PUERTO RICAN CEMENT CO INC, DEF 14A, 1998-02-02

PUERTO RICAN CEMENT CO INC
DEF 14A, 1998-02-02
CEMENT, HYDRAULIC

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<PAGE> 1

SCHEDULE 14A
(RULE 14A-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>

PUERTO RICAN CEMENT COMPANY, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

(1) Title of each class of securities to which transaction applies:

(2) Aggregate number of securities to which transaction applies:

(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):

(4) Proposed maximum aggregate value of transaction:

(5) Total fee paid:

[ ] Fee paid previously with preliminary materials:

[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

(2) Form, Schedule or Registration Statement No.:

(3) Filing Party:

(4) Date Filed:
<PAGE> 2

PUERTO RICAN CEMENT COMPANY, INC.
---------------------

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

MAY 1, 1996

---------------------

The annual meeting of stockholders of Puerto Rican Cement Company, Inc.
(the "Company") will be held at the office of the Company, Amelia Industrial
Park, Guaynabo, Puerto Rico, on Wednesday, May 1, 1996 at 10:00 a.m. Atlantic
Standard Time for the following purposes:

1. The election of six Class III directors for a term of three years and
until election and qualification of their successors.

2. The transaction of such other business as may lawfully come before the
meeting or any adjournment thereof.

Only stockholders of record at the close of business on March 15, 1996 will
be entitled to vote at the meeting.

It is important that your stock be represented at the meeting. If you do
not expect to be present, you are urged to date, sign and mail promptly the
enclosed proxy. For your convenience, we enclose a self-addressed envelope to
which no postage need be affixed if mailed in the United States or Puerto Rico.

The Company's executive office is located in Guaynabo, Puerto Rico. Its
mailing address is P.O. Box 364487, San Juan, Puerto Rico 00936-4487. It is
anticipated that the proxy material will be mailed to stockholders on or about
March 29, 1996.

By Order of the Board of Directors

Jose O. Torres
Secretary

Guaynabo, Puerto Rico
March 29, 1996
<PAGE> 3

PUERTO RICAN CEMENT COMPANY, INC.
---------------------

PROXY STATEMENT
---------------------

ANNUAL MEETING OF STOCKHOLDERS, MAY 1, 1996

The enclosed proxy is being solicited by the Board of Directors of the
Company for the annual meeting of stockholders to be held on May 1, 1996. This
proxy statement and the accompanying Notice of Annual Meeting of Stockholders
and proxy card are being mailed to stockholders beginning on or about March 29,
1996. In addition to solicitation by mail, solicitation of proxies may be made
personally or by telephone or other means by the Company's regular employees. If
the proxy is executed and returned in time for voting, the
shares represented thereby will be voted. Stockholders have the right to revoke
their proxies at any time prior to the time their shares are actually voted. If
revocation is made by mail, it should be sent to Jose O. Torres, Secretary,
Puerto Rican Cement Company, Inc., P.O. Box 364487, San Juan, Puerto Rico
00936-4487.

The cost of solicitation will be paid by the Company. The Company has
retained the services of Georgeson & Co., Inc., New York, New York, to assist in
the solicitation of proxies at a cost of $6,000.00. Brokers, nominees and other
similar record holders will be requested to forward proxies and proxy materials
to the beneficial owners of the shares and will be reimbursed by the Company for
their expenses.

VOTING SECURITIES

As of March 15, 1996, the Company had outstanding 5,504,722 shares
(exclusive of 495,278 treasury shares) of Common Stock, par value $1 per share.
Each outstanding share of Common Stock is entitled to one vote. Only
stockholders of record at the close of business on March 15, 1996 will be
entitled to vote at the meeting. For information regarding principal holders of
the Company's Common Stock, see "Information about Nominees, Directors, and
Principal Stockholders" below.

ELECTION OF DIRECTORS

The current Class I directors are Carlos J. Suarez, Hector Puig Ramirez,
Oscar A. Blasini, Luis Alberto Ferre Rangel, Miguel A. Nazario, and Hector del
Valle. The current Class II directors are Rosario J. Ferre, Esteban D. Bird,
Federico F. Sanchez, Jorge L. Fuentes, Juan A. Albors and Federico M. Stubbe.
The Class III directors are Antonio Luis Ferre, Alberto M. Paracchini, Jose J.
Suarez, Jose Angel Fernandez Paoli, Emilio J. Venegas and Antonio Luis Ferre
Rangel. Each class serves a three-year term, which terms are currently to expire
on the date of the respective annual meetings as follows: Class I, 1997; Class
II, 1998; and Class III, 1996. At the Board meeting held in December 1995, Mr.
Mariano J. Mier resigned as a Class I director and at its meeting of February
1996 the Board named Luis Alberto Ferre Rangel to the Class I position left
vacant by Mr. Mier. In May 1995, Class III director, Wallace Gonzalez Oliver
passed away and at its meeting of August 1995 the Board named Jose Angel
Fernandez Paoli to the Class III position left vacant by Mr. Oliver.

It is anticipated that the proxy will be voted for the individual nominees
for Class III directors named below, unless authority is withheld to vote for
all or any of such individuals as indicated on the proxy card. The names of the
nominees for Class III directors are: Antonio Luis Ferre, Alberto M. Paracchini,
Jose J. Suarez,
<PAGE> 4

Jose Angel Fernandez Paoli, Emilio J. Venegas and Antonio Luis Ferre Rangel. All
are directors at the present time.

Pursuant to the Company's By-laws, the election of any director requires an
affirmative vote of a majority of the votes of the Company's Common Stock
represented at the Annual Meeting in person or by proxy and entitled to vote on
that proposal. Votes cast by proxy or in person at the Annual Meeting will be
counted by the persons appointed by the Company to act as election inspectors
for the meeting. The election inspectors will treat shares represented by
proxies that reflect abstentions as shares that are present and entitled to vote
for purposes of determining the presence of a quorum. Abstentions, however, will
constitute a vote "against" any proposal. The election inspectors will treat
"broker non-votes" (i.e. shares held by brokers or nominees as to which
instructions have not been received from the beneficial owners or persons
entitled to vote and with respect to which the broker or nominee does not have
discretionary power to vote on a particular matter) as if the broker never
voted. If no directive is given, with respect to each proposal, the proxy will
be tallied as a vote "for" management.

Each Class III director elected at this meeting shall serve from the time
of election and qualification until the third annual meeting following election
and until a successor shall have been elected and shall have qualified. If any
nominee is unable to serve as a director, an event which the Company does not
now anticipate, the proxy will be voted for a substitute nominee.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF EACH OF THE CLASS
III DIRECTOR NOMINEES NAMED ABOVE.

