=============================================================================== UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ----------------------- FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 or 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934 ----------------------- Date of Report: October 14, 2003 CEMEX, S.A. de C.V. (Exact name of Registrant as specified in its charter) CEMEX Corp. (Translation of Registrant's name into English) United Mexican States (Jurisdiction of incorporation or organization) Av. Ricardo Margain Zozaya #325, Colonia del Valle Campestre Garza Garcia, Nuevo Leon, Mexico 64000 (Address of principal executive offices) Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F. Form 20-F |X| Form 40-F ___ Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes ____ No |X| If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): N/A ================================================================================ Contents 1 Press release announcing CEMEX's results for the third quarter of 2003 (attached hereto as exhibit 1). 2 Press release announcing non-dilutive equity offering by CEMEX and current selling shareholders (attached hereto as Exhibit 2). SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, CEMEX, S.A. de C.V. has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CEMEX, S.A. de C.V. ---------------------- (Registrant) Date: October 14, 2003 By: /s/ Rafael Garza ------------------------ --------------------------- Name: Rafael Garza Title: Chief Comptroller EXHIBIT INDEX EXHIBIT NO. DESCRIPTION 1 Press release announcing CEMEX's results for the third quarter of 2003. 2 Press release announcing non-dilutive equity offering by CEMEX and current selling shareholders (attached hereto as Exhibit 2). EXHIBIT 1 CEMEX [GRAPHIC OMITTED] Stock Listing Information NYSE (ADR) Ticker: CX MEXICAN STOCK EXCHANGE Ticker: CEMEX.CPO Ratio of CEMEX.CPO to CX= 5:1 Investor Relations In the United States 1 877 7CX NYSE In Mexico 52 (81) 8888 4292 E-Mail ir@cemex.com www.cemex.com Third quarter Third quarter ------- -------- ------- -------------------- 2003 2002 % Var. 2003 2002 ---------------------------- ------- -------- ------- ---- ------------------------ Net Sales 1,834 1,721 7% % of Net Sales ---------------------------- ------- -------- ------- ---- ------------------------ Gross Profit 791 761 4% 43.1% 44.2% ---------------------------- ------- -------- ------- ---- ------------ ----------- Operating Income 405 354 14% 22.1% 20.6% ---------------------------- ------- -------- ------- ---- ------------ ----------- Majority net income 140 17 749% 7.6% 1.0% ---------------------------- ------- -------- ------- ---- ------------ ----------- EBITDA 570 505 13% 31.1% 29.3% ---------------------------- ------- -------- ------- ---- ------------ ----------- Free cash flow 384 217 77% ---------------------------- ------- -------- ------- ---- ------------ ----------- ---------------------------- ------- -------- ------- Net debt 5,676 6,311 (10%) ---------------------------- ------- -------- ------- Net debt/EBITDA 2.8 3.1 ---------------------------- ------- -------- ------- Interest coverage 5.0 5.5 ---------------------------- ------- -------- ------- Quarterly earnings per ADR 0.43 0.05 699% ---------------------------- ------- -------- ------- Average ADRs outstanding 323.3 304.2 6% ------------------------------------------------------------------------------------ In millions of U.S. dollars, except ratios and per-ADR amounts. Average ADRs outstanding presented in millions of ADRs. Consolidated Net sales increased 7% from the third quarter of 2002 to US$1,834 million. The increase was due to higher sales in Mexico, Spain, Colombia, Egypt, the Central America and Caribbean region, and in our Asia region. Cost of Goods Sold as a percentage of net sales increased by 1.1 percentage points versus the year-earlier period, mainly due to higher energy and insurance costs, and a higher proportion of ready-mix sales. Selling, General and Administrative Expenses (SG&A) decreased 5% versus the third quarter of 2002. As a percentage of sales, SG&A decreased 2.6 percentage points versus the third quarter of 2002 and 1.9 percentage points for the first nine months of the year versus the comparable period in 2002. The reduced SG&A and SG&A margin is due to our continuing efforts to reduce overhead; specifically, a significant reduction in travel expenses and external fees. EBITDA increased 13% from a year ago to US$570 million, and our consolidated EBITDA margin increased from 29% in the year-earlier period to 31% in the third quarter of 2003. The two percentage-point increase is mainly due to higher sales volumes and lower SG&A. Foreign Exchange Gain (loss) for the quarter was a loss of US$118 million, versus a loss of US$6 million in the year-earlier period. The loss was mainly due to the depreciation of the Mexican peso, and the appreciation of the Japanese Yen versus the U.S. dollar during the quarter. Marketable Securities Gain (loss) for the quarter was a gain of US$6 million, versus a loss of US$247 million in the year-earlier period. The gain is explained by the increase in value of our derivatives position, mainly our equity forward contracts designed to hedge our stock option plans, and our interest rate derivatives, a portion of which is recognized through our income statement. Majority Net Income for the quarter was US$140 million, versus US$17 million in the third quarter of 2002. The increase is mainly due to stronger sales in most of our markets and continued efforts to reduce costs, combined with the improvement in our marketable securities position versus the third quarter of 2002. Net debt at the end of the third quarter was US$5,676 million, US$153 million lower than that of the second quarter of this year. The ratio of Net debt to EBITDA reached 2.8 times, versus 3.0 times at the end of the second quarter of 2003. Free cash flow in the amount of US$215 million was used to reduce net debt during the quarter; however, when expressed in U.S. dollars, net debt decreased by US$153 million due to the appreciation of the Japanese Yen and the Euro versus the U.S. dollar during the quarter. ------------------------------------------------------------------------------- Please refer to the end of this report for definition of terms, U.S. dollar translation methodology Page 3 and other important disclosures. Page 1 [GRAPHIC OMITTED] CEMEX EBITDA & Free Cash Flow -------------------------------------------------------------------------------------------------------- Third quarter January-September -------- ------- -------- ------- ------ ----------- 2003 2002 % Var. 2003 2002 % Var. ----------------------------------------------- -------- ------- -------- ----------- ------ ----------- Operating income 405 354 14% 1,095 1,057 4% ----------------------------------------------- -------- ------- -------- ----------- ------ ----------- + Depreciation and operating amortization 165 151 478 447 ----------------------------------------------- -------- ------- -------- ----------- ------ ----------- EBITDA 570 505 13% 1,573 1,504 5% ----------------------------------------------- -------- ------- -------- ----------- ------ ----------- - Net financial expense 91 79 268 208 ----------------------------------------------- -------- ------- -------- ----------- ------ ----------- - Capital expenditures 96 106 261 285 ----------------------------------------------- -------- ------- -------- ----------- ------ ----------- - Change in working capital (34) 62 53 148 ----------------------------------------------- -------- ------- -------- ----------- ------ ----------- - Taxes paid 13 24 57 133 ----------------------------------------------- -------- ------- -------- ----------- ------ ----------- - Preferred dividend payments 7 7 21 28 ----------------------------------------------- -------- ------- -------- ----------- ------ ----------- - Other cash items 13 10 39 46 ----------------------------------------------- -------- ------- -------- ----------- ------ ----------- Free cash flow 384 217 77% 874 656 33% ----------------------------------------------- -------- ------- -------- ----------- ------ ----------- In millions of U.S. dollars. During the quarter, US$384 million of free cash flow was used as follows: US$215 million to reduce net debt, however net debt was reduced by US$153 million during the quarter as a result of foreign exchange rates movements in the amount of US$62 million; US$120 million to acquire the cement assets of Dixon-Marquette Cement, and other investments; US$13 million to reduce notional amount of equity derivatives; US$31 million in interest payments in excess of accrued interest; and US$5 million in other uses. EBITDA and free cash flow (calculated as set forth above) are presented herein because CEMEX believes that they are widely accepted as financial indicators of its 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. EBITDA is reconciled above to operating income which CEMEX considers to be the most comparable measure as determined under generally accepted accounting principles in Mexico (GAAP). Free cash flow is reconciled to EBITDA. CEMEX is not required to prepare a statement of cash flows under Mexican accounting principles and, as such does not have such GAAP cash flow measures to present as comparable to EBITDA or free cash flow. Debt Related Information [GRAPHIC OMITTED] Third quarter Second quarter Third quarter ----------------------- -------------------- -------------- 2003 2002 % Var. 2003 2003 2002 ---------------------------- ------- -------- ------- -- ------- -------- --- ----------------------------------- -------- Total debt 5,368 5,931 (9%) 5,824 Currency denomination ---------------------------- ------- -------- ------- -- ------- -------- --- Short term 21% 32% 34% ---------------------------- ------- -------- ------- -- ------- -------- --- ----------------------------------- ------- Long term 79% 68% 66% U.S. Dollar 75% 76% ---------------------------- ------- -------- ------- -- ------- -------- --- ----------------------------------- ------- Equity obligations 716 716 0% 716 Japanese Yen 13% 12% ---------------------------- ------- -------- ------- -- ------- -------- --- ----------------------------------- ------- Cash & cash equivalents 409 336 22% 711 Euro 11% 11% ---------------------------- ------- -------- ------- -- ------- -------- --- ----------------------------------- ------- Net debt 5,676 6,311 (10%) 5,829 Other 1% 1% ---------------------------- ------- -------- ------- -- ------- -------- --- ----------------------------------- ------- Interest expense 94 89 96 Interest rate ---------------------------- ------- -------- ------- -- ------- -------- --- Preferred dividends 7 7 6 ---------------------------- ------- -------- ------- -- ------- -------- --- ----------------------------------- ------- Interest coverage 5.0 5.5 4.9 Fixed 69% 37% ---------------------------- ------- -------- ------- -- ------- -------- --- ----------------------------------- ------- Net debt/EBITDA 2.8 3.1 3.0 Variable 31% 32% ---------------------------- ------- -------- ------- -- ------- -------- --- ----------------------------------- ------- Capitalization ratio 44.4% 47.5% 46.9% Fixed deferred 0% 31% ---------------------------- ------- -------- ------- -- ------- -------- --- ----------------------------------- ------- In millions of U.S. dollars, except ratios. Other developments On August 8, 2003 we amended and increased our existing U.S. Commercial Paper Program to US$400 million until August 2005. The transaction involved 16 relationship banks. During the third quarter we launched through one of our subsidiaries in Europe a new two and three-year multi-tranche loan in Euros, Dollars and Yens. The transaction was successfully over-subscribed and will be increased to US$1.15 billion equivalent. This transaction is not yet closed. The proceeds will be applied to repurchase the remaining US$650 million in Preferred Equity and to refinance US$400 million outstanding under a Revolving Credit Facility, both of which mature in 2004. ------------------------------------------------------------------------------- Please refer to the end of this report for definition of terms, U.S. dollar translation methodology Page 3 and other important disclosures. Page 2 [GRAPHIC OMITTED] CEMEX Equity Related Information One CEMEX ADR represents five CEMEX CPOs. The following amounts are expressed in CPO terms. Beginning of quarter CPO-equivalent units outstanding 1,615,311,339 ------------------------------------------------------ ---------------------- Net effect of share repurchase program 3,318,700 Exercise of stock options not hedged 397,293 Change in the number of CPOs held in subsidiaries 2,505 End of quarter CPO-equivalent units outstanding 1,619,029,837 ------------------------------------------------------ ---------------------- Outstanding units equal total shares issued by CEMEX less shares held in subsidiaries. Employee stock options plans As of September 30, 2003, directors, officers and other employees under our employee stock options plans had outstanding options to acquire 149,764,397 CEMEX CPOs. Of the total options outstanding, 94.9% are hedged through equity forward agreements and will not dilute existing shares when exercised. The total amount of these options programs represents 9.3% of total CPOs outstanding. Derivative Instruments -------------------------------------------------------------------------------- CEMEX periodically utilizes derivative financial instruments such as interest rate and currency swaps, currency and equity forward contracts, options and futures in order to achieve our funding strategy and to hedge our stock options plans and other equity related obligations. The following table shows the notional amount for each type of derivative instrument, and the aggregate fair market value for all of CEMEX's derivative instruments as of the last day of each quarter presented. Third quarter Second quarter ------------------- ----------------- Notional amounts 2003 2002 2003 ---------------------------------------------- -------- ------- --- ------- -------- ---- Equity * 1,532 1,431 1,544 Foreign Exchange 3,090 3,190 3,290 Interest Rate 3,233 4,294 3,576 ---------------------------------------------- -------- ------- --- ------- -------- ---- Estimated aggregate fair market value (162) (461) (223) ---------------------------------------------- -------- ------- --- ------- -------- ---- In millions of U.S. dollars. The estimated aggregate fair market value represents the approximate settlement result as of the valuation date, based upon quoted market prices and estimated settlement costs, which fluctuate over time. Fair market values and notional amounts do not represent amounts of cash currently exchanged between the parties; cash amounts will be determined upon termination of the contracts considering the notional amounts, quoted market prices, as well as the other derivative items as of the settlement date. Fair market values should not be viewed in isolation, but rather in relation to the fair values of the underlying hedge transactions and the overall reduction in the company's exposure to the risks being hedged. * The aggregate weighted average exercise price on September 30, 2003 for CEMEX's outstanding stock options, warrants and the CAH obligation described in prior quarterly reports was US$25.28 per ADR. On that same date, the aggregate weighted average strike price of CEMEX's equity forward agreements put in place to hedge our obligations under the abovementioned stock options was US$22.97 per ADR. Under Mexican GAAP ("Bulletin C-2"), companies are required to recognize all derivative financial instruments in the balance sheet as assets or liabilities, at their estimated fair market value, with changes in such fair values recorded on the income statement. The exceptions to the rule, as they refer to CEMEX, are presented when transactions are entered for hedging purposes. In such cases, the related derivative financial instruments should be valued using the same valuation criteria applied to the hedged asset, liability or equity instrument. CEMEX has recognized increases in assets and liabilities, which resulted in a net liability of US$623 million, arising from the fair value recognition of its derivatives portfolio as of September 30, 2003. The notional amounts of derivatives substantially match the amounts of underlying assets, liabilities or equity transactions on which the derivatives are being entered into. ------------------------------------------------------------------------------- Please refer to the end of this report for definition of terms, U.S. dollar translation methodology Page 3 and other important disclosures. Page 3 [GRAPHIC OMITTED] CEMEX Other Activities -------------------------------------------------------------------------------- CEMEX announces non-dilutive equity offering On October 1, 2003, CEMEX announced that it and certain selling ADS holders intend, subject to market and other conditions, to commence a public offering of 25.5 million of its American Depositary Shares plus up to an additional 15% of that amount to cover over-allotments. This transaction will not increase the number of shares outstanding and thus will not dilute existing shareholders. The ADSs are being offered in connection with the unwinding of several forward contracts entered into between certain banks, including the selling ADS holders, and CEMEX. The proceeds of the offering will be applied against certain amounts CEMEX is obligated to pay under these forward contracts, with any excess paid to CEMEX. Subject to market conditions, CEMEX intends to use a portion of the net proceeds available to it to conduct a cash tender offer for all or a portion of its outstanding appreciation warrants, including appreciation warrants represented by American Depositary Warrants (NYSE: CX.WSB). However, CEMEX is under no obligation to proceed with the appreciation warrant tender offer. Subsidiary of CEMEX Inc. acquires Dixon-Marquette Cement assets On September 25, 2003, a subsidiary of CEMEX, Inc. acquired the cement assets of Dixon-Marquette Cement for a total purchase price of approximately US$84 million. Located in Dixon, Illinois, the single cement facility has an annual production capacity of 560,000 metric tons. This acquisition strengthens our position in the Midwest region of the U.S. and it is expected that it will contribute about US$12 million in EBITDA per year, excluding synergies. ------------------------------------------------------------------------------- Please refer to the end of this report for definition of terms, U.S. dollar translation methodology Page 3 and other important disclosures. Page 4 [GRAPHIC OMITTED]CEMEX Operating Results - Mexico -------------------------------------------------------------------------------- In Mexico, net sales were US$663 million, an increase of 5% versus the third quarter of 2002. Domestic gray cement volume increased 1% in the quarter and 4% for the first nine months of the year versus the comparable periods of last year. Weather was an important factor affecting cement demand, with unusually high precipitation levels in August and September, when compared to the same months of 2002. The main drivers of demand in Mexico continue to be infrastructure projects and low-income housing. CEMEX's average realized gray cement price in Mexico increased 2% in constant pesos versus the third quarter of 2002, and decreased 2% in dollar terms. The average ready-mix price remained flat in constant pesos and decreased 5% in dollar terms compared with the third quarter of 2002. The average cash cost of goods sold per metric ton decreased 16% in dollar terms versus the third quarter of 2002, mostly due to lower fixed costs, and the effect of the depreciation of the Mexican peso between September 2002 and September 2003. United States -------------------------------------------------------------------------------- Net sales for CEMEX's U.S. operations during the third quarter were US$471 million, a decrease of 1% compared to the year-earlier