Cemex signals cuts of US$22m to Caribbean projects
Mexican construction giant Cemex, the ultimate owner of Caribbean Cement Company in Jamaica, announced plans to review over US$22 million in regional projects, amid pay cuts.
The company expects reduced demand arising from the ongoing COVID-19 pandemic and is cutting back on spending.
“We expected to make capital expenditures of US$22 million during 2020 in Caribbean TCL. As of the date of this annual report, the expected capital expenditures to be made in our operations in the Caribbean TCL during 2020 are under review as a result of measures taken by Cemex to mitigate potential risks posed by the spread of COVID-19,” stated Cemex in its report released this month.
Cemex’s Caribbean capex has been declining over the past three years, from US$32 million in 2017 to US$29 million in 2018, and US$21 million in 2019.
The report did not disaggregate the budgeted capex in the country markets operated under Trinidad Cement Limited.
Caribbean Cement Company meanwhile was vague about its ongoing plant upgrade programme, choosing to skirt the implications for the Rockfort project.
“We aim to transform this factory into a state-of-the-art one, placing it among best in class in the region. However, during these extraordinary circumstances we are optimising our resources ad postponing all non-essential expenses,” the company said.
The adjustments being made by Cemex also affect its other markets in the region, including temporary shutdowns in several jurisdictions.
“In most of Cemex’s South America, Central America and Caribbean region, the company’s operations have been temporarily affected. As a result of different regulations, Cemex operations in Trinidad & Tobago, Barbados and Panama have been temporarily halted in most of its operations,” the construction company said.
Caribbean Cement did not respond to requests for comment on what elements of its operations would be affected.
Last year, TCL contributed US$248 million of Cemex’s US$14.5 billion group revenue. That’s down from US$254 million of revenue for TCL in 2018 and group revenue of US$15.4 billion for Cemex.
Cemex executives have agreed to take a 25 per cent pay cut from May to July; board members have been asked to give up 15 per cent of their compensation; and workers 10 per cent, with “the deferred amount to be paid in full during December 2020”.