Document_And_Entity_Informatio
Document And Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Nov. 12, 2014 | |
Document Information [Line Items] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Trading Symbol | 'CAAS | ' |
Entity Common Stock, Shares Outstanding | ' | 32,121,019 |
Entity Registrant Name | 'CHINA AUTOMOTIVE SYSTEMS INC | ' |
Entity Central Index Key | '0001157762 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations and Comprehensive Income (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Net product sales | $101,735 | $90,919 | $331,517 | $285,971 |
Cost of products sold | 81,152 | 74,394 | 268,013 | 231,696 |
Gross profit | 20,583 | 16,525 | 63,504 | 54,275 |
Gain on other sales | 1,132 | 5,030 | 10,267 | 6,762 |
Less: Operating expenses | ' | ' | ' | ' |
Selling expenses | 3,734 | 2,647 | 11,104 | 9,611 |
General and administrative expenses | 3,734 | 2,821 | 11,056 | 10,164 |
Research and development expenses | 5,441 | 5,117 | 16,509 | 13,134 |
Total operating expenses | 12,909 | 10,585 | 38,669 | 32,909 |
Income from operations | 8,806 | 10,970 | 35,102 | 28,128 |
Other income, net | 113 | 499 | 491 | 573 |
Financial income, net | 412 | 689 | 598 | 380 |
Income before income tax expenses and equity in earnings of affiliated companies | 9,331 | 12,158 | 36,191 | 29,081 |
Less: Income taxes | 1,387 | 1,854 | 6,488 | 5,172 |
Equity in earnings of affiliated companies | 82 | 125 | 220 | 251 |
Net income | 8,026 | 10,429 | 29,923 | 24,160 |
Net income attributable to non-controlling interests | 1,293 | 1,805 | 5,409 | 4,616 |
Net income attributable to parent company's common shareholders | 6,733 | 8,624 | 24,514 | 19,544 |
Comprehensive income: | ' | ' | ' | ' |
Net income | 8,026 | 10,429 | 29,923 | 24,160 |
Other comprehensive income: | ' | ' | ' | ' |
Foreign currency translation gain, net of tax | 9 | 1,218 | -2,413 | 5,265 |
Comprehensive income | 8,035 | 11,647 | 27,510 | 29,425 |
Comprehensive income attributable to non-controlling interests | 1,293 | 2,010 | 5,006 | 5,507 |
Comprehensive income attributable to parent company | $6,742 | $9,637 | $22,504 | $23,918 |
Net income attributable to parent company's common shareholders per share | ' | ' | ' | ' |
Basic - (in dollars per share) | $0.24 | $0.31 | $0.87 | $0.70 |
Diluted (in dollars per share) | $0.24 | $0.31 | $0.87 | $0.70 |
Weighted average number of common shares outstanding | ' | ' | ' | ' |
Basic (in shares) | 28,043,019 | 28,043,019 | 28,043,019 | 28,043,019 |
Diluted (in shares) | 28,063,661 | 28,062,297 | 28,063,846 | 28,054,008 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Operations and Comprehensive Income [Parenthetical] (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Revenue from Related Parties | $11,890 | $9,166 | $38,627 | $26,344 |
Related Party Costs | $6,069 | $10,500 | $20,721 | $23,171 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Current assets: | ' | ' | ||
Cash and cash equivalents | $41,569 | $53,979 | ||
Pledged cash deposits | 31,703 | 33,963 | ||
Short-term investments | 43,266 | 35,510 | ||
Accounts and notes receivable, net - unrelated parties | 281,620 | 267,639 | ||
Accounts and notes receivable, net - related parties | 22,253 | 17,194 | ||
Advance payments and others - unrelated parties | 2,073 | 3,156 | ||
Advance payments and others - related parties | 1,715 | 866 | ||
Inventories | 72,691 | 51,392 | ||
Assets held for sale | 0 | 925 | ||
Current deferred tax assets | 6,419 | 5,783 | ||
Total current assets | 503,309 | 470,407 | ||
Non-current assets: | ' | ' | ||
Property, plant and equipment, net | 81,710 | [1] | 80,018 | [1] |
Intangible assets, net | 1,572 | 686 | ||
Other receivables, net - unrelated parties | 1,892 | 252 | ||
Other receivables, net - related parties | 48 | 108 | ||
Advance payment for property, plant and equipment - unrelated parties | 3,912 | 3,488 | ||
Advance payment for property, plant and equipment - related parties | 2,391 | 2,097 | ||
Long-term investments | 3,660 | 4,023 | ||
Goodwill | 642 | 0 | ||
Non-current deferred tax assets | 4,760 | 4,528 | ||
Total assets | 603,896 | 565,607 | ||
Current liabilities: | ' | ' | ||
Bank and government loans | 45,565 | 37,381 | ||
Accounts and notes payable - unrelated parties | 203,397 | 198,419 | ||
Accounts and notes payable - related parties | 3,837 | 4,634 | ||
Customer deposits | 2,979 | 1,677 | ||
Accrued payroll and related costs | 6,568 | 7,052 | ||
