Adrian Huerta

Adrian Huerta from JPMorgan Chase & Co. asked about future sources of additional free cash flow, specifically focusing on intangible investments like mining rights and IT, and the potential for further reductions in CapEx and other expenses beyond 2026.

Answer

CEO Jaime Muguiro clarified that intangible investments include IT and mineral rights (if acquired as rights, not reserves). He stated that CEMEX plans to continue reducing both strategic CapEx and intangibles in 2026 and beyond as part of their new capital allocation strategy. Specifically, IT investments are being reduced by $61 million in 2026 compared to 2025, with further reductions expected in 2027.

Adrian Huerta questioned the potential sources for additional free cash flow from reduced expenses or CapEx, specifically intangible investments like mining rights, and other expenses that could be cut.

Answer

CEO Jaime Muguiro clarified that intangibles include IT investments and mineral rights. He stated plans to continue reducing both strategic CapEx and intangibles in 2026 and beyond, noting a $61 million reduction in IT investments for 2026 compared to 2025, with further reductions expected in 2027.

Adrian Eugenio Huerta inquired about the outlook for Mexico's volumes in 2026, particularly in light of infrastructure bottlenecks and historical recovery patterns following presidential changes, asking if a recovery of at least half of the volumes lost in 2025 is anticipated.

Answer

CEO Jaime Muguiro expressed confidence that Mexico's demand volumes would grow by at least 2.5% to 3% in 2026, driven by infrastructure projects and accelerating social housing programs. He highlighted CEMEX's strong position to gain market share in infrastructure. Chief Communications Officer Lucy Rodriguez added that official guidance would follow in February but confirmed a positive outlook.

Adrian Huerta inquired about the potential for volume recovery in Mexico for 2026, drawing parallels to historical recoveries after presidential changes and seeking additional insights into Cemex's confidence.

Answer

CEO Jaime Muguiro expressed confidence that Mexico's demand volumes would grow by at least 2.5%-3% in 2026, driven by infrastructure projects and social housing. He highlighted Cemex's strong operational capabilities to gain market share in infrastructure. Chief Communications Officer Lucy Rodriguez added that more specific guidance would be provided in early February, but the outlook remains positive.

Adrian Huerta from JPMorgan Chase & Co. asked about the medium-term (18 months) and long-term (2-3 years) outlook for the EMEA region, given its tremendous year-to-date performance.

Answer

CEO Jaime Muguiro expressed a bullish outlook for EMEA, citing strong fundamentals and growth potential in Israel and a recovery in Europe driven by infrastructure spending in Spain and Germany. He highlighted long-term tailwinds from the CBAM and phase-out of free CO2 allowances starting in 2026-2027, which should support pricing, along with potential industry capacity rationalization.

Adrian Huerta from JPMorgan Chase & Co. asked for more details on the 'Project Cutting Edge' cost-savings program and the new CEO's strategic focus on geographical mix and investments.

Answer

CEO Jaime Dominguez explained that 'Project Cutting Edge' is the foundation for broader changes, including reducing overheads and empowering regions. He stated the company will focus on Mexico, the U.S., and Europe, with a relentless emphasis on improving free cash flow conversion and ensuring every asset delivers a return on capital employed (ROCE) above the weighted average cost of capital (WACC), which may lead to further divestments.

Adrian Huerta of JPMorgan Chase & Co. questioned U.S. operations, asking why CEMEX's reported price increases lagged peers and for an explanation of the expected decline in U.S. aggregate volumes for 2025.

Answer

Executive Lucy Rodriguez explained that overall U.S. pricing was impacted by significant challenges in the Texas market during the first half of 2024, related to import and weather disruptions. She clarified that the guided decline in 2025 aggregate volumes is a supply-side issue, driven by a few quarries reaching their end-of-life, not a reflection of lower demand.

Adrian Huerta asked about the impressive cost per ton performance, specifically the actions taken under 'Vulcan Way of Operating' and how many more quarters of strong cost performance can be expected.

Answer

Ronnie Pruitt, COO, explained that technology investments are complete in top plants, and the focus is now on human behavioral aspects and training. He anticipates significant room for improvement, with 2026 expected to show even more momentum. Tom Hill, Chairman and CEO, added that this is a multi-year effort, with years of improvement ahead.

Adrian Huerta asked about Amrize's M&A environment outlook for the next 12 months and potential opportunities for expansion across its segments.

Answer

Jan Jenisch, Chairman and CEO, confirmed that M&A is a significant part of Amrize's strategy, complementing organic growth. He mentioned a 'healthy pipeline of targets and projects' and expressed optimism for potential announcements in the coming months.

Adrian Huerta asked about Amrize's M&A environment and potential expansion opportunities across its segments over the next 12 months.

Answer

Jan Jenisch, Chairman and CEO of Amrize, confirmed that M&A is a key part of their strategy, alongside organic growth. He mentioned a healthy pipeline of targets and projects, expressing hope for news in the coming months.

Adrian Huerta asked for more details on the pace of demand recovery, including any backlog of companies and the impact of USMCA clarity. He also inquired about the expected timeline for new construction starts versus land acquisitions in the coming quarters.

Answer

CEO Lorenzo Dominique Berho described a significant backlog of companies looking to establish operations in North America, driven by Mexico's strategic role. He confirmed some new construction starts by year-end and into 2026, noting that Vesta's land bank is nearly complete for the Route 2030 strategy, with focus now on infrastructure readiness.

Adrian Huerta asked for more details on the pace of demand recovery, including any backlog of companies waiting for USMCA clarity. He also inquired about expectations for new construction starts and land acquisitions over the next two to four quarters.

Answer

CEO Lorenzo Dominique Berho noted a transition year with an early slowdown, but now a significant backlog of companies looking to establish operations in North America. He highlighted Vesta's global outreach to understand manufacturing footprint analyses, observing diverse drivers for decisions, with the electronics sector showing rapid growth. Regarding development, he stated Vesta remains cautious but will have some starts by year-end, leveraging recent strategic land acquisitions in Guadalajara, Ciudad Juárez, Mexico City, Monterrey, and Tijuana to be ready for future demand, having secured approximately 90% of land for the 2030 strategy.

Adrian Huerta questioned the likelihood of leasing the new greenfield developments in Monterrey this year and asked if more land bank acquisitions should be expected.

Answer

CEO Lorenzo Dominique Berho Carranza expressed confidence that the high-quality Monterrey buildings would be leased, citing attractive development returns above 10%. He also confirmed Vesta is making strategic land acquisitions in key urban infill markets for future growth.

Adrian Huerta from JPMorgan Chase & Co. asked about the probability of leasing the new greenfield properties in Monterrey within the year. He also questioned if Vesta plans further land bank acquisitions in 2025.

Answer

CEO Lorenzo Dominique Berho Carranza acknowledged that 2025 is a slow year but expressed confidence that the high-quality buildings in Monterrey will be leased, noting that their underwriting accounts for some downtime. Regarding land, he confirmed they will continue to seek opportunities prudently without overshooting their manageable land bank.