(Updates adding writedown, futures in fifth paragraph.)
Oct. 25 (Bloomberg) -- Jiangxi Copper Co., China’s biggest producer of the metal, said third-quarter profit fell 2.8 percent because of higher taxes, a drop in inventory value and a paper loss from futures trading.
Net income dropped to 1.24 billion yuan ($195 million), or 0.37 yuan a share, from 1.28 billion yuan, or 0.42 yuan, a year earlier, the company said today in a statement to the Shanghai stock exchange. Sales rose 56 percent to 30.6 billion yuan from 19.6 billion yuan.
Copper prices in London have fallen about 34 percent from a record in February amid concerns a global economic slowdown may curb demand. Contracts for three-month delivery were down 0.4 percent to $7,605 a ton at 9:10 p.m. Shanghai time.
Still, the average price gained 27 percent to $9,013.7 a ton in the third quarter from a year earlier. Global production is set to fall short of demand by 201,000 metric tons this year, according to the International Copper Study Group.
Jiangxi Copper wrote off 689 million yuan for losses incurred for its inventory in the third quarter, and operating taxes surged 67 percent to 125.6 million yuan, the statement said. It also had a paper loss in futures trading as copper prices tumbled in late September, it said.
Jiangxi Copper advanced 0.6 percent to HK$17.02 today in Hong Kong trading today, before the earnings announcement, lagging behind a 1.1 percent gain in the benchmark Hang Seng Index.
Copper stockpiles monitored by the Shanghai Futures Exchange fell by 11,935 metric tons last week to 87,726 tons, the lowest since the week ended June 24, according to a survey of 10 warehouses in Shanghai, the bourse reported on its website.
--Helen Yuan, with assistance from Chua Baizhen in Beijing. Editor: Joshua Fellman
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