Fuyao Glass posts profit drop in H1

Updated 2017-08-05 16:05:29 Xinhua

Automobile and industrial glass maker Fuyao Glass Industry Group Co., Ltd, reported lower profits in H1 due to a huge exchange loss from appreciation of the yuan.

Profits declined 5.2 percent year on year to 1.69 billion yuan (around 250 million U.S. dollars) in the January-June period, in contrast with a gain of nearly 35 percent in the same period of 2016.

In a mid-year report, Fuyao Glass attributed the drop to a stronger yuan, citing losses of more than 171 million yuan through exchange rate changes. The company saw an exchange gain of around 200 million yuan a year ago.

Excluding that factor, the profits would have grown 17.9 percent, the company said.

The yuan rose by 2.34 percent during the first half of the year,resulting in rising costs for exporters. Around 35 percent of Fuyao's revenue comes from overseas.

Fuyao's revenue increased 14.9 percent in the first six months and its net profit fell 4.8 percent. The earnings per share were down 5.2 percent.

The company spent 1 billion U.S. dollars on factories in the United States, including a former General Motors plant in Moraine, Ohio, which will employ 2,500 people.

Overseas revenue grew by 17.8 percent, outpacing the 11.8 percent increase at home.

The company expects challenges from a complicated broader economy and slowing sales growth of automobiles, as well as exchange rate risk, and therefore will step up research and development and optimize management.

Fuyao Glass shares fell 1.04 percent to 22.83 yuan in Shanghai Friday.

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