REG - China Pet &Chem Corp - Half-year Report <Origin Href="QuoteRef">600028.SS</Origin> - Part 7
29/08/2017 07:08
- Part 7: For the preceding part double click ID:nRSc0740Pf
Net assets attributable to 16,574 13,683 16,217 15,384 3,124 3,624 7,258 6,690 13,346 13,454
owners of the Company
Net assets attributable to - - - - - - 261 241 - -
minority interests
Share of net assets from 8,287 6,842 6,487 6,154 1,562 1,812 3,556 3,278 5,005 5,045
joint ventures
Other (iii) - - - - - - 637 743 - -
Carrying Amounts 8,287 6,842 6,487 6,154 1,562 1,812 4,193 4,021 5,005 5,045
6,931
13,346
13,454
Net assets attributable to
owners of the Company
16,574
13,683
16,217
15,384
3,124
3,624
7,258
6,690
13,346
13,454
Net assets attributable to
minority interests
-
-
-
-
-
-
261
241
-
-
Share of net assets from
joint ventures
8,287
6,842
6,487
6,154
1,562
1,812
3,556
3,278
5,005
5,045
Other (iii)
-
-
-
-
-
-
637
743
-
-
Carrying Amounts
8,287
6,842
6,487
6,154
1,562
1,812
4,193
4,021
5,005
5,045
Summarised income statement
Six-month periods ended 30 June FREP BASF-YPC Mansarovar Taihu YASREF
2017 2016 2017 2016 2017 2016 2017 2016 2017 2016
RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million
Turnover 24,412 20,176 10,440 7,860 852 496 5,933 4,418 28,509 20,476
Interest income 100 50 14 9 - 2 65 - 9 10
Interest expense (450) (473) (41) (99) - (3) (66) (21) (703) (582)
Profit/(loss) before taxation 3,825 3,707 2,218 951 (442) (804) 787 731 149 619
Tax expense (934) (905) (563) (233) 19 91 (211) (249) 29 28
Profit/(loss) for the period 2,891 2,802 1,655 718 (423) (713) 576 482 178 647
Other comprehensive (loss)/income - - - - (76) 82 (211) 108 (286) 302
Total comprehensive income/(loss) 2,891 2,802 1,655 718 (499) (631) 365 590 (108) 949
Dividends from joint ventures - - 329 155 - - - - - -
Share of net profit/(loss) from 1,445 1,401 662 287 (212) (357) 272 228 67 243
joint ventures
Share of other comprehensive - - - - (38) 41 (100) 51 (107) 113
(loss)/income from joint ventures
718
(499)
(631)
365
590
(108)
949
Dividends from joint ventures
-
-
329
155
-
-
-
-
-
-
Share of net profit/(loss) from
joint ventures
1,445
1,401
662
287
(212)
(357)
272
228
67
243
Share of other comprehensive
(loss)/income from joint ventures
-
-
-
-
(38)
41
(100)
51
(107)
113
The share of profit and other comprehensive income for the six-month period ended 30 June 2017 in all individually
immaterial joint ventures accounted for using equity method in aggregate was RMB 2,799 million (2016: RMB 1,740 million)
and RMB 533 million (2016: other comprehensive loss RMB 88 million) respectively. As at 30 June 2017, the carrying amount
of all individually immaterial joint ventures accounted for using equity method in aggregate was RMB 28,660 million (31
December 2016: RMB 26,822 million).
Note:
(i) Excluding accounts payable, other payables.
(ii) Excluding provisions.
(iii) Other reflects the excess of fair value of the consideration transferred over the Group's share of net fair value of
the investee's identifiable assets acquired and liabilities as of the acquisition date.
