Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

濰柴動力股份有限公司

WEICHAI POWER CO., LTD.

(a joint stock limited company incorporated in the People's Republic of China with limited liability)

(Stock Code: 2338)

OVERSEAS REGULATORY ANNOUNCEMENT

This announcement is made pursuant to Rule 13.10B of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Stock Exchange").

Reference is made to an announcement made by Weichai Power Co., Ltd. (the "Company") on the website of Shenzhen Stock Exchange dated 30 October 2019, which is for information only. The full text of the announcement in Chinese is published on the websites of the Stock Exchange and the Company.

By order of the Board of Directors

Tan Xuguang

Chairman and CEO

Weifang, Shandong, PRC

30 October 2019

As at the date of this announcement, the executive Directors of the Company are Mr. Tan Xuguang, Mr. Zhang Quan, Mr. Xu Xinyu, Mr. Sun Shaojun, Mr. Yuan Hongming and Mr. Yan Jianbo; the non-executive Directors of the Company are Mr. Wang Yuepu, Mr. Jiang Kui, Mr. Gordon Riske and Mr. Michael Martin Macht; and the independent non-executive Directors of the Company are Mr. Zhang Zhong, Mr. Wang Gongyong, Mr. Ning Xiangdong, Mr. Li Hongwu and Mr. Wen Daocai.

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

WEICHAI POWER CO., LTD.

THIRD QUARTERLY REPORT FOR 2019

October 2019

1

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

SECTION 1 IMPORTANT NOTICE

The board of directors, the Supervisory Committee and the directors, supervisors and senior management of the Company warrant that no false presentations or misleading statements are contained herein, nor with any material omissions, and severally and jointly accept responsibilities for the authenticity, accuracy and completeness of the contents of this quarterly report.

All directors have attended the Board meeting in respect of reviewing this quarterly report.

Tan Xuguang, principal of the Company, Kwong Kwan Tong, principal in‐charge of accounting and Li Xia, head of accounting department (in charge person of accounting), warrant that the financial statements contained in the quarterly report are true, accurate and complete.

2

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

SECTION 2 BASIC INFORMATION OF THE COMPANY

2.1 Major accounting data and financial indicators

Whether the Company has made retrospective adjustment or restatement of accounting data of the prior years

□ Yes √No

Unit: RMB

As at the end of the

As at the end of

Change for the end

of reporting

reporting period

last year

period as

compared to end

of last year

Total assets (RMB)

223,726,604,498.05

205,276,365,174.18

8.99%

Net assets attributable to

shareholders of listed company

42,877,114,285.21

39,313,734,834.02

9.06%

(RMB)

Reporting period

Change for the

From the beginning

Change for the period from

reporting period

the beginning of the year

over the

of the year to the

to the end of the reporting

corresponding

end of the reporting

period over the

period of last year

corresponding period of

period

last year

Revenue (RMB)

35,845,761,369.43

-0.20%

126,708,257,889.91

7.21%

Net profit attributable to

shareholders of listed company

1,770,753,119.83

10.07%

7,058,241,497.72

17.61%

(RMB)

Net profit attributable to

shareholders of listed company after

1,494,633,694.65

-0.93%

6,447,076,829.66

13.35%

extraordinary gain/loss (RMB)

Net cash flows from operating

--

--

4,014,711,229.81

-38.15%

activities (RMB)

Basic earnings per share

0.22

10.95%

0.89

18.55%

(RMB/share)

Diluted earnings per share

0.22

10.95%

0.89

18.55%

(RMB/share)

Weighted average return on net

4.15%

-0.18%

17.20%

0.73%

assets

Extraordinary gain/loss items and amounts

√ Applicable □ N/A

3

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Unit: RMB

Item

Amount from the beginning of

Description

the year to the end of the

reporting period

Gains or losses from disposal of non-current assets (including the

part of assets impairment provision already made and written

103,406,089.71

off)

Government subsidy accounted into profit and loss for the

current period, excluding those closely associated with the

140,420,761.47

business of the Company which were given in a fixed amount or

volume in compliance with state standard

Profit and loss from debt restructuring

8,891,743.08

Profit and loss on the changes in fair value generated from

financial assets held for trading, derivative financial assets,

financial liabilities held for trading and derivative financial

liabilities and investment income received from disposal

of financial assets held for trading, derivative financial

436,033,421.23

assets, financial liabilities held for trading, derivative

financial liabilities and other debt investments, other than

effective hedging business relating to ordinary operating

business of the Company

Reversal of impairment provision in respect of receivables and

contract assets for which impairment test is conducted

6,768,474.42

separately

Other non-operating income and expenses other than the above

126,652,586.90

items

Less: Effects of income tax

106,732,364.94

Effects of minority interests (after tax)

104,276,043.81

Total

611,164,668.06

--

Notes for the Company's extraordinary gain or loss items as defined in the Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1 - Extraordinary Gains or Losses and the extraordinary gain or loss items as illustrated in the Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1 - Extraordinary Gains or Losses defined as its recurring gain or loss items

□ Applicable √ N/A

During the reporting period, the Company did not define any extraordinary gain or loss items as defined and illustrated in the Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1 - Extraordinary Gains or Losses as its recurring gain or loss items.

2.2 Total number of shareholders and information on shareholdings of the top ten shareholders as at the end of the reporting period

1. Number of shareholders of ordinary shares and shareholders of preference shares with resumed voting rights and information on shareholdings of the top ten shareholders

4

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Unit: Share

Total number of shareholders of

Total number of shareholders of

preference shares with resumed

ordinary shares as at the end of the

180,939

0

voting rights as at the end of the

reporting period

reporting period, if any

Information on shareholdings of the top ten shareholders

f

Nature of

Number of

Pledged or frozen

Shareholding

Number of

Name of shareholder

ratio

restricted

shareholder

shares held

Status of

Quantity

shares held

shares

HKSCC Nominees Limited

Foreign

24.43%

1,938,406,116

shareholder

Weichai Group Holdings

State-owned legal

17.72%

1,406,100,000

1,345,905,600

Limited

person

Hong Kong Securities

Overseas legal

Clearing Company

person

5.13%

407,084,690

Limited

Weifang Investment

State-owned legal

Group Company

person

3.74%

296,625,408

296,625,408

Limited

China Securities Finance

Domestic non-

Corporation Limited

state-owned legal

2.06%

163,608,906

person

IVM Technical

Overseas

Consultants Wien

1.58%

125,265,203

legal person

Gesellschaft m.b.H

Central Huijin Assets

State-owned

Management Company

legal person

1.37%

108,492,800

Limited

Shandong Enterprise

Domestic

Trust Operation

non-state- owned

0.83%

66,180,960

Company Limited

legal person

Tan Xuguang

Domestic natural

0.74%

58,842,596

44,131,947

person

Hu Zhongxiang

Domestic

natural

0.63%

50,264,177

person

5

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Information on shareholdings of the top ten non-restricted shareholders

Name of shareholder

Number of non-restricted

Types of shares

shares held

Types of shares

Quantity

HKSCC Nominees Limited

1,938,406,116

Overseas listed

1,938,406,116

foreign shares

Hong Kong Securities Clearing Company

407,084,690

RMB

ordinary

407,084,690

Limited

shares

China Securities Finance Corporation

163,608,906

RMB

ordinary

163,608,906

Limited

shares

IVM Technical Consultants Wien

125,265,203

RMB

ordinary

125,265,203

Gesellschaft m.b.H

shares

Central Huijin Assets Management

108,492,800

RMB

ordinary

Company Limited

shares

108,492,800

Shandong Enterprise Trust Operation

66,180,960

RMB

ordinary

66,180,960

Company Limited

shares

Weichai Group Holdings Limited

60,194,400

RMB

ordinary

60,194,400

shares

Hu Zhongxiang

50,264,177

RMB

ordinary

50,264,177

shares

China Merchants Bank Co., Ltd. - Orient

43,424,254

RMB

ordinary

Hong Rui Feng Flexible Allocation Mixed

shares

Securities Investment Fund (LOF) (招商银

43,424,254

行股份有限公司-东方红睿丰灵活配置

混合型证券投资基金(LOF))

Abu Dhabi Investment Authority

37,241,939

RMB

ordinary

37,241,939

shares

Statement on the connected relationship

Among the aforesaid shareholders, Mr. Tan Xuguang is the chairman of Weichai Group

or acting in concert relationship among

Holdings Limited. The Company is not aware whether there is any connected

the aforementioned shareholders

relationship among the aforementioned shareholders, or whether there is any acting in

concert relationship among them.

Description of top 10 shareholders'

Among the top 10 shareholders of the Company, Hu Zhongxiang held 49,369,177 shares

involvement in financing and securities

through a client credit trading guarantee securities account of China Galaxy Securities

lending businesses

Co., Ltd..

Whether any of the top ten shareholders of ordinary shares and the top ten non-restricted shareholders of ordinary shares of the Company conducted any transactions on agreed repurchases during the reporting period

□ Yes √ No

None of the top ten shareholders of ordinary shares or the top ten non-restricted shareholders of ordinary shares of the Company conducted any transactions on agreed repurchases during the reporting period.

2. Total number of shareholders of preference shares and information on shareholdings of the top ten shareholders of preference shares as at the end of the reportingperiod

□ Applicable √ N/A

6

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

SECTION 3 IMPORTANT EVENTS

3.1 Information on and reasons for the changes of financial statistics and financial indicators during the reporting period

√ Applicable □ N/A

Unit: RMB

Item on Statements

As at the end of

As at the end of

Percentage

Reason

the reporting

last year

change

period

Financial assets held for trading

It is mainly attributable to the

increase in structured deposits

in the current period.

5,915,503,031.17

4,115,199,600.23

43.75%

Construction in progress

It is mainly attributable to the

5,523,692,606.42

2,848,101,239.62

93.94%

increase

in

investments

in

some construction projects of

the Company in the current

year.

Short-term loans

It is mainly attributable to the

8,037,340,704.45

5,472,765,901.24

46.86%

general

working

capital

requirements.

Long-term payables

It is mainly attributable to the

3,520,442,033.45

9,895,419,535.20

-64.42%

effect of implementation of

new lease standards.

Item on Statements

From the beginning

Corresponding

Percentage

Reason

of year to the end of

period of last year

change

the reporting period

Research & development expenses

3,585,775,633.45

2,684,165,691.90

33.59%

It is mainly attributable to the

increase in research and

development expenditure

during the period.

