BEIJING, May 27 -- China's major industrial firms posted double-digit profit growth in the first four months of this year, the National Bureau of Statistics (NBS) said Saturday.
Industrial companies with annual revenues of more than 20 million yuan (about 2.92 million U.S. dollars) reported profits of 2.28 trillion yuan in the first four months, a 24.4-percent increase from one year earlier, the NBS said in a statement.
The profit growth has softened from a 28.3-percent increase in the first three months, but is still the highest January-April level since 2017.
In April alone, profits of major industrial firms rose 14 percent year on year to 572.78 billion yuan.
NBS statistician He Ping said the slowdown was "reasonable" after the breakneck growth in previous months, noting that there was still good momentum in industrial profit growth.
The industrial sector, which accounts for about one-third of China's GDP, started to pick up last year after profit declines in 2017, helped by government efforts to cut overcapacity and a recovery in the property sector.
Among the 41 industries surveyed, 38 posted year-on-year profit growth during the first four months.
Citing improving industrial indicators, He remains upbeat on the overall industrial performance, saying that there has been stronger support from consumer-goods manufacturing and high-tech manufacturing sectors, as well as a reduced debt burden.
In April, new profits from consumer-goods manufacturing accounted for 21.6 percent of the overall profit increase, up 9.8 percentage points from the March level, while high-tech manufacturing accounted for 23.2 percent of the total, up 19 percentage points from the previous month.
In the four months, major industrial firms also saw profitability of their primary business edge up 0.53 percentage points to 6.04 percent. By the end of April, their debt-asset ratio dropped 0.6 percentage points to 56.2 percent.
However, He pointed out that sectors like steel-making, auto-manufacturing and chemicals had witnessed significant declines in profit growth due to falling industrial price gains, lower production and sales growth and rising costs.
Profits from ferrous metal companies dropped 7.8 percent year on year in April, compared with a 1.3-fold increase in March, while auto makers reported a 6.7 percent drop in profits, down from a 18.7 percent rise in March.
He also attributed the overall growth decline to a slower rise in finished products and raw materials prices.
China's producer inflation continued to ease in April as retreating commodity prices pushed down factory-gate prices. The producer price index, which measures costs of goods at the factory gate, rose 6.4 percent year on year last month, compared with a 7.6 percent growth in March.
The statistician cautioned that a faster growth in producer purchasing prices, which climbed 9 percent in April, than that of factory-gate prices could lead to higher costs in midstream and downstream industries.
Rising financial expenses could also push up funding costs, he warned. In April, financial expenses of major industrial companies rose 4.2 percent year on year, accelerating from 3 percent in March.
China's value-added industrial output, an important economic indicator, expanded 6.5 percent year on year in April. For the first four months, industrial production expanded 6.7 percent year on year, according to previous NBS data.