Displaying items by tag: Holcim Philippines

Philippines: Holcim Philippines posted higher sales despite increased competition in 2016. Its revenue grew by 7.5% to US$801m due to both higher volumes and prices. Operating earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 14% to US$215m.

The company’s net income reached US$135m, which benefited from a one-time gain of US$52m from the revaluation of Holcim Philippines’ investment in an affiliate. Without the one-off item in 2015, profits were higher by 24% in 2016.

Holcim Philippines Chief Operating Officer Sapna Sood said, “Ensuring stable supply is critical in these times of high building activity. Last year, we demonstrated our commitment to keep the market supplied by raising our production capacity and leaning on our strong regional network. As a result, we showed our customers we are a reliable partner, which helped us compete, even with the entry of new players.”

Philippines: Holcim Philippines’ Bacnotan and Norzagaray cement plants have won awards for energy efficiency at the 2016 Don Emilio Abello Energy Efficiency Awards. The plants won Awards of Recognition for representing the Philippines in the Association of Southeast Asian Nations (ASEAN) Competition Best Practice for Energy Management in Buildings and Industries. The La Union plant was cited for its use of alternative fuel and raw materials to reduce its coal consumption, while Bulacan was recognized for its best practices in energy management through process improvements.

Plants operated by Holcim Philippines in Misamis Oriental and Davao City picked up awards for energy efficiency in 2015. In 2014, the company’s Bulacan plant was elevated to the Hall of Fame for receiving the Outstanding Award for three consecutive years.

The Don Emilio Abello Energy Efficiency Awards, run by the Department of Energy, recognise firms that significantly reduce their energy consumption. Participating companies submit consumption reports that are evaluated by energy officials from the public and private sector. The award is a tribute to Emilio Abello, the former Meralco chairman and chief executive officer.

Construction firm DMCI Holdings announced plans this week to enter the Philippine cement market. The company intends to build one cement plant on Semirara and three cement grinding plants elsewhere – at Batangas, Iloilo and Zamboanga – to give it a national presence. DMCI’s managing director Victor Limlingan admitted to local press that his company was taking a gamble on spending US$368m in this way.

It has staked its money on the Duterte Infrastructure Plan, a scheme from the new administration that was elected in June 2016 to target US$165bn (!) towards infrastructure spending until the early 2020s. Even if a portion of this money makes it from political hyperbole to the diggers then it is likely to mean a sustained construction boom for an economy that is already growing at around 6%/yr. DCMI’s excitement was almost palpable in mid-November 2016 when it put out a press release calling for potential partners to help it benefit from the rush when it comes. Although the company did add that all the discussions were at the exploratory stage at this time because it was still awaiting bidding documents.

DMCI’s project joins six plants in various stages of planning and construction from San Miguel, Northern Cement, Eagle Cement and LafargeHolcim. In addition four existing plants are carrying out upgrades to increase their production capacity. Clearly, things are looking up for the local cement industry. DMCI follows San Miguel which announced that it was going to spend US$1bn on building five cement plants around the country in mid-2015.

In line with this kind of investment the Cement Manufacturers Association of the Philippines (CEMAP) said that cement sales had risen by 10.1% year-on-year to 20.1Mt in the first three quarters of 2016. This follows annual sales growth of 8.7% to 21.3Mt in 2014 and of 14.3% to 24Mt in 2015. CEMAP’s data for 2015 also shows that local demand overtook the country’s kiln capacity in 2014. Subsequently imports peaked to 314,000t in 2014, the highest level since 2002.

The country’s second largest producer Republic Cement, a joint venture between CRH and Aboitiz, reported sales growth similar to CEMAP’s one for the first three months of the year. LafargeHolcim, the largest producer, didn’t reveal any figures in its third quarter report but it marked the Philippines as one of its key contributors in the quarter. By contrast, Cemex noted lower growth in its third quarter report at 4% for the nine months to September 2016. It also said that the government transition following the election had slowed cement consumption, especially from infrastructure projects.

The Philippine cement industry is in the enviable position of being in a boom. The kind of problems it has to cope with includes provincial cement shortages, lobbying to increase usage of blended cements, scrutiny of prices by the government and a rise in technical smuggling. Once the new plants and upgrades start becoming operational the true nature of the market should become more apparent. At present it looks likely that DCMI gamble may turn out to be a wise one. The next question will be how many more companies want a piece of the piece too?

Philippines: Holcim Philippines’ profit was flat year-on-year in the first quarter of 2016 at US$31.7m, despite revenues increasing by 17% to US$213.6m. The company reported, however, that production costs rose by 23%, eating into revenues.

Holcim Philippines president and country chief executive Eduardo Sahagun said that the company’s first-quarter performance was due to its ability to make supply available in the market on time and its strong regional presence.

“Moving forward, we are cautiously optimistic as we await the results of the coming elections. Hopefully, the focus on infrastructure remains, as this is much needed by the country to sustain its development,” Sahagun said.

Cement demand in the Philippines grew 12% in the first quarter of 2016, on sustained rollout of private sector projects and higher state spending for infrastructure.

