BEIJING, March 23 (Reuters) - Aluminum extruder China Zhongwang Holdings Ltd’s net profit hit its highest in at least five years in the fourth quarter as the company ramped up sales of new products for the transportation sector.
Zhongwang’s net income for September-December 2017 came in at 1.524 billion yuan ($241.12 million), according to Reuters calculations.
That is more than three times the 468 million yuan profit made a year earlier and beats Zhongwang’s 1.08 billion yuan profit for the third quarter, which was itself the best result in Reuters’ records going back five years.
Annual profit rose by 33.1 percent to 3.87 billion yuan, Zhongwang said, while full-year revenues jumped 16.6 percent to 19.46 billion yuan thanks to higher average sales prices.
“The group developed and launched large-sectional aluminium parts for passenger cars and commercial vehicles, which received positive market feedback,” Zhongwang said in a statement.
The company has “been expanding its business into the sectors of new energy vehicles and rail transportation,” it said, adding it had been supplying deep-processed aluminium products for high-speed trains.
Revenues in the deep-processing business took a hit, however, falling by 70.4 percent over the year in 2017.
This was “mainly due to the declined export volume of deep-processed products to the United States ... as trade friction in aluminium industry between the US and China heated up,” it added.
Zhongwang’s former chairman, Liu Zhongtian, who stepped down in November, has been accused of smuggling by the U.S. Department of Justice and dropped his bid to acquire extrusion firm Aleris Corp last year after failing to win U.S. government approval. Liu denied the allegations.
As well as U.S. trade action on Chinese aluminium foil and alloy sheet, President Donald Trump has imposed a 10 percent tariff on aluminium imports effective from Friday, which China opposes.
$1 = 6.3204 Chinese yuan renminbi Reporting by Tom Daly; Editing by Mark Potter