Cemex SAB de CV Cert Part Ord Repr 2 ShsA & 1 ShsB · BMV:CEMEX/CPO
Cemex SAB de CV Cert Part Ord Repr 2 ShsA & 1 ShsB — Cemex SAB DE CV — Investor Presentation (March 2019)
31 slides from Cemex SAB de CV Cert Part Ord Repr 2 ShsA & 1 ShsB's investor presentation, Mar 20, 2019
Slide 1: Fernando A. González, CEMEX CEO, Salesforce Tower
Fernando A. González CEMEX CEO Salesforce Tower, USA Exhibit 1
Slide 2: Forward-looking statements
CEMEX,SAB. de CV. and its or such as “may,” ‘should,’ ‘could, “anticipate, “estimate, “expect.” “plan,” “believe,” “predict,” “potential” and “intend” or other similar words. me of the risk: SAB, de C.V. with the U. ce compliance other CEMEX does not refer to CCEMEX's prices for CEMEX’s products. Co
Slide 3: 2018 was a year of solid achievements
2018 was a year of solid achievements 1) On a like-to-like basis 2) After maintenance CapEx 3) Including perpetuals Attained record Health & Safety results Launched A Stronger CEMEX to accelerate deleveraging and increase shareholder return Achieved top-line growth1 of 6% with higher volumes and pri
Slide 4: Resilient EBITDA generation despite headwinds
Resilient EBITDA generation despite headwinds… Var cost & distr. Fixed cost & other EBITDA variation ($ M) Volume +1% Price 18.9% EBITDA Margin 17.8% -1.1pp
Slide 5: Generating ~$1B in FCF in each of last years
…while generating ~$1B in FCF1 in each of last 3 years 1) After maintenance CapEx
Slide 6: Free Cash Flow ($ M)
399 881 1,685 1,290 918 2014 2015 2016 2017 2018 Free Cash Flow1 ($ M) reduction in annual net financial expense since 2013 ~$770 M 2018 FCF conversion2 36% Change in working capital FCF1 excluding change in working capital 1) After maintenance CapEx 2) Conversion of EBITDA into free cash flow after
Slide 7: Contributing to our success since 2013
Contributing to our success since 2013 Generated $5.2 B of Free Cash Flow1 Asset sales of ~$3.6 B at mid-teen multiples Unlocked $1.1 B in working capital investment Reduced $7.1B of Total Debt2 or ~40% decline Operating expenses3 as percentage of sales declined 1.3pp Improved operating efficiency b
Slide 8: Higher uncertainty and moderating global growth in 2019
Slowing global growth Shift toward dovish monetary policies Cautious business sentiment Higher market volatility Reduced energy headwinds Strong labor markets and resilient consumer confidence Positive outlook for infrastructure spending in most markets Higher uncertainty and moderating global growt
Slide 9: Balanced by key demand drivers
Slowing global growth Shift toward dovish monetary policies Cautious business sentiment Higher market volatility Reduced energy headwinds Strong labor markets and resilient consumer confidence Positive outlook for infrastructure spending in most markets Balanced by key demand drivers
Slide 10: We are constructive on 2019
We are constructive on 2019 Expecting consolidated volume growth across all products on back of stronger infrastructure spending in most markets Positive pricing outlook due to demand dynamics and need to recover input cost inflation $230 M of cost initiatives of which $170 M expected to be realized
Slide 11: And we expect markets to grow over next years
And we expect markets to grow over next 4 years Philippines Strong growth (>6%) Solid growth (4% to 6%) Moderate growth (2% to 4%) Limited growth (1% to 2%) Stagnation (<1%) R 2018 Pricing (LC) Demand growth (2019-2022) Egypt UAE Israel
Slide 12: A Stronger CEMEX keeps us on track toward investment grade
A Stronger CEMEX keeps us on track toward investment grade…
Slide 13: A Stronger CEMEX initiatives and targets
A Stronger CEMEX initiatives and targets refer to the July 2018 – December 2020 period. Accelerate Deleveraging Achieve <3x leverage & reduce Total Debt by $3.5 B by 2020 Return Capital to Shareholders $150 M dividends plus opportunistic share repurchases Growth and Capital Recycling Organic growth,
Slide 14: …and our medium-term financial targets
…and our medium-term financial targets
