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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One)
|X| Annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934 (No fee required, effective October 7, 1996)
For the fiscal year ended December 30, 2005
-------------------------------------------
Or
|_| Transition report pursuant to Section 15(d) of the Securities
Exchange Act of 1934 (No fee required)
For the transition period from _________________ to _________________
Commission file number 1-14946
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A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
CEMEX, Inc. Savings Plan
c/o CEMEX, Inc.
840 Gessner Road
Suite 1400
Houston, Texas 77024
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
CEMEX,S.A. de C.V.
Av. Ricardo Margain Zozaya #325
Colonia Valle del Campestre
Garza Garcia, Nuevo Leon
Mexico 66265
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CEMEX, INC. SAVINGS PLAN
Financial Statements and
Supplemental Schedule
December 30, 2005 and 2004
(With Report of Independent Registered Public Accounting Firm)
CEMEX, INC. SAVINGS PLAN
Table of Contents
Page
----
Report of Independent Registered Public Accounting Firm 1
Financial Statements:
Statements of Net Assets Available for Benefits -
December 30, 2005 and 2004 2
Statement of Changes in Net Assets Available for Benefits -
Year Ended December 30, 2005 3
Notes to Financial Statements 4
Supplemental Schedule H, Line 4(i) - Schedule of Assets
(Held at End of Year) - December 30, 2005 10
The following schedules required by the Department of Labor's Rules and
Regulations are omitted because of the absence of conditions under which they
are required:
Schedule G, Part I - Schedule of Loans on Fixed Income Obligations in
Default or Classified as Uncollectible
Schedule G, Part II - Schedule of Leases in Default or Classified as
Uncollectible
Schedule G, Part III - Nonexempt Transactions
Schedule H, Line 4(a) - Delinquent Employee Contributions and
Loan Repayments
Schedule H, Line 4(i) - Schedule of Assets (Acquired and Disposed of Within
the Plan Year)
Schedule H, Line 4(j) - Schedule of Reportable Transactions
[Letterhead of Mir.Fox & Rodriguez, P.C.]
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
-------------------------------------------------------
Participants and Administrator of
CEMEX, Inc. Savings Plan:
We have audited the accompanying statements of net assets available for
benefits of the CEMEX, Inc. Savings Plan (the Plan) as of December 30, 2005 and
2004, and the related statement of changes in net assets available for benefits
for the year ended December 30, 2005. These financial statements are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. The Plan is not
required to have, nor were we engaged to perform, an audit of its internal
control over financial reporting. An audit includes consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Plan's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan as of
December 30, 2005 and 2004, and the changes in net assets available for
benefits for the year ended December 30, 2005, in conformity with accounting
principles generally accepted in the United States of America.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets
(held at end of year) is presented for the purpose of additional analysis and
is not a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. This supplemental schedule is the responsibility of the Plan's
management. The supplemental schedule has been subjected to the auditing
procedures applied in the audit of the 2005 basic financial statements and, in
our opinion, is fairly stated in all material respects in relation to the 2005
basic financial statements taken as a whole.
/s/ Mir.Fox & Rodriguez, P.C.
Houston, Texas
June 27, 2006
1
CEMEX, INC. SAVINGS PLAN
Statements of Net Assets Available for Benefits
December 30, 2005 and 2004
Assets 2005 2004
------ ---- ----
Investments, at fair value:
Plan interest in CEMEX, Inc. Savings Plan Trust $ 288,507,723
Mutual funds 163,082,106
Common collective trust fund 48,016,215
Common stock 32,396,906
Participant loans 13,775,403 13,473,467
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Total investments 256,968,694 256,968,694
Cash and cash equivalents 95,483 94,877
Employee contributions receivable 369,996 3,142
Employer contributions receivable 193,320 1,619
Accounts receivable 336,104 41,968
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Total assets 303,278,029 257,110,300
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Liabilities
-----------
Investment trades payable 207,896 12,887
Accounts payable 87,323 8,661
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Total liabilities 295,219 21,548
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Net assets available for benefits $ 302,982,810 257,088,752
==================================
See accompanying notes to financial statements.