12 LONG-TERM EQUITY INVESTMENTS (Continued)
(c) Major financial information of principal associates
Summarised balance sheet and reconciliation to their carrying amounts in respect of the Group's principal associates:
Pipeline Ltd Sinopec Finance Zhongtian Synergetic Energy China Aviation Oil CIR
At 30 June 2017 At 31 December 2016 At 30 June 2017 At 31 December 2016 At 30 June 2017 At 31 December 2016 At 30 June 2017 At 31 December 2016 At 30 June 2017 At 31 December 2016
RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million
Current assets 13,252 11,835 150,790 149,457 8,686 7,292 16,698 13,115 5,477 5,120
Non-current assets 24,656 25,395 15,274 16,478 50,828 50,301 5,653 5,671 3,099 3,842
Current liabilities (4,367) (5,009) (141,825) (142,386) (7,220) (8,078) (7,496) (6,297) (949) (928)
Non-current liabilities (4) (4) (80) (88) (34,906) (32,137) (400) (417) (835) (883)
Net assets 33,537 32,217 24,159 23,461 17,388 17,378 14,455 12,072 6,792 7,151
Net assets attributable to 33,537 32,217 24,159 23,461 17,388 17,378 12,694 10,743 6,792 7,151
owners of the Company
Net assets attributable to - - - - - - 1,761 1,329 - -
minority interests
Share of net assets from associates 16,769 16,109 11,838 11,496 6,738 6,734 3,681 3,115 3,396 3,576
Other (iii) 6,691 6,691 - - - - - - - -
Carrying Amounts 23,460 22,800 11,838 11,496 6,738 6,734 3,681 3,115 3,396 3,576
1,761
1,329
-
-
Share of net assets from associates
16,769
16,109
11,838
11,496
6,738
6,734
3,681
3,115
3,396
3,576
Other (iii)
6,691
6,691
-
-
-
-
-
-
-
-
Carrying Amounts
23,460
22,800
11,838
11,496
6,738
6,734
3,681
3,115
3,396
3,576
Summarised income statement
Six-month periods ended 30 June Pipeline Ltd (iv) Sinopec Finance Zhongtian Synergetic Energy (v) China Aviation Oil CIR
2017 2017 2016 2017 2016 2017 2016 2017 2016
RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million
Turnover 3,037 1,641 1,217 - - 49,099 32,021 1,289 931
Profit/(loss) for the period 1,284 720 720 - - 2,475 1,973 (197) (905)
Other comprehensive (loss)/income - (22) (31) - - - - (162) 199
Total comprehensive income/(loss) 1,284 698 689 - - 2,475 1,973 (359) (706)
Dividends declared by associates - - - - - - - - -
Share of profit/(loss) from associates 642 353 353 - - 613 496 (99) (453)
Share of other comprehensive - (11) (15) - - - - (81) 100
(loss)/income from associates
-
-
-
Share of profit/(loss) from associates
642
353
353
-
-
613
496
(99)
(453)
Share of other comprehensive
(loss)/income from associates
-
(11)
(15)
-
-
-
-
(81)
100
The share of profit and other comprehensive income for the six-month period ended 30 June 2017 in all individually
immaterial associates accounted for using equity method in aggregate was RMB 1,109 million (2016: RMB 660 million) and RMB
81 million (2016: other comprehensive loss RMB 103 million) respectively. As at 30 June 2017, the carrying amount of all
individually immaterial associates accounted for using equity method in aggregate was RMB 18,989 million (31 December 2016:
RMB 18,395 million).
Note:
(iv) On 12 December 2016, the Group entered into the Capital Injection Agreement in relation to Sinopec Sichuan To East
China Gas Pipeline Co., Ltd. ("Pipeline Ltd"), a wholly-owned subsidiary of the Group, with China Life Insurance Company
Limited ("China Life") and SDIC Communications Holding Co., Ltd. ("SDIC Holding") (the "Capital Injection Agreement").
Thereafter, the Group's equity interest in Pipeline Ltd was diluted from 100% to 50%. Consequently, the Group has
deconsolidated Pipeline Ltd and started accounting for its 50% equity interest in Pipeline Ltd as an investment in
associate company. Management is in the process of allocating the fair value to identifiable assets and liabilities of
Pipeline Ltd. The accompanying summarised financial information of Pipeline Ltd (Note 12(c)) is based on management's
preliminary fair value allocation which may be subject to further update.
(v) The main asset of Zhongtian Synergetic Energy was under construction during the period ended 30 June 2017.
