UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM20-F

(Mark One)

OR

For the fiscal year ended December 31, 20172019

OR

For the transition period fromto

OR

Date of event requiring this shell company report

For the transition period from                     to                     

Commission file number1-14946

CEMEX, S.A.B. de C.V.

(Exact name of Registrant as specified in its charter)

CEMEX PUBLICLY TRADED STOCK CORPORATION WITH VARIABLE CAPITAL

(Translation of Registrant’s name into English)

United Mexican States

(Jurisdiction of incorporation or organization)

Avenida Ricardo Margáin Zozaya #325, Colonia Valle del Campestre, San Pedro Garza García,

Nuevo León, 66265, México

(Address of principal executive offices)

Roger Saldaña Madero,

+52 81 8888-8888, +52 81 8888-4399,

Avenida Ricardo Margáin Zozaya #325, Colonia Valle del Campestre, San Pedro Garza García,

Nuevo León, 66265, México

(Name, Telephone,E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act.Act:

Securities registered or to be registered pursuant to Section 12(g) of the Act.Act:

None

(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.Act:

None

(Title of Class)

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.

15,085,567,39115,089,673,341 CPOs

30,214,469,91230,214,262,692 Series A shares (including Series A shares underlying CPOs)

15,107,234,95615,107,131,346 Series B shares (including Series B shares underlying CPOs)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ☒    No  ☐

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.    Yes  ☐    No  ☒

Note—Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of RegulationS-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, anon-accelerated filer, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule12b-2 of the Exchange Act (check one).Act.

Large accelerated filer  ☒                  Accelerated filer  ☐                Non-accelerated filer  ☐                Emerging growth company  ☐

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.    Item 17  ☐    Item 18  ☐

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule12b-2 of the Exchange Act).    Yes  ☐    No  ☒

TABLE OF CONTENTS

PART I

i

INTRODUCTION

CEMEX, S.A.B. de C.V. is incorporated as a publicly traded variable stock corporation with variable capital (sociedad anónima bursátil de capital variable) organized under the laws of the United Mexican States (“Mexico”). Except as the context otherwise may require, references in this annual report to “CEMEX,” “we,” “us” or “our” refer to CEMEX, S.A.B. de C.V. and its consolidated entities. See note 1 to our 20172019 audited consolidated financial statements included elsewhere in this annual report.

PRESENTATION OF FINANCIAL INFORMATION

Our consolidated financial statements included elsewhere in this annual report have been prepared in accordance with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board (“IASB”).

The regulations of the United States Securities and Exchange Commission (the “SEC”), do not require foreign private issuers that prepare their financial statements based on IFRS (as published by the IASB) to reconcile such financial statements to U.S.United States Generally Accepted Accounting Principles (“U.S. GAAP”).

References in this annual report to “U.S.$“$” and “Dollars” are to U.S.United States Dollars, references to “€” are to Euros, references to “£,” “Pounds Sterling” and “Pounds” are to British Pounds, and, unless otherwise indicated, references to “Ps,” “Mexican Pesos” and “Pesos” are to Mexican Pesos. References to “billion” mean one thousand million. References in this annual report to “CPOs” are to CEMEX, S.A.B. de C.V.’sCertificados de Participación Ordinarios. and each CPO represents two Series A shares and one Series B share of CEMEX, S.A.B. de C.V. References to “ADSs” are to American Depositary Shares of CEMEX, S.A.B. de C.V. and each ADS represents ten CPOs of CEMEX, S.A.B. de C.V.

Beginning with the three-months period ended March 31, 2019, and for all subsequent and comparative periods, as permitted under International Accounting Standard 21,The Effects of Changes in Foreign Exchange Rates (“IAS 21”) under IFRS, we changed our presentation currency from the Mexican Peso to the Dollar, which we consider preferable for the reasons set forth below:

Our audited consolidated financial statements, including comparative amounts provided below,and the accompanying notes to the audited consolidated financial statements, are presented as if the new presentation currency had always been our presentation currency. All currency translation adjustments have been set to zero as of January 1, 2010, which was the date of our transition to IFRS. Translation adjustments and cumulative translation adjustments recognized in other comprehensive income have been presented as if we had used Dollars as the presentation currency from that date. Comparative financial statements and their related notes were re-presented for the change in presentation currency by applying the methodology set out in IAS 21, using the closing exchange rates for the consolidated statements of financial position and the closing exchange rates of each month within the respective periods for consolidated income statements, consolidated statements of comprehensive income and consolidated statements of cash flows. Historic equity transactions were translated at the foreign exchange rate on the date of the transactions and were subsequently carried at historical value.

The financial statements of foreign subsidiaries, as determined using their respective functional currency, are translated to Dollars at the year-end closing exchange rate for statement of financial position accounts and at the closing exchange rates of each month within the period for income statement accounts. The corresponding translation effect is included within “Other equity reserves” and is presented in the consolidated statement of comprehensive income (loss) for the period as part of the currency translation results of foreign subsidiaries adjustment until the disposal of the net investment in the foreign subsidiary.

Beginning January 1, 2019, IFRS 16, Leases (“IFRS 16”), superseded all existing guidance related to lease accounting including IAS 17, Leases, and introduced a single lessee accounting model that requires a lessee to recognize, for all leases, allowing exemptions in the case of leases with a term of less than 12 months or when the underlying asset is of low value, assets for the right-of-use of the underlying asset against a corresponding financial liability, representing the net present value of estimated lease

payments under the contract. Under this model, the lessee recognizes in the income statement depreciation of the asset for the right-of-use and interest on the lease liability. After concluding the inventory and measurement of our leases, we adopted IFRS 16 using the full retrospective approach by means of which we determined an opening cumulative effect in our statement of financial position as of January 1, 2017, that is at the beginning of the oldest comparative period and re-presented previously reported financial statements of comparative periods. Therefore, unless otherwise indicated, all comparative amounts from our comparative financial statements as of December 31, 2018 and for the years ended December 31, 2017 and 2018 have been re-presented to include the effects of adoption of IFRS 16. See note 2.1 to our 2019 audited consolidated financial statements included elsewhere in this annual report are translationsfor a detailed description of Peso amounts at an exchange rateour adoption of Ps19.65 to U.S.$1.00, the CEMEX accounting rate (as defined herein) as of December 31, 2017. However, in the case of transactions conducted in Dollars, we have presented the U.S. Dollar amount of the transaction and in most cases, when such amounts are presented in our consolidated financial statements, the corresponding Peso amount is presented in our consolidated financial statements. These translations have been prepared solely for the convenience of the reader and should not be construed as representations that the Mexican Peso amounts actually represent those Dollar amounts or could be converted into Dollars at the rate indicated. Between January 1, 2018 and April 20, 2018, the Mexican Peso appreciated by approximately 6% against the U.S. Dollar, based on the noon buying rate for Pesos. See “Item 3—Key Information—Selected Consolidated Financial Information.”IFRS 16.

The noon buying rate for Mexican Pesos on December 31, 2017 was Ps19.64 to U.S.$1.00 and on April 20, 2018, was Ps18.61 to U.S.$1.00.

References in this annual report to total debt plus other financial obligations (which include debt under the facilities agreement, dated as of July 19, 2017, Credit Agreement (as defined herein)as amended and/or restated from time to time, including as amended on April 2, 2019 and November 4, 2019 (the “2017 Facilities Agreement”)) do not include debt and other financial obligations of ours held by us. See notes 2.6 and 16.2 to our 20172019 audited consolidated financial statements included elsewhere in this annual report for a detailed description of our other financial obligations. Total debt plus other financial obligations differs from the calculation of debt under the 2017 CreditFacilities Agreement.

We also refer in various places within this annual report

As a result of the April 2019 Facilities Agreement Amendments (as defined under “Item 5—Operating and Financial Review and Prospects—Liquidity and Capital Resources—Our Indebtedness”), among other things, we extended $1,062 million of maturities under the 2017 Facilities Agreement by three years and made certain adjustments tonon-IFRS measures, including “Operating EBITDA.” “Operating EBITDA” equals operating earnings before other expenses, net, plus amortization and depreciation expenses, as more fully explained in “Item 3—Key Information—Selected Consolidated Financial Information.” The presentation of thesenon-IFRS measures is not meant to be considered in isolation or as a substitute for our 2017 audited consolidated financial results prepared in accordance with IFRSleverage ratio, as issued by the IASB.

We have approximated certain numbersdescribed elsewhere in this annual report, in connection with the implementation of IFRS 16 and to their closest round numbers or a given number of decimal places. Due to rounding, figures shown as totals in tables may not be arithmetic aggregationscompensate for any potential effect from such adoption. In addition, we delayed the scheduled tightening of the figures preceding them.consolidated financial leverage ratio limit by one year. Moreover, as a result of the November 2019 Facilities Agreement Amendments (as defined under “Item 5—Operating and Financial Review and Prospects—Liquidity and Capital Resources—Our Indebtedness”), among other things, we negotiated: (a) an additional basket of up to $500 million that can only be used for buy-backs of shares or securities that represent shares of CEMEX, S.A.B. de C.V.; (b) a new allowance for disposals of non-controlling interests in subsidiaries that are not obligors (as defined in the 2017 Facilities Agreement) under the 2017 Facilities Agreement of up to $100 million per calendar year; (c) amendments relating to the implementation of our corporate reorganizations in Mexico, Europe and in the Trinidad Cement Group (as defined in the 2017 Facilities Agreement); and (d) modifications to the calculation and limits of the consolidated coverage ratio and the consolidated leverage ratio. See note 16.1 to our 2019 audited consolidated financial statements included elsewhere in this annual report for a detailed description of our financial covenants. See “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Proposed Amendments to the 2017 Facilities Agreement” for more information.

CERTAIN TECHNICAL TERMS

When used herein,in this annual report, the terms set forth below mean the following:

PART I

Item 1—Identity of Directors, Senior Management and Advisors

Not applicable.

Item 2—Offer Statistics and Expected Timetable

Not applicable.

Item 3—Key Information

SummaryCOVID-19 Outbreak

As of the date of this annual report, the effects of the novel strain of the coronavirus identified in China in late 2019 (“COVID-19”) on, among other things, supply chains, global trade, mobility of persons, business continuity, demand for goods and services and oil prices have grown throughout the world, including Mexico, the United States and in other countries in Asia, the Middle East, South and Central America, the Caribbean and Europe. Governmental authorities around the world have implemented numerous measures attempting to contain and mitigate the effects of the COVID-19 pandemic. The degree to which these measures, and COVID-19 generally, affect our results and operations will depend on future developments, which are highly uncertain and cannot be predicted, including, but not limited to, the duration and spread of the outbreak, its severity, the actions to contain the virus or treat its impact, and how quickly and to what extent normal economic and operating conditions can resume. See “—Risk Factors—Risks Relating to Our Business—The recent COVID-19 outbreak could materially adversely affect our financial condition and results of operations,” “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Effects of COVID-19 on Our Business and Operations” and “Recent Developments—Recent Developments Relating to Proposed Amendments to the 2017 Facilities Agreement.”