2
CEMEX, INC. SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits
Year Ended December 30, 2005
Additions to net assets:
Participant contributions $ 16,859,650
Employer contributions 8,812,659
Income from Plan interest in CEMEX, Inc. Savings Plan Trust 19,033,146
Net appreciation in fair value of common stock 12,472,598
Net appreciation in fair value of mutual funds 8,104,172
Investment and dividend income 3,013,214
Transfer in from qualified plan 3,579,154
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Total additions to net assets 71,874,593
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Deductions from net assets:
Benefits paid to participants 25,872,039
Administrative fees and expenses 108,496
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Total deductions from net assets 25,980,535
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45,894,058
Net increase in net assets available for benefits
Net assets available for benefits:
Beginning of year 257,088,752
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End of year $ 302,982,810
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See accompanying notes to financial statements.
3
CEMEX, INC. SAVINGS PLAN
Notes to Financial Statements
December 30, 2005 and 2004
1. Plan Description
General
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The Cemex USA Management, Inc. Savings Plan was adopted effective April 1,
1991 for the benefit of the employees of Cemex Management, Inc. (formerly
known as Cemex USA Management, Inc.) and its affiliated companies.
Effective January 1, 2001, CEMEX, Inc. (Sponsor) assumed sponsorship of
the Cemex USA Management, Inc. Savings Plan and changed the plan's name to
CEMEX, Inc. Savings Plan (the Plan). The Plan is intended to qualify under
section 401(a) of the Internal Revenue Code (IRC) as a profit sharing plan
with a 401(k) feature. The Plan is subject to the provisions of the
Employee Retirement Income Security Act of 1974 (ERISA), as amended.
The Plan Agreement was completely amended and restated effective January
1, 2005. The following brief description of the Plan is provided for
general information purposes only and is as of December 30, 2005, unless
otherwise noted. The capitalized words and phrases used in the following
subsections of this note, shall have the meanings as set forth in the Plan
Agreement and are as of December 30, 2005 unless otherwise noted.
Participants should refer to the amended and restated Plan Agreement for a
complete description of the Plan's provisions.
Eligibility
-----------
Except as otherwise noted, Employees of CEMEX, Inc. and its affiliated
companies (collectively, Employer) that have adopted the Plan are eligible
to participate in the Plan on the first day of the calendar quarter
following the Employee's date of hire. All Employees who are covered by a
collective bargaining agreement shall be excluded from participating in
the Plan, unless the collective bargaining agreement requires that the
Employer include such Employees in this Plan. Any Employee who is notified
that he is eligible to participate in a foreign retirement plan maintained
by CEMEX, Inc. or any company in any country operating under the parent
company of CEMEX, S.A. de C.V. shall be ineligible to participate in this
Plan as of the first day of the month following the month he or she is
notified of his or her eligibility to participate in such foreign
retirement plan, and shall remain ineligible until the first day of the
month following the month he or she is notified that he or she is no
longer eligible to participate in such foreign retirement plan. Any
employee who is a nonresident alien with no United States source income,
working outside the United States, is a leased employees, or an individual
contractor, shall be excluded from participating in the Plan.
Effective April 1, 2005, the union employees of the Clinchfield, Georgia
plant ceased participating in the CEMEX, Inc. Savings and Investment Plan
for Union Employees and became participants in the Plan. In connection
therewith, assets of $3,579,154 were transferred into the Plan from the
CEMEX, Inc. Savings and Investment Plan for Union Employees during fiscal
year 2005.
Contributions
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Employees may make voluntary contributions of up to 40% of eligible
compensation on a before-tax basis and an additional 18% of eligible
compensation on an after-tax basis. Participants who are or will attain
age 50 years old or older before the close of the Plan's year, are
eligible to make a catch-up contribution in accordance with section 414(v)
of the IRC. Participants may also contribute amounts representing
distributions from other qualified defined benefit or contribution plans.
