regime that require CEMEX to, among other things, determine income taxes as if the tax consolidation provisions in Mexico did not exist from 1999 onward. These changes also required the payment of taxes on dividends between entities of the consolidated tax group (specifically, dividends paid from profits that were not taxed in the past), certain special items in the tax consolidation, as well as tax loss carryforwards generated by entities within the consolidated tax group that should have been recovered by such individual entities over the succeeding 10 years. These amendments increased the statutory income tax rate from 28% to 30% for the years 2010 to 2012, 29% for 2013, and decreased it to 28% for 2014 and future years. Pursuant to these amendments, the parent company was required to pay in 2010 (at the 30% tax rate) 25% of the tax resulting from eliminating the tax consolidation effects from 1999 to 2004, and to pay an additional 25% in 2011. The remaining 50% is required to be paid as follows: 20% in 2012, 15% in 2013, and 15% in 2014. With respect to the consolidation effects originated after 2004, these should be considered during the sixth fiscal year following their origination and are be payable over the succeeding five years in the same proportions (25%, 25%, 20%, 15%, and 15%), and, in relation to this, the consolidation effect for 2005 has already been notified to CEMEX and considered. Applicable taxes payable as a result of the changes to the tax consolidation regime will be increased by inflation, as required by the Mexican income tax law. As of December 31, 2009, based on Interpretation 18, the parent company recognized the nominal value of estimated taxes payable in connection with these amendments of approximately US$799 million. This amount was recognized by the parent company as a tax payable on its balance sheet against “Other non-current assets” for approximately US$628 million, in connection with the net liability recognized before the new tax law and that the parent company expects to realize in connection with the payment of this tax liability; and approximately US$171 million against “Retained earnings” for the portion, according to the new law, related to: a) the difference between the sum of the equity of the controlled entities for tax purposes and the equity for tax purposes of the consolidated entity; b) dividends from the controlled entities for tax purposes to CEMEX, S.A.B. de C.V.; and c) other transactions between the companies included in the tax consolidation that represented the transfer of resources within the group. In December 2010, pursuant to additional rules, the tax authorities eliminated certain aspects of the law related to the taxable amount for the difference between the sum of the equity of the controlled entities for tax purposes and the equity for tax purposes of the consolidated entity. As a result, the parent company reduced its estimated tax payable by approximately US$235 million against a credit to “Retained earnings.” In 2012, changes in the parent company’s tax payable associated with the tax consolidation in Mexico are as follows (approximate US$ Millions): 2012 Balance at the beginning of the period $966 Income tax received from subsidiaries $162 Restatement for the period $58 Payments during the period ($54) Balance at the end of the period $1,132 In December 2012, the Federal Revenue Law (Ley Federal de Ingresos) applicable in 2013, established that the statutory income tax rate remained at 30% in 2013, then lowered it to 29% for 2014 and 28% for 2015 and future years. As of December 31, 2012, the balance of tax loss carryforwards that have not been considered in the tax consolidation was approximately US$549 million. As of December 31, 2012, the estimated payment schedule of taxes payable resulting from these changes in the tax consolidation regime in Mexico were as follows (approximate amounts in millions of US dollars): 2013 $157* 2014 $200 2015 $209 2016 $173 2017 $176 2018 and thereafter $217 1,132 * This payment was made in March 2013. 2013 Third Quarter Results Page 17
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DEFINITIONS OF TERMS AND DISCLOSURES Methodology for translation, consolidation, and presentation of results Under IFRS, beginning January 1, 2008, CEMEX translates the financial statements of foreign subsidiaries using exchange rates at the reporting date for the balance sheet and the exchange rates at the end of each month for the income statement. CEMEX reports its consolidated results in Mexican pesos. For the reader’s convenience, beginning June 30, 2008, US dollar amounts for the consolidated entity are calculated by converting the nominal Mexican peso amounts at the end of each quarter using the average MXN/US$ exchange rate for each quarter. The exchange rates used to convert results for the third quarter of 2013 and the third quarter of 2012 are 13.08 and 13.14 Mexican pesos per US dollar, respectively. Per-country/region figures are presented in US dollars for the reader’s convenience. Figures presented in US dollars for Mexico, as of September 30, 2013, and September 30, 2012, can be converted into their original local currency amount by multiplying the US-dollar figure by the corresponding average exchange rates for 2013 and 2012, provided below. Breakdown