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HONG KONG, September 12, 2001 - Ek Chor China Motorcycle Co.
Ltd. ("Ek Chor China" or the "Company"; NYSE: EKC), today announced
its results for the year ended June 30, 2001.
Highlights
- Net income - RMB20.2 million (US$2.4 million) (2000: RMB21.1
million).
- Earnings per share - RMB1.15 (US$0.14) (2000: RMB1.20).
- Share of net income of joint ventures - RMB28.6 million (US$3.5
million) (2000: RMB27.2 million).
Overview
The motorcycle business of Ek Chor China continued to face difficult
business conditions in the first half of 2001. Because of intense
price competition, Luoyang Northern Ek Chor Motorcycle Company
Limited experienced a decrease in sales and gross profits that
resulted in a loss for the period. The operating results of our
parts manufacturing ventures were satisfactory taking into consideration
the competitive market environment. Shanghai-Ek Chor General Machinery
Co., Ltd., Zhan Jiang Deni Carburetor Co. Ltd. and Shanghai Ek
Chor Nissei Co., Ltd. performed in line with the Company's expectations.
We expect the difficult trading conditions in the People's Republic
of China (the "PRC") to continue through the second half of 2001.
We hope that our continuous efforts in improving operating efficiencies,
exploring new markets and cost control will improve our performance
during these difficult times.
Brief review of six months ended June 30,
2001 results of the Company's existing ventures
- Luoyang Northern Ek Chor Motorcycle Company Limited ("Luoyang
Motorcycle")
Sales for the first six months of 2001 were RMB348.2 million
(US$42.1 million), a decrease of 21.2% over the same period last
year. Net loss for the period was RMB7.7 million (US$0.9 million)
(2000: RMB1.9 million).
Luoyang Motorcycle's total unit sales were 94,084 units for the
period, a decrease of 12.5% over the same period last year. Unit
sales of the 90cc model and 100cc model were 45,090 units and
28,213 units respectively, a decrease of 34.6% and an increase
of 0.7% respectively, over the same period last year. Intense
price competition and shrinkage in the 90cc market in the PRC
were the major reasons for the decline in sales.
The Company owns an effective 55% interest in Luoyang Motorcycle.
- Shanghai-Ek Chor General Machinery Co., Ltd. ("Shanghai
Machinery")
Shanghai Machinery continued to generate satisfactory sales growth
in its automotive air conditioner compressors in the first six
months of 2001. Total sales for the period were RMB525.8 million
(US$63.5 million), an increase of 18.5% over the same period last
year. Net income was RMB53.4 million (US$6.4 million), an increase
of 8.1% over the same period last year (2000: RMB49.4 million).
Shanghai Machinery sold 365,833 automotive air conditioner compressors
and 220,839 receiver-driers during the first six months of 2001,
increases of 32.2% and 18.5% respectively, over the same period
last year.
The Company owns an effective 50% interest in Shanghai Machinery.
- Zhan Jiang Deni Carburetor Co., Ltd. ("Deni Carburetor")
Sales for the first six months of 2001 were RMB100.1 million
(US$12.1 million), compared to RMB104.7 million in the same period
last year, a decrease of 4.4%. Deni Carburetor's net income during
the first half of 2001 increased 31.9% to RMB14.9 million (US$1.8
million), compared to RMB11.3 million during the same period last
year.
Deni Carburetor sold 13,201 sets of automotive carburetors and
1,001,097 sets of motorcycle carburetors, a decrease of 42.6%
and an increase of 12.4% respectively, over the same period in
2000. A reduction in the production of automobiles using carburetors
by a major customer is the primary reason for the decline in carburetor
sales.
The Company owns an effective 28% interest in Deni Carburetor.
- ECI Metro Investment Co., Ltd. ("ECI Metro")
ECI Metro is a dealer of a full range of Caterpillar products
in several provinces in the PRC. Sales for the first six months
of 2001 were RMB148.4 million (US$17.9 million), compared to RMB127.7
million in the same period last year, an increase of 16.2%. ECI
Metro generated a net income of RMB0.05 million during the first
half of 2001, a decrease of 98.6% as compared to RMB3.5 million
during the same period last year. A reduction in subsidies from
Caterpillar and lower gross margins were the major reasons for
the decrease in net income for the period.
The Company owns an effective 50% interest in ECI Metro.
