Petron bags SEC's nod for P50-B bond sale

MANILA, Philippines – The Securities and Exchange Commission greenlit Petron Corp’s planned sale of fixed-rate, peso-denominated bonds that will fund the oil company’s debt payments and power plant project.

In a statement on Friday, corporate regulators said they approved Petron’s P50-billion bond program that the company may issue in one or more tranches within three years.

For the first tranche, Petron will sell up to P18 billion worth of four-year Series E bonds due in 2025 and six-year bonds due in 2027. The company hopes to bag P17.78 billion in proceeds from this offer.

Funds that will be raised will be used for the redemption of Petron’s Series A bonds, partial financing of its power plant project, and payment of old debts.

Based on Petron’s timetable, the initial tranche of the bonds will be offered from September 27 to October 5. A week later, the bonds will be listed on the the Philippine Dealing & Exchange Corp. on October 12.

The oil giant’s operations have been feeling the crushing weight of the pandemic. In 2020, Petron reported a net loss of P11.4 billion, a turnaround from the preceding year’s P2.3 billion net income, after pandemic restrictions pushed down oil prices amid weak demand from locked-down consumers.

Earnings have since recovered amid rallying oil prices as curbs were eased. In the first half, Petron swung back to profits to post a consolidated net income of P3.87 billion, but overall sales volume was 7% lower year-on-year "as the market continues to reel from the impact of the pandemic".

Shares in Petron closed flat at P3.07 each on Friday.