Phoenix Petroleum Philippines Inc. has sold its stake in shipping and industrial business to lower its debt expenses.
In a disclosure to the Philippine Stock Exchange, the company said it divested its stake in Chelsea Shipping Corp. (CSC) to affiliate Chelsea Shipping Group Corp. for P2 billion.
It also sold its full interest in Phoenix Petroterminals & Industrial Park Corp. to Udenna Development Corp. (UDEVCO) for P1 billion.
The sale of Chelsea Shipping will save the Phoenix around P150 – P160 million annually in interest expenses.
The sales will be used to pay off the company’s debts, and allow Phoenix Petroleum to focus on the expansion of its core business and distribution of petroleum products nationwide.
“On the matter of the financial condition of Phoenix, the disposition will relieve as it will free up the consolidated debt to equity ratio of the Company. Moreover, the proceeds will enable the company to pay off its existing interest bearing debts and thus improve its financial statements,” Phoenix said.
The firm added that the shipping and industrial businesses are independent from its petroleum business, and does not affect this part of their business.
The company registered a P1.09 billion income last year, up from 2015’s P905.87 million after hitting all-time high sales volume of 1.5 billion liters.