Accrued expenses and other payables | 73,340 | 29,062 | ||
Accrued pension costs | 6,044 | 4,626 | ||
Taxes payable | 8,537 | 7,792 | ||
Amounts due to shareholders/directors | 376 | 312 | ||
Current deferred tax liabilities | 220 | 117 | ||
Total current liabilities | 350,863 | 291,072 | ||
Long-term liabilities: | ' | ' | ||
Advances payable | 2,875 | 2,764 | ||
Non-current deferred tax liabilities | 329 | 0 | ||
Total liabilities | 354,067 | 293,836 | ||
Commitments and Contingencies (See Note 29) | ' | ' | ||
Stockholders’ equity: | ' | ' | ||
Common stock, $0.0001 par value - Authorized - 80,000,000 shares; Issued-28,260,302 and 28,260,302 shares as of September 30, 2014 and December 31, 2013, respectively | 3 | 3 | ||
Additional paid-in capital | 27,209 | 39,565 | ||
Retained earnings- | ' | ' | ||
Appropriated | 10,178 | 10,048 | ||
Unappropriated | 170,407 | 146,023 | ||
Accumulated other comprehensive income | 34,794 | 32,061 | ||
Treasury stock - 217,283 and 217,283 shares as of September 30, 2014 and December 31, 2013, respectively | -1,000 | -1,000 | ||
Total parent company stockholders' equity | 241,591 | 226,700 | ||
Non-controlling interests | 8,238 | 45,071 | ||
Total stockholders' equity | 249,829 | 271,771 | ||
Total liabilities and stockholders' equity | $603,896 | $565,607 | ||
[1] | As of September 30, 2014 and December 31, 2013, the Company had pledged property, plant and equipment with net book value of $46.8 million and $51.4 million, respectively, for its comprehensive credit facilities with banks in China. |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets [Parenthetical] (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 80,000,000 | 80,000,000 |
Common stock, shares issued | 28,260,302 | 28,260,302 |
Treasury stock, shares outstanding | 217,283 | 217,283 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | ||
Cash flows from operating activities: | ' | ' | ||
Net income | $29,923 | $24,160 | ||
Adjustments to reconcile net income from operations to net cash provided by operating activities: | ' | ' | ||
Stock-based compensation | 193 | [1] | 194 | [1] |
Depreciation and amortization | 11,592 | 10,964 | ||
Increase (decrease) in allowance for doubtful accounts | 177 | -139 | ||
Inventory write downs | 2,531 | 480 | ||
Deferred income taxes | -907 | -1,611 | ||
Equity in earnings of affiliated companies | -182 | -251 | ||
Amortization of debt issue cost | 0 | 58 | ||
Gain on fixed assets disposals | -7,500 | -4,288 | ||
(Increase) decrease in: | ' | ' | ||
Pledged deposits | 1,953 | 1,413 | ||
Accounts and notes receivable | -19,173 | -36,803 | ||
Advance payments and others | 328 | 465 | ||
Inventories | -17,449 | -9,076 | ||
Increase (decrease) in: | ' | ' | ||
Accounts and notes payable | 2,363 | 6,199 | ||
Customer deposits | 1,313 | 1,016 | ||
Accrued payroll and related costs | -423 | 514 | ||
Accrued expenses and other payables | 597 | 3,459 | ||
Accrued pension costs | 1,460 | 653 | ||
Taxes payable | 1,257 | 3,256 | ||
Advances payable | 8 | -32 | ||
Net cash provided by operating activities | 8,061 | 631 | ||
Cash flows from investing activities: | ' | ' | ||
Increase (decrease) in other receivables | -347 | 158 | ||
Cash received from property, plant and equipment sales | 6,994 | 6,282 | ||
Payments to acquire property, plant and equipment | -11,317 | -9,065 | ||
Payments to acquire intangible assets | -252 | -109 | ||
Purchase of short-term investments | -46,192 | -32,197 | ||
Proceeds from maturities of short-term investments | 38,115 | 0 | ||
Acquisition of Fujian Qiaolong, net of cash acquired | -2,976 | 0 | ||
Dividends from investment under cost method | 0 | 66 | ||
Net cash used in investing activities | -15,975 | -34,865 | ||
Cash flows from financing activities: | ' | ' | ||
Proceeds from government and bank loan | 15,836 | 15,588 | ||
Repayments of bank loan | -9,590 | -14,758 | ||
Dividends paid to the non-controlling interests | -6,048 | -1,381 | ||
Dividends paid to the holders of the Company’s common stock | -4,291 | 0 | ||
Increase (decrease) in amounts due to shareholders/directors | 69 | -40 | ||
Net cash used in financing activities | -4,024 | -591 | ||
Effects of exchange rate on cash and cash equivalents | -472 | 1,878 | ||
Net decrease in cash and cash equivalents | -12,410 | -32,947 | ||
Cash and cash equivalents at beginning of period | 53,979 | 87,649 | ||
