2016 Semi-annual Report of Changchai Company, Limited
CHANGCHAI COMPANY, LIMITED
2016 SEMI-ANNUAL REPORT
18 August 2016
2016 Semi-annual Report of Changchai Company, Limited
Section I Important Reminders, Contents & Definition
The Board of Directors, the Supervisory Committee as well as all directors, supervisors and senior
management staff of Changchai Company, Limited (hereinafter referred to as “the Company”)
warrant that this report is factual, accurate and complete without any false record, misleading
statement or material omission. And they shall be jointly and severally liable for that.
All directors attended the board session for reviewing this report.
The Company plans not to distribute cash dividends or bonus shares or turn capital reserve into
share capital.
Mr. Xue Guojun, company principal, Mr. He Jianguang, chief of the accounting work, and Mr. Jiang
He, chief of the accounting organ (chief of accounting), hereby confirm that the Financial Report
enclosed in this report is factual, accurate and complete.
The future plans and some other forward-looking statements carried in this report shall not be
considered as virtual promises of the Company to investors. And investors are kindly reminded to
pay attention to possible risks.
This report is prepared in both Chinese and English. Should there be any understanding discrepancy
between the two versions, the Chinese version shall prevail.
2016 Semi-annual Report of Changchai Company, Limited
Contents
Section I Important Reminders, Contents & Definition ......................................................................2
Section II Company Profile..................................................................................................................5
Section III Highlights of Accounting Data & Financial Indicators .....................................................7
Section IV Report of the Board of Directors .......................................................................................9
Section V Significant Events .............................................................................................................18
Section VI Change in Shares & Shareholders ...................................................................................26
Section VII Preference Shares ...........................................................................................................30
Section VIII Directors, Supervisors & Senior Management Staff .....................................................30
Section IX Financial Report...............................................................................................................31
Section X Documents Available for Reference................................................................................125
2016 Semi-annual Report of Changchai Company, Limited
Definition
Refers
Term Definition
to
Refers
Company, the Company, Changchai Changchai Company, Limited
to
Refers Chuangzhou Changchai Benniu Diesel Engine Fittings Co.,
Changchai Benniu
to Ltd.
Refers
Changchai Wanzhou Changchai Wanzhou Diesel Engine Co., Ltd
to
Refers
Housheng Investment Changzhou Housheng Investment Co., Ltd.
to
Refers Changzhou Changchai Housheng Agricultural Equipment Co.,
Housheng Agricultural Equipment
to Ltd.
Changchai Robin Refers Changzhou Fuji Changchai Robin Gasoline Engine Co., Ltd.
Refers
Yuan, Ten thousand Yuan RMB, RMB Ten thousand
to
Refers
Reporting Period 1 January 2016-30 June 2016
to
2016 Semi-annual Report of Changchai Company, Limited
Section II Company Profile
I Basic information about the Company
Stock name Changchai A, Changchai B Stock code 000570, 200570
Stock exchange Shenzhen Stock Exchange
Company name in
常柴股份有限公司
Chinese
Abbreviation 苏常柴
Company name in
CHANGCHAI COMPANY,LIMITED
English
Abbreviation CHANGCHAI CO.,LTD.
Legal representative Xue Guojun
II Contact information
Board Secretary Securities Representative
Name Shi Jianchun He Jianjiang
123 Huaide Middle Road, 123 Huaide Middle Road,
Address
Changzhou, Jiangsu, China Changzhou, Jiangsu, China
Tel. (86)519-86610041 (86)519-68683155
Fax (86)519-86630954 (86)519-86630954
E-mail ccsjc@changchai.com cchjj@changchai.com
III Other information
1. Ways to contact the Company
Did any change occur to the registered address, office address and their postal codes, website address and email
address of the Company during the Reporting Period?
□ Applicable √ Not applicable
The registered address, office address and their postal codes, website address and email address of the Company
did not change during the reporting period. The said information can be found in the 2015 Annual Report.
2016 Semi-annual Report of Changchai Company, Limited
2. About information disclosure and where this report is placed
Did any change occur to information disclosure media and where this report is placed during the Reporting
Period?
