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Eagle Cement profit drops to P2.7 B due to lockdown

Eagle Cement Corporation, one of the largest cement producers in the Philippines, reported a 43 percent drop in net income to P2.7 billion in the first nine months of 2020 from P4.7 billion in the same period last year but saw signs of improvement in the third quarter.

In a disclosure to the Philippine Stock Exchange, Eagle Cement said net sales reached nearly P10.0 billion in the first nine months of 2020, 35 percent lower than the P15.3 billion it generated in the corresponding period last year.

This came after a strong start in 2020 was disrupted by the implementation of lockdown in the wake of the Covid-19 pandemic that began in mid-March this year.

Gross profit was at P4.1 billion, a 39 percent decline from P6.7 billion a year ago, with margin registering at 41 percent. 

Eagle Cement said its third quarter performance showed signs of improvement as the government eased COVID-19 quarantine restrictions to Modified General Community Quarantine (MGCQ) in most areas and allowed construction and major infrastructure projects to resume.

For the third quarter of 2020, Eagle Cement’s net profit reached the same level in 2019, amounting to P1.4 billion, despite net sales slipping 16 percent year-on-year to P4.1 billion.

The decline in net sales was less steep than the second-quarter fall of 73 percent. Quarter on quarter, net sales significantly grew by 192 percent. 

Gross profit for the quarter similarly declined by 14 percent to P1.8 billion. Meanwhile, earnings before interest, taxes, depreciation and amortization (EBITDA) grew by 9 percent to P2.0 billion, with a wider margin of 50 percent.

“The resumption of major infrastructure projects and retail segment boosted sales. We are optimistic that fourth-quarter results will be better as more sectors of the economy are reopened,” said Eagle Cement President and CEO Paul Ang.

As a sign of its optimistic outlook despite the pandemic, Eagle Cement is scheduled to complete by the first quarter of 2021 a new mill in Bulacan that will have a capacity of 1.5 metric tons and boost total annual cement output to 8.6 million metric tons.

This production capacity is expected to support Eagle Cement’s upcoming projects as most construction operations resume by next year.


Source: Manila Bulletin (https://mb.com.ph/2020/11/10/eagle-cement-profit-drops-to-p2-7-b-due-to-lockdown/?utm_source=rss&utm_medium=rss&utm_campaign=eagle-cement-profit-drops-to-p2-7-b-due-to-lockdown)

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