Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | May 23, 2022 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2022 | |
Document Transition Report | false | |
Entity File Number | 000-33123 | |
Entity Registrant Name | CHINA AUTOMOTIVE SYSTEMS INC | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 33-0885775 | |
Entity Address, Address Line One | No. 1 Henglong Road, Yu Qiao Development Zone | |
Entity Address, Address Line Two | Shashi District | |
Entity Address, Address Line Three | Jing Zhou City | |
Entity Address, City or Town | Hubei Province | |
Entity Address, Country | CN | |
City Area Code | 86 | |
Local Phone Number | 716- 412- 7901 | |
Title of 12(b) Security | Common Stock, $0.0001 par value | |
Trading Symbol | CAAS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 30,851,776 | |
Entity Central Index Key | 0001157762 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Unaudited Consolidate
Condensed Unaudited Consolidated Statements of Operations and Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Net product sales ($11,004 and $16,575 sold to related parties for the three months ended March 31, 2022 and 2021) | $ 136,396 | $ 130,341 |
Cost of products sold ($7,540 and $8,214 purchased from related parties for the three months ended March 31, 2022 and 2021) | 121,662 | 110,593 |
Gross profit | 14,734 | 19,748 |
Gain on other sales | 931 | 1,316 |
Less: Operating expenses | ||
Selling expenses | 4,312 | 5,609 |
General and administrative expenses | 4,754 | 4,615 |
Research and development expenses | 8,137 | 6,680 |
Total operating expenses | 17,203 | 16,904 |
(Loss)/income from operations | (1,538) | 4,160 |
Other income, net | 3,519 | 1,723 |
Interest expense | (402) | (343) |
Financial income/(expense), net | 2,015 | (239) |
Income before income tax expenses and equity in earnings of affiliated companies | 3,594 | 5,301 |
Less: Income taxes | 958 | 641 |
Add: Equity in loss of affiliated companies | (2,487) | (1,429) |
Net income | 149 | 3,231 |
Less: Net income attributable to non-controlling interests | 200 | 18 |
Net (loss)/income attributable to parent company's common shareholders | (8) | (7) |
Net (loss)/income attributable to parent company's common shareholders | (59) | 3,206 |
Comprehensive income: | ||
Net income | 149 | 3,231 |
Other comprehensive income: | ||
Foreign currency translation income/(loss), net of tax | 1,437 | (2,271) |
Comprehensive income | 1,586 | 960 |
Comprehensive income/(loss) attributable to non-controlling interests | 289 | (118) |
Net (loss)/income attributable to parent company's common shareholders | (8) | (7) |
Comprehensive income attributable to parent company | $ 1,289 | $ 1,071 |
Net (loss)/income attributable to parent company's common shareholders per share - | ||
Basic - (in dollars per share) | $ 0 | $ 0.10 |
Diluted - (in dollars per share) | $ 0 | $ 0.10 |
Weighted average number of common shares outstanding - | ||
Basic (in shares) | 30,851,776 | 30,851,776 |
Diluted (in shares) | 30,851,776 | 30,857,736 |
General and administrative expense | ||
Share-based compensation included in operating expense above is as follows: | ||
Share-based compensation | $ 0 | $ 88 |
Condensed Unaudited Consolida_2
Condensed Unaudited Consolidated Statements of Operations and Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Condensed Unaudited Consolidated Statements of Operations and Comprehensive Income | ||
Revenue from Related Parties | $ 11,004 | $ 16,575 |
Related Party Costs | $ 7,540 | $ 8,214 |
Condensed Unaudited Consolida_3
Condensed Unaudited Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 79,402 | $ 131,695 |
Pledged cash | 30,047 | 27,804 |
Accounts and notes receivable, net - unrelated parties | 211,035 | 195,729 |
Accounts and notes receivable, net - related parties | 11,362 | 14,607 |
Inventories | 114,483 | 116,493 |
Other current assets | 59,252 | 15,052 |
Total current assets | 505,581 | 501,380 |
Non-current assets: | ||
Property, plant and equipment, net | 123,436 | 127,721 |
Land use rights, net | 10,705 | 10,732 |
Long-term investments | 60,660 | 36,966 |
Other non-current assets | 26,265 | 39,963 |
Total assets | 726,647 | 716,762 |
Current liabilities: | ||
Short-term loans | 48,185 | 47,592 |
Accounts and notes payable-unrelated parties | 215,892 | 214,590 |
Accounts and notes payable-related parties | 11,784 | 13,464 |
Accrued expenses and other payables | 58,340 | 50,332 |
Other current liabilities | 25,819 | 25,838 |
Total current liabilities | 360,020 | 351,816 |
Long-term liabilities: | ||
Long-term tax payable | 21,075 | 21,075 |
Other non-current liabilities | 6,525 | 6,430 |
Total liabilities | 387,620 | 379,321 |
Commitments and Contingencies (See Note 22) | ||
Mezzanine equity: | ||
Redeemable non-controlling interests | 561 | 553 |
Stockholders' equity: | ||
Common stock, $0.0001 par value - Authorized - 80,000,000 shares; Issued - 32,338,302 and 32,338,302 shares as of March 31, 2022 and December 31, 2021, respectively | 3 | 3 |
Additional paid-in capital | 63,731 | 63,731 |
Retained earnings- | ||
Appropriated | 11,481 | 11,481 |
Unappropriated | 226,304 | 226,363 |
Accumulated other comprehensive income | 26,065 | 24,717 |
Treasury stock - 1,486,526 and 1,486,526 shares as of March 31, 2022 and December 31, 2021, respectively | (5,261) | (5,261) |
Total parent company stockholders' equity | 322,323 | 321,034 |
Non-controlling interests | 16,143 | 15,854 |
Total stockholders' equity | 338,466 | 336,888 |
Total liabilities, mezzanine equity and stockholders' equity | $ 726,647 | $ 716,762 |
Condensed Unaudited Consolida_4
Condensed Unaudited Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2022 | Dec. 31, 2021 |
Condensed Unaudited Consolidated Balance Sheets | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 80,000,000 | 80,000,000 |
Common stock, shares issued | 32,338,302 | 32,338,302 |
Treasury stock, shares | 1,486,526 | 1,486,526 |
Condensed Unaudited Consolida_5
Condensed Unaudited Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash flows from operating activities: | ||
Net income | $ 149 | $ 3,231 |
Adjustments to reconcile net income from operations to net cash provided by /(used in) operating activities: | ||
Share-based compensation | 0 | 88 |
Depreciation and amortization | 6,207 | 6,544 |
Provision/(reversal) of credit losses | 100 | (177) |
Deferred income taxes | 286 | (254) |
Equity in loss of affiliated companies | 2,487 | 1,429 |
Loss on fixed assets disposals | 37 | 9 |
(Increase)/decrease in: | ||
Accounts and notes receivable | (11,184) | (3,972) |
Inventories | 2,532 | (1,934) |
Other current assets | (1,281) | (1,371) |
Increase/(decrease) in: | ||
Accounts and notes payable | (1,407) | 1,595 |
Accrued expenses and other payables | (2,041) | (4,135) |
Other current liabilities | (135) | (1,811) |
Net cash used in operating activities | (4,250) | (758) |
Cash flows from investing activities: | ||
Decrease/(increase) in demand loans included in other non-current assets | 242 | (33) |
Repayment of loan from a related party | 0 | 154 |
Cash received from property, plant and equipment sales | 95 | 51 |
Payments to acquire property, plant and equipment (including $794 and $137 paid to related parties for the three months ended March 31, 2022 and 2021, respectively) | (1,024) | (3,267) |
Payments to acquire intangible assets | (40) | (112) |
Investment under the equity method | (4,724) | |
Purchase of short-term investments | (44,693) | (14,661) |
Proceeds from maturities of short-term investments | 1,801 | 9,873 |
Cash received from long-term investment | 2,704 | 2,237 |
Net cash used in investing activities | (45,639) | (5,758) |
Cash flows from financing activities: | ||
Proceeds from bank loans | 16,088 | 12,569 |
Repayments of bank loans | (15,701) | (10,086) |
Repayments of the borrowing for sale and leaseback transaction | (1,130) | (1,107) |
Net cash (used in)/provided by financing activities | (743) | 1,376 |
Effects of exchange rate on cash, cash equivalents and pledged cash | 583 | (884) |
Net decrease in cash, cash equivalents and pledged cash | (50,049) | (6,024) |
Cash, cash equivalents and pledged cash at beginning of the period | 159,498 | 128,061 |
Cash, cash equivalents and pledged cash at end of the period | $ 109,449 | $ 122,037 |
Condensed Unaudited Consolida_6
Condensed Unaudited Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Payments to Acquire Property, Plant, and Equipment | $ 1,024 | $ 3,267 |
Related Party [Member] | ||
Payments to Acquire Property, Plant, and Equipment | $ 794 | $ 137 |
Organization and business
Organization and business | 3 Months Ended |
Mar. 31, 2022 | |
Organization and business | |
Organization and business | 1. Organization and business China Automotive Systems, Inc., “China Automotive,” was incorporated in the State of Delaware on June 29, 1999 under the name Visions-In-Glass, Inc. China Automotive, including, when the context so requires, its subsidiaries described below, is referred to herein as the “Company.” The Company is primarily engaged in the manufacture and sale of automotive systems and components, as described below. Great Genesis Holdings Limited, a company incorporated in Hong Kong on January 3, 2003 under the Companies Ordinance in Hong Kong as a limited liability company, “Genesis,” is a wholly-owned subsidiary of the Company. Henglong USA Corporation, “HLUSA,” incorporated on January 8, 2007 in Troy, Michigan, is a wholly-owned subsidiary of the Company, and mainly engages in marketing of automotive parts in North America, and provides after-sales service and research and development support accordingly. The Company owns the following aggregate net interests in the following subsidiaries organized in the People’s Republic of China, the “PRC,” and Brazil as of March 31, 2022 and December 31, 2021. Percentage Interest March 31, December 31, Name of Entity 2022 2021 Shashi Jiulong Power Steering Gears Co., Ltd., “Jiulong” 1 100.00 % 100.00 % Jingzhou Henglong Automotive Parts Co., Ltd., “Henglong” 2 100.00 % 100.00 % Shenyang Jinbei Henglong Automotive Steering System Co., Ltd., “Shenyang” 3 70.00 % 70.00 % Wuhan Jielong Electric Power Steering Co., Ltd., “Jielong” 4 85.00 % 85.00 % Wuhu Henglong Automotive Steering System Co., Ltd., “Wuhu” 5 100.00 % 100.00 % Hubei Henglong Automotive System Group Co., Ltd., “Hubei Henglong” 6 100.00 % 100.00 % Jingzhou Henglong Automotive Technology (Testing) Center, “Testing Center” 7 100.00 % 100.00 % Chongqing Henglong Hongyan Automotive System Co., Ltd., “Chongqing Henglong” 8 70.00 % 70.00 % CAAS Brazil’s Imports and Trade In Automotive Parts Ltd., “Brazil Henglong” 9 95.84 % 95.84 % Wuhan Chuguanjie Automotive Science and Technology Ltd., “Wuhan Chuguanjie” 10 85.00 % 85.00 % Hubei Henglong Group Shanghai Automotive Electronics Research and Development Ltd., “Shanghai Henglong” 11 100.00 % 100.00 % Jingzhou Qingyan Intelligent Automotive Technology Research Institute Co., Ltd., “Jingzhou Qingyan” 12 60.00 % 60.00 % Hubei Henglong & KYB Automobile Electric Steering System Co., Ltd., “Henglong KYB” 13 66.60 % 66.60 % Hyoseong (Wuhan) Motion Mechatronics System Co., Ltd., “Wuhan Hyoseong” 14 51.00 % 51.00 % Wuhu Hongrun New Material Co., Ltd., “Wuhu Hongrun” 15 62.00 % 62.00 % Changchun Hualong Automotive Technology Co., Ltd., “Changchun Hualong” 16 100.00 % 100.00 % 1. Jiulong was established in 1993 and mainly engages in the production of integral power steering gears for heavy-duty vehicles. 2. Henglong was established in 1997 and mainly engages in the production of rack and pinion power steering gears for cars and light duty vehicles. 3. Shenyang was established in 2002 and focuses on power steering parts for light duty vehicles. 4. Jielong was established in 2006 and mainly engages in the production and sales of automotive steering columns. 5. Wuhu was established in 2006 and mainly engages in the production and sales of automobile steering systems. In April 2021, the Company obtained an additional 22.67% equity interest in Wuhu for total consideration of RMB 6.9 million, equivalent to approximately $ 1.1 million , from the other shareholder. The Company retained its controlling interest in Wuhu and the acquisition of the additional 22.67% equity interest in Wuhu was accounted for as an equity transaction. 6. On March 7, 2007, Genesis established Hubei Henglong, formerly known as Jingzhou Hengsheng Automotive System Co., Ltd., its wholly-owned subsidiary, to engage in the production and sales of automotive steering systems. On July 8, 2012, Hubei Henglong changed its name to Hubei Henglong Automotive System Group Co., Ltd. 7. In December 2009, Henglong, a subsidiary of Genesis, formed Testing Center, which mainly engages in the research and development of new products. 8. On February 21, 2012, Hubei Henglong and SAIC-IVECO Hongyan Company, “SAIC-IVECO,” established a Sino-foreign joint venture company, Chongqing Henglong, to design, develop and manufacture both hydraulic and electric power steering systems and parts. 9. On August 21, 2012, Brazil Henglong was established as a Sino-foreign joint venture company by Hubei Henglong and two Brazilian citizens, Ozias Gaia Da Silva and Ademir Dal’ Evedove. Brazil Henglong engages mainly in the import and sales of automotive parts in Brazil. In May 2017, the Company obtained an additional 15.84% equity interest in Brazil Henglong for nil consideration. The Company retained its controlling interest in Brazil Henglong and the acquisition of the non-controlling interest was accounted for as an equity transaction. 10. In May 2014, together with Hubei Wanlong, Jielong formed a subsidiary, Wuhan Chuguanjie Automotive Science and Technology Ltd., “Wuhan Chuguanjie”, which mainly engages in research and development, manufacture and sales of automobile electronic systems and parts. Wuhan Chuguanjie is located in Wuhan, China. 11. In January 2015, Hubei Henglong formed Hubei Henglong Group Shanghai Automotive Electronics Research and Development Ltd., “Shanghai Henglong”, which mainly engages in the design and sales of automotive electronics. 12. In November 2017, Hubei Henglong formed Jingzhou Qingyan Intelligent Automotive Technology Research Institute Co., Ltd., “Jingzhou Qingyan”, which mainly engages in the research and development of intelligent automotive technology. 13. In August 2018, Hubei Henglong and KYB (China) Investment Co., Ltd. (“KYB”) established Hubei Henglong KYB Automobile Electric Steering System Co., Ltd., “Henglong KYB”, which mainly engages in design, manufacture, sales and after-sales service of automobile electronic systems. Hubei Henglong owns 66.6% of the shares of this entity and has consolidated it since its establishment. 14. In March 2019, Hubei Henglong and Hyoseong Electric Co., Ltd. established Hyoseong (Wuhan) Motion Mechatronics System Co., Ltd., “Wuhan Hyoseong”, which mainly engages in the design, manufacture and sales of automotive motors and electromechanical integrated systems. Hubei Henglong owns 51.0% of the shares of Wuhan Hyoseong and has consolidated it since its establishment. 15. In December 2019, Hubei Henglong formed Wuhu Hongrun New Material Co., Ltd., “Wuhu Hongrun”, which mainly engages in the development, manufacturing and sale of high polymer materials. Hubei Henglong owns 62.0% of the shares of Wuhu Hongrun and has consolidated it since its establishment. 16. In April 2020, Hubei Henglong acquired 100.0% of the equity interests of Changchun Hualong Automotive Technology Co., Ltd., “Changchun Hualong”, for total consideration of RMB 1.2 million, equivalent to approximately $0.2 million from an entity controlled by Hanlin Chen. Before the acquisition, 52.1% of the shares of Changchun Hualong were ultimately owned by Hanlin Chen and 47.9% of the shares were owned by third parties. Changchun Hualong mainly engages in design and R&D of automotive parts . |