INFORMATION ABOUT NOMINEES, DIRECTORS AND PRINCIPAL STOCKHOLDERS

2
<PAGE> 5

<TABLE>
<CAPTION>
NUMBER OF SHARES
AND PERCENTAGE OF
OUTSTANDING SHARES
SERVED AS OF COMMON STOCK
PRINCIPAL OCCUPATION DIRECTOR OWNED BENEFICIALLY
NAME AGE FOR THE LAST FIVE YEARS SINCE(A) AT MARCH 15, 1996
- ---------------------------- --------------------------------------- --------- ------------------
<S> <C> <C> <C> <C>
Miguel A. Nazario 48 President and Chief Executive Officer 1994 None
of the Company since January 1995 and
Vice President from August 1994
through December 1994; Process
Manager for Worldwide Manufacturing
of Digital Equipment Corp. (computer
company) from 1993 to 1994; Manager
for U.S. and Latin American
Operations of Digital Equipment Corp.
from 1992 to 1993; President and
General Manager of Puerto Rican
Operations of Digital Equipment Corp.
from 1987 to 1992.
Hector del Valle 58 Vice Chairman of the Board of the 1987 None
Company since January, 1, 1995,
President from 1988 to December 1994,
Director since 1987 and Senior Vice
President -- Finance and Secretary
from 1983 to 1987.
Luis Alberto Ferre
Rangel 29 Business Editor, since February 1995, 1996 23,876(d)
Assistant Editor from August 1992 to (0.43%)
January 1995, Reporter from February
1990 to July 1992 of El Dia Inc.
(newspaper) (an adult son of Antonio
Luis Ferre).
CLASS II DIRECTORS
Rosario J. Ferre 57 Second Vice President since 1983 and 1992 32,688(c)
Director since 1960 of Luis A. Ferre (0.59%)
Foundation, Inc. and Ponce Museum of
Art (non profit foundation) (an adult
daughter of Luis A. Ferre and sister
of Antonio Luis Ferre).
Esteban D. Bird 64 President of Bird Construction Company 1973 None
(general contractors) since 1964;
Director of BanPonce Corporation
(bank holding company) and of Banco
de Ponce (commercial bank) from 1989
to 1990; Director of Banco Popular de
Puerto Rico (commercial bank) since
1991.
</TABLE>

3
<PAGE> 6

<TABLE>
<CAPTION>
NUMBER OF SHARES
AND PERCENTAGE OF
OUTSTANDING SHARES
SERVED AS OF COMMON STOCK
PRINCIPAL OCCUPATION DIRECTOR OWNED BENEFICIALLY
NAME AGE FOR THE LAST FIVE YEARS SINCE(A) AT MARCH 15, 1996
- ---------------------------- --------------------------------------- --------- ------------------
<S> <C> <C> <C> <C>
Federico F. Sanchez 54 President of Federico F. Sanchez and 1982 366(b)
Company, Inc. since 1977; President
of Interlink Group Inc. (real estate
consultants, brokers and developers)
since 1986.
Jorge L. Fuentes 47 Chairman of the Board and Chief 1984 None
Executive Officer of Gabriel Fuentes,
Jr. Construction Company, Inc.
(general contractors) since 1986;
Chairman of the Board, Chief
Executive Officer and Director of
Fuentes Concrete Pile Inc.
(manufacturers of concrete pile
foundations) since 1986; Director of
the Bank and Trust of Puerto Rico
(commercial bank and trust) since
1988.
Juan A. Albors 59 Chairman and Chief Executive Officer of 1986 2,100(b)
Albors Housing Development
Corporation (real estate developers
and investors) since 1977; Director
of BanPonce Corporation (bank holding
company) and Banco de Ponce
(commercial bank) from 1984 to 1990;
Director of Banco Popular de Puerto
Rico (commercial bank) since 1990;
member from 1985 to 1993 and
Chairman, from 1989 to 1993, of the
Board of Governors of the Puerto Rico
Maritime Shipping Authority.
Federico M. Stubbe 47 President of Comunidades Fermaral Inc. 1993 None
(residential real estate developers)
since 1987.
</TABLE>

4
<PAGE> 7

<TABLE>
<CAPTION>
NUMBER OF SHARES
AND PERCENTAGE OF
OUTSTANDING SHARES
SERVED AS OF COMMON STOCK
PRINCIPAL OCCUPATION DIRECTOR OWNED BENEFICIALLY
NAME AGE FOR THE LAST FIVE YEARS SINCE(A) AT MARCH 15, 1996
- ---------------------------- --------------------------------------- --------- ------------------
<S> <C> <C> <C> <C>
CLASS III DIRECTORS AND NOMINEES
Antonio Luis Ferre 62 Chairman of the Board of the Company 1959 491,271(d)
since January 1, 1995, Vice Chairman (8.93%)
from 1985 through December 1994 and
Chairman from 1980 through 1985;
President of El Dia, Inc. (newspaper
publishing company) since 1969;
Director of Metropolitan Life
Insurance Company of New York
(insurance company) from 1987 to 1995
and Member of the Directors Advisory
Committee since 1995; Director and
Vice Chairman of BanPonce Corporation
(bank holding company) since 1984 and
Banco de Ponce (commercial bank) from
1959 to 1990; Director and Vice
Chairman of Banco Popular de Puerto
Rico (commercial bank) since 1991;
Director of Pueblo Extra Supermarkets
(food retailer) from 1993 to 1995
(father of Antonio Luis Ferre Rangel
and Luis Alberto Ferre Rangel, adult
son of Luis A. Ferre and brother of
Rosario J. Ferre).
Alberto M. Paracchini 63 Vice Chairman of the Board of the 1968 None
Company and Director since 1968;
Chairman of the Board and Chief
Executive Officer from 1983 to 1990
and President from 1980 to 1990 of
Banco de Ponce (commercial bank);
President from 1984 to 1990 and
Director and Chairman of the Board
from 1985 to 1993 of BanPonce
Corporation (bank holding company);
Chairman of the Board from 1986 to
1993 of Vehicle Equipment Leasing
Corporation (automobile leasing
company); Director since 1991 and
Chairman of the Board from 1991 to
1993 of Banco Popular de Puerto Rico
(commercial bank), Popular Leasing &
Rental, Inc. and Popular Consumer
Services, Inc; Director of HDA
Management Corporation since December
1993, Equus Management Co. since
August 1994 and Venture Capital Fund
since March 1994.
</TABLE>

