SUMMARY
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MANILA, Philippines – First Pacific-led Roxas Holdings Incorporated incurred a net loss of P125 million ($2.62 million) in the quarter ending December 2015, because of operational challenges affecting its two manufacturing plants.
Roxas Holdings Chairman Pedro Roxas said that while first quarter results are low, the company reeled from the combined impact of insufficient cane supply, late startup in its Batangas plant, and temporary shutdown of its newly-acquired plant.
First quarter operating revenues were higher by 130% to P2.7 billion ($56.71 million) from P1.17 billion ($24.57 million) recorded in the same period.
But operating expenses also accelerated by 160% P2.59 billion ($54.4 million) from only P998 million ($20.97 million) booked in the same period a year ago.
Roxas Holdings president and CEO Hubert Tubio said the combined gross profit of Central Azucarera de la Carlota Incorporated (CACI) and Roxol Bioenergy Corporation (RBC) – both in La Carlota City in Negros Oriental – was not sufficient to carry the group’s total expenses for the period.
At the same time the San Carlos Bioenergy Corp Incorporated – an ethanol firm the group acquired in May last year – had to temporarily cease its operations to give way to enhancement initiatives to improve plant efficiencies.
A temporary setback
Tubio said the first quarter’s net loss is only a temporary setback and that the company is expected to improve its performance by yearend.
“We hope to see an improvement in our full year core net income,” Tubio said.
Roxas Holdings has also earmarked P1.4 billion ($29.41 million) in capital expenditures for this year primarily to address operational challenges.
Its board of directors, in its recent meeting, agreed to offer common shares to the common shareholders of the company.
The final terms and conditions of the stock rights offering will be announced once these are finalized, Roxas Holdings said.
Through its subsidiary First Agri Holdings Corporation, First Pacific in February 2015 acquired 241,780 million treasury shares of Roxas Holdings for P1.7 billion ($35.72 million). This results to an increase in effective interest to 51% from 34%, making First Pacific the major shareholder of Roxas Holdings.
The Roxas group, however, continues to own 31% interest in the company. — Rappler.com
$1=P47.59
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