In­dus­trial firms see profit growth slow

China Daily (USA) - - CHINA - By XIN ZHIMING xinzhim­ing@chi­nadaily.com.cn

Profit growth of China’s ma­jor in­dus­trial firms slowed in Septem­ber, but an­a­lysts said the coun­try’s cor­po­rate prof­itabil­ity may con­tinue to im­prove.

Prof­its of China’s ma­jor in­dus­trial firms, or those whose an­nual rev­enue from their main op­er­a­tions reaches or ex­ceeds 20 mil­lion yuan ($2.9 mil­lion), rose 7.7 per­cent year-on-year to 577 bil­lion yuan in Septem­ber, com­pared with 19.5 per­cent in Au­gust, the Na­tional Bu­reau of Sta­tis­tics said on Thurs­day.

To­tal prof­its of those firms for the first nine months reached 4.64 tril­lion yuan, up8.4 per­cent from the same pe­riod a year ago.

Prof­its in in­dus­tries such as elec­tron­ics, steel and elec­tric­ity reg­is­tered a sig­nif­i­cant drop in growth, He Ping, an NBS statis­ti­cian, said in an ar­ti­cle pub­lished on the bu­reau’s of­fi­cial web­site. He also said the ef­fect of a low base con­trib­uted to Septem­ber’s fall in profit growth, as prof­its rose at the slow­est pace since Au­gust last year.

An­a­lysts said cor­po­rate prof­its may con­tinue to im­prove as the world’s sec­ond-largest econ­omy is show­ing ini­tial signs of sta­bi­liz­ing.

“The sit­u­a­tion may con­tinue to im­prove as the coun­try’s ef­forts to cut ex­ces­sive pro­duc­tion ca­pac­ity and lower pro­duc­tion costs are show­ing re­sults, while the sta­bi­liz­ing econ­omy, ris­ing prices and lower costs will help in­dus­trial firms to in­crease prof­its,” said Liang Jing, an econ­o­mist at the In­sti­tute of In­ter­na­tional Fi­nance, a think tank af­fil­i­ated with the Bank of China.

Month-on-month, prof­its of China’s ma­jor in­dus­trial firms rose by 12.3 per­cent in the third quar­ter, far higher than the first and sec­ond quar­ters, when growth was 7 per­cent and 4.3 per­cent re­spec­tively, ac­cord­ing to a China Mer­chants Se­cu­ri­ties re­port. “The trend of in­dus­trial firms’ im­prov­ing prof­itabil­ity has not changed,” it said.

China’s GDP growth was 6.7 per­cent year-on-year in the third quar­ter, sig­nal­ing that the econ­omy is sta­bi­liz­ing amid wide­spread con­cerns that the main en­gine for global growth might lose steam.

CHINA DAILY

Source: Na­tional Bu­reau of Sta­tis­tics

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