5
<PAGE> 8

<TABLE>
<CAPTION>
NUMBER OF SHARES
AND PERCENTAGE OF
OUTSTANDING SHARES
SERVED AS OF COMMON STOCK
PRINCIPAL OCCUPATION DIRECTOR OWNED BENEFICIALLY
NAME AGE FOR THE LAST FIVE YEARS SINCE(A) AT MARCH 15, 1996
- ---------------------------- --------------------------------------- --------- ------------------
<S> <C> <C> <C> <C>
Jose Angel Fernandez 56 Attorney at Law and Partner in the law 1995 None
Paoli firm of Martinez-Alvarez,
Fernandez-Paoli, Menendez-Monroig,
Menendez-Cortada & Lefranc-Romero
since 1966; from August 1988 to
October 1994 director of Oriental
Bank and Trust (commercial bank).
Emilio J. Venegas 68 President of Sanson Corporation (rock 1977 33,000
and concrete products) since 1983; (0.6%)
Secretary of Venegas Construction
Corporation (general contractors)
since 1989; Director of BanPonce
Corporation (bank holding company)
since 1984 and Banco de Ponce
(commercial bank) from 1973 to 1990.
Jose J. Suarez 60 Consultant to the Company since January 1989 None
1996, Executive Vice President in
Charge of Operations of the Company
from 1988 until 1995, Senior Vice
President -- Operations from 1983 to
1987; Director of Scotia Bank of
Puerto Rico (commercial bank) since
February 1992.
Antonio Luis Ferre
Rangel 29 Vice-President Operations and Strategic 1993 23,876(d)
Planning of the Company since January (0.43%)
1996; Vice President -- Strategic
Planning of the Company from 1994 to
1995 and Assistant Plant Manager of
the Company from 1992 to 1994 (an
adult son of Antonio Luis Ferre).
All Directors and Executive Officers 607,927(e)
as a Group (19 persons in total including
those listed above)
</TABLE>

- ---------------

(a) Dates refer to periods served as a director of either the Company or Ponce
Cement Corporation, which was merged into the Company on March 14, 1963.
(b) Number of shares set forth represents in each case less than 0.10% of the
outstanding shares of Common Stock.
(c) 32,688 shares (0.59%) of the Company's Common Stock are held as follows: (1)
direct ownership by Rosario J. Ferre, director of the Company, of 2,688
shares (0.05%) of the Company's Common Stock; and (2) through her 100%
ownership of R.F.T Investment Corp., a Puerto Rico corporation, which owns
of record 30,000 shares (0.54%) of the Company's Common Stock. In addition,
Rosario J. Ferre shares voting and investment power regarding 537,174
shares (9.76%) of the Company's Common Stock held of

6
<PAGE> 9

record by South Management Corporation, which corporation is wholly owned
by Papelera Nacional, Inc., a Puerto Rico corporation, which in turn is
wholly owned by Sanber Investments S.A. Rosario J. Ferre has a 12.5%
ownership interest in Sanber Investments S.A. and shares voting and
investment power with Mr. Luis A. Ferre and Mr. Antonio Luis Ferre as a
result of a contract arrangement dated April 21, 1989 and subsequent court
rulings of the Puerto Rico Superior Court granting said powers to the Board
of Directors of South Management Corporation of which Mrs. Ferre is a
member. (See also final footnote on page 9).
(d) 276,804 shares (5.03%) of the outstanding Common Stock are held by Ferre
Investment Fund, Inc., a Puerto Rico corporation wholly owned by Antonio
Luis Ferre, a director of the Company since 1959, and his family. Out of
this total, Antonio Luis Ferre Rangel and Luis Alberto Ferre Rangel, adult
sons of Antonio Luis Ferre, each claim beneficial ownership of 8,238 shares
(0.15%), Antonio Luis Ferre retains sole voting power with respect to the
total shares owned by Ferre Investment Fund, Inc. and claims beneficial
ownership of the remaining 260,328 shares (4.73%). 262,219 shares (4.76%)
of the outstanding Common Stock are held by El Dia, Inc., a Puerto Rico
corporation, 86.82% owned by Antonio Luis Ferre and his family. Out of this
total, Antonio Luis Ferre Rangel and Luis Alberto Ferre Rangel, adult sons
of Antonio Luis Ferre, each claim beneficial ownership of 15,638 shares
(0.28%), Antonio Luis Ferre retains shared voting power with respect to
84.6% of the total shares owned by El Dia, Inc. and claims beneficial
ownership of 230,943 shares (4.20%). In addition, Antonio Luis Ferre shares
voting and investment power regarding 537,174 shares (9.76%) of the
Company's outstanding Common Stock held of record by South Management
Corporation, which corporation is wholly owned by Papelera Nacional, Inc.,
a Puerto Rico corporation, which in turn is wholly owned by Sanber
Investments S.A. Antonio Luis Ferre has a 12.5% ownership interest in
Sanber Investments S.A. and shares voting and investment power with Mr.
Luis A. Ferre and Mrs. Rosario J. Ferre as a result of a contract
arrangement dated April 21, 1989 and subsequent court rulings of the Puerto
Rico Superior Court granting said powers to the Board of Directors of South
Management Corporation of which Mr. Ferre is a member. (See also final
footnote on page 9).
(e) All of the directors and executive officers of the Company as a group,
including officers not listed, own 607,927 shares (11.04%) of the Company's
Common Stock and, as described above, Antonio Luis Ferre and Rosario J.
Ferre share voting power and investment regarding 537,174 shares (9.76%) of
the Company's Common Stock held of record by South Management Corp.

7
<PAGE> 10

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

In addition to the directors listed above who beneficially own more than 5%
of the outstanding shares of the Company's Common Stock, the following persons
beneficially own 5% or more of the outstanding shares of Common Stock.

