CHANGCHAI COMPANY, LIMITED
THE THIRD QUARTERLY REPORT 2009
Oct. 2009CHANGCHAI COMPANY, LIMITED
THE THIRD QUARTERLY REPORT 2009
§ 1 Important Notes
1.1 The Board of Directors, the Supervisory Board, directors, supervisors and senior
management staff of Changchai Company, Limited (hereinafter referred to as “the Company”)
hereby confirm that this report contains no false information, misleading statements or material
omission, and accept, individually and collectively, the responsibilities for the factuality,
accuracy and completeness of the contents of this report.
1.2 None of the directors, supervisors, or senior management demonstrated uncertainty or
disagreement about the factuality, accuracy, and completeness of this quarterly report.
1.3 Director Mr. Xu Zhenping was absent from the Board meeting due to business trip,
entrusted Director Mr. Xue guojun to vote on his behalf.
1.4 The Financial Report of this quarterly report has not been audited by a CPA firm.
1.5 Mr. Xue Guojun, Person-in-charge of the Company, Mr. He Jianguang, Person-in-charge of
the accounting work and Mr. Tang Jianzhong, Person-in-charge of the accounting department
hereby confirm that the Financial Report enclosed in the Quarterly Report is factual and
complete.
§2 Company Profile
2.1 Major accounting data and financial indexes
Unit: (RMB) Yuan
2009.9.30 2008.12.31 Increase/decrease（％）
Total assets 2,681,086,734.86 1,897,782,775.32 41.27%
Owners’ equity (or shareholders’
equity) 1,595,199,278.16 1,147,886,088.12 38.97%
share capital 561,374,326.00 374,249,551.00 50.00%
Net assets per share attributable to
shareholders of listed company 2.84 3.07 -7.49%
Jul.-Sept. 2009
Increase/decrease
over same period
of last year
Jan.-Sept. 2009
Increase/decrease
over same period
of last year
Total operation revenue 640,188,106.36 33.49% 1,887,700,868.96 15.82%
Net profit attributable to
shareholders of listed company 17,046,937.86 205,767,404.12
Net cash flows generated from
operating activities - - 361,351,822.96
Net cash flows per share generated
from operating activities - - 0.64Basic earnings per share 0.03 0.367
Diluted earnings per share 0.03 0.367
Fully diluted return on net assets 1.07% 2.80% 12.90% 14.29%
Fully diluted return on net assets
after deducting extraordinary gains
and losses
1.04% 2.46% 5.12% 6.05%
Items of extraordinary gains and losses
Extraordinary gains and losses From year-begin to the end of report period
Gains and losses from disposal of non-current assets 155,696,100.51
Governmental subsidies recorded into the current gains and
losses
2,111,756.76
Gains and losses from changes in fair value of the held tradable
financial assets and liabilities, and investment income from
disposal of tradable financial assets and liabilities and
available-for-sale financial assets
14,709,375.00
Other non-business income and expenses-net -7,135,329.55
effect of extraordinary gains and losses on income tax -41,345,475.68
Total 124,036,427.04
2.2 Total number of shareholders at period-end and shareholding of top ten shareholders
holding tradable shares
Unit: share
Total number of shareholders at period-end 106833
Shareholding of top ten shareholders holding tradable shares
Name of shareholder (full name)
Number of tradable shares
held at period-end
Type of share
STATE-OWNED ASSETS SUPERVISION AND
ADMINISTRATION COMMISSION OF
CHANGZHOU MUNICIPAL GOVERNMENT
170,897,736 RMB ordinary shares
SONG MIAOFANG 1,161,000 RMB ordinary shares
YU YAOJIN 1,133,300 RMB ordinary shares
YU XIAOPING 1,103,650 Domestically listed foreign shares
TOYO SECURITIES ASIA LIMITED-A/C
CLIENT.
1,055,098 Domestically listed foreign shares
LIU HUI 985,257 RMB ordinary shares
NORGES BANK 898,350 Domestically listed foreign shares
LI TAO 838,391 Domestically listed foreign shares
XIE FENGXIA 784,674 RMB ordinary shares
MENG NINA 682,595 RMB ordinary shares
§ 3 Significant Events3.1 Particulars about major changes of main accounting statement items and financial
indicators, as well as reasons for the changes
√Applicable □Inapplicable
1. Monetary funds increased considerably over that at the year-begin mainly because in the
report period, the Company sold 4.5 million shares of Foton Motor and transferred 35,117,105
shares of Kaima B, which resulted in the increase of bank deposits.
