China Hongqiao Group Limited reported a 27.5% loss in profits for H1 2014

China Hongqiao Group Limited filed its interim report for the first half of 2014 at the Hong Kong Exchanges and Clearing Limited, reporting 27.5% YOY fall in net profits to 2.04 billion yuan ($0.33 billion) due to falling price of aluminium products.

The prime cause behind this decline in net profits is accounted to the drop in the average price of aluminium products, from 12,354 yuan per tonne in H1 2013 to 11,184 yuan per tonne (VAT tax excluded) in H1 2014.

However, due to growing demand in the industry, the revenues of the company have risen by 28.6% in H1 2014 up to 17.37 billion yuan. The company had to subsequently increase its aluminium products capacity by 27.7% going up to 3.14 million tonnes this H1 compared to 2.46 million tonnes of last year’s H1.

China Hongqiao will continue its agenda of vertical expansion in terms of internal power plant constructions and fabricating business. They have also begun construction of the first phase of their alumina JV project in Indonesia which is due to enter service by late 2015. They even have plans to acquire a 2.2 billion tonnes worth bauxite mine in Geneva.