<TABLE>
<CAPTION>
NUMBER OF SHARES AND PERCENT OF
BENEFICIAL OWNERSHIP OUTSTANDING
NAME AND ADDRESS AS OF MARCH 15, 1996 SHARES
- ------------------------------- -------------------- -----------
<S> <C> <C>
Luis A. Ferre
G.P.O. Box 6108
San Juan, Puerto Rico 00936 (a)* (a)*

Herman Ferre, Jr.
Hato Rey Tower
Floor 18 Suite 1804
Ave. Munoz Rivera 268
Hato Rey, Puerto, Rico 00919 (b)* (b)*

Charles M. Royce
Quest Management Company
Quest Advisory Corp.
1414 Avenue of the Americas
New York, New York 10019 401,000(c) 7.28%(c)

Ryback Management Corporation
7711 Carondelet Ave. Ste 700
P.O. Box 16900
St. Louis, Missouri 63105 321,800(d) 5.85%(d)

Capital Research and
Management Company
333 South Hope Street
Los Angeles, California 90071 371,000(e) 6.74%(e)
</TABLE>

- ---------------

(a) As of March 15, 1996, Luis A. Ferre (father of Antonio Luis Ferre and
Rosario J. Ferre), while not directly owning of record any shares of the
Company's outstanding Common Stock, had a beneficial interest in 485,247
shares (8.81%) of the Company's outstanding Common Stock through the Luis
A. Ferre Foundation, Inc., a charitable foundation, respecting which Mr.
Ferre, as its President, votes the Company's Common Stock owned of record
by the Foundation. In addition, Luis A. Ferre shares voting and investment
power regarding 537,174 shares (9.76%) of the Company's outstanding Common
Stock held of record by South Management Corporation, which corporation is
wholly owned by Papelera Nacional, Inc., which in turn is 100% owned by
Sanber Investments S.A. Luis A. Ferre has a 25% ownership interest in
Sanber Investments S.A. and shares voting and investment power with Mr.
Antonio Luis Ferre and Mrs. Rosario J. Ferre as a result of a contract
arrangement dated April 21, 1989 and subsequent court rulings of the Puerto
Rico Superior Court granting said powers to the Board of Directors of South
Management Corporation of which Mr. Ferre is a member. (See also final
footnote on page 9).

(b) As of March 15, 1996, Herman Ferre, Jr. (a first cousin of Antonio Luis
Ferre and Rosario J. Ferre) owned 95,366 shares (1.73%) of the outstanding
Common Stock of the Company. In addition, Herman Ferre, Jr. and his wife
and children have a beneficial interest and investment power regarding

8
<PAGE> 11

537,174 shares (9.76%) of the Company's outstanding Common Stock held of
record by Brim Incorporado, which corporation is wholly owned by Papelera
Nacional, Inc., a Puerto Rico corporation, which in turn is wholly owned by
Sanber Investments S.A. Herman Ferre, Jr. has a 50% ownership interest in
Sanber Investments S.A. and has voting and investment power as a result of
a contract arrangement dated April 21, 1989 and subsequent court rulings of
the Puerto Rico Superior Court granting said powers to the Board of
Directors of Brim Incorporado of which Mr. Ferre is a member. (See also
final footnote on page 9).

(c) Charles M. Royce, a U.S. citizen, Quest Advisory Corp. ("Quest"), a New York
corporation, and Quest Management Company ("QMC"), a Connecticut general
partnership, as a group, are the beneficial owners of 401,000 shares
(7.28%) of the Company's outstanding Common Stock. Mr. Charles M. Royce is
deemed to be a controlling person of QMC and Quest. QMC has 18,700 shares
(0.34%) of the Company's outstanding Common Stock registered in its name
and Quest has 382,300 shares (6.94%) of the Company's outstanding Common
Stock registered in its name. Both are registered investment advisers.
Quest and QMC have sole dispositive and voting power regarding their
respective portions of the Company's outstanding Common Stock.

(d) Ryback Management Corporation ("RMC"), a Missouri corporation, is the
beneficial owner of 321,800 shares (5.85%) of the Company's outstanding
Common Stock. RMC is a registered investment adviser and one or more of its
clients is the legal owner of the Company's outstanding Common Stock
registered in the name of RMC. The largest among these holdings is that of
Lindner Fund, Inc. RMC holds sole voting control and dispositive power over
the shares held by Lindner Fund, Inc. (315,300 shares or 5.73%) and RMC
shares voting control and dispositive power over the remaining shares
(6,500 shares or 0.12%) registered in its name.

(e) Capital Research and Management Company ("CRMC"), a registered investment
adviser and an operating subsidiary of The Capital Group Companies Inc.,
exercises investment discretion with respect to 371,000 shares (6.74%) of
the outstanding Common Stock of the Company, which are owned by various
institutional investors. CRMC has no power to direct the voting of the
shares but holds sole dispositive power over all shares registered in its
name.

* The shared voting and investment power regarding shares of the Company's
Common Stock attributable to Antonio Luis Ferre (described in footnote (d) on
page 7), Rosario J. Ferre (described in footnote (c) on page 6), Luis A. Ferre
(described in footnote (a) on page 8), and Herman Ferre, Jr. (described in
footnote (b) on page 8) by reason of their holdings of Sanber Investments S.A.
is based upon a contract arrangement dated April 21, 1989 and subsequent court
rulings of the Puerto Rico Superior Court granting voting and investment
powers to the respective Boards of Directors of South Management Corporation
and Brim Incorporado. Each of said persons disclaims that he or she is acting
as a group with regard to such shared voting and investment power. Sanber
Investments S.A., a Panama corporation, has a 100% ownership in Papelera
Nacional, Inc., a Puerto Rico corporation, which in turn has a 100% ownership
interest in both South Management Corporation, a Puerto Rico corporation which
holds of record 537,174 shares (9.76%) of the Company's outstanding Common
Stock, and in Brim Incorporado, a Puerto Rico corporation which holds of
record 537,174 shares (9.76%) of the Company's outstanding Common Stock.

9
<PAGE> 12

EXECUTIVE COMPENSATION

Set forth below is the compensation paid by the Company (none is paid by
any subsidiary) during each of the last three fiscal years ended December 31,
1995 to its President and Chief Executive Officer, the Company's four other most
highly paid executive officers whose aggregate remuneration exceeded $100,000
and to the Vice Chairman of the Board of Directors who did not serve as an
executive officer of the Company during the year ended December 31, 1995.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
ANNUAL COMPENSATION
-------------------- OTHER ANNUAL
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION(1)
- ------------------------------------------------ ---- -------- ------- ---------------
<S> <C> <C> <C> <C>
Miguel A. Nazario 1995 $256,000 $86,000 $12,431
President, Director 1994 96,615 16,664 617
and Chief Executive Officer(2)
Hector del Valle 1995 257,297 56,880 10,169
Vice Chairman 1994 199,080 52,140 9,935
Director 1993 227,895 47,400 10,056
Jose J. Suarez 1995 274,872 52,965 8,687
Executive V.P. 1994 192,000 49,500 8,446
and Director 1993 186,385 45,000 8,190
Jose O. Torres 1995 122,650 34,688 11,048
Vice President of Finance, 1994 111,950 16,522 12,856
Secretary and Treasurer 1993 103,683 16,522 12,227
Rene di Cristina 1995 108,571 30,375 8,998
Vice President -- Sales 1994 101,472 20,375 13,408
1993 95,786 19,125 14,348
Jose Rosich 1995 114,758 22,250 17,782
Director Industrial Relations 1994 107,366 21,063 9,916
and Personnel Administration 1993 97,102 19,875 11,110
</TABLE>

- ---------------

(1) The Company furnished automobiles to its executive officers, including the
six individuals named above. Other Annual Compensation reflects cost to the
Company of furnishing such automobiles to the listed officers and paying
related expenses.
(2) Mr. Nazario joined the Company in 1994 and was named President and Chief
Executive Officer of the Company as of January 1995.

