I did add CYD 6.77 +.14 on strong earnings out...here is a partial of the filing: CHINA YUCHAI INTERNATIONAL LIMITED ANNOUNCES
Q3 2006 PERFORMANCE
Singapore, November 13, 2006 - China Yuchai International Limited (“CYI”) today announced a net income of Rmb41.5 million (US$5.2 million) for the quarter ended September 30, 2006 as compared to a net income of Rmb31.6 million (US$3.8 million) for the same period in 2005.
Net sales of Rmb1,401.3 million (US$177.2 million) for the quarter ended September 30, 2006 achieved by Guangxi Yuchai Machinery Company Limited (“Yuchai”), the key operating subsidiary of CYI, represent an increase of 30% compared to Rmb1,074.3 million (US$130.4 million) for the same period last year. Total unit sales of 56,154 diesel engines for the quarter ended September 30, 2006 were 28% higher than the 43,773 units sold for the same period last year. This increase in net sales was primarily attributable to higher demand for light-duty and industrial diesel engines.
Net sales of Rmb5,030.8 million (US$636.1 million) for the nine months ended September 30, 2006 represent an increase of approximately 10% compared to Rmb4,589.7 million (US$557.3 million) for the same period last year. Total unit sales of 213,297 diesel engines for the nine months ended September 30, 2006 was approximately 17% higher than the 182,287 unit sales for the same period last year. This was mainly due to the strong unit sales arising from Yuchai’s 4-series light-duty diesel and industrial engines.
The overall gross margin of 20.2% for the nine months ended September 30, 2006 was lower than the 24.1% gross margin for the same period in 2005, due to keen competition, product sales mix and higher raw material costs. Yuchai sold 45% more of the lower margin light-duty diesel engines in the first nine months of 2006 compared to the same period in 2005.
The increase in research and development costs is mainly due to higher expenditure relating to Yuchai’s engine development on Euro III and IV compliant engines.
For the nine months ended September 30, 2006, selling, general and administrative expenses were comparable to the same period in 2005.
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CHINA YUCHAI INTERNATIONAL LIMITED
16 Raffles Quay #26-00 Hong Leong Building Singapore 048581
Tel : (65) 6220 8411 Fax : (65) 6226 0502
As at September 30, 2006, when compared to December 31, 2005, trade account receivables have increased as a result of higher sales volume and normal seasonality factors. Bank borrowings have increased mainly due to increased capital expenditure payments, higher working capital requirements and additional strategic investments in Thakral Corporation Ltd (“TCL”) and HLG Enterprise Limited (previously known as LKN-Primefield Limited) (“HLGE”).
Basic and diluted net income per share for the nine months ended September 30, 2006 was Rmb4.62 (US$0.58) compared to Rmb8.05 (US$0.98) for the same period in 2005.
Mr Philip Ting, Director and CFO commented that “the demand of new trucks and buses in China grew by 12% for the nine months ended September 30, 2006. This increase was accounted for mainly from higher sales of buses. Yuchai diesel engine sales for the third quarter 2006 were still mainly in the lower margin 4-series light-duty engines and industrial engines. Again, this is due to price affordability by Yuchai customers.”
Mr Ting added that “according to estimates from the China National Development & Reform Commission, China’s economy grew by 10.4% compared to 11.3% in the second quarter of 2006. China’s economy grew at a slower pace in the third quarter as the Chinese government’s austerity measures, to rein in excessive investments, started to take effect.”
On July 4, 2006, following a rights issue undertaken by HLGE, Grace Star Services Ltd. (a wholly-owned subsidiary of CYI) and its wholly-owned subsidiary, Venture Lewis Limited (“VLL”), were allotted 196,201,374 non-redeemable convertible cumulative preference shares in the capital of HLGE and 130,800,917 zero coupon unsecured non-convertible bonds due 2009 in HLGE, for an aggregate consideration of approximately S$134.7 million. The consideration was satisfied, in part, by offsetting against the money from the full redemption, by HLGE, of approximately S$129.4 million in principal amount of the outstanding secured non-convertible bonds held by VLL and the balance by cash.
CYI’s share of equity gains in affiliates relating to investments in TCL and HLGE amounted to Rmb10.8 million (US$1.4 million) for quarter ended September 30, 2006 compared with a loss of Rmb2.8 million (US$0.3 million) for the same period in 2005. These affiliates are exploring opportunities to expand and diversify their businesses.
General Information
CYI’s key operating subsidiary, Yuchai, has a strong brand name in China, with an extensive sales and marketing network. Yuchai’s products are of good quality and provide reliable performance. Yuchai has established itself as a major manufacturer of diesel engines in China with a significant market share.
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