Petron Corp. on Tuesday reported a net loss of P12.6 billion in the first nine months of 2020, a reversal from a profit of P3.6 billion in 2019, due to a 40-percent drop in domestic volume and P13 billion in inventory losses during the first four months of the lockdown.
Petron said in a statement the third-quarter performance, however, reflected a modest recovery as the company returned to profitability after posting a consolidated net income of P1.63 billion.
The company attributed the positive third-quarter income primarily to retailing margins despite losses from thin refining margins.
“While the oil industry continues to face major challenges, we are beginning to see signs of recovery thanks to our government’s decision to gradually and safely restart the economy. Aside from retail, we can also expect the reopening of local tourism to influence higher demand for aviation fuel which really took a hit because of the pandemic,” said Petron president and chief Ramon Ang.
Petron saw sales volume improve as quarantine restrictions became more relaxed and economic activities picked up in the third quarter after months of decline due to the coronavirus pandemic.
Petron’s consolidated retail volume from July to September registered a 48.6-percent improvement versus the second quarter.
Philippine volume jumped 33 percent with most Petron stations in the country operating under normal hours since August.
“We’ve also seen some improvements in Malaysia with a notable upturn in our domestic volume to almost pre-pandemic levels,” said Ang.
Consolidated sales volume from the Philippines and Malaysia in the first nine months contracted 24 percent to 59.5 million barrels from last year’s 78.7 million barrels.
Petron’s consolidated revenues also declined 43 percent to P216.4 billion from last year’s P381.7 billion as Dubai crude averaged $41.5 per barrel during the last quarter while refining cracks barely recovered from the lowest point of $2.20 per barrel in September to the current levels of around $2.80 per barrel.
“With our judicious use of resources, we are determined to expedite our overall recovery, minimize the pandemic’s impact on our business, and deliver more positive results,” Ang said.
Global oil prices remained depressed with the Dubai crude, the benchmark used by oil refiners averaging $41.5 per barrel during the last three months.
Petron, the only remaining refiner in the country, is also faced with arduous taxation not necessarily encountered by fuel importers, aside from operating under a volatile business climate.
“We have several tax-related concerns which we have already raised with the government. Under the current regime, refiners are faced with the burden of paying so much more taxes than importers making it more difficult for us to preserve the viability of operating a refinery in the country. Of course, we want to keep our refinery running and hopefully with the government’s support, we will be able to do this more efficiently,” Ang said.