2. The decrease of transactional financial assets was due to that in the report period, the
Company sold 4.5 million shares of Foton Motor held by it, which had been recorded as
transactional financial assets.
3. The accounts receivable increased over that at the year-begin mainly because in the report
period, the Company sold its goods on credit in an appropriate degree according to relevant
agreements and plans so as to expand the market.
4. Inventories decreased compared to the year-begin mainly because the inventories that the
Company reserved for this quarter at the year-begin were sold as scheduled in the report
period.
5. Available-for-sale financial assets increased compared to the year-begin mainly because the
market value of 36,125,000 shares of Foton Motor held by the Company rose along with the
rise of the secondary market stock price in the report period.
6. Long-term equity investment decreased over the year-begin because in the report period, the
Company sold the 35,117,105 shares of Kaima B held by it.
7. Notes payable was up compared to that at the year-begin mainly because in the report period,
the Company paid its suppliers more often via banker’s acceptance bills.
8. Payroll payable registered a significant reduction over that at the year-begin mainly because
the Company withdrew some salary reserves at the period-begin, which were paid in the report
period.
9. Other accounts payable grew much higher than that at the year-begin mainly because the
Company would probably increase its selling concession and service expenses so as to expand
the market and improve the after-sale service.
10. Deferred income tax liabilities were higher than that at the year-begin mainly due to the fair
value rise of the Foton Motor shares and Jiangsu Expressway shares held by the Company in
the report period.
11. Share capital increased because in the report period, the Company implemented the 2009
interim dividend plan, i.e. to distribute 5 shares and cash of RMB 0.8 for every 10 shares. As a
result, the capital share of the Company rose from 374,249,551 shares to 561,374,326 shares.
12. Capital reserves increased over that at the year-begin mainly because the market value of
36,125,000 shares of Foton Motor held by the Company rose along with the rise of the
secondary market stock price in the report period.
13. Investment gains increased because in the report period, the Company sold its 4.5 million
shares of Foton Motor recorded as transactional financial assets and transferred its 35,117,105
shares of Kaima B to China Hengtian Group Co., Ltd. at the price of RMB 5.33 per share.
14. Net profit increased significantly over last year mainly because: 1) In the report period, the
sales of the Company improved compared with the same period of last year. Meanwhile, the
product cost was controlled and the profit from the main businesses increased; 2) In the first
half of 2009, the Company sold its 4.5 million shares of Foton Motor recorded as transactionalfinancial assets, which generated an accumulative income before tax amounting to RMB
14,805,000 for the first three quarters of 2009; and 3) The Company transferred its 35,117,105
shares of Kaima B to China Hengtian Group Co., Ltd. at the price of RMB 5.33 per share,
which generated a total income before tax reaching RMB 155,467,758.02.
3.2 Progress and influence of significant events, as well as the analysis on solutions
□Applicable √Inapplicable
3.3 Fulfillment of commitments made by the Company, shareholders and the actual controller
□Applicable √Inapplicable
3.4 Warnings of possible losses or major changes of the accumulative net profit achieved
during the period from year-begin to the end of the next report period compared with the same
period of last year, as well as explanation on reasons
□Applicable √Inapplicable
3.5 Other significant events that need to be explained
3.5.1 Securities investment
√Applicable □Inapplicable
No.
