Cemex 2009 Annual Report Download - page 17

management discussion
and ANALYSIS
MOVING FORWARD
BUSINESS
CEMEX is a global building materials company that
provides products of consistently high quality and reliable
service to customers and communities across the world.
We advance the well-being of those we serve through
our relentless focus on continuous improvement and our
efforts to promote a sustainable future.
Our company was founded in Mexico in 1906, and we
have grown from a local player to one of the top global
companies in our industry, with close to 47,000 employees
worldwide. Today we are strategically positioned in the
Americas, Europe, Africa, the Middle East, and Asia. Our
operations network produces, distributes, and markets
cement, ready-mix concrete, aggregates, and related build-
ing materials to customers in over 50 countries, and we
maintain trade relationships in close to 100 nations.
BUSINESS STRATEGY
We have built a portfolio of assets with sustainable, profit-
able, long-term growth potential. Looking forward, we will:
Focus on our core business of cement, ready-mix con-•฀
crete, and aggregates
Provide our customers with the best value proposition•฀
Regain our financial flexibility•฀
Maximize our operating efficiency•฀
Foster our sustainable development•฀
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Our geographically diverse portfolio of cement, ready-mix
concrete, and aggregates assets well positions us for the
recovery of the global economy, providing us with the op-
portunity for significant organic growth over the medium
and long term. By managing our cement, ready-mix con-
crete, and aggregates assets as one integrated business
rather than as distinct businesses, we further improve
their efficiency and profitability.
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We always work to provide superior building solutions
in the markets we serve. To this end, we customize our
products and services to meet our customers’ needs—
from home construction, improvement, and renovation to
agricultural, industrial, and marine/hydraulic applications.
We also see abundant opportunities to deepen our
customer relationships by focusing on more vertically in-
tegrated building solutions rather than separate products.
By developing our integrated offerings, we can provide
customers with more reliable, higher-quality service and
more consistent product quality.

While we continually look to produce profitable growth
over the short, medium, and long term, given the envi-
ronment in which we are living, our priority is to regain
our financial flexibility—which is key to our long-term
growth.
Completed in the third quarter of 2009, our US$15 billion
financing agreement provides us with the time and flex-
ibility to deleverage our balance sheet—through free cash
flow generation, asset sales, equity and debt issuances,
and other capital market initiatives—as our markets and
the financial environment recover. Indeed, with the net
proceeds from our global equity offering, the sale of our
Australian operations, and our issuance of notes achieved
after the completion of the financing agreement, as of
January 2010, we had prepaid US$4.8 billion of principal
outstanding under this agreement, achieving its year-end
2010 milestone in advance.
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We constantly look for ways to reduce our costs and
maximize our operating efficiency. In 2009, we imple-
mented a US$900 million cost-reduction program. Ap-
proximately 60% of these cost savings are recurrent—in-
cluding initiatives to improve our operating efficiency. The
remaining 40% is a result of the steps taken to align our
operations with market demand, which we will reverse
as the market eventually recovers. Moving ahead, we will
continue to implement our cost-reduction and right-sizing
initiatives and maintain tight discipline on our capital
expenditures.
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We are committed to the sustainable growth and develop-
ment of our company. Our approach is based on working
closely with our stakeholders—our employees and their
families, our neighbors, our business partners, and our
world at large—to help solve the local and global sustain-
ability challenges of our business. To this end, we focus on
three areas:
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