Financial Evolutionand Our “A Stronger CEMEX” Plan

As of December 31, 2008, we had $18,784 million of total debt, not including $3,020 million of Perpetual Debentures (as defined below). Most Important Transactions sinceof our outstanding debt as of December 31, 2008 had been incurred to finance our acquisitions, including the 2009 Refinancingacquisition of Rinker Group Limited (“Rinker”) in 2007, and our capital expenditure programs. The acquisition of Rinker substantially increased our exposure in the U.S., which experienced a sharp downturn in the housing and construction sectors caused by the 2007-2008 financial crisis. This downturn had adverse effects on our U.S. operations, making it more difficult for us to achieve our goal of decreasing our acquisition-related leverage and, given extremely tight credit markets during the height of the financial crisis, making it increasingly difficult for us to refinance our acquisition-related debt.

On August 14, 2009, CEMEX, S.A.B. de C.V. and certain of its subsidiaries entered intowe reached a comprehensive financing agreement (thewith our major creditors (as subsequently amended, the “2009 Financing Agreement”), which. The 2009 Financing Agreement extended the final maturities of U.S.$15approximately $15 billion in syndicated and bilateral loansbank facilities and private placement notes to February 14, 2014. On July 5, 2012, CEMEX, S.A.B. de C.V. and certainobligations. As part of its subsidiaries launched an exchange offer and consent request (the “2012 Exchange Offer and Consent Request”), to eligible creditors under the 2009 Financing Agreement, pursuant to which eligible creditors were requested to consent to certain amendments to the 2009 Financing Agreement (together, the “2012 Amendment Consents”). In addition, CEMEX, S.A.B. de C.V. and certain of its subsidiaries offered to exchange the indebtedness owed to such creditors under the 2009 Financing Agreement that were eligible to participate in the 2012 Exchange Offer and Consent Request (the “Participating Creditors”) for (i) new loans (or, in the case of the private placement notes, new private placement notes) or (ii) up to U.S.$500 million of CEMEX, S.A.B. de C.V.’s 9.50% Senior Secured Notes due 2018 issued on September 17, 2012 (the “June 2018 U.S. Dollar Notes”), in each case, in transactions exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”).

On September 17, 2012, CEMEX, S.A.B. de C.V. and certain of its subsidiaries successfully completed the refinancing transactions contemplated by the 2012 Exchange Offer and Consent Request (collectively, the “2012 Refinancing Transaction”), and CEMEX, S.A.B. de C.V. and certain of its subsidiaries entered into (a) an amendment and restatement agreement, dated September 17, 2012 (the “2012 Amendment and Restatement Agreement”), pursuant to which the 2012 Amendment Consents with respect to the 2009 Financing Agreement were given effect, and (b) a facilities agreement, dated September 17, 2012 (as amended from time to time, the “2012 Facilities Agreement”), pursuant to which CEMEX, S.A.B. de C.V. and certain of its subsidiaries were deemed to borrow loans from those Participating Creditors participating in the 2012 Exchange Offer and Consent Request in principal amounts equal to the principal amounts of indebtedness subject to the 2009 Financing Agreement that was extinguished by such Participating Creditors. As a result of the 2012 Refinancing Transaction, Participating Creditors received (i) U.S.$6,155 million in aggregate principal amount of new loans and new private placement notes and (ii) U.S.$500 million aggregate principal amount of the June 2018 U.S. Dollar Notes. In addition, U.S.$525 million aggregate principal amount of loans and private placement notes, which had remained outstanding under the 2009 Financing Agreement as of September 17, 2012, were subsequently repaid in full, as a result of prepayments made in accordance with the 2012 Facilities Agreement.

On September 29, 2014, CEMEX, S.A.B. de C.V. and certain of its subsidiaries entered into a facilities agreement, as amended and restated (the “2014 Credit Agreement”) for U.S.$1.35 billion with nine of the main lending banks from its 2012 Facilities Agreement. On November 3, 2014, five additional banks joined the 2014 Credit Agreement as lenders with aggregate commitments of U.S.$515 million, increasing the total amount of the 2014 Credit Agreement from U.S.$1.35 billion to U.S.$1.87 billion (increasing the revolving tranche of the 2014 Credit Agreement proportionally to U.S.$746 million).

On July 30, 2015, CEMEX, S.A.B. de C.V. repaid in full the total amount outstanding of U.S.$1.94 billion under the 2012 Facilities Agreement with new funds from 17 financial institutions, which joined new tranches under the 2014 Credit Agreement.

Many governments have already undertaken fiscal stimulus measures, enacting substantial amounts of funds in fiscal measures as well as massive monetary measures. The speed and strength of the recovery will depend on large, timely and targeted fiscal and financial measures such as wage subsidies, tax deferrals, cash transfers, extensions of unemployment insurance and social assistance, temporary adjustment of loans terms and credit guarantees, and to reduce stress to the financial system and avoid contagion. These measures seek to prevent liquidity pressures from turning into solvency problems. As measures to stabilize the economy take hold and business starts to normalize, policymakers will need to move swiftly to boost demand.

The pandemic has already turned global economic growth sharply negative in the past few months, though the magnitude of the drop is still uncertain. Most forecasts assume that the pandemic will fade in the second half of 2020, permitting a gradual lifting of containment measures and the reopening of the economy.The degree to which COVID-19 affects our results and operations will depend on future developments, which are highly uncertain and cannot be predicted, including, but not limited to, the duration and spread of the outbreak, its severity, the actions to contain the virus or treat its impact, and how quickly and to what extent normal economic and operating conditions can resume.

As of December 31, 2019, according to the International Monetary Fund (the “IMF”), global growth was projected to rise from an estimated 2.9% in 2019 to 3.3% in 2020 and to 3.4% for 2021. This projection had been slightly lower than the IMF’s projections a few months earlier due to the sudden downturns in economic activity in a few emerging market economies, notably India, which led to a reassessment of growth prospects over the next two years. In a few cases, this reassessment also reflected the impact of increased social unrest. We believe, as of the date of this annual report, that in addition to the global spread of COVID-19 discussed above, the other possible main downside concerns include: an escalation of trade tensions (given that prospects for trade and technology tensions between the U.S. and China to be fully resolved remain elusive, despite sporadic favorable news regarding ongoing negotiations and, moreover, escalation of U.S.-Europe trade frictions could undermine the nascent bottoming out of global manufacturing and trade); potential renewed weakness in manufacturing that could eventually spread to services and lead to a broader slowdown; a sharper than expected slowdown in China (due to authorities unable to “manage” a soft landing in the context of high debt, corporate bond defaults and distress of small banks); rapid shifts in financial sentiment, portfolio reallocations toward so called “safe” assets, sharp market corrections and central banks running out of alternatives to stimulate economic activity, as well as a sudden reassessment of the outlook for monetary policy. A widespread tightening in financial conditions would expose the financial vulnerabilities built up over years from low interest rates and further curtail spending on machinery, equipment and household durables; a rapid increase in risk aversion could reduce investors’ risk appetite with regard to emerging markets or lead to capital flows from emerging markets (higher interest rates, exchange rate depreciations and risk of sudden stops). Concerns regarding fiscal challenges for highly indebted countries may reappear; intensifying social unrest across many countries (reflecting, in some cases, the erosion of trust in established institutions and a lack of representation in governance structures) could dampen economic growth and investment climate, as well as complicate future reform efforts; the risk of renewed uncertainty around Brexit (as defined below) (for more details, see “–Political and social events and possible changes in governmental policies in some of the countries where we operate have had and may continue tocould have a material adverse effect on our business, financial condition, liquidity and results of operations throughout our operations worldwide.

While upside and downside risks to the short-term global economic growth outlook seem to be broadly balanced, we believe the scenario is not risk free. We believe that as of the date of this annual report, the possible main downside concerns include risks of a shift toward protectionist policies in a context of growing tradeoperations”); rising geopolitical tensions, amongparticularly between the U.S. and China;Iran, that could disrupt global oil supply, hurt sentiment, and weaken already tentative business investment; uncertainty from the upcoming U.S. presidential elections that could pose a possibly sharp tightening of financial conditionsrisk for both the U.S. and its impact on the global economy emerging markets, risk aversion, foreign exchange markets, volatility and financial markets; economic vulnerability of emerging market economies; elections in in some Latin American countries, in particular in Mexico; economic and political uncertainties in Europe; China´s economic performance;amidst trade and geopolitical risks intensions which are affecting foreign policy; and increased frequency and intensity of weather-related disasters as a result of climate change that endangers human health and the Middle East, and other regions experiencing political turmoil, includingglobal economy beyond the current situation in Syria.directly affected regions. The materialization of any of these concerns may have and may continue to have a material adverse effect on our business, financial condition, liquidity and results of operations. See “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Effects of COVID-19 on Our Business and Operations” for more information on the IMF’s revised economic global growth outlook and other important information.

A worsening of trade tensions and the imposition of broader barriers to cross-border trade could not only take a direct toll on economic activity but could also weaken confidence. The recent escalating cycle of trade restrictions and retaliation among the U.S. and China could have negative consequences to the global economy, including the countries in which we operate.

The equity market correctionU.S. was in March 2018 followingan extended expansion in its current business cycle. Even though the U.S. tariff announcement on steel and aluminum and a rangeprobability of Chinese products, as well asrecession in the announcement by China of retaliatory tariffs on imports from the U.S., are examples showing that asset prices can correct rapidly and trigger potentially disruptive portfolio adjustments. Financial conditions that existforecast horizon had diminished, it should not be fully dismissed, in particular in light of the dateCOVID-19 pandemic. Accordingly, the likelihood of this annual reportwhat could tighten sharply and expose vulnerabilities that have accumulated over the years, with potential adverse repercussions for economic growth. High asset valuations, both in emerging and advance economies, and very compressed term premiums raise the possibility ofbe viewed as a financial market correction, which could dampen growth and confidence.

The laws and regulations in Mexico to which we are subject, and interpretations thereof, may change, sometimes substantially, as a result of a variety of factors beyond our control, including political, economic, tailwindsregulatory or social events. As a result of amendments in May 2019 to the Mexican Federal Labor Law (Ley Federal del Trabajo) and monetary policy stimulusother related regulations, among other things, new labor authorities and courts were created, new bargaining procedures were implemented and provisions related to employees’ freedom of association and organization, collective bargaining agreements, and rules against labor discrimination were issued or amended. We cannot assure you that these changes will not adversely affect our business, financial condition, results of operations and prospects, in particular in Mexico. Additionally, in August 2019, the new Mexican Law for Europethe Termination of Ownership (Ley Nacional de Extinción de Dominio) was enacted. This new law grants the authority to the Mexican federal government to terminate the ownership of real estate property in Mexico if illicit activities are performed on such real estate properties. Therefore, if any illicit activities are performed on our real estate property (even without our knowledge or control), we could be deprived of our ownership rights and possibly worldwide.

Regarding our operations in Europe, the United Kingdom’s expected exit from the European Union is already affecting financial markets and increasing foreign exchange volatility. The United Kingdom’s exit from the European Union is having anwould not be compensated for such loss, which could have a material adverse impact on its economic activity. The substantial uncertainty about post-Brexit arrangements is weighing on investment and import cost. This situation could impact our business, andfinancial condition, results of operations and prospects, in particular in Mexico.

In Colombia, prior to the impact of COVID-19, economic activity had continued to grow, supported by robust growth in fixed investment due to lower corporate taxes and healthy private consumption supported by a solid financial system, growing remittances and higher demand from Venezuelan migrants. However, increasing unemployment and social unrest could weigh on consumer and investor confidence. Public investment is expected to remain subdued. The fiscal deficit is being reduced at a slow pace and a new tax reform should be required in two years to achieve the fiscal deficit target (negative impact on growth). Furthermore, Colombia is vulnerable to large capital outflows and the current account deficit increased to above 4.0% of GDP in 2019. If these risks continue, they could have a material adverse effect on our business, financial condition, results of operations and prospects in Colombia.