Participants direct the investment of their participant contributions into
various investment options offered by the Plan.
Continued
4
CEMEX, INC. SAVINGS PLAN
Notes to Financial Statements, Continued
The Employer makes matching contributions equal to 75% of the
participant's before-tax contributions, which do not exceed 6% of his or
her eligible compensation. The Employer contributions are in the form of
American Depository Shares representing common stock of CEMEX, S.A. de
C.V. (CEMEX stock). A participant may, at any time after the CEMEX stock
is credited to his or her account, make a diversification election and
exercise investment discretion with respect to the Employer matching
contribution.
Participant accounts
--------------------
Separate accounts are maintained for each participant. Participant
accounts are credited with the participant's contribution and allocations
of the Employer's contributions and Plan earnings. Allocations are based
on each participant's earnings or account balance, as defined in the Plan
Agreement. Each participant is entitled to the benefit that can be
provided from the participant's vested account.
Vesting
-------
Participants are immediately vested in their employee and rollover
contributions plus actual earnings thereon. Vesting in the Employers'
matching and discretionary minimum contribution portion of their accounts
plus earnings thereon is based on years of Active Service, among other
things, and is further defined in the Plan Agreement. The maximum years of
Active Service required for 100% vesting is five years.
Forfeitures
-----------
Forfeited amounts are first used to restore forfeited amounts for
participants who have previously terminated but qualify for restoration
under the terms of the Plan Agreement. If any amount remains after that
allocation, it may be used to reduce the Employer matching contribution
for that year. At December 30, 2005 and 2004, forfeited non-vested
accounts totaled $535,001 and $50,319, respectively. During fiscal year
2005, Employer contributions were reduced by $3,053 from forfeited
non-vested accounts.
Benefit payments
----------------
Benefits are payable from participant account balances, subject to certain
restrictions, upon termination of employment, retirement, reaching the age
of 59 1/2, or by incurring a death, disability or financial hardship, as
defined in the Plan Agreement. Participants elect the method of
distribution which may be either in the form of a direct rollover to an
eligible retirement plan, lump sum payment or, if in excess of $5,000,
payment over a period of time not to exceed the shorter of 10 years or
certain life expectancies as defined in the Plan Agreement. Participants
may elect that their portion of account balances invested in full shares
of CEMEX stock or Crane Company common stock be distributed in-kind.
Unless timely election was made, effective March 28, 2005, participants
with a vested account balance less than or equal to $1,000 will
automatically receive a lump sum cash distribution and participants with a
vested account balance less than or equal to $5,000 but larger than $1,000
will automatically receive a direct rollover to an IRA designated by the
Benefit Committee.
Continued
5
CEMEX, INC. SAVINGS PLAN
Notes to Financial Statements, Continued
Participant loans
-----------------
A participant may obtain a loan from his or her separate account balance.
Each loan is evidenced by a promissory note and may not be less than
$1,000. The loans are secured by the balance in the participant's account
and bear interest at a rate commensurate with commercial prevailing rates
as determined by the Administrator. Provisions of the Plan require the
aggregate of each loan outstanding not to exceed the lesser of $50,000 or
50% of the participant's vested account balance. Repayment terms for loans
are not to exceed five years and principal and interest is paid ratably
through monthly payroll deductions. A participant may only have two loans
outstanding at the same time.
Plan termination
----------------
Although no interest has been expressed, the Sponsor has the right under
the Plan to terminate the Plan subject to the provisions of ERISA. In the
event of Plan termination, participants become 100% vested in their
Employer contributions account. Participant contributions are always 100%
vested.
2. Significant Accounting Policies
Basis of presentation
---------------------
The financial statements have been prepared on an accrual basis and
present the net assets available for plan benefits and changes in those
net assets in accordance with accounting principles generally accepted in
the United States of America.
