Cemex 2009 Annual Report Download - page 4

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moving
FORWARD
LETTER TO OUR STOCKHOLDERS
Dear fellow stockholders:
Last year was one of the most challenging we have faced in our history, as we
coped with the worst crisis to hit the global economy, our industry, and our
company in 75 years. I am pleased to report to you that, because we aggressively
adapted our business to the current market realities, we not only overcame those
challenges, but are now positioned to take advantage of the coming economic
recovery.
Our results reflect the exceptionally challenging business environment that we
faced in 2009. While leading indicators in several of our markets showed signs
of stabilization, our performance was mainly affected by the steep downturn in
demand in the United States and Spain, which offset the strong performance
of some of our other operations. For the year, our net sales decreased 28% to
US$14.5 billion, and our EBITDA declined 35% to US$2.7 billion. Our free cash
flow after maintenance capital expenditures decreased 53% to US$1.2 billion.
Even during an exceptionally difficult year, we achieved some significant ac-
complishments. Over the course of 2009, we executed an integrated financial
and operating strategy designed to reposition the company. Key elements of the
strategy included:
First, we implemented a US$900 million cost-reduction program. Approximately
60% of these cost savings are recurrent—including initiatives to improve our oper-
ating efficiency. The remaining 40% consists of steps taken to align our operations
with current market demand.
Second, we substantially reduced our maintenance- and expansion-capital
expenditures by US$1.5 billion to US$636 million in 2009. To achieve this reduc-
tion, we stopped work on several major projects, cancelled all new expansion
projects, and completed only those projects that would immediately contribute
to free cash flow.
As a result of our efforts, we are emerging from the crisis
leaner, more agile, and more focused on our core business
operations. We are in a better position to regain our
nancial exibility and to take advantage of the recovery
of the global economy.
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