Caribbean Cement Company Limited Peter Donkersloot - General Manager - Jamaica Stock Exchange
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Caribbean Cement Peter Donkersloot Company Limited General Manager
DISCLAIMER
• The purpose of this document is to provide analytical tools to CCCL (Caribbean Cement Company Limited) ("the Company” hereinafter)
for use in their own decisions
• The following document is strictly internal to the Company and shall not be copied, reproduced or circulated to third parties without
permission. The contents of this document belongs exclusively to the Company and are private and confidential
• To perform the various analysis contained in this document, we have estimated market volumes, prices and calculations with the
Company's internal data or from public sources an contained in reports published by independent analysts as well as the information
obtained through the DD proceedings
• Any reference to costs, market positions, volumes and pricing of third parties have been made with the Company's estimates
considering also the information obtained in the DD
• This presentation contains analysis, comments, perceptions and value judgments (of the Company and third parties) that have been
made exclusively by the Company based on data compiled in this presentation and analysis above has not shared any information with
third parties
• All users of this presentation have been informed of their obligation to strictly enforce the law and the provisions contained in the
CEMEX Code of Ethics
Agenda
HISTORY
OUR NEW BUSINESS PARTNER
POST MERGER INTEGRATION PROCESS
OPORTUNITIES AND RISK
WHAT`S NEXT
Q&A
Share price evolution in the past 20 years
34,8
32,5
19,0
12,9
8,9 9,5
3,0 3,5 4,3 4,0 4,1 3,1 3,0 3,5
1,7 2,9 2,0 2,4 2,4
1,0
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
* As of 31st of December each year
Reflected over outstanding results in the past years
Profits (loss) before taxation
(2008 – 2017; M J$)
1,726 1,558
1,351
572
256
-3
-241
-2,242
-2,672
-2,984
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Agenda
HISTORY
OUR NEW BUSINESS PARTNER
POST MERGER INTEGRATION PROCESS
OPORTUNITIES AND RISK
WHAT`S NEXT
Q&A
CEMEX has shown strong growth over the past ~30 years
2016 Figures CEMEX’s sales and EBITDA evolution
(US$ B, 1985-2017e)
Sales
EBITDA
Net sales
13.7
(US$ B)
EBITDA
2.6
(US$ B)
Cement Capacity
93
(MTPY)
Cement Plants 54
Ready-mix Plants 1,555
Aggregates 249
Quarries
85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17E
CEMEX top priorities guide our strategy
HEALTH & SAFETY • Zero for Life
CUSTOMER
CENTRICITY
• Reinforce our customer-focused culture
GLOBAL CEMEX • Leverage knowledge across our operations
RETURN TO
INVESTMENT GRADE • Regain financial flexibility
8
Agenda
HISTORY
OUR NEW BUSINESS PARTNER
POST MERGER INTEGRATION PROCESS
OPORTUNITIES AND RISK
WHAT`S NEXT
Q&A
We are on track to reach
our target of ZERO LTI’s
Lost Time Injuries
Direct
External
-50%
3
-50%
0
5 4 0
2
2015 2016 2017 Our goal
Total Recordable Injuries
0% -25%
3 2
2
5 6
4
2015 2016 2017 Our goal
10“If you take care of your employees, they will take care of your customers” JW Marriot
Focus on fixed costs reduction
Fixed Cost M JA$
Fixed cost
improvements:
1,178
3,859
• Scheduling maintenance
607 through preventive
methodology
3,252
• Implementing a contractor
571 management strategy
2,681
• Redefining our structures
2015 2016 2017
…decreasing Ja $ 1,2 B (~US$ 9,4 M) in 3 yearsWe have significantly reduced our working capital
Working Capital Balance in $ Ja M
End of period
2,742 Working Capital
1,702
Improvements
1,338
• Decidedly reducing our
364 327 accounts receivables
38
• Focus on inventories
1,077 reduction and specially
spare parts
-1,040
2014 2015 2016 2017 • Supplier financing
program
WCAP
38 8 1 -23
Days
…releasing Ja $ 2,742 B (~US$ 21,4 M) in 3 yearsFinding the best alternative to bring back the assets
to CCCL
Background Agreement
2017 – 2018 Asset Valuation 122.9 MUS
• Asset Price at March 31st 118.3 MUS$
Today • Excess Cash 10 – 15 M US$
• 3rd party Debt (J$)
Asset Acquisition Agreement
• Amount: Max of ~US$40 M – 60 M (eq. in J$)
38 M US$ Write-Offs • Conditions:
2010 – 2013 • At competitive price
Difficult Times 52 MUS$ debt converted to • No prepayment fees
Preference Shares • No collateral assets
• Intercompany Loan with TCL or CEMEX
TCL leased assets to CCCL
2008 – 2010
for US$ 272 M
Expansion • Preference redemption: 40.5 MUSD
• To be paid through at least 1/3 of distributable
Considering that at the end of the lease the assets will still be owned
by TCL, then CCCL assets acquisition become the best value for profits for a period not longer than 10 years.
