Cemex 2009 Annual Report Download - page 19

CONSOLIDATED RESULTS
Net sales decreased 28% to US$14.5 billion compared
with 2008. The decline in sales was the result of lower
volumes and prices mainly from our U.S. and Spanish
operations.
Cost of sales as a percentage of sales increased 2.4 per-
centage points, from 68.2% to 70.6%. Selling, general,
and administrative (SG&A) expenses as a percentage
of sales increased 1.2 percentage points, from 20.2% to
21.4%. The increase in costs and expenses was mainly the
result of lower economies of scale due to lower volumes,
especially in the U.S., Spain, and Mexico, as well as higher
transportation costs, which were partially offset by savings
from our cost-reduction initiatives.
Operating income was down 50% to US$1.2 billion,
while EBITDA totaled US$2.7 billion, 35% less than that in
2008. The decrease was due mainly to lower contributions
from our U.S. and Spanish operations; the exclusion of our
Venezuelan operations starting August 1, 2008; and the
sale of our assets in the Canary Islands during the fourth
quarter of 2008. Our EBITDA margin decreased 2.0 per-
centage points, from 20.3% in 2008 to 18.3% in 2009.
Financial expenses increased 9% to US$994 million as
a result of the financing agreement and the closing of our
debt-related derivative instruments.
We reported a loss on financial instruments of US$156
million in 2009 compared with a loss of US$1.4 billion
in 2008. This positive variation resulted mainly from the
unwinding of the majority of our derivative instruments, as
well as the gain in our equity derivatives related to CEMEX
and Axtel shares.
Our majority interest net income for the year decreased
49% to US$104 million. This sum includes the result of
the sale of our Australian assets, which amounted to a
loss, net of income tax. This loss represents the difference
between the selling price of approximately US$1.7 billion
and the book value of the net assets, including foreign cur-
rency translation effects, accrued in equity.
Free cash flow decreased 53% to US$1.2 billion, which
we used mainly to pay down debt, pay expansion capital
expenditures, pay the coupons on perpetual notes, pay
fees related to debt refinancing, cover the cost of closing
out derivative positions, and for other uses.
Net debt was US$15.1 billion at the end of 2009 com-
pared with US$18.0 billion at year-end 2008.
SALES AND EBITDA
millions of US dollars
FREE CASH FLOW
millions of US dollars
00 01 02 03 04 05 06 07 08 09
2,600
2,455
2,689
2,198
1,478
1,143
948
1,145
886
1,215
17
00 01 02 03 04 05 06 07 08 09
14,544
2,657
20,131
4,080
20,893
4,512
18,249
4,138
15,321
3,557
8,149
2,538
7,164
2,108
6,543
1,917
6,923
2,256
5,621
2.030
l SALES l EBITDA