Cemex 2012 Annual Report Download - page 153

Financial Terms
American Depositary Shares (ADSs) are a means for non-
U.S.-based corporations to list their ordinary equity on an
American stock exchange. Denominated in US dollars, they
confer full rights of ownership to the corporation’s underlying
shares, which are held on deposit by a custodian bank in the
company’s home country or territory. In relation to CEMEX,
Citibank, N.A. is the depositary of CEMEX’s ADSs and each
ADS represents 10 CPOs. The CEMEX ADSs are listed on the
New York Stock Exchange.
Free cash flow CEMEX defines it as operating EBITDA minus
net interest expense, maintenance capital expenditures,
change in working capital, taxes paid, and other cash items
(net other expenses less proceeds from the disposal of
obsolete and/or substantially depleted operating fixed assets
that are no longer in operation). Free cash flow is not a GAAP
measure.
LIBOR (London Interbank Offered Rate) is a reference rate
based on the interest rates at which banks borrow unsecured
funds from other banks in London.
Maintenance capital expenditures CEMEX defines it as invest-
ments incurred with the purpose of ensuring the company’s
operational continuity. These include capital expenditures on
projects required to replace obsolete assets or maintain cur-
rent operational levels and mandatory capital expenditures,
which are projects required to comply with governmental
regulations or company policies. Maintenance capital expendi-
tures is not a GAAP measure.
Operating EBITDA CEMEX defines it as operating earnings
before other expenses, net, plus depreciation and amorti-
zation. Operating EBITDA does not include revenues and
expenses that are not directly related to CEMEX’s main activ-
ity, or which are of an unusual or non-recurring nature under
International Financial Reporting Standards (IFRS). Operating
EBITDA is not a GAAP measure.
Ordinary Participation Certificates (CPOs) are issued under
the terms of a CPO Trust Agreement governed by Mexican
law and represent two of CEMEX’s series A shares and one
of CEMEX’s series B shares. This instrument is listed on the
Mexican Stock Exchange.
pp equals percentage points.
Strategic capital expenditures CEMEX defines it as invest-
ments incurred with the purpose of increasing the company’s
profitability. These include capital expenditures on projects
designed to increase profitability by expanding capacity, and
margin improvement capital expenditures, which are projects
designed to increase profitability by reducing costs. Expansion
capital expenditures is not a GAAP measure.
TIIE (Tasa de Interés Interbancaria de Equilibrio) is a measure
of the average cost of funds in pesos in the Mexican interbank
money market.
Total debt CEMEX defines it as short-term and long-term debt
plus convertible securities, liabilities secured with account re-
ceivables and capital leases. Total debt is not a GAAP measure.
Net working capital CEMEX defines it as operating accounts
plus inventories minus operating accounts payable. Working
capital is not a GAAP measure.
bps (Basis Point) is a unit of percentage measure equal to
0.01%, used to measure the changes to interest rates, equity
indices, and fixed-income securities.
Industry Terms
Aggregates are sand and gravel, which are mined from quar-
ries. They give ready-mix concrete its necessary volume and
add to its overall strength. Under normal circumstances, one
cubic meter of fresh concrete contains two metric tons of
gravel and sand.
Clean Development Mechanism (CDM) is a mechanism under
the Kyoto Protocol that allows Annex I countries to recognize
greenhouse gas emission reductions from projects developed
in Non-Annex I countries.
Clinker is an intermediate cement product made by sinter-
ing limestone, clay, and iron oxide in a kiln at around 1,450
degrees Celsius. One metric ton of clinker is used to make
approximately 1.1 metric tons of gray Portland cement.
Fly ash is a combustion residue from coal-fired power plants
that can be used as a non-clinker cementitious material.
Gray Portland cement is a hydraulic binding agent with a
composition by weight of at least 95% clinker and 0–5% of
a minor component (usually calcium sulfate). It can set and
harden underwater and, when mixed with aggregates and
water, produces concrete or mortar.
Installed capacity is the theoretical annual production capac-
ity of a plant; whereas effective capacity is a plant’s actual
optimal annual production capacity, which can be 10–20% less
than installed capacity.
Metric ton is the equivalent of 1.102 short tons.
Petroleum coke (petcoke) is a by-product of the oil refining
coking process.
Pozzolana is a fine, sandy volcanic ash.
Ready-mix concrete is a mixture of cement, aggregates, and
water.
Slag is the by-product of smelting ore to purify metals.
Terms we use
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