Cemex 1997 Annual Report Download - page 36

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1997 CONSOLIDATED RESULTS
Sales
Net Sales grew 8% in real terms during the year, as
compared to 1996, and reached $30.573 billion
pesos. This increase is due to the subsidiaries’ larger
volumes, in general, and to the consolidation of the
Colombian operations of Samper at the beginning of
1997, which contributed 5 percentage points to this
increase. In dollar terms, net sales increased at a
greater rate, as they rose to US$3.788 billion and
were 13% higher as a result of the stability of the
Mexican peso vis-à-vis the US dollar during the last
twelve months.
Gross Profit
The sales increase, together with the 9% growth in
cost of sales, caused Gross Profit to increase 6% from
1996 to 1997 and to reach $11.838 billion pesos.
Nevertheless, relative to sales, gross margin decreased
from 39.4% in 1996 to 38.7% in 1997.
Operating Income
Operating Income grew 7% in real terms and reached
$7.224 billion pesos in 1997, and grew 12% in dollar
terms, reaching US$895 million. The operating mar-
gin decreased slightly from 23.8% in 1996 to 23.6%
in 1997, since the decrease in gross margin was partly
offset by a decrease in operating expenses as a per-
centage of sales during 1997.
Operating Cash Flow
Operating Cash Flow (Operating Income plus
Depreciation or EBITD) during the year was $9.631
billion pesos, or US$1.193 billion, showing an
increase of 6% in real terms and 10% in dollars over
that of 1996. The operating cash flow margin was
31.5% during the year, as compared with 32.3%
in 1996.
30
Management Discussion
and Analysis of Financial Condition and
Results of Operations of the Company
MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
CEMEXÕ international opera-
tions are 54% of consolidated
revenues.
Operating cash flow
Operating Income plus
Depreciation
Colombia 11%
Central America
& the Caribbean 6%
USA 4%
Venezuela 14%
Mexico 46%
Spain 19%
CEMEX' combination of bottom-up
management style, wise strategic
investments and cost-efficient facili-
ties make it the best-managed compa-
ny in Latin America. It's not your typi-
cal, completely conformist, top-down
culture. When they do something,
they do it very well, wherever they
do it. TheyÕve really delivered
results.
Chris Taylor, BT Alex. Brown
(Latin Trade, 1/98)