How Does Cydsa Company Work?

Cydsa extracts salt through solution mining, serving both household and industrial markets. This process also creates underground cavities utilized for hydrocarbon storage, showcasing an integrated approach to resource management.

The company manufactures chlorine, caustic soda, and related specialty chemicals. A new plant in Coatzacoalcos, Veracruz, boosted capacity from 192,000 ECUs in 2022 to 322,000 ECUs in 2024, significantly increasing domestic market supply.

Through a joint venture, Cydsa is the sole manufacturer of refrigerant gases in Mexico. This operation serves domestic and international markets, primarily in Latin America and the USA.

Cydsa operates two energy cogeneration plants in Coatzacoalcos, Veracruz, with a combined capacity exceeding 114 megawatts. These facilities supply electricity and steam to its operations and the national grid.

A major milestone for Cydsa company operations is the near completion of its new chlorine and caustic soda plant in Coatzacoalcos, Veracruz. This facility, utilizing membrane technology, significantly boosts annual production capacity by nearly 70%, from 192,000 ECUs to 322,000 ECUs by the end of 2024.

Cydsa has strategically invested in its Electricity and Steam Cogeneration business, with two plants operational since 2014 and 2016, each capable of producing 57 megawatts of electrical energy. These plants are designed to meet internal energy demands and participate in the domestic electricity market.

In late 2024 and early 2025, an unforeseen event impacted one of the cogeneration plants, leading to reduced capacity and increased electricity purchases from the Federal Electricity Commission. Cydsa anticipates restoring this capacity in the fourth quarter of 2025.

Cydsa's competitive edge is built on a diversified product range, vertical integration, and technological innovation. Its unique position as the sole Mexican manufacturer of refrigerant gases through Quimobásicos is a key differentiator.

Cydsa is a key player in Mexico's industrial landscape, with a significant market share in chemicals, petrochemicals, textiles, and energy. Its unique position as the sole manufacturer of refrigerant gases in Mexico, through the Quimobásicos joint venture, further strengthens its competitive advantage. The company's broad reach extends to over 15 countries, highlighting its international market penetration.

The company navigates several risks, including currency fluctuations, which impacted sales in Q1 2025 due to peso depreciation. Increased natural gas and energy costs, stemming from a temporary plant suspension in late 2024 and early 2025, also affected profitability, leading to a lower EBITDA margin of 26.9% in Q1 2025. Regulatory changes and new market entrants present ongoing challenges.

Cydsa anticipates a revenue compound annual growth rate of 8.5% between 2023 and 2026. The company expects to fully restore its cogeneration plant capacity by the fourth quarter of 2025. Investments in new facilities, such as the chlorine and caustic soda plant, are projected to boost sales and contribute to an estimated average EBITDA margin of 31.1% for 2024-2026.

In 2024, Cydsa updated its sustainability strategy to focus on environmental, social, and governance (ESG) factors, aiming for long-term resilience and value creation. This strategic focus is crucial for how Cydsa manages its operations and ensures its approach to innovation aligns with broader corporate responsibility goals. Understanding the Target Market of Cydsa is integral to these forward-looking initiatives.