29 Apr 2020 10:03
China Petroleum & Chemical Corporation
The First Quarterly Report for 2020
29 April 2020
Beijing, China
1 Important notice
1.1 The Board of Directors, the Board of Supervisors of China Petroleum & Chemical Corporation ("Sinopec Corp." or "the Company") and its directors, supervisors and senior management warrant that there are no false representations, misleading statements or material omissions contained in this report and severally and jointly accept full responsibility for the authenticity, accuracy and completeness of the information contained in this report.
1.2 The first quarterly report for 2020 was approved at the 14th meeting of the Seventh Session of the Board of Directors of Sinopec Corp. All directors attended this meeting.
1.3 Mr. Zhang Yuzhuo, Chairman, Mr. Ma Yongsheng, President, Ms. Shou Donghua, Chief Financial Officer and Head of the Financial Department of Sinopec Corp. warrant the authenticity, accuracy and completeness of the financial statements contained in this quarterly report.
1.4 The financial statements in this quarterly report were not audited.
2 Basic information of Sinopec Corp.
2.1 Principal financial data and indicators
2.1.1 Principal financial data and indicators prepared in accordance with China Accounting Standards for Business Enterprises (CASs)
RMB million |
| ||||||
Items | As of 31 March 2020 | As of 31 December 2019 | Changes from the end of the preceding year to the end of the reporting period (%) |
| |||
Total assets | 1,807,539 | 1,755,071 | 3.0 |
| |||
Total equity attributable to equity shareholders of the Company | 712,350 | 739,169 | (3.6) |
| |||
RMB million |
| ||||||
Items | Three-month period ended 31 March | Changes over the same period of the preceding year (%) | |||||
2020 | 2019 | ||||||
Net cash flow from operating activities | (68,125) | (14,609) | - | ||||
Operating income | 555,502 | 717,579 | (22.6) | ||||
Net profit attributable to equity shareholders of the Company | (19,782) | 14,763 | - | ||||
Net profit attributable to equity shareholders of the Company excluding extraordinary gains and losses | (20,444) | 14,370 | - | ||||
Weighted average return on net assets (%) | (2.73) | 2.03 | (4.76) percentage points | ||||
Basic earnings per share (RMB) | (0.163) | 0.122 | - | ||||
Diluted earnings per share (RMB) | (0.163) | 0.122 | - | ||||
RMB million |
| ||||||
Extraordinary items | During the reporting period |
| |||||
(income)/expenses（RMB million） |
| ||||||
Net gain on disposal of non-current assets | (60) |
| |||||
Donations | 73 |
| |||||
Government grants | (1,164) |
| |||||
Gains on holding and disposal of various investments | (26) |
| |||||
Other extraordinary income and expenses, net | 255 |
| |||||
Subtotal | (922) |
| |||||
Tax effect | 234 |
| |||||
Total | (688) |
| |||||
Attributable to: |
| ||||||
Equity shareholders of the Company | (662) |
| |||||
Minority interests | (26) |
| |||||
2.1.2 Principal financial data and indicators prepared in accordance with International Financial Reporting Standards (IFRS)
RMB million |
| |||
Items | As of 31 March 2020 | As of 31 December 2019 | Changes from the end of the preceding year to the end of the reporting period (%) |
|
Total assets | 1,807,539 | 1,755,071 | 3.0 |
|
Total equity attributable to shareholders of the Company | 711,343 | 738,150 | (3.6) |
|
RMB million |
| |||
Items | Three-month period ended 31 March | Changes over the same period of the preceding year (%) | ||
2020 | 2019 | |||
Net cash generated from operating activities | (68,125) | (14,609) | - | |
Operating profit | (26,305) | 24,841 | - | |
Net profit attributable to shareholders of the Company | (19,145) | 15,468 | - | |
Basic earnings per share (RMB) | (0.158) | 0.128 | - | |
Diluted earnings per share (RMB) | (0.158) | 0.128 | - | |
Return on net assets (%) | (2.69) | 2.09 | (4.78) percentage points | |
2.2 Total number of shareholders and top ten shareholders at the end of the reporting period
Total number of shareholders at the end of the reporting period | Total number of shareholders was 553,217, including 547,424 holders of domestic A shares and 5,793 holders of overseas H shares. | |||
Top ten shareholders | ||||
Name of shareholder | Total number of shares held | Percentage (%) | Number of shares subject to pledge or lock-ups | Nature of shareholder |
China Petrochemical Corporation | 82,709,227,393 | 68.31 | 0 | State-owned share |
HKSCC (Nominees) Limited | 25,389,028,547 | 20.97 | Unknown | H share |
中国证券金融股份有限公司 | 2,609,312,057 | 2.16 | 0 | A share |
国新投资有限公司 | 997,141,120 | 0.82 | 0 | A share |
北京诚通金控投资有限公司 | 756,822,451 | 0.63 | 0 | A share |
中国人寿保险股份有限公司－分红－个人分红－005L－FH002沪 | 480,607,041 | 0.40 | 0 | A share |
香港中央结算有限公司 | 463,936,458 | 0.38 | 0 | A share |
中国人寿保险股份有限公司－传统－普通保险产品－005L－CT001沪 | 449,301,461 | 0.37 | 0 | A share |
中央汇金资产管理有限责任公司 | 322,037,900 | 0.27 | 0 | A share |
汇添富基金管理股份有限公司－社保基金1103组合 | 133,250,000 | 0.11 | 0 | A share |
Note Sinopec Century Bright Capital Investment Limited, overseas wholly-owned subsidiary of China Petrochemical Corporation, holds 553,150,000 H shares, which is included in the total number of the shares held by HKSCC (Nominees) Limited.
Statement on the connected relationship or acting in concert among the aforementioned shareholders:
Apart from中国人寿保险股份有限公司－分红－个人分红－005L-FH002沪和中国人寿保险股份有限公司－传统－普通保险产品－005L-CT001沪 which were both administrated by 中国人寿保险股份有限公司, Sinopec Corp. is not aware of any connected relationship or acting in concert among or between the above-mentioned shareholders.
2.3 Review of operating results
In the first quarter of 2020, as the COVID-19 outbreak spread worldwide, the world economy faced mounting downside risk packing with notably increasing instability and uncertainty. China's GDP decreased by 6.8% year on year. Due to plunging market demand for petroleum and petrochemical products coupled with slump of crude oil price, oil and gas industry was severely impacted.
