EQS Newswire / 26/10/2023 / 20:10 UTC+8
(For immediate release)
Sinopec Achieved High-Quality Operating Results in 3Q 2023
Continuously Implemented Share Repurchase Program
(26 October 2023, Hong Kong, China) China Petroleum & Chemical Corporation (“Sinopec Corp.” or “the Company”) (HKEX: 00386; SSE: 600028) today announced its unaudited results for the nine months ended 30 September 2023.
In the first three quarters of 2023, China’s economy continued to recover and showed a good momentum, with its GDP grew by 5.2% year-on-year. International oil prices fluctuated downwards in the first half of 2023, and rose rapidly in the third quarter. The average spot price of Platts Brent was USD82.1 per barrel, down by 19.9% year-on-year. Based on the statistics of the Company, domestic natural gas demand grew steadily with apparent consumption up by 6.4% year-on-year. Domestic demand for refined oil products rebounded with apparent consumption up by 15.1% year-on-year; of which, gasoline, diesel and kerosene consumption increased by 20.4%, 4.3% and 68.6% respectively. Domestic demand for chemicals picked up with ethylene equivalent consumption up by 6.0% year-on-year.
The Company gave full play to the advantages of its integrated business, actively responded to market changes, carried out in-depth optimization of the whole industrial chain, enhanced production and marketing coordination and achieved high-quality operating results. In accordance with CASs, net profit attributable to equity shareholders of the Company in the first three quarters was RMB 52.966 billion, down by 7.5% year-on-year; that for the third quarter was RMB 17.855 billion, up by 34.0% year-on-year. In accordance with IFRS, profit attributable to shareholders of the Company in the first three quarters was RMB 54.060 billion, down by 6.6% year-on-year; that for the third quarter was RMB 17.938 billion, up by 37.7% year-on-year.
Exploration and Production: The Company intensified efforts in high quality exploration and profitable development with sound achievements made in increasing reserves, stabilizing oil production, boosting gas output and cutting cost. In terms of exploration, we strengthened risk exploration in new regions and areas and integrated evaluation exploration, and achieved a number of oil and gas discoveries and breakthroughs in Tarim Basin and Junggar Basin etc. The construction of Shengli Jiyang Shale Oil National Demonstration Zone was moving forward efficiently. In terms of development, we continued to scale up profitable production, carried forward the capacity building of Jiyang, Tahe and West Junggar, and deepened fine-tuned development of mature oil fields. Efforts were made to bring up reserve and production of natural gas and accelerate capacity building in Shunbei Zone II and West Sichuan marine facies gas field. We strengthened integrated operation of natural gas production, supply, storage and sales, and improved the profitability of the whole natural gas business chain. The Company’s production of oil and gas in the first three quarters was 376.15 million barrels of oil equivalent, up by 3.6% year-on-year, among which natural gas production reached 992.98 billion cubic feet, up by 8.7% year-on-year. The exploration and production segment realised EBIT of RMB 41.620 billion in the first three quarters, including RMB 14.700 billion in the third quarter.
Conversion: For domestic production of crude oil, 1 tonne = 7.1 barrels. For overseas production of crude oil, 1 tonne = 7.26 barrels. For production of natural gas, 1 cubic meter = 35.31 cubic feet.
Refining: The Company adhered to the integration and optimization of production and marketing, increased utilization rate and total processing volume, and maximized the performance of the business chain. We dynamically enhanced resources allocation and lowered procurement cost. We closely followed market demand, effectively optimised the rhythm of converting refined oil products to chemical feedstock and refining specialties, and increased production of marketable products such as high-grade lubricating oil and grease. We scaled up export volume and optimized export schedule and structure. In the first three quarters, the Company processed 193.74 million tonnes of crude oil, up by 7.6% year-on-year, and produced 117.52 million tonnes of refined oil products, up by 14.0%. The refining segment realised EBIT of RMB 18.700 billion in the first three quarters, including RMB 7.509 billion in the third quarter.
Note : Including 100% production of domestic joint ventures.
Marketing and Distribution: The Company seized the favorable opportunity from a rebound in market demand, brought our advantages of integrated business into full play, made full efforts to expand the market, and further enhanced the operating quality and scale. Active measures were taken to promote the expansion of charging and battery swapping business, expand application scenario of hydrogen business, and transform into an integrated energy service provider of petrol, gas, hydrogen, power and services. At the same time, we reinforced efforts in upgrading Sinopec-branded products and explored new business models to improve the quality and profitability of non-fuel business. Total sales volume of refined oil products for the first three quarters of the year was 180.55 million tonnes, up by 19.1% year-on-year, among which total domestic sales volume was 142.61 million tonnes, up by 16.9% year-on-year. The marketing and distribution segment realised EBIT of RMB 26.528 billion in the first three quarters, including RMB 8.126 billion in the third quarter.
Note: The total sales volume of refined oil products includes the amount of refined oil marketing and trading sales volume.
Chemicals: Facing difficult situation of fast release of new capacities, the Company increased output of profitable products, strengthened cost control, and made full efforts to enhance profit. Integration of production, marketing, research and application was further cemented to steadily increase portion of high value-added products. In the first three quarters, ethylene production was 10.662 million tonnes, up by 6.6% year-on-year. The Company actively expanded domestic and overseas markets, and made full efforts to increase market sales volume and profit. The total chemical sales volume in the first three quarters reached 63.43 million tonnes, up by 5.0% year-on-year. The chemicals segment realised EBIT of RMB -6.707 billion in the first three quarters, and returned to profitability in the third quarter with EBIT of RMB 59 million.
Note : Including 100% production of domestic joint ventures.
Capital expenditures: In the first three quarters, total capital expenditures were RMB 108.164 billion. Capital expenditure for the exploration and production segment was RMB 50.711 billion, mainly for oil and gas production capacity construction of Jiyang and West Sichuan and storage and transportation facilities etc. Capital expenditure for the refining segment was RMB 10.524 billion, mainly for refining structural adjustment in Yangzi. RMB 5.671 billion was spent in marketing and distribution segment, mainly for the development of integrated energy station network, renovation of the existing end-market network and non-fuel business. Capital expenditure for the chemical segment was RMB 39.143 billion, mainly for ethylene projects in Zhenhai and Tianjin Nangang as well as coal chemical projects; RMB 2.115 billion was spent in corporate and others, mainly for R&D facilities and information technology application projects.
Principal financial data and indicators prepared in accordance with CASs
Note: In 2023, the Company adopted the requirement of the Interpretation of Accounting Standards for Business Enterprises No.16 that “the accounting treatment of exemption from initial recognition does not apply to the deferred tax related to the assets and liabilities arising from a single transaction”, and retrospectively adjusted the accounting treatments of applicable transactions which happened from 1 January 2022 to the first effective date.
Principal financial data and indicators prepared in accordance with IFRS
Note: In 2023, the Company adopted the requirement of the International Accounting Standard No.12, deferred tax related to assets and liabilities arising from a single transaction, that “accounting treatment of deferred tax related to assets and liabilities arising from a single transaction for which initial recognition exemption does not apply”, and has retrospectively adjusted the accounting treatments of applicable transactions which happened from the earliest comparative period.
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 production, sale, storage and transportation of refinery products, petrochemical products, coal chemical products, synthetic fibre, 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; hydrogen energy business and related services such as hydrogen production, storage, transportation and sales; battery charging and swapping, solar energy, wind energy and other new energy business and related services.
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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26/10/2023 Dissemination of a Financial Press Release, transmitted by EQS News.
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