CYD

Good day, and thank you for standing by. Welcome to China Yuchai International Limited Second Half 2025 Financial Results. [Operator Instructions] Please be advised that today's conference call is being recorded. I would now like to turn the conference over to Kevin Theiss. Please go ahead, sir.

Thank you for joining us today, and welcome to China Yuchai International Limited Conference Call and Webcast for the 2025 Second half and year ended on December 31, 2025. Joining us today are Mr. Weng Ming Hoh and Mr. Choon Sen Loo, President and Chief Financial Officer of CYI, respectively. In addition, we have in attendance, Mr. [ Kelvin Lai ], General Manager of Operations of CYI and the Chairman of MTU Yuchai Power Company Limited, MTU Yuchai Power. Before we begin, I will remind all listeners that throughout this call, we may make statements that may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words believe, expect, anticipate, project, targets, optimistic, confident that, continue to, predict, intend, aim, will or similar expressions are intended to identify forward-looking statements. All statements other than statements of historical fact are statements that may be deemed forward-looking statements. These forward-looking statements include, but are not limited to, statements concerning the company's operations and its financial performance and condition and are based on current expectations, beliefs and assumptions, which are subject to change at any time. The company cautions that these statements, by their nature, involve risks and uncertainties, and actual results may differ materially depending on a variety of important factors such as government and stock exchange regulations, competition, political, economic and social conditions around the world and in China, including those discussed in the company's Form 20-F and under the headings Risk Factors, Results of Operations and Business Overview and in other reports filed with the Securities and Exchange Commission from time to time. All forward-looking statements are applicable only as of the date they are made, and the company specifically disclaims any obligation to maintain or update the forward-looking information, whether of the nature contained in the press release made today or today's conference call or otherwise in the future. Mr. Hoh will provide a brief overview and summary, and then Mr. Loo will review the financial results for the second half and fiscal year ended December 31, 2025. Thereafter, we will conduct a question-and-answer session. For the purposes of today's call, the 2025 second half and fiscal year numbers are unaudited. The 2024 second half year are unaudited and the 2024 fiscal year financial results are audited. Financial results are presented in RMB and U.S. dollars. All the financial information presented is reported using the IFRS accounting standards as issued by the International Accounting Standards Board. With that, Mr. Hoh, please begin your prepared remarks.

Thank you, Kevin. We are pleased to report a strong sales and profit growth in the second half and full year of 2025. For second half 2025, our revenue in the second half increased by 33.5% year-over-year to RMB 1.8 billion or USD 1.7 billion. Our gross profit increased by 58.4% year-over-year to RMB 2.2 billion or USD 317 million, and our gross margin rose to 18.9%. Our operating profit increased by 193.1% year-over-year to RMB 469.2 million or USD 66.7 million. Basic and diluted earnings per share improved by RMB 108.7 million year-over-year to RMB 4.57 or USD 0.65. For fiscal year of 2025, revenue increased by 28.9% to RMB 24.7 billion or USD 3.5 billion. Gross profit increased by 44.3% year-on-year to RMB 4.1 billion or USD 578.7 million and gross margin rose to 16.5%. Operating profit improved by 82.7% to RMB 1.1 billion or USD 155.2 million. Basic and diluted earnings per share increased by 34.4% to RMB 14.32 or USD 2.04. Our revenue growth in 2025 second half and year was generated by higher unit sales in nearly every reporting category. Gross profit and margin were enhanced by the increased unit sales volume, especially for heavy-duty and high-cost power engines. Our off-road engine unit sales in 2025 increased by 13% year-over-year with marine and genset engines and industrial engines each recording unit sales growth of over 24% year-over-year. The fast-growing demand for backup generators to provide reliable electric power for data center operations created rapid growth for our engines. Combined sales of MTU Yuchai Power and Yuchai branded high horsepower engines to data centers exceeded 2,000 units in 2025, up from 750 units in the prior year. To meet the expected increase in demand for our power generating engines, production capacity expansion is well underway. Exports were an important sales channel as our globalization has been increasing. Our agreement in Vietnam includes Yuchai support for construction of our partners' production facility, which complements our Thailand production operations. Buses powered by Yuchai natural gas engines were delivered in Mexico, bringing the total Yuchai engine count to 2,400 units powering buses in the Nuevo Leon region of Mexico. Our foundry began batch delivery of advanced casting to Germany, demonstrating the acceptance of our casting product quality by the customer. We are expanding our international sales and service support offices as we believe potential new international partnerships will strengthen our global reach. Our strategy remains to sell into multiple end markets with a growing and diverse product portfolio. R&D expenses increased by 37.3% to RMB 1.4 billion or USD 192.3 million in the fiscal year of 2025. Yuchai continued to enhance engine efficiency and performance of its National VI and Tier 4 emission compliant engines and power generation engines. Progress continued on developing new energy products, including alternative fuel engines using hydrogen, methanol and ammonia combustion technologies. Total R&D expenditure, including capitalized costs, was RMB 1.5 billion or USD 217.1 million. Our strategic alliances and joint ventures produced a 9.4% year-over-year growth in profit in 2025, propelled by higher sales and profit mainly by MTU Yuchai. Recently, we took proactive steps to strengthen our technological capabilities and supply chain resilience by improving access to key components and advancing our participation in critical technology development. We acquired a 27.97% equity interest in Nanyue Diankong (Hengyang) Industrial Technology Company, which is a national high-tech industrial leader specializing in fuel injection system, including common rail system, unit pump and mechanical parts. In addition, we became a limited partner in the Guangxi China Double Growth Fund, a private equity fund focused on investing in emerging and innovative technologies. Our indirect subsidiary, Guangxi Yuchai Marine and Genset Power Company filed an application for listing with the Hong Kong Stock Exchange in January 2026. The potential listing is subject to review and approval by the Hong Kong Stock Exchange and relevant regulatory authorities and market conditions. We believe this action will provide more resources to enhance their operations growth. Highlighting the company's confidence in future revenue, profits and cash flow generation, we paid a cash dividend of $0.53 per ordinary share in July 2025 to show our commitment to building shareholder value. Cash and bank balances were over RMB 7.9 billion or USD 1.1 billion as at December 31, 2025. With that, I'd now like to turn the call over to Mr. Sen Loo, our Chief Financial Officer, who will provide more details on the financial results. Choon Sen?

