Hunan Nonferrous Metals Corp, China's biggest zinc and tungsten producer, said first-half profit fell by 75 percent after snowstorms cut production and zinc prices dropped.
Net income slipped to 74.2 million yuan (US$11 million), or 0.02 yuan a share, in the six months ended on June 30, from 301.9 million yuan, or 0.09 yuan, a year ago, the Hunan Province-based company said in a statement to the Hong Kong stock exchange yesterday. Sales fell 22 percent to 8.86 billion yuan.
The metal producer halted production at some plants in February as the country's worst snowstorms in 50 years damaged equipment and cut power supply. Zinc prices fell 36 percent in the first half from a year earlier as supplies outpaced demand, according to Bloomberg News.
"Since the international and domestic economic atmosphere is still unclear, the volatility of prices in the second half of the year is expected to be greater than that in the first half," the company said in the statement.
Hunan Nonferrous fell 3.1 percent to close at HK$1.26 (16 US cents) last Thursday in Hong Kong before the earnings announcement. The stock is down 74 percent this year compared with the 27 percent decline in the benchmark Hang Seng Index. Hong Kong's stock exchange was closed for trading last Friday due to Tropical Storm Nuri.
(Shanghai Daily August 25, 2008)
