Sinovel suffers 73 pct plunge in 2011 net profit
Shanghai. April 12 INTERFAX-CHINA - Sinovel Wind Group Co. Ltd., China's leading wind turbine manufacturer, saw net profit in 2011 plunge by 72.84 percent year-on-year to RMB 775.72 million ($123.13 million), according to the company's annual report released on April 11.
Sinovel's sales revenue shrank by 48.66 percent over the same period to RMB 10.44 billion ($1.66 billion). The Shanghai Stock Exchange-listed company attributed the declines to intensifying market competition, China's slowing economic growth, and tightened lending conditions imposed by Beijing.
Shares of Sinovel closed at RMB 16.06 ($2.55) on April 12, down by 0.25 percent from the previous trading day.
Sinovel's production of wind turbines last year was equivalent to 2.94 million kilowatts (kW) of installed capacity, with output mainly comprised of 1.5 megawatt (MW) and 3 MW turbines.
"Sinovel's poor performance last year reflected the declining profitability of China's wind turbine manufacturing industry. With over 70 turbine makers in China, oversupply has seriously dragged down the profit margin of these firms. An industry consolidation is badly needed to help the profitability of turbine makers return to healthy levels," renewable energy industry expert Li Lei in Jiangsu Province's Lianyungang City told Interfax.
Goldwind Science and Technology Co. Ltd., Sinovel's main domestic rival, also reported sluggish earnings for 2011. The company said in March that sales fell 27.01 percent year-on-year to RMB 12.84 billion ($2.04 billion) in 2011, while net profit plummeted by 73.50 percent over the same period to RMB 606.71 million ($96.30 million).
--WV
