Sinopec Shanghai Petrochemical (Shanghai PETCHEM, 00338) reported a return to profitability for the six months ended 30 June 2026, reversing last year’s interim loss on the back of aggressive cost controls and product-mix optimisation.
Revenue and earnings • Operating income slipped 1.34 % year on year to RMB 38.99 billion. • Net profit attributable to shareholders reached RMB 300.43 million, a sharp turnaround from the RMB 462.13 million loss recorded in 1H25. • Basic and diluted EPS rebounded to RMB 0.028 from a loss per share of RMB 0.044. • Weighted-average ROE improved by 3.16 ppts to 1.29 %.
Cash flow and balance sheet • Operating activities consumed RMB 0.84 billion in cash versus an inflow of RMB 0.78 billion a year earlier, mainly on higher payments for feedstock and taxes. • Net outflow from investing activities stood at RMB 1.44 billion, reflecting increased capex and lower term-deposit redemptions. • Financing activities generated RMB 1.86 billion, helped by a RMB 2.14 billion net increase in borrowings and a RMB 600 million capital injection from minority shareholders. • Total assets grew 0.85 % to RMB 42.92 billion; net gearing eased to 42.85 % (end-2025: 44.42 %).
Operational highlights • Crude throughput fell 10.16 % to 5.68 million tonnes amid major refinery overhauls. • Aggregate output of main commodities dropped 11.42 % to 4.94 million tonnes, while ethylene production rose 19.79 % to 0.33 million tonnes following an ethylene plant revamp. • Segment sales: petroleum products RMB 26.43 billion (+0.88 %), chemical products RMB 10.40 billion (+22.25 %), trading of petrochemicals RMB 1.87 billion (-51.55 %). • Crude procurement cost averaged RMB 4,573.59 per tonne, up 14.29 %, with crude making up 71.91 % of cost of sales.
Capex and projects • 1H26 capital expenditure was RMB 925 million, focused on the Cogeneration Unit Clean & Efficiency Improvement Project and the Large-Tow Carbon Fibre base in Inner Mongolia. • Key upgrades include the comprehensive refining-to-chemicals transformation project and Phase I commissioning of the 30,000 tpa carbon-fibre facility, now producing qualified output.
Shareholder structure • Sinopec Corp. remained the controlling shareholder with a 51.81 % stake. • HKSCC Nominees held 28.23 %, while Corn Capital owned 1.90 %.
Management outlook The company expects the domestic petrochemical sector to face continued margin pressure in 2H26 due to volatile crude prices and new capacity additions. Management plans to safeguard profitability by: 1. Tightening safety, environmental and cost controls. 2. Further optimising crude sourcing and product slate, with focus on high-end chemicals. 3. Advancing major upgrade projects to boost integration and energy efficiency. 4. Deepening organisational reforms and performance-linked incentives to enhance productivity.
Dividend No interim dividend was declared for the period.
Compliance and governance Shanghai Petrochemical confirmed full compliance with Hong Kong’s Corporate Governance Code, and neither the company nor its subsidiaries conducted any share buy-backs, issues or redemptions during the period.