Low sugarcane supply curbs Roxas Holdings’ profit

ROXAS Holdings Inc. (RHI), a leading local sugar firm, saw a 28-percent year-on-year decline in nine-month net profit ending June to P329.26 million due to low sugarcane supply and higher cost of raw materials.

But for the quarter ending June or the third quarter in its fiscal year, the situation has improved as RHI chalked up a net profit of P191.11 million, 39.5 percent higher than the level in the previous year, the company said in a regulatory filing.

In a press statement, RHI chair Pedro Roxas said the group had put in place measures to address the low cane supply situation, particularly in its Central Azucarera de la Carlota plant
in Negros Occidental.

“We hope to stabilize the cane supply situation across all our operations in Negros Occidental and Batangas through the programs we have started to roll out,” Roxas said.

RHI president Renato Valencia said the low cane supply also affected the group’s cash flow as measured by earnings before interest, taxes, depreciation and amortization (EBITDA), which dropped by 10 year-on-year to P1.16 billion.

“Most of our subsidiaries performed positively in the third quarter and we are looking
at further improving results by the fourth quarter,” Valencia said.

RHI revenues for the quarter ending June rose by 49.5 percent year-on-year to P3.11 billion. For the nine-month period ending June, its revenues went up by 4 percent year-on-year to P6.58 billion.

RHI is a leading Philippine sugar refiner and manufacturer with its Central Azucarera Don Pedro, Inc. in Batangas; and Central Azucarera de la Carlota, Inc. and Hawaiian-Philippine Company, Inc. in Negros Occidental.

For the nine-month period, refined sugar sales amounted to P2.08 billion while raw sugar contributed at P1.88 billion. Revenue from sale of molasses, tolling services from refinery and other activities amounted to P733 million.

The ethanol business contributed P1.88 billion. Last May, RHI acquired majority of San Carlos Bioenergy in Negros Occidental, in addition to its Roxol Bioenergy Corp. also in the same province —making the group one of the biggest ethanol players in the Philippines. Ethanol sales rose by 79 percent year-on-year due to better yields from Roxol Bioenergy plant and with the increased volumes from the newly acquired San Carlos Bionergy Inc.

On the other hand, net operating expenses for the period rose by 31 percent year-on-year to P660 million.

The First Pacific group controls 50.9 percent of RHI while Roxas & Co. maintains a 30.96 percent stake.