Anhui Zhongding Sealing Parts Co.,Ltd.
Abstract of the Semi-Annual Report 2023
Stock Abbreviation：Zhongding Stock
Stock Code：000887
August 2023
1. Important statement
This is an abstract of the Semi-Annual Report 2023. Investors are suggested to read the complete version of the Semi-AnnualReport 2023 on the media, which is designated by the China Securities Regulatory Commission(the "CSRC") to have a fullunderstanding of operational results, financial statements, and future plans of the Company.Should there be any inconsistencybetween the Chinese version and English version, the Chinese version shall prevail.
All directors have attended this semi-annual report meeting of the board of directors.
Modified Audit Opinion
□ Applicable √ N/A
The preliminary plan for dividend distribution and converting capital reserves into share capital for common shareholders whichwere considered and approved by the Board during the reporting period
□ Applicable √ N/A
The company doesn’t plan to distribute cash dividends 、stock dividend and convert capital reserves into share capital.
The preliminary plan for dividend distribution for preferred shares in the reporting period was approved by the Board.
□ Applicable √ N/A
2. The Basic Information of the Company
A. Company profile
| Stock Abbreviation | Zhongding Stock | Stock Code | 000887 | |
| Stock Exchange Where the Shares of the Company are listed | ShenZhen Stock Exchange | |||
| Contact Us | Board Secretary | Securities Affairs Representative | ||
| Name | Jiang Weijian | Wang Songyuan | ||
| Address | Development Zone, Ningguo City, Anhui Province | Economic and Technological Development Zone, Ningguo City, Anhui Province | ||
| Tel. | 0563-4181887 | 0563-4181887 | ||
| jiangwj@zhongdinggroup.com | wangsy@zhongdinggroup.com | |||
B. The main financial data and financial indicatorWhether the Company performed a retroactive adjustment to or restatement of accounting data
□Yes ?No
| This reporting period | The same period of last year | Increase/decrease compared with previous year (%) |
| Operating income（RMB ） | 8,188,606,870.57 | 6,573,456,892.17 | 24.57% |
| Net profit attributable to shareholders of the listed company (RMB) | 531,210,932.73 | 470,532,188.44 | 12.90% |
| Net Profit Attributable to Shareholders of the Listed Company after Deducting Nonrecurring Gains and Losses (RMB) | 454,172,773.72 | 400,706,431.95 | 13.34% |
| Net cash flow from operating activities (RMB) | 403,288,126.03 | 452,646,622.41 | -10.90% |
| Basic earnings per share (RMB Yuan /share) | 0.40 | 0.37 | 8.11% |
| Diluted earnings per share (RMB Yuan /share) | 0.40 | 0.37 | 8.11% |
| Weighted average return on net assets | 4.72% | 4.78% | -0.06% |
| End of the reporting period | End of same period of last year | Increase/decrease compared with the end of the previous year (%) | |
| Total assets(RMB) | 22,307,282,055.59 | 21,124,309,445.51 | 5.60% |
| Net assets attributable to shareholders of the listed Company（RMB） | 11,527,503,321.09 | 11,168,127,264.81 | 3.22% |
C. The Number and Shareholdings of the Company’s Shareholders
单位：股
| Total number of common shareholders at the end of the Reporting Period | 76,687 | Total number of preferred shareholders with resumed voting rights at the end of the reporting period(If any) | 0 | ||||
| Top ten common shareholders | |||||||
| Name of Shareholders | Nature of Shareholders | Shareholding percentage | Total shares held at the end of the reporting period | Number of restricted shares held | Pledged or frozen shares | ||
| Status | Number | ||||||
| Anhui Zhongding Holding (Group) Co., LTD | Domestic non-state- owned corporation | 40.46% | 532,701,321 | Pledged | 142,500,000 | ||
| Hong Kong Securities Clearing Co., Ltd. | Foreign Corporation | 2.44% | 32,096,664 | ||||
| National Social Security Fund 102 portfolio | Others | 1.44% | 18,932,794 | ||||
| Everyone Life Insurance Co., LTD. - Universal | Others | 1.03% | 13,604,990 | ||||
| Products | ||||||
| Abu dhabi Investment Authority | Foreign Corporation | 0.98% | 12,937,063 | |||
| China Life Insurance Co Ltd.－ Traditional－ General insurance product-005L-CT001hu | Others | 0.82% | 10,776,881 | |||
| Miaosu | Domestic natural person | 0.80% | 10,519,602 | |||
| Ping An Bank Co., Ltd.-Boshi Growth Vanguard flexibly allocates hybrid securities investment funds | Others | 0.75% | 9,938,950 | |||
| Industrial and Commercial Bank of China Limited-Central European Times Pioneer equity sponsored securities investment fund | Others | 0.65% | 8,563,198 | |||
