Construction solutions company Holcim Philippines Inc. experienced a substantial surge in revenue but has seen its first quarter net earnings flat, mainly because of the scheduled maintenance of various plants during the period.
In a press briefing, Eduardo Sahagun, Holcim Philippines Inc. president and chief executive officer, said that for the first three months of the year the firm realized a flat net income of P1.5 billion.
“We should have realized a net income of P1.7 billion during the first quarter this year, or higher by 13 percent from the same quarter last year were it not for our scheduled plant maintenance,” Sahagun said.
The company spent about P250 million for plant maintenance, while importing about 7 million bags of cement to meet the demand.
This month, its Misamis Oriental and Davao City plants are undergoing maintenance repair, the firm said.
Holcim shutdown its Bulacan and La Union plants for the scheduled maintenance in the first quarter.
“That was the difference between the first quarter of this year and the same quarter in 2015, since we did not have any plant maintenance activities during the previous year,” Sahagun said.
Revenue, on the other hand, soared by 17.2 percent to P10.1 billion from P8.6 billion.
Sahagun attributed the increase in sales to robust construction activities in the country.
“This was driven by sustained roll out of private projects and higher state spending for infrastructure… equivalent to 5 percent of gross domestic product GDP),” he said.
This was equivalent to almost 54 million bags of cement from 47 million bags a year earlier.
Operating earnings before tax, interest, depreciation and amortization (Ebidta) improved by 5.3 percent to P2.5 billion.
For the rest of the year, the top executive said Holcim remains optimistic of further improvement in net income despite an expected slowdown during the transition period from the incumbent to new administration.
“All PPP [public-private partnership] projects require cement and we expect to take part in those various projects in the pipeline,” Sahagun said.