DJ EQS-News: Sinopec's Net Profit for 2020 Q3 Reached RMB 23.507 Billion Campaign of Continuously Tiding Over Difficulties and Improving Performances Achieves Favorable Results with Significant Improvement of Operation and Profitability
EQS-News / 29/10/2020 / 10:43 UTC+8
Press release
(For immediate release)
Sinopec's Net Profit for 2020 Q3 Reached RMB 23.507 Billion
Campaign of Continuously Tiding Over Difficulties and Improving Performances
Achieves Favorable Results with Significant Improvement of Operation and
Profitability
(28 October 2020, Hong Kong, China) China Petroleum & Chemical Corporation
("Sinopec Corp." or the "Company") (HKEX: 00386; SSE: 600028; NYSE: SNP)
today announced its unaudited results for the nine months ended 30 September
2020.
Financial Highlights
- In accordance with the CAS, the Company's operating income in the first
three quarters was 1.5546 trillion and net profit attributable to equity
shareholders of the Company was 23.507 billion. In accordance with IFRS,
net profit attributable to shareholders of the Company was RMB 24.459
billion and the basic earnings per share were RMB 0.202.
- In the third quarter, the Company achieved significant improvement of
operating and profitability. Oil and gas production, refinery throughput,
total domestic sales volume of refined oil products and total chemical
products sales volume recorded quarter on quarter increase and operating
profit was 26.53 billion, representing a year on year increase of 38.2%.
- In accordance with IFRS, the Company's liability-to-asset ratio as of 30
September 2020 was 51.7%, maintaining a sound financial position. Net cash
generated from operating activities up by 2.8% year on year. Cash and cash
equivalents amounted to RMB 87.086 billion as at 30 September 2020.
Operating Review
In the first three quarters of 2020, due to the worldwide spread of
COVID-19, global economy was depressed and the global market was shrinking.
The growth of China's economy turned positive, with GDP up by 0.7%
year-on-year in the first three quarters, among which up by 4.9% in the
third quarter, indicating a good continuous recovery momentum. In the first
three quarters of 2020, the average spot price of Platts Brent was USD 42.5
per barrel, down by 34.4% year on year. Domestic demand for natural gas and
chemical products maintained growth and demand for refined oil products
recovered steadily quarter on quarter.
Confronted with the severe and complex market situation, the Company adhered
to the principles of "focusing on main challenges, system optimization,
bottom-line risks prevention and control and seizing opportunities out of
crisis" and vigorously adjusted structure, expanded market, reduced
inventory and tapped potential. On the basis of favorable results of
"100-day campaign to tide over difficulties and improve performances", the
Company launched a higher standard campaign of continuously tiding over
difficulties and improving performances, seized the opportunity of domestic
market demand recovery and made all-out efforts to tide over the
difficulties of pandemic along with low crude oil price and achieved
significant improvement of operation and profitability. The Company
completed the transaction of oil and gas pipeline assets on 30 September
2020 and the contribution of asset appreciation to earnings was booked in
the third quarter.
Exploration and Production: Under low crude oil price environment, the
Company insisted on high-quality exploration, focused on profit-driven
development, accelerated capacity building and proactively expanded market
and sales of natural gas and further deepened the maintaining oil
production, increasing gas output and reducing cost. In exploration, new
discoveries were made in Tarim Basin, Jiyang Depression and Sichuan Basin,
etc. In oil development, we increased the application of technologies to
lower cost and optimized projects implementation plan, which helped to
further decrease our cost. In natural gas development, we accelerated
capacity building in West Sichuan, Dongsheng and Weirong gas fields, and
continuously progressed with the development of Fuling, Puguang and Yuanba
gas fields. In the first three quarters, domestic crude production kept
stable and sales of natural gas increased by 9.86% year on year, realizing a
continued growth in market share of natural gas. The exploration and
production segment realised earnings before interest and taxes (EBIT) of RMB
13.16 billion in the third quarter.
Exploration Unit Nine-month period ended 30 Changes
and September
Production
2020 2019 (%)
Oil and gas million boe 339.39 341.74 (0.7)
production
Crude oil million 210.65 212.78 (1.0)
production barrels
China million 186.69 186.69 0.0
barrels
Overseas million 23.96 26.09 (8.2)
barrels
Natural gas billion 772.14 773.41 (0.2)
production cubic feet
Realised USD/barrel 38.24 58.82 (35.0)
crude oil
price
Realised USD/thousand 5.32 6.19 (14.1)
natural gas cubic feet
price
Conversion: For domestic production of crude oil, 1 tonne = 7.10 barrels.
