Changchai Company, Limited Annual Report 2021 (Summary)
Stock Code: 000570, 200570 Stock Name: Changchai, Changchai-B Announcement No. 2022-014
CHANGCHAI COMPANY, LIMITED
ANNUAL REPORT 2021 (SUMMARY)
Part I Important Notes
This Summary is based on the full 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”).
All the directors of the Company attended in person the board meeting for the approval of this Report.
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 ordinary shareholders as follows: based on the 705,692,507 shares,
a cash dividend of RMB0.26 (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.
Part II Key Corporate Information
1. Stock Profile
Changchai，
Stock name Stock code 000570, 200570
Changchai-B
Stock exchange for stock listing Shenzhen Stock Exchange
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Changchai Company, Limited Annual Report 2021 (Summary)
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
1. Principal Operations of the Company
We mainly specialize in the R&D, manufacture and sales of diesel engines under the brand "Changchai" and
gasoline engines under the brand "Robin". Our products are mainly used in agricultural machinery, small
construction machinery, light commercial vehicles, generator sets and shipborne machinery and other fields closely
related to people's livelihood.
In the Reporting Period, there were no major changes in the Company's core business and main products.
2. Main Products of the Company
Our main products are divided into two categories: diesel engines and gasoline engines. The details are as follows:
Main Application
Graphic display Product description Product features
products fields
Our diesel engine products include
single-cylinder diesel engines and
High power, low Agricultural
multi-cylinder engines, covering
oil consumption, machinery,
power range from 1.62kW to 117.6kW,
low noise, construction
Diesel and cylinder diameters from 65mm to
compact machinery,
engine 135mm, with one or more cylinders.
structure, low generator sets,
Besides sale in domestic market, our
emission, good shipborne
diesel engines are sold to Southeast
reliability machinery
Asia, South America, the Middle East
and Africa.
Our gasoline engines are mainly
general-purpose small gasoline
engines, covering the power range Agricultural
Simple structure,
Gasoline from 1.5kW to 7.0kW. Besides sale in machinery, small
good reliability,
engine domestic market, our gasoline engines construction
easy maintenance
are sold to Southeast Asia, the Middle machinery
East, Europe and America, Africa,
Japan and other countries and regions.
3. Major Business Models
(1) R&D model
We have established an innovative technology management system for internal combustion engine based on market
demand and forward-looking technologies. Prior to the new products or new technologies development, the
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Changchai Company, Limited Annual Report 2021 (Summary)
marketing department first conducts market assessment and customer research, and then initiates a project
according to the forecasted market demand; the technology center conducts development according to the project
materials, and collects feedback information from the market and customers in real time during the development
process to ensure technology leadership and product suitability.
(2) Purchasing model
We adopt the "purchase-to-order" purchasing model. The ERP system converts the sales orders, the sales plan
developed by the sales department and the production plan drawn up by the production department into the demand
of parts needed, and the purchasing department organizes the purchase according to such demand. Meanwhile, the
purchasing department makes a plan to guide parts procurement according to the sales department's sales plan, and
provide it to the supplier, and urge the supplier to prepare for the goods.
(3) Production model
We adopt the "make-to-order" production management model. The sales department makes sales plans for different
stages according to the orders in hand, sales data in previous years, market demand judgment and feedback of
existing customers' purchasing intentions. The Company's production department makes the production plan
according to the sales orders displayed in the ERP system, the sales plan made by the sales department and the
reserve inventory demand, and organizes the production task in strict accordance with the plan. During the
production process, the quality assurance department arranges regular inspection to ensure the product quality.
(4) Sale model
We adopt the sales model of "direct selling + distribution", i.e. the direct selling model for the main engine factory,
and the distribution model for the individual circulation market represented by farmers and overseas market.
4. The Company's position in the market
We mainly specialize in the R&D, manufacture and sales of diesel engines under the brand "Changchai" and
gasoline engines under the brand "Changchai Robin". Up to now, we have successfully developed a number of
advanced core technologies with independent intellectual property rights. In terms of diesel engine, according to the
statistics of China Internal Combustion Engine Industry Association (CICEIA), as the largest small- and
medium-sized single-cylinder diesel engine manufacturer in the agricultural machinery industry of China, we have
maintained a high market share of single-cylinder engines, and our market share of single-cylinder diesel engines of
some power ranges has ranked first in China. For many years, in the process of achieving steady economic
development of the enterprise, we developed in a sound manner and cultivated the "Changchai" brand, a famous
small diesel engine brand of China with independent intellectual property rights.
