NEWS BRIEFS
Fastener Manufacturer Wins Speed Rail Contract
China fastener manufacturer Gem-Year Industrial Co. Ltd. said it won a CNY 240 million contract to supply high-speed rail fasteners and components, MENAFN reports.
Gem-Year reportedly received notice from Guiyang-Guangzhou Railway Co., which is building a new railway between Guiyang and Guangzhou, China.
In August Gem-Year Industrial cut its profit forecast by 50% for the first three quarters of 2011 due to uncertainties in the high-speed railway parts market. The firm said high-speed train accidents happen frequently and have affected related parts biddings and existing contracts settlements.
In the first half, Gem-Year’s net profit fell 12.05% to 105 million yuan despite 21% revenue growth to 1.54 billion yuan. First-half fastener revenue rose 24.77% to 443.73 million yuan, while revenue from high-speed railway parts slipped 7.29% to 485.25 million yuan.
Higher labor, material and energy costs also cut into earnings.
Gem-Year’s orders for high-speed rail fasteners topped RMB$1.9 billion (US$285 million) in 2010, according to the China Railway Department.
The construction of high-speed rails is expanding in China. By 2015, the length of high-speed rails in the country will reach 16,000 meters and grow to 24,000 meters by 2020. ©2011 GlobalFastenerNews.com
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