Holcim income results soft despite record cement output


Updated Tue, 11 Aug 2015 09:44:25 GMT

Holcim Philippines, Inc. (HPI) President and Chief Executive Officer Eduardo A. Sahagun reported that second-quarter net profit slid 7.65% to P1.53 billion from P1.65 billion a year ago, dragged by one-time expenses and higher costs due to the importation of clinker.

HPI had to import more expensive clinker to serve robust cement demand, which resulted in record production volumes during the three-month period. This pushed net sales by 6.86% year on year to P9.41 billion from P8.81 billion in 2014.

Net income in the first semester fell 8.89% to P3.03 billion from P3.32 billion, with the early implementation of plant maintenance activities in the first quarter also dampening the results, Mr. Sahagun said.

First-half net sales rose by an annual 6.73% to P17.995 billion from P16.86 billion.

Asked about his profit outlook for the rest of the year, Mr. Sahagun said: “I’m sure it will be much better than the prior year’s second half.”

To support demand, HPI reiterated that it would spend $40 million over a three-year period to increase the capacity of its plants in Calaca, Batangas and Mabini, Bulacan, as well as the Star Terminal at the Harbour Centre in Manila.

Star Terminal was part of the P3 billion worth of assets it acquired from Lafarge Republic, Inc. as part of the global merger of their parent firms. HPI borrowed money to fund the acquisition, Mr. Sahagun said.

“With this we expect to be more flexible, agile in being able to meet customers’ increasing demand,” he said.