In Nicaragua, persistent uncertainty arising from the ongoing political crisis will continue to weigh on the economy. The main risks include (i) a further deterioration of the political and social landscape; (ii) an escalation of punitive measures and specific regulations by the U.S. government on foreign investment in Nicaragua’s businesses and other matters related to Nicaragua, such as the Nicaragua Human Rights and Anticorruption Act of 2018; and (iii) a further deterioration of fiscal and monetary imbalances which could result in a currency crisis. If these risks continue, they could have a material adverse effect on our business, financial condition, results of operations and prospects in Nicaragua.

The manufacturing recession and trade disputes have significantly affected the European economy, particularly the German economy, which is highly exposed to manufacturing activity and global trade. If trade tensions regain traction and/or the new carbon dioxide (“CO2”) related regulations further affect the car industry, it will be more difficult for the German economy to recover. With regard to the building industry, shortages (mostly in the United Kingdom.

labor market) continue to pose a risk for production, not only in Germany but also in other European countries such as Poland or the Czech Republic, as well as in developed countries such as the U.S. In Spain, the Catalan region conflict has resulted in social unrest,current government’s weakness is a source of concern. Regulatory and although it seems to have a transitory impacteconomic policy uncertainty remains high and is one of the main sources of instability, particularly in the local economy, an escalationautomotive and residential sectors, as well as other sectors most exposed to contracts linked to the minimum wage. In France, public investment was a main driver for growth in past quarters; however, our sector could suffer public investment disruptions in the aftermath of the conflictlocal elections in March 2020. In Poland, infrastructure outlays may not recover, weighing down on the industry throughout 2020 (cost increases have led companies to renegotiate government contracts leading to a sudden halt in infrastructure outlays in the third quarter of 2019); further, the housing market could affect tosuffer a sharp downward adjustment from the Spanish economy and to the construction sector performance. On the other hand, given that the Spanish national government seems to lack legislative support, early elections cannot be ruled out. These factors could adversely affect our operations and result of operations in Spain.high levels observed.

Significant trade links with western Europe render some of the eastern European countries susceptible to economic and political pressures from western Europe.

Additionally, centralCentral European countries might experience a reduction in the proceeds they receive from the European Union’s (the “EU”) structural funds over the coming years, which could hinder infrastructure investment in such countries and adversely affect our European operationsfinancial condition, business, liquidity and results of operations.operations, particularly with regard to our operations in Europe.

The Governing Council of the European Central Bank reduced the interest rate on its deposit facility by 10 basis points to -0.50% in September 2019 and, as of November 1, 2019, the Eurosystem restarted net purchases under its asset purchase program. The environment of negative deposit rates is distorting financial markets and creating uncertain consequences for the banking sector. There is a risk that negative rates may erode bank profitability and curb lending across Eurozone borders, creating other systemic risks to European economies.

All these factors, coupled with the impact of the COVID-19 pandemic, could impact market confidence and could limit the benefit of monetary policy stimulus for Europe and possibly worldwide, which in turn could adversely affect our results of operations, business, liquidity and financial position, particularly in Europe.

In Israel, the Middle East, political risk could moderate economic growth and adversely affect construction investments. The U.S.’ recognition of Jerusalem as Israel’s capital early this year has increased the tension amongcontributed to further tensions between Israelis and Palestinians. The conflict between Israel and Palestine continues to generate instability andAlso, the overall situation in Syria could worsen. Any escalation of these conflict or social unrestworsen, which would impact Israel, and the region in this region maygeneral. The political uncertainty arising from a third legislative election with no clear result in a year in March 2020 could affect our operations and it cannotsector, as many public construction projects could be ruled out.

In Egypt, we cannot be certain if the new government that was elected in 2018 willdelayed. The uncertainty around housing policy could also continue to successfully implementedweigh down the reforms needed to bring political and economic stability to the country. Any premature easing of monetary policy before inflation expectations are fully anchored,industry. The high public deficit will eventually require fiscal tightening measures. If these risks continue or opposition to reforms by vested interests,

Political and social events and possible changes in governmental policies in some of the countries where we operate could have a material adverse effect on our business, financial condition, liquidity and results of operations.

In recent years, some of the governments in the countries where we operate, such as in the United States,U.S. and Mexico, have implemented and may continue to implement significant changes in laws, public policy or regulations that could affect the political, economic and social conditions in the U.S. and Mexico, in the other countries where we operate, as well as in other countries. Any such changes may have a material adverse effect on our business, financial condition, liquidity and results of operations.

Furthermore, national

Further, presidential, and legislative, as well as state and local elections have taken place, or are scheduled to take place in 20182020 in several of the countries where we operate, including Mexico, Colombia, Brazil,Israel, the U.S., Poland, the Dominican Republic, Puerto Rico, Trinidad and certain countries in Europe, as well as mid-term elections in the United States. In Mexico, national presidentialTobago, Croatia and legislative elections are scheduled to take place in July 2018, with the elected presidential candidate assuming his duties in December 2018, and a presidential election will take place in Colombia in May 2018, with the elected candidate entering office in August 2018. For these countries, as is mostly the case when there is a change in governments, aEgypt. A change in federal government and the political party in control of the legislature in suchany of these countries could result in sharp changes to suchthe countries’ economic, political or social conditions, and in changes into laws, regulations and public policies, which may contribute to economic uncertainty in some of the countries in which we operate and could also materially impact our business, financial condition, liquidity and results of operations. Similarly, if no political party wins a clear majority in the legislative bodies of these countries, legislative gridlock and political and economic uncertainty may occur.result.

We cannot assure you that political or social developments in the countries where we operate or elsewhere, such as the election of new administrations, changes in laws, public policy or regulations, political

The 2017 CreditFacilities Agreement requires us to comply with several financial ratios and tests, including (i) a minimum consolidated coverage ratio of Operating EBITDA to interest expense (including interest accrued on Perpetual Debentures and cash payments on preferred stock)Debentures) and (ii) a maximum consolidated leverage ratio of totalnet debt (including Perpetual Debentures, guarantees and guarantees,capitalized leases under IFRS 16, excluding convertible/exchangeable obligations, the principal amount of subordinated optional convertible securities and finance leases and plus or minus the fair valuemark-to-market amount of derivative financial instruments, among other adjustments) to Operating EBITDA (in each case, as described in the 2017 CreditFacilities Agreement). The calculation and formulation of Operating EBITDA, interest expense, totalnet debt, the consolidated coverage ratio and the consolidated leverage ratio are set out in the 2017 CreditFacilities Agreement and may differ from the calculation and/or formulation of analogous terms in this annual report. Our ability to comply with these ratios may be affected by our results of operations, economic conditions and volatility in foreign exchange rates, by overall conditions in the financial and capital markets and the construction sector, and by any monetary penalties or fines we may have to pay as a result of any administrative or legal proceedings to which we may be exposed to. See “Item 4—Information on the Company—Regulatory Matters and Legal Proceedings,”Proceedings” for more information oninformation.

As a result of the April 2019 Facilities Agreement Amendments, among other things, we extended $1,062 million of maturities by three years and made certain adjustments to our regulatory mattersconsolidated financial leverage ratio, in connection with the implementation of IFRS 16 and legal proceedings. to compensate for any potential effect from such adoption. In addition, we delayed the scheduled tightening of the consolidated financial leverage ratio limit by one year. Moreover, as a result of the November 2019 Facilities Agreement Amendments, among other things, we negotiated: (a) an additional basket of up to $500 million that can only be used for buy-backs of shares or securities that represent shares of CEMEX, S.A.B. de C.V.; (b) a new allowance for disposals of non-controlling interests in subsidiaries that are not obligors (as defined in the 2017 Facilities Agreement) under the 2017 Facilities Agreement of up to $100 million per calendar year; (c) amendments relating to the implementation of corporate reorganizations in Mexico, Europe and in the Trinidad Cement Group (as defined in the 2017 Facilities Agreement); and (d) modifications to the calculation and limits of the consolidated coverage ratio and the consolidated leverage ratio. See note 16.1 to our 2019 audited consolidated financial statements included elsewhere in this annual report for a detailed description of our financial covenants. See “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Proposed Amendments to the 2017 Facilities Agreement” for more information.

The 2017 CreditFacilities Agreement requires us to comply with a minimum consolidated coverage ratio of Operating EBITDA to interest expense (including interest accrued on Perpetual Debentures and cash payments on preferred stock)Debentures), for the following periods, measured quarterly, of not less than (i) 2.50:1 for each12-month period ending on December 31, 2017, March 31, 2018, June 30, 2018,2019 through September 30, 2018, December 31, 2018, March 31, 2019, June 30, 2019, September 30, 2019, December 31, 2019 and March 31, 20202022 and (ii) 2.75:1 for the12-month period ending on June 30, 2020December 31, 2022 and on each subsequent quarterly date. In addition, the 2017 CreditFacilities Agreement requires us to comply with a maximum consolidated leverage ratio of totalnet debt (including Perpetual Debentures, guarantees and guarantees,capitalized leases under IFRS 16, excluding convertible / convertible/exchangeable obligations, the principal amount of subordinated optional convertible securities and finance leases and plus or minus the fair value of derivative financial instruments, among others) to Operating EBITDA, plus other adjustments) to EBITDAadjustments for the following periods, measured quarterly, not to exceed (i) 5.25:1 for theeach 12-month period ending December 31, 20172019 up to and including the12-month period ending on March 31, 2018, 2021;(ii) 5.00:1 for the12-month period periods ending June 30, 20182021 and the12-month period ending September 30, 2018,2021; (iii) 4.75:1 for the12-month period ending December 31, 20182021 up to and including the12-month period ending March 31, 2019,on September 30, 2022; (iv) 4.50:1 for eachthe 12-month period periods ending June 30, 2019, September 30, 2019, December 31, 20192022 and March 31, 20202023; and (v) 4.25:1 for the12-month period ending June 30, 20202023 and on each subsequent quarterly date.Reference Period (as defined in the 2017 Facilities Agreement). For the period ended December 31, 2017,2019, we reported to the lenders under the 2017 CreditFacilities Agreement a consolidated coverage ratio of 3.463.86 and a consolidated leverage ratio of 3.85,4.17, each as calculated pursuant to the 2017 CreditFacilities Agreement. See “Item 5—Operating and Financial Review and Prospects—Liquidity and Capital Resources—Our Indebtedness.”Indebtedness” and“Recent Developments—Recent Developments Relating to Proposed Amendments to the 2017 Facilities Agreement” for information regarding the proposed amendments to address any potential breach of the financial ratios in the 2017 Facilities Agreement.