Finance expenses

It is mainly attributable to the

increase

in

structured

141,092,090.41

99,589,936.90

41.67%

deposits in the current period

and the

recognition

of

interest income in investment

income.

Investment income

It is mainly attributable to the

490,916,366.16

336,382,718.03

45.94%

increase

in

income

of

structured

deposits

in

the

current period.

7

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Gain on change of fair value

127,437,168.43

27,992,650.96

355.25%

It is mainly attributable to the

increase in gain on cross

currency swap instruments.

Impairment loss of assets

It is mainly attributable to the

-389,707,627.13

-266,412,361.68

-46.28%

increase in provision for decline in

value of inventories.

Net cash flows from operating

It is mainly attributable to the

activities

4,014,711,229.81

6,491,451,894.12

-38.15%

impact caused by the time

point of cash collection from

sales of merchandises.

Net cash flows from investing

It is mainly attributable to the

activities

-6,687,742,942.65

-4,566,690,774.44

-46.45%

increase in structured deposits

and acquisition of fixed assets

in the current period.

3.2 Analysis and description on the progress of important events, their impacts and solutions

□ Applicable

√ N/A

Progress of implementation of share repurchase

□ Applicable

√ N/A

Progress of implementation of the disposal of repurchased shares by way of centralized bidding

□ Applicable

√ N/A

3.3 Commitments made by the Company's de facto controllers, shareholders, connected parties, acquirers entities and other related committing parties not yet implemented during the reporting period

√ Applicable

□ N/A

The

Commitments

Type of

Contents of commitments

Time of

Period of

Implementation

commitment

by

commitment

commitments

commitments

situation

Other commitments

Shaanxi

Other

I. Issues relating to the qualification of

9 April 2007

Before 30 June

Implementation

to medium and

Automotive

commitments

Shaanxi Zhongqi: 1. The business scope

2007

of commitments

minority

of Shaanxi Zhongqi covers the

Group Co.,

production and sale of full-set

was not yet

shareholders of the

Ltd., Shaanxi

automobiles ("Sale and export trade

completed.

Company

(licensed operation) of automobiles

Heavy-duty

(excluding sedans), auto parts and

Motor

components and engines produced by

the company" as stated in its Business

Company

License of Corporate Legal

Limited

8

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Person). According to the announcement "Vehicle Manufacturers and Products" made by the State Development and Reform Commission (the "SDRC"), Shaanxi Automotive, the other shareholder of Shaanxi Zhongqi, remained as the manufacturer of the "Shaan-qi" branded automobiles. 2. In establishing Shaanxi Zhongqi jointly with TAGC, the contribution from Shaanxi Automotive was represented by the operating assets relating to the operation of heavy-duty automobile production, whereas the corresponding undertakings and human resources were taken over by Shaanxi Zhongqi. Whilst the qualification of Shaanxi Automotive for producing and selling heavy-dutyfull-set automobile products shall be succeeded by Shaanxi Zhongqi, the formalities for the change of qualification have not been completed under the influence of the "Delong-league" crisis and other factors. Shaanxi Automotive has committed to cooperate in procuring the change of qualification as mentioned above according to the law.

II. Issues relating to land lease:

1. Shaanxi Zhongqi leased from Shaanxi Automotive land parcels and buildings located in No. 39 and No. 71 of Xingfu Bei Road in Xincheng District, Xi'an City and Caojia Town in Qishan County. 2. Shaanxi Automotive failed to provide the relevant title documents including property ownership certificates, land use certificates or leasing registration certificates, etc. 3. Shaanxi Automotive and Shaanxi Zhongqi undertook that they shall fully negotiate and communicate with local governments to seek elimination of the irregularities existing in the leased land and properties, within the shortest possible timeframe. Where losses are suffered by Shaanxi Zhongqi in this regard, Shaanxi Automotive shall be responsible for its full compensation.

Shaanxi Fast

Other

1.Shaanxi Fast Gear Co., Ltd., a

1 December

One year

Implementation

subsidiary controlled by the Company

of commitments

commitments

2006

Gear Co., Ltd.

leased from Shaanxi Auto Gear General

was not yet

Works (currently named Shaanxi Fast

completed.

Gear Automotive Transmission Co.,

Ltd., and hereinafter "Fast

Transmission") two parcels of land

located in Daqing Road, Lianhu District,

Xi'an City and Wu Zhang

9

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Yuan Town in Qishan County and

Shucang Village in Baoji County, both in

Shaanxi Province. The aforesaid two

parcels of land were acquired by Fast

Transmission by way of allocation, but

Fast Transmission failed to provide

competent government authorities

with documents testifying agreed

leasing of the land use rights

concerning such allocated land.

2. SFGC leased from Fast

Transmission buildings located in the

west section of Daqing Road, Lianhu

District, Xi'an City and Wu Zhang Yuan

Town in Qishan Country and Shucang

Village in Baoji County. For some of the

buildings, title documents including

property ownership certificates,

corresponding land use right certificates

and leasing registration etc. have not

yet been obtained. 3. Fast Transmission

and SFGC

undertook to fully negotiate

and communicate with the local

governments to seek lawful and

effective regulations or adjustments to

the leasing of land and properties

within one year and seek elimination of

the existing circumstances of

irregularities in respect of the leasing of

land parcels and properties.

During the merger by absorption with

TAGC, Weichai Power built some

Other

properties on a parcel of land acquired

One year

Implementation

Weichai

by way of land grant, allocation and

1 December

commitments

leasing which is to the west of Weizhou

2006

of commitments

Power Co.,

was not yet

Road and to the south of Min Sheng

completed.

Ltd.

Road East Street by Weifang Diesel

Engine Factory (currently named

Weichai Group Holdings Limited, and

hereinafter "Weichai Group").

Application has been made by Weichai

Power for the grant (transfer) of six

parcels of land under Weichai Group

where the aforesaid buildings are

located, to obtain the land use rights by

way of land grant to the aforesaid land

parcels.

Whether the

No

commitments have

been implemented

timely

10

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

If implementation of commitments is not yet completed, state detailed reasons for not completing implementation of commitments and next plan

  1. Regarding the commitments made by Shaanxi Automotive Group Co., Ltd. and Shaanxi Heavy‐duty Motor Company Limited According to the Decision Concerning the Administrative and Regulatory Measures under No. (2014) 9 issued by Shandong Regulatory Bureau of China Securities Regulatory Commission (《中国证券监督管理委员会山东监管局(20149 号 行政监管措施决定书》), Shaanxi Automotive Group, through Weichai Power Co., Ltd., issued announcements in designated media on 13 August 2014, stating the reasons for not implementing the commitments, updates on progress, next solutions and relevant risk factors as follows: "I. Since 2007, Shaanxi Automotive has striven to transfer the qualification for producing full-set heavy-dutyvehicles to Shaanxi Heavy-dutyMotor Company Limited, a controlling subsidiary of Weichai Power. However, in actual practice, due to the change of austerity measures and industry policies of the state, competent authorities including the State Development and Reform Commission and the Ministry of Industry and Information Technology do not permit the segregation and partial transfer of qualification with respect to full-setautomobile. As such, the "change of holder of sale and production qualification in respect of full- set heavy-dutyvehicle products to Shaanxi Heavy-dutyMotor Company Limited, a controlling subsidiary of Weichai Power Co., Ltd." as stated in the Decision Concerning the Administrative and Regulatory Measures under No. (2014) 92 issued by Shandong Regulatory Bureau of China Securities Regulatory Commission( 中国证券监督管理委员会山东监管局(201492 号行政监管措施决定书》) has not been completed due to the aforesaid policy ground albeit efforts made by various parties. Going forward, the Company will actively trace the changes of state policies applicable to the automobile industry. Once permitted under policies, we commit that transfer of sale and production qualification in respect of full-set heavy-dutyvehicles will be completed within half a year. II. Since its establishment in 2002, Shaanxi Heavy-dutyMotor Company Limited has undergone rapid and healthy development and fully safeguarded the interests of investors. The qualification issue has never had any impact on the normal operation and development of the company. This management approach has also won recognition from competent state authorities. Shareholders from both sides and relevant regulatory bodies have been satisfied with the operation, development and result of performance of the company. III. The land and buildings located at No. 39 and No. 71 of Xingfu Bei Road in Xincheng District, Xi'an City, Shaanxi Province are listed under the "Comprehensive Renovation Work Plan for the Neighborhood at Xingfu Road (《幸福路地区综合改造工作方案》)" in accordance with the Notice Concerning the Issuance of Comprehensive Renovation Work Plan for the Neighborhood at Xingfu Road (《关于印发幸福路地区综合改造工作方案的通 知》) under Shi Zheng Bang Fa No. (2013) 89 issued by the General Office of Xi'an People's Government, requiring enterprises to complete removal by the due date, and the relevant matters shall be implemented according to the government's arrangements. Shaanxi Heavy-dutyMotor Company Limited moved to its registered address namely Jingwei Industrial Park, Economic and Technological Development Zone, Xi'an in 2006 and obtained state-ownedland use right in respect of land parcels occupying approximately 2,700 mu, satisfying its operation and development needs. Regarding the aforesaid matters, the company will lawfully issue announcement in a timely manner through Weichai Power Co., Ltd."
  2. Regarding the commitments made by Shaanxi Fast Gear Co. Ltd. According to the Decision Concerning the Administrative and Regulatory Measures under No. (2014) 10 issued by Shandong Regulatory Bureau of China Securities Regulatory Commission (《中国证券监督管理委员会山东监管局(201410 号行政监管措施决定书》), Fast Transmission, through Weichai Power Co., Ltd., stated the reasons for not implementing the commitments, updates on progress, next solutions and relevant risk factors as follows: " I. Regarding the regulations on the land and parcels and buildings located in Daqing Road, Lianhu District, Xi'an City and Wu Zhang Yuan Town in Qishan County and Shucang Village in Baoji County, both in Shaanxi Province, which were originally committed by the group for leasing to Shaanxi Fast Gear Co., Ltd., a controlling subsidiary of Weichai Power Co., Ltd., to date, the land use right certificates and property ownership certificates for the buildings located in Wu Zhang Yuan Town in Qishan County and Shucang Village in Baoji County, both in Shaanxi Province have been completed. The land use right certificate for the land parcels in Daqing Road, Lianhu District, Xi'an City has been completed, but the property ownership certificate is on hold as suggested by the government because Lianhu District is located in the zone that has been designated as part of the government's removal area. The factories located in Lianhu District, Xi'an City, Shaanxi Province has been, in accordance with the Notice by Xi'an People's Government Concerning the Administration of the Construction Projects in the Comprehensive Renovation Zone in Tumen Area(《西安市人民政府关于加强土门地区综合改造 区域建设项目管理的通告》) under Shi Zheng Gao No. [2013] 4 issued by Xi'an People's Government, the land parcel has been included under the Working Plan of the Comprehensive Renovation of Tumen Area, requiring enterprises to complete removal by the due date, and the relevant matters shall be implemented according to the government's arrangements. The company shall remove on a planned and step-by-step basis and this will not affect the production operation and development of Shaanxi Fast Gear Co. Ltd. II. The group is a wholly state-owned enterprise and its reform and development has been strongly supported by Shaanxi Government and the local government for its region. Its land and properties have been endorsed by the local government and are not subject to risks. The group commits, once again, that it shall bear all losses to be incurred as a result of any failure to normally use/ failure to use those land parcels and buildings by Shaanxi Fast Gear Co. Ltd. which is in turn due to any claim of rights over those land parcels and buildings made by any third parties or imposition of any penalty by the relevant government bodies during the leasing period. Regarding the aforesaid matters, the group will lawfully issue announcement in a timely manner through Weichai Power Co., Ltd. "