Facing the complicated and severe situation, the Company adhered to the principles of "concentrating material tasks, system optimisation, controlling risk and seizing opportunities out of crisis", coordinated epidemic prevention and control with work resumption, brought our advantages of integrated business into full play, optimised production plan, refined operation plan, adjusted products slate, optimised inventory, expanded market, and tapped potentials and reduced cost to minimize the negative impact and maintained safe and steady operations. In particular, to combat the COVID-19, we maintained a stable supply of oil and gas, made great efforts to increase production of medical-use materials, coordinated online and offline non-fuel business to facilitate our customers with wider variety of products and services, and advanced resumption of work and production with industry chain partners.
In accordance with China Accounting Standards for Business Enterprises, net profit attributable to equity shareholders of the Company was RMB -19.782 billion. In accordance with IFRS, net profit attributable to equity shareholders of the Company was RMB -19.145 billion.
Exploration and Production: Under low crude oil price environment, we pressed ahead with high-efficiency exploration and paid more efforts on profit-oriented development, reduced cost and expenditure on all fronts and accelerated the formation of an integrated value chain of natural gas business including production, supply, storage and marketing. In exploration, we focused on organisation and operation of major projects and new discovery breakthrough. In crude oil development, we pushed to build profitable production capacity, and deepened structure adjustment in mature oil fields. In natural gas development, we expanded the market and promoted a coordinated growth along the value chain. In the first quarter, oil and gas production of the Company was 112.28 million barrels of oil equivalent, among which the production of crude oil was broadly flat compared with the same period of last year. Exploration and Production Segment realised an operating profit of RMB 1.518 billion
Exploration and Production | Unit | Three-month period ended 31 March | Changes | |
2020 | 2019 | (%) | ||
Oil and gas production | million boe | 112.28 | 113.46 | (1.0) |
Crude oil production | million barrels | 70.65 | 70.81 | (0.2) |
China | million barrels | 62.11 | 61.55 | 0.9 |
Overseas | million barrels | 8.54 | 9.26 | (7.8) |
Natural gas production | billion cubic feet | 249.68 | 255.79 | (2.4) |
Realised crude oil price | USD/barrel | 49.15 | 57.66 | (14.8) |
Realised natural gas price | USD/thousand cubic feet | 6.43 | 7.07 | (9.2) |
Conversion: For domestic production of crude oil, 1 tonne = 7.10 barrels. For overseas production of crude oil,
1 tonne = 7.21 barrels. For production of natural gas, 1 cubic meter = 35.31 cubic feet.
Refining: Facing severe situation of plunged market demand, high-level inventory and slump of crude oil price, we persistently coordinated the integration of production and marketing, optimised allocation of resources and product slate based on market demand and continuously implemented low sulfur fuel oil projects. We coordinated domestic and overseas markets and increased the export of refined oil products, maintaining a steady operation of refining facility. In the first quarter, refinery throughput was 53.74 million tonnes, decreased by 13% year on year. The refining segment's operating loss was RMB 25.794 billion.
Refining | Unit | Three-month period ended 31 March | Changes (%) | |
2020 | 2019 | |||
Refinery throughput | million tonnes | 53.74 | 61.78 | (13.0) |
Gasoline, diesel and kerosene production | million tonnes | 33.00 | 39.44 | (16.3) |
Gasoline | million tonnes | 13.02 | 15.87 | (18.0) |
Diesel | million tonnes | 14.19 | 16.03 | (11.5) |
Kerosene | million tonnes | 5.79 | 7.54 | (23.2) |
Light chemical feedstock production | million tonnes | 9.84 | 10.07 | (2.2) |
Light product yield | % | 75.31 | 76.14 | (0.83) percentage points |
Refining yield | % | 94.64 | 94.76 | (0.12) percentage points |
Note: Including 100% production of domestic joint ventures.
Marketing and Distribution: To address the dramatic decline of market demand, we enhanced market analysis, pressed ahead measures for market expansion, promoted targeted marketing strategy and tapped the potentials of distribution network. In order to satisfy the market demands during the epidemic, we innovated the non-fuel business model by coordinating online and offline business with wider variety of products and services, which not only realised a beneficial exploration of the sales model but also provided convenience to our consumers. In the first quarter, total sales volume of refined oil products was 53.68 million tonnes and marketing and distribution segment's operating loss was RMB 1.536 billion.
Marketing and Distribution | Unit | Three-month period ended 31 March | Changes (%) | |
2020 | 2019 | |||
Total sales volume of refined oil products | million tonnes | 48.61 | 62.37 | (22.1) |
Total domestic sales volume of refined oil products | million tonnes | 32.48 | 45.61 | (28.8) |
Retail | million tonnes | 21.83 | 30.20 | (27.7) |
Direct sales & Distribution | million tonnes | 10.65 | 15.41 | (30.9) |
Annualized average throughput per station | tonnes | 2,844 | 3,939 | (27.8) |
Note: The total sales volume of refined oil products includes the amount of trading volume.
Chemicals: Under the circumstances of dramatic demand decline and price tumble of chemical products, we actively optimised resources allocation, reduced feedstock cost, adjusted operation plan and enhanced the dynamic optimisation of facilities and product chain, and improved the utilisation and production scheduling based on market demand. Giving full play to our industry advantages, we extended business value chain by increasing production of medical-use materials to ensure market supply. We put more efforts on market expansion to create space for production optimisation and adjustment as well as facilities stable operation. In the first quarter, the ethylene production was 3.026 million tonnes, being flat compared with the same period of last year, synthetic resin production increased by 2.8% year on year. The total chemical sales volume was 17.95 million tonnes. The Chemical segment's operating loss was RMB 1.568 billion.
Chemicals | Unit | Three-month period ended 31 March | Changes (%) | |
2020 | 2019 | |||
Ethylene | thousand tonnes | 3,026 | 3,049 | (0.8) |
Synthetic resin | thousand tonnes | 4,293 | 4,178 | 2.8 |
Synthetic rubber | thousand tonnes | 256 | 271 | (5.5) |
Monomers and polymers for synthetic fibre | thousand tonnes | 2,333 | 2,575 | (9.4) |
Synthetic fibre | thousand tonnes | 266 | 322 | (17.4) |
Note: Including 100% production of domestic joint ventures.
