BEIJING, Aug. 26, 2015 /PRNewswire/ -- China Petroleum
& Chemical Corporation ("Sinopec Corp." or the
"Company")(HKEX: 386) (SSE: 600028) (NYSE:
SNP) today announced its interim results for the six months
ended 30 June 2015.
Financial Highlights:
- In accordance with China Accounting Standards for Business
Enterprises ("ASBE"), the Company's operating profit of the Company
was RMB 39.3 billion, representing a
decrease of 12.4% over the same period of 2014. Net profit
attributable to the equity shareholders of the Company was
RMB 24.4 billion, a 22.3% decrease as
compared with the first half of 2014. Basic earnings per share was
RMB0.202
- In accordance with the International Financial Reporting
Standards (IFRS), the Company's total turnover and other operating
revenue was RMB 1,040.4 billion,
23.3% lower than the same period of last year. The Company's
operating profit was RMB 40.5
billion, representing a decline of 22.4% from the same
period last year. Profit attributable to shareholders of the
company was RMB 25.4 billion, 22.0%
lower than the same period of last year. Basic earnings per share
was RMB0.211.
- In accordance with IFRS, the Company's liability-to-asset ratio
of Sinopec Corp. was 46.48%, representing a decrease of 9.04
percentage points compared with the end of last year, lowest level
since its debut on the capital market. As of 30 June 2015, the Company's cash and cash
equivalents were RMB72.5 billion, an
increase of RMB 63.5 billion as of
31 December 2014. The Company's cash
flow and financial position was further improved.
- The Board of Directors proposed an interim dividend of
RMB0.09 per share, maintaining the
same level year-on-year. Total dividend to be paid will amount to
RMB10.9 billion, up by 3.7%
year-on-year.
Business Highlights:
In the first half of 2015, the global economic recovery remained
slow. China's GDP grew by 7.0%.
The domestic demand of crude oil maintained a steady growth,
increasing 4.8% year on year, and natural gas demand growth slowed
down, up 2.1% year on year. Refined oil products demand continue to
diversify following last year's trend with a slower growth rate.
Gasoline and kerosene consumption increased substantially while
diesel dropped slightly. The total consumption of refined oil
products grew by 3% compared with the same period of last year.
Quality upgrading of oil products was accelerated. Domestic oil
products prices were adjusted timely in line with the international
oil price changes. Domestic demand for chemicals maintained a
steady growth with the ethylene equivalent consumption up by 2.5%
compared with the same period of last year.
Amid a challenging market environment, the Company achieved
solid operating results through optimizing its operation, focusing
on cost control, expanding new markets and fully utilizing its
integrated advantages. The Company's refining and chemicals
businesses achieved robust operating results and became the profit
drivers during the period, leveraging on its Integrated
Advantages
- Exploration and Production: the Company took effective measures
in low oil price environment in the first half of 2015, including
optimising the exploration and production plans, setting up
flexible investment decision making mechanism and cutting high-cost
crude oil production. The operating loss of this segment was
RMB 1.8 billion in the first half of
2015, representing a decrease of RMB 30.1
billion in operating profit compared with the same period of
2014.
- Refining: the Company, while focusing on profitability,
optimised the crude oil allocation and processing plans, adjusted
the product slate and utilisation rate, and increased the yield of
high value-added products, such as high-spec gasoline. We brought
our scale advantages into full play to control the unit cost. We
actively promoted the quality upgrading of refined oil products and
provide high standard fuels to the market. We also took advantages
of specialised operation by improving our dedicated marketing
network. The segment realized an operating profit of RMB 15.3 billion in the first half of 2015,
representing an increase of 57% over the same period of 2014. The
refining margin was USD7.72 per
barrel, representing an increase of 15.8% year-on-year.
- Marketing and Distribution Segment: the Company optimised
marketing structure to increase retail volume and single station
throughput. We accelerated the transformation from an oil products
supplier to a comprehensive service provider by complimenting the
rapid development of non-fuel business with that of fuel business
and achieving volume and profit growth. In the first half of 2015,
the segment's operating profit was RMB15.2
billion, representing a decrease of 19.2% over the same
period of 2014. Revenue from our non-fuel business reached
RMB 13.33 billion, an increase of
85.4% from the same period in 2014.
