November 30, 2017 / 9:27 AM / a year ago

China's GOME posts 11 pct fall in 9-month profit on higher finance costs

HONG KONG, Nov 30 (Reuters) - GOME Retail Holdings Ltd on Thursday said its nine-month net profit fell 10.7 percent due to higher finance costs as borrowings increased, offsetting a rise in sales on improved consumer sentiment.

The home appliances retailer, which has a market value of $2.5 billion, said net profit fell to 220.1 million yuan ($33.30 million) for the January-September period, from 246.5 million yuan a year ago.

Finance costs increased to 466.56 million yuan for nine months ended in September, from 166.56 million yuan in a year-ago period.

Revenue for the period climbed 3.7 percent to 57.43 billion yuan. Consolidated gross profit margin increased to 17.05 percent from 16.02 percent.

Gross merchandise volume for both online and offline grew 20.04 percent during the Jan-Sept period, against 24.75 percent growth a year earlier. Of that, GOME’s online e-commerce business grew 58.13 percent, compared to 106.17 percent growth a year ago.

In October, bigger rival Suning Commerce Group said its nine-month profit soared 321 percent to 671.7 million yuan as sales jumped on improving consumer sentiment.

GOME shares fell 2.2 percent before results. ($1 = 6.6100 Chinese yuan renminbi) (Reporting by Donny Kwok; Editing by Vyas Mohan)

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