CEMEX, Inc. announced today that it intends to begin the permitting process for the construction of a 1.9 million short ton cement manufacturing facility near Seligman, Ariz. CEMEX will invest approximately $400 million over five years in the Seligman Crossing Plant, which is expected to begin operations by 2012. The state-of-the-art facility will manufacture cement to serve the growing needs of Arizona, including the Phoenix metropolitan area.
"CEMEX is committed to balancing the demand for development in the region with environmental sustainability to ensure the utmost success for Arizona's future," said Gilberto Perez, President of CEMEX USA. "By utilizing efficient energy sources, limited amounts of water, and state-of-the-art manufacturing and environmental technologies, the Seligman Crossing project will provide much needed building materials to the state of Arizona efficiently and cost-effectively, while also creating jobs and infusing payroll and tax dollars into the region."
The historical shortage of building materials in Arizona and the southwestern United States, coupled with demographic trends that show robust population growth throughout the region, reinforces the need for the CEMEX Seligman Crossing Plant. The plant will generate significant employment opportunities for northern Arizona, both during the construction and operational phases of the project. The Seligman Crossing Plant will also provide a considerable tax base for the support of local schools, services and public infrastructure.
An application for an air permit with the Arizona Department of Environmental Quality is expected to be filed by year-end 2007 detailing CEMEX's plans to build an environmentally sensitive, state-of the-art manufacturing facility. During the pre-filing phase of the project, CEMEX has reached out to public officials, tribal nations, residents and neighboring communities, as well as environmental and business organizations, to share many of the details of the new plant and to receive their feedback. CEMEX will continue to reach out to these interested groups as the project progresses.
CEMEX has a solid record of involvement in the communities in which it does business, as well as an ongoing commitment to environmental excellence and sustainability. CEMEX has been recognized for its environmental record in Arizona and throughout the U.S., including receiving the 2007 Bronze Environmental Excellence Awards for three ready-mix locations in Phoenix and Tucson. In addition, three of CEMEX's cement manufacturing facilities across the country were the first to receive the 2007 ENERGY STAR rating from the U.S. Environmental Protection Agency and the Department of Energy for demonstrating their ability to reduce energy use and protect the environment through energy efficiency.
As a strong business partner in Arizona for nearly 20 years, CEMEX currently employs 2,400 Arizonans at more than 120 facilities throughout the state. On an annual basis, its Arizona operations provide a positive impact on its communities through a combined payroll of more than $100 million and millions more in taxes and regulatory agency fees to local and state governments.
CEMEX is a growing global building materials company that provides high quality products and reliable service to customers and communities in more than 50 countries throughout the world. CEMEX has a rich history of improving the well-being of those it serves through its efforts to pursue innovative industry solutions and efficiency advancements and to promote a sustainable future. For more information, visit www.cemexusa.com.
This press release contains forward-looking statements and information that are necessarily subject to risks, uncertainties and assumptions. Many factors could cause the actual results, performance or achievements of CEMEX to be materially different from those expressed or implied in this release, including, among others, changes in general economic, political, governmental and business conditions globally and in the countries in which CEMEX does business, changes in interest rates, changes in inflation rates, changes in exchange rates, the level of construction generally, changes in cement demand and prices, changes in raw material and energy prices, weather conditions, changes in business strategy and various other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein. CEMEX assumes no obligation to update or correct the information contained in this press release.
EBITDA is defined as operating income plus depreciation and amortization. Free Cash Flow is defined as EBITDA minus net interest expense, maintenance and expansion 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). Net debt is defined as total debt minus the fair value of cross-currency swaps associated with debt minus cash and cash equivalents. The net debt to EBITDA ratio is calculated by dividing net debt at the end of the quarter by EBITDA for the last twelve months. All of the above items are derived from generally accepted accounting principles in Mexico. EBITDA and Free Cash Flow (as defined above) are presented herein because CEMEX believes that they are widely accepted as financial indicators of CEMEX's ability to internally fund capital expenditures and service or incur debt. EBITDA and Free Cash Flow should not be considered as indicators of CEMEX's financial performance, as alternatives to cash flow, as measures of liquidity or as being comparable to other similarly titled measures of other companies.
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