Haier Says First-Half Net Down Due to SARS
Aug 25, 2003
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Chinese appliance maker Qingdao Haier Co. said over the weekend its net profit for the first half of the year fell 13 percent due to the impact of the SARS outbreak and an ongoing price war.

The company said net profit fell to CNY189.8 million (approx. U.S. $23 million) in the 6 months ended June 30 from CNY219.2 million a year ago.

Core revenue rose slightly to CNY6.31 billion from CNY6.26 billion last year.

Sales of refrigerator units declined 9.5 percent to CNY1.73 billion, while air-conditioner sales dropped 2.4 percent to CNY3.59 billion.

Qingdao Haier said the launch of new air-conditioner and refrigerator products somewhat softened the blow of the severe acute respiratory syndrome (SARS) outbreak in the second quarter that caused people to avoid crowded places, such as department stores, to keep from catching the illness.

The price war in the domestic appliances market, primarily brought about by a supply glut, has also affected its net profit.

Domestic sales for both products slipped 0.1 percent to CNY5.37 billion, while overseas sales rose 6.5 percent to CNY938.6 million.

The company manufactured 1.7 million refrigerators and 2.03 million air-conditioners during the period, with exports totaling 875,200 and 929,900 units, respectively. (Dow Jones)

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