The possibility of industry consolidation does not faze the country’s largest integrated sugarbusiness, Roxas Holdings, Inc. (PSEi: ROX). 

 

At the sidelines of RHI’s Annual Stockholders’ Meeting, RHI Chairman Pedro E. Roxas said the sugar group is aware of the implications of the coming tariff reduction on sugar to 5% in

2015 from 48% in 2010 under the ASEAN Free Trade Agreement (AFTA) and has prepared for the coming challenge. 

 

“We felt the pressure and continue to feel the implications of the impending threats and challenges of 2015 — all the more made real by the fact that we only have a window of less than 12 months to implement the necessary action plans. These, more than anything, drive the point that we cannot afford to be complacent,” Mr. Roxas explained. 

 

He added: “RHI has prepared for 2015, recognising it as an opportunity to showcase our strength as a global Filipino company. We took stock of our capabilities, strengthened our competencies, widened our networks, scouted for opportunities that will solidify Roxas

Holdings’ sweet position — not only in the Philippines but also outside Asia, and made aggressive but calculated decisions while we continue to nurture relationships.” 

RHI President & CEO Renato C. Valencia said the Group is preparing for the ASEAN integration and its challenges. 

 

“With our turnaround in 2012, we continued to put in the discipline and the needed measures to continue the momentum and be prepared for industry challenges, particularly the impact of the reduction of tariff on sugar,” Mr. Valencia noted, adding that “the ASEAN integration will precipitate industry consolidation as smaller and less efficient mills give way to bigger, more efficient ones with a broader array of products”. 

 

The PCEO further noted: “We are building our financial resources for the coming industry consolidation, always on the lookout for strategic merger, acquisition and collaboration that will make RHI even stronger and more viable in the future.” The initiatives include establishing co-generation facilities beside the Group’s plants in Batangas and Negros Occidental; setting up a research and development facility in partnership with universities and providing nursery and extension services to planters; upgrading of facilities and systems; enhancing brand equity; focusing more on cost effectiveness and diversification; leveraging on technical management expertise; installing Risk Management system; and strengthening corporate social responsibility.