Operating EBITDA reached US$62mn during the second quarter, 19% lower on a year-over-year basis.
During the second quarter of 2018, the company says consolidated domestic grey cement, ready-mixed and aggregates volumes decreased by 8%, 14% and 12%, respectively, compared to those in the second quarter of 2017. CLH’s consolidated prices in US-dollars terms for domestic grey cement increased by 3%, for ready-mixed decreased by 1%, while for aggregates remained flat, during the quarter on a year-on-year basis.
CLH operates in the building solutions industry in Colombia, Panama, Costa Rica, Nicaragua, El Salvador, Guatemala and Brazil.
Jaime Muguiro, CEO of CLH, said that the results were heavily affected during the quarter by two external factors: “First, in Panama, the construction workers strike that started in mid-April lasted for 30 days and was the longest nationwide construction strike in the recent history of the country. Second, the situation in Nicaragua that started in mid-April, escalated and is having a material impact in economic activity and construction."
Maguiro added that, despite these issues, CLH's free cash flow during the quarter reached US$46mn, 60% higher than that of the same period of 2017, and its net debt was reduced by US$47mn, reaching US$856mn.
During the rest of this year, CLH expects to continue generating free cash flow and to receive US$30mn related to the sale of its cement-distribution business in Brazil. Free cash flow and the proceeds from this asset sale will be used to pay down debt.
CLH says that in Colombia its cement prices during the quarter continued their upward trajectory since last July. Its prices between July 2017 and June 2018 were 8% and 11% higher in local currency and in dollar terms, respectively.
In Costa Rica, CLH's cement and ready-mix volumes during the second quarter increased by 18% and 29%, respectively. The company says this positive performance was mainly due to its participation in big projects such as the new building for the Parliament and Oxígeno, as well as to its value-added offers for the industrial segment.
In Guatemala, cement and ready-mix volumes increased by 6% and 46%, respectively, reaching quarterly record levels in both businesses.
Maguiro gave an update of the implementation of CEMEX Go, the digital value proposition by which CEMEX customers can order, track and trace deliveries, make payments, as well as manage invoices and queries digitally.
"In Colombia, after only 4 months of launching CEMEX Go, we have onboarded 100% of our targeted customer base and, so far, we are receiving more than 40% of the purchase orders, as well as about 20% of payments, through our digital solution. We are encouraged by the positive reaction from our customers," said Maguiro.
"This month we launched CEMEX Go in Panama, Costa Rica and El Salvador, and later this year we will launch it in Guatemala.
"We believe that CEMEX Go will give us a competitive advantage as we will be able to deliver a superior customer experience, while we find ways to reduce our cost to serve.”
