Eagle Cement Corp., the listed cement company owned by billionaire Ramon Ang, posted a net income of P3.3 billion in the first nine months of 2017, up eight percent from P3.06 billion year-on-year, despite lower cement prices following stiff competition.
Excluding expenses related the company’s recent initial public offering, core net income increased by 10 percent.
Eagle Cement said in a disclosure to the stock exchange the healthy nine-month profit was on the back of double digit growth in sales volume.
Nine-month net sales increased 12 percent to P11.24 billion from ₱10.05 billion in the first nine months of 2016 as the 20 percent increase in sales volume partially offset the continued decline in the average selling price of cement compared with last year’s average.
Aside from increased competition among local cement producers, the industry is also facing competition from cheap imports.
“Nevertheless, Eagle’s advantage of having a new and state-of-the-art plant as well as its prudent cost structure help keep the profitability above expectation,” the the company said
“Also, with its third production line in Bulacan to be commissioned in 2018, Eagle is best poised to withstand the imports threat,” it added.
The third production line in Bulacan has a production capacity of 2 million metric tons and will boost the group’s total capacity to 7.1 million MT.
It will also break ground on its newest cement plant in Cebu this year.
Other cement companies, like Cemex Philippines and Holcim Philippines, earlier reported declines in their profits in the first nine months of the year, citing weak demand and a steep decline in prices.
Net income of Cemex Holdings dropped 63 percent in the first nine months to P688 million while Holcim Philippines registered a 57.6 percent decline to P2.3 billion.
Eagle Cement, meanwhile, is managing costs to maintain its margins. Cost of goods sold in the nine months ending September 30, 2017 rose 19 percent, slower than the 23-percent increase in volume due to a lower cost per bag.