MANILA, Philippines — Sugar producer Roxas Holdings Inc. grew its net profit in the six-month period ending March by 36 percent year-on-year to P205 million on better gross profit margin, lower operating expenses and lower debt burden.
In a statement on Monday, RHI also said net income for the quarter ending March 31 alone had surged by 141 percent year-on-year to P171 million from P70 million on the back of higher revenues.
For the first semester of its fiscal year, RHI reported a 19-percent decline in consolidated revenues to P2.9 billion. The company said last year’s comparative revenue level of P3.5 billion included a one-time export of carry-over raw sugar from the preceding crop year amounting to P1.1 billion.
“Our gross profit margin for the first six months was higher due to increased volumes of sugar produced despite low prices. The group’s operating expenses also improved with the cost reduction measures that were put in place beginning last year. The decline in interest expenses also boosted the group’s net income,” RHI chair Pedro Roxas said.
RHI president Renato Valencia added that cost reduction measures implemented across the group were gradually paying off and boosting overall operations, particularly in the case of Central Azucarera de la Carlota Inc. (CACI) in Negros Occidental.
“The cost reduction measures had spurred positive results in the group’s milling operations and relations with planters. In the case of CACI, the fast turnaround of trucks within the district and the services it offers have attracted more planters, even those outside the district, to mill with CACI,” Valencia explained.
CACI milled 1.92 million tons cane for the period, up by 8.5 percent year-on-year. Its production yield also rose to 2.14 bags per ton cane from 1.99 previously. Raw sugar production also climbed by 17 percent to 4.12 million bags per ton cane from 3.52 million last year.
Valencia reported that production at RHI’s other subsidiary, Central Azucarera Don Pedro, Inc. (CADPI) in Batangas, experienced a slowdown during the period due to some operational issues that needed to be addressed immediately.
On the group’s net income for the quarter ending March, the 141 percent year-on-year rise in net profit to P171 million was attributed to the 33 percent rise in revenues to P2.2 billion.
“Revenues usually pick up in the second and third quarters of the crop year because the first quarter is the time when cane deliveries and sugar recovery are just starting to build up,” Valencia said.
Milling operations started in September at CACI and in November at CADPI.
“The company is also making headway in its product diversification efforts to further boost the competitiveness of the RHI group. Aside from this, optimizing the capacity utilization of the plants will be pushed for the next year,” the company said.