Acquisitions trim Phoenix Petroleum’s 9-month profit

MANILA, Philippines — Net earnings of independent oil firm Phoenix Petroleum Philippines Inc. slipped by eight percent in the first nine months on the back of higher expenses due to acquisitions.

Based on its latest financial report, Phoenix said its net income amounted to P1.32 billion in January to September compared to P1.44 billion in the same period last year.

The decline was attributed to the company’s non-recurring transactions, principally as a result of acquisitions.

Acquisitions include investments in Pos!ble.net, a digital payment platform, last May to support its business operations aside from synergies on its retail network development for its various fuel products, as well as its subsidiaries and affiliates such as the business operations of Philippine FamilyMart.

It was also in January this year that Phoenix signed a deed of absolute sale and concluded the acquisition of the Philippine FamilyMart CVS Inc. (PFM), which is engaged in operating convenience stores under the trademark “Family Mart.”

In the same month, the oil firm also entered into a joint venture agreement with TIPCO Asphalt Public Company Limited (TIPCO Asphalt) and Carlito Castrillo to set-up PhilAsphalt (Dev’t) Corp., which operate, market and distribute bitumen and bitumen-related products in the Philippines.

Excluding one-off items related to the acquisitions, recurring income rose 23 percent on to P1.41 billion.

The oil firm’s revenue almost doubled from P32.57 billion to P64.96 billion as volume of petroleum products sold grew 51 percent year-on-year to a record-high of 2.02 billion liters along with the rise in benchmark crude as well as the imposition of the new excise tax rates at the start of the year.

The domestic business increased volume by 12 percent driven by fuels and liquefied petroleum gas (LPG), which rose by 11 percent and 23 percent, respectively.

Augmenting its sales volume was the start of trading operations at PNX Petroleum Singapore Pte Ltd. which added more than 500 million liters.

Meanwhile, its convenience store retailing business has grown average daily sales by 21 percent driven by the launch of the Generation 2 store concept, which is food service-centric and features a bigger dining area and wider selection of food offerings.

Current store count is at 71 with six new stores opened since January. Of the new stores, four are on board Starlite Ferries vessels, including a full store in Starlite’s MV Salve Regina that services the Batangas-Caticlan route.

Soon, FamilyMart will be in Phoenix stations with five stores expected to be opened by yearend. Its retail network counts 558 stations nationwide.

“In this highly dynamic operating environment, we continue to recognize opportunities. We are broadening our products and services – fuels, LPG, convenience stores, payments, and soon, asphalt – developing credible and compelling offers that create value for our consumers, partners, and shareholders,” Phoenix chief operating officer Henry Albert Fadullon said.