period. Domestic cement volume increased 3% during the third quarter of 2003 compared to the year-earlier period, while the ready-mix volume decreased 1%. The increase in cement volume was mainly due to pent up demand built during the previous quarter as a result of bad weather conditions in the Southeast, combined with strong sales in the Midwest. The residential sector continues to benefit from low interest rates, while spending on infrastructure remains stable, but at a low level. The average realized cement price decreased 2% versus the third quarter of 2002, while the average ready-mix price remained flat versus the same period a year ago. The average cash cost of goods sold per metric ton increased 3% versus the third quarter of 2002, due mainly to higher energy and insurance costs. Spain -------------------------------------------------------------------------------- Net sales for CEMEX Spain during the quarter were US$280 million, an increase of 25% versus the year-earlier period. Domestic cement volume increased 2% during the quarter compared to the same period a year ago. Ready-mix volume increased 9% for the quarter versus the year-earlier period. Our Spanish operations continue to benefit from the high level of construction activity in the country. Residential construction is at a high level, fueled by low interest rates, while infrastructure spending also remains at a high level due to Spain's infrastructure program. The average domestic cement price decreased 1% in euros and increased 13% in dollar terms compared to the year-earlier period. The average ready-mix price decreased 2% in euros and increased 13% in dollar terms versus the third quarter of 2002. The average cash cost of goods sold per metric ton increased 29% in dollar terms versus the third quarter of 2002. The increase in cash costs, when expressed in dollar terms, is due to the appreciation of the euro versus the U.S. dollar between September 2002 and September 2003. ------------------------------------------------------------------------------- Please refer to the end of this report for definition of terms, U.S. dollar translation methodology Page 3 and other important disclosures. Page 5 [GRAPHIC OMITTED] CEMEX Venezuela -------------------------------------------------------------------------------- Domestic cement volume for CEMEX's Venezuelan operations decreased 11% compared to the third quarter of 2002, while ready-mix volume decreased 6%. Cement demand from the self construction sector was strong during the quarter; however there is still limited investment in infrastructure Export volume from the company's Venezuelan operations during the third quarter increased 37% compared to the year-earlier period. The North America and Caribbean regions accounted for 66% and 34% of CEMEX Venezuela's third quarter exports, respectively. Domestic cement prices decreased 6% in constant Bolivar terms and increased 7% in dollar terms compared to the third quarter of 2002. During the third quarter of 2003, the average ready-mix price increased 5% in constant Bolivar terms, and increased 20% in dollar terms compared to the year-earlier period. The average cash cost of goods sold per metric ton increased 20% in dollar terms compared to the third quarter of 2002. The increase is due to major maintenance performed in one of our cement kilns during the quarter, whereas this maintenance did not occur in the third quarter of last year. Colombia -------------------------------------------------------------------------------- During the third quarter of 2003, domestic cement volume for the Company's Colombian operations increased 12%, while ready-mix volume increased 39% versus the year-earlier period. Private residential construction coupled with infrastructure investment in transportation have been the main drivers of cement and ready mix demand. The self construction sector is growing but at a low rate. CEMEX's average realized cement price in Colombia was 4% higher in Colombian pesos and 2% lower in dollar terms versus the third quarter of 2002. The average ready-mix price increased 5% in Colombian pesos and remained flat in dollar terms versus the year-earlier period. The average cash cost of goods sold per metric ton increased 42% in dollar terms versus the third quarter of 2002. The increase is due to major maintenance performed in one of our cement kilns during the quarter, whereas last year we did not perform major maintenance in our kilns. Other Operations -------------------------------------------------------------------------------- Net sales for our Central American and Caribbean operations increased 4% versus the third quarter of last year. The increase is mainly due to a strong performance of our operations in Panama, Costa Rica, and the incorporation of Puerto Rican Cement. Domestic cement volume remained flat versus the third quarter of last year, while Ready-mix volume increased 26% primarily due to higher volumes in al of our markets, as well as the incorporation of Puerto Rican Cement, which has sizeable ready mix operations and was included in the consolidated results for two months during the third quarter of 2002. In Egypt, net sales and domestic cement volume increased 9% and 1% respectively versus the third quarter of 2002. Investment in infrastructure remains as the main driver of demand, while spending in the commercial and tourism sectors remains at a low level. The average domestic cement price in Egypt increased 25% in Egyptian pounds and decreased 6% in dollar terms versus the third quarter of 2002. Our Asian operations, which include the Philippines, Thailand, Taiwan and Bangladesh, increased Net sales by 18% versus the third quarter of 2002, as all of our markets experienced an improvement in sales, while domestic cement volume decreased 5%. Our weighted average domestic cement prices in the region increased 18% in dollar terms versus the same period a year ago. Activity in the construction sector in the Philippines remains at a low level, driven mainly by decreased government spending in infrastructure. Cement demand was also affected during the quarter by a prolonged rainy season. ------------------------------------------------------------------------------- Please refer to the end of this report for definition of terms, U.S. dollar translation methodology Page 3 and other important disclosures. Page 6 [GRAPHIC OMITTED] CEMEX Consolidated Income Statement & Balance Sheet CEMEX S.A. de C.V. AND SUBSIDIARIES (Thousands of U.S. Dollars, except per ADR amounts) January - September Third quarter INCOME STATEMENT 2003 2002 % Var. 2003 2002 % Var. ----------------------------------------------------------------------------------------- ------------------------------------ Net Sales 5,288,249 4,938,219 7% 1,834,365 1,720,850 7% Cost of Sales (3,049,114) (2,718,974) 12% (1,043,323) (959,399) 9% ----------------------------------------------------------------------------------------- ------------------------------------ Gross Profit 2,239,135 2,219,245 1% 791,042 761,451 4% Selling, General and Administrative Expenses (1,143,973) (1,161,850) (2%) (386,320) (407,456) (5%) ----------------------------------------------------------------------------------------- ------------------------------------ Operating Income 1,095,162 1,057,395 4% 404,722 353,995 14% Financial Expenses (282,164) (246,360) 15% (93,588) (88,547) 6% Financial Income 13,953 38,662 (64%) 2,168 9,378 (77%) Exchange Gain (Loss), Net (140,138) (72,070) 94% (117,756) (5,620) 1995% Monetary Position Gain (Loss) 233,306 255,377 (9%) 68,313 83,067 (18%) Gain (Loss) on Marketable Securities (34,335) (324,448) (89%) 6,425 (246,704) N/A Total Comprehensive Financing (Cost) Income (209,379) (348,840) (40%) (134,438) (248,426) (46%) Other Expenses, Net (264,601) (281,004) (6%) (91,271) (73,894) 24% ----------------------------------------------------------------------------------------- ------------------------------------ Net Income Before Income Taxes 621,182 427,551 45% 179,012 31,675 465% Income Tax (75,047) (49,911) 50% (23,133) (3,718) 522% Employees' Statutory Profit Sharing (7,711) (8,876) (13%) (2,714) (3,528) (23%) Total Income Tax & Profit Sharing (82,759) (58,787) 41% (25,847) (7,246) 257% ----------------------------------------------------------------------------------------- ------------------------------------ Net Income Before Participation of Uncons. Subs. and Ext. Items 538,423 368,763 46% 153,165 24,429 527% Participation in Unconsolidated Subsidiaries 17,133 21,417 (20%) 3,138 9,281 (66%) Consolidated Net Income 555,556 390,180 42% 156,303 33,710 364% Net Income Attributable to Min. Interest 27,027 34,386 (21%) 16,072 17,191 (7%) MAJORITY INTEREST NET INCOME 528,529 355,794 49% 140,231 16,519 749% ----------------------------------------------------------------------------------------- ------------------------------------ EBITDA 1,572,962 1,504,406 5% 569,986 505,065 13% Earnings per ADR 1.69 1.20 41% 0.43 0.05 699% ----------------------------------------------------------------------------------------- ------------------------------------ As of September 30 BALANCE SHEET 2003 2002 % Var. --------------------------------------------------------------------------------------------------------------------------------- Total Assets 16,201,050 16,290,214 (1%) Cash and Temporary Investments 408,678 336,316 22% Trade Accounts Receivables 443,787 653,313 (32%) Other Receivables 466,098 423,745 10% Inventories 686,004 719,862 (5%) Other Current Assets 92,017 127,206 (28%) Current Assets 2,096,584 2,260,442 (7%) Fixed Assets 8,906,298 8,817,613 1% Other Assets 5,198,169 5,212,159 (0%) ------------------------------------------------------------------------------------------- Total 8,829,701 9,150,072 (4%) Liabilities Current 2,730,423 3,558,761 (23%) Liabilities Long-Term Liabilities 4,254,781 4,031,981 6% Other 1,844,497 1,559,330 18% Liabilities ------------------------------------------------------------------------------------------- Consolidated Stockholders' Equity 7,371,350 7,140,141 3% Stockholders' Equity Attributable to Minority Interest 1,173,812 1,210,705 (3%) Stockholders' Equity Attributable to Majority Interest 6,197,538 5,929,436 5% -------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------- Please refer to the end of this report for definition of terms, U.S. dollar translation methodology Page 3 and other important disclosures. Page 7 [GRAPHIC OMITTED] CEMEX Consolidated Income Statement & Balance Sheet CEMEX S.A. de C.V. AND SUBSIDIARIES (Thousands of Mexican Pesos in real terms as of September 31, 2003 except per ADR amounts) January - September Third quarter INCOME STATEMENT 2003 2002 % Var. 2003 2002 % Var. --------------------------------------------------------------------------------------------------------------------------------- Net Sales 58,170,737 54,334,489 7% 20,178,018 18,934,257 7% Cost of Sales (33,540,255) (29,916,465) 12% (11,476,558) (10,556,128) 9% ---------------------------------------------------------------------------------------------------------------------------------- Gross Profit 24,630,482 24,418,023 1% 8,701,460 8,378,129 4% Selling, General and Administrative Expenses (12,583,701) (12,783,665) (2%) (4,249,518) (4,483,170) (5%) ---------------------------------------------------------------------------------------------------------------------------------- Operating Income 12,046,781 11,634,359 4% 4,451,941 3,894,959 14% Financial Expenses (3,103,804) (2,710,661) 15% (1,029,466) (974,270) 6% Financial Income 153,482 425,392 (64%) 23,844 103,181 (77%) Exchange Gain (Loss), Net (1,541,519) (792,975) 94% (1,295,316) (61,833) 1995% Monetary Position Gain (Loss) 2,566,361 2,809,870 (9%) 751,440 913,970 (18%) Gain (Loss) on Marketable Securities (377,688) (3,569,856) (89%) 70,675 (2,714,451) N/A Total Comprehensive Financing (Cost) Income (2,303,168) (3,838,231) (40%) (1,478,823) (2,733,403) (46%) Other Expenses, Net (2,910,615) (3,091,849) (6%) (1,003,982) (813,041) 23% ---------------------------------------------------------------------------------------------------------------------------------- Net Income Before Income Taxes 6,832,999 4,704,279 45% 1,969,137 348,514 465% Income Tax (825,519) (549,168) 50% (254,468) (40,912) 522% Employees' Statutory Profit Sharing (84,825) (97,662) (13%) (29,850) (38,820) (23%) Total Income Tax & Profit Sharing (910,344) (646,830) 41% (284,318) (79,732) 257% ---------------------------------------------------------------------------------------------------------------------------------- Net Income Before Participation of Uncons. Subs. and Ext. Items 5,922,655 4,057,450 46% 1,684,819 268,782 527% Participation in Unconsolidated Subsidiaries 188,464 235,646 (20%) 34,513 102,119 (66%) Consolidated Net Income 6,111,119 4,293,095 42% 1,719,332 370,902 364% Net Income Attributable to Min. Interest 297,296 378,343 (21%) 176,792 189,146 (7%) MAJORITY INTEREST NET INCOME 5,813,823 3,914,753 49% 1,542,540 181,755 749% ---------------------------------------------------------------------------------------------------------------------------------- EBITDA 17,302,582 16,552,757 5% 6,269,844 5,557,154 13% Earnings per ADR 18.62 12.22 52% 4.77 0.55 760% ---------------------------------------------------------------------------------------------------------------------------------- As of September 30 BALANCE SHEET 2003 2002 % Var. ---------------------------------------------------------------------------------------------------------------------------------- Total Assets 178,211,555 179,238,809 (1%) Cash and Temporary Investments 4,495,457 3,700,438 21% Trade Accounts Receivables 4,881,656 7,188,303 (32%) Other Receivables 5,127,079 4,662,409 10% Inventories 7,546,044 7,920,537 (5%) Other Current Assets 1,012,183 1,399,624 (28%) Current Assets 23,062,419 24,871,311 (7%) Fixed Assets 97,969,278 97,018,886 1% Other Assets 57,179,858 57,348,613 (0%) ------------------------------------------------------------------------------------------- Total 97,126,708 100,676,900 (4%) Liabilities Current 30,034,653 39,156,526 (23%) Liabilities Long-Term Liabilities 46,802,590 44,363,294 5% Other 20,289,466 17,157,081 18% Liabilities ------------------------------------------------------------------------------------------- Consolidated Stockholders' Equity 81,084,848 78,561,908 3% Stockholders' Equity Attributable to Minority Interest 12,911,932 13,321,205 (3%) Stockholders' Equity Attributable to Majority Interest 68,172,915 65,240,704 4% -------------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------- Please refer to the end of this report for definition of terms, U.S. dollar translation methodology Page 3 and other important disclosures. Page 8 [GRAPHIC OMITTED] CEMEX Operating Summary per Country In thousands of U.S. dollars January - September Third quarter ----------------------- -------------------------- NET SALES 2003 2002 % Var. 2003 2002 % Var. ------------------------------------------------------------------------------------------------------------------------------- Mexico 1,975,647 1,844,118 7% 663,249 632,599 5% U.S.A. 1,272,641 1,344,018 (5%) 470,733 477,748 (1%) Spain 848,220 689,015 23% 279,953 224,425 25% Venezuela 223,085 214,857 4% 79,540 78,517 1% Colombia 153,758 135,390 14% 58,702 49,441 19% Egypt 93,296 110,867 (16%) 38,942 35,801 9% Central America & the Caribbean region 435,521 360,882 21% 151,403 146,084 4% Asia region 143,111 138,080 4% 45,214 38,362 18% --------------------------------------------------------------------------------------------------------------------------------- Others and intercompany eliminations 142,970 100,992 42% 46,629 37,873 23% --------------------------------------------------------------------------------------------------------------------------------- TOTAL 5,288,249 4,938,219 7% 1,834,365 1,720,850 7% ================================================================================================================================= GROSS PROFIT ---------------------------------------------------------------------------------------------------------------------------------- Mexico 1,141,710 1,097,079 4% 389,576 364,881 7% U.S.A. 397,605 479,102 (17%) 160,004 178,127 (10%) Spain 300,854 261,775 15% 93,160 86,153 8% Venezuela 103,366 103,718 (0%) 38,589 38,855 (1%) Colombia 83,335 73,737 13% 31,341 27,402 14% Egypt 40,274 43,220 (7%) 19,852 16,068 24% Central America & the Caribbean region 136,820 120,046 14% 49,822 46,604 7% Asia region 39,503 35,778 10% 12,434 7,314 70% ---------------------------------------------------------------------------------------------------------------------------------- Others and intercompany eliminations (4,334) 4,790 N/A (3,736) (3,953) (5%) ---------------------------------------------------------------------------------------------------------------------------------- TOTAL 2,239,135 2,219,245 1% 791,042 761,451 4% ================================================================================================================================== OPERATING INCOME ---------------------------------------------------------------------------------------------------------------------------------- Mexico 790,543 739,242 7% 272,050 241,165 13% U.S.A. 160,667 232,026 (31%) 73,971 87,727 (16%) Spain 186,042 168,040 11% 57,037 53,806 6% Venezuela 73,178 71,953 2% 28,205 28,065 0% Colombia 60,325 56,063 8% 23,854 21,312 12% Egypt 19,969 19,607 2% 11,953 8,247 45% Central America & the Caribbean region 74,463 74,373 0% 28,283 27,521 3% Asia region (8,893) (7,329) 21% (2,748) (7,156) (62%) ---------------------------------------------------------------------------------------------------------------------------------- Others and intercompany eliminations (261,132) (296,580) (12%) (87,882) (106,693) (18%) ---------------------------------------------------------------------------------------------------------------------------------- TOTAL 1,095,162 1,057,395 4% 404,722 353,995 14% ================================================================================================================================== EBITDA ---------------------------------------------------------------------------------------------------------------------------------- Mexico 896,330 835,305 7% 307,823 273,865 12% U.S.A. 270,650 337,197 (20%) 111,284 124,041 (10%) Spain 240,007 208,642 15% 75,863 67,534 12% Venezuela 108,735 102,866 6% 39,380 39,464 (0%) Colombia 91,729 82,113 12% 35,627 30,761 16% Egypt 41,698 48,549 (14%) 19,304 17,668 9% Central America & the Caribbean region 101,818 93,212 9% 37,347 35,705 5% Asia region 14,927 16,347 (9%) 5,074 478 962% ---------------------------------------------------------------------------------------------------------------------------------- Others and intercompany eliminations (192,931) (219,825) (12%) (61,715) (84,452) (27%) ---------------------------------------------------------------------------------------------------------------------------------- TOTAL 1,572,962 1,504,406 5% 569,986 505,065 13% ================================================================================================================================== ------------------------------------------------------------------------------- Please refer to the end of this report for definition of terms, U.S. dollar translation methodology Page 3 and other important disclosures. Page 9 [GRAPHIC OMITTED] CEMEX Operating Summary per Country As a percentage of net sales January - September Third quarter ------------------------- ------------------------- OPERATING INCOME MARGIN 2003 2002 2003 2002 ------------------------------------------------------------------------------------------------------------- Mexico 40.0% 40.1% 41.0% 38.1% U.S.A. 12.6% 17.3% 15.7% 18.4% Spain 21.9% 24.4% 20.4% 24.0% Venezuela 32.8% 33.5% 35.5% 35.7% Colombia 39.2% 41.4% 40.6% 43.1% Egypt 21.4% 17.7% 30.7% 23.0% Central America & the Caribbean region 17.1% 20.6% 18.7% 18.8% Asia region (6.2%) (5.3%) (6.1%) (18.7%) ------------------------------------------------------------------------------------------------------------- CONSOLIDATED MARGIN 20.7% 21.4% 22.1% 