Pursuant to the 2017 CreditFacilities Agreement, we are limited in relation torestricted from making aggregate annual capital expenditures in excess of U.S.$1$1.5 billion in any financial year (excluding certain capital expenditures, joint venture investments and acquisitions to be made by each ofCEMEX Latam Holdings, S.A. (“CLH”) and/or CHP CEMEX Holdings Philippines, Inc. (“CHP”)and their respective subsidiaries, and those funded by Relevant Proceeds (as defined in the 2017 CreditFacilities Agreement)), which capital expenditures, joint venture investments and acquisitions at any time then incurred are subject to a separate aggregate limit of (a) U.S.$500 million (or its equivalent) for each of CEMEX Latam and its subsidiaries and (b) U.S.(i) $500 million (or its equivalent) for each ofCLH and its subsidiaries and (ii) $500 million (or its equivalent) for CHP and its subsidiaries. In addition, in each case, the amounts of which we and our subsidiaries are allowed to incur for permitted acquisitions and investments in joint ventures cannot exceed certain thresholds as set out in the 2017 CreditFacilities Agreement. See “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Proposed Amendments to the 2017 Facilities Agreement” for more information on potential new restrictions to our capital expenditures.

We are also subject to a number of negative covenants under the 2017 CreditFacilities Agreement that, among other things, restrict or limit (subject to certain exceptions) our ability and the ability of each obligor (as defined in the

Agreement, taken as a whole),; (iv) enter into mergers,mergers; (v) enter into agreements that restrict our subsidiaries’ ability to pay dividends or repay intercompany debt,debt; (vi) acquire assets,certain assets; (vii) enter into or invest in joint venture agreements,agreements; (viii) dispose of certain assets,assets; (ix) grant additional guarantees or indemnities,indemnities; (x) declare or pay cash dividends or make share redemptions,redemptions; and (xi) enter into certain derivatives transactions. See “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Proposed Amendments to the 2017 Facilities Agreement” for more information on potential restrictions on dividend payments and share redemptions.

The 2017 CreditFacilities Agreement also contains a number of affirmative covenants that, among other things, require us to provide periodic financial information to our creditors. Pursuant to the 2017 CreditFacilities Agreement, a number of covenants and restrictions will, if CEMEX so elects, cease to apply (including the capital expenditure limitations mentioned above) or become less restrictive if (i) our consolidated leverage ratio for the two most recently completed quarterly testing periods is less than 3.75:1;1 or less; or, for the three most recently completed quarterly testing periods, our consolidated leverage ratio for the first and third of those quarterly testing periods is 3.75:1 or less and in the second quarterly testing period would have been 3.75:1 or less but for the proceeds of certain permitted financial indebtedness being included in the calculation of debtdebt; and (ii) no default under the 2017 CreditFacilities Agreement is continuing. At that point, the existing consolidated coverage ratio and consolidated leverage ratio tests will be replaced by a requirement that the consolidated leverage ratio must not exceed 4.25:1 and the consolidated coverage ratio must not be less than 2.75:1. However, we cannot assure you that we will be able to meet the conditions for these restrictions to cease to apply prior to the final maturity date under the 2017 CreditFacilities Agreement. See “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Proposed Amendments to the 2017 Facilities Agreement” for more information.

The 2017 CreditFacilities Agreement contains events of default, some of which may occur and are outside of our control. Such events of default include but are not limited to defaults (subject to certain exceptions) and grace periods, based on(i) non-payment,non-payment; (ii) material inaccuracy of representations and warranties,warranties; (iii) breach of covenants,covenants; (iv) bankruptcy (quiebra) or insolvency (concurso mercantil) of CEMEX, S.A.B. de C.V., any other obligor under the 2017 CreditFacilities Agreement or any other of our material subsidiaries (as defined in the 2017 CreditFacilities Agreement),; (v) inability to pay debts as they fall due or by reason of actual financial difficulties, suspension or threatened suspension of payments on debts exceeding U.S.$50$50 million or commencement of negotiations to reschedule debt exceeding U.S.$50 million,$50 million; (vi) a cross-default in relation to financial indebtedness in excess of U.S.$50 million,$50 million; (vii) certain changes to the ownership of any of the obligors under the 2017 Credit Agreement,Facilities Agreement; (viii) enforcement of any security against an obligor or material subsidiary,subsidiary; (ix) any attachment, distress or execution affects any asset of an obligor or material subsidiary which is reasonably likely to cause a material adverse effect; (x) expropriation and sequestration of assets of certain of our subsidiaries that cause a material adverse effect; (xi) the imposition of restrictions not in effect on July 19, 2017 are imposed that limit the ability of obligors to transfer foreign exchange for purposes of performing material obligations under the 2017 Credit Agreement, (xi)Facilities Agreement; (xii) any material adverse change arising in the financial condition of CEMEX, which creditors representing two thirds or more of the total commitments under the 2017 CreditFacilities Agreement determine would result in our failure, taken as a whole, to perform payment obligations under the 2017 Credit Agreement,Facilities Agreement; and (xii)(xiii) it becomes unlawful for us to comply with its laws or our obligations under the 2017 Credit Agreement.Facilities Agreement where non-performance is reasonably likely to cause a material adverse effect. If an event of default occurs and is continuing, upon the authorization of creditors representing two thirds or more of the total commitments under the 2017 CreditFacilities Agreement, the 2017 Facilities Agreement’s agent has the ability to accelerate all outstanding amounts due under the 2017 CreditFacilities Agreement. Acceleration is automatic in the case of insolvency.

We cannot assure you that in the future we will be able to comply with the restrictive covenants and limitations contained in the 2017 Credit Agreement.Facilities Agreement or that we will be in compliance with other agreements which constitute financial indebtedness in excess of $50 million in which any non-compliance would trigger a cross-default, such as, for example, the senior unsecured Philippine Peso term loan facility entered into by CHP with BDO Unibank, Inc. on February 1, 2017 for a loan of up to the Philippine Peso equivalent of, as of December 31, 2019, $224 million, as amended or supplemented from time to time. Our failure to comply with such covenants and limitations could result in an event of default, which could materially and adversely affect our business, financial condition, liquidity and results of operation.operations. See “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Proposed Amendments to the 2017 Facilities Agreement” for more information.

Changes to, or replacement of, the LIBOR Benchmark Interest Rate, could adversely affect our business, financial condition, liquidity and results of operations.

In July 2017, the United Kingdom’s Financial Conduct Authority (“FCA”), a regulator of financial services firms and financial markets in the United Kingdom, stated that they will plan for a phase out of regulatory oversight of the London InterBank Offered Rate (“LIBOR”) interest rate indices. The FCA has indicated they will support the LIBOR indices through 2021 to allow for an orderly transition to an alternative reference rate. LIBOR indices, in particular the Dollar LIBOR, are commonly used as a benchmark for our financing agreements, financial obligations and derivatives, including our 2017 Facilities Agreement, which systematically catalogue relevant LIBOR provisions, including uniform trigger provisions intended to identify a test for when LIBOR no longer governs the agreement and/or uniform fallback provisions intended to identify an alternative reference rate, or there may be vast, or slight, differences in those provisions. It is uncertain at this time whether LIBOR will change or cease to exist or the extent to which those entering into financial agreements will transition to any other particular benchmark. Other benchmarks may perform differently than LIBOR or have other consequences that cannot currently be anticipated. As of December 31, 2019, 22% of our foreign currency-denominated long-term debt bears floating rates at a weighted average interest rate of LIBOR plus 285 basis points. A transition away from and/or changes to the LIBOR benchmark interest rate could adversely affect our business, financial condition, liquidity and results of operations.

We pledged the capital stock of some of our subsidiaries that represent substantially all of our business as collateral to secure our payment obligations under the 2017 CreditFacilities Agreement, the indentures governing our outstanding Senior Secured Notes and other financing arrangements.

In connection with the 2017 CreditFacilities Agreement, we pledged under pledge agreements or transferred to trustees under acertain security trust,trusts the Collateral and all proceeds of the Collateral, to secure our obligations under the

In addition, our levels of debt, contractual restrictions and our need to deleverage may limit our planning flexibility and our ability to react to changes in our business and the industry and may place us at a competitive disadvantage compared to competitors who may have no need to deleverage or who may have lower leverage ratios and fewer contractual restrictions.restrictions, or that have no restrictions at all. There can also be no assurance that, because of our leverage ratio and contractual restrictions, we will be able to improve or maintain our operating margins and deliver financial results comparable to the results obtained in the past under similar economic conditions.conditions, or that we will be able to execute the capital expenditures that are disclosed in this annual report. Also, there can be no assurance that we will be able to implement our business strategy and initiatives, and improve our results and sales,revenues, which could affect our ability to comply with our payment obligations under our debt agreements and instruments.

guarantee indebtedness; (vii) enter into agreements that restrict dividends or other distributions from restricted subsidiaries; (viii) enter into transactions with affiliates; (ix) create or assume liens; (x) engage in mergers or consolidations; and (xi) enter into a sale of all or substantially all of our assets.

These restrictions could limit our ability to seize attractive growth opportunities for our businesses that are currently unforeseeable, particularly if we are unable to incur financing or make investments to take advantage of these opportunities.

As of the date of this annual report, CEMEX, S.A.B. de C.V. currently does not expect that existing regulatory, legal and economic restrictions on its currentexisting direct and indirect subsidiaries’ ability to pay dividends and make loans and other transfers to it will negatively affect its ability to meet its cash obligations. However, the jurisdictions of organization of CEMEX, S.A.B. de C.V.’s current direct or indirect subsidiaries, or of any future subsidiary, may impose additional and more restrictive regulatory, legal and/or economic limitations. In addition, CEMEX, S.A.B. de C.V.’s subsidiaries may not be able to generate sufficient income to pay dividends or make loans or other transfers to it in the future, or may not have access to Dollars in their respective countries, which, as of the date of this annual report, would be the preferred currency to be received by CEMEX, S.A.B. de C.V. to service the majority of its debt payments. Also, because not all of CEMEX, S.A.B. de C.V.’s subsidiaries are wholly-owned, any decision to have any of CEMEX, S.A.B. de C.V.’s subsidiaries declare and pay dividends or make loans or other transfers to us is subject to any minority rights that non-controlling shareholders may have in the CEMEX, S.A.B. de C.V. subsidiary that is not wholly-owned. Any material additional future limitations on our subsidiaries could adversely affect CEMEX, S.A.B. de C.V.’s ability to service our debt and meet its other cash obligations. See “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Effects of COVID-19 on Our Business and Operations” for more information on the impact of COVID-19 on our operating subsidiaries and the possibility of less income being generated by our operating subsidiaries.

We are subject to restrictions due toand reputational risks resulting from non-controlling interests held by third parties in our consolidated subsidiaries.

We conduct our business through subsidiaries. In some cases, third-party shareholders holdnon-controlling interests in these subsidiaries, such as in the case of CEMEX Latam,including CLH, CHP, TCLTrinidad Cement Limited (“TCL”) and CCCL.Caribbean Cement Company Limited (“CCCL”), among others. Various disadvantages may result from the participation ofnon-controlling shareholders whose interests may not always be aligned with ours. Some of these disadvantages may, among other things, result in our inability to implement organizational efficiencies, divest or acquire assets and transfer cash and assets from one subsidiary to another in order to allocate assets most effectively. In addition, we are also exposed to third-party shareholders initiating different actions or proceedings against us as controlling shareholders on corporate and corporate governance related matters, which could also harm our reputation and have an adverse effect on our business, liquidity, financial condition and results of operations.

We have to service our debt and other financial obligations denominated in Dollars with revenues generated in Mexican Pesos or other currencies, as we do not generate sufficient revenue in Dollars from our operations to service all our debt and other financial obligations denominated in Dollars. This could adversely affect our ability to service our obligations in the event of a devaluation or depreciation in the value of the Mexican Peso, or any of the other currencies of the countries in which we operate, compared to the U.S. Dollar. In addition, our consolidated reported results and outstanding indebtedness are significantly affected by fluctuations in exchange rates between the Dollar (our reporting currency, vis-à-vis the Mexican Peso and significant other currencies.currencies within our operations).

