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Mainland companies see profits dive
By Winny Wang |
February 25, 2009, Wednesday
|
Online Edition
Online Edition
THE combined profits for 1,009 listed companies on the Chinese mainland dropped 43.61 percent last year on an annual basis, according to preliminary and annual earnings reports.
The profits, accounting for 32.18 percent of all the mainland-listed companies' profits in 2007, reached 173.6 billion yuan (US$25.40 billion) last year, according to figures compiled by TX Investment Consulting Co.
Among the 93 companies which have so far reported their annual results, only seven firms reported losses last year and 40 firms reported profit growth in the period. Their combined profit gained 15.6 percent to 14.3 billion yuan.
Combined profits for 916 companies which have released preliminary reports slumped 46.1 percent to 159.2 billion yuan, and only 41 percent of them predicted a profitable result for last year.
Profitable companies were found in coal, construction, telecommunication, shipping and banking and companies that did not perform so well were in the hotel, aviation, insurance, securities, power and steel industries, TX Investment said.
Although the Chinese government has issued stimulus packages, including spending 4 trillion yuan by the end of 2010, to boost domestic demand, analysts are still concerned that sharply slowing economic growth will erode corporate earnings and magnify stock-price volatility.
The State Council, China's Cabinet, has approved stimulus packages targeted at several key sectors, including light industry, petrochemical, electronics and information technology. The market is expecting more economic measures from the annual session of the National People's Congress next month.
TX Investment suggested investors focus on construction materials, power supplies, chemical and machinery industries.
Firms listed on the Chinese mainland publish annual earnings reports from January to April.
The profits, accounting for 32.18 percent of all the mainland-listed companies' profits in 2007, reached 173.6 billion yuan (US$25.40 billion) last year, according to figures compiled by TX Investment Consulting Co.
Among the 93 companies which have so far reported their annual results, only seven firms reported losses last year and 40 firms reported profit growth in the period. Their combined profit gained 15.6 percent to 14.3 billion yuan.
Combined profits for 916 companies which have released preliminary reports slumped 46.1 percent to 159.2 billion yuan, and only 41 percent of them predicted a profitable result for last year.
Profitable companies were found in coal, construction, telecommunication, shipping and banking and companies that did not perform so well were in the hotel, aviation, insurance, securities, power and steel industries, TX Investment said.
Although the Chinese government has issued stimulus packages, including spending 4 trillion yuan by the end of 2010, to boost domestic demand, analysts are still concerned that sharply slowing economic growth will erode corporate earnings and magnify stock-price volatility.
The State Council, China's Cabinet, has approved stimulus packages targeted at several key sectors, including light industry, petrochemical, electronics and information technology. The market is expecting more economic measures from the annual session of the National People's Congress next month.
TX Investment suggested investors focus on construction materials, power supplies, chemical and machinery industries.
Firms listed on the Chinese mainland publish annual earnings reports from January to April.
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