Chinese bus maker Yutong's net profit grows over 25% in first three quarters of 2012

Gasgoo.com (Shanghai October 26) - Zhengzhou-based bus manufacturer Yutong Group announced that its net profits grew 25.78 percent over the first three quarters of the year, Essence Securities reported today. The manufacturer's total business income and net profits for the nine month period totaled 13.31 billion yuan ($2.12b) and 973 million yuan ($154.87m), respectively. After dilution, the manufacturer's earnings per share are estimated at 1.48 yuan ($0.236).

Yutong's sales growth rates by segment have been far above the industry averages. Sales of the manufacturer's large, medium and light buses increased 19.23 percent, 3.14 percent and 36.23 percent over the first three quarters of the year, compared with respective rates of 6.84 percent, 1.22 percent and 3.77 percent for the industry as a whole. School bus sales in particular have helped boost Yutong's performance, with it selling a total of 6,140 units over the three quarter time period. Yutong controls 31.2 percent of the market for school buses in China, while school bus sales account for 17.2 percent of the manufacturer's total sales.

Despite the strong result, several analysts expect Yutong's sales growth to fall back in the fourth quarter. Worth noting is that the manufacturer's bus sales fell 22 percent last month, due primarily to new legislation enforcing stricter safety standards for buses, which consequently led to a rise in prices and decrease in consumer demand. Yutong's gross profits fell .09 percent from the second to third quarters of the year, which many believe was related to increased production costs brought on by the new legislation.