China Petroleum & Chemical Corporation announced its annual results for year ended December 31, 2009.
"The E&P business maintained crude output volume with reduced costs and expenses while the price of crude remained sluggish. It increased exploration input and reserve traps, and also invested resources in technological research and development for tertiary oil recovery from challenging reserves. As the international crude price gradually recovered, the E&P segment realized sound returns which enhanced the sustainability of its business. Fully leveraging its capability to accommodate various crude feeds, the refineries maximized refining throughput by running at almost full capacity ever since the second quarter of 2009. In the meantime, the refining segment introduced business process optimization initiatives across several functions, from crude procurement and resource allocation, to inventory and logistics management, and product mix adjustment, thus generating better profits. In the chemicals business, the Company made more efforts to expand the market, and enhanced the integration of R&D throughout the production plan. It also continued to improve customer service and strengthened strategic alliances with key customers. Despite the unfavorable market environment, the majority of chemical plants operated at full capacity since March 2009, delivering excellent performance. Capitalizing on the well-established marketing network, logistics systems and strong brand, the Company's marketing business successfully expanded its operational scale in an oversupplied domestic market by adopting innovative marketing approaches, flexible promotional programs and customer-oriented after-sales services. In addition, the non-fuel business grew significantly, driving up non-fuel business revenue and realized good operational results.
"Over the course of the past year, China's macro economy gradually recovered, and a fuel pricing policy paired with tax and fee reform were implemented in the domestic market. The Company's four business segments all achieved satisfactory operating performance, resulting from our effective counter-measures to the economic crisis, as well as from advantages gained from our integrated upstream, midstream and downstream business model. The Company's asset structure and quality have been enhanced, net assets increased by 14.6% compared to that at the end of 2008. In 2009, the Company was successful in fulfilling its role as a corporate citizen paying tax to government at central and local level with a total of RMB 179.05 billion."
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