- Shanghai Ek Chor Nissei Co., Ltd. ("Shanghai Nissei")
Shanghai Nissei manufactures speedometers, tachometers and other
component parts for motorcycles. Sales for the first six months
of 2001 were RMB48.6 million (US$5.9 million), compared to RMB22.8
million in the same period last year, an increase of 113.2%. Net
income during the first half of 2001 was RMB6.9 million (US$0.8
million), compared to a loss of RMB2.3 million for the same period
last year.
The Company owns an effective 34% interest in Shanghai Nissei.
Dividends
The Board of Directors has decided not to declare any dividend
in respect of the six months ended June 30, 2001 (2000: nil).
Change of Directors
Mr. Thomas Chia has resigned as Director and Chief Operating
Officer of the Company on September 12, 2001. The Board wishes
to express its sincere gratitude to Mr Thomas Chia for his valuable
contribution to the Company. The Board is also pleased to announce
that Mr. Prasertsak Ongwattanakul be appointed as Director and
Chief Operating Officer of the Company with effect from the same
date.
* * * * * * * * *
Exchange Rate Note : Certain amounts herein have been
translated from Renminbi ("RMB"), the legal tender currency in
the PRC, into U.S. dollars ("US$") solely for the convenience
of the reader, using the unified exchange rate as quoted by the
People's Bank of China of RMB8.28 = US$1.00 on June 30, 2001.
No representation is made that RMB could have been, or could be,
converted into US$ at that rate or any other rate, or at all.
* * * * * * * * *
Ek Chor China is a Bermuda incorporated holding company which
owns interests in and actively manages sino-foreign joint ventures
in the PRC. These ventures are engaged in the design, manufacture
and sale of motorcycles and motorcycle parts and components, automotive
air conditioner compressors and carburetors, and certain other
automotive instrumentation parts and components. The Company has
considered and will consider from time to time divestment of its
interests when presented with attractive opportunities. The Company's
common shares are listed on the New York Stock Exchange under
the symbol EKC.
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Key financial highlights for the six months ended June 30,
2000 and 2001: (All figures in RMB million, except per share
figures which are in RMB)
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2000
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2001
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The Company
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Share of net income of joint ventures
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27.2
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28.6
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Income before income taxes and minority
interests
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21.1
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20.2
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Net income
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21.1
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20.2
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Earnings per share
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1.20
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1.15
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Luoyang Motorcycle
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Net sales
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441.7
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348.2
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Operating loss
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(3.5)
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(20.0)
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Loss before income taxes and minority
interests
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(1.7)
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(7.2)
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Net loss
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(1.9)
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(7.7)
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Shanghai Machinery
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Net sales
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443.7
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525.8
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Operating income
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76.0
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82.6
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Income before income taxes
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68.1
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73.8
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Net income
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49.4
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53.4
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Deni Carburetor
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Net sales
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104.7
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100.1
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Operating income
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16.7
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19.5
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Income before income taxes
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12.9
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17.0
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Net income
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11.3
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14.9
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ECI Metro
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Net sales
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127.7
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148.4
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Operating income
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5.6
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0.4
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Income before income taxes
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3.9
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0.6
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Net income
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3.5
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0.1
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Unit sales
for the six months ended
June
30, 2000 and 2001
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2000
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2001
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% Change
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Luoyang Motorcycle
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- 50cc model
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923
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7,398
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701.5
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- 90cc model
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68,960
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45,090
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(34.6)
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- 100cc model
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28,008
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28,213
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0.7
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- 110cc model
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0
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1,536
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N/A
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- 125cc model
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9,532
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11,645
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22.2
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- 150cc model
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71
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202
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184.5
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Total
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107,494
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94,084
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(12.5)
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======
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======
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Shanghai Machinery
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-Air conditioner compressors
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276,766
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365,833
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32.2
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-Receiver-Driers
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186,328
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220,839
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18.5
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Deni Carburetor
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-Motorcycle carburetors
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890,716
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1,001,097
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12.4
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-Automotive carburetors
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23,004
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13,201
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(42.6)
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- End -
Distributed by Ek Chor China Motorcycle Co. Ltd.
For further information, please contact:
Ek Chor China Motorcycle Co. Ltd.
Robert
Ping-Hsien Ho
Tel: (852) 2520 1601
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