HONG KONG, March 16, 2016 /PRNewswire/ -- Sinopec Shanghai
Petrochemical Company Limited ("Shanghai Petrochemical" or the
"Company") (HKEx: 00338; SSE: 600688; NYSE: SHI) today announced
the audited operating results of the Company and its subsidiaries
(the "Group") prepared under International Financial Reporting
Standards ("IFRS") for the year ended 31
December 2015 (the "Year").
According to IFRS, revenue of the Group for the Year amounted to
RMB 80,748.1 million, representing a
decrease of 20.93% over the previous year. The Company has achieved
a successful turnaround from loss, with a net profit attributable
to owners of the Company amounting to RMB
3,274.3 million (2014: net loss attributable to owners of
the Company of RMB 692.2 million).
Basic earnings per share amounted to RMB
0.303 (2014: basic loss per share of RMB 0.064 based on the Company's total issued
share capital of 10.8 billion shares). The Board of Directors
recommended the distribution of cash dividend in respect of the
year ended 31 December 2015 of
RMB 1.00 (VAT inclusive) for every 10
shares to all shareholders for the Year (2014: Nil).
Mr. Wang Zhiqing, Chairman of Shanghai Petrochemical, said, "In
2015, in view of the intensifying economic downward pressure and
overwhelming problem of structural overcapacity, the Chinese
government implemented a series of adjustment measures and reform
initiatives to stabilize economic growth. Overall, the Chinese
economy was stable, with an annual GDP growth of 6.9%, but the
economic growth rate further slowed down. In terms of the
petrochemical industry in China,
the price of bulk petrochemical products remained weak in a low oil
price environment, investments in the industry declined, and
structural problems associated with the overcapacity of
petrochemical products remained overwhelming and restrictions on
resources, environmental protection and safety became tighter.
However, compared with the significant drop in oil price, the
decline in prices for downstream products was relatively small,
there were increases in the profit on such products and the returns
of the industry increased and stabilized. Amidst complicated and
ever-changing market conditions in 2015, the Group focused on
efficiency, and made great strides in safety and environmental
protection standards, in optimizing production and operations as
well as in cutting costs and expenses. It maintained smooth and
stable production and operations, and significantly enhanced
economic returns.
In 2015, the Group's net sales amounted to RMB 67,037.2 million, representing a decrease of
27.70% year-on-year. Of which, net sales of synthetic fibres,
resins and plastics, intermediate petrochemicals, petroleum
products and trading of petrochemical products decreased by
19.48%, 19.99%, 24.69%,
37.47% and 7.25% respectively.
In 2015, the Group achieved significant improvements in the
stable operation of its production facilities. The expansion of
total processing capacity resulted in an increase in actual
production volume of the Group, which amounted to 13,866,200 tons,
up 2.18% over the previous year. During the year, the Group
processed 14,795,300 tons of crude oil (including 2,010,100 tons of
crude oil processed on a sub-contract basis), representing an
increase of 4.41% as compared with the previous year. Total
production output of refined oil products amounted to 8,975,900
tons, up 6.55%, among which the Group produced 3,097,600 tons of
gasoline, up 7.91%; 4,265,300 tons of diesel, up 4.92%, and
1,613,000 tons of jet fuel, up 8.36%. The Group produced 836,500
tons of ethylene, 533,000 tons of propylene and 112,300 tons of
butadiene, up 3.99%, 4.47% and 6.34%, respectively. The Group
produced 359,500 tons of benzene, up 3.45% and 659,700 tons of
paraxylene, down 3.07%. The Group also produced 1,042,700 tons of
synthetic resins and copolymers (excluding polyesters and polyvinyl
alcohol), at par with the previous year; 801,600 tons of synthetic
fiber monomers, up 13.56%; 416,600 tons of synthetic fiber
polymers, at par with the previous year; and 223,800 tons of
synthetic fibers, down 3.70%. Its output-to-sales ratio and
receivable recovery ratio were 99.91% and 100%, respectively.
The world economy experienced a weaker-than-expected economic
growth in 2015 and slack demand for oil. At the same time, the
reduction in production cost of crude oil helped to maintain a
faster growth in production volume. Global crude oil prices
fluctuated between mid to low levels. In 2015, the average unit
cost of crude oil processed by the Group (for its own account) was
RMB 2,533.46 per ton, down 45.15%
over the previous year. The Group's cost of processing crude oil in
2015 accounted for 51.61% of the total cost of sales.
