Oil refiner Petron Corp. spent about P7.6 billion for capital expenditure projects in 2018, slightly lower than P7.9 billion in 2017.
Petron spent the bulk or P2.8 billion for its 180,000-barrel-per-day Bataan refinery-related projects last year, according to the company’s report to the Philippine Stock Exchange.
Petron also spent P2.2 billion for the construction of new lube oil blending processing plant and other depot projects, P2 billion for service station-related expenditures and P600 million for other commercial, maintenance and miscellaneous projects.
The company allocated a slightly higher budget P7.9 billion in 2017, including P3.2 billion for the Petron Bataan Refinery turnaround and other refinery projects, P2.4 billion for the lube oil processing plant and other depot projects, P1.8 billion for service station-related expenditures and P500 million for other commercials, maintenance, and miscellaneous projects.
Petron, meanwhile, spent P85.57 million for research and development in 2018, higher than P75.57 million in 2017. Expenses in 2016 amounted to P66.24 million.
Petron’s R & D is responsible for all product development that complies with government laws and regulations, such as the Clean Air Act and the Biofuels Act.
“Other drivers of product innovations are the requirements of original engine manufacturers and the latest technological trends in the industry,” Petron said.
Petron posted a 50-percent drop in full year net income in 2018 to P7.1 billion following a sustained decline in global crude prices that resulted in inventory losses of P10 billion in the last two months of the year.
Petron’s operating income for the year reached P18.9 billion, down 32 percent from P27.6 billion in 2017.
The oil refiner said excluding the one-time item, the profit would have ended 21 percent higher at P17 billion.
“It was a challenging year, yet we captured majority of the market and remained the largest and fastest growing oil company in the country. While our long-term fundamentals remain attractive, we will continue to be prepared and responsive to market conditions,” said Petron president and chief executive officer Ramon Ang.
Consolidated sales rose 28 percent to P557.4 billion from P434.6 billion in 2017.