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CYDSA invested in salt and electricity projects

The Mexican company CYDSA made investments in fixed assets for 64 million dollars in 2020.

Of this amount, 21 million dollars were allocated to the Maintenance and Replacement segment, in order to ensure that the production processes operate under normal conditions.

The remaining 43 million dollars mainly include expenditures related to the Electricity and Steam Cogeneration Business Projects, aimed at ensuring the stability of the operation; and the Projects of the Business of Salt for Domestic Consumption and Industrial Applications focused on improving the logistics of commercialization, through the construction of a Warehouse for the Handling of Industrial Salt and a Distribution Center for Finished Product.

Also this amount of Investments in Assets for Competitiveness and Growth includes partial disbursements for projects that will be completed in the short term.

CYDSA

In 2020, the company‘s Investments for Competitiveness and Growth totaled $ 43 million.

Likewise, the implementation of Investment Projects to carry out the strategy aimed at increasing CYDSA’s competitiveness and growth capacity, required expenditures close to 800 million dollars during the last 10 years.

Until now, these initiatives have been carried out with the Group’s own resources, as well as through various financing obtained during the execution process, including loans to develop specific projects.

An essential element of this Competitiveness and Growth strategy is represented by the new plant to manufacture chlorine and caustic soda with the most advanced production processes in environmental and energy efficiency, whose construction is planned to be completed by the end of 2022 in Coatzacoalcos, Veracruz.

For this reason, in December 2019, CYDSA completed a new issuance of 120 million dollars in the international financial market, under the same terms and conditions as the “Senior Notes” issued in 2017.

With the resources of this additional issuance, the balance of the Notes in circulation increased from 330 million to a total of 450 million dollars, maturing in October 2027.

Financing

Thus, CYDSA’s financial structure at the end of 2019 included the necessary funds to support the relevant Investment Projects in the medium term.

However, in May 2020, in response to the extraordinary circumstances expected for the year, resources were received from a financing of 2.484 million pesos, equivalent to 100 million dollars on the date of the contract, through a loan revolving with a maturity of 3 years, in April 2023, agreed to be potentially renewed for two more years.

It was decided to keep this financing in liquid instruments, and thus have financial flexibility to solve any eventuality that might require access to short-term cash.

 

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