Type of
stock
Code of stock
Short form of
stock
Initial
investment
(RMB)
Shares held
（share）
Book value at
period-end
Proportion in
total
securities
investment at
period-end
(%)
Gains/losses in
report period
Other securities investment held at period-end 0 0 0 0 0
Gains and losses from securities investment sold in
report period
— — — — 14,709,375.00
Total 0 — 0 0 14,709,375.00
3.5.2 Equity of other listed companies held by the Company
√Applicable □Inapplicable
Stock code Short form of
stock
Initial
investment
Proportion in
total equity
of the
invested
company
Book value at
period-end
Gains/losses in
report period
Changes of
owners’ equity in
report period
600166 Foton Motor 41,784,000.00 3.94% 535,733,750.00 0.00 361,972,500.000
600377 Jiangsu
Expressway 90,500.00 294,500.00 0.00 22,500.00
Total 41,874,500.00 — 536,028,250.00 0 361,995,000.00
3.5.3 Researches, interviews and visits received in report period
√Applicable □Inapplicable
Date Place Way of
reception Visitor Main discussion and materials
provided by the Company
5 Feb. 2009
The 3rd Meeting
Room of the
Company
Field research
Fortune SGAM
Fund Management
and SYWG BNP
PARIBAS Asset
Main operation of the Company,
influence of macro-policies on it and
its future developmentManagement
6 Feb. 2009
The 3rd Meeting
Room of the
Company
Field research Changjiang
Securities
Main operation of the Company,
influence of macro-policies on it and
its future development
9 Feb. 2009
The 3rd Meeting
Room of the
Company
Field research Guosen Securities Main operation of the Company and
its future development
8 Sept. 2009
The 3rd Meeting
Room of the
Company
Field research Naito Securities Main operation of the Company and
its future development§ 4 Attachments
4.1 Balance sheet
Prepared by: Changchai Company, Limited 30 Sept. 2009 Unit: (RMB) Yuan
Amount at period-end Amount at period-begin
Items
Consolidation Parent company Consolidation Parent company
CURRENT ASSETS: 819,953,100.24 772,348,444.06 402,778,967.15 378,820,707.08
Monetary capital
Settlement fund reserves
Lendings to banks and other
financial institutions
21,645,000.00 21,645,000.00
Transactional financial assets 41,434,568.80 40,284,568.80 27,121,088.60 26,721,088.60
Notes receivable 350,799,084.99 318,514,428.75 204,208,036.51 160,990,383.74
Accounts receivable 7,617,028.17 6,003,364.13 9,683,253.18 8,569,751.19
Prepayments
Premium receivables
Receivables from reinsurance
Reinsurance contract reserve
receivables
Interest receivables
Other receivables 15,718,300.58 15,088,285.61 28,063,069.38 27,899,889.79
Financial assets purchased under
agreements to resell
Inventories 195,139,925.86 145,645,197.07 323,777,713.81 289,425,993.52
Non-current assets due within 1
year
0.00 0.00
Other current assets 405,379.50
TOTAL CURRENT ASSETS 1,431,067,388.14 1,297,884,288.42 1,017,277,128.63 914,072,813.92
NON-CURRENT ASSETS:
Loans and advances
Available-for-sale financial assets 536,028,250.00 536,028,250.00 174,033,250.00 174,033,250.00
Investments held to maturity 0.00 0.00
Long-term receivables 0.00 0.00
Long-term equity investments 61,769,522.61 112,109,322.61 93,179,255.93 143,519,055.93
Investment properties 71,083,160.03 71,083,160.03 72,739,415.63 72,739,415.63
Fixed assets 367,979,401.99 310,528,490.51 364,125,318.48 308,323,648.71
Construction in progress 107,925,887.52 105,574,905.32 69,705,698.81 67,525,098.81
Construction materials
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 104,080,238.93 101,781,273.19 106,102,470.72 103,756,831.97
Development expendituresGoodwill
Long-term deferred expenses
Deferred income tax assets 1,152,885.64 1,152,885.64 620,237.12 620,237.12
Other non-current assets
TOTAL NON-CURRENT ASSETS 1,250,019,346.72 1,238,258,287.30 880,505,646.69 870,517,538.17
TOTAL ASSETS 2,681,086,734.86 2,536,142,575.72 1,897,782,775.32 1,784,590,352.09
