SPC(SH:600688)2023-03-22 16:00Financial Performance - The net loss attributable to shareholders for 2022 was RMB 2,872,072 thousand under Chinese accounting standards, and RMB 2,846,156 thousand under IFRS[5]. - The company reported a net loss attributable to shareholders of RMB 2,872.1 million in 2022, a decline of 243.57% from a profit of RMB 2,000.5 million in 2021[25]. - Basic and diluted earnings per share for 2022 were both RMB (0.263), compared to RMB 0.192 in 2021, indicating a significant loss[25]. - The weighted average return on equity decreased to (10.163%) in 2022, down 16.89 percentage points from 6.727% in 2021[24]. - The company's total assets at the end of 2022 were RMB 41,242.7 million, a decrease of 12.32% from RMB 47,038.6 million at the end of 2021[25]. - The company's net profit attributable to shareholders was a loss of RMB 2.8462 billion, compared to a profit of RMB 2.0734 billion in 2021[54]. - The gross loss for the company was RMB 3.8434 billion, compared to a profit of RMB 1.4322 billion in 2021[54]. - The net loss after tax for 2022 was RMB 2.8423 billion, a decrease of RMB 4.9189 billion compared to a net profit of RMB 2.0766 billion in the previous year[76]. - The company's cash flow from operating activities showed a net outflow of RMB 7,337.5 million in 2022, compared to a net inflow of RMB 4,060.0 million in 2021[25]. - The company's cash flow from operating activities showed a net outflow of RMB 7.337 billion, an increase in outflow of 280.73% compared to a net inflow of RMB 4.060 billion in 2021[93]. Revenue and Sales - The company's net sales for 2022 were RMB 72,654.6 million, a decrease of 4.3% compared to RMB 75,888.8 million in 2021[25]. - The company's revenue for the year was RMB 82.443 billion, representing a decline of 7.57% compared to the previous year[38]. - The company's total revenue for 2022 was RMB 72.6546 billion, a decrease of 4.26% from RMB 75.8888 billion in 2021[54]. - Synthetic fiber revenue dropped to RMB 412.5 million, a significant decline of 70.00% compared to RMB 1,374.8 million in the previous year, with sales volume decreasing by 78.02%[54]. - Revenue from resins and plastics fell to RMB 7.3212 billion, down 26.51% from RMB 9.9627 billion in 2021, with sales volume decreasing by 29.13%[55]. - Intermediate petrochemical products generated RMB 10.5377 billion in revenue, a slight decrease of 2.25% from RMB 10.7805 billion, with sales volume down by 11.43%[56]. - Oil products revenue was RMB 41.4447 billion, a decrease of 1.05% from RMB 41.8844 billion, with sales volume declining by 30.06%[57]. - Revenue from petrochemical product trading increased to RMB 12.0076 billion, an increase of 8.65% from RMB 11.0514 billion, driven by higher sales from a subsidiary[58]. - Other revenue rose to RMB 930.9 million, an increase of 11.48% from RMB 835.0 million in the previous year[59]. Costs and Expenses - The group's total sales costs and expenses for 2022 amounted to RMB 76.498 billion, an increase of 2.74% compared to RMB 74.457 billion in 2021[61]. - The sales cost for 2022 was RMB 76.266 billion, up 2.65% from RMB 74.298 billion in the previous year, with sales costs accounting for 104.97% of the net sales for the year[62]. - The total operating cost for 2022 was RMB 73,518 million, an increase of 2.57% from RMB 71,676 million in 2021, primarily due to rising international crude oil prices[98]. - The total cost of crude oil processing increased by RMB 3.956 billion, up 9.16% year-on-year, accounting for 61.81% of total sales costs[40]. Assets and Liabilities - The company's net asset attributable to shareholders decreased by 13.27% to RMB 26,243.7 million at the end of 2022 from RMB 30,260.2 million at the end of 2021[25]. - The company experienced a significant increase in total liabilities, which amounted to RMB 14,781.4 million at the end of 2022, compared to RMB 16,543.2 million at the end of 2021[26]. - The asset-liability ratio as of December 31, 2022, was 35.93%, up from 35.26% in 2021[80]. - As of December 31, 2022, cash and cash equivalents amounted to RMB 3,998,332 thousand, a decrease of 68.01% from RMB 12,498,617 thousand in the previous year[113]. - Accounts receivable increased by 114.84% to RMB 2,512,362 thousand, indicating a rise in outstanding payments[113]. - The total liabilities included accounts payable of RMB 9,144,554 thousand, which increased by 55.29% due to rising crude oil procurement prices[113]. Research and Development - The company applied for 120 patents and was granted 59, highlighting its commitment to technological innovation[42]. - The research and development expenses for 2022 were RMB 130.5 million, an increase from