Philippine Daily Inquirer (PDI) reported on 24 April 2011 that Holcim Philippines (HLCM) is planning to invest around US$500 million in a new local cement factory.

According to HLCM’s Chief Operating Officer (COO), the company would either activate their idle plants or build an entirely new cement production line in anticipation of the spike in demand for the coming years.

Public-Private Partnership (PPP) projects, mostly for major infrastructures, as well as private construction activities are expected to be the drivers of demand for cement and other construction materials.

The COO, however, in a report by BusinessMirror on 24 April 2011, said that the company believes that “the PPP projects will not have a tremendous impact in 2011. In the optimistic scenario, we will see its impact in 2012 fully. In the realistic scenario, it will start in 2012.”

In the same report, Holcim’s Commercial Director said that it continues to monitor rising coal and fuel prices which account for roughly 40% of variable cost (since cement production involves various equipments and huge machines which require a lot of energy/power).

In a related report published in Business World on 24 April 2011, Holcim’s COO said that the company currently has 33% market share.

In a disclosure to the stock exchange, HLCM confirmed reports that it will increase capital spending (i.e. amount to be spent on factories, equipments) from Php800 million in 2010 to Php1 billion in 2011.

Read Full Post »