| Shanghai Pudong Development Bank Co.LTD-Yi Fang Da Yu Xiang return bond securities investment fund | Others | 0.62% | 8,118,072 | |||
| Explanation of the related relationship or concerted action of the above shareholders | The company does not know whether there is an associated relationship between the shareholders, and whether it is a person acting in concert stipulated in the "Administrative Measures for the Disclosure of Information on Changes in Shareholdings of Shareholders of Listed Companies". | |||||
| Description of shareholders participating in marginfinancing and securities lending business (if any) | As of June 30, 2023, one of the top 10 shareholders of the Company, Shareholder Miu Su, held 9,947,441 shares of the Company through the Customer Credit Transaction Secured Securities account of Huaxi Securities Co., LTD | |||||
D. Changes Of The Controlling Shareholder Or The Actual ControllerChange of the controlling shareholder in the reporting period
□ Applicable √ N/A
There was no any change of the controlling shareholder of the Company in the reporting period
Change of the actual controller in the reporting period
□ Applicable √ N/A
There was no any change of the actual controller of the Company in the reporting period
E. The Table Of The Total Number Of The Company’s Preferred Shareholders And The ShareholdingSituation Of Top 10 Preferred Shareholders
□ Applicable √ N/A
There is no shareholding of preferred shareholders during the reporting period.
F. Status Of The Bonds Existing On The Date Of Approval Of The Semi-Annual Report
□ Applicable √ N/A
3. Important Items
The company continued to promote the cost control and refined management of overseas factories. Underthe severe impact of the industry downturn and the external environment, the company further carried out a seriesof measures such as cost optimization and non-core business divestiture of overseas enterprises, which increasedthe recovery of overseas business speed and certainty; through continuous management improvement, domesticand foreign business has been fully restored and maintained a continuous positive growth trend and the company'soverall profit gradually increased. On the basis of years of mutual adaptation with overseas enterprises, thecompany has gradually strengthened the strategy of management output and cultural output, upgraded fromregional management to modular management, strengthened the cost control of overseas enterprises, promotedbusiness integration and market expansion, at the same time, take advantage of the Chinese engineer bonus, andfurther accelerate technology absorption and innovation. While maintaining the steady growth of traditionalbusinesses, the company continues to promote the growth of incremental businesses of air suspension systems,lightweight chassis systems, and fluid pipeline systems. Currently, the incremental business has a goodmomentum of development. The company will continue to focus on the core strategic goal of intelligent chassissystem, and promote the company's business to move towards intelligence. The company continued to rankamong the "Top 100 Global Auto Parts Industry" (ranked 95th).A. Intelligent Chassis system business-Air suspension system
a. Introduction of Products
Compare to coil spring suspension, air suspension system has the advantage that the Spring stiffness can beadjusted according to different usage scenario.Base on the different road conditions and the input from the heightand acceleration sensor, the ECU of ECAS system will identify the vehicle height change, the air height of airspring can be adjusted through the control the air compressor and valve block to realize the lift or lowering of thevehicle body.It can make the vehicle body more stable and improve the trafficability characteristic.The applicationof ECAS system can improve the comfort and the manoeuvrability of vehicle.The scope of ECAS includes aircompressor, ECU, sensors, air springs,etc.
b. Future Market potential
With the advent of the era of new energy vehicles, the appeal of new energy vehicles intelligent, whilechassis protection air suspension system is no longer the exclusive high-end models, because the new energyvehicle chassis system stability requirements are much higher than pure fuel vehicles, air suspension system hasgradually become the mainstream configuration of the new energy vehicle platform.
