WEAK demand for fuel resulting from escalating prices has resulted in Petron Corp.’s income to dip by 14 percent to P1.56 billion for the third quarter of 2011 from P1.81 billion for the same period last year.
In a disclosure to the Philippine Stock Exchange, Petron said revenues amounted to P67 billion amid a 7-percent drop in sales volume during the period.
Petron noted a decline in earnings for the third quarter compared with the previous two quarters.
Aside from the weak demand, Petron added that aggressive competition—particularly in the retail and industrial sectors—has also affected revenues in the third quarter.
The company said for the first nine months of the year, it registered total earnings of nearly P202 billion and net income of P7.6 billion due to the sale of higher-margin petrochemicals that contributed about P2.5 billion in earnings.
Petron said petrochemical and export volumes for the nine-month period grew 17 percent over same period last year.
“Despite the challenging business environment, Petron remains poised to sustain its growth momentum with the programs we have in place and in the pipeline,” Ramon Ang, Chairman and Chief Executive Officer, said.
He added that Petron’s modernization and expansion programs are already yielding tangible results and that they expect much better yields, more efficient production and optimized distribution upon the completion of its expansion program for its refinery in Limay, Bataan.
In the second quarter of 2011, Ang noted that Petron embarked on its largest and most ambitious project to date— the $2-billion refinery expansion program to increase the Limay refinery’s capacity to 180,000 barrels per day.
When completed in 2014, Petron will be able to refine cheaper crude oil from more sources, convert its low-margin fuel oil production to white products (liquefied petroleum gasoline, diesel and gasoline) and petrochemicals, and be the only oil company capable of locally producing Euro IV-compliant fuels.
Petron has also been successful in implementing its network expansion program over the past few years.
The company currently has almost 1,800 service stations nationwide, the largest network in the oil industry by far.