Capital expenditure: In the first quarter, total capital expenditures of the Company was RMB 13.2 billion. Capital expenditure for the exploration and production segment was RMB 6.1 billion, mainly for Shengli and Northwest crude oil development projects, Fuling and Weirong shale gas projects. Capital expenditure for the refining segment was RMB 2.4 billion, mainly for Zhongke Refining and Petrochemical project, Zhenhai, Tianjin, Maoming and Beihai refining upgrading projects, low sulfur fuel oil projects and high-end carbon materials projects. Capital expenditure for the marketing and distribution segment was RMB 2.6 billion, mainly for construction of service stations, refined oil products depots and non-fuel businesses. Capital expenditure for the chemicals segment was RMB 2.1 billion, mainly for Zhongke Refining and Petrochemical project, Zhenhai, Gulei, Sinopec-SK ethylene projects renovation, Hainan ethylene projects.
2.4 Business Prospects
China's epidemic prevention and control trend has been further consolidated, the country's economic and social activities have gradually returned to normal, the production and living order has been restored at a faster pace, and the pent-up demand for petroleum and petrochemical products is being released. Under this opportunity, we have initiated a campaign that will last for 100 days to address the tough challenges and to improve performance. With management and staffs joint efforts, we are to reinforce measures on market expansion, operations optimisation, cost reduction, tapping potentials, and maintaining safe and steady operations, to minimise the negative impact of the epidemic. We will adjust dynamically the production and operation arrangement and the investment plan, focusing on achieving a high-quality and more profitable operation. While ensuring prevention and control of the pandemic and maintaining safe and stable operation, we will give priority to the following tasks:
More vigorous efforts on market expansion. We will keep pace with the market recovery and the industry utilisation rate to seize the market opportunities, provide targeted services to reinforce the market share. Through innovation of business model and analysis of consumption demand changes, we will exploit potential demand to expand market share. By giving full play to the advantages of the industry chain, we will strengthen cooperation with partner and realise coordinative development.
More vigorous efforts on optimisation and adjustment. We will bring our advantages of integrated business into full play, refine the allocation of resources, and coordinate all the activities including procurement, transportation, production, storage and marketing. In the E&P segment, we will strengthen the overall coordination of "investment, reserves, output, cost, and profit". In the mid- and down-stream, we will coordinate the operation, feedstock slate, product mix and regional resources, accelerate advantages cultivation and production capacity building, and reinforce the effort in the integration of the production with the marketing.
More vigorous efforts on tapping potentials and cost reduction. We will conduct fine management and strengthen cost control involving all employees, covering all resources and conducting in all processes. We will improve the capital efficiency, expand financing channels and reduce financing cost.
3 Significant events
3.1 Significant changes in major items contained in the consolidated financial statements prepared in accordance with CASs and the reasons for such changes.
Items of Consolidated Balance Sheet | As of 31 March 2020 | As of 31 December 2019 | Increase/(Decrease) | Main reasons for changes | |
Amount | Percentage | ||||
RMB million | RMB million | RMB million | （%） | ||
Financial assets held for trading | 2,012 | 3,319 | (1,307) | (39.4) | Receipt of the structured deposits at maturity |
Derivative financial assets | 14,459 | 837 | 13,622 | 1,627.5 | Changes of fair value loss and profit position of derivative hedging financial instruments due to fluctuation of crude oil price |
Derivative financial liabilities | 26,362 | 2,729 | 23,633 | 866.0 | |
Prepayments | 7,296 | 5,066 | 2,230 | 44.0 | Increase in projects down payment |
Other receivables | 57,149 | 24,109 | 33,040 | 137.0 | Increase in margin deposit in financial derivatives business due to decline of crude oil price |
Short-term loans | 98,203 | 31,196 | 67,007 | 214.8 | Increase in low-interest short-term loans |
Taxes payable | 37,622 | 69,339 | (31,717) | (45.7) | Due to the time difference of tax payment, part of the unpaid tax from the end of last year had been paid during this reporting period |
Other current liabilities | 19,997 | - | 19,997 | - | Issuing short-term debentures payable of RMB 20 billion |
Long-term loans | 52,870 | 39,625 | 13,245 | 33.4 | Increase in project loans of subsidiaries |
Other comprehensive income | (7,983) | (321) | (7,662) | - | Increase in fair value loss of hedging business for crude oil |
Items of Consolidated Income Statement | For three-month period ended 31 March | Increase/(Decrease) | Main reasons for changes | ||
2020 | 2019 | Amount | Percentage | ||
RMB Million | RMB Million | RMB Million | （%） | ||
Gains/ (losses) from changes in fair value | 8,342 | (2,226) | 10,568 | - | Increase in fair value profit on derivative financial instruments not qualified as hedging |
Impairment losses | (10,360) | 136 | (10,496) | - | Increase of inventory impairment |
Items of consolidated cash flow statement | For three-month period ended 31 March | Increase/(Decrease) | Main reasons for changes | ||
2020 | 2019 | Amount | Percentage | ||
RMB million | RMB million | RMB million | （%） | ||
Other cash paid relating to operating activities | (59,028) | (39,806) | (19,222) | - | Mainly due to increase in margin deposit of financial derivative business |
Cash received from disposal of investments | 3,402 | 9,636 | (6,234) | (64.7) | Decrease in structured deposits at maturity |
Other cash received relating to investing activities | 19,162 | 13,165 | 5,997 | 45.6 | Increase in value of certificate of deposit, over three months, expired and recovered |
Other cash paid relating to investing activities | (14,094) | (24,388) | 10,294 | - | Decrease in the value of certificate of deposit, over three months |
Cash received from borrowings | 274,615 | 149,622 | 124,993 | 83.5 | Increase in low-interest short-term loans |
Cash repayments of borrowings | (172,518) | (118,511) | (54,007) | - | Increase in repayment of short-term loans at maturity |
3.2 This quarterly results announcement is published in both Chinese and English languages. In the event of any inconsistency between the two versions, the Chinese version shall prevail.