Thank you, Weng Ming. Now let me review our unaudited 6 months and full year results ended December 31, 2025. For the 6 months, our revenue increased by 33.5% to RMB 11.8 billion or USD 1.7 billion compared with RMB 8.8 billion in second half 2024. Total number of engines sold increased by 28.7% to 210,913 units compared with 163,843 units in second half 2024. The increase in the total number of engines sold in the second half 2025 was primarily driven by a 49.2% year-over-year rise in truck and bus engine unit sales, which significantly outpaced the 13% year-over-year growth in market shares of truck and bus vehicles, excluding [indiscernible] and electric powered vehicles as reported by the China Association of Automobile Manufacturers, CAAM. Truck engine unit sales in second half 2025 rose by 59.4%, led by a 146.1% year-over-year gain in heavy-duty truck engines. Off-road engine unit sales increased by 7.5% year-over-year, led by strong growth of more than 22% in both industrial and marine and genset unit sales, offsetting lower agricultural engine unit sales. Gross profit increased by 58.4% to RMB 2.2 billion or USD 317 million, up from RMB 1.4 billion in second half 2024. Gross margin increased to 18.9% in second half 2025 compared with 15.9% in second half 2024. The increase was mainly due to higher unit sales volume, a change of sales mix with higher unit sales of heavy-duty and high horsepower engines and continuing cost reduction initiatives. Other operating income decreased by 44.1% to RMB 224.5 million or USD 31.9 million compared with RMB 401.5 million in second half 2024. The decrease was mainly due to lower government grants. Research and development expenses increased by 48% to RMB 874.9 million or USD 124.5 million compared with RMB 591.1 million in second half 2024, mainly driven by higher experimental costs, increased personnel expenses, higher mold costs and impairments related to fuel cell development. Total R&D expenditures, including capitalized costs, were RMB 974.2 million or USD 138.6 million, representing 8.3% of the revenue in second half 2025 as compared with RMB 726 million or 8.2% of the revenue in second half 2024. Selling, general and administrative SG&A expenses increased by 4.9% to RMB 1.1 billion or USD 157.7 million from RMB 1 billion in second half 2024. This increase was mainly due to increased personnel expenses and higher consultancy fees, partially offset by lower accounts receivable provisions compared with the same period last year. SG&A expenses represented 9.4% of the revenue in second half 2025 compared with 12% for second half 2024. Operating profit rose by 193.1% to RMB 469.2 million or USD 66.7 million from RMB 160.1 million in second half 2024. Operating margin was 4% compared with 1.8% in second half 2024. The increase was generated by higher unit sales volume, a change of sales mix with higher unit sales of heavy-duty and high horsepower engines and lower SG&A expense as a percentage of the total revenue. Finance costs decreased by 20.2% to RMB 29.6 million or USD 4.2 million from RMB 37.1 million in second half 2024, primarily due to lower bank term loans and reduced bills discounting. The share of financial results of the associates and joint ventures decreased by 15.1% to RMB 49.7 million or USD 7.1 million compared with RMB 58.5 million in second half 2024. The decrease was mainly due to reduced profits at Y&C Engine Co., Limited. Income tax expense was RMB 213.5 million or USD 30.4 million compared with RMB 26.4 million in second half 2024. The tax increase was due to higher profits in second half 2025 as compared with second half 2024 and higher deferred tax expenses. Net profit attributable to equity holders of the company increased by 107.4% to RMB 171.6 million or USD 24.4 million compared with RMB 82.7 million in second half 2024. Basic and diluted earnings per share was RMB 4.57 or USD 0.65 compared with RMB 2.19 in second half 2024. Basic and diluted earnings per share for second half 2025 and second half 2024 were based on the weighted average of 37,518,322 shares and 37,809,824 shares, respectively. Now we will review the unaudited financial results for the fiscal year ended December 31, 2025. Revenue increased by 20.9% to RMB 24.7 billion or USD 3.5 billion compared with RMB 19.1 billion in FY '24. The total number of engines sold in FY 2025 increased by 29.4% year-over-year to 461,309 units compared with 356,586 units in FY 2024. Truck and bus engine units rose by 42.8% compared with CAAM data for vehicle market sales growth, excluding gasoline and electric powered vehicles of 4.5% for 2025. Total truck engine unit sales rose by 50.7% year-over-year compared with a 5.9% year-over-year increase from CAAM data for truck unit sales. Heavy-duty truck engine sales increased by 80.1% year-over-year in 2025, followed by a 34.2% year-over-year increase in medium-duty truck engines and a 67.6% year-over-year improvement in light-duty truck engine sales. Off-road engine unit sales increased by 13% year-over-year with both industrial and marine and genset unit sales growth of more than 24% year-over-year, offsetting lower agricultural engine unit sales. Gross profit increased by 44.3% to RMB 4.1 billion or USD 578.7 million from RMB 2.8 billion in FY 2024. Gross margin increased to 16.5% compared with 14.7% in FY 2024. The increase was mainly due to higher unit sales volume, a change of sales mix to higher unit sales of heavy-duty and high horse engine power -- high horsepower engines and continuing cost reduction initiatives. Other operating income decreased by 22.5% to RMB 445.9 million or USD 63.4 million compared with RMB 575.7 million in FY 2024. This was primarily due to lower bank interest income and reduced government grants. R&D expenses increased by 37.3% to RMB 1.4 billion or USD 192.3 million compared with RMB 984.7 million in FY 2024, primarily driven by higher experimental costs, increased personnel expenses and impairments related to fuel cell development. Yuchai had continued with its initiatives to enhance the engine efficiency and performance of its National VI and Tier 4 emission standard compliant engines and power generation engines for data centers and marine applications, while also advancing its new energy solutions. Total R&D expenditure, including capitalized cost was RMB 1.5 billion or USD 217.1 million, representing 6.2% of the revenue in FY 2025 compared with RMB 1.2 billion or 6.2% of the revenue in FY 2024. SG&A expenses increased by 14.3% to RMB 2.1 billion or USD 294.7 million, representing 8.4% of the revenue in FY 2025 compared with RMB 1.8 billion or 9.5% of the revenue in FY 2024. This was mainly due to higher personnel expenses and consultancy fees as well as increased sales and service expenses that partially offset lower accounts receivable provisions. Operating profit increased by 82.7% to RMB 1.1 billion or USD 155.2 million compared with RMB 597 million in FY 2024. The operating margin was 4.4%, up from 3.1% in FY 2024. Finance costs decreased by 20.8% to RMB 61.8 million or USD 8.8 million from RMB 78 million in FY 2024, primarily due to lower bank term loans. The share of financial results of the associates and joint ventures increased by 9.4% to income of RMB 111.1 million or USD 15.8 million compared with income of RMB 101.5 million in FY 2024. The improvement was mainly driven by higher profits of 18.8% at MTU Yuchai Power Company Limited and increased profits at Guangxi Purem Yuchai Automotive Technology Company partially offset lower profits at Y&C Engine Co., Ltd. Income tax expense increased by 106% to RMB 329.7 million or USD 46.9 million compared with RMB 128.8 million in FY 2024. The tax increase was driven by higher profit in FY 2025 as compared with 2024 and higher deferred tax expenses. Net profit attributable to the company's shareholders increased by 66.3% to RMB 537.4 million or USD 76.5 million compared with RMB 323.1 million in FY 2024. Basic and diluted earnings per share rose by 74.4% to RMB 14.32 or USD 2.04 compared with RMB 8.21 in FY 2024. Basic and diluted earnings per share for FY 2025 and FY 2024 were based on the weighted average of 37,518,322 shares and 39,335,753 shares, respectively. Now we'll go through some balance sheet highlights as of December 31, 2025. Cash and bank balances were RMB 7.9 billion or USD 1.1 billion compared with RMB 6.4 billion at the end of FY 2024. Trade and bills receivables were RMB 10.4 billion or USD 1.5 billion compared with RMB 8.8 billion at the end of FY 2024. Inventories were RMB 5.6 billion or USD 791.8 million compared with RMB 4.7 billion at the end of FY 2024. Trade and bills payables were RMB 11.1 billion or USD 1.6 billion compared with RMB 8.5 billion at the end of FY 2024. Short-term and long-term loans and borrowings were RMB 2 billion or USD 287.4 million compared with RMB 2.5 billion at the end of financial year 2024. I will now turn the call over to Kevin for a comment for Q&A section.

