The combined profits of industrial companies across China fell 1.3 per cent in the first three months of 2012 from a year earlier to 1.04 trillion yuan ($164.92 billion),the National Bureau of Statistics said on Friday. The decline follows a 5.2 per cent drop in the first two months,in line with slowing economic growth momentum. China's economic growth is facing downward pressure as exports slow and domestic demand struggles to pick up the slack,partially due to Beijing's campaign to rein in the property market. The statistics agency attributed the drop to shrinking external demand,rising input costs and a stronger yuan exchange rate. The last period for which China reported a nationwide fall in industrial profit was the first eight months of 2009. It said the ferrous metal and chemical product industries were particularly weak,with profits in the two sectors sinking 83.5 per cent and 23.1 per cent,respectively,in the first quarter. Petroleum refining,coking and nuclear fuel processing recorded losses in January-March,compared with a profit in the same period of 2011,the agency said in a statement on its website. Companies in some other industries fared much better. Power and heating suppliers reported a 28.3 per cent rise in profit while earnings in the oil and natural gas exploitation industry grew 10.6 per cent during the same period. The agency's year-to-date profit figure covers industrial companies with annual revenue above 20 million yuan. The HSBC flash purchasing managers index,the earliest indicator of China's industrial activity,recovered slightly in April from March,although not sufficiently to flag a return to expansionary territory.