A substantial portion of our total debt plus other financial obligations is denominated in Dollars. As of MarchDecember 31, 2018,2019, our debt plus other financial obligations denominated in Dollars represented 65%67% of our total debt plus other financial obligations, which does not include U.S.$371$371 million of Dollar-denominated Perpetual Debentures. Our Dollar-denominated debt must be serviced with funds generated mostly by CEMEX, S.A.B. de C.V.’s as well as its direct and indirect subsidiaries.subsidiaries’ operations in Mexico. Although we have substantial operations in the U.S., we continue to strongly rely on ournon-U.S. assets to generate revenues to service our Dollar-denominated debt. Consequently, we have to use revenues generated in Mexican Pesos, Euros or other currencies to service our Dollar-denominated obligations. See “Item 5—Operating and Financial Review and Prospects—Quantitative and Qualitative Market Disclosure—Interest Rate Risk, Foreign Currency Risk and Equity Risk—Foreign Currency Risk.” A devaluation or depreciation in the value of the Mexican Peso, Euro, British Pound Sterling, Colombian Peso, Philippine Peso or any of the other currencies of the countries in which we operate, compared to the U.S. Dollar, could adversely affect our ability to service our Dollar-denominated debt. In 2017,2019, our operations in Mexico, the United Kingdom, France, Germany, Spain, Poland, the Rest of Europe, (as described in “Item 4—Information onColombia, Panama, the Company—Business Overview”), Colombia, Costa Rica,Dominican Republic, Caribbean TCL (as defined below), Rest of South, Central America and the Caribbean, the Philippines, Egypt,Israel and the Rest of Asia, Middle East and Africa, (as described in “Item 4—Information on the Company—Business Overview”), which are our mainnon-Dollar-denominated non-Dollar denominated operations, together generated 61%65% of our total net salesrevenues in Mexican PesoDollar terms (21%, 7%5%, 6%, 4%3%, 2%, 2%, 3%5%, 4%, 1%, 2%, 2%, 4%, 3%, 1%5% and 5%2%, respectively) before eliminations resulting from consolidation. In 2017, 24%2019, 27% of our net salesrevenues in Mexican PesoDollar terms were generated from our operations in the United States. U.S. before eliminations resulting from consolidation.

During 2017,2019, the Mexican Peso appreciated 5%3.7% against the U.S. Dollar, the Euro appreciated 12%depreciated 2.1% against the U.S. Dollar and the British Pound Sterling appreciated 9%3.9% against the U.S. Dollar. Currency hedges that we may be a party to or may enter in the future may not be effective in covering all our currency-related risks. Our

instruments could negatively affect, our operations, especially in volatile and uncertain markets.” See “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Effects of COVID-19 on Our Business and Operations” for more information on the impact of COVID-19 on the Mexican Peso value against the Dollar.

In addition, as of MarchDecember 31, 2018,2019, our Euro-denominated total debt plus other financial obligations represented 25%23% of our total debt plus other financial obligations, which does not include the €64 million aggregate principal amount of our Euro-denominated Perpetual Debentures.

Our use of derivative financial instruments has negatively affected, and any new derivative financial instruments could negatively affect, our operations, especially in volatile and uncertain markets.

We have used, and may continue to use, derivative financial instruments to manage the risk profile associated with interest rates and currency exposure of our debt, to reduce our financing costs, to access alternative sources of financing and to hedge our net assets in certain currency, as well as some of our financial and operating risks. However, we cannot assure you that our use of such instruments will allow us to achieve these objectives due to the inherent risks in any derivatives transaction.transaction or the risk that we will not continue to have access to such instruments at reasonable costs, or at all.

As of December 31, 2017,2019, our derivative financial instruments consisted of equity forwards on third party shares, foreign exchange forward contracts under a net investment hedge program, interest rate derivativesswap instruments related to energy projects andbank loans, equity forwards on third-party shares, as well as fuel price hedging derivatives, which had an impact on our financial position. The fair value changes of our derivative financial instruments are reflected in our income statement, which could introduce volatility in our controlling interest net income and our related ratios. For the years endedAs of December 31, 20162018 and 2017,2019, the recognition of changes in the fair value ofaggregate notional amount under our outstanding derivative financial instruments during the applicable period representedwas $2,608 million ($1,249 million of net gainsinvestment hedge, $1,126 million of Ps317interest rate swaps, $111 million (U.S.$17 million)of forwards on third-party shares and $122 million of fuel price hedging) and $2,324 million ($1,154 million of net gainsinvestment hedge, $1,000 million of Ps161interest rate swaps, $74 million (U.S.$9 million)of forwards on third-party shares and $96 million of fuel price hedging), respectively.

respectively, with a mark-to-market valuation representing a net liability of $18 million as of December 31, 2018 and a net liability of $100 million as of December 31, 2019. See note 16.4 to our 2019 audited consolidated financial statements included elsewhere in this annual report for a detailed description of our derivative financial instruments. For the majority of the last teneleven years, CEMEX has significantly decreased its use of derivatives instruments related to debt, both currency and interest rate derivatives related to debt, thereby reducing the risk of cash margin calls. However, with respect to our existing financial derivatives, we may incur net losses and be subject to margin calls that do not require a substantial amount of cash to cover such margin calls. If we enter into new derivative financial instruments, we may incur net losses and be subject to margin calls in which the cash required to cover margin calls may be substantial and may reduce the funds available to us for our operations or other capital needs. In addition, as with any derivative position, CEMEX assumes the creditworthiness risk of the counterparty, including the risk that the counterparty may not honor its obligations to us. In addition, entering into new derivative financial instruments incurs costs, and we cannot assure you that any new derivative financial instrument that we enter into will be done so at reasonable costs, or, if our credit risk worsens, will be available to us at all.

We are subject to the laws and regulations of the countries where we operate and do business and any material changes in such laws and regulations and/or any significant delays in our assessing the impact and/or adapting to such changes may have an adverse effect on our business, financial condition, liquidity and results of operations.

Our operations are subject to the laws and regulations of the countries where we operate and do business, and such laws and regulations, and/or governmental interpretations of such laws and regulations, may change. Because CEMEX, S.A.B. de C.V. is organized under Mexican laws, and because of the considerable size of CEMEX, S.A.B. de C.V.’s operations in the U.S. and the fact that CEMEX, S.A.B. de C.V.’s ADSs trade on the New York Stock Exchange (the “NYSE”), we have to comply with the laws and regulations, and/or governmental interpretations of such laws and regulations, of Mexico and the U.S., whether or not we operate and do business through a subsidiary located in Mexico or the U.S.

Any change in such changelaws and regulations, and/or governmental interpretations of such laws and regulations, may have a material adverse effect on our business, financial condition, liquidity and results of operations. Furthermore, changes in laws and regulations, and/or governmental interpretations of such laws and regulations, in the countries where we operate may require us to devote a significant amount of time and resources to assess and, if required, to adjust our operations to any such changes, which could have a material adverse effect on our business, financial condition, liquidity and results of operations. In addition, any significant delays in assessing the impact and/or, if required, in adapting to changes in laws and regulations and/or governmental interpretations of such laws and regulations may also have a material adverse effect on our business, financial condition, liquidity, results of operations and prospects. For more information, see “—Economic conditions in some of the countries where we operate and in other regions or countries may adversely affect our business, financial condition, liquidity and results of operations.operations,” “—Political and social events and possible changes in governmental policies in some of the countries where we operate could have a material adverse effect on our business, financial condition, liquidity and results of operations “and “—Our operations are subject to environmental laws and regulations.”

We or our third-party providers may fail to maintain, obtain or renew or may experience material delays in obtaining requisite governmental or other approvals, licenses and permits for the conduct of our business.

We and our third-party providers of goods and services, as applicable, require various approvals, licenses, permits, concessions and certificates in the conduct of our business. We cannot assure you that we, or our third- party providers of goods and services, will not encounter significant problems in obtaining new or renewing existing approvals, licenses, permits, concessions and certificates required in the conduct of our business, or that we, or our third-party providers of good and services, will continue to satisfy the conditions to which such approvals, licenses, permits, concessions and certificates that we currently have or may be granted in the future. There may also be delays on the part of regulatory and administrative bodies in reviewing our applications and granting approvals. The implementation of new laws and regulations on environmental-related matters in the countries in which we operate or in the countries from which our third-party providers of goods and services source their deliverables to us, may create stricter requirements to comply with. This could delay our ability to obtain the related approvals, licenses, permits, concessions and certificates, or could result in us not being able to obtain them at all. If previously obtained approvals, licenses, permits and certificates are revoked and/or if we, or our third-party providers of goods and services, fail to obtain and/or maintain the necessary approvals, licenses, permits, concessions and certificates required for the conduct of our business, we may be required to incur substantial costs or temporarily suspend or alter the operation of one or more of our operating units, production facilities, mineral extraction locations or of any relevant component of them, which could affect the general production of these units, facilities or locations, which in turn could have a material adverse effect on our business, financial condition, liquidity, results of operations and prospects. See “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Effects of COVID-19 on Our Business and Operations” for more information on the impact of certain measures being taken by the governments of the countries in which we operate regarding temporary closures of our operating facilities to stop the spread of COVID-19.

We may fail to secure certain materials required to run our business.

We increasingly use in most of our business certainby-products of industrial processes produced by third parties, such as pet coke,fly-ash, fly ash, slag and synthetic gypsum.gypsum, among others, as well as natural resources such as water. While we are not dependent on our suppliers and while we try to secure the supply of the required materials, products or resources through long-term renewable contracts and framework agreements, which ensureallow us to better management ofmanage supplies, short-term contracts are however entered into in certain countries where we operate. Should existing suppliers cease operations or reduce or eliminate production of theseby-products, or should for any reason any suppliers not be able to deliver to us the contractual quantities, or should laws and/or regulations in any region or country limit the access to these materials, products or resources, sourcing costs for these materials could increase significantly or require us to find alternative sources for these materials, which could have a material adverse effect on our business, financial condition, liquidity, results of operations and prospects. Additionally,In particular, scarcity and quality of natural resources (such as water and aggregates reserves) in some of the countries where we operate could have a material adverse effect on our operations, costs and results of operations. See “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Effects of COVID-19 on Our Business and Operations” for more information on the impact of COVID-19 on supply chains.

We may not be able to realize the expected benefits from any acquisitions or joint ventures, some of which may have a material impact on our business, financial condition, liquidity and results of operations.

Even though

Although we have not made any major acquisitions in recent years or entered into significant joint ventures in recent years, our ability to realize the expected benefits from any acquisitions or joint ventures depends, in large part, on our ability to integrate acquired operations with our existing operations in a timely and effective manner.manner or on our ability to properly manage, together with any joint venture partner, any joint venture business. These efforts may not be successful. Although we have had disposed of assets in the past through our recently concluded divestment programand may continue to do so to reduce our overall leverage and rebalance our portfolio, the 2017 CreditFacilities Agreement and other debt instruments restrict our ability to acquire assets and weenter into joint ventures. We may in the future acquire new operations or enter into joint ventures and integrate such operations into our existing operations, and some of such acquisitions or joint ventures may have a material impact on our business, financial condition, liquidity and results of operations. We cannot assure you that we will be successful in identifying or acquiring suitable assets in the future, or that the terms under which we may acquire any assets or enter into joint ventures in the future would be favorable to us.us or that we will be able to find suitable partners for our joint ventures at all. If we fail to achieve theany anticipated cost savings from any acquisitions or joint ventures, our business, financial condition, liquidity and results of operations could be materially and adversely affected.