Named officers received no compensation other than that presented in the
Summary Compensation Table included herein. The column of the table marked as
"salary" includes cash payments for vacation time not used by the executive.

10
<PAGE> 13

PENSION PLAN TABLE

The following table illustrates estimated annual benefits payable under the
Company's pension plan upon normal retirement to persons with the specified
combination of remuneration and years of credited service. Amounts are based on
straight life annuities including estimated social security benefits deducted in
calculating benefits paid under the plan.

YEARS OF CREDITED SERVICE(a)

<TABLE>
<CAPTION>
HIGHEST FIVE
YEAR AVERAGE
COMPENSATION(b) 10 15 20 25 30 35 40
- --------------- ------- ------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 65,000 $ 8,713 $13,070 $ 17,426 $ 22,108 $ 26,790 $ 31,471 $ 36,153
90,000 12,463 18,695 24,926 31,608 38,290 44,971 51,653
115,000 16,213 24,320 32,426 41,108 49,790 58,471 67,153
140,000 19,963 29,945 39,926 50,608 61,290 71,971 82,653
165,000 23,713 35,570 47,426 60,108 72,790 85,471 98,153
190,000 27,463 41,195 54,926 69,608 84,290 98,971 113,653
215,000 31,213 46,820 62,426 79,108 95,790 112,471 129,153
240,000 34,963 52,445 69,926 88,608 107,290 125,971 144,653
265,000 38,713 58,070 77,426 98,108 118,790 139,471 160,153
290,000 42,463 63,695 84,926 107,608 130,290 152,971 175,653
315,000 46,213 69,320 92,426 117,108 141,790 166,471 191,153
340,000 49,963 74,945 99,926 126,608 153,290 179,971 206,653
365,000 53,713 80,570 107,426 136,108 164,790 193,471 222,153
390,000 57,463 86,195 114,926 145,608 176,290 206,971 237,653
</TABLE>

- ---------------

(a) As of December 31, 1995, Miguel A. Nazario had 1 year of credited
service and $264,000 annual remuneration covered by the plan and was entitled to
a yearly pension benefit of $65,635 at normal retirement age; Hector Del Valle,
38 years of credited service and $227,520 annual remuneration (entitled to a
yearly pension benefit of $153,193 at normal retirement age); Jose J. Suarez, 36
year of credit service and $176,648 annual remuneration (entitled to a yearly
pension benefit of $94,495 at retirement age of 60); Jose O. Torres, 18 years of
credited service and $118,500 annual remuneration (entitled to a yearly pension
benefit of $55,140 at normal retirement age); Rene Di Cristina, 12 years of
credited service and $103,800 annual remuneration (entitled to a yearly pension
benefit of $43,390 at normal retirement age). All estimated pension benefit
information assumes average salary increased of 5% up until normal retirement at
age 65, except for Mr. Jose J. Suarez, who retired at age 60.
(b) A participant's pension is based upon such participant's "pensionable
earnings." Pensionable earnings are computed by annualizing the average monthly
eligible compensation received by the participant from the Company during the
60-month period in which the participant received his highest eligible
compensation. Eligible compensation is equal to "Salary" as reported in the
"Summary Compensation Table" not including bonuses (reported separately in such
table as "Bonus") or overtime payments, if any.

The Company's pension plan covers all salaried employees of the Company who
are not subject to the terms of a union contract and who complete at least 1,000
hours of service with the Company during the 12-month period beginning with the
date of employment or during any subsequent calendar year.

11
<PAGE> 14

Effective January 1, 1994, the Company amended the pension plan to modify
the benefit formula for determining an active participant's basic benefit. The
new formula produces a benefit at normal retirement age equal to 1.1% of the
participant's average monthly compensation up to "Covered Compensation" and 1.5%
of average monthly earnings in excess of "Covered Compensation" multiplied by
the first 20 years of "Credited Service," plus 1.2% of average monthly
compensation up to Covered Compensation and 1.6% of average monthly earnings in
excess of "Covered Compensation," multiplied by "Credited Service" in excess of
20 years. "Covered Compensation" is as defined in Section 401 (1) (5) (E) of the
United States Internal Revenue Code of 1986, as amended. For unmarried retired
participants the normal retirement benefit is paid in the form of a monthly
straight life annuity commencing at retirement. For married retired participants
the normal retirement benefit generally is an actuarially adjusted monthly joint
and surviving spouse annuity commencing at retirement and continuing for the
participant's life with 50% of such benefit continuing for the life of the
participant's surviving spouse, if any. "Average monthly compensation" under the
plan is the highest average monthly base salary (including commissions, but
excluding bonuses, overtime and other payments that are not predetermined)
during any five consecutive years in the ten-year period immediately preceding
the participant's actual retirement date. The minimum monthly retirement benefit
for participants who were participants in the plan on December 31, 1975 is not
less than the sum of (a) 1.2% of average monthly compensation for each of the
first 10 years of credited service plus (b) 1.5% of such compensation for each
year of credited service prior to age 65 in excess of 10, with the maximum
benefit equal to 72% of average monthly compensation after 40 years of credited
service. In computing the minimum retirement benefit, compensation is assumed to
remain unchanged since December 31, 1975. Effective August 1, 1986, any
participant retiring under the plan shall receive monthly benefits of not less
than $5.00 for each year of credited service. In addition to annual retirement
benefits, the plan provides benefits for disability, death and other
terminations of employment after 10 years of credited service. Early retirement
is provided, with unreduced benefits, for participants who are at least 55 years
of age and whose age plus years of service equal at least 85, and with reduced
benefits for participants who are at least 60 years of age with at least 10
years of service.