By Order of the Board
Chairman
Zhang Yuzhuo
29 April, 2020
4 Appendix
4.1 Quarterly financial statements prepared under China Accounting Standards for Business Enterprises (CASs)
Consolidated Balance Sheet | ||
as at 31 March 2020 | ||
Prepared by: China Petroleum & Chemical Corporation | ||
Units: million Currency: RMB Type: unaudited | ||
Items | At 31 March 2020 | At 31 December 2019 |
Current assets: |
| |
Cash at bank and on hand | 138,773 | 127,927 |
Financial assets held for trading | 2,012 | 3,319 |
Derivative financial assets | 14,459 | 837 |
Accounts receivable | 54,246 | 54,865 |
Receivables financing | 8,746 | 8,622 |
Prepayments | 7,296 | 5,066 |
Other receivables | 57,149 | 24,109 |
Inventories | 183,277 | 192,442 |
Other current assets | 30,074 | 28,669 |
Total current assets | 496,032 | 445,856 |
Non-current assets: | ||
Long-term equity investments | 152,561 | 152,204 |
Other equity instrument investments | 1,525 | 1,521 |
Fixed assets | 611,564 | 622,423 |
Construction in progress | 177,021 | 173,482 |
Right-of-use assets | 197,349 | 198,051 |
Intangible assets | 108,039 | 108,956 |
Goodwill | 8,716 | 8,697 |
Long-term deferred expenses | 8,531 | 8,930 |
Deferred tax assets | 29,343 | 17,616 |
Other non-current assets | 16,858 | 17,335 |
Total non-current assets | 1,311,507 | 1,309,215 |
Total assets | 1,807,539 | 1,755,071 |
Current liability: | |||
Short-term loans | 98,203 | 31,196 | |
Derivative financial liabilities | 26,362 | 2,729 | |
Bills payable | 14,479 | 11,834 | |
Accounts payable | 154,103 | 187,958 | |
Contract liabilities | 137,563 | 126,735 | |
Employee benefits payable | 7,126 | 4,769 | |
Taxes payable | 37,622 | 69,339 | |
Other payables | 73,908 | 72,324 | |
Non-current liabilities due within one year | 69,903 | 69,490 | |
Other current liabilities | 19,997 | - | |
Total current liabilities | 639,266 | 576,374 | |
Non-current liabilities: | |||
Long-term loans | 52,870 | 39,625 | |
Debentures payable | 19,349 | 19,157 | |
Lease liabilities | 178,774 | 177,674 | |
Provisions | 43,375 | 43,163 | |
Deferred tax liabilities | 7,273 | 6,809 | |
Other non-current liabilities | 18,966 | 15,364 | |
Total non-current liabilities | 320,607 | 301,792 | |
Total liabilities | 959,873 | 878,166 | |
Shareholders' equity: | |||
Share capital | 121,071 | 121,071 | |
Capital reserve | 122,128 | 122,127 | |
Other comprehensive income | (7,983) | (321) | |
Specific reserve | 2,365 | 1,741 | |
Surplus reserves | 207,423 | 207,423 | |
Retained earnings | 267,346 | 287,128 | |
Total equity attributable to shareholders of the Company | 712,350 | 739,169 | |
Minority interests | 135,316 | 137,736 | |
Total shareholders' equity | 847,666 | 876,905 | |
Total liabilities and shareholders' equity | 1,807,539 | 1,755,071 | |
Zhang Yuzhuo Ma Yongsheng | Shou Donghua | ||
Chairman President Chief Financial Officer
|
| ||
Balance Sheet | ||
as at 31 March 2020 | ||
Prepared by: China Petroleum & Chemical Corporation | ||
Units: million Currency: RMB Type: unaudited | ||
Items | At 31 March 2020 | At 31 December 2019 |
Current assets： |
| |
Cash at bank and on hand | 70,783 | 54,072 |
Derivative financial assets | 940 | 940 |
Accounts receivable | 22,184 | 21,544 |
Receivables financing | 751 | 207 |
Prepayments | 3,685 | 2,665 |
Other receivables | 75,833 | 78,872 |
Inventories | 40,926 | 49,116 |
Other current assets | 22,555 | 25,149 |
Total current assets | 237,657 | 232,565 |
Non-current assets： | ||
Long-term equity investments | 306,225 | 304,687 |
Other equity instrument investments | 395 | 395 |
Fixed assets | 284,804 | 291,547 |
Construction in progress | 62,353 | 60,493 |
Right-of-use assets | 112,968 | 112,832 |
Intangible assets | 8,654 | 8,809 |
Long-term deferred expenses | 2,390 | 2,630 |
Deferred tax assets | 15,847 | 7,315 |
Other non-current assets | 2,314 | 2,490 |
Total non-current assets | 795,950 | 791,198 |
Total assets | 1,033,607 | 1,023,763 |
Current liabilities： | ||
Short-term loans | 64,609 | 19,919 |
Derivative financial liabilities | 157 | 157 |
Bills payable | 4,862 | 4,766 |
Accounts payable | 70,495 | 75,352 |
Contract liabilities | 4,769 | 5,112 |
Employee benefits payable | 2,903 | 1,214 |
Taxes payable | 25,033 | 43,025 |
Other payables | 108,861 | 118,064 |
Non-current liabilities due within one year | 59,775 | 59,596 |
Other current liabilities | 19,997 | - |
Total current liabilities | 361,461 | 327,205 |
Non-current liabilities： | ||
Long-term loans | 12,125 | 12,680 |
Debentures payable | 7,000 | 7,000 |
Lease liabilities | 108,782 | 107,783 |
Provisions | 34,825 | 34,514 |
Other non-current liabilities | 4,337 | 4,471 |
Total non-current liabilities | 167,069 | 166,448 |
Total liabilities | 528,530 | 493,653 |
Shareholders' equity： | ||
Share capital | 121,071 | 121,071 |
Capital reserve | 68,841 | 68,841 |
Other comprehensive income | (6,322) | 1,181 |
Specific reserve | 1,241 | 949 |
Surplus reserves | 207,423 | 207,423 |
Retained earnings | 112,823 | 130,645 |
Total shareholders' equity | 505,077 | 530,110 |
Total liabilities and shareholders' equity | 1,033,607 | 1,023,763 |
Zhang Yuzhuo Ma Yongsheng Shou Donghua | ||
Chairman President Chief Financial Officer
| ||
Consolidated Income Statement for the three-month period ended 31 March 2020 |
Prepared by: China Petroleum & Chemical Corporation |
Units: million Currency: RMB Type: unaudited |
Items | Three-month period ended 31 March 2020 |
Three-month period ended 31 March 2019 |
I. Operating income | 555,502 | 717,579 |
II. Total Operating costs | 583,107 | 693,269 |
Including: Operating costs | 499,274 | 596,412 |
Taxes and surcharges | 49,691 | 60,459 |
Selling and distribution expenses | 14,653 | 14,748 |
General and administrative expenses | 14,128 | 15,485 |
Research and development costs | 1,083 | 1,292 |
Financial expenses | 2,010 | 2,330 |
Exploration expenses, including dry holes | 2,268 | 2,543 |
Add: Other income | 1,100 | 761 |
Investment income | 153 | 1,285 |
Gains/(losses) from changes in fair value | 8,342 | (2,226) |
Credit impairment losses | 5 | (19) |
Impairment losses | (10,360) | 136 |
