Petron Corp. said Wednesday it incurred a net loss of P11.4 billion in 2020 from a net income of P2.3 billion in 2019, brought about by the impact of the COVID-19 pandemic to the oil industry.
Consolidated sales volume fell 27 percent last year to 78.6 million barrels from 107 million barrels in 2019. Revenues declined 44 percent to P286 billion from P514.4 billion, reflecting the impact of the pandemic on Petron’s financial performance.
“We have been working hard to minimize the impact of the pandemic on our business and our performance in the second half of 2020 proves that we are moving in the right direction. We look forward to sustaining our recovery as we anticipate higher demand and a more stable industry situation with an end to this crisis finally in sight,” said Petron president and chief executive Ramon Ang in a statement.
Petron posted a consolidated net income of P1.2 billion in the fourth quarter on increased volumes and inventory holding gains as prices began to rally towards yearend.
The company said, however, refining margins remained soft which challenged the economic viability of the Philippine operations.
Petron ended the fourth quarter with consolidated revenues of P69.6 billion, marking two straight quarters of growth, after experiencing a historic slump in the second quarter because of the pandemic’s economic impact.
Petron said the last quarter of the year registered a 46 percent improvement from the P47.7 billion reported in the second quarter, the oil firm’s hardest-hit period in 2020.
Consolidated sales volume in the fourth quarter reached 19.08 million barrels, up 6 percent from the second quarter sales of 17.9 million barrels despite the general community quarantine extension in key cities in the country and another conditional movement control order in Malaysia.
Petron said it was focusing on further improving its competitiveness given the industry condition.
Petron’s 180,000-barrel-per-day Bataan Refinery was granted approval as a registered enterprise in December 2020 by the Authority of the Freeport Area of Bataan.
FAB-registered enterprises are entitled to avail of fiscal incentives under Special Economic Zone Act of 1995 or Omnibus Investment Code of 1987.
Petron said this would benefit the company in the form of better timing on the payment of value added tax which would be upon withdrawal of the products from the refinery.
“We continue to implement various cost-saving efforts but tax efficiency is another critical area that should improve. Our AFAB registration will help make our refining business more competitive and financially viable as soon as demand recovers,” said Ang.
