Petron Corp. ended the first quarter with a net loss of P4.9 billion, a reversal from the net income of P1.3 billion it recorded in the same period last year, due to the decline in fuel demand.
The company attributed the reduction in the demand for petroleum products to the implementation of quarantine restrictions to contain the spread of coronavirus disease 2019 (Covid-19).
“The entire industry is going through a rough phase because of Covid-19’s impact on oil demand and prices. As expected, domestic consumption has gone down particularly in retail and aviation which is understandable because of travel bans and restrictions,” said Petron President and CEO Ramon S. Ang.
Revenues also went down by 16 percent to P104.6 billion at end-March this year, from P124.6 billion in the same period a year ago. Also, the combined sales volume of Petron in the Philippines and Petron Malaysia was also lower at 24.7 million barrels, from last year’s 26.3 million barrels.
The benchmark Dubai crude plummeted by about 66 percent to $23 per barrel (bbl) by end-March from $67/bbl by end-December last year.
Ang explained that the Philippines and Malaysia imposed strict lockdowns towards the end of the first quarter, limiting movement and economic activity, to contain the spread of Covid-19.
Since the enhanced community quarantine (ECQ) was implemented in the country, some Petron stations have temporarily closed or shortened their operating hours due to the drop in the number of vehicles on the road.
Petron has activated its Business Contingency Plan to cope with the crisis due to the pandemic. This includes strict cost-saving and cash conservation measures.
“Business is challenging. We have to be more prudent in managing our resources while ensuring that the needs of our customers are still met. Demand recovery will depend upon the lifting of quarantine measures and ultimately, finding a vaccine to fully restore mobility.
While we are hopeful for a swift recovery, we know that these are things we cannot rush. The health and safety of the people is still the most important,” said Ang.
Since May 5, Petron’s Bataan refinery has been on a scheduled turnaround to give way to maintenance activities on major process units. Also, the plant shutdown will mitigate the impact of low fuel demand and poor refining margins. Nonetheless, it assured that it has enough inventory to supply domestic market requirements, which will be replenished through importation of finished products.
Despite the challenging business environment, Ang said Petron will continue to help alleviate the burdens of Filipinos particularly those on the frontlines as well as its scholars, communities, and other stakeholders.
Assistance in the form of fuel cards and other donations has been extended to medical frontliners and staff from various hospitals. Petron also launched a donation drive wherein Petron Value Card (PVC) holders can donate their points to help procure medical supplies and relief packs for health workers. For a certain period, Petron matched donations to generate more funds.
Petron has allotted over P1 million in assistance to its scholars in all levels nationwide. It has also donated food to its host communities as well as to health workers and personnel.
Having the most extensive service station network in the country, Petron’s wide presence is also proving valuable in boosting food accessibility through the initiatives of its parent company, San Miguel Corp. (SMC).
Petron stations now serve as sites for SMC Logistics’ reefer van-cum-rolling stores, providing consumers with a safe and convenient way to shop for food items during the quarantine. The food trucks contain frozen poultry products, fresh and processed meats, and ready-to-eat goods.
A number of Petron stations have become a venue for farmers in the province to sell their fresh harvest through a partnership with the Department of Agriculture.