The 2015 Annual Report of Changchai Company, Limited
CHANGCHAI COMPANY, LIMITED
THE 2015 ANNUAL REPORT
April 2016
The 2015 Annual Report of Changchai Company, Limited
Section I Important Statements, Contents & Terms
The Board of Directors, the Supervisory Committee as well as the 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 information, misleading
statements or material omissions. And they shall be jointly and severally liable for that.
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 carried in this Report is factual, accurate and complete.
All directors attended the board meeting for the review of this Report.
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.
The Company’s preliminary plan for profit distribution upon review and approval at the board
meeting: Based on the total shares of 561,374,326, a cash dividend of RMB0.23 (tax included) will
be distributed to all the shareholders for every 10 shares that they hold. No bonus shares will be
granted and no capital reserves will be turned into share capital.
This Report is prepared in both Chinese and English. Should there be any understanding
discrepancy between the two versions, the Chinese version shall prevail.
The 2015 Annual Report of Changchai Company, Limited
Contents
Section I Important Statements, Contents & Terms................................................................................................... 2
Section II Company Profile & Financial Highlights.................................................................................................. 5
Section III Business Profile ....................................................................................................................................... 8
Section IV Discussion & Analysis by the Management ............................................................................................ 9
Section V. Significant Events................................................................................................................................... 20
Section VI. Change in Shares & Shareholders ........................................................................................................ 28
Section VII. Preference Shares ................................................................................................................................ 32
Section VIII. Directors, Supervisors, Senior Management Staff & Employees ...................................................... 32
Section IX. Corporate Governance.......................................................................................................................... 36
Section X. Financial Report..................................................................................................................................... 41
Section XI. Documents Available for Reference ................................................................................................... 120
The 2015 Annual Report of Changchai Company, Limited
Terms
Term Refers to Specific meaning
Company, the Company,
Refers Changchai Company, Limited
Changchai
Changchai Benniu Refers Chuangzhou Changchai Benniu Diesel Engine Fittings Co., Ltd.
Changchai Wanzhou Refers Changchai Wanzhou Diesel Engine Co., Ltd.
Housheng Investment Refers Changzhou Housheng Investment Co., Ltd.
Housheng Agricultural
Refers Changzhou Changchai Housheng Agricultural Equipment Co., Ltd.
Equipment
Yuan, Ten thousand Yuan Refers RMB Yuan, RMB Ten thousand
Reporting period Refers 1 Jan. 2015-31 Dec. 2015
The 2015 Annual Report of Changchai Company, Limited
Section II Company Profile & Financial Highlights
I. Basic information of the Company
Stock abbr. Changchai A, Changchai B Stock code 000570, 200570
Stock abbr. after change (if any) No changes
Stock exchange Shenzhen Stock Exchange
Company name in Chinese 常柴股份有限公司
Abbr. of Company name in Chinese 苏常柴
Company name in English (if any) CHANGCHAI COMPANY, LIMITED
Abbr. of Company name in English (if any) CHANGCHAI CO., LTD.
