Phoenix income down 96% in 2020, but only “Big 3” firm to post profit

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While the Philippines’ two largest oil firms have been slapped with huge losses in 2020 due to the COVID-19 pandemic, Phoenix Petroleum — the country’s third-largest player — managed to post a net income of Php63 million, or around 96% less than the Php1.49 billion profit registered in 2019.

The Dennis Uy-led oil firm, which reported a Php95 million loss in the first three quarters, rebounded in the fourth quarter with a Php158 million net income as oil prices picked up along with the loosening of quarantine restrictions.

Petron — the country’s largest oil firm — posted a net loss of Php11.4 billion last year, while its closest rival Shell recorded a loss of Php16.2 billion.

As a whole, Phoenix was still able to post profits with its overseas volume more than doubling for the whole year. The Davao-based firm said PNX Petroleum Singapore was able to expand its external fuels  and liquefied petroleum gas (LPG) sales during the year, leveraging on the scale of its domestic operations. Meanwhile, Phoenix Gas Vietnam’s LPG volume almost tripled.

Domestic volume, on the other hand, declined by 20% for the year. Phoenix said this should have been greater if not for the 32% rebound in the final quarter on the back a 32% year-on-year increase in LPG sales in Luzon.

Momentum has likewise picked up in the commercial and other business-to-business sectors, specifically power, manufacturing, and pandemic-resilient industries like fishing, leading to a 51% quarter-on-quarter volume growth in the last three months of the year.

“We have accelerated our structural transformation, reducing OPEX (operating expenses) per liter by 32%. We delivered on our commitments and cut OPEX and CAPEX (capital expenditures) similarly. We expect to continue to benefit from these operational improvements over time,” Phoenix President and CEO Henry Albert Fadullon said in a statement.

Fadullon added that Phoenix is executing and has made progress with its balance sheet programs, such as improved liquidity position though not yet back to optimal levels, long term-refinancing of short term loans, which lengthened maturity profile, and its Php4.25 billion refinancing program.

“It was a strong finish to a challenging year. For this year, while vaccine developments are encouraging, the resurgence of the virus and the new rounds of lockdown may continue to dampen overall consumer confidence and industrial and commercial activities. Nevertheless, our desire for growth has not been diminished and we will accelerate it by sweating our existing assets and keeping our sharp focus on cost discipline,” Fadullon added.

Uy earlier was reportedly “open” to selling either a part or a controlling stake in Phoenix. The company later said that it was not for sale, though investors would be welcome to help manage its debts.