13 FIXED ASSETS
The Group
Oil Equipment,
Plants and and gas machinery
buildings properties and others Total
RMB million RMB million RMB million RMB million
Cost:
Balance at 1 January 2017 114,920 650,685 892,936 1,658,541
Additions for the period 279 493 2,434 3,206
Transferred from construction in progress 1,088 6,857 12,241 20,186
Reclassifications 667 (159) (508) -
Decreases for the period (743) (116) (9,188) (10,047)
Exchange adjustments (57) (1,037) (87) (1,181)
Balance at 30 June 2017 116,154 656,723 897,828 1,670,705
Accumulated depreciation:
Balance at 1 January 2017 45,243 404,919 463,023 913,185
Additions for the period 1,984 26,422 22,965 51,371
Reclassifications 78 (84) 6 -
Decreases for the period (215) (104) (3,627) (3,946)
Exchange adjustments (24) (768) (41) (833)
Balance at 30 June 2017 47,066 430,385 482,326 959,777
Provision for impairment losses:
Balance at 1 January 2017 3,329 30,642 20,791 54,762
Additions for the period 47 3,487 427 3,961
Reclassifications 55 (40) (15) -
Decreases for the period (6) - (44) (50)
Exchange adjustments - (38) (1) (39)
Balance at 30 June 2017 3,425 34,051 21,158 58,634
Net book value:
Balance at 30 June 2017 65,663 192,287 394,344 652,294
Balance at 31 December 2016 66,348 215,124 409,122 690,594
(15)
-
Decreases for the period
(6)
-
(44)
(50)
Exchange adjustments
-
(38)
(1)
(39)
Balance at 30 June 2017
3,425
34,051
21,158
58,634
Net book value:
Balance at 30 June 2017
65,663
192,287
394,344
652,294
Balance at 31 December 2016
66,348
215,124
409,122
690,594
The Company
Oil Equipment,
Plants and and gas machinery
buildings properties and others Total
RMB million RMB million RMB million RMB million
Cost:
Balance at 1 January 2017 47,586 540,499 443,485 1,031,570
Additions for the period - 355 525 880
Transferred from construction in progress 380 5,325 5,325 11,030
Reclassifications 198 (157) (41) -
Transferred from subsidiaries 58 - 561 619
Decreases for the period (32) (116) (1,124) (1,272)
Balance at 30 June 2017 48,190 545,906 448,731 1,042,827
Accumulated depreciation:
Balance at 1 January 2017 21,401 337,394 255,451 614,246
Additions for the period 801 21,009 10,638 32,448
Reclassifications 46 (82) 36 -
Transferred from subsidiaries 31 - 493 524
Decreases for the period (19) (104) (866) (989)
Balance at 30 June 2017 22,260 358,217 265,752 646,229
Provision for impairment losses:
Balance at 1 January 2017 1,623 26,727 15,954 44,304
Additions for the period 28 3,522 227 3,777
Reclassifications 39 (40) 1 -
Transferred from subsidiaries 16 - 19 35
Decreases for the period - - (10) (10)
Balance at 30 June 2017 1,706 30,209 16,191 48,106
Net book value:
Balance at 30 June 2017 24,224 157,480 166,788 348,492
Balance at 31 December 2016 24,562 176,378 172,080 373,020
1
-
Transferred from subsidiaries
16
-
19
35
Decreases for the period
-
-
(10)
(10)
Balance at 30 June 2017
1,706
30,209
16,191
48,106
Net book value:
Balance at 30 June 2017
24,224
157,480
166,788
348,492
Balance at 31 December 2016
24,562
176,378
172,080
373,020
13 FIXED ASSETS (Continued)
The additions to oil and gas properties of the Group and the Company for six-month period ended 30 June 2017 included RMB
493 million (2016: RMB 1,700 million) (Note 31) and RMB 355 million (2016: RMB1,690 million), respectively of the estimated
dismantlement costs for site restoration.
Impairment losses on fix assets for the six-month period ended 30 June 2017 primarily represent impairment losses of RMB
3,487 million (2016: nil) for the exploration and production ("E&P") segment, RMB 309 million (2016: RMB 118 million) for
the chemicals segment, and RMB 165 million (2016: RMB 1,108 million) for the refining segment. The primary factors
resulting in the E&P segment impairment loss were high operating cost for certain oil fields. The carrying values of these
E&P properties were written down to recoverable amounts which were determined based on the present values of the expected
future cash flows of the assets using a pre-tax discount rate 10.47% (2016: 10.80%). Further future downward revisions to
the Group's oil price outlook by 5% or more would lead to further impairments which, in aggregate, are likely to be
material. It is estimated that a general decrease of 5% in oil price, with all other variables held constant, would result
in additional impairment loss in E&P segment by approximately RMB 2,401 million. It is estimated that a general increase of
5% in operating cost, with all other variables held constant, would result in additional impairment loss in E&P segment by
approximately RMB 1,879 million. It is estimated that a general increase of 5% in discount rate, with all other variables
held constant, would result in additional impairment loss in E&P segment by approximately RMB 809 million. The assets in
the chemicals segment and refining segment were written down mainly due to the suspension of operations of certain
production facilities.
