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Cemex LatAm Colombia 3Q 2020 EBITDA Improving Cemex LatAm Colombia 3Q 2020 EBITDA Improving Source: Cemex LatAm Holdings

Cemex LatAm Posts US$109 Million Net Loss for 3Q 2020, but Colombia EBITDA Improves

Published in Companies Written by  October 28 2020 font size decrease font size increase font size 0
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Colombia-based Cemex LatAm Holdings on October 28 posted a US$109 million net loss for third quarter (3Q) 2020, worse than the US$4 million net loss in 3Q 2019.

The company attributed the net loss to “non-monetary impairment of intangible assets and assets in disuse.”

Cemex LatAm produces cement, concrete and aggregates in Colombia, Panama, Costa Rica, Nicaragua, El Salvador and Guatemala.

Corporate-wide consolidated net sales for 3Q 2020 decreased 8% year-on-year, but earnings before interest, taxes, depreciation and amortization (EBITDA) increased 19%.

EBITDA margin in 3Q 2020 increased 5.5 percentage points, “mainly due to higher cement prices as well as lower costs and selling and administrative expenses, despite lower volumes,” according to the company.

“Our cost savings program reached US$39 million [in the latest quarter] and it is expected to reach US$46 million dollars in total for 2020. We reduced our net debt by US$48 million and our leverage by 0.4 times to 3.7 times, from June to September.”

Commenting on the results, Cemex LatAm general manager Jesús González stated: “Our operations functioned relatively normally during the third quarter in Colombia, Guatemala, Nicaragua and El Salvador, while [Covid-19] restrictions had an impact in Panama and to a lesser degree in Costa Rica.

“We continue to support our clients in some of the challenges they face due to Covid-19 through our ‘Cemex Te Acompaña’ program and our ‘Cemex Go’ digital platform. As a result of these actions, during the quarter we increased our Net-Promoter-Score by 19 points compared to the same period of the previous year.”

Colombia Results

EBITDA in Colombia rose 59% year-on-year, to US$28 million, while net sales increased 1% in comparable terms, reaching US$115 million, according to the company

Colombia cement sales volumes industry-wide “reached levels close to 2019 in 3Q 2020” while “our cement volumes increased 66% sequentially [from 2Q 2020] but decreased 6% compared to the same period last year, reflecting a new competitor and an impact from our price increases,” according to the company.

“Our quarterly cement prices were the highest since 2016; an increase of 2% sequentially and 8% compared to the same period last year."

In Colombia’s “fourth generation “ (4G) highway-construction sector, “4G projects continued apace. As of September, we have delivered, in cement and/or concrete, the equivalent of more than 420,000 cubic meters of concrete,” according to the company.

“In Bogotá, projects already awarded should start soon, including three hospitals, Transmilenio [bus rapid transit] extensions and a water treatment plant. The ‘Metro’ and the ‘Regiotram’ [rail mass-transit projects] should start cement consumption in 4Q 2021.

“For 2021, [Colombia’s national] investment budget for transportation is 36% higher compared to the previous year. In addition, cement consumption from 4G projects should peak and some 5G [next-generation highway] program projects could start,” according to Cemex LatAm.

In Colombia’s residential, industrial and commercial-construction sectors, “demand for cement in the self-construction sector recovered in June and this trend continued during 3Q 2020. Home sales recovered in 3Q 2020 increasing 2.8% compared to the same period last year,” according to the company.

“However, housing starts fell in the middle-double-digits. In the industrial and commercial sector, [Covid-19-caused] trends such as telecommuting, restricted travel and online shopping could reduce the demand for cement. However, it is encouraging that industrial and business confidence indices reached levels close to pre-pandemic levels in September,” the company added.

Elsewhere in Cemex LatAm markets, Panama sales dropped 64% year-on-year, while Costa Rica sales fell 12%. However, Nicaragua, El Salvador and Guatemala sales collectively rose 19% year-on-year, according to the company.

Read 460 times Last modified on Last modified on October 28 2020

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