- Chemicals: the Company further optimised feedstock and product
mix to achieve better cost efficiency. We put our efforts in
R&D, production and marketing of new products, and maintained
production volume growth in high value-added products. The
segment's operating profit during the six-month period ended
30 June 2015 was RMB 10.1 billion, representing an increase of
RMB 14.1 billion compared with the
same period of 2014
Mr. Wang Yupu, Chairman of Sinopec said, "Sinopec continuously
improved its corporate governance, expanded its business and
enhanced its competitiveness by riding on the rapid growth of
Chinese market, leveraging its integrated advantages, and deepening
reform and continuous commitment to excellence. Especially during
the first half of 2015, despite the slowdown of domestic economy
and low oil prices, the Company managed to navigate through the
challenging and complicated market environment and achieved solid
operating results, through tapping new resources for growth and
reducing expenditure, optimizing production and operation, reducing
costs and expenses as well as expanding new markets. Looking
forward, the Company is facing challenges from the changing global
political and economic landscape, the shifting of growth engine in
Chinese economy, and volatilities in the industry and the market.
But at the same time, the Company also has unprecedented growth
opportunities. The Company is drafting its 13th Five-Year-Plan.
We'll proactively adapt to the New Normals in China's economic growth and the megatrend of
the world's economy and the business cycle. We will prioritise on
reforms, consolidation of resources, integrated operations,
innovation and value creation. We will further develop our growth
strategies to seize the opportunities arising from the nation's
strategic initiatives which include the "One Belt, One Road"
initiative, the Coordinated Development of Beijing, Tianjin and Hebei, the development of Yangtze
River Economic Zone and the
Made in China 2025 plan."
Business Review
Exploration and Production
The Company took effective measures in low oil price environment
in the first half of 2015, including optimising the exploration and
production plans, setting up flexible investment decision making
mechanism and cutting high-cost crude oil production. In
exploration, we attained new discoveries and commercial flows in
marine faces gas fields in the west of Sichuan. In development, the Fuling shale gas
project progressed steadily. Oil and gas production in the first
half was 232.95 million barrels of oil equivalent, down by 1.7%
compared with same period of last year. Domestic and overseas crude
oil production amounted to 147.47 million barrels and 26.60 million
barrels respectively while natural gas production reached 353.26
billion cubic feet.
In the first half of 2015, operating revenue of the segment was
RMB70.4 billion, representing a
decrease of 38.2% over the first half of 2014. The operating loss
of this segment was RMB 1.8 billion
in the first half of 2015, representing a decrease of RMB 30.1 billion in operating profit compared
with the same period of 2014 due to the sharp decline of the
international crude oil prices.
Exploration and
Production: Summary of Operations
|
|
Six-month period
ended 30 June
|
Changes
|
2015
|
2014
|
%
|
Oil and gas
production (mmboe)
|
232.95
|
237.01
|
(1.71)
|
Crude oil production
(mmbbls)
|
174.07
|
177.88
|
(2.14)
|
China
|
147.47
|
154.15
|
(4.33)
|
Overseas
|
26.60
|
23.73
|
12.09
|
Natural gas
production (bcf)
|
353.26
|
354.80
|
(0.43)
|
Refining
The Company, while focusing on profitability, optimised the
crude oil allocation and processing plans, adjusted the product
slate and utilisation rate, and increased the yield of high
value-added products, such as high-spec gasoline. We brought our
scale advantages into full play to control the unit cost. We
actively promoted the quality upgrading of refined oil products and
provide high standard fuels to the market. We took advantages of
specialised by improving our dedicated marketing network, we
optimised the sales of other refining products such as lubricants,
LPG, asphalt, etc. In the first half of 2015, we processed 119
million tonnes of crude oil, up by 2.7% compared with the first
half of 2014. Refined oil products output rose by 4.4% with jet
fuel and high-spec gasoline up by 18.9% and 18.2% respectively.
In the first half of 2015, operating revenue of the segment was
RMB485.7 billion, representing a
decrease of 25.5% over the same period of 2014.