11

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

3. Regarding the commitments made by Weichai Power The 6 parcels of land proposed to be granted have been listed by Weifang People's Government as part of the overall planning for land use under the government's "From City to Industrial Park" initiative, and legal procedures for granting land to Weichai Power will no longer proceed. During the transitional period under the staged implementation of the overall planning of the "From City to Industrial Park" initiative, Weichai Power shall continue to lease those land parcels in the original manner. According to the further communication between the Company and the government, the Company shall implement, by stages, the overall planning of the government's "From City to Industrial Park" initiative.

12

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

3.4. Investments in securities

√ Applicable

□ N/A

Unit: RMB

Gain or

loss on fair

Accumulated fair

Purchase

Sale

Carrying value at

value

value changes

Gain/loss

Type of

Stock

Short

Initial Investment

Accounting

amount

amount

Carrying value at

Accounted

securities

code

cost

method

the beginning of

changes

included in

for the

for the

the end of period

for under

Source

name

for the

period

arising

equity during

period

period

period

during the

the period

period

Domestic

600166

Foton

194,000,000.00

Fair value

Investment

and

in other

overseas

Motor

measurement

equity

Internal

instruments

equity

145,600,000.00

12,800,000.00

158,400,000.00

funding

Domestic

000425

XCMG

1,199,540,273.14

Fair value

Investment

and

measurement

Internal

1,006,304,269.98

411,690,684.76

1,417,994,954.74

in other

overseas

funding

equity

equity

instruments

Total

1,393,540,273.14

--

1,151,904,269.98

424,490,684.76

1,576,394,954.74

--

--

3.5. Entrusted wealth management

□Applicable

√ N/A

The Company had no entrusted wealth management in the reporting period.

13

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

3.6. Investments in derivatives

Applicable

□ N/A

Unit: in ten thousand RMB

Name of

Proportion of

Whether or

Type of

Initial

Investment

Amount

Amount

Amount of

investment

to

Actual amount of

operators

Connection

not a

acquired

disposed of

Investment

the net asset of

profit and loss

Derivatives

provision for

of derivatives

connected

Investment

Effective Date

Expiry Date

at

the

during the

during the

at the end of

the Company at

during the

investment

transaction

investment

amount of

beginning

of

reporting

reporting

impairment

the Period

the end of the

reporting period

derivatives

the Period

period

period

(if any)

reporting period

investment

The Hong Kong

and

Shanghai

Banking

30

30

Corporation

Limited,

the

No

No

Cross

Currency

0.00 September

September

-16,132.92

2,478.12

0.04%

18,415.50

Bank of China,

Swap Business

2015

2020

Barclays

The Hong Kong

14

14

and Shanghai

Banking

September

September

Corporation

Limited,

2017

2022

Australia and

No

No

0.00

8,523.64

44,679.25

0.67%

36,024.30

New Zealand

Cross Currency

Banking Group

Swap Business

Limited, BNP

Paribas, JP

Morgan

Overseas

Cash flow

hedge in

non-

connecting

No

No

respect of

0.00

1 January

2019-2020

1,923.37

-2,496.72

-0.04%

-19,230.62

financial

forward

institutions

2017

etc.

exchange

contracts

Overseas

21 February

2020-2024

non-

connecting

No

No

Interest

rate

0.00

2017

-6,169.55

-11,962.56

-0.18%

-12,359.60

financial

swaps hedging

institutions

etc.

Overseas

22 June 2018

1 June 2025

non-

connecting

No

No

Fair

value

0.00

823.38

2,137.72

0.03%

6,809.83

financial

hedging

institutions

etc.

Domestic

Structured

27 April 2018

27 March 2020

connecting

No

No

1,643,700.00

361,500.00

1,282,200.00

1,123,200.00

517,000.00

7.75%

16,592.73

financial

deposit

institution

Total

1,643,700.00

--

--

350,467.92

1,282,200.00

1,123,200.00

551,835.81

8.27%

46,252.16

Source of derivatives investment

Internal

funding

funding

Litigation involved (if applicable)

Not applicable

Date of the announcement disclosing

23 September 2015

31 August 2017

the approval by the board of directors of

derivatives investment by the Board (if

22 August 2018

11 January 2019

any)

Risk analysis of positions in derivatives

during the reporting period and

There is appropriate internal control system for the management of the Company to control the relevant

explanations of risk control measures

risks. At the end of reporting period, there was no significant exposure for the positions in derivatives of the

(including but not limited to market risk,

liquidity risk, credit risk, operation risk,

Company.

legal risk etc.)

14

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

In the course of valuation, the Company adopted valuation techniques which were appropriate

in the

circumstances and for which sufficient data and other information were available for measurement,

selecting inputs which were consistent with the characteristics of the assets and liabilities contemplated by

market participants under the relevant assets or liabilities transactions. Priorities should be given to the

use of relevant observable inputs. Where the relevant observable inputs could not be obtained in a

practicable manner or at all, unobservable inputs would be used instead.

(1) On 1 July 2016, Weichai International Hong Kong Energy Group Co., Limited ("Hong Kong Energy") , a

subsidiary of the Company, used the 2015 bond cross currency swaps as hedging instrument, and

conducted cash flow hedging on the foreign currency bond amounting to USD400 million against the cash

flow fluctuation incurred by change in exchange rates. From January to September 2019, the gain on the

changes in fair value of the hedging instruments recognized in other comprehensive income amounted to

RMB184,155,042.15 (EUR23,754,565.89). The amount included in the statement of profit and loss for the

current period was RMB116,624,473.45 (EUR15,034,648.58). There was no material invalid hedge for the

period. Key parameters of assumption included interest payment ratio, interest receipt ratio, frequency of

interest receipt, frequency of interest payment, USD interest rate curve, EUR interest rate curve, USD/EUR

exchange rate curve etc.

(2) The effective date of 2017 bond cross currency swaps contract of Weichai International Hong Kong

Energy Group Co., Limited ("Hong Kong Energy"), a subsidiary of the Company, was 14 September 2017.

The gain on the changes of fair value from January to September 2019 amounted to RMB360,243,027.80

(EUR46,760,517.62). Key parameters of assumption included interest payment ratio, interest receipt ratio,

frequency of interest receipt, frequency of interest payment, USD interest rate curve, EUR interest rate

Changes in market price or product fair

curve, USD/EUR exchange rate curve etc.

value of invested derivatives during the

(3) At the inception of hedging, KION Group AG, a subsidiary of the Company, conducted cash flow hedging

reporting period, where specific methods

on forward currency contracts designated to the exchange rate risk of forecast sale, forecast purchase and

and

relevant

assumptions

and

firm commitment. From January to September 2019, the post-tax loss on the changes in fair value of the

parameters used shall be disclosed in the

hedging instruments recognized in other comprehensive income amounted to RMB30,425,911.20

analysis of derivatives' fair value

(EUR3,924,000.00). The post-tax included in the profit or loss for the current period was

RMB25,657,324.20 (EUR3,309,000.00). There was no material invalid hedge for the period. Key parameters

of assumption included contracted exchange rate, prevailing forward exchange rate, discount rate etc.

(4) KION Group AG, a subsidiary of the Company, conducted cash flow hedging on interest rate swap

contracts designated to the interest rate risk of the floating-rate borrowings for acquiring Dematic Group,

a subsidiary of the Company. From January to September 2019, the amount after tax loss on the changes

in fair value of the hedging instruments recognized in other comprehensive income amounted to

RMB50,841,666.60 (EUR6,557,000.00). No amount was taken to profit or loss during the current period.

There was no material invalid hedge for the period. Key parameters of assumption included contracted

sum of payment, forward interest rate, discount rate etc.

(5) On 22 June 2018, KION Group AG, a subsidiary of the Company, entered into interest rate swap

contracts to conduct fair value hedging designated on the interest rate risk of the fixed-ratemedium-term

notes with a face value of EUR100,000,000.00 issued this period. On 30 September 2019, the aforesaid

hedged items of the Group were presented as bonds payable in the financial statements of the Group with

a carrying value of RMB615,333,814.20 (EUR79,359,000.00). The carrying value of the adjustment of

changes in fair value of the hedged items taken to the hedged items was RMB121,277,185.80

(EUR15,641,000.00). There was no material invalid hedge for the current period. Key parameters of

assumption included contracted sum of payment, forward interest rate, discount rate etc.

There was a high degree of transparency of the market changes of the subject linked to the structured

deposit business conducted by the Company with active transactions, whose fair values could be

determined based on the prices provided or obtained by intermediary financial institutions such as banks.

Explanations of any significant changes

in the Company's accounting policies

and specific accounting and auditing

No change

principles on derivatives between the

reporting period and the last reporting

period

For details, please refer to the "Independent opinion on the Company's relevant matters by independent

Specific

opinions of independent

directors of Weichai Power Co., Ltd." disclosed by the Company on 31 August 2017 and the "independent

Directors

on the derivatives investment

opinion on the launch of derivative trading business by a controlling subsidiary of the Company by

and risk control of the Company

independent directors of Weichai Power Co., Ltd." disclosed by the Company on 22 August 2018 and 11

January 2019.

