Boston, MA 10/29/2013 (wallstreetpr) – Cemex SAB de CV (ADR) (NYSE:CX) had mixed news for its third quarter performance. The Mexico-based cement conglomerate reported a substantial increase in sales numbers in the US, triggering 4% increase in shares on its US browsers. However, its losses for the third quarter were much higher than expectations.
Cemex has been struggling recently, largely because of the worldwide slowdown in construction activities, worsened by some very expensive acquisitions. Lesser spending by the Mexican government on infrastructure development has meant poor sales leading to higher losses. Cemex losses by the end of third-quarter were $155million.
Overseas markets ring hope
As one of the major cement manufacturing companies, Cemex has a presence in most overseas markets, which are currently driving sales figures for the company.
The recent spate of activity in the residential segment within the US has led to increase in sales reports Cemex. Additionally, European market has shown significant upward movement in sale of Cemex products. Net sales for this region saw a 6% increase in earnings for the third quarter, this year, over previous year’s third quarter. In terms of earnings it was $1105 million in Q3 2012, while this year it stands at $1169. Besides, Mediterranean region too saw higher sales, improving by nearly 9% over last year. Asian sales too reflected 5% increase while; the markets that Cemex operates in South America and the Caribbean recorded 15% increase.
However, Cemex’s new proposal with German cement maker Holcim is under EU anti-trust regulatory investigations. On October 22, 2013, the European Union’s apex body is exploring the implications of the proposal- will Holcim’s and Cemex exchange of assets in Europe give Holcim unrivalled primacy in Germany? Will the lack of competition drive prices higher?
It is expected that European Commission will declare its decision by March 10, 2014.
