Jiangxi Copper posts fastest annual net profit growth in 7 years
BEIJING, March 28 (Reuters) – Jiangxi Copper Co Ltd, one of China's biggest copper smelters, said on Wednesday its 2017 net profit more than doubled, growing at the fastest pace in seven years, mainly due to higher copper prices.
The Nanchang-based company also aims to increase its copper output in 2018, though it will be monitoring the market due to the country's expected slower growth in key infrastructure sectors and rising inventories.
Jiangxi Copper's net profit for 2017 came in at 1.60 billion yuan ($254.34 million), up 104.6 percent from a revised 784.1 million yuan a year earlier, it said in a filing on the Shanghai stock exchange. Fourth-quarter profit came in at 23.4 million yuan, versus a loss of 201 million yuan a year ago.
"We expect copper prices to hover around highs in 2018 due to domestic property and infrastructure sectors experiencing easing growth, monetary policy remaining relatively tight and rising copper inventories
The 2017 growth marked the strongest pace since 2010, when net profit was up by 109 percent. In January, it had said it expected its 2017 net profit to rise 100-130 percent.
Revenues were up 1.35 percent to 205 billion yuan in 2017, Jiangxi Copper said.
Apart from rising metal prices, with the benchmark three-month copper prices on the London Metal Exchange climbing by over 30 percent in 2017, non-recurring items and provisions of assets impairment helped boost net profit, it said.
"We expect copper prices to hover around highs in 2018 due to domestic property and infrastructure sectors experiencing easing growth, monetary policy remaining relatively tight and rising copper inventories," it said.
Jiangxi Copper set its output for copper cathode at 1.42 million tonnes this year, up from 1.37 million tonnes in 2017, it said in its earnings report.
The results announcement comes as Jiangxi Copper and nine other Chinese smelters are due to meet in Shanghai on Friday to set their floor treatment and refining charges (TC/RCs) for copper concentrate in the second quarter.
Miners pay TC/RCs to the smelters to process their ore.
The first-quarter TC floor was set at $87 per tonne, while the RC floor was 8.7 cents per pound..
($1 = 6.2908 Chinese yuan renminbi) (Reporting by Tom Daly in Beijing and Lee Chyen Yee in Singapore; Editing by Adrian Croft)