EARNINGS of Cemex Holdings Philippines, Inc. (CHP) dropped by 71% in the first quarter of 2018, as higher volumes for the period failed to offset the increase in fuel and power costs.
In a statement issued Friday, the cement manufacturer reported a net income of P100 million, significantly lower than the P350 million it generated in the same period a year ago. Earnings before interest, taxation, depreciation, and amortization (EBITDA) also went down by 17% to P886 million for the period.
CHP noted however that the volume of cement sales picked up for the quarter, posting a 16% year-on-year increase. Net sales accordingly grew by 9.3% to P5.9 billion.
“We are very focused on supplying the needs of the market, given the growing Philippine economy and what we believe will be a robust construction sector for many years to come. Our results showed our ability as a company to deliver on the country’s needs,” CHP President and Chief Executive Officer Ignacio Alejandro M. Elizondo was quoted as saying in a statement.
The company is currently working on removing bottlenecks in order to increase its annual capacity by 500,000 tons. It is also in the process of a $225-million expansion of its Solid Cement Plant in Antipolo, Rizal. CHP looks to start operations of a new line in the facility by the first quarter of 2020.
“Strong local demand presents both opportunities and challenges for the industry. The execution of our expansion project, and the attainment of greater operational efficiencies will be important for us to continue growing,” Mr. Elizondo said.
CHP has been experiencing a drop in earnings since 2017, dragged down by lower cement prices and higher fuel and distribution costs.
Despite this, the company said it remains positive about the Philippine market, allocating P3.7 billion for capital expenditures in 2018. CHP is banking on the country’s sustained economic expansion, driven by the government’s aggressive infrastructure program until 2022.
Incorporated in 2015, CHP produces and markets cement and cement products under the brands APO, Island, and Rizal.
Shares in CHP went up by 16 centavos or 4.85% to close at P3.46 each at the Philippine Stock Exchange on Friday. — Arra B. Francia