□ Applicable √ Not applicable
The newspapers designated by the Company for information disclosure, the website designated by CSRC for
disclosing this report and the location where this report is placed did not change during the Reporting Period. The
said information can be found in the 2015 Annual Report.
3. Change of the registered information
Did any change occur to the registered information during the reporting period?
□ Applicable √ Not applicable
The registration date and place of the Company, its business license No., taxation registration No. and
organizational code did not change during the Reporting Period. The said information can be found in the 2015
Annual Report.
2016 Semi-annual Report of Changchai Company, Limited
Section III Highlights of Accounting Data & Financial Indicators
I Major accounting data and financial indicators
Does the Company adjust retrospectively or restate accounting data of previous years due to change of any
accounting policy or correction of any accounting error?
□ Yes √ No
Reporting period Same period of last year +/- (%)
Operating revenues (RMB) 1,163,660,721.69 1,359,895,900.69 -14.43%
Net profit attributable to shareholders
35,018,142.36 37,563,399.18 -6.78%
of the Company (RMB)
Net profit attributable to shareholders
of the Company after excluding 28,510,501.61 35,710,619.28 -20.16%
extraordinary gains and losses (RMB)
Net cash flows from operating
118,035,913.29 46,727,741.12 152.60%
activities (RMB)
Basic EPS (RMB/share) 0.06 0.07 -14.29%
Diluted EPS (RMB/share) 0.06 0.07 -14.29%
Weighted average ROE (%) 1.76% 1.85% -0.09%
As at the end of the
As at the end of last year +/- (%)
reporting period
Total assets (RMB) 3,204,416,788.95 3,232,406,102.20 -0.87%
Net assets attributable to shareholders
1,975,255,293.87 2,002,910,311.01 -1.38%
of the Company (RMB)
II Differences between accounting data under domestic and overseas accounting standards
1. Differences of net profit and net assets disclosed in financial reports prepared under international and
Chinese accounting standards
□ Applicable √ Not applicable
No difference.
2. Differences of net profit and net assets disclosed in financial reports prepared under overseas and
Chinese accounting standards
□ Applicable √ Not applicable
No difference.
2016 Semi-annual Report of Changchai Company, Limited
3. Explain reasons for the differences between accounting data under domestic and overseas accounting
standards
□ Applicable √ Not applicable
III Items and amounts of extraordinary gains and losses
√ Applicable □ Not applicable
Unit: RMB
Item Amount Explanation
Gains/losses on the disposal of non-current assets (including the
6,113,117.21
offset part of asset impairment provisions)
Government grants recognized in the current period, except for
those acquired in the ordinary course of business or granted at
3,787,728.09
certain quotas or amounts according to the country’s unified
standards
Gains and losses on change in fair value from tradable financial
assets and tradable financial liabilities, as well as investment
income from disposal of tradable financial assets and tradable
1,205,730.87
financial liabilities and financial assets available for sales except
for effective hedging related with normal businesses of the
Company
Non-operating income and expenses other than the above -3,412,491.97
Less: Income tax effects 986,443.45
Minority interests effects (after tax) 200,000.00
Total 6,507,640.75
Explain the reasons if the Company classifies an item as an extraordinary gain/loss according to the definition in
the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the
Public—Extraordinary Gains and Losses, or classifies any extraordinary gain/loss item mentioned in the said
explanatory announcement as a recurrent gain/loss item
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2016 Semi-annual Report of Changchai Company, Limited
Section IV Report of the Board of Directors
I Overview
For the first half of 2016, we sold 376,100 units of diesel engines and generator sets, down 22.79% over the same
period of last year. We achieved a sales income of RMB1,163,660,700, down 14.43% from the same period of last
year. And the net profit attributable to our shareholders stood at RMB35.0181 million, down 6.78% on a
year-on-year basis.
The reporting period saw a drop in production and consumption of diesel engines as well as fierce competition in
the industry due to more downward pressure on the macro-economy and weak market demand for combustion
engines. In face of the unfavorable factor of oversupply in the single-cylinder diesel engine market, we managed
to keep our leading position in sales through upgrading products, improving our marketing network, stabilizing
our supporting plants, etc.. As for our multi-cylinder diesel engines, we have achieved remarkable results with our
product structure after years of improvement. Our multi-cylinder diesel engines with more technological contents
and higher added value have started mass production, and the new products have also begun small-lot production.
