Friday, August 01, 2008 Petron bares decrease in income
OIL giant Petron Corporation on Thursday reported that its net income for the first half of 2008 dipped by 14 percent due to "unprecedented rise in crude costs and higher financing costs."
Nicasio Alcantara, president and chief executive officer of Petron, said its net income for the first six months of the year hit P2.32 billion lower than the P2.7 billion it posted in 2007 during the same period.
"Despite this drop in our net income caused by exceptional external factors, we remain optimistic of meeting our financial targets," Alcantara said in a press briefing shortly after their 14th Annual Stockholders meeting at the SMX Convention in Pasay City last Thursday.
Dubai crude has increased 49 percent from an average of US$85.58 per barrel in December 2007 to US$127.87 per barrel in June.
It continued to increase breaching the US$140 per barrel last month.
At present, it is averaging US$133 per barrel.
But Alcantara said that despite the high fuel prices, the company was able to increase its domestic sales by 3.3 percent in first six months of the year to 21.29 million barrels per day from the 20.61 million barrels for the same period last year
"With our diversification strategy, particularly our efforts to increase our production of petrochemicals, we are in stronger position to cope with oil price volatility," he added.
Total sales revenue also amounted to P131.32 billion or 33 percent higher than the P98.79 billion last year.
Petron comptroller Concepcion de Claro, on the other hand, explained that the decline in their income primarily affected the export but their domestic sales remain afloat.
"The drops are merely in the exports, and it is mainly during the first quarter of the year," Claro said.
Moreover, Alcantara said the downtrend in the demand for the first semester was in gasoline.
Fuel consumption, Alcantara said, also dropped to 293,000 barrels per day this year as compared to the 294,000 barrels per day last year.
He also reported that as part of their diversification, Petron added 15 more stations in the first half of 2008 bringing its total service station nationwide to 1,284.
The oil firm still dominates the industry holding 46.7 percent market share.
Petron commissioned the first petrochemical feedstock units last April in its Bataan refinery.
The PetroFCC which converts fuel oil into more high value products such as liquefied petroleum gas (LPG), gasoline and diesel also produces petrochemical feedstock propylene.
Aside from the PetroFCC plant, A BTX unit is also under construction in Bataan to produce additional petrochemical feed stocks.
This unit has an annual capacity of 22,800 metric tons (MTs) of benzene, 150,00 MTs of toluene, and an additional 71,000 MTs of mixed xylene.
It is expected to be completed in the first quarter of 2009. (MSN/Sunnex)
