Pilipinas Shell rebounds with P1-B income

PILIPINAS Shell Petroleum Corp. booked a net income of P1 billion in the first three months of 2021, a strong rebound from the P5.5 billion loss recorded in the same period last year.

In a disclosure to the local bourse, Pilipinas Shell attributed the significant profit turnaround to the company’s new supply chain strategy, higher premium penetration across all segments, and continued cash conservation measures.

“We are now seeing the positive results of the tough decisions we made that ensured our financial resiliency and competitiveness brought about by the Covid-19 (coronavirus disease 2019) pandemic. The difficult decision to transform our refinery into world-class import facility allowed us to avoid the significant losses we incurred during the first half of 2020,” said Pilipinas Shell President and Chief Executive Officer Cesar Romero.

“We have yet to see fuel demand to go back to prepandemic levels. With our refocused and reset strategy, we are well-positioned to meet the country’s energy requirement as the economy recovers from the pandemic,” he added.

Cash flow of Pilipinas Shell from operations excluding movement in working capital was at P3.9 billion, while its borrowings remain at a manageable level.

The company noted that volume delivery remains below pre-Covid levels, as Covid-19 cases increase and stricter quarantine measures in key cities nationwide resumed during the latter half of March.

For the January to March period, total volume dropped by 31 percent year-on-year, while marketing volume went down by 16 percent.

Meanwhile, its lubricants and bitumen segment were up by 12 percent and 27 percent, respectively, driven mainly by new customer wins and increase in economic activities in some industries.

“Our first quarter performance indicates that we are taking the right steps to deal with the Covid-19 pandemic. We will persevere and implement our bounce back plans sharply in a safe and reliable manner,” Romero said.

He also said Pilipinas Shell is moving forward in making business more environmentally sustainable “by reducing carbon use in our operations, and partnering with our customers to reduce theirs.”