Fuyao Glass Industry Group Co., Ltd. Business Report FY ended Dec. 2016
Financial Overview |
(million yuan) |
| FY ended Dec. 31, 2016 | FY ended Dec. 31, 2015 | Increases (%) | Factors | |
| Sales | 16,621.34 | 13,573.50 | 22.45 | The sales of automotive products increased due to: -The increase of the sales of automotive glass; |
| Operating profit | 3,839.86 | 3,051.24 | 25.85 | The profits increased due to: -Putting quality management into practice with continuous improvement; -Cost control. |
| Ordinary profit | 3,919.63 | 3,042.72 | 28.82 | |
| Net profit | 3,142.72 | 2,607.50 | 20.53 |
-The Company announced that its revenues from the sale of automotive glass in 2016 reached CNY 16,621.34 million, 22.45 percent up from those of 2015.
Recent Development
-The Company announced that its two new plants in Zhangjiawo Town, Xiqing District, Tianjin have begun trial production. CNY 1 billion was invested in these facilities that were constructed on approximately 270,000 square meters of land. One plant produces tempered glass and the other produces laminated glass. These plants are China’s largest and the most advanced auto glass production bases with automated operation and intelligent technologies. Annual production capacity is expected to reach 4 million sets when the plants reach full-scale operations. Products will be supplied mainly to Mercedes-Benz, BMW, Hyundai Motor, General Motors, and Chinese automakers. (From news releases issued by multiple sources on November 22, 2016)
-The Company’s new automotive glass lines in Mt. Zion, Illinois and Dayton, Ohio have begun tests for mass production, and will begin production on October 5 and October 7, 2016 respectively. The new automotive glass plants project was launched in 2014. In July the same year, the company acquired PPG Industries’ two float glass production lines at the Mt. Zion Plant for USD 56 million, and converted them into new lines for producing high-quality float glass for automobiles. It also spent USD 400 million for a new plant in Dayton, which will be capable of producing 22 million square meters (excluding 1.08 million square meters of edge work) of automotive safety glass per year.(From news releases issued by multiple sources on September 29, 2016)
-On June 1, 2016, Fuyao Glass started operations of two new float glass lines at its U.S. subsidiary. The daily melting capacity of the each line is 600 tons. The line can produce annually 280,000 tons of automotive glass in various thicknesses and colors. (From a press release on June 2, 2016)
New Companies
-The Company will invest a wholly owned subsidiary in Suzhou. The new company will be called Fuyao Glass (Suzhou) Co., Ltd., and will be capitalized at CNY 400 million. Approximately CNY 1 billion will be invested in the new company that will mainly develop, produce, and sell automotive glass and related components. The subsidiary will construct an automotive safety glass plant that will be capable of producing 4 million sets per year. (From an announcement by the company on February 27, 2017)
-The Company announced that will establish a float glass production subsidiary in Benxi, Liaoning Province, China. The new company will be called Benxi Fuyao Float Glass Co., Ltd. and will be capitalized at CNY 500 million. The facility will have three advanced production lines to produce high-quality float glass for processed glass like tempered glass, laminated glass, and coated glass. (From an announcement by the company on October 31, 2016)
Awards
-The Volkswagen Group presented the 2016 Volkswagen Group Award to its best suppliers. The winners of the Volkswagen Group Award 2016 include Continental AG, Faurecia S.A., Federal-Mogul Corporation, Fuyao Glass Industry Group, Gestamp Automocion S.A., and Keihin Thermal Technology Corporation. (From a press release on June 2, 2016)
R&D Expenditure
| FY ended Dec. 31, 2016 (million yuan) |
FY ended Dec. 31, 2015 (million yuan) |
FY ended Dec. 31, 2014 (million yuan) |
|
| R&D Expenditure | 727.59 | 592.89 | 517.92 |
| Ratio of R&D expenses to operating income | 4.38% | 4.37% | 4.01% |
R&D Structure
-In 2016, the Company has 3,027 R&D staff, accounting for 11.59% of the total employees.
R&D Facilities
| Name | Fuyao Technical Center |
| Overview | -The technical center currently conducts its R&D activities in 10 divisions: the automotive glass research center; construction glass research center; float glass research center; the research center for cutting-edge technology; CAE/CAM application research division; technical information and patent division; inspection and testing center; planning and project management division; production equipment technology center; and dies and jigs research and development center. -The center was certified as a national level research facility in September 2006. |
-The Company can design automotive glass with automobile plants synchronously and sets up four design centers in the world's major automobile production and sales area.
Capital Investment Projects |
(As of Dec. 31, 2016) |
| Projects | Planned amount of investment (million yuan) |
Amount invested in 2016 (million yuan) |
% so far invested of the total planned investment amount (%) |
| Renovating two automotive float glass production lines in U.S. | 1,567.62 | 149.80 | 97% |
| Fuyao Automotive North America's automotive glass project | 3,453.51 | 1,649.14 | 99% |
| Tianjin Fuyao's automotive glass project | 1,000.00 | 374.70 | 54% |
Investment outside China
-Fuyao Automotive North America, Inc., a subsidiary of the Company, announced that it will invest USD 70 million to revamp the factory in Plymouth, Michigan, which was previously owned by American Blind & Wallpaper Factory Inc. The renovated facility will produce and develop automotive glass. Fuyao acquired this 528,000-square-feet plant from a developer Grand Sakwa for USD 9.5 million in August 2016. The company plans to create 50 jobs by the end of 2016, and increase the number of the plant workers to 450 by 2017, and to 958 by 2019. (From news releases issued by multiple sources on October 8, 2016)