Western Mining Co said yesterday that first-half net profit fell 15.7 percent after zinc prices plunged, and it revised down its full-year production target.
Net income was 720.2 million yuan (US$105 million), or 0.3 yuan per share, in the first six months, down from 854.7 million yuan, or 0.44 yuan, a year earlier, the company said in a filing to the Shanghai Stock Exchange.
"The results were lower than expected, mainly because of a plunge in zinc prices and a rise in production costs," GF Securities analyst Huang Yong said.
Western Mining dipped 0.08 percent to 13.12 yuan after the results.
Turnover rose 80.5 percent to 6.24 billion yuan, with contributions from its smelting and trading businesses, the Xining, Qinghai Province-based company said. But the decline in metal prices lowered its gross profit margins.
Zinc prices in benchmark London trading dropped 36 percent in the first half year on year.
Western Mining said its average sales price of zinc concentrate, which accounts for more than half of its output, fell 50 percent in the reporting period from a year ago. Lead concentrate prices rose 16 percent while copper concentrate prices were flat.
(Shanghai Daily July 31, 2008)
