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Income tax expense (Tables)

12 Months Ended

Dec. 31, 2024

Major components of tax expense (income) [abstract]

Summary of Income Tax Expense

The major components of income tax expense for the years ended December 31, 2022, 2023 and 2024 are as follows:


		31.12.2022				31.12.2023				31.12.2024				31.12.2024
		RMB’000				RMB’000				RMB’000				US$’000
Current income tax
- Current year			61,374				66,493				77,923				10,862
- Under provision in respect of prior years			27,406				27,837				151				21
Deferred tax
- Movement in temporary differences			(41,147	)			(14,837	)			17,384				2,423
- (Over)/under provision in respect of prior years			(103	)			54,131				17,675				2,464
Withholding tax
- Income tax expense recognized in profit or loss			11,535				14,872				15,665				2,184
Consolidated income tax expense reported in the statement of profit or loss			59,065				148,496				128,798				17,954

Reconciliation of Income Tax Expense

The reconciliation between tax expense and the product of accounting profit multiplied by the PRC income tax rate of 15% (being tax rate of Yuchai) for the years ended December 31, 2022, 2023 and 2024 for the following reasons:


		31.12.2022				31.12.2023				31.12.2024				31.12.2024
		RMB’000				RMB’000				RMB’000				US$’000
Profit before tax			394,726				571,352				620,540				86,501
Income tax expense at 15%			59,209				85,703				93,081				12,975
Adjustments:
Non-deductible expenses			7,924				5,888				7,807				1,088
Tax-exempt income			(500	)			(11,993	)			(16,087	)			(2,242	)
Utilization of deferred tax benefits previously not recognized			(3,093	)			(6,211	)			(8,077	)			(1,126	)
Recognition of deferred tax benefits not previously recognized			—				—				(3,458	)			(482	)
Write off deferred tax benefits previously recognized			—				—				105,682				14,732
Deferred tax benefits not recognized			22,606				42,830				72,680				10,131
Tax credits for research and development expense			(76,835	)			(85,372	)			(114,006	)			(15,892	)
Tax rate differential			10,901				21,542				(42,633	)			(5,943	)
Under provision in respect of previous years			27,303				81,968				17,826				2,485
Withholding tax expense			11,535				14,872				15,665				2,184
Others			15				(731	)			318				44
Total			59,065				148,496				128,798				17,954

Summary of Deferred Tax

Deferred tax relates to the following:


		Consolidated statement of financial position												Consolidated statement of profit or loss
		31.12.2023				31.12.2024				31.12.2024				31.12.2022				31.12.2023				31.12.2024				31.12.2024
		RMB’000				RMB’000				US$’000				RMB’000				RMB’000				RMB’000				US$’000
Accelerated tax depreciation			(77,806	)			(34,108	)			(4,755	)			16,472				44,492				43,698				6,091
Interest receivable			—				—				—				363				3,033				—				—
PRC withholding tax on dividend income (i)			(64,717	)			(64,717	)			(9,021	)			(11,458	)			(14,457	)			(15,541	)			(2,166	)
Effect of change in residual value and impairment of property, plant and equipment			2,866				724				101				4,273				(66,774	)			(2,142	)			(299	)
Write-down of inventories			37,120				38,632				5,385				9,253				7,617				1,512				211
Impairment losses on trade receivables			7,426				32,540				4,536				282				355				25,114				3,501
Accruals			232,048				166,623				23,227				(48,841	)			(2,505	)			(65,540	)			(9,120	)
Deferred income			79,896				126,107				17,579				(41,348	)			23,416				46,211				6,442
Losses available for offsetting against future taxable income			112,601				—				—				116,675				(27,146	)			(112,601	)			(15,696	)
Others			31,854				79,871				11,134				(4,421	)			(7,325	)			44,230				6,149
Deferred tax benefits/(expenses)															41,250				(39,294	)			(35,059	)			(4,887	)
Net deferred tax assets			361,288				345,672				48,186
Reflected in the consolidated statement of financial position as follows:
Deferred tax assets			426,377				410,728				57,254
Deferred tax liabilities			(65,089	)			(65,056	)			(9,068	)
			361,288				345,672				48,186

Note:

(i)

The movement of PRC withholding tax on dividend income is as follows:


		31.12.2023				31.12.2024				31.12.2024
		RMB’000				RMB’000				US$’000
At January 1			(61,825	)			(64,717	)			(9,021	)
Provision made to consolidated statement of profit or loss			(14,457	)			(15,541	)			(2,166	)
Utilization			11,565				15,541				2,166
December 31			(64,717	)			(64,717	)			(9,021	)

Deferred Tax Assets That Have Not Been Recognized

Deferred tax assets have not been recognized in respect of the following items:


		31.12.2023				31.12.2024				31.12.2024
		RMB’000				RMB’000				US$’000
Unutilized tax losses			628,534				1,681,991				234,463
Unutilized capital allowances and investment allowances			94,447				95,697				13,340
Other unrecognized temporary differences relating to asset impairment and deferred grants			156,226				166,552				23,217
			879,207				1,944,240				271,020