Refinery woes inflate Roxas Holdings’ losses

MANILA, Philippines — Losses from the sugar refinery business heavily dented the net loss of sugar and ethanol producer Roxas Holdings Inc. (RHI) in the fiscal year that ended in September 2023.

In a disclosure on Wednesday, RHI said net loss for the period hit P2.3 billion, wider by 187.9 percent from P797.01 million in the year-ago period.

At the same time, revenues fell by 19.8 percent to P4.2 billion.

“(T)he group’s sugar refinery operation is on shutdown and will remain (so) in the next year while the operations of the group’s bioethanol plant is put on hold and the related assets are classified as held for sale,” the company said in a statement.

RHI said it is continuously coordinating with prospective buyers to complete the divestment of San Carlos Bioenergy Inc. (SCBI) and sell other idle assets to pay its maturing obligations. The listed firm, however, did not divulge with whom they are in discussions.

“These conditions indicate that a material uncertainty exists that may cast significant doubt on the group’s ability to continue as a going concern and, therefore, that the group may be unable to realize its assets and discharge its liabilities in the normal course of business,” it added.

Mill closure

Through Central Azucarera Don Pedro Inc., RHI is running a sugar milling including its refinery in Batangas province. However, it was forced to permanently cease operations in the area due to business losses.

READ: URC to buy Don Pedro’s mothballed sugar mill assets

Capdi terminated all its employees following the cessation of business operations effective March 29.

According to RHI, Capdi has been affected and/or limited by the increased importation of refined sugar by the national government in the past years. It also said the Sugar Regulatory Administration (SRA) informed them they could offer refined sugar to the public again once the current inventory of refined sugar in the market has been depleted.

“Thus, maintaining Cadpi’s sugar refinery business proves to be extremely difficult and no longer viable,” it said, adding that the depletion of inventory is estimated to take around eight to 12 months.

Apart from Cadpi, RHI is running an ethanol plant in Negros Occidental through unit SCBI, whose operation stopped in November last year due to quality of molasses and cashflow issues.