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But its sales fell 16 percent as market share for its road rollers and spreading machines declined as it failed to benefit as much as its competitors from investments in factories and other fixed assets in the country.

Xugong Science, the Shenzhen listed unit of China's largest construction equipment maker Xugong Group Construction Machinery Co, reported net profit of 9.6 million yuan last year on sales of 2.58 billion yuan, from a loss of 129 million yuan in 2005, to the Shenzhen Stock Exchange.

The turnaround was mainly due to cutting of jobs and restructuring of its organization, the company said in a statement.

Shares of Xugong Science fell 5.52 percent to close at 13.7 yuan yesterday.

Xugong Science, the No. 1 road roller and spreading machine maker in China, saw its market share of road rollers tumble from 41 percent in 2005 to 31 percent last year while the share of its spreading machines fell from 37 percent to 22 percent, as competition in the industry intensified, according to the China Construction Machinery Association.

Meanwhile, Sany Heavy Industry Co, China's biggest maker of concrete pumps, more than doubled profit in 2006 amid surging demand for its equipment. Xugong Science said it would continue to cut jobs this year and boost its production capacity. It expects sales this year to rise 16 percent to three billion yuan.

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