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“In Harmony With Nature”
Growth with Responsibility
May 17, 2002
CONTENT
• BRIEF HISTORY OF CEMEX
• SUSTAINABLE DEVELOPMENT STARTEGY
• OUR MILESTONES
Brief history of CEMEX
Founded in 1906
In 1985 total sales of 300 million US dlls.
The globalization started in 1992, with the acquisition of two
companies in Spain reaching 2.2 billion US dlls. in sales
2001 Global sales of $6.9 billon US dlls.
Operations in more than 30 countries
One of the world’s three largest cement producers
Production capacity of 80 MMT/A
More than 25,500 employees
Commercial relations with more than 60 countries
1906 80
Cementos MMT/A
2000-01
1920 Hidalgo Acq: US (Southdown),
MEXICO THAILAND 1999 65
Cem. Acq: EGYPT, COSTA MMT/A
Portland RICA, BANGLADESH
Monterrey Part: CHILE
1931 1997-98
Acq: PHILIPPINES,
Fusion: INDONESIA
Cementos 60 9 1995 -96
Mexicanos years HISTORICAL years Acq: COLOMBIA
DOM. REP.
1947 EVOLUTION 1994
Cementos Acq: US, PANAMA,
del Norte 21 5 VENEZUELA
years years
1992
1.1 1966 Acq: SPAIN 36
MMT/A Acq: Cem. MMT/A
Maya 1990
1973 Yaqui plant
Torreón and 1989
Valles plant Acq: Cem. 1976 1987 Acq: Cem. 22
del Bajío Acq: Cem. 1986
Huichapan Acq: Cem. Tolteca MMT/A
Guadalajara plant Aháhuac
15
Part: Cem MMT/A
Chihuahua
CAPACITY AND GEOGRAPHIC DISTRIBUTION
CAPACITY IN MM TON/YEAR GEOGRAPHIC DISTRIBUTION
100%
79 80
80%
65
57 60%
50 51
45 47
36 38 40%
22 23 24
20%
15 15
11
0%
86 87 88 89 90 91 92 93 94 95 96 97 98 99 '00 '01 91 92 93 94 95 96 97 98 99 '00 '01
Mexico Europe Americas Asia Africa
BUSINESS STRATEGY
In the late 80’s CEMEX decided to concentrate in
cement and to be a global company
To protect the core business in Mexico
Increasing production capacity
Acquiring market share through acquisitions
Taking positions in competitor’s markets
Transforming marginal business into part of the core
business
• To position itself as an International Competitor
Analyzing possible acquisitions outside Mexico
To develop the cement trading business
1906 80
Cementos MMT/A
2000-01
1920 Hidalgo Acq: US (Southdown),
MEXICO THAILAND 1999 65
Cem. Acq: EGYPT, COSTA MMT/A
Portland RICA, BANGLADESH
Monterrey Part: CHILE
1931 1997-98
Acq: PHILIPPINES,
Fusion: INDONESIA
Cementos 60 9 1995 -96
Mexicanos years HISTORICAL years Acq: COLOMBIA
DOM. REP.
1947 EVOLUTION 1994
Cementos Acq: US, PANAMA,
del Norte 21 5 VENEZUELA
years years
1.1 1992
MMT/A Acq: SPAIN 36
1966
1990 MMT/A
Acq: Cem.
1973 Yaqui plant
Maya
1989
Torreón and Acq: Cem. 22
Valles plant del Bajío 1976 1986 1987 Acq: Cem.
Acq: Cem. Huichapan Acq: Cem. Tolteca MMT/A
Guadalajara plant Aháhuac 15
Part: Cem MMT/A
Chihuahua
KEY ELEMENTS OF THE BUSINESS
STRATEGY
• Focusing the company as a low cost producer
• Deep knowledge of cement production technology
• Search for best management practices through internal
support groups
• Development of a learning process and continuous
improvement for acquisitions
• Proactive commitment to comply with all environmental
regulations in the countries in which we operate
CEMEX packages best practices in all disciplines to
ensure standardization, and a fast return on investment
ACQUISITIONS PROCESS
Management as
Identification of Post-Merger
Due Diligence a CEMEX
acquisition Target integration
business
New organization
design
2-3 weeks 6-12 months
Objective
Fast integration as a Fast Return on
CEMEX business Investment
SUSTAINABLE DEVELOPMENT STRATEGY
In 1994, we formalized our Sustainable
Development Strategy with 3 principles:
• Employ cutting-edge Technology in our operational
processes in order to assure energy-efficiency and the
optimized use of raw materials;
• Promote a culture of Environmental, Health, and
Safety Awareness within the company and the
community, in accordance with our principle that “We
take care of those things we know”;
• Use the most Effective Equipment and Systems to
protect our people, neighbors, environment and
equipment.
MILESTONES
• EHS Corporate Policy
• Health Awareness
• Safety Management System
• EHS DD and PMI Process
• CEMEX Ecoefficiency Program (CEP)
• Environmental Culture and Conservation
Programs
• Public Information
These Milestones are our guiding principles in CEMEX´s
Sustainable Development efforts
MILESTONES
EHS Corporate Policy
•In 1993, we established our first Environmental
Policy, which was implemented in all of our
operations around the world.
•This policy was updated in 1997 to include
Safety and Health.
•Periodic revisions are conducted by our EHS
Steering Committee.
