The stock in Sinopec Shanghai Petrochemical Company Ltd. (HKEX: 0038; NYSE: SHI) was not largely impacted in early trading Thursday despite after the company announced plummeting net sales and profit for the full year 2019.
The Hong Kong-based crude oil processor said in a statement today that in the 12 months through December that its revenue was $14.17 million down 7% year-over-year. Profit slipped more than 50% to $314,793 compared with $754,235 in the full year 2018.
Sinopec attributed it struggles to Beijing’s’ tightening of rules on the safety of petrochemicals and low oil prices. That impacted the company’s operations and economic situation, as a result, net sales tanked to $12.45 million, representing a year-over-year decrease of 8%.
It’s also been a disaster for Sinopec’s stocks in both Hong Kong and New York, mostly on the fears of the coronavirus and weak oil prices. In New York, since it closed at $27.99 per share earlier this month, Sinopec has watched its stock fall to a 7 year low of $21.25 per share this week. Identically in Hong Kong, Sinopec dropped to another 7 year low at HK$1.65 per share.
While Sinopec will face big challenges in 2020, the company said it will launch a “14th Five-Year Plan" in efforts to promote a refining clean-up transformation.
"To realize the business targets in 2020, the Group will improve the level of safety and environmental protection, keep smooth operation of production devices, improve system optimization, tap the potential for cost reduction and efficiency improvement, accelerate the adjustment of industrial structure, make breakthroughs in core technologies, further strengthen corporate management and advance the reform of management system,” Wu Haijun, the chairman of Sinopec, said in a statement today.
In addition, Sinopec will build a R&D center to promote carbon fiber composite and industrial cultivation.