Cemex announced that, on a like-to-like basis for its ongoing operations and adjusting for currency fluctuations, consolidated net sales increased by 6 percent during the first quarter of 2017 to $3.1 billion versus the comparable period in 2016. Operating EBITDA on a like-to-like basis increased by 2 percent during the quarter to $559 million versus the same period in 2016.
The increase in quarterly consolidated net sales was due to higher prices of its products, in local currency terms, in most of its operations, as well as higher volumes in Mexico, Europe, South and Central America, and the Caribbean regions.
Operating earnings before other expenses, net, in the first quarter increased on a like-to-like basis by 3 percent, to $351 million.
Controlling interest net income during the quarter improved to $336 million, from an income of $35 million in the same period last year. Operating EBITDA on a like-to-like basis increased by 2 percent during the quarter and compared to the same period in 2016, to $559 million. Operating EBITDA margin decreased by 0.5 percentage points on a year-over-year basis reaching 17.8 percent.
Free cash flow after maintenance capital expenditures for the quarter was negative $153 million, compared with $8 million in the same quarter of 2016.
During the first quarter of 2017, controlling interest net income was a gain of $336 million, an improvement over a gain of $35 million in the same period last year.
Total debt plus perpetual notes decreased by $470 million, or nearly 4 percent, during the quarter.
Net sales in its operations in Mexico increased 28 percent on a like-to-like basis in the first quarter of 2017 to $725 million. Operating EBITDA increased by 31 percent on a like-to-like basis to $267 million versus the same period of last year.
Cemex’s operations in the United States reported net sales of $834 million in the first quarter of 2017, up 2 percent on a like-to-like basis from the same period in 2016. Operating EBITDA increased by 32 percent on a like-to-like basis to $118 million in the quarter.
Cemex’s operations in South and Central America, and the Caribbean reported net sales of $480 million during the first quarter of 2017, representing a decrease of 1 percent on a like-to-like basis over the same period of 2016. Operating EBITDA decreased 15 percent on a like-to-like basis to $133 million in the first quarter of 2017.
Fernando A. Gonzalez, chief executive officer, said, “We continued to see favorable results from our value-before-volume strategy during the quarter. Sequential and year-over-year pricing increased in the low- to mid-single digits for our three core products. This, together with favorable volume dynamics in Mexico and our Europe and South, Central America and Caribbean regions led to solid growth in consolidated sales and operating EBITDA, on a like-to-like basis. In addition, net income increased close to a tenfold during the quarter.
“During the quarter, we reduced our total debt by $470 million,” he continued. “This debt level is more than $2.7 billion lower than that at the end of 2015, representing a reduction of close to 18 percent. We have about $230 million of announced asset sales pending to close. This, plus free cash flow generation during the rest of the year should help us continue to de-lever, reach our debt reduction target for this year, and bring us closer to an investment-grade capital structure.”