RMB 94.3 million in 2021, primarily due to higher material costs for equipment and product technology development[81]. - The company's research and development (R&D) expenses totaled RMB 130,516 thousand, accounting for 0.16% of total revenue[102]. - The company’s R&D efforts are detailed in the management discussion and analysis section, focusing on innovation and product development[155]. Management and Governance - The board of directors proposed not to distribute dividends for the year and not to increase capital from reserves[5]. - The financial statements were audited by KPMG Huazhen and KPMG, both issuing standard unqualified audit opinions[9]. - The company has not experienced any non-operational fund occupation by controlling shareholders or related parties[6]. - There were no violations of decision-making procedures regarding external guarantees[7]. - The company has maintained stable production operations following an explosion incident, with all production lines returning to normal by the end of September[41]. - The company has maintained a good integrity status, with no significant debts or obligations unmet during the reporting period[183]. - The company confirmed that all related party transactions were conducted at market prices and did not significantly affect its independence[188]. Future Outlook and Strategy - The company plans to continue optimizing its product structure and improving product quality to meet the growing demand for petrochemical products in China[34]. - The company plans to process 13.6 million tons of crude oil in 2023, with production targets of 8.001 million tons of refined oil, 756,000 tons of ethylene, and 680,000 tons of paraxylene[128]. - The company aims to achieve commercial operation of the first phase of the 48K tow project and start construction of the second phase within the year[132]. - The company anticipates capital expenditure of approximately RMB 3.7 billion for 2023[123]. - The company is committed to enhancing safety and environmental standards, focusing on risk management and compliance with environmental regulations[128]. - The company plans to strengthen its core industries, particularly in high-end new materials like carbon fiber, and aims to transition towards renewable energy sources[127]. - The company will optimize its management structure to improve efficiency and enhance internal capabilities[130]. - The company emphasizes talent development and employee satisfaction to support its long-term growth strategy[133]. Market and Industry Conditions - The company faces challenges including fluctuating oil prices, market uncertainties, and rising investment costs, which may impact financial stability and operational efficiency[126]. - The company’s revenue is significantly affected by the cyclical nature of the oil and petrochemical markets, with potential adverse impacts from rising crude oil prices and falling petrochemical product prices[134]. - The company’s ability to pass on increased costs due to rising crude oil prices to customers is dependent on market conditions and government regulations, which may lead to delays[135]. - The company is subject to strict environmental regulations in China, and future regulatory changes could result in additional costs[137]. - The company’s operations and financial results may be adversely affected by fluctuations in the exchange rate of the Renminbi against other currencies, particularly the US dollar[138]. - Recent government policies have provided opportunities for high-quality development in the petrochemical industry, particularly in new materials and high-end chemicals[144]. Related Party Transactions - The company is involved in significant related party transactions with its controlling shareholder, Sinopec Corp, which could impact its business and economic benefits[140]. - Sinopec Corp holds approximately 50.44% of the company's shares, giving it absolute control and the potential to influence the company's operations and financial decisions[141]. - The company engaged in a technology development contract with Sinopec Corp for the research and development of high-performance carbon fiber equipment, with a total cost of RMB 44,400,000, to be paid in two installments[190]. - The company signed a new product supply and sales service framework agreement with Sinopec Group, effective for three years until December 31, 2025[184]. Compliance and Legal Matters - The company has no significant litigation or arbitration matters during the reporting period[181]. - The company has not faced any administrative penalties or investigations by the China Securities Regulatory Commission during the reporting period[182].