Sinopec Shanghai Petrochemical Company Limited (SPTJF) 6-K Current report (foreign)

Exhibit 99.3

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.

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

(Stock Code: 00338)

2022 Third Quarterly Report

This announcement is published simultaneously in Shanghai and Hong Kong. This announcement is published pursuant to the Rules Governing Listing of Stocks on Shanghai Stock Exchange in the People’s Republic of China and pursuant to the disclosure obligations under Rules 13.09 and 13.10B of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

1. Important Message

1.1 The Board of Directors (the “Board”) and the Supervisory Committee of Sinopec Shanghai Petrochemical Company Limited (the “Company” or “SPC”) as well as its directors, supervisors and senior management warrant the truthfulness, accuracy and completeness of the information contained in the 2022 third quarterly report for the nine months ended 30 September 2022, and warrant that there are no false representations or misleading statements contained in or material omissions from this report and severally and jointly accept responsibility pursuant to such information.

1.2 Mr. Wan Tao, Chairman of the Company, Mr. Du Jun, executive director, deputy president and CFO, overseeing the accounting operations, and Ms. Yang Yating, person-in-charge of Accounting Department (Accounting Chief) and Director of Finance Department warrant the truthfulness, accuracy and completeness of the financial report contained in this third quarterly report.

1.3 The financial report of the Company’s 2022 third quarterly report was prepared under the China Accounting Standards for Business Enterprises and was unaudited.

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2. Basic Information

2.1 Major Accounting Data

							Unit: RMB’000
	The Reporting Period*		Increase/decrease as compared to the corresponding period of the previous year (%)		From the beginning of the year to the end of the Reporting Period		Increase/decrease as compared to the corresponding period of the previous year (%)
Revenue		11,878,206		-51.96		57,778,561		-6.60
Net profit attributable to equity shareholders of the Company		-1,566,776		-317.35		-2,002,785		-201.92
Net profit attributable to equity shareholders of the Company excluding non-recurring items		-1,529,123		-313.63		-1,931,667		-202.46
Net cash flows generated from operating activities		1,670,792		-18.34		-4,734,330		Not Applicable
Basic earnings per share (RMB/share)		-0.145		Not Applicable		-0.185		Not Applicable
Diluted earnings per share (RMB/share)		-0.145		Not Applicable		-0.185		Not Applicable
Return on net assets (weighted average) (%)		-5.472		Decreased by 7.88 percentage points		-6.920		Decreased by 13.49 percentage points

	As at the end of the Reporting Period		As at the end of the previous year		Increase/decrease at the end of the Reporting Period as compared to the end of the previous year (%)
Total assets		44,689,289		47,038,622		-4.99
Total equity attributable to equity shareholders of the Company		27,259,789		30,260,172		-9.92

* The Reporting Period thereafter means three months from July to September in 2022.

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2.2 Excluded non-recurring items and amount

Unit: RMB’000

Item	Amount for the Reporting Period	Amount from the beginning of the year to the end of the Reporting Period	Note
Earnings or losses on disposal of non-current assets	-79	-6,039	—
Government grants recognized in current profits and losses, except for closely related to the regular operating of the Company, comply with national policies and regulations, and continuously comfort according to certain standards, quotas or quantities	9,779	20,684	—
In addition to the effective hedging business related to the Company’s normal business, the earnings or losses from changes in fair value arising from the holding of trading financial assets, derivative financial assets, trading financial liabilities, derivative financial liabilities, and the investment income from the disposal of trading financial assets, derivative financial assets, trading financial liabilities, derivative financial liabilities, and other debt investments	1,260	-17,045	Amount in the Reporting Period: structural deposit income 1,506, loss on disposal of derivative financial instruments -246, loss on changes in fair value of financial assets and liabilities 0; Amount from the beginning of the year to the end of the Reporting Period: structural deposit income 10,806, loss on disposal of derivative financial instruments - 18,864, loss on changes in fair value of financial assets and liabilities - 8,987
Earnings or losses from entrusted loans	37	2,704	—
Other non-operating income and expenses other than those mentioned above	-31,394	-51,500	—
Other earnings or losses meeting the definition of non-recurring earnings or losses	-21,740	-32,178	Amount in the Reporting Period: -21,270 for dismissal welfare and - 470 for discount loss of receivables; Amount from the beginning of the year to the end of the Reporting Period: -29,521 for dismissal welfare and -2,657 for discount loss of receivables
Less: Tax effect for the items above	3,786	11,492	—
Effect on Non-Controlling interests (after tax)	698	764	—
Total	-37,653	-71,118	—