15

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

3.7. Meetings with researchers, public relations and interviews during the reportingperiod

Applicable

□ N/A

Time

Way of reception

Type of guests

Basic information of research

3 July 2019

On-site research

Corporation

For details, please refer to the Logbook

of Investor Relations Activities as of 3 July 2019

disclosed by the Company on CNINFO website

9 July 2019

On-site research

Corporation

For details, please refer to the Logbook of Investor

Relations Activities as of 9 July 2019

(I) disclosed by the Company on CNINFO website

9 July 2019

On-site research

Corporation

For details, please refer to the Logbook

of Investor Relations Activities as of 9 July 2019 (II)

disclosed by the Company on CNINFO website

15 July 2019

On-site research

Corporation

For details, please refer to the Logbook of Investor

Relations Activities as of 15 July 2019 disclosed by

the Company on CNINFO website

2 September 2019

On-site research

Corporation

For details, please refer to the Logbook

of Investor Relations Activities as of 2 September

2019 disclosed by the Company on CNINFO

website

3 September 2019

On-site research

Corporation

For details, please refer to the Logbook of Investor

Relations Activities as of 3 September 2019

disclosed by the Company on CNINFO website

11 September

On-site research

Corporation

For details, please refer to the Logbook of Investor

2019

Relations Activities as of 11 September 2019

disclosed by the Company on CNINFO website

17 September

On-site research

Corporation

For details, please refer to the Logbook of Investor

2019

Relations Activities as of 17 September 2019 (I)

disclosed by the Company on CNINFO website

17 September 2019

On-site research

Corporation

For details, please refer to the Logbook

of Investor Relations Activities as of 17 September

2019 (II) disclosed by the Company on CNINFO

website

17 September 2019

On-site research

Corporation

For details, please refer to the Logbook of Investor

Relations Activities as of 17 September 2019 (III)

disclosed by the Company on CNINFO

website

  • 3.8. External guarantees in violation ofregulations

  • ApplicableN/A

The Company did not have external guarantees in violation of regulations during the reporting period.

  • 3.9. Non‐operating funds of the listed company occupied by its controlling shareholders and their associates

  • ApplicableN/A

There were no non-operating funds of the listed company occupied by its controlling shareholders and their associates during the reporting period.

16

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

SECTION 4 FINANCIAL STATEMENTS

4.1 Financial Statements 4.1.1 Consolidated balance sheet Prepared by: WEICHAI POWER CO., LTD.

30 September 2019

Unit: RMB

Item

30 September 2019

31 December 2018

Current assets:

Cash and cash equivalents

35,656,958,528.19

38,209,952,558.31

Settlement provisions

Capital lent to other financial institutions

Financial assets held for trading

5,915,503,031.17

4,115,199,600.23

Derivative financial assets

Notes receivable

24,848,850,968.78

18,056,440,277.52

Accounts receivable

19,295,903,607.45

13,155,363,494.20

Receivable financing

2,299,143,910.96

6,936,224,398.10

Prepayments

1,159,734,063.57

1,109,227,313.17

Insurance receivables

Reinsurance receivables

Contract reserve of reinsurance receivables

Other receivables

1,022,970,240.33

1,087,148,524.03

Incl.: Interests receivable

133,708,638.09

23,747,780.97

Dividends receivable

16,081,381.20

1,608,696.50

Purchase restituted financial assets

Inventories

21,186,964,785.77

20,674,287,133.47

17

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Contract assets

1,415,293,360.20

935,892,539.90

Held-for-sale assets

24,237,289.50

5,525,306.60

Non-current assets due within one year

2,603,842,347.00

2,127,858,173.40

Other current assets

1,599,308,448.41

1,692,343,618.45

Total current assets

117,028,710,581.33

108,105,462,937.38

Non-current assets:

Granted loans and advances

Debt investments

Available-for-sale financial assets

Other debt investments

Held-to-maturity investments

Long-term receivables

7,824,444,871.80

6,483,298,008.60

Long-term equity investments

4,686,360,335.24

4,463,591,313.13

Investments in other equity instruments

1,775,509,890.12

1,315,633,672.96

Other non-current financial assets

238,413,842.40

192,949,412.40

Investment property

566,170,937.52

593,459,307.58

Fixed assets

23,678,864,995.18

29,454,072,247.73

Construction in progress

5,523,692,606.42

2,848,101,239.62

Productive biological assets

Oil and gas assets

Right-of-use assets

9,190,483,078.33

Intangible assets

22,799,609,031.32

23,299,455,749.37

Development expenditure

443,197,596.11

440,148,223.16

Goodwill

23,407,800,301.60

23,037,386,296.04

Long-term prepaid expenses

221,610,611.13

228,459,134.85

Deferred tax assets

5,829,503,167.00

4,458,451,001.33

Other non-current assets

512,232,652.55

355,896,630.03

Total non-current assets

106,697,893,916.72

97,170,902,236.80

Total assets

223,726,604,498.05

205,276,365,174.18

Current liabilities:

Short-term loans

8,037,340,704.45

5,472,765,901.24

Loans from central bank

Capital borrowed from other financial

institutions

18

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Financial liabilities held for trading

108,336,617.04

213,435,765.47

Derivative financial liabilities

Notes payable

22,117,720,837.24

15,925,016,265.08

Accounts payable

28,872,740,086.94

30,869,354,934.85

Advance from customers

Contract liabilities

7,296,850,543.43

8,722,443,043.80

Selling financial assets of repurchase

Absorbing deposit and interbank deposit

Security trading commission

Security underwriting fees

Payroll payables

5,074,653,405.17

5,184,666,613.19

Taxes payable

2,378,597,714.24

2,506,794,642.37

Other payables

6,938,507,825.18

6,502,173,092.72

Incl.: Interests payable

66,804,543.21

101,293,322.06

Dividends payable

1,199,786,998.30

295,006,756.48

Handling fees and commission payable

Reinsurance payables

Held-for-sale liabilities

Non-current liabilities due within one year

8,922,348,495.17

6,898,699,368.61

Other current liabilities

6,133,084,348.48

6,121,799,350.16

Total current liabilities

95,880,180,577.34

88,417,148,977.49

Non-current liabilities:

Insurance contract reserve

Long-term borrowings

9,379,550,281.45

10,908,512,233.85

Bonds payable

13,085,248,978.50

12,265,020,075.27

Incl: Preference shares

Perpetual bonds

Lease liabilities

9,288,616,477.23

Long-term payables

3,520,442,033.45

9,895,419,535.20

Long-term payroll payable

11,982,082,005.15

9,580,057,732.13

19

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Provisions

335,972,154.00

364,979,471.20

Deferred income

4,388,447,620.29

3,256,007,618.70

Deferred tax liabilities

5,749,330,198.00

5,772,705,450.50

Other non-current liabilities

3,353,562,696.96

2,557,186,306.15

Total non-current liabilities

61,083,252,445.03

54,599,888,423.00

Total liabilities

156,963,433,022.37

143,017,037,400.49

Equity holders' interest:

Share capital

7,933,873,895.00

7,997,238,556.00

Other equity instruments

Incl: Preference shares

Perpetual bonds

Capital reserves

107,758,719.83

113,699,432.76

Less: Treasury stock

499,911,217.21

Other comprehensive income

-1,559,474,019.25

-1,570,594,557.01

Special reserves

185,567,940.07

155,056,854.10

Surplus reserves

237,736,834.40

674,283,390.61

General risk provision

Retained earnings

35,971,650,915.16

32,443,962,374.77

Total equity attributable to equity holders of parent

42,877,114,285.21

39,313,734,834.02

company

Minority interests

23,886,057,190.47

22,945,592,939.67

Total equity holders' interests

66,763,171,475.68

62,259,327,773.69

Total liabilities and equity holders' interests

223,726,604,498.05

205,276,365,174.18

Legal representative: Tan Xuguang

Principal in charge of accounting: Kwong Kwan Tong

Head of accounting department: Li Xia

4.1.2 Balance sheet of the parent company

Unit: RMB

Item

30 September 2019

31 December 2018

Current assets:

Cash and cash equivalents

16,263,709,387.37

19,192,409,975.78

Financial assets held for trading

Derivative financial assets

Notes receivable

22,059,588,642.72

21,026,407,121.15

20

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Accounts receivable

5,986,384,175.01

1,069,759,568.00

Receivable financing

Prepayments

269,546,338.88

385,395,385.93

Other receivables

339,932,292.38

501,826,716.43

Incl.: Interests receivable

120,399,175.58

10,662,718.08

Dividends receivable

292,560,465.75

Inventories

1,765,734,236.74

1,971,178,990.99

Contract assets

Held-for-sale assets

Non-current assets due within one

year

Other current assets

164,194,933.94

Total current assets

46,684,895,073.10

44,311,172,692.22

Non-current assets:

Debt investments

Available-for-sale financial assets

Other debt investments

Held-to-maturity investments

Long-term receivables

Long-term equity investments

15,029,178,616.64

14,531,123,322.77

Investments in other equity

182,882,200.00

170,082,200.00

instruments

Other non-current financial assets

Investment property

1,115,733,669.95

1,372,826,553.46

Fixed assets

2,717,878,702.02

2,561,908,781.20

Construction in progress

2,150,731,689.53

922,996,632.68

Productive biological assets

Oil and gas assets

Right-of-use assets

Intangible assets

514,695,628.81

447,349,640.19

Development expenditure

Goodwill

341,073,643.76

341,073,643.76

Long-term prepaid expenses

Deferred tax assets

1,100,763,670.02

949,075,808.16

Other non-current assets

2,266,184,774.12

2,266,184,774.12

21

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Total non-current assets

25,419,122,594.85

23,562,621,356.34

Total assets

72,104,017,667.95

67,873,794,048.56

Current liabilities:

Short-term loans

Financial liabilities held for trading

Derivative financial liabilities

Notes payable

12,289,762,938.36

11,756,416,668.11

Accounts payable

9,963,841,226.66

9,543,570,906.39

Advance from customers

Contract liabilities

1,254,007,887.89

1,481,303,661.91

Payroll payables

907,340,147.47

916,685,488.49

Taxes payable

464,776,335.00

569,997,419.03

Other payables

3,014,960,849.93

1,783,055,862.95

Incl.: Interests payable

Dividends payable

1,190,081,084.25

Held-for-sale liabilities

Non-current liabilities due within

one year

Other current liabilities

1,688,459,561.00

1,681,702,830.61

Total current liabilities

29,583,148,946.31

27,732,732,837.49

Non-current liabilities:

Long-term borrowings

Bonds payable

Incl: Preference shares

Perpetual bonds

Lease liabilities

Long-term payables

5,515,822.60

5,515,822.60

Long-term payroll payable

23,114,750.75

13,444,746.89

Provisions

Deferred income

865,961,026.91

803,454,411.80

Deferred tax liabilities

Other non-current liabilities

Total non-current liabilities

894,591,600.26

822,414,981.29

Total liabilities

30,477,740,546.57

28,555,147,818.78

22

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Equity holders' interest:

Share capital

7,933,873,895.00

7,997,238,556.00

Other equity instruments

Incl: Preference shares

Perpetual bonds

Capital reserves

695,679,231.81

1,084,612,950.62

Less: Treasury stock

499,911,217.21

Other comprehensive income

-78,324,424.61

-47,258,130.00

Special reserves

88,990,939.63

74,867,864.57

Surplus reserves

2,871,365,767.98

2,811,115,722.19

Retained earnings

30,114,691,711.57

27,897,980,483.61

Total equity holders' interests

41,626,277,121.38

39,318,646,229.78

Total liabilities and equity holders'

72,104,017,667.95

67,873,794,048.56

interests

4.1.3 Consolidated income statement for the period

Unit: RMB

Item

Amount for current Period

Amount for corresponding period of last

year

1. Total revenue

35,845,761,369.43

35,918,554,341.41

Including: Revenue

35,845,761,369.43

35,918,554,341.41

Interest income

Premium income earned

Handling fees and

commission income

2. Total cost of sales

33,122,408,568.27

33,174,694,137.96

Including: Cost of sales

27,652,679,995.15

28,271,747,409.19

Interest expenses

Handling fees and

commission expenses

Payments on surrenders

Claim expenses-net

Provision for insurance

liability reserve-net

Policyholder dividends

23

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Expenses for reinsurance

Taxes and surcharges

94,584,195.57

107,133,183.00

Distribution and selling

2,575,151,869.30

2,406,362,808.94

expenses

General and administrative

1,612,209,191.87

1,413,473,075.20

expenses

Research & development

1,188,033,797.19

933,033,239.02

expenses

Finance expenses

-250,480.80

42,944,422.61

Incl.: Interest expenses

326,993,576.74

312,109,006.81

Interest income

261,694,899.19

259,934,641.98

Add: Other income

50,300,268.90

50,232,431.23

Investment income (losses are

118,217,864.82

115,206,712.19

indicated with "-" )

Including: Share of profit of

associates and jointly- controlled

18,793,734.03

22,724,984.03

enterprises

Income from

derecognition of financial assets at

amortised cost

Foreign exchange gains (losses

are indicated with "-" )

Gains on net exposure hedging

(losses are indicated with "-" )

Gains on fair value changes

101,930,133.65

1,118,814.71

(losses are indicated with "-" )

Credit impairment losses

45,038,064.85

-57,120,636.32

(losses are indicated with "-" )

Asset impairment losses (losses

-122,454,416.47

-87,086,144.06

are indicated with "-" )

Gain on disposal of assets

-11,303,114.10

3,319,788.02

(losses are indicated with "-")

3. Operating profit (losses are indicated

2,905,081,602.81

2,769,531,169.22

with "-")

Add: Non-operating income

83,742,907.07

47,220,342.61

Less: Non-operating expenses

21,788,428.13

49,560,954.89

4. Total profits (total losses are indicated

2,967,036,081.75

2,767,190,556.94

with "-")

24

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Less: Income tax expenses

530,671,332.87

602,032,872.18

5. Net profits (net losses are indicated

2,436,364,748.88

2,165,157,684.76

with "-")

(1) Breakdown by continuity of

operations

1. Net profit from continuing

2,436,364,748.88

2,165,157,684.76

operations (net losses are with "-")

2. Net profit from discontinued

operations (net losses are indicated with

"-")

(2) Breakdown by attributable

interests

1.

Net profit attributable to

1,770,753,119.83

1,608,704,023.13

owners of the parent

2.

Minority interests

665,611,629.05

556,453,661.63

6. Net other comprehensive income after

-301,215,455.50

714,688,474.38

tax

Net other comprehensive income

attributable to shareholders of the

-113,756,305.74

226,066,827.42

parent after tax

(1) Those other comprehensive

income not to be reclassified into profit

-390,400,579.93

24,344,118.99

or loss

1. Changes arising from

-331,888,293.00

56,822,008.09

re- measurement of defined benefit plan

2. Other comprehensive

income not to be reclassified into profit

or loss using the equity method

3. Change in fair value of

-58,512,286.93

-32,477,889.10

investment in other equity instruments

4.Change in fair value of

credit risk of enterprise

5. Others

(2) Those other comprehensive

income to be reclassified into profit or

276,644,274.19

201,722,708.43

loss

1. Other comprehensive

income to be reclassified into profit or

-10,543.50

700,051.59

loss using the equity method

25

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

2. Change in fair value of

other debt investments

3.

Change in fair value of

available- for-sale financial assets

4.

Amount of financial assets

to be reclassified and taken to other

comprehensive income

5.

Gains or losses on

reclassification of held-to-maturity

investments to available-for-sale

financial assets

6.

Provision for impairment

of credit in respect of other debt

investments

7.

Cashflow hedging reserve

6,581,873.94

47,606,056.57

8.

Exchange differences on

270,072,943.75

153,416,600.27

foreign currency translation

9.

Others

Net other comprehensive income

-187,459,149.76

488,621,646.96

attributable to minority interest after tax

7. Total comprehensive income

2,135,149,293.38

2,879,846,159.14

Total comprehensive income

1,656,996,814.09

1,834,770,850.55

attributable to owners of the parent

Total comprehensive income

478,152,479.29

1,045,075,308.59

attributable to minority interest

8. Earnings per share:

(1) Basic earnings per share

0.22

0.20

(2) Diluted earnings per share

0.22

0.20

Legal representative: Tan Xuguang

Principal in charge of accounting: Kwong Kwan Tong

Head of accounting department: Li Xia

26

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

4.1.4 Income statement of the parent company for the period

Unit: RMB

Item

Amount for current Period

Amount for corresponding period of last

year

1. Revenue

7,837,054,703.48

7,891,905,166.94

Less: Cost of sales

5,911,395,396.07

6,103,819,546.13

Taxes and surcharges

31,067,942.67

34,830,776.94

Distribution and selling

105,839,466.28

212,608,174.26

expenses

General and administrative

211,007,950.44

229,475,875.28

expenses

Research & development

488,741,720.07

430,587,613.77

expenses

Finance expenses

-78,181,409.85

-27,541,068.69

Incl.: Interest expenses

Interest income

81,027,384.85

49,457,340.97

Add: Other income

4,420,759.78

23,759,729.17

Investment income (losses

22,832,149.38

26,029,385.01

are indicated with "-" )

Including: Share of profit of

associates and jointly- controlled

22,832,129.93

25,621,385.01

enterprises

Income from

derecognition of financial assets at

amortised cost

Gains on net exposure

hedging (losses are indicated with "-" )

Gains on fair value changes

(losses are indicated with "-" )

Credit impairment losses

-42,454,899.86

-78,574,142.96

(losses are indicated with "-" )

Asset impairment losses

1,551,724.14

(losses are indicated with "-" )

Gain on disposal of assets

3,425.85

55,802.62

(losses are indicated with "-")

27

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

2. Operating profit (losses are indicated

1,151,985,072.95

880,946,747.23

with "-" )

Add: Non-operating income

7,164,489.37

1,455,474.63

Less: Non-operating expenses

10,045,469.94

1,845,343.17

3. Total profits (total losses are

1,149,104,092.38

880,556,878.69

indicated with "-" )

Less: Income tax expenses

120,519,652.67

123,254,334.21

4. Net profits (net losses are indicated

1,028,584,439.71

757,302,544.48

with "-" )

(1) Net profit from continuing

operations (net losses are indicated

1,028,584,439.71

757,302,544.48

with "-" )

(2) Net profit from discontinued

operations (net losses are indicated

with "-" )

5. Net other comprehensive income

-37,607,679.53

-10,880,000.00

after tax

(1) Those other comprehensive

income not to be reclassified into profit

-37,607,679.53

-10,880,000.00

or loss

1. Changes arising from

re- measurement of defined benefit

plan

2. Other comprehensive

income not to be reclassified into profit

or loss using the equity method

3. Change in fair value of

-37,607,679.53

-10,880,000.00

investment in other equity instruments

4.Change in fair value of

credit risk of enterprise

5. Others

(2) Those other comprehensive

income to be reclassified into profit or

loss

1. Other comprehensive

income to be reclassified into profit or

loss using the equity method

2. Change in fair value of

other debt investments

28

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

3.

Change in fair value of

available- for-sale financial assets

4.

Amount of financial

assets to be reclassified and taken to

other comprehensive income

5.

Gains or losses on

reclassification of held-to-maturity

investments to available-for-sale

financial assets

6.

Provision for impairment

of credit in respect of other debt

investments

7.

Cashflow hedging

reserve

8.

Exchange differences on

foreign currency translation

9.

