Cement producer and distributor Holcim Philippines Inc. posted double-digit growth in net income in the first six months of the year, driven by increased public-private partnership (PPP) construction projects and government spending.
“On top of the sustained government and private sector spending, we now see some major Private-Public Partnership projects being implemented in the metropolis, hence, our strong sales,” said Holcim Chief Executive Officer Eduardo Sahagun.
“We were able to meet this huge demand with our ability and commitment to keep the market supplied during this period of robust growth,” he added.
For the first half, the company booked P3.32 billion in net income, up 10.3 percent from P3.053 billion recorded in the same period last year. Revenue rose 8.7 percent to P16.86 billion from P15.279 billion.
“We have broken our record this year,” the CEO of the cement maker said, adding that sales increased to 90 million metric tons so far this year from the year-earlier 84 million MT.
Quarterly sales to June reached 47 million MT, averaging 15 million MT per month.
“Volume growth drivers include rehabilitation efforts in the areas damaged by Typhoon Yolanda in Visayas and Mindanao, as well as the few PPP projects that have started,” Sahagun added.
The Holcim CEO noted that 40 percent of the sales came from public infrastructure demand, while the private sector accounted for 60 percent.
For the second quarter alone, net income was up by a slight 1.8 percent at P1.65 billion from P1.62 billion, while revenue improved 8.6 percent to P8.8 billion from P8.1 billion last year.
Sahagun warned that volume and sales value may ease in the second half of the year due to the “rainy season, and usually we do maintenance by the latter part of the year.”
The nationwide cement industry grew 6 percent in the first half on the back of strong momentum in public and private construction activity.
Merger talks between Lafarge and Holcim are still ongoing, Sahagun said.
Meanwhile, the company is also studying the viability of constructing a proposed $550-million Bulacan factory that is intended to boost its production capacity by an additional 2.5 million MT yearly.
Holcim Philippines is a local arm of the Holcim Group based in Switzerland and Zurich, producing and supplying cement and aggregates such as crushed stone, gravel and sand. The cement maker has four factories in the Philippines—one each in La Union, Bulacan, Misamis Oriental and Davao.