of regions Northern Europe includes operations in Austria, the Czech Republic, France, Germany, Hungary, Ireland, Latvia, Poland, and the United Kingdom, as well as trading operations in several Nordic countries. The Mediterranean region includes operations in Croatia, Egypt, Israel, Spain, and the United Arab Emirates. The South, Central America and the Caribbean region includes CEMEX’s operations in Argentina, Bahamas, Brazil, Colombia, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Haiti, Jamaica, Nicaragua, Panama, Peru, and Puerto Rico, as well as trading operations in the Caribbean region. The Asia region includes operations in Bangladesh, China, Malaysia, the Philippines, Taiwan, and Thailand. Definition of terms Free cash flow equals operating EBITDA minus net interest expense, maintenance and strategic capital expenditures, change in working capital, taxes paid, and other cash items (net other expenses less proceeds from the disposal of obsolete and/or substantially depleted operating fixed assets that are no longer in operation and coupon payments on our perpetual notes). Maintenance capital expenditures investments incurred for the purpose of ensuring the company’s operational continuity. These include capital expenditures on projects required to replace obsolete assets or maintain current operational levels, and mandatory capital expenditures, which are projects required to comply with governmental regulations or company policies. Net debt equals total debt (debt plus convertible bonds and financial leases) minus cash and cash equivalents. Operating EBITDA equals operating earnings before other expenses, net, plus depreciation and operating amortization. pp equals percentage points Strategic capital expenditures investments incurred with the purpose of increasing the company’s profitability. These include capital expenditures on projects designed to increase profitability by expanding capacity, and margin improvement capital expenditures, which are projects designed to increase profitability by reducing costs. Working capital equals operating accounts receivable (including other current assets received as payment in kind) plus historical inventories minus operating payables. Prices unless the context indicates otherwise, all references to pricing initiatives, price increases or decreases, refer to our prices for our products. Earnings per ADS The number of average ADSs outstanding used for the calculation of earnings per ADS was 1,170.5 million for the third quarter of 2013; 1,168.7 million for year-to-date 2013; 1,161.1 million for the third quarter of 2012; and 1,158.4 million for year to date 2012. According to the IAS 33 Earnings per share, the weighted-average number of common shares outstanding is determined considering the number of days during the accounting period in which the shares have been outstanding, including shares derived from corporate events that have modified the stockholder’s equity structure during the period, such as increases in the number of shares by a public offering and the distribution of shares from stock dividends or recapitalizations of retained earnings and the potential diluted shares (Stock options, Restricted Stock Options and Mandatory Convertible Shares). The shares issued as a result of share dividends, recapitalizations and potential diluted shares are considered as issued at the beginning of the period. Exchange rates January—September Third Quarter 2013 2012 2013 2012 Average Average Average Average Mexican peso 12.78 13.21 13.08 13.14 Euro 0.7582 0.7778 0.7495 0.7979 British pound 0.6476 0.6307 0.6396 0.6297 Amounts provided in units of local currency per US dollar. 2013 Third Quarter Results Page 18
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2013
Third Quarter Results
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2
Forward looking information
This presentation contains certain forward-looking statements and information relating to CEMEX, S.A.B. de C.V. and its subsidiaries (collectively, “CEMEX”) that are based on its knowledge of present facts, expectations and projections, circumstances and assumptions about future events. Many factors could cause the actual results, performance or achievements of CEMEX to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic, political, governmental, and business conditions globally and in the countries in which CEMEX operates, CEMEX’s ability to comply with the terms and obligations of the facilities agreement entered intowith major creditors and other debt agreements, CEMEX’s ability to achieve anticipated cost savings, changes in interest rates, changes in inflation rates, changes in exchange rates, the cyclical activity of the construction sector generally, changes in cement demand and prices, CEMEX’s ability to benefit from government economic stimulus plans, changes in raw material and energy prices, changes in business strategy, changes in the prevailing regulatory framework, natural disasters and other unforeseen events and various other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected or targeted. Forward-looking statements are made as of the date hereof, and CEMEX does not intend, nor is it obligated, to update these forward-looking statements, whether as a result of new information, future events or otherwise.
