MANILA, Philippines – Leading oil company Petron Corporation reported a massive 70% drop in its bottom line for the 1st 9 months of the year, netting just P3.6 billion from the P12.1 billion it earned a year ago.

In a disclosure to the Philippine Stock Exchange on Tuesday, November 5, Petron attributed the sharp dip to prolonged depressed refining margins in the region and its refinery shutdown.

Its revenues went down by 9% to P381.7 billion from January to September.

“The company’s sales volume declined mainly due to lower Philippine volumes by 7% as a result of its Bataan Refinery’s emergency shutdown in April, partially cushioned by Malaysia’s volume increase of 2%. Global oil prices also remained volatile and lower compared to last year because of ongoing trade wars,” Petron said.

The company’s refinery in Bataan, which has a capacity of 180,000 barrels per day, resumed normal operations just in August. It marked its highest quarterly net income of P5.8 billion last year when the refinery opened.

Petron previously pointed to the government’s tax reform program as the reason for the drastic drop in earnings.

Despite the decrease in Philippine volumes, the company noted that its stations within freeport zones performed better than last year. Inside the Clark Freeport Zone, Petron retail volume registered a 54% increase year-on-year.

Service stations within freeport zones do not pay local and national taxes, including excise taxes.

Despite volatile market conditions, Petron was still able to open over 100 new stations in the Philippines and 38 new stations in Malaysia. Petron has over 2,400 stations nationwide.

Meanwhile, Petron president and chief executive officer Ramon Ang called for more reforms in the industry to curb smuggling. (READ: Petron says TRAIN law encouraged illegal business activities)

“This level playing field is what we hope will prevail in the entire country once the fuel marking program is in place. We fully support and look forward to its implementation but at the same time, we reiterate that this mechanism will only work if all players go by the same rules,” said Ang.

“Oil smuggling has worsened in recent years and it’s not only us in the industry but also the government and the entire nation that suffer because of it,” he added. – Rappler.com