• Cement industry volumes in 2012 soared 18%, its highest growth in 15 years
•The company is bullish about its prospects with construction activity seen to remain strong this year given the positive economic environment, and is looking to increase its capacity
Leading cement manufacturer Holcim Philippines, Inc. (HPHI) registered record volumes in 2012, a fitting cap to its celebration of the global Holcim brand’s centennial year.
Strong construction activity in both public and private sectors drove the growth, with the Cement Manufacturers Association (CeMap) reporting an 18% increase in market demand, the highest growth in 15 years.
HPHI grew by 21%, a sharp recovery from a 5% contraction in 2011. The Company’s sales revenues grew by over a quarter to Php 27.16 billion. Thanks to the company’s initiatives to further improve operating and process efficiencies, and manage fixed and support costs, which contributed significantly to strong bottom line, net income surged by almost 80% to Php 3.63 billion.
“We strongly benefited from the rebound in public infrastructure spending and the private sector’s continuing participation in construction across the country,” said HPHI Chief Executive Officer Eduardo Sahagun. “That we were able to fully capture the opportunities coming from such growth affirms our capability as a team, and validates the soundness of our business strategies and programs.”
The government had earlier cited the construction sector as a major contributor to the economy’s rapid growth in 2012. After a sluggish 2011 pending the government’s reform initiatives, public construction jumped 32.4%, while private construction registered an 8.6% growth.
As demand exceeded expectations, HPHI decided to import clinker to ensure steady supply.
“Providing our customers with reliable supply is a commitment we take very seriously,” said Sahagun.
Sahagun is optimistic that 2013 will continue to see robust construction activities particularly with the start of several Private-Public Partnership Projects. He added that the continued growth of the outsourcing industry and OFW remittances plus the strong macroeconomic indicators such as low and stable inflation and interest rates will fuel HPHI this year.
“This is an exciting time for our Company,” said Sahagun. “The growing economy presents us with tremendous opportunities and we intend to fully participate in this growth.”
In preparation for such growth, the Company has put in place initiatives to further expand capacity starting with the reopening of a grinding facility in Mabini, Batangas by the third quarter. By April, it is set to present a proposal for a new brownfield plant in Norzagaray, Bulacan to its Board and principals inZurich.