Thank you, Mr. Loo. Please note, some officers of China Yuchai are remotely calling into the conference call. This may result in a slight delay in providing answers to some questions. We apologize for any inconvenience, and thank you for your patience. If you would like to ask a question in Chinese, please kindly translate your own question to English before turning to the management for answers. And before we start the Q&A, we would also like to announce that management will be attending the forthcoming Jefferies Conference on March 19, the HSBC Conference on April 14 to the 16, Bank of America Merrill Lynch Conference in Shenzhen on May 13, JPMorgan Conference on May 20 to 22; and the UBS Conference in Hong Kong on May 26 to 29. If you are interested in a one-on-one or a small group meeting, please contact the salespeople at these banks. Given the tight meeting schedule and travel plans, we will not be able to accept meeting requests outside the conference venues. Now operator, we are ready for questions.

[Operator Instructions]

Operator, I've seen the questions online. Okay. So I'll read out the questions from [indiscernible].

So the question is that thanks for information and congrats on the strong results by year-over-year. Can you potentially share more on much higher expenses in second half where effective tax rate is about 44%.

Okay. I'm Choon Sen, CFO of CY. So I will take these questions. So I think this questions are tax expense, we should look at the full year, right? So from a full year basis, there's a 7% to 8% higher due to the deferred tax. So on a year-on-year basis, we were off about a net basis RMB 100 million. So that is actually noncash item. That is also due to the [indiscernible] of accounting that we look at the future profits for all entities. And eventually, then we need to impair those deferred tax assets that should be shown to be assessed. So we -- the company has started to write off those deferred tax assets and reduce it to the level of -- to sustain for the future profit. That's also part of the accounting requirements that we have done that. Yes. So if you exclude that, so we will come down to about 20% to 21% effective tax rate on a year-on-year basis. So the changes is probably only about 1% to 2% if you look at 2025 and 2024. Okay. I hope that answers your questions, [indiscernible].

We do have questions from the phone line. The first question comes from Wei Shen of UBS.

My question is about the other operating income. I found that in 2024, it decreased a lot. And I'm wondering what's the reasons and what's the outlook in 2026?

Okay. I'm Choon Sen here. So your question is on the vision [indiscernible]. The question is on operating other income, right? I just want to confirm your question.

Yes.

Okay. So the reduction is mainly due to the lower government grants. So in 2025, probably a lot of people on-call may know that they are quite tighten up the incentive policy issued by the Chinese government. So that has reduced substantially. It's actually half of the government grant that we have received in 2024 -- in 2025 compared to 2024. So is your question -- next question is that whether that will continue this trend, right? That one, again, we won't project that what will be the incentive from the government. But for now, I would think that the trend probably will remain as 2025.

Okay. My next question is about the share of the joint venture had a profit in 2025 because we only have the combined results, we don't have the details. Can -- do you have the numbers for the MTU joint venture? What's the profit growth for the joint venture?

Well, we'll let [ Kelvin Lai ] answer that he's the Chairman of MTU. He can tell you about it.

Okay. Thank you for the question. The joint venture last year and then they generate the net profit, it is about RMB 211 million. So they're increasing by 22% and then from the year 2024. But the sales volume and also the revenue is much higher, about 30% plus increase. The reason why the profit not as good as the volume sales or the revenue generated because of the product mix has been changed and we sold less the 20-cylinder engine and the profit and also the revenue is a little bit lower than the other version.

Our next question, we have the line from Fuyin Liang from Bank of America.

This is Fuyin from Bank of America. So I also have two questions for the management team. The first one is that in the second half in 2025, we see that the company's gross profit margin improved quite a lot year-over-year. So could you please elaborate more about the reasons behind? And is it because we have more delivery to the power generation clients so that we have a better product mix and hence, the higher gross margin? That's the first question.

Okay. Let me answer that question. Actually, if you look at the unit sales that we had disclosed in the announcement, the unit sales actually gone up by about 30%. So that's one of the major reasons why the profit improved is due to the increase in volume. And two, also because of our high horsepower engines, we sold more than we did last year. I mean, again, significantly more. If you look at our numbers gain in the announcement, gone up from 750 units to 2,000 units. So those are two major contributors to the improved performance. Of course, with the higher volume that we have, higher unit sales, that will kind of leverage the fixed cost that contributes to the better gross margin too.

Okay. So I have a follow-up question. So given the better product mix in 2025, so what's our guidance for 2026?

