Yunnan Chihong Zinc & Germanium Co, China's fifth-biggest zinc producer, said yesterday that first-half profit fell 69 percent after prices declined and snowstorms cut output and sales. The shares dropped 4.4 percent to close at 17.05 yuan yesterday.
Net income declined to 205 million yuan (US$30 million), or 0.26 yuan a share, the Qujing-based company told the Shanghai Stock Exchange. Sales in the six months were 2.6 billion yuan, 11 percent lower than a year earlier.
Zinc has lost 21 percent this year in London as the industry faces an oversupply. Output from China, the world's largest producer, rose in the first half, reaching the highest in more than five years.
"The result is lower than our expectation," Xiao Qun, an analyst at Haitai Securities Co, told Bloomberg News. The "plunge in zinc prices ate into the company's profit margins more than we thought."
(Shanghai Daily July 24, 2008)