Basis of presentation and signi
Basis of presentation and significant accounting policies | 3 Months Ended |
Mar. 31, 2022 | |
Basis of presentation and significant accounting policies | |
Basis of presentation and significant accounting policies | 2. Basis of presentation and significant accounting policies (a) Basis of Presentation Basis of Presentation – The accompanying condensed unaudited consolidated financial statements include the accounts of the Company and its subsidiaries. The details of subsidiaries are disclosed in Note 1. Significant inter-company balances and transactions have been eliminated upon consolidation. The condensed unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions in Regulation S-X. Accordingly they do not include all of the information and footnotes required by such accounting principles for complete financial statements. These financial statements should be read in conjunction with the consolidated financial statements and related footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. The accompanying interim condensed consolidated financial statements are unaudited, but in the opinion of the Company’s management, contain all necessary adjustments, which include normal recurring adjustments, for a fair statement of the results of operations, financial position and cash flows for the interim periods presented. The condensed consolidated balance sheet as of December 31, 2021 is derived from the Company’s audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The results of operations for the three months ended March 31, 2022 are not necessarily indicative of the results of operations to be expected for the full fiscal year ending December 31, 2022. Estimation - The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Foreign Currencies - China Automotive, the parent company, and HLUSA maintain their books and records in United States Dollars, “USD,” their functional currency. The Company’s subsidiaries based in the PRC and Genesis maintain their books and records in Renminbi, “RMB,” their functional currency. The Company’s subsidiary based in Brazil maintains its books and records in Brazilian real, “BRL,” its functional currency. In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 830, foreign currency transactions denominated in currencies other than the functional currency are remeasured into the functional currency at the rate of exchange prevailing at the balance sheet date for monetary items. Nonmonetary items are remeasured at historical rates. Income and expenses are remeasured at the rate in effect on the transaction dates. Transaction gains and losses, if any, are included in the determination of net income for the period. (b) Recent Accounting Pronouncements In November 2021, the FASB issued Accounting Standards Update (“ASU”) 2021-10 Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance, effective for financial statements issued for annual periods beginning after December 15, 2021. ASU 2021-10 requires business entities to disclose information in the notes to the financial statements about certain types of government assistance. The annual disclosure requirements apply to transactions with a government that are accounted for by analogizing to either a grant model or a contribution model. We plan to adopt ASU 2020-10 when we issue our annual financial statements. We do not expect it to have a material impact on our consolidated financial statements. (c) Significant Accounting Policies There have been no updates to the significant accounting policies set forth in the notes to the consolidated financial statements for the year ended December 31, 2021. |
Accounts and notes receivable,
Accounts and notes receivable, net | 3 Months Ended |
Mar. 31, 2022 | |
Accounts and notes receivable, net | |
Accounts and notes receivable, net | 3. Accounts and notes receivable, net The Company’s accounts and notes receivable, net as of March 31, 2022 and December 31, 2021 are summarized as follows (figures are in thousands of USD): March 31, 2022 December 31, 2021 Accounts receivable - unrelated parties $ 151,245 $ 146,362 Notes receivable - unrelated parties 72,643 61,328 Total accounts and notes receivable - unrelated parties 223,888 207,690 Less: allowance for doubtful accounts - unrelated parties (12,853) (11,961) Accounts and notes receivable, net - unrelated parties 211,035 195,729 Accounts and notes receivable - related parties 12,256 15,505 Less: allowance for doubtful accounts - related parties (894) (898) Accounts and notes receivable, net - related parties 11,362 14,607 Accounts and notes receivable, net $ 222,397 $ 210,336 Notes receivable represent accounts receivable in the form of bills of exchange for which acceptances are guaranteed and settlements are handled by banks. As of March 31, 2022 and December 31, 2021, the Company pledged its notes receivable in amounts of $19.7 million and $18.2 million, respectively, as collateral for banks to endorse the payment of the Company’s notes payable to the noteholders upon maturity (See Note 8). Provision for doubtful accounts and notes receivable, as provided in the unaudited consolidated statements of cash operations amounted to $0.1 million and $0.2 million, respectively, for the three months ended March 31,2022 and 2021. During the three months ended March 31, 2022, the Company’s five largest customers accounted for 46.7% of its consolidated net product sales, with one customer individually accounting for more than 10% of consolidated net sales, i.e., 22.1%. As of March 31, 2022, approximately 8.7% of accounts receivable were from trade transactions with the aforementioned customer and there was no individual customer with a receivables balance of more than 10% of total accounts receivable. During the three months ended March 31, 2021, the Company’s five largest customers accounted for 43.3% of its consolidated net product sales, with one customer accounting for more than 10% of consolidated net sales, i.e., 20.9%. As of March 31, 2021, approximately 8.8% of accounts receivable were from trade transactions with the aforementioned customer and there was no individual customer with a receivables balance of more than 10% of total accounts receivable. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2022 | |
Inventories | |
Inventories | 4. Inventories The Company’s inventories as of March 31, 2022 and December 31, 2021 consisted of the following (figures are in thousands of USD): March 31, 2022 December 31, 2021 Raw materials $ 36,215 $ 33,583 Work in process 10,114 9,415 Finished goods 68,154 73,495 Total $ 114,483 $ 116,493 The Company recorded $1.0 million and $1.0 million of inventory write-down to cost of products sold for the three months ended March 31, 2022 and 2021, respectively. |
Long-term Investments
Long-term Investments | 3 Months Ended |
Mar. 31, 2022 | |
Long-term Investments | |
Long-term Investments | 5. Long-term investments The Company’s long-term investments at March 31, 2022 and December 31, 2021, are summarized as follows (figures are in thousands of USD): March 31, 2022 December 31, 2021 Sentient AB (1) 24,452 — Chongqing Venture Fund (2) $ 15,085 $ 17,530 Hubei Venture Fund (3) 8,333 9,665 Suzhou Venture Fund (4) 5,634 7,413 Suzhou Qingshan (5) 4,727 — Henglong Tianyu 891 913 Chongqing Jinghua 578 642 Jiangsu Intelligent 960 803 Total $ 60,660 $ 36,966 (1) In June 2021, Hubei Henglong entered into a share purchase agreement with Jingzhou WiseDawn Electric Car Co., Ltd. , “Jingzhou WiseDawn ”, a related party controlled by the Company’s controlling shareholder, Mr. Chen Hanlin . In accordance with the agreement, CAAS would purchase 200 shares, representing 40% of Sentient AB’s share capital, from Jingzhou WiseDawn for total consideration of RMB 155.2 million, equivalent to approximately $24.5 million. The transaction was completed in March 2022. Pursuant to the share purchase agreement, the Company has the right to appoint two directors to the board of directors, so it can exercise significant influence over Sentient AB. Therefore, the investment is accounted for using the equity method. As of March 31, 2022, the Company has completed investment of RMB 86.0 million, equivalent to approximately $13.6 million , the remaining consideration of RMB 69.2 million, equivalent to approximately $10.9 million, will be paid in 2022. (2) In January and February 2022, Chongqing Venture Fund made distributions that were proportional to each owner’s allocated share of the fund, pursuant to which Hubei Henglong received $0.6 million in aggregate. (3) In January 2022, Hubei Venture Fund made distributions that were proportional to each owner’s allocated share of the fund, pursuant to which Hubei Henglong received $1.2 million. (4) In February 2022, Suzhou Venture Fund made distributions that were proportional to each owner’s allocated share of the fund, pursuant to which Hubei Henglong received $0.9 million. (5) In January 2022, Hubei Henglong entered into an agreement with other parties to establish a limited partnership, Suzhou Qingshan Zhiyuan Ventrue Capital Fund L.P., “Suzhou Qingshan”. As of March 31, 2022, Hubei Henglong has paid RMB 30.0 million, equivalent to approximately $4.7 million, representing 27.78% of Suzhou Qingshan’s equity. As a limited partner, Hubei Henglong has more than virtually no influence over Suzhou Qingshan’s operating and financial policies. The investment is accounted for using the equity method. The condensed financial information of the Company’s significant equity investees for the three months ended March 31, 2022 and 2021 are summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Revenue $ — $ — Gross profit — — (Loss) from continuing operations (20,578) (9,093) Net (loss) $ (20,578) $ (9,093) |
Property, plant and equipment,
Property, plant and equipment, net | 3 Months Ended |
Mar. 31, 2022 | |
Property, plant and equipment, net | |
Property, plant and equipment, net | 6. Property, plant and equipment, net The Company’s property, plant and equipment, net as of March 31, 2022 and December 31, 2021 are summarized as follows (figures are in thousands of USD): March 31, 2022 December 31, 2021 Costs: Buildings $ 71,798 $ 69,554 Machinery and equipment 256,334 253,245 Electronic equipment 6,997 6,887 Motor vehicles 5,108 5,121 Construction in progress 4,979 6,583 Total amount of property, plant and equipment 345,216 341,390 Less: Accumulated depreciation (1) (221,780) (213,669) Total amount of property, plant and equipment, net (2)(3) $ 123,436 $ 127,721 (1) Depreciation charges were $5.9 million and $6.4 million for the three months ended March 31, 2022 and 2021, respectively. (2) As of March 31, 2022 and December 31, 2021, the Company pledged property, plant and equipment with net book value of approximately $9.5 million and $54.7 million, respectively, as security for its comprehensive credit facilities with banks in China. (3) Interest costs capitalized for the three months ended March 31, 2022 and 2021, were $0.05 million and $0.16 million, respectively . |
Loans
Loans | 3 Months Ended |
Mar. 31, 2022 | |
Loans | |
Loans | 7 . Loans Loans consist of the following as of March 31, 2022 and December 31, 2021 (figures are in thousands of USD): March 31, 2022 December 31, 2021 Short-term bank loans (1) $ 48,185 $ 47,592 (1) The Company entered into credit facility agreements with various banks, which were secured by property, plant and equipment and land use rights of the Company. The total credit facility amount was $123.3 million and $116.8 million, respectively, as of March 31, 2022 and December 31, 2021. As of March 31, 2022, and December 31, 2021, the Company has drawn down loans with an aggregate amount of $48.2 million and $47.6 million, respectively. The weighted average interest rate was 3.3% and 3.5% , respectively. The Company must use the loans for the purpose as prescribed in the loan contracts. If the Company fails to do so, it will be charged penalty interest and/or trigger early repayment. The Company complied with such financial covenants as of March 31, 2022. |
