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Plane firm soars after net profit rises 324%

XI'AN Aircraft International Corp surged by the daily limit of 10 percent yesterday after posting a 324-percent surge in net profit last year.

Its net earnings surged to 389 million yuan, or 0.36 yuan a share, last year against 92 million yuan in 2007, and its revenue soared 332 percent to 9.36 billion yuan, the plane-parts maker said in a statement to the Shenzhen Stock Exchange yesterday. Its shares rose 10 percent to 22.20 yuan yesterday.

"Its controlling shareholder AVIC Xi'an Aircraft Industry (Group) Co Ltd injected aircraft assembling and sales businesses as well as subcontracting business of foreign aircraft parts into the company, which greatly enhanced its performance," TX Investment Consulting Co said.

The company has received orders for 156 Xinzhou-series jets as well as a contract to supply as much as 3.26 billion yuan of components for the homemade ARJ21 jet to the government-owned Shanghai Aircraft Manufacturing Factory. It will also make components for China's homemade jumbo jet.

However, the statement also said that the financial crisis has dampened demand in the aviation industry and some clients had to delay or cancel some orders, which may affect its sales of Xinzhou-series jets. The company projected its revenue at 8.02 billion yuan this year and it will deliver 20 Xinzhou60 turboprops and components for five ARJ21 jets.

"The company is very likely to be the platform that Aviation Industry Corp of China will inject commercial plane making assets into," said Li Xiaoguang, an analyst at Shenyin Wanguo Securities Co.


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