Cash and cash equivalents at end of period | 41,569 | 54,702 | ||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ' | ' | ||
Cash paid for interest | 893 | 972 | ||
Cash paid for income taxes | 3,459 | 4,217 | ||
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ' | ' | ||
Advance payments for acquiring property, plant and equipment | 6,303 | 2,777 | ||
Non-controlling interests arising as a result of acquisition of Fujian Qiaolong | 2,793 | [2] | 0 | [2] |
Payables for the acquisition of non-controlling interests in Henglong and Jiulong | 37,314 | 0 | ||
Account receivable for the sale of land use rights | 1,890 | 0 | ||
Dividends payable to the Company’s shareholders | 757 | 0 | ||
Dividends payable to non-controlling interests | 4,063 | 86 | ||
Dividends receivable from joint venture company | 508 | 0 | ||
SUPPLEMENTAL DISCLOSURE OF ACQUISITION | ' | ' | ||
Purchase consideration settled in cash for Fujian Qiaolong | -3,007 | 0 | ||
Less: cash acquired | 31 | 0 | ||
Investing cash outflow for acquisitions | ($2,976) | $0 | ||
[1] | On September 16, 2014 and August 13, 2013, the Company granted 22,500 and 22,500 stock options, respectively, to the Company’s independent directors, with the exercise price equal to the closing price of the Company’s common stock traded on NASDAQ on the date of grant. The fair value of stock options was determined at the date of grant using the Black-Scholes option pricing model. The Black-Scholes option model requires management to make various estimates and assumptions, including expected term, expected volatility, risk-free rate and dividend yield. The expected term represents the period of time that stock-based compensation awards granted are expected to be outstanding and is estimated based on considerations including the vesting period, contractual term and anticipated employee exercise patterns. Expected volatility is based on the historical volatility of the Company’s stock. The risk-free rate is based on the U.S. Treasury yield curve in relation to the contractual life of stock-based compensation instruments. The dividend yield assumption is based on historical patterns and future expectations for the Company’s dividends. | |||
[2] | In the second quarter of 2014, the Company acquired a 51.0% equity interest in Fujian Qiaolong (See Note 3). The fair value of the non-controlling interest of Fujian Qiaolong is $2.8 million. |
Organization_and_business
Organization and business | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ||||||||
Organization and Business [Text Block] | ' | ||||||||
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 and the joint ventures 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. Great Genesis is mainly engaged in the manufacture and sale of automotive systems and components through its controlled subsidiaries and the joint ventures, as described below. | |||||||||
Henglong USA Corporation, “HLUSA,” incorporated on January 8, 2007 in Troy, Michigan, is a wholly-owned subsidiary of the Company, and is mainly engaged 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 entities established in the People's Republic of China, the “PRC,” and Brazil as of September 30, 2014 and December 31, 2013. | |||||||||
Percentage Interest | |||||||||
September 30, | December 31, | ||||||||
Name of Entity | 2014 | 2013 | |||||||
Shashi Jiulong Power Steering Gears Co., Ltd., “Jiulong” 1 | 100 | % | 81 | % | |||||
Jingzhou Henglong Automotive Parts Co., Ltd., “Henglong” 2 | 100 | % | 80 | % | |||||
Shenyang Jinbei Henglong Automotive Steering System Co., Ltd., “Shenyang” 3 | 70 | % | 70 | % | |||||
Universal Sensor Application Inc., “USAI” 4 | 83.34 | % | 83.34 | % | |||||
Wuhan Jielong Electric Power Steering Co., Ltd., “Jielong” 5 | 85 | % | 85 | % | |||||
Wuhu HengLong Automotive Steering System Co., Ltd., “Wuhu” 6 | 77.33 | % | 77.33 | % | |||||
Hubei Henglong Automotive System Group Co., Ltd, “Hubei Henglong” 7 | 100 | % | 100 | % | |||||
Jingzhou Henglong Automotive Technology (Testing) Center, “Testing Center” 8 | 80 | % | 80 | % | |||||
Beijing Henglong Automotive System Co., Ltd., “Beijing Henglong” 9 | 50 | % | 50 | % | |||||
Chongqing Henglong Hongyan Automotive System Co., Ltd., “Chongqing Henglong” 10 | 70 | % | 70 | % | |||||
CAAS Brazil’s Imports And Trade In Automotive Parts Ltd., “Brazil Henglong” 11 | 80 | % | 80 | % | |||||
Fujian Qiaolong Special Purpose Vehicle Co., Ltd., “Fujian Qiaolong” 12 | 51 | % | - | ||||||
