Forbes Jan 23---Aluminum producers maker China Zhongwang, no stranger to trouble since its listing in Hong Kong in 2009, added this for investors on Friday night: A warning that profits for last year are expected to tank.
The Chinese company led by billionaire Liu Zhongtian said in a statement at the Hong Kong Stock Exchange that net profit for the year ended Dec. 31 is expected to decline by more than 25% from a year earlier, based on a preliminary, unaudited estimate.
Profit was hurt because of uncertainties in connection with an anti-dumping and countervailing duties investigation underway in the U.S. on certain aluminum extrusion products exported from China, the company said. Zhongwang’s exports to the U.S. last year were lower than a year earlier, the statement said.
Profits was additionally harmed by lower sales of construction aluminum extrusion products as the company refocused its business on industrial aluminum extrusion items. China Zhongwang may provision for machinery and equipment used to make construction products, the company said.
Zhongwang has been in the news over questions about the accuracy of information in its 2009 listing prospectus and for a loan provided by the company.
The stock has plunged more than 40% in the past year. Investors that bought that IPO at about HK$7 per share have lost money: last week’s close was HK$4.20.
China’s aluminum market still holds promise and attracts investment. Alcoa, the biggest U.S. aluminum maker, said last week it would team up with China Power Investment on clean-tech projects.
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