Anhui Conch Cement Co, China’s largest cement producer, said it earned a smaller net profit in the third quarter than in the same period last year, as government measures to slow the economy began to affect its business.
While revenue for the September quarter rose to CNY2.06bn from CNY1.43bn in the year-earlier period, net profit fell to CNY131.63m from CNY192.17m. Operating costs rose sharply to CNY1.58bn from CNY883.57m a year earlier.
"Due to the austerity measures, the market demand for cement became less robust, while the price remained at a low level," the company said in a legal notice.
But a strong performance earlier in the year continued to buoy Anhui Conch’s finances. Revenue for the first three quarters of 2004 rose 65% from the same period a year ago to CNY5.88bn. Net profit was more than twice what it earned in the year-earlier period, at CNY923.55m, up from CNY413.98m.
Sales volume for the January-to-September period rose 38% from a year earlier to 24.62Mt. Anhui Conch said sales volume in the third quarter was 10.06Mt, 29% more than in the second quarter.
It said total sales volume for the second half of 2004 is likely to be 45% more than in the first half of the year.