MANILA, Philippines — Listed sugar and bio-energy company Roxas Holdings Inc. (RHI) expects its bottom line to remain flat as it sees lower sugar production this year.
RHI president and chief executive officer Hubert Tubio said the company is looking at a nine percent decline in its milled sugarcanes to 3.1 million metric tons (MT). This is also equivalent to about 5.7 million 50-kg bags of sugar.
“There will be reduction since this is a national phenomenon. Nationwide, it (sugar production) is expected to decrease by 10 percent, some are even looking at 15 percent,” Tubio told reporters on the sidelines of the company’s annual stockholders meeting Wednesday.
National raw-sugar production continues to decline as it reached 1.45 million MT as of mid-March, down nine percent year-on-year.
“This is also mostly because of the weather and delay in replanting activities last year,” he added.
Globally, there is also a downtrend in the sugar industry driven by the large surplus coming from India and Thailand.
RHI earned P120 million last year. It expects profits to stay the same level as improving sugar prices are seen to offset the decline in production.
From P1,250 at the start of the milling season, prices have inched up to P1,650 per bag,” Tubio said.
For this year, RHI trimmed its capital expenditures to P600 million from P1.2 billion. Of the amount, P400 million has been allocated for its sugar business while the remaining P200 million will go to the alcohol business.
RHI is the largest integrated sugar business in the Philippines which manages 100 percent of Central Azucarera Don Pedro in Batangas, and Central Azucarera de la Carlota Inc.