Accounts and notes payable
Accounts and notes payable | 3 Months Ended |
Mar. 31, 2022 | |
Accounts and notes payable | |
Accounts and notes payable | 8. Accounts and notes payable The Company’s accounts and notes payable as of March 31, 2022 and December 31, 2021 are summarized as follows (figures are in thousands of USD): March 31, 2022 December 31, 2021 Accounts payable - unrelated parties $ 132,199 $ 132,593 Notes payable - unrelated parties (1) 83,693 81,997 Accounts and notes payable - unrelated parties 215,892 214,590 Accounts and notes payable - related parties 11,784 13,464 Total $ 227,676 $ 228,054 (1) Notes payable represent payables in the form of notes issued by the bank. As of March 31, 2022 and December 31, 2021, the Company has pledged cash of $30.0 million and $27.8 million, respectively. As of March 31, 2022 and December 31, 2021, the Company has pledged notes receivable of $19.7 million and $18.2 million, respectively, as collateral for banks to endorse the payment of the Company’s notes payable to the noteholders upon maturity. The Company entered into credit facility agreements with various banks, which were secured by property, plant and equipment and land use rights of the Company. As of March 31, 2022 and December 31, 2021, the Company has used $21.3 million and $33.6 million credit facility, respectively, for issuing bank notes . |
Accrued expenses and other paya
Accrued expenses and other payables | 3 Months Ended |
Mar. 31, 2022 | |
Accrued expenses and other payables | |
Accrued expenses and other payables | 9. Accrued expenses and other payables The Company’s accrued expenses and other payables as of March 31, 2022 and December 31, 2021 are summarized as follows (figures are in thousands of USD): March 31, 2022 December 31, 2021 Warranty reserves (1) $ 37,128 $ 36,572 Payable for the investment in Sentient AB (See Note 5) 10,905 — Accrued expenses 6,697 5,596 Current portion of other long-term payable (See Note 10) — 1,115 Payables for overseas transportation and custom clearance 1,731 4,548 Dividends payable to holders of non-controlling interests 473 471 Accrued interest 257 507 Other payables 1,149 1,523 Balance at end of year $ 58,340 $ 50,332 (1) The Company provides for the estimated cost of product warranties when the products are sold. Such estimates of product warranties are based on, among other things, historical experience, product changes, material expenses, services and transportation expenses arising from the manufactured products. Estimates will be adjusted on the basis of actual claims and circumstances. For the three months ended March 31, 2022 and 2021, the warranties activities were as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Balance at beginning of the period $ 36,572 $ 36,215 Additions during the period 3,888 3,681 Settlement within the period (3,476) (3,645) Foreign currency translation loss/(gain) 144 (266) Balance at end of the period $ 37,128 $ 35,985 |
Other long-term payable
Other long-term payable | 3 Months Ended |
Mar. 31, 2022 | |
Other long-term payable | |
Other long-term payable | 10. Other long-term payable On January 31, 2018, the Company entered into an equipment sales agreement with a third party (the “buyer-lessor”) and simultaneously entered into a four-year contract to lease back the equipment from the buyer-lessor. The carrying value of the equipment was RMB 91.3 million (equivalent to $14.4 million as of March 31, 2022) and the sales price was RMB 100.0 million (equivalent to $15.8 million as of March 31, 2022). Pursuant to the terms of the contract, the Company is required to pay to the buyer-lessor lease payments over four years with a quarterly lease payment of approximately $1.1 million and is entitled to obtain the ownership of this equipment at a nominal price upon the expiration of the lease. The Company is of the view that the transaction does not qualify as a sale. Therefore, the transaction was accounted for as a financing transaction by the Company. As of March 31, 2022, the payables have been fully paid. |
Redeemable non-controlling inte
Redeemable non-controlling interests | 3 Months Ended |
Mar. 31, 2022 | |
Redeemable non-controlling interests | |
Redeemable non-controlling interests | 11. Redeemable non-controlling interests In September 2020, one of the Company’s subsidiaries issued shares to Hubei Venture Fund amounting to $0.7 million. The shares will be transferred to the Company and the other shareholder of the subsidiary on a pro rata basis at the holder’s option if the subsidiary fails to complete a qualified IPO in a pre-agreed period of time after their issuance with a transfer price of par plus 6% per year. $0.5 million of the shares are subject to purchase by the Company and are therefore accounted for as redeemable non-controlling interests in mezzanine equity and are accreted to the redemption value over the period starting from the issuance date. For the three months ended March 31, 2022 and 2021, the Company recognized accretion of $0.008 million and $0.007 million, respectively, to the redemption value of the shares over the period starting from the issuance date with a corresponding reduction to retained earnings. |
Additional paid-in capital
Additional paid-in capital | 3 Months Ended |
Mar. 31, 2022 | |
Additional paid-in capital | |
Additional paid-in capital | 12. Additional paid-in capital The Company’s positions in respect of the amounts of additional paid-in capital for the three months ended March 31, 2022 and 2021, are summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Balance at beginning of the period $ 63,731 $ 64,273 Share-based compensation — 88 Balance at end of the period $ 63,731 $ 64,361 |
Retained Earnings
Retained Earnings | 3 Months Ended |
Mar. 31, 2022 | |
Retained Earnings | |
Retained Earnings | 13. Retained earnings Appropriated Pursuant to the relevant PRC laws, the profits distribution of the Company’s subsidiaries, which are based on their PRC statutory financial statements, are available for distribution in the form of cash dividends after these subsidiaries have paid all relevant PRC tax liabilities, provided for losses in previous years, and made appropriations to statutory surplus at 10% of their respective after-tax profits each year. When the statutory surplus reserve reaches 50% of the registered capital of a company, no additional reserve is required. For the three months ended March 31, 2022 and 2021, no statutory reserve was appropriated by the subsidiaries in China. The Company’s activities in respect of the amounts of appropriated retained earnings for the three months ended March 31, 2022 and 2021, are summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Balance at beginning of the period $ 11,481 $ 11,303 Balance at end of the period $ 11,481 $ 11,303 Unappropriated The Company’s activities in respect of the amounts of the unappropriated retained earnings for the three months ended March 31, 2022 and 2021, are summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Balance at beginning of the period $ 226,363 $ 215,491 Net (loss)/income attributable to parent company (51) 3,213 Accretion of redeemable non-controlling interests (8) (7) Balance at end of the period $ 226,304 $ 218,697 |
Accumulated other comprehensive
Accumulated other comprehensive income | 3 Months Ended |
Mar. 31, 2022 | |
Accumulated other comprehensive income | |
Accumulated other comprehensive income | 14. Accumulated other comprehensive income The Company’s activities in respect of the amounts of accumulated other comprehensive income for the three months ended March 31, 2022 and 2021, are summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Balance at beginning of the period $ 24,717 $ 17,413 Foreign currency translation adjustment attributable to parent company 1,348 (2,128) Balance at end of the period $ 26,065 $ 15,285 |
Treasury Stock
Treasury Stock | 3 Months Ended |
Mar. 31, 2022 | |
Treasury Stock | |
Treasury Stock | 15. Treasury stock Treasury stock represents shares repurchased by the Company that are no longer outstanding and are held by the Company. Treasury stock is accounted for under the cost method. On March 29, 2022, the Board of Directors of the Company approved a share repurchase program under which the Company was permitted to repurchase up to $5.0 million of its common stock from time to time in the open market at prevailing market prices not to exceed $4.00 per share through March 30, 2023. As of the report date, the Company has not repurchased any shares of the Company’s common stock. |
Non-controlling interests
Non-controlling interests | 3 Months Ended |
Mar. 31, 2022 | |
Non-controlling interests | |
Non-controlling interests | 16. Non-controlling interests The Company’s activities in respect of the amounts of the non-controlling interests’ equity for the three months ended March 31, 2022 and 2021, are summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Balance at beginning of the period $ 15,854 $ 16,170 Net income attributable to non-controlling interests 200 18 Foreign currency translation adjustment attributable to non-controlling interests 89 (143) Balance at end of the period $ 16,143 $ 16,045 |
Net product sales
Net product sales | 3 Months Ended |
Mar. 31, 2022 | |
Net product sales | |
Net product sales | 17. Net product sales Revenue Disaggregation Management has concluded that the disaggregation level is the same under both the revenue standard and the segment reporting standard. Please refer to Note 24. Contract Assets and Liabilities Contract assets, such as costs to obtain or fulfill contracts, are an insignificant component of the Company’s revenue recognition process. The majority of the Company’s cost of fulfillment as a manufacturer of products is classified as inventory, fixed assets and intangible assets, which are accounted for under the respective guidance for those asset types. Other costs of contract fulfillment are immaterial due to the nature of the Company’s products and their respective manufacturing processes. Contract liabilities are mainly customer deposits. As of March 31, 2022 and December 31, 2021, the Company has customer deposits of $3.7 million and $2.4 million, respectively, which were included in other current liabilities on the consolidated balance sheets. During the three months ended March 31, 2022, $2.3 million was received and $1.0 million (including $1.0 million from the beginning balance of customer deposits) was recognized as net product sales revenue. During the three months ended March 31, 2021, $1.0 million was received and $1.4 million (including $1.4 million from the beginning balance of customer deposits) was recognized as net product sales revenue. Customer deposits represent non-refundable cash deposits for customers to secure rights to an amount of products produced by the Company under supply agreements. When the products are shipped to customers, the Company will recognize revenue and bill the customers to reduce the amount of the customer deposit liability. |
Financial income(expense), net
Financial income(expense), net | 3 Months Ended |
Mar. 31, 2022 | |
Financial income/(expense), net | |
Financial Expense, net | 18. Financial income/(expense), net During the three months ended March 31, 2022 and 2021, the Company recorded financial income/(expense), net which is summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Interest income $ 251 $ 313 Foreign exchange gain/(loss), net 1,910 (469) Bank charges (146) (83) Total financial income/(expense), net $ 2,015 $ (239) |
Income (Loss) Per Share
Income (Loss) Per Share | 3 Months Ended |
Mar. 31, 2022 | |
Income/(Loss) Per Share | |
Income/(Loss) Per Share | 19. Income/(loss) per share Basic income per share is computed using the weighted average number of ordinary shares outstanding during the period. Diluted income per share is computed using the weighted average number of ordinary shares and dilutive ordinary share equivalents outstanding during the period. The dilutive effect of outstanding stock options is determined based on the treasury stock method. The calculations of basic and diluted income per share attributable to the parent company for the three months ended March 31, 2022 and 2021, were as follows (figures are in thousands of USD, except share and per share amounts): Three Months Ended March 31, 2022 2021 Numerator: Net (loss)/income attributable to the parent company’s common shareholders - Basic and Diluted $ (59) $ 3,206 Denominator: Weighted average shares outstanding 30,851,776 30,851,776 Dilutive effects of stock options — 5,960 Denominator for dilutive income per share - Diluted 30,851,776 30,857,736 Net (loss)/income per share attributable to parent company’s common shareholders - Basic $ (0.00) $ 0.10 Net (loss)/income per share attributable to parent company’s common shareholders - Diluted $ (0.00) $ 0.10 As of March 31, 2021, the exercise prices for 30,000 outstanding stock options were above the weighted average market price of the Company’s common stock during the three months ended March 31, 2021. Therefore, these stock options were excluded from the calculation of the diluted income per share for the corresponding periods presented. For the three months ended March 31, 2022, assumed conversion of the stock options has not been reflected in the dilutive calculation pursuant to ASC 260, “Earnings Per Share,” due to the anti-dilutive effect as a result of the Company’s net loss. The effects of all outstanding share options with common share equivalents of 954 shares have been excluded from the calculation of the diluted loss per share for the three months ended March 31, 2022, due to their anti-dilutive effect. |
Significant Concentrations
Significant Concentrations | 3 Months Ended |