Asset disposal gains/(losses) | 60 | (64) |
III. Operating profit | (28,305) | 24,183 |
Add: Non-operating income | 215 | 243 |
Less: Non-operating expenses | 471 | 416 |
IV. Profit before taxation | (28,561) | 24,010 |
Less: Income tax expense | (7,529) | 5,539 |
V. Net profit | (21,032) | 18,471 |
Classification by going concern: | ||
(i) Continuous operating net profit | (21,032) | 18,471 |
(ii) Termination of net profit | - | - |
Classification by ownership: | ||
(i)Equity shareholders of the Company | (19,782) | 14,763 |
(ii) Minority interests | (1,250) | 3,708 |
Consolidated Income Statement (Continued)
VI. Other comprehensive income | (7,360) | 3,759 | |
Items that may not be reclassified subsequently to profit or loss: | |||
Changes in fair value of other equity instrument investments | - | 1 | |
Items that may be reclassified subsequently to profit or loss: | |||
Other comprehensive income that can be converted into profit or loss under the equity method | (76) | 66 | |
Cash flow hedges | (8,401) | 4,853 | |
Foreign currency translation differences | 1,117 | (1,161) | |
VII. Total comprehensive income | (28,392) | 22,230 | |
Equity shareholders of the Company | (27,103) | 19,029 | |
Minority interests | (1,289) | 3,201 | |
VIII. Earnings per share: | |||
(i) Basic earnings per share (RMB/Share) | (0.163) | 0.122 | |
(ii) Diluted earnings per share (RMB/Share) | (0.163) | 0.122 | |
Zhang Yuzhuo Ma Yongsheng Shou Donghua |
| ||
Chairman President Chief Financial Officer
|
| ||
Income Statement for the three-month period ended 31 March 2020 | ||
Prepared by: China Petroleum & Chemical Corporation | ||
Units: million Currency: RMB Type: unaudited | ||
Items | Three-month period ended 31 March 2020 | Three-month period ended 31 March 2019 |
I.Operating income | 199,942 | 249,978 |
Less: Operating costs | 171,987 | 191,844 |
Taxes and surcharges | 32,996 | 40,952 |
Selling and distribution expenses | 724 | 754 |
General and administrative expenses | 6,992 | 7,612 |
Research and development costs | 1,034 | 1,197 |
Financial expenses | 2,050 | 1,635 |
Exploration expenses, including dry holes | 1,936 | 2,429 |
Add: Other income | 896 | 631 |
Investment income | 814 | 1,777 |
Gains from changes in fair value | 400 | 20 |
Credit impairment losses | 31 | 5 |
Impairment losses | (7,992) | - |
Asset disposal gains/ (losses) | 1 | (1) |
II. Operating profit | (23,627) | 5,987 |
Add: Non-operating income | 33 | 34 |
Less: Non-operating expenses | 232 | 147 |
III. Profit before taxation | (23,826) | 5,874 |
Less: Income tax expense | (6,002) | 1,003 |
IV. Net profit | (17,824) | 4,871 |
(i) Continuous operating net profit | (17,824) | 4,871 |
(ii) Termination of net profit | - | - |
V. Other comprehensive income | (7,387) | 817 |
Items that may be reclassified subsequently to profit or loss | ||
Other comprehensive loss that can be converted into profit or loss under the equity method | 49 | (33) |
Cash flow hedges | (7,436) | 850 |
VI. Total comprehensive income | (25,211) | 5,688 |
Zhang Yuzhuo Ma Yongsheng Shou Donghua |
Chairman President Chief Financial Officer
|
Consolidated Cash Flow Statement | ||
for the three-month period ended 31 March 2020 | ||
Prepared by: China Petroleum & Chemical Corporation | ||
Units: million Currency: RMB Type: unaudited | ||
Items | Three-month period ended 31 March 2020 | Three-month period ended 31 March 2019 |
I. Cash flows from operating activities: |
|
|
Cash received from sale of goods and rendering of services | 600,228 | 760,693 |
Refund of taxes and levies | 818 | 760 |
Other cash received relating to operating activities | 35,326 | 31,379 |
Sub-total of cash inflows | 636,372 | 792,832 |
Cash paid for goods and services | (544,121) | (625,310) |
Cash paid to and for employees | (16,826) | (17,224) |
Payments of taxes and levies | (84,522) | (125,101) |
Other cash paid relating to operating activities | (59,028) | (39,806) |
Sub-total of cash outflows | (704,497) | (807,441) |
Net cash flow from operating activities | (68,125) | (14,609) |
II.Cash flows from investing activities: | ||
Cash received from disposal of investments | 3,402 | 9,636 |
Cash received from returns on investments | 986 | 1,288 |
Net cash received from disposal of fixed assets, intangible assets and other long-term assets | 18 | 24 |
Other cash received relating to investing activities | 19,162 | 13,165 |
Sub-total of cash inflows | 23,568 | 24,113 |
Cash paid for acquisition of fixed assets, intangible assets and other long-term assets | (22,327) | (23,514) |
Cash paid for acquisition of investments | (1,672) | (1,793) |
Other cash paid relating to investing activities | (14,094) | (24,388) |
Sub-total of cash outflows | (38,093) | (49,695) |
Net cash flow from investing activities | (14,525) | (25,582) |
III.Cash flows from financing activities: | ||
Cash received from capital contributions | 260 | 94 |
Including: Cash received from minority shareholders' capital contributions to subsidiaries | 260 | 94 |
Cash received from borrowings | 274,615 | 149,622 |
Consolidated Cash Flow Statement (Continued)
Other cash received relating to financing activities | 276 | 190 |
Sub-total of cash inflows | 275,151 | 149,906 |
Cash repayments of borrowings | (172,518) | (118,511) |
Cash paid for dividends, profits distribution or interest | (1,557) | (1,396) |
Including: Subsidiaries' cash payments for distribution of dividends or profits to minority shareholders | (160) | (235) |
Other cash paid relating to financing activities | (3,492) | (630) |
Sub-total of cash outflows | (177,567) | (120,537) |
Net cash flow from financing activities | 97,584 | 29,369 |
IV. Effects of changes in foreign exchange rate | 553 | (340) |
V. Net increase/(decrease) in cash and cash equivalents | 15,487 | (11,162) |
Add：Initial balance of cash and cash equivalents | 60,313 | 111,922 |
VI. Ending balance of cash and cash equivalents | 75,800 | 100,760 |
Zhang Yuzhuo Ma Yongsheng Shou Donghua | ||
Chairman President Chief Financial Officer
| ||
Cash Flow Statement | ||
for the three-month period ended 31 March 2020 | ||
