August 29, 2017 / 12:43 AM / a year ago

China's GOME's H1 net profit falls 1.6 pct as finance costs rise

HONG KONG, Aug 29 (Reuters) - GOME Retail Holdings Ltd , formerly known as Electrical Appliances Holding Ltd, said late on Monday its first-half net profit fell 1.6 percent due to a rise in finance costs as its borrowings increased.

The retail chain said total borrowings, including bonds payable and interest-bearing bank loans, rose to 16 billion yuan ($2.4 billion) as of the end of June, up from 6.41 billion yuan at the same time last year. Finance costs rose to 323 million yuan from 105 million yuan.

The home appliances retailer, which has a market value of $2.6 billion, said net profit dipped to 122 million yuan ($18.5 million) for the January-June period, from 124 million yuan a year ago.

Sales revenue for the period rose 7.8 percent to 38.07 billion yuan, from 35.3 billion yuan. Consolidated gross profit margin increased to 17.83 percent from 16.37 percent.

Last month, bigger rival Suning Commerce Group saw its first half results return to a profit of 291.7 million yuan, from a 121.2 million yuan loss a year earlier.

GOME shares rose 1.1 percent ahead of the results statement, outpacing a 0.1 percent rise in the benchmark index. ($1 = 6.6084 Chinese yuan renminbi) (Reporting by Donny Kwok; Editing by Richard Pullin)

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