Shanghai Petrochemical Announces 2003 Annual Results Profit Attributable to Shareholders Increases by 52.97% to RMB1,401.7 million HONG KONG, March 28 /PRNewswire-FirstCall/ -- Sinopec Shanghai Petrochemical Company Limited (NYSE: SHI; HKEx:338; SSE: 600688) announced today the annual results for the year ended December 31, 2003 (the "Year") of the Company and its subsidiaries ("Shanghai Petrochemical" or the "Company"). Net sales for the Year increased by 33.24% to RMB28,942.7 million as comparedto 2002. Profit before tax was RMB1,590.4 million, representing an increase of 52.18% as compared to 2002. Profit attributable to shareholders was RMB1,401.7 million, representing an increase of 52.97% as compared to 2002. Earnings per share was RMB0.195 (2002: RMB0.127). The Board of Directors has recommended a dividend of RMB0.08 per share for the Year, equivalent to RMB8.00 per American Depositary Share. Mr. Lu Yiping, Chairman of Shanghai Petrochemical, said, "The Company has achieved satisfactory operating results in 2003, another year with steady growth after 2002. The global petrochemical industry picked up gradually in 2003 amid global economic recovery and continuous strong economic growth in China. The domestic petrochemical market saw positive developments as a result of increasing demand and continuing recovery of price in respect of our products, which effectively offset the negative effects caused by increases in the cost of crude oil. The recovery of market provided a good environment for the Company's production and operation." The Phase IV Project completed in steps in 2002 and commenced full production in 2003, which, together with improvements in production and operational management, has boosted the Company's production capacity and sales volume. Gasoline output increased by 0.89% to 894,800 tons, while diesel output increased by 11.45% to 2,487,600 tons during the Year, as compared to 2002. The output of ethylene and propylene increased by 18.53% and 24.44% to 948,300 tons and 533,100 tons, respectively, as compared to 2002. The output of synthetic fibre monomers and synthetic fibre polymers amounted to 421,300 tons and 507,600 tons, respectively, representing an increase of 10.71% and 7.02%, respectively, as compared to 2002. The output of synthetic fibres increased by 5.24% to 315,500 tons, while the output of synthetic resins increased by 34.72% to 900,500 tons as compared to 2002. The Company remained the largest ethylene producer in China, and exceeded the annual production targets set in respect of all of its major products. During the Year, sales volume in each of the Company's four major product category, namely synthetic fibers, resins and plastics, intermediate petrochemicals and petroleum products, increased by 8.8%, 21.2%, 30.0% and 13.4%, respectively, as compared to 2002. The weighted average price for each of those categories increased by 11.5%, 13.6%, 16.0% and 14.0%, respectively, as compared to 2002. This led to an increase in the Company's total net sales by 33.2% to RMB28,942.7 million in 2003 as compared to 2002. Crude oil processing volume increased by 15.9% to 8.61 million tons in 2003. Due to the shortage of supply in domestic onshore crude oil, the Company continued to increase the usage of imported crude oil to leverage the advantage of the Company's coastal location. In 2003, the Company processed 6.71 million tons of imported crude oil, 0.48 million tons of domestic offshore oil, 0.04 million tons of domestic onshore oil from Daqing oilfield and 1.38 million tons of domestic onshore oil from Shengli oilfield. In 2003, the Company's expansion and renovation projects progressed smoothly. The expansion of catalytic cracking propylene facility was successfully completed during the first half of the Year. The expansion of 130,000-ton/year acrylonitrile facility was completed and the facility commenced its operations in April 2003. The build-out of facility for selective hydro-desulphurisation of catalytic gasoline was completedand the facility commenced operation at the end of June 2003. The new 7,000-ton/year pentane plant built by the chemical research institute started operation at the end of October 2003 and the high-purity pentane it produced met the applicable quality standard. The upgrade of the 150,000-ton/year polyester facility commenced on June 10, 2003 and is scheduled to commence operation in June 2004 while installation of its major equipment is currently underway. Construction of the Company's ethylene joint venture with China Petroleum & Chemical Corporation and BP Chemicals East China Investments Limited is progressing smoothly and its equipment is being installed. The Company anticipates, in 2004, the global economic recovery gain a faster pace as compared to 2003. China's petrochemical industry will enjoy favourable market conditions given China's continuous rapid economic growth. The growth of China's domestic demand for petrochemical products is expected to remain relatively strong. Mr. Lu said, "The Company will respond proactively to the profound changes in the macro-economic environment by capitalising on the current historical opportunities and favourable market conditions. The Company plans to continue to optimize the management of its production system and ensure a steady growth of product output. The Company will continue to expand its market share in both domestic and international markets, striving to deliver ever stronger results in 2004." Shanghai Petrochemical is one of the largest petrochemical companies in the PRC and was one of the first Chinese companies making 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 fibers, resins and plastics, intermediate petrochemicals and petroleum categories. For further information, please contact: Christy Lai / Jessica Chau Rikes Communications Limited Tel: (852) 2520 2201 Fax: (852) 2520 2241 Sinopec Shanghai Petrochemical Company Limited 2003 Annual Results (Prepared under International Financial Reporting Standards) Summary of Consolidated Income Statement For the years ended 31 December 2003 2002 RMB'000 RMB'000 Turnover 29,567,140 22,322,896 Profit before tax 1,590,365 1,045,038 Income tax expense (145,065) (84,494) Profit after tax 1,445,300 960,544 Minority interests (43,610) (44,179) Profit attributable to shareholders 1,401,690 916,365 Basic earnings per share RMB0.195 RMB0.127 DATASOURCE: SinopecShanghai Petrochemical Company Limited CONTACT: Christy Lai or Jessica Chau, both of Rikes Communications Limited, +852-2520-2201, or fax, +852-2520-2241, for Sinopec Shanghai Petrochemical Company Limited

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