Petron profit falls 70% to P3.6 billion in 9 months

MANILA,Philippines — Petron Corp. continued to post lower earnings as of the end of September due to low refining margins amid worsening oil smuggling in the country.

In a statement, Petron said it booked a net income of P3.6 billion from January to September, down 70 percent from the same period last year due to the prolonged depressed refining margins in the region and the shutdown of its refinery.

Most of the income came from Petron Malaysia’s contributions and the extensive efforts to manage costs and keep the business at home viable under the current volatile market conditions.

Consolidated revenues went down nine percent to P381.7 billion as Philippine volumes fell by seven percent as a result of the Bataan refinery’s emergency shutdown in April.

The Bataan refinery, which has a capacity of 180,000 barrels per day, resumed normal operations in early August.

Petron said global oil prices also remained volatile and lower compared to last year because of ongoing trade wars.

Despite lower Philippine volumes, the oil firm’s stations within the freeport zones performed better than last year.

Under the current regime, service stations within freeport zones like Clark and Subic do not pay local and national taxes, including excise taxes.

Inside the Clark Freeport Zone, Petron retail volume registered a 54 percent increase over the same period a year ago.

“This level playing field is what we hope will prevail in the entire country once the fuel marking program is in place. We fully support and look forward to its implementation but at the same time, we reiterate that this mechanism will only work if all players go by the same rules,” Petron president and chief executive officer Ramon Ang said.

“Oil smuggling has worsened in recent years and it’s not only us in the industry but also the government and the entire nation that suffer because of it,” he said.

This year, Petron opened over 100 new stations in the Philippines, and 38 new stations in Malaysia. In the Philippines alone, the company has over 2,400 stations, still the largest network of service stations in the country.