CORPORATE INFORMATION

Transcription

1 CORPORATE INFORMATION Executive Directors Mr. Hong Zhi Ming Mr. Yang Shu Shan Mr. Dai Zhao Ming Mr. Zhai Xu Dong Mr. Zhan Hai Tao Non-executive Directors Mr. Gu Yong Jiang Mr. Wong Po Yan Mrs. Tam Wai Chu, Maria Mr. Guan Qing Jie Mr. Li Yue Ling Audit Committee Mr. Gu Yong Jiang Mr. Wong Po Yan Mrs. Tam Wai Chu, Maria Company Secretaries Mr. Zhan Hai Tao Mr. Lai Yang Chau, Eugene Auditors Deloitte Touche Tohmatsu Certified Public Accountants 26th Floor, Wing On Centre 111 Connaught Road Central Hong Kong Legal Advisers in Hong Kong Livasiri & Co. 8/F, Far East Finance Centre 16 Harcourt Road Hong Kong Statutory Address Clarendon House 2 Church Street Hamilton HM11 Bermuda Principal Place of Business in Hong Kong 1608 Citicorp Centre 18 Whitfield Road Causeway Bay Hong Kong Hong Kong Branch Share Registrar and Transfer Office Secretaries Limited 5th Floor, Wing On Centre 111 Connaught Road Central Hong Kong Listing Information The Stock Exchange of Hong Kong Limited Code: Sinopec Kantons Holdings Limited

2 INTERIM RESULTS The Board of Directors of Sinopec Kantons Holdings Limited (the Company ) is pleased to announce the unaudited consolidated results of the Company and its subsidiaries (the Group ) for the six months ended 30 June 2001 as follows: 2 CONDENSED CONSOLIDATED INCOME STATEMENT FOR THE SIX MONTHS ENDED 30 JUNE 2001 Six months ended NOTES HK$ 000 HK$ 000 (Unaudited) (Unaudited) Turnover 3 3,231,766 4,835,890 Cost of sales (3,012,118) (4,584,587 ) Jetty operating expenses (50,026) (64,666 ) Gross profit 169, ,637 Other revenue 5,756 5,422 Selling and administrative expenses (40,917) (37,229 ) Profit from operations 134, ,830 Finance costs (3,314) (13,374 ) Profit before taxation 131, ,456 Taxation 4 9,365 (14,245 ) Profit after taxation 140, ,211 Minority interest (29,169) (25,567 ) Net profit for the year 111, ,644 Dividends 5 20,737 Earnings per share cents 9.8 cents Interim Report 2001

3 CONDENSED CONSOLIDATED BALANCE SHEET AT 30 JUNE 2001 NOTES HK$ 000 HK$ 000 (Unaudited) (Audited) 3 NON-CURRENT ASSETS Property, plant and equipment 7 1,333,595 1,330,653 Operating rights 10,048 10,026 Goodwill 1,965 1,345,608 1,340,679 CURRENT ASSETS Inventories, at cost 113,850 15,139 Investment in a security Trade and other receivables 8 104,200 53,746 Amounts due from the Sinopec Group 214,425 64,629 Short-term pledged bank deposits and bank balance 59,329 Short-term bank deposits 42,103 49,027 Bank balances and cash 152, , , ,568 CURRENT LIABILITIES Trade and other payables 9 302, ,054 Amounts due to the Sinopec Group 78,057 32,326 Taxation 10,117 23,666 Bank borrowings - due within one year 10 27,606 54, , ,557 NET CURRENT ASSETS 209, ,011 1,555,054 1,488,690 CAPITAL AND RESERVES Share capital 103, ,683 Reserves 12 1,031, ,211 1,134,940 1,043,894 MINORITY INTEREST 251, ,380 NON-CURRENT LIABILITIES Bank borrowings - due after one year 10 28,422 56,229 Loan/advance from the Sinopec Group 140, , , ,416 1,555,054 1,488,690 Sinopec Kantons Holdings Limited

4 CONDENSED CONSOLIDATED STATEMENT OF RECOGNISED GAINS AND LOSSES FOR THE SIX MONTHS ENDED 30 JUNE HK$ 000 (Unaudited) Exchange gain arising on translation of operations in the People s Republic of China not recognised in the condensed consolidated income statement 440 Net profit for the period 111,343 Total recognised gains 111,783 Interim Report 2001

