Sinopec Q3 profit up 34% on higher refinery output, fuel sales

CHINA’S Sinopec on Thursday (Oct 26) reported a 34 per cent rise in third-quarter net profit to 17.86 billion yuan (S$3.4 billion) as higher refinery output and strong fuel sales offset lower realised oil and gas prices.

Sinopec, the world’s largest refiner by capacity, achieved revenue of 876.3 billion yuan, up 4.2 per cent from a year earlier, the company said in a stock filing.

Between January and September Sinopec processed 193.74 million metric tons of crude oil, or 5.18 million barrels per day, up 7.6 per cent versus a year earlier.

Refined fuel sales soared 19 per cent to 180.55 million tons, reflecting a continued demand recovery domestically as well as growing fuel exports as the refiner cashed in robust overseas margins.

Of the total fuel sales, domestic sales expanded 16.9 per cent to nearly 143 million tons, indicating overseas fuel sales of nearly 38 million tons, a 28 per cent rise year-on-year based on Reuters’ calculations.

Domestic fuel demand extended its recovery into the third quarter, with a rebound in travel during China’s Golden Week holidays supporting petrol and kerosene consumption.

Its petrochemical business, particularly synthetic fibre and polymer, remained under pressure however due to a severe supply overhang, the company said.

During the first nine months of the year Sinopec produced 210.6 million barrels of crude oil, down 0.1 per cent, while its natural gas output rose 8.7 per cent to 993 billion cubic feet.

The company has been stepping up exploring geologically more challenging reserves, like the Bazhong gas field and more shale gas acreage in Sichuan.

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Capital expenditure for the first nine months amounted to 08.1 billion yuan, up from 104 billion yuan a year earlier.

Sinopec’s Hong Kong-listed shares have risen 6.1 per cent year-to-date, outperforming the Hang Seng Index which has fallen 13.6 per cent during the period. REUTERS