Others

6.Total comprehensive income

990,976,760.18

746,422,544.48

7. Earnings per share:

(1) Basic earnings per share

0.13

0.09

(2) Diluted earnings per share

0.13

0.09

4.1.5 Consolidated income statement from the beginning of the year to the end of the period

Unit: RMB

Item

Amount for current Period

Amount for corresponding period of last

year

1. Total revenue

126,708,257,889.91

118,182,461,250.29

Including: Revenue

126,708,257,889.91

118,182,461,250.29

Interest income

Premium income earned

Handling fees and

commission income

2. Total cost of sales

115,788,547,925.66

108,387,390,247.29

Including: Cost of sales

98,753,822,448.28

92,607,596,623.70

Interest expenses

Handling fees and

commission expenses

29

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Payments on surrenders

Claim expenses-net

Provision for insurance

liability reserve-net

Policyholder dividends

Expenses for reinsurance

Taxes and surcharges

469,604,608.84

506,427,540.54

Distribution and selling

7,944,888,246.92

7,879,958,285.22

expenses

General and administrative

4,893,364,897.77

4,609,652,169.03

expenses

Research & development

3,585,775,633.45

2,684,165,691.90

expenses

Finance expenses

141,092,090.41

99,589,936.90

Incl.: Interest expenses

923,866,580.60

924,256,520.80

Interest income

741,359,528.23

823,002,533.27

Add: Other income

140,420,761.47

108,571,869.00

Investment income (losses are

490,916,366.16

336,382,718.03

indicated with "-" )

Including: Share of profit of

associates and jointly- controlled

142,518,491.95

158,958,028.09

enterprises

Income from

derecognition of financial assets at

amortised cost

Foreign exchange gains (losses

are indicated with "-" )

Gains on net exposure hedging

(losses are indicated with "-" )

Gains on fair value changes

127,437,168.43

27,992,650.96

(losses are indicated with "-" )

Credit impairment losses

-139,139,191.29

-162,367,911.14

(losses are indicated with "-" )

Asset impairment losses (losses

-389,707,627.13

-266,412,361.68

are indicated with "-" )

Gain on disposal of assets

32,668,579.14

7,505,947.50

(losses are indicated with "-")

3. Operating profit (losses are indicated

11,182,306,021.03

9,846,743,915.67

30

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

with "-")

Add: Non-operating income

187,552,741.54

189,411,314.42

Less: Non-operating expenses

52,180,254.24

102,087,051.70

4. Total profits (total losses are indicated

11,317,678,508.33

9,934,068,178.39

with "-")

Less: Income tax expenses

1,988,493,453.31

1,886,681,408.73

5. Net profits (net losses are indicated

9,329,185,055.02

8,047,386,769.66

with "-")

(1) Breakdown by continuity of

operations

1. Net profit from continuing

9,329,185,055.02

8,047,386,769.66

operations (net losses are with "-")

2. Net profit from discontinued

operations (net losses are indicated with

"-")

(2) Breakdown by attributable

interests

1.

Net profit attributable to

7,058,241,497.72

6,001,291,382.62

owners of the parent

2.

Minority interests

2,270,943,557.30

2,046,095,387.04

6. Net other comprehensive income after

-521,033,271.70

549,913,645.06

tax

Net other comprehensive income

attributable to shareholders of the

24,532,358.19

184,711,938.33

parent after tax

(1) Those other comprehensive

income not to be reclassified into profit

-346,138,875.91

-25,331,243.37

or loss

1. Changes arising from

-691,718,277.29

74,184,061.94

re- measurement of defined benefit plan

2. Other comprehensive

income not to be reclassified into profit

-104,627.70

-1,135,343.38

or loss using the equity method

3. Change in fair value of

345,684,029.08

-98,379,961.93

investment in other equity instruments

4.Change in fair value of

credit risk of enterprise

5. Others

31

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

(2) Those other comprehensive

income to be reclassified into profit or

370,671,234.10

210,043,181.70

loss

1. Other comprehensive

income to be reclassified into profit or

-4,372,006.89

1,702,993.41

loss using the equity method

2.

Change in fair value of

other debt investments

3.

Change in fair value of

available- for-sale financial assets

4.

Amount of financial assets

to be reclassified and taken to other

comprehensive income

5.

Gains or losses on

reclassification of held-to-maturity

investments to available-for-sale

financial assets

6.

Provision for impairment

of credit in respect of other debt

investments

7.

Cashflow hedging reserve

42,048,757.57

18,474,636.46

8.

Exchange differences on

332,994,483.42

189,865,551.83

foreign currency translation

9.

Others

Net other comprehensive income

-545,565,629.89

365,201,706.73

attributable to minority interest after tax

7. Total comprehensive income

8,808,151,783.32

8,597,300,414.72

Total comprehensive income

7,082,773,855.91

6,186,003,320.95

attributable to owners of the parent

Total comprehensive income

1,725,377,927.41

2,411,297,093.77

attributable to minority interest

8. Earnings per share:

(1) Basic earnings per share

0.89

0.75

(2) Diluted earnings per share

0.89

0.75

Legal representative: Tan Xuguang

Principal in charge of accounting: Kwong Kwan Tong

Head of accounting department: Li Xia

32

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

4.1.6 Income statement of the parent company from the beginning of the year to the end of the period

Unit: RMB

Item

Amount for current Period

Amount for corresponding period of last

year

1. Revenue

32,245,617,914.49

28,697,270,964.24

Less: Cost of sales

23,510,534,234.28

20,883,118,302.29

Taxes and surcharges

184,122,428.73

220,199,143.72

Distribution and selling

793,823,881.21

1,014,123,085.41

expenses

General and administrative

756,452,928.69

905,084,497.07

expenses

Research & development

1,552,070,300.52

1,098,968,591.90

expenses

Finance expenses

-189,143,912.49

-121,672,615.15

Incl.: Interest expenses

Interest income

198,336,573.48

151,438,159.31

Add: Other income

43,907,987.73

49,905,181.93

Investment income (losses

633,717,968.81

600,920,771.09

are indicated with "-" )

Including: Share of profit of

associates and jointly- controlled

82,969,721.41

78,915,922.00

enterprises

Income from

derecognition of financial assets at

amortised cost

Gains on net exposure

hedging (losses are indicated with "-" )

Gains on fair value changes

(losses are indicated with "-" )

Credit impairment losses

-76,959,977.28

-83,582,542.57

(losses are indicated with "-" )

Asset impairment losses

-5,423,751.68

70,865.72

(losses are indicated with "-" )

Gain on disposal of assets

-3,497,073.62

1,496,613.13

(losses are indicated with "-")

2. Operating profit (losses are indicated

6,229,503,207.51

5,266,260,848.30

with "-" )

33

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Add: Non-operating income

13,152,720.65

4,681,581.29

Less: Non-operating expenses

10,278,518.52

4,436,871.14

3. Total profits (total losses are

6,232,377,409.64

5,266,505,558.45

indicated with "-" )

Less: Income tax expenses

737,221,035.08

723,050,560.26

4. Net profits (net losses are indicated

5,495,156,374.56

4,543,454,998.19

with "-" )

(1) Net profit from continuing

operations (net losses are indicated

5,495,156,374.56

4,543,454,998.19

with "-" )

(2) Net profit from discontinued

operations (net losses are indicated

with "-" )

5. Net other comprehensive income

-31,066,294.61

-63,920,000.00

after tax

(1) Those other comprehensive

income not to be reclassified into profit

-31,066,294.61

-63,920,000.00

or loss

1. Changes arising from

re- measurement of defined benefit

plan

2. Other comprehensive

income not to be reclassified into profit

or loss using the equity method

3. Change in fair value of

-31,066,294.61

-63,920,000.00

investment in other equity instruments

4.Change in fair value of

credit risk of enterprise

5. Others

(2) Those other comprehensive

income to be reclassified into profit or

loss

1. Other comprehensive

income to be reclassified into profit or

loss using the equity method

2. Change in fair value of

other debt investments

3. Change in fair value of

available- for-sale financial assets

34

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

4.

Amount of financial

assets to be reclassified and taken to

other comprehensive income

5.

Gains or losses on

reclassification of held-to-maturity

investments to available-for-sale

financial assets

6.

Provision for impairment

of credit in respect of other debt

investments

7.

Cashflow hedging

reserve

8.

Exchange differences on

foreign currency translation

9.

Others

6.Total comprehensive income

5,464,090,079.95

4,479,534,998.19

7. Earnings per share:

(1) Basic earnings per share

0.69

0.56

(2) Diluted earnings per share

0.69

0.56

4.1.7 Consolidated cash flow statement from the beginning of the year to the end of the period

Unit: RMB

Item

Amount for current Period

Amount for corresponding period of last

year

1. Cash flows from operating activities:

Cash received from sale of goods

103,365,771,888.76

98,478,414,768.41

and provision of services

Net increase in customers'

deposit and interbank deposit

Net increase in loans from central

bank

Net increase in capital borrowed

from other financial institutions

Cash received from premiums of

original insurance contract

Net cash received from

reinsurance

Net increase in policyholder

35

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

deposit and investment

Cash received from interests,

handling fees and commission

Net increase in capital borrowed

Net increase in cash received

under repurchasing

Net cash received from entrusted

sale and purchase of securities

Refund of taxes

431,071,227.98

336,021,747.26

Other cash received relating to

1,359,316,270.01

1,198,645,909.29

operating activities

Subtotal of cash inflows from operating

105,156,159,386.75

100,013,082,424.96

activities

Cash paid for purchase of goods

68,887,947,414.05

59,955,375,413.50

and receiving of services

Net increase in customers' loans

and advances

Net increase in fund deposited in

central bank and interbank

Cash paid for claims under original

insurance contract

Net increase in capital lent to

other financial institutions

Cash paid for interests, handling

fees and commission

Cash paid for dividends to

policyholders

Cash paid to and for staff

19,336,878,827.95

17,710,869,690.45

Cash paid for all types of taxes

5,405,841,153.49

5,962,371,644.12

Other cash paid relating to

7,510,780,761.45

9,893,013,782.77

operating activities

Subtotal of cash outflows from

101,141,448,156.94

93,521,630,530.84

operating activities

Net cash flows from operating activities

4,014,711,229.81

6,491,451,894.12

2. Cash flows from investing activities:

Cash received from disposal of

12,067,876,585.00

6,751,417,095.00

investments

Cash from return on investments

260,730,539.00

241,223,844.71

36

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Net cash received from disposal of

