Mariwasa to close main tile factory

Mariwasa Manufacturing Inc., one of the pioneers in the country’s ceramic tile industry, will be permanently closing the operations of its main plant in Pasig.

Mariwasa corporate information officer Aurasa Jinawath told the Philippine Stock Exchange that the company’s board of directors had voted during a special meeting last week to cease the manufacturing operations at the Rosario, Pasig plant "in view of continued losses being suffered by the corporation."

"The board directed the management to serve the proper notices on all parties concerned and to observe the proper procedures mandated by law as regards the separation of employment of the employees of the corporation affected by the decision," Jinawath said.

She added the board wanted management to observe all provisions of the collective bargaining agreements currently effective, particularly the provision on separation benefits of the employees.

Mariwasa has six wholly owned subsidiaries engaged in specialized ceramic tile making, polished granite tiles, floor and wall tiles, and tile installation. As of end-2000, the Mariwasa group had 924 regular employees.

The company operates its main plant facilities in Rosario but there are other properties in Bulacan and in other areas in Pasig. The operations of five of its wholly owned units are being conducted in a rented property also in Rosario.

Mariwasa is a publicly listed stock but its last trade dates back to December 1999, closing at its par value of P1 per share. The company has an authorized capital stock of P1 billion, of which about P925 million worth of shares are outstanding.

The company was founded in 1963 by the Coseteng brothers Emerson and Edison and went on to become one of the market leaders in the ceramic tile industry, even shipping a portion of its products to the US and Hong Kong.

At end-2000, the company‘s top stockholders are Siam Cement Public Co. Ltd. of Thailand (40 percent); Go Soc & Sons & Sy Gui Hat Inc. (18 percent); Edison Coseteng (13.8 percent); Mariwasa Holdings (eight percent); Prima Mercantile (five percent); and Rey Marketing (four percent).

Since 1998, the company has been losing, posting a net less of P241.17 million last year, much higher than the P180-million losses in 1999 and 1998.

Although Mariwasa posted sales growth of eight percent last year to P1.4 billion, it blamed rising costs, the continuing depreciation of the peso, write down of inventories and lower selling prices for its losses.

This despite an early financial and operational restructuring started in 1998 to prepare the company for expansion and to widen its business for export.

Among these measures were the completion of its restructuring plan with the entry of $3 million subordinated loan and 1.3 billion in Japanese yen senior loan; the tightening of its credit control to avert potential bad debts; and productivity and cost-cutting measures.

Aside from Mariwasa, other majority tile producers in the country include Guoco Ceramics, Fil-Hispano, Pioneer Ceramics and Eurotiles.