Petron income jumps to P2.9-B

Petron Corp., the country’s largest oil refiner, posted a net income of P2.9 billion for 2002, a hefty 141.6 percent increase from its P1.2-billion earnings in 2001.

The company said its higher net income was achieved with exports of straight-run fuel oil rising by 40 percent to 8.2 million barrels from 5.8 million barrels in 2001.

"We attribute our improved bottom line largely to continuing efforts to find new markets for our products, but our operating efficiency also continues to improve," said Virginia A. Ruivivar, corporate communications manager of Petron. She added: "We kept our operating costs slightly below the level in 2001 despite an inflation rate of 3.1 percent."

For 2002, Petron’s total sales volume was up 4.2 percent to 49.4 million barrels from 47.4 million barrels in the previous year.

Aside from its improved export sales, Petron also posted increases in its commercial or industrial accounts inspite of steadily declining fuel purchases of one of its biggest customers, the soon-to-be-privatized National Power Corp.

This allowed the company to keep its top slot in the local oil industry with a commanding market share of 38.2 percent.

Petron said its earnings also improved on the back of lower financing costs as well as effective risk mitigation measures. It added that non-operating charges went down by 37 percent, or by nearly P600 million.

While Petron’s sustained cost discipline and sound financial management improved its bottom line, the 2002 net income is still lower than its record net income of P4.2 billion in 1996 when the industry was deregulated.

Created on Dec. 15, 1966, Petron is the Philippines‚ top oil refining and marketing company, supplying more than one-third of the country’s oil requirements.

Its refinery is located in Limay, Bataan which processes crude oil into a full range of petroleum products, including liquefied petroleum gas, gasoline, diesel, jet fuel, kerosene, industrial fuel oil lubes and greases and asphalts.

From the refinery, Petron moves products mainly by sea, using tankers and barges to distribute products to a nationwide network of bulk plants and terminals. Through this network, it sells fuel oil, diesel and LPG to industrial customers.

Petron has long-term lease agreements with the Philippine National Oil Co. until August 2018 covering certain lots where its refinery and other facilities are located. Lease charges on refinery facilities escalate at two percent a year, subject to increase upon reappraisal.