During the Year, the Group leveraged its competitive edge in the
production integration of the refinery and petrochemical segments
and upheld its concept of optimizing the entire production process.
It maximized the returns by applying the optimization to individual
links in the production chain, such as procurement and allocation
of crude oil, product mix, production schedule and fuel mix.
Meanwhile, the Group continued to carry out various measures in
energy conservation and emission reduction in compliance with the
relevant national requirements, thereby achieving all targets set
by the government. The Group was committed to "further expand the
refining business, take the lead in the petrochemical industry, and
implement integration of refinery and petrochemical segments". It
also finished the first draft of the plan to construct and develop
the "Thirteenth Five-Year" project. The Group produced 281,400 tons
of new products and submitted 53 patent applications, and obtained
seven patent authorizations. It further accelerated the building of
management system and persistently optimized the management duty
and organization structure within the Company.
Looking forward, Mr. Wang Zhiqing said, "The global economy will
remain complex and volatile in 2016. Amid the continuous moderate
recovery in developed countries, the US economy is expected to
enter into an expansionary cycle driven by re-industrialization,
although emerging economies are still facing downward pressure.
China's economic development faces
uncertainties in the recovery of the global economy. Under the
principle of upholding growth anchored in stability, China will advance its supply-side structural
reform by focusing on reducing production capacity, inventories and
leverage, lowering costs and replenishing laggards. Besides,
efforts will be stepped up in enhancing the quality and
effectiveness of development, and the GDP is anticipated to
maintain a medium to high growth rate. In this context, the
domestic petroleum and petrochemical markets is facing a tougher
external business environment. China will accelerate the opening up of the
competitive businesses of natural monopolies in the industry, such
as oil and natural gas. During the "Thirteenth Five-Year" period,
petrochemical projects of tens of millions of tons will commence
production and intensify the competitive pressure in the
petrochemical industry. The Central and Shanghai government have introduced a series
of safety and environmental protection policies, which will
increase the development pressure faced by petrochemical
enterprises, while other factors will bring even greater challenges
to the development and survival of traditional petrochemical
enterprises, including the acceleration of quality upgrading for
refined oil, new industrial technologies and extensive application
of new materials. Under the complex and volatile market and a
prolonged severe operating environment, the Group will continue to
adhere to the enhancement of development quality and effectiveness.
Such an approach will not only ensure the prevention of safety and
environmental protection incidents and further enhance production
and operation level, but will also deepen system optimization,
lower costs and enhance efficiency, while realizing sustained
promising operating results.
Shanghai Petrochemical is one of the largest petrochemical
companies in China in terms of
sales revenue and was one of the first Chinese companies to
complete a global securities offering. Located at Jinshanwei in
southwest Shanghai, the Group is a
highly integrated petrochemicals enterprise which processes crude
oil into a broad range of products such as synthetic fibres, resins
and plastics, intermediate petrochemicals and petroleum
products.
This press release contains statements of a forward-looking
nature. These statements are made under the "safe harbor"
provisions of the U.S. Private Securities Litigation Reform Act of
1995. You can identify these forward-looking statements by
terminology such as "will", "expects", "anticipates", "future",
"intends", "plans", "believes", "estimates" and similar statements.
The accuracy of these statements may be impacted by a number of
business risks and uncertainties that could cause actual results to
differ materially from those projected or anticipated, including
risks such as the risk that the PRC economy may not grow at the
same rate in future periods as it has in the last several years, or
at all, due to the PRC government's implementation of
macro-economic control measures to curb over-heating of the PRC
economy; the risk of uncertainty as to global economic growth in
future periods; the risk that prices of the Company's raw
materials, particularly crude oil, will continue to increase, the
Company may not be able to raise the prices of its products as
appropriate, which would adversely affect the Company's
profitability; the risk that new marketing and sales strategies may
not be effective; the risk that fluctuations in demand for the
Company's products may cause the Company to either over-invest or
under-invest in production capacity in one or more of its four
major product categories; the risk that investments in new
technologies and development cycles may not produce the benefits
anticipated by the management; the risk that the trading price of
the Company's shares may decrease for a variety of reasons, some of
which may be beyond the control of the management; the risk of
competition in the Company's existing and potential markets; and
other risks outlined in the Company's filings with the U.S.
Securities and Exchange Commission. The Company does not undertake
any obligation to update this forward-looking information, except
as required under applicable laws.
Encl: Consolidated Income Statement
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SOURCE Sinopec Shanghai Petrochemical Company Limited