Hua Er Jie Jian Wen·2025-08-21 10:57Core Viewpoint - China Petroleum & Chemical Corporation (Sinopec) reported a decline in both revenue and profit amid falling international oil prices and accelerated energy transition, but achieved a significant increase in operating cash flow by 44.4% [1][2][3] Financial Performance - Revenue for the first half of 2025 was 1.41 trillion yuan, a decrease of 10.6% year-on-year, primarily due to the drop in international oil prices and weak demand for refined oil products [2][3] - Total profit decreased by 43.4% to 28.77 billion yuan, with net profit attributable to shareholders dropping by 39.8% to 21.48 billion yuan [1][3][7] - Operating cash flow reached 61 billion yuan, reflecting a 44.4% increase compared to the previous year [1][3][7] - Earnings per share fell by 40.2% to 0.177 yuan [3] Production and Sales - Oil and gas equivalent production reached 263 million barrels, marking a 2.0% year-on-year increase and setting a historical record for the same period [1][4][7] - Crude oil processing volume was 120 million tons, down 5.3% year-on-year, while total refined oil sales volume decreased by 5.8% to 112 million tons [4][7] - Ethylene production increased by 16.4% to 7.563 million tons [4] Strategic Initiatives - Despite challenges, Sinopec set higher production targets for the second half of the year, aiming for crude oil processing of 130 million tons and refined oil sales of 89.8 million tons [1][8] - The company plans to focus capital expenditures on key areas, with 63% of the 43.8 billion yuan allocated to exploration and development [8] - Major projects, such as the Maoming refinery upgrade and the 1.5 million-ton ethylene project in Zhenhai, are progressing well, supporting the company's transition to high-end chemical materials [9] Market Conditions - The decline in revenue was influenced by a 14.7% drop in the average Brent crude oil price to 71.7 USD per barrel and a 3.6% decrease in domestic refined oil consumption [2][7] - The refining segment faced significant pressure, with operating income dropping by 50.4% to 3.5 billion yuan, while the chemical segment reported a loss of 4.2 billion yuan due to industry overcapacity [7][11]