Cemex LatAm Posts 1Q 2023 Net Loss; Year-on-Year Decline Hits 122%
Colombia-based Cemex LatAm Holdings (CLH) announced May 2 that its first quarter (1Q) 2023 net income fell 122% year-on-year, from a positive US$16 million in 1Q 2022 to a net loss of US$1.05 million in 1Q 2023.
Net sales also dipped 2% year-on-year, to US$204.7 million, while operating earnings before interest, taxes, depreciation and amortization (EBITDA) fell 22% year-on-year, to US$28.5 million.
Excluding the impact of divesting its Costa Rica and El Salvador operations last year, consolidated net sales during 1Q 2023 “increased by 9% on a like-to-like basis” for its ongoing operations in Colombia, Panama and remaining Central American operations — once including foreign exchange fluctuations, according to the company.
“Cost of sales as a percentage of net sales increased by 4.7 percentage points, from 65.6% in 1Q 2022 to 70.3% in 1Q 2023. The increase was primarily due to higher operational costs, mainly in kiln fuel and maintenance costs,” according to CLH.
“Operating EBITDA during the first quarter of 2023 declined by 14% on a like-to-like basis, compared with that of 1Q 2022. The decline was mainly due to higher costs, partially offset by increased sales,” the company added.
“In Colombia, our domestic gray cement and ready-mix prices improved by 17% and 25%, respectively, during the quarter on a year-over-year basis. In January 2023 we announced a price increase in the mid-teen percentage area, applicable to all customer segments in our cement business, as part of our efforts to close the gap with the significant input-cost inflation we have experienced.
“In Panama, our volumes for domestic gray cement and ready-mix increased by 1% and 44%, respectively, during the first quarter on a year-over-year basis. Ready-mix volume growth was driven mainly by increased activity in the infrastructure sector, largely due to work related to the third line of the Metro.
“In the rest-of-CLH region, our domestic gray cement volumes declined by 1%, while our prices improved by 5% in local-currency terms during the first quarter, on a year-over-year basis.
“Net debt declined by 38%, or by US$229 million, from March 2022 to March 2023. The proceeds from the divestment of Costa Rica and El Salvador received during 3Q 2022 were mainly used to reduce debt,” the company added.
As for its year-2023 outlook, CLH sees cement sales as essentially flat in all its regions, with ready-mix volumes rising by “high single digits” in Colombia, by more than 20% in Panama and by “high single digits” in the rest of its Central America markets.