Cemex PH gains weighed down by FX losses, ‘Odette’

Cement maker Cemex Holdings Philippines Inc. suffered a 26 percent year-on-year fall in net profit in 2021 to 726 million pesetas on exchange losses, while its fourth quarter became unprofitable due to bad weather, including disruption from Typhoon Odette. ”

Cemex reported attributable net income of P726 million last year, down from P985 million a year earlier, the company told the Philippine Stock Exchange on Friday.

As the local currency depreciated against the US Dollar, the Company incurred foreign exchange losses of P437 million in 2021, a reversal of foreign exchange gains of P170 million in the prior year.

As such, the company made less than half the profit of about 1.5 billion pesos that the market had been expecting for 2021 based on the Bloomberg consensus.

For the fourth quarter alone, Cemex posted a net loss of P172 million compared to a net income of P227 million for the same period last year. As domestic cement volumes fell 2 percent year-on-year in the quarter, operating profits fell 82 percent to Ptas 52 million.

Fourth-quarter sales were flat year-on-year at about P4.6 billion, mainly due to Odette disrupting the operations of its Apo Cement unit.

Typhoon Odette – one of the costliest typhoons in Philippine history – hit the central and southern parts of the Philippines in mid-December, disrupting Cemex operations in Cebu.

“While Apo Cement suffered property damage due to Typhoon Odette, major assets were not damaged. The apo facility was operational after the typhoon, but volumes have been impacted due to recovery efforts and infrastructure damage,” the company reported.

For the full year, however, consolidated net sales rose 6 percent to 20.9 billion pesos, reflecting higher volumes in previous quarters. Despite the slump in the fourth quarter, domestic cement volumes increased by 7 percent in 2021.

cement prices

The company’s cement prices in the fourth quarter were 3 percent higher year-on-year but down 2 percent on average for the year.

“Despite the challenges of COVID-19, adverse weather and rising input costs, we are proud of our achievements in 2021. We are committed to health and safety, improving customer experience and meeting our sustainability goals,” said Ignacio Mijares, President and CEO of Cemex said.

In 2021, the Company reported that its Apo Cement Plant and Solid Cement Plant recorded operational milestones related to higher production, lower clinker factors and increased use of alternative fuels.

The company now offers new-generation cement products, which it claims are “high quality” and “environmentally friendly,” with a 15 to 40 percent lower carbon footprint than traditional Portland cement.

In 2022, the company expects its cement volumes to continue to recover, with construction activity continuing to be a driver of the country’s economic growth. It noted that the 2022 state budget was the highest in Philippine history, 11.5 percent higher than the 2021 state budget, with 17 percent allocated to the Department of Public Works and Highways and the Department of Transportation.

Cemex is an indirect subsidiary of Mexico-based Cemex SAB de CV, a global building materials company.

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