Profits earned by China's industrial firms slid by 38.3 percent year on year to 410.7 billion yuan (58.15 billion U.S. dollars) in the first two months of 2020, the statistics bureau said on Friday.

The decline follows December's 6.3-percent drop, last year the fall was 14 percent year on year because of the Chinese Spring Festival holiday.

The profit decrease is expected to be short-termed, according to the statement issued by the statistics bureau on its website, the industrial firms' profits will be improved soon as the virus outbreak on the Chinese mainland is already under control, and the work resumption process in China is speeding up.

Among industrial enterprises above designated firms, China's state-owned holding enterprises' profits dropped by 32.9 percent, the profits of joint-stock companies dropped by 33.6 percent, while for private companies the figure stands at 36.6 percent.

Foreign-invested, Hong Kong SAR, Macao SAR and Taiwan-invested enterprises saw the biggest profit dive, 53.6 percent.

Among 41 major industries, four saw year-on-year profit increase in the first two months, the total profit of tobacco companies increased by 31.5 percent, while the oil and gas extraction industry witnessed a 23.7-percent increase, the non-ferrous metal smelting and rolling processing industry saw a 28.3-percent hike in profits, the agricultural and sideline products processing industry posted a 2.2-percent rise in profits.

The rest of the 37 major industries in China, including manufacturing, electricity, heat production and supply, all experienced losses.

Liabilities at industrial firms grew by 5.3 percent year on year in February-end, as opposed to a 5.4-percent increase in the end of 2019.

The data covers large companies with annual revenue of more than 20 million yuan from their main operations.

The decline in profits points to the disruption of production because of the coronavirus outbreak, enterprises across the country postponed work resumption date after the Chinese Spring Festival Holiday in January, and even after production resumed in February, it's still not in full capacity because the local governments and factories had to enforce some measures such as limit the number of workers in factories to maintain a certain distance between one another to control and prevent the spread of the virus.

The production cost has also increased as companies had to allocate a large sum of revenue for epidemic prevention equipment, which has also eaten into companies' profits.