September 8, 2010

China's top four dairy producers post 17% rise in H1 sales

Four top public dairy product makers in China raked in more than RMB34.7 billion (US$5.11 billion) operating revenue in the first half of the year, leaping by 17% compared with US$29.7 billion gained in the period of last year.

On the heels of Bright Dairy & Food, Inner Mongolia Yili Industrial Group and Beijing Sanyuan Foods, China Mengniu Dairy Company Limited also released interim results last week, reporting RMB14.434 billion (US$2.12 billion) operating income, hiking by 19.31% over a year earlier.

Mengniu Dairy racked up RMB618.8 million (US$91.1 million) in net profit in the first six months, the highest in the sector, thanks to boosting factors like Chinese dairy product market expansion and dairy product structure optimisation.

The company recorded the fattest earnings versus peers but it incurred a decline of 6.5% on-year. The company responds that the gross profit shrink was resulted from continued markup of raw materials and increasingly rising cost pressures. It is a knot that players of the sector cannot untie easily.