Prepared by: China Petroleum & Chemical Corporation | ||
Units: million Currency: RMB Type: unaudited | ||
Items | Three-month period ended 31 March 2020 | Three-month period ended 31 March 2019 |
I.Cash flows from operating activities: |
|
|
Cash received from sale of goods and rendering of services | 217,331 | 280,152 |
Refund of taxes and levies | 798 | 519 |
Other cash received relating to operating activities | 1,619 | 757 |
Sub-total of cash inflows | 219,748 | 281,428 |
Cash paid for goods and services | (175,248) | (208,261) |
Cash paid to and for employees | (8,835) | (9,274) |
Payments of taxes and levies | (53,244) | (76,898) |
Other cash paid relating to operating activities | (5,349) | (2,939) |
Sub-total of cash outflows | (242,676) | (297,372) |
Net cash flow from operating activities | (22,928) | (15,944) |
II.Cash flows from investing activities: | ||
Cash received from disposal of investments | 4,759 | 9,285 |
Cash received from returns on investments | 1,224 | 1,270 |
Net cash received from disposal of fixed assets, intangible assets and other long-term assets | 3 | 3 |
Other cash received relating to investing activities | 44,575 | 9,933 |
Sub-total of cash inflows | 50,561 | 20,491 |
Cash paid for acquisition of fixed assets, intangible assets and other long-term assets | (9,307) | (7,459) |
Cash paid for acquisition of investments | (2,807) | (1,376) |
Other cash paid relating to investing activities | (47,607) | (10,800) |
Sub-total of cash outflows | (59,721) | (19,635) |
Net cash flow from investing activities | (9,160) | 856 |
III.Cash flows from financing activities: | ||
Cash received from borrowings | 130,458 | 39,186 |
Other cash received relating to financing activities | 57,475 | - |
Sub-total of cash inflows | 187,933 | 39,186 |
Cash repayments of borrowings | (66,328) | (35,016) |
Cash paid for dividends or interest | (875) | (1,476) |
Other cash paid relating to financing activities | (72,108) | (266) |
Sub-total of cash outflows | (139,311) | (36,758) |
Net cash flow from financing activities | 48,622 | 2,428 |
Cash Flow Statement (Continued)
IV. Net increase/(decrease) in cash and cash equivalents | 16,534 | (12,660) |
Add：Initial balance of cash and cash equivalents | 38,616 | 59,120 |
V. Ending balance of cash and cash equivalents | 55,150 | 46,460 |
Zhang Yuzhuo Ma Yongsheng Shou Donghua | ||
Chairman President Chief Financial Officer
| ||
Segment Reporting for the three-month period ended 31 March 2020 | |||
Prepared by: China Petroleum & Chemical Corporation | |||
Units: million Currency: RMB Type: unaudited | |||
Items | Three-month period ended 31 March 2020 | Three-month period ended 31 March 2019 | |
Income from principal operations | |||
Exploration and production | |||
External sales | 26,944 | 29,367 | |
Inter-segment sales | 18,238 | 22,089 | |
Subtotal | 45,182 | 51,456 | |
Refining | |||
External sales | 25,145 | 34,002 | |
Inter-segment sales | 217,468 | 255,752 | |
Subtotal | 242,613 | 289,754 | |
Marketing and distribution | |||
External sales | 248,725 | 321,636 | |
Inter-segment sales | 1,226 | 965 | |
Subtotal | 249,951 | 322,601 | |
Chemicals | |||
External sales | 71,815 | 110,990 | |
Inter-segment sales | 10,884 | 17,121 | |
Subtotal | 82,699 | 128,111 | |
Corporate and others | |||
External sales | 170,003 | 205,504 | |
Inter-segment sales | 131,839 | 154,677 | |
Subtotal | 301,842 | 360,181 | |
Elimination of inter-segment sales | (379,655) | (450,604) | |
Consolidated income from principal operations | 542,632 | 701,499 | |
Income from other operations | |||
Exploration and production | 1,272 | 1,821 | |
Refining | 932 | 1,251 | |
Marketing and distribution | 6,939 | 8,850 | |
Chemicals | 3,401 | 3,733 | |
Corporate and others | 326 | 425 | |
Consolidated income from other operations | 12,870 | 16,080 | |
Segment Reporting (Continued)
Consolidated operating income | 555,502 | 717,579 |
Operating (loss)/profit | ||
By segment | ||
Exploration and production | 404 | 1,581 |
Refining | (26,299) | 11,481 |
Marketing and distribution | (2,621) | 7,990 |
Chemicals | (1,767) | 6,827 |
Corporate and others | (5,667) | (582) |
Elimination | - | (540) |
Total segment operating profit | (35,950) | 26,757 |
Investment income | ||
Exploration and production | 476 | 777 |
Refining | (680) | (394) |
Marketing and distribution | 657 | 215 |
Chemicals | (66) | 1,047 |
Corporate and others | (234) | (360) |
Total segment investment income | 153 | 1,285 |
Financial expenses | (2,010) | (2,330) |
Gains/(losses) from changes in fair value | 8,342 | (2,226) |
Asset disposal gains/(losses) | 60 | (64) |
Other income | 1,100 | 761 |
Operating profit | (28,305) | 24,183 |
Add: Non-operating income | 215 | 243 |
Less: Non-operating expenses | 471 | 416 |
Profit before taxation | (28,561) | 24,010 |
4.2 Quarterly financial statements prepared under International Financial Reporting
Standards (IFRS)
Consolidated Income Statement for the three-month period ended 31 March 2020 | ||
Prepared by: China Petroleum & Chemical Corporation | ||
Units: million Currency: RMB Type: unaudited | ||
Items | Three-month period ended 31 March 2020 | Three-month period ended 31 March 2019 |
Turnover and other operating revenues | ||
Turnover | 542,632 | 701,499 |
Other operating revenues | 12,870 | 16,080 |
Subtotal | 555,502 | 717,579 |
Operating expenses | ||
Purchased crude oil, products and operating supplies and expenses | (484,322) | (572,138) |
Selling, general and administrative expenses | (10,488) | (11,575) |
Depreciation, depletion and amortisation | (25,070) | (25,998) |
Exploration expenses, including dry holes | (2,268) | (2,543) |
Personnel expenses | (18,844) | (17,361) |
Taxes other than income tax | (49,691) | (60,459) |
Other operating revenue/(expense), net | 8,876 | (2,664) |
Total operating expenses | (581,807) | (692,738) |
Operating profit | (26,305) | 24,841 |
Finance costs | ||
Interest expense | (3,896) | (4,301) |
Interest income | 1,085 | 1,924 |
Foreign currency exchange loss, net | 801 | 47 |
Net finance costs | (2,010) | (2,330) |
Investment income | 29 | 55 |
