BEIJING, Aug. 27 -- China's major industrial firms reported a smaller profit decline in July, official data showed Sunday.

Industrial firms with annual main business revenue of at least 20 million yuan (about 2.78 million U.S. dollars) saw their combined profits in July down 6.7 percent from a year ago, narrowing from the 8.3-percent drop in June, data from the National Bureau of Statistics (NBS) showed.

In the first seven months, the profits of major industrial firms reached 3.94 trillion yuan, down 15.5 percent year on year, narrowing by 1.3 percentage points from the first half of the year.

The power, heating, gas, and water production and supply sectors saw combined profits rise 38 percent year on year to hit 391.82 billion yuan in the first seven months.

Of the 41 industrial categories monitored by the bureau, 13 posted better performance in profits during the January-July period, the NBS said.

Output of products such as photovoltaic devices, lithium-ion batteries and household air conditioners surged, helping profits of the equipment manufacturing sector increase by 1.7 percent year on year during the first seven months.

From January to July, the profit decline of state-holding enterprises narrowed 0.7 percentage points from the first six months, according to the NBS.

China's business profits continued the recovery trend, said NBS statistician Sun Xiao, adding that efforts should be made to thoroughly implement macro policies accurately and effectively, expand effective demand, continue to boost market confidence, stimulate the vitality of business entities, and promote the sustained recovery of the industrial economy.