EXECUTIVE SEPARATION POLICY

The Company has entered into separate agreements with 27 members of
management including Messrs. Antonio Luis Ferre, Carlos J. Suarez, Hector del
Valle, Jose J. Suarez, Miguel A. Nazario, Antonio Luis Ferre Rangel, Jose O.
Torres, Jose Rosich and Rene Di Cristina. Nineteen contracts were ratified by
the Company's Board of Directors at its meeting of August 24, 1988 and eight of
these contracts were ratified by the Board of Directors at its meeting of
October 26, 1994. All contracts, among other things, grant an amount equal to
two and a half times compensation based on average salary plus bonus during the
three years prior to the date of a takeover or change in control of the
ownership of the Company. Benefits payable under the contracts are triggered if,
as a result of a change in control, these executives are (1) laid off or forced
to resign or (2) unable to function in the position held prior to the change in
control. A change in control is generally defined as a third party acquisition
of the Company's shares representing 20% or more of the total number which may
be cast for the election of directors.

COMPENSATION COMMITTEE REPORT

The purpose of the following Compensation Committee Report is to inform
shareholders of the Compensation Committee's compensation policies for executive
officers and the rationale for compensation paid to the Chief Executive Officer
("CEO"). This report is submitted by the Compensation Committee for

12
<PAGE> 15

1995. During 1995, the Compensation Committee consisted of three outside
directors of the Company. The Compensation Committee's overall goal is to
develop executive compensation policies that are consistent with, and linked to,
strategic business objectives and Company values. The Compensation Committee
approves the design of, assesses the effectiveness of, and administers executive
compensation programs in support of, compensation policies. The Compensation
Committee presents its decisions to the Board of Directors for approval.

Compensation Philosophy

The compensation program followed by the Company is based on the
achievement of business objectives. The Company's primary business objective is
to maximize shareholder value. To achieve this objective, the compensation
program is designed to relate pay to performance. Expected corporate and
individual performance goals are established by the Board of Directors at the
beginning of each fiscal year. The program also strives to attract, retain, and
reward executives who contribute to the overall success of the Company. Each
program element, therefore, is intended to target compensation levels that are
at the median of a comparative market. Offering market-comparable pay
opportunities allows the Company to maintain a stable, successful management
team.

Competitive Pay

Competitive market data is provided by an independent compensation
consultant, Hewitt Associates Caribe Inc. The data provided compares Company
compensation practices to a group of comparable companies. The Company's market
for compensation comparison purposes is comprised of a group of companies who
tend to have similar philosophies, sales volumes, and operations in Puerto Rico
or multinationally. The Compensation Committee reviews and approves the
selection of companies used for compensation comparison purposes. The companies
chosen for comparison are not in all cases the same companies which comprise the
Peer Group in the Performance Graph included on page 15. The Compensation
Committee believes that the Company's most direct competitors for executive
talent are not the same companies that would be included in a peer group
established for comparing shareholder returns.

With respect to the base salary granted to Mr. Miguel A. Nazario (President
and CEO) in 1995, the Compensation Committee took into account a comparison of
base salaries of chief executive officers of local peer companies, the Company's
success in meeting its return on equity goals in 1995, the performance of the
Company's Common Stock and the assessment by the Compensation Committee of Mr.
Nazario's individual performance. Mr. Nazario was granted a base salary of
$264,000 for 1995, an increase of 10% over his $240,000 base salary for 1994.

The key elements of the Company's executive compensation are base salary
and annual incentives. In determining compensation, all elements of an
executive's total compensation package, including pension plans, insurance, and
other benefits are considered.

COMPENSATION VEHICLES

Salary

The Compensation Committee regularly reviews each executive's base salary.
Base salaries for executives are initially determined by evaluating executives'
levels of responsibility, prior experience and breadth of knowledge, as well as
external pay practices. Increases to base salaries are driven primarily by
corporate and individual performances.

13
<PAGE> 16

Base salaries are targeted at the median of the comparative market. The
comparative market is determined by an objective evaluation of compensation
provided in similar positions in a selected group of peer companies competing in
the local job market. This comparison, which includes local companies in the
same and other industries, is performed on a regular basis by outside personnel
consultants hired for this purpose by the Company. Salaries paid can be adjusted
above or below the median based on individual and corporate performances plus
other factors such as experience in the position. Corporate and individual
performance factors are equally weighted in determining base salaries. Corporate
performance measures include return on shareholder's equity, Company performance
against budget, and performance comparison with peer group cement companies. In
1995, the Company's target for return on shareholder's equity was met, the
Company's net income before extraordinary items exceeded budgeted amounts by
15%, and the Company's performance goals in comparison to peer group cement
companies were met.

Annual Cash Bonus

All employees are eligible for an annual cash bonus. For executives, this
bonus is based on the achievement of pre-established annual corporate and
individual performance goals. This bonus opportunity promotes the Company's
pay-for-performance philosophy. Bonus opportunities are based on a percentage of
base salary. Target bonus opportunities are set at the median of the comparative
market according to position.

Corporate goals are based on total return on shareholder's equity, Company
performance against budget and performance comparison with peer group cement
companies for the year. Individual performance is also taken into account.
Corporate and individual performance factors are equally weighted in determining
bonuses. Local laws provide for a minimum bonus to be paid to all employees;
this bonus is enhanced when predetermined thresholds for corporate performance
are met.

The total appropriation for the bonus is approved by the Board of Directors
each year, based on the level of achievement of these goals. In 1995, corporate
goals were achieved or exceeded, and all of the named executive officers
received bonuses.

On an occasional basis, the Compensation Committee recommends to the Board
special bonuses for extraordinary achievement of specific objectives. These
special bonuses are of a non-recurrent nature. Special bonuses were awarded in
the last fiscal year to five officers of the Company.

In 1995, Mr. Nazario's annual bonus payment represented the level of
achievement of pre-specified financial and operational goals. Achievement was
measured in terms of total return on stockholder's equity, performance against
budget and other specific performance goals. Major predetermined goals exceeded
among others were: 1995 net income before extraordinary items exceeded budgeted
amounts by 15%; successful vertical integration by acquisition of two
ready-mixed concrete companies and completion of the mill conversion project.
Objectives regarding return to shareholders were met during 1995. Based on these
factors and the Company's performance in its product markets, Mr. Nazario's
annual bonus payment was increased to $86,000 as compared to 1994.