Leading voice intelligent system, intelligent air suspension system and excellent automatic driving functionare the core of current automobile intelligence.Tesla, NIO, Li Auto, Xiaopeng and other new emerging NEVmanufacturers are also equipped with these technologies and intelligent functions such as air suspensionsystems.With the further improvement of air suspension system technology and the improvement of car owners'recognition of the ultimate experience of air suspension products, more and more cars will be equipped with airsuspension systems to improve product superiority and customer satisfaction in the future.
In addition to the passenger car, developed countries in the vast majority of medium-sized passenger cars and
light commercial vehicles are used in the air suspension system, heavy truck in addition to the engineering carroad transport vehicle almost all use air suspension in China in 2018 effective GB7258 motor vehicle operationsafety technical conditions also require:"The rear axle of Dangerous goods transport trucks with a total massgreater than or equal to 12,000kg, all semi-trailers for transporting dangerous goods, as well as three-axle fencetype, warehouse grid type Semi-trailers should be equipped with air suspension."The air suspension system will gradually move from high-end to popular, and eventually become anindispensable part of cars, especially intelligent cars.
c. Company industry position and business promotionAMK Germany, as a high-end supplier of air suspension system, is one of the top three leaders in theindustry. Since entering the field of air suspension system business in the 1990s, it has continuously improved theproduct assembly technology, and has been deeply engaged in the industry for more than 20 years, supporting theworld's leading vehicle manufacturers such as Jaguar, Land Rover, Volvo, Audi, Benz, BMW etc.The domestic air suspension market is in its infancy, and AMK China has been accelerating the improvementof the performance and cost optimization of the air suspension system supply chain in the Chinese passenger carmarket. AMK continued to develop steadily around the strategic goals of "localization promotion, technologyiteration and upgrading, and industrial strengthening and completing". AMK China continues to promote theimplementation of other self-produced hardware projects while launching air supply unit product assembly andproduction lines in succession to increase the proportion of self-produced hardware.Business of AMK China hasmade breakthrough progress, and it has also obtained orders from many domestic new emerging manufacturersand leading vehicle manufacturers. Up to now, AMK China has received orders with a total output value of 7.839billion RMB, and it is expected to get more orders in the future, especially new energy vehicle orders.The company's subsidiary, Shanghai Dingyu Intelligent Technology Co., LTD, relies on the core advantagesof Anhui Zhongding Holding Group Co., LTD. in the field of rubber formulation, research and development,focusing on the research and development and production of air springs, and will actively promote technologicalbreakthroughs to further improve the performance of related products. At present, the production of air springproducts has been completed, the production line equipment has been landed, and the relevant businesscooperation is accelerating. At the same time, the company is also accelerating the development of other systemhardware assembly products.
B. Intelligent Chassis System Business-Lightweight chassis systema. Introduction of Products
Automotive metal parts are widely used in automotive chassis systems, including steering systems,suspension systems, braking systems and driving systems. The lightweight of automobiles has formed a broadconsensus in the automobile manufacturing industry. The lightweight of the chassis plays a vital role in theperformance of the whole vehicle. Lightweight chassis products such as aluminum alloy control arm assemblieshave high value per vehicle, it is a core parts of operational stability and comfortability.
b. Future market potential
Due to the needs of environmental protection and energy saving, the lightweight of automobiles has becomethe trend of automobile development in the world. The lightweight of automobiles is not only suitable fortraditional fuel vehicles, for new energy electric vehicles, it is also very important to reduce body weight andachieve vehicle lightweight, because it is related to the main battery life of new energy vehicles. Experimentshave shown that in terms of acceleration performance, it takes about 10 seconds for a 1.5-ton car to accelerate to aspeed of 60 kilometers per hour; if the weight is reduced by 25%, it can be reduced to 8 seconds.
