Roxas Holdings plunges to P1.9 billion crop year loss

MANILA, Philippines — Listed bio-sugar and bio-energy company Roxas Holdings Inc. (RHI) has incurred a P1.9 billion net loss for the current crop year due to a challenging sugar industry.

This is a reversal of the P55 million net income reported the previous crop year.

Consolidated revenues increased to P13.3 billion on higher sales volume and price of alcohol, as well as milling revenues.

However, RHI, and the industry as a whole, faced a tough market with local sugar output declining 17 percent to 2.072 million metric tons due to unfavorable weather conditions.

“Talks on the liberalization of the sugar industry were also rampant during the period, causing a softening of sugar prices, while feedstock costs continue to increase. Our results reflect the impact of these challenges,” RHI chairman Pedro Roxas said.

While the sugar business grappled with challenges during the period, RHI’s ethanol business achieved some operational improvements due to upgrades in its equipment and systems.

One of RHI’s ethanol units, Roxol Bioenergy Corp., recorded its highest methane fuel displacement of 60.67 percent last May as the anaerobic digesters continue to generate improved levels of biogas.

RHI operates RBC and San Carlos Bioenergy Corp. Inc. (SCBI), the country’s biggest ethanol producers with a combined capacity of 285,000 liters per day.

Company president and chief executive officer Hubert Tubio is looking at a better sugar industry next year following the Senate’s unanimous resolution against sugar liberalization which should help stabilize the market.

“RHI continues to seek ways to refine its competitive advantage despite the many ongoing industry challenges. We are actively engaging our stakeholders as we work closely with government in crafting solutions to issues hounding the industry,” Tubio said.

Meanwhile, RHI’s net debt decreased to P9.8 billion from P10.7 billion last year despite higher interest rates that partially negated efforts to reduce overall indebtedness.

“Net proceeds from the sale of certain assets in November 2019 were used to further reduce long-term debt by close to P900 million. We will continue to look for opportunities to significantly reduce our debt levels,” RHI executive vice president and chief finance officer Celso Dimarucut said.

RHI is the largest integrated sugar business in the Philippines which manages 100 percent of Central Azucarera Don Pedro in Batangas, and Central Azucarera de la Carlota, RCB and majority of SCBI.