Refrigerator and air-conditioner manufacturer Hualing Holdings has continued to give the shivers as it extended its profit slide since listing on the stock market in December 1993. The company yesterday announced a 65 per cent tumble in net profit for the June half to $16.35 million, hit by sluggish market sentiment and losses at associated companies. Despite the disappointing results, the company resolved to raise $152 million through a rights issue of 200 million shares to finance its refrigerator compressor production joint venture with Xian Dongfang Machinery Factory. Shareholders can subscribe for one rights share for every three shares held at 76 cents. Company chairman Bi Qing said: 'The half-year results were characterised by continuous adverse impact of the China macroeconomic austerity programme, unanticipated natural disasters in several provinces and a continuous sluggish electrical appliance market in China.' Under the spell of consumption gloom, the company was not able to increase product prices while extra costs were incurred in greater marketing efforts. Although market sentiment improved on expectations of relaxation of China's tight credit policy, it did not last long and forced the company to slash production volume, Mr Bi said. The company produced about 189,000 refrigerators in the six months, down 7 per cent from the same period last year. Turnover slid 2.7 per cent to $623.8 million while operating profit decreased 42.6 per cent to $26.52 million. Earnings per share fell 65 per cent to 2.7 cents. The company did not recommend any interim dividend. It paid one cent a share in the year-ago period. Hualing's 44 per cent-owned Guangzhou Mitsubishi Electric Hualing Compressors Co incurred a loss of $3.9 million during its start-up and the loss was expected to widen in the second half. The loss was partly compensated by a rebate of $3 million under a tax relief policy in China. Mr Bi said the operating results for its air-conditioner factory continued to improve because of the increase in domestic components content to 70 per cent from 50 per cent. Production of air-conditioners shot up 63 per cent to 90,000 units. Hualing's share price edged up two cents, or 2.6 per cent, to close at 76 cents yesterday.