It's going to be quite challenging, difficult to provide a good guidance in China. In China, the sales, a lot of it is due to government policy -- is driven by government policies, right? So we haven't seen much yet. Last year, one of the biggest reasons for the increase in revenue or unit sales is because of the government policy, the replacement policy, Guo Sanqua. So that one has actually drove quite a fair bit of our vehicle sales and also quite a bit of our non-vehicle sales as well volume. So whether or not the government is going to continue with that and how strongly we're going to push that next year is yet to be seen, and that will determine the impact on the overall unit sales growth. But however, there is a what's called bright spot. We see a lot of big demand in the data centers last year, and that has maintained, and we expect it will improve this year, but it's hard to give you a percentage to the growth. So I think we expect that to improve by double digit this year for the data centers. So overall, I think this year's non-data center sales is going to be more or less the same if the government continues with the [indiscernible] policies last year.

So my second question is about our R&D expenses. So in 2025, we see that R&D expenses increased over 30%. So looking at 2026, what do you expect R&D expenses growth rate? And what's our key R&D focuses looking at 2026 and 2027?

Okay. R&D expenses has grown by around about 5% of our revenue, right? So if he goes [indiscernible] same type of revenue. The other one that we should talk about is that what type of research [indiscernible]? There are a few things that we're working on one of them is, of course, the new energy side of things. We are still developing and continue to develop on the new energy side, particularly in the range of standard EVs and to try to get our system, which is already commercialized to be set into or develop into our customers' vehicles. And other areas will be new -- kind of new areas -- new energy systems, things like ammonia, methanol and hydrogen power combustion engines other than fuel cells, right? So if you -- and also, the Chinese government is now also considering introducing National VII emission standards in the coming 2 to 3 years. So for that, we are also starting to do some R&D to get ourselves ready for that emissions requirement. So there are quite a few areas that we're working on in addition to continuous improvement on the product, to get more efficient and more fuel efficient as well. So there are quite a few areas working on.

Our next question comes from Ying Xu of CICC.

Congratulations. So I have two questions to ask. The first one is about the future business of the HPP engines. We noticed that Caterpillar has announced its reciprocating generators can be used as prime power for data centers. So how does [indiscernible] view this industry trend? And do we have some existing natural gas engine products and technologies to support these industry trend? This is my first question.

Kelvin, would you like to...

Yes. Let me take this question, yes. The high horsepower engine, the business forecast and then it still depends on the development of those Internet Service Provider and then how fast they build the data center. So we do expect there will be still a growth in the year 2026 when comparing to 2025, but we don't have the exact figure because -- and then so far, then we don't receive -- I mean, all the order and then from the wireless customer. Regarding on your question, regarding on the natural gas generator and then the -- from Yuchai, and then we do have our natural gas engine for the power generation. We have the technology and we have the right product as well. And our product, the natural gas engine will be very similar to the diesel engine. And then they had using our 16 VC engine and then that will be generated, I mean, about 2 megawatt for the power generation using natural gas. But so far and then the application of the natural gas for high horsepower is mainly on the industrial application at the moment because in the region of China or Asia and then -- I mean, the customer and then we were considering the cost of the engine and then they are not using the natural gas engine for the data center at this stage.

Very clear. So my second question is about our significant market share gain in truck and bus engines, especially in 2025. So how do you view the 2026 outlook for domestic truck and bus industry sales and whether market share growth can be sustainable? This is my second question.

Okay. So you're talking about vehicle engines, the major vehicle OEMs in the market, some of them are using our engines. In particular, I think we have been working with the vehicle OEMs for quite a while to get our engines certified and designed to their vehicles. And one of two of them have already come to fruition last year. So -- and that's why we see a big growth in our heavy-duty truck segment of market, right? So with that, we expect that to continue to 2026, barring any unforeseen. So yes, we do expect to see some continued growth in that area.

[Operator Instructions] Our next question comes from Yiming Liu from Haitong Securities.

So I've got two questions. So first one is about your backlog, especially for those associated with the data center business. So if we compare your backlog right now and like half a year ago, so I'm just wondering, is that getting larger? Or if you look at the demand and supply, so is the supply getting more and more constrained, it's getting more and more tighter. Is that what is happening for those data center engines?

Kelvin?

It has to be -- I mean, separate the operation because for the Yuchai brand high horsepower engine, most of the component supply, they are generally come from the China. So that the -- I mean, on the supply side and then we didn't have much problem there. And then because they had providing the most component for our engine assembly. But the cost-wise and then they are increasing the price this year, mainly because of the raw material increasing recently. And so that cost and then our cost up. But for the joint venture side and we do have the bottleneck and then regarding on the supply because of the supply chain from our partners and from Germany and then they do have some constraint and causing the supply of the component will be limited and then for the operation in the Chinese joint venture.

All right. But I guess I didn't get it clear. So I'm trying to ask about your backlog, I mean, the order that you received from your customer. So is that -- is the size of that getting larger during the past few months?

No. I mean we are still working very hard to fulfill those requirements. And the -- I mean, the delivery and then so far is still about between 3 to 4 months anyway.

All right. Okay. And my second question is about exports. So do you see any like increase on your European business? And what is the like the detailed segment about that? Is that about like diesel engines or gas engines? Or I mean, what is the outlook of your European business?

Are you referring to high horsepower engine or referring to the truck engine?

Mostly about the large horsepower engines.

Okay. Yes. For the export market, if we are referring to the UTai brand the -- I mean, the UTai brand operation, our export markets only account for a small percentage, about 10% and mainly in Asia. But for the MTU joint venture side, there will be -- I mean, because we sell -- we sold by our OEM and those and then we will have about over 20% or 25% of the export opportunity, and it's also on growing as well.

[indiscernible] export to the Asia market?

Yes, Asia market as well, yes.

At this time, there are no further questions from the phone line. We have now reached the end of our Q&A session. I would like to turn the call back over to Mr. Hoh.

Well, thank you all for participating in our conference call. We wish each of you good health, and we look forward to speaking with you again. Thank you.

This concludes today's conference call. Thank you for your participation. You may now disconnect your lines.

Good day, and thank you for standing by. Welcome to the China Yuchai International Limited First Half 2025 Financial Results Conference Call and Webcast. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to our first speaker today, Kevin Theiss. Please go ahead.

Thank you for joining us today, and welcome to China Yuchai International Limited's Conference Call and Webcast for the first half of 2025 ended on June 30, 2025. Joining us today are Mr. Weng Ming Hoh and Mr. Choon Sen Loo, President and Chief Financial Officer of CYI, respectively. In addition, we also have in attendance Mr. Kelvin Lai, General Manager of Operations of CYI and Chairman of MTU Yuchai Power Company Limited or MTU Yuchai Power. Before we begin, I will remind all listeners that throughout this call, we may make statements that may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words believe, expect, anticipate, project, targets, optimistic, confident that, continue to, predict, intend, aim, will or similar expressions are intended to identify forward-looking statements. All statements other than statements of historical fact are statements that may be deemed forward-looking statements. These forward-looking statements include, but are not limited to, statements concerning the company's operations and financial performance and condition and are based on current expectations, beliefs and assumptions, which are subject to change at any time. The company cautions that these statements, by their nature, involve risks and uncertainties, and actual results may differ materially depending on a variety of important factors such as government and stock exchange regulations, competition, political, economic and social conditions around the world and in China, including those discussed in the company's Form 20-F under the headings Risk Factors, Results of Operations and Business Overview and other reports filed with the Securities and Exchange Commission from time-to-time. All forward-looking statements are applicable only as of the date they are made, and the company specifically disclaims any obligation to maintain or update the forward-looking information, whether of the nature contained in the press release made during today's call or otherwise in the future. Mr. Hoh will provide a brief overview and summary, and then Mr. Loo will review the financial results for the first half year ended June 30, 2025. Thereafter, there will be a question-and-answer session. For the purposes of today's call, the 2025 and 2024 financial numbers are unaudited and presented in RMB and U.S. dollars. All financial information presented is reported using the IFRS accounting standards as issued by the International Accounting Standards Board. Mr. Hoh, please begin your prepared remarks.

Thank you, Kevin. We are pleased to report that our unit sales in the first half of 2025 outperformed nearly every on-road market category. Revenue increased by 34% year-over-year to RMB 13.8 billion or USD 1.9 billion. Gross profit rose by 30.3% year-over-year to RMB 1.8 billion or USD 257 million. Operating profit increased by 42.3% year-over-year and profit to equity holders of company rose by 62.2% year-over-year. Earnings per share were 65.8% higher year-over-year to RMB 9.75 or USD 1.36. This growth in our financial result was due to the sale of our light-duty, medium-duty and heavy-duty engines, our new energy products, high horsepower engines and solutions we provide to our customers. Our sales exceeded the vehicle unit sales in our market categories and demonstrated significant year-over-year sales growth in the first half of 2025. According to data from the China Association of Automobile Manufacturers, CAAM, truck and bus unit market sales, excluding gasoline and electric powered vehicles in first half 2025 declined by 2.6% year-on-year, while our combined truck and bus unit sales were up by 38% year-on-year. Our overall truck engine sales increased by 44.3% year-over-year compared to CAAM truck market unit sales declining by 1.8%. Our truck engine unit sales growth was led by a 40.7% year-over-year rise in the important heavy-duty truck segment in contrast to the negative 2.8% year-over-year growth in the heavy-duty truck market unit sales according to CAAM. We experienced strong growth in the HD market truck engine segment or heavy-duty truck engine segment, which is mainly attributable to gas engine sales for heavy-duty trailers. Our overall bus engine unit sales in first half 2025 achieved 8.9% year-over- year growth compared with CAAM bus unit sales of negative 7.5% year-over-year. Our heavy-duty bus engine unit sales increased by 14.4% year-over-year, contrasted with a 13.5% decline in CAAM heavy-duty bus unit sales. Our off-road market unit sales increased by 17.5% year-over-year in first half 2025, led by an engine sales increase of 31.5% year- over-year in the marine and power generation market. Data centers require significant amounts of reliable electric power to function and backup sources of electric power are essential to guarantee uninterrupted data center operations. This demand has generated robust growth in our power generation operations in the first half 2025. Yuchai subsidiary from Yuchai Marine and Genset Power Company Limited and Rolls-Royce Power Systems division has started the second phase cooperation and development of the MTU Yuchai Power Venture. Included in the second phase will be the MTU Series 4000 oil and gas generation engines, which are expected to begin shipment in late 2025. Also, by adding MTU 2000 model engine and Yuchai-branded VC series diesel engine in the near future, our power generation business is enhanced to service additional customers and application requirement. Engine unit sales for industrial applications rose by 27.2% year-over-year and engine sales for agriculture equipment experienced modest unit growth in first half 2025. The successful sales growth of our broad range of engines is a testament to our research and development expertise, our manufacturing proficiency and large service network. In addition to improving our engine products and automotive technologies, R&D is developing additional new energy products, including those using alternative fuels such as hydrogen, methanol and ammonia combustion technologies. Despite an increase in total R&D expenses in first half 2025 RMB 551.7 million or USD 77.1 million, including capitalized costs, R&D represented 4% of revenue in first half 2025 as compared to 4.5% of revenue in first half 2024. Our strategic alliance produced a year-over-year increase in profit propelled by higher sales and profit results from MTU Yuchai and improved operations as well across other ventures in first half 2025. As we are well established in the large Chinese Indian market, we view international markets as important drivers of future sales growth. Our nearby markets in ASEAN region are prime areas for penetration. Our subsidiary, Yuchai Machinery Power Systems (Thailand) is now ramping up production of a range of diesel engines for on and off-road application. Through a comprehensive strategic cooperation covering technology licensing, component supply and related support in Vietnam, we are further deepening our market penetration into the growing ASEAN market. The company paid a cash dividend of USD 0.53 per ordinary share on July 7, 2025, highlighting the company's confidence in future revenue, profits and cash flow generation and to show our commitment to building shareholder value. Cash and bank balances were RMB 7.8 billion or USD 1.1 billion as at June 30, 2025. With that, I would now like to turn the call over to Mr. Choon Sen Loo, our Chief Financial Officer, who will provide more detail on the financial results. Choon Sen, you may begin your remarks.