Wuhan Chuguanjie Automotive Science and Technology Ltd., “Wuhan Chuguanjie” 13 | 85 | % | - | ||||||
1. | Jiulong was established in 1993 and mainly engages in the production of integral power steering gear for heavy-duty vehicles. On August 11, 2014, the Company entered into a Stock Exchange Agreement (the “Exchange Agreement”) with a third party, Jingzhou City Jiulong Machinery Electricity Manufacturing Co., Ltd. (“Jiulong Machinery Electricity”), under which the Company issued 818,000 of its common shares in a private placement for the acquisition of the 19% equity interest in Jiulong held by Jiulong Machinery Electricity. On September 26, 2014, the Company obtained the 19% equity interest in Jiulong and completed its share registration with the local government administrative bureau. Therefore, the Company owned 100% of the equity interests in Jiulong as of September 30, 2014. While the Company retains its controlling interest of Jiulong, the Company’s acquisition of the non-controlling interest was accounted for as an equity transaction in the quarter ended September 30, 2014. On October 13, 2014, the Company completed its issuance of 818,000 common shares at market price of $9.15 per share in a private placement to nominee holders of Jiulong Machinery Electricity (See Notes 19 and 32). | ||||||||
2. | Henglong was established in 1997 and is mainly engaged in the production of rack and pinion power steering gears for cars and light duty vehicles. On August 11, 2014, the Company entered into the Exchange Agreement with a third party, Jiulong Machinery Electricity, under which the Company issued 3,260,000 of its common shares in a private placement for the acquisition of the 20% equity interest in Henglong held by Jiulong Machinery Electricity. On September 26, 2014, the Company obtained the 20% equity interest in Henglong and completed its share registration with the local government administrative bureau. Therefore, the Company owned 100% equity interests in Henglong as of September 30, 2014. While the Company retains its controlling interest of Henglong, the Company’s acquisition of the non-controlling interest was accounted for as an equity transaction in the quarter ended September 30, 2014. On October 13, 2014, the Company completed its issuance of 3,260,000 common shares at market price of $9.15 per share in a private placement to nominee holders of Jiulong Machinery Electricity (See Notes 19 and 32). | ||||||||
3 | Shenyang was established in 2002 and focuses on power steering parts for light duty vehicles. | ||||||||
4 | USAI was established in 2005 and mainly engages in the production and sales of sensor modules. | ||||||||
5 | Jielong was established in 2006 and mainly engages in the production and sales of electric power steering, “EPS.” | ||||||||
6 | Wuhu was established in 2006 and mainly engages in the production and sales of automobile steering systems. | ||||||||
7 | 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. | ||||||||
8 | In December 2009, Henglong, a subsidiary of Genesis, formed the Testing Center, which mainly engages in the research and development of new products. The registered capital of the Testing Center was RMB30.0 million, equivalent to approximately $4.4 million. | ||||||||
9 | On January 24, 2010, Genesis entered into a joint venture contract with Beijing Hainachuan Auto Parts Co., Ltd. to establish Beijing Henglong as a joint venture company to design, develop and manufacture both hydraulic and electric power steering systems and parts. On September 16, 2010, with Beijing Hainachuan’s agreement, Genesis transferred its interest in the joint venture to Hubei Henglong, and left the other terms of the joint venture contract unchanged. According to the joint venture agreement, the Company does not have voting control of Beijing Henglong. Therefore, the Company’s consolidated financial statements do not include Beijing Henglong, and such investment is accounted for through the equity method. | ||||||||
10 | 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. | ||||||||
11 | 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. | ||||||||
