But factory gate prices, considered a key barometer of corporate profitability, fell at the steepest clip in more than three years as economic growth ground to a fresh near 30-year low in the third quarter. For January-September, industrial firms earned profits of 4.59 trillion yuan, down 2.1% year-on-year, and worse than the 1.7% reading in the first eight months.
The drop was mainly due to factors such as a decline in the ex-factory price of industrial products and slowdown in sales growth, said Zhu Hong, a senior statistician with the NBS. Profits for state-owned firms slipped 9.6 percent in the first three quarters of the year. The most impacted sector was the oil, coal and other fuel processing industries, where profits fell 53.5 percent in the January-September period.
Profits for the non-ferrous, electrical machinery and equipment manufacturing and alcoholic beverages sectors all bucked the trend though, recording rising profits. US and Chinese trade negotiators are working on nailing down a "Phase 1" trade deal for their presidents to sign next month, as the world's two biggest economies try to end a more than a year-long trade war that has disrupted global trade.
China's economic growth is expected to slow to a near 30-year low of 6.2% this year and cool further to 5.9% in 2020, a Reuters poll showed, underlining the challenges faced by Beijing even as it steps up stimulus amid a bruising Sino-US trade war. Industrial firms' liabilities increased 5.4% from a year earlier to 66.49 trillion yuan at end-September, compared with a 5.0% increase in August.
Private sector profits rose 5.4% in January-September, slowing from 6.5% growth in the first eight months. The data covers companies with more than 20 million yuan in annual revenue from their main operations.