Cemex Reports Strong Profit Growth Despite Revenue Miss in Q1

Cemex, a NYSE-listed Mexican cement maker, reported a 13% increase in its first quarter net profit on Thursday, exceeding analysts' estimates. The company's net profit reached $254.4 million, surpassing the consensus estimate of $218.2 million. However, Cemex's revenue inched up just 3% year-over-year to $4.14 billion, falling short of analysts' expectations of $4.19 billion, despite volumes declining in all of its product segments.

The company's operating earnings declined, but Cemex benefited from lower taxes and reduced exposure to financial derivatives. Sales in Cemex's top market, Mexico, rose an impressive 20% compared to the previous year. In contrast, revenues and volumes dipped slightly in the U.S. due to unfavorable weather conditions.

Cemex's European and Middle Eastern unit experienced mixed demand conditions, with volumes impacted by fewer working days, adverse weather, and a strong performance in the year-ago quarter. The company's core earnings, measured by EBITDA, climbed 5% year-over-year to $772.4 million, missing estimates of $780 million. The EMEA unit's performance dragged down the strong growth seen in Mexico and the rest of Latin America.

Why this matters: Cemex's Q1 2024 earnings report provides insights into the global construction industry's recovery and the company's ability to navigate challenges in different markets. The mixed results highlight the varying impact of economic conditions and weather on Cemex's performance across regions.

Growth Ahead: Cemex Outlook: Looking ahead, Cemex slightly increased its full-year outlook for cement and ready-mix volumes in Mexico. The company is scheduled to report its Q1 2024 earnings on April 25th, with consensus estimates of $0.19 EPS and $4.14B revenue, representing a 2.6% year-over-year increase. Analysts predict that for the full fiscal year, Cemex will report a profit per share of $0.675 and sales of $18.13 billion, compared to $0.130 and $17.39 billion in the previous year, respectively.

Key Takeaways

• Cemex Q1 net profit up 13% to $254.4M, beating estimates of $218.2M.
• Revenue up 3% to $4.14B, missing estimates of $4.19B due to volume declines.
• Mexico sales up 20%, but U.S. revenue and volumes dipped due to weather.
• EBITDA up 5% to $772.4M, missing estimates of $780M due to EMEA performance.
• Cemex raises 2024 outlook for cement and ready-mix volumes in Mexico.