Cemex's Q3 Earnings Fall Short of Expectations, Shares Drop 8%

MONTERREY, Mexico - Cemex, S.A.B. de C.V. (NYSE:CX) has reported third-quarter earnings that fell short of analyst expectations, leading to an 8% drop in its stock on Monday. The Mexican cement giant reported an adjusted earnings per share of $0.14, below the analyst forecast of $0.20. Revenue for the quarter came in at $4.09 billion, also below the consensus estimate of $4.26 billion, marking a 3% decline year-over-year. Despite the earnings miss, Cemex's net income surged 222% to $406 million.

Cemex CEO Fernando A. González emphasized the company's portfolio optimization efforts, stating, "I am pleased with the significant progress we have made in our portfolio optimization efforts this year. With the revenues generated, we will continue to implement our capital allocation framework aimed at prioritizing growth investments, particularly focusing on the U.S., continuing to reduce debt, and strengthening our recently launched gradual shareholder return program."

The company reported divestitures totaling $1.4 billion during the quarter, bringing the sales of non-core assets to $2.2 billion year-to-date. Cemex attributed the decline in earnings to adverse weather conditions across all its markets and significant currency fluctuations.

Geographically, Cemex experienced sales declines of 5% in Mexico, 4% in the U.S., and 1% in Central America, South America, and the Caribbean. The Europe, Middle East, and Africa region reported a 1% increase in sales.

Cemex also reported progress in its climate action initiatives, having reduced Scope 1 and 2 CO2 emissions by 3% and 4% respectively since the beginning of the year. The company's consortium was recently selected to receive €157 million from the EU Innovation Fund for a carbon capture project at its Rüdersdorf cement plant in Germany.