Strong construction, operational efficiencies boost Holcim Philippines performance in Q2


Key Messages


• Holcim Philippines’ profits for the second quarter rose 34% to Php1.62 billion on stronger sales and efficient operations.

• Holcim Philippines is set to conduct its regular maintenance activities on its facilities during the onset of the rainy season, when demand traditionally slows down.

Leading cement manufacturer Holcim Philippines, Inc. enjoyed an excellent second quarter after construction picked up during the summer months, supported by steady plant operations and effective cost controls.

Revenues grew by 13% to Php8.11 billion and net income jumped 34% to Php1.62 billion, helped by increase in sales volumes, improving operational efficiencies and sustained cost management. For the first half, Holcim Philippines revenues improved by 10.5% to Php15.28 billion and net income surged by 50% to Php3 billion.

CEO Ed Sahagun acknowledged that the company benefited from the robust construction nationwide due to favorable weather conditions, early release of government funds for infrastructure and elections spending.

“Our industry is a key sector that is benefiting early from the Philippines’ economic revival. We see a continuing trend in construction activities -- government is keen on sustaining infrastructure investments, and private construction is being driven by real demand. In such an environment, the challenge is keeping the market supplied and we are committed to do our share,” Sahagun said.

Moreover, the Company’s own initiatives were vital in achieving its excellent performance. Operational efficiencies and cost management across functions and facilities led to further improvements in production and distribution costs.

Said Sahagun: “Our good performance affirms our ability to work well as one organizational team. It also affirms the soundness of our decisions, particularly in sustaining the level of investments to keep our plants in good condition. At a time of high demand, we kept our facilities running efficiently, while keeping costs within control.”

Sahagun remains optimistic about the company’s prospects, noting that the government ‘s proposed Php2.268-trillion national budget for 2014  includes a Php399.4 billion allocation for infrastructure development, which is 35.5% higher than this year’s allotment.

He shared that Holcim Philippines is ready to capture opportunities coming from future growth in cement demand due to the reactivation of its 1 million ton-per-year cement grinding facility in Mabini, Batangas, which is expected to start commercial operations this coming quarter. In addition, preparations for a new production line in Bulacan are on track.