China's major industrial firms post rapid profit growth in the first two months of 2018

China's major industrial firms posted rapid profit growth in the first two months of this year, the National Bureau of Statistics said on Tuesday.

Profits of industrial enterprises above a designated size in China gained 16.1 percent year on year from the same two-month period last year to 969 billion yuan (US$ 111 billion),  which was 5.3 percentage points faster than that of December 2017, according to the bureau.

Profits of major state-owned industrial companies surged 29.6 percent year on year to 291.81 billion yuan in January and February.

"The faster growth of industrial production and sales offset the negative influence of the price rollback of industrial products, buoying the profit growth," said bureau statistician He Ping.

He also highlighted the improvements the enterprises made in profitability and capital efficiency. The profit margin of industrial companies in their main businesses rose 0.33 percentage points year on year to 6.1 percent during the two-month period.

Data from the bureau showed that 29 of the 41 industries surveyed posted year-on-year profit growth in the two months.

Profits of industries including coal mining, pharmaceuticals and textiles all grew faster during the two months.

Meanwhile, the leverage ratio in Chinese industrial firms continued so see their debt-asset ratio continue to drop. The debt-asset ratio fell 0.8 percentage points from a year before to 56.3 percent at the end of February.

Lower costs also helped the profit growth. The costs per 100 yuan of revenue fell by 0.33 yuan in the first two months from the same period last year, according to He.

"With the supply-side structural reform being further pushed forward, achievements and effects of deleveraging and cost reduction continued to emerge," He said.

Value-added industrial output rose 7.2 percent yearly in the first two months, from 6.2 percent in December 2017.