China Yuchai International Ltd. Files 20-F Report for Fiscal Year 2023

TL;DR

<b>China Yuchai International Ltd. filed its 20-F report, detailing deferred tax liabilities and asset valuations for the fiscal year 2023.</b>

AI Summary

CHINA YUCHAI INTERNATIONAL LTD (CYD) filed a Foreign Annual Report (20-F) with the SEC on April 26, 2024. The filing primarily addresses deferred tax expense related to withholding tax on dividends from Yuchai. Deferred tax liabilities are noted for cumulative withholding tax on dividends expected from income earned after December 31, 2007. Fair values of debt financial assets at fair value through OCI were measured using a discounted cash flows model. The consideration for an asset was RMB 179.9 million (US$ 25.3 million), including cash and equipment. The report covers fiscal year 2023, ending December 31, 2023.

Why It Matters

For investors and stakeholders tracking CHINA YUCHAI INTERNATIONAL LTD, this filing contains several important signals. This filing provides crucial details on the company's tax liabilities, specifically concerning withholding taxes on dividends, which can impact future profitability and cash flows. The valuation of financial assets using discounted cash flows highlights the company's approach to managing and reporting its investments, offering insight into its financial strategy.

Risk Assessment

Risk Level: medium — CHINA YUCHAI INTERNATIONAL LTD shows moderate risk based on this filing. The company's deferred tax liabilities related to withholding tax on dividends represent a significant financial obligation that could affect future earnings and cash availability.

Analyst Insight

Investors should monitor the company's dividend payout strategy and its implications for these deferred tax liabilities.

Key Numbers

• 2023-12-31 — Fiscal Year End (Conformed Period of Report)
• 2024-04-26 — Filing Date (Filed As Of Date)
• RMB 179.9 million — Asset Consideration (Value of an asset including cash and equipment)
• US$ 25.3 million — Asset Consideration (USD) (Equivalent USD value of the asset consideration)

Key Players & Entities

• CHINA YUCHAI INTERNATIONAL LTD (company) — Filer name
• Yuchai (company) — Source of dividends
• RMB 179.9 million (dollar_amount) — Consideration for an asset
• US$ 25.3 million (dollar_amount) — Consideration for an asset
• Suzhou Reman (company) — Location of equipment

FAQ

Risk Factors

• Deferred Tax Liabilities [medium — financial]: The company has deferred tax liabilities relating to cumulative withholding tax on dividends expected from income earned after December 31, 2007.

Industry Context

China Yuchai International Ltd. operates in the engine manufacturing industry, a sector sensitive to economic cycles and regulatory changes.

Regulatory Implications

The company's operations are subject to PRC tax regulations, particularly concerning dividend distributions and withholding taxes.

What Investors Should Do

1. Review the detailed breakdown of deferred tax liabilities and their potential impact on future earnings.
2. Analyze the company's financial asset valuation methods, specifically the use of discounted cash flows.
3. Assess the implications of PRC withholding tax regulations on the company's dividend policy and international operations.

Glossary

Deferred Tax Expense

An expense recognized in the income statement for taxes payable in future periods. (Indicates a future tax obligation for the company.)

Withholding Tax

A tax deducted at source from payments made to non-residents. (Relevant to the company's dividend distribution strategy and international tax obligations.)

Fair Value Through OCI

Accounting treatment for financial assets where changes in fair value are recognized in Other Comprehensive Income. (Affects the reported equity and financial asset valuation.)

Discounted Cash Flows Model

A valuation method used to estimate the value of an investment based on its expected future cash flows. (Used by the company to measure the fair value of its debt financial assets.)

Year-Over-Year Comparison

This filing is a 20-F report, which is an annual report required for foreign private issuers. Specific comparative financial data from a prior filing is not detailed within this extract.

Key Financial Figures

• $0.10 — h Registered Common Stock, par value US$0.10 per Share CYD The New York Stock Ex
• $0 — are, and one special share, par value US$0.10, were issued and outstanding. Indi
• $1 — US dollar at the rate of RMB 7.1036 = US$1.00, the rate quoted by the People's Ban
• $1.3457 — ore dollar to US dollar at the rate of S$1.3457 = US$1.00, the noon buying rate in New

Filing Documents

• d757705d20f.htm (20-F) — 5169KB
• d757705dex47.htm (EX-4.7) — 45KB
• d757705dex81.htm (EX-8.1) — 45KB
• d757705dex121.htm (EX-12.1) — 10KB
• d757705dex122.htm (EX-12.2) — 10KB
• d757705dex131.htm (EX-13.1) — 3KB
• d757705dex132.htm (EX-13.2) — 3KB
• d757705dex151.htm (EX-15.1) — 2KB
• d757705dex971.htm (EX-97.1) — 25KB
• g757705g41u01.jpg (GRAPHIC) — 171KB
• 0001193125-24-116234.txt (&nbsp;) — 24253KB
• cyd-20231231.xsd (EX-101.SCH) — 169KB
• cyd-20231231_cal.xml (EX-101.CAL) — 117KB
• cyd-20231231_def.xml (EX-101.DEF) — 589KB
• cyd-20231231_lab.xml (EX-101.LAB) — 996KB
• cyd-20231231_pre.xml (EX-101.PRE) — 896KB
• d757705d20f_htm.xml (XML) — 6130KB

