Lafarge Republic boosted by robust demand

Lafarge Republic Inc (LRI) reported a 30 per cent rise in net profit last year to PHP3.7bn (US$82.6m) on the back of robust demand from government as well as private commercial sector projects.

Revenue increased by 16 per cent to PHP23bn with the company attributed to increased cement demand as well as sales and marketing initiatives.

Cost of sales increased mainly due to higher prices for power and raw materials. LRI said it was able to moderate the increase by utilising coal in its kilns which have a lower price, while at the same time increasing its use of alternative fuels.

“Continuing operational efficiencies also helped to partially offset the cost increase. Notwithstanding these initiatives, higher costs remain a key concern and challenge in the future.” LRI president, Renato Sunico, said.

Last year the Philippine cement industry saw a 5.9 per cent YoY increases in demand to 19.4Mt. With the outlook for domestic cement sector remaining upbeat, Lafarge is implementing two new mills, one at its Bulacan facility and the other at its Rizal works, both due for commissioning in the first half of 2015. In 2013 the company reopened its Danao plant in Cebu and implemented key debottlenecking projects at Iligan and Norzagaray plants.