Business / Markets

ChiNext profit growth hits five-year high

(Xinhua) Updated: 2016-03-02 16:04

BEIJING - The average net profit of firms listed on the ChiNext Index, China's NASDAQ-style board for start-ups, grew at its highest speed in five years in 2015.

Almost all ChiNext-listed companies unveiled their performance sheets by the end of February, reported the official Securities Times on Wednesday.

The 500-some ChiNext-listed companies raked in an average net profit of 125 million yuan ($19.1 million) last year, up 27.8 percent year on year. Their revenue on average also rose at a 5-year high of 29.4 percent year on year.

A total of 322 companies reported increased profits, accounting for 65 percent of the total, while 173 firms saw declines. The percentages of companies with gains versus those with losses were similar to the numbers reported in 2014.

Among the gainers in 2015, nine witnessed a dramatic surge in net profits of more than 500 percent. They include East Money, Nationz Technologies and EDAN Instruments.

A total of 71 companies reported their profits more than doubled last year, including Baofeng Technology Co, Anhui Shengyun Machinery Co and Jinlong Machinery & Electronics Co Ltd.

Firms in emerging industries, such as the Internet, environmental protection, electronic machinery, software and information technology, took the lead in profit gains.

The Internet industry reported profit growth of 146 percent year on year in 2015.

While emerging industries reported gains, ChiNext-listed companies in traditional sectors turned to asset swaps and other means to improve their weak performance.

The data show the growth engine has steadily moved from traditional sectors to emerging industries as China pushes to restructure its economy.

The profits of major industrial firms in 2015 fell year on year for the first time in over a decade, the National Bureau of Statistics (NBS) data showed.

Although the overall situation is grim, the high-tech industry, equipment manufacturing companies and consumer goods producers posted profit gains of 8.9 percent, 4 percent and 7 percent, respectively.

China's policy makers are striving to steer the economy away from an export-driven, credit-fueled growth model to one based on innovation, stronger consumer spending and the service sector.

Consumption accounted for 66.4 percent of GDP in 2015, up 15.4 percentage points from 2014, while the service sector contributed 50.5 percent to the economy in 2015, up from 48.1 percent in 2014, according to official data.

China is implementing supply-side structural reforms, featuring better provision of high-quality goods and services, to shore up growth as demand-side management, such as investment stimulus, has become less effective.

The country's GDP growth slowed to 6.9 percent in 2015, the lowest level in 25 years.

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