GOME Electrical, the mainland's leading electronics and home appliance retailer, posted a 191.1 percent increase in first-half earnings, thanks to a better margin, more stores and financial income.

The retailer raised 24.87 billion yuan in revenue for the first six months since January, up 17.6 percent compared with the same period last year. With stronger gross profit margin that increased by 1.4 percentage points to 16.3 percent, the gross profits for the first half rose 22.3 percent to 2.38 billion yuan.

Chen Xiao, executive director and president of GOME, attributes the strong performance to a booming retail environment with its expansion of store network on the mainland. Selling a mix of new products such as mobile phones, instead of just traditional household products added to a new channel for revenue.

The retailer's net profits jumped to 1.15 billion yuan from 395 million yuan a year earlier. The material first-half growth was also lifted by lowering losses of convertible bonds. The company booked an 11.45 million yuan loss in the first half compared with a 410.6 million yuan loss a year earlier. The financial income has also climbed substantially to 269 million yuan, up 80 percent.

The retailer, which has over 700 outlets in 16 cities, has opened 102 new stores since last year. Together with selling new products, this contributes to a steady growth in revenue. Chen said: "Second-quarter sales increased in nearly all product categories, including audio and video products, IT products and refrigerators."

However, the figures were not as good as Chen expected as the business was hit by natural disasters such as Sichuan earthquake and floods in some southern provinces.

Chen also added: "Sales have been improving in July. During the Olympics we have done some advertising and there is steady growth in sales. I expect a better growth for the second half of the year. We are still optimistic about sales if we do not experience any natural disasters."

Zhou Yafei, the group's chief financial officer, said GOME had initially planned to open 120 stores, but only 102 stores were launched at this point of time and 37 individual stores were closed due to unproductiveness.

The Chinese mainland is the world's largest mobile phone market. GOME is focusing on expanding its mobile phone shops to boost handset sales this year. And with audio-visual products (mainly TV) entering a replacement cycle, Chen expects it will account for 31.7 percent of GOME's total sales and it will be completed by 2015 to enhance GOME's business growth on the Chinese mainland.