Post-TRAIN: This Is How Much Gas Station Companies Earned in 2018

The first tranche of the Duterte administration’s Tax Reform for Acceleration and Inclusion (TRAIN) Act took effect on the first day of 2018.

The first package of the law brought significant changes to the Filipino people, especially the working class. While the Department of Finance (DoF) designed the law to “lessen the overall tax burden of the poor and the middle class” by reducing their personal income taxes, it also imposed higher excise taxes on several goods to offset its effects.

Among the consumer goods that saw a significant increase in prices due to TRAIN are automobiles and petroleum products.

Since the country’s listed firms release their audited annual reports for the year 2018 around this time of the year, it’s timely to take a look at how some of the companies affected by the TRAIN law have performed during the maiden year of the law’s implementation.

We’ve already looked at how the country’s retail companies have performed under TRAIN, so let’s take a look at the financials of the three biggest gas company retailers in the country this time.

How did the biggest gas retailer companies in the Philippines do financially in 2018?

The three biggest retailers of gas products in the countryPetron Corporation, Pilipinas Shell Petroleum Corporation, and Phoenix Petroleum Philippinesall recorded higher gross sales in 2018.

(Note: We first limited the list based on BusinessWorld’s Top 1000 Corporations list. We found 43 companies under the classification “retail sale of liquefied petroleum gas and other fuel products” from 2003 to 2016. From these 43, we further trimmed the list to just all the publicly-listed firms on the Philippine Stock Exchange (PSE). That brings the final list to just three.)


Among the three, Davao-based rising tycoon Dennis Uy’s Phoenix Petroleum recorded the highest increase in gross revenues. It doubled from P44.5 billion in 2017 to P88.6 billion in 2018, driven largely by its sale of goods.

Both Petron and Pilipinas Shell, on the other hand, recorded a 28-percent growth in gross sales for the year 2018. Petron’s revenues grew from P434.6 billion in 2017 to P557.4 in 2018, while Pilipinas Shell’s increased from P174.5 billion to P223.8 billion in just a year.

Higher gross sales, but lower profits

However, prices of oil in the global market rose significantly in 2018 and dropped in the last two months, and it took a toll on both Petron and Pilipinas Shell’s net income.

Profits of the SMC-owned oil refining and marketing company dropped by 50 percent in 2018, which it attributed to the sustained decline of world crude prices in the last two months of the year. The company said this incident caused the firm to lose P10-billion worth of its inventory.

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“It was a challenging year, yet we captured majority of the market and remained the largest and fastest growing oil company in the country. While our long-term fundamentals remain attractive, we will continue to be prepared and responsive to market conditions,” said Petron President and CEO Ramon S. Ang in a statement.

Likewise, Pilipinas Shell saw its cost of sales and expenses increase by 32 percent from 2017 to 2018. The company’s audited financial statements show that its crude and product costs last year grew to P169.8 billion from P130.4 billion the previous year. Moreover, the company also reported lower finance income and higher finance expenses in 2018. The company’s interest on debts and borrowings, realized foreign exchange loss, accretion expenses, and bank charges grew by 72 percent in just a year.

Still, the company is optimistic and remains proud of their achievements amid the “aggressive competition and higher pump prices for the most part of 2018.” The company explained in its official statement: “The manufacturing segment recorded highest reliability in five years, but contribution to the integrated business was impacted by the sudden drop in crude prices in Q4 and depressed regional refining margins.”


The only winner among the three was Phoenix Petroleum. While its two biggest competitors recorded declines in their respective net profits, Phoenix Petroleum posted a remarkable 82-percent increase in income amid the movements in the global oil market.

The company cited accelerating growth in its domestic business, which saw a 15-percent volume increase in LPG and fuels, a five-percent retail volume growth, and 13-percent surge on commercial volume.

“Despite industry headwinds in Q4, we worked together to deliver a strong close to 2018. We re positioning ourselves for more success in 2019 and beyond, with a focus on growth, execution, and delivering for our customers and shareholders,” said Phoenix Petroleum Chief Operating Officer Henry Albert Fadullon in a statement.

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Pauline Macaraeg
Esquire Philippines
Pauline is Esquire Philippines’ data journalist. Follow her on Twitter @paulinemacaraeg.
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