5. Key Performance Drivers
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Changchai Company, Limited Annual Report 2021 (Summary)
(1) National policy driver
In recent years, various departments of the state have introduced a series of preferential policies to encourage the
development of internal combustion engine industry. In terms of agricultural machinery, the central government has
taken solving the problems relating to "agriculture, rural areas and farmers" as the top priority of the work of the
Party and the government, and issued a series of policies to benefit farmers, creating a good atmosphere for
promoting the development of agriculture and economy and society in rural areas; in terms of construction
machinery, the strategy of "western development", the "eight vertical and eight horizontal" high-speed railway
network plan and the policy of "new rural construction" have all created a good policy environment for the
application of internal combustion engine in downstream construction machinery.
(2) Industrial chain synergy empowers the sustainable development of the Company
We have built our own casting manufacturing and processing plants to meet the use requirements of some diesel
engine parts. In terms of production and quality, we have formed a significant synergy with its own internal
combustion engine assembly team. Our casting manufacturing team and internal combustion engine assembly team
work together to form a mutually reinforcing positive feedback loop to assist the Company in integrating the
internal combustion engine industry chain and building differentiated industry barriers. In terms of collaborative
production, the reduction of external purchase is of great significance for the Company to reduce process flow,
reduce intermediate loss, improve production efficiency, shorten delivery time and increase purchasing bargaining
power. In terms of quality coordination, the self-built foundry can improve our quality control of parts to improve
the yield and reliability of internal combustion engines.
(3) Stable and efficient R&D team
We have experienced technical management team and perfect technical support team. Our key technical personnel
and R&D management personnel have been engaged in internal combustion engine R&D design, production and
manufacturing for a long time. With profound professional knowledge and rich practical experience, they can make
strong forward-looking and scientific judgment in the market direction and technical route. Also, we have
established an effective training mechanism to foster talented persons for the follow-up R&D.
(4) Well-known brand with many well-known customers
The Company, formerly known as Changzhou Diesel Engine Factory, is a national industrial enterprise with a
history of a hundred years and one of the earliest professional internal combustion engine manufacturers in China.
Our diesel and gasoline engines, as power sources of agricultural machinery, construction machinery and
commercial vehicles, show excellent performance in power range, reliability, power per litre, noise control and
emission standards, and have been recognized by customers. We maintained a long-term partnership with major
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Changchai Company, Limited Annual Report 2021 (Summary)
customers, with cumulative partnership time exceeding 15 years. Many main engine plant customers of the
Company are well-known enterprises in the agricultural machinery industry, with their market shares being at the
forefront of the market.
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
Change of 31
31 December 31 December December 2021 31 December
2021 2020 over 31 December 2019
2020 (%)
3,488,820,324.6
Total assets 4,860,382,961.26 3,952,954,464.45 22.96%
0
Equity attributable to the
2,110,892,767.5
listed company’s 3,077,550,018.33 2,273,349,347.02 35.38%
8
shareholders
2021-over-2020
2021 2020 2019
change (%)
2,045,820,801.1
Operating revenue 2,452,430,515.60 2,296,464,711.24 6.79%
0
Net profit attributable to the
listed company’s 103,006,232.54 52,432,443.05 96.46% 24,966,526.85
shareholders
Net profit attributable to the
listed company’s
5,329,092.87 25,483,147.57 -79.09% 14,405,485.64
shareholders before
exceptional gains and losses
Net cash generated
from/used in operating -266,323,779.30 251,796,654.53 -- -20,325,189.56
activities
Basic earnings per share
0.1657 0.0934 77.41% 0.0445
(RMB/share)
Diluted earnings per share
0.1657 0.0934 77.41% 0.0445
(RMB/share)
Weighted average return on
3.86% 2.40% 1.46% 1.21%
equity (%)
(2) Key Financial Information by Quarter
Unit: RMB
Q1 Q2 Q3 Q4
Operating revenue 774,218,489.69 722,951,966.11 484,183,670.58 471,076,389.22
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Changchai Company, Limited Annual Report 2021 (Summary)
Net profit attributable to the listed
24,571,254.83 104,617,810.77 -23,478,352.18 -2,704,480.88
company’s shareholders
Net profit attributable to the listed
company’s shareholders before 23,604,960.00 3,555,454.58 -9,073,885.20 -12,757,436.51
exceptional gains and losses
Net cash generated from/used in
774,218,489.69 722,951,966.11 484,183,670.58 471,076,389.22
operating 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
Number of
Number of Number of
preferred
ordinary preferred
Number of shareholders
shareholders shareholders
ordinary with resumed
at the with
shareholder 49,947 53,650 0 voting rights at 0
month-end resumed
s at the the month-end
prior to the voting rights
period-end prior to the
disclosure of at the
disclosure of
this Report period-end
this Report
Top 10 shareholders
Shareholdin Total shares Shares in pledge or
Nature of Restricted frozen
Name of shareholder g held at the
shareholder shares held
percentage period-end Status Shares
Changzhou
State-owned
Investment Group 32.26% 227,663,417 56,818,181
corporation
Co., Ltd
Nuode Fund-
Huazhang Tiandi
Media Investment
Co., Ltd.-Nuode Other 1.61% 11,363,636 11,363,636
Fund Pujiang No.64
Single Asset
Management Plan
China National Gold
Group Asset State-owned
1.51% 10,681,818 10,681,818
Management Co., corporation
Ltd.