UNLESS OTHERWISE NOTED, ALL FIGURES ARE PRESENTED IN DOLLARS, BASED ON INTERNATIONAL FINANCIAL REPORTING STANDARDS
Copyright CEMEX, S.A.B. de C.V. and its subsidiaries.
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3
January – September Third Quarter
l-t-l% l-t-l%
Millions of US dollars 2013 2012 % var 2013 2012 % var
var var
Net sales 11,353 11,274 1% 0% 4,022 3,899 3% 3%
Gross profit 3,491 3,308 6% 5% 1,298 1,201 8% 8%
Operating earnings before
1,160 1,017 14% 15% 467 410 14% 16%
other expenses, net
Operating EBITDA 2,001 2,008 (0%) 0% 747 735 2% 3%
Free cash flow after
(311) (57) (448%) 245 204 20%
maintenance capex
Continued year-over-year growth in quarterly operating EBITDA
Year-to-date operating EBITDA increased by 3%, adjusting
for the effect of the change in a
pension plan in the Northern Europe region during 1Q12, while operating EBITDA margin
expanded by 0.4pp
3Q13 results highlights
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9M13 vs. 9M12 3Q13 vs. 3Q12 3Q13 vs. 2Q13
Volume (l-t-l1 ) (2%) 0% (1%)
Domestic gray
Price (USD) 2% (0%) (2%)
cement
Price (l-t-l1 ) 2% 1% (1%)
Volume (l-t-l1 ) (1%) 1% 1%
Ready mix Price (USD) 5% 7% 1%
Price (l-t-l1 ) 4% 5% 1%
Volume (l-t-l1 ) 1% 0% 3%
Aggregates Price (USD) 4% 7% 1%
Price (l-t-l1 ) 3% 5% 0%
Increase in domestic gray cement volumes in our operations in the U.S., and the South, Central
America and the Caribbean, Mediterranean, Northern Europe and Asia regions, offset lower
volumes in Mexico
Consolidated prices of our three core products, on a like-to-like basis, increased year-over-year
Consolidated volumes and prices
1
Like-to-like volumes adjusted for investments/divestments and, in the case of prices, foreign-exchange fluctuations
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3Q13 achievements
Year-to date adjusted operating EBITDA increased by 3% and adjusted operating EBITDA margin expanded by 0.4pp
On track to achieve the targeted US$100 million in savings during 2H13 from our cost-reduction initiatives in Mexico and the Northern Europe region
Alternative fuel substitution rate in our cement operations reached 28% during 3Q13
Announcement of three transactions expected to strengthen our strategic footprint in Europe
Transactions include: 1) CEMEX’s acquisition of Holcim’s operations in Czech Republic, 2) CEMEX’s divestitures of its assets in Western Germany to Holcim, and 3) combination of operations of CEMEX and Holcim in Spain
Expected synergies to result in recurring improvement$USin operating EBITDA of about 20—30 million per year
Transactions subject to fulfillment of various conditions, such as confirmatory due diligence and all approvals from competition authorities
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Third Quarter 2013
Regional Highlights
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Mexico
Millions of
9M13 9M12 % var l-t-l % var 3Q13 3Q12 % var l-t-l % var
US dollars
Net Sales 2,402 2,545 (6%) (9%) 776 875 (11%) (12%)
Op. EBITDA 761 910 (16%) (19%) 248 313 (21%) (21%)
as % net sales 31.7% 35.8% (4.1pp) 31.9% 35.8% (3.9pp)
9M13 vs. 3Q13 vs. 3Q13 vs.
Volume
9M12 3Q12 2Q13
Cement (10%) (13%) (6%)
Ready mix (7%) (9%) 2%
Aggregates 2% (1%) 6%
9M13 vs. 3Q13 vs. 3Q13 vs.
