Beijing Yanhua Petrochemical has confirmed plans to reshuffle assets under its parent, mainland petrochemical giant China Petrochemical Corp (Sinopec), ahead of Sinopec's listing later this year. However, chairman Du Guosheng did not comment on speculation mainland authorities intend to privatise or merge some subsidiaries as part of the restructuring process, and market talk that some Sinopec subsidiaries would swap assets with those under rival China National Petroleum Corp (CNPC). 'Whichever way Sinopec chooses to restructure the group, I believe it would be one that would give the overall group the maximum benefit,' Mr Du said. Beijing Yanhua is one of four Hong Kong-listed subsidiaries of Sinopec. Analysts speculated the restructuring would promote greater operating efficiencies through tighter co-operation between subsidiaries under Sinopec and CNPC, both fully integrated petroleum and petrochemical giants with upstream oil exploration and downstream refining operations. Beijing Yanhua reported on Monday a 144.6 per cent surge in net profit to 243.63 million yuan (about HK$228.25 million) for the six months to June 30. Turnover rose 43.2 per cent to four billion yuan. Mr Du attributed the sales growth to stronger domestic demand, coupled with significant product price increases and greater economies of scale through expanded and renovated production facilities. A 38.8 per cent sales volume rise to 228,900 tonnes in high-margin specialised products resulted in a 3.7 per cent increase in overall operating profit margin to 10.9 per cent. The firm plans to invest between 1.7 billion yuan and 1.9 billion yuan on capital expenditure this year and next, involving 300 million yuan and one billion yuan, which will be financed from internal resources. The expenditure will mostly be used on expansion and renovation of its ethylene production unit. Mr Du expects the firm's average product price to continue rising in the second half, after increasing 29.1 per cent year on year in the first half, on the back of higher crude oil prices.