As a result, multi-cylinder diesel engines took up a larger proportion in our total sales income.
In general, despite the decreased sales revenue and net profit in the first half of 2016, our development momentum
is still considered positive.
II Main business analysis
YoY change of major financial data:
Unit: RMB
Same period of last Main reasons for
Reporting period YoY +/- %
year change
Operating revenues 1,163,660,721.69 1,359,895,900.69 -14.43%
Operating costs 984,594,264.43 1,179,073,102.73 -16.49%
Selling expenses 59,518,474.60 58,059,098.92 2.51%
Administrative
78,488,615.70 84,401,024.18 -7.01%
expenses
Financial costs -4,811,135.29 -6,673,703.74 ——
Income tax expenses 6,581,748.12 7,503,443.33 -12.28%
R&D inputs 36,683,008.45 35,771,589.22 2.55%
2016 Semi-annual Report of Changchai Company, Limited
Net cash flows from
118,035,913.29 46,727,741.12 152.60%
operating activities
Net cash flows from
-29,436,822.72 -65,286,749.02 ——
investing activities
Net cash flows from
-20,380,965.42 -17,079,395.46 ——
financing activities
Net increase in cash
68,218,125.15 -35,638,403.36 ——
and cash equivalents
Major changes to the profit structure or sources of the Company during the Reporting Period;
□ Applicable √ Not applicable
No major changes occurred to the profit structure or sources of the Company during the Reporting Period.
Reporting period progress of the future development planning in the disclosed documents of the Company such as
share-soliciting prospectuses, offering prospectuses, asset reorganization reports, etc.:
□ Applicable √ Not applicable
No such situation of the Company during the Reporting Period.
Overview of the reporting period progress of the business plans disclosed in previous periods:
The progress of the business plans of Y2016 that disclosed in the 2015 annual report was normal during the
reporting period.
III. Breakdown of main business
Unit: RMB
Increase/decrease
Increase/decrease Increase/decrease
Gross profit of operating
Operating revenues Operating costs of operating costs of gross profit
rate revenues over last
over last year rate over last year
year
Classified by industry
Internal
combustion 1,152,656,941.95 976,226,687.99 15.31% -14.65% -16.80% 2.19%
engine
Other
Classified by product
Diesel engines 1,152,656,941.95 976,226,687.99 15.31% -14.65% -16.80% 2.19%
Classified by region
Domestic 1,046,828,931.10 873,404,875.20 16.57% -15.94% -18.50% 2.62%
Overseas 105,828,010.85 102,914,223.93 2.75% 0.68% 1.14% -0.45%
IV. Core competitiveness analysis
1. Brand advantage
Incorporated in 1913, the Company has a history over 100 years, with its diesel engines well received both at
2016 Semi-annual Report of Changchai Company, Limited
home and abroad.
The trademark of “Changchai” was the first among the production goods in the country to be recognized as a
“Famous Trademark of China”. In 2005, the single-cylinder diesel engines of the Company were among the first
to be titled as “Brandname Products of China”. In 2013, through the review and approval of General
Administration of Quality Supervision, Inspection and Quarantine of the People’s Republic of China, the diesel
engine products of the Company gained the export inspection-free qualification. In 2014, Changchai was awarded
the honorary title of “Y2012-Y2013 State-level Enterprise of Observing Contracts and Keeping Promise” and had
been awarded the title of “China Pacesetter Enterprise of Internal Combustion Engine and Accessories
Manufacturing Industry” for five years in a row. In 2015, the Company listed in the “China Export Quality and
Safety Demonstration Enterprises” with proud and be selected as the “Hundred Companies of the China
Machinery Industry” that be awarded as the “Precision Farming Cup” among the national agricultural machinery
industry brands as well as the products of the Company such as the 4G33TC, 3M78, 4H11 was respectively
awarded the gold award of the China Agricultural Machinery Industry Annual Product, gold award and innovation
award of China Agricultural Machinery Parts. For decades, the Company developed in a sound manner and
cultivated the “Changchai” brand, a famou
