Changchai Company, Limited Annual Report 2018 (Summary)
Stock Code: 000570, 200570 Stock Name: Changchai, Changchai-B Announcement No. 2019-007
CHANGCHAI COMPANY, LIMITED
ANNUAL REPORT 2018 (SUMMARY)
Part I Important Notes
This Summary is based on the full text of the 2018 Annual Report of Changchai Company, Limited (together
with its consolidated subsidiaries, the “Company”, except where the context otherwise requires). In order for a full
understanding of the Company’s operating results, financial position and future development plans, investors
should carefully read the aforesaid full text, which has been disclosed together with this Summary on the media
designated by the China Securities Regulatory Commission (the “CSRC”).
The director Mrs.Zhang Qiong was not present at the board session for reviewing this annual repoet and its
summary and thus entrusted the Chairman of the Board Mr.Shi Xinkun to vote on behalf of her.
Independent auditor’s modified opinion:
□ Applicable √ Not applicable
Board-approved final cash and/or stock dividend plan for ordinary shareholders for the Reporting Period:
√ Applicable □ Not applicable
Bonus issue from capital reserves:
□ Yes √ No
The Board has approved a final dividend plan for the ordinary shareholders as follows: based on the
561,374,326 shares, a cash dividend of RMB0.25 (tax inclusive) per 10 shares is to be distributed to the
shareholders, with no bonus issue from either profit or capital reserves.
Board-approved final cash and/or stock dividend plan for preferred shareholders for the Reporting Period:
□ Applicable √ Not applicable
This Report and its summary have been prepared in both Chinese and English. Should there be any
discrepancies or misunderstandings between the two versions, the Chinese versions shall prevail.
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Changchai Company, Limited Annual Report 2018 (Summary)
Part II Key Corporate Information
1. Stock Profile
Changchai，
Stock name Stock code 000570, 200570
Changchai-B
Stock exchange for stock
Shenzhen Stock Exchange
listing
Contact information Board Secretary Securities Representative
Name He Jianjiang
123 Huaide Middle Road,
Address
Changzhou, Jiangsu, China
Fax （86）519-86630954
Tel. （86）519-68683155
Email address cchjj@changchai.com
2. Principal Activities or Products in the Reporting Period
As a manufacturer, we specialize in the manufacture and sale of diesel engines, diesel engine fittings and
castings, gasoline engines, gasoline engine fittings, rotovators, walking tractors, molds and jigs as well as the
assembly and sale of diesel engine and gasoline engine supporting sets.
We mainly manufacture and sell small and medium-sized single-cylinder and multi-cylinder diesel engines
under the brand of “Changchai”, which are often used in tractors, combine-harvesters, light commercial vehicles,
agriculture equipment, small-sized engineering machinery, generator sets, ship machines, etc.
3. Key Financial Information
(1) Key Financial Information of the Past Three Years
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Yes √ No
Unit: RMB
2018-over-2017
2018 2017 2016
change (%)
Operating revenue 2,132,902,718.60 2,423,058,958.29 -11.97% 2,283,028,855.52
Net profit attributable to
the listed company’s 62,021,374.04 46,431,302.73 33.58% 62,539,896.17
shareholders
Net profit attributable to
the listed company’s -43,333,196.13 18,818,435.16 —— 56,835,566.28
shareholders before
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Changchai Company, Limited Annual Report 2018 (Summary)
exceptional items
Net cash generated
from/used in operating 273,819,526.89 -121,669,279.39 —— 99,473,944.04
activities
Basic earnings per share
0.11 0.08 37.50% 0.11
(RMB/share)
Diluted earnings per
0.11 0.08 37.50% 0.11
share (RMB/share)
Weighted average return
2.84% 2.00% 0.84% 3.00%
on equity (%)
Change of 31
December 2018
31 December
31 December 2018 31 December 2017 over 31
2016
December 2017
(%)
Total assets 3,542,019,195.75 3,722,905,285.05 -4.86% 3,724,857,266.71
Equity attributable to
the listed company’s 2,043,308,026.74 2,246,896,857.86 -9.06% 2,323,712,892.92
shareholders
(2) Key Financial Information by Quarter
Unit: RMB
Q1 Q2 Q3 Q4
Operating revenue 593,008,785.46 593,752,106.80 432,605,495.58 513,536,330.76
Net profit attributable to
the listed company’s 11,343,577.44 7,294,980.22 4,670,842.38 38,711,974.00
shareholders
Net profit attributable to
the listed company’s
11,141,982.06 6,120,841.19 -5,982,192.17 -54,613,827.21
shareholders before
exceptional items
Net cash generated
from/used in operating -73,259,277.76 67,650,424.61 -48,642,944.44 328,071,324.48
activities
Indicate by tick mark whether any of the quarterly financial data in the table above or their summations differs
materially from what have been disclosed in the Company’s quarterly or interim reports.
