Petron Corp.’s net loss in the first half of the year reached P14.2 billion, a reversal of the P2.6-billion net income it posted a year ago, mainly due to the collapse in global oil prices and the decline in fuel consumption.
Revenues also went down to P152.4 billion, from P254.8 billion during the period. Consolidated sales volume from its Philippine and Malaysian operations fell by 19 percent to 41.9 million barrels, from 51.9 million barrels a year ago due to the impact of Covid-19 on fuel demand.
Philippine sales volume dropped 28 percent due to reduced consumption, particularly by the aviation and retail industries, due to the lockdown restrictions imposed in cities.
The company suffered a net loss of P4.9 billion in the first quarter, compared to last year’s net income of P1.3 billion.
“The combined slump in demand, poor refining margins, and collapse in prices resulted in Petron’s consolidated net loss of P14.2 billion for the first six months of 2020 versus its P2.6 billion net income in 2019. During the said period, the company suffered inventory losses of nearly P15 billion,” the country’s No. 1 oil refiner reported Tuesday.
Petron said the worldwide lockdowns resulted in an “unprecedented demand destruction” which led to a sustained drop in oil prices, reaching record low levels in 26 years.
Dubai crude collapsed by almost 70 percent or $44 per barrel (bbl) from January to April when oil prices fell to as low as $13/bbl in daily trading. As oil consumption declined, refining margins also remained weak in the region.
Despite tough times, Petron vowed to continue improving its productivity and reduce expenses to cope with Covid-19’s impact. It has also initiated cash preservation initiatives and managed its capital expenditure spending.
“The company forecasts modest gains from inventory of about P3.5 billion in the second half of the year as prices start to recover. As the economy slowly reopens, we will need to find new ways to adapt to these new and unprecedented economic realities and remain resilient,” said Petron President and CEO Ramon S. Ang.
“Just as we have survived many hardships in the past, we know we can rely on our strong corporate culture to pull us through this most challenging period.”
Nearly all Petron service stations have reopened or resumed normal operating hours. Furthermore, Petron assures the public that its service stations remain safe and Covid-free.
On top of its already stringent standards, stricter safety protocols are now in place at its service stations to ensure that its customers and personnel remain protected from any threats of the virus.
“Expanding our safety protocols at our stations was something that we immediately did at the start of the pandemic. This includes temperature checks for our personnel, wearing of face masks, physical distancing, more frequent sanitation, and even promoting cashless payment. We also enforce even more rigid guidelines to reduce health risks and keep our facilities and communities safe,” Ang said.