Guizhou Guihang Automotive Components Co., Ltd. Business Report FY ended Dec. 2018

Business Results

(in million yuan)

	FY ended Dec. 31, 2018	FY ended Dec. 31, 2017	Rate of change	Factors
Sales	2,798.50	3,391.14	17.48%	Due to market influence, the Company withdrew old products, and it didn't realize mass production of new products.
Operating profit	147.14	227.41	35.30%
Ordinary profit	153.76	240.41	36.04%	Declined orders and sales resulted in profit decrease; profit further reduced due to price reduction of components and raw materials under the pressure of OEMs.
Net profit	134.20	210.29	36.18%

Equity Adjustment

-Guizhou Guihang Automotive Components Co., Ltd. said on November 6, 2017, that the company acquired shares in its three subsidiaries. The company bought a 47% stake in Guizhou Huayang Automotive Parts Co., Ltd. from its wholly-owned subsidiary, Guizhou Huayang Electronics Co., Ltd., to raise its shareholding ratio to 85% from 38%. The company also purchased all shares in Chengdu Wanjiang Automotive Components Co., Ltd. in which another wholly-owned subsidiary, Guiyang Wanjiang Aviation Electromechanical Co., Ltd., holds, to make it a wholly-owned subsidiary of the company. Also, the company purchased 80% shares in Shanghai Wanjiang Automobile Parts Co., Ltd. to hold an 80% stake from Guiyang Wanjiang. (From a corporate announcement on November 6, 2017)

Business Plan for Next Year

-In 2019, the Company plans to reach CNY 2.7 billion sales, more or less the same as last year; and plans to reach CNY 0.22 billion profits, increased by 43.08% on a year-over-year basis. (From the Company's 2018 annual report)

R&D Expenditure

(in million CNY

	FY ended Dec. 31, 2018	FY ended Dec. 31, 2017	FY ended Dec. 31, 2016
R&D Expenditure	129.00	121.57	102.88
Expenditure/Operating revenue(%)	4.61	3.59	3.06

R&D Staff

-In 2018, the Company has 810 R&D personnel.

Capital Investment Projects in FY2017

(in million CNY

Projects	Budget	Investment in 2018	Project progress
FAW VW oil cooler project	9.8	4.09	44.23
Technology transformation (equipment purchasing)	2.64	0.47	68.61
Equipment for extrusion lines	33.14	-	100
One-step rubber production line	13.70	-	100