Compensation Committee:
Jorge L. Fuentes, President
Alberto M. Paracchini
Hector Puig Ramirez

14
<PAGE> 17

COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
AMONG PUERTO RICAN CEMENT COMPANY, INC.,
STANDARD AND POORS INDUSTRIALS INDEX AND PEER GROUP

Set forth below is a performance graph which was prepared with the aid of
independent consultant Standard & Poor's Compustat Services Inc. It assumes a
$100 investment in January 1, 1990 and includes total return to shareholders
assuming reinvestment of dividends on a monthly basis over a five-year period
using 1990 as base year. Returns were based on a published industrial index and
on the weighting of results at the beginning of each year between industry peer
group members excluding the Company. Industry Peer Group members consist of
seven major companies in the cement or related industries publicly listed on a
national stock exchange in the U.S. with the same or similar business products
as the Company. The companies included are: Calmat Co., Florida Rock Industries,
Giant Group LTD, Lafarge Corp., Southdown Inc., Texas Industries Inc., and
Vulcan Materials Co. Holnam Inc., included in the 1993 comparison, was
privatized in 1994 and dropped from public listings and from the peer group
comparison. Results were weighted according to market capitalization. The stock
price performance on the graph below is not necessarily indicative of future
price performance.

TOTAL SHAREHOLDER RETURNS
------------------------
(Dividends Reinvested)

<TABLE>
<CAPTION>
INDEXED RETURNS
Years Ending

Base
Period
Company Name/Index Dec90 Dec91 Dec92 Dec93 Dec94 Dec95
- -----------------------------------------------------------------------------------------
<S> <C> <C> <S> <C> <C> <C>
S&P INDUSTRIAL INDEX 100 130.78 138.21 150.89 156.45 210.56
PUERTO RICAN CEMENT CO INC 100 145.57 189.37 190.32 223.00 288.55
PEER GROUP 100 110.50 133.02 163.83 150.61 178.87
</TABLE>

15
<PAGE> 18

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

During 1995, the Compensation Committee consisted of the following
non-employee directors of the Company: Jorge L. Fuentes, Alberto M. Paracchini
and Hector Puig Ramirez. Mr. Paracchini is Vice Chairman of the Board of the
Company.

During 1987, the Company entered into a loan agreement with Banco Popular
de Puerto Rico, a commercial bank, of which Messrs. Antonio Luis Ferre, Alberto
M. Paracchini, Esteban D. Bird and Juan A. Albors are directors, pursuant to
which such bank agreed to provide the Company interim (convertible to long-term)
financing until September 30, 1990 up to an aggregate principal amount of $10
million. The proceeds of the loan were used to convert certain of the Company's
equipment to a process of cement production that is more cost-effective and
efficient. This loan was converted into a term loan of $10 million and
subsequently refinanced together with the proceeds of a $7 million working
capital term loan granted on September 1994. The balance of $10,053,571, as of
December 31, 1995, will be repaid over a period of seven years in annual
installments, plus accrued interest at an annual rate of 6.55%.

As of December 31, 1995, the Company had available from Banco Popular de
Puerto Rico lines of credit of $4,000,000 for unsecured short term borrowings
and/or discounting customers' trade paper. A wholly-owned subsidiary of the
Company, Florida Lime Corporation, had available a line of credit of $600,000
from such bank as of December 31, 1995 for unsecured short-term borrowings. At
such date, the Company and such subsidiary had no outstanding borrowings under
these lines of credit. During 1995 the bank granted the Company a $10,053,517
term loan to refinance loans available for a dry process conversion project
which is payable over a seven-year period at a fixed interest rate of 6.55% per
annum and in 1993 approved a long term facility of $8,000,000 financing a mill
conversion project at a fixed rate of 6.25% per annum, which now carried a
balance of $6,000,000 as of December 31, 1995. In 1995 the Company obtained from
the bank an $8,000,000 term loan for working capital purposes payable over a
seven-year period at a fixed interest rate of 6.55% per annum and in 1993 the
bank granted the Company a $6,000,000 term loan to refinance loans available for
a dry process conversion project which are now payable over a five-year period
at a fixed interest rate of 6.25% per annum and carried a balance of $4,500,000
as of December 31, 1995.

During 1995, the Company sold its products, in the normal course of
business, for the aggregate amount of $131,801, to Ferreterias Puig, Inc., a
Puerto Rico corporation of which Mr. Hector Puig Ramirez is President. During
1995, the Company sold its products, in the normal course of business, for the
aggregate amount of $530,729 to Fuentes Concrete Pile, Inc., a Puerto Rico
corporation of which Mr. Jorge L. Fuentes is Chairman of the Board of Directors,
Chief Executive Officer and a Director.

CERTAIN TRANSACTIONS WITH MANAGEMENT

The following briefly summarizes certain transactions with the Company and
certain transactions relating to the officers or directors of the Company.
Transactions relating to Compensation Committee members are included under
"COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION."

Mr. Carlos J. Suarez a Director of the Company as of December 31, 1995,
received during 1995 the aggregate amount of $180,000 in consulting fees and a
Company automobile for work performed for the Company under a consulting
contract. The consulting fees originated from services performed as a consultant
in the management of the daily operations of the Company and were paid in
addition to directors' fees received by Mr. Suarez as a retainer and for his
attendance at Board meetings. The terms of such contract and

16
<PAGE> 19

consulting fees paid pursuant thereto are competitive with the terms of and fees
paid pursuant to contracts for similar services entered into by the Company with
outside parties. Mr. Suarez occupied the position of Chairman of the Board of
the Company until December 1994.

As of December 31, 1995, the Company had available from Scotia Bank de
Puerto Rico, a commercial bank of which Mr. Jose J. Suarez is a Director, a line
of credit of $4,000,000 for unsecured short-term borrowings which was unused as
of December 31, 1995. In 1993, the bank approved a construction long term
facility of $8,000,000, which was increased to $12,000,000 with an actual rate
of 7.30% per annum as of December 31, 1995. This loan is payable over a
five-year period commencing in 1996. During 1994, the bank approved a $3,000,000
term loan for working capital purposes payable in a lump sum in 1999 at a fixed
interest rate of 7.35% per annum. In 1995, the Company obtained from the Bank of
Nova Scotia, parent company of ScotiaBank de Puerto Rico, an $8,000,000 term
loan for working capital purposes payable over a seven-year period at a fixed
interest rate of 6.32% per annum.

During 1995, Diesel del Sur, Inc., a Puerto Rico corporation and
dealership, sold motor parts and provided services in the normal course of
business to the Company in the aggregate amount of $978,440. The children of Mr.
Carlos J. Suarez are majority stockholders of, and one son Carlos J. Suarez,
Jr., is President of, Diesel del Sur, Inc.