Investment valuation and income recognition
-------------------------------------------
The fair value of the Plan's interest in the CEMEX, Inc. Savings Plan
Trust (Master Trust) is based on the beginning of period value of the
Plan's interest in the Master Trust plus actual contributions and
allocated investment income less actual distributions and allocated
administrative expenses. Quoted market prices are used to value
investments in the Master Trust. The mutual funds, common collective trust
fund and common stock are stated at fair value based on quoted market
prices as of the date of the financial statements. Participant loans are
valued at their outstanding balances, which approximate fair value.
Purchases and sales of securities are recorded on a trade-date basis.
Interest income is recorded on the accrual basis. Dividends are recorded
on the ex-dividend date.
Benefit payments
----------------
Benefits are recorded when paid.
Administrative expenses
-----------------------
Loan fees are paid by the borrowing participant and all other
administrative costs not paid for by the Plan are paid by the Employer.
Continued
6
CEMEX, INC. SAVINGS PLAN
Notes to Financial Statements, Continued
Use of estimates
----------------
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported
amounts of assets, liabilities, and changes therein, and disclosure of
contingent assets and liabilities. Accordingly, actual results could
differ from those estimates.
3. Interest in CEMEX, Inc. Savings Plan Trust
The Plan's investments, with the exception of the participant loans, are
in a Master Trust which was established on August 1, 2005 for the
investment of assets of the Plan and other Employer sponsored retirement
plans. Each participating retirement plan has an undivided interest in the
Master Trust. The assets of the Master Trust are held by Nationwide Trust
Company (trustee). At December 30, 2005, the Plan's interest in the net
assets of the Master Trust was approximately 99%. Investment income and
administrative expenses relating to the Master Trust are allocated to the
individual plans based upon average monthly balances invested by each
plan.
The following table presents the fair value of investments for the Master
Trust as of December 30, 2005:
CEMEX stock $ 63,106,592
INVESCO Stable Value Fund 53,030,857
Washington Mutual Investors Fund 40,521,509
Growth Fund of America 36,123,503
PIMCO Total Return Fund 30,873,107
Templeton Foreign Fund 20,676,355
Franklin Balance Sheet Investment Fund 16,902,250
American Century Real Estate Fund 12,050,274
MFS International Fund 7,859,768
Franklin Small Mid-Cap Growth Fund 5,311,639
Templeton Developing Markets Fund 5,299,376
Crane Company common stock 121,596
Federated Capital Reserve Account 70,803
Cash Management Trust of America 33
---------------
$ 291,947,662
Investment income for the Plan's holdings in the Master Trust is as
follows for the period August 1, 2005 through December 30, 2005:
Net appreciation in fair value of common stock $ 12,409,518
Net depreciation in fair value of mutual funds (592,640)
Interest and dividend income 7,216,268
---------------
$ 19,033,146
===============
Continued
7
CEMEX, INC. SAVINGS PLAN
Notes to Financial Statements, Continued
4. Investments
The following investments represent 5% or more of the Plan's net assets as
of December 30:
2005 2004
---- ----
Interest in CEMEX, Inc. Savings Plan Trust $ 288,507,723
INVESCO Stable Value Fund 48,016,215
Washington Mutual Investors Fund 40,014,396
CEMEX stock 32,222,967
Growth Fund of America 32,089,559
PIMCO Total Return Fund 29,271,416
Templeton Foreign Fund 19,131,801
Franklin Balance Sheet Investment Fund 16,733,261
5. Federal Income Tax Status
The Plan obtained its latest determination letter on November 20, 2002 in
which the Internal Revenue Service stated that the Plan, as then designed,
was in compliance with the applicable requirements of the IRC. The Plan
has been amended since receiving the determination letter. However, the
Plan's management believes that the Plan is designed and is currently
being operated in compliance with the applicable requirements of the IRC.
Therefore, the Plan's management believes that the related trust is
tax-exempt and accordingly, no provision for Federal income taxes has been
included in the Plan's financial statements.
6. Risks and Uncertainties
The Plan provides for investment in a various investment securities.
Investment securities, in general, are exposed to various risks, such as
interest rate, credit and overall market volatility risks. Due to the
level of risk associated with certain investment securities, it is at
least reasonably possible that changes in the values of investment
securities will occur in the near term and that such changes could
materially affect participants' account balances and the amounts reported
in the statements of net assets available for benefits.