Share of profits less losses from associates and joint ventures | 472 | 2,232 |
Profit before taxation | (27,814) | 24,798 |
Income tax expense | 7,529 | (5,539) |
Profit for the period | (20,285) | 19,259 |
Attributable to： | ||
Owners of the Company | (19,145) | 15,468 |
Non-controlling interests | (1,140) | 3,791 |
Profit for the period | (20,285) | 19,259 |
Earnings per share | ||
Basic earnings per share (RMB) | (0.158) | 0.128 |
Diluted earnings per share (RMB) | (0.158) | 0.128 |
Consolidated Statement of Comprehensive Income for the three-month period ended 31 March 2020 | ||
Prepared by: China Petroleum & Chemical Corporation | ||
Units: million Currency: RMB Type: unaudited | ||
Items | Three-month period ended 31 March 2020 | Three-month period ended 31 March 2019 |
Profit for the period | (20,285) | 19,259 |
Other comprehensive income: | (7,360) | 3,759 |
Items that may not be reclassified subsequently to profit or loss: | ||
Equity investments at fair value through other comprehensive income | - | 1 |
Items that may be reclassified subsequently to profit or loss: | ||
Share of other comprehensive income of associates and joint ventures | (76) | 66 |
Cash flow hedges | (8,401) | 4,853 |
Foreign currency translation differences | 1,117 | (1,161) |
Total comprehensive income | (27,645) | 23,018 |
Attributable to: | ||
Shareholders of the Company | (26,466) | 19,734 |
Non-controlling interests | (1,179) | 3,284 |
Consolidated Balance Sheet as at 31 March 2020 | ||
Prepared by: China Petroleum & Chemical Corporation | ||
Units: million Currency: RMB Type: unaudited | ||
Items | At 31 March 2020 | At 31 December 2019 |
Non-current assets： | ||
Property, plant and equipment, net | 611,508 | 622,409 |
Construction in progress | 177,021 | 173,482 |
Right-of-use assets | 266,992 | 267,860 |
Goodwill | 8,716 | 8,697 |
Interest in associates | 96,691 | 95,737 |
Interest in joint ventures | 55,870 | 56,467 |
Financial assets at fair value through other comprehensive income | 1,525 | 1,521 |
Deferred tax assets | 29,343 | 17,616 |
Long-term prepayments and other non-current assets | 63,841 | 65,426 |
Total non-current assets | 1,311,507 | 1,309,215 |
Current assets: | ||
Cash and cash equivalents | 75,800 | 60,313 |
Time deposits with financial institutions | 62,973 | 67,614 |
Financial assets at fair value through profit and loss | 2,012 | 3,319 |
Derivatives financial assets | 14,459 | 837 |
Trade accounts receivable and bills receivable | 54,246 | 54,865 |
Financial assets at fair value through other comprehensive income | 8,746 | 8,622 |
Inventories | 183,277 | 192,442 |
Prepaid expenses and other current assets | 94,519 | 57,844 |
Total current assets | 496,032 | 445,856 |
Current liabilities： | ||
Short-term debts | 97,476 | 40,521 |
Loans from Sinopec Group Company and fellow subsidiaries | 73,290 | 43,289 |
Lease liabilities | 15,586 | 15,198 |
Derivatives financial liabilities | 26,362 | 2,729 |
Trade accounts payable and bills payable | 168,582 | 199,792 |
Contract liabilities | 137,563 | 126,735 |
Other payables | 119,729 | 144,846 |
Income tax payable | 678 | 3,264 |
Total current liabilities | 639,266 | 576,374 |
Consolidated Balance Sheet (Continued)
Net current liabilities | 143,234 | 130,518 |
Total assets less current liabilities | 1,168,273 | 1,178,697 |
Non-current liabilities： | ||
Long-term debts | 56,235 | 49,156 |
Loans from Sinopec Group Company and fellow subsidiaries | 15,984 | 9,626 |
Lease liabilities | 178,774 | 177,674 |
Deferred tax liabilities | 7,273 | 6,809 |
Provisions | 43,375 | 43,163 |
Other non-current liabilities | 20,024 | 16,434 |
Total non-current liabilities | 321,665 | 302,862 |
Total net assets | 846,608 | 875,835 |
Equity： | ||
Share capital | 121,071 | 121,071 |
Reserves | 590,272 | 617,079 |
Total equity attributable to shareholders of the Company | 711,343 | 738,150 |
Non-controlling interests | 135,265 | 137,685 |
Total equity | 846,608 | 875,835 |
Consolidated Statement of Cash Flows for the three-month period ended 31 March 2020 | ||
Prepared by: China Petroleum & Chemical Corporation | ||
Units: million Currency: RMB Type: unaudited | ||
Items | Three-month period ended 31 March 2020 | Three-month period ended 31 March 2019 |
Net cash generated from operating activities(a) | (68,125) | (14,609) |
Investing activities | ||
Capital expenditure | (20,432) | (21,855) |
Exploratory wells expenditure | (1,895) | (1,659) |
Purchase of investments, investments in associates and investments in joint ventures | (1,672) | (1,793) |
Proceeds from disposal of investments and investments in associates | 3,402 | 9,636 |
Proceeds from disposal of property, plant, equipment and other non-current assets | 18 | 24 |
Increase in time deposits with maturities over three months | (13,912) | (24,388) |
Decrease in time deposits with maturities over three months | 18,553 | 11,855 |
Interest received | 609 | 1,310 |
Investment and dividend income received | 986 | 1,288 |
Repayments of other investing activities | (182) | - |
Net cash used in investing activities | (14,525) | (25,582) |
Financing activities | ||
Proceeds from bank and other loans | 274,615 | 149,622 |
Repayments of bank and other loans | (172,518) | (118,511) |
Contributions to subsidiaries from non-controlling interests | 260 | 94 |
Distributions by subsidiaries to non-controlling interests | (160) | (319) |
Interest paid | (1,397) | (1,077) |
Payments made to acquire non-controlling interests | (1,117) | - |
Repayments of lease liabilities | (2,375) | (440) |
Proceeds from other financing activities | 276 | - |
Net cash used in financing activities | 97,584 | 29,369 |
Net increase/ (decrease) in cash and cash equivalents | 14,934 | (10,822) |
Cash and cash equivalents at 1 January | 60,313 | 111,922 |
Effect of foreign currency exchange rate changes | 553 | (340) |
Cash and cash equivalents at 31 March | 75,800 | 100,760 |
Note to consolidated statement of Cash Flows for the three-month period ended 31 March 2020 | ||
Prepared by: China Petroleum & Chemical Corporation | ||
Units: million Currency: RMB Type: unaudited | ||