Mar. 31, 2022 | |
Significant Concentrations | |
Significant Concentrations | 20. Significant concentrations A significant portion of the Company’s business is conducted in China where the currency is the RMB. Regulations in China permit foreign owned entities to freely convert the RMB into foreign currency for transactions that fall under the “current account”, which includes trade related receipts and payments, interest and dividends. Accordingly, the Company’s Chinese subsidiaries may use RMB to purchase foreign currency for settlement of such “current account” transactions without pre-approval. China Automotive, the parent company, may depend on dividend payments from Genesis and HLUSA, which are generated from their subsidiaries in China, “China-based Subsidiaries,” after they receive payments from the China-based Subsidiaries. Regulations in the PRC currently permit payment of dividends of a PRC company only out of accumulated profits as determined in accordance with accounting standards and regulations in China. Under PRC law China-based Subsidiaries are required to set aside at least 10% of their after-tax profit based on PRC accounting standards each year to their general reserves until the cumulative amount reaches 50% of their paid-in capital. These reserves are not distributable as cash dividends, or as loans or advances. These foreign-invested enterprises may also allocate a portion of their after-tax profits, at the discretion of their boards of directors, to their staff welfare and bonus funds. Any amounts so allocated may not be distributed and, accordingly, would not be available for distribution to Genesis and HLUSA. The PRC government also imposes controls on the convertibility of RMB into foreign currencies and, in certain cases, the remittance of currencies out of China. The China-based Subsidiaries may experience difficulties in completing the administrative procedures necessary to obtain and remit foreign currencies. If China Automotive is unable to receive dividend payments from its subsidiaries, including the China-based subsidiaries, China Automotive may be unable to effectively finance its operations or pay dividends on its shares. Transactions other than those that fall under the “current account” and that involve conversion of RMB into foreign currency are classified as “capital account” transactions; examples of “capital account” transactions include repatriations of investment by or loans to foreign owners, or direct equity investments in a foreign entity by a China domiciled entity. “Capital account” transactions require prior approval from China’s State Administration of Foreign Exchange, or SAFE, or its provincial branch to convert a remittance into a foreign currency, such as U.S. Dollars, and transmit the foreign currency outside of China. This system could be changed at any time and any such change may affect the ability of the Company or its subsidiaries in China to repatriate capital or profits, if any, outside China. Furthermore, SAFE has a significant degree of administrative discretion in implementing the laws and has used this discretion to limit convertibility of current account payments out of China. Whether as a result of a deterioration in the Chinese balance of payments, a shift in the Chinese macroeconomic prospects or any number of other reasons, China could impose additional restrictions on capital remittances abroad. As a result of these and other restrictions under the laws and regulations of the People’s Republic of China, or the PRC, the Company’s China subsidiaries are restricted in their ability to transfer a portion of their net assets to the parent. The Company has no assurance that the relevant Chinese governmental authorities in the future will not limit further or eliminate the ability of the Company’s China subsidiaries to purchase foreign currencies and transfer such funds to the Company to meet its liquidity or other business needs. Any inability to access funds in China, if and when needed for use by the Company outside of China, could have a material and adverse effect on the Company’s liquidity and its business. |
Related party transactions and
Related party transactions and balances | 3 Months Ended |
Mar. 31, 2022 | |
Related party transactions and balances | |
Related party transactions and balances | 21. Related party transactions and balances Related party transactions are as follows (figures are in thousands of USD): Related party sales Three Months Ended March 31, 2022 2021 Merchandise sold to related parties $ 11,004 $ 16,575 Materials and others sold to related parties 605 426 Rental income obtained from related parties 125 106 Total $ 11,734 $ 17,107 Related party purchases Three Months Ended March 31, 2022 2021 Materials purchased from related parties $ 7,540 $ 8,214 Equipment purchased from related parties 449 225 Others purchased from related parties 157 10 Total $ 8,146 $ 8,449 Related party investment transaction Three Months Ended March 31, 2022 2021 Equity interest purchase from related parties $ 24,452 $ — Related party receivables March 31, 2022 December 31, 2021 Accounts and notes receivable, net from related parties $ 11,362 $ 14,607 Related party advance payments March 31, 2022 December 31, 2021 Advance payments for property, plant and equipment to related parties $ 1,159 $ 810 Advance payments and others to related parties 1,520 600 Total $ 2,679 $ 1,410 Related party payables March 31, 2022 December 31, 2021 Accounts and notes payable $ 11,784 $ 13,464 Accrued expenses and other payables to related parties 10,905 — Total 22,689 13,464 These transactions were consummated under similar terms as those with the Company’s third party customers and suppliers. As of May 23, 2022, Hanlin Chen, the chairman of the board of directors of the Company, owns 57.9% of the common stock of the Company and has the effective power to control the vote on substantially all significant matters without the approval of other stockholders. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies | |
Commitments and Contingencies | 22. Commitments and contingencies Legal proceedings The Company is not a party to any pending or, to the best of the Company’s knowledge, any threatened legal proceedings and no director, officer or affiliate of the Company, or owner of record of more than five percent of the securities of the Company, or any associate of any such director, officer or security holder is a party adverse to the Company or has a material interest adverse to the Company in reference to pending litigation. Other commitments and contingencies In addition to the bank loans, notes payables and the related interest, the following table summarizes the Company’s major commitments and contingencies as of March 31, 2022 (figures are in thousands of USD): Payment obligations by period 2022 2023 2024 Thereafter Total Obligations for investment contracts (1) $ — $ 4,726 $ — $ — $ 4,726 Obligations for purchasing and service agreements 22,925 2,004 — — 24,929 Total $ 22,925 $ 6,730 $ — $ — $ 29,655 (1) In January 2022, Hubei Henglong entered into an agreement with other parties and committed to purchase 27.78% of the shares of Suzhou Qingshan for total consideration of RMB 60.0 million, equivalent to approximately $9.5 million. As of March 31, 2022, Hubei Henglong has paid RMB 30.0 million, equivalent to approximately $4.7 million, which was reported in long term investment using equity mehod. According to the agreement, the remaining consideration of RMB 30.0 million, equivalent to approximately $4.7 million, will be paid in 2023. |
Off-balance sheet arrangements
Off-balance sheet arrangements | 3 Months Ended |
Mar. 31, 2022 | |
Off-balance sheet arrangements | |
Off-balance sheet arrangements | 23 . Off-balance sheet arrangements As of March 31, 2022 and December 31, 2021, the Company did not have any significant transactions, obligations or relationships that could be considered off-balance sheet arrangements. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2022 | |
Segment Reporting | |
Segment Reporting | 24. Segment reporting The accounting policies of the product sectors (each entity manufactures and sells different products and represents a different product sector) are the same as those described in the summary of significant accounting policies disclosed in the Company’s 2021 Annual Report on Form 10-K except that the disaggregated financial results for the product sectors have been prepared using a management approach, which is consistent with the basis and manner in which management internally disaggregates financial information for the purposes of assisting them in making internal operating decisions. Generally, the Company evaluates performance based on stand-alone product sector operating income and accounts for inter-segment sales and transfers as if the sales or transfers were to third parties, at current market prices. Each product sector is considered a reporting segment. As of March 31, 2022 and 2021, the Company had 15 product sectors, seven of which were principal profit makers and were reported as separate sectors and engaged in the production and sales of power steering (Henglong, Jiulong, Shenyang, Wuhu, Henglong KYB, Hubei Henglong, and Brazil Henglong), and one holding company (Genesis). The other eight sectors were engaged in the development, manufacturing and sale of high polymer materials (Wuhu Hongrun), R&D services (Changchun Hualong), automobile steering columns (Jielong), provision of after-sales and R&D services (HLUSA), production and sale of power steering (Chongqing Henglong), manufacture and sales of automobile electronic systems and parts (Wuhan Chuguanjie), research and development of intelligent automotive technology (Jingzhou Qingyan) and manufacture and sales of automotive motors and electromechanical integrated systems (Wuhan Hyoseong). The Company’s product sector information for the three months ended March 31, 2022 and 2021, is as follows (figures are in thousands of USD): Net Product Sales Net (Loss)/Income Three Months Ended Three Months Ended March 31, March 31, 2022 2021 2022 2021 Henglong $ 62,003 $ 49,079 $ 1,199 $ 799 Jiulong 17,728 33,719 (2,434) 1,000 Shenyang 3,311 4,092 (60) 353 Wuhu 8,872 4,159 2 7 Hubei Henglong 32,943 35,458 (2,837) 666 Henglong KYB 29,807 18,206 569 165 Brazil Henglong 10,484 4,915 2,815 413 Other Entities 19,849 16,322 1,147 95 Total Segments 184,997 165,950 401 3,498 Corporate — — (235) (217) Eliminations (48,601) (35,609) (17) (50) Total $ 136,396 $ 130,341 $ 149 $ 3,231 |
Basis of presentation and sig_2
Basis of presentation and significant accounting policies (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Basis of presentation and significant accounting policies | |
Basis of Presentation | (a) Basis of Presentation Basis of Presentation – The accompanying condensed unaudited consolidated financial statements include the accounts of the Company and its subsidiaries. The details of subsidiaries are disclosed in Note 1. Significant inter-company balances and transactions have been eliminated upon consolidation. The condensed unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions in Regulation S-X. Accordingly they do not include all of the information and footnotes required by such accounting principles for complete financial statements. These financial statements should be read in conjunction with the consolidated financial statements and related footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. The accompanying interim condensed consolidated financial statements are unaudited, but in the opinion of the Company’s management, contain all necessary adjustments, which include normal recurring adjustments, for a fair statement of the results of operations, financial position and cash flows for the interim periods presented. The condensed consolidated balance sheet as of December 31, 2021 is derived from the Company’s audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The results of operations for the three months ended March 31, 2022 are not necessarily indicative of the results of operations to be expected for the full fiscal year ending December 31, 2022. Estimation - The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Foreign Currencies - China Automotive, the parent company, and HLUSA maintain their books and records in United States Dollars, “USD,” their functional currency. The Company’s subsidiaries based in the PRC and Genesis maintain their books and records in Renminbi, “RMB,” their functional currency. The Company’s subsidiary based in Brazil maintains its books and records in Brazilian real, “BRL,” its functional currency. In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 830, foreign currency transactions denominated in currencies other than the functional currency are remeasured into the functional currency at the rate of exchange prevailing at the balance sheet date for monetary items. Nonmonetary items are remeasured at historical rates. Income and expenses are remeasured at the rate in effect on the transaction dates. Transaction gains and losses, if any, are included in the determination of net income for the period. |
Recent Accounting Pronouncements | (b) Recent Accounting Pronouncements In November 2021, the FASB issued Accounting Standards Update (“ASU”) 2021-10 Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance, effective for financial statements issued for annual periods beginning after December 15, 2021. ASU 2021-10 requires business entities to disclose information in the notes to the financial statements about certain types of government assistance. The annual disclosure requirements apply to transactions with a government that are accounted for by analogizing to either a grant model or a contribution model. We plan to adopt ASU 2020-10 when we issue our annual financial statements. We do not expect it to have a material impact on our consolidated financial statements. |