In the first half of 2015, the refining margin (defined as sales
revenues less crude oil and refining feedstock costs and taxes
other than income tax, divided by the throughput of crude oil and
refining feedstock) was RMB 347.8 per
tonne, representing an increase of 15.8% over the same period of
2014. The segment improved the margin level of refined oil products
by promoting the oil products quality upgrade projects and
optimisation of product mix. The segment realized an operating
profit of RMB 15.3 billion in the
first half of 2015, representing an increase of 57% over the same
period of 2014.
Refining: Summary of
Operations
|
|
Six-month period
ended 30 June
|
Changes
|
2015
|
2014
|
(%)
|
Refinery throughput
(million tonnes)
|
118.89
|
115.81
|
2.66
|
Gasoline, diesel and
kerosene production
(million tonnes)
|
74.75
|
71.62
|
4.37
|
Gasoline (million
tonnes)
|
27.02
|
24.94
|
8.34
|
Diesel (million
tonnes)
|
35.82
|
36.67
|
(2.32)
|
Kerosene (million
tonnes)
|
11.90
|
10.01
|
18.88
|
Light chemical
feedstock production
(million tonnes)
|
19.07
|
19.96
|
(4.46)
|
Light yield
(%)
|
76.69
|
76.83
|
(0.14) percentage
points
|
Refining yield
(%)
|
94.98
|
94.63
|
0.35 percentage
points
|
Note: Includes 100%
of production of joint ventures.
|
Marketing and Distribution
In the first half of 2015, in light of the changes in supply and
demand, the Company optimised marketing structure to increase
retail volume and single station throughput. We accelerated the
transformation from an oil products supplier to a comprehensive
service provider by complimenting the rapid development of non-fuel
business with that of fuel business and achieving volume and profit
growth. In the first half of 2015, the total sales volume of
refined oil products grew by 5.3% to 92.97 million tonnes, of which
domestic sales were 83.92 million tonnes, up 3.6% from the same
period of previous year. Revenue from our non-fuel business reached
RMB 13.33 billion, an increase of
85.4% from the same period in 2014.
In the first half of 2015, the operating revenue of the segment
was RMB 565.6 billion, decreased by
22.2% over the same period of 2014, which was mainly due to the
decline of gasoline and diesel prices compared with same period of
2014. In the first half of 2015, the segment's operating profit was
RMB15.2 billion, representing a
decrease of RMB 3.6 billion over the
same period of 2014, mainly due to weak diesel demand and smaller
realised spread.
Marketing and
Distribution: Summary of Operations
|
|
Six-month period
ended 30 June
|
Changes
|
2015
|
2014
|
(%)
|
Total sales volume of
refined oil products (million tonnes)
|
92.97
|
88.26
|
5.34
|
Total domestic sales
volume of refined oil products (million tonnes)
|
83.92
|
81.04
|
3.55
|
Retail (million
tonnes)
|
58.19
|
56.55
|
2.90
|
Direct sales and
Wholesale (million tonnes)
|
25.73
|
24.49
|
5.06
|
Annualised average
throughput per station (tonne/station)
|
3,816
|
3,712
|
2.80
|
|
As of 30 June
2015
|
As of 31
December 2014
|
Change from
the end of
last year (%)
|
Total number of
Sinopec-branded service stations
|
30,514
|
30,551
|
(0.12)
|
Company-operated
|
30,501
|
30,538
|
(0.12)
|
Chemicals
In the first half of 2015, the Company further optimised
feedstock and product mix to achieve better cost efficiency. We put
our efforts in R&D, production and marketing of new products,
and maintained production volume growth in high value-added
products, the ratio of performance compound in synthetic resin and
differentiation rate of synthetic fiber rose to 57.7% and 81.0%
respectively, up by 1.4 and 2.4 percentage points compared with the
same period of last year. The chemical segment achieved better
performance by strengthening the coordination between production
and marketing. In the first half of 2015, ethylene production
reached 5.457 million tonnes, up 7.3% from the same period of last
year, and chemical sales volume was 30.3 million tonnes, up 3.8%
compared with the same period of last year.
