Beijing is holding firm, but many Chinese firms acknowledge they’re worried about the trade war

Several of China’s largest companies are acknowledging that they’re concerned about risks from a trade war with the U.S.

In the face of tariffs on the bulk of exports to its largest trading partner, Beijing has maintained a resolute position that it will respond with countermeasures. But some local corporations, many owned or influenced by the state, have voiced worries about the rising trade tensions in their latest earnings releases and other financial documents.

For one, Industrial and Commercial Bank of China, or ICBC, said late last month that a primary challenge the bank faces is increased instability and uncertainty in the international environment and intensifying global financial market volatility, especially since rising U.S.-China economic tensions may negatively affect many sectors.

That’s according to a translation of a Chinese-language mid-year report from the Beijing-based bank, the largest in the world by assets. CNBC accessed the filing through Wind, a financial terminal operated by a Shanghai-based company. Using the database, CNBC found numerous mentions of trade risks in other mainland Chinese mid-year reports, statements to analysts and financial documents in the last month.

Notably, Yantai China Pet Foods laid out a detailed analysis of the potential impact from the U.S. President Donald Trump’s proposed 25 percent tariffs on $200 billion worth of Chinese goods — which include dog and cat food.

About 30 percent of the medium-sized company’s operating revenues come from exports to the U.S., the firm said in a report issued late Tuesday Beijing time to address concerns about a convertible bond offering.

Yantai China Pet Foods said its 2017 return on assets excluding one-time items was 16.49 percent. With a 10 percent or 25 percent tariff, that would have only come out as a return of 13.16 percent or 8.31 percent, respectively, the company said.

Looking ahead, the company said that, if it must bear the entire 25 percent tariff burden, then return on assets this year will be around 4.6 percent. If U.S. consumers bear half the cost of the duties, the pet food company projected 2018 return on assets of just under 6 percent. Stopping exports to the U.S. would lower return on assets to about 5 percent, Yantai China Pet Foods said.

The company did note it expects increased demand in China and Europe to offset any drop in exports to the U.S. The firm also said it has a factory in the U.S. that accounts for about 15 percent of total sales.

Over a two-year period, the weighted average return on assets would not fall below 6 percent, still allowing the company to issue convertible bonds, the report said.

To be sure, many companies did not mention risks from rising trade tensions, or noted the impact to their business would likely be minimal.

For example, rubber and plastic goods producer Anhui Zhongding Sealing said in a filing that all its products are named in the latest proposal for $200 billion worth of tariffs. However, the company noted there is no impact from the current U.S. duties, and that the world’s largest economy accounts for a relatively small proportion of the company’s global market.

The CNBC analysis only covered mainland-traded Chinese stocks, known as A shares, and not those in Hong Kong, where many major Chinese companies are traded or have a dual listing.

Other company mentions of the trade tensions include:

China Southern Airlines: In the second half of 2018, U.S.-China trade tensions may increase downward pressure on China’s economy, the company said. At the same time, it added, China’s airline industry also faces high oil prices and fluctuations in the yuan, causing near-term challenges to operating profits.

Jiangsu Sunshine: China’s share of textile imports into the European Union, U.S. and Japan has decreased this year, the company said. The yuan’s declines, increasing U.S.-China trade tensions and rising textile industries in Vietnam and other southeast Asian countries have increased uncertainty around the development of China’s textile industry, according to the firm.

Shanghai Pudong Development Bank: The U.S.-China trade tensions have increased uncertainty around China’s economic growth, the bank said.

China Merchants Bank: Regarding the second half of the year, the U.S.-China trade war may increase uncertainty around the domestic economy, the Shenzhen-based bank said. As a result, it added, growth will likely slow compared with the first half of the year, putting pressure on the steady growth of credit assets and the pricing of risk assets.

Guangdong Haid – In the first half of the year, the company said, the feed industry was negatively impacted by consumption trends, low prices in the breeding market, promotion of environmental protection policies and U.S.-China trade tensions that caused raw material soybean meal prices to fluctuate. Not only did small and medium-sized enterprises suffer and exit the market, it added, but some large companies also faced increased difficulties of weak growth and even declines in sales and profits.