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UPDATE 4-Mexico's Cemex eyes new debt issue, resumes guidance
October 4, 2012 / 1:52 PM / in 5 years

UPDATE 4-Mexico's Cemex eyes new debt issue, resumes guidance

* Company recently wrapped up refinancing with lenders

* Shares jump in Mexico, New York

* Eyes new debt issue; IFR says books approach $5 bln

MEXICO CITY, Oct 4 (Reuters) - Mexican cement maker Cemex issued its first results guidance in more than three years on Thursday as it prepares to tap debt markets again with a note placement, propelling its shares to 20-month highs.

Cemex, which last provided a results outlook in February 2009, forecast third-quarter earnings before interest, taxes, depreciation and amortization (EBITDA) would rise 9 percent from a year earlier in dollar terms. Quarterly sales are seen down 2 percent.

The Monterrey-based company also said it is eyeing a private debt placement but provided no details. According to IFR, books for the new, senior 10-year notes approached $5 billion and have closed. Final pricing is expected later on Thursday

Fitch agency rated the proposed notes “B+”, with a stable outlook.

“Fitch expects Cemex’s leverage to remain high through the end of 2014,” the agency wrote in a report. “A recovery of the company’s U.S. operations is crucial to generating free cash flow in excess of $1 billion annually and lowering leverage.”

Cemex recently wrapped up a $7.2 billion refinancing that gave it much needed breathing room to push back looming debt payments for up to four years.

The company was swamped by the 2008 U.S. housing meltdown shortly after paying out $16 billion to buy Australian peer Rinker. It has been working its way out of deep debt obligations for the past three years.

Cemex is due to report full quarterly results later this month. Its shares rose 4.2 percent to 11.40 pesos Thursday noon. Its New York-traded shares gained 4.8 percent at $8.97.

As part of the refinancing agreement with lenders, the company, which has operations in more than 50 countries, swapped debt and has committed to pay down $1 billion in March 2013. It also revised some financial covenants.

Cemex is also close to listing its Cemex Latam Holdings unit in Colombia, a deal that could bring in $750 million to $1 billion to help it meet the payment next March.

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