Phoenix Petroleum renews commercial paper

Phoenix Petroleum Philippines, Inc. has renewed its 3.5-billion commercial paper issuance for which it has been given the second highest issuer credit rating of PRS Aa minus (corp.) by Philippine Rating Services Corporation (PhilRatings).

PhilRatings explained that a company rated PRS Aa has a strong capacity to meet its financial commitments relative to that of other Philippine corporates.

An Issuer Credit Rating is a measure of a company’s over-all creditworthiness, relative to obligations maturing within one year.

Phoenix Petroleum is the biggest independent oil player in the country with 443 retail stations as of end-June, 2015. Its aggressive network expansion allowed the Company to enjoy a 4.1 percent share of the total market as of end 2014.

While revenues have declined due to the downward movement in oil prices, Phoenix Petroleum’s net profit margins have improved given the company’s greater focus on its retail sales.

From a net profit margin of 1.53 percent in 2013, this improved to 1.77 percent in 2014, and further to 2.95 percent for the period ended June, 2015.

For the first six months of 2015, cash balance was supported by an increase in borrowings. Ending cash balance as of end-June 2015 was at 823.3 million, higher by 9 percent compared to that for end-June, 2014.

Current ratio was at a comfortable level at 1.13x as of June 30, 2015.

“Phoenix also has a significant amount of undrawn credit lines from various local and multinational financial institutions in the country which adds to its financial flexibility,” PhilRatings noted.

This, together with the company’s improving level of cash flows from operations, puts Phoenix in a better position to support its operations and to compete effectively.