Sinopec Engineering Group Co Ltd. — Capital/Financing Update 2021

Oct 12, 2021

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

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中石化煉化工程( 集團) 股份有限公司 SINOPEC Engineering (Group) Co., Ltd.*

(a joint stock limited liability company incorporated in the People’s Republic of China)

(Stock Code: 2386)

VOLUNTARY ANNOUNCEMENT TOTAL NEW CONTRACT VALUE AND BACKLOG

This announcement is made voluntarily by SINOPEC Engineering (Group) Co., Ltd. (the “ Company ”, together with its subsidiaries, the “ Group ”). The board of directors of the Company (the “ Board ”) is pleased to update shareholders of the Company and potential investors on certain information in connection with the representative new contracts entered into by the Group for the three months ended 30 September 2021, the total value of the new contracts for the nine months ended 30 September 2021 and the backlog as at 30 September 2021.

This announcement is made by the order of the Board. The Board collectively and individually accepts responsibility for the accuracy of this announcement.

Shareholders of the Company and potential investors are advised to exercise caution when dealing in the shares of the Company.

During the nine months ended 30 September 2021, the total value of new contracts entered into by the Group amounted to RMB49.081 billion, representing an increase of 1.9% as compared to RMB48.179 billion for the nine months ended 30 September 2020. As at 30 September 2021, the backlog of the Group amounted to RMB114.364 billion, representing an increase of 8.2% as compared to RMB105.655 billion as at 31 December 2020.

• For identification purposes only.

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New Contract Value and Backlog

Representative New Contracts

New contract value represents the value of the contracts the Group entered into during a specified period. The value of a contract is the amount that the Group expects to receive under the terms of the contract if the contract is performed in accordance with its terms. During the three months ended 30 September 2021, the total value of new contracts entered into by the Group amounted to RMB12.418 billion, and representative new contracts are as follows:

1. an engineering procurement and construction (EPC) contract entered into with Sinopec Qingdao LNG Company (中國石化青島液化天然氣有限公司) in relation to Shandong liquified natural gas (LNG) project Phase III receiving terminal with a total contract value of approximately RMB981 million;

2. a construction contract entered into with Sinopec Baling Petrochemical Company ( 中國石化巴陵石油化工有限公司 ) in relation to Baling Petrochemical’s caprolactam industrial chain relocation and upgrading project with a total contract value of approximately RMB605 million; and

3. a construction contract with Zhejiang Petroleum & Chemical Co., Ltd. (浙江石 油化工有限公司) in relation to the ABS facilities of the 40 million tons/year refining and chemical integration project (Phase II) with a total contract value of approximately RMB483 million.

Backlog

Backlog represents the total estimated contract value of work that remains to be completed pursuant to outstanding contracts as at a certain date, net of estimated value added tax, and is based on the Group’s assumption that the relevant contracts will be performed in accordance with their terms. Backlog is not a measure defined by generally accepted accounting principles. Any modification, termination or suspension of these contracts by the Group’s clients may have a substantial and immediate effect on the Group’s backlog. Projects may also remain in the Group’s backlog for an extended period of time beyond what was initially anticipated due to various factors beyond the Group’s control.

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The table below sets out the details of the total value of new contracts entered into by the Group and its backlog categorised by (1) business segments; (2) the industries in which the Group’s clients operate; (3) regions; and (4) clients of each of (i) China Petrochemical Corporation (“ Sinopec Group ”) and its associates and (ii) the nonSinopec Group and its associates during the period or as at the date indicated:

	Total	of New
	Contract Value				Backlog
	For the nine months				As at
	ended 30 September		2021		30 September		2021
	(RMB	Percentage			(RMB	Percentage
	thousand)		(%)		thousand)		(%)
Business segments
Engineering, Consulting and
Licensing	4,648,742		9.5		11,003,481		9.6
EPC Contracting	20,671,320		42.1		71,829,665		62.8
Construction	22,954,841		46.8		30,504,352		26.7
Equipment Manufacturing	805,801		1.6		1,026,087		0.9
Total	49,080,704	100.0		114,363,585			100.0
Industries in which the Group’s
clients operate
Oil Refining	9,271,674		18.9		31,154,719		27.2
Petrochemicals	26,295,780		53.6		32,203,515		28.2
New Coal Chemicals	809,222		1.6		11,611,522		10.2
Storage & Transportation and
Others	12,704,028		25.9		39,393,829		34.4
Total	49,080,704	100.0		114,363,585			100.0
Regions
PRC	42,456,986		86.5		85,186,003		74.5
Overseas	6,623,718		13.5		29,177,582		25.5
Total	49,080,704	100.0		114,363,585			100.0
Clients of each of (i) Sinopec
Group and its associates and
(ii) the non-Sinopec Group
and its associates
Sinopec Group and its associates	29,972,949		61.1		62,237,523		54.4
Non-Sinopec Group and its
associates	19,107,755		38.9		52,126,062		45.6
Total	49,080,704	100.0		114,363,585			100.0

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The Board wishes to emphasise that the above information in relation to the representative new contracts, the total value of new contracts and backlog shall not constitute any forecast or prediction of the profits of the Group.

This announcement is made by the order of the Board. The Board collectively and individually accepts responsibility for the accuracy of this announcement.

Shareholders of the Company and potential investors are advised to exercise caution when dealing in the shares of the Company.

By order of the Board SINOPEC ENGINEERING (GROUP) CO., LTD. Jia Yiqun

Chief Financial Officer, Company Secretary

Beijing, the PRC 12 October 2021

As at the date of this announcement, Directors of the company are: SUN Lili[#] , XIANG Wenwu[#] , WU Wenxin[*] , JIANG Dejun[#] , HUI Chiu Chung, Stephen[+] , JIN Yong[+] and YE Zheng[+] .

# Executive Directors

* Non-executive Director

+ Independent non-executive Directors

This announcement is available on the website of Hong Kong Exchanges and Clearing Limited (www.hkex.com.hk) and on the website of the Company (www.segroup.cn).

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