Price (LC)
9M12 3Q12 2Q13
Cement (2%) (3%) (2%)
Ready mix 1% 2% (1%)
Aggregates 1% 3% 1%
Volumes affected by slower-than-expected levels of investment in infrastructure and housing
About 2 percentage points of the quarterly cement volume decline was due to adverse weather conditions
The industrial-and-commercial sector continued to have a positive performance during the quarter
Government has announced different initiatives to support activity in the formal residential and infrastructure sectors, including the Program to Accelerate Growth for US$2.1 billion dollars and reconstruction efforts
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United States
Millions of
9M13 9M12 % var l-t-l % var 3Q13 3Q12 % var l-t-l % var
US dollars
Net Sales 2,495 2,305 8% 8% 891 826 8% 8%
Op. EBITDA 178 30 496% 496% 78 27 189% 189%
as % net sales 7.1% 1.3% 5.8pp 8.8% 3.3% 5.5pp
9M13 vs. 3Q13 vs. 3Q13 vs.
Volume
9M12 3Q12 2Q13
Cement 4% 7% 2%
Ready mix 10% 8% 0%
Aggregates 6% (4%) (0%)
9M13 vs. 3Q13 vs. 3Q13 vs.
Price (LC)
9M12 3Q12 2Q13
Cement 3% 2% (1%)
Ready mix 6% 6% 2%
Aggregates 4% 10% 1%
Quarterly increase in sales and operating EBITDA reflects strong operating leverage
Sixth consecutive quarter of positive EBITDA generation
During the quarter the residential and industrial- and-commercial sectors remain the main drivers of demand
Year-over-year price increases for our three core products, and sequentially in ready-mix and aggregates
Alternative fuel utilization in the country year-to- date as of September reached 26%, 4pp higher than in the same period last year
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Northern Europe
Millions of
9M13 9M12 % var l-t-l % var 3Q13 3Q12 % var l-t-l % var
US dollars
Net Sales 3,012 3,086 (2%) (3%) 1,169 1,105 6% 2%
Op. EBITDA 253 324 (22%) (23%) 162 143 14% 9%
as % net sales 8.4% 10.5% (2.1pp) 13.9% 12.9% 1.0pp
9M13 vs. 3Q13 vs. 3Q13 vs.
Volume
9M12 3Q12 2Q13
Cement (4%) 2% 15%
Ready mix (5%) 1% 7%
Aggregates (1%) 3% 6%
1 9M13 vs. 3Q13 vs. 3Q13 vs.
Price (LC) 9M12 3Q12 2Q13
Cement 0% 1% (1%)
Ready mix 2% 2% (2%)
Aggregates 2% 2% (1%)
Quarterly increase in operating EBITDA and operating EBITDA margin resulted from higher volumes and prices, as well as cost-reduction efforts
Cement volume growth during the quarter in the UK, Germany, Scandinavia, Latvia and the Czech Republic
Cement prices year-to-date (from December 2012 to September 2013) increased in Germany, Poland, Scandinavia and Latvia, in local-currency terms
The residential sector continued to be the main driver of demand in Germany and UK supported by low mortgage rates and unemployment
1 Volume-weighted, local-currency average prices
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Mediterranean
Millions of
9M13 9M12 % var l-t-l % var 3Q13 3Q12 % var l-t-l % var
US dollars
Net Sales 1,122 1,103 2% 3% 375 342 9% 8%
Op. EBITDA 246 293 (16%) (11%) 78 99 (21%) (18%)
as % net sales 21.9% 26.5% (4.6pp) 20.8% 28.9% (8.1pp)
9M13 vs. 3Q13 vs. 3Q13 vs.
Volume
9M12 3Q12 2Q13
Cement (2%) 1% (9%)
Ready mix 6% 7% (9%)
Aggregates (4%) (8%) (11%)
1 9M13 vs. 3Q13 vs. 3Q13 vs.
Price (LC) 9M12 3Q12 2Q13
Cement 7% 10% (1%)
Ready mix 2% 2% 0%
Aggregates 5% 6% 5%
During the quarter, increase in cement volumes from our operations in Egypt and UAE more than offset the decline in Spain and Croatia
Growth in year-over-year ready-mix volumes in Israel and UAE
In Spain, continued government austerity measures have affected infrastructure spending, while the residential sector gradually absorbs its home inventories
In Egypt, the increase in domestic gray cement volumes on a year-over-year basis continues to be driven by informal sector
1 Volume-weighted, local-currency average prices
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South, Central America and the Caribbean
Millions of
9M13 9M12 % var l-t-l % var 3Q13 3Q12 % var l-t-l % var
US dollars
Net Sales 1,657 1,574 5% 9% 596 520 15% 20%
Op. EBITDA 610 544 12% 15% 210 177 19% 24%
as % net sales 36.8% 34.6% 2.2pp 35.3% 34.0% 1.3pp
9M13 vs. 3Q13 vs. 3Q13 vs.