In the first half of 2015, operating revenue of the chemicals
segment was RMB 166.3 billion,
representing a decrease of 22.1% over the same period of 2014,
which was mainly due to the decrease of chemical products prices
compared with the same period of 2014. The segment's operating
profit during the six-month period ended 30
June 2015 was RMB 10.1
billion, representing an increase of RMB 14.1 billion compared with the same period of
2014, mainly due to the segment's optimisation of products mix. At
the same time, the segment seized the opportunity of the recovery
of chemical products margin and improved the profitability.
Major Chemical
Products: Summary of Operations
|
Unit of production:
1,000 tonne
|
|
Six-month period
ended 30 June
|
Changes
|
2015
|
2014
|
(%)
|
Ethylene
|
5,457
|
5,084
|
7.34
|
Synthetic
resin
|
7,476
|
6,965
|
7.34
|
Synthetic fiber
monomer and polymer
|
4,322
|
4,105
|
5.29
|
Synthetic
fiber
|
638
|
646
|
(1.24)
|
Synthetic
rubber
|
453
|
483
|
(6.21)
|
Note: Includes 100%
of production of joint ventures.
|
Health, Safety and the Environment
In the first half of 2015, the Company fully implemented safety
responsibilities at all levels, conducted specific safety
inspections, and took identification and management on potential
hazards. We made optimal adjustments to emergency response system
and promoted HSE conformance. Hence we maintained work safety in
general. We pay close attention to environment protection, energy
saving, emission reduction as well as green and lowcarbon
development. We promoted Contract Energy Management and
construction of energy management system, and implemented "Clear
Waterand Blue Sky" program. Comparing to the same period last year,
the Company's energy intensity was down by 2.77%, COD in discharged
wastewater was down by 4.09%, SO2 emission was down by 4.84%, NOx
emission was down by 4.23%, Ammoniacal Nitrogen emission was down
by 3.91%.
Capital Expenditures
The Company focused on quality and profitability of business
expansions, and optimised its assets portfolio and investment. A
number of key projects have been well underway. CAPEX for the first
half was RMB 23.508 billion. CAPEX
for E&P was RMB 13.418 billion,
mainly for exploration and development in Shengli oil field, Tahe
oil field and Sichuan Basin, the
LNG projects in Guangxi and
Tianjin, pipeline boosting for Sichuan to East China Gas Transmission
Project, construction of pipelines exporting gas from Fuling shale
gas filed, Jinan-to-Qingdao Gas
Transmission Pipeline II Project, and overseas projects. CAPEX for
Refining was RMB 3.187 billion,
mainly for refinery revamping and gasoline and diesel quality
upgrading projects in Qilu and Jiujiang refineries. CAPEX for
Marketing and Distribution was RMB3.781
billion, mainly for developing and renovating service
stations, building oil products pipelines, oil depots and other
storage facilities, and specific projects for safety hazards
rectification and vapor recovery. We newly developed 207 service
stations in the first half of 2015. CAPEX for Chemicals was
RMB 2.519 billion, mainly for the
East Ningxia coal chemical project and the Wuhan ethylene project. CAPEX for Corporate
and Others was RMB 603 million,
mainly for R&D facilities and IT application projects.
Business Prospects
Looking into the second half, the world's economy is expected to
recover slowly. China's economy
will maintain its steady growth. With a general over supply
situation of international crude oil market, the oil price is
expected to fluctuate at a low level. Domestic demand for oil and
gas is anticipated to grow. The overall demand for oil products and
chemicals will grow steadily with the consumption mix to be further
adjusted. Given the current state, the Company will undertake
initiatives in the following key areas.
In exploration and development, we will step up new technology
development and application to promote progressive exploration and
reservoir evaluation in oilrich sag in East China, Tahe oil field
and the west rim of Junggar Basin. In natural gas development, we
will promote the development and assessment in the gas fields of
Erdos, Sichuan basin and Songliao
Basin, and push ahead with Fuling shale gas field development so as
to deliver the 1st phase capacity building target of 5
billion cubic meters. In the second half of the year, we expect to
produce 177 million barrels of crude oil and 537 billion cubic feet
of natural gas.