20.6% ============================================================================================================= EBITDA MARGIN ------------------------------------------------------------------------------------------------------------- Mexico 45.4% 45.3% 46.4% 43.3% U.S.A. 21.3% 25.1% 23.6% 26.0% Spain 28.3% 30.3% 27.1% 30.1% Venezuela 48.7% 47.9% 49.5% 50.3% Colombia 59.7% 60.6% 60.7% 62.2% Egypt 44.7% 43.8% 49.6% 49.4% Central America & the Caribbean region 23.4% 25.8% 24.7% 24.4% Asia region 10.4% 11.8% 11.2% 1.2% ------------------------------------------------------------------------------------------------------------- CONSOLIDATED MARGIN 29.7% 30.5% 31.1% 29.3% ============================================================================================================= ------------------------------------------------------------------------------- Please refer to the end of this report for definition of terms, U.S. dollar translation methodology Page 3 and other important disclosures. Page 10 [GRAPHIC OMITTED] CEMEX VOLUME SUMMARY Consolidated volume summary Cement: Thousands of metric tons Ready-mix: Thousands of cubic meters January - September Third quarter ----------------------------- --------------------------- 2003 2002 % Var. 2003 2002 % Var. --------------------------------------------------------------------------------------------------------------------------------- Consolidated cement volume 48,466 46,216 5% 16,851 15,974 5% Consolidated ready-mix volume 16,205 14,322 13% 5,568 5,046 10% --------------------------------------------------------------------------------------------------------------------------------- Per-Country Volume Summary January - September Third quarter -------------------- Third quarter 2003 Vs. DOMESTIC CEMENT VOLUME 2003 Vs. 2002 2003 Vs. 2002 Second quarter 2003 ------------------------------------------------------------------------------------------------------------------------ Mexico 4% 1% (3%) U.S.A. (1%) 3% 7% Spain 5% 2% (8%) Venezuela (23%) (11%) 8% Colombia 4% 12% 21% Egypt (9%) 1% 10% Central America & the Caribbean region 15% 0% (8%) Asia Region 1% (5%) (15%) ------------------------------------------------------------------------------------------------------------------------- READY-MIX VOLUME ------------------------------------------------------------------------------------------------------------------------- Mexico 14% 10% (1%) U.S.A. 3% (1%) (7%) Spain 6% 9% 2% Venezuela (16%) (6%) (6%) Colombia 35% 39% 31% Central America & the Caribbean region 129% 26% (1%) Asia Region N/A N/A N/A ------------------------------------------------------------------------------------------------------------------------- EXPORT CEMENT VOLUME ------------------------------------------------------------------------------------------------------------------------- Mexico (26%) (35%) (11%) Spain (19%) (39%) (19%) Venezuela 17% 37% (11%) ------------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------- Please refer to the end of this report for definition of terms, U.S. dollar translation methodology Page 3 and other important disclosures. Page 11 [GRAPHIC OMITTED] CEMEX PRICE SUMMARY Third quarter 2003 Vs. Third quarter 2003 Vs. 2002 Second quarter 2003 -------------------------------------- ---------------------------------- % Var. % Var. % Var. % Var. DOMESTIC CEMENT PRICE U.S. dollar Local currency U.S. dollar Local currency --------------------------------------------------------------------------------------------------------------------------- Mexico (1) (2%) 2% (5%) (1%) U.S.A. (2%) (2%) (1%) (1%) Spain 13% (1%) (2%) (1%) Venezuela (1) 7% (6%) 1% (4%) Colombia (2%) 4% (1%) (1%) Egypt (6%) 25% 6% 9% Central America & the Caribbean region (2) 1% N/A 7% N/A Asia Region (2) 18% N/A 6% N/A --------------------------------------------------------------------------------------------------------------------------- READY-MIX PRICE --------------------------------------------------------------------------------------------------------------------------- Mexico (1) (5%) (0%) (3%) 1% U.S.A. 0% 0% (0%) (0%) Spain 13% (2%) (5%) (4%) Venezuela (1) 20% 5% 4% (1%) Colombia (0%) 5% 1% 2% Central America & the Caribbean region (2) (6%) N/A (1%) N/A Asia Region (2) (10%) N/A 3% N/A --------------------------------------------------------------------------------------------------------------------------- 1) Local currency price variation for Mexico and Venezuela is presented in constant currency terms as of September 30, 2003. 2) Volume weighted-average price. ------------------------------------------------------------------------------- Please refer to the end of this report for definition of terms, U.S. dollar translation methodology Page 3 and other important disclosures. Page 12 [GRAPHIC OMITTED] CEMEX Definition of Terms and Disclosures ------------------------------------------------------------------------------- Methodology for consolidation and presentation of results CEMEX consolidates its results in Mexican pesos under Mexican generally accepted accounting principles. For the convenience of the reader, U.S. dollar amounts for the consolidated entity are calculated by converting the constant-Mexican peso amounts at the end of each quarter using the end of period Mexican peso/U.S. dollar exchange rate for each quarter. The exchange rates used to convert results for the third quarter of 2003, second quarter of 2003 and third quarter of 2002 are 11.00, 10.46 and 10.22 Mexican pesos per 1 U.S. dollar, respectively. CEMEX's weighted average inflation factor between September 30, 2002 and September 30, 2003 was 7.66%. Per-country figures are presented in U.S. dollars for the convenience of the reader. In the consolidation process, each country's figures are converted to U.S. dollars (except CEMEX Mexico) and then to Mexican pesos under Mexican generally accepted accounting principles. Each country's figures presented in U.S. dollars at September 30, 2003 and September 30, 2002 can be converted to its original local currency amount by multiplying the U.S. dollar figure by the corresponding exchange rate provided below. To convert September 30, 2002 U.S. dollar figures for Mexico and Venezuela to constant pesos and bolivars, respectively, as of September 30, 2003 it is necessary to first convert the September 30, 2002 U.S. dollars to the corresponding local currency (using the exchange rates provided below), and then multiply the resulting amount by the inflation rate factor provided in the table below. September 30 ---------------------------- Inflation rate Exchange rate 2003 2002 factor ------------------------------------------------------------------------------- Mexico 11.00 10.22 1.040 Spain 0.86 1.01 Venezuela 1,600 1,474 1.290 Colombia 2,889 2,828 Egypt 6.16 