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CEMEX update guidance for 2010

AMONG the updated full-year 2010 guidance announced at CEMEX’s recent Investor and Analyst Conference, the company confirmed that expectations for key 2010 metrics, such as EBITDA, remain unchanged in local currency terms.

However, as a result of exchange rate fluctuations, primarily the decline of the euro and the Mexican peso relative to the US dollar since 27 April 2010, CEMEX now expect EBITDA for the full year 2010 to be approximately US$2.75 billion, while free cash flow after maintenance capital expenditures is expected to be approximately US$800 million (based on currently prevailing exchange rates).

CEMEX say they expect to use approximately US$450 million from their free cash flow to reduce debt.

In addition, because of the currency composition of CEMEX’s total debt, the US dollar’s appreciation in relation to other currencies, including the euro and the Mexican peso, has resulted in a favorable translation impact on the company’s total indebtedness.

At currently prevailing exchange rates, total indebtedness has declined by approximately US$550 million relative to the balance as of 31 March 2010, due to favourable conversion effects.

Moreover, CEMEX’s total indebtedness has been further reduced by approximately US$437 million during the current quarter, as a result of the recently completed exchange of the company’s outstanding perpetual debentures for US dollar-denominated and euro-denominated notes.

Overall, therefore, total debt, including outstanding perpetual debentures, has declined by nearly US$1 billion since 31 March 2010.

For the full year 2010, CEMEX say they continue to expect consolidated domestic cement volumes to increase by approximately 3%, ready-mixed concrete volumes to decline slightly, and aggregates volumes to increase by approximately 1%.

The company also continues to expect high single-digit growth in cement sales volumes in the US in 2010.

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