Sany Heavy Industry Co Ltd (600031.SS), China's largest construction gear maker, posted a 43.9 percent drop in net profit in the first quarter, due in part to a significant rise in financing costs.
Sany, which said on Friday it had made 1.57 billion yuan ($254.7 million) in the first three months of the year, had seen its earnings drop 34.3 percent in 2012.
The results were released as Sany's closest rival Zoomlion Heavy Industry Science and Technology Co Ltd (1157.HK) (000157.SZ) reported 591.8 million yuan in net income in January-March, down 72 percent from a year ago, in line with its own estimate of a drop of between 60 and 80 percent.
Zoomlion would have been deep in the red without the help of 3.2 billion yuan in government subsidies received during the period, the stock exchange filing showed.
Sany, which made 1.57 billion yuan in the first three months, more than twice as much as Zoomlion, did not get any government handouts.
Sany and others in the sector suffered a tough 2012 but look set to recover as Beijing's new leadership pours more investment into urban development.
A decline in excavator sales narrowed to 6 percent in March from a year earlier, improving significantly from a 47 percent plunge in January-February, according to analysts at JPMorgan.
(Editing by David Holmes)