Mr. Antonio Luis Ferre, a Director and Chairman of the Board of the Company
as of December 31, 1995, received during 1995 the aggregate amount of $200,000
in consulting fees and a Company automobile for work performed for the Company
under a consulting contract. The consulting fees originated from services
performed as a consultant in the management of the daily operations of the
Company and were paid in addition to directors' fees received by Mr. Ferre as a
retainer and for his attendance at Board meetings. The terms of such contract
and consulting fees paid pursuant thereto are competitive with the terms of and
fees paid pursuant to contracts for similar services entered into by the Company
with outside parties. Mr. Ferre was elected Chairman of the Board of the Company
effective January 1, 1995.

DATE OF RECEIPT OF STOCKHOLDERS' PROPOSALS

Stockholders who intend to present proposals at the 1997 annual meeting of
stockholders must submit their proposals to the Company on or before November
30, 1996.

DIRECTORS' FEES

Standard remuneration for directors not employed by the Company is a $2,500
quarterly retainer fee and $1,000 for each Board or committee meeting attended.
In addition, the Company pays yearly premiums of approximately $612 on behalf of
each outside director in connection with group life and accident insurance
coverage. The Company paid approximately $4,367 during the fiscal year as
interest for accumulated deferred compensation for one director and compensates
two directors an additional $50 per meeting for costs associated with traveling
from outside the San Juan metropolitan area.

OTHER MATTERS

The Board of Directors of the Company has, among others, the following
committees: an Audit Committee composed during 1995 of outside directors Messrs.
Esteban D. Bird, Federico, F. Sanchez and Emilio J. Venegas; a Compensation
Committee composed during 1995 of outside directors Messrs. Hector

17
<PAGE> 20

Puig Ramirez, Alberto M. Paracchini and Jorge L. Fuentes and a Nominating
Committee composed during 1995 of directors Messrs. Carlos J. Suarez, Jorge L.
Fuentes, Antonio Luis Ferre and Antonio Luis Ferre Rangel.

The Audit Committee makes recommendations for the appointment of
independent auditors and, in conjunction with internal and external auditors,
makes recommendations to the Board of Directors concerning the Company's
internal accounting controls and operating procedures, including the review and
approval of internal audit programs.

The Compensation Committee evaluates and makes recommendations to the Board
of Directors regarding the remuneration of directors, officers and salaried
employees. The policies and mission of the Compensation Committee are set forth
in the "Compensation Committee Report" found on page 12.

The Nominating Committee evaluates and makes recommendations to the Board of
Directors on nominees for directors as vacancies arise.

During 1995, the Board of Directors met 13 times, the Nominating Committee
met 1 time, the Audit Committee met 3 times and the Compensation Committee met 1
time. Each director, except for Mr. Hector Puig, attended at least 75% of the
aggregate meetings of the Board and each committee thereof of which he was a
member.

To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, during the two fiscal years ended December 31, 1995, all
Section 16 (a) filing requirements applicable to the Company were complied with.

The Board of Directors again selected Price Waterhouse, certified public
accountants, to audit the accounts of the Company for the year 1995. A
representative of Price Waterhouse is expected to be present at the meeting of
stockholders and available to answer stockholders' questions and, if he so
desires, to make a statement. The audit services performed for the Company
included the examination of the annual financial statements and financial
information contained in the Company's report on Form 10-K filed with the
Securities and Exchange Commission, in addition to consultation from time to
time with officers of the Company in connection with various accounting methods
and procedures.

The Board of Directors does not intend to bring any other business before
the meeting, nor is it aware that anyone else intends to do so. However, should
any other business come before the meeting, it is the intention of the persons
named in the enclosed proxy to vote as proxies in accordance with their best
judgment.

By Order of the Board of Directors

Jose O. Torres
Secretary

PUERTO RICAN CEMENT COMPANY INC.

18
<PAGE> 21
APPENDIX A

PUERTO RICAN CEMENT COMPANY, INC.

PROXY FOR ANNUAL MEETING OF STOCKHOLDERS, MAY 1, 1996

The undersigned stockholder of PUERTO RICAN CEMENT COMPANY, INC. (the "Company")
hereby appoints RENE DI CRISTINA, ANGEL AMARAL, and JOSE A. COSTA, and each of
them, proxies of the undersigned, each with power of substitution, to represent
and to vote as designated below all shares of common stock of the Company held
of record by the undersigned on March 15, 1996 at the annual meeting of
stockholders to be held at the offices of the Company, Amelia Industrial Park,
Guaynabo, Puerto Rico, on May 1, 1996 at 10:00 o'clock A.M., Atlantic Standard
Time, and at any adjournment thereof, with all powers the undersigned would
possess if personally present.

The Board of Directors recommends a vote FOR proposal 1.

1. / / FOR the election of all nominees for Class III Director listed below
(except as marked to the contrary below).

/ / WITHHOLD all votes for the election of all nominees for Class III
Directors listed below.

Antonio Luis Ferre, Alberto M. Paracchini, Jose J. Suarez, Jose Angel Fernandez
Paoli, Emilio J. Venegas and Antonio Luis Ferre Rangel.

(INSTRUCTION: To withhold authority to vote for any individual nominee, write
that nominee's name on the space provided below).

- --------------------------------------------------------------------------------

2. In their discretion, the proxies are authorized to vote upon such other
business as may lawfully come before the meeting or any adjournment.

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION TO VOTE IS MADE BY THE UNDERSIGNED
STOCKHOLDER, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE COMPANY'S NOMINEES
FOR DIRECTORS.

PLEASE SIGN AND DATE WHERE INDICATED BELOW AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE.
NO POSTAGE REQUIRED.

The undersigned hereby acknowledges receipt of the Annual Report for 1995, the
Notice of Annual Meeting of Stockholders and the Proxy Statement relating to
said Annual Meeting, and hereby revokes any proxy or proxies heretofore given in
respect of the same shares of stock.

Signature should agree with
name on stock certificate. When
shares are held by joint
tenants, both should sign. When
signing as an attorney,
executor, administrator,
trustee or guardian, please
give full title as such, If a
corporation, please sign in
full corporate name by
President or other authorized
officer. If a partnership,
please sign in partnership name
by authorized person.

-------------------------------

Signature of Stockholder

-------------------------------

Signature if held jointly

Dated ,1996
--------------------

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY.