DJ SEG Announced 2024 Annual Results Total Value of New Contracts Exceeded RMB 100 Billion With Record Dividend Payouts
EQS Newswire / 16/03/2025 / 20:10 UTC+8
Press Release
(For immediate release)
SEG Announced 2024 Annual Results
Total Value of New Contracts Exceeded RMB 100 Billion
With Record Dividend Payouts
(16 March 2025, Hong Kong) SINOPEC Engineering (Group) Co., Ltd. ("SEG" or the "Company", together with its subsidiaries collectively known as the "Group") (stock code: 2386) today announced its annual results for the twelve months ended 31 December 2024 (the "Reporting Period").
Over the past year, in the face of rapidly evolving industrial transformation, the complex and severe external situation and the fiercely competitive market environment, the Board and the management of the Company actively promoted market development, spared no effort in optimizing production and operation and accelerated the forging of new quality productive forces. We presented new vitality because of the high-quality development, delivering a satisfactory report to our shareholders: the Company achieved an annual operating revenue of RMB64.198 billion, a year-on-year increase of 13.9%; a net profit of RMB2.474 billion, a year-on-year increase of 5.5%; and a newly signed contract value of RMB100.613 billion, a year-on-year increase of 25.4%, the Company accomplished various production and operation tasks and QHSE targets. With an overall consideration of the profitability of the Company and the needs for sustainable development in the future, the Board proposed a final dividend of RMB0.208 per share, taking into account of the interim dividend already distributed, the total dividend for the full year was RMB0.358 per share with a dividend payout ratio of 65%, reaching a new high in the total annual dividend amount since the Company's listing.
The Group kept enhancing our value creation capability through engineering services, technological innovation, capital operations to seize the positions as a "Leader in the Engineering Industry" and a "Top Performer in the Capital Market".
Firstly, we aligned our efforts for high quality development and value creation of the Company. We paid great attention to the capital market's expectations for the Company's development and the concern for value enhancement. Through more transparent information disclosure and more proactive capital market communication, the high-quality development achievements have become more prominent. The Company attaches great importance to shareholder returns. The Company has maintained a dividend yield of 65% for four years in a row, achieved continuous growth in the amount of dividends paid out. The Company has actively safeguarded its value by conducting share repurchases for two consecutive years. The Company is committed to building itself into an enterprise with leading ESG performance. The MSCI ESG rating has been upgraded to BB level, making it the highest and the only company in the Chinese engineering industry to receive this rating. The recognition from the capital market continues increasing, and the goal of returning to "Southbound Trading" was successfully achieved. Secondly, we built its overall market competitiveness through comprehensive service capabilities. The Company made another historical breakthrough in market development. The total number of new orders maintained double-digit growth for three consecutive years and reached RMB100.613 billion, which signified our business successfully entering into the RMB100 billion club. New orders signed overseas made new highs in new markets, new varieties and new fields, and recorded USD5.349 billion, representing a significant year-on-year increase of 79.6%. The portfolio of our orders was further optimized. New orders signed in design consulting category exceeded RMB4.8 billion, representing a year-on-year increase of 16.1%. New orders signed in EPC category accounted for more than 70% of the total, laying a solid foundation for the Company to enhance its source competitiveness. Thirdly, we strengthened lean management to improve operational efficiency in all fronts. We strictly performed contracts and put greater emphasis on multi-objective comprehensive management and control of project quality, safety, progress and efficiency. The revenue scale from EPC and front-end business grew steadily and their weighting on out turnover continued to increase and stabilized overall project profitability amid the fierce market competition. Because of high standards, high quality and high efficiency of the construction and provision of a number of industry benchmark projects, we earned acclamation from the industry, including 9 provincial and ministerial quality awards, 9 provincial and ministerial design awards, and 9 first prizes of National Excellent Welding Projects. Fourthly, we continued promoting technological innovation to create high-quality technological supply. The amount of contracts related to technology development, technology licensing and technology transformation throughout the year reached RMB1.1 billion, representing a year-on-year growth of over 30%. Our ability to create profits in scientific research significantly improved. Relying on the gradual improvement of the technology matrix and synergetic efforts, we achieved major breakthroughs in exporting patented technologies such as polyolefins and aromatics, and entered the innovation and competition arena of core technologies in the global energy and chemical industry chain.
