Chinese heavy machinery maker Sany Heavy Industry Co reported a more than 300 percent jump in its first-quarter net profits on Thursday. It did not give an explanation for the spike but said one of its subsidiaries took control of two firms in January. Company executives could not immediately be reached for comment.
Sany said it made a net profit of 90.2 million yuan ($13.93 million) in the first three monts of the year, up from 20.6 million in the same period last year. Annual earnings were down 80.5 percent last year at 138.6 million yuan. Heavy equipment makers in China are struggling with unsold product, idle factories and tumbling earnings in a severe market downturn following years of strong growth after Beijing launched a $644 billion stimulus package in 2008.
Rival Zoomlion Heavy Industry Science and Technology Co reported a record quarterly loss earlier this month. Sany has opened a bank, detailed plans for a weapons-making unit and even called upon employees to buy company shares, in efforts to counter the downturn. Amid the slump, the company has lost about half of its market value in the last 12 months and now has a market capitalisation of about $6.4 billion.
As part of its efforts to tackle falling earnings it has also invested aggressively overseas, announcing last October it would invest $3 billion to develop 2,000 MW of renewable energy projects in India. Sales outside China contributed 44.2 percent of its overall sales in 2015, compared with 32.3 percent in 2014 and 6.5 percent in 2010, according to company data.
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