Thank you, Weng Ming. Now let me review our unaudited 6 months results ended June 30, 2025. Revenue was RMB 13.8 billion or USD 1.9 billion compared with RMB 10.3 billion in first half 2024. The total number of engines sold in first half 2025 increased by 29.9% to 250,396 units compared with 192,743 units in first half 2024. The increase was mainly due to higher sales in almost every engine segment. The company's truck and bus engine unit sales rose by 38% year-on-year in the first half 2025 despite a decline of 2.6% witnessed in the commercial vehicle market, excluding gasoline and electric powered vehicles as reported by the China Association of Automobile Manufacturers, CAAM. The company's truck engines were up 44.3% year-over-year compared with negative growth of 1.8% in truck market unit sales as reported by CAAM. In particular, heavy and light-duty truck engine unit sales were 40.7% and 82.1% higher year-over-year in contrast to CAAM market unit sales growth of negative 2.8% and 1.3%, respectively. The company's heavy-duty bus engine sales rose by 14.4% compared to a CAAM bus market unit sales reduction of 13.5%. Overall, bus engine unit sales increased by 8.9% in first half 2025 in contrast to a 7.5% decline in overall market unit sales as reported by CAAM. Engine sales to off-road markets increased by 17.5% year-over-year in first half 2025. Engine sales to the marine and power generation markets drove the off-road segment growth with a 31.5% year-on-year increase. Sales for industrial applications rose by 27.2% year-over-year in first half 2025, while engine sales for agricultural equipment experience modest growth in first half 2025. Gross profit increased by 30.3% to RMB 1.8 billion or USD 257 million from RMB 1.4 billion in first half 2024. The increase was mainly due to higher sales volume. Overall gross margin was 13.3% in first half 2025 compared with 13.7% in first half 2024. Other operating income increased by 27.2% to RMB 221.4 million or USD 30.9 million compared with RMB 174.1 million in first half 2024. The increase was mainly driven by the recognition of technology licensing fees and the higher rebate of value-added taxes. Research and development, R&D, expenses increased by 21.1% to RMB 476.7 million or USD 66.6 million compared with RMB 393.6 million in first half 2024, due to higher experimental and personnel costs. Total R&D expenditures, including capitalized costs were RMB 551.7 million or USD 77.1 million, representing 4.0% of revenue in first half 2025, as compared to RMB 463.2 million and 4.5% of revenue in first half 2024. Selling, general and administrative, SG&A, expenses increased by 27.4% to RMB 962.5 million or USD 134.5 million from RMB 755.7 million in first half 2024. This increase was mainly due to higher personnel expenses compared with the same period last year. SG&A expenses represented 7.0% of revenue for first half 2025 compared with 7.3% for first half 2024. Operating profit increased by 42.3% to RMB 621.7 million or USD 86.9 million, compared to RMB 436.9 million in first half 2024. The operating margin was 4.5%, in contrast to 4.2% in first half 2024. Higher operating profit and operating margin were achieved by increased sales and gross profit combined with lower growth in operating expenses. Finance costs decreased by 21.3% to RMB 32.2 million or USD 4.5 million from RMB 40.9 million in first half 2024, primarily due to lower term loans and less bills discounting. The share of financial results of the associates and joint ventures grew by 42.6% to a profit of RMB 61.4 million or USD 8.6 million compared with RMB 43.1 million in the first half 2024. The improvement was mainly driven by higher profits at MTU Yuchai Power Company Limited. Income tax expense increased by 13.4% to RMB 116.2 million or USD 16.2 million compared with RMB 102.4 million in first half 2024. Net profit attributable to equity holders of the company increased by 52.2% to RMB 365.8 million or USD 51.1 million compared with RMB 240.3 million in first half 2024. Basic and diluted earnings per share were RMB 9.75 or USD 1.36 compared with RMB 5.88 in first half 2024. Basic and diluted earnings per share for first half 2025 and first half 2024 were based on a weighted average of 37,518,322 shares and 40,858,290 shares, respectively. We will now go over some key financial highlights at June 30, 2025. Cash and bank balances were RMB 7.8 billion or USD 1.1 billion compared with RMB 6.4 billion at the end of 2024. Trade and bills receivables were RMB 12.7 billion or USD 1.8 billion compared with RMB 8.8 billion at the end of 2024. Inventories were RMB 4.7 billion or USD 655.4 million compared with RMB 4.7 billion at the end of 2024. Trade and bills payable were RMB 11.9 billion or USD 1.7 billion compared with RMB 8.5 billion at the end of 2024. Short-term and long-term loans and borrowings were RMB 2.2 billion or USD 304.6 million compared with RMB 2.5 billion at the end of 2024. I will now turn the call over to Kevin for a comment for Q&A session.

Please note, some officers of China Yuchai are remotely calling into the conference call. This may result in a slight delay in providing answers to some questions. We apologize for any inconvenience, and thank you for your patience. If you would like to ask questions in Chinese, please kindly translate your own questions into English before turning to management for answers. And before we start the Q&A, we would also like to announce that the management will be attending the forthcoming UBS Conference on September 1 and September 2, and Bank of America Merrill Lynch Conference on September 8 through September 10. If you are interested in a one-on-one or small group meeting, please contact the salespeople at these banks. Given the tight meeting schedule and travel plans, we will not be able to accept outside -- meeting requests outside of the conference venues. Now operator, we are ready for questions.[Operator Instructions] And now we're going to take our first question, and it comes from the line of Yiming Liu from Guotai Haitong Securities.

This is Yiming analyst from Guotai Haitong Securities. Congratulations to your very outstanding results for the first half. My question is on the capacity. So do you have any plan to raise your capacity for the JV with MTU or for the GYMCL entity?

This is Kelvin Lai. Regarding on the capacity and then actually, we have sufficient capacity on the MTU joint venture side. The only -- the bottleneck is the supply of the components which limited our production at the present. So if we can have the sufficient component supply from Germany, then we can increase our capacity there. But for the -- our main operation, the Yuchai operation at the GYMCL, currently, the capacity is about 2,000. And we have extension plan and that we will be ready by end of Q3 or later or early Q4 and then we will have some more extension with about 30% increase of the capacity by end of this year. And so next year, then we can enjoy a more productive roll off of the engine.

Okay. And the other question from me is on the guidance for the full year. So do you have any guidance on the unit sales for the whole year 2025? And specifically, do you have any guidance for the data center-related generators, how many units of that will be sold for the whole year 2025?

Sorry, Mr. Liu, we -- as a policy, we do not provide guidance.

Now we're going to take our next question. And the question comes from the line of Don Espey from Shah Capital.

We have a few questions actually. First question, does Yuchai have 10% or higher market share in long-bore engines for data centers? And also, do you foresee this market share holding more improving going forward?

Don, this is Kelvin again. Thank you for your question. We -- our market share on the long-bore engine or the -- well, it's made for the data center application and that our market share is well ahead of 10% of the global market. And we believe we can maintain a similar share then the -- at least this and next year, yes.

