Foreign exchange earnings a solo show China's first half of grain holding profit increased 30%

Cofco Holdings (00606. HK) is one of the largest edible oil production companies in China, with a total workforce of nearly 30,000, and dozens of large-scale factories across the country. In the first half of this year, Cofco has achieved a pre-tax profit of HK $1.164 billion, and it is noteworthy that about half of it comes from exchange gains from a stronger renminbi.　　In fact, Cofco is not the only company in the edible oil business that uses financial operations. The group's earnings of HK $40.234 billion were down 3.4% in the first half of the year, but pre-tax profits of HK $1.164 billion, up about 76% from a year earlier, compared with 663 million Hong Kong dollars in the same period, the report showed yesterday. The interest holders of the company increased by 31.5% to HK $659.7 million over the same period in 2012, with a basic profit of 12.57 cents per share.　　The board announced an interim dividend of 3.1 cents per share. Behind the bright earnings, Cofco's main business performance is not so satisfactory. Oil seed processing is the main business of Cofco, contributing 58% of the total revenue.　　In the first half of this year, sales of vegetable oil in Cofco increased by a slight increase of 8% to 1.486 million tonnes, but the sales of oilseed meal fell by 40.4% to 1.891 million tonnes a year, and with the fall in vegetable oil prices, the revenue fell by 10.3% to HK $23.3459 billion in Year-on-year. Despite the general performance of the main business, the other income and earnings of COFCO have achieved HK $932 million, up 74.1% from the 535.4 million Hong Kong dollar in the same period last year, and the rise was mainly attributable to a substantial increase in foreign currency liabilities arising from the revaluation of the renminbi during the period.　　Earnings showed that in the first half of this year, the net gain in foreign exchange gains amounted to HK $525 million, which was blank last year, which accounted for about 45% of the pre-tax profit of Cofco in the first half of this year and the "half of the total" contribution of the exchange earnings.　　A large edible oil production enterprises in charge of the first financial daily reporter said, because of domestic overcapacity, edible oil processing profit margins fell to Single-digit, if the enterprise only do industry, will be unsustainable, through financial operations to obtain financial income becomes the important factor that determines the survival of enterprises. Dongling Grain and oil (000893, Stock bar) (000893). SZ) prior to the release of the semi-annual report, the first half of this year, the east to achieve the main business revenue 4.895 billion yuan, the same period last year increased 30.53%; The net profit attributable to the owner of the parent company was 30.2763 million yuan, an increase of 816.45% per cent.　　The main reason for the company's net profit surge is that the company has strengthened its inventory management faster inventory turnover, inventory turnover than the same period last year, the other important reason is to improve the efficiency of the use of funds and revenue, thereby reducing operating costs, capital operations, the income relative to the same period last year increased significantly. Dongling grain and oil so-called increase the efficiency of the use of funds is the most outstanding performance is also exchange earnings, the first half of this year, East Ling Grain and oil received exchange earnings reached 62445,500 Yuan, a loss of $15.8198 million in the same period last year.　　At present, the edible oil production enterprise obtains the exchange income the financial means many, one of them is the renminbi pledge dollar loan, the enterprise will the renminbi deposit pledge in the bank, obtains the US dollar loan, after a period of time, because the renminbi appreciates, the enterprise can return the dollar to the bank, earns the exchange rate fluctuation But the renminbi is not always appreciating, and fluctuations in exchange earnings often occur.　　The net exchange gain of COFCO in 2012 was HK $106 million, which fell by about 90% Year-on-year compared with the 1.082 billion Hong Kong dollar in the same period in 2011, which dragged down the profit level of Cofco, which was "Chengye and Shenya". (Edit: Goofy)