1、 1 Changchai Company,Limited First Quarterly Report 2002 Important:Board of Directors of the Changchai Company,Limited(hereinafter referred to as the Company)individually and collectively accept responsibility for the correctness,accuracy and completeness of the contents of this report and confirm t
2、hat there are no material omissions nor errors which would render any statement misleading.This quarterly report is written both in Chinese and English.Should there be any difference in interpretation of the text of the two versions,the Chinese version shall prevail.Due to business engagement,Direct
3、or Mr.Li Hanhua,Mr.Wang Jiaze and Mr.Xu Zhenping were absent from the meeting,Mr.Li Hanhua trusted Chairman of the Board Mr.Zhang Junyuan to vote on his behalf.The Quarterly Financial Report of the Company has not been audited.I.COMPANY PROFILE 1.Legal Name of the Company In Chinese:常柴股份有限公司 In Engl
4、ish:CHANGCHAI COMPANY,LIMITED Abbr.:CHANGCHAI CO.,LTD.2.Legal Representative:Mr.Zhang Junyuan 3.Secretary of the Board of Directors:Mr.Zhang Jianhe Liaison Address:No.123,Huaide Middle Rd.,Changzhou,Jiangsu,China Tel:(86)519-6600448 Fax:(86)519-6630954 E-mail:4.Registered Address and Office Address:
5、No.123,Huaide Middle Rd.,Changzhou,Jiangsu,China Post Code:213002 Internet Website:http:/E-mail:5.Newspapers Chosen for Disclosing Information:Securities Times and Ta Kung Pao The Place Where the Annual Report is Prepared and Placed:Office of the Company Internet Website Designated by CSRC for Publi
6、shing the Quarterly Report of the Company:http:/2 6.Stock Exchange Listed with:Shenzhen Stock Exchange Short Form of the Stock:Suchangchai A Stock Code:000570 Suchangchai B 200570 II.REVIEW AND OUTLOOK OF MANAGEMENT 1.Management Status in the Report Year In the 1st quarter of 2002,there was no big c
7、hange on the market of small diesels.However,the competition was still very drastic and sales price kept on dropping.Through internal efforts,the Company realized profit in the report period.The sales income realized in the 1st quarter was RMB 418,103,400,a decrease of 10.84%below that of last year
8、for the period;The net profit realized was RMB 1,211,500,a decrease of 66.22%below that of last year for the period.2.Progress of Major Investment Projects in the Report period(1)Application of funds raised in 1999 by March 31,2002 is as follows:(Unit:RMB000)Names of items Fixed assets input(Equity
9、rights investment)Auxiliary current funds input(Loans)Total Progress Back-carried all-feeding combines Self-propelled all-feeding combines 29100 3000 5910 Completed Self-propelled semi-feeding combines 24900 47870 72770 Basically Completed Total 54000 77870 131870(2)Remarks on input of raised funds:
10、The Company increased RMB 460,000 of initial development input in self-propelled semi-feeding combines in the 1st quarter.Totally RMB 131,870,000 of raised funds were used,and RMB 62,840,000 of raised funds was deposited in the bank.It was estimated that RMB 19,540,000 more of current funds needed t
11、o be input in self-propelled semi-feeding combines.Seeing that the equity right investment and loans for current funds for the three combine projects had all been used up,the 15th Meeting of the 3rd Board of Directors decided to supplement the current funds with RMB 43,300,000 of surplus raised fund
12、s.The resolution is subject to approval by the Shareholders General Meeting.3.Business Results and the Financial Status at the End of Report Period(1)Business results:Table A:(Unit:RMB000)Item Fr.Jan.to Mar.of 2002 Fr.Jan.to Mar.of 2001+/-(%)Income of main business lines 418,103.40 468,929.80-10.84
13、Profit of main business lines 51,213.40 72,591.00-29.45 Net profit 1,211.50 3,586.60-66.22 3 Table B:(Unit:RMB000)Fr.Jan.to Mar.of 2002 Fr.Jan.to Mar.of 2001 Item Sum of money Proportion in total profit Sum of money Proportion in total profit+/-(%)Profit of main business lines 51,213.40-1631.00%72,5
14、91.00-5599.86%-29.45 Profit of other businesses 6,786.70-216.14%3,871.60-298.67%75.29 Period expenses 60,336.90-1921.56%77,987.00-6016.12%-22.63 Investment earnings 510.10-16.25%1,475.30-113.81%-65.42 Subsidy income 11.60-0.37%338.60-26.12%-96.57 Non-operating net income&expenditure-1,324.90 42.19%-
15、1,585.90 122.34%-16.46 Reasons for change:1.The profit of main business lines decreased in the report period,mainly because the sales volume and sales price decreased compared with those of last year for the period;2.The profit of other businesses increased mainly because of increase in sales of mat
16、erials and spare parts;3.The period expenses decreased mainly because of decrease in promotion fees;4.The investment earnings decreased,mainly because the earnings of investment dividends decreased;5.The subsidy income decreased,because the subsidies obtained by the Companys subsidiary companies dec
