Phoenix posts ₧215-M loss in tough Q1

Phoenix Petroleum posted a net loss of P215 million in the first quarter, a reversal from the net income of P415 million it posted in 2019, as revenues dipped by 9 percent.

The company reported an EBITDA of P503 million at end-march this year, from P1.4 billion in the prior year.

The independent oil player said Monday that the first three months of the year was challenging mainly on account of the volatility in oil markets driven by geopolitical tensions and the Covid-19 pandemic.

“We were not spared but we were able to navigate the downturn better because of our earlier investments in strategic, higher margin areas such as retail and LPG [liquefied petroleum gas].

Our portfolio today is more diversified, with LPG particularly thriving in this pandemic. From a nonessential item in the kitchen, LPG became an essential household product, especially during the enhanced community quarantine [ECQ],” said Phoenix Petroleum CEO Dennis Uy.

LPG volume surged 39 percent due to the consistent double-digit growth in its core Visayas-mindanao market and the sustained expansion in Luzon.

Retail volume was higher by 9 percent as Phoenix builds on the progress of its network expansion in 2019. As end-march this year, 660 stations have been opened nationwide.

Commercial sales volume, however, was down 10 percent.

Phoenix said the growth in retail and LPG cushioned the slowdown in the commercial sales segment as a number of customers were affected by the eruption of Taal Volcano in January.

The oil company said it is focusing on keeping people safe, maintaining business-as-usual operations and preserving resources amidst the pandemic.

It has in fact kept inventory levels at 50 percent of terminal capacity, which reduced the burden on working capital. Cash requirements were reduced by at least P2.3 billion this year versus original 2020 plans. Of this amount, P1.5 billion is from capital expenditure reduction and P800 million are savings from marketing, advertising, and travel as resources are shifted from traditional channels to digital.

“We support and admire everyone—from individuals and families to the small businesses and large corporations—who are contributing their efforts and resources in this critical time of need,” said Uy, who added that Phoenix has committed P100 million for Covid-19 relief efforts nationwide.

“While market conditions are tough and uncertainties remain, we are committed to serving our customers, partners, communities, and our country even more than ever.”

The company has also announced that it has a new president.

Former chief operating officer, Henry Albert “Bong” Fadullon, was elected as the company’s new president effective June 1.

He was elected to the position shortly after the Annual Stockholders’ Meeting last May 29 where he was likewise elected as a new member of the Board of Directors for 2020-2021.

Fadullon succeeds Uy, Phoenix founder and former CEO.

Uy will now assume the role of Chairman of the Board of Directors and Chief Strategy Officer who will be actively involved in the company’s long-term strategy and represent the company.

Former Chairman Domingo Uy, meanwhile, remains in the company’s Board of Directors and as Chairman Emeritus.

“I am confident that as the second and new President of Phoenix Petroleum, he [Fadullon] will continue to build the company into a dynamic, world-class brand with a professional and progressive corporate culture and discipline,” said Uy.