At 30 June 2017 and 31 December 2016, the Group and the Company had no individually significant fixed assets which were
pledged.
At 30 June 2017 and 31 December 2016, the Group and the Company had no individually significant fixed assets which were
temporarily idle or pending for disposal.
At 30 June 2017 and 31 December 2016, the Group and the Company had no individually significant fully depreciated fixed
assets which were still in use.
14 CONSTRUCTION IN PROGRESS
The Group The Company
RMB million RMB million
Cost:
Balance at 1 January 2017 131,274 49,689
Additions for the period 16,373 11,555
Disposals for the period (3) -
Transferred to subsidiaries - -
Dry hole costs written off (3,937) (3,543)
Transferred to fixed assets (20,186) (11,030)
Reclassification to other assets (2,261) (89)
Exchange adjustments (43) -
Balance at 30 June 2017 121,217 46,582
Provision for impairment losses:
Balance at 1 January 2017 1,693 412
Additions for the period - -
Decreases for the period (24) -
Balance at 30 June 2017 1,669 412
Net book value:
Balance at 30 June 2017 119,548 46,170
Balance at 31 December 2016 129,581 49,277
-
Balance at 30 June 2017
1,669
412
Net book value:
Balance at 30 June 2017
119,548
46,170
Balance at 31 December 2016
129,581
49,277
At 30 June 2017, major construction projects of the Group are as follows:
Accumulated
Project name Budgetedamount Balance at1 January2017 Net changefor theperiod Balance at30 June2017 Percentage ofCompletion Source of funding interestcapitalisedat 30 June2017
RMB million RMB million RMB million RMB million % RMB million
Zhongke Refine Integration Project 34,667 3,274 1,361 4,635 13% Self-financing -
Guangxi LNG Project 15,475 4,903 285 5,188 63% Bank loans & self-financing 666
Tianjin LNG Project 13,639 8,213 (798) 7,415 65% Bank loans & self-financing 142
Zhenhai Old Areas Structure 3,709 264 46 310 8% Self-financing -
Transformation Project
Zhejiang Yong-Tai-Wen Refined Oil Pipeline 1,804 1,244 103 1,347 75% Bank loans & self-financing 35
Construction Project
264
46
310
8%
Self-financing
-
Zhejiang Yong-Tai-Wen Refined Oil Pipeline
Construction Project
1,804
1,244
103
1,347
75%
Bank loans & self-financing
35
15 INTANGIBLE ASSETS
The Group
Land use Non-patent Operation
rights Patents technology rights Others Total
RMB million RMB million RMB million RMB million RMB million RMB million
Cost:
Balance at 1 January 2017 68,467 4,378 4,134 36,908 4,013 117,900
Additions for the period 2,956 28 18 9,016 592 12,610
Decreases for the period (2,488) - (634) (1) (87) (3,210)
Balance at 30 June 2017 68,935 4,406 3,518 45,923 4,518 127,300
Accumulated amortisation:
Balance at 1 January 2017 14,015 3,261 2,259 9,892 2,596 32,023
Additions for the period 1,416 108 125 3,043 194 4,886
Decreases for the period (690) - (10) (1) (10) (711)
Balance at 30 June 2017 14,741 3,369 2,374 12,934 2,780 36,198
Provision for impairment losses:
Balance at 1 January 2017 211 483 24 120 16 854
Additions for the period 8 1 - 14 1 24
Decreases for the period (6) - - - - (6)
Balance at 30 June 2017 213 484 24 134 17 872
Net book value:
Balance at 30 June 2017 53,981 553 1,120 32,855 1,721 90,230
Balance at 31 December 2016 54,241 634 1,851 26,896 1,401 85,023
-
(6)
Balance at 30 June 2017
213
484
24
134
17
872
Net book value:
Balance at 30 June 2017
53,981
553
1,120
32,855
1,721
90,230
Balance at 31 December 2016
54,241
634
1,851
26,896
1,401
85,023
Amortisation of the intangible assets of the Group charged for the six-month period ended 30 June 2017 is RMB 2,173 million
(2016: RMB 3,112 million).
