Eagle Cement income grows in 1st half of 2017 despite low cement prices
MANILA, Philippines – Ramon Ang-owned Eagle Cement Corporation saw its net income increase by 13% to P2.2 billion in the 1st half of 2017 even as local cement prices hit a 4-year low.
Its net sales, meanwhile, rose 12% to P7.5 billion in the 1st half of 2017, versus P6.7 billion in the 1st half of 2016, on higher sales volume for both bagged and bulk cement.
Eagle Cement chief finance officer Monica Ang said in a press briefing that the increase in production capacity came from their 2nd production line, which started operations in March 2016. (READ: Meet Ramon Ang, Filipino billionaire and Duterte's friend)
Despite the decline in cement prices, Eagle Cement president Paul Ang said demand remains strong both from the private and public sectors.
"We believe that the cement industry grew by 5% to 6% in the 1st half of the year based on declared numbers from the Bureau of Customs and our own figures. From 25 million to 26 million bags at the end of 2016, we believe that the market grew by 5% to 6% this year," he said.
Cement prices, which range from P170 to P180 per bag, are at a 4-year low because of increased competition in the industry.
Eagle Cement's gross profit margin remains healthy at 48.6% despite the decline in prices.
Income from operations as well as earnings before interest, taxes, depreciation, and amortization (EBITDA) reached P2.9 billion and P3.4 billion, an increase of 5% and 11%, respectively.
As the company's financial position remains solid, Eagle Cement said its board has decided not to avail of the remaining P2.1 billion under the term loan facility with various local financial institutions led by the Bank of Commerce.
The cement firm is also scheduled to compete the 3rd production line in its plant in Bulacan by the 1st quarter of 2018. This will boost the company's cement capacity by another two million metric tons (MT) to 7.1 million MT.
Eagle Cement will also break ground on its newest cement plant in Cebu this October. The P12-billion cement plant will have a capacity of two million MT. It is slated for completion by 2020. – Rappler.com