China Petroleum and Chemical Corporation (Sinopec) said Sunday its net profit in the first half of 2009 rose 332.8 percent year on year because of adjusted refined oil prices in domestic market.
Under international accountant rules, Sinopec's net profit totaled 33.25 billion yuan (4.87 billion U.S. dollars) in the first half with earnings per share up 0.294 yuan to 0.383 yuan, the company said in a statement to the Shanghai and Hong Kong stock markets.
Of the same reasons, Sinopec predicted its net profit for the first three quarters will rise over 50 percent year on year.
Sinopec saw its net profit dropped 73.4 percent year on year to 9.34 billion yuan in the first six months of 2008 because of huge losses caused by China's price ceilings on refined oil products and global oil price rises.
The leading refiner reported profit of 19.9 billion yuan in its refining sector in the first six months of 2009, while the sector confirmed losses of 46 billion yuan in the first half of 2008.
"Although a rise over 300 percent is astonishing, the level of the net profit is normal compared with the first half of 2007 when global crude price is not as high as the first half of 2008 and the effect of price ceilings on refined oil products is not that severe," said an inner person with Sinopec.
Sinopec's net profit totaled 36.2 billion yuan in the first half of 2007. Total turnover in the first half of 2009 reached 534billion yuan, down 30.2 percent from the previous year because of contraction of market demand amid the global financial crisis.
As the Chinese government will stick to its moderately easy monetary policy and active fiscal policy, the Chinese economy will maintain a relatively rapid growth and the domestic demand for refined oil and chemical products will continue to recover in the second half of the year, the company said.
China's GDP grew by 7.1 percent in the first half, one percentage point higher than the first quarter.
Sinopec predicted the international oil prices would fluctuate at a level higher than the first six months. The crude price has risen from an average of 51.6 U.S. dollars per barrel in the first quarter to around 70 U.S. dollars per barrel recently.
Sinopec will endeavor to expand the market as well as improve its management to reduce cost and increase the efficiency to bring a better result to investors, the company said.
Listed in Hong Kong, New York, London and Shanghai, Sinopec is the listed subsidiary of China Petrochemical Corporation (Sinopec Group).