Cemex Holdings Philippines Inc. incurred a net loss of P355.48 million in the first three months this year from last year’s income of P261.3 million on lower sales as domestic volumes fell.
Consolidated net sales for the period fell 11 percent to P4.64 billion from previous year’s P5.24 billion. Cemex said its domestic cement volume decreased by 16 percent on lower cement demand.
Cemex projects a low single-digit percentage decrease on domestic cement sales volume this year.
“As commented last February, we expect 2023 to be a year of transition for our company. Although we have already noticed an inflection point in costs such as fuel and electricity, our expectations remain that market conditions and cost inflation will continue to be challenging through the first half of 2023. With uncertain market conditions in the foreseeable future, we remain focused on finding efficient and sustainable ways of running our operations and improving results,” Luis Franco, the company’s president, said.
“In light of significant input cost inflation and market challenges, CHP remains focused on the variables within its control, especially on the cost side, with substantial progress,” he said.
Domestic cement prices rose 5 percent during the quarter, a reflection of the strategy to offset the sharp input cost inflation the company has experienced in fuel, electricity, and transport.
Cost of sales as a percentage of net sales stood at 79.7 percent during the quarter, an increase of 17.7 percentage points year-over-year due to higher fuel and power costs.
Fuel cost as a percentage of net sales was at 29.1 percent during the quarter, an increase of 10.9 percentage points year-over-year, driven by steep inflation in global energy prices in 2022.
Power cost as percentage of net sales was at 15.2 percent, an increase of 3.2 percentage points year-over-year resulting from higher power rates due to renegotiations of electricity contracts in the second half of 2022.
In February, the company shifted to a more cost-efficient fuel mix at its Apo Cement plant and has increased the use of alternative fuels in both Solid Cement and Apo Cement plants.
The company said its unitary fuel cost in March 2023 was its lowest since April 2022.
