EX-99.2 3 d701966dex992.htm EX-99.2

EX-99.2

Exhibit 99.2

CHINA YUCHAI INTERNATIONAL LIMITED

UNAUDITED CONSOLIDATED INCOME STATEMENTS

For the quarters ended December 31, 2018 and 2017

(RMB and US$ amounts expressed in thousands, except per share data)

		December 31, 2018								December 31, 2017
		RMB ’000				US$ ’000				RMB ’000				US$ ’000
										Restated				Restated
Revenue			4,532,178				660,359				3,786,352				551,689
Cost of goods sold			(3,670,367	)			(534,789	)			(2,735,790	)			(398,617	)
Gross profit			861,811				125,570				1,050,562				153,072
Other operating income, net			64,359				9,377				370,561				53,992
Research and development costs			(107,677	)			(15,689	)			(230,984	)			(33,655	)
Selling, distribution and administrative costs			(485,846	)			(70,790	)			(548,453	)			(79,912	)
Operating profit			332,647				48,468				641,686				93,497
Finance costs			(31,090	)			(4,530	)			(24,521	)			(3,573	)
Share of results of associates and joint ventures			(2,999	)			(437	)			(732	)			(107	)
Profit before tax			298,558				43,501				616,433				89,817
Income tax expense			(28,364	)			(4,133	)			(28,154	)			(4,102	)
Profit for the period			270,194				39,368				588,279				85,715
Attributable to:
Equity holders of the parent			191,782				27,944				348,558				50,787
Non-controlling interests			78,412				11,424				239,721				34,928
			270,194				39,368				588,279				85,715
Net earnings per common share
- Basic			4.69				0.68				8.54				1.24
- Diluted			4.69				0.68				8.52				1.24
Unit sales			93,881								73,610

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CHINA YUCHAI INTERNATIONAL LIMITED

UNAUDITED CONSOLIDATED INCOME STATEMENTS

For the years ended December 31, 2018 and 2017

(RMB and US$ amounts expressed in thousands, except per share data)

		December 31, 2018								December 31, 2017
		RMB ’000				US$ ’000				RMB ’000				US$ ’000
										Restated				Restated
Revenue			16,263,248				2,369,630				16,197,819				2,360,097
Cost of goods sold			(13,171,227	)			(1,919,109	)			(12,841,768	)			(1,871,105	)
Gross profit			3,092,021				450,521				3,356,051				488,992
Other operating income, net			192,680				28,074				509,397				74,222
Research and development costs			(447,668	)			(65,227	)			(608,181	)			(88,615	)
Selling, distribution and administrative costs			(1,554,512	)			(226,500	)			(1,652,856	)			(240,829	)
Operating profit			1,282,521				186,868				1,604,411				233,770
Finance costs			(113,088	)			(16,477	)			(100,439	)			(14,634	)
Share of results of associates and joint ventures			11,634				1,695				10,054				1,465
Profit before tax			1,181,067				172,086				1,514,026				220,601
Income tax expense			(206,667	)			(30,112	)			(194,173	)			(28,292	)
Profit for the period			974,400				141,974				1,319,853				192,309
Attributable to:
Equity holders of the parent			695,266				101,303				888,807				129,504
Non-controlling interests			279,134				40,671				431,046				62,805
			974,400				141,974				1,319,853				192,309
Net earnings per common share
- Basic			17.02				2.48				21.80				3.18
- Diluted			17.02				2.48				21.80				3.18
Unit sales			375,731								367,097

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CHINA YUCHAI INTERNATIONAL LIMITED

SELECTED UNAUDITED CONSOLIDATED BALANCE SHEET ITEMS

For the years ended December 31, 2018 and 2017

(RMB and US$ amounts expressed in thousands)

		As of December 31, 2018								As of December 31, 2017 (Audited)
		RMB ’000				US$ ’000				RMB ’000
										Restated
Cash and bank balances			6,128,521				892,954				6,029,207
Trade and bills receivables			7,389,105				1,076,627				7,031,544
Inventories			2,517,864				366,864				2,572,745
Trade and bills payables			4,560,628				664,505				5,177,123
Short-term and long-term loans and borrowings			2,016,092				293,754				1,626,341
Equity attributable to equity holders of the parent			8,395,870				1,223,317				8,334,289

Non-IFRS Financial Measures

This press release makes reference to certain non-IFRS measures. Management uses these non-IFRS financial measures for purposes of comparison to prior periods and development of future projections and earnings growth prospects. This information is also used by management to measure the profitability of ongoing operations and in analyzing the Company’s business performance and trends. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company’s results of operations from management’s perspective. Accordingly, they should not be considered in isolation nor as a substitute for analysis of the Company’s financial information reported under IFRS.

