Holcim posts 17% increase in 1st quarter sales

MANILA, Philippines - Holcim Philippines Inc. reported yesterday a 17 percent growth in sales during the first quarter of this year from a year ago level despite the company’s decision to close one of its production lines in Mindanao.

In a press conference after yesterday’s stockholders’ meeting, Holcim senior vice president Ed Sahagun said they are certain that growth will continue until the second quarter of this year. However, he said they are cautiously optimistic for the second half.

Sahagun said that they had to close one line of the Lugait plant in Mindanao due to the power crisis in the region. He said they have resorted to importing clinker from Japan. He said they already cut their production in Mindanao by 10 percent because of the power shortage.

Sahagun said they are hoping the power crisis situation will improve by the third quarter of this year.

Early this year, Holcim increased the price of its cement by P5 to P8 per bag in Mindanao and Northern Luzon. Sahagun said they will still discuss in July how much they will increase their price for this year.

“Traditionally, we meet incremental demand in Luzon by transferring clinker from Mindanao,” Sahagun said. “Thus far, we have been able to manage supply, but should the Mindanao power situation escalate, we will need to look at other ways to address supply gaps.”

Meanwhile, chief operating officer Roland van Wijen said that the first quarter growth was fueled by election related spending and increase in remittances by OFWs. The construction was dominated by government infrastructure projects. Private sector spending was in commercial and residential projects catered to OFWs.

“Construction activities continue to be strong in Luzon,” Van Wijnen said. “Having a high-performance plant in Bulacan assures us that we will be able to keep our fastest growing markets well supplied.