MILESTONES
Health Awareness
• HEALTH PROMOTION
• STRESS CONTROL PROGRAM
• MEDICAL CHECK UP’S
• TRAVEL MEDICINE
• VACCINATION PROGRAM
MILESTONES
Safety Management System
ON-LINE GLOBAL DATA SYSTEM
CORPORATE SAFETY MANUAL
“JUST ONE DAY WITHOUT
ACCIDENTS;
TODAY”
CEMEX SAFETY AWARDS SAFETY CULTURE PROMOTION
MILESTONES
EHS DD and PMI process
After a new acquisition, Post Merger Integration (PMI) is initiated.
The objective is to increase the levels of Ecoefficiency in the new
company. Providing immediate benefits for the company and the
communities and countries where we operate.
PMI ACTION
Pre-existing
condition
CEMEX Ecoefficiency Program (CEP)
In 1994, We formally launched the Ecoefficiency
Program to optimize the consumption of raw materials
and energy by these actions:
•Developing and implementing Technology and innovative practices for
new plant design and production processes to reduce the use of energy
•Selective mining techniques and optimal quarry operation and recovery
•Recycling and reuse of production process materials
•Use of alternative raw materials from other industries
(Industrial Ecology)
•Use of natural cementing materials (pozzolana)
•Use of alternative fuels
•Promote Ecoefficiency Culture
MILESTONES
The following table shows the economic
savings of the CEP during 2001:
MM USD
Optimized use of energy : 3.62
Optimized use of materials and natural
resources (including water) 5.40
Use of alternative fuels and wastes : 4.60
Reduction of emissions and wastes : 1.44
Office paper recycling : 0.04
Total: 15.10
Since 1994, the estimated economic benefits total more than
US$ 75 million.
Summary: Optimization of the original design of the clinker cooler at kiln
OPTIMIZATION OF no. 3, in order to increase production and reduce the system’s
CLINKER COOLER maintenance, emissions, and thermal consumption. This optimization
DESIGN. allows to have higher operating performance and lower emissions from the
SOLID PLANT system.
Background
• Optimization of the clinker cooler’s original
design would increase production and
reduce maintenance and operational
costs, atmospheric emissions and fuel
consumption in the system
• The outlet temperature from the clinker
cooler was 20% higher than optimal
operation
Benefits
Increased clinker production by 6%, from
3,300 to 3,500 metric tons per day
Conclusion: By investing US$ 430,000 in the
Reduction of specific thermal optimization of the original clinker cooler
consumption at the kiln by 30 kcal/Kg design, the plant has reduced energy
clinker, representing 34,492 Gcal/year consumption and emissions, saving the
Reduction of maintenance costs company US$ 350,000 per year
Reduction of 33,000 metric tons of
CO2 per year
CEMEX MEXICO
NEW CEMEX
Summary: Design, manufacture and install CEMEX calciner
TECHNOLOGY FOR
BURNING 100% technology to burn 100% petroleum coke in the calcination
PETROLEUM COKE system of kiln no. 4. This technology has enabled the company to be
AT TORREON PLANT in the forefront of using solid fuels.
Background
• Because of its proven ability to absorb
sulphur during normal production processes,
the cement industry has become one of the
most environmentally secure destinations for
petcoke.
• Modifications necessary to complete the
project include changes in the preheater’s
heat-exchange system, calciner, tertiary air
ductwork, induced draft fans, and controls.
Benefits
Increased clinker production by 15.7% - from
2,550 to 2,950 metric tons per day- without
expanding plant capacity
Reduction of specific thermal consumption at
Conclusion: By investing US$ 1.6 million to
the kiln by 11.3% -from 885 to 785 kcal/Kg
burn 100% petroleum coke in its calcination
clinker- representing 96,907 Gcal/year
process, CEMEX has reduced energy
Reduction of specific power consumption at consumption and emissions, saving the
the kiln by 13.7% -from 46 to 39 Kw-h/Kg company US$ 2.3 million per year in kiln no. 4
clinker- representing 6,105,172 Mw-h/year
Reduction of 15,000 metric tons of CO2 per
year
Tepeaca Plant - Mexico
Pertigalete Plant - Venezuela
San Vicente Plant - Spain
Caracolito Plant - Colombia
Solid Cement Plant - Philippines
MILESTONES
Environmental Culture
Conservation
Books
MILESTONES
Environmental Culture
Nature’s Best & CEMEX
International
Photography Awards Ceremony
Smithsonian National Museum
of Natural History
MILESTONES
Conservation Programs
El Carmen Project
– Research studies and restoration actions
– Reintroduction of the Desert Big Horn Sheep
– Monitor and Manage the Black Bear population
Santa María Experimental Field
Gulf of California
El Carmen Project
Research studies and restoration actions
Reintroduction of the Desert Big Horn Sheep
Monitor and Manage the Black Bear population
Santa María Experimental Field
Academic and
Community Programs
Before
After
Business Meetings in Natural Environments
Habitat and Wildlife
Restoration Programs
Gulf of California Program
Partnership with Conservation
International to protect the USA
Marine Biodiversity of this region
Mexico
MILESTONE
Public Information:
EHS Reports in web site.
1994
2001
“In Harmony with Nature”
This concept guides our activities and provides a
template for our day to day work. Our many
initiatives and great success in Ecoefficiency
help to fund our efforts in Social Responsibility.
Together, these two elements help us to strike the
right balance and to work in “Harmony with
Nature”