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2.3 Description of Substantial Changes in Major Financial Report Items and Financial Indicators of the Company

Item	Change (%)	Major reason
Operating Profit_during the Reporting Period	-51.96%	On 18 June 2022, an explosion accident occurred in the Company’s No.1 ethylene glycol plant. After the accident, the main production equipment of the Company was shut down, resulting in a decline in sales revenue and operating performance in the Reporting Period. As of the end of the Reporting Period, the main production equipment of the Company has resumed production.
Net profit attributable to equity shareholders of the Company_during the Reporting Period	-317.35%
Net profit attributable to equity shareholders of the Company excluding non-recurring items_during the Reporting Period	-313.63%
Basic earnings per share (RMB/share)_ during the Reporting Period	Not Applicable
Diluted earnings per share (RMB/share)_ during the Reporting Period	Not Applicable
Net profit attributable to equity shareholders of the Company_ from the beginning of the year to the end of the Reporting Period	-201.92%	From the beginning of the year to the end of the Reporting Period, the average price rise of petrochemical products was less than the average price rise of crude oil. Meanwhile, on 18 June 2022, an explosion accident occurred in the Company’s No.1 ethylene glycol plant. After the accident, the main production equipment of the Company was shut down. The above reasons resulted in a significant decline in the Company’s operating performance.
Net profit attributable to equity shareholders of the Company excluding non-recurring items_from the beginning of the year to the end of the Reporting Period	-202.46%
Basic earnings per share (RMB/share)_ from the beginning of the year to the end of the Reporting Period	Not Applicable
Diluted earnings per share (RMB/share)_ from the beginning of the year to the end of the Reporting Period	Not Applicable
Net cash flows generated from operating activities_ from the beginning of the year to the end of the Reporting Period	Not Applicable	From the beginning of the year to the end of the Reporting Period, the cash received from selling goods and providing services decreased compared with the same period last year, and the cash paid for purchasing goods and receiving services increased compared with the same period last year.

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3. Shareholder’s Information

3.1 Total Number of Shareholders as at the End of the Reporting Period, Top Ten Shareholders and Shareholdings of the Top Ten Shareholders of Shares in Circulation (or Unrestricted Shares)

											Unit: Share
Number of shareholders as at the end of the Reporting Period	102,846	Total number of preferred shareholders with voting rights restored as at the end of the Reporting Period (if any)								0
Shareholdings of the top ten shareholders
Name of shareholder	Type of shareholder	Number of shares held at the end of the Reporting Period		Percentage of total shareholding (%)		Number of shares with selling restrictions		Number of shares pledged, marked or frozen
								Situation of the shares		Number
China Petroleum & Chemical Corporation	State-owned legal person		5,459,455,000		50.44		0		None		0
HKSCC (Nominees) Limited	Overseas legal person		3,452,738,030		31.90		0		Unknown		0
HKSCC Limited	Others		74,574,892		0.69		0		None		0
Wang Lei	Domestic natural person		46,120,300		0.43		0		None		0
GF Fund – Agricultural Bank of China – GF CSI Financial Asset Management Plan	Others		45,222,300		0.42		0		None		0
Dacheng Fund – Agricultural Bank of China – Dacheng CSI Financial Asset Management Plan	Others		43,531,469		0.40		0		None		0
Southern Fund– Agricultural Bank of China – Southern CSI Financial Asset Management Plan	Others		43,083,700		0.40		0		None		0
Yinhua Fund– Agricultural Bank of China – Yinhua CSI Financial Asset Management Plan	Others		43,051,716		0.40		0		None		0
E Fund Fund– Agricultural Bank of China – E Fund CSI Financial Asset Management Plan	Others		43,038,700		0.40		0		None		0
Bosera Fund – Agricultural Bank of China – Bosera CSI Financial Asset Management Plan	Others		42,675,700		0.39		0		None		0

