Oil distributor Petron Corp. said net income shrank 88 percent in the first quarter to P257 million from P2.2 billion a year ago, dragged down by a sharp drop in oil prices and inventory losses.
Petron said in a statement the first-quarter net income would have been much higher if not for the inventory loss of about P3 billion in the quarter.
Revenues decreased 31 percent to P86.7 billion, reflecting the drop in oil prices. Volume sales, however, increased 10 percent to 22.9 million barrels in the first quarter from 20.7 million barrels in the same period last year.
Philippine volumes surged 20 percent to 14.3 million barrels as Petron saw growth in key market segments.
Petron said in the first quarter of 2015, benchmark Dubai crude averaged $52 per barrel, down from $104 a barrel in the same period last year.
“While the drop in oil prices put pressure on our margins, efforts to increase sales volumes, the completion of strategic projects, and our disciplined approach to risk management moderated its impact,” Petron president and chief executive Ramon Ang said.
“We fully understand that long-term growth will always be disrupted by short-term instability and our investments will enable us to grow, even thrive in this challenging business environment. With RMP-2 expected to be fully commissioned in the next few months, margins will be more stable despite volatility in crude prices,” Ang said, referring to the upgraded Bataan refinery.
Petron said the sales growth in the first quarter was anchored on retail expansion program and maximizing sales in its existing network.
Petron has an additional 300 service stations in the pipeline over its current 2,800 to ensure its premium fuels and services benefit more customers in the Philippines and Malaysia.
Petron is the largest oil refining and marketing company in the Philippines and is a leading player in the Malaysian market.