CURRENT LIABILITIES:
Short-term borrowings 44,500,000.00 51,200,000.00
Borrowings from central bank
Deposits received and held for
others
Borrowings from banks and other
financial institutions
Held-for-trading financial
liabilities
Notes payable 285,682,400.00 256,190,000.00 136,103,600.00 126,990,000.00
Accounts payable 380,006,648.26 347,621,753.89 361,368,076.43 334,431,191.26
Advances from customers 39,492,221.25 39,345,818.37 24,690,165.89 24,543,763.01
Financial assets sold under
agreements to repurchase
Fees and commissions payables
Payroll payables 6,754,776.46 3,637,347.63 25,369,781.88 21,831,003.69
Taxes payable 1,102,550.15 5,481,235.42 -29,212,801.62 -27,781,020.54
Interest payables
Other payables 184,759,936.54 181,858,754.02 88,548,123.52 89,518,212.18
Accounts due to reinsurance
Insurance contract reserves
Acting trading securities
Acting underwriting securities
Non-current liabilities due within
1 year
0.00 0.00
Other current liabilities 10,802,376.83 3,243,179.97 4,654,904.31 3,771,298.47
TOTAL CURRENT LIABILITIES 953,100,909.49 837,378,089.30 662,721,850.41 573,304,448.07
NON-CURRENT LIABILITIES
Long-term borrowings 42,000,000.00 42,000,000.00
Bonds payable
Long-term payables
Special payables 690,000.00 690,000.00 690,000.00 690,000.00
Estimated liabilities
Deferred income tax liabilities 123,538,437.50 123,538,437.50 37,149,762.50 37,149,762.50
Other non-current liabilities
TOTAL NON-CURRENT
LIABILITIES
124,228,437.50 124,228,437.50 79,839,762.50 79,839,762.50TOTAL LIABILITIES 1,077,329,346.99 961,606,526.80 742,561,612.91 653,144,210.57
OWNERS’ EQUITY (OR
SHAREHOLDERS’ EQUITY)
Paid-in capital (or share capital) 561,374,326.00 561,374,326.00 374,249,551.00 374,249,551.00
Additional paid-in capital 543,969,936.26 553,659,622.45 272,484,186.26 282,163,372.45
Less: treasury stock
Earned surplus 240,369,344.92 240,369,344.92 240,369,344.92 240,369,344.92
General risk provision
Retained earnings 249,485,670.98 219,132,755.55 260,783,005.94 234,663,873.15
Foreign exchange difference
Total owners’ equity attributable
to parent company
1,595,199,278.16 1,574,536,048.92 1,147,886,088.12 1,131,446,141.52
Minority interest 8,558,109.71 7,335,074.29
TOTAL OWNERS’ EQUITY 1,603,757,387.87 1,574,536,048.92 1,155,221,162.41 1,131,446,141.52
TOTAL LIABILITIES &
OWNERS’ EQUITY
2,681,086,734.86 2,536,142,575.72 1,897,782,775.32 1,784,590,352.094.2 Income Statement as of this report period
Prepared by: Changchai Company, Limited Jul.-Sept. 2009 Unit: (RMB) Yuan
This report period Same period of last year
Items
Consolidation Parent company Consolidation Parent company
1. Total operation revenue 640,188,106.36 647,329,074.01 479,588,494.49 478,609,775.91
Including: sales revenue 640,188,106.36 647,329,074.01 479,588,494.49 478,609,775.91
Interest income
Premium income
Fee and commission
income
2. Total operation cost 609,883,644.37 615,518,208.44 493,037,064.04 491,289,409.90
Including: cost of sales 549,402,165.52 560,889,465.92 442,283,861.61 444,760,518.99
Interest expenses
Service charges and
commission expenses
Payments on surrenders
Claim expenses-net
Provision for insurance
contract reserve-net
Policyholder dividends
Reinsurance expenses
Business taxes and
surcharges
126,102.63 0.00 80,978.35 0.00
Selling expenses 18,069,508.24 17,452,840.92 21,061,743.91 20,434,273.43
Administrative expenses 47,215,390.69 43,844,611.58 38,047,457.27 35,372,560.41
Financial expenses -1,139,970.79 -2,769,885.86 -8,436,977.10 -9,277,942.93
Asset impairment loss -3,789,551.92 -3,898,824.12 0.00 0.00
Add: gain/loss from changes in
fair value (“-” for loss)
0.00 0.00 -5,580,000.00 -5,580,000.00
Gain/loss from investment
(“-” for loss)
-1,000,000.00 0.00 0.00 0.00
Including: investment
gain from associates and joint
ventures
Gain/loss from foreign
exchange difference (“-” for
