Sinopec Corp.(00386)2024-08-25 10:20Financial Performance - For the six months ended June 30, 2024, the operating revenue was RMB 1,576,131 million, a decrease of 1.1% compared to RMB 1,593,682 million in the same period of 2023[7]. - The net profit attributable to shareholders of the parent company was RMB 35,703 million, representing an increase of 1.7% from RMB 35,111 million year-on-year[7]. - The net cash flow from operating activities increased significantly by 53.4% to RMB 42,269 million, compared to RMB 27,562 million in the previous year[7]. - The total assets as of June 30, 2024, were RMB 2,141,936 million, reflecting a growth of 5.7% from RMB 2,026,674 million at the end of 2023[7]. - The basic earnings per share for the first half of 2024 was RMB 0.296, up 1.0% from RMB 0.293 in the same period of 2023[8]. - The weighted average return on net assets was 4.37%, a slight decrease of 0.06 percentage points compared to 4.43% in the previous year[8]. - The company reported a significant increase in net profit after deducting non-recurring gains and losses, which rose by 5.7% to RMB 35,582 million from RMB 33,655 million year-on-year[7]. - The company achieved a net profit of RMB 42.39 billion in the first half of 2024, an increase of 1.9% compared to the same period in 2023[35]. - The company reported a total comprehensive income of RMB 35,382 million for the six months ended June 30, 2024, compared to RMB 40,476 million for the same period in 2023, indicating a decrease of about 12.5%[170]. Revenue and Sales - Total operating income for the first half of 2024 was RMB 51,021 million, a decrease of 5.0% compared to RMB 53,696 million in the same period of 2023[13]. - The company’s external sales revenue from the refining and marketing divisions reached RMB 920.4 billion, a year-on-year decrease of 0.6%, accounting for 58.4% of total revenue[39]. - Sales revenue from gasoline, diesel, and kerosene amounted to RMB 769.9 billion, a year-on-year increase of 0.2%, representing 83.6% of total petroleum product sales revenue[39]. - The company reported a 3.4% increase in revenue from exports of crude oil and natural gas, totaling RMB 92.7 billion in the first half of 2024[38]. - The marketing and distribution segment aims for a domestic refined oil sales volume of 91.09 million tons in the second half of 2024[31]. Operating Expenses and Costs - Operating expenses for the first half of 2024 were RMB 1,525.1 billion, a year-on-year decrease of 1.0%[40]. - The cost of purchasing crude oil was RMB 468 billion, a year-on-year increase of 5.0%, with an average processing cost of RMB 4,445 per ton, up 6.3% year-on-year[40]. - The company’s financial expenses increased by 31.0% to RMB 6,275 million, primarily due to increased foreign currency loan losses and higher interest expenses[12]. - The company reported a significant increase in accounts receivable, which rose to RMB 76,746 million from RMB 48,652 million, marking a growth of about 57.7%[164]. Investments and Capital Expenditures - Capital expenditures for the first half of 2024 amounted to RMB 55.893 billion, with RMB 33.788 billion allocated to exploration and development projects[30]. - The company plans to produce 139 million barrels of crude oil and 6,795 billion cubic feet of natural gas in the second half of 2024[31]. - Capital expenditures for the second half of 2024 are planned at RMB 117.1 billion, with RMB 44 billion allocated for exploration and development[32]. - The company has completed an investment of RMB 25.9 billion in the Zhenhai Refining and Chemical Expansion Project (Phase II) as of June 30, 2024, which includes a new 11 million tons/year refining unit and a 600,000 tons/year propane dehydrogenation unit[109]. Dividends and Shareholder Returns - The company plans to distribute a mid-term cash dividend of 0.146 RMB per share for 2024, adhering to the upper limit set by the company's articles of association[15]. - The board has proposed a cash dividend payout ratio of no less than 65% for the next three years, ensuring consistent shareholder returns[17]. - The cash dividend for the year-end 2023 is set at RMB 0.2 per share (tax included), with a total cash dividend distribution of RMB 0.345 per share for the entire year 2023[86]. - The interim dividend for the six months ending June 30, 2024, is set at RMB 0.146 per share, with a total payout scheduled for September 26, 2024[87]. Environmental and Sustainability Efforts - The company is committed to improving ESG management and promoting sustainable development through enhanced governance and risk control measures[16]. - The company reported a 4% year-on-year reduction in COD emissions and a 3% decrease in sulfur dioxide emissions during the reporting period[94]. - The company achieved a reduction of 2.149 million tons of CO2 equivalent emissions through energy-saving measures and recovered 1.062 million tons of CO2[95]. - The second phase of Sinopec's green enterprise action plan aims for a 5% reduction in carbon emission intensity and a 20% reduction in methane emission intensity by 2028, with a target of capturing and utilizing 2.5 million tons of CO2 annually[96]. Corporate Governance and Management - The company completed the election of the ninth board of directors and supervisory board members during the annual general meeting held on June 28, 2024[82]. - The company has strengthened internal control and risk management, continuously improving compliance management levels[81]. - The company appointed Zhao Dong as the new president and executive director on April 28, 2024, following the resignation of the previous president[83]. - The company has diversified its board members in terms of professional background, gender, and work experience[81]. Research and Development - Research and development expenses for the first half of 2024 amounted to RMB 9.8 billion, with RMB 6 billion in expenses and RMB 3.8 billion in investment[70]. - The company is focusing on innovation-driven strategies, particularly in key technologies and the development of new energy sources such as hydrogen and solar energy[16]. Risk Management - The company faces risks related to macroeconomic changes, including uncertainties from global economic growth and environmental constraints[143]. - The company is exposed to cyclical risks in the oil and petrochemical industry, with significant sensitivity to macroeconomic conditions and consumer demand[143]. - The company has implemented strict HSE management systems to mitigate production and operational risks associated with the high-risk nature of the oil and petrochemical industry[145]. Share Capital and Financing - Sinopec completed the issuance of 2,390,438,247 A-shares, increasing the total share capital from 119,349,251,646 shares to 121,739,689,893 shares[123]. - The total amount of funds raised was RMB 12 billion, with a net amount after expenses of RMB 11.987 billion, and 11% of the committed investment has been utilized[124]. - The company issued short-term financing bonds totaling RMB 120 billion with an interest rate of 1.97%[158]. Cybersecurity - The company has established a cybersecurity risk management system and is continuously investing resources to enhance its cybersecurity measures[146]. - The company is expected to increase investments in data security, business security, cloud computing, and IoT devices to improve cybersecurity levels[146].