CEMENT manufacturer Holcim Philippines, Inc. said on Friday its net income in 2017 declined 65.2 percent due to a slowdown in the construction industry coupled with heightened competition and higher input costs.
Holcim said net income last year dropped to P2.4 billion from the P6.9 billion registered in 2016, while revenues fell 13.9 percent to P34.7 billion from P40.3 billion a year earlier.
“The construction growth slowdown, tighter competition and increased input costs affected our financial performance in 2017. But we reacted swiftly to mitigate these challenges,” Holcim President and Chief Executive Officer Sapna Sood told the stock exchange.
Although there was a steady increase in public spending during the second half of 2017, the sluggish growth in construction led to a decline in cement demand.
With the lower revenues and higher production expenses primarily caused by increased fuel prices, consolidated operating earnings before interest, tax, depreciation, and amortization fell 49.6 percent to P5.4 billion.
“We launched projects to strengthen customer focus, improve the efficiency of plant and logistics operations, manage costs, and offer more innovative building solutions. We expect these to improve our business performance and allow Holcim Philippines to have an even more positive impact on the country’s development,” Sood said, adding that Holcim will continue such initiatives to further support the government’s Build, Build, Build program.
“Our transformation allows us to enable our partners to execute these projects with high performance and efficiency, ultimately helping the country build better with certainty,” he said.
In the third quarter of 2017, Holcim embarked on a P3 billion project to raise its cement production capacity by 2 million metric tons as the company aims to take advantage of the projected rise in demand due to the Build, Build, Build program.
Holcim also engaged stakeholders in the road infrastructure sector, showcasing innovative building solutions that enable them to deliver projects faster and more efficiently, one of which is the government’s accreditation of Roller Compacted Concrete, a building technology that can speed up road infrastructure development.