Philippines: Holcim Philippines has reported a rise in net profit of 58% year-on-year to US$171m in 2015. Its revenue rose by 15% to US$793m. It attributed the gain to increased government spending in infrastructure projects and higher construction activity. Profits also benefited from a US$55m gain from the revaluation of an investment in an affiliate. The LafargeHolcim subsidiary also reported that it is increasing its cement production capacity to 10Mt in 2016 from 8Mt in 2015 to benefit from anticipated infrastructure spending.

Philippines: Holcim Philippines' profits more than doubled in the third quarter of 2015 due to strong sales from sustained construction activity into the rainy season. Its net income grew to US$32.5m from US$15.3m in the same period of 2014. Its net sales rose by 23.2% year-on-year to US$212m.

Holcim Philippines' profits for the first nine months of 2015 grew by 12.7% to US$96.7m. This brings the company's sales for the first nine months of 2015 to US$595m, some 9.44% higher than in same period of 2014. Cement demand was healthy nationwide and strongest in Visayas and Mindanao, with no let-up in the building activity by both the private and public sectors.

Holcim Philippines Country CEO Eduardo A Sahagun said that the company's third quarter results were made possible by the improved performance of the plants, which can now operate longer before maintenance activities. "Demand usually dips during the rainy season but this time, we experienced even stronger demand in the third quarter. Under these conditions, it is critical to sustain operations to support the market and we did so due to the steady investments for better plant performance," said Sahagun. Sahagun said that logistics operations also improved with more flexibility to supply the National Capital Region through its newly-acquired Holcim Manila Terminal.

Philippines: Holcim Philippines will invest up to US$40m to expand its production capacity from 8Mt/yr to 10Mt/yr target by the end of 2016.

Holcim Philippines president and CEO Eduardo A Sahagun said that the company was gearing up to improve its facilities in Calaca and Mabini in Batangas, as well as in Norzagaray in Bulacan. Sahagun said that the newly-acquired Star terminal of Lafarge Republic would also increase its production capacity.

"We are reviving a lot of projects. Our Calaca plant is easily adjustable to additional volume as well as the Mabini plant and the Star terminal. The Star terminal could double our capacity. Cement demand is growing and we have no option but to raise our supply," said Sahagun. He expects to see surging market demand due to new public-private partnership (PPP) projects and as more infrastructure major players in the country have announced expansion plans.

"The market prospects remain bright as construction activity is expected to continue," said Sahagun. He attributed the growth to higher private construction activities and accelerated government infrastructure spending.

"Our investment in plant upgrades allows our plants to run longer before scheduled maintenance activities. This will pay off in the current market environment as we are able to meet the demands of customers," Sahagun added.

Philippines: Philippine construction activity growth, which slowed to 4.4% in the first quarter of the 2016 fiscal year compared with an average 5% growth in the previous three quarters, appears to have picked up in the second quarter of fiscal 2016, which ended on 30 June 2015, as indicated by Holcim Philippines' sales over the period and reported by Dow Jones.

In the second quarter of its 2016 financial year, Holcim Philippines' net sales rose by 9.7% year-on-year to US$212m, aided by higher sales volumes and prices. Holcim president Eduardo Sahagun said that the company was improving plant efficiency and upgrading it to run longer to cover strong demand. He said that cement prices don't appear to be as big a concern as supply. "We understand that contractors are most concerned with steady cement supply and this is what we are trying to address in the second half," said Sahagun.

Philippines: Holcim Philippines Inc plans to expand its market and offer a wider range of construction solutions following its acquisition of Lafarge Republic Inc's Star terminal in Manila and its aggregates business in Rizal. Holcim Philippines president and CEO Eduardo Sahagun said that the purchase is a welcome addition to the company's business.

"These assets further strengthen our ability to provide products and solutions that help our customers and partners in the construction industry," said Sahagun. He said Lafarge's Star terminal would strengthen Holcim Philippines' ability to support customers in Metro Manila and South Luzon, while the acquisition of Lafarge Republic Aggregates Inc, located in Angono, Rizal, would provide the company an established aggregates business. Holcim Philippines closed the deal on 4 August 2015 and paid US$67.5m for the assets.

Philippines: Holcim Philippines has posted a net profit of US$38.0m for the second quarter of 2014, slightly higher than the US$37.4m reported for the same period of 2013, with sales on pace to meet internal targets amid robust demand from the construction industry. Revenue was US$203m during the second quarter of 2014, up from US$188m for the same period of 2013.

This brought first half 2014 net profit to US$76.6m, up from US$70.3m in the first half of 2013, while revenue for the period was US$389m, compared with US$355m in 2013. Holcim Philippines' president and CEO, Eduardo A Sahagun, said that the company is 'on track' with its 8% short-term sales growth target, as well as its 5% to 6% sales growth target for the long term.

"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 Sahagun. "We were able to meet this demand due to our ability and commitment to keep the market supplied during this period of robust growth." Other factors that contributed to the company's growth were 'full-swing' construction during the summer months and post-calamity construction in the Visayas Region.

Holcim, which has a local market share of around 34%, is currently in the process of merging with Lafarge, which has a share of around 28%. Sahagun said that the merger might be finalised by May 2015, resulting in a combined market share of 62% in the Philippines.