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Profit drops in China firms

Monday, April 03, 2017 - 01:11

Official numbers may suggest a rosier 2017 for China, but the bottom lines of the country's top consumer firms paint a patchy picture of spending in the world's second-largest economy. Ryan Brooks reports.

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Call it a case of consumer anxiety in China. While official numbers paint a pretty picture for the economy in 2017, the bottom lines of the country's big brands tell a different story. Many have reported profit drops in the past week. Tsingtao, China's second-largest beer brewer posted its steepest earnings fall in 20 years. And Wanda Cinema - which owns AMC - saw its once-rosy profit growth tumble. SOUNDBITE (English) CITY INDEX MARKET ANALYST, KEN ODELUGA, SAYING: "We're starting to see the limits of the internal demand, I would say, for a lot of the products that have actually brought about this big rebound in growth." Beer, movies, even noodles. Analysts also say China's consumer sectors are overloaded with competition, and if brands want to survive they must spend more to stand out. But according to experts, politics abroad have Chinese keeping their wallets shut, too. As Beijing tries to kick-start a more domestic-focussed economy. Keeping people spending money on home-brand goods is more important that ever. But so far, 2017 looks patchy at best.

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Profit drops in China firms

Monday, April 03, 2017 - 01:11