Industrial profits grew rapidly in the first two months, with nearly 60% of industries doubling their profits

　　The latest data released by the National Bureau of Statistics shows that in January and February, industrial enterprises above designated size in China achieved a profit of 1114.01 billion yuan, a year-on-year increase of 1.79 times, an increase of 72.1% compared to January and February 2019, and an average growth of 31.2% over the past two years. Among them, more than 90% of industries saw profit growth, and nearly 60% of industries doubled their profits. The efficiency of industrial enterprises continues to recover rapidly.

　　Multiple factors are driving the rapid growth of industrial profits. "Zhu Hong, a senior statistician at the Industrial Department of the National Bureau of Statistics, analyzed that with the continued effectiveness of coordinating epidemic prevention and control with economic and social development, the growth of industrial production and sales has accelerated, and the recovery of enterprise income and profits has been accelerated, with a significant increase in profitability, under the combined effects of stable recovery of domestic and international market demand, low base during the same period, and" local year-end ".

　　The combination of low base and 'local Chinese New Year' has driven rapid profit growth, "said Zhu Hong. In January and February last year, due to the impact of the epidemic, the profits of industrial enterprises above designated size decreased significantly by 38.3% year-on-year. In the case of a 14.0% year-on-year decline in profits in January and February 2019, the base was further lowered. During this year's Spring Festival, many places advocated for celebrating the festival on site, which significantly extended the working hours of enterprises and improved the situation of employees on duty compared to previous years. In January and February, the average number of workers in industrial enterprises above designated size increased by 3.0% year-on-year, and the employment of enterprises increased, effectively promoting the acceleration of production and efficiency improvement of industrial enterprises.

　　In addition, the accelerated growth of industrial production and sales has led to a significant increase in profits. Since the beginning of the year, market demand has continued to rebound, industrial enterprises have maintained a stable recovery trend, and production and sales have significantly accelerated compared to the same period last year. In January and February, the added value of industrial enterprises above designated size increased by 35.1% year-on-year, with an average two-year growth rate of 8.1%; The operating revenue increased by 45.5% year-on-year, with an average growth rate of 9.4% over the past two years. Industrial production and sales have reached a relatively good level in recent years, creating favorable conditions for improving enterprise efficiency.

　　From an industry perspective, over 90% of industries have seen profit growth, with nearly 60% of industries experiencing a doubling of profits. In January and February, among 41 major industrial sectors, 38 industries saw a year-on-year increase in total profits, with industry growth exceeding 90%. Among them, 24 industries have a profit growth rate exceeding 100%. On average over the past two years, 32 industries have achieved profit growth, with a growth rate of 78.0%.

　　In addition, data shows that cost pressure has significantly eased and profit margins have significantly rebounded. In January and February, the cost per 100 yuan of operating income of industrial enterprises above designated size decreased by 1.16 yuan year-on-year, and the unit cost dropped to a lower level in recent years; The expenses per 100 yuan of operating revenue decreased by 1.38 yuan year-on-year. The decrease in cost and expense levels has expanded the profit margin of enterprises. In January and February, the operating income profit margin of industrial enterprises above designated size was 6.60%, an increase of 3.15 percentage points year-on-year, indicating a significant improvement in profitability.

　　However, Zhu Hong also pointed out that the international situation is still complex and severe, domestic epidemic prevention and control cannot be relaxed, the improvement of various industries' benefits is still unbalanced, and the profits of some consumer goods industries have not yet recovered to the normal level before the epidemic. The foundation for the comprehensive recovery of the industrial economy still needs to be further consolidated.

Source: Economic Reference News