7. Subsequent Events
The Plan year end has been changed to December 31. Effective December 31,
2005, the following qualified plans were merged into the Plan:
o Savings & Retirement Plan for Employees of RMC USA, Inc. &
Affiliated Companies
o RMC Pacific Materials Incorporated Savings Plan for Salaried
Employees
o CEMEX El Paso, Inc. 401(k) Plan
o Nor-Cal Readymix, Inc. 401(k) Plan
o CEMEX, Inc. Savings and Investment Plan for Bargaining Employees
o NeorisLogistics 401(k) Plan
In connection with these mergers, assets of approximately $97 million were
transferred into the Plan subsequent to December 30, 2005. Additionally,
effective January 1, 2006, the Plan was adopted by CEMEX Southeast LLC.
Continued
8
CEMEX, INC. SAVINGS PLAN
Notes to Financial Statements, Continued
8. Reconciliation of Financial Statements to Form 5500
The following is a reconciliation of net assets available for benefits per
the financial statements to the Form 5500:
2005 2004
---- ----
Net assets available for benefits per the
financial statements $ 302,982,810 257,088,752
Benefits payable (257,431) (9,784)
---------------- -------------
Net assets available for benefits per the
Form 5500 $ 302,725,379 257,078,968
================ =============
The following is a reconciliation of benefits paid to participants per the
2005 financial statements to the Form 5500:
Benefits paid to participants per the
financial statements $ 25,872,039
Less: Deemed distributions (24,310)
Add: Amounts payable at December 30, 2005 257,431
Less: Amounts payable at December 30, 2004 (9,784)
--------------
Benefits paid to participants per the Form 5500 $ 26,095,376
==============
9
Supplemental Schedule H, Line 4(i)
Plan Sponsor No. 72-0296500
Plan No. 001
CEMEX, INC. SAVINGS PLAN
Schedule of Assets (Held at End of Year)
December 30, 2005
(a) (b) (c) (e)
Identity of issue, borrower, Description of investment including maturity date, Current
lessor, or similar party rate of interest, collateral, par or maturity value value
------------------------------------------ ---------------------------------------------------- -----------------
* Plan interest in CEMEX, Inc. Savings Plan Trust Master trust $ 288,507,723
* Participant loans 4.00% to 11.50%; 1-5 year term; payable monthly 13,775,403
---------------
$ 302,283,126
===============
* Party-in-interest
10
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on its behalf by the undersigned,
thereunto duly authorized.
CEMEX, INC. SAVINGS PLAN
By: /s/ Andrew M. Miller
-------------------------------
Name: Andrew M. Miller
Title: Chairman of Administrative
Committee
Date: June 27, 2006
---------------------
EXHIBIT INDEX
Exhibit
No. Description
- -------- -----------
1. Consent of Mir.Fox & Rodriguez, P.C. to the
incorporation by reference into the Registration
Statement on Form S-8 (File No. 333-83962) of CEMEX,
S.A. de C.V. of its report, dated June 27, 2006,
with respect to the audited financial statements of
the CEMEX, Inc. Savings Plan as of December 30,
2005.
EXHIBIT 1
[Letterhead of Mir.Fox & Rodriguez, P.C.]
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
--------------------------------------------------------
We consent to the incorporation by reference in the Registration Statement on
Form S-8 (No. 333-83962) of CEMEX, S.A. de C.V. of our report dated June 27,
2006, with respect to the statements of net assets available for benefits of
CEMEX, Inc. Savings Plan as of December 30, 2005 and 2004, the related
statement of changes in net assets available for benefits for the year ended
December 30, 2005 and the related supplemental schedule of assets (held at end
of year) as of December 30, 2005, which report appears in the December 30, 2005
annual report on Form 11-K of CEMEX, Inc. Savings Plan.
/s/ Mir.Fox & Rodriguez, P.C.
Houston, Texas
June 27, 2006