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Sinopec Gains Rights to Devon's Oil Blocks
Devon Energy Corp (NYSE: DVN) helped Sinopec Corp (NYSE: SNP, SHA: 600028, HKG: 0386) strike a $2.5 billion deal to explore North American shale gas resources, according to Devon Energy chief executive John Richels. The deal, in which Sinopec obtained rights to one-third of Devon's 1.4-million-acre oil blocks, was signed in January, Richels said.
Nepstar Net Profit Surges 118%
China Nepstar Chain Drugstore Ltd (NYSE: NPD), China's largest retail drugstore chain, posted $395.8 million in revenues and $5.7 million in net profits in 2011, up 5.7% and 117.6% respectively from the year before. CEO Zhang Fuxiang said the efforts to optimize product offerings enabled the company to balance the adverse effects of contracting gross margins caused by government mandated pricing controls on pharmaceuticals and increasing labor and rental costs.
Higher Costs Harm Gome's Profits
Gome Electrical Appliances Holding Ltd (HKG: 0493), China's second largest chain store by revenue, posted ¥59.82 billion in revenues and ¥1.84 billion in net profits for 2011, up 17.5% and down 6.2% respectively from the year before. Higher operating and administrative expenses, which shot up 35% last year, were blamed for the decline in earnings. Gome was operating 1,079 stores as of the end of 2011, up from 826 a year earlier.
Air China Posts Sharper-Than-Expected Profit Drop
Air China Ltd (SHA: 601111, HKG: 0753), the nation's third biggest carrier by passenger traffic, reported a 38.8% decline in net profit, to ¥7.48 billion, last year as a result of higher fuel prices, which rose 44% to ¥33.79 billion, and an unexpected impairment charge of ¥1.14 billion in Q4 2011. Its net profit fell short of the ¥9.2 billion the market had expected. Its revenue was up 20% to ¥97.14 billion.
China Coal Net Profit Up 31%
China Coal Energy Co (HKG: 1898), the nation's second largest coal producer by revenue, posted ¥87.77 billion in revenues and ¥9.8 billion in net profits for 2011, up 25% and 31% respectively from the year before as domestic demand for coal increased. The company's coal output grew 9% to 102.79 million tons last year.
Strong Sales Push Up Jiangxi Copper's Profit
Jiangxi Copper Co (SHA: 600362, HKG: 0358), China's biggest copper producer, posted ¥117.64 billion in revenues and ¥6.55 billion in net profits for 2011, up 54% and 33% respectively from the year before. The company said strong sales offset a 20% fall in copper prices in 2H 2011.
Costlier Raw Materials Erode Angang Steel Margins
Angang Steel Co (SHE: 000898, HKG: 0347), China's third biggest steelmaker by output, said it recorded a ¥2.15 billion loss in 2011 as a slowdown in the property market and rising raw material costs weighed on profitability. It posted a ¥2.04 billion net profit in 2010.
$1 = ¥6.3
@2011 China Economy @ The China Perspective.
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