HOLCIM Philippines, Inc. has secured tax incentives for its new cement line in Bulacan, it told the stock exchange on Thursday.
The listed cement manufacturer said the Board of Investments approved its application for registration as a new producer of cement with regards to its Bulacan Line 3 plant. The plant will have a capacity of 2.478 million tons per year.
Tax incentives under Executive Order 226 include income tax holidays of up to six years from commercial operations for pioneer firms and four years for non-pioneer firms.
The Bulacan facility forms part of Holcim’s $300-million investment to hike its capacity by 30% in 2020. The total capital spending also involves company’s plant expansion in Misamis Oriental, where it will install new kilns, mills, and waste heat recovery systems.
This is on top of Holcim’s earlier $54-million capital infusion to expand its cement production in La Union and Davao.
At the end of the expansion of these four facilities, Holcim is seen to have an annual capacity of 13 million metric tons.
Holcim reported a five percent drop in its net income to P2.55 billion in 2018, compared to P2.69 billion in the year before. This came on the back of a three percent increase in net sales to P35.62 billion.
The company blamed higher production and financing expenses from its expansion efforts for the slower performance, amid the challenging business environment last year.
Incorporated in 1964, Holcim is part of the LafargeHolcim Group, which is involved in building materials present in about 80 countries. Its cement products include Holcim Premium, Holcim 4X, Holcim Excel, and Holcim WallRight Cement.
Shares in Holcim rallied 1.59% or 16 centavos to close at P10.20 each at the stock exchange on Thursday. — Arra B. Francia