5 CONDENSED CONSOLIDATED CASH FLOW STATEMENT FOR THE SIX MONTHS ENDED 30 JUNE 2001 HK$ 000 (Unaudited) NET CASH INFLOW FROM OPERATING ACTIVITIES 50,958 5 NET CASH OUTFLOW FROM RETURNS ON INVESTMENTS AND SERVICING OF FINANCE (20,273 ) TAX PAID (4,185 ) NET CASH INFLOW FROM INVESTING ACTIVITIES 19,552 NET CASH INFLOW BEFORE FINANCING 46,052 NET CASH OUTFLOW FROM FINANCING (54,356 ) DECREASE IN CASH AND CASH EQUIVALENTS (8,304 ) CASH AND CASH EQUIVALENTS AT 1 JANUARY ,240 CASH AND CASH EQUIVALENTS AT 30 JUNE ,936 Sinopec Kantons Holdings Limited

6 NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE BASIS OF PREPARATION The condensed financial statements have been prepared in accordance with Statement of Standard Accounting Practice ( SSAP ) No. 25 Interim financial reporting issued by the Hong Kong Society of Accountants, except that in this first year of implementation of the Standard, as permitted by the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited, no comparative amounts have been presented for either: the condensed consolidated statement of recognised gains and loss; or the condensed consolidated cash flow statement 2. PRINCIPAL ACCOUNTING POLICIES The condensed financial statements have been prepared under the historical cost convention. The accounting policies adopted are consistent with those followed in the preparation of the Group s annual financial statements for the year ended 31 December 2000, except as described below. In the current period, the Group has adopted, for the first time, a number of new and revised Statements of Standard Accounting Practice issued by the Hong Kong Society of Accountants, which has resulted in the adoption of the following new/revised accounting policies. Dividends proposed or declared after the balance sheet date In accordance with SSAP No. 9 (Revised) Events after the Balance Sheet Date, dividends proposed or declared after the balance sheet date are not recognised as a liability at the balance sheet date, but are disclosed as a separate component of equity in the notes to the financial statements. Goodwill In the current period, the Group has adopted SSAP No. 30 Business Combinations and has elected not to restate goodwill (negative goodwill) previously eliminated against (credited to) reserves. Accordingly, goodwill arising on acquisitions prior to 1 January 2001 is held in reserves and will be charged to the income statement at the time of disposal of the relevant subsidiary, or at such time as the goodwill is determined to be impaired. Negative goodwill arising on acquisitions prior to 1 January 2001 will be credited to income at the time of disposal of the relevant subsidiary. Goodwill arising on acquisitions after 1 January 2001 is capitalised and amortised over its estimated useful life. Negative goodwill arising on acquisitions after 1 January 2001 is presented as a deduction from assets and will be released to income based on an analysis of the circumstances from which the balance resulted. Interim Report 2001

7 3. SEGMENTAL INFORMATION Turnover Six months ended Contributions to profit from operations Six months ended HK$ 000 HK$ 000 HK$ 000 HK$ Sales of crude oil, petroleum and petrochemical products 3,082,453 4,689,128 32,987 72,140 Crude oil jetty services rendered 149, , ,474 82,690 3,231,766 4,835, , ,830 Substantially all of the Group s activities are based in the People s Republic of China (the PRC ), including Hong Kong and Macau, and more than 90% of the Group s turnover and contribution to profit from operations are derived from the PRC for both periods. 4. TAXATION Six months ended HK$ 000 HK$ 000 The (credit) charge comprises: Hong Kong Profits Tax calculated at 16% on the estimated assessable profit for the period 2,893 5,432 PRC income tax Current period 2,853 8,813 Overprovision in prior periods (15,111) (12,258) 8,813 (9,365) 14,245 PRC income tax is calculated at the applicable rates prevailing. There was no significant unprovided deferred taxation for the period or at the balance sheet date. Sinopec Kantons Holdings Limited

8 5. DIVIDENDS The directors have determined that an interim dividend of HK$1.5 cents per share (2000: HK$1.5 cents) should be paid to the shareholders of the Company EARNINGS PER SHARE The calculation of the basic earnings per share is based on the net profit for the period of approximately HK$111,343,000 (2000: HK$101,644,000) and on 1,036,830,000 shares (2000: weighted average number of 1,037,436,758 shares) in issue during the period. Diluted earnings per share has not been presented because there were no dilutive potential ordinary shares in issue for both periods. 7. ADDITIONS TO PROPERTY, PLANT AND EQUIPMENT AND DEPRECIATION During the period, the Group spent approximately HK$40,288,000 (HK$28,412,000 for the six months ended 30 June 2000) on property, plant and equipment. During the period, depreciation of approximately HK$35,693,000 (HK$33,300,000 for the six months ended 30 June 2000) was charged in respect of the Group s property, plant and equipment. 8. TRADE AND OTHER RECEIVABLES The Group generally allows an average of 30 days to its crude oil trading customers and petrol station customers who satisfy credit evaluation. An aged analysis of trade and other receivables is as follows: HK$ 000 HK$ days 47,031 22, days 2,549 Trade receivables 49,580 22,389 Other receivables 54,620 31, ,200 53,746 Interim Report 2001

