Wednesday, June 17, 2009 [ manilatimes.net ]
While its competitors opt for extensive chains of small stations, Eastern Petroleum Corp. said its expansion involves the establishment of “mega” stations.
In a briefing, Fernando Martinez, EPC chairman, said the company would put up three large stations, which will house other commercial establishments.
The facilities, each running up to 10,000 square meters, will be put up in Subic, Isabela and General Santos City. Construction is scheduled for completion in the first quarter of 2010.
Each mega station would cost P75 million as against the P2 million for its rivals’ smaller version.
Besides the three mega stations, EPC earlier inaugurated a large station in Polomolok, South Cotabato, and began construction of another one in Sampaloc, Manila.
The EPC official said the company is putting up the large stations despite the damper caused by the volatile price of oil and the global financial crisis.
“We are going to expand and have opportunity to do more business on the belief that the Philippine company will be resilient,” Martinez said.
In Thailand where the population is about 70 million the number of stations numbers over 7,000, double the 3,700 outlets in the Philippines, which has a population of over 90 million.
Once put up, EPC’s mega stations are projected to contribute P450 million in additional revenues per year.
Last year, the company registered revenues of P2.05 billion, an increase of about 50 percent from its 2007 sales. However, EPC’s net income decreased to P4.00 million or a two-thirds drop over the same period.
Martinez said the increase in sales volume and its lower profit were largely brought about by the sudden drop in oil prices in 2008.
The company expects its profits to fare better because of relatively stable oil prices and the introduction of weekly adjustments in pump prices since the start of the year.
Many industry players were caught flat-footed when oil prices collapsed beginning in the third quarter of 2008, leading to substantial losses.
The 30-day lag before world prices are reflected in the domestic market exacerbated firms’ losses.
-- Euan Paulo C. Añonuevo