Significant Accounting Policies | (c) Significant Accounting Policies There have been no updates to the significant accounting policies set forth in the notes to the consolidated financial statements for the year ended December 31, 2021. |
Organization and business (Tabl
Organization and business (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Organization and business | |
Schedule of equity method investments | The Company owns the following aggregate net interests in the following subsidiaries organized in the People’s Republic of China, the “PRC,” and Brazil as of March 31, 2022 and December 31, 2021. Percentage Interest March 31, December 31, Name of Entity 2022 2021 Shashi Jiulong Power Steering Gears Co., Ltd., “Jiulong” 1 100.00 % 100.00 % Jingzhou Henglong Automotive Parts Co., Ltd., “Henglong” 2 100.00 % 100.00 % Shenyang Jinbei Henglong Automotive Steering System Co., Ltd., “Shenyang” 3 70.00 % 70.00 % Wuhan Jielong Electric Power Steering Co., Ltd., “Jielong” 4 85.00 % 85.00 % Wuhu Henglong Automotive Steering System Co., Ltd., “Wuhu” 5 100.00 % 100.00 % Hubei Henglong Automotive System Group Co., Ltd., “Hubei Henglong” 6 100.00 % 100.00 % Jingzhou Henglong Automotive Technology (Testing) Center, “Testing Center” 7 100.00 % 100.00 % Chongqing Henglong Hongyan Automotive System Co., Ltd., “Chongqing Henglong” 8 70.00 % 70.00 % CAAS Brazil’s Imports and Trade In Automotive Parts Ltd., “Brazil Henglong” 9 95.84 % 95.84 % Wuhan Chuguanjie Automotive Science and Technology Ltd., “Wuhan Chuguanjie” 10 85.00 % 85.00 % Hubei Henglong Group Shanghai Automotive Electronics Research and Development Ltd., “Shanghai Henglong” 11 100.00 % 100.00 % Jingzhou Qingyan Intelligent Automotive Technology Research Institute Co., Ltd., “Jingzhou Qingyan” 12 60.00 % 60.00 % Hubei Henglong & KYB Automobile Electric Steering System Co., Ltd., “Henglong KYB” 13 66.60 % 66.60 % Hyoseong (Wuhan) Motion Mechatronics System Co., Ltd., “Wuhan Hyoseong” 14 51.00 % 51.00 % Wuhu Hongrun New Material Co., Ltd., “Wuhu Hongrun” 15 62.00 % 62.00 % Changchun Hualong Automotive Technology Co., Ltd., “Changchun Hualong” 16 100.00 % 100.00 % 1. Jiulong was established in 1993 and mainly engages in the production of integral power steering gears for heavy-duty vehicles. 2. Henglong was established in 1997 and mainly engages in the production of rack and pinion power steering gears for cars and light duty vehicles. 3. Shenyang was established in 2002 and focuses on power steering parts for light duty vehicles. 4. Jielong was established in 2006 and mainly engages in the production and sales of automotive steering columns. 5. Wuhu was established in 2006 and mainly engages in the production and sales of automobile steering systems. In April 2021, the Company obtained an additional 22.67% equity interest in Wuhu for total consideration of RMB 6.9 million, equivalent to approximately $ 1.1 million , from the other shareholder. The Company retained its controlling interest in Wuhu and the acquisition of the additional 22.67% equity interest in Wuhu was accounted for as an equity transaction. 6. On March 7, 2007, Genesis established Hubei Henglong, formerly known as Jingzhou Hengsheng Automotive System Co., Ltd., its wholly-owned subsidiary, to engage in the production and sales of automotive steering systems. On July 8, 2012, Hubei Henglong changed its name to Hubei Henglong Automotive System Group Co., Ltd. 7. In December 2009, Henglong, a subsidiary of Genesis, formed Testing Center, which mainly engages in the research and development of new products. 8. On February 21, 2012, Hubei Henglong and SAIC-IVECO Hongyan Company, “SAIC-IVECO,” established a Sino-foreign joint venture company, Chongqing Henglong, to design, develop and manufacture both hydraulic and electric power steering systems and parts. 9. On August 21, 2012, Brazil Henglong was established as a Sino-foreign joint venture company by Hubei Henglong and two Brazilian citizens, Ozias Gaia Da Silva and Ademir Dal’ Evedove. Brazil Henglong engages mainly in the import and sales of automotive parts in Brazil. In May 2017, the Company obtained an additional 15.84% equity interest in Brazil Henglong for nil consideration. The Company retained its controlling interest in Brazil Henglong and the acquisition of the non-controlling interest was accounted for as an equity transaction. 10. In May 2014, together with Hubei Wanlong, Jielong formed a subsidiary, Wuhan Chuguanjie Automotive Science and Technology Ltd., “Wuhan Chuguanjie”, which mainly engages in research and development, manufacture and sales of automobile electronic systems and parts. Wuhan Chuguanjie is located in Wuhan, China. 11. In January 2015, Hubei Henglong formed Hubei Henglong Group Shanghai Automotive Electronics Research and Development Ltd., “Shanghai Henglong”, which mainly engages in the design and sales of automotive electronics. 12. In November 2017, Hubei Henglong formed Jingzhou Qingyan Intelligent Automotive Technology Research Institute Co., Ltd., “Jingzhou Qingyan”, which mainly engages in the research and development of intelligent automotive technology. 13. In August 2018, Hubei Henglong and KYB (China) Investment Co., Ltd. (“KYB”) established Hubei Henglong KYB Automobile Electric Steering System Co., Ltd., “Henglong KYB”, which mainly engages in design, manufacture, sales and after-sales service of automobile electronic systems. Hubei Henglong owns 66.6% of the shares of this entity and has consolidated it since its establishment. 14. In March 2019, Hubei Henglong and Hyoseong Electric Co., Ltd. established Hyoseong (Wuhan) Motion Mechatronics System Co., Ltd., “Wuhan Hyoseong”, which mainly engages in the design, manufacture and sales of automotive motors and electromechanical integrated systems. Hubei Henglong owns 51.0% of the shares of Wuhan Hyoseong and has consolidated it since its establishment. 15. In December 2019, Hubei Henglong formed Wuhu Hongrun New Material Co., Ltd., “Wuhu Hongrun”, which mainly engages in the development, manufacturing and sale of high polymer materials. Hubei Henglong owns 62.0% of the shares of Wuhu Hongrun and has consolidated it since its establishment. 16. In April 2020, Hubei Henglong acquired 100.0% of the equity interests of Changchun Hualong Automotive Technology Co., Ltd., “Changchun Hualong”, for total consideration of RMB 1.2 million, equivalent to approximately $0.2 million from an entity controlled by Hanlin Chen. Before the acquisition, 52.1% of the shares of Changchun Hualong were ultimately owned by Hanlin Chen and 47.9% of the shares were owned by third parties. Changchun Hualong mainly engages in design and R&D of automotive parts . |
Accounts and notes receivable_2
Accounts and notes receivable, net (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accounts and notes receivable, net | |
Schedule of accounts and notes receivable | The Company’s accounts and notes receivable, net as of March 31, 2022 and December 31, 2021 are summarized as follows (figures are in thousands of USD): March 31, 2022 December 31, 2021 Accounts receivable - unrelated parties $ 151,245 $ 146,362 Notes receivable - unrelated parties 72,643 61,328 Total accounts and notes receivable - unrelated parties 223,888 207,690 Less: allowance for doubtful accounts - unrelated parties (12,853) (11,961) Accounts and notes receivable, net - unrelated parties 211,035 195,729 Accounts and notes receivable - related parties 12,256 15,505 Less: allowance for doubtful accounts - related parties (894) (898) Accounts and notes receivable, net - related parties 11,362 14,607 Accounts and notes receivable, net $ 222,397 $ 210,336 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Inventories | |
Schedule of inventories | The Company’s inventories as of March 31, 2022 and December 31, 2021 consisted of the following (figures are in thousands of USD): March 31, 2022 December 31, 2021 Raw materials $ 36,215 $ 33,583 Work in process 10,114 9,415 Finished goods 68,154 73,495 Total $ 114,483 $ 116,493 |
Long-term Investments (Tables)
Long-term Investments (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Long-term Investments | |
Schedule of long-term investments | The Company’s long-term investments at March 31, 2022 and December 31, 2021, are summarized as follows (figures are in thousands of USD): March 31, 2022 December 31, 2021 Sentient AB (1) 24,452 — Chongqing Venture Fund (2) $ 15,085 $ 17,530 Hubei Venture Fund (3) 8,333 9,665 Suzhou Venture Fund (4) 5,634 7,413 Suzhou Qingshan (5) 4,727 — Henglong Tianyu 891 913 Chongqing Jinghua 578 642 Jiangsu Intelligent 960 803 Total $ 60,660 $ 36,966 (1) In June 2021, Hubei Henglong entered into a share purchase agreement with Jingzhou WiseDawn Electric Car Co., Ltd. , “Jingzhou WiseDawn ”, a related party controlled by the Company’s controlling shareholder, Mr. Chen Hanlin . In accordance with the agreement, CAAS would purchase 200 shares, representing 40% of Sentient AB’s share capital, from Jingzhou WiseDawn for total consideration of RMB 155.2 million, equivalent to approximately $24.5 million. The transaction was completed in March 2022. Pursuant to the share purchase agreement, the Company has the right to appoint two directors to the board of directors, so it can exercise significant influence over Sentient AB. Therefore, the investment is accounted for using the equity method. As of March 31, 2022, the Company has completed investment of RMB 86.0 million, equivalent to approximately $13.6 million , the remaining consideration of RMB 69.2 million, equivalent to approximately $10.9 million, will be paid in 2022. (2) In January and February 2022, Chongqing Venture Fund made distributions that were proportional to each owner’s allocated share of the fund, pursuant to which Hubei Henglong received $0.6 million in aggregate. (3) In January 2022, Hubei Venture Fund made distributions that were proportional to each owner’s allocated share of the fund, pursuant to which Hubei Henglong received $1.2 million. (4) In February 2022, Suzhou Venture Fund made distributions that were proportional to each owner’s allocated share of the fund, pursuant to which Hubei Henglong received $0.9 million. (5) In January 2022, Hubei Henglong entered into an agreement with other parties to establish a limited partnership, Suzhou Qingshan Zhiyuan Ventrue Capital Fund L.P., “Suzhou Qingshan”. As of March 31, 2022, Hubei Henglong has paid RMB 30.0 million, equivalent to approximately $4.7 million, representing 27.78% of Suzhou Qingshan’s equity. As a limited partner, Hubei Henglong has more than virtually no influence over Suzhou Qingshan’s operating and financial policies. The investment is accounted for using the equity method. |
Summary of condensed financial information of company's equity method investments | The condensed financial information of the Company’s significant equity investees for the three months ended March 31, 2022 and 2021 are summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Revenue $ — $ — Gross profit — — (Loss) from continuing operations (20,578) (9,093) Net (loss) $ (20,578) $ (9,093) |
Property, plant and equipment_2
Property, plant and equipment, net (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Property, plant and equipment, net | |
Schedule of Property, plant and equipment, net | The Company’s property, plant and equipment, net as of March 31, 2022 and December 31, 2021 are summarized as follows (figures are in thousands of USD): March 31, 2022 December 31, 2021 Costs: Buildings $ 71,798 $ 69,554 Machinery and equipment 256,334 253,245 Electronic equipment 6,997 6,887 Motor vehicles 5,108 5,121 Construction in progress 4,979 6,583 Total amount of property, plant and equipment 345,216 341,390 Less: Accumulated depreciation (1) (221,780) (213,669) Total amount of property, plant and equipment, net (2)(3) $ 123,436 $ 127,721 (1) Depreciation charges were $5.9 million and $6.4 million for the three months ended March 31, 2022 and 2021, respectively. (2) As of March 31, 2022 and December 31, 2021, the Company pledged property, plant and equipment with net book value of approximately $9.5 million and $54.7 million, respectively, as security for its comprehensive credit facilities with banks in China. (3) Interest costs capitalized for the three months ended March 31, 2022 and 2021, were $0.05 million and $0.16 million, respectively . |
Loans (Tables)
Loans (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Loans | |
Schedule of loans | Loans consist of the following as of March 31, 2022 and December 31, 2021 (figures are in thousands of USD): March 31, 2022 December 31, 2021 Short-term bank loans (1) $ 48,185 $ 47,592 (1) The Company entered into credit facility agreements with various banks, which were secured by property, plant and equipment and land use rights of the Company. The total credit facility amount was $123.3 million and $116.8 million, respectively, as of March 31, 2022 and December 31, 2021. As of March 31, 2022, and December 31, 2021, the Company has drawn down loans with an aggregate amount of $48.2 million and $47.6 million, respectively. The weighted average interest rate was 3.3% and 3.5% , respectively. |
Accounts and notes payable (Tab
Accounts and notes payable (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accounts and notes payable | |
