Asia / Oceania
Lafarge reports flat 2011 sales due to weak demand
Jul, 09 2012
(Philippines) -- Lafarge-associated company Republic Cement Corp. (RCC) reported to its stockholders that sales performance for 2011 was almost at par with that of 2010, mirroring the nearly flat nationwide market demand for cement last year. RCC also stated that it is looking forward to opportunities to grow its current market this year.
RCC president Renato Sunico reported that the almost flat nationwide cement demand of 15.6 million metric tons was due to the reduced infrastructure spending by the government during the first three quarters of 2011. Cement market prices also softened during the year which contributed to lower sales revenue for RCC despite sustained sales volume.
Increased power and fuel costs were also major challenges for the company in 2011, which were addressed by focusing on operational efficiency, increased use of alternative fuels and better plant reliability. Sunico highlighted the Waste Heat Recovery Project of RCC’s Teresa Plant which received a Clean Development Mechanism certification from the United Nations Framework Convention on Climate Change (UNFCCC). The WHR reuses waste heat by converting it to electricity, meeting approximately 30 percent of the plant’s power requirements and reducing its dependency on fossil fuel.
RCC also expanded its market coverage in 2011 to new areas in Northern Luzon, Western Visayas and Southern Mindanao and launched a new product — Portland Duo, a blended Bulk Cement product, adding to its product range, currently the widest in the country.
Sunico cited people development, effective labor relations and community relations, and putting utmost priority on safety as contributory to RCC’s satisfactory performance despite the challenging environment.
Supported by the increased cement demand from the private and commercial sectors, the company ended the year with a consolidated net income of P2.48 billion.
“The company is targeting to further grow its current market and is also prepared to supply the expected cement demand as the government’s infrastructure projects come on stream. As with 2011, fuel and power prices will remain a concern in 2012 but I’m confident that these costs can be managed with the company’s use of more alternative fuels, efficient operation of its WHR system, cost-effective schedule of milling operations and other operational efficiencies”, Sunico said.
At the stockholders’ meeting, the name change of the publicly-listed company Republic Cement Corporation to Lafarge-Republic, Inc. was also approved, subject to regulatory approvals. The change aims to combine the strength of the global brand “Lafarge” with the solid reputation in the Philippines of the “Republic” name and further increase stakeholders’ awareness of the Company’s association with Lafarge, a world leader in building materials.
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