Petron sees profit rising by 18% in 2012

Petron Corp., the country’s biggest oil refiner and retailer, is targeting an 18-percent increase in its consolidated net income this year to P10 billion from P8.5 billion a year ago.

In a briefing following the company’s stockholders’ meeting Tuesday, Petron chairman Ramon S. Ang said the company was hoping that oil prices would remain stable throughout the year so it could attain the P10-billion target.

“The problem with Petron is when world oil prices are going down and it has a lot of inventory, it will incur losses. If world oil prices are stable, the results should be better in the next three quarters,” he said.

For as long as oil prices do not go lower than $100 million, he said the target was achievable.

Also contributing to this year’s earnings is the planned expansion of its retail network by about 1,000 stations to a total of 3,000 stations by the end of the year.

“It’s going to be a combination of dealer-owner or company-owned. It will also be a combination of micro, large and mega stations. The gas stations will cost an average P15 million each,” Ang said.

He said he expected Petron Oil Gas International Sdn Bhd, the offshore affiliate that acquired a 73.32-percent stake in Esso Malaysia Berhad, to also start contributing to the balance sheet of Petron by the second half this year.

“We’ve already started consolidating the Malaysian operations, so we could see its full effect after the second quarter,” he said.

The current earnings of Esso Malaysia Berhad is about half of Petron, or about P5 billion, according to Ang. This Malaysian firm’s expected contribution is not included in the P10 billion target of Petron for this year.

Petron Oil Gas International acquired last year a 65-percent stake in Esso Malaysia Berhad and a 100-percent interest in two other unlisted subsidiaries of US giant Exxon Mobil Corp., for $577.3 million.

A tender offer held in Malaysia this year allowed Petron to acquire an additional 8 percent stake from existing shareholders, bringing its total holdings to 73.32 percent.