High energy and fuel costs may have a material adverse effect on our operating results.

Electric energy and fuel costs represent an important part of our overall cost structure. The price and availability of electric energy and fuel are generally subject to market volatility and, therefore, may have an adverse impact on our costs and operating results. Furthermore, if third partythird-party suppliers fail to provide to us the required amounts of energy or fuel under existing agreements, we may need to acquire energy or fuel at an increased cost from other suppliers, without being reimbursed for the increased costs by the

committed supplier, to fulfill certain contractual commitments.commitments with third parties or for use in our operations. In addition, governments in

and most external economic variables provide us with confidence that a reasonably determinable improvement in themid-term is expected in their operating results, management uses cash flow projections over a period of up to ten years, to the point inat which future expected average performance resembles the historical average performance and to the extent we have detailed, explicit and reliable financial forecasts and is confident and can demonstrate its ability, based on past experience, to forecast cash flows accurately over that longer period.forecasts. If the value in use of a group of cash-generating unitsCGUs to which goodwill has been allocated is lower than its corresponding carrying amount, we determine its corresponding fair value using methodologies generally accepted in the markets to determine the value of entities, such as multiples of Operating EBITDA and/or by reference to other market transactions, among others. transactions.

Impairment tests are significantly sensitive to, among other factors, the estimation of future prices of our products, trends in the development of operating expenses, local and international economic trends in the construction industry, the long-term growth expectations in the different markets, as well as the discount rates and the growth rates in perpetuity applied, among others.applied. For purposes of estimating future prices, we use, to the extent available, historical data plus the expected increase or decrease according to information issued by trusted external sources, such as national construction or cement producer chambers and/or in governmental economic expectations. Operating expenses are normally measured as a constant proportion of revenues, following experience. However, such operating expenses are also reviewed considering external information sources in respect of inputs that behave according to international prices, such as oil and gas. We use specificpre-tax discount rates for each group of cash-generating unitsCGUs to which goodwill is allocated, which are applied topre-tax cash flows. The amounts of estimated undiscounted cash flows are significantly sensitive to the growth rates in perpetuity applied. Likewise, the amounts of discounted future cash flows are significantly sensitive to the weight average cost of capital (discount rate) applied. The higher the growth rate in perpetuity applied, the higher the amount of undiscounted future cash flows by group of cash-generating unitsCGUs obtained. Conversely,Moreover, the amounts of discounted future cash flows are significantly sensitive to the weighted average cost of capital (discount rate) applied. The higher the discount rate applied, the lower the amount of discounted estimated future cash flows by group of cash-generating unitsCGUs obtained.

During the last quarters of each of 2015, 20162017, 2018 and 2017,2019, we performed our annual goodwill impairment test. For the years ended as of December 31, 20152018 and 2016,December 31, 2019, we did not determine any goodwill impairments. During 2017, in connection with our operating segment in Spain and considering the uncertainty over the improvement of indicators affecting the country’sSpain’s construction industry (and consequently the expected consumption of cement,ready-mix concrete and aggregates), partially a result ofdue to the country’s then complex prevailing political environment, which resultsresulted in limited expenditure in infrastructure projects, as well as the uncertainty in the expected price recovery and the effects of increased competition and imports,imports. As a result, our management considered a future reduction of the related cash flows projections from 10 to five years and determined that the net book value of our operating segment in Spain exceeded the amount of the net presentits value of projected cash flowsin use by Ps1,920 million (U.S.$98 million).$98 million. As a result, we recognized a goodwill impairment during 2017 in the aforementioned amount as part of “Other expenses, net” in the income statement against the related goodwill balance. See note 15.2 to our 20172019 audited consolidated financial statements included elsewhere in this annual report.

Considering the important role that economic factors play in testing goodwill for impairment, we cannot assure that an eventualany downturn in the economies where we operate will not necessitate further impairment tests and a possible downward readjustment of our goodwill for impairment under IFRS. Such an impairment test could result in impairment charges which could be material to our financial statements, which could have a material adverse effect on our financial condition.

We are subject to litigation proceedings, including a federal securities class action, government investigations relating to corruption related matters and antitrust proceedings, that could harm our business if an unfavorable ruling were to occur.and our reputation.

From time to time, we are and may become involved in litigation, investigations and other legal or administrative proceedings relating to claims arising from our operations, either in the normal course of business or not.not, or arising from violations or alleged violations of laws, regulations or acts. As described in, but not limited to, “Item 4—Information on the Company—Regulatory Matters and Legal Proceedings,” as of December 31, 2019, we are currentlywere subject to a number of significant legal proceedings, including, but not limited to,

We havecannot assure you that our internal control over financial reporting will be effective in the future or that a material weakness will not be discovered with respect to a prior period for which we had previously believed that our internal control over financial reporting was effective. Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Internal control over financial reporting refers to a process designed by, or under the supervision of, the Chief Executive Officer (the “CEO”) and Executive Vice President of Finance and Administration/Chief Financial Officer (the “CFO”) and effected by CEMEX, S.A.B. de C.V.’s board of directors and our management to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. As an example, in 2016 and 2017, our management concluded that our internal control over financial reporting was not effective as of December 31, 2017, and our remediation efforts are ongoing. As a result, our ability to report our results of operations accurately, including our ability to make required filings with government authorities, may be adversely affected if our remediation efforts are not adequate. In addition, the trading price of our securities may be adversely affected by a related negative market reaction.

We have identified a material weakness in our internal control over financial reporting. Our management, including CEMEX, S.A.B. de C.V.’s Chief Executive Officer and Executive Vice President of Finance and Chief Financial Officer, has concluded that our disclosure controls and procedures were not effective as of December 31, 2017 to achieve their intended objectives. We have identified the following material weakness in our internal control over financial reporting: our risk assessment process did not operate effectively to implement controls that would prevent, or detect and correct, misstatements resulting from apparent collusion or management override of controls in relation to significant unusual transactions. In addition, we did not design and operate effective monitoring controls to detectnon-compliance with our policies related to the financial reporting of significant unusual transactions. This material weakness relates, in part, to the previously disclosed irregular payments to anon-governmental individual made in connection with the construction by CEMEX Colombia of a new integrated cement plant in the Antioquia department near the municipality of Maceo, Colombia (the “Maceo Project”).operating effectively. As of December 31, 2017,2018 and December 31, 2019, respectively, our management and our independent registered public accounting firm concluded that our internal controls over financial reporting were operating effectively. However, we cannot assure you that additional material weaknesses will not be identified in the implementation offuture, which could result in material misstatements in our remediation planfinancial statements or a failure to address this material weakness was not far enough advanced to provide a sufficient level of assurance that such circumvention or override of controls and misuse of funds by management would be prevented. For more information, see “Item 15—Controls and Procedures.” As of the date of this annual report, the process of designing, implementing and validating remedial measures related to the material weakness is ongoing. Ifmeet our efforts to remediate this material weakness are not successful, we may be unable to report our results of operations accurately and make our required filings with government authorities, including the SEC. Furthermore,reporting obligations. This, in turn, could negatively impact our business and operating results, andaccess to capital markets, the market price of our securities may be adversely affected by related negative market reactions. We cannot be certain that inshares and our ability to remain listed on the future additional material weaknesses will not exist or otherwise be discovered.NYSE.

Our operations are subject to environmental laws and regulations.

Our operations are subject to a broad range of environmental laws and regulations in each of the jurisdictions in which we operate. These laws and regulations impose stringent environmental protection standards regarding, among other things, air emissions, wastewater discharges, the use and handling of hazardous waste or materials, waste disposal practices and the remediation of environmental damage or contamination. These laws and regulations expose us to the risk of substantial environmental costs and liabilities, including fines and other sanctions, the payment of compensation to third parties, remediation costs and damage to reputation. Moreover, the enactment of stricter laws and regulations, stricter interpretation of existing laws or regulations or new enforcement initiatives, may impose new risks or costs on us or result in the need for additional investments in pollution control equipment, which could result in a material decline in our profitability.

requirements that are not applicable to operating facilities. While compliance with these laws and regulations has not materially adversely affected our operations in the past, we cannot assure you that these requirements will not change, and that compliance will not adversely affect our operations in the future. Furthermore, we cannot assure you that existing or future circumstances or developments with respect to contamination will not require us to make significant remediation or restoration expenditures, which could have a material adverse effect on our business, financial condition, liquidity and results of operations.

The cement manufacturing process requires the combustion of large amounts of fuel and creates carbon dioxide (“CO₂”)CO2 as aby-product of the calcination process. Therefore, efforts to address climate change through federal, state, regional, EU and international laws and regulations requiring reductions in emissions of greenhouse gases (“GHGs”) can create economic risks and uncertainties for our business. Such risks could include the cost of purchasing allowances or credits to meet GHG emission caps, the cost of installing equipment to reduce emissions to comply with GHG limits or required technological standards, decreased profits or losses arising from decreased demand for our goods and higher production costs resulting directly or indirectly from the imposition of legislative or regulatory controls. To the extent that financial markets view climate change and GHG emissions as a financial risk, this could have a material adverse effect on our cost of and access to capital. Given the uncertain nature of the actual or potential statutory and regulatory requirements for GHG emissions at the federal, state, regional, EU and international levels, we cannot predict the impact on our operations or

As of the date of this annual report, 2020, the wide spread of COVID-19 has impacted and may continue to impact our company’s business in some of the markets where we operate. Many of our operations have been and may continue to be impacted by governments’ decisions to suspend non-essential activities or lower production to comply with social distancing protocols, as well as by lower demand for our products. In Mexico, we are operating in accordance to technical guidelines defined by the Mexican government. In the South and Central America and the Caribbean region, with the exception of Costa Rica, Nicaragua and Haiti, our operations have been temporarily affected. In Europe, Middle East, Africa and Asia, the main impacts have been felt in Spain and the Philippines, where our operations are running on a limited basis. Other countries have taken a toll on the market side, with drops in demand which has ended up in some temporary site closures. In the U.S., while all of our sites remain operational, the main impact has been a slowdown in demand particularly in California and the mid-south region. The fact that many states continue to put in place shelter in place orders will probably add complexity in terms of logistics and cause some additional delays in orders and site construction projects.

While the impact and duration of COVID-19 are highly uncertain and remain unclear, we have undertaken several measures to maximize the protection and health of our employees, communities, third parties and other stakeholders while reinforcing our business strength and financial resilience across our markets. However, if the COVID-19 pandemic continues to escalate, it could potentially have a material adverse effect on our business, financial condition, liquidity and results of operations.

Our operations in Egypt, the United Arab Emirates (“UAE”) and Israel have experienced instability as a result of, among other things, civil unrest, terrorism, extremism, deterioration of general diplomatic relations and changes in the geopolitical dynamics in the region. There can be no assurances that political turbulence in Egypt, Iran, Iraq, Syria, Libya, Yemen and other countries in Africa, the Middle East and Asia will abate in the near future or that neighboring countries will not be drawn into conflict or experience instability. In addition, some of our operations are or may be subject to political risks, such as confiscation, expropriation and/or nationalization, as for example was the case of our past operations in Venezuela and is currently the case in Egypt. See “Item 4—Information on the Company—Regulatory Matters and Legal Proceedings—Other Legal Proceedings—Egypt Share Purchase Agreement.”