Identity of Directors, Senior Management and Advisers

Item 1. Identity of Directors, Senior Management and Advisers 4

Offer Statistics and Expected Timetable

Item 2. Offer Statistics and Expected Timetable 4

Key Information

Item 3. Key Information 5

Information on the Company

Item 4. Information on the Company 25

Unresolved Staff Comments

Item 4A. Unresolved Staff Comments 41

Operating and Financial Review and Prospects

Item 5. Operating and Financial Review and Prospects 41

Directors, Senior Management and Employees

Item 6. Directors, Senior Management and Employees 51

Major Shareholders and Related Party Transactions

Item 7. Major Shareholders and Related Party Transactions 60

Financial Information

Item 8. Financial Information 63

The Offer and Listing

Item 9. The Offer and Listing 65

Additional Information

Item 10. Additional Information 65

Quantitative and Qualitative Disclosures About Market Risk

Item 11. Quantitative and Qualitative Disclosures About Market Risk 77

Description of Securities Other Than Equity Securities

Item 12. Description of Securities Other Than Equity Securities 79 Part II

Defaults, Dividend Arrearages and Delinquencies

Item 13. Defaults, Dividend Arrearages and Delinquencies 79

Material Modifications to the Rights of Security Holders and Use of Proceeds

Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds 79

Controls and Procedures

Item 15. Controls and Procedures 79

Audit Committee Financial Expert

Item 16A. Audit Committee Financial Expert 80

Code of Ethics

Item 16B. Code of Ethics 80

Principal Accountants Fees and Services

Item 16C. Principal Accountants Fees and Services 80

Exemptions from the Listing Standards for Audit Committees

Item 16D. Exemptions from the Listing Standards for Audit Committees 81

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers 81

Change in Registrant's Certifying Accountant

Item 16F. Change in Registrant's Certifying Accountant 81

Corporate Governance

Item 16G. Corporate Governance 81

Mine Safety Disclosure

Item 16H. Mine Safety Disclosure 81

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Item 16I. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 81

Insider Trading Policies

Item 16J. Insider Trading Policies 81

Cybersecurity

Item 16K. Cybersecurity 81 Part III

Financial Statements

Item 17. Financial Statements 82

Financial Statements

Item 18. Financial Statements 83

Exhibits

Item 19. Exhibits 84

Signatures

Signatures 86 Consolidated Financial Statements F-1 1 Table of Contents Certain Definitions and Supplemental Information All references to "China" and "PRC" in this Annual Report are references to the People's Republic of China. Unless otherwise specified, all references in this Annual Report to "US dollar" or "US$" are to the United States dollar; all references to "Renminbi" or "RMB" are to Renminbi, the legal tender currency of China; all references to "S$" are to the Singapore dollar, the legal tender currency of Singapore. Unless otherwise specified, translation of amounts for the convenience of the reader has been made in this Annual Report (i) from Renminbi to US dollar at the rate of RMB 7.1036 = US$1.00, the rate quoted by the People's Bank of China, or the PBOC, on February 29, 2024, and (ii) from Singapore dollar to US dollar at the rate of S$1.3457 = US$1.00, the noon buying rate in New York for cable transfers payable in foreign currencies as certified for customs purposes by the Federal Reserve Bank of New York on February 29, 2024. No representation is made that the Renminbi amounts or Singapore dollar amounts could have been, or could be, converted into US dollar at rates specified herein or any other rate. As used in this Annual Report, unless the context otherwise requires, the terms "the Company", "the Group", "CYI", "we", "us", "our" and "our Company" refer to China Yuchai International Limited, or as the context requires, China Yuchai International Limited and its subsidiaries. All references herein to "Yuchai" are to Guangxi Yuchai Machinery Company Limited and its subsidiaries and, prior to its incorporation in July 1992, to the machinery business of its predecessor, Guangxi Yulin Diesel Engine Factory, or Yulin Diesel. In the restructuring of Yulin Diesel in July 1992, its other businesses were transferred to Guangxi Yuchai Machinery Group Company, which became a shareholder of Yuchai. All references herein to "GY" are to Guan

Risk Factors

Risk Factors Risks Related to Our Business and Industry The diesel engine business in China is dependent in large part on the performance of the Chinese and the global economy. Adverse economic developments in China or in the global economy could have a material adverse effect on our financial condition, results of operations, business or prospects. Our operations and performance depend significantly on economic conditions in China and globally. Economic factors such as GDP growth, industrial output, consumer spending, and trade dynamics directly influence the demand for our diesel products in various sectors such as transportation, construction, agriculture, and manufacturing. During periods of economic expansion, the demand for trucks, construction machinery and other applications of diesel engines generally increases. Conversely, uncertainty about current global economic conditions or adverse changes in the economy could lead to a significant decline in the diesel engine industry which is generally adversely affected by a decline in demand. The interconnectivity of the global economy implies that economic events and trends in major markets like the United States and Europe, and emerging economies in Asia Pacific region can likewise impact the demand for diesel engines in China. Factors like trade tensions, geopolitical risks, and shifts in consumer preferences in these markets can have ripple effects on global trade flows and economic activities, ultimately influencing demand for our products sold both in China and overseas. In addition, the performance of the Chinese economy affects, to a significant degree, our financial condition, results of operations, business and prospects. Uncertainty and adverse changes in the Chinese economy could also increase costs associated with developing our products, increase the cost and decrease the availability of potential sources of financing, and increase our exposure to material losses from our investments, any of

View Full Filing

View this 20-F filing on SEC EDGAR