17、reased.(2)Financial status:(Unit:RMB000)By March 31,2002 By December 31,2001 Item Sum of money Proportion in total assets Sum of money Proportion in total assets+/-(%)Monetary funds 331,157.50 11.42%323,873.10 11.07%2.25%Account receivables 1,126,670.80 38.86%1,048,800.50 35.84%7.42%Other account re
18、ceivables 312,435.10 10.78%317,407.10 10.85%-1.57%Inventories 405,278.70 13.98%489,426.80 16.72%-17.19%Net fixed assets 606,687.10 20.93%614,153.90 20.99%-1.22%Changchai Group Co.,Ltd.owed arrears to the Company for the correlative transaction taken between them.As discussed in the 6th Meeting of th
19、e 3rd Board of Directors,it was agreed to offset the aforesaid arrears with Changchai Building.On March 28,2002,the two parties signed a formal agreement on transferring the Building at the assessment price of RMB 100,036,000.The ownership of Changchai Building has been processed.(3)Possible Events
20、and After Period Events a.In the report year,the Company had no material lawsuit or arbitration events;b.In the report year,the Company hadnt offered guarantee to any other party;c.In the report year,there was no significant after balance sheet event.(4)Significant impact from changes of production
21、and management environment on the Companys financial status and business results:4 Since in the 1st quarter of 2002,the condition of drastic competition on the small diesel market hadnt changed much and the sales price continually declined,there was no remarkable improvement in the profit making cap
22、ability of the Company and the controlling subsidiaries.In the report period,the Company realized RMB 1,211,500 of net profit,a 66.22%decrease below that of the last year for the same period.According to the market condition of diesel engines and terminal products as well as the development trend in
23、 2002,the Company estimated that it would still be in the situation of very little profit in mid-2002.(5)Arthur Anderson Certified Public Accountants issued an auditors report carried with explanatory remarks in 2001.The Companys solutions made in the 1st quarter of 2002 for relevant issues are as f
24、ollows:The Board of Directors,the Supervisory Committee,management as well as the municipal governor attached high importance towards the huge losses that the Company suffered in 2001,and studied reforming plans and concrete measures for eliminating losses and increasing profits over and over again.
25、In light of the Companys situation,the Company summarized historical experience and lessons seriously,and sough existence through reforming and development through adjustment.The Company mainly adopted the following strategies:a.The Company improved legal person administrative structure and standard
26、ized operation.In light of a series of regulations promulgated by the supervision and administration authority for standardizing operation of listed company,the Company amended Articles of Association,established Rules of Procedures of the Shareholders General Meeting,Rules of Procedures of the Boar
27、d of Directors,Rules of Procedures of the Supervisory Committee,revised Detailed Work Rules for General Manager,established independent director system,improved information disclosure system,administration system of raised capital,and decision-making system of correlative transactions,clarified the
28、authorization contents as well as examination and approval limitation to the Board of Directors and general manager,established detailed implementation rules for payroll and evaluation committee and detailed implementation rules for auditing committee.The Company shall finish adjusting Board members
29、 and electing independent directors in the first half of the year.Pursuant to statutory procedures,the Company adjusted the structure of members of the Board of Directors,enhanced the scientific decision-making capability of the Board and decision-making efficiency,further clarified the functions of
30、 the“Three Meetings”,and promoted the standardized operation of administrative structure.b.The Company expedited adjustment of products structure and cultivated new point of economic growth.Firstly,the Company adjusted the concept of developing diversified products,focus on limited resources,strengt
31、hen impetus,and enhance main business lines.Secondly,the Company took full advantage of the existing product recourses,tried hard to dig out potentials of auxiliary products and developed market shares.Thirdly,the Company introduced diesels for construction use that are advanced in technology and 5
32、have broad market potential and promoted development of multi-cylinder engine through joint ownership and cooperation.c.The Company integrated resources,raised efficiency and benefits.Firstly,the Company liquidated and consolidated the outside investment projects in an all-around way and implemented