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Shareholdings of the Top Ten Shareholders with Unlimited Conditions of Sale
Name of shareholder	Number of Liquidity Shares Holding Unlimited Conditions of Sale		Type and quantity of shares
			Type		Quantity
China Petroleum & Chemical Corporation		5,459,455,000		RMB common stocks		5,459,455,000
HKSCC (Nominees) Limited		3,452,738,030		Overseas listed foreign share		3,452,738,030
HKSCC Limited		74,574,892		RMB common stocks		74,574,892
Wang Lei		46,120,300		RMB common stocks		46,120,300
GF Fund – Agricultural Bank of China – GF CSI Financial Asset Management Plan		45,222,300		RMB common stocks		45,222,300
Dacheng Fund – Agricultural Bank of China – Dacheng CSI Financial Asset Management Plan		43,531,469		RMB common stocks		43,531,469
Southern Fund– Agricultural Bank of China – Southern CSI Financial Asset Management Plan		43,083,700		RMB common stocks		43,083,700
Yinhua Fund– Agricultural Bank of China – Yinhua CSI Financial Asset Management Plan		43,051,716		RMB common stocks		43,051,716
E Fund Fund– Agricultural Bank of China – E Fund CSI Financial Asset Management Plan		43,038,700		RMB common stocks		43,038,700
Bosera Fund – Agricultural Bank of China – Bosera CSI Financial Asset Management Plan		42,675,700		RMB common stocks		42,675,700
Explanation of the related relationship or acting in concert relationship of the above shareholders		Among the above-mentioned shareholders, China Petroleum & Chemical Corporation, a state-owned legal person, does not have any related relationship with the other shareholders, and does not constitute an act-in-concert party under the Administration Measures on Acquisition of Listed Companies. Among the above-mentioned shareholders, HKSCC (Nominees) Limited is a nominee and HKSCC Limited is the nominal holder of the Company’s Shanghai- Hong Kong Stock Connect. Apart from the above, the Company is not aware of any other related relationships among the other shareholders, or whether any other shareholder constitutes an act-in-concert party under the Administrative Measures on Acquisition of Listed Companies.

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4. Other reminders

On 18 June 2022, an explosion accident occurred in the Company’s No.1 ethylene glycol plant, causing a fire on surrounding pipelines. The Company took protective shutdown measures for the main production equipment based on safety considerations. After the accident, the Company carried out restorative maintenance on the production equipment affected by the accident, and orderly promoted the resumption of work and production in three stages: in the first stage, the main equipment of oil refining was resumed and five processing lines were arranged to cooperate with the starting up; In the second stage, the Company improved the production capacity of chemical raw materials and plastic products, and arranged the commencement of ethylene old area lines; In the third stage, the production capacity of the whole plant was fully restored and the ethylene new area line was arranged to start. As of 30 September 2022, the No. 2 ethylene glycol plant of the chemical department of the Company started up smoothly and produced qualified products, and the work of resuming production was completed.

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5. Appendix

5.1 CONSOLIDATED BALANCE SHEETS

AS AT 30 SEPTEMBER 2022

			Unit: RMB’000
Items	As at 30 September 2022		As at 31 December 2021
	(Unaudited)		(Audited)
Current assets
Cash at bank and on hand		9,087,458		12,498,617
Transactional financial assets		1,010,806		—
Derivative financial assets		176,863		81,405
Accounts receivable		1,898,544		1,169,405
Accounts receivable financing		511,178		1,072,690
Advances to suppliers		140,921		60,577
Other receivables		20,993		108,728
Inventories		7,466,394		5,923,525
Other assets classified as held for sale		71,147		17,329
Total current assets		20,384,304		20,932,276
Non-current assets
Long-term equity investments		3,614,210		4,188,888
Investment in other equity instruments		5,000		5,000
Investment properties		340,694		352,188
Fixed assets		12,303,506		11,328,065
Construction in progress		2,754,769		3,293,177
Right-of-use assets		18,892		4,879
Intangible assets		377,632		392,608
Long-term prepaid expenses		801,708		775,963
Deferred tax assets		672,471		184,143
Other non-current assets		3,416,103		5,581,435
Total non-current assets		24,304,985		26,106,346
Total assets		44,689,289		47,038,622