4.64 ------------------------------------------------------------------------------- The Central America & Caribbean region includes CEMEX's operations in Costa Rica, the Dominican Republic, Panama, Nicaragua and Puerto Rico, as well as our trading operations in the Caribbean region. The Asia region includes CEMEX's operations in the Philippines, Taiwan, Thailand and Bangladesh. CEMEX's quarterly reports before 2003 consolidated CEMEX's operations in Panama and the Dominican Republic into Venezuela. Beginning in 2003, CEMEX's Venezuelan operations do not include Panama and the Dominican Republic for presentation purposes, but are now consolidated into the Central America & Caribbean region. For comparison purposes, Venezuela's and Central America & Caribbean region's figures for 2002 were restated to make them comparable with the new disclosure procedures. Definition of terms EBITDA. Equals operating income plus depreciation and operating amortization. Free cash flow. Equals EBITDA minus net interest expense, capital expenditures, change in working capital, taxes paid, dividends on preferred equity, and other cash items. Capital expenditures. Maintenance spending on our cement and ready mix businesses, and expansion of current facilities of cement and ready mix. Equity obligations. Equal the outstanding US$650 million balance of preferred equity plus the outstanding US$66 million of preferred capital securities. Net debt. Equals total debt plus equity obligations, minus cash and cash equivalents. Interest plus preferred dividend coverage. Is calculated by dividing EBITDA for the last twelve months by the sum of interest expense and preferred dividend payments for the last twelve months (all amounts in constant currency terms). Net debt/EBITDA. Is calculated by dividing net debt at the end of the quarter by EBITDA for the last twelve months (EBITDA in constant currency terms). Capitalization ratio. Is calculated by dividing the sum of total debt, the US$66 million outstanding preferred capital securities, and the present value of the forward agreements put in place to hedge our warrant obligations by the sum of total debt, the US$66 million outstanding preferred capital securities, the present value of the forward agreements put in place to hedge our warrant obligations and consolidated stockholders' equity. Earnings per ADR For the calculation of earnings per ADR, the number of average ADRs outstanding used was as follows: 323.3 million for the third quarter of 2003 and 304.2 million for the third quarter of 2002; 312.3 million for the first nine months of 2003, and 297.5 million for the first nine months of 2002. ------------------------------------------------------------------------------ Please refer to the end of this report for definition of terms, U.S. dollar translation methodology Page 3 and other important disclosures. Page 13 EXHIBIT 2 Media Relations Investor Relations Analyst Relations Jorge Perez Abraham Rodriguez Jose Antonio Gonzalez (52 81) 8888-4334 (52 81) 8888-4262 (212) 317-6008 CEMEX Bulding the future (TM) CEMEX ANNOUNCES NON-DILUTIVE EQUITY OFFERING MONTERREY, MEXICO, October 1, 2003 - CEMEX, S.A. de C.V. (NYSE: CX) announced today that it and certain selling ADS holders intend, subject to market and other conditions, to commence a public offering of 25.5 million of its American Depositary Shares plus up to an additional 15% of that amount to cover over-allotments. This transaction will not increase the number of shares outstanding and thus will not dilute existing shareholders. Citigroup Global Markets Inc. will act as global coordinator for the offering. The ADSs are being offered in connection with the unwinding of several forward contracts entered into between certain banks, including the selling ADS holders, and CEMEX. The selling ADS holders will receive the proceeds of the ADSs being sold by them in the offering, and have agreed to apply such proceeds against amounts CEMEX is obligated to pay under their forward contracts. The selling ADS holders have also agreed to remit to CEMEX any proceeds they receive from the offering in excess of the amount necessary to satisfy CEMEX's obligations under these forward contracts. As of September 30, 2003, the aggregate amount payable by CEMEX to the selling ADS holders under their forward contracts was approximately U.S.$450 million. The proceeds of the sales of the ADSs being offered by CEMEX will be applied against amounts CEMEX is obligated to pay under other forward contracts, with any excess due to CEMEX. Subject to market conditions, CEMEX intends to use a portion of the net proceeds available to it to conduct a cash tender offer for all or a portion of its outstanding appreciation warrants, including appreciation warrants represented by American Depositary Warrants (NYSE: CX.WSB). However, CEMEX is under no obligation to proceed with the appreciation warrant tender offer. CEMEX intends to use the remaining portion of the net proceeds available to it from the offering for general corporate purposes, including the repayment of debt. Rodrigo Trevino, Chief Financial Officer, said: "This non-dilutive equity offering is in line with our objectives and stated financial strategy. We believe this is an important step and one of several that we have taken during the course of the year to simplify our capital structure." Shelf Registration Statements relating to these securities have been filed with the Securities and Exchange Commission and are effective. This announcement shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. The offering is made solely by prospectus. Copies of the prospectus supplement and prospectus, when available, may be obtained from the Prospectus department of Citigroup Global Markets Inc. at the following address: Brooklyn Army Terminal 140 58th Street Brooklyn, NY 11220 Tel: (718) 765-6732 Fax: (718) 765-6734 CEMEX is a leading global producer and marketer of cement and ready-mix products, with operations primarily concentrated in the world's most dynamic cement markets across four continents. CEMEX combines a deep knowledge of the local markets with its global network and information technology systems to provide world-class products and services to its customers, from individual homebuilders to large industrial contractors. For more information, visit www.cemex.com. This press release contains forward-looking statements and information that are necessarily subject to risks, uncertainties and assumptions. The proposed ADS offering and cash tender offer for the appreciation warrants are dependent upon market conditions, which are subject to change. In addition, 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, 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.