fixed assets, intangible assets and other

37,066,997.04

28,952,426.34

long-term assets

Net cash received from disposal of

108,601,950.68

subsidiaries and other business units

Other cash received relating to

6,977,595.59

investing activities

Subtotal of cash inflows from investing

12,372,651,716.63

7,130,195,316.73

activities

Cash paid for acquisition and

construction of fixed assets, intangible

3,821,141,210.56

2,468,949,254.91

assets and other long-term assets

Cash paid for investment

15,229,731,304.72

9,191,693,958.66

Net increase in pledged loans

Net cash paid for acquisition of

12,895,827.70

subsidiaries and other business units

Other cash paid relating to

9,522,144.00

23,347,049.90

investing activities

Subtotal of cash outflows from

19,060,394,659.28

11,696,886,091.17

investing activities

Net cash flows from investing activities

-6,687,742,942.65

-4,566,690,774.44

3. Cash flows from financing activities:

Cash received from capital

102,611,586.97

11,439,720.00

contribution

Including: Cash received by

subsidiaries from capital contribution

102,611,586.97

11,439,720.00

of minority shareholders

Cash received from borrowings

18,047,332,528.00

13,122,384,736.04

Other cash received relating to

59,075,529.00

78,147,926.70

financing activities

Subtotal of cash inflows from financing

18,209,019,643.97

13,211,972,382.74

activities

Cash paid for repayment of

16,354,093,409.26

11,610,709,580.69

borrowings

Cash paid for distribution of

3,777,215,336.00

3,454,644,094.53

dividends, profit or for interest

Including: Dividends and profit

1,032,472,200.75

844,579,713.84

distributed to minority shareholders by

37

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

subsidiaries

Other cash paid relating to

790,570,645.13

1,248,776,985.82

financing activities

Subtotal of cash outflows from

20,921,879,390.39

16,314,130,661.04

financing activities

Net cash flows from financing activities

-2,712,859,746.42

-3,102,158,278.30

4. Effects of changes in exchange rates

15,957,498.05

74,603,219.31

on cash and cash equivalents

5. Net increase in cash and cash

-5,369,933,961.21

-1,102,793,939.31

equivalents

Add: balances of cash and cash

equivalents as at the beginning of the

34,379,938,275.41

26,254,590,256.11

period

6. Balances of cash and cash

29,010,004,314.20

25,151,796,316.80

equivalents as at the end of the period

4.1.8 Cash flow statement of the parent company from the beginning of the year to the end of the period

Unit: RMB

Item

Amount for current Period

Amount for corresponding period of last

year

1. Cash flows from operating activities:

Cash received from sale of goods

29,482,934,239.44

30,102,537,478.93

and provision of services

Refund of taxes

Other cash received relating to

678,703,846.34

592,721,607.97

operating activities

Subtotal of cash inflows from operating

30,161,638,085.78

30,695,259,086.90

activities

Cash paid for purchase of goods

25,156,703,731.77

22,336,341,263.50

and receiving of services

Cash paid to and for staff

1,479,339,704.86

1,244,789,691.89

Cash paid for all types of taxes

2,334,820,936.94

2,633,368,276.89

Other cash paid relating to

882,242,843.59

763,183,367.03

operating activities

Subtotal of cash outflows from

29,853,107,217.16

26,977,682,599.31

operating activities

Net cash flows from operating

308,530,868.62

3,717,576,487.59

38

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

activities

2. Cash flows from investing activities:

Cash received from disposal of

876,585.00

251,615,695.00

investments

Cash from return on investments

703,710,355.37

609,243,568.84

Net cash received from disposal of

fixed assets, intangible assets and other

8,655,114.00

96,245.71

long-term assets

Net cash received from disposal of

subsidiaries and other business units

Other cash received relating to

241,783,376.18

180,422.79

investing activities

Subtotal of cash inflows from investing

955,025,430.55

861,135,932.34

activities

Cash paid for acquisition and

construction of fixed assets, intangible

1,564,837,260.58

547,979,797.33

assets and other long-term assets

Cash paid for investment

446,269,523.56

1,714,044,580.00

Net cash paid for acquisition of

subsidiaries and other business units

Other cash paid relating to

992,479,092.93

investing activities

Subtotal of cash outflows from

2,011,106,784.14

3,254,503,470.26

investing activities

Net cash flows from investing activities

-1,056,081,353.59

-2,393,367,537.92

3. Cash flows from financing activities:

Cash received from capital

contribution

Cash received from borrowings

Other cash received relating to

financing activities

Subtotal of cash inflows from financing

activities

Cash paid for repayment of

borrowings

Cash paid for distribution of

2,222,957,768.28

2,061,263,942.36

dividends, profit or for interest

Other cash paid relating to

39

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

financing activities

Subtotal of cash outflows from

2,222,957,768.28

2,061,263,942.36

financing activities

Net cash flows from financing activities

-2,222,957,768.28

-2,061,263,942.36

4. Effects of changes in exchange rates

-9,550.02

54,160.02

on cash and cash equivalents

5. Net increase in cash and cash

-2,970,517,803.27

-737,000,832.67

equivalents

Add: balances of cash and cash

equivalents as at the beginning of the

19,074,554,698.78

14,138,495,877.47

period

6. Balances of cash and cash

16,104,036,895.51

13,401,495,044.80

equivalents as at the end of the period

4.2 Descriptions of adjustment of financial statements

4.2.1 Adjustment to the opening financial statements for the year of implementation of the New Standard on Financial Instruments, New Standard on Income and New Standard on Lease in 2019

  • Applicable Not applicable Consolidated balance sheet

Unit: RMB

Item

31 December 2018

1 January 2019

Adjustment

Current assets:

Cash and cash

38,209,952,558.31

38,209,952,558.31

equivalents

Settlement provisions

Capital lent to other

financial institutions

Financial assets held for

4,115,199,600.23

4,115,199,600.23

trading

Financial assets at fair

value through profit or loss

Derivative financial

assets

Notes receivable

18,056,440,277.52

18,056,440,277.52

Accounts receivable

13,155,363,494.20

13,155,363,494.20

Receivable financing

6,936,224,398.10

6,936,224,398.10

Prepayments

1,109,227,313.17

1,109,227,313.17

40

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Insurance receivables

Reinsurance receivables

Contract reserve of

reinsurance receivables

Other receivables

1,087,148,524.03

1,087,148,524.03

Incl.: Interests

23,747,780.97

23,747,780.97

receivable

Dividends

1,608,696.50

1,608,696.50

receivable

Purchase restituted

financial assets

Inventories

20,674,287,133.47

20,674,287,133.47

Contract assets

935,892,539.90

935,892,539.90

Held-for-sale assets

5,525,306.60

5,525,306.60

Non-current assets due

2,127,858,173.40

2,127,858,173.40

within one year

Other current assets

1,692,343,618.45

1,692,343,618.45

Total current assets

108,105,462,937.38

108,105,462,937.38

Non-current assets:

Granted loans and

advances

Debt investments

Available-for-sale

financial assets

Other debt investments

Held-to-maturity

investments

Long-term receivables

6,483,298,008.60

6,483,298,008.60

Long-term equity

4,463,591,313.13

4,463,591,313.13

investments

Investments in other

1,315,633,672.96

1,315,633,672.96

equity instruments

Other non-current

192,949,412.40

192,949,412.40

financial assets

Investment property

593,459,307.58

593,459,307.58

Fixed assets

29,454,072,247.73

21,284,886,674.72

-8,169,185,573.01

Construction in progress

2,848,101,239.62

2,848,101,239.62

41

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Productive biological

assets

Oil and gas assets

Right-of-use assets

10,847,665,335.76

10,847,665,335.76

Intangible assets

23,299,455,749.37

23,299,455,749.37

Development

440,148,223.16

440,148,223.16

expenditure

Goodwill

23,037,386,296.04

23,037,386,296.04

Long-term prepaid

228,459,134.85

228,459,134.85

expenses

Deferred tax assets

4,458,451,001.33

4,628,227,385.60

169,776,384.27

Other non-current

355,896,630.03

355,896,630.03

assets

Total non-current assets

97,170,902,236.80

100,019,158,383.82

2,848,256,147.02

Total assets

205,276,365,174.18

208,124,621,321.20

2,848,256,147.02

Current liabilities:

Short-term loans

5,472,765,901.24

5,472,765,901.24

Loans from central bank

Capital borrowed from

other financial institutions

Financial liabilities held

213,435,765.47

213,435,765.47

for trading

Financial liabilities at fair

value through profit or loss

Derivative financial

liabilities

Notes payable

15,925,016,265.08

15,925,016,265.08

Accounts payable

30,869,354,934.85

30,869,354,934.85

Advance from

customers

Contract liabilities

8,722,443,043.80

8,722,443,043.80

Selling financial assets

of repurchase

Absorbing deposit and

interbank deposit

Security trading

commission

42

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Security underwriting

fees

Payroll payables

5,184,666,613.19

5,184,666,613.19

Taxes payable

2,506,794,642.37

2,506,794,642.37

Other payables

6,502,173,092.72

6,502,173,092.72

Incl.: Interests

101,293,322.06

101,293,322.06

payable

Dividends

295,006,756.48

295,006,756.48

payable

Handling fees and

commission payable

Reinsurance payables

Held-for-sale liabilities

Non-current liabilities

6,898,699,368.61

7,565,337,793.50

666,638,424.89

due within one year

Other current liabilities

6,121,799,350.16

6,121,799,350.16

Total current liabilities

88,417,148,977.49

89,083,787,402.38

666,638,424.89

Non-current liabilities:

Insurance contract

reserve

Long-term borrowings

10,908,512,233.85

10,908,512,233.85

Bonds payable

12,265,020,075.27

12,265,020,075.27

Incl: Preference

shares

Perpetual

bonds

Lease liabilities

11,889,548,623.68

11,889,548,623.68

Long-term payables

9,895,419,535.20

360,915,002.28

-9,534,504,532.92

Long-term payroll

9,580,057,732.13

9,580,057,732.13

payable

Provisions

364,979,471.20

364,979,471.20

Deferred income

3,256,007,618.70

3,256,007,618.70

Deferred tax liabilities

5,772,705,450.50

5,893,450,286.14

120,744,835.64

Other non-current

2,557,186,306.15

2,557,186,306.15

liabilities

Total non-current liabilities

54,599,888,423.00

57,075,677,349.40

2,475,788,926.40

43

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Total liabilities

143,017,037,400.49

146,159,464,751.78

3,142,427,351.29

Equity holders' interest:

Share capital

7,997,238,556.00

7,997,238,556.00

Other equity

instruments

Incl: Preference

shares

Perpetual

bonds

Capital reserves

113,699,432.76

113,699,432.76

Less: Treasury stock

499,911,217.21

499,911,217.21

Other comprehensive

-1,570,594,557.01

-1,584,006,377.44

-13,411,820.43

income

Special reserves

155,056,854.10

155,056,854.10

Surplus reserves

674,283,390.61

674,283,390.61

General risk provision

Retained earnings

32,443,962,374.77

32,324,975,192.29

-118,987,182.48

Total equity attributable to

equity holders of parent

39,313,734,834.02

39,181,335,831.11

-132,399,002.91

company

Minority interests

22,945,592,939.67

22,783,820,738.31

-161,772,201.36

Total equity holders'

62,259,327,773.69

61,965,156,569.42

-294,171,204.27

interests

Total liabilities and equity

205,276,365,174.18

208,124,621,321.20

2,848,256,147.02

holders' interests

Descriptions of adjustments made:

With effect from 1 January 2019 (the "date of first adoption"), the Group has adopted the Accounting Standards for Business Enterprises No. 21 - Lease (the "New Standard on Lease"; the standard on lease before amendment is referred as the "Original Standard on Lease") amended by MOF in 2018.

