Gree Electric Appliances of Zhuhai : ' Shares Rise Despite Weaker First-Half Forecast

By Martin Mou

Shares of Gree Electric Appliances Inc. of Zhuhai rose Wednesday morning despite the company's projection of a net profit slump for the first half of the year.

Gree's shares were last up 1.2% at CNY59.25.

Gree, one of China's leading air-conditioner manufacturers, said Tuesday it expects its first-half net profit to fall as much as 54% from a year earlier to CNY6.3 billion ($899 million).

Revenue for the January-June period is estimated to be CNY69.5 billion to CNY72.5 billion, compared with CNY98.3 billion a year earlier, it said.

The Chinese company cited lower consumer demand due to the Covid-19 pandemic, as well as its active sales promotions, as the major reasons for the weaker results.

Gree's second-quarter results came below expectations, largely due to soft offline sales and discounts offered for online purchases, Citi said in a note. The bank expects Gree's offline sales to recover in the second quarter, helped by distribution channel reforms.

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