Schedule of accounts and notes payable | The Company’s accounts and notes payable as of March 31, 2022 and December 31, 2021 are summarized as follows (figures are in thousands of USD): March 31, 2022 December 31, 2021 Accounts payable - unrelated parties $ 132,199 $ 132,593 Notes payable - unrelated parties (1) 83,693 81,997 Accounts and notes payable - unrelated parties 215,892 214,590 Accounts and notes payable - related parties 11,784 13,464 Total $ 227,676 $ 228,054 (1) Notes payable represent payables in the form of notes issued by the bank. As of March 31, 2022 and December 31, 2021, the Company has pledged cash of $30.0 million and $27.8 million, respectively. As of March 31, 2022 and December 31, 2021, the Company has pledged notes receivable of $19.7 million and $18.2 million, respectively, as collateral for banks to endorse the payment of the Company’s notes payable to the noteholders upon maturity. The Company entered into credit facility agreements with various banks, which were secured by property, plant and equipment and land use rights of the Company. As of March 31, 2022 and December 31, 2021, the Company has used $21.3 million and $33.6 million credit facility, respectively, for issuing bank notes . |
Accrued expenses and other pa_2
Accrued expenses and other payables (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accrued expenses and other payables | |
Schedule of accrued expenses and other payables | The Company’s accrued expenses and other payables as of March 31, 2022 and December 31, 2021 are summarized as follows (figures are in thousands of USD): March 31, 2022 December 31, 2021 Warranty reserves (1) $ 37,128 $ 36,572 Payable for the investment in Sentient AB (See Note 5) 10,905 — Accrued expenses 6,697 5,596 Current portion of other long-term payable (See Note 10) — 1,115 Payables for overseas transportation and custom clearance 1,731 4,548 Dividends payable to holders of non-controlling interests 473 471 Accrued interest 257 507 Other payables 1,149 1,523 Balance at end of year $ 58,340 $ 50,332 (1) The Company provides for the estimated cost of product warranties when the products are sold. Such estimates of product warranties are based on, among other things, historical experience, product changes, material expenses, services and transportation expenses arising from the manufactured products. Estimates will be adjusted on the basis of actual claims and circumstances. |
Schedule of product warranty liability | For the three months ended March 31, 2022 and 2021, the warranties activities were as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Balance at beginning of the period $ 36,572 $ 36,215 Additions during the period 3,888 3,681 Settlement within the period (3,476) (3,645) Foreign currency translation loss/(gain) 144 (266) Balance at end of the period $ 37,128 $ 35,985 |
Additional paid-in capital (Tab
Additional paid-in capital (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Additional paid-in capital | |
Schedule of additional paid-in capital | The Company’s positions in respect of the amounts of additional paid-in capital for the three months ended March 31, 2022 and 2021, are summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Balance at beginning of the period $ 63,731 $ 64,273 Share-based compensation — 88 Balance at end of the period $ 63,731 $ 64,361 |
Retained earnings (Tables)
Retained earnings (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Retained Earnings | |
Schedule of appropriated retained earnings | The Company’s activities in respect of the amounts of appropriated retained earnings for the three months ended March 31, 2022 and 2021, are summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Balance at beginning of the period $ 11,481 $ 11,303 Balance at end of the period $ 11,481 $ 11,303 |
Schedule of unappropriated retained earnings | The Company’s activities in respect of the amounts of the unappropriated retained earnings for the three months ended March 31, 2022 and 2021, are summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Balance at beginning of the period $ 226,363 $ 215,491 Net (loss)/income attributable to parent company (51) 3,213 Accretion of redeemable non-controlling interests (8) (7) Balance at end of the period $ 226,304 $ 218,697 |
Accumulated other comprehensi_2
Accumulated other comprehensive income (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Accumulated other comprehensive income | |
Schedule of accumulated other comprehensive income | The Company’s activities in respect of the amounts of accumulated other comprehensive income for the three months ended March 31, 2022 and 2021, are summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Balance at beginning of the period $ 24,717 $ 17,413 Foreign currency translation adjustment attributable to parent company 1,348 (2,128) Balance at end of the period $ 26,065 $ 15,285 |
Non-controlling interests (Tabl
Non-controlling interests (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Non-controlling interests | |
Schedule of non-controlling interests | The Company’s activities in respect of the amounts of the non-controlling interests’ equity for the three months ended March 31, 2022 and 2021, are summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Balance at beginning of the period $ 15,854 $ 16,170 Net income attributable to non-controlling interests 200 18 Foreign currency translation adjustment attributable to non-controlling interests 89 (143) Balance at end of the period $ 16,143 $ 16,045 |
Financial income(expense), net
Financial income(expense), net (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Financial income/(expense), net | |
Schedule of recorded financial expense, net | During the three months ended March 31, 2022 and 2021, the Company recorded financial income/(expense), net which is summarized as follows (figures are in thousands of USD): Three Months Ended March 31, 2022 2021 Interest income $ 251 $ 313 Foreign exchange gain/(loss), net 1,910 (469) Bank charges (146) (83) Total financial income/(expense), net $ 2,015 $ (239) |
Income (Loss) Per Share (Tables
Income (Loss) Per Share (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Income/(Loss) Per Share | |
Schedule of basic and diluted income per share | The calculations of basic and diluted income per share attributable to the parent company for the three months ended March 31, 2022 and 2021, were as follows (figures are in thousands of USD, except share and per share amounts): Three Months Ended March 31, 2022 2021 Numerator: Net (loss)/income attributable to the parent company’s common shareholders - Basic and Diluted $ (59) $ 3,206 Denominator: Weighted average shares outstanding 30,851,776 30,851,776 Dilutive effects of stock options — 5,960 Denominator for dilutive income per share - Diluted 30,851,776 30,857,736 Net (loss)/income per share attributable to parent company’s common shareholders - Basic $ (0.00) $ 0.10 Net (loss)/income per share attributable to parent company’s common shareholders - Diluted $ (0.00) $ 0.10 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Related party transactions and balances | |
Schedule of related party transactions | Related party transactions are as follows (figures are in thousands of USD): Related party sales Three Months Ended March 31, 2022 2021 Merchandise sold to related parties $ 11,004 $ 16,575 Materials and others sold to related parties 605 426 Rental income obtained from related parties 125 106 Total $ 11,734 $ 17,107 Related party purchases Three Months Ended March 31, 2022 2021 Materials purchased from related parties $ 7,540 $ 8,214 Equipment purchased from related parties 449 225 Others purchased from related parties 157 10 Total $ 8,146 $ 8,449 Related party investment transaction Three Months Ended March 31, 2022 2021 Equity interest purchase from related parties $ 24,452 $ — Related party receivables March 31, 2022 December 31, 2021 Accounts and notes receivable, net from related parties $ 11,362 $ 14,607 Related party advance payments March 31, 2022 December 31, 2021 Advance payments for property, plant and equipment to related parties $ 1,159 $ 810 Advance payments and others to related parties 1,520 600 Total $ 2,679 $ 1,410 Related party payables March 31, 2022 December 31, 2021 Accounts and notes payable $ 11,784 $ 13,464 Accrued expenses and other payables to related parties 10,905 — Total 22,689 13,464 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies | |
Schedule of major commitments and contingencies | In addition to the bank loans, notes payables and the related interest, the following table summarizes the Company’s major commitments and contingencies as of March 31, 2022 (figures are in thousands of USD): Payment obligations by period 2022 2023 2024 Thereafter Total Obligations for investment contracts (1) $ — $ 4,726 $ — $ — $ 4,726 Obligations for purchasing and service agreements 22,925 2,004 — — 24,929 Total $ 22,925 $ 6,730 $ — $ — $ 29,655 (1) In January 2022, Hubei Henglong entered into an agreement with other parties and committed to purchase 27.78% of the shares of Suzhou Qingshan for total consideration of RMB 60.0 million, equivalent to approximately $9.5 million. As of March 31, 2022, Hubei Henglong has paid RMB 30.0 million, equivalent to approximately $4.7 million, which was reported in long term investment using equity mehod. According to the agreement, the remaining consideration of RMB 30.0 million, equivalent to approximately $4.7 million, will be paid in 2023. |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Segment Reporting | |
Schedule of revenue by major customers by reporting segments | The Company’s product sector information for the three months ended March 31, 2022 and 2021, is as follows (figures are in thousands of USD): Net Product Sales Net (Loss)/Income Three Months Ended Three Months Ended March 31, March 31, 2022 2021 2022 2021 Henglong $ 62,003 $ 49,079 $ 1,199 $ 799 Jiulong 17,728 33,719 (2,434) 1,000 Shenyang 3,311 4,092 (60) 353 Wuhu 8,872 4,159 2 7 Hubei Henglong 32,943 35,458 (2,837) 666 Henglong KYB 29,807 18,206 569 165 Brazil Henglong 10,484 4,915 2,815 413 Other Entities 19,849 16,322 1,147 95 Total Segments 184,997 165,950 401 3,498 Corporate — — (235) (217) Eliminations (48,601) (35,609) (17) (50) Total $ 136,396 $ 130,341 $ 149 $ 3,231 |
Organization and business (Deta
Organization and business (Details) | Mar. 31, 2022 | Dec. 31, 2021 | Apr. 30, 2021 | Apr. 30, 2020 | Mar. 31, 2019 | Aug. 31, 2018 | May 31, 2017 | |||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | 15.84% | |||||||||
Shashi Jiulong Power Steering Gears Co., Ltd., "Jiulong" [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | [1] | 100.00% | 100.00% | |||||||
Jingzhou Henglong Automotive Parts Co., Ltd., "Henglong" [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | [2] | 100.00% | 100.00% | |||||||
Shenyang Jinbei Henglong Automotive Steering System Co., Ltd., "Shenyang" [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | [3] | 70.00% | 70.00% | |||||||
Wuhan Jielong Electric Power Steering Co., Ltd., "Jielong" [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | [4] | 85.00% | 85.00% | |||||||
Wuhu Henglong Automotive Steering System Co., Ltd., "Wuhu" [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | 100.00% | [5] | 100.00% | [5] | 22.67% | |||||
Hubei Henglong Automotive System Group Co., Ltd., "Hubei Henglong" [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | [6] | 100.00% | 100.00% | |||||||
Jingzhou Henglong Automotive Technology (Testing) Center, "Testing Center" [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | [7] | 100.00% | 100.00% | |||||||
Chongqing Henglong Hongyan Automotive System Co., Ltd [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | [8] | 70.00% | 70.00% | |||||||
CAAS Brazil's Imports and Trade In Automotive Parts Ltd., "Brazil Henglong" [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | [9] | 95.84% | 95.84% | |||||||
Wuhan Chuguanjie Automotive Science and Technology Ltd., "Wuhan Chuguanjie" [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | [10] | 85.00% | 85.00% | |||||||
Hubei Henglong Group Shanghai Automotive Electronics Research and Development Ltd., "Shanghai Henglong" [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | [11] | 100.00% | 100.00% | |||||||
Jingzhou Qingyan Intelligent Automotive Technology Research Institute Co., Ltd., "Jingzhou Qingyan" [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | [12] | 60.00% | 60.00% | |||||||
Hubei Henglong & KYB Automobile Electric Steering System Co., Ltd., "Henglong KYB" [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | 66.60% | [13] | 66.60% | [13] | 66.60% | |||||
Hyoseong (Wuhan) Motion Mechatronics System Co., Ltd., "Wuhan Hyoseong" [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | 51.00% | [14] | 51.00% | [14] | 51.00% | |||||
Wuhu Hongrun | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | [15] | 62.00% | 62.00% | |||||||
Changchun Hualong Automotive Technology Co Ltd Changchun Hualong [Member] | ||||||||||
Organization And Principal Activities [Line Items] | ||||||||||
Percentage Interest | 100.00% | [16] | 100.00% | [16] | 100.00% | |||||
[1] | Jiulong was established in 1993 and mainly engages in the production of integral power steering gears for heavy-duty vehicles. | |||||||||
[2] | Henglong was established in 1997 and mainly engages in the production of rack and pinion power steering gears for cars and light duty vehicles. | |||||||||
[3] | Shenyang was established in 2002 and focuses on power steering parts for light duty vehicles. | |||||||||
[4] | Jielong was established in 2006 and mainly engages in the production and sales of automotive steering columns. | |||||||||
[5] | Wuhu was established in 2006 and mainly engages in the production and sales of automobile steering systems. | |||||||||
[6] | On March 7, 2007, Genesis established Hubei Henglong, formerly known as Jingzhou Hengsheng Automotive System Co., Ltd., its wholly-owned subsidiary, to engage in the production and sales of automotive steering systems. On July 8, 2012, Hubei Henglong changed its name to Hubei Henglong Automotive System Group Co., Ltd. | |||||||||
[7] | In December 2009, Henglong, a subsidiary of Genesis, formed Testing Center, which mainly engages in the research and development of new products. | |||||||||
[8] | On February 21, 2012, Hubei Henglong and SAIC-IVECO Hongyan Company, “SAIC-IVECO,” established a Sino-foreign joint venture company, Chongqing Henglong, to design, develop and manufacture both hydraulic and electric power steering systems and parts. | |||||||||
[9] | On August 21, 2012, Brazil Henglong was established as a Sino-foreign joint venture company by Hubei Henglong and two Brazilian citizens, Ozias Gaia Da Silva and Ademir Dal’ Evedove. Brazil Henglong engages mainly in the import and sales of automotive parts in Brazil. In May 2017, the Company obtained an additional 15.84% equity interest in Brazil Henglong for nil consideration. The Company retained its controlling interest in Brazil Henglong and the acquisition of the non-controlling interest was accounted for as an equity transaction. | |||||||||
[10] | In May 2014, together with Hubei Wanlong, Jielong formed a subsidiary, Wuhan Chuguanjie Automotive Science and Technology Ltd., “Wuhan Chuguanjie”, which mainly engages in research and development, manufacture and sales of automobile electronic systems and parts. Wuhan Chuguanjie is located in Wuhan, China. | |||||||||
[11] | In January 2015, Hubei Henglong formed Hubei Henglong Group Shanghai Automotive Electronics Research and Development Ltd., “Shanghai Henglong”, which mainly engages in the design and sales of automotive electronics. | |||||||||
[12] | In November 2017, Hubei Henglong formed Jingzhou Qingyan Intelligent Automotive Technology Research Institute Co., Ltd., “Jingzhou Qingyan”, which mainly engages in the research and development of intelligent automotive technology. | |||||||||
[13] | In August 2018, Hubei Henglong and KYB (China) Investment Co., Ltd. (“KYB”) established Hubei Henglong KYB Automobile Electric Steering System Co., Ltd., “Henglong KYB”, which mainly engages in design, manufacture, sales and after-sales service of automobile electronic systems. Hubei Henglong owns 66.6% of the shares of this entity and has consolidated it since its establishment. | |||||||||
[14] | In March 2019, Hubei Henglong and Hyoseong Electric Co., Ltd. established Hyoseong (Wuhan) Motion Mechatronics System Co., Ltd., “Wuhan Hyoseong”, which mainly engages in the design, manufacture and sales of automotive motors and electromechanical integrated systems. Hubei Henglong owns 51.0% of the shares of Wuhan Hyoseong and has consolidated it since its establishment. | |||||||||
[15] | In December 2019, Hubei Henglong formed Wuhu Hongrun New Material Co., Ltd., “Wuhu Hongrun”, which mainly engages in the development, manufacturing and sale of high polymer materials. Hubei Henglong owns 62.0% of the shares of Wuhu Hongrun and has consolidated it since its establishment. | |||||||||
[16] | In April 2020, Hubei Henglong acquired 100.0% of the equity interests of Changchun Hualong Automotive Technology Co., Ltd., “Changchun Hualong”, for total consideration of RMB 1.2 million, equivalent to approximately $0.2 million from an entity controlled by Hanlin Chen. Before the acquisition, 52.1% of the shares of Changchun Hualong were ultimately owned by Hanlin Chen and 47.9% of the shares were owned by third parties. Changchun Hualong mainly engages in design and R&D of automotive parts . |
Organization and business - Add
Organization and business - Additional Information (Details) $ in Thousands, ¥ in Millions | 1 Months Ended | |||||||||||
Apr. 30, 2021CNY (¥) | Apr. 30, 2021USD ($) | Apr. 30, 2020CNY (¥) | Apr. 30, 2020USD ($) | May 31, 2017USD ($) | Mar. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2019 | Mar. 31, 2019 | Aug. 31, 2018 | |||
Organization And Principal Activities [Line Items] | ||||||||||||
Equity method investment, ownership percentage | 15.84% | |||||||||||
Wuhu Henglong Automotive Steering System Co., Ltd., "Wuhu" [Member] | ||||||||||||
Organization And Principal Activities [Line Items] | ||||||||||||
Equity method investment, ownership percentage | 22.67% | 22.67% | 100.00% | [1] | 100.00% | [1] | ||||||
Consideration for additional equity interest acquired | ¥ 6.9 | $ 1,100 | ||||||||||
Hubei Henglong & KYB Automobile Electric Steering System Co., Ltd., "Henglong KYB" [Member] | ||||||||||||
Organization And Principal Activities [Line Items] | ||||||||||||
Equity method investment, ownership percentage | 66.60% | [2] | 66.60% | [2] | 66.60% | |||||||
Hyoseong (Wuhan) Motion Mechatronics System Co., Ltd., "Wuhan Hyoseong" [Member] | ||||||||||||
Organization And Principal Activities [Line Items] | ||||||||||||
Equity method investment, ownership percentage | 51.00% | [3] | 51.00% | [3] | 51.00% | |||||||
Changchun Hualong Automotive Technology Co Ltd Changchun Hualong [Member] | ||||||||||||
Organization And Principal Activities [Line Items] | ||||||||||||
Equity method investment, ownership percentage | 100.00% | 100.00% | 100.00% | [4] | 100.00% | [4] | ||||||
Consideration for additional equity interest acquired | ¥ 1.2 | $ 200 | ||||||||||
Hubei Henglong formed Wuhu Hongrun New Material Co., Ltd "Wuhu Hongrun" [Member] | ||||||||||||
Organization And Principal Activities [Line Items] | ||||||||||||
Equity method investment, ownership percentage | 62.00% | |||||||||||
Brazil Henglong | ||||||||||||
Organization And Principal Activities [Line Items] | ||||||||||||
Consideration for additional equity interest acquired | $ 0 | |||||||||||
Hanlin Chen [Member] | ||||||||||||
Organization And Principal Activities [Line Items] | ||||||||||||
Equity method investment, ownership percentage | 52.10% | 52.10% | ||||||||||
Third Party [Member] | ||||||||||||
Organization And Principal Activities [Line Items] | ||||||||||||
Equity method investment, ownership percentage | 47.90% | 47.90% | ||||||||||
[1] | Wuhu was established in 2006 and mainly engages in the production and sales of automobile steering systems. | |||||||||||
[2] | In August 2018, Hubei Henglong and KYB (China) Investment Co., Ltd. (“KYB”) established Hubei Henglong KYB Automobile Electric Steering System Co., Ltd., “Henglong KYB”, which mainly engages in design, manufacture, sales and after-sales service of automobile electronic systems. Hubei Henglong owns 66.6% of the shares of this entity and has consolidated it since its establishment. | |||||||||||
[3] | In March 2019, Hubei Henglong and Hyoseong Electric Co., Ltd. established Hyoseong (Wuhan) Motion Mechatronics System Co., Ltd., “Wuhan Hyoseong”, which mainly engages in the design, manufacture and sales of automotive motors and electromechanical integrated systems. Hubei Henglong owns 51.0% of the shares of Wuhan Hyoseong and has consolidated it since its establishment. | |||||||||||
[4] | In April 2020, Hubei Henglong acquired 100.0% of the equity interests of Changchun Hualong Automotive Technology Co., Ltd., “Changchun Hualong”, for total consideration of RMB 1.2 million, equivalent to approximately $0.2 million from an entity controlled by Hanlin Chen. Before the acquisition, 52.1% of the shares of Changchun Hualong were ultimately owned by Hanlin Chen and 47.9% of the shares were owned by third parties. Changchun Hualong mainly engages in design and R&D of automotive parts . |
Accounts and notes receivable_3
Accounts and notes receivable, net - Advance Payments (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Accounts and notes receivable, net | ||
Accounts receivable - unrelated parties | $ 151,245 | $ 146,362 |
Notes receivable - unrelated parties | 72,643 | 61,328 |
Total accounts and notes receivable - unrelated parties | 223,888 | 207,690 |
Less: allowance for doubtful accounts - unrelated parties | (12,853) | (11,961) |
Accounts and notes receivable, net - unrelated parties | 211,035 | 195,729 |
Accounts and notes receivable, net from related parties | 12,256 | 15,505 |
Less: allowance for doubtful accounts - related parties | (894) | (898) |
Accounts and notes receivable, net - related parties | 11,362 | 14,607 |
Accounts and notes receivable, net | $ 222,397 | $ 210,336 |
Accounts and notes receivable_4
Accounts and notes receivable, net - Additional Information (Details) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022USD ($)customer | Mar. 31, 2021USD ($)customer | Dec. 31, 2021USD ($) | |
Financing Receivables [Line Items] | |||
Notes receivable pledged as collateral | $ 19.7 | $ 18.2 | |
Allowance for accounts and notes receivable | $ 0.1 | $ 0.2 | |
Accounts receivable | Credit concentration risk | Five largest customers | |||
Financing Receivables [Line Items] | |||
Concentration risk (as a percent) | 8.70% | 8.80% | |
Revenue | Product Concentration Risk | Customer One | |||
Financing Receivables [Line Items] | |||
Concentration risk (as a percent) | 22.10% | 20.90% | |
Revenue | Product Concentration Risk | Five largest customers | |||
Financing Receivables [Line Items] | |||
Concentration risk (as a percent) | 46.70% | 43.30% | |
Number of customers | customer | 5 | 5 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Inventories | ||
Raw materials | $ 36,215 | $ 33,583 |
Work in process | 10,114 | 9,415 |
Finished goods | 68,154 | 73,495 |
Total | $ 114,483 | $ 116,493 |
Inventories - Additional Inform
Inventories - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Inventories | ||
Valuation Allowances and Reserves, Adjustments | $ 1 | $ 1 |
Long-term Investments (Details)
Long-term Investments (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Long-term investments | $ 60,660 | $ 36,966 |
Sentient AB | ||
Debt Instrument [Line Items] | ||
Long-term investments | 24,452 | |
Chongqing Venture Fund | ||
Debt Instrument [Line Items] | ||
Long-term investments | 15,085 | 17,530 |
Hubei Venture Fund | ||
Debt Instrument [Line Items] | ||
Long-term investments | 8,333 | 9,665 |
Suzhou Venture Fund | ||
Debt Instrument [Line Items] | ||
Long-term investments | 5,634 | 7,413 |
Suzhou Qingshan | ||
Debt Instrument [Line Items] | ||
Long-term investments | 4,727 | |
Henglong Tianyu | ||
Debt Instrument [Line Items] | ||
Long-term investments | 891 | 913 |
Chongqing Jinghua | ||
Debt Instrument [Line Items] | ||
Long-term investments | 578 | 642 |
Jiangsu Intelligent | ||
Debt Instrument [Line Items] | ||
Long-term investments | $ 960 | $ 803 |
Long-term Investments - Summari
Long-term Investments - Summarizes of Condensed Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Debt Instrument [Line Items] | ||
Revenue | $ 136,396 | $ 130,341 |
Gross profit | 14,734 | 19,748 |
Net (loss) | (59) | 3,206 |
Equity Method Investments | ||
Debt Instrument [Line Items] | ||
(Loss) from continuing operations | (20,578) | (9,093) |
Net (loss) | $ (20,578) | $ (9,093) |
Long-term Investments - Additio
Long-term Investments - Additional Information (Details) ¥ in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | ||||||
Feb. 28, 2022USD ($) | Jan. 31, 2022USD ($) | Jun. 30, 2021CNY (¥) | Jun. 30, 2021USD ($) | Mar. 31, 2022CNY (¥)director | Mar. 31, 2022USD ($)director | Mar. 31, 2022USD ($) | May 31, 2017 | |
Debt Instrument [Line Items] | ||||||||
Equity method investment, ownership percentage | 15.84% | |||||||
Sentient AB | ||||||||
Debt Instrument [Line Items] | ||||||||
Equity method investment, ownership percentage | 40.00% | 40.00% | ||||||
Chongqing Venture Fund | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from Partnership Contribution | $ 0.6 | $ 0.6 | ||||||
Hubei Venture Fund | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from Partnership Contribution | $ 1.2 | |||||||
Hubei Henglong | ||||||||
Debt Instrument [Line Items] | ||||||||
Equity method investment, ownership percentage | 200.00% | 200.00% | ||||||
Capital | ¥ 86 | $ 13.6 | ||||||
Number of board of directors | director | 2 | 2 | ||||||
Total consideration | ¥ 155.2 | $ 24.5 | ||||||
Remaining consideration | ¥ 69.2 | $ 10.9 | ||||||
Suzhou Venture Fund | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from Partnership Contribution | $ 0.9 | |||||||
Suzhou Qingshan | ||||||||
Debt Instrument [Line Items] | ||||||||
Equity method investment, ownership percentage | 27.78% | 27.78% | ||||||
Capital | ¥ 30 | $ 4.7 |
Property, plant and equipment_3
Property, plant and equipment, net (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Total amount of property, plant and equipment | $ 345,216 | $ 341,390 |
Less: Accumulated depreciation | (221,780) | (213,669) |
Total amount of property, plant and equipment, net | 123,436 | 127,721 |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Total amount of property, plant and equipment | 71,798 | 69,554 |
Machinery and Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total amount of property, plant and equipment | 256,334 | 253,245 |
Electronic equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total amount of property, plant and equipment | 6,997 | 6,887 |
Motor vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Total amount of property, plant and equipment | 5,108 | 5,121 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Total amount of property, plant and equipment | $ 4,979 | $ 6,583 |
Property, plant and equipment_4
Property, plant and equipment, net - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Property, plant and equipment, net | |||
Depreciation | $ 5,900 | $ 6,400 | |
Pledged property, plant and equipment with net book value | 9,500 | $ 54,700 | |
Interest costs capitalized | $ 50 | $ 160 |
Loans (Details)
Loans (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | |
China Construction Bank [Member] | |||
Debt Instrument [Line Items] | |||
Short-term bank loans | [1] | $ 48,185 | $ 47,592 |
[1] | The Company entered into credit facility agreements with various banks, which were secured by property, plant and equipment and land use rights of the Company. The total credit facility amount was $123.3 million and $116.8 million, respectively, as of March 31, 2022 and December 31, 2021. As of March 31, 2022, and December 31, 2021, the Company has drawn down loans with an aggregate amount of $48.2 million and $47.6 million, respectively. The weighted average interest rate was 3.3% and 3.5% , respectively. |
