Cemex Holdings Philippines Inc. posted a net loss of P930 million in 2018, a sharp reversal from a profit of P659 million in 2017, on higher income tax expenses and lower operating and higher foreign exchange losses.
Cemex said in a disclosure to the stock exchange net sales increased six percent to P23.4 billion in 2018 from P21.78 billion recorded in 2017 as cement volume rose seven percent, driven by healthy demand from both the private and public sectors.
The company’s financial performance was adversely affected during the fourth quarter following a landslide in the Naga City, Cebu province on September 20, 2018.
The accident prompted the cement firm to secure raw materials from farther sources that led to an increase in the cost of sales to 66 percent in the last quarter from 58 percent year-on-year.
As a result, the company’s operating EBITDA (Earnings before interest, taxation, depreciation and amortization) margin fell during the fourth quarter to seven percent from 12 percent, and to 12 percent from 15 percent for the full of 2018.
“The past quarter was a very challenging one following the landslide in Naga City. It tested the strength and resolve of all who were affected. The perseverance of the community was very inspiring even as we worked on restoring our operations to normality,” Cemex president and chief executive Ignacio Mijares said.
In October, one of CHP’s main subsidiaries, Solid Cement, signed a procurement, construction and installation agreement with CBMI Construction Co. Ltd of China for the company’s new cement production line scheduled to start operations in the fourth quarter of 2020.
The company is evaluating different options to fund the expansion project, which is expected to cost $235 million.