Sinopec (600028): Natural gas and chemicals continue to increase production in line with expected growth

Sinopec (600028): Natural gas and chemicals continue to increase production in line with expected growth

Event: The company announced that it realized revenue of 28911 in 2018.

800 million, an annual increase of 22.

5%, net profit attributable to mother 630.

9 billion, an annual increase of 23.


Dividend paid up and down 0.

26 yuan, the initial dividend of 508.

5 billion.

Rising oil and gas driven revenue growth, Q4 was affected by the Lianhua incident and oil prices: the company’s oil and gas equivalent output increased slightly in 2018.

6%, the 厦门夜网 output of refined oil increased by 2.

7%, refined oil sales fell 0.

2%, the output of chemical products fell by 0%.


Revenues from the exploration and development, refining, chemicals, marketing and distribution segments increase each year.


Rising oil prices have driven upward and downstream prices. The average price of Brent crude oil in 2018 was 71.

0 USD / barrel, up 31 before.


Expenses during 20184.

8%, 1 percentage point reduction per year.

In the fourth quarter, due to the continued drop in oil prices and the impact of the Lianhua event, the single-quarter performance was alternated 152.

700 million.

Lianhua expects contradictions 40.

2 billion, a previous loss of 78.

8 billion.

The Lianhua incident is a one-time impact. Lianhua represents the frontline level of crude oil trade in China. After the incident, the company’s risk management and control will inevitably be stricter.

As oil prices stabilize and improve, the company’s performance is expected to continue to improve ahead of time.

Crude oil production remained stable, and natural gas and chemical products grew rapidly: Domestic natural gas demand maintained rapid growth, and the annual report showed that the apparent internal natural gas consumption was 280.3 billion cubic meters, increasing continuously18.


Apparent consumption of refined oil 3.

2.5 billion tons, an annual increase of 6.


The company’s planned capital expenditure for 2019 is 136.3 billion, of which the exploration and development segment is 59.6 billion, an increase of 17.4 billion; the refining segment is 27.9 billion, which has remained flat for a long time; the marketing and distribution segment is 21.8 billion, an increase of 4 billion; the chemical segment is 23.3 billion, an increase of3.7 billion.
Production of crude oil is planned for 20192.

8.8 billion barrels; natural gas production is 1019.1 billion cubic feet; processed crude oil2.4.6 billion tons; producing 1212 ethylene additives.

The company seized the opportunity of increasing demand for natural gas and chemical products, focused on the production of shale gas projects and gas storage, accelerated the implementation of major projects such as Sinochem Refining and Chemicals, and maintained the growth of natural gas and refining chemical production and sales.

The listing of the sales sector continues to advance, and future development is expected: In 2014, the company announced that the sales company had dated 1070 funds for 25 investors.

9.4 billion, accounting for 29 after the capital increase.


On 25, 2015, investors paid a total of 1,050 in payment.

4.4 billion (about 29 sales companies.

58% equity), which is equivalent to an estimated 355.1 billion after the investment.

The company announced in 2017 that Sinopec Sales Co., Ltd. plans to list 10% of its shares overseas.

The annual report shows that the net assets of the sales company are 2080.

700 million, net profit 219.

9 billion.

After the sales segment has dated private capital, explore the new model of “Internet + gas stations + convenience stores + integrated services”. Non-oil business maintains rapid growth. Considering the influence of Sinopec’s gas station brands, it will enhance the vitality of sales business and assets after independent listing.Estimated level.

Investment suggestion: EPS 0 is expected in 2019-2021.



64 yuan, maintain Buy-A rating, 6-month target price of 6.

6 yuan, corresponding to PE 11/10/10 times.

Risk warning: Oil prices continue to fall, and demand for refined oil and chemicals has grown less than expected.