Industrial profit growth slows to 7.7% in Sept
Favorable results for mining companies, SOEs
China’s industrial profits rose 7.7 percent year- on- year to 577.13 billion yuan ($ 85.25 billion) in September, official data showed Thursday.
The growth rate was slower than the 19.5 percent increase in August, said the National Bureau of Statistics ( NBS).
The NBS attributed the deceleration to slowing profit growth in the electronics, steel and power sectors as well as the weakening effect of a low base.
“The September deceleration shows that industrial profits returned to stable growth,” NBS statistician He Ping said on Thursday.
In the first nine months of 2016, industrial profits expanded 8.4 percent year- on- year, the same as the JanuaryAugust period.
The bureau’s calculations include companies whose annual revenues exceeding 20 million yuan.
The NBS statistician said that factory prices rose 0.1 percent year- on- year in September, ending a 54- month run of declines, which indicated the contradiction between supply and demand in domestic industry is easing.
Mining companies’ profits increased more than 30 percent year- on- year in September, ending monthly declines that began in October 2013.
Profits of State- owned enterprises ( SOEs) rose 47.6 percent in September, the data showed. The growth rate was a new high since January 2016.
The data and continuous declines in inventory, leverage and unit costs, showed the country’s supply- side structural reform has an effect, said He.
During the first eight months of the year, 31 of 41 industrial sectors that the NBS surveys reported year- on- year profit gains. Those of the petroleum process- ing, coking and nuclear fuel processing sectors, as well as the ferrous metal smelting and rolling processing industries, more than doubled.
In contrast, thermal power production and supply industry witnessed a 5.7 percent decrease in profits in the first nine months of 2016.
Despite the positive profit data, He warned of a grim outlook for industrial enterprises partially due to sluggish domestic and foreign demand as well as debt risks.