Profits of China's major industrial firms slumped in the first two months of 2020 due to the novel coronavirus outbreak. This has come as a huge blow to industrial production, data from the National Bureau of Statistics (NBS) showed. Profits of industrial companies with annual revenue of more than 20 million yuan (about 2.84 million U.S. dollars) totaled 410.7 billion yuan in the January-February period, down 38.3 per cent year on year, NBS said in a statement.
Many industrial companies suspended operation during February in response to the novel coronavirus disease, resulting in a significant decline in production and sales, said NBS official Zhang Weihua.
Factors including rising costs, lower prices of industrial products and reduced profit margins for most industrial sectors also contributed to the drop, Zhang said. Profits in 37 of the 41 industrial sectors surveyed fell compared with one year earlier, according to the NBS.
Industrial firms in the manufacturing sector saw combined profits slump by 42.7 per cent year on year while firms in the mining industry registered profit decline of 21.1 per cent. Profits of state-owned industrial firms dropped 32.9 percent from one year earlier while that for private companies fell 36.6 percent.