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September 1, 2009

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Home » Business » Economy

Firms' profit in Q2 recovers

NET profit for companies listed on the Chinese mainland dropped 14.79 percent in the first half of this year from a year earlier, but their second-quarter earnings showed signs of recovery thanks to the government's massive stimulus policies.

A total of 1,637 listed companies, except Shenzhen Benelux Enterprise Co Ltd which missed the deadline to publish its report, reaped 481 billion yuan (US$70.42 billion) in profit in the first half of this year, compared with a fall of 26 percent year on year in the first quarter.

However, the companies saw their second-quarter profits gain 36.1 percent from the first quarter and nearly half of them expected further improvement in the third quarter. In the second quarter, 175 companies returned to the black.

"Listed firms improved in the second quarter of this year with the recovery of the gross domestic product," and the trend from now is upward, said GF Securities Co.

The State Information Center, a research unit under the National Development and Reform Commission, predicted that China's GDP is likely to grow 8.5 percent in the third quarter, after expanding 7.9 percent in the second quarter and 6.1 percent in the first quarter.

Of the companies, 867 Shanghai-listed firms earned 436.9 billion yuan in the first half, declining 9.12 percent from a year earlier. But they made 252.5 billion yuan in the second quarter, rising 5.43 percent from a year earlier and 36.96 percent on a quarterly basis. Ten companies which earned the most profits contributed 70 percent of the total earnings, and they included the Industrial and Commercial Bank of China, China Construction Bank, Sinopec and PetroChina.

"The implementation of the central government's 4 trillion yuan stimulus package helped prevent most listed companies from posting a profit decline," the Shanghai bourse said on its Website yesterday.


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