MANILA, Philippines — Pilipinas Shell Petroleum Corp. (PSPC) earned P4.4 billion in the first nine months of 2019, lower by 39 percent compared with the same period last year.
While this year’s earnings is lower than the P7.2 billion profit last year, it already makes up 86 percent of the firm’s 2018 full year net income of P5.1 billion.
“We are very pleased with Pilipinas Shell’s business delivery for the third quarter in the face of industry challenges and depressed regional refining margins. We assure all our stakeholders that we remain committed to maintaining safe and efficient operations to meet our customer expectations on quality products and services and close the year strong,” PSPC president and CEO Cesar Romero said.
PSPC said delivery grew by four percent during the period, backed by an integrated and highly efficient supply chain network.
Retail volumes increased by one percent from a year ago, bucking the industry’s one percent decline as of the first half of the year.
It added that retail also maintained a high premium fuel penetration of 27 percent, despite higher excise taxes.
“This performance is attributed to Shell’s high brand preference in the Philippines, coupled with quality fuel products and services backed by innovative marketing campaigns,” the company said.
PSPC closed the third quarter with a total of 1,105 retail stores, with 30 new stations opened in key areas across the country.
The company also continues to develop its non-fuels retail segment as it opened nine Select stores, five deli2go stores, and 23 Shell Helix Oil Change+ and Helix Service Centers during the period.
Meanwhile, for its commercial operations, PSPC said lubricants, bitumen, aviation and commercial fuels all posted an increase in volumes for the third quarter.
This was driven by bitumen, which posted a 50 percent volume growth as the company continues to support the government’s Build Build Build program and export products to international customers.
PSPC owns and operates the country’s sole bitumen production facility (operational since 2018), which allows for more flexibility, improved product costs and dexterity in addressing market changes.
In addition, lubricants posted a volume growth of seven percent, with products Shell Advance, Shell Helix and Shell Rimula emerging as the most preferred brands in the market.
PSPC is seeing the impact of its process efficiencies and other optimization initiatives in its refinery as cost savings at its refinery reached over P500 million as of September 2019.
Apart from completing the planned maintenance shutdown of its refinery ahead of schedule, it also broke ground on two key projects.
Once completed, an integrated hydrogen manufacturing facility will enable the refinery to process more crude oil varieties into more quality fuels.
PSPC said it is also working on building an integrated energy system which will harness solar energy, natural gas and battery system which will boost energy efficiency and stability in the refinery.