Cemex SAB (CEMEXCPO), the largest cement maker in the Americas, will expand capacity at a Texas plant by about 60 percent as it seeks to meet “rapidly growing demand” in the west of the state, led by oil and gas producers.
Capacity at the plant in Odessa, Texas, will increase by 345,000 metric tons to almost 900,000 metric tons, the Monterrey, Mexico-based company said in a statement today.
“We look forward to remaining a top cement provider to the oil and gas industry as well as supporting the region’s growth in infrastructure and residential construction,” Karl Watson Jr., president of Cemex’s U.S. unit, said in the statement.
The plant will add to Cemex’s output in its largest foreign market as the company seeks to boost U.S. sales after first-quarter cement volumes fell in Mexico, the rest of Latin America and Europe. Cemex’s U.S. unit posted its fourth straight profit before interest, taxes, depreciation and amortization in the first three months of the year, as it raised prices in several states.
The Texas plant expansion “is a sign that things are advancing very well in terms of demand,” Carlos Hermosillo, an analyst at Grupo Financiero Banorte SAB, said in a telephone interview from Mexico City. Hermosillo has a buy rating.
Cemex climbed 2.9 percent to 14.79 pesos at the close in Mexico City, before its announcement on adding capacity in Texas. Shares have climbed 21 percent this year.
To contact the reporter on this story: Brendan Case in Mexico City at email@example.com
To contact the editor responsible for this story: Ed Dufner at firstname.lastname@example.org