In refining, we will continue to adopt a market-oriented and
profitability-driven strategy, optimise production plan and ensure
safe and stable operations. We will fine-tune crude oil resources
allocation to lower crude cost, and accelerate oil products quality
upgrading. The Company will actively expand marketing of
lubricants, LPG and asphalt. Meanwhile, we will actively control
costs to improve cost competitiveness. We plan to process 122.7
million tonnes of crude oil in the second half.
In marketing and distribution, we will intensify market analysis
and forecast to ensure both sales volume growth and profitability,
optimise resource structure to consolidate and expand market share,
and put customers first by adopting more proactive retail
strategies to stabilise direct sales and distribution volume. We
will continuously push forward a market-oriented and specialised
development in non-fuel business, strengthen key products marketing
and procurement management, and promote transformation from an oil
products supplier to a comprehensive service provider. In the
second half, we plan to sell 87 million tonnes of refined oil
products in the domestic market.
In chemicals, we will proactively adjust the product mix,
promote new products R&D in line with expanded production and
sales. We will fine-tune the operations of facilities at reasonable
utilisation rate and continuously to reduce optimise feedstock mix
cost. Meanwhile, we will deepen the inter links amongst production,
marketing, research and product application, enhance our marketing
strategy and improve customer services. In the second half, we plan
to produce 5.6 million tonnes of ethylene.
In the second half, we'll fully leverage our advantages across
the integrated value chain, arrange production and operation for
maximum profitability, spare no efforts in expanding market, and
intensely keep the cost and expenses under control. We will ensure
HSE performance, strengthen our capability in sustainable
development and strive for better operating results. In the
meantime, we will adapt to and capture the opportunities of the new
normals of Chinese economic growth, and set forth the
13th five-year plan of the company.
Appendix: Key financial data and
indicators
FINANCIAL DATA AND INDICATORS PREPARED IN ACCORDANCE WITH
ASBE
Principal accounting
data
|
Items
|
Six-month periods
ended 30 June
|
Changes over the
same
period of the
preceding year
(%)
|
2015
RMB
million
|
2014
RMB
million
|
Operating
income
|
1,040,362
|
1,356,172
|
(23.3)
|
Net profit
attributable to equity shareholders of the Company
|
24,427
|
31,430
|
(22.3)
|
Net profit
attributable to equity shareholders of the
Company after deducting
extraordinary gain/loss items
|
23,431
|
31,354
|
(25.3)
|
Net cash flows from
operating activities
|
67,442
|
58,214
|
15.9
|
|
At 30 June
2015
RMB
million
|
At 31 December
2014
RMB
million
|
Change from the
end of last
year(%)
|
Total equity
attributable to equity shareholders of the Company
|
681,474
|
594,483
|
14.6
|
Total
assets
|
1,470,355
|
1,451,368
|
1.3
|
Principal financial
indicators
|
Items
|
Six-month periods
ended 30 June
|
Changes
over the same
period of the
preceding year
(%)
|
2015
RMB
|
2014
RMB
|
Basic earnings per
share
|
0.202
|
0.269
|
(24.9)
|
Diluted earnings per
share
|
0.202
|
0.268
|
(24.6)
|
Basic earnings per
share after deducting extraordinary gain/loss items
|
0.194
|
0.269
|
(27.9)
|
Weighted average
return on net assets (%)
|
3.81
|
5.37
|
(1.56) percentage
points
|
Weighted average
return on net assets
after deducting extraordinary gain/loss
items (%)
|
3.66
|
5.36
|
(1.70) percentage
points
|
FINANCIAL DATA AND INDICATORS PREPARED IN ACCORDANCE WITH
IFRS
Principal accounting
data
|
Items
|
Six-month periods
ended 30 June
|
Changes over the
same
period of the
preceding year
(%)
|
2015
RMB
million
|
2014
RMB
million
|
Operating
Profit
|
40,543
|
52,268
|
(22.4)
|
Net profit
attributable to owners
of the Company
|
25,394
|
32,543
|
(22.0)
|
Net cash generated
from
operating activities
|
67,442
|
58,214
|
15.9
|
|
At 30 June
2015
RMB
million
|
At 31 December
2014
RMB
million
|
Change from the
end of last year
(%)
|
Equity attributable
to owners of
the Company
|
680,085
|
593,041
|
14.7
|
Total
assets
|
1,470,355
|
1,451,368
|
1.3
|
Principal financial
indicators
|
Items
|
Six-month periods
ended 30 June
|
Changes over the
same
period of the
preceding year
(%)
|
2015
RMB
|
2014
RMB
|
Basic earnings per
share
|
0.211
|
0.279
|
(24.4)
|
Diluted earnings per
share
|
0.211
|
0.277
|
(23.8)
|
Return on capital
employed (%)
|
3.46
|
4.19
|
(0.73) percentage
points
|
The following table sets forth the operating revenues, operating
expenses and operating profit/(loss) by each segment before
elimination of the inter-segment transactions for the periods
indicated, and the percentage changes between the first half of
2015 and the first half of 2014.
|
Six-month periods
ended 30 June
|
Changes
|
2015
|
2014
|
RMB
million
|
(%)
|
Exploration and
Production Segment
|
|
|
|
Operating
revenues
|
70,401
|
113,827
|
(38.2)
|
Operating
expenses
|
72,227
|
85,564
|
(15.6)
|
Operating
(loss)/profit
|
(1,826)
|
28,263
|
-
|
Refining
Segment
|
|
|
|
Operating
revenues
|
485,735
|
651,969
|
(25.5)
|
Operating
expenses
|
470,415
|
642,214
|
(26.8)
|
Operating
(loss)/profit
|
15,320
|
9,755
|
57.0
|
Marketing and
Distribution Segment
|
|
|
|
Operating
revenues
|
565,638
|
726,927
|
(22.2)
|
Operating
expenses
|
550,450
|
708,133
|
(22.3)
|
Operating
(loss)/profit
|
15,188
|
18,794
|
(19.2)
|
Chemicals
Segment
|
|
|
|
Operating
revenues
|
166,306
|
213,392
|
(22.1)
|
Operating
expenses
|
156,203
|
217,360
|
(28.1)
|
Operating
(loss)/profit
|
10,103
|
(3,968)
|
-
|
Corporate and
others
|
|
|
|
Operating
revenues
|
415,790
|
645,690
|
(35.6)
|
Operating
expenses
|
415,014
|
645,951
|
(35.8)
|
Operating
(loss)/profit
|
776
|
(261)
|
-
|
Elimination of
inter-segment profit/(loss)
|
982
|
(315)
|
-
|
About Sinopec Corp.
Sinopec Corp. is one of the largest integrated energy and
chemical companies in China. Its
principal operations include the exploration and production,
pipeline transportation and sale of petroleum and natural gas; the
sale, storage and transportation of petroleum products,
petrochemical products, coal chemical products, synthetic fibre,
fertiliser and other chemical products; the import and export,
including an import and export agency business, of petroleum,
natural gas, petroleum products, petrochemical and chemical
products, and other commodities and technologies; and research,
development and application of technologies and information.
Sinopec sets 'fueling beautiful life' as its corporate mission,
puts 'people, responsibility, integrity, precision, innovation and
win-win' as its corporate core values, pursues strategies of
resources, markets, integration, international operation,
differentiation, and green and low-carbon development, and strives
to achieve its corporate vision of building a world leading energy
and chemical company.
Disclaimer
This press release includes "forward-looking statements". All
statements, other than statements of historical facts that address
activities, events or developments that Sinopec Corp. expects or
anticipates will or may occur in the future (including but not
limited to projections, targets, reserve volume, other estimates
and business plans) are forward-looking statements. Sinopec Corp.'s
actual results or developments may differ materially from those
indicated by these forward-looking statements as a result of
various factors and uncertainties, including but not limited to the
price fluctuation, possible changes in actual demand, foreign
exchange rate, results of oil exploration, estimates of oil and gas
reserves, market shares, competition, environmental risks, possible
changes to laws, finance and regulations, conditions of the global
economy and financial markets, political risks, possible delay of
projects, government approval of projects, cost estimates and other
factors beyond Sinopec Corp.'s control. In addition, Sinopec Corp.
makes the forward-looking statements referred to herein as of today
and undertakes no obligation to update these statements.
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SOURCE China Petroleum & Chemical Corporation