The company Cemex has had to lower its projections for the current year after reporting results below expectations in the third quarter. Due to this, the company reduced its estimates for sales volumes and operating cash flow for the year and also decreased its planned fixed asset investments for the current year by 100 million dollars.
Cemex's revenues for the quarter were three percent lower than consensus expectations, with cash flow also eight percent below estimates. This decline was reflected in the cement, concrete, and aggregates sectors, where average drops of around three percent, 3.1 percent, and one percent are expected, respectively.
Alejandra Vargas, an analyst at GFBX+, rated Cemex's results as mixed and below expectations. The company reported revenues of four billion 90 million dollars for the quarter, which represented a three percent decrease compared to the same period last year.
The explanation for the decline in sales volumes is attributed to exceptional weather conditions that affected all the company's regions. Despite a growth in prices in local currency, this impact was offset by lower volumes, resulting in a reduction of operating cash flow, which stood at 747 million dollars.
Gerardo Cevallos, Deputy Director of Fundamental Analysis at Vector Casa de Bolsa, mentioned that investments aimed at the growth of the company and the impact of costs balanced out in the quarter, but the drop in operating cash flow was mainly due to the volume effects.
Overall, Cemex attributed its affected results to unusual weather conditions, a slowdown in construction activity in Mexico, a temporary increase in electricity costs, and higher maintenance expenses in certain regions. The company has adjusted its cash flow guidance for the current year, moving from expecting low to mid-single-digit growth to estimating a low single-digit decline in comparable terms.
