China's January-April industrial profits tumble 3.4 pct year-on-year

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China's industrial firms posted a 3.4-percent slump in profits in the January-April period, according to data from the National Bureau of Statistics (NBS) on Monday.

Profits notched up by industrial firms in the country shrank 3.7 percent year-on-year in April to 515.4 billion yuan (74.80 billion U.S. dollars) following robust gains in March.

Zhu Hong, a senior statistician from NBS, ascribed the comparatively large fluctuation to the reduction of value-added tax that began in April, which brought forward pent-up demand for some industrial goods and boosted profits in March.

Industrial companies' debt increased 5.5 percent from a year earlier to 63.87 trillion yuan by end-April.

Chinese authorities have pledged to stick with supply-side structural reform and a slew of tax cuts in response to downward pressure on the economy.

A battery plant in Huzhou, east China's Zhejiang Province. /VCG Photo

Structural improvement

On the positive side, consumer product manufacturers and equipment producers maintained relatively fast profit growth, reflecting structural improvement.

In the period, major special-purpose equipment producers recorded a 17.9 percent profit growth, while electrical machinery and device producers' profits climbed 14.5 percent.

The structural change was in line with a shift in China's economic growth drivers from exports and investment to domestic consumption and high-end industries.

The asset-liability ratio of major industrial firms continued to decline, Zhu said. The ratio stood at 56.8 percent at the end of April, down 0.5 percentage points from a year earlier.

For state-owned industrial companies, the ratio fell 1.1 percentage points to 58.4 percent, according to Zhu.

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

(With inputs from Xinhua)