Xinxing Pipes H1 profit roars up and beats forecasts
Monday, 20 Jul 2009
Shanghai Securities News reported that Xinxing Ductile Iron Pipes Co, Ltd issued its H1 earnings the first of its kind in China YTD.
According to the report, total profit of the company in the first six months posts at CNY 780 million up by 27.2%YoY from a year ago while operating profit goes at CNY 729 million up by 23.52%. Earnings per share stand at CNY 0.402.
Profitability surged up in the Q2 than the first one. According to the report, profit in the first trimester posts at CNY 135 million then climbs to CNY 337 million in the second trimester, surging 149.63% on quarter. The more than expected profit margin beats market forecasts and due mainly to the healthy production and sales of its cast tube products boosted by the CNY 4 trillion stimulus plans.
Despite the positive growth, Xinxing Pipes confesses the difficulties in the second half. Price rises for construction steel products have overtaken that of raw materials. That means price for the latter would roar up in days to come, which would increase costs pressure.
Meanwhile, the pace of construction steel capacity expansion has outstripped that of the recovering market fundamentals, which is set to exacerbate the already oversupply picture. Therefore, prices for the products still faces downward risks amid the uncertain global economy and market demand.