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CONSOLIDATED BALANCE SHEETS (CONTINUED)

AS AT 30 SEPTEMBER 2022

			Unit: RMB’000
Items	As at 30 September 2022		As at 31 December 2021
	(Unaudited)		(Audited)
Current liabilities
Short-term borrowings		2,060,000		1,540,000
Derivative financial liabilities		6,670		23,804
Notes payable		127,640		830,006
Accounts payable		6,271,548		5,888,879
Contract liabilities		692,851		430,882
Employee benefits payable		843,929		260,096
Taxes payable		1,255,711		4,070,663
Other payables		1,101,360		1,287,064
Non-current liabilities due within one year		11,045		23,029
Other current liabilities		4,063,254		1,441,320
Total current liabilities		16,434,008		15,795,743
Non-current liabilities
Long-term borrowings		700,000		700,000
Lease liabilities		10,836		1,384
Deferred revenue		124,939		112,720
Deferred tax liabilities		31,381		33,344
Total non-current liabilities		867,156		847,448
Total liabilities		17,301,164		16,643,191
Owners’ equity (or shareholders’ equity)
Paid-in capital (or share capital)		10,823,814		10,823,814
Capital surplus		614,187		610,327
Other comprehensive income		128,051		59,425
Specific reserve		228,809		216,512
Surplus reserve		6,672,639		6,672,639
Undistributed profits		8,792,289		11,877,455
Total equity attributable to equity owners (or shareholders) of the Company		27,259,789		30,260,172
Non-Controlling interests		128,336		135,259
Total owners’ equity (or shareholders’ equity)		27,388,125		30,395,431
Total liabilities and owners’ equity (or shareholders’ equity)		44,689,289		47,038,622

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5.2 CONSOLIDATED INCOME STATEMENTS

FOR THE NINE MONTHS ENDED 30 SEPTEMBER 2022

Unit: RMB’000 Audit type: unaudited

Items	First three quarters of 2022 (January to September)		First three quarters of 2021 (January to September)
Total revenue		57,778,561		61,863,093
Including: Revenue		57,778,561		61,863,093
Total operating cost		59,745,874		60,150,245
Including: Cost of sales		51,267,019		48,013,441
Taxes and surcharges		6,972,764		9,194,779
Selling and distribution expenses		211,241		322,451
General and administrative expenses		1,586,069		2,828,633
R&D expenses		82,916		75,153
Financial expenses		-374,135		-284,212
Add: Other income		12,471		25,331
Investment income (“-” to indicate loss)		-185,032		777,741
Change in fair value gains (“-” to indicate loss)		1,819		27,278
Credit impairment losses (“-” to indicate loss)		-4,893		—
Asset impairment losses (“-” to indicate loss)		-262,962		-108,485
Asset disposal income (“-” to indicate loss)		-1,062		79,085

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CONSOLIDATED INCOME STATEMENTS (CONTINUED)

FOR THE NINE MONTHS ENDED 30 SEPTEMBER 2022

Unit: RMB’000 Audit type: unaudited

Items	First three quarters of 2022 (January to September)		First three quarters of 2021 (January to September)
Operating profit (“-” to indicate loss)		-2,406,972		2,513,798
Add: Non-operating income		15,135		11,365
Less: Non-operating expenses		63,399		72,881
Total profit (“-” to indicate loss)		-2,455,236		2,452,282
Less: Income tax expenses		-456,962		480,882
Net Profit (“-” to indicate loss)		-1,998,274		1,971,400
Classification by business continuity
1.  Net profit from continuing operations (“-” to indicate loss)		-1,998,274		1,971,400
Classification by ownership
1.  Attributable to equity shareholders of the Company (“-” to indicate loss)		-2,002,785		1,965,050
2.  Non-Controlling interests (“-” to indicate loss)		4,511		6,350
Other comprehensive income, net of tax		220,443		77,450
Net income after tax of other comprehensive income attributable to the equity shareholders of the Company		220,443		77,450
2.  Other comprehensive income reclassified into earnings or losses		220,443		77,450
a.   Other comprehensive income that can be transferred to profit or loss under equity method		-22,558		702
b.  Cash flow hedging reserve		243,001		76,748
Total comprehensive income		-1,777,831		2,048,850
Attributable to equity shareholders of the Company		-1,782,342		2,042,500
Attributable to Non-Controlling interests		4,511		6,350
Earnings per share
Basic earnings per share (RMB)		-0.185		0.182
Diluted earnings per share (RMB)		-0.185		0.182

