Fuel and power costs wreak havoc on Cemex Holdings’ Q1 profits

Cemex Holdings, a leading cement producer in the Philippines, swung to a net loss of P355 million in the first quarter from the P261 million profit reported during the same period last year.

The company cites the combination of higher fuel and power costs and lower cement demand as the primary drivers of this disappointing result.

Net sales were down by 11 percent to P4.6 billion, mainly due to lower volumes

The drop in cement demand led to a 16 percent year-on-year decrease in domestic cement volumes.

Cemex is expecting a low-single-digit percentage decrease for its domestic cement sales volume this year.

Furthermore, cost of sales as a percentage of net sales rose by 17.7 percentage points year-on-year due to higher fuel and power costs.

Despite noticing an inflection point in costs, Cemex president and CEO Luis Franco anticipates that market conditions and cost inflation will remain challenging through the first half of 2023.

Franco believes that 2023 will be a year of transition for Cemex.

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