Legal representative Xue Guojun
Registered address 123 Huaide Middle Road, Changzhou, Jiangsu, China
Zip code
Office address 123 Huaide Middle Road, Changzhou, Jiangsu, China
Zip code
Company website http://www.changchai.com.cn
Email address cctqm@public.cz.js.cn
II. Contact information
Company Secretary Securities Affairs Representative
Name Shi Jianchun He Jianjiang
123 Huaide Middle Road, Changzhou, 123 Huaide Middle Road, Changzhou,
Contact address
Jiangsu, China Jiangsu, China
Tel. (86)519-86610041 (86)519-68683155
Fax (86)519-86630954 (86)519-86630954
E-mail address ccsjc@changchai.com cchjj@changchai.com
III. About information disclosure and where this Report is placed
Newspapers designated by the Company for information disclosure Securities Times, Ta Kung Pao (HK)
Internet website designated by CSRC for disclosing this Report http://www.cninfo.com.cn
Where this Report is placed Board Secretariat
IV. Changes in the registered information
Organizational code 91320400134792410W
Changes in main business since listing (if any) No changes
Changes of controlling shareholder (if any) No changes
V. Other information
The CPAs firm hired by the Company
Name Jiangsu Gongzheng Tianye Certified Public Accountants LLP
Office address 10/F, Yingtong Commerce Building, Changzhou, Jiangsu, China
Signing accountants Wang Wenkai, He Taifeng
The 2015 Annual Report of Changchai Company, Limited
Sponsor engaged by the Company to conduct consistent supervision during the reporting period
□ Applicable √ Inapplicable
Financial consultant engaged by the Company to conduct consistent supervision during the reporting period
□ Applicable √ Inapplicable
VI. Accounting and financial highlights
Does the Company adjust retrospectively or restate the accounting data of previous years due to changes in the
accounting policy or correction of accounting errors?
□ Yes √ No
Increase/decrea
se of current
2015 2014
year over last
year
Operating revenues (RMB Yuan) 2,519,799,547.29 2,489,792,063.33 1.21% 2,927,593,052.78
Net profits attributable to
shareholders of the Company (RMB 71,102,792.49 64,202,144.29 10.75% 75,712,361.04
Yuan)
Net profits attributable to
shareholders of the Company after
61,588,462.29 58,685,034.57 4.95% 71,950,142.51
extraordinary gains and losses (RMB
Yuan)
Net cash flows from operating
127,926,882.95 -51,507,355.52 —— 31,406,848.48
activities (RMB Yuan)
Basic EPS (RMB Yuan/share) 0.13 0.11 18.18% 0.13
Diluted EPS (RMB Yuan/share) 0.13 0.11 18.18% 0.13
Weighted average ROE (%) 3.53% 3.28% 0.25% 4.14%
Increase/decrea
As at 31 Dec. As at 31 Dec. se of current As at 31 Dec.
2015 2014 year-end than 2013
last year-end
Total assets (RMB Yuan) 3,232,406,102.20 3,166,783,758.18 2.07% 3,082,340,149.65
Net assets attributable to
shareholders of the Company (RMB 2,002,910,311.01 1,936,936,835.27 3.41% 1,809,577,062.45
Yuan)
VII. Differences of the accounting data under the domestic and the overseas accounting
standards
1. Differences of the net profits and the net assets disclosed in the financial reports prepared under the
international and the Chinese accounting standards
□ Applicable √ Inapplicable
No such differences for the reporting period.
2. Differences of the net profits and the net assets disclosed in the financial reports prepared under the
overseas and the Chinese accounting standards
□ Applicable √ Inapplicable
No such differences for the reporting period.
The 2015 Annual Report of Changchai Company, Limited
VIII. Financial highlights by quarter
Unit: RMB Yuan
Q1 Q2 Q3 Q4
Operating revenues 650,305,530.50 709,590,370.19 815,273,308.97 344,630,337.63
Net profits attributable to shareholders of
17,279,138.61 20,284,260.57 36,184,587.95 -2,645,194.64
the Company
Net profits attributable to shareholders of
the Company after extraordinary gains and 15,137,500.97 20,573,118.31 35,546,486.10 -9,668,643.09
losses
Net cash flows from operating activities 1,795,087.91 44,932,653.21 48,916,342.35 32,282,799.48
Any material differences between the financial indicators above or their summations and those which have been
disclosed in quarterly or semi-annual reports?