16 GOODWILL
Goodwill is allocated to the following Group's cash-generating units:
Name of investees Principal activities At 30 June At 31 December
2017 2016
RMB million RMB million
Sinopec Beijing Yanshan Petrochemical Branch ("Sinopec Yanshan") Manufacturing of intermediate petrochemical products and petroleum products 1,157 1,157
Sinopec Zhenhai Refining and Chemical Branch ("Sinopec Zhenhai") Manufacturing of intermediate petrochemical products and petroleum products 4,043 4,043
Sinopec (Hong Kong) Limited Trading of petrochemical products 913 941
Other units without individual significant goodwill 212 212
Total 6,325 6,353
212
212
Total
6,325
6,353
Goodwill represents the excess of the cost of purchase over the fair value of the underlying assets and liabilities. The
recoverable amounts of the above cash generating units are determined based on value in use calculations. These
calculations use cash flow projections based on financial budgets approved by management covering a one-year period and
pre-tax discount rates primarily ranging from 10.7% to 11.3% (2016: 10.4% to 11.0%). Cash flows beyond the one-year period
are maintained constant. Based on the estimated recoverable amount, no impairment loss was recognised.
Key assumptions used for cash flow forecasts for these entities are the gross margin and sales volume. Management
determined the budgeted gross margin based on the gross margin achieved in the period immediately before the budget period
and management's expectation on the future trend of the prices of crude oil and petrochemical products. The sales volume
was based on the production capacity and/or the sales volume in the period immediately before the budget period.
17 LONG-TERM DEFERRED EXPENSES
Long-term deferred expenses primarily represent prepaid rental expenses over one year and catalysts expenditures.
18 DEFERRED TAX ASSETS AND LIABILITIES
Deferred tax assets and liabilities before the consolidated elimination adjustments are as follows:
Deferred tax assets Deferred tax liabilities Net balance
At 30 June At 31 December At 30 June At 31 December At 30 June At 31 December
2017 2016 2017 2016 2017 2016
RMB million RMB million RMB million RMB million RMB million RMB million
Current
Receivables and inventories 1,449 347 - - 1,449 347
Accruals 655 391 - - 655 391
Cash flow hedges 18 27 (299) (242) (281) (215)
Non-current
Fixed assets 11,397 11,264 (11,993) (14,615) (596) (3,351)
Tax value of losses carried forward 2,151 2,477 - - 2,151 2,477
Others 427 133 (190) (229) 237 (96)
Deferred tax assets/(liabilities) 16,097 14,639 (12,482) (15,086) 3,615 (447)
-
2,151
2,477
Others
427
133
(190)
(229)
237
(96)
Deferred tax assets/(liabilities)
16,097
14,639
(12,482)
(15,086)
3,615
(447)
The consolidated elimination amount between deferred tax assets and liabilities are as follows:
At 30 June At 31 December
2017 2016
RMB million RMB million
Deferred tax assets 6,336 7,425
Deferred tax liabilities 6,336 7,425
6,336
7,425
Deferred tax assets and liabilities after the consolidated elimination adjustments are as follows:
At 30 June At 31 December
2017 2016
RMB million RMB million
Deferred tax assets 9,761 7,214
Deferred tax liabilities 6,146 7,661
6,146
7,661
At 30 June 2017, certain subsidiaries of the Company did not recognise deferred tax of deductible loss carried forward of
RMB 18,513 million (At 31 December 2016: RMB 19,194 million), of which RMB 1,637 million (2016: RMB 2,000 million) was
incurred for the six-month period ended 30 June 2017, because it was not probable that the related tax benefit will be
realised. These deductible losses carried forward of RMB 2,441 million, RMB 2,565 million, RMB 3,957 million, RMB 4,080
million, RMB 3,833 million and RMB 1,637 million will expire in 2017, 2018, 2019, 2020, 2021,2022 and after, respectively.
Periodically, management performed assessment on the probability that future taxable profit will be available over the
period which the deferred tax assets can be realised or utilised. In assessing the probability, both positive and negative
evidence was considered, including whether it is probable that the operations will have sufficient future taxable profits
over the periods which the deferred tax assets are deductible or utilised and whether the tax losses result from
identifiable causes which are unlikely to recur. During the six-month period ended 30 June 2017, write-down of deferred tax
assets amounted to RMB 9 million (2016: RMB 43 million) (Note 49).
19 OTHER NON-CURRENT ASSETS
Other non-current assets mainly represent prepayments for construction projects and purchases of equipment.