9 9. TRADE AND OTHER PAYABLES An aged analysis of trade and other payables is as follows: HK$ 000 HK$ days 192,121 9, days Trade payables 192,121 10,149 Other payables 110, , , , BANK BORROWINGS During the period, the Group made repayment of bank borrowings approximately HK$54,712, CAPITAL COMMITMENTS HK$ 000 HK$ 000 Capital expenditure in respect of the construction of the jetty facilities: Contracted for but not provided in the financial statements 8,756 20,770 Authorised but not contracted for 409 8,756 21, RESERVES Share Dividend Merger General Exchange Accumulated premium reserve reserve reserves reserve profits Total HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 HK$ 000 At 1 January ,189 23,444 45,596 (2,426) 378, ,330 Shares repurchased and cancelled (332) (332) Transfer 20,737 22,635 (22,635) 20,737 Goodwill arising on acquisition of subsidiaries (4,880) (4,880) Net profit for the year 181, ,645 Dividends (36,289) (36,289) At 31 December ,857 20,737 23,444 63,351 (2,426) 501, ,211 Net profit for the period 111, ,343 Dividends (20,737) (20,737) Exchange realignment At 30 June ,857 23,444 63,351 (1,986) 612,591 1,031,257 Sinopec Kantons Holdings Limited

10 INTERIM DIVIDEND The Board has recommended an interim dividend of HK$1.5 cents per share (2000: HK$1.5 cents) payable to the shareholders of the Company whose names appear on the Register of Members of the Company on 12 October CLOSURE OF REGISTER OF MEMBERS The Register of Members of the Company will be closed from Tuesday, 9 October 2001 to Friday, 12 October 2001 (both days inclusive), during which period no transfer of shares will be registered. In order to qualify for entitlement of the interim dividend recommended, all transfers accompanied by the relevant share certificates must be lodged with the Company s Hong Kong Branch Share Registrar, Secretaries Limited, 5/F Wing On Centre, 111 Connaught Road Central, Hong Kong for registration not later than 4:00 p.m. on Monday, 8 October Dividend will be despatched to shareholders on or about 30 October 2001 in the form of cheques. REVIEW OF RESULTS AND PROSPECTS For the six months ended 30 June 2001, the Group recorded satisfactory results, though the turnover amounted to HK$3,232,000,000, representing a decrease of 33% from HK$4,836,000,000 recorded in the corresponding period of the previous year. Profit after taxation reached HK$141,000,000, representing an increase of 10% from HK$127,000,000 recorded in the same period of the previous year. Profit attributable to shareholders amounted to HK$111,000,000, representing an increase of 10% from HK$102,000,000 recorded in the corresponding period of the previous year. During the first half of 2001, Huizhou Crude Oil Jetty transmitted 3,140,000 tonnes of crude oil, basically at the same level as that in the corresponding period of the previous year. Turnover amounted to HK$149,000,000, representing an increase of 2% over the same period of the previous year. Profit amounting to approximately HK$100,000,000, representing an increase of 23% over the corresponding period in the last year, was attributable to a decrease in the cost of the Jetty. As of 30 June 2001, the number of petrol stations operated by the Group in Guangdong Province increased to 48, representing an increase of 45% over the same period of the previous year. Turnover amounted to HK$389,000,000, representing an increase of 4% over the same period of the previous year. The loss of HK$1,960,000 was mainly due to the sluggish market of oil products in Guangdong Province and the flaws of the prevailing pricing system. The management considers that the foregoing is a short-term phenomenon and therefore is cautiously optimistic about the long-term development of petrol stations. During the first half of this year, the Group s sales of crude oil totalled 1,560,000 tonnes and sales revenue amounted to HK$2,353,000,000, representing a decrease of 38% and 37% respectively over the same period of the previous year; meanwhile, the Group s sales of petrochemical products amounted to 186,000 tonnes and sales revenue totalled HK$341,000,000, representing a decrease of 31% and 32% respectively over the same period of the previous year. A decline in the price of crude oil in the international market and a relatively large stock of crude oil and oil products in China are main reasons for the decrease of the Group s turnover. During the first half of 2001, the Group still achieved relatively good results even in times of continual deterioration of international economic condition, which was attributable to the effort made to significantly lower the operational costs and expenses. With regard to the outlook of the second half of the year, the Group will continue to maintain stable development of different aspects of its businesses, to augment its investment and to concentrate on the construction of oil storage tanks with storage capacity of millions of cubic metres in Huizhou Crude Oil Jetty. The management of the Group is confident that satisfactory results will be obtained in the future. Interim Report 2001