Domestic
Chen Beiwen 1.03% 7,272,727 7,272,727
individual
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Changchai Company, Limited Annual Report 2021 (Summary)
Enjoy(Ningbo)Asset
Management
L.P.-Enjoy
Other 0.97% 6,818,181 6,818,181
Yingshanhong No.9
Private Securities
Investment Fund
Foreign
UBS AG 0.66% 4,631,555 3,409,090
corporation
Changzhou
Transportation
Construction State-owned
0.65% 4,595,454 4,545,454
Investment corporation
Development Co.,
Ltd.
Domestic
Yao Jianquan 0.64% 4,545,454 4,545,454
individual
Domestic
Sun Meichun 0.64% 4,545,454 4,545,454
individual
Jiangxi Jintou
Domestic
Industrial
non-state-own 0.64% 4,545,454 4,545,454
Development Co.,
ed corporation
Ltd.
It is unknown whether there is among the top 10 public shareholders
Related or acting-in-concert parties and the top 10 unrestricted public shareholders any related parties or
among the shareholders above acting-in-concert parties as defined in the Administrative Measures for
Information Regarding Shareholding Alteration.
Top 10 shareholders involved in
Not
securities margin trading (if any)
(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 2021 (Summary)
(3) Ownership and Control Relations between the Actual Controller and the Company
5. Outstanding Bonds at the Date when this Report Was Authorized for Issue
□ Applicable √ Not applicable
Part III Significant Events
1. Accomplishment of non-public offering of shares
On 17 December 2020, the Company received the Reply concerning the Approval of the Non-public Offering of
Shares of Changchai Company, Limited (ZJXK [2020] No. 3374) from the China Securities Regulatory
Commission, which approved the non-public offering of up to 168,412,297 shares of the Company. The Company's
offered 144,318,181 RMB ordinary shares (A shares) in a non-public manner. The issuing price was RMB4.40 per
share, total amount raised was RMB634,999,936.40, and the net amount actually raised was RMB620,665,733.97
after deducting various issuance expenses. The new shares issued in a non-public manner were listed on the
Shenzhen Stock Exchange on 5 July 2021. Except for the shares subscribed by the Investment Group, the restriction
has been lifted on 5 January 2022. For details, please refer to the Report on Non-public Offering by Changchai
Company, Limited and Listing Bulletin disclosed by the Company on www.cninfo.com.cn on 1 July 2021.
2. Participating in the Public Listed Transfer of 41.5% Equity Interests in Zhenjiang Siyang Diesel Engine
Manufacturing Co., Ltd.
The Sixth Interim Meeting of the Board of Directors in 2021 held by the Company on 28 October 2021 deliberated
on and approved the Proposal on Participating in the Public Listed Transfer of 41.5% Equity Interests in Zhenjiang
Siyang Diesel Engine Manufacturing Co., Ltd., authorizing the Management of the Company to participate in the
bidding of the public listed transfer by Jiangsu University of Science and Technology Assets Management Co., Ltd.
(hereinafter referred to as "Science University Assets") of its 41.5% equity interest in Zhenjiang Siyang Diesel
Engine Manufacturing Co., Ltd. (hereinafter referred to as "Zhenjiang Siyang"). On 12 January 2022, Zhenjiang
Siyang Diesel Engine Manufacturing Co., Ltd. issued the Confirmation of Transaction on the Transfer of 41.5%
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Changchai Company, Limited Annual Report 2021 (Summary)
Equity Interest (Corresponding to Capital Contribution of RMB830,000).The Company won the 41.5% equity
interest in Zhenjiang Siyang at a price of RMB33,520,800.00. On 23 February 2022, the Company signed the
Contract on Transfer of State-owned Property Rights with Science University Assets. On 9 March 2022, Zhenjiang
Siyang has completed the relevant registration alteration formalities with the competent industrial and commercial
administration.
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