Roxas Holdings Inc., a sugar company now controlled by First Pacific Company Ltd., said it incurred a net loss of P125 million in October to December, representing the first quarter of its fiscal year.
The sugar company said the net loss was a turnaround from the P9-million net income it booked in the same period in 2014, amid operational challenges affecting two manufacturing plants.
Roxas Holdings chairman Pedro Roxas said the company reeled from the combined impact of insufficient cane supply, late startup of its Batangas plant and temporary shutdown of a newly acquired plant.
First-quarter operating revenues surged 130 percent to P2.7 billion from P1.17 billion recorded in the same period. However, operating expenses also accelerated 160 percent P2.59 billion from only P998 million booked in the same period a year ago.
Roxas Holdings president and chief executive Hubert Tubio said the combined gross profit of Central Azucarera de la Carlota Inc. and Roxol Bioenergy Corp.both in La Carlota City in Negros Oriental was not sufficient to carry the group’s total expenses for the period.
San Carlos Bioenergy Corp., an ethanol firm which the group acquired in May last year, had to temporarily cease operations to give way for enhancement initiatives to improve plant efficiencies.
Tubio said the first-quarter’s net loss was only a temporary setback and the company was expected to improve its performance by yearend.
“We hope to see an improvement in our full-year core net income,” Tubio said.
Roxas Holdings also earmarked P1.4 billion in capital expenditures this year primarily to address operational challenges.
Roxas Holdings’ board of directors, in a recent meeting, approved a rights offering of common shares to be offered to the common shareholders of the company.
The final terms and conditions of the stock rights offering will be announced, once these are finalized.
First Pacific, through subsidiary First Agri Holdings Corp., acquired 241,780 million treasury shares of Roxas Holdings in February 2015 for P1.7 billion, resulting in an increase in effective interest to 51 percent from 34 percent.
As a result, First Pacific became the majority shareholder of Roxas Holdings.
Roxas group retained a 31-percent interest in the company.