Phoenix Petroleum posts 7% profit drop

Phoenix Petroleum Philippines Inc. said it would continue to leverage on its Singapore trading platform to boost its operations after posting a seven percent drop in its first half net earnings.

The company posted net earnings of P896.83 million from January to June, down from P971.5 million amid a challenging environment for the local oil sector.

This as the local oil industry continued to suffer at the start of the year with the second phase of the Tax Reform for Acceleration and Inclusion (TRAIN) Act, which brought further increases in excise taxes, coupled with a higher product cost environment.

“Against a backdrop of challenging operating conditions, we continue to invest and build on our long term competitive advantages,” Phoenix Petroleum chief operating officer Henry Albert Fadullon said in a statement.

In the first semester, the oil firm increased its operating income by 22 percent yearon-year to P2.07 billion fueled by retail growth and new businesses such as LPG and Phoenix Petroleum Singapore (PNX SG).

Revenues increased by 27 percent to P51.2 billion as overall volume grew by 28 percent.

PNX SG, which derived 39 percent of its volume from third party customers, grew volume by 89 percent. Since commencing operations in November 2017, PNX SG has improved inventory cost management and enhanced efficiency as it leveraged on the scale of the consolidated volume of Phoenix’s domestic business and local and overseas external customers.

Meanwhile, Phoenix said it continued to deliver on its strategic priorities, growing retail volume by 17 percent behind the continued network expansion and improved operating efficiencies.

As of the end of June, the oil firm opened a total of 630 stations nationwide.

Its liquefied petroleum gas (LPG) business saw a 24 percent jump in volume on the back of strong Visayas-Mindanao operations and expansion in Luzon.

VisMin volume grew 16 percent in the first half and accounted for 87 percent of volume while Luzon volume increased 85 percent and contributed 13 percent to the total volume versus four percent prior to the acquisition and operation by Phoenix.

Meanwhile, the non-fuel retail business increased revenues by five percent as total chain sales of FamilyMart grew five percent.

FamilyMart added five stores and has 76 stores as of the end of June.

Moving forward, Phoenix Petroleum said it expects to further leverage PNX SG’s scale and trading capability through its LPG trading desk that will serve not only Phoenix’s domestic and Vietnam LPG volume, but also other external customers in the region.