□ Yes √ No
4. Share Capital and Shareholder Information at the Period-End
(1) Numbers of Ordinary Shareholders and Preferred Shareholders with Resumed Voting Rights as well as
Holdings of Top 10 Shareholders
Unit: share
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Changchai Company, Limited Annual Report 2018 (Summary)
Number of
Number of preferred
Number of
Number of ordinary shareholders
preferred
ordinary shareholders at with resumed
shareholders
shareholders 49,546 the month-end 57,411 0 voting rights at 0
with resumed
at the prior to the the month-end
voting rights at
period-end disclosure of prior to the
the period-end
this Report disclosure of
this Report
Top 10 shareholders
Total shares Shares in pledge or
Name of Nature of Shareholding frozen
held at the Restricted shares held
shareholder shareholder percentage
period-end Status Shares
Changzhou
State-owned
Investment 30.43% 170,845,236
legal person
Group Co., Ltd
KGI Asia Foreign legal
0.57% 3,189,845
Limited person
Domestic
Zhang Ruirong 0.32% 1,789,800
natural person
Domestic
Wan Peizhong 0.29% 1,645,800
natural person
Domestic
Huang Guoliang 0.27% 1,528,891
natural person
Domestic
Hu Wenyong 0.27% 1,500,066
natural person
Domestic
Gao Yuehua 0.25% 1,390,500
natural person
Domestic
Li Suinan 0.24% 1,356,000
natural person
Domestic
Xiong Shunbao 0.23% 1,282,251
natural person
Vanguard Total
Foreign legal
International 0.23% 1,277,294
person
Stock Index Fund
Strategic investor or general
legal person becoming a top-10
N/A
ordinary shareholder due to
rights issue
It is unknown whether there is among the top 10 public shareholders and the
Related or acting-in-concert
top 10 unrestricted public shareholders any related parties or acting-in-concert
parties among the shareholders
parties as defined in the Administrative Measures for Information Regarding
above
Shareholding Alteration.
(2) Number of Preferred Shareholders and Shareholdings of Top 10 of Them
□ Applicable √ Not applicable
No preferred shareholders in the Reporting Period.
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Changchai Company, Limited Annual Report 2018 (Summary)
(3) Ownership and Control Relations between the Actual Controller and the Company
According to the document of Changzhou Municipal People's Government (CZF[2006] No. 62]), both the
Company and Changzhou Investment Group Co., Ltd. belong to the enterprises to perform the responsibilities of
investors under supervision of the State-owned Assets Supervision and Administration Commission of Changzhou
Municipal People's Government authorized by Changzhou Municipal People's Government. In view of this, after
the equity transfer, Changzhou Investment Group Co., Ltd. is the controlling shareholder of the Company, and the
State-owned Assets Supervision and Administration Commission of Changzhou Municipal People's Government
is still the actual controller of the Company.
5. Corporate Bonds
Does the Company have any corporate bonds publicly offered on the stock exchange, which were outstanding
before the date of this Report’s approval or were due but could not be redeemed in full?
No.
Part III Operating Performance Discussion and Analysis
1. Business Overview of the Reporting Period
Is the Company subject to any industry-specific disclosure requirements?
No.
In 2018, China was facing a negative macroeconomic environment. Affected by changes in agricultural
subsidies, emission regulation updates, fluctuations in raw material prices and other factors, the agricultural
machinery market was under depression. In the deep adjustment stage of the agricultural machinery industry, the
Company strengthened product advantages, accelerated market expansion and pushed forward product planning
step by step. Meanwhile, management and operational efficiency have been improved to some degree. Despite the
intensified market competition, the Company maintained an orderly development. With the decline in the overall
sales of the single cylinder engine industry, the Company’s sales also declined but at a slower pace than the
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Changchai Company, Limited Annual Report 2018 (Summary)
industry average, while maintaining the largest market share in the industry. During the Reporting Period, the
Company sold 713,300 thousand units of diesel engines, gasoline engines and related generator sets, including
138,000 units of gasoline engines, generating total sales revenue of RMB2,132,902,718.60, a drop of 11.97 %
over last year.