Loans - Additional Information
Loans - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Dec. 31, 2021 | |
Loans | ||
Maximum borrowing capacity | $ 123.3 | $ 116.8 |
Proceeds from lines of credit | $ 48.2 | $ 47.6 |
Weighted average interest rate | 3.30% | 3.50% |
Accounts and notes payable (Det
Accounts and notes payable (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Accounts and notes payable | ||
Accounts payable - unrelated parties | $ 132,199 | $ 132,593 |
Notes payable - unrelated parties | 83,693 | 81,997 |
Accounts and notes payable - unrelated parties | 215,892 | 214,590 |
Accounts and notes payable-related parties | 11,784 | 13,464 |
Total | 227,676 | 228,054 |
Cash pledged as collateral | 30,000 | 27,800 |
Notes receivable pledged as collateral | 19,700 | 18,200 |
Land use right pledged as collateral | $ 21,300 | $ 33,600 |
Accrued expenses and other pa_3
Accrued expenses and other payables (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Accrued expenses and other payables | ||
Warranty reserves | $ 37,128 | $ 36,572 |
Payable for the investment in Sentient AB (See Note 5) | 10,905 | |
Accrued expenses | 6,697 | 5,596 |
Current portion of other long-term payable (See Note 10) | 0 | 1,115 |
Payables for overseas transportation and custom clearance | 1,731 | 4,548 |
Dividends payable to holders of non-controlling interests | 473 | 471 |
Accrued interest | 257 | 507 |
Other payables | 1,149 | 1,523 |
Balance at end of year | $ 58,340 | $ 50,332 |
Accrued expenses and other pa_4
Accrued expenses and other payables - Warranty (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Accrued expenses and other payables | ||
Balance at beginning of the period | $ 36,572 | $ 36,215 |
Additions during the period | 3,888 | 3,681 |
Settlement within the period | (3,476) | (3,645) |
Foreign currency translation loss/(gain) | 144 | (266) |
Balance at end of the period | $ 37,128 | $ 35,985 |
Other long-term payable (Detail
Other long-term payable (Details) $ in Thousands, ¥ in Millions | 3 Months Ended | |||||
Mar. 31, 2022USD ($) | Mar. 31, 2022CNY (¥) | Mar. 31, 2021USD ($) | Mar. 31, 2022CNY (¥) | Dec. 31, 2021USD ($) | Jan. 31, 2018 | |
Term of Contract | 4 years | |||||
Payments to Acquire Property, Plant, and Equipment | $ 1,024 | $ 3,267 | ||||
Cash | 15,800 | ¥ 100 | ||||
Sale leaseback transaction, quarterly rental payments | 1,100 | |||||
Other payables | 1,149 | $ 1,523 | ||||
Capital Lease Obligations [Member] | ||||||
Payments to Acquire Property, Plant, and Equipment | $ 14,400 | ¥ 91.3 |
Redeemable non-controlling in_2
Redeemable non-controlling interests (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | |
Sep. 30, 2020 | Mar. 31, 2022 | Mar. 31, 2021 | |
Redeemable Noncontrolling Interest [Line Items] | |||
Percentage of interest, redemption price | 6.00% | ||
Accretion of temporary equity redemption value | $ 500 | ||
Accretion of redeemable non-controlling interests | $ (8) | $ (7) | |
Hubei Venture Fund | |||
Redeemable Noncontrolling Interest [Line Items] | |||
Issuance of shares by a subsidiary | $ 700 |
Additional paid-in capital (Det
Additional paid-in capital (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Additional paid-in capital | ||
Balance at beginning of the period | $ 63,731 | |
Share-based compensation | 0 | $ (88) |
Balance at end of the period | $ 63,731 | $ 64,361 |
Retained Earnings (Details)
Retained Earnings (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Retained Earnings | ||
Statutory Accounting Practices Statutory Surplus Required Percentage | 10.00% | |
Percentage Of Statutory Surplus Reserve | 50.00% | |
Statutory Accounting Practices, Statutory Capital and Surplus Required | $ 0 | |
Statutory Accounting Practices Statutory Capital And Surplus Reserve | $ 0 | $ 0 |
Retained earnings - Appropriate
Retained earnings - Appropriated (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 | Mar. 31, 2021 |
Retained Earnings | |||
Balance at beginning of the period | $ 11,481 | $ 11,303 | $ 11,303 |
Balance at end of the period | $ 11,481 | $ 11,481 | $ 11,303 |
Retained earnings - Unappropria
Retained earnings - Unappropriated (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Retained Earnings | ||
Balance at beginning of the period | $ 226,363 | $ 215,491 |
Net (loss)/income attributable to parent company | (51) | 3,213 |
Accretion of redeemable non-controlling interests | (8) | (7) |
Balance at end of the period | $ 226,304 | $ 218,697 |
Accumulated other comprehensi_3
Accumulated other comprehensive income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Accumulated other comprehensive income | ||
Balance at beginning of the period | $ 24,717 | $ 17,413 |
Foreign currency translation adjustment attributable to parent company | 1,348 | (2,128) |
Balance at end of the period | $ 26,065 | $ 15,285 |
Treasury Stock (Details)
Treasury Stock (Details) - USD ($) $ / shares in Units, $ in Millions | Mar. 29, 2022 | Mar. 31, 2022 | Aug. 12, 2021 |
Equity, Class of Treasury Stock [Line Items] | |||
Stock repurchased during period | 0 | ||
Maximum [Member] | |||
Equity, Class of Treasury Stock [Line Items] | |||
Stock repurchased during period, value | $ 5 | ||
Share price per share through March 30, 2023 | $ 4 |
Non-controlling interests (Deta
Non-controlling interests (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Non-controlling interests | ||
Balance at beginning of the period | $ 15,854 | $ 16,170 |
Net income attributable to non-controlling interests | 200 | 18 |
Foreign currency translation adjustment attributable to non-controlling interests | 89 | (143) |
Balance at end of the period | $ 16,143 | $ 16,045 |
Net product sales (Details)
Net product sales (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Contract with Customer, Liability, Current | $ 3.7 | $ 2.4 | |
Revenue from Contract with Customer, Including Assessed Tax | 2.3 | $ 1 | |
Revenue | |||
Contract with Customer, Liability, Current | 1 | 1.4 | |
Revenue from Contract with Customer, Including Assessed Tax | $ 1 | $ 1.4 |
Financial income(expense), ne_2
Financial income(expense), net (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Financial income/(expense), net | ||
Interest income | $ 251 | $ 313 |
Foreign exchange gain/(loss), net | 1,910 | (469) |
Bank charges | (146) | (83) |
Total financial income/(expense), net | $ 2,015 | $ (239) |
Income (Loss) Per Share (Detail
Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Numerator: | ||
Net income/(loss) attributable to parent company | $ (59) | $ 3,206 |
Denominator: | ||
Weighted average shares outstanding | 30,851,776 | 30,851,776 |
Dilutive effects of stock options | 0 | 5,960 |
Denominator for dilutive income per share - Diluted | 30,851,776 | 30,857,736 |
Net income/(loss) per share attributable to parent company's common shareholders | ||
Net (loss)/income per share attributable to parent company's common shareholders - Basic | $ 0 | $ 0.10 |
Net (loss)/income per share attributable to parent company's common shareholders - Diluted | $ 0 | $ 0.10 |
Income (Loss) Per Share - Addit
Income (Loss) Per Share - Additional Information (Details) - shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Equity Option [Member] | ||
Earnings Per Share, Basic and Diluted [Line Items] | ||
Ordinary shares excluded from the computation of diluted net loss per ordinary share | 30,000 | |
Share options - weighted average | ||
Earnings Per Share, Basic and Diluted [Line Items] | ||
Ordinary shares excluded from the computation of diluted net loss per ordinary share | 954 |
Significant Concentrations (Det
Significant Concentrations (Details) | 3 Months Ended |
Mar. 31, 2022 | |
Significant Concentrations | |
Minimum Percentage Of Profit Allocated To Foreign Investment | 10.00% |
Registered Capital Percentage | 50.00% |
Related party transactions an_2
Related party transactions and balances (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Related Party Revenue | |||
Revenue from Related Parties | $ 11,004 | $ 16,575 | |
Related sales | |||
Merchandise sold to related parties | 11,004 | 16,575 | |
Related party investment transaction | |||
Equity interest purchase from related parties | 24,452 | ||
Related receivables | |||
Accounts and notes receivable, net - related parties | 11,362 | $ 14,607 | |
Related advance payments | |||
Advance payments for property, plant and equipment - related parties | 1,159 | 810 | |
Advanced payments and others to related parties | 1,520 | 600 | |
Total | 2,679 | 1,410 | |
Related payables | |||
Accounts and notes payable | 11,784 | 13,464 | |
Accrued expenses and other payables to related parties | 10,905 | ||
Total | 22,689 | $ 13,464 | |
Raw Materials [Member] | |||
Related purchases | |||
Related party purchases | 7,540 | 8,214 | |
Related Party [Member] | |||
Related sales | |||
Merchandise sold to related parties | 11,734 | 17,107 | |
Related purchases | |||
Related party purchases | 8,146 | 8,449 | |
Related Party [Member] | Raw Materials [Member] | |||
Related sales | |||
Merchandise sold to related parties | 605 | 426 | |
Related Party [Member] | Rental Income [Member] | |||
Related sales | |||
Merchandise sold to related parties | 125 | 106 | |
Equipment [Member] | Related Party [Member] | |||
Related purchases | |||
Related party purchases | 449 | 225 | |
Other Purchased [Member] | Related Party [Member] | |||
Related purchases | |||
Related party purchases | $ 157 | $ 10 |
Related party transactions an_3
Related party transactions and balances - Additional Information (Details) | May 23, 2022 | May 31, 2017 |
Related Party Transaction [Line Items] | ||
Equity method investment, ownership percentage | 15.84% | |
Subsequent Event [Member] | ||
Related Party Transaction [Line Items] | ||
Equity method investment, ownership percentage | 57.90% |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | Mar. 31, 2022USD ($) | |
Commitments and Contingencies Disclosure [Line Items] | ||
2022 | $ 22,925 | |
2023 | 6,730 | |
Total | 29,655 | |
Obligations for investment contracts [Member] | ||
Commitments and Contingencies Disclosure [Line Items] | ||
2023 | 4,726 | [1] |
Total | 4,726 | [1] |
Obligations for purchasing and service agreements | ||
Commitments and Contingencies Disclosure [Line Items] | ||
2022 | 22,925 | |
2023 | 2,004 | |
Total | $ 24,929 | |
[1] | In January 2022, Hubei Henglong entered into an agreement with other parties and committed to purchase 27.78% of the shares of Suzhou Qingshan for total consideration of RMB 60.0 million, equivalent to approximately $9.5 million. As of March 31, 2022, Hubei Henglong has paid RMB 30.0 million, equivalent to approximately $4.7 million, which was reported in long term investment using equity mehod. According to the agreement, the remaining consideration of RMB 30.0 million, equivalent to approximately $4.7 million, will be paid in 2023. |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) ¥ in Millions, $ in Millions | 1 Months Ended | ||||
Jan. 31, 2022CNY (¥) | Jan. 31, 2022USD ($) | Mar. 31, 2022CNY (¥) | Mar. 31, 2022USD ($) | May 31, 2017 | |
Commitments and Contingencies Disclosure [Line Items] | |||||
Equity method investment, ownership percentage | 15.84% | ||||
Suzhou Qingshan | Hubei Henglong | |||||
Commitments and Contingencies Disclosure [Line Items] | |||||
Payments to Acquire Equity Method Investments | ¥ 60 | $ 9.5 | |||
Equity method investment, ownership percentage | 27.78% | 27.78% | |||
Equity Method Investments | ¥ 30 | $ 4.7 | |||
Remaining Capital Commitment | ¥ | ¥ 30 | ||||
Remaining Capital Commitment Paid In 2023 | $ | $ 4.7 |
Segment Reporting (Details)
Segment Reporting (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | |||
Total | $ 136,396 | $ 130,341 | |
Net Income/(Loss) | 149 | 3,231 | |
Depreciation and Amortization | 6,207 | 6,544 | |
Assets | 726,647 | $ 716,762 | |
Eliminations | |||
Segment Reporting Information [Line Items] | |||
Total | (48,601) | (35,609) | |
Net Income/(Loss) | (17) | (50) | |
Corporate | |||
Segment Reporting Information [Line Items] | |||
Total | 0 | 0 | |
Net Income/(Loss) | (235) | (217) | |
Jingzhou Henglong Automotive Parts Co., Ltd., "Henglong" [Member] | |||
Segment Reporting Information [Line Items] | |||
Total | 62,003 | 49,079 | |
Net Income/(Loss) | 1,199 | 799 | |
Shashi Jiulong Power Steering Gears Co., Ltd., "Jiulong" [Member] | |||
Segment Reporting Information [Line Items] | |||
Total | 17,728 | 33,719 | |
Net Income/(Loss) | (2,434) | 1,000 | |
Shenyang Jinbei Henglong Automotive Steering System Co., Ltd., "Shenyang" [Member] | |||
Segment Reporting Information [Line Items] | |||
Total | 3,311 | 4,092 | |
Net Income/(Loss) | (60) | 353 | |
Wuhu Henglong Automotive Steering System Co., Ltd., "Wuhu" [Member] | |||
Segment Reporting Information [Line Items] | |||
Total | 8,872 | 4,159 | |
Net Income/(Loss) | 2 | 7 | |
Hubei Henglong | |||
Segment Reporting Information [Line Items] | |||
Total | 32,943 | 35,458 | |
Net Income/(Loss) | (2,837) | 666 | |
Henglong KYB | |||
Segment Reporting Information [Line Items] | |||
Total | 29,807 | 18,206 | |
Net Income/(Loss) | 569 | 165 | |
Brazil Henglong | |||
Segment Reporting Information [Line Items] | |||
Total | 10,484 | 4,915 | |
Net Income/(Loss) | 2,815 | 413 | |
Other Entities | |||
Segment Reporting Information [Line Items] | |||
Total | 19,849 | 16,322 | |
Net Income/(Loss) | 1,147 | 95 | |
Total Segments | |||
Segment Reporting Information [Line Items] | |||
Total | 184,997 | 165,950 | |
Net Income/(Loss) | $ 401 | $ 3,498 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Details) | Mar. 31, 2022itemproduct | Mar. 31, 2021productitem |
Segment Reporting | ||
Number of product sectors | product | 15 | 15 |
Number of principal profit makers | 7 | 7 |
Number of holding company | 1 | 1 |
Number of sectors engaged in production and sale of products | 8 |