loss)
3. Operation profit (“-” for loss) 29,304,461.99 31,810,865.57 -19,028,569.55 -18,259,633.99
Add: non-operating incomes 1,909,443.03 1,845,715.27 305,593.03 132,837.76
Less: non-operating expenses 7,935,351.30 7,935,351.30 2,751,488.85 2,685,801.30
Including: loss from disposal
of non-current assets
4. Total profit (“-” for total loss) 23,278,553.72 25,721,229.54 -21,474,465.37 -20,812,597.53Less: income tax expenses 7,002,095.45 7,471,483.20 -1,395,000.00 -1,395,000.00
5. Net profit (“-” for total loss) 16,276,458.27 18,249,746.34 -20,079,465.37 -19,417,597.53
Attributable to owners of
parent company
17,046,937.86 -19,891,951.48
Minority interest -770,479.59 -187,513.89
6. Earnings per share
(1) Basic EPS 0.03 -0.035
(2) Diluted EPS 0.03 -0.0354.3 Income statement as of the period from year-begin to the end of report period
Prepared by: Changchai Company, Limited Jan.-Sept. 2009 Unit: (RMB) Yuan
This period Same period of last year
Items
Consolidation Parent company Consolidation Parent company
1. Total operation revenue 1,887,700,868.96 1,902,649,332.62 1,629,881,402.45 1,635,042,597.07
Including: sales revenue 1,887,700,868.96 1,902,649,332.62 1,629,881,402.45 1,635,042,597.07
Interests income
Premium income
Fee and commission
income
2. Total operation cost 1,810,971,490.73 1,829,521,194.23 1,618,241,833.61 1,624,235,021.49
Including: cost of sales 1,633,240,414.63 1,667,308,966.07 1,476,621,481.93 1,495,586,894.32
Interests expenses
Service charges and
commission expenses
Payments on surrenders
Claim expenses-net
Provision for insurance
contract reserve-net
Policyholder dividends
Reinsurance expenses
Business taxes and
surcharges
237,724.82 0.00 282,565.93 0.00
Selling expenses 73,608,800.72 70,930,172.60 55,807,703.59 53,681,045.95
Administrative expenses 108,242,288.34 98,585,141.11 105,821,453.87 97,532,235.84
Financial expenses -4,357,737.78 -7,303,085.55 -16,290,266.51 -18,564,049.42
Asset impairment loss 0.00 0.00 -4,001,105.20 -4,001,105.20
Add: gain/loss from changes in
fair value (“-” for loss)
-16,440,300.00 -16,440,300.00 -35,640,000.00 -35,640,000.00
Gain/loss from investment
(“-” for loss)
186,636,611.33 187,636,611.33 4,074,817.06 4,074,817.06
Including: investment
gain from associates and joint
ventures
Gain/loss from foreign
exchange difference (“-” for
loss)
3. Operation profit (“-” for loss) 246,925,689.56 244,324,449.72 -19,925,614.10 -20,757,607.36
Add: non-operating incomes 8,078,835.13 5,223,256.91 3,301,711.34 2,255,999.51
Less: non-operating expenses 13,102,407.92 13,102,407.92 7,867,297.10 7,694,226.90
Including: loss from disposal
of non-current assets
4. Total profit (“-” for total loss) 241,902,116.77 236,445,298.71 -24,491,199.86 -26,195,834.75Less: income tax expenses 34,911,677.23 34,911,677.23 -8,910,000.00 -8,910,000.00
5. Net profit (“-” for total loss) 206,990,439.54 201,533,621.48 -15,581,199.86 -17,285,834.75
Attributable to owners of
parent company
205,767,404.12 201,533,621.48 -15,933,497.42 -17,285,834.75
Minority interest 1,223,035.42 352,297.56
6. Earnings per share
(1) Basic EPS 0.367 -0.028
(2) Diluted EPS 0.367 -0.0284.4 Cash flow statement as of the period from year-begin to the end of report period
Prepared by: Changchai Company, Limited Jan.-Sept. 2009 Unit: (RMB) Yuan
This period Same period of last year
Items
Consolidation Parent company Consolidation Parent company
1. Cash flows from operating
activities
Cash received from sales of
goods or rending of services
2,103,147,059.06 2,052,107,399.67 1,718,824,600.85 1,732,055,837.23
Net increase of deposits
received from and held for
customers
Net increase of borrowings
from central bank
Net increase of inter-bank
loans from other financial
institutions
Cash received against
original insurance contract
Net Cash received from
reinsurance
Net increase of client
