Tuesday, August 25, 2009 | MANILA, PHILIPPINES [ BusinessWorld Online ]
THE LOCAL arm of cigarette maker Philip Morris International has leased more property at the Subic Freeport to accommodate a new P1-billion tobacco leaf warehouse, the Subic Bay Metropolitan Authority (SBMA) said in a statement yesterday.
Philip Morris Philippines Manufacturing, Inc. is said to be pushing through with plans to quadruple its current storage capacity to 24,000 tons with cigarette manufacturing operations in Batangas still profitable despite the economic slowdown, the government agency said.
A spokesman for Philip Morris Philippines Manufacturing, Inc. confirmed this, adding that the firm plans to begin construction as scheduled in mid-September after a contractor is chosen.
Philip Morris signed a 50-year lease agreement with the free port authority last week, increasing its total land area to 49,279 square meters from its current 9,600-square-meter warehouse, the SBMA said.
The new climate-controlled warehouse will hold leaves for processing in the firm’s Philippine, Malaysian, and Indonesian factories.
The expansion comes with Philip Morris having "posted growth during the global economic slowdown," the free port operator said.
Financial statements filed with the Securities and Exchange Commission show that the firm’s sales grew 8.2% to P32.717 billion in 2008, with income likewise rising by 14.6% to P2.083 billion.
Assets stood at P18.895 billion while liabilities amounted to P3.691 billion, both up by roughly 15% from year-ago levels.
The firm’s communications manager, Dave M. Gomez, said in a telephone interview that bidding for the construction is ongoing, with awarding slated for Sept. 4 in time for groundbreaking within Sept. 14-18.
SBMA officials said Philip Morris’s expansion emphasizes the free port’s "ability to become a logistics hub for Southeast Asia."
Early this year, Federal Express or FedEx shut down its regional hub in Subic, transferring to a bigger location in China. — Jessica Anne D. Hermosa