Financial overview

(million yuan)

	FY2012	FY2011	Rate of change(%)	Factors
Sales	4,727.37	4,074.76	16.01%	-Efficient marketing -Benefit from technology improvement -Product brand advantage
Operating profit	117.60	73.25	60.55%	-Increasing revenue  -Cost control
Ordinary profit	101.33	83.79	20.93%
Net profit	74.98	67.86	10.49%

- In 2011, the company introduced international advanced production equipment to build an AGM battery production line. Now, the line has started small volume production for Shanghai GM, BYD and other vehicle manufacturers (approximately 7,000 in 2012).（From the company's 2012 annual report)

- The 4 million annual output AGM battery project will be completed in two phases and the output capacity of each phase is 2 million pieces  per year. The first phase will be completed and put into operation by May, 2015, the second phase Sep., 2016. The overall annual production capacity will be 4 million pieces.（From the company's 2012 annual report)

Supply Agreements
- Fengfan Co., Ltd. supplied 8 51AH batteries packs and 14 60AH battery packs for the soon-to-be-released Shanghai VW YETI models on December 20, 2012. Supply volume is expected to reach 200,000 units a year. (From a press release, January 16, 2013)

- Fengfan Co., Ltd. announced that it will supply batteries for Greatwall Automobile’s Haval H6, marking the first time to produce batteries for luxury SUVs built by a Chinese automaker. On November 16, 2012, the company delivered 100 prototype batteries to Greatwall as the first lot. (From a press release, December 18, 2012)

- Fengfan was awarded a new program to supply AGM batteries to Shanghai GM. Delivery of the products is scheduled to start in 2014. Fengfan is expecting to supply 400,000 batteries a year on an average. (From a press release, September 10, 2012)

- Fengfan’s batteries were chosen by Shanghai GM for installation on the D2XX. The company received a notice regarding the program business from the Global Procurement Division of General Motors North America on June 22, 2012. (From a press release, July 17, 2012)

- Fengfan Co., Ltd. will become a sole supplier of rechargeable batteries for use in oil exploration vehicles and equipment to BGP Inc., China National Petroleum Corp. in the CNP Group . The company will be delivering more than 20,000 batteries, which are worth 10 million yuan in sales. Fengfan’s sales company, an auto parts supplier in Baoding City, and BGP Inc. signed a basic agreement on the business on April 20, 2012. (From a press release, May 2, 2012) 

Acquisition
- Fengfan Co., Ltd. announced that it will acquire the 42 percent of the share in Baoding Fengfan Rising Battery Separator Co., Ltd. (BFR) now owned by the Fengfang Group, its parent company. The acquisition will make Fengfan the largest shareholder of BFR, which is a joint venture by the Fengfan Group, Johnson Controls of the U.S.., and the Rising Group of the U.K. BFR is capitalized at 17.97 million dollars, of which 42 percent was provided by Fengfang, 40 percent by Johnson Controls, and 18 percent by Rising. It produces and sells battery separators. (From an announcement by the company, December 11, 2012)

Awards
- Fengfan Co., Ltd. has received the Excellent Quality System Basic (QSB) Improvement Award from Shanghai GM. (From a press release, March 15, 2012)

- December 2011, the Company was given the Significant Improvement Award from Shanghai GM for its excellence in its Quality System Basics (QSB), which the company has established over the past few years. (From a press release, January 1, 2012)

-The Company received the Excellent Quality Award and the Core Supplier Award both from FAW-VW and the FAW Group Corp. at their suppliers' meeting for 2011. (From a press release, January 11, 2012)

R&D activities

-The Company conducts its development activities at Fengfan Technical Center.

Product development

- The Company signed a strategic partnership agreement with Hebei University on May 28, 2012. Based on the agreement, the company is intending to step up its basic scientific research activities to develop new technologies, while Hebei University is expecting to accelerate commercialization of its development achievements. The new collaboration is positioned as a major step toward advancing business development by both sides. (From a press release, June 14, 2012)

-The Company has 148 authorized patents, covering all battery areas. In 2011, the Company applied for 28 patents, in which there are 6 patents for invention.
-The sample 68Ah battery of AGM(absorbed glass mat) project was sent to VW for the test.(From the Company's 2012 annual report) 

New Products
- Fengfan Co., Ltd. is going to release its high temperature resistant batteries, including the 6-QW-60 series, targeted at the southern region of China. The company developed the high-performance batteries through joint efforts by its sales department and the battery department. The company’s sales staff visited its customers and end-users in the southern region to perform in-depth research activities related to the development project. (From news release, July 17, 2012)

Capital investment projects using raised funds (as of Dec.2012）

(in million yuan)

Capital investment projects	Planned investment amount	Funds	Status
Construction project for lithium-ion battery production facilities	200.00	Funds raised	Completed
Constructing its new plant that will produce 5 million units maintenance-free lead-acid batteries	675.7	Own funds	The first phase  has been completed and the second phase will be completed by the end of 2013.
Construction project for production facilities to manufacture both thin-film amorphous silicon solar cells and photovoltaic (PV) power generation systems	105.0	Own funds	Completed
AGM (absorbed glass mat) project	33.98	Own funds	Completed
Xushui 5 million high-performance battery	587.5	Own funds	The first phase will be completed and put into operation by the end of 2013.
The Tangshan fengfan project	138.68	Own funds	Completed