Shanghai Petrochemical Announces Results for the First Three Quarters of 2009

HONG KONG, Oct. 28 /PRNewswire-Asia/ -- Sinopec Shanghai Petrochemical Company Limited ("Shanghai Petrochemical" or the "Company") (HKEx: 338; SSE: 600688; NYSE: SHI) announced today the unaudited operating results of the Company and its subsidiaries (collectively, the "Group") for the nine-month period ended September 30, 2009 (the "Period").

Under the China Accounting Standards for Business Enterprises, the Group's operating income for the Period amounted to RMB34.264 billion, representing a decrease of 31% compared to the same period of last year, due to a significant decrease in product prices following a decrease in crude oil prices as compared to the same period of last year. Operating profit for the Period was RMB2.013 billion (same period of 2008: operating loss was RMB5.710 billion). Net profit attributable to equity shareholders of the Company for the Period was RMB1.538 billion (same period of 2008: net loss attributable to equity shareholders of the Company was RMB2.679 billion). Basic diluted earnings per share was RMB0.214 (same period of 2008: basic diluted losses per share was RMB0.372).

Mr. Rong Guangdao, Chairman of Shanghai Petrochemical, said, "Since the beginning of this year, China has implemented the Price and Tax Reform on Refined Oil by beginning to levy the fuel consumption tax and indirectly linking the prices of domestic refined oil products with the prices of international crude oil in a controlled manner, together with the promulgation of the "Administrative Measures for Petroleum Prices (Trial)" in May, the inversion between prices of refined oil products and those of crude oil was basically brought to an end, thus improving the profitability of the Company's refining operation to a certain extent. The petrochemical operation has bottomed out and re-stabilized, with prices of a majority of products having risen to a certain extent as demands in the downstream industry have gradually stabilized. Also, the production load of the relevant plants of the Company has increased and profitability has, therefore, been enhanced to a certain extent. However, as the impact of the international financial crisis continues to persist and there is a further upward trend of international crude oil prices, together with further intensified competition in the market due to newly added production capacity, many uncertainties still exist in the external operating environment of the Company. The Group will continue to actively respond to difficulties and challenges in its production and operation; strive to ensure a safe, stable and optimized operation; and further improve its work on crude oil purchasing and products sale, with a view to further improving the Company's operating efficiency."

Shanghai Petrochemical is one of the largest petrochemical companies in the PRC and was one of the first Chinese companies to effect a global securities offering. Located in Jinshan District in the southwest of Shanghai, it is a highly integrated petrochemical complex which processes crude oil into a broad range of products in synthetic fibres, resins and plastics, intermediate petrochemicals and refined oil products.

This press release contains statements of a forward-looking nature. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward- looking statements by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. The accuracy of these statements may be impacted by a number of business risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including risks related to: the risk that the PRC economy may not grow at the same rate in future periods as it has in the last several years, or at all, including as a result of the PRC government's macro-economic control measures to curb over-heating of the economy; uncertainty as to global economic growth in future periods; the risk that prices of the Company's raw materials, particularly crude oil, will continue to increase; the risk that the Company may not be able to raise its product prices (particularly refined oil products) accordingly which would adversely affect the Company's profitability; the risk that new marketing and sales strategies may not be effective; the risk that fluctuations in demand for the Company's products may cause the Company to either over-invest or under-invest in production capacity in one or more of its four major product categories; the risk that investments in new technologies and development cycles may not produce the benefits anticipated by management; the risk that the trading price of the Company's shares may decrease for a variety of reasons, some of which may be beyond the control of management; competition in the Company's existing and potential markets; and other risks outlined in the Company's filings with the U.S. Securities and Exchange Commission. The Company does not undertake any obligation to update this forward-looking information, except as required under applicable law.

Encl: Consolidated Income Statement (Unaudited) http://www.prnasia.com/sa/attachment/2009/10/20091028513932.pdf

    For further information, please contact:

     Ms. Janet Lai / Ms. Christy Lai
     Rikes Hill & Knowlton Limited
     Tel: +852-2520-2201
     Fax: +852-2520-2241

SOURCE Sinopec Shanghai Petrochemical Company Limited