Independent oil player Phoenix Petroleum said Wednesday that its performance
in April and May indicates “positive results” for the company, an improvement from the net loss it incurred in the first three months of the year.
“Compared to what has been reported by the industry, we generated an operating income and a positive EBITDA [earnings before interest, taxes, depreciation and amortization]. Further, we are encouraged by positive results in April and May enough to suggest worst is behind us,” said Albert Fadullon, newly installed company president.
Despite the severe challenges faced by countries grappling with the Covid-19 pandemic in the first quarter, Phoenix Petroleum said it is the only energy company that remained relatively unscathed compared with other publicly-listed oil companies.
The leading independent biggest oil player registered a gross profit of P1.7 billion in the first quarter on the back of revenues of P21.9 billion, leading to an EBITDA of P503 million during the period.
He also said the petroleum industry is facing challenges due to geopolitical tensions and these are compounded by the pandemic which began to have an impact on demand towards March. However, Phoenix said it has remained resilient compared with other major players.
“Definitely Phoenix has not been spared from the challenges, but we are able navigate the downturn better due to our earlier investments in strategic, higher-margin and diversified businesses areas such as retail and liquified petroleum gas (LPG),” said Fadullon.
LPG volume surged by 39 percent with consistent double-digit growth in its core market in Visayas and Mindanao coupled with sustained expansion in Luzon. Fuel retail volume was also higher by 9% on the back of its network expansion in 2019. As of end-March, 660 stations have been opened nationwide.
“In response to the ongoing Covid-19 public health crisis, we have identified three key strategies—keeping people safe, maintaining business-as-usual operations and preserving resources,” he said.
Phoenix is among the first companies to announce continued work-from-home arrangements for majority of its workforce, up until the end of the year. Operational staff are scheduled on a bi-weekly rotation and financial assistance has been extended to its employees. To date, no Covid-positive cases have been reported within the company.
In terms of operations, Phoenix’s supply chain remains 100 percent online with 95 percent of its retail sites and LPG outlets open to serve customers. Around 60 percent of its FamilyMart retail convenience stores remain operational. The company is continuously pursuing e-commerce platforms to enable cashless transactions across and widen the reach of its retail businesses.
In its drive to preserving resources, Phoenix said it promptly adjusted to demand changes by keeping inventory levels to 50 percent of terminal capacity, which reduced the burden on working capital. Cash requirements were reduced by at least P2.3 billion this year compared to original plans. Of this amount, P1.5 billion is from capital expenditure reduction and P800 million has been saved from marketing, advertising, and travel as resources shift from traditional to digital channels.
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