12 | In the second quarter of 2014, the Company acquired a 51.0% ownership interest in Fujian Qiaolong Special Purpose Vehicle Co., Ltd., “Fujian Qiaolong”, a special purpose vehicle manufacturer and dealer with automobile repacking qualifications, based in Fujian, China. Fujian Qiaolong mainly manufactures and distributes drainage and rescue vehicles with mass flow, drainage vehicles with vertical downhole operation, crawler-type mobile pump stations, high-altitude water supply and discharge drainage vehicles, long-range control crawler-type mobile pump stations and other vehicles. The consideration was approximately $3.0 million. | ||||||||
13 | In May 2014, 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. The registered capital of Wuhan Chuguanjie is RMB30.0 million, equivalent to approximately $4.9 million. At the date of release of this quarterly report, Jielong has not completed the capital injection | ||||||||
On September 22, 2014, Hubei Henglong entered into an agreement with seven other parties to establish a venture capital fund, the “Venture Fund”, which mainly focuses on investments in emerging automobiles and parts industries. Total share capital of the Venture Fund is RMB280.0 million (equivalent to approximately $45.5 million). The initial term of the fund is eight years. Hubei Henglong has committed to make investments into the Venture Fund of 17.9% or RMB50.0 million (equivalent to approximately $8.1 million), which will be paid in three installments. As Hubei Henglong is a limited partner of the Venture Fund and has no significant influence on the operation and decision-making of the Venture Fund, this investment will be accounted for using the cost method. On October 20, 2014, Hubei Henglong made its first capital contribution of RMB5.0 million (equivalent to approximately $0.8 million) (See Note 32). | |||||||||
Basis_of_presentation_and_sign
Basis of presentation and significant accounting policies | 9 Months Ended | |
Sep. 30, 2014 | ||
Accounting Policies [Abstract] | ' | |
Basis of Presentation and Significant Accounting Policies [Text Block] | ' | |
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 Article 10 of 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, 2013. | ||
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, 2013 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. | ||
Certain information and footnote disclosures normally included in financial statements that have been prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission, although the Company’s management believes that the disclosures contained in these financial statements are adequate to make the information presented herein not misleading. For further information, please refer to the financial statements and the notes thereto included in the Company’s 2013 Annual Report on Form 10-K, as filed with the Securities and Exchange Commission. | ||
The results of operations for the three months and nine months ended September 30, 2014 are not necessarily indicative of the results of operations to be expected for the full fiscal year ending December 31, 2014. | ||
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. | ||
(b) | Recent Accounting Pronouncements | |
In April 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2014-08 “Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity”. The new guidance changes the criteria for reporting discontinued operations while enhancing disclosures in this area. Under the new guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. Those strategic shifts should have a major effect on the organization’s operations and financial results. Additionally, ASU 2014-08 requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of discontinued operations. The new guidance also requires disclosure of the pre-tax income attributable to a disposal of a significant part of an organization that does not qualify for discontinued operations reporting. ASU 2014-08 is effective for the Company in the first quarter of fiscal 2015. Early adoption is permitted, but only for disposals (or classifications as held for sale) that have not been reported in financial statements previously issued or available for issuance. The Company is currently evaluating the impact of adopting this update on its financial statements. | ||