For overseas production of crude oil, 1 tonne = 7.21 barrels. For production
of natural gas, 1 cubic meter = 35.31 cubic feet.
Refining: With the market oriented approach, the Company took advantage of
the recovery of domestic demand in the third quarter, further integrated
production and marketing, maintained high utilization rates of facilities
and maximized the profitability of value chain. We dynamically adjusted
product mix, increased the supply of chemical feedstock and increased
production of asphalt, lubricant and other marketable products. We optimized
crude oil procurement and decreased cost. In the third quarter, refinery
throughput was 63.51 million tonnes, up by 11.0% quarter on quarter and 1.9%
year on year and 38.01 million tonnes of refined oil products were produced,
representing a quarter-on-quarter increase of 11.2%, and 10.53 million
tonnes of light chemical feedstock were produced, representing a quarter-on
quarter increase of 15.0% and a year-on-year increase of 5.3%. The refining
segment realized EBIT of RMB 31.55 billion in the third quarter.
Refining Unit Nine-month period ended 30 Changes
September
(%)
2020 2019
Refinery million 174.46 186.26 (6.3)
throughpu tonnes
t
Gasoline, million 105.19 119.54 (12.0)
diesel tonnes
and
kerosene
productio
n
Gasoline million 42.46 47.20 (10.0)
tonnes
Diesel million 47.86 49.01 (2.3)
tonnes
Kerosene million 14.87 23.33 (36.3)
tonnes
Light million 29.54 30.05 (1.7)
chemical tonnes
feedstock
productio
n
Light % 74.63 76.44 (1.81)
product
yield
percentage
points
Refining % 94.89 94.99 (0.10)
yield
percentage
points
Note: Including 100% production of domestic joint ventures.
Marketing and Distribution: Facing fierce market competition, the Company
strengthened market analysis, leveraged the advantages of integration,
balanced volume and profit, expanded sales and increased profit, and
achieved continuous recovery in sales volume. We innovated marketing model
by introducing the "one click refueling", etc., promoted the integration of
online and offline business, created a new service model of reducing
physical contact while refueling and shopping in a more efficient and
convenient way to constantly improve our services. In the third quarter,
domestic sales volume of refined oil products was 45.44 million tonnes, up
by 0.4% quarter on quarter. The marketing and distribution segment realized
EBIT of RMB 18.24 billion in the third quarter.
Marketing Unit Nine-month period ended 30 Changes
and September
Distributi
on
(%)
2020 2019
Total million tonnes 162.25 192.42 (15.7)
sales
volume of
refined
oil
products
Total million tonnes 123.19 139.25 (11.5)
domestic
sales
volume of
refined
oil
products
Retail million tonnes 83.06 91.80 (9.5)
Direct million tonnes 40.13 47.45 (15.4)
sales &
Distributi
on
Annualised tonnes/station 3,605 3,991 (9.7)
average
throughput
per
station
Note: The total sales volume of refined oil products includes the amount of
trading volume.
Chemicals: The Company fine-tuned chemical feedstock mix to further lower
costs, optimized operation and product slate, increased the ratio of high
value-added products with the ratio of new and specialty synthetic resin
reaching 68.6% and ratio of high value-added synthetic rubber reaching
31.3%. Construction of key projects was accelerated. In the third quarter,
(MORE TO FOLLOW) Dow Jones Newswires
October 28, 2020 22:43 ET (02:43 GMT)
DJ EQS-News: Sinopec's Net Profit for 2020 Q3 -2-
ethylene output was 3.07 million tonnes, up by 11.8% quarter-on-quarter. We
accelerated expanding high-end products market, such as medical resin,
antibacterial materials and automotive material etc. and optimized layout
and logistics operation to enhance profitability of business chain. In the
third quarter, the total chemical sales volume was 22.33 million tonnes, up
by 0.86% quarter on quarter. The chemical segment realized EBIT of RMB 4.22
billion in the third quarter.
