PRESS RELEASE

CEMEX's net income grows 72% during the first nine months of 2017

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Thursday, October 26, 2017

Press Release by

Cemex

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MONTERREY, Mexico- CEMEX, S.A.B. de C.V. ("CEMEX") (NYSE:CX), announced today that consolidated net sales reached U.S.$3.5 billion during the third quarter of 2017, representing an increase of 2%, or an increase of 1% on a like-to-like basis for the ongoing operations and adjusting for currency fluctuations, versus the comparable period in 2016. Operating EBITDA decreased by 8% during the quarter to U.S.$702 million versus the same period in 2016.

CEMEX's Consolidated Third-Quarter 2017 Financial and Operational Highlights

  • The increase in consolidated net sales on a like-to-like basis was due to higher prices for our products in Mexico and the U.S., as well as higher cement volumes in the U.S., Europe, and Asia Middle East and Africa regions.
  • Operating earnings before other expenses, net, in the third quarter decreased by 9%, to U.S.$494 million.
  • Controlling interest net income during the quarter improved to U.S.$289 million from an income of U.S.$286 million in the same period last year.
  • Operating EBITDA decreased during the quarter by 8% on a like-to-like basis to U.S.$702 million.
  • Operating EBITDA margin decreased by 2.2 percentage points on a year-over-year basis reaching 19.8%, reflecting in part higher energy and freight costs, increase costs in raw materials in some of our ready-mix operations, as well as the impact of lower volumes.
  • Free cash flow after maintenance capital expenditures for the quarter was U.S.$435 million, compared with U.S.$548 million in the same quarter of 2016. The conversion rate of EBITDA into free cash flow after maintenance capex during the quarter reached 62 percent.

Fernando A. Gonzalez, CEMEX Chief Executive Officer, said, "We are pleased with the double-digit, year-to-date growth in operating EBITDA in our two largest markets: Mexico and the U.S., which represent about two-thirds of our total EBITDA generation.

"In addition, our debt leverage during the quarter reached 3.98 times during the quarter. This is the first time that our leverage ratio falls below 4 times since the third quarter of 2008. This will continue contributing to further savings in our financial expenses.

"I'm particularly encouraged with our net income reaching US$916 million during the first nine months of 2017. This is the highest year-to-date net income in almost 10 years."

Consolidated Corporate Results

During the third quarter of 2017, controlling interest net income was U.S.$289 million, an improvement over U.S.$286 million in the same period last year.

Total debt plus perpetual notes decreased by U.S.$369 million during the quarter and by U.S.$1.5 billion during the first nine months of the year.

Geographical Markets Third-Quarter 2017 Highlights

Net sales in our operations in Mexico increased 1% on a like-to-like basis in the third quarter of 2017 to U.S.$782 million, compared with U.S.$732 million in the third quarter of 2016. Operating EBITDA increased by 7% on a like-to-like basis to U.S.$302 million versus the same period of last year.

CEMEX's operations in the United States reported net sales of U.S.$916 million in the third quarter of 2017, an increase of 2% on a like-to-like basis from the same period in 2016. Operating EBITDA increased 1% on a like-to-like basis to U.S.$160 million in the quarter.

CEMEX's operations in South, Central America and the Caribbean reported net sales of U.S.$472 million during the third quarter of 2017, representing a decrease of 6% on a like-to-like basis over the same period of 2016. Operating EBITDA decreased 28% on a like-to-like basis to U.S.$113 million in the third quarter of 2017, from U.S.$145 million in the third quarter of 2016.

In Europe, net sales for the third quarter of 2017 increased 2% on a like-to-like basis to U.S.$948 million, compared with U.S.$887 million in the third quarter of 2016. Operating EBITDA was U.S.$129 million for the quarter, 7% lower on a like-to-like basis than the same period last year.

Operations in Africa, Middle East and Asia reported a 1% increase in net sales on a like-to-like basis for the third quarter of 2017, to U.S.$346 million, versus the third quarter of 2016, and operating EBITDA for the quarter was U.S.$57 million, down 41% on a like-to-like basis 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. Celebrating its 110th anniversary, CEMEX has a rich history of improving the well-being of those it serves through innovative building solutions, efficiency advancements, and efforts to promote a sustainable future.

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