building a STRONGER foundation - Cemex

As part of our Global Cost-Reduction Program we have made temporary capacity adjustments and rationalizations in four of our
cement plants in Mexico. In addition, in 2010, we closed approximately 6% of our production capacity in our ready-mix plants
throughout Mexico.
Capital Expenditures. We made capital expenditures of approximately U.S.$497 million in 2008, U.S.$84 million in 2009 and
U.S.$87 million in 2010 in our operations in Mexico. We currently expect to make capital expenditures of approximately U.S.$84
million in our operations in Mexico during 2011.
Our Operations in the United States
Overview. Our operations in the United States represented approximately 17% of our net sales in Peso terms, before
eliminations resulting from consolidation, and approximately 43% of our total assets, for the year ended December 31, 2010. As of
December 31, 2010, we held 100% of CEMEX, Inc., the main holding company of our operating subsidiaries in the United States.
As of December 31, 2010, we had a cement manufacturing capacity of approximately 17.2 million tons per year in our
operations in the United States, including nearly 1.2 million tons in proportional interests through non-controlling holdings. As of
December 31, 2010, we operated a geographically diverse base of 13 cement plants located in Alabama, California, Colorado, Florida,
Georgia, Kentucky, Ohio, Pennsylvania, Tennessee and Texas. As of that date, we also had 46 rail or water served active cement
distribution terminals in the United States. As of December 31, 2010, we had 326 ready-mix concrete plants located in the Carolinas,
Florida, Georgia, Texas, New Mexico, Nevada, Arizona, California, Oregon and Washington and aggregates facilities in North
Carolina, South Carolina, Arizona, California, Florida, Georgia, New Mexico, Nevada, Oregon, Texas, and Washington, not including
the assets of Ready Mix USA LLC, as described below.
On July 1, 2005, we and Ready Mix USA, a privately owned ready-mix concrete producer with operations in the southeastern
United States, established two jointly-owned limited liability companies, CEMEX Southeast, LLC, a cement company, and Ready
Mix USA LLC, a ready-mix concrete company, to serve the construction materials market in the southeast region of the United States.
Under the terms of the limited liability company agreements and related asset contribution agreements, we contributed two cement
plants (Demopolis, Alabama and Clinchfield, Georgia) and 11 cement terminals to CEMEX Southeast, LLC, then representing
approximately 98% of its contributed capital, while Ready Mix USA contributed cash to CEMEX Southeast, LLC, then representing
approximately 2% of its contributed capital. In addition, we contributed our ready-mix concrete, aggregates and concrete block assets
in the Florida panhandle and southern Georgia to Ready Mix USA LLC, then representing approximately 9% of its contributed
capital, while Ready Mix USA contributed all its ready-mix concrete and aggregates operations in Alabama, Georgia, the Florida
panhandle and Tennessee, as well as its concrete block operations in Arkansas, Tennessee, Mississippi, Florida and Alabama to Ready
Mix USA LLC, then representing approximately 91% of its contributed capital. We own a 50.01% interest, and Ready Mix USA owns
a 49.99% interest, in the profits and losses and voting rights of CEMEX Southeast, LLC, while Ready Mix USA owns a 50.01%
interest, and we own a 49.99% interest, in the profits and losses and voting rights of Ready Mix USA LLC. CEMEX Southeast, LLC
is managed and fully consolidated by us, and Ready Mix USA LLC is managed by Ready Mix USA and is accounted for by us under
the equity method.
Under the Ready Mix USA LLC joint venture, we are required to contribute to the Ready Mix USA joint venture any ready-mix
concrete and concrete block assets we acquire inside the joint venture region, while any aggregates assets acquired inside the region
may be added to the Ready Mix USA joint venture at the option of the non-acquiring member. Building materials, pipe, transport and
storm water treatment assets are not subject to the contribution clause under the Ready Mix USA joint venture. The value of the
contributed assets is to be determined based on a formula by the Ready Mix USA joint venture.
On September 1, 2005, we had sold 27 ready-mix concrete plants and four concrete block facilities located in the Atlanta,
Georgia metropolitan area to Ready Mix USA LLC for approximately U.S.$125 million.
On January 11, 2008, in connection with the assets acquired from Rinker, and as part of our agreements with Ready Mix USA,
CEMEX contributed and sold to Ready Mix USA LLC, certain assets located in Georgia, Tennessee and Virginia, which had a fair
value of approximately U.S.$437 million. We received U.S.$120 million in cash for the assets sold to Ready Mix USA LLC and the
remaining assets were treated as a U.S.$260 million contribution by us to Ready Mix USA LLC. As part of the same transaction,
Ready Mix USA contributed U.S.$125 million in cash to Ready Mix USA LLC, which, in turn, received bank loans of U.S.$135
million. Ready Mix USA LLC made a special distribution in cash to us of U.S.$135 million. Ready Mix USA manages all the assets
acquired. Following this transaction, Ready Mix USA LLC continues to be owned 50.01% by Ready Mix USA and 49.99% by
CEMEX. The assets contributed and sold by CEMEX include: 11 concrete plants, 12 limestone quarries, four concrete maintenance
facilities, two aggregate distribution facilities and two administrative offices in Tennessee; three granite quarries and one aggregates
distribution facility in Georgia; and one limestone quarry and one concrete plant in Virginia. All these assets were acquired by us
through our acquisition of Rinker.
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