33、 orderly shrinkage.Meanwhile,the Company positively strived for support of the government,gradually reclaimed relevant companies arrears,vitalized the Companys stock assets,and solved relevant historical carry-over problems.Secondly,the Company deepened its internal reform,reduced costs and increase
34、d efficiency.The Company adjusted the organization,fixed posts and staffs,and distributed surplus staffs;The staffs took positions in a competitive way,practiced survival of the fittest,enhanced quality of cadres and employees;The Company separated its social functions so as to lighten its burden.Th
35、irdly,the Company positively pushed the reforming of distribution system so that remuneration of labor could be better linked with achievement and contribution,and promoted the Companys innovation capability through transform of mechanism.The Company further adjusted the distribution policies of the
36、 two sectors,the sales company and the product development department so as to better mobilize employees enthusiasm.The Company established the salary and assessment committee of the Board of Directors and auditing committee,reflected upon encouragement mechanism for managers,technical and business
37、cadremen,pulled away distribution grades and disparity on the basis of reinforcement of assessment.Fourthly,the Company learned from famous enterprises with their successful experience,updated concepts,reinforced management of human resources and enhanced administration level so as to fulfill the de
38、velopment need of the Company.d.The Company strengthened its management and promoted sustained and stable development.Firstly,the Company expedited marketablization of traditional products.The Company promoted internal marketablization by means of monopoly operation,beneficial sales,driving costs fr
39、om backward;Adjusted and improved each internal management centering in cost so that the cost of single cylinder could be close to the average market cost;Mass-produced multi cylinder engines aiming at making profits.The Company implemented parity purchase considering quality and price for homemade
40、spare parts,and made internal adjustment according to price rule for those that really couldnt be linked with market prices.The Company kept on implementing budget system and strict examination for various expense,and ensured that the parent company could eliminate losses and increase profits under
41、the control of cost system.Thirdly,the Company established and improved risk control system,ascertained functions and responsibilities,studied strategies in time and put measures into effect.III.Financial Report 1.The first quarterly financial report 2002 has not been audited.2.Accounting Statement
42、6 Company:Changchai Company,Limited Brief Consolidated Balance Sheet Unit:In RMB000 Items Amount at the year-begin Amount at the report period Item Amount at the year-begin Amount at the report period Current assets 1,917,650.40 1,880,714.30 Current liabilities 1,322,747.00 1,296,426.40 Long-term in
43、vestment 193,021.40 190,114.60 Long-term liabilities 318,323.20 318,323.20 Net fixed assets 614,153.90 606,687.10 Minority shareholders interest 46,013.40 47,154.60 Intangible assets and other assets 88,649.40 98,140.10 Shareholders equity 1,239,420.60 1,237,207.50 Total assets 2,926,504.10 2,899,11
44、1.70 Liabilities and shareholders equity 2,926,504.10 2,899,111.70 Company:Changchai Company,Limited Brief Consolidated Statement of profit Unit:In RMB000 Items Report period From the begin of the year to the end of report period Income from main business lines 418,103.40 418,103.40 Profit from main
45、 business lines 51,213.40 51,213.40 Profit from other business lines 6,786.70 6,786.70 Expenses in the first quarterly 60,336.90 60,336.90 Investment income 510.10 510.10 Net income/expenditure from non-operating-1,324.90-1,324.90 Income taxes 28.20 28.20 Net profit 1,211.50 1,211.50 3.Notes to the
46、financial statement:(1)In the first quarter of 2002,there were no material changes in the accounting policies,accounting estimates or consolidation scope of financial statement.(2)There is no unconsolidated subsidiary company,which needs to be brought into the consolidation scope of financial statem
47、ent of the Company.IV.Documents available for Reference 1.Original of the First Quarterly Report 2002 carried with the personal signatures of Chairman of the Board;2.Financial statements carried with the personal signatures and seals of legal representative,person in charge of the financial affairs and person in charge of handling accounting affairs.Board of Directors of Changchai Company,Limited April 24,2002