October 29, 2008
Shanghai Petrochemical Announces Results for the First Three Quarters of 2008
HONG KONG, Oct. 29 /Xinhua-PRNewswire-FirstCall/ -- Sinopec Shanghai Petrochemical Company Limited ("Shanghai Petrochemical" or the "Company") (HKEx: 338; SSE: 600688; NYSE: SHI) announced today the unaudited operating results of the Company and its subsidiaries (the "Group") for the nine-month period ended September 30, 2008 (the "Period").
Under the China Accounting Standards for Business Enterprises, the Group's operating income for the Period amounted to RMB49.864 billion, representing an increase of RMB10.305 billion or 26% compared to the same period of last year. Operating loss for the Period was RMB5.710 billion (for the same period of 2007: operating profit was RMB2.291 billion). Net loss attributable to equity shareholders of the Company for the Period was RMB2.679 billion (for the same period of 2007: net profit attributable to equity shareholders of the Company was RMB1.664 billion). Basic diluted losses per share was RMB0.372 (for the same period of 2007: basic diluted profits per share was RMB0.231).
Mr. Rong Guangdao, Chairman of Shanghai Petrochemical, said, "From January 2008 to July 2008, the crude oil costs of the Company surged substantially as international crude oil prices soared continuously. Prices of refined oil products and crude oil were seriously inverted as a result of the Government's stringent control over the domestic prices of refined oil products, which led to a severe loss in the Company's oil refining operation. Since July 2008, following the rapid drop in international crude oil prices coupled with the worsening impact of the international financial crisis on the industry, consumption and market demand for downstream petrochemical products had dropped, which led to a substantial decline in the prices of petrochemical products. At the same time, it takes time for the Company to absorb the cost of the crude oil and intermediate raw materials which it had purchased at high prices; and the Group received a substantially reduced amount of financial subsidies for its oil refining operation during the third quarter of the year. The above-mentioned result in a significant loss in the Group's net profit for the period January to September 2008."
Shanghai Petrochemical is one of the largest petrochemical companies in the PRC and was one of the first Chinese companies to effect a global securities offering. Located in Jinshan District in the southwest of Shanghai, it is a highly integrated petrochemical complex which processes crude oil into a broad range of products in synthetic fibres, resins and plastics, intermediate petrochemicals and refined oil products.
To view the Shanghai Petrochemical Company Limited Consolidated Income Statement, please visit: http://xprnnews.xfn.info/SPC/20081029/ConsolidatedIncomeStatement.pdf
This press release contains statements of a forward-looking nature. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward- looking statements by terminology such as "will,""expects,""anticipates,""future,""intends,""plans,""believes,""estimates" and similar statements. The accuracy of these statements may be impacted by a number of business risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including risks related to: the risk that the PRC economy may not grow at the same rate in future periods as it has in the last several years, or at all, including as a result of the PRC government's macro-economic control measures to curb over-heating of the economy; uncertainty as to global economic growth in future periods; the risk that prices of the Company's raw materials, particularly crude oil, will continue to increase; the risk that the Company may not be able to raise its product prices (particularly refined oil products) accordingly which would adversely affect the Company's profitability; the risk that new marketing and sales strategies may not be effective; the risk that fluctuations in demand for the Company's products may cause the Company to either over-invest or under-invest in production capacity in one or more of its four major product categories; the risk that investments in new technologies and development cycles may not produce the benefits anticipated by management; the risk that the trading price of the Company's shares may decrease for a variety of reasons, some of which may be beyond the control of management; competition in the Company's existing and potential markets; and other risks outlined in the Company's filings with the U.S. Securities and Exchange Commission. The Company does not undertake any obligation to update this forward-looking information, except as required under applicable law.
For further information, please contact: Ms. Christy Lai or Ms. Eva Law Rikes Hill & Knowlton Limited Tel: +852-2520-2201 Fax: +852-2520-2241
Sinopec Shanghai Petrochemical Company Limited
CONTACT: Ms. Christy Lai or Ms. Eva Law of Rikes Hill & KnowltonCommunications Limited, +852-2520-2201, or fax, +852-2520-2241, for SinopecShanghai Petrochemical Company Limited