\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 028 China Petroleum & Chemical Corporation(600028) )
Event:
The company released the first quarterly report of 2022. In 2022q1, the company achieved an operating revenue of 771.4 billion yuan, a year-on-year increase of + 34% and a month on month increase of + 4.6%; The net profit attributable to the parent company was 22.6 billion yuan, a year-on-year increase of + 24% and a month on month increase of + 100%.
Comments:
Oil prices remained high and upstream performance increased significantly
In 2022q1, the upstream segment of the company achieved an operating profit of 10.5 billion yuan, a year-on-year increase of 345%, a month on month turn from loss to profit increase of 14.5 billion yuan, and the upstream performance in the first quarter hit a new high since 2014. The performance growth was mainly due to the tight supply, recovery of demand and superposition of geographical conflicts in the first quarter of 2022, which kept the oil price high. The average price of Brent crude oil futures in the first quarter was US $97.90/barrel, a year-on-year increase of + 60% and a month on month increase of + 23%. The company’s crude oil price was 89.02 US dollars / barrel, a year-on-year increase of + 62%; The price of natural gas was $8.14/thousand cubic feet, a year-on-year increase of + 15%. Seizing the opportunity of high oil prices, the company continued to promote high-quality exploration, accelerate the construction of production efficiency, made positive progress in stabilizing oil, increasing gas and improving efficiency, and made important breakthroughs in oil and gas exploration in Shunbei, Shengli, Sichuan Basin and other areas; In terms of development, strengthen the system optimization of the whole natural gas industry chain and continuously improve the level of quantity and efficiency. 2022q1 company produced 69.07 million barrels of crude oil, with a year-on-year increase of + 1.0% and a month on month increase of – 2.9%; The production of natural gas was 313.94 billion cubic feet, with a year-on-year increase of + 7.7% and a month on month increase of – 2.7%.
Oil refining demand recovered, performance rebounded, and steadily promoted “oil conversion”
The oil refining sector of 2022q1 company achieved an operating profit of 22.1 billion yuan, with a year-on-year increase of + 13% and a month on month increase of + 88%. The growth of performance is mainly due to the steady recovery of China’s demand for refined oil in the first quarter of 2022. The company has steadily promoted “oil conversion” and “oil to special”, maintained the high load operation of the unit and continued to promote the construction of hydrogen supply projects. In 2022q1, the company processed 456 million barrels of crude oil, with a year-on-year increase of + 2.7% and a month on month increase of – 0.6%. It produced 1648, 1572 and 5.16 million tons of steam, diesel and kerosene respectively, with a year-on-year increase of + 0.7%, + 9.6% and + 3.4% and a month on month increase of + 2.1%, – 7.1% and + 13.4% respectively; The production diesel to steam ratio was 0.95, with a month on month decrease of 0.10.
The chemical business turned losses into profits month on month, and the proportion of high value-added products increased
The chemical sector of 2022q1 company realized an operating profit of 1.157 billion yuan, a year-on-year – 84%, an increase of 5.615 billion yuan from loss to profit, which was due to the recovery of downstream demand in the first quarter. The company’s production of synthetic resin, synthetic fiber + 1.6%, + 2.6%, + 6.6%, + 2.6%, + 2.6%, + 6.6%, + 2.6%, + 6.6%, + 2.6%, + 6.6%, + 2.6%, + 6.6%, + 2.6%, + 6.6.6% respectively. The company has closely connected production and marketing, increased export efforts, adjusted maintenance arrangements, made every effort to increase the production of EVA, CIS polybutadiene rubber, 1,4-butanediol and other products with strong profitability, continuously increased the proportion of high value-added products, and actively promoted the construction of advantageous and advanced production capacity.
Improve the sales network of refined oil and speed up the construction of “oil, gas, hydrogen and electricity service” comprehensive energy charging station
In 2022q1, the company’s sales segment achieved an operating profit of 9.318 billion yuan, a year-on-year increase of + 16%, turning losses into profits, an increase of 9.742 billion yuan month on month. The total sales volume of refined oil products in China of 2022q1 company was 51.02 million tons, with a year-on-year increase of – 1.8% and a month on month increase of – 5.9%, of which the retail volume was 27.34 million tons, with a year-on-year increase of + 0.7% and a month on month increase of – 10.7%. The sub sales volume of direct sales was 13.72 million tons, with a year-on-year increase of + 6.5% and a month on month increase of + 6.9%. The gas volume of a single station was 3559 tons / year. The company actively promotes the construction of “oil, gas, hydrogen and electricity service” comprehensive energy adding station and speeds up the construction of new energy service network. Continue to promote Wuxi Online Offline Communication Information Technology Co.Ltd(300959) integration, accelerate the construction of a new economic business model and enhance network value.
Capital expenditure increased in an orderly manner and continued to increase investment in upstream exploration: the total capital expenditure of 2022q1 company was 25.38 billion yuan, a year-on-year increase of + 10%; Among them, the capital expenditure of upstream, oil refining, sales and chemical sectors was 15.25 billion yuan, 6.03 billion yuan, 8.4 billion yuan and 2.3 billion yuan respectively, with a year-on-year increase of + 69%, – 21%, – 71% and + 28% respectively. The company has significantly increased its upstream exploration expenditure, which is mainly used for the construction of crude oil production capacity such as Shunbei and Tahe, natural gas production capacity such as West Sichuan and Dongsheng, and the construction of storage and transportation facilities such as Longkou LNG, laying a foundation for the further growth of the company’s oil and gas production.
Profit forecast, valuation and rating: we maintain the company’s profit forecast. It is estimated that the net profit attributable to the parent company in 22-24 years will be 73.4/75.4/77.8 billion yuan and EPS will be 0.61/0.62/0.64 yuan / share respectively. The company is the leader of China Petroleum & Chemical Corporation(600028) chemical industry. With the continuous increase of capital expenditure and the gradual increase of new energy layout, the company has broad growth prospects, so it maintains the “buy” rating of A-Shares and H shares.
Risk tip: downside risk of crude oil price and downside risk of refined oil and chemical products.
