PETRON Corp., the country’s largest oil refining and marketing company, said on Tuesday its consolidated net income in 2015 more than doubled, driven by a surge in sales volumes, better refining margins, and effective risk management.
The company said that despite the slump in global oil prices, consolidated net income grew to P6.3 billion in 2015 from P3 billion in 2014.
In a statement, Petron said all business segments in its Philippine and Malaysian operations contributed to volume growth as combined sales volumes reached 98 million barrels in 2015, a 13 percent growth from 2014’s 86.5 million barrels.
In its home market, Petron increased sales with strong demand coming from the Reseller, Industrial, and LPG segments. Volumes from service station sales grew by 11 percent while LPG grew another 16 percent over the period compared to 2014.
In Malaysia, Petron’s rebranding and upgrading program reaped dividends, with retail gasoline volumes growing by 11 percent.
Even with robust volume growth in 2015, Petron said it registered lower sales revenue of P360.2 billion, down 25 percent from the previous year due to a near 50-percent drop in oil prices.
“Benchmark Dubai crude averaged US$51 per barrel last year from US$97 the previous year. Dubai is currently averaging around US$30 per barrel. The Company’s performance was bolstered by proactive risk management to mitigate the impact of inventory losses and currency depreciation,” Petron said.
Despite weak oil prices in 2015, the differential between crude and finished products remained strong and the mix of higher value products improved, supporting refining margins. As a result, Petron’s operating income reached P18.1 billion last year, a 138 percent increase from P7.6 billion in 2014.
“Petron beat expectations and posted solid results last year. Low domestic prices and continued growth in the Philippine and Malaysian economies, coupled with our strategic investments, enabled us to reach record-breaking sales volumes,” Petron president Ramon S. Ang said.
“We are right where we want to be as we continued to grow our business profitably and sustainably,” Ang said.
Petron said its sales performance in the Philippines was supported by the initial test run and commissioning of its $2-billion refinery upgrade project in 2015.
In preparation for full operations this year, Petron’s refinery has hit a utilization rate of nearly 90 percent with an average run of nearly 160,000 barrels per day in the first two months of 2016.
The company also continues to aggressively expand its service station network in both countries to push more profitable domestic sales. As of end 2015, Petron had more than 2,200 stations in the Philippines and another 570 in Malaysia.
“We are definitely on track to deliver better results this year as we reap the benefits of our expansion and upgrading projects. We are well-positioned to take advantage of business opportunities in the downstream oil industry and sustain our growth momentum,” Ang added.