Holcim Philippines delivers resilient results in 2020

1 March 2021
 
  • Health and safety initiatives and agile cost management measures were key to 2020 performance
  • Cost and efficiency gains to be sustained and benefit the Company beyond 2020
  • Sustainable operations, new building products, and digital solutions will be focus areas in driving profitable growth

John Stull, President and CEO of Holcim Philippines, Inc. said: “Key to our resilient 2020 performance was our focus on Health, Cash and Cost. We improved efficiency and sustainability of operations. We also introduced new building solutions and enhanced digital tools to better serve the customers. With our committed employees and loyal business partners, these improvements make us ready to help drive a faster recovery and deliver great value to all our stakeholders.”

FINANCIAL PERFORMANCE

Net Sales declined by 22% to Php26.0 billion as volume and prices dropped due to the impact of the pandemic. Lockdowns from March to May and severe weather conditions in the fourth quarter further affected the business. These hampered delivery of raw materials and services to production sites and dispatch of products to customers.

Holcim Philippines posted Operating Earnings before Income Tax (EBIT) of Php2.8 billion which was 44% lower than the 2019 Operating EBIT of Php4.9 billion.

The Company responded to the pandemic by rationalizing costs and managing spend. Programs addressing Health, Cash and Cost yielded a cost improvement of 7% over 2019. Distribution expenses decreased by 18% due to the operational and cost efficiencies, including the shift of delivery mode to higher proportion of pick-up sales. The Company also benefitted from the global decline in fuel and energy prices.

Holcim Philippines is expected to sustain its gains from cost management and efficiency improvements beyond 2020.

 

KEY DEVELOPMENTS

Holcim Philippines kept operations free from COVID-19 in 2020 due to immediate actions in line with government guidelines and LafargeHolcim Group’s best practices. These enabled the Company to prevent any health-related disruptions and to provide reliable supply to customers after the lockdowns were eased nationwide.

On the commercial side, the Company partnered with mixed martial arts organization ONE Championship and its heavyweight world champion, Brandon "The Truth" Vera, for a campaign on our strong legacy of excellence in helping build important structures for the country’s development. Product innovations also continued with the launch of Holcim Multifix, a new easy-to-use and multipurpose mortar product to improve the quality of walls, floors, and tile installations in buildings.

The Company advanced in commercial digitalization with significant increases in the usage of online customer portal Easybuild for orders and payments versus 2020. Furthermore, strong customer connections were maintained through virtual platforms in a program called EKonekta.

Among the sustainability highlights were the 160,000 people assisted by the Holcim HELPS CSR campaign. More resources were given to community health and sanitation projects in response to the COVID-19 situation. The Company is also set to invest Php121.5 million until 2022 to improve usage of alternative fuels and raw materials for cement production at its Bulacan plant.

 

KEY FIGURES (IN THOUSANDS)

 

Full Year

Fourth Quarter

 

Jan.-Dec. 2020

Jan.-Dec. 2019

Oct.-Dec. 2020

Oct.-Dec. 2019

Net Sales

Php 26,015,342

Php 33,486,771

Php 7,235,405

Php 9,808,182

EBITDA

Php 4,731,443

Php 6,688,827

Php 1,530,296

Php 2,490,287

Operating EBIT

Php 2,763,520

Php 4,942,028

Php 943,353

Php 2,000,777

Net Profit

Php 2,064,084

Php 3,589,642

Php 1,036,553

Php 1,711,713

*For more information on our financial performance, you may check our page at the Philippines Stock Exchange website or the section on disclosures on our Company’s website.