And when do you see Yuchai's net return surpassing 5% of sales from 2.6% in first half? And can you talk about initiatives to accomplish this objective?

Well, I mean, there's a lot of factors that will determine the return on sales, Don. Now there's too many to actually try to pin it down. So for now, we have not -- we are not really prepared to actually announce a target date for the return on sales. As I said earlier, we do not provide any guidance.

[Operator Instructions] And now we're going to take our next question. And the question comes from the line of Wei Shen from UBS.

The first question is about the ASP increase. You did mention that you may consider raise ASP for data center engines this year in the second half. So any color on this?

Okay. I think we have not really increased the average selling price for data centers much in this year. As I said, I think we really produce the engines, and we sell the engines to our OEM customer. The OEM customer in turn will determine the actual price of the final product, which is the genset that we sell to the end customer. Yes, our engine price has gone up slightly, but yes, it has gone up slightly.

Sorry, could you -- you mean for the first half or the second half?

For the first half. We do not provide guidance for -- again, we do not provide guidance.

Sure. My second question is, you did mention you would like to expand from engine making to generator making. So you will expand the business. Could you give us some color on this? How will this translate into revenue growth and profit per unit growth?

Now this -- we actually -- our core business is really just to sell engines. And we'll only do genset only if any customers wanted us to do it, right? So the reason for this is, we do not want to compete with our customers, the real customers, which is the OEMs. By building the both gensets, actually we're competing with customers. right? So unless the end user has a really specific need for it, otherwise we rather not do that and let our customer which is the OEM deal with it. So we do not have big revenue gain from this.

Forgot to mention, Shen Wei from UBS.

Now, we are going to take our next question, and the question comes from the line of [ Hing Shi ] from CICC.

I'm Hing Shi from CICC. My question -- there are 2 questions from me. The first question is about the on-highway engines. So we see from this year, it has a strong market share in both truck and bus engines. So I wonder the reason why the company has so strong market share in on-highway engines. And also, we see the rapid growth of new energy adoption in China's commercial vehicle sector. So I want to know how our company is seeing this phenomena and could this negatively impact the company's engine business? This is my first question. And my second question is that the company holds a significant amount of cash on hand. So can we expect any upcoming capital operation plans or higher shareholder return initiatives in the near future?

Okay. Let me answer the first question, and then I will leave the second question then to our CFO, to answer. So regarding on the truck -- on-highway market on the truck and bus sales. Our truck engine sales and is much better than the last year and then mainly because of we have some of the new customer from the Tier 1 and Tier 2 OEM and then they -- I mean, start using the Yuchai engine for the heavy-duty, medium-duty engine mainly. And on the second question -- on the second reason is also because of our introduction of the new gas engine and which is also highly adaptive for the trailer market in the Chinese domestic market. So they are one of the major reasons. Thirdly is because of the export. So the export is one of our major contribution to the growth in the first half of 2025. Regarding on the bus segment, very similar. Export market is one of the major growth -- major driver of the growth. And also, we had also quite successful on the heavy-duty bus segment and then for those buses and existing 11 meter or 12-meter above. So this is where is our major drive on the growth of the first half.

I will take the second question. Thank you for questions. So yes, our cash and bank balances increased quite handsomely compared to last year's June, end of last year. So the cash we will continue to deploy in our CapEx, including our operational maintenance CapEx. And also, you may notice that our R&D expenses also increased, so that we continue to use our cash wisely in this aspect. In terms of any specific plan in future that we will not make any comment at this point.

Now we're going to take our next question, and it comes from the line of Andy Li from Daiwa Capital Markets.

This is Andy Li from Daiwa. Congrats on the results. I just want to ask around the power gen topic. I just quickly want to clarify the 2,000 capacity from Yuchai brand, you mentioned just now, is it 30% up? I want to clarify that. And what's the execution right now? I understand you have some target or capacity share in the last -- asked at last call. Is there any update? And how is the execution there? And what about the latest negotiation activities with your clients right now from the data center point?

Andy, it's Kelvin. Thanks for the question. First of all, and then regarding on the Yuchai brand, I mean, our own in-house brand and our factory, currently, the production of 2,000 units is already the -- I mean, the highest we can do. So we confirm that there will be about 30% increase or more than 30% increase by end of this year. So at this stage and then the majority of our high horsepower engine is going to the data center. And in the first half of the 2025 that's about 650 engine for the data center and the rest is going for other applications as well. So this is our current plan. And then because the strong demand of the market on the data center projects, I think no matter how much energy increase it is difficult to meet up the current demand. And also, this is also a risky operation as well. So we are more conservative way then into the expansion plan of our factory. So we will see how the markets go on in the year 2026 and beyond before we have any planning for further extension.

Add to that, I mean the 2,000 capacity that we have for high horsepower is not entirely for data centers. So there are other applications as well that this is used for. But a large portion of it will come to data center, okay?

What about the latest auction or negotiation with your data center clients?

What do you mean?

Any like the pricing color? And I remember the last time you mentioned it's quite competitive as well, and they do the auction and the pricing are quite [indiscernible] as well. Yes. What was the dynamic there?

Okay. I think for buying -- for purchase of such magnitude, usually, they will ask for tenders. If not tenders, they will ask for several suppliers to supply, right? So a lot of this is done through our OEMs. So the OEMs -- we could probably participate in tenders through more than one OEM, because OEMs essentially is our customer and the OEMs will sell on to the end customer. But then in terms of competitiveness, yes, there is still a very competitive industry despite a shortage of capacity right now in the marketplace. So a lot of pricing for this final product of genset is determined by our customers.

Now we're going to take our next question and it comes from the line of [ Gustavo Frez ] from Global Securities.

I want to first say congratulations to the team. The results published this morning are amazing. You guys are doing a terrific job. I don't think I recall seeing these numbers, so strong numbers in the conference call for a long time. And I guess my question is, I thought or in my mind, I thought that what was going, what was transformed [Technical Difficulty]

Breaking up for us. We can't hear you.

Excuse me, Gustavo.

Yes.

We can't hear you.

Can you repeat your question again, please? Excuse me, Gustavo, your line is breaking up. We cannot hear you. Please can you repeat your question again?

Can you hear me now?

Yes, we can.