For the contracts already existed before the date of first adoption, the Group chose not to re-assess whether they were of lease or included lease on the date of first adoption.

For the contracts signed or changed after the date of first adoption, the Group has assessed whether the contracts were of lease or included lease according to the definitions stated in the New Standard on Lease. The definitions stated in the New Standard on Lease do not have major impacts on the scope of the Group's contracts fulfilling the definitions of lease.

The Group as lessee

The Group adjusted the beginning amount of the retained earnings and other relevant items on financial statements on the first date of adoption when the New Standard on Lease was first adopted based on the cumulative impact of first adoption of the New Standard on Lease without adjusting the information for the comparable period.

For the operating leases before the first date of adoption, the Group adopted one or more than one simplified treatments as follows

44

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

based on each lease option:

  • Leases to be completed within 12 months of the first date of adoption shall be treated as short-term leases;
  • When measuring the lease liabilities, a single discount rate is adopted for leases with similar characteristics;
  • The measurement of right-of-use assets does not include initial direct cost;
  • For the leases with extension option or termination option, the Group determines the lease term based on the exercise of options in practice prior to the first date of adoption and other latest developments;
  • The Group assesses whether the contracts with leases are onerous before the first date of adoption according to "Accounting Standard for Business Enterprises No.13 - Contingencies" and adjusts the right-of-use assets based on the provision for loss made in the
    balance sheet before the first date of adoption as an alternative to performing an impairment review on the right-of-use assets;
  • For the change of the lease before the first date of adoption, accounting treatments shall be in accordance with the final arrangements of the change of the lease.
    For the operating leases before the first date of adoption, the Group assumed that the New Standard on Lease is adopted to measure right-of-use assets once the lease term commenced, with the carrying amount discounted using the incremental borrowing rate at the first date of adoption.
    For the finance leases before the first date of adoption, the Group measured the right-of-use assets and lease liabilities at the original carrying amounts of the assets under finance lease and the finance lease payable respectively on the first date of adoption.
    On the first date of adoption, the Group made the adjustments as follows in connection with the adoption of the New Standard on Lease:
    The Group recognized lease liabilities of RMB17,418,755,002.55 and right-of-use assets of RMB10,847,665,335.76 on 1 January 2019. For the operating leases before the first date of adoption, the Group measures the lease liabilities according to the present value discounted at the incremental borrowing rate on the first date of adoption, where the range of discount rate of the incremental borrowing is between 0%-15%. Based on each lease option, the Group measured right-of-use assets according to the assumption that the carrying amount under this standard was adopted once the lease term commenced.
    The reconciliation information of the lease liabilities recognized by the Group on 1 January 2019 and the major operating lease commitments disclosed in the 2018 annual financial statements is as follows:

Unit: RMB

Item

1 January 2019

1. Operating lease commitments as at 31 December 2018

3,595,922,598.51

Lease liabilities according to the present value discounted at the incremental

3,120,052,462.73

borrowing rate on the first date of adoption

Less: Recognized exemption - short-term lease

98,369,947.08

Lease liabilities recognized for adopting the New Standard on Lease and relevant

3,021,682,515.65

to the original operating leases

Add: Finance lease payable as at 31 December 2018

14,397,072,486.90

2. Lease liabilities as at 1 January 2019

17,418,755,002.55

Presented as:

Non-current liabilities due within one year

5,529,206,378.87

Lease liabilities

11,889,548,623.68

45

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

The composition of the carrying amount of the right-of-use assets as at 1 January 2019 is as follows:

Unit: RMB

Item

1 January 2019

Right-of-use assets

Right-of-use assets in respect of the operating leases recognized before the first

2,678,479,762.75

date of adoption

Assets under financial lease recognized under the Original Standard on Lease

8,169,185,573.01

Total:

10,847,665,335.76

The Group as lessor

The Group did not make any transitional adjustment for leases in which the Group is a lessor and such leases were accounted for according to the New Standard on Lease since the first date of adoption.

On the first date of adoption, for the renewed leases for the existing leased properties which the Group has signed but whose lease period has not commenced, they will be deemed as a change with respect to the existing lease contracts on the first date of adoption. Such change had no impact on the balance sheet as of 1 January 2019. However, since 1 January 2019, the lease receivables after the change in the lease terms after the change will be recognized as rental income on a straight-line basis.

Since the first date of adoption, the Group allocates the consideration in respect of the contract in accordance with the principles of transaction price allocation described in Accounting Standard for Business Enterprises No. 14 - Revenue. The change had no material impact on the financial statements of the period.

Sales and leaseback transactions

For the sales and leaseback transactions which existed before the first date of adoption, the Group did not reassess, on the first date of adoption, whether the transfer of assets complies with the requirements on accounting treatment for sales pursuant to the Accounting Standard for Business Enterprises No. 14 - Revenue.

For the transactions after the first date of adoption, the Group, as a seller and lessee, applied the requirements under Accounting Standard for Business Enterprises No. 14 - Revenue to assess and determine whether asset transfer in a sales and leaseback transaction constitute sales. If the transfer of assets in the sales and leaseback transaction does not constitute a sale, the Group would determine the proceeds as financial liabilities.

Balance sheet of the parent company

Unit: RMB

Item

31 December 2018

1 January 2019

Adjustment

Current assets:

Cash and cash

equivalents

19,192,409,975.7819,192,409,975.78

Financial assets held for trading

Financial assets at fair value through profit or loss

46

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Derivative financial

assets

Notes receivable

21,026,407,121.15

21,026,407,121.15

Accounts receivable

1,069,759,568.00

1,069,759,568.00

Receivable financing

Prepayments

385,395,385.93

385,395,385.93

Other receivables

501,826,716.43

501,826,716.43

Incl.: Interests

10,662,718.08

10,662,718.08

receivable

Dividends

292,560,465.75

292,560,465.75

receivable

Inventories

1,971,178,990.99

1,971,178,990.99

Contract assets

Held-for-sale assets

Non-current assets due

within one year

Other current assets

164,194,933.94

164,194,933.94

Total current assets

44,311,172,692.22

44,311,172,692.22

Non-current assets:

Debt investments

Available-for-sale

financial assets

Other debt investments

Held-to-maturity

investments

Long-term receivables

Long-term equity

14,531,123,322.77

14,531,123,322.77

investments

Investments in other

170,082,200.00

170,082,200.00

equity instruments

Other non-current

financial assets

Investment property

1,372,826,553.46

1,372,826,553.46

Fixed assets

2,561,908,781.20

2,561,908,781.20

Construction in progress

922,996,632.68

922,996,632.68

Productive biological

47

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

assets

Oil and gas assets

Right-of-use assets

Intangible assets

447,349,640.19

447,349,640.19

Development

expenditure

Goodwill

341,073,643.76

341,073,643.76

Long-term prepaid

expenses

Deferred tax assets

949,075,808.16

949,075,808.16

Other non-current

2,266,184,774.12

2,266,184,774.12

assets

Total non-current assets

23,562,621,356.34

23,562,621,356.34

Total assets

67,873,794,048.56

67,873,794,048.56

48

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Current liabilities:

Short-term loans

Financial liabilities held

for trading

Financial liabilities at

fair value through profit or

loss

Derivative financial

liabilities

Notes payable

11,756,416,668.11

11,756,416,668.11

Accounts payable

9,543,570,906.39

9,543,570,906.39

Advance from

customers

Contract liabilities

1,481,303,661.91

1,481,303,661.91

Payroll payables

916,685,488.49

916,685,488.49

Taxes payable

569,997,419.03

569,997,419.03

Other payables

1,783,055,862.95

1,783,055,862.95

Incl.: Interests

payable

Dividends

payable

Held-for-sale liabilities

Non-current liabilities

due within one year

Other current liabilities

1,681,702,830.61

1,681,702,830.61

Total current liabilities

27,732,732,837.49

27,732,732,837.49

Non-current liabilities:

Long-term borrowings

Bonds payable

Incl: Preference

shares

Perpetual

bonds

Lease liabilities

Long-term payables

5,515,822.60

5,515,822.60

Long-term payroll

13,444,746.89

13,444,746.89

payable

49

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

Provisions

Deferred income

803,454,411.80

803,454,411.80

Deferred tax liabilities

Other non-current

liabilities

Total non-current liabilities

822,414,981.29

822,414,981.29

Total liabilities

28,555,147,818.78

28,555,147,818.78

Equity holders' interest:

Share capital

7,997,238,556.00

7,997,238,556.00

Other equity

instruments

Incl: Preference

shares

Perpetual

bonds

Capital reserves

1,084,612,950.62

1,084,612,950.62

Less: Treasury stock

499,911,217.21

499,911,217.21

Other comprehensive

-47,258,130.00

-47,258,130.00

income

Special reserves

74,867,864.57

74,867,864.57

Surplus reserves

2,811,115,722.19

2,811,115,722.19

Retained earnings

27,897,980,483.61

27,897,980,483.61

Total equity holders'

39,318,646,229.78

39,318,646,229.78

interests

Total liabilities and equity

67,873,794,048.56

67,873,794,048.56

holders' interests

The New Standard on Lease has no impact on the financial statements of the parent company as at 1 January 2019.

4.2.2 Descriptions of retrospective adjustment to comparative data in previous period following the implementation of the New Standard on Financial Instruments or New Standard on Lease in 2019

Applicable Not applicable

50

WEICHAI POWER CO., LTD. THIRD QUARTERLY REPORT FOR 2019 (Full Report)

4.3 Auditors' report

Whether the third quarterly report is audited or not

  • Yes No

The third quarterly report of the Company is not audited.

WEICHAI POWER CO., LTD.

Tan Xuguang, Chairman

30 October 2019

51

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Weichai Power Company Limited published this content on 30 October 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 October 2019 13:11:04 UTC