| Work Detail |
Sinopec Oilfield Service, the drilling and services unit of oil and gas giant China Petrochemical, has cut its full-year capital expenditure after posting a sharply steeper interim loss for the first six month as work dwindled amid falling global oil prices. Its net loss for the period more than tripled to 4.44 billion yuan, from a loss of 1.25 billion yuan last time. First-half revenue slid 9.2 per cent year-on-year to 18.7 billion yuan. The net loss was in line with a warning the company issued late last month, when it expected to post a 4.5 billion yuan figure. Sinopec Oilfield shares had lost 1.34 per cent to HK$1.47 by 10.20 am, compared to a 0.08 per cent gain in the Hang Seng Index. They have now fallen 27.6 per cent in the year so far, while the index is ahead 5.1 per cent. “Domestic and international oil companies apparently lack desire for investment and no obvious improvement will appear for workload and service prices,” the firm said of the industry’s outlook for the second-half, in a filing to Hong Kong’s bourse late on Tuesday. “The company will accelerate deepening the internal reforms... [and] will make further efforts to cut down costs and enhance technology innovation.” The firm recorded net cash outflow of 3.11 billion yuan from operating activities in the first-half, widened from 1.37 billion yuan. Its net debt-to-shareholder equity ratio surged to 70 per cent from 44 per cent. To reduce its outlays, the firm said it has cut its capital expenditure budget for the full-year to 2.7 billion yuan from the 3.45 billion yuan announced in March. It spent 0.9 billion yuan in the year’s first-half. All its business divisions were loss-making, with drilling engineering posting a pre-tax loss of 2.46 billion yuan, geophysical data collection booking a loss of 536.9 million yuan, compared to a loss of 390 million on well data logging and analysis, a loss of 416 million on downhole operations and a loss of 303.8 million yuan on engineering and construction. The firm said it has stepped up seeking work from customers other than listed sister firm China Petroleum & Chemical (Sinopec), and its non-Sinopec clients contributed over half its total revenue for the first time. First-half revenues from overseas projects grew 8.8 per cent year-on-year to 6.8 billion yuan. It signed overseas contracts worth US$1.71 billion in the half, of which just under half was in the Middle East. It plans to complete US$1 billion worth of overseas work this year. |
