Holcim Philippines reports H1/Q2 2019 performance

31 July 2019
 
  • Operating EBITDA continues to improve as a result of  cost and efficiency improvements
  • Aggregates sustain healthy growth
  • Cement sales impacted by slowdown in government spending

 

John Stull, President and CEO of Holcim Philippines, Inc. said: “We continued to deliver value to our customers and shareholders by sustaining actions to manage our costs and improve operational efficiency despite a slowdown in public construction activity which affected sales volumes. We remain upbeat about our prospects this year as we expect demand to accelerate in the second half. Holcim Philippines is ready to capture the market’s growth having put in place significant initiatives to drive performance and adequately respond to the country’s growing need for high quality building materials. This includes the completion of capacity expansion projects of our plants in North Luzon and Mindanao, where economic activity is among the most robust in the country.”

 

FINANCIAL PERFORMANCE

Cement demand eased in the first half with muted government infrastructure spending following the delayed passage of the national budget.  Net sales reached Php15.4 billion and Php 7.3 billion, respectively, in the first half and second quarter. The aggregates business continued its positive contribution to the business with net sales higher by 22% year-on-year to Php 1.1 billion on improved product mix and prices.

Despite lower sales compared to 2018, Operating Ebitda for the first half rose by 9.5% to Php 3 billion while Ebitda margins grew by 5% due to successful initiatives on product mix, pricing, logistics efficiency and cost-optimization. These actions were pivotal in managing costs and raising efficiencies that improved profitability and delivered value for stakeholders.

The company generated Php1.4 billion and Php 716 million in net profits for the first half and second quarter, respectively.

 

KEY DEVELOPMENTS

Holcim Philippines completed in June the expansion project of its Davao plant to raise the facility’s cement production capacity to 2.4 million metric tons. Along with the upgrade of its La Union plant in January, the Davao project further strengthens the company’s ability to provide local reliable supply to its partners all over the country.

Sales of the company’s blended cement offerings continue their healthy growth led by ‘Solido’, a brand that was launched in March, as a better alternative to Ordinary Portland Cement for infrastructure applications due to its advantages in strength, durability and environmental impact.

 

KEY FIGURES (IN THOUSANDS)

 

First Half

Second Quarter

 

Jan-June 2019

Jan-June 2018

Apr-June 2019

Apr-June 2018

Net Sales

Php 15,382,033

Php 18,750,961

Php7,278,542

Php10,146,808

Operating EBITDA

Php 3,031,105

Php 2,768,074

Php1,343,755

Php1,514,886

Net Profit

Php 1,420,475

Php 1,563,927

Php 716,614

Php 864,037

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