Chemicals Unit Nine-month period ended 30 September Changes
(%)
2020 2019
Ethylene thousand 8,850 9,295 (4.8)
tonnes
Synthetic thousand 12,773 12,749 0.2
resin tonnes
Monomers thousand 6,711 7,511 (10.7)
and tonnes
polymers
for
synthetic
fibre
Synthetic thousand 935 968 (3.4)
fibre tonnes
Synthetic thousand 790 794 (0.5)
rubber tonnes
Note: Including 100% production of domestic joint ventures.
Capital expenditure: Focusing on quality and profitability of investment,
the Company continuously optimised our investment projects. In the first
three quarters, total capital expenditures were RMB 71.858 billion. Capital
expenditures for the exploration and production segment were RMB 32.172
billion, mainly for capacity building in Shengli, Northwest, West Sichuan
and Dongsheng oil and gas projects. Capital expenditures for the refining
segment were RMB 13.819 billion, mainly for Zhongke project, Zhenhai,
Tianjin, Maoming and Luoyang refining upgrading projects. Capital
expenditures for the marketing and distribution segment were RMB 13.768
billion, mainly for construction of service stations, oil products depots
and non-fuel business development. Capital expenditures for the chemicals
segment were RMB 10.458 billion, mainly for Zhongke, Zhenhai, and Gulei,
ethylene revamping for Sinopec-SK and Jiujiang aromatics projects, and melt
blown fabrics projects. Capital expenditures for corporate and others were
RMB 1.641 billion, mainly for R&D facilities and IT application projects.
Appendix: Principal financial data and indicators
Principal financial data and indicators prepared in accordance with CASs
Units: RMB million
Items As of 30 As of 31 Changes from the
September December end of the
preceding year
to the end of
the reporting
2020 2019 period (%)
Total assets 1,799,388 1,755,071 2.5
Total equity 729,179 739,169 (1.4)
attributable to
equity
shareholders of
the Company
7-9' 2020 Year-on-year(%) 1-9' 2020 Year-on-year(%)
Net cash 43,845 (9.6) 83,639 2.8
flow from
operating
activities
Operating 520,371 (29.1) 1,554,617 (30.4)
income
Net profit 46,389 288.4 23,507 (45.7)
attributable
to equity
shareholders
of the
Company
Net profit 14,147 27.5 (10,257) -
attributable
to equity
shareholders
of the
Company
excluding
extraordinar
y gains and
losses
Basic 0.383 288.4 0.194 (45.7)
earnings per
share (RMB)
Principal financial data and indicators prepared in accordance with IFRS
Units: RMB million
Items As of 30 As of 31 Changes from the
September December end of the
preceding year
to the end of
the reporting
2020 2019 period (%)
Total assets 1,799,388 1,755,071 2.5
Total equity 728,198 738,150 (1.3)
attributable to
shareholders of
the Company
7-9' 2020 Year-on-year(%) 1-9' 2020 Year-on-year(%)
Net cash 43,845 (9.6) 83,639 2.8
generated
from
operating
activities
Operating 26,529 38.2 5,028 (92.6)
profit
Net profit 46,184 284.2 24,459 (44.7)
attributable
to
shareholders
of the
Company
Basic 0.381 284.2 0.202 (44.7)
earnings per
share (RMB)
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 value-orientation,
innovation-driven development, integrated resource allocation, open
cooperation, and green and low-carbon growth, 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.
Investor Inquiries: Media Inquiries:
Beijing
Tel:(86 10) 5996 0028 Tel:(86 10) 5996 0028
Fax:(86 10) 5996 0386 Fax:(8610) 5996 0386
Email:ir@sinopec.com Email:ir@sinopec.com
Hong Kong
Tel:(852) 2824 2638 Tel:(852) 2522 1838
Fax:(852) 2824 3669 Fax:(852) 2521 9955
Email:ir@sinopechk.com Email:sinopec@prchina.com.hk
File: Sinopec's Net Profit for 2020 Q3 Reached RMB 23.507 Billion Campaign
of Continuously Tiding Over Difficulties and Improving Performances Achieves
Favorable Results with Significant Improvement of Operation and
Profitability [1]
29/10/2020 Dissemination of a Marketing Press Release, transmitted by EQS
Group.
The issuer is solely responsible for the content of this announcement.
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October 28, 2020 22:43 ET (02:43 GMT)
