Tongling Third-Quarter Profit Drops on Copper Price

BEIJING, Oct. 30 -- Tongling Nonferrous Metals Group Co., China's second-biggest copper smelter, said third-quarter profit dropped 49 percent because of lower metal prices.

    Net income fell to 165 million yuan ($24 million), or 0.127 yuan a share, from 324 million yuan, or 0.25 yuan a share, the Anhui province-based company said in a statement to the Shenzhen stock exchange. Sales dropped 18 percent to 8.6 billion yuan.

    Copper prices fell 22 percent in the third quarter from a year earlier as the global recession crimped demand from makers of power cables and pipes. China, the world's biggest producer and consumer of copper, is spending 4 trillion yuan to revive economic growth and manufacturing demand.

    Tongling Nonferrous shares dropped 5.6 percent to 17.72 yuan before the announcement. The stock has gained 166 percent this year, compared with the 63 percent gain in the benchmark Shanghai Composite Index.

    Nine-month profit fell to 589 million yuan from 1.06 billion yuan, Tongling Nonferrous said in today's statement.

    Larger producer Jiangxi Copper Co. posted a 46 percent profit drop in the quarter, citing lower prices.

    Copper prices in Shanghai averaged 46,095 yuan a metric ton in the third quarter, compared with 58,945 yuan a year earlier. Prices in London have doubled this year as China imported record amounts of the metal for stockpiling and to fuel its stimulus package.

    (Source: Bloomberg)