Eagle Cement Corporation (EAGLE) reported that it continued to turn in a profit in the second quarter of the year even as the Philippine economy fell into a recession due to the lock down to contain the spread of the COVID-19 pandemic.
In a disclosure to the Philippine Stock Exchange, EAGLE reported a second quarter net profit of P128 million, down 92 percent from the P1.7 billion earned over the same period in 2019, as net sales dropped 73 percent to P1.4 billion.
For the first half of 2020, the firm posted a net profit of P1.3 billion, down 61 percent from the same period last year, as net sales dropped 44 percent to P5.9 billion.
EAGLE said it expects the strong performance it saw in early 2020 to resume once the government eases further the quarantine restrictions, especially in Luzon.
“These are very difficult times but we remain confident that the economy will recover from this pandemic and emerge stronger,” said EAGLE President & CEO Paul Ang.
He noted that, “The government’s steady push for the completion of major infrastructure projects and the private sector’s readiness to bounce back offer encouraging signs for our Company’s prospects moving forward.”
Ang said that the pandemic that has negatively affected the economy this year has created a highly competitive cement market that could squeeze profits.
“More aggressive strategies in pricing and marketing will be undertaken in the remaining half of the year,” he added.
Even with the slide in profitability, EAGLE continued to showcase a strong financial position at the end of June to withstand any external adversities amid the crisis.
Total assets amounted to P45.8 billion, a 7 percent drop from the end-2019 figure while total liabilities likewise declined by 13 percent to P10.2 billion.
“Our balance sheet remains strong and well-capitalized and the Company is well-positioned to take advantage of a rebound in the construction industry. We continue to expand our production capacity despite the pandemic, underscoring our confidence on the economy’s ability to recover once quarantine restrictions are further eased,” said Ang.