Phinma unit Philcement takes out P1-B loan for expansion
A SUBSIDIARY of Phinma Corp. availed of a P1-billion term loan for the expansion of its cement facility to be taken from the proceeds of the parent company’s bond issuance.
Philcement Corp., a 60%-owned unit of Phinma, availed of the loan on Sept. 16 for 1.5 years at the current market rate, the listed firm said in a disclosure to the stock exchange on Monday.
Phinma said that its board of directors approved the loan as part of a plan to support the growth of its strategic business units, which include investment holdings, property development, construction materials, educational services, and business process outsourcing.
The loan proceeds will be used by Philcement to fund the expansion and improvement of its facility in Mariveles, Bataan.
“This is aligned with [Philcement’s] promise to assure Filipino consumers with reliable, high-quality supply of cement products under its legacy brand, Union Cement,” the company said.
On May 6, 2021, Phinma filed with the Securities and Exchange Commission the registration statement of its proposed offering of P2-billion fixed rate bonds due 2024.
It had an oversubscription option of up to P1 billion and had an offer price of 100% of face value, as stated in the company’s information statement.
The company was issued the certificate of permit to offer securities for sale on Aug. 10, 2021. The bonds’ interest rate was set at 3.53%.
Philcement is one of the companies under Phinma’s construction materials group along with Union Galvasteel Corp. and Phinma Solar Corp.
In the first half, the construction material group posted a 13% increase in consolidated revenues to P7.07 billion.
However, the group’s net income declined 19.7% to P443.28 million from P551.89 million last year, which the company attributed to higher costs amid global supply chain issues.
Phinma’s topline jumped by 10.1% to P8.63 billion in the first semester from P7.84 billion in the same period a year ago.
Meanwhile, its attributable net income declined by 7.4% in the first half to P406.83 million from P439.34 million in the same period last year.
On Monday, shares in Phinma closed higher by 25 centavos or 1.22% to P20.75 apiece. — Justine Irish D. Tabile