In respect of product development and structural adjustment, several common rail models of single cylinder
and multi-cylinder engines have been developed to fully meet the State III emission standards of non-road mobile
machinery and the State V emission standards of road mobile machinery, leaving space for meeting higher
emission standards. Product models cover farm machinery such as harvesters and tractors in different power
sections, and gradually involved in the subdivision fields of tower base station, ship machine, prospecting,
transportation and so on.
In terms of quality management, the Company further improved the quality control process of product
development process. It promoted technical exchanges, quality management, and the adjustment of product
development. During the reporting period, Changchai organized 31 QC group activities, and the excellent QC
achievements recommended outwards were included in the national mechanical industry quality achievement
collections.
Speaking of marketing management, the Company solidified the existing advantages and enlarged the share
of superior products. It kept improving service capabilities by building good cooperative partnership with
customers and suppliers, adapting to market changes for opportunities to expand the market and promoting new
areas of supporting products. In 2018, Changchai achieved a market service satisfaction of products higher than
the average level in 2016 and 2017 and an increasingly greater market reputation.
To achieve better internal management, the Company further improved the Articles of Association,
reinforced the construction of internal control system and the supervision of key projects. By deepening the
medium-term special audit, it improved risk prevention and control ability and the quality of internal audit work.
As timely measures are taken to solve problems, operational efficiency of the Company is improved.
2. Significant Change to Principal Activities in the Reporting Period
□ Yes √ No
3. Product Category Contributing over 10% of Principal Business Revenue or Profit
√ Applicable □ Not applicable
Unit: RMB
YoY change in YoY change in YoY change in
Product Gross profit
Operating revenue Operating profit operating operating gross profit
category margin
revenue (%) profit (%) margin (%)
Diesel
1,945,336,290.52 291,243,934.15 14.97% -12.88% -9.10% 0.62%
engines
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Changchai Company, Limited Annual Report 2018 (Summary)
Gasoline
130,329,100.71 16,313,056.85 12.52% -18.98% -16.03% 0.44%
engines
4. Business Seasonality that Calls for Special Attention
□ Yes √ No
5. Significant YoY Changes in Operating Revenue, Cost of Sales and Net Profit Attributable to the Listed
Company’s Ordinary Shareholders or Their Compositions
□ Applicable √ Not applicable
6. Possibility of Listing Suspension or Termination
□ Applicable √ Not applicable
7. Matters Related to Financial Reporting
(1) YoY Changes to Accounting Policies, Accounting Estimates or Measurement Methods
√ Applicable □ Not applicable
1. Changes to accounting policies
Notes of the Ministry of Finance on Revising and Printing the Format of 2018 General Enterprises Financial
Statement (CK [2018] No. 15) was issued by the Ministry of Finance on 15 June 2018, which revised the format
of general enterprises financial statements. After it was being reviewed and approved by the 14th Meeting of the
8th Board of Directors, the Company began to implement the above-mentioned notice on the required time by the
Ministry of Finance. And retroactive adjustment was adopted for the changes in the accounting policy.
The items and amount of the influenced consolidated balance sheet on 31 December 2017:
Unit: RMB
Before adjustment After adjustment
Item Amount Item Amount
Notes receivable 716,404,345.57 Notes and accounts
1,108,415,299.12
Accounts receivable 392,010,953.55 receivable
Other receivables 5,794,971.22
Interest receivable 0.00 Other receivables 5,794,971.22
Dividends receivable 0.00
Fixed assets 560,049,970.50
Fixed assets 560,049,970.50
Disposal of fixed assets 0.00
Construction in process 94,581,989.06
Construction in process 94,581,989.06
Engineering material 0.00
Notes payable 347,070,500.00 Notes and accounts 963,299,000.18
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Changchai Company, Limited Annual Report 2018 (Summary)
Accounts payable 616,228,500.18 payable
Other payables 192,094,243.08
Interest payable 0.00 Other payables 195,985,676.91
Dividends payable 3,891,433.83
Administrative expense 184,550,915.26 107,835,619.11
Administrative expense
R&D expense 76,715,296.15
2. Changes to accounting estimates
No such cases in the Reporting Period.
(2) Retrospective Restatements due to Correction of Material Accounting Errors in the Reporting Period
□ Applicable √ Not applicable
No such cases.
(3) YoY Changes to the Scope of Consolidated Financial Statements
□ Applicable √ Not applicable
No such cases.
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