Volume
9M12 3Q12 2Q13
Cement 2% 9% 0%
Ready mix 1% 12% 10%
Aggregates 5% 17% 11%
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9M13 vs. 3Q13 vs. 3Q13 vs. |
Price (LC) 9M12 3Q12 2Q13
Cement 3% 1% (0%)
Ready mix 8% 8% 0%
Aggregates 2% (2%) 0%
Regional operating EBITDA margin expansion due to higher pricing levels as well as initiatives to improve efficiency and reduce costs
In Colombia, positive performance during the quarter was mainly driven by the residential and the industrial-and-commercial sectors
In Panama, infrastructure was driven by projects including the Panama Canal and the Cinta Costera project
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Volume-weighted, local-currency average prices |
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Asia
Millions of
9M13 9M12 % var l-t-l % var 3Q13 3Q12 % var l-t-l % var
US dollars
Net Sales 444 403 10% 10% 139 133 5% 9%
Op. EBITDA 99 70 40% 40% 36 28 27% 32%
as % net sales 22.2% 17.4% 4.8pp 25.9% 21.3% 4.6pp
9M13 vs. 3Q13 vs. 3Q13 vs
Volume
9M12 3Q12 2Q13
Cement 6% 10% (8%)
Ready mix (8%) (23%) (34%)
Aggregates 52% 100% 6%
1 9M13 vs. 3Q13 vs. 3Q13 vs.
Price (LC) 9M12 3Q12 2Q13
Cement 8% 5% (0%)
Ready mix 5% 9% 6%
Aggregates 20% 32% 8%
Regional increases in operating EBITDA and operating EBITDA margin driven by higher volumes and prices
Increase in regional cement volumes during the quarter reflects positive performance in the Philippines
Sequential regional price increases in ready-mix and aggregates, in local-currency terms
Demand for building materials in the Philippines continued to be positively affected by sustained infrastructure spending as well as a favorable performance from the residential and industrial-and-commercial sectors
1 Volume-weighted, local-currency average prices
12
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3Q13 Results
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14
Operating EBITDA, cost of sales and SG&A
January – September Third Quarter
l-t-l l-t-l
Millions of US dollars 2013 2012 % var 2013 2012 % var
% var % var
Net sales 11,353 11,274 1% 0% 4,022 3,899 3% 3%
Operating EBITDA 2,001 2,008 (0%) 0% 747 735 2% 3%
as % net sales 17.6% 17.8% (0.2pp) 18.6% 18.8% (0.2pp)
Cost of sales 7,862 7,966 1% 2,724 2,698 (1%)
as % net sales 69.2% 70.7% 1.5pp 67.7% 69.2% 1.5pp
Operating expenses 2,332 2,291 (2%) 831 790 (5%)
as % net sales 20.5% 20.3% (0.2pp) 20.7% 20.3% (0.4pp)
Year-to-date operating EBITDA, on a like-to-like basis adjusting for the effect of the change in a pension fund in 1Q12, increased by 3%
Operating EBITDA margin expansion year to date of 0.4pp, on an adjusted basis, driven by higher prices in most of our regions, continued cost reduction efforts and a favorable operating-leverage effect in the U.S.