moneyOur capacity to satisfy near future demand
1.400 1.400 1.400 1.400 1.400 1.400 1.400 1.407
1.216
1.200 1.200
Spare 1.158
Capacity 1.103
1.050
1.000
953
907
Demand
increase
5%
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027
…has spare room, of more than 2.0 Million tons to export after suppling the
Jamaican Market for the next 10 years
16Investing in our Assets to ensure Operational
Competitiveness
M US$ - Annual Capital Investment
19 Expansion
13 12 Platform
5 12
5
8 8 11 9 8
5 5 5 7 7
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Over $50 MM invested in our operation since we took over
Reiterating our commitment to building of a greater JamaicaPositively impacting over 200,000 Jamaicans by investing $200 MM JMD
Achieved our 2017 objectives
Objective Result
HEALTH & SAFETY • Reduce LTI 75% and zero for direct employees
WORKFORCE
DEVELOPMENT • Over 4000 hours of training
REDUCTION OF FIXED • Reduced by $ 1.2 Billion (US$ 9.4 M)
COST
WORKING CAPITAL • Release more than US$ 21 M though WCAP
• Bring assets to CCCL ownership with the best financial
LEASE
structure
CORPORATE SOCIAL
• More than 200.000 Jamaicans impacted
RESPONSABILITYAgenda
HISTORY
OUR NEW BUSINESS PARTNER
POST MERGER INTEGRATION PROCESS
OPORTUNITIES AND RISK
WHAT`S NEXT
Q&AJamaica has a big opportunity in infrastructure
Concrete pavements solutions with significant
advantages against asphalt
Superior Durability at Minimum Maintenance Significantly lower Cost Over the Full Life Cycle
Base Cost Asphalt Concrete
100 3
ASPHALT Initial Cost
2
Maintenance
1
CONCRETE
0
0 10 20 30 40
0 10 20 30
YEARS YEARS
Reduced Heat Island Effect Reduced Vehicle Fuel Consumption
Concrete Asphalt Concrete Asphalt
Normal (left) and thermographic (right) pictures of pavements: A 3% improvement of US
fuel consumption would save around 46.5 MMt of
Average Temperature Concrete: 33°C (92°F) CO2 yearly, the equivalent of a country like Denmark.
Average Temperature Asphalt: 49°C (121°F)Operating Costs: additional savings beyond
maintenance
The superb durability of concrete roads does
not only lead to significantly lower
maintenance costs compared to asphalt, it
also ensures minimum interruption of
operation, which is a crucial factor
particularly for toll roads. In addition, the
physical characteristics of concrete result in
potential savings in operating costs.
A concrete reflects up to three times more
Concrete is naturally brighter and more light than asphalt the lightning intensity can
reflective than other pavement surfaces be reduced by up to 30% without
compromising night visionGovernment has made housing its top priority
• Providing housing solution to
Jamaicans is a top priority for the
government
• National Housing Trust expected to
deliver more than 22,000 by 2020
• More efficient building solutions
with innovation and new
technologies
* Housing solutions in Dominican Republic and MexicoOur main External Challenges
Regulation Framework
Low enforcement on CARICOM rules to
foster economy
Competition Crime
Avoidance of rules and regulations Regulation
Importers with lower cost Framework
Economy
structure
New disruptive players Increase in Devaluation
Competition Economy Decrease in International Reserves
CCCL
Environment Energy Cost
Rain... High Electricity Cost
Flooding…Hurricanes Environment Energy Cost High Dependencies on
Dust emissions Fossil Fuel
Technology Technology
Substitute
technologies….Agenda
HISTORY
OUR NEW BUSINESS PARTNER
POST MERGER INTEGRATION PROCESS
OPORTUNITIES AND RISK
WHAT`S NEXT
Q&A“The road to success is always under construction” Lily Tomlin
What you should expect from us?
Zero Incidents in our operations
Offer a strong value proposition a solutions by bringing CEMEX technology
Further invest in our employees capabilities development
Continue our of vertical integration across markets
Continue focus on protecting and supporting the environmental efforts and
rules and enhance our social responsibility commitments
Improve our productivity to compete in international marketsFollow us in social media
https://www.facebook.com https://www.instagram.com/ https://www.caribcement.com
/caribcementja/ caribcementja/Concretus House, Spain
Q&A
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