China's industrial profits improve in January-July

China's industrial profits improve in January-July

Chinese industrial businesses saw faster growth in profits in the first seven months of this year thanks to lower costs and the country's growth-stabilizing measures, official data showed on Thursday.

Total profits of industrial companies rose 11.7 percent year on year to reach 3.34 trillion yuan (542 billion U.S. dollars) during the January-July period, accelerating 0.3 percentage points from the first half of the year, the National Bureau of Statistics (NBS) said.

Core business of those industrial companies contributed to about 93.3 percent of total profits, or 3.13 trillion, according to the NBS.

In July alone, industrial companies reaped combined profits of 482.33 billion yuan, which was 13.5 percent larger than a year ago. But the July growth was 4.4 percentage points lower than that in June, indicating that the momentum has yet to be consolidated.

He Ping, an NBS statistician, said measures adopted by the government to stabilize economic growth have helped industrial companies keep steady growth in their sales revenues.

Price declines in raw materials also improved the profitability of downstream industries, He said.

In the January-July period, the industrial firms' profit margin of core business stood at 5.54 percent, down from 5.57 percent in the January-June period.

The NBS data showed that about four-fifths of the profits came from the manufacturing sector, which posted an annualized increase of 15.6 percent with a combined profit of 2.69 trillion yuan.

The mining sector, however, saw its total profits fall by 13.2 percent year on year in the first seven months, narrowing from a decline of 14.6 percent in the January-June period.

Foreign-funded enterprises and companies with funds from Hong Kong, Macao and Taiwan posted the strongest growth in profits during the first seven months, with an annual increase of 16.1 percent, compared with 15.3 percent in the first half of the year.

In contrast, profits by state-owned and state-holding industrial enterprises expanded only 6.3 percent to 869.13 billion yuan, marking slower growth compared to their private or joint-stock peers.