Decline in cost of sales as a percentage of net sales mainly due reduction in workforce related to our cost reduction initiatives
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Free cash flow
January – September Third Quarter
Millions of US dollars 2013 2012 % var 2013 2012 % var
Operating EBITDA 2,001 2,008 (0%) 747 735 2%
- Net Financial Expense 1,066 1,036 348 347
- Maintenance Capex 255 219 105 96
- Change in Working Cap 497 509 (34) 53
- Taxes Paid 440 298 35 48
- Other Cash Items (net) 55 3 48 (12)
Free Cash Flow after Maint.Capex (311) (57) (448%) 245 204 20%
- Strategic Capex 72 93 36 33
Free Cash Flow (382) (150) (155%) 209 171 22%
Year-to-date working capital days decreased to 29 days, from 30 days during the same period in 2012
15
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Other income statement items
Other expenses, net, of $ US107 million during the quarter mainly included impairment of fixed assets, severance payments as well as a loss in sale of fixed assets
Foreign-exchange gain of $ US21 million resulting primarily from the fluctuation of the Mexican peso versus the U.S. dollar
Gain on financial instruments of $ US42 million related mainly to CEMEX shares
16
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Third Quarter 2013
Debt Information
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Debt-related information
Continued liability management initiatives to lower interests expense, increase debt average life and reduce refinancing risk
In August, issuance of $ US1 billion of 6.5%, senior secured notes maturing in 2019
In October, issuance of $ US 1 billion of 7.25%, senior secured notes maturing in 2021 and $ US500 million of LIBOR + 475 bps, floating rate senior secured notes maturing in 2018
During the quarter, total debt plus perpetual securities increased by $ US182 million
Negative foreign exchange conversion effect of US $82 million
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Consolidated debt maturity profile
Total debt excluding perpetual notes1 as of September 30, 2013 US $ 16,655 million
New Facilities Agreement
Other bank / WC debt / Certificados 6,000 • Avg. life of debt: 4.5 years Bursátiles
Millions of Fixed Income
US dollars
5,000 4,889 Convertible Subordinated Notes2
4,000
3,000
2,708
2,534
2,000
1,718 1,512 1,464 1,184 1,000
393 161
0 70 21
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 ³ 2023
1 CEMEX has perpetual debentures totaling $ US475 million
2 Convertible Subordinated Notes include only the debt component of US $2,124 million. Total notional amount is about US $2,383 million
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Consolidated debt maturity profile – pro forma 1
Total debt excluding perpetual notes2 as of September 30, 2013 pro forma1 US $ 16,724 million
Millions of US dollars
6,000 • New Facilities Agreement
Avg. life of debt: 4.8 years
Avg. yield of notes issued Other bank / WC debt / Certificados 5,000 during Oct. 2013: 6.5% Bursátiles 4,592 Fixed Income Convertible Subordinated Notes3 4,000
3,208
3,000
2,534
2,000 1,512 1,462 1,184 898 1,021 1,000
81 161 70 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 ³2023
1 Gives pro forma effect to (i) the issuance on October 2, 2013 of US $1 billion of 7.25% senior secured notes due 2021 and US $500 million of floating rate (LIBOR plus 475bp) senior secured notes due 2018 and (ii) the intended use of proceeds thereof to retire (A) all $ US825 million of the 9.5% senior secured notes due 2016 that were outstanding as of September 30, 2013, (B) €220 million of the €350 million of 9.625% senior secured notes due 2017 that were outstanding as of September 30, 2013 and (C) all €247 million of the 4.75% notes due 2014 that were outstanding as of September 30, 2013
2 CEMEX has perpetual debentures totaling $ US475 million
3 Convertible Subordinated Notes include only the debt component of US $2,124 million. Total notional amount is about US $2,383 million
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Appendix
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Additional information on debt and perpetual notes