In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (“ASU 2014-09”), “Revenue from Contracts with Customers (Topic 606)”. ASU 2014-09 will eliminate transaction-specific and industry-specific revenue recognition guidance under current U.S. GAAP and replace it with a principle-based approach for determining revenue recognition. ASU 2014-09 will require that companies recognize revenue based on the value of transferred goods or services as they occur in the contract. The ASU also will require additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. ASU 2014-09 is effective for reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early adoption is not permitted. Entities can transition to the standard either retrospectively or as a cumulative effect adjustment as of the date of adoption. Management is currently assessing the impact the adoption of ASU 2014-09 and the effect of the standard on our ongoing financial reporting. | ||
In June 2014, the FASB issued Accounting Standards Update No. 2014-12 (“ASU 2014-12”), “Compensation—Stock Compensation (Topic 718) - Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period.” ASU 2014-12 requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in Topic 718 as it relates to awards with performance conditions that affect vesting to account for such awards. As such, the performance target should not be reflected in estimating the grant-date fair value of the award. Compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. As indicated in the definition of vest, the stated vesting period (which includes the period in which the performance target could be achieved) may differ from the requisite service period. For all entities, the amendments in this Update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The effective date is the same for both public business entities and all other entities. Entities may apply the amendments in this Update either (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. If retrospective transition is adopted, the cumulative effect of applying this Update as of the beginning of the earliest annual period presented in the financial statements should be recognized as an adjustment to the opening retained earnings balance at that date. Additionally, if retrospective transition is adopted, an entity may use hindsight in measuring and recognizing the compensation cost. The Company is currently evaluating the impact of adopting this Update on its financial statements. | ||
In August 2014, the FASB issued Accounting Standards Update No. 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern”, which will explicitly require management to assess an entity’s ability to continue as a going concern and to provide related footnote disclosures in certain circumstances. Currently, there is no guidance in GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern or to provide related footnote disclosures. The amendments in this Update provide that guidance. In doing so, the amendments should reduce diversity in the timing and content of footnote disclosures. The amendments require management to assess an entity’s ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the amendments (1) provide a definition of the term “substantial doubt”, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The amendments in this update are effective for the first annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company is currently evaluating the impact of adopting this update on its financial statements. | ||
(c) | Significant Accounting Policies | |
Business Combinations – A business combination is recorded using the purchase method of accounting, and the cost of an acquisition is measured as the aggregate of the fair values at the date of exchange of the assets given, liabilities incurred, and equity instruments issued as well as the contingent considerations and all contractual contingencies as of the acquisition date. The costs directly attributable to the acquisition are expensed as incurred. Identifiable assets, liabilities and contingent liabilities acquired or assumed are measured separately at their fair value as of the acquisition date, irrespective of the extent of any non-controlling interests. The excess of (i) the total of consideration of acquisition, fair value of the non-controlling interests and acquisition date fair value of any previously held equity interest in the subsidiary acquired over (ii) the fair value of the identifiable net assets of the subsidiary acquired is recorded as goodwill. If the consideration of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in the consolidated statements of operations and comprehensive income. | ||
Goodwill - Goodwill represents the excess of the purchase price over the fair value of the identifiable assets and liabilities acquired