Davao-based Phoenix Petroleum Philippines Inc. plans to spend P10 billion over the next three years for expansion, including possible acquisitions of other companies, a top executive said.
Phoenix Petroleum allocated a P2-billion budget for capital expenditures this year as it continues to increase its retail network, storage and logistic capacities.
“We plan to spend P6 [billion] to P8 billion more over the next three years as we look to expand through acquisitions,” Phoenix Petroleum president Dennis Uy said in a statement.
The company earlier announced plans to open new depots in Tayud (Cebu) and General Santos in the first and fourth quarters, respectively.
An expansion is also plans for the Calaca (Batangas) terminal in the third quarter.
The company reported earnings of P1.09 billion in 2016, or 21 percent higher than P905-million net income generated in 2015.
Core earnings from the fuel business more than doubled to P937 million from P416 million in 2015, due to better margins and sales mix.
Phoenix Petroleum said sales volume reached 1.5 billion last year, up 25 percent from 2015, driven by solid growth in retail and commercial volume.
Lubricant sales volume saw an 18-percent growth year-on-year on increased market share.
Retail sales volume increased 12 percent year-on-year, with the completion of 51 new retail stations in 2016, bringing the total number of outlets to 505 as of end-December 2016.
Same-store sales growth remained strong at 18 percent on higher consumption, supported by brand-enhancing investments in marketing and advertising.
Commercial sales volume grew 33 percent, from higher market share and increased consumption by distributors and corporate direct accounts, which included the power, transport, construction and aviation sectors.
Revenues rose 2 percent on higher sales volume, trimmed by lower oil prices.
The company last year concluded its sale of its non-core businesses in shipping and industrial park operations to the Udenna Group, the effective parent and majority stockholder of the company, for total net proceeds of P3 billion.
“Proceeds of the sale were used to pay down debt, which improved the company’s leverage, allowing room for further investments in its core business, including potential acquisitions,” it said.