HOLCIM Philippines, Inc. (HPI) booked flat profit growth in the first quarter of 2019 due to lower sales and higher interest expenses.
In a regulatory filing, the listed cement manufacturer said net income attributable to the parent stood at P703.63 million from January to March, slightly higher than the P699.65 million it posted in the same period a year ago.
This followed a 5.82% decline in net sales to P8.10 billion. The company was affected by the shutdown of its Mabini, Batangas plant last March on the order of the regional Environmental Management Bureau. This reduced its volumes by 102,000 tons for the month.
HPI also noted that it incurred higher interest expenses for the quarter due to its short-term loans, further weighing down its bottom line.
At the same time, the company was able to raise its operating EBITDA, or earnings before interest, taxation, depreciation, and amortization, by 30.7% to P1.7 billion. HPI said this was due to the lower cost of goods sold complemented by a decrease in operating expenses.
“Our focus on raising profitability through tighter cost management, improved operational efficiency and commercial innovation continues to pay off as seen in our business results, and we are determined to build on these further,” HPI President and Chief Executive Officer John Stull said in a statement.
“We will continue to execute with precision to deliver on shareholders’ expectations and become a stronger partner in the country’s progress.”
HPI is currently being acquired by diversified conglomerate San Miguel Corp. for $2.15 billion, as the cement manufacturer’s parent Lafarge Holcim Group is unwinding its investments in Southeast Asia to focus on other markets. The transaction is currently pending regulatory approval. — Arra B. Francia