Petron sees 30% hike in 2016 profit

MANILA, Philippines - Petron Corp., the country’s largest oil refiner, sees a 30-percent growth in profit this year on the back of steady volume, a ranking official said yesterday.

A 30-percent hike in earnings would translate to about P8.2 billion from P6.3 billion last year.

The company’s operating income is also seen to reach P20 billion by the end of the year.

Emmanuel Eraña, Petron SVP and CFO, said the company would add around 200 new retail branches every year to its existing network of 2,240 service stations nationwide to meet growing demand for fuel.

“We will significantly grow our profit compared to last year. We should be doing 30 percent (growth this year),” he told reporters yesterday on the sidelines of the  listing of the company’s P20 billion bonds at the Philippine Dealing and Exchange Corp.

Volume continues to grow as demand for fuel remains strong, Eraña said.

Despite the expected increase in growth this year, Eraña said Petron has yet to reach its full potential, which should happen in the next three to four years.

Eraña said the industry was still suffering from flat margins because of depressed world crude prices which hounded the global oil industry as a result of oversupply.

The company operates the Limay Refinery in Bataan, which has a capacity of 180,000 barrels per day.

At the start of the year, Petron commissioned its $2 billion refinery upgrade which increased the facility’s capacity to produce more high-value fuels and petrochemicals, making it one of the most advanced in Asia.

Petron successfully raised P20 billion from the sale of five- and seven-year fixed rate bonds to retail investors. This forms part of the the first tranche of the company’s shelf registration of P40 billion worth of bonds.  

Eraña said the offering was twice oversubscribed and was priced at the tight end of the marketing range.