□ Yes √ No
IX. Extraordinary gains and losses
√ Applicable □ Inapplicable
Unit: RMB Yuan
Item 2015 2014 2013 Note
Gains/losses on disposal of non-current assets
(including offset amount of asset impairment 211,929.61 118,901.99 568,054.78
provisions)
Governmental grants recorded into current gains and
losses (excluding those closely related to business of
11,903,636.62 10,344,073.62 2,022,736.01
the Company and granted at certain quotas or amounts
according to government’s standards)
Capital occupation charges on non-financial
enterprises that are recorded into current gains and 1,523,155.52 1,505,666.68 2,224,950.00
losses
Gains and losses on fair value changes of transactional
financial assets and liabilities & investment gains on
disposal of transactional financial assets and liabilities
1,793,021.58 572,812.70 439,841.66
as well as financial assets available for sale, except for
effective hedging related to normal business of the
Company
Impairment provision reversal for accounts receivable
1,879,038.74
on which impairment test is carried out separately
Non-operating income and expense other than above -4,109,778.32 -6,029,012.72 -1,918,603.81
Less: Income tax effects 1,747,894.80 995,341.14 1,236,496.89
Minority interests effects (after tax) 59,740.01 -8.59 217,301.96
Total 9,514,330.20 5,517,109.72 3,762,218.53 --
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 √ Inapplicable
No such cases in the reporting period.
The 2015 Annual Report of Changchai Company, Limited
Section III Business Profile
I. Main business during 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, cereal harvesting machinery, 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.
II. Significant changes in the main assets
1. Significant changes in the main assets
Main asset Reason for any significant change
Closing amount at RMB498,502,274.42, up 58.64% from opening
Notes receivable amount, mainly because the Company enhanced payment collection and
adopted notes more often for settlement with customers
Closing amount at RMB5,622,539.81, down 35.09% from opening
Other receivables amount, mainly because subsidiary Changchai Wanzhou recovered
guarantee deposit of RMB2 million in current period
Net closing amount at RMB60,304,691.41, up 90.06% from opening
Other current assets amount, mainly because of bank financial products purchased by the
Company in current period
2. Main assets overseas
□ Applicable √ Inapplicable
III. 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
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, reviewed and approved by AQSIQ, the Company
produced for export had gained the qualification of exemption. 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 was honorably ranked among “the Demonstration Chinese Enterprises
in Export Quality and Safety”, was selected in “the Top One Hundred Chinese Enterprises in Engineering
Industry”, won as the leading brand in agricultural machinery industry in “Jing Geng” competition, and the
Company’s well-selling products, the 4G33TC, 3M78 and 4H11, respectively won the golden award among the
annual products in Chinese engineering industry, the golden award among accessories in Chinese agricultural
machinery, and the innovation award. For decades, the Company developed in a sound manner and cultivated the
The 2015 Annual Report of Changchai Company, Limited
“Changchai” brand, a famous small diesel engine brand of China with independent intellectual property rights
2. Product advantage
Currently, the Company is mainly engaged in small power single-cylinder and multi-cylinder diesel engines.
It has a complete product range, a wide power level coverage, a high reputation and intellectual property rights for
its main products. It owns a state-level technical center, a post doctoral scientific research station and Jiangsu
Small-and Medium-Power Internal Combustion Engine Engineering Research Center. Quite a few of its
multi-cylinder diesel engines have passed the European Union EC certification and the America EPA certification.
Besides, it has the capability to develop and put into pass production products meeting the national emission
standard IV.
3. Sales network advantage
The Company has built up a sales service network covering the whole country. With 11 marketing units, 31
sales service centers, over 400 service locations and 600 cooperation maintenance stations, the service network
covering the major cities and the countryside, the Company is able to provide quality, efficient and timely services
for its customers.
Section IV Discussion & Analysis by the Management
I. Summary
In 2015, in face of multiple unfavorable factors such as the slowing-down macro-economy, a continuous
decrease in the gross output and sales volume in the diesel engine industry as well as the mounting pressure on
production safety and environmental protection, we carefully analyzed the market situation, beefed up the
adjustment to our product mix by various means, and seized opportunities in the domestic and overseas markets.
We also kept improving our equipment capability, increased the quality of our employees, strictly controlled our
product quality and enhanced management. As a result, we were able to deliver a good business performance,
which has further solidified our position in the diesel engine industry.