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Non-IFRS Financial Measures

To supplement our consolidated financial statements, we provide the following additional information on the adjustments:

UNAUDITED Reconciliation of adjusted restated net profit for the quarter ended December 31, 2017

(RMB and US$ amounts expressed in thousands, except per share data)

		Quarter Ended December 31, 2017
		RMB ’000				US$ ’000
Net profit			665,882				97,022
Adjustment arising from adoption of IFRS 15			(77,603	)			(11,307	)
Restated net profit			588,279				85,715
Adjustments to restated net profit excluding one-time and extraordinary events:
Sales of hotel assets			(324,092	)			(47,222	)
Staff Severance cost			31,485				4,588
Impairment charge on intellectual property			40,000				5,828
Related income tax effects			(4,723	)			(688	)
Adjusted restated net profit			330,949				48,221
Adjusted restated net profit attributable to:
Equity holders of the parent			236,974				34,528
Non-controlling interests			93,975				13,693
			330,949				48,221
Restated net earnings per common share
- Basic			8.54				1.24
- Diluted			8.52				1.24
Net earnings per common share adjustment due to one-time and extraordinary events
- Basic			(2.73	)			(0.40	)
- Diluted			(2.73	)			(0.40	)
Adjusted restated net earnings per common share excluding one-time and extraordinary events
- Basic			5.81				0.84
- Diluted			5.79				0.84

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Non-IFRS Financial Measures

To supplement our consolidated financial statements, we provide the following additional information on the adjustments:

UNAUDITED Reconciliation of adjusted restated net profit for the year ended December 31, 2017

(RMB and US$ amounts expressed in thousands, except per share data)

		Year ended December 31, 2017
		RMB ’000				US$ ’000
Net profit			1,405,070				204,726
Adjustment arising from adoption of IFRS 15			(85,217	)			(12,417	)
Restated net profit			1,319,853				192,309
Adjustments to net profit excluding one-time and extraordinary events:
Sales of hotel assets			(324,092	)			(47,222	)
Staff severance cost			107,732				15,697
Impairment charge on intellectual property			40,000				5,828
Related income tax effects			(16,160	)			(2,355	)
Adjusted restated net profit			1,127,333				164,257
Adjusted restated net profit attributable to:
Equity holders of the parent			826,744				120,460
Non-controlling interests			300,589				43,797
			1,127,333				164,257
Restated net earnings per common share
- Basic			21.80				3.18
- Diluted			21.80				3.18
Net earnings per common share adjustment due to one-time and extraordinary events
- Basic			(1.52	)			(0.22	)
- Diluted			(1.52	)			(0.22	)
Adjusted restated net earnings per common share excluding one-time and extraordinary events
- Basic			20.28				2.96
- Diluted			20.28				2.96

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CHINA YUCHAI INTERNATIONAL LIMITED

Impact on adoption of IFRS 15 Revenue from Contracts with Customers:

The figures presented below are all expressed in thousands except for per share data.

IFRS 15 Revenue from Contracts with Customers

IFRS 15 Revenue from Contracts with Customers is effective for the annual periods beginning on or after January 1, 2018. IFRS 15 establishes a five steps model to account for the revenue arising from the contracts with customers. Under IFRS 15, revenue is recognized at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring of goods or services to a customer.

The Group has applied the changes in accounting policies retrospectively to each reporting period presented, using the full retrospective approach. Accordingly, the comparative figures in the balance sheet at December 31, 2017 and the income statement for the quarter and year-to-date ended December 31, 2017 have been restated to reflect the retrospective adjustments upon adoption of IFRS 15.

Warranty obligations

Under IFRS 15, the Group accounts for a service-type warranty as a separate performance obligation to which the Group allocates a portion of the transaction price. The portion of the consideration allocated to the service-type warranty is initially recorded as a contract liability and recognized as revenue over the period which warranty services are provided.

As a result, the Group’s income statement for the fourth quarter of 2017 was restated as follows:

• Revenue increased by RMB 5,540 to RMB 3,786,352.

• Cost of sales increased by RMB 35,468 to RMB 2,735,790.

• Other operating income, net decreased by RMB 115,236 to RMB 370,561. This RMB 115.2 million was the one-time gain on the sale of technology know-how of YC6K upon completion of engineering design services.

• Selling, general and administrative cost decreased by RMB 41,567 to RMB 548,453.

• Income tax expenses decreased by RMB 25,994 to RMB 28,154. This RMB 26.0 million was the relative income tax expenses attributed to the sales of technology know–how of YC6K.

• Profit after tax was adjusted from RMB 665,882 to RMB 588,279.

• Profit attributable to the equity holders of the parent was adjusted from RMB 407,855 to RMB 348,558.

• Basic and diluted earnings per share were adjusted from RMB 9.99 and RMB 9.97 to RMB 8.54 and RMB 8.52 respectively.

As a result, the Group’s income statement for the twelve months ended 2017 was restated as follows:

• Revenue decreased by RMB 24,623 to RMB 16,197,819.

• Cost of sales increased by RMB 134,349 to RMB 12,841,768.

• Other operating income, net decreased by RMB 115,236 to RMB 509,397. This RMB 115.2 million was the one-time gain on the sale of technology know-how of YC6K upon completion of engineering design services.

• Selling, general and administrative cost decreased by RMB 162,997 to RMB 1,652,856.

• Income tax expenses decreased by RMB 25,994 to RMB 194,173. This RMB 26.0 million was the relative income tax expenses attributed to the sales of technology know–how of YC6K.

• Profit after tax was adjusted from RMB 1,405,070 to RMB 1,319,853.

• Profit attributable to the equity holders of the parent was adjusted from RMB 953,922 to RMB 888,807.

• Earnings per share were adjusted from RMB 23.40 to RMB 21.80.

The effect of the restatements on the equity attributable to equity holders of the parent as at December 31, 2017 was adjusted from RMB 8,347,562 to RMB 8,334,289.

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