Employees of Sany Heavy Industry Co at a workshop in Shenyang, Liaoning province. (Zhang Wenkui/for China Daily)
Sany Heavy Industry Co, one of China's top three construction machinery manufacturers by production volume, reported on Tuesday night that its sales revenue was up 71.2 percent year-on-year to 19.2 billion yuan (.9 billion) in the first half of this year.
The revenue surge was largely pushed by the development of the Belt and Road Initiative and growing demand in the domestic market for next-generation construction machinery such as excavators, bulldozers, pipe-layers, road rollers and wheel loaders since the second half of 2016.
The company's first-half fiscal report said that Sany has gained steady momentum in the past six months. Its net profit topped 1.1 billion yuan, up a staggering 740.9 percent year-on-year. The group's assets had reached 59.52 billion yuan by the end of June.
Yin Xiaoli, deputy secretary-general of the Beijing-based China Construction Machinery Association, said many of the opportunities (from the initiative) were raised due to the surging demand for public services, manufacturing and infrastructure projects in economies taking part in the initiative, especially in fast-growing economies such as Turkey, Poland and Saudi Arabia.
Sany remains the world's biggest concrete mixer manufacturer and this product garnered sales totaling 6.6 billion yuan between January and June. The company also generated revenue of 6.9 billion yuan from excavators, which has made the group China's top seller of excavators for seven consecutive years. Sany now occupies one-fifth of the market.
In the meantime, sales of excavators, pilling machines and cranes have soared by 102.4 percent, 226.4 percent and 69.8 percent year-on-year, respectively.
The report also noted a strong uptick in the group's global business, as international sales jumped 25.9 percent year-on-year, totaling 5.8 billion yuan in the first half.
Firms in the construction machinery industry "will continue to benefit from the Belt and Road Initiative, and Sany is one of them", said Duan Dawei, chief financial officer of Sany. "The growing number of infrastructure projects, including roads, railways, airports and ports, will increase the need for construction equipment, and the growing trade activities in this segment will also boost shipments of high-end equipment."
Despite the steady growth, Sany's first-half performance failed to meet expectations, as the profits from second quarter did not catch up with the figure of 700 million yuan in the first quarter.
That has led to a sharp drop of its stock price on Wednesday after the report was released. The group explained that one major reason was due to the rising renminbi and that the group's income generated abroad was mainly cashed in US dollars.
He Dongdong, Sany's senior vice-president, said the group's next step is to accelerate its progress in artificial intelligence technology development, as it can connect all its products with a cloud data platform to boost work efficiency.
"Traditional manufacturing business like construction machinery is falling behind in making itself digital," He said. "Sany is wasting no time in digitalization."