The combined slump in demand, poor refining margins, and collapse in prices resulted in a P14.2 billion net loss, a reversal of the P2.6 billion profit Petron booked in the same period last year.
Consolidated revenues dived 40% to P152.4 billion as sales volume from both Philippine and Malaysian operations declined 19 percent to 41.9 million barrels.
Philippine sales volume dropped 28% due to reduced consumption,particularly in aviation and retail, with the implementation of stricter quarantine protocols in the country. During the period, Petron suffered inventory losses of almost P15 billion.
The worldwide lockdowns resulted in an unprecedented demand destruction which led to a sustained drop in oilprices,reaching record low levels in 26 years.
Dubai crude collapsed by almost 70 percent or $44/bbl from January to April wherein oil price fell to as low as $13/bbl in daily trading. As oil consumption declined, refining margins also remained weak in the region.
“We continue to improve our productivity and reduce our expenses to help the company cope with COVID-19’s impact. At the same time, we initiated cash preservation initiatives and prudently manage our CAPEX. The company forecasts modest gains from inventory of about P3.5 billion in the second half of the year as prices start to recover,” said Ramon S. Ang, president of Petron.
“As the economy slowly reopens, we will need to find new ways to adapt to these new and unprecedented economic realities and remain resilient. Just as we have survived many hardships in the past, we know we can rely on our strong corporate culture to pull us through this most challenging period,” he added.