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Ethanol Sales Lift Sugar Miller Roxas Holdings’ Profit

December 23, 2014
Business World
By Claire-Ann Marie C. Feliciano

HIGHER SALES of ethanol drove Roxas Holdings, Inc.’s (RHI) profit in its fiscal year ending September, the listed sugar miller said in a regulatory filing on Tuesday.

 

It said its net income after tax jumped 30% to P615 million in its October-September fiscal year from the previous year’s P473 million.

RHI Chairman Pedro E. Roxas attributed the result to strong ethanol sales after the sugar miller more than doubled the volume of production.

“Our ethanol sales climbed P1.5 billion on the back of higher ethanol production to 32 million liters from 14 million liters last year,” Mr. Roxas said in a statement filed with the Philippine Stock Exchange.

The company’s margins have been squeezed, falling by 70%, given “operational challenges,” RHI Chief Executive Officer Renato C. Valencia said in the statement.

But Mr. Valencia, who also sits as company president, said major investments -- including an upgrade in facilities and a boost in efficiencies -- should temper the impact of those challenges, which would be compounded by a 5% drop in sugar tariffs that is part of a free trade agreement among members of the Association of Southeast Asian Nations.

“The drop in our total bank debts by P2 billion for FY 2014 helped boost our NIAT (net income after tax),” Mr. Valencia said.

RHI’s revenue climbed 37% to P8.3 billion from a year ago’s P6 billion.

RHI is an integrated sugar business whose subsidiaries are Central Azucarera Don Pedro, Inc. in Nasugbu, Batangas, the Central Azucarera de la Carlota, Inc. and bioethanol producer Roxol Bioenergy Corp. in La Carlota City, Negros Occidental.

In November last year, First Pacific Company Ltd. acquired a 31% stake in RHI.

Shares of RHI were last traded at P6.90 apiece on Tuesday, up by 14 centavos or 2.07% from Monday’s closing price.

First Pacific partly owns Philippine Long Distance Telephone Co. (PLDT). Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld.