China’s Sinopec 2022 net profit falls 8.1% on weak demand, high cost
Fanny Zhang
27-Mar-2023
SINGAPORE (ICIS)–China’s biggest refiner Sinopec posted an 8.1% decrease in 2022 net profit as tepid demand and strong crude squeezed its margins.
| In million yuan (CNY) | 2022 | 2021 | % change |
| Income | 3,318,168 | 2,740,884 | 21.1% |
| Operating expenses | -3,242,333 | -2,646,256 | 22.5% |
| Operating profit | 75,835 | 94,628 | -19.9% |
| Profit attributable to shareholders | 66,153 | 71,975 | -8.1% |
KEY POINTS
– Domestic demand in China for natural gas,
petrochemicals and fuel weakened in 2022,
partly of global economic weakness, Sinopec
said on Sunday.
– Chemical margins slumped amid soft demand and
increased feedstock prices. The chemical
segment reported an operating loss of
CNY14.1bn, reversing the CNY11.1bn profit
generated in 2021.
– Refining margin declined by 64.7% to
CNY344/tonne, mainly due to lower domestic
gasoline and diesel processing margins because
of high crude prices and freight cost.
OUTLOOK
– Sinopec expects demand to improve this year
as the Chinese economy recovers.
– Its 2023 crude output is expected to slip,
but gas, fuel and ethylene output will all post
increases.
– Sinopec’s planned capital expenditure (capex)
for 2023 will be CNY165.8bn, down 12.3% from
2022.
| Output | 2023 target | 2022 | Change |
| Crude (million barrels) | 280.23 | 280.86 | -0.2% |
| Natural gas production (billion cubic feet) | 1291.8 | 1248.75 | 3.4% |
| Refinery throughput (million tonnes) | 250 | 242.27 | 3.2% |
| Gasoline, diesel and kerosene (million tonnes) | 146 | 140.15 | 4.2% |
| Ethylene (million tonnes) | 14 | 13.44 | 4.2% |
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