Okay. Sorry about that. I just -- I first want to congratulate the team for what's going on. The numbers published this morning are terrific. So congratulations to everyone. My question is the following. I thought that what was transforming China Yuchai was the power generation business unit. But when I look at the release this morning, it's amazing to read that most of the business units at 30% plus up this year, while the industry is flat. So there's something else going on. And I just want to understand if you guys find a specific reason for beating the market so badly this first half of the 2025.

Thanks, Mr. Frez. Basically, in the case of vehicle engines, we team up with the OEMs -- our customer OEMs who actually were actually winning some market share in the market. And also, they are willing to use more of our engines as opposed to our competitors' engines. So that one is one of the reasons that happened. And of course, it didn't happen just overnight. We have been cultivating the relationship for quite a number of years. So the other, what we call a significant driver that is the export. Our export has been growing very well and it's been increasing by double digits over the last several years and still continuing to improve. The good thing about export sales is that we do not need to sell them the National VI or Euro VI compliant engine at least, especially Euro V below simply because the areas, the countries that we export to are all the countries in the world, except North America and European markets, right? So that one -- that does give us a little bit better margin as well in the sense, okay? So the third one -- the third driver, of course, is this year is the data centers. There's been a huge growth in data centers. And those -- all those competitors who participated in this segment are also seeing very good demand. So we have quite a few things going forward, and they all came together this year.

Now we're going to take our next question, and the question comes from the line of [ Jiahao Wang ] from [ Johan Fa ] Securities.

Congratulations on your very outstanding performance. My question is, we have seen very booming demand for overseas data center markets. Does the company have any plans to expand overseas, including directly sales to overseas Internet giants?

Currently we are working with our OEM, they are our major customer. So they cover the domestic market and overseas market as well. So we will maintaining this practice and then they work through our OEM and then for both our domestic and overseas market. And there's also some change recently is from the Chinese, the Internet, the major player. And then so they are approaching us and then direct -- and then to placing the order. So we will -- also and then they are adapting and then their request and then work closely with them. But this is not all the -- I mean, the order come from -- but our major orders is still coming from OEM.

I answer your question. I think the bulk of our sales has gone to the domestic market. The domestic market is actually quite strong. So we have been servicing more on the domestic market and we have very little that has gone out to the export market, especially in Southeast Asia like Malaysia, Singapore. There are some, but not that that big part of business yet.

And now we'll go and take our next question, and the question comes from the line of [ Jackie Yu ] from CGS International.

So my question is about the capacity of the diesel engines. I want to first clarify on the number of 2,000 units capacity. Could you clarify if this is the overall capacity for the JV part plus the in-house part? And also, could you share for the in-house part, what is the bottleneck for the capacity, please?

Okay. So the 2,000 units that you mentioned, yes, it is for the overall high horsepower class 4 engines. But the part of it would be to cater to the data centers. Right now, the constraint that we have is not so much the assembly. It's in the -- we just resolved the casting capacity, which is in the machining capacity. So that's something that we're working on right now. Once we have resolved the machining capacity, then we should be able to increase volume -- for the volume. Now this is for the Yuchai side, whereas for the MTU side, it's basically the supply of components. The capacity is there, but the components which comes from overseas Western countries, there's limited capacity there themselves. And so they have to allocate the components, and we have been trying to get as much as we can and that's the bottleneck.

And my follow-up on the capacity of the JV part. So from what I understand, MTU is supplying the -- so this German component is being supplied to both the China factories and also in other countries. Could you share if this is a concern about the end market ASP? And how much is the difference between the ASP in China market versus overseas market?

I mean on the joint venture operation, because of the joint venture agreement and then there's some component that we need to procure from the German operation. So that's why we are not allowing them to localize those items. And at the moment, mainly those items being insufficient high that being a bottleneck for the whole operation. And those items, they are not only intent to supply to China, but they will also supply the worldwide operation of the MTU. So that's why our allocation for the Chinese operation is somehow very limited and that depends on the overall demand of the global market. And there will be some priority in it for the German operation and also for the U.S. operation as well. So that's why we are always -- I mean, there's some shortage. And then we have the order book -- already in the book.

Maybe, operator, we'll take a question from the webcast. The question is any chance you will raise the dividend payout and repurchase? We have no plans for the repurchase right now. But in terms of dividend, I mean, our track record and payment of dividend is quite good, although we do not have a formal dividend payout policy. So it will be likely continue the same practice going forward.

[Operator Instructions] Excuse me, Andy, would you like to ask a question? And now we have a question from Jackie Yu from CGS International. And I have a question from Andy Li from Daiwa Capital Markets.

Can I have a follow-up on the JV profit? I remember last result, you mentioned that there was another session in your JV that was just reached breakeven. How is that segment and other segments performing this first half?

Okay. I think that segment that was breakeven last year, it's actually making a little bit more profit this year, but it's still not very material yet. We still need some time to develop that. So the part of the profit from JV in the associates account comes from mainly from the MTU Yuchai joint venture.

We have now reached the end of our question-and-answer session. I will turn the call back over to Mr. Hoh. Please go ahead.

Thank you all for participating in our conference call. We wish each and every one of you good health, and we look forward to speaking with you again. Thank you.

This concludes today's conference call. Thank you for participating. You may now all disconnect. My apologies. We just have got one more question come through. Are you happy to take?

Yes, please.

Just give us a moment. And the question comes from the line of [ Martin Zhang from HT Capital. ]

I just want to clarify that for the data center engine shipment, like how many have you shipped from Yuchai and how many it was shipped from the MTU JV for the first half of the year?

Martin, at the first half of 2025 and our own operation, the Yuchai and then they shipped 650 units for the market. And the MTU joint venture is 350. So total is about 1,000 altogether for the first half.

Are they all for the data center or --

Yes. This is for data center.

And may I get a breakdown for like domestic and overseas? I think you mentioned that for Yuchai yourself mostly for domestic, but how about for the MTU JV?

For the JV and then there's a little more share for the export to our OEM, but still mainly and then for the domestic market.

And I got the last one that may I ask about your order visibility. I think with your expanded capacity, are you still fully booked this year? And like if you take a new order, when will be like -- I mean, the fastest time that you could deliver?

We actually had a full order book for this year and for our Yuchai brand and also for the joint venture brand. For the next year, on the 2026, the joint venture is starting receiving order.

And this was our last question for today. And we now would like to turn back to Mr. Hoh for any closing remarks.

Okay. I think we already did that earlier. So yes, thank you all. We will speak to you again soon, right? Thank you.

This concludes today's conference call. Thank you for participating. You may now all disconnect. Have a nice day.