Sinochem International Co Ltd, the Shanghai-listed arm of China's largest chemicals trader Sinochem Group, reported yesterday a 365 per cent increase in its combined net profit during the first half of the year, as China's appetite for raw materials continues to rise.

The net profit stood at 484 million yuan (US$58.5 million), compared with 104 million yuan (US$12.6 million) a year earlier, reported China Daily Wednesday.

The increase came against the slight drop in the company's revenue from 5.79 billion yuan (US$700 million) to 5.49 billion yuan (US$664 million) and was largely a result of a rising profit rate in its staple business.

From January to June, the profit rate increased by 10.46 percentage points compared with same period last year, said the company in its half-year report.

Coking coal, iron ore and fertilizer business are its most profitable, it said.

Analysts say Sinochem International is benefiting from China's blistering economy and foreign trade.

The nation, registering a 9.7 gross domestic product growth in the first half of the year, needs a great deal of raw materials such as rubber, metals and plastics to fuel its economy.

Meanwhile, the company also revved up efforts to develop more profit engines, reducing exposure on the trading sector that is subject to cutthroat competition.

Shipping, storage and logistics businesses have already made profit for the company.

Encouraged by current gains, Sinochem International has spoken optimistically of its performance in the months to come.

"Our business will steadily expand due to the good macroeconomics climate, and the third-quarter net profit will surge dramatically compared to the same period in 2003," the company said.

Source: China Daily