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5.3 CONSOLIDATED CASH FLOW STATEMENTS

FOR THE NINE MONTHS ENDED 30 SEPTEMBER 2022

Unit: RMB’000 Audit type: unaudited

Items	First three quarters of 2022 (January to September)		First three quarters of 2021 (January to September)
1.  Cash flows from operating activities
Cash received from sales of goods or rendering of services		62,557,584		65,528,288
Refund of taxes and surcharges		1,183,540		98,018
Cash received relating to other operating activities		180,928		165,997
Sub-total of cash inflows		63,922,052		65,792,303
Cash paid for goods and services		55,594,090		51,964,737
Cash paid to and on behalf of employees		2,267,514		2,107,455
Payments of taxes and surcharges		10,385,945		11,784,185
Cash paid relating to other operating activities		408,833		279,537
Sub-total of cash outflows		68,656,382		66,135,914
Net cash flows generated from operating activities		-4,734,330		-343,611
2.  Cash flows from investing activities
Cash received from investment recovery		150,000		4,700,000
Cash received from returns on investments		671,805		746,659
Net cash received from disposal of fixed assets, intangible assets and other long-term assets		10,401		69,099
Cash received relating to other investing activities		8,957,483		3,374,332
Sub-total of cash inflows		9,789,689		8,890,090
Cash paid to acquire fixed assets, intangible assets and other long-term assets		1,899,984		2,617,962
Cash paid for investment		1,000,000		8,150,000
Net cash received from subsidiaries and other business units		296,672		—
Cash paid to other related investment activities		2,802,657		1,999,537
Sub-total of cash outflows		5,999,313		12,767,499
Net cash flows generated from operating activities.		3,790,376		-3,877,409

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CONSOLIDATED CASH FLOW STATEMENTS (CONTINUED)

FOR THE NINE MONTHS ENDED 30 SEPTEMBER 2022

Unit: RMB’000 Audit type: unaudited

Items	First three quarters of 2022 (January to September)		First three quarters of 2021 (January to September)
3.  Cash flows from financing activities
Cash received from borrowings		16,485,000		18,663,131
Cash received from short-term bonds		5,000,000		—
Sub-total of cash inflows		21,485,000		18,663,131
Cash repayments of borrowings		15,984,800		16,951,131
Cash repayments of short-term bonds		3,000,000		—
Cash paid for distribution of dividends or profits and interest expenses		1,182,055		1,166,963
Cash paid for other financing activities		9,629		10,721
Sub-total of cash outflows		20,176,484		18,128,815
Net cash flows generated from financing activities		1,308,516		534,316
4.  Effect of foreign exchange rate changes on cash and cash equivalents		18,115		-2,063
5.  Net increase in cash and cash equivalents		382,677		-3,688,767
Add: Cash and cash equivalents at beginning of the Reporting Period		5,112,010		6,916,408
6.  Cash and cash equivalents at end of the Reporting Period		5,494,687		3,227,641

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By Order of the Board

Sinopec Shanghai Petrochemical Company Limited

Liu Gang

Joint Company Secretary

Shanghai, the PRC, 26 October 2022

As at the date of this announcement, the executive directors of the Company are Wan Tao, Guan Zemin, Du Jun and Huang Xiangyu; the non-executive directors of the Company are Xie Zhenglin and Peng Kun; and the independent non-executive directors of the Company are Li Yuanqin, Tang Song, Chen Haifeng, Yang Jun and Gao Song.

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