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  • Pryce First Quarter Income up 53% Backed By Solid Volume Growth

    Pryce Corporation and its subsidiaries (PPC) capped the first quarter of this year with a 53% year-on-year increase in consolidated net income to Php 196.42 million from last year’s Php 128.16 million.  Largely contributing to this growth is the 23% increase in the liquefied petroleum gas (LPG) sales volumes of its subsidiary’s PryceGas brand LPG from 32,981 metric tons (MT) in the first quarter of 2015 to 40,583 MT in the first quarter of 2016.  

    As a result of the growth in LPG sales volume, PPC saw an 8% year-on-year increase in consolidated revenues from Php1.345 billion in 1Q2015 to Php1.453 billion for the previous quarter. This growth in volume is attributed to the completion of strategic expansion projects during the past year, along with the steep decline in international contract price (CP) of LPG from US$470/MT in December of 2015 to US$376/MT and US$306/MT in January and February of 2016, respectively. LPG sales of subsidiaries accounted for 91% of PPC’s consolidated revenues while industrial gas sales contributed 6.36%.  The remaining 2.6% of revenues were accounted for by real estate sales, hotel operations, and sales of pharmaceutical products.

    Contraction  in  margins  however  resulted  from  the  decline  in  CP,  causing  PPC’s consolidated  gross  profit  margin  to increase  only  slightly  at  25.40%  from  last  year’s 24.75%   despite  the   increased   revenue.   Operating   income  nevertheless   improved 13.31%  to  Php  193.38  million,  while  the  net  income  of  Php  196  million  represents  a 13.52%  return on  sales,  up from  last  year’s  9.52%  showing  an  increased  efficiency  in profit generation.

    While nationwide demand is growing along with the fall in CP, PPC sees its sales volume growth as outpacing the increasing demand.   This appears to be an indication that PPC has an expanding LPG market share over-all, and the Company estimates that its LPG sales during the first quarter now accounts for 13% of the total national demand.  PPC  is  optimistic  that  the  first  quarter results  heralds  the  achievement  of  target projections for the year.

     

     

    May 4, 2016

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