PILIPINAS SHELL Petroleum Corp. sustained its recovery with a net income of P1.2 billion in the second quarter on the back of higher sales and the changes in its supply chain strategy, it said on Friday.
During the April-to-June period, the listed oil company reversed its P1.195-billion net loss a year ago. It also kept its momentum after the first quarter’s P1.02-billion net income.
In its stock exchange disclosure, Pilipinas Shell reported a 64.9% rise in net sales during the second quarter to P42.31 billion. Its costs of sales also climbed 50.2% to P36.82 billion.
For the first half, the company posted a P2.22-billion net income, swinging from a net loss of P6.74 billion a year ago. It attributed the reversal to a shift in its supply chain strategy.
Cesar G. Romero, Pilipinas Shell president and chief executive officer, described the company’s first-semester performance as a “significant rebound” after the previous year’s loss.
“It validates our bold decision to transform the way we do business amidst uncertain conditions resulting from the Covid-19 pandemic,” Mr. Romero said in the disclosure.
On June 30, the company launched Shell Import Facility Tabangao, or SHIFT, which changed its refinery in Batangas into a world-class import terminal that will address fuel demand in Metro Manila, Southern Luzon, and Northern Visayas.
For the six-month period, the company’s net sales rose 11.1% to P82.23 billion compared with P74.03 billion a year ago.
In contrast, Pilipinas Shell’s cost of sales fell 6.8% to P70.76 billion from P75.92 billion the previous year.
For the period, the company posted a 45% increase in the sales of bitumen products amid the sustained support for road construction projects.
“Shell Instapave, with its innovative quick-application technology, was used for road repairs in North Luzon and residential builds in Visayas. Shell Bitufreshair was used for infrastructure projects all over the country, enhancing the air quality for motorists and passengers,” the company said.
Pilipinas Shell said its marketing volume for the second quarter rose 18%. However, its marketing volume delivery for the first half was flat compared to previous years as a result of travel restrictions caused by the pandemic.
“The [second quarter] increase stems from innovative marketing initiatives that focus on the consumer’s fuel and non-fuel needs and use digital means to improve customer engagement and perception,” the company said.
“Strong volume and profit performance were also seen in the lubricants business, with premium products growth and deeper consumer penetration nationwide seen as key levers. The introduction of the Coolant Longlife Plus product line in the second quarter is expected to drive further growth for the segment,” it added.
Pilipinas Shell said it opened 15 mobility sites in the first half, while its non-fuel network as of end June totalled 153 Shell Select stores, 235 Select Express, 70 Deli2Gos, 415 Lube bays, and 353 Shell Helix Centers.
Mr. Romero said that while the pandemic poses challenges to the country’s economic recovery, it does not preclude growth.
“We intend to continue to be the preferred energy partner for the industries that we serve, and the country itself, to thrive in a better normal,” he said.
On Friday, shares of Pilipinas Shell at the stock exchange declined 1.01% or 18 centavos to close at P17.62 each. — Revin Mikhael D. Ochave