Holcim PH profit down on high fuel, energy costs

March 27, 2023 12:00:00

Industry giant Holcim Philippines maintained robust revenues last year despite softer demand while profits fell lower amid surging inflation.

In a statement, the company said revenues for the year were down 1.3 percent to P26.59 billion, which the company said was lifted by a sales rebound that materialized in the latter part of the year.

"In the face of extraordinary challenges, our company and people displayed tremendous resilience that enabled us to deliver positive financial performance and contribute to building progress in the country," Holcim Philippines CEO Horia Adrian said in the statement.

Core profit, which removes one-off items, was down 36 percent to P1.64 billion in 2022.

Holcim said bottom line was hit by an "extraordinary surge in fuel and energy costs, which ballooned by 60 percent from the previous year." Fuel and energy accounted for 64 percent of the company's production inputs.

The company blunted the impact on margins by raising prices and reducing other fixed costs by 11 percent, the statement showed.

"With our growing portfolio of high-performance building solutions and retail partners and strong sustainability mindset, we are well positioned for the future," Adrian said.

"We are excited to continue growing the company to deliver value to our shareholders and support the country's development," he added.

Holcim Philippines is one of the country's largest cement producers with a cement production capacity of 10 million metric tons per year and clinker production capacity of 5.2 million metric tons per year. Together with its subsidiaries, it owns and operates four cement production facilities, one cement grinding mill, five ports and multiple storage and distribution points across the country.

Meanwhile, Holcim Philippines said it ramped up its sustainability program last year.

This included the reduction of carbon emissions per ton of cement by 7 percent, helping cut production costs by P1.4 billion.

"The achievement was driven by efficiency initiatives using digital technologies and increased production of blended cement," the company said.

It also accelerated the use of alternative fuels and raw materials.

"Holcim Philippines converted around a million tons of qualified wastes into alternative fuels and raw materials for cement production from industrial partners and 35 local governments nationwide. This also helped the company soften the impact of the surge in fuel and energy costs," the statement read. —Miguel R. Camus INQ