Lightweight the chassis, the benefits in terms of fuel consumption, handling, etc. far exceed the lightweightof other components at the same level. The mass of most components on the chassis is unsprung weight.Relatively speaking, the mass of the body (structural parts, reinforcements parts and coverings parts) is sprungweight. It is generally believed that the effect of the same magnitude of unsprung weight reduction is 5-15 timesthat of the sprung weight reduction. At the same time, lightening the unsprung weight increases the ratio of thesprung mass to the unsprung weight, which is equivalent to the athlete removing the sandbag tied to the legs,which can significantly improve the response speed and comfort of the car during acceleration, braking andsteering.
c. Company industry position and business promotionIn recent years, the company has been vigorously developing chassis lightweight system assembly products,and the forged aluminum control arm assembly project has made breakthrough progress. At the same time, itssubsidiary Sichuan Wangjin Company, whose core technology is the ball joint assembly product, is the core safetycomponent and performance component of the chassis system. It has the world's leading technology and has avery high technical threshold.With the continuous advancement of the company's lightweight chasis system assembly business, it hasobtained orders from many traditional OEMs such as Mercedes-Benz, Changan, GAC, BYD, etc. At the sametime, it has made breakthroughs in the business of leading new energy enterprises and obtained relevant orders.C. Fluid pipeline systema. Introduction of ProductsGerman TFH, a subsidiary of the company, has been promoting R&D and production of thermal managementpipeline products. On the basis of supporting traditional thermal management pipelines, TFH vigorously promotesthe thermal management pipeline system assembly business of new energy vehicles, and actively expands theapplication of new materials in products. TFH vigorously develops the application of nylon pipes and TPVmaterials. Compared with traditional internal combustion engine pipes, the application of new technologies canmake products lighter in weight, lower in cost, and more flexible in assembly. In addition, it can maintain goodNVH and flexibility. With its innovative and technologically swift updating capabilities, TFH is able to respond tochanges in hybrid and fuel cell vehicles and is actively engaged in advanced development projects with severalOEMs customers.
b. Future market potentialAs the temperature control requirement for battery modules of the new energy vehicle is much higher thanthose of traditional vehicles, and also because of the absorption of TFH pipeline assembly technology, the singlevehicle value of the company fluid management products has increased from about RMB300 for traditional
vehicles to nearly RMB1,000 for new energy vehicles and even about RMB1,500 for Range Extend New Energyvehicles. With the development of new energy vehicles, the market for fluid piping systems is also expandingrapidly.
c. The company's industry status and business promotionThe company has been promoting the R&D and production of thermal management pipeline products formany years, and its subsidiary German TFH is just an excellent supplier of thermal management pipelineassembly products for engines and new energy vehicle batteries. TFH has the exclusive production technologycreatube process with independent patent and the core technology of TPV hose and nylon tube, which ranksamong the top two in the world in the industry segment. The company vigorously promotes the business ofthermal management pipeline system assembly for new energy vehicles, and currently it has been supplied toBMW, Volvo, Audi, Volkswagen, Geely, Xiaopeng and LI and other new energy vehicle platforms.TFH China has now completed the establishment and began to expand the domestic market. In the future, thedevelopment of cooling pipeline assembly business will be dominated by German TFH. The company's previousprojects have made great progress.In the future, it is expected to get more project designations, especially newenergy vehicle projects.
The company's subsidiary Zhongding Fluid leads the development of new energy temperature control systemassembly business, and actively distributes other thermal management products such as liquid cooling plates. Atpresent, the company is actively promoting the landing of related products, and will accelerate the layout oftemperature control system assembly field.D. Sealing SystemThe company’s subsidiaries, KACO GmbH + Co. KG in Germany, Cooper in the United States, andACUSHNET in the United States, have the top three sealing technologies in the world. KACO actively promotesthe portfolio for NEV on behalf of the companies under the sealing system, and has successfully developed andmatched new energy motor seals of high-performance. At the same time, the company has developed the mass-produced products for new energy battery module sealing systems and electric axle assemblies now, which aredelivered to NEV platforms of Volvo, NIO, SAIC, and GAC.The automotive sealing industry is a high-tech barrier industry with extremely high requirements forreliability. Dynamic seal has the most difficult technology in the sealing industry, especially the high-speed oilseal for new energy vehicle motors, which represents the most advanced technical level in the global sealingindustry. In recent years, the company has continued to increase the speed of business expansion, especially in the
American brand car and local brand customers, which has made great breakthroughs, and the industry marketshare has steadily increased.