1. With an outstanding tax contribution, these companies have apparently improved their economic benefits.

The Top 500 Companies of China in 2010 made an outstanding contribution to the national tax revenue. They paid 2.12 trillion yuan for taxes, accounting for 35.7 percent of the national tax revenue of 5.95 trillion yuan. There are 44 companies whose tax revenue amounted to more than 10 billion yuan and 2 companies whose tax revenue surpassed 100 billion yuan. China National Petroleum Corporation (CNPC) paid 234.85 billion yuan for taxes and China Petroleum & Chemical Corporation (Sinopec) paid 226.74 billion yuan. For detailed information on the distribution, please refer to Table 1-4. 

Table 1-4. Tax payment of Top 500 Companies of China in 2010

 

Not only did the Top 500 Companies of China expand their scale in 2010, but their net profits rose sharply. Their average profits hit 3.04 billion yuan in 2010, 26.1 percent more than those over the previous year. Per capita profits reached 55,200 yuan, a 20 percent increase over the previous year. The average profit margin was 5.4 percent, up 7 percent from the previous year; the average return on assets (ROA) was 1.65 percent, a slight increase of 1.6 percent over the previous year.

The per capita revenue of the Top 500 Companies of China in 2010 amounted to 1.0068 million yuan, up 3 percent from the previous year. There are 17 companies whose per capita revenue surpassed 10 million yuan, among which Zhangjiagang Free Trade Zone Xinghengde Trading Co., Ltd., Tianjin Jinneng Investment Company and Zhuhai Zhen Rong Company got that of more than 100 million yuan. However, most companies, as high as 56.9 percent of the Top 500, had their per capita revenue within the scope of 1~5 million yuan.

There are 23 companies whose per capita assets surpassed 10 million yuan, among which Tianjin Jinneng Investment Company ranked first with 450 million yuan, followed by Zhangjiagang Free Trade Zone Xinghengde Trading Co., Ltd. with 270 million yuan. However, 56.2 percent of the Top 500 companies had per capita assets within the scope of 1~5 million yuan.

The owner's equity per capita of the Top 500 Companies of China in 2010 hit 587,700 yuan, 13 percent more than the previous year. There are only three companies whose owner's equity per capita surpassed 10 million yuan, among which Tianjin Jinneng Investment Company ranked first with 130 million yuan. As many as 56.9 percent of the Top 500 companies had owner's equity per capita of less than 500,000 yuan. For detailed information on the distribution, please refer to Table 1-5.

Table 1-5. Distribution of the Top 500 Companies of China in 2010 classified by per capita

 

2. Economic benefits are rather imbalanced among the Top 500 Companies of China in 2010.

Profits: Of the Top 500 Companies of China in 2010, 478 made a profit, accounting for 95.6 percent. There are 17 unprofitable companies, occupying 3.4 percent, and the other five did not make their profit figures available. There are 22 companies which gained net profits of more than 10 billion yuan. Their overall net profits hit 875.82 billion yuan, accounting for 58.2 percent of the total net profits of the Top 500. This indicates that most of the profits are actually from a minority of mega-sized companies. On the ranking board of profits, the Industrial and Commercial Bank of China (ICBC) took the first position with 129.35 billion yuan, 8.6 percent of the total profits of the Top 500. The overall profits of China's four big state-owned commercial banks accounted for 24.3 percent of the total.

Per capita profits: Of the Top 500 Companies of China in 2010, 15 posted per capita profits of more than 500,000 yuan, accounting for 3 percent of the list. There are 7 companies whose per capita profits surpassed 1 million yuan. Zhangjiagang Free Trade Zone Xinghengde Trading Co., Ltd. ranked first with 3.174 million yuan, followed by Jiangsu Huasha Rongchuang Real Estate Development Group Co.,Ltd., Tianjin Jinneng Investment Company, Shanghai Greenland (Group) Co., Ltd., Fujia Group, Tiens Group Co. Ltd and Dalian West Pacific Petro-Chemical Co. Ltd. Around 21.8 percent and 71.7 percent of the Top 500 companies had their per capita profits within the scope of 100,000-500,000 yuan and 0-100,000 yuan, respectively.

Profit margin: Among the Top 500 Companies of China in 2010, the Bank of Beijing Co., Ltd. had the highest profit margin of 47.4 percent. Four companies, Jiangsu Huasha Rongchuang Real Estate Development Group Co.,Ltd., China Guizhou Maotai Distillery Group Co. Ltd, Shanghai Pudong Development Bank and China Merchants Bank (CMB), had a profit margin of more than 30 percent; 13 companies within the scope of 20-30 percent, 38 within 10-20 percent, 422 within 0-10 percent, while 17 had a negative profit margin.

Return on assets (ROA): Compared with the previous year, the Top 500 Companies of China in 2010 had a slightly higher return on assets. On the ranking board, Hangzhou Wahaha Group Co. Ltd took the first position with 30.1 percent, followed by Tianzheng Group Ltd and Shanghai People Enterprise (Group) Co. Ltd with more than 25 percent. All together, 10 companies had a return on assets of more than 20 percent, 35 within the scope of 10-20 percent, 432 within 0-10 percent while 17 had a negative return on assets.