Slide 15: Financial targets
1) Consolidated funded debt/EBITDA 2) Conversion of EBITDA into free cash flow after maintenance CapEx 3) ROCE = Net Operating Profit After Tax/Net Assets Leverage ratio 1 ROCE 3 <3.0x FCF conversion 2 >50% EBITDA margin >10% >20% Financial targets
Slide 16: A superior customer experience enabled by digital technologies
A superior customer experience enabled by digital technologies is well on its way
Slide 17: Customer centricity: CEMEX Go, innovation, ventures
Mecsex e smart_ G @) innovation | Meucnex ventures Customer Centricity CEMEX DAY 2019
Slide 18: Implementing a digital transformation that is an industry first
Implementing a digital transformation that is an industry first For all our products For all our segments Device agnostic Available 24/7 End-to-end platform
Slide 19: Fully implemented in all geographies
Fully implemented in all geographies Mexico & USA SCA&C Europe AME&A
Slide 20: 90%+ targeted customers
Mexico & USA SCA&C Europe 90%+ targeted customers Fully implemented in all geographies AME&A
Slide 21: 45%+ of orders
Mexico & USA SCA&C Europe 45%+ of orders 90%+ targeted customers Fully implemented in all geographies AME&A
Slide 22: Will continue transforming our industry
Customer feedback Employee experience Emerging technologies Systems integration Benchmark market solutions Will continue transforming our industry
Slide 23: Realigned management to reflect strategic priorities
Realigned management to reflect strategic priorities CEO Fernando A. González Europe Sergio Menendez Supply Chain Jaime Elizondo USA Ignacio Madridejos Commercial Dev. Juan Romero SCA&C Jaime Muguiro Sustainability & Ops. Dev. Jesús González AMEA Joaquín Estrada Mexico Ricardo Naya IR, CC & PA Maher
Slide 24: Remain committed to continually improving ESG practices
Remain committed to continually improving Environmental, Social and Governance practices Environmental Social Governance
Slide 25: Important contributions to a sustainable environment
We are making important contributions to a sustainable environment 1) Vs. 1990 baseline 13 M T of waste used as fuels and raw materials 7.9 M T of avoided CO2 emissions1 27% Alternative fuels utilization 26% Power from renewable sources -6pp Reduction in clinker factor1 1.4 M Emissions generated by
Slide 26: Pursuing the well-being of our stakeholders
Health & Safety Employee experience Communities Pursuing the well-being of our stakeholders
Slide 27: First year ever with zero employee fatalities
First year ever with zero employee fatalities Industry leader in employee LTI frequency rate of 0.5 96% of operations were injury-free Health & Safety Employee experience Communities LTI frequency rate: Lost time injuries per millions hours worked Pursuing the well-being of our stakeholders
Slide 28: Pursuing the well-being of our stakeholders
Pursuing the well-being of our stakeholders 79% recommend CEMEX as a good place to work 89% recommend CEMEX products and services to family and friends Health & Safety Communities Employee experience
Slide 29: Pursuing the well-being of our stakeholders
Pursuing the well-being of our stakeholders 16 M+ people positively impacted by social initiatives 100% of our cement plants have community engagement plans Health & Safety Employee experience Communities
Slide 30: Strengthening corporate governance
Strengthening corporate governance 1) Subject to shareholder approval at Ordinary General Shareholders´ Meeting to be held on March 28, 2019 Separation of Chairman and CEO roles in 2014 60% of current Board members joined in last 4 years1 Reduced average tenure to 11, from 18 years in 20141 Improved
Slide 31: What to expect from us
What to expect from us Continue to improve Health & Safety performance Continue to implement A Stronger CEMEX Deliver solid top-line growth with pricing in excess of input costs Sustain FCF of ~$1 B per year supporting deleveraging path to reach < 3.0x target Provide a superior customer experience e