Our

Since 2011, our operations in Egypt have since 2011 been exposed to political and social turmoil in the country. In March 2018, Egypt held a new presidential election and President Abdel Fattah el-Sisi wasre-elected for a second term (2018 – 2022). CEMEX’s operations in Egypt have been adversely affected by the turbulence in Egypt andThroughout this time, CEMEX continueshas continued with its cement production, dispatch and sales activities asactivities. Abdel Fattah el-Sisi has been the president of the date of this annual report. We cannot assure you that theEgypt since 2014, and was reelected regime will be ablefor a second term in March 2018 (2018-2022). The current government faced unrest in 2019, due to avoid further politicalclashes between government forces and opposition protesters. Further mobilization and social turbulence. Risksturbulence cannot be discounted in the future. Egypt will hold parliamentary elections on December 31, 2020, which could lead to renewed waves of popular unrest. Additional risks to CEMEX’s operations in Egypt include a potential reduction in overall economic activity, exchange rate volatility, increased cost of energy, cement oversupply, andchanges in regulations, the threat of terrorist attacks, which could have a material adverse effect on our operations in the country.

Our operations are also exposed to the Israeli-Palestinian conflict. Confrontations between the Israeli Defense Force and Palestinians in the Gaza Strip have continued generating sporadic events of violence in the region. Progress on peace iscontinues to be stalled, asdespite efforts from third parties (including the U.S. and the United Nations) to reach an agreement. As of December 31, 2019, the parties continued to portray opposite views over the contested territory and neither side has shown intentions for making concessions. If the conflicts escalate,conflict escalates, it could have a negative impact on the geopolitics and economy in the region, which in turn could adversely affect our operations, financial condition, liquidity and results of operations.

Military activities in Ukraine and on its borders, including Russia effectively taking control of Crimea followed by Crimea’s independence vote and absorption by Russia, have combined with Ukraine’s weak economic conditions to create uncertainty in Ukraine and the global markets. In response to the annexation of the Crimean region of Ukraine by Russia and also related to2014, as well as Russia’s intervention in Syria have made the conflicts in Syria, other nations,country subject to international sanctions from different countries, including the U.S., have imposed and may continue to impose economic sanctions on Russia.the EU. While not directly impacting territories in which we had operations as of December 31, 2017, this2019, the Ukrainian dispute could negatively affect the economies of the countries in which we operate and their access to Russian energy supplies, andsupplies. In addition, the dispute could negatively impact the global economy. Further,economy as a whole. Furthermore, potential responses by Russia to those sanctions could adversely affect European economic conditions, which could have a material adverse effect on our operations mainly in Europe, and ifEurope. If conflicts with Russia escalate to military conflict, it could also have a material adverse effect on our business, financial condition, liquidity and results of operations.

In the Middle East, region, during 2017,regional tensions have intensified since the Gulf Cooperation Council splitU.S.’s withdrawal from the Joint Comprehensive Plan of Action (2018), commonly known as the Iran Nuclear Deal. The conflict escalated after General Qasem Soleimani, the Iranian Commander of the Quds Force, was killed in a way not seen since its foundation in 1981, after Saudi Arabia, the UAEU.S. drone strike, which was followed by Iranian retaliation. The Iran conflict poses a significant security and Bahrain launched a boycott of Qatar in June 2017, alleging Qatar’s support to Islamist groups. The end of the conflict does not appear to be imminent, as Qatar refuses to accept demands from Gulf Cooperation Council countries. The Qatar-Gulf crisis may have a negative economic impact on the region. Additionally, as previously mentioned, the civil war in Syria could escalate tensions betweenterrorism risk, mainly for the U.S. and Russia, Israel and Iran, and their corresponding allies.Iran’s allies in the region. Increased tensions among these countries could lead to a risk of afull military action, thatand could have the potential topotentially have a material adverse effect on our business, financial condition, liquidity and results of operations.operations, mainly in Israel and UAE. In addition, the ongoing Qatar-Gulf crisis and the civil war in Syria may have a negative economic impact on the region.

In Asia, there is considerable political instability in Taiwangeopolitical tension related to its disputes withpro-democracy protests in Hong Kong, Taiwan’s status in relation to China, and in South Korea related to itsKorea’s disputes with North Korea which also include theand disputes between the U.S. and North Korea. Similarly, mutually exclusive territorial disputes among several Southeast Asian countries in the South China Sea amplify the potential for an outbreak of hostilities.continue. A major outbreak of hostilities or other political upheaval in China, Taiwan, North Korea, or South Korea or Hong Kong could adversely affect the global economy, which could have a material adverse effect on our business, financial condition, liquidity or results of operations. In addition, China was impacted by its trade war with the U.S., which have had major implications on global trade and supply chains. A potential sharp and unexpected reduction of economic growth in China or an economic contraction of this country, could affect the global economy to an extent that could have a material adverse effect on our business, financial condition, liquidity and results of operations.

Other regions are also exposed

Numerous protests have erupted in Latin American countries, such as Colombia, Chile, Ecuador, Nicaragua, Puerto Rico among others. In addition, the region continues to political turmoil, includingbe affected by the continued political unrest in Venezuela,Venezuelan crisis, which may similarly affecthas had a major impact on the results of our operations in those regions.regional economy and poses an important social and security risk.

Further, there

There have been terrorist attacks and ongoing threats of future terrorist attacks in countries in which we maintain operations. We cannot assure you that there will not be other attacks or threats that will cause any damage to our operating units and facilities or locations, or harm any of our employees, including members of CEMEX, S.A.BS.A.B. de C.V.’s board of directors or senior management, or lead to an economic contraction or erection of material barriers to trade in any of our markets. An economic contraction in any of our major markets could affect domestic demand for cement and,our products, which could have a material adverse effect on our business, financial condition, liquidity and results of operations.

As part of our risk governance approach, from time to time we evaluate the need to address the financial consequences of political or social risk through the purchase of insurance. As a result, we purchase certain types of political risk insurance policies for selected countries where we operate and which are exposed to political turmoil, geopolitical issues or political uncertainty. These insurance policies are designed to offer some assistance to our financial flexibility to the extent that the specifics of a political incident could give rise to a financial liability. However, we cannot assure you that a given social or political event and possible changes in government policies will be covered by the political risk insurance policies we have in place, or that the amount of such insurance will be sufficient to offset the liability arising from such applicable events. Any such liability could have a material adverse effect on our business, financial condition, liquidity and results of operations.

Our operations and ability to source products and materials can be affected by adverse weather conditions and natural disasters.

Construction activity, and thus demand for our products, decreases substantially during periods of cold weather, when it snows or when heavy or sustained rainfalls occur, or generally, in general any rainy and snowy weather. Consequently, demand for our products is significantly lower during the winter or raining and snowing seasons in temperatethe countries in which we operate and during the rainy season in tropical countries.do business. Generally, winter weather in our European and North American operations significantly reduces our first quarter sales volumes, and to a lesser extent our fourth quarter sales volumes. Sales volumes in these and similar markets generally increase during the second and third quarters because of normally better weather conditions. However, high levels of rainfall and/or snow can also adversely affect our operations during these periods, as well such as our access to products and materials used in our operations (as was the case in 2017 for2018 with regard to our operations in the Philippines.Philippines, which was exacerbated by a natural landslide that affected our operations in the country). Natural disasters likesuch as the earthquake in Mexico and Hurricanes Harvey and Irma in the United StatesU.S. in 2017 could also have a negative impact on our sales volumes, which could also be material.have a material adverse effect on our results of operations. Our operations in Florida and Texas, the Caribbean and certain parts of the Gulf of Mexico are particularly exposed to hurricanes and similar weather events. This decrease in sales volumes is usually compensatedcounterbalanced by the increase in the demand offor our products during the reconstruction phase, unless any of our operating units or facilities are impacted because ofby the natural disaster. Such adverse weather conditions and natural disasters can have a material adverse effect on our business, financial condition, liquidity and results of operations if they occur with unusual intensity, during abnormal periods, or last longer than usual in our major markets, or if they cause scarcity and increases in the cost of the products we need to run our business, especially during peak construction periods.

We will be adversely affected by any significant or prolonged disruption to our production facilities.

Any prolonged and/or significant disruption to our production facilities, whether due to repair, maintenance or servicing, governmental or administrative actions, regulatory issues, civil unrest, industrial accidents, unavailability or excessively high cost of raw materials such as energy to the point of making it inefficient to run our production facilities, mechanical equipment failure, human error, natural disaster or otherwise, will disrupt and adversely affect our operations. Additionally, any major or sustained disruptions in the supply of utilities such as water or electricity or any fire, flood, earthquake, volcanic eruption, landslide or other natural calamities or communal unrest or acts of terrorism may disrupt our operations or damage our production facilities or inventories and could have a material adverse effect on our business, financial condition, liquidity and results of operations.

We typically shut down our facilities to undertake maintenance and repair work at scheduled intervals. Although we schedule shut downsshutdowns such that not all our facilities are shut down at the same time, the unexpected shut downshutdown or closure of any facility may nevertheless materially affect our business, financial condition, liquidity and results of operations from one period to another.

Additionally, cement production raises a number of health and safety issues. As is the case with other companies in our industry, some of our aggregate products contain varying amounts of crystalline silica, a common mineral. Also, some of our construction and material processing operations release, as dust, crystalline silica that is in the materials being handled. Excessive, prolonged inhalation of very small-sized particles of crystalline silica has allegedly been associated with respiratory disease (including silicosis). As part of our annual due diligence, we work with our stakeholders to verify that certain health and safety protocols are in place with regards to the management of silica and its health effects, as well as in relation to other substances and products. Nonetheless, any health issues related to cement and aggregates production can result in future claims related to exposure to these products or substances, which could have a material adverse impact on our reputation, business, financial condition, liquidity, results of operations and prospects.

Other health and safety issues related to our business include: burns arising from contact with hot cement kiln dust or dust on preheater systems; airborne hazards related to our aggregates mining activities; noise, including from chutes and hoppers, milling plants, exhaust fans and blowers; the potential for dioxin formation if chlorine-containing alternative fuels are introduced into kilns; plant cleaning and maintenance activities involving working at height or in confined or other awkward locations, and the storage and handling of coal, pet coke and certain alternative fuels, which, in their finely ground state, can pose a risk of fire or explosion; and health hazards associated with operating ready-mix concrete trucks. We may also be exposed to liability resulting from injuries or fatalities involving third-party service providers, such as drivers for our suppliers when delivering products or services to us. While we actively seek to minimize the risk posed by these issues, personal injury claims may be made, and substantial damages awarded, against us, which could have a material adverse impact on our reputation, business, financial condition, liquidity and results of operations. Additionally, we may also be required to change our operational practices, involving material capital expenditure.

Labor activism and unrest, or failure to maintain satisfactory labor relations, could adversely affect our results of operations.

