China Petroleum and Chemical Corporation
), also known as
, reported first-half 2013 net income of 30.281 billion yuan
($4.85 billion), up 23.6% year over year. Earnings per share of
0.246 yuan ($3.94 per ADS) jumped 17.7% year over year, as per
the International Financial Reporting Standards ("IFRS").
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The improvement was mainly supported by outstanding results in
oil and gas exploration on domestic growth in five key areas,
including Tarim Basin, the western rims of the Junngar Basin, the
Ordos Basin, the Sichuan Basin and the Xihu depression.
Revenues in the first quarter improved 5.0% to 1,415.244 billion
yuan from 1,347.85 billion yuan in the prior year.
During the six-month period ending Jun 30, 2013, Sinopec's crude
oil production grew 1.4% year over year to 165.4 million barrels,
while natural gas volumes surged 11.8% to 324.1 billion cubic
feet. Domestic crude oil production increased 1.1% year over year
to 153.7 million barrels, while overseas volumes increased 5.8%
year over year to 11.8 million barrels.
Total oil and gas production expanded 3.8% to 219.5 million
barrels of oil equivalent.
A sharp decline in crude oil prices led to a 23.5% fall in the
Exploration and Production (E&P) segment's operating profit
from the prior-year period. The figure came in at 30.9 billion
yuan (US$4.95 billion).
The company's Refining business recorded refinery throughput of
115.4 million tons (up 5.2% year over year). It also produced
approximately 69.8 million tons of oil products, representing a
5.8% improvement from the year-ago quarter.
The Marketing and Distribution segment sold 88.1 million tons of
refined oil products, reflecting a 6.5% year-over-year increase.
The output of ethylene from the Chemicals segment was 4.841
million tons, down 0.6% from the year-ago level.
Capital expenditures for the first half of 2013 totaled 51.975
billion yuan, of which 24.996 billion yuan was spent on
exploration at key oilfield projects in south Hubei, shallow
heavy oil in west Shengli, new blocks in the Tahe Oilfield,
Yuanba and the Daniudi gas fields, and the Shandong LNG project.
In the Refining segment, Sinopec spent 7.710 billion to upgrade
oil product quality and to restore the project for processing
lower quality crude oil.
The Marketing and Distribution segment expended 11.612 billion
yuan mainly for the construction and acquisition of service
stations along expressways and in major cities as well as for
building refined oil product pipelines and depots.
Capital expenditures in the Chemicals segment totaled 5.283
billion yuan, mainly due to the construction of the Wuhanethylene
plant, the Hubei syngas to MEG project and the Hainan aromatics
The company also spent 2.374 billion yuan for the company's
R&D facilities and IT projects.
Sinopec currently retains a Zacks Rank #3 (Hold). However, there
are other Zacks Ranked #1 (Strong Buy) stocks in the oil and gas
Range Resources Corp.
Susser Petroleum Partners LP
) - that appear more rewarding in the short term.