20 DETAILS OF IMPAIRMENT LOSSES
At 30 June 2017, impairment losses of the Group are analysed as follows:
Balance at Provision Written back Written off Other Balance at
Note 1 January 2017 for theperiod for theperiod forthe period (decrease)/increase 30 June2017
RMB million RMB million RMB million RMB million RMB million RMB million
Allowance for doubtful accounts
Included: Accounts receivable 7 683 39 (121) (1) (2) 598
Other receivables 8 1,349 18 (32) (6) (1) 1,328
Prepayments 9 31 7 - - - 38
2,063 64 (153) (7) (3) 1,964
Inventories 10 920 204 (1) (51) (9) 1,063
Long-term equity investments 12 722 - - - (8) 714
Fixed assets 13 54,762 3,961 - (28) (61) 58,634
Construction in progress 14 1,693 - - - (24) 1,669
Intangible assets 15 854 1 - - 17 872
Goodwill 16 7,663 - - - - 7,663
Others 43 - - - (10) 33
Total 68,720 4,230 (154) (86) (98) 72,612
15
854
1
-
-
17
872
Goodwill
16
7,663
-
-
-
-
7,663
Others
43
-
-
-
(10)
33
Total
68,720
4,230
(154)
(86)
(98)
72,612
The reasons for recognising impairment losses are set out in the respective notes of respective assets.
21 SHORT-TERM LOANS
The Group's short-term loans represent:
At 30 June 2017 At 31 December 2016
Original Original
currency Exchange RMB currency Exchange RMB
million rates million million rates million
Short-term bank loans 19,063 11,944
- Renminbi loans 17,460 10,931
- US Dollar loans 237 6.7744 1,603 146 6.9370 1,013
Short-term loans from Sinopec Group 22,969 18,430
Company and fellow subsidiaries
- Renminbi loans 983 2,858
- US Dollar loans 2,984 6.7744 20,213 1,957 6.9370 13,577
- HK Dollar loans 2,004 0.8679 1,739 2,202 0.8945 1,969
- Euro loans 1 7.7496 5 1 7.3068 5
- Singapore Dollar loans 6 4.9135 29 4 4.7995 21
Total 42,032 30,374
5
1
7.3068
5
- Singapore Dollar loans
6
4.9135
29
4
4.7995
21
Total
42,032
30,374
At 30 June 2017, the Group's interest rates on short-term loans were from interest 0.68% to 6.19% (At 31December 2016: from
interest 0.68% to 6.19%). The majority of the above loans are by credit.
At 30 June 2017 and 31 December 2016, the Group had no significant overdue short-term loan.
22 BILLS PAYABLE
Bills payable primarily represented bank accepted bills for the purchase of material, goods and products. Bills payable
were due within one year.
At 30 June 2017 and 31 December 2016, the Group had no overdue unpaid bills.
23 ACCOUNTS PAYABLE
At 30 June 2017 and 31 December 2016, the Group had no individually significant accounts payable aged over one year.
24 ADVANCES FROM CUSTOMERS
At 30 June 2017 and 31 December 2016, the Group had no individually significant advances from customers aged over one
year.
25 EMPLOYEE BENEFITS PAYABLE
At 30 June 2017 and 31 December 2016, the Group's employee benefits payable primarily represented wages payable and social
insurance payables.
26 TAXES PAYABLE
The Group
At 30 June At 31 December
2017 2016
RMB million RMB million
Value-added tax payable 5,106 8,668
Consumption tax 15,509 29,682
Income tax 5,192 6,051
Mineral resources compensation fee 176 196
Other taxes 5,874 8,289
Total 31,857 52,886
Other taxes
5,874
8,289
Total
31,857
52,886
27 OTHER PAYABLES
At 30 June 2017 and 31 December 2016, the Group's other payables primarily represented payables for constructions.
At 30 June 2017 and 31 December 2016, the Group had no individually significant other payables aged over three years.
28 NON-CURRENT LIABILITIES DUE WITHIN ONE YEAR
The Group's non-current liabilities due within one year represent:
At 30 June 2017 At 31 December 2016
Original Original
currency Exchange RMB currency Exchange RMB
million rates million million rates million
Long-term bank loans
- Renminbi loans 6,553 8,753
- US Dollar loans 4 6.7744 24 6 6.9370 42
6,577 8,795
Long-term loans from Sinopec Group
Company and fellow subsidiaries
- Renminbi loans - 150
- 150
Long-term loans due within one year 6,577 8,945
Debentures payable due within one year 18,266 29,500
Others 663 527
Non-current liabilities due within one year 25,506 38,972
663
527
Non-current liabilities due within one year
25,506
38,972
At 30 June 2017 and 31 December 2016, the Group had no significant overdue long-term loans.