deposits and investments
Net increase in disposal of
held-for-trading financial assets
Interests, handling charges
and commission received
Net increase of inter-bank
funds received
Net increase of cash received
under repurchasing
Tax and fare refunded 2,402,342.35
Other cash received from
operating activities
8,814,589.32 7,985,654.68 11,347,802.39 9,324,890.25
Sub-total of cash inflow
from operating activities
2,114,363,990.73 2,060,093,054.35 1,730,172,403.24 1,741,380,727.48
Cash paid for goods and
services
1,524,978,341.69 1,536,870,058.15 1,554,793,863.94 1,570,836,666.35
Net increase of loans and
advances
Net increase of deposits in
central bank, banks and other
financial institutions
Cash paid for original
contract claimCash paid for interests, fees
and commissions
Cash paid for policy
dividends
Cash paid to and for
employees
139,579,439.02 125,182,969.62 129,823,459.01 121,721,783.38
Taxes and fares paid 44,199,585.48 38,901,672.50 20,564,569.69 18,859,094.86
Other cash paid relating to
operating activities
44,254,801.58 36,505,974.90 49,059,569.54 46,862,783.03
Sub-total of cash outflows
from operating activities
1,753,012,167.77 1,737,460,675.17 1,754,241,462.18 1,758,280,327.62
Net cash flows from
operating activities
361,351,822.96 322,632,379.18 -24,069,058.94 -16,899,600.14
2. Cash flows from investing
activities
Cash received from return of
investments
36,911,141.63 36,911,141.63
Cash received from
investment income
187,339,903.02 187,339,903.02 4,074,817.06 4,074,817.06
Net cash received from
disposal of fixed assets, intangible
assets and other long-term assets
177,877.01 177,877.01 3,546,989.15 2,985,452.36
Net cash received from
disposal of subsidiaries and other
operating units
Other cash received relating
to investing activities
Sub-total of cash inflows
of investing activities
224,428,921.66 224,428,921.66 7,621,806.21 7,060,269.42
Cash paid for acquiring fixed
assets, intangible assets and other
long-term assets
84,188,018.39 79,028,599.50 73,821,260.36 70,009,275.90
Cash paid for acquiring
investments
Net increase of pledge loans
Net cash paid for acquisition
of subsidiaries and other operating
units
Other cash paid relating to
investing activities
Sub-total of cash outflows
of investing activities
84,188,018.39 79,028,599.50 73,821,260.36 70,009,275.90
Net cash flow from
investing activities
140,240,903.27 145,400,322.16 -66,199,454.15 -62,949,006.483. Cash flows of financing
activities
Cash received from
absorbing investments
Including: Cash received
from minority shareholders of
subsidiaries
Cash received from
borrowings
74,200,000.00 20,000,000.00 42,000,000.00
Cash received from bonds
issuing
Other cash received relating
to financing activities
18,564,049.42 18,564,049.42
Sub-total of cash inflows
of financing activities
74,200,000.00 20,000,000.00 60,564,049.42 18,564,049.42
Cash paid for settling debts 122,900,000.00 62,000,000.00 34,000,000.00
Cash paid for distribution of
dividends or profits or
reimbursing interest
34,605,793.14 32,504,964.36 30,342,499.24 28,068,716.33
Including: dividends or
profits paid to minority
shareholders by subsidiaries
Other cash paid relating to
financing activities
1,112,800.00
Sub-total of cash outflows
of financing activities
158,618,593.14 94,504,964.36 64,342,499.24 28,068,716.33
Net cash flows of
financing activities
-84,418,593.14 -74,504,964.36 -3,778,449.82 -9,504,666.91
4. Effect of foreign exchange rate
changes
5. Net increase of cash and cash
equivalents
417,174,133.09 393,527,736.98 -94,046,962.91 -89,353,273.53
Add: cash and cash
equivalents at the beginning of
this period
402,778,967.15 378,820,707.08 443,234,034.61 417,975,515.87
6. Cash and cash equivalents at
period-end
819,953,100.24 772,348,444.06 349,187,071.70 328,622,242.34
4.5 Auditor’s report
Audit opinion: Unaudited
