Profits of China’s major industrial firms rose 4.8 per cent year on year in the first two months of 2016, reversing the downward trend of last year, official data showed Sunday.
Profits at industrial companies with annual revenues of more than 20 million yuan (about $3.1 million) totaled 780.7 billion yuan in the Jan.-Feb. period, the National Bureau of Statistics (NBS) said.
Profits rose at their fastest pace in 18 months.
China’s industrial profits registered a 4.7 per cent year-on-year fall in December and a 2.3 per cent annual decrease in 2015.
He Ping, an official with the NBS Department of Industry, attributed the latest profit growth to increased sales and a milder decline in factory product prices.
In the first two months, revenues from the firms’ primary business climbed 1 per cent year on year, improving from a 0.6 per cent drop in December 2015 and a 0.8 per cent increase for last year.
In the Jan.-Feb. period, China’s producer price index, which measures prices of goods at factory gate, slipped 5.1 per cent year on year, narrowing from a drop of 5.9 per cent in December and 5.2 per cent for 2015.
Despite the recovery, part of the industrial profit growth was a result of the lower base in the same period of last year, He noted.
Industrial profits dipped 4.2 per cent year on year in the Jan.-Feb. period of 2015, NBS data showed.
Compared with the same period of 2014, the Jan.-Feb. industrial profits of this year only inched up 0.4 per cent, said He.
The Chinese leadership is working to reduce surplus industrial capacity in state enterprises, including planning major cuts to steel production capacity.