Eagle Cement optimistic on overcoming COVID-19 crisis with strong balance sheet

Ang family-led Eagle Cement Corp. is optimistic that it has the financial muscle to overcome the adverse impact of the COVID-19 pandemic on the economy.

“Our strong financial position will allow us to weather this health crisis battering the economy without giving up major components of our expansion plans, which will secure our future growth,” Eagle Cement president & CEO Paul Ang said in a statement.

In the first quarter of 2020, the cement maker saw its assets grow by 2% to P49.9 billion from P49.1 billion as of end-2019 while total liabilities declined to P11.4 billion from P11.7 billion.

The company’s stockholders’ equity rose by 3% to P38.5 billion.

However, Eagle Cement’s net profit declined to P1.2 billion from P1.6 billion a year earlier, reflecting the impact of the imposition of the enhanced community quarantine (ECQ) in Luzon due to COVID-19 pandemic, which offset its robust performance at the start of the year.

Prior to the lockdown, the company’s sales trend has showed that Eagle Cement could have outperformed last year’s first quarter results.

In 2019, the company delivered double-digit growth across the board, with net sales and net income growing by 20% and 25%, respectively.

Ang noted that while spending for noncritical projects and activities will be trimmed in view of the economic slowdown, expansion-related capital expenditures will continue.

Eagle Cement has earmarked P1.5 billion capital expenditure for the construction of its fifth cement mill in its manufacturing plant in San Ildefonso, Bulacan.

The new mill will add 1.5 million metric tons of cement output, pushing Eagle Cement’s annual cement capacity to 8.6 million metric tons by the end of the year.

Ang added there are good signs construction activity will rebound in the second half of 2020 as community quarantines imposed to control the spread of COVID-19 have eased.

“In line with the government’s call to prioritize critical infrastructure projects that will help restart the economy, we have ramped up our production since we resumed commercial operations last month. Eagle is fully prepared to supply the steadily increasing demand for cement as more and more construction projects both in the public and private sectors open up,” he said.

The company is also taking steps towards digital transformation.

The firm said it has engaged an international provider of enterprise resource planning (ERP) system that is tailored fit for its cement manufacturing business.

The new ERP system will enhance customer experience through an online customer portal, which provides features such as booking, tracking and arrival of orders, according to Eagle Cement. --KBK, GMA News