Sinopec profit slumps 25pc to 31b yuan

Business | Reuters and Avery Chen 26 Aug 2019

China Petroleum and Chemical Corp (0386), known as Sinopec, reported a 24.7 percent drop in first-half net profit to 31.34 billion yuan (HK$34.64 billion), dampened by rapid growth of domestic refining capacity and waning demand for refined products.

An interim dividend of 12 fen was declared, 25 percent lower than a year before. Basic earnings per share was 26.6 fen. First-half turnover and other operating revenues increased by 15.3 percent year-on-year to 1.5 trillion yuan.

While domestic demand for refined oil products maintained steady growth, the market witnessed strong competition with abundant supply. Refining margins at Chinese refiners were cut after the start-up of two mega-sized plants, Hengli Petrochemicals and Zhejiang Petrochemical, with a combined capacity of nearly 800,000 barrels per day.

Average profit margins of oil refining at Sinopec were reported to be 383 yuan a tonne in the first half, dropping 161 yuan a tonne, or 29.6 percent year-on-year.

Oil throughput at Sinopec was at 123.92 million tonnes in the reported period, increasing 2.7 percent year-on-year.

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