Petron improves Q3 income on retail gains as economy reopens

ABS-CBN News

Posted at Nov 03 2020 07:32 PM

Petron improves Q3 income on retail gains as economy reopens 1
A gas station attendant fills up a customer's vehicle in Quezon City on April 27, 2020. Petron Corp said it suffered a net loss in the first quarter, as the COVID-19 pandemic and resulting global lockdowns sapped demand. Mark Demayo, ABS-CBN News/file

MANILA - Petron said Tuesday its net income improved in the third quarter due to the increase in retail sales after the easing of lockdowns in the Philippines and Malaysia.

Petron’s disclosed to the stock market that its third quarter net income rose to P1.63 billion versus P1 billion in the same period last year.

This gain was driven primarily by the strong 48.6 percent growth of its retail business both in the Philippines and Malaysia, which outweighed the losses in its refining segment.

Petron Philippines retail sales volume contributed the most, soaring 33 percent as most Petron stations nationwide started operating under normal hours in August.

“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. We’ve also seen some improvements in Malaysia with a notable upturn in our domestic volume to almost pre-pandemic levels,” said Petron President and CEO Ramon Ang.

Despite the rebound in the third quarter, Petron still had a net loss of P12.6 billion in the first 9 months, compared to a net income of P3.6 billion in the same period last year.

Petron has warned that it may permanently shut down its Bataan refinery saying the current tax system favored importers of finished petroleum products to the detriment of refiners. 

“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.

Last August, Pilipinas Shell announced the permanent closure of its refinery in Batangas, citing it was no longer economically viable for it to continue running the facility. 

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