LISTED sugar producer Roxas Holdings Inc.’s (RHI) said its consolidated net income in the first half of its fiscal year grew 15 percent to P76 million, from P66 million a year ago.
RHI said the increase in its bottom line in the first six months was driven by the higher production level of its sugar businesses, offsetting the low price of sugar in the domestic market.
“Despite lower sugar prices resulting in lower revenues during the current half of the year compared to the corresponding period last year, RHI’s sugar unit recorded an increased gross profit rate of 19 percent, from 13 percent in 2016, due to the increased level of production output and the resulting reduction inproduction unit cost.”
RHI said its consolidated revenues in the first half ending March 31 decreased by a third to P4.963 billion, from P4.13 billion during the same period last year, due to a reduction in raw sugar sales by almost P1.664 billion.
RHI said the raw-sugar production of Central Azucarera de la Carlota Inc. (CACI) in the first half reached 4.926 million 50-kilogram bags (Lkg bags), 9.15 percent higher than the 4.513 million Lkg recorded during the same period last year.
“CACI is poised to hit a new high of above 2 million tons of cane milled this crop year, more than 40 percent higher than last crop year,” RHI said.
For its ethanol production, RHI said its output in the first half reached 35.1 million liters, slightly higher than the 33.4 million liters recorded a year ago.
RHI Chairman Pedro E. Roxas said both its sugar and alcohol units had improved significantly in the second quarter, boosting first-half results.
“The increase in our first-half net income reflects the impact of the efficiencies brought about by RHI’s continuing investment across all our plants,” Roxas said.
RHI President and CEO Hubert D. Tubio said their company responded well to the current sugar-industry situation, where the price of sugar in the domestic market has continuously declined.
“Our sugar and ethanol units were able to overcome the impact of lower sugar prices and the increase in ethanol inventory during the period,” Tubio said.
“The current peak in sugar production, higher importation level of high-fructose corn syrup and the previous year’s sugar importation caused significant volatility in raw-sugar prices, while the alcohol unit’s volume slowed down due to the industry’s increased inventory levels,” Tubio said.
CFO and EVP for Finance Celso T. Dimarucut said, despite the lower sugar prices and softer sale of alcohol, the completion of the enhancements to both the sugar and ethanol plants will help RHI meet its full-year financial and operational targets.
RHI is the largest integrated sugar business and the biggest ethanol producer in the Philippines.
The company’s ethanol businesses Roxol Bioenergy Corp. and San Carlos Bioenergy Corp. Inc. are the country’s biggest ethanol producers with a combined capacity of 285,000 liters per day.