China Yuchai International’s Q3 Profit Grows 36% On Higher Margins
China Yuchai International (NYSE:CYD), a diesel-engine manufacturer based in Singapore, said today that it reported double-digit profit growth for the third quarter as margins increased.
Third quarter revenues declined 5% year-over-year to RMB 3.3
billion (US$ 497.6 million) on lower diesel engine sales as the company
transitioned to selling more higher margin heavy-duty engines.
As a result of the new product mix, gross margins expanded to 23.1% from 19.9% in Q3 of 2009.
For the third quarter, profits attributable to the company’s
shareholders totalled RMB 217.5 million (US$ 32.5 million), or RMB 5.84
(US$ 0.87) per share, compared with RMB 160.2 million (US$ 23.9
million), or RMB 4.30 (US$ 0.64) per share in year-ago period. The 36%
year-over-year earnings increase was mainly due to the gross margin
increase during the quarter.
The company also said its joint venture with Jirui United Heavy Industry is expected to begin production at the end of 2010.
The joint venture will produce the YC6K diesel engine, an engine
designed for trucks and passenger coaches, as well as the YC6M and YC6L
heavy-duty diesel engines.
The joint venture’s annual production capacity is currently
estimated to be 50,000 heavy-duty diesel engines, which will be
gradually increased to 0.2 million units.
Given the joint venture’s pending production start, Boo Guan Saw,
President of China Yuchai, said the company is optimistic in getting a
bigger slice of the heavy-duty engine market in 2011.
The company’s shares are down 0.5% to trade at $26.61 as of 1:58
pm ET. Over the past year, the company’s shares have rallied 87%.
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