Business / BYD

BYD reports deepest decline in profits in 2011

By Li Fangfang ( Updated: 2012-03-26 22:56

The Chinese battery and carmaker BYD Co Ltd reported on Sunday that it saw a record decrease in its profits and vehicle sales in its 2011 financial year, which ended on Dec 31.

That aroused concerns that the company will have a difficult time achieving its goal of having the most automobiles sales of any being Chinese company by 2015.

Statistics from the company's financial report showed that BYD's revenues decreased by no more than 1 percent from a year earlier, coming in at 46.31 billion yuan ($7.3 billion). Even so, its gross profit dived by 17 percent to 6.87 billion yuan, and its profits attributed to equity holders declined sharply by 45 percent to 1.38 billion yuan.

The company's shares on the Shenzhen Stock Exchange gained 1.81 percent to close at 26.47 yuan apiece on Monday, while its stock price dropped by 4.82 percent to hit HK$19.94 a share in Hong Kong.

The Shenzhen-based company, which the US billionaire Warren Buffett has invested in, blamed the profit decrease on its waning battery business, which has been harmed by a slowdown in the demand for traditional mobile phones and on its shrinking share of the market for notebook computers. The company's rechargeable batteries and new-energy businesses were also harmed by the decline in demand in the European market for photovoltaic equipment.

BYD also said its automobile sales decreased by 13.33 percent in 2011 from the previous year, declining to 437,000 vehicles. For the year before, the company had set an ambitious target of selling 800,000 vehicles but eventually sold 520,000.

Despite the sales decline, BYD said in the financial report that its vehicle business had 22 billion yuan in revenue in 2011, a slight increase year-on-year.

(For full story, please see March 27 China Daily page 15.)

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