New Holcim CEO to focus on operational efficiency, cost management to raise performance amid building boom

05.18.2018
 

Operational improvements, tighter cost management and new building solutions will continue to be prioritized by Holcim Philippines, Inc. to better benefit from and support strengthening construction activity in the country, its top executive said during the company’s annual shareholders’ meeting on May 18.

Newly appointed President and CEO John Stull said the company plans to seize the opportunities from the ongoing construction boom by improving its ability to supply the market more efficiently and provide value-adding offerings to its partners in the building industry.

During his address to shareholders, Stull said the company is bolstering its equipment maintenance programs while continuing to streamline logistics systems and processes for more reliable customer service. Holcim Philippines again budgeted Php2.4 billion for capital expenditures this year in line with the company’s plans to raise production capacity.

“Last year, we started projects to raise cement production capacity nationwide to 12 million metric tons by 2019. While these projects have just started, we are already considering more investments to raise clinker capacity given the positive projections for the construction industry,” he said.

“Before further raising production capacity, we have to make sure we are getting as much as we can from our plants. For this, we worked with the LafargeHolcim Group to strengthen the culture of excellence in our facilities. We also implemented logistics excellence initiatives so our business partners and customers receive products when and where they need it.”

Stull added that improved production efficiency is critical as the cost of inputs have risen given external developments. The company has also launched initiatives to trim down energy and logistics expenses, the business’s biggest cost items.

Despite higher sales volumes, Holcim Philippines’s profits for the first quarter of 2018 reached Php 700 million compared to Php 940 million from the same period last year. The decline was due to lower cement prices from increased competition and higher production expenses. Still, the company’s financial performance is steadily improving with the Q1 2018 results 278% higher than its Q4 2017 numbers and the highest since Q3 2017.