Labor activism and unrest may adversely affect our operations and thereby adversely affect our business, financial condition, liquidity, results of operations and prospects. Although most of our significant operations have not been affected by any significant labor disputedisputes in the past, we cannot assure you that we will not experience labor unrest, activism, disputes or actions in the future, including as a result of labor laws and regulations that have recently been enacted or that could come into effect in the future, some of which may be significant and could adversely affect our business, financial condition, liquidity, results of operations and prospects. For example, the activity of labor unions in Mexico is expected to increase, as a result of law that permits unions to actively seek sponsorship of collective bargaining agreements. For a description of our most relevant collective bargaining agreements, see “Item 6—Directors, Senior Management and Employees—Employees.”Employees” in the 2018 Annual Report.

Increases in liabilities related to our pension plans could adversely affect our results of operations.

We have obligations under defined benefit pension and other benefit plans in certain countries in which we operate, mainly in North America and Europe. Our actual funding obligations will depend on benefit plan changes, government regulations and other factors, including changes in longevity and mortality statistics. Due to the large number of variables and assumptions that determine pension liabilities and funding requirements, which

Our success depends on the leadership of CEMEX, S.A.B. de C.V.’s board of directors and on key members of our management.executive management team.

Our success depends largely on the efforts and strategic vision of CEMEX, S.A.B. de C.V.’s board of directors and on key members of our executive management team. The loss of the services of some or all of the members of CEMEX, S.A.B. de C.V.s board ofC.V.’s directors or our executivesenior management could have a material adverse effect on our business, financial condition, liquidity and results of operations.operations, as well as on our reputation. Although we have for the last five years appointed new members to the board of directors (including to replace outgoing directors), we cannot assure you that one or more members on our board of directors will continue to change each year.

The execution of our business strategy also depends on our ongoing ability to attract and retain additional qualified employees. For a variety of reasons, particularly with respect to the competitive environment and the availability of skilled labor, we may not be successful in attracting and retaining the personnel we require. If we are unable to hire, train and retain qualified employees at a reasonable cost, we may be unable to successfully operate our business or capitalize on growth opportunities and, as a result, our business, financial condition, liquidity and results of operations could be materially and adversely affected.

We are subject to anti-corruption, anti-bribery, anti-money laundering and antitrust laws and regulations in the countries in which we operate.operate, some of which are considered high-risk countries. Any violation of any such laws or regulations could have a material adverse impact on our reputation and results of operations and financial condition.

We are subject to anti-corruption, anti-bribery, anti-money laundering, antitrust and other international laws and regulations and are required to comply with the applicable laws and regulations of the countries in which we operate.operate, some of which, including Mexico, Jamaica, Trinidad and Tobago, Colombia, Panama, Egypt, the Philippines, El Salvador, the Dominican Republic, Guatemala, Nicaragua, and Haiti, are considered high-risk countries with regard to corruption-related matters. In addition, we are subject to regulations on economic sanctions that restrict our dealings with certain sanctioned countries, individuals and entities. Given the large number of contracts that we are a party to around the world, the geographic distribution of our operations and the great variety of actors that we interact withinwith in the course of business, we are subject to the risk that our affiliates, employees, directors, officers, partners, agents and service providers may misappropriate our assets, manipulate our assets or information, make improper payments or engage in corruption, bribery, money laundering or other illegal activity, for such person’s personal or business advantage.

There can be no assurance that our internal policies and procedures will be sufficient to prevent or detect all inappropriate practices, fraud or violations of law by our affiliates, employees, directors, officers, partners, agents

U.S. upon such persons or to enforce against them or against us in U.S. courts judgments predicated upon the civil liability provisions of the federal securities laws of the United States.U.S. We have been advised by our General Counsel, Roger Saldaña Madero, that there is doubt as to the enforceability in Mexico, either in original actions or in actions for enforcement of judgments of U.S. courts, of civil liabilities predicated on the U.S. federal securities laws.

The protections afforded tonon-controlling shareholders in Mexico are different from those in the United StatesU.S. and may be more difficult to enforce.

Under Mexican law, the protections afforded tonon-controlling shareholders are different from those in the United States.U.S. and countries in continental Europe. In particular, the legal framework and case law pertaining to directors’ duties and disputes between shareholders and us, the members of CEMEX, S.A.B. de C.V.’s board of directors, our officers or CEMEX, S.A.B. de C.V.’s controlling shareholders, if any, are less developed under Mexican law than under U.S. and continental European law. Mexican law generally only permits shareholder derivative suits (i.e., suits for our benefit as opposed to the direct benefit of our shareholders) and there are different procedural requirements for bringing shareholder derivative lawsuits, such as shareholder derivative suits,minimum holdings, which differ from those you may be familiar with under U.S. andin effect in other laws.jurisdictions. There is also a substantially less active plaintiffs’ bar dedicated to the enforcement of shareholders’ rights in Mexico than in the United States.U.S. As a result, in practice it may be more difficult for ournon-controlling shareholders to enforce their rightsinitiate an action against us or our directors or controlling shareholders or obtain direct remedies than it would be for shareholders of a U.S. company.

Preemptive rights may be unavailable to ADS holders.

ADS holders may be unable to exercise preemptive rights granted to CEMEX, S.A.B. de C.V.’s shareholders, in which case ADS holders could be substantially diluted following future equity or equity-linked offerings. Under Mexican law, whenever CEMEX, S.A.B. de C.V. issues new shares for payment in cash or in kind, CEMEX,

Between January 1, 2018 and April 20, 2018, the Mexican Peso appreciated by approximately 6% against the U.S. Dollar, based on the noon buying rate for Mexican Pesos.

For a discussion of the financial treatment of our operations conducted in other currencies, see “Item 3—Key Information—Selected Consolidated Financial Information” included elsewhere in this annual report.

“assets held for sale,” including a proportional allocation of goodwill of $49 million, and “liabilities directly related to assets held for sale,” respectively. Moreover, for purposes of the income statements for the years ended December 31, 2017, 2018 and 2019 the operations related to this segment are presented net of tax in the single line item “Discontinued operations.” See “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Our Assets Divestiture Plans” for more information regarding this transaction.

On November 26, 2019, we announced that our U.S. affiliate Kosmos Cement Company (“Kosmos”), a partnership with a subsidiary of BUZZI Unicem S.p.A. in which CEMEX held a 75% interest, entered into a binding agreement for the sale of certain assets to Eagle Materials Inc. (“Eagle Materials”) for $665 million. The divestment successfully closed on March 6, 2020. The share of proceeds to us from this transaction was $499 million, minus transaction costs. The assets that were divested consisted of the Kosmos cement plant in Louisville, Kentucky, as well as related assets which include seven distribution terminals and raw material reserves. As of December 31, 2019, the assets and liabilities associated with the sale of the Kosmos cement plant in Louisville, Kentucky, and related assets in the U.S. Dollar amountare presented in the statement of financial position within the line items of “assets held for sale,” including a proportional allocation of goodwill of $291 million, and “liabilities directly related to assets held for sale,” respectively. Moreover, for purposes of the income statements for the years ended December 31, 2017, 2018 and 2019 the operations related to this segment are presented net of income tax in the single line item “Discontinued operations.” See “Item 5—Operating and Financial Review and Prospects—Recent Developments—Recent Developments Relating to Our Assets Divestiture Plans” for more information regarding this transaction.

On June 28, 2019, after obtaining customary authorizations, we closed with several counterparties the sale of our ready-mix and aggregates business in the central region of France for an aggregate price of €31.8 million ($36.2 million). Our operations of these disposed assets in France for the period from January 1 to June 28, 2019 and for the years ended December 31, 2017 and 2018 are reported in the income statements, net of income tax, in the single line item “Discontinued operations,” including in 2019 a gain on sale of $17 million net of a proportional allocation of goodwill related to this reporting segment of $8 million.

On May 31, 2019, we concluded the sale of our aggregates and ready-mix assets in the North and North-West regions of Germany to GP Günter Papenburg AG for €87 million ($97 million). The assets divested in Germany consisted of four aggregates quarries and four ready-mix facilities in North Germany, and nine aggregates quarries and 14 ready-mix facilities in North-West Germany. Our operations of these disposed assets for the period from January 1 to May 31, 2019 and for the years ended December 31, 2017 and 2018 are reported in the income statements net of income tax in the single line item “Discontinued operations,” including in 2019 a gain on sale of $59 million.

On March 29, 2019, we closed the sale of our businesses in the Baltics and Nordics to the German building materials group Schwenk ZementKG (“Schwenk”) for a price in Euro equivalent to $387 million. The divested Baltic assets consisted of one cement production plant in Broceni with a production capacity of 1.7 million tons, four aggregates quarries, two cement quarries, six ready-mix plants, one marine terminal and one land distribution terminal in Latvia. The divested assets also included our 37.8% indirect interest in one cement production plant in Akmene, Lithuania with a production capacity of 1.8 million tons, as well as the exports business in Estonia. The divested Nordic assets consisted of three import terminals in Finland, four import terminals in Norway and four import terminals in Sweden. Our operations of these disposed assets for the period from January 1 to March 29, 2019 and for the years ended December 31, 2017 and 2018 are reported in the income statements net of income tax in the single line item “Discontinued operations,” including a gain on sale of $66 million in 2019.

On March 29, 2019, we entered into a binding agreement with Çimsa Çimento Sanayi Ve Ticaret A.Ş. to divest our white cement business outside of Mexico and the U.S. for $180 million, including our Buñol cement plant in Spain and our white cement customers list. The closing of the transaction andis subject to approval by Spanish authorities. As of the corresponding Mexican Peso amount that is presenteddate of this annual report, we expect to close the transaction during the first half of 2020, but we are not able to assess if COVID-19 will delay the closing of this divestment or prevent us from closing. Our operations of these assets in our 2017 audited consolidated financial statements. These translations have been prepared solelySpain for the convenience of the reader and should not be construed as representations that the Mexican Peso amounts actually represent those Dollar amounts or could be converted into Dollars at the rate indicated. The noon buying rate for Mexican Pesos onyears ended December 31, 2017, was Ps19.64 to U.S.$1.00. Between January 1, 2018 and April 20,2019 are reported in the income statements, net of income tax, in the single line item “Discontinued operations.”

On September 27, 2018, we concluded the Mexican Peso appreciated by approximately 6% againstsale of our construction materials operations in Brazil (the “Brazilian Operations”) through the sale to Votorantim Cimentos N/NE S.A. of all the shares of our Brazilian subsidiary Cimento Vencemos Do Amazonas Ltda., consisting of a fluvial cement distribution terminal located in Manaus, Amazonas province, as well as the operating license. The sale price was $31 million.

On June 30, 2017, we concluded the sale of our Pacific Northwest Materials Business (the “Pacific Northwest Materials Business”) consisting of aggregate, asphalt and ready-mix concrete operations in Oregon and Washington to Cadman Materials, Inc. (“Cadman Materials”), a subsidiary of HeidelbergCement Group, for $150 million. We recorded a net gain on disposal of these assets of $22 million, which included a proportional allocation of goodwill of $73 million. The operations of our Pacific Northwest Materials Business for the six-month period ending June 30, 2017 are reported in the income statements, net of income tax, in the single line item “Discontinued operations.”

On January 31, 2017, we concluded the sale of our Concrete Reinforced Pipe Manufacturing Business (“Concrete Pipe Business”) in the U.S. Dollar,to Quikrete Holdings, Inc. (“Quikrete”) for $500 million plus a potential contingent consideration based on future performance of $40 million. We determined a net gain on disposal of these assets of $148 million which included a proportional allocation of goodwill of $260 million. The operations of the noon buying rateConcrete Pipe Business for Mexican Pesos.