29 LONG-TERM LOANS
The Group's long-term loans represent:
At 30 June 2017 At 31 December 2016
Interest rate and final maturity Originalcurrencymillion Exchangerates RMBmillion Originalcurrencymillion Exchangerates RMBmillion
Long-term bank loans
- Renminbi loans Interest rates ranging from interest 1.08% to 4.41% per annum at 30 June 2017 with maturities through 2030 29,404 26,058
- US Dollar loans Interest rates ranging from interest 1.55 % to 4.29 % per annum at 30 June 2017 with maturities through 2031 57 6.7744 386 61 6.9370 426
Less: Current portion (6,577) (8,795)
Long-term bank loans 23,213 17,689
Long-term loans from Sinopec Group Company and fellow subsidiaries
- Renminbi loans Interest rates ranging from interest free to 3.92 % per annum 44,832 44,922
at 30 June 2017 with maturities through 2021
Less: Current portion - (150)
Long-term loans from Sinopec Group Company and fellow subsidiaries 44,832 44,772
Total 68,045 62,461
Total
68,045
62,461
The maturity analysis of the Group's long-term loans is as follows:
At 30 June At 31 December
2017 2016
RMB million RMB million
Between one and two years 3,349 3,957
Between two and five years 57,816 56,725
After five years 6,880 1,779
Total 68,045 62,461
1,779
Total
68,045
62,461
Long-term loans are primarily unsecured, and carried at amortised costs.
30 DEBENTURES PAYABLE
The Group
At 30 June At 31 December
2017 2016
RMB million RMB million
Short-term corporate bonds (i) - 6,000
Debentures payable:
- Corporate Bonds (ii) 66,050 84,485
Less: Current portion (18,266) (29,500)
Total 47,784 54,985
(29,500)
Total
47,784
54,985
Note:
(i) The company issued 182-day corporate bonds of face value RMB 6 billion to corporate investors in the PRC debenture
market on 12 September 2016 at par value of RMB 100. The effective cost of the 182-day corporate bonds is 2.54% per annum.
The short-term bonds were due on 14 March 2017 and have been fully paid by the Group at maturity.
(ii) These corporate bonds are carried at amortised cost, including USD denominated corporate bonds of RMB 18,550 million,
and RMB denominated corporate bonds of RMB 47,500 million (31 December 2016: USD denominated corporate bonds of RMB 18,985
million, and RMB denominated corporate bonds of RMB 65,500 million). At 30 June 2017, corporate bonds of RMB 18,550 million
(2016: RMB 18,985 million) are guaranteed by Sinopec Group Company.
31 PROVISIONS
Provisions primarily represent provision for future dismantlement costs of oil and gas properties. The Group has
established certain standardised measures for the dismantlement of its retired oil and gas properties by making reference
to the industry practices and is thereafter constructively obligated to take dismantlement measures of its retired oil and
gas properties. Movement of provision of the Group's obligations for the dismantlement of its retired oil and gas
properties is as follows:
The Group
RMB million
Balance at 1 January 2017 36,918
Provision for the period 493
Accretion expenses 659
Utilised for the period (75)
Exchange adjustments (66)
Balance at 30 June 2017 37,929
Exchange adjustments
(66)
Balance at 30 June 2017
37,929
32 OTHER NON-CURRENT LIABILITIES
Other non-current liabilities primarily represent long-term payables, special payables and deferred income.
33 SHARE CAPITAL
The Group
At 30 June At 31 December
2017 2016
RMB million RMB million
Registered, issued and fully paid:
95,557,771,046 domestic listed A shares (2016: 95,557,771,046) of RMB 1.00 each 95,558 95,558
25,513,438,600 overseas listed H shares (2016: 25,513,438,600) of RMB 1.00 each 25,513 25,513
Total 121,071 121,071
Total
121,071
121,071
The Company was established on 25 February 2000 with a registered capital of 68.8 billion domestic state-owned shares with
a par value of RMB 1.00 each. Such shares were issued to Sinopec Group Company in consideration for the assets and
liabilities transferred to the Company (Note 1).
