building a STRONGER foundation - Cemex

CEMEX, S.A.B. DE C.V. AND SUBSIDIARIES
Notes to the Consolidated Financial Statements – (Continued)
As of December 31, 2010, 2009 and 2008
(Millions of Mexican pesos)
On April 23, 2009, stockholders at the annual ordinary stockholders’ meeting approved resolutions to increase the variable common stock
through the capitalization of retained earnings, issuing up to 1,004 million shares (335 million CPOs) based on a price of Ps13.07 per CPO.
Stockholders received 3 new shares for each 75 shares held (1 new CPO for each 25 CPOs held), through the capitalization of retained
earnings. As a result, shares equivalent to approximately 334 million CPOs were issued, representing an increase in common stock of
approximately Ps3, considering a nominal value of Ps0.00833 per CPO, and additional paid-in capital of approximately Ps4,370. In addition,
stockholders approved resolutions to cancel the corresponding shares held in CEMEX’s treasury. There was no cash distribution and no
entitlement to fractional shares.
On April 24, 2008, stockholders at the annual ordinary stockholders’ meeting approved resolutions to: (i) create a reserve for share
repurchases of up to Ps6,000; and (ii) increase the variable common stock through the capitalization of retained earnings of up to Ps7,500,
issuing up to 1,500 million shares (500 million CPOs), based on a price of Ps23.92 pesos per CPO or instead, stockholders could have chosen
to receive a cash dividend of US$0.0835 per CPO (approximately Ps0.8677 pesos for each CPO considering the exchange rate of Ps10.3925
per dollar). As a result, shares equivalent to approximately 284 million CPOs were issued, representing an increase in common stock of
approximately Ps2, considering a nominal value of Ps0.00833 per CPO, and additional paid-in capital of approximately Ps6,792, while a cash
dividend payment was made for approximately Ps214. In addition, stockholders approved the cancellation of the corresponding shares held in
CEMEX’s treasury.
The CPOs issued pursuant to the exercise of options under the “Fixed program” (note 17A) generated additional paid-in capital of
approximately Ps5 in 2010, Ps5 in 2009 and Ps4 in 2008, and increased the number of shares outstanding. Likewise, in connection with the
long-term compensation program (note 17) in 2010 and 2009, CEMEX issued approximately 25.7 and 13.7 million CPOs, generating an
additional paid-in capital of approximately Ps312 and Ps163, respectively, associated with the fair value of the compensation received by
executives.
B) OTHER EQUITY RESERVES
As of December 31, 2010 and 2009, the balance of other equity reserves is summarized as follows:
2010 2009
Cumulative translation effect, net of effects from perpetual debentures and deferred income
taxes recognized directly in equity (notes 15B and 16D) 1 ..........................................................Ps 19,197 26,700
Issuance of convertible securities 2.................................................................................................... 3,203 1,971
Treasury shares held by subsidiaries ................................................................................................. (220) (187)
Ps 22,180 28,484
1 In 2010, includes a gain of approximately Ps5,401, resulting from the exchange of perpetual debentures (note 12A).
2 Represents the equity components associated with the issuances of convertible securities into shares of CEMEX, S.A.B. de C.V. described in note 12A.
Upon mandatory or voluntary conversion of these securities, these balances will be correspondingly reclassified to common stock and/or additional paid-in
capital.
For the years ended December 31, 2010, 2009 and 2008, the translation effects of foreign subsidiaries included in the statement of changes in
stockholders’ equity were as follows:
2010 2009 2008
Foreign currency translation adjustment 1.........................................................Ps 6,123 (17,716) 106,190
Foreign exchange fluctuations from debt 2........................................................ 1,886 2,158 (9,407)
Foreign exchange fluctuations from intercompany balances 3 .......................... (20,059) 14,654 (65,796)
Ps (12,050) (904) 30,987
1 These effects refer to the result from the translation of the financial statements of foreign subsidiaries.
2 Generated by foreign exchange fluctuations over a notional amount of debt in CEMEX, S.A.B. de C.V. associated with the acquisition of foreign
subsidiaries and designated as hedge of the net investment in foreign subsidiaries. The average amount of such debt was approximately US$2,829 in 2010,
US$3,200 in 2009 and US$3,656 in 2008.
3 Refers to foreign exchange fluctuations arising from balances with related parties in foreign currencies that are of a long-term investment nature considering
that their liquidation is not anticipated in the foreseeable future, of which a loss of Ps4,857 in 2008 was recognized in CEMEX, S.A.B. de C.V.
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