China's industrial profits decline at slower pace in July

Profits at China's major industrial companies declined at a slower pace in July, with sectors led by high-tech manufacturing reporting rapid growth, official data showed on Wednesday.

Data from the National Bureau of Statistics showed that industrial enterprises with annual revenue of at least 20 million yuan ($2.8 million) saw their total profits dip 1.5 percent from a year earlier in July, compared to a 4.3 percent fall in June.

For the January-July period, China's industrial profits dropped 1.7 percent year-on-year to 4.02 trillion yuan, following a 1.8 percent decline in the first half of the year.

NBS statistician Yu Weining attributed the improvement in industrial profits to the steady growth in industrial output, which Yu said was a result of sustained policy efforts to stabilize prices and boost demand.

Meanwhile, Yu warned of challenges ahead, with mounting external uncertainties, sluggish domestic demand, and persistent supply-demand imbalances in certain sectors weighing on momentum.

Moving forward, Yu stressed the need to maintain the continuity and stability of existing policy measures, and at the same time, enhance their flexibility and foresight. More efforts should also be made to expand domestic demand, strengthen innovation-driven growth, accelerate the cultivation of new quality productive forces, and advance the transformation and upgrading of traditional industries.

NBS data showed that in the first seven months, profits recorded by manufacturing companies rose by 4.8 percent year-on-year, and profits registered by industrial firms that offer supplies of electricity, heat, gas and water grew by 3.9 percent. Meanwhile, profits recorded by mining firms shrank 31.6 percent.

According to a breakdown of the NBS data, State-owned firms saw earnings dip 7.5 percent year-on-year in the first seven months. Foreign firms booked a 1.8 percent rise, and private-sector companies also recorded a 1.8 percent growth.

Notably, profits at high-tech manufacturing industries surged 18.9 percent in July, reversing the 0.9 percent drop in June and driving July's overall industrial profit growth to accelerate by 2.9 percentage points from the previous month.

Aerospace stood out, with profits in the air and space vehicles and equipment manufacturing sector jumping 40.9 percent in July as China's space and aviation programs advanced to higher levels of technological sophistication.

Semiconductors also contributed strongly, supported by improving self-reliance in core technologies. Profits in integrated circuit manufacturing surged 176.1 percent last month, while makers of semiconductor equipment recorded 104.5 percent growth.

The biopharmaceutical sector continued its steady high-quality development, with profits up 36.3 percent in biomedicine manufacturing and 6.9 percent in chemical drug formulation last month, according to the NBS.