Currency denomination Interest rate
Mexican peso 2% Euro
13% Variable 30%
Fixed U.S. 70% dollar 85%
Third Quarter Second Quarter
Millions of US dollars 2013 2012 % Var. 2013
Total debt1 16,655 17,180 (3%) 16,476
Short-term 3% 1% 3%
Long-term 97% 99% 97%
Perpetual notes 475 471 1% 472
Cash and cash equivalents 895 785 14% 746
Net debt plus perpetual notes 16,235 16,866 (4%) 16,201
Consolidated Funded Debt2 / EBITDA3 5.56 5.54
Interest coverage3 4 2.08 2.06
1 Includes convertible notes and capital leases, in accordance with IFRS
2 Consolidated Funded Debt as of September 30, 2013 was US $14,495 million, in accordance with our contractual obligations under the Facilities Agreement
3 EBITDA calculated in accordance with IFRS
4 Interest expense in accordance with our contractual obligations under the Facilities Agreement
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9M13 volume and price summary:
Selected countries
Domestic gray cement Ready mix Aggregates
9M13 vs. 9M12 9M13 vs. 9M12 9M13 vs. 9M12
Prices Prices Prices Prices Prices Prices
Volumes Volumes Volumes
(USD) (LC) (USD) (LC) (USD) (LC)
Mexico (10%) 1% (2%) (7%) 4% 1% 2% 5% 1%
U.S. 4% 3% 3% 10% 6% 6% 6% 4% 4%
Germany 0% 2% (1%) (6%) 7% 4% (2%) 5% 2%
Poland (22%) 1% (1%) (11%) (4%) (6%) (16%) (10%) (12%)
France N/A N/A N/A (9%) 5% 2% 3% 5% 2%
UK 7% (5%) (3%) 4% (1%) 1% (2%) (1%) 2%
Spain (29%) 8% 5% (29%) (5%) (7%) (45%) (2%) (5%)
Egypt 7% (2%) 12% (12%) 1% 15% (16%) (2%) 12%
Colombia (1%) 2% 6% 9% 4% 9% 5% (3%) 1%
Panama 4% 1% 1% (1%) 10% 10% 6% 9% 9%
Costa Rica 4% 13% 12% (8%) 16% 16% (3%) (3%) (4%)
Philippines 9% 7% 6% N/A N/A N/A N/A N/A N/A
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3Q13 volume and price summary: Selected countries
Domestic gray cement Ready mix Aggregates
3Q13 vs. 3Q12 3Q13 vs. 3Q12 3Q13 vs. 3Q12
Prices Prices Prices Prices Prices Prices
Volumes Volumes Volumes
(USD) (LC) (USD) (LC) (USD) (LC)
Mexico (13%) (3%) (3%) (9%) 2% 2% (1%) 3% 3%
U.S. 7% 2% 2% 8% 6% 6% (4%) 10% 10%
Germany 6% 6% (1%) (3%) 12% 6% 1% 8% 1%
Poland (14%) 6% 2% (2%) (4%) (7%) 2% (5%) (9%)
France N/A N/A N/A (1%) 8% 1% 9% 10% 3%
UK 12% (4%) (3%) 8% (1%) 1% (0%) 1% 3%
Spain (23%) 14% 7% (18%) 2% (4%) (40%) 2% (5%)
Egypt 7% 1% 16% (25%) 3% 17% (23%) (11%) 2%
Colombia 8% (2%) 3% 15% 1% 7% 15% (6%) (1%)
Panama 7% 2% 2% 19% 16% 16% 13% 6% 6%
Costa Rica 10% 10% 11% 2% 17% 18% 7% (4%) (3%)
Philippines 15% (1%) 3% N/A N/A N/A N/A N/A N/A
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Definitions
9M13 / 9M12: results for the nine months of the years 2013 and 2012, respectively.
Cement: When providing cement volume variations, refers to domestic gray cement operations (starting in 2Q10, the base for reported cement volumes changed from total domestic cement including clinker to domestic gray cement).
LC: Local currency.
Like-to-like percentage variation (l-t-l % var): Percentage variations adjusted for investments/divestments and currency fluctuations.
Maintenance capital expenditures: investments incurred for the purpose of ensuring the company’s operational continuity. These include capital expenditures on projects required to replace obsolete assets or maintain current operational levels, and mandatory capital expenditures, which are projects required to comply with governmental regulations or company policies.
Operating EBITDA: Operating earnings before other expenses, net plus depreciation and operating amortization. pp: percentage points.
Strategic capital expenditures: investments incurred with the purpose of increasing the company’s profitability. These include capital expenditures on projects designed to increase profitability by expanding capacity, and margin improvement capital expenditures, which are projects designed to increase profitability by reducing costs.
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Contact information
Investor Relations
In the United States +1 877 7CX NYSE
In Mexico +52 81 8888 4292
ir@cemex.com
Stock Information
NYSE (ADS): CX
Mexican Stock Exchange: CEMEXCPO
Ratio of CEMEXCPO to CX:10 to 1
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