The Group takes the internationalization of corporate operations as the core development goal, promotes the internal capability building towards the high-end, and creates an integrated and co-produce industrial ecosystem with our industry chain partners. Firstly, we make every effort in constructing an overseas operation model of "international rules + Chinese efficiency". After more than 70 years of development and accumulation, the Company has nurtured a high-performance team with rich experience, complete professional skills and sufficient personnel, and has engineering service capabilities covering the whole industrial chain and life cycle of the energy and chemical industry. In the nearly three decades of internationalization efforts, the Company has learned from others with an open mind, while constantly adapting to "international rules", it has promoted the alignment of domestic and international standards, promoted the deep integration of "international rules" and "Chinese efficiency", and served global owners with high-quality engineering capabilities. Secondly, we will actively leverage on the two capabilities of "technology + engineering front-end" and "low-cost operation of projects". By relying on the advantages of integrated collaborative innovation in technology research and development, engineering transformation and engineering design, the Company will continue to build high-level front-end engineering capabilities and accelerated its expansion into the global high-end business track. We will optimize the whole process of design, procurement and construction, vigorously promote the application of advanced tooling, deepen the overseas localized operating capability system, promote the construction of low-cost centers at home and abroad and build up our competitive and low-cost execution capabilities. Thirdly, we will establish long-term cooperative partnership with strategic customers for win-win cooperation. By adopting the approaches of "going out" and "bringing in", communication will be enhanced and mutual trust will be deepened with strategic customers such as large national oil companies. While promoting the Group's advantages in industrial chain, technology chain and engineering services comprehensively, we will acquire first-mover advantages with more advanced and more diversified preliminary and front-end services. Fourthly, we will work with partners in the industrial chain to build an integrated and shared business environment. We will continue to expand the "firends cirlce", promote the comprehensive strategic partnership with international engineering companies, core suppliers and strategic sub-contractors, and strengthened in-depth cooperation in the areas of, among others, preliminary development of projects, optimizing the global supply chain and project implementation, so as to establish a global industrial chain system with international competitiveness.
The Group is driven by innovation to build the future competitiveness, actively promotes the deployment and application of artificial intelligence, and plays a leading role in the novel industrialization of the engineering and construction industry. Firstly, a new paradigm of deep integration of industry-university-research driven by enterprise needs will be promoted. By fully utilizing the advantages of integration and innovation of projects and engineering transformation, an "innovation chain" will be deployed around the "industry chain" to establish a planning and sourcing base of original technology. Through further coordinating with upstream research institutions and downstream users actively, technological innovation will continue to increase and open-up for cooperation. By jointly establishing the "Biomass Utilization Joint Research Center (High-value Utilization of Lignin)" with Guangdong University of Technology, the technological development of biomass utilization series and the industrial applications of research results are accelerated. The "Low-carbon Joint Research Center" is jointly established with Sun Yat-sen University, and deep cooperation is also carried out with research institutes such as Tsinghua University, Chinese Research Academy of Environmental Sciences, Shanghai Institute of Organic Chemistry, CAS, SINOPEC Beijing Research Institute of Chemical Industry and SINOPEC Research Institute of Petroleum Processing in multiple innovation fields. Secondly, we will focus on development needs of the industry and accurately allocated our R&D investments. We will increase investment in high-end carbon materials, conversion of low-cost oil, conversion of high-value oil to specialties, green and low-carbon, and new energy fields, promote the
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transformation and application of achievements, and promote the high-end and green development of the industry; we will accelerate the R&D layout in the fields of high-end materials such as low-altitude economy, robots and lightweight automobiles. Thirdly, we will actively promote the thematic study on "Leading the Novel Industrialization of the Engineering Construction Industry". Phased achievements have been made in the areas of standardized and refined design, integrated collaboration, factory-like intelligent manufacturing, information-based management, digital delivery, intelligent operation and maintenance, and robot substitution. We will organize practical competition in design optimization and studies on constructability, and establish specifications and systems for integration and collaboration of design and construction, with initial results achieved. The idea of "replacing manpower with machines" will be strongly promoted, R&D and applications of advanced tooling represented by welding robots and intelligent welding equipment will be carried out and strive to reduce costs and increase efficiency in realizing economies of scale. Fourthly, we will respond quickly to "Artificial Intelligence +" action and inject the gene of intelligence into the development of the industry. We will explore the in-depth application of "AI for Science, AI for Design, AI for Engineering, AI for Operation" and strive to promote the transformation of production methods. In the field of engineering research and development, we promote the all-round empowerment of artificial intelligence to technological transformation, optimization and upgrading, to build a new paradigm for scientific research and fully unleash the multiplier effect of digitalization and intelligence. In the field of engineering design, the Group carried out thematic research on intelligent design (AI), to promote the innovative application of artificial intelligence and big data technology in the field of engineering design, build a knowledge graph to improve design efficiency, and explore the transformation from traditional design to generative design. In the field of engineering construction, we tried to apply artificial intelligence to optimize the engineering construction scheme of the whole life cycle, shorten the iteration cycle of the scheme, optimize the construction scheduling arrangement, and improve the overall construction efficiency.