Pursuant to the resolutions passed at an Extraordinary General Meeting held on 25 July 2000 and approvals from relevant
government authorities, the Company is authorised to increase its share capital to a maximum of 88.3 billion shares with a
par value of RMB 1.00 each and offer not more than 19.5 billion shares with a par value of RMB 1.00 each to investors
outside the PRC. Sinopec Group Company is authorised to offer not more than 3.5 billion shares of its shareholdings in the
Company to investors outside the PRC. The shares sold by Sinopec Group Company to investors outside the PRC would be
converted into H shares.
In October 2000, the Company issued 15,102,439,000 H shares with a par value of RMB 1.00 each, representing 12,521,864,000
H shares and 25,805,750 American Depositary Shares ("ADSs", each representing 100 H shares), at prices of HKD 1.59 per H
share and USD 20.645 per ADS, respectively, by way of a global initial public offering to Hong Kong and overseas investors.
As part of the global initial public offering, 1,678,049,000 state-owned ordinary shares of RMB 1.00 each owned by Sinopec
Group Company were converted into H shares and sold to Hong Kong and overseas investors.
In July 2001, the Company issued 2.8 billion listed A shares with a par value of RMB 1.00 each at RMB 4.22 by way of a
public offering to natural persons and institutional investors in the PRC.
During the year ended 31 December 2010, the Company issued 88,774 listed A shares with a par value of RMB 1.00 each, as a
result of exercise of 188,292 warrants entitled to the Bonds with Warrants.
During the year ended 31 December 2011, the Company issued 34,662 listed A shares with a par value of RMB 1.00 each, as a
result of conversion by the holders of the 2011 Convertible Bonds.
During the year ended 31 December 2012, the Company issued 117,724,450 listed A shares with a par value of RMB 1.00 each,
as a result of conversion by the holders of the 2011 Convertible Bonds.
33 SHARE CAPITAL (Continued)
The Group (Continued)
On 14 February 2013, the Company issued 2,845,234,000 listed H shares ("the Placing") with a par value of RMB 1.00 each at
the Placing Price of HKD 8.45 per share. The aggregate gross proceeds from the Placing amounted to approximately HKD
24,042,227,300.00 and the aggregate net proceeds (after deduction of the commissions and estimated expenses) amounted to
approximately HKD 23,970,100,618.00.
In June 2013, the Company issued 21,011,962,225 listed A shares and 5,887,716,600 listed H shares as a result of bonus
issues of 2 shares converted from the retained earnings, and 1 share transferred from capital reserve for every 10 existing
shares.
During the year ended 31 December 2013, the Company issued 114,076 listed A shares with a par value of RMB 1.00 each, as a
result of exercise of conversion by the holders of the 2011 Convertible Bonds.
During the year ended 31 December 2014, the Company issued 1,715,081,853 listed A shares with a par value of RMB 1.00 each,
as a result of exercise of conversion by the holders of the 2011 Convertible Bonds.
During the year ended 31 December 2015, the Company issued 2,790,814,006 listed A shares with a par value of RMB 1.00 each,
as a result of conversion by the holders of the 2011 Convertible Bonds.
All A shares and H shares rank pari passu in all material aspects.
Capital management
Management optimises the structure of the Group's capital, which comprises of equity and debts and bonds. In order to
maintain or adjust the capital structure of the Group, management may cause the Group to issue new shares, adjust the
capital expenditure plan, sell assets to reduce debt, or adjust the proportion of short-term and long-term loans and bonds.
Management monitors capital on the basis of the debt-to-capital ratio, which is calculated by dividing long-term loans
(excluding current portion) and debentures payable by the total of equity attributable to owners of the Company and
long-term loans (excluding current portion) and debentures payable, and liability-to-asset ratio, which is calculated by
dividing total liabilities by total assets. Management's strategy is to make appropriate adjustments according to the
Group's operating and investment needs and the changes of market conditions, and to maintain the debt-to-capital ratio and
the liability-to-asset ratio of the Group at a range considered reasonable. As at 30 June 2017, the debt-to-capital ratio
and the liability-to-asset ratio of the Group were 13.9 % (2016: 14.2%) and 43.1 % (2016: 44.5%), respectively.
The schedule of the contractual maturities of loans and commitments are disclosed in Notes 29 and 55, respectively.
There were no changes in the management's approach to capital management of the Group during the period. Neither the
Company nor any of its subsidiaries is subject to externally imposed capital requirements.
34 CAPITAL RESERVE
The movements in capital reserve of the Group are as follows:
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