Financial Overview

(in million yuan)

	FY ended Dec. 31, 2014	FY ended Dec. 31, 2013	Rate of change	Factors
Sales	5,167.19	4,619.61	11.85%	-The sales in batteries of the Company increased, which accounts for 99.4% of the total operating income. -New products development; -Expand marketing.
Operating income	749.48	564.99	32.65%
Ordinary income	798.82	615.06	29.88%
Net income	686.64	532.33	28.99%

Acquisition

-In July 2014, the Company acquired 100% shares of Yangzhou Apollo Battery Co., Ltd..

Contracts

-In 2014, the Company had got about 30 new contracts of start-stop batteries with many OEM makers, including VW, Ford, Volvo, Dongfeng Passenger Vehicle, and GAC Toyota, Changan Mazda, etc. For example:

• EFB batteries for VW: In November 2014, the Company got the contract to supply EFB batteries to FAW-VW, Shanghai VW, and VW Germany. It was the first time for the Company to get the approval from the VW Germany to EFB batteries.
• T7-EFB batteries for Ford: The Company got the contract to develop and produce batteries for the Ford T7 project and Ford B515 global project (H6-EFB）.
• AGM start-stop batteries for Dongfeng Passenger Vehicle: The Company got the contract to mass-produce about 20,000 units of AGM start-stop batteries. It's the first time for the Company to mass-produce and sell AGM batteries.

Pass the Test

-The Company announced that it had passed on-site inspections carried out by both Ford of North America and Changan Ford for production of its two new batteries (development codes: T7 EFB and H6 EFB). The product validation of the T7 batteries and the design verification of the H6 batteries will begin soon as planned. (From a press release on January 15, 2015)

Business Plan for Next Year

-In 2015, the Company plans to increase its prime operating income by 20%.

R&D Expenditure

	FY ended Dec. 31, 2014 (million yuan)	FY ended Dec. 31, 2013 (million yuan)	FY ended Dec. 31, 2012 (million yuan)
R&D Expenditure	197.54	162.61	131.26
Ratio of R&D expenses to operating income	3.82%	3.52%	3.30%

R&D Structure

Name	Main business	Location	Year established	Shareholding ratio
Hubei Camel Battery Institute Co., Ltd.	Develop batteries	Xiangfan, Hubei	2004	100%
Hubei Golden Camel Special Battery Equipment Technology Co., Ltd.	Develop batteries	Xiangfan, Hubei	2011	51%
Hubei Camel Electrical Co., Ltd	Develop electrical products	Wuhan, Hubei	2010	55%

Product Development

-In 2014, the Company had been developing the new products as follows:.

• For start-stop batteries, there are about 30 projects, involving in the cooperation with many OEM makers, such as VW, Ford, Volvo, Dongfeng Passenger Vehicle, GAC Toyota and Changan Mazda.
• For power lithium batteries, the Company strengthened the R&D and storage, mainly producing the batteries for pure electric buses, and power batteries as well.
• The Company made the small batch of production of LFP batteries and ternary batteries, which are independently developed by the Company.
• The Company's lead-acid batteries for low speed electric vehicles met the need of national standard, and the test result of the products' life was better than the average.
  
  

Investment in China

-In March 2015, the Company and Jiyuan Wanyang Smelting (Group) Co., Ltd. agreed to establish a joint venture in Jiyuan, Henan Province. The joint venture will be tentatively called Henan Jiyuan New Power Battery Technology Co., Ltd. The company will be capitalized at CNY 30 million, of which 51 percent will be invested by the Camel Group. The joint venture will develop, produce, and sell lead-acid batteries for electric vehicles. It will also collect used batteries. (From an announcement by the company on March 19, 2015)

-In 2014, the Company's investment volume reached CNY 720 million. The second phase of Camel Xiangyang Storage Battery Co.,Ltd., and the second phase of Camel Plastic Products Co., Ltd. had been finished.

Capital Investment Projects (as of Dec. 31, 2014)

(in million yuan)

Project	Budgeted amount	Investment in 2014	Ratio of cumulative investment to budget
Constructing production lines for producing 6 million high-performance low-lead consumption maintenance-free batteries	601.84		93.58%
Producing batteries for hybrid vehicles	376.72		77.70%
Constructing production lines for 200WKAH sealed batteries and 400WKVAH novel power batteries	-	11.57	-
600WKVAH project in South China Camel	-	159.74	-
Expansion project of the second phase of Camel Plastic Products Co., Ltd.	-	2.90	-