Mr. JIANG Dejun Chairman of SEG, said: "Looking forward to the future, both the "time" and "trend" of the external environment are undergoing profound changes. Global changes, industrial restructuring, and the scientific and technological revolution are surging, and are intertwined to create more complex and severe challenges. However, the opportunity of breaking the deadlock is precisely in challenging moments. Wherever the challenges lie, new opportunities are being bred. The transformation of China's energy and chemical industries is accelerating significantly, and the Company's service advantages in the whole industry chain and full life cycle are bound to brighten up. Although the global energy and chemical industry is highly competitive, long-term capital expenditure will provide the Company with incremental resources for its international operation. Artificial intelligence is catalyzing profound changes in all social and economic fields and links. The in-depth fusion of engineering research and development, engineering design, engineering construction and artificial intelligence will bring disruptive value opportunities. Standing at the intersection of the conclusion of the 14th Five-Year Plan and the beginning of the 15th Five-Year Plan, we will continue to adhere to the basic idea of high quality development in the aspects of "strengthening strategic leadership and coordination and integration, consolidating the advantages of traditional main businesses, driving technological innovations continuously, leading new-type industrialization of the engineering industry, promoting the internationalization of engineering enterprise's operation, and realizing the diversification of value creation of the listed company, to unswervingly move towards a world-class level. In the next step, we will go all out to coordinate the relationship between development and safety, adhere to the six bottom lines of "quality, safety, environmental protection, compliance, stability and integrity", embed risk management into every aspect of the Company's production and operation, and improve the risk prevention and control capabilities throughout the entire process through lean management. The Company will strive to make international operations as a new growth pole for the Company's high-quality development, further promote the dual-wheel driving efforts of "international rules + Chinese efficiency", further strengthen the two capabilities of "technology + engineering front-end" and "low-cost operation of projects", effectively prevent and control significant risks, and strive to achieve "bid-winner, excellent performance and efficacy" in overseas projects. The Company will accelerate the construction of a novel industrialization benchmark leading the way of industrial innovation. The engineering construction industry will be empowered through "integrated collaboration, technological innovation, digital and intelligent transformation, industrial intelligence, and green and low-carbon". Compared with other construction engineering companies, the Company has a unique talent advantage-reasonable structure and streamlined staff. We will actively embrace the AI revolution, seize historical opportunities, establish new processes for human-machine collaboration, cultivate "AI+" compatible talents, strive to achieve a breakthrough and double the per capita output value and marginal benefits, and promote the Company's production and operation to achieve leapfrog growth in quantity and efficiency. The initial heart is like a rock, and the journey is like a rainbow. We will further leverage on the Company's advantages in the integration of the whole industrial chain, market advantages, brand advantages, technology advantages and talent advantages to promote higher-quality development of the Company, unswervingly move towards a world-class level, and achieve the common improvement in shareholder value, customer value, social value and employee value!"
Business Review and Highlights
Maintaining a good momentum of QHSE performance
During the Reporting Period, the Group had 1,596 on-going domestic and overseas projects with over 100,000 on-site employees on average per day. As at the end of the Reporting Period, the cumulative safety labor hours were 380 million, and no safety, quality or environmental protection incidents were reported throughout the year.
During the Reporting Period, the Group continuously improved its project QHSE control standards and the management system operated effectively. The Group comprehensively promoted the construction of the "three basics" work safety standardization team, carried out training and certification on three types of management personnel including group leaders, team leaders and subcontractors, and completed the training covering all the strategic subcontractors. The Group promoted the application of the "Safety Pocket Book", established a comprehensive training and business competition mechanism for design, technology, quality and safety personnel, and the training performance of grassroots safety personnel and professional quality inspectors increased by 22% and 36%, respectively. The Group implemented the informatization management of "major hazardous projects", carried out inspection on design quality and physical quality, strengthened process assessment, and promoted the transformation of accident handling to prevention in advance. Focusing on the four major goals of carbon reduction, pollution reduction, efficiency improvement and green development, the second stage of green enterprise action was carried out, and the key laboratory for soil and groundwater pollution prevention and green remediation was established to comprehensively promote the treatment of VOCs and dust. The Group formulated green and ecological design guidelines, to strengthen the source management of energy and environment for construction projects and promote the intrinsic energy conservation and environmental protection of construction projects.
During the Reporting Period, ExxonMobil Huizhou Ethylene Project, a project designed and constructed by the Group, was awarded the "President's Award for Safety of Global Project" by the owner for the second time.
Quantitative and qualitative increase in market development
During the Reporting Period, the value of new contracts signed by the Group was RMB100.613 billion, breaking the threshold of RMB100 billion for the first time and hitting a new record high, representing a year-on-year increase of 25.4%. Among which, the value of newly signed domestic contracts was approximately RMB62.102 billion, representing a year-on-year increase of 5.6%; the value of newly signed overseas contracts was approximately USD5.349 billion, representing a year-on-year increase of
79.6%.
In the domestic market, the Group fully leveraged on its advantages in the entire industry chain to further grow in strategic emerging fields such as new technologies, new materials and new energy while consolidating its advantages in traditional businesses. During the Reporting Period, we signed the technology licensing contracts covering million-ton ethylene, million-ton aromatics, polypropylene and third-generation DMTO (DMTO-III); signed a batch of engineering design contracts for high-end new materials projects including CHN Energy Coal Chemicals, CNOOC Shell Huizhou Phase III Ethylene, CNOOC Shell Huizhou Polycarbonate and Yatong Chemical and Zhejiang Petrochemical; and signed a large batch of EPC contracts for areas such as refining and chemical integration, refining renovation and upgrading, new coal chemicals and new materials.
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