Category: Money tips Release Date: 2006-05-21
"This year, twice in the first half of oil significantly increases the average rate of 750 yuan per ton, an increase of 15%, unfortunately are still lagging behind the price rise of crude oil. As the oil prices finished the first half of the increase has been large, my personal understanding is that the market needs and consumer psychology from the cost in terms of both an increase to digest this. "August 28, Sinopec (0386.HK; 600028, SH), Chairman Chen Tonghai, in response to the second half of finished product Will oil prices coupled with, the state that consumers at ease, Sinopec investors worried about the answer.
As China's largest integrated oil and gas upstream and downstream enterprises, Sinopec attributed the profitability of the past few years the upstream business. In the first half of this year is no exception, exploration and extraction plate income increased 67% to 39.647 billion yuan, but a loss of 14.344 billion yuan because of the refining segment, so that only 14.6% in first half net profit growth, reported 20.679 billion yuan.
Chen Tonghai a press conference to explain the financial performance of refining plate from profit into loss (compared with profit of 1.391 billion yuan), and loss than securities analysts expected, because the May 26 this year, the refined oil price increase, the state at the same time provides intra-group transactions have accounted for at market value, so the performance of Sinopec in the first half lifted the previously common practice of internal subsidies, so that refining losses increase, while the marketing and distribution of plates increased profits, more accurately reflect the refining division plane on the pressure.
"If you want to break even refining plates and finished products is higher than that of crude oil per barrel is about 3 U.S. dollars, it is now hanging upside down about 4 U.S. dollars, not counting the cost of crude oil that we buy, sometimes higher than the international price of oil." Chen Tonghai enumerated to reporters this formula. By this calculation, refined oil price per ton price increase at least about 500 yuan, Sinopec's refining segment was profitable, but now with the sea, according to Chen predicted that oil prices in the second half finished unlikely to add, this part of the second half will continue to loss.
However, results of Chen at a press conference with the sea is also good news, as an important future earnings growth, Sinopec Sichuan points Puguang gas field proved reserves expected to be much higher than in February were confirmed by the State Reserve Committee of 251 billion cubic meters, to 322 billion cubic meters However, the figure has yet to be appointed to confirm reservoir. Plus reserves and recoverable reserves for the foreseeable three reserves forecast in August has reached 590 billion cubic meters, enough for 20 years mining purposes.
He added that the gas field is expected to begin in 2008, gas supply, gas supply in 2010 amounted to 12 billion cubic meters, the original gas supply targeted Henan, Shandong, and now need to be changed in accordance with national plans, while the Jiangsu, Zhejiang and Shanghai for the gas.
Chen Tonghai also confirmed that Sinopec stake in Guangxi will be 10 million tons refinery project into three shares, the remaining Qicheng Central Petroleum (0857.HK) holds. He said the total investment amounting to approximately 12.0 billion, but the exact amount and commencement date of the Sino-oil decisions. "This project has decided to the Chinese and the oil-led, our involvement, so the final program to be finalized in the oil over there." Prior to this, Petroleum and Sinopec have to apply to wholly-owned form of construction in Guangxi, 10 million-ton refinery in an attempt to open up the southwest market, and finally determined by the National Development and Reform Commission tone, co-operation from the two factories.
On the other hand, Sinopec announced a 10 rides, 2.8 shares of stock of the price reform program, ex-dividend price of about 4.796 yuan. Sinopec, Sinopec Group, parent company also announced that the State Development Bank, Cinda Asset Management and Orient Asset Management Corporation acquired a total of about 4.78 billion shares (or 5.5%), Sinopec, involving a total cash consideration of approximately 11.9 billion, to Ex-cash price, the market value of these shares for 22.647 billion yuan. After the acquisition and completion of share reform, the proportion of Sinopec Group's shareholding from 55.06% to 76.73%, Chen pointed out that with the sea, the parent company in the future have the opportunity to reduction, but will not exceed 5%.
"Parent company acquired the arrangement is also advantageous for the other shareholders, because it avoids that part of the shares sold in the market, plays a significant role to stabilize the stock price." Chen said, with the sea.
