PHOENIX Petroleum Philippines, Inc. said net profit attributable to the parent firm fell 8.4% in the second quarter to P486.24 million, according to its quarterly financial report, in part as cost and expenses as well as other charges rose during the period.

“Against a backdrop of challenging operating conditions, we continue to invest and build on our long-term competitive advantages. We are building scale to drive efficiency in fuels and LPG. We are investing in the brand and more importantly, in capabilities that will allow ourselves to adapt and innovate in markets,” Henry Albert R. Fadullon, Phoenix Petroleum chief operating officer, said in a statement.

Revenue during the quarter hit P27.11 billion, up 22.3%, a growth rate outpaced by the 22.5% rise in cost and expenses to P26.06 billion. Other charges also increased significantly by 78.7% to P524.71 million.

In the first half, Phoenix Petroleum announced a 7.5% drop in net profit to P896.83 million despite a 27.2% year-on-year increase in revenue to P51.20 billion.

Operating income increased by 22% to P2.07 billion, fueled by retail growth and new businesses such as liquefied petroleum gas (LPG) and PNX Petroleum Singapore Pte. Ltd.

Phoenix Petroleum said its Singapore business, which derived 39% of its volume from third-party customers, grew its volume by 89%. It said the unit since starting its operations in November 2017 has improved inventory cost management and enhanced efficiency as it leveraged the scale of the consolidated volume of the domestic business, and local and overseas external customers.

“Phoenix Petroleum continued to deliver on its strategic priorities, growing retail volume by 17% in the first half of 2019 behind the continued network expansion and improved operating efficiencies. A total of 630 stations have been opened nationwide as of June 2019,” the company said.

“The non-fuel retail business increased revenues by 5% as total chain sales of FamilyMart grew 5% year-on-year. FamilyMart added five stores and had 76 stores as of end June. Its focus on food sales and expense discipline continues to improve profitability,” it added.

In the LPG business, the first-half volume increased by 24% year-on-year with strong operations in Visayas and Mindanao, and the expansion in Luzon.

“VisMin volume grew 16% in the first half and accounted for 87% of volume. Luzon volume increased 85% and contributed 13% to the total volume versus 4% prior to the acquisition and operation by Phoenix,” the company said.

On Friday, shares in the company fell 3.48% to close at P11.10. — Victor V. Saulon