By James A. Loyola
Cemex Holdings Philippines Inc. (CHP) recorded a net loss of P930 million in 2018, a sharp drop from the P659 million profit it booked in 2017 due to higher income tax expenses, foreign exchange losses and lower operating gains.
In a disclosure to the Philippine Stock Exchange, the firm said its cement volumes for full year 2018 increased by 7% compared to 2017 driven by healthy demand from both the private and public sectors.
CHP had record volumes in the third quarter and first half of the year, as sales revenues reached P23.4 billion in 2018 from P21.78 billion in 2017.
However, the company’s financial performance was adversely affected during the fourth quarter following the landslide that happened in the City of Naga in Cebu on September 20, 2018.
CHP obtained raw materials from farther sources which led to an increase in cost of sales, as a percentage of sales, to 66 percent in the last quarter from 58 percent during the same period in 2017.
As a result, the company’s operating EBITDA margin went down during the fourth quarter, to 7 percent from 12 percent, and for full year 2018, to 12 percent from 15 percent, against the respective periods in 2017.
For the first nine months of 2018, operating EBITDA margin of CHP was at 14 percent, with the margin decline on a full year basis mainly due to the increase in cost of sales during the last quarter.
“The past quarter was a very challenging one following the landslide in Naga City. It tested the strength and resolve of all who were affected. The perseverance of the community was very inspiring even as we worked on restoring our operations to normality,” CHP President and CEO Ignacio Mijares, said.
He noted that, “we are excited about the prospects for the company in 2019 and see continued strong cement demand in the country. For this reason, we remain focused on improving our operations and completing our expansion in a timely manner.”