Weichai Power Co., Ltd. ("Weichai Power" or the "Company"; 2338.HK, 000338.SZ) is pleased to announce that the company has been audited in accordance with China Accounting Standards as of December 31, 2022 (the "Reporting Period") annual results.

Operating performance demonstrates resilience, high proportion of dividends rewards shareholders

In 2022, in the face of the downward pressure on the macro economy and the industry, the company actively responded, operated steadily, and made continuous breakthroughs in new technologies, new products, and new businesses. The profit was about 4.91 billion yuan. At the same time, the company adheres to a high-ratio and stable dividend policy, continues to create value and returns for shareholders, and shares development dividends. In 2022, the cash dividend ratio will reach 45%, the highest in the past five years. The cumulative cash dividend amount since listing has exceeded 24 billion yuan.

Powertrain has significant advantages, and R&D helps value enhancement

During the reporting period, the company sold 573,000 engines of various types. The market share of heavy-duty truck engines rose to 32.2%, among which, the market share of engines with 400-500 horsepower was as high as 49%, and the market share of trunk line logistics and transportation market with more than 500 horsepower rose to 18%; the market share of construction machinery engines rose to 34%. Maintain the leading position in the industry. The scientific and technological research and development capabilities have been comprehensively improved, and innovative achievements have led the development of the industry. It successively released the world's first commercial diesel engine with body thermal efficiency breaking through 51% and 52%, continuously setting new world records and continuing to lead the development of the global internal combustion engine industry. The WP14H, WP15H, WP15NG and the new T series high-end engine products were released in a big way, with various technical and performance indicators leading the way, leading the transformation and upgrading of the industry.

High-end breakthroughs in heavy trucks, the best export performance in history

During the reporting period, the company sold a total of 80,000 heavy-duty trucks, and made a breakthrough in the high-end market, leading China into a new era of energy-saving high-end heavy-duty trucks with strong horsepower. In 2022, Shaanxi Heavy Duty Truck's high-horsepower series of high-end products will be successfully launched, and the sales of X6000 series products will exceed 2,000 vehicles. At the same time, it actively integrated into the "Belt and Road" to build and share, and seized opportunities in the international market. Sales in overseas markets increased by 79% year-on-year to 34,000 vehicles, a record high.

The production and sales of large-bore engines are booming, and high-end hydraulic pressure continues to develop

The large-bore high-speed engine continues to make efforts to segment the market and achieve high-speed growth. In 2022, sales will increase by 70% year-on-year to more than 8,800 units, and revenue will increase by about 109% year-on-year to 2.95 billion yuan, of which overseas market revenue will account for 70%. The differentiated competitive advantage of the hydraulic powertrain is prominent. The high-end hydraulic powertrain for construction machinery independently developed by the company has been fully introduced to the market. The first hydrostatic powertrain has been successfully installed in batches, leading a new round of upgrading in the industry. During the reporting period, the company's high-end hydraulics achieved a domestic revenue of 650 million yuan, with a compound growth rate of 27% in the past five years.

New energy is ready to go, commercialization accelerates breakthrough

The company controls the world's leading high-quality resources and opens up multiple energy transformation paths. During the reporting period, it focused on tackling key problems in pure electric powertrain technology, and completed the product development of electric drive axle assembly, central drive assembly and core components, with industry-leading product performance. Accelerate the technical research and commercialization of hydrogen energy routes, develop a full range of fuel cell product platforms from 15-260kW, promote the launch of the country's first port hydrogen fuel cell heavy truck demonstration operation project in Qingdao Port, and put into operation the country's first expressway hydrogen refueling station in Zibo The mileage of the 49-ton fuel cell heavy truck equipped with Weichai Power products exceeds 240,000 kilometers; buses equipped with Weichai hydrogen fuel cell engines have been launched in batches in Jinan, Weifang, Wuxi and other cities, with a cumulative mileage of more than 25 million kilometers.

Five firsts in agricultural equipment, leading the intelligent upgrade of the industry

The company gives full play to its synergistic advantages to promote the transformation and upgrading of agricultural equipment to large-scale, high-end and intelligent. During the reporting period, Weichai Lovol achieved an operating income of 17.16 billion yuan, and the total sales volume of agricultural equipment products for the year increased significantly, ranking first in the domestic industry in terms of scale. The main products take the lead across the board, and the market share of tractors with 200 horsepower and above, wheat machines, and corn machines ranks first in the country. Leading the development of a number of major national scientific and technological research projects, leading the industry to the high end. The first commercial 240 horsepower CVT smart tractor in China has been commercialized in large quantities, successfully creating an overall solution for smart agriculture, and technology helps guard the granary.

Smart logistics is gaining momentum, and profits have improved significantly from the previous quarter

Overcoming the unfavorable macroeconomic environment, the company's overseas holding subsidiary KION Group AG ("Kion") achieved a high order volume, and its revenue increased by 8.2% year-on-year to 11.14 billion euros. Affected by rising material, energy and logistics costs and supply chain disruptions, net profit declined. During the reporting period, KION implemented a package of measures to improve its business resilience and profitability. In the fourth quarter of 2022, its profitability improved significantly from the previous quarter, and its ability to resist crises continued to increase.

Looking forward to the future, the company will continue to consolidate its leading position in the industry, promote products to high-end, ensure the expansion of core market advantages, and continue to increase the volume of strategic markets. Expand the global leading advantages of power systems, rapidly improve the competitiveness of new energy, promote the competitiveness of heavy trucks to the world's leading position, help agricultural equipment lead the transformation and upgrading of the industry, take advantage of high-end hydraulic powertrains to actively expand the high-end market, and accelerate the development of intelligent logistics China's first echelon, with high-end technology and diversified formats to help the company achieve steady and positive development.Editor/Ma Xue