Financial Overview

(in million yuan)

	Dec. 2009	Dec. 2008	Difference (%)	Factors
Sales	400.28	520.60	(23.11%)	Sales decreased sharply due to the following factors: - The transfer of a subsidiary, Shanghai Yidong Clutch co., Ltd., and the suspension of business operations at Changchun Yidong Equipment Manufacturing Co., Ltd. This led to a decrease in sales of 108million yuan. - Although the sales of passenger cars increased in 2009, products that the company supplied to passenger cars accounted for only 27% of the company's sales.
Operating profit	(44.73)	11.87	-	-Both the gross profit margin and sales decreased as a result of a relocation and an over supply of semi-finished products. -The amount of bad debts from accounts receivable over one year old increased, resulting in a 6.05million yuan loss. -Costs and expenses increased due to a relocation of operations. -Customer claims regarding product quality increased, which generated 25.2million yuan in sales expenses.
Ordinary profit	(40.25)	13.24	-
Net profit	(34.44)	12.01	-

 

Acquisition

The Company will privately issue a total of 90 million new shares to Jilin Dongguang Group Co., Ltd. and FAW for the purpose of acquiring assets that these companies own in the auto parts sector. Specifically, the company will buy up 93.53 percent of Changchun Yidong Clutch Co., Ltd.'s stock; all the assets and liabilities of JiLin Automobile Brake Factory; and an 85 percent Shandong Pengxiang Auto Co., Ltd.'s stock. (From an announcement by the company, October 23, 2009)

 

Restructuring

-The Company stopped operating Shanghai Yidong Clutch Co., Ltd. and Changchun Yidong Equipment Manufacturing Co., Ltd.
-The shareholdings of Shanghai Yidong Clutch Co., Ltd. were put up for sale.

R&D Structure

Jilin University, Changchun Faway Automobile Components; Changchun Yidong Clutch Co., Ltd.; Fawer Automotive Parts Limited Company; Changchun Xuyang Industry(Group) Co.,Ltd. and the Technology Center of China FAW Group established a joint-venture company, named as Jinling Auto Parts R&D Center Co.,Ltd. The new entity will be capitalized at 10 million yuan, with Jilin University providing 50 percent or 5 million yuan and the other companies contributing 10 percent or 1 million yuan each. The joint-venture company will engage in the development, designing, testing, and inspection of auto parts; technical consultation; technical services, training; and automotive software development. (From an announcement by the company, August 4, 2009)

 

Product Development

-20 new products for FY2009

Capital investment projects for FY2009

(in millions of yuan)

Project	Capital	Budgeted amount	Amount invested in FY2009	Ratio of amount already invested	Status
Jilin automotive component R&D Center	Own Funds	1	1	100%	Completed
Acquisition of land for a new plant in the Changchun High Technology Development Zone	Funds raised	10.60	10.60	100%	Completed
Construction of a new plant in the Changchun High Technology Development Zone and transfer of operations there	Own funds	128.02	65.42	51.1%	The company launched project to transfer operations, following the completion of the new plant.

 

Investment in China

In 2009, in line with the municipal planning project designed by the city of Changchun, Changchun Yidong Clutch Co., Ltd. established a new plant in the Changchun High Technology Development Zone and moved its headquarters there. The Construction work and the relocation was completed by the end of 2008.