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UPDATE 4-Cemex cuts 2010 growth views amid challenging US

* Company posts net loss; U.S. cement volumes grew

* Spain still weak, volumes fell by almost a quarter

* Cemex stock down 2.4 pct in Mexico, 2.7 pct in U.S.

* Price increases in October for western U.S. (Releads, adds comments on price rise, EBITDA outlook, updates stock quote, debt situation, adds bylines)

By Robin Emmott and Gabriela Lopez

MONTERREY, Mexico, July 27 (Reuters) - Cemex cut its 2010 growth estimates on Tuesday after posting disappointing quarterly results as the world’s No. 3 cement maker struggles with bleak sales in the United States and Europe.

Monterrey-based Cemex CMXCPO.MXCX.N reduced its forecast for 2010 earnings before interest, tax, depreciation and amortization to $2.65 billion, from $2.75 billion, but said that it may be able to nearly double that amount within five years.

“Given the likely increase in fiscal austerity in response to the European debt crisis, we now see lower contribution from this region as well as slower growth in the United States,” Fernando Gonzalez, executive vice president of planning and finance, told analysts during a conference call.

Earlier on Tuesday, the company said it lost $306 million in the April-June period, below the $84 million profit forecast on average in a Reuters poll. Cemex earned $186.5 million in the second quarter of 2009.

The company’s stock was down 1.9 percent in Mexico City following the earnings report and its New York-traded shares lost 2 percent.

“Cemex has been unable to turn around its finances; they continue to be weak,” said Gerardo Sienra, a stock trader at Actinver brokerage in Mexico City.

The company also cut its 2010 free cash flow view to $680 million although generation has been sufficient to meet debt payments. Gonzalez said Cemex, which narrowly avoided default last year after striking a deal with creditors, paid close to $650 million in debt during the second quarter.

TOUGH US MARKET

Cemex said second-quarter revenue fell 3 percent from a year earlier to $3.8 billion. EBITDA dropped 13 percent to $664 million.

Cemex reported a drop of 8 percent in net sales to $684 million in the United States, compared with the same period in 2009. But U.S. volumes of gray cement and ready-mix rose 8 percent and 3 percent respectively, a crucial sign that demand may be slowly returning in the company’s top market.

The U.S. housing market showed signs of recovery earlier this year but has stumbled since a special tax credit for homebuyers expired at the end of April.

The company said it will boost prices per tonne in some areas of the United States in the fourth quarter.

“Right now we have a price increase announcement for all of our products from October 1st in what we call the West, which is pretty much west of the Mississippi, of $11 in the case of cement, about $13 in the case of ready mix and $1 in aggregates,” Gilberto Perez, head of Cemex’s U.S. operation, said during the conference call.

Sales of new U.S. homes surged in June, but other data has left in place a picture of a weak housing market in the United States, Cemex’s biggest market.

Cemex said much of the growth in its U.S. business would come from public spending and that an improved economy would give a slight boost to the residential sector.

Investors in Cemex, which competes with Switzerland's Holcim HOLN.VX and France's Lafarge LAFP.PA, are anxious to see an improvement in volumes in the United States following a very tough 2009.

Cemex bought Australian rival Rinker in 2007, which had 80 percent of its operations in the United States, just as the U.S. housing crisis broke and the global recession ensued.

The acquisition, one of the largest ever for an emerging markets company, made Cemex the top cement maker in the United States and means its recovery is now very closely tied to the world’s biggest economy. But the outlook is still mixed.

“Infrastructure spending during the quarter improved,” Cemex said in its earnings statement, referring to the United States. However, the company added that demand in the U.S. industrial and commercial sectors was still sluggish.

In Europe, net sales for the second quarter fell 10 percent to $1.3 billion. Cemex told Reuters earlier this year that Spain, another key market, would remain weak for the time being.

Gonzalez told a press conference that Cemex should generate $5 billion in annual EBITDA within five years. (Additional reporting by Cyntia Barrera Diaz and Michael O’Boyle in Mexico City, editing by Dave Zimmerman, Matthew Lewis and Gunna Dickson)

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