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Freeman Cebu Business

Pilipinas Shell targets to double non-fuel retail segment by 2025

Ehda M. Dagooc - The Freeman

CEBU, Philippines —  Pilipinas Shell Petroleum Corporation is poised to expand its Non-Fuel Retail (NFR) through its Mobility business and targets to double the segment by 2025—engaging in retail trade.

Shell’s NFR segment has steadily grown through the years and was quick to recover from the pandemic.

According to Pilipinas Shell President and CEO Lorelie Quiambao-Osial, subject  to the approval of the shareholders of Pilipinas Shell and the Securities and Exchange Commission, the company will own and manage stocks for sale directly to the general public.

She said this new model will be rolled out in Pilipinas Shell’s 520 company-owned Select stores in the country, with the pilot slated for 2023 and full launch scheduled for 2024.

Meanwhile, Pilipinas Shell Petroleum Corporation ended the first half of 2022 with a net income of Php7.8 billion, enabling the Company to declare dividend of Php1/share payable this September, delivering an industry- leading 5.6 percent dividend yield.

“Through the disciplined and resilient implementation of our strategy, we have recovered from the deficit in retained earnings in the past two years and are now able to deliver dividends to our shareholders. This reflects our strong culture of sustained performance even in the midst of a prolonged volatile business environment. We are confident to continue our momentum, deliver shareholder returns, and power progress for the Philippines,” said Quiambao-Osial.

Global product prices reached historical highs this year versus the start of the year – that caused a rise in working capital requirements. Despite this, Pilipinas Shell’s strong fiscal management allowed the Company to maintain a controlled level of borrowings. Excluding movement in working capital, the Company ended with a positive cash flow from operations of Php13.7 billion - an upside from previous year’s Php7.6 billion.

Pilipinas Shell has helped its B2B customers increase their operational efficiencies through the company’s technical services and the first carbon offsetting program in the country, and made consumer travel more enjoyable with convenience offers, designing its mobility sites to be more than just stopovers but points of destination.

“We are on the cusp of a revolution in energy with the launch of the first of a series of EV charging stations, with more mobility sites using solar power, and we are prepared to bring our global technology expertise on other offerings, should the market need arise,” she explained.

Quiambao-Osial added that Shell is more than just a fuels and lubricants business, “as we continue to adapt to changing customer and stakeholder needs, so must our corporate name. We are now Shell Pilipinas Corporation, ready to meet the energy challenge and embrace opportunities in decades to come. The change in name has the approval of our Board of Directors, pending that of regulatory bodies.”

Shell V-Power remains the most preferred fuel brand in the country. Targeted customer-centric offers tempered the demand volatility brought by the fuel price hikes in the quarter.

B2B volume increased across all sectors in 1H22. Aviation sales continue to improve with 49 percent increase vs PY - driven by the continued increase in travel and opening of international and domestic borders.

Commercial Fuels increased volume sales by five percent with the sustained reliable supply of fuels for sector customers, as well as spot sales in Power, and other Fuel Oil customers.

Lubricants saw a five percent volume increase while increasing premium sales volume two-fold across product categories. Construction and Road on the other hand grew by eight percent primarily through its premium products.

PILIPINAS SHELL PETROLEUM CORPORATION

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