Profit growth rate: Compared with the previous year, the profit growth rose significantly in 2010. Six companies had a profit growth rate of more than 1,000 percent, such as Beijing Energy Investment Holding Co., Ltd., China Telecom Corp. Ltd. (China Telecom), Shanghai Automotive Industry Corporation (Group), Ping An Insurance (Group) Company of China, Henan Yulian Energy Group Co. Ltd and Kailuan (Group) Co. Ltd. 88 companies had a profit growth rate within the scope of 100-1,000 percent and 278 within 0-100 percent, while 123 had negative growth in profits, apparently better than the previous year which saw 240 companies with negative growth in profits. As for the other five companies, the data is unknown. For more details, please refer to Table 1-6.

Table 1-6. Comparison of profit growth rate in 2009 and 2010

 

Asset turnover is an important indicator to measure how effectively a business is using its assets to generate sales. Compared with the previous year, the number of companies whose asset turnover surpassed 5 times/year decreased in 2010, while the number of companies whose asset turnover was less than 0.5 times/year rose. On the ranking board of asset turnover for the Top 500 Companies of China in 2010, China New Century Holding Group took the first position with 8.95 times/year, followed by Zhangjiagang Free Trade Zone Xinghengde Trading Co., Ltd., Zhuhai Zhen Rong Company and Shandong Liuhe Group Co. Ltd with more than 7 times/year. For more details, please refer to Table 1-7. 

 

 Table 1-7. Asset turnover of the Top 500 Companies of China in 2010

 

 

Return on net assets (RONA) is the most comprehensive indicator to measure financial performance of a company. For the Top 500 Companies of China in 2010, the average return on net assets was 9.39 percent. Two companies had a return on net assets of more than 100 percent, i.e., Jiangsu New Century Shipbuilding Co. Ltd with 182.2 percent and Jiangsu Xicheng Sanlian Holding Group Co. Ltd with 153.8 percent. However, 94.9 percent of the Top 500 companies had a return on their net assets within the scope of 0-50 percent. For more details, please refer to Table 1-8. 

 

Table 1-8. Return on net assets (RONA) & capital maintenance and appreciation rate of the Top 500 Companies of China in 2010

 

 

For the Top 500 Companies of China in 2010, the average capital maintenance and appreciation rate was 116.4 percent. Dalian Wanda Group Co., Ltd. was the only company whose capital maintenance and appreciation rate surpassed 500 percent, ranking first with 841.14 percent. 92.7 percent of the Top 500 companies had capital maintenance and appreciation rates within the scope of 100~500 percent. For more details, please refer to Table 1-8.

The Top 500 companies in China, and the Fortune Global 500 companies, are all ranked by their gross revenue. However high revenues do not indicate that the company gained higher profits, created better economic benefits, or operated and managed assets well. Revenues are only a reference to a company’s development scale and level. In other words, as is implied by the data above, companies with good economic benefits are not necessarily ranked at the top of the revenue list.

3. Reasons why the economic benefits of the Top 500 Companies of China in 2010 change

Compared with the previous year, the economic benefits of the Top 500 Companies of China in 2010 have greatly improved and their profit growth rates have also risen significantly. However, some companies, such as companies invested in the railway industry, have suffered losses.

External environment: As China further implements the 4-trillion yuan stimulus package and sustains a proactive fiscal policy and a moderately loose monetary policy, its domestic consumption has been boosted. In 2009, new RMB and foreign currency loans from Chinese financial institutions reached 9.4 trillion yuan，about twice as much as those in 2008. These funds largely flowed into the projects for construction of railway lines, roads and infrastructure. The loans were mostly used in a minority of industries such as resources, heavy industry and real estate, which just occupy the largest proportion to the Top 500 Companies of China. In a word, these companies now have a more relaxed and optimistic external development environment than in 2008, when the financial crisis erupted and spread globally.

For this year's Top 500 Companies of China, average assets increased by 23.03 percent, far more than the 6.19 percent increase of revenue. This result is partly due to the national investment, and partly due to the fact that mergers and reorganization of companies are increasingly promoted. Compared with the previous year, their overall profit growth rate, the return on net assets and the capital maintenance and appreciation rate increased greatly in 2010. Meanwhile, more profits were gained, since the purchase prices of raw materials, fuel and power fell by 7.9 percent through the year of 2009.

Summary	Report on Top 500 Companies of China in 2010
Chapter I.	Generation and Features
Chapter II.	Scale Features
Chapter IV.	Industrial Analysis
Chapter V.	Regional Distribution
Chapter VI.	Ownership Distribution
Chapter VII.	R&D Expenditure
Chapter VIII.	Ranking Changes on Top 500 List
Chapter IX.	Other Features
Chapter X.	Progress and Achievements of Large Companies
Chapter XI.	Major Problems of Large Companies