Shell income drops to billion in Q1

On leaner refining margins, the net earnings of second biggest oil player Pilipinas Shell Petroleum Corporation had declined to R2.3 billion in this year’s first three months from a heftier profit level of R2.89 billion in the same period last year.

The Philippine subsidiary of the Anglo-Dutch energy giant said “softer regional refining margins during the quarter contributed to the roughly 20 percent decrease in overall earnings.”

On a positive note though, Pilipinas Shell noted that its R2.3-billion income within the quarter “translates to an industry-leading return on capital of 27 percent on a trailing 12month basis.”

It emphasized that such manifests “the company’s continuing prudent and effective utilization of shareholder capital.”

Pilipinas Shell has logged 4.0 percent hike on sales volume during the first quarter, and this partly contributed to the 23 percent jump on operational cash flows that reached R3.5 billion year-on-year. The other factors shoring up performance on this sphere had been higher premium fuel penetration and better working capital management.

Fundamentally, as reckoned by Pilipinas Shell President and Chief Executive Officer Cesar G. Romero, the company’s first quarter financial outcome “demonstrates the strength of our brand. Amidst the challenges brought by higher excise taxes, customers continue to patronize our products.”

The oil firm, he said, “saw an increase in V-Power uptake of 2.0 percent versus first quarter of 2017,” adding that “we remain pleased with our marketing businesses which continue to demonstrate strong underlying performance both financially and operationally.”

In particular, Shell’s nonfuels retailing business maintained its double-digit growth with an impressive 21 percent expansion. This was generally backed by addition of 11 new Shell “Select” stores; seven new deli2Go offers; and nine new lube bays.