(a) Reconciliation of profit before taxation to net cash generated from operating activities | ||
Items | Three-month period ended 31 March 2020 | Three-month period ended 31 March 2019 |
Operating activities | ||
Profit before taxation | (27,814) | 24,798 |
Adjustments for: | ||
Depreciation, depletion and amortisation | 25,070 | 25,998 |
Dry hole costs written off | 1,863 | 1,836 |
Share of profits from associates and joint ventures | (472) | (2,232) |
Investment income | (29) | (55) |
Interest income | (689) | (1,924) |
Interest expense | 3,683 | 4,301 |
Gain/(loss) on foreign currency exchange rate changes and derivative financial instruments | (8,589) | 1,295 |
Gain/(loss) on disposal of property, plant, equipment and other non-current assets, net | (3) | 85 |
Impairment reversal on assets | 10,360 | (136) |
Credit impairment losses | (5) | 19 |
Operating profit before change of operating capital | 3,375 | 53,985 |
Accounts receivable and other current assets | (48,286) | (7,199) |
Inventories | (1,163) | (30,127) |
Accounts payable and other current liabilities | (16,994) | (24,314) |
Subtotal | (63,068) | (7,655) |
Income tax paid | (5,057) | (6,954) |
Net cash generated from operating activities | (68,125) | (14,609) |
Segment Reporting for the three-month period ended 31 March 2020 | ||
Prepared by: China Petroleum & Chemical Corporation | ||
Units: million Currency: RMB Type: unaudited | ||
Items | Three-month period ended 31 March 2020 | Three-month period ended 31 March 2019 |
Turnover | ||
Exploration and production | ||
External sales | 26,944 | 29,367 |
Inter-segment sales | 18,238 | 22,089 |
Subtotal | 45,182 | 51,456 |
Refining | ||
External sales | 25,145 | 34,002 |
Inter-segment sales | 217,468 | 255,752 |
Subtotal | 242,613 | 289,754 |
Marketing and distribution | ||
External sales | 248,725 | 321,636 |
Inter-segment sales | 1,226 | 965 |
Subtotal | 249,951 | 322,601 |
Chemicals | ||
External sales | 71,815 | 110,990 |
Inter-segment sales | 10,884 | 17,121 |
Subtotal | 82,699 | 128,111 |
Corporate and others | ||
External sales | 170,003 | 205,504 |
Inter-segment sales | 131,839 | 154,677 |
Subtotal | 301,842 | 360,181 |
Elimination of inter-segment sales | (379,655) | (450,604) |
Turnover | 542,632 | 701,499 |
Other operating revenues | ||
Exploration and production | 1,272 | 1,821 |
Refining | 932 | 1,251 |
Marketing and distribution | 6,939 | 8,850 |
Chemicals | 3,401 | 3,733 |
Corporate and others | 326 | 425 |
Other operating revenues | 12,870 | 16,080 |
Turnover and other operating revenues | 555,502 | 717,579 |
Result | ||
Operating (loss)/profit | ||
Segment Reporting (Continued)
By segment | ||
Exploration and production | 1,518 | 2,143 |
Refining | (25,794) | 11,963 |
Marketing and distribution | (1,536) | 7,866 |
Chemicals | (1,568) | 6,953 |
Corporate and others | 1,075 | (3,544) |
Elimination | - | (540) |
Total segment operating profit | (26,305) | 24,841 |
Share of profits from associates and joint ventures | ||
Exploration and production | 476 | 777 |
Refining | (682) | (404) |
Marketing and distribution | 287 | 247 |
Chemicals | (76) | 1,061 |
Corporate and others | 467 | 551 |
Aggregate share of profits from associates and joint ventures | 472 | 2,232 |
Investment income/(losses) | ||
Exploration and production | - | (1) |
Refining | 2 | 10 |
Marketing and distribution | 14 | 45 |
Chemicals | 8 | 1 |
Corporate and others | 5 | - |
Aggregate investment income | 29 | 55 |
Net finance costs | (2,010) | (2,330) |
Profit before taxation | (27,814) | 24,798 |
4.3 Differences between Consolidated Financial Statements prepared in accordance with the accounting policies complying with CASs and IFRS (unaudited)
Other than the differences in the classifications of certain financial statements captions and the accounting for the items described below, there are no material differences between the Group's consolidated financial statements prepared in accordance with the accounting policies complying with CASs and IFRS. The reconciliation presented below is included as supplemental information, is not required as part of the basic financial statements and does not include differences related to classification, presentation or disclosures. Such information has not been subject to independent audit or review. The major differences are:
(i) Government Grants
Under CASs, grants from the government are credited to capital reserve if required by relevant governmental regulations. Under IFRS, government grants relating to the purchase of fixed assets are recognized as deferred income and are transferred to the income statement over the useful life of these assets.
(ii) Safety Production Fund
Under CASs, safety production fund should be recognized in profit or loss with a corresponding increase in reserve according to PRC regulations. Such reserve is reduced for expenses incurred for safety production purposes or, when safety production related fixed assets are purchased, is reduced by the purchased cost with a corresponding increase in the accumulated depreciation. Such fixed assets are not depreciated thereafter. Under IFRS, payments are expensed as incurred, or capitalised as fixed assets and depreciated according to applicable depreciation methods.
Effects of major differences between the net profit under CASs and the profit for the period under IFRS are analysed as follows:
Prepared by: China Petroleum & Chemical Corporation
Units: million Currency: RMB Type: unaudited | ||
Items | Three-month period ended 31 March 2020 | Three-month period ended 31 March 2019 |
Net profit under CASs | (21,032) | 18,471 |
Adjustments: | ||
Government grants (i) | 12 | 13 |
Safety production fund (ii) | 735 | 775 |
Profit for the period under IFRS | (20,285) | 19,259 |
Effects of major differences between the shareholders' equity under CASs and the total equity under IFRS are analysed as follows:
Units: million Currency: RMB Type: unaudited | ||
Items | At 31 March 2020 | At 31 December 2019 |
Shareholders' equity under CASs | 847,666 | 876,905 |
Adjustments: | ||
Government grants(i) | (1,058) | (1,070) |
Total equity under IFRS | 846,608 | 875,835 |