Petron profit slides 26% to P3.2 B on lower crude prices

MANILA, Philippines - Petron Corp., the country’s biggest oil refiner, reported a consolidated net income of P3.2 billion in the first nine months of the year, down 26 percent from the previous year’s P4.4 billion due to the sustained fall in crude prices even as consolidated revenues remained strong.

The benchmark Dubai crude fell to an average $97 per barrel in September from an average $108 per barrel in June, resulting in nine rounds of price rollbacks during the period.

“If the crude price was stable in the third quarter, operating income would have been higher by P1.9 billion,” Petron said.

However, sales remained strong, churning in consolidated revenues from both its Philippine and Malaysian operations of P335.9 billion over the same period last year from P379.5 billion a year ago, an increase of 13 percent.

“We are operating in two of the fastest rising economies in Asia and we are well-positioned to participate in this growth and further expand our business,” Petron chairman and CEO Ramon Ang said.

Combined sales volumes increased 7.3 percent, reaching 64.7 million barrels over the period with growth seen across all major trades namely retail, industrial, and LPG in both markets driven by strong domestic consumption and increased economic activity.

Domestic sales volumes for both Philippine and Malaysia markets grew six percent and five percent, respectively.

Here in its home market, volumes surged 11 percent to 38.3 million barrels, further cementing its leadership position, Petron said, adding that its overall  market share stood at 37 percent in the first half of the year.

In September 2014, Petron announced the start-up of its $2-billion Refinery Master Plan Phase 2 (RMP-2) which would allow it to fully utilize its 180,000 barrels-per-day capacity and significantly increase the production of high-margin products such as gasoline and petrochemicals to fuel the growing Philippine economy.

“RMP-2 will unlock the full potential of our biggest asset and result in a stronger Petron since it will increase revenues, boost production, and enhance our refining margins,” Ang said.

“But more importantly, it gives us the ability to support the Philippine economy and its growing demand for fuels,” he added.

For the Malaysian market, Petron said it is also expanding its retail network with the construction of several new stations. 

It has a target to build around 30 stations this year after constructing new facilities at the Pasir Gudang Terminal and the Westport Terminal aimed at improving operational efficiencies.