11 INTERESTS OF DIRECTORS AND SENIOR MANAGEMENT IN SHARES As of 30 June 2001, none of the directors, senior management or their related parties held, beneficially or non-beneficially, any of the shares issued by the Company or any of its associated companies which were required to be recorded in the register of directors interests in compliance with Section 29 of the Securities (Disclosure of Interests) Ordinance. The Company also has not granted to any directors, senior management or their spouses or children under 18 years of age any right to subscribe for the Company s shares. 11 SUBSTANTIAL SHAREHOLDERS As of 30 June 2001, shareholders holding shares representing 10% or more of the Company s share capital in issue as recorded in the Register of Substantial Shareholders Interests maintained by the Company and their reported interests pursuant to provisions of Section 16(1) of the Securities (Disclosure of Interests) Ordinance are as follows: Name Number of Ordinary Shares (Percentage of total shares in issue) Sinopec Kantons International Limited 750,000,000 (72.34%) Note: The entire issued share capital of Sinopec Kantons International Limited was held by China Petrochemical International Company Limited. The entire registered capital of China Petrochemical International Company Limited was held by China Petrochemical Corporation. The controlling interest in the registered capital of China Petrochemical Corporation was held by China Petroleum & Chemical Corporation. PURCHASE, SALE AND REDEMPTION OF SHARES During the period under review, neither the Company nor any of its subsidiaries purchased, sold or redeemed any of the Company s securities. CODE OF BEST PRACTICE None of the Directors of the Company is aware of any information that would indicate that the Company was not in compliance with the Code of Best Practice set forth in Appendix 14 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited during the reporting period. DISCLOSURE OF INFORMATION ON THE STOCK EXCHANGE s WEBSITE Information that is required by Paragraphs 45(1) to 45(3) of Appendix 16 of the Listing Rules will be released on the Stock Exchange of Hong Kong s website in due course. Hong Kong, 5 September 2001 By Order of the Board Hong Zhi Ming Chairman Sinopec Kantons Holdings Limited

12 12 INDEPENDENT REVIEW REPORT TO THE BOARD OF DIRECTORS OF SINOPEC KANTONS HOLDINGS LIMITED INTRODUCTION We have been instructed by the Company to review the interim financial report set out on page 2 to 9. DIRECTORS RESPONSIBILITIES The Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the Listing Rules ) require the preparation of an interim financial report to be in compliance with Statement of Standard Accounting Practice No. 25 ( SSAP 25 ) Interim Financial Reporting issued by the Hong Kong Society of Accountants. However, the Listing Rules permit departure from SSAP 25 in that comparative figures are not required for the first statement of recognised gains and losses or for the cash flow statement included in the first interim financial report relating to accounting periods ended on or after 1 July The interim financial report is the responsibility of, and has been approved by, the directors. REVIEW WORK PERFORMED We conducted our review in accordance with Statement of Auditing Standards 700 Engagements to Review Interim Financial Reports ( SAS 700 ) issued by the Hong Kong Society of Accountants. A review consists principally of making enquiries of group management and applying analytical procedures to the interim financial report and based thereon, assessing whether the accounting policies and presentation have been consistently applied unless otherwise disclosed. A review excludes audit procedures such as tests of controls and verification of assets, liabilities and transactions. It is substantially less in scope than an audit and therefore provides a lower level of assurance than an audit. Accordingly we do not express an audit opinion on the interim financial report. REVIEW CONCLUSION On the basis of our review which does not constitute an audit, we are not aware of any material modifications that should be made to the interim financial report for the six months ended 30 June Without modifying our review conclusion, we draw to your attention that the comparative condensed income statement for the six months ended 30 June 2001 disclosed in the interim financial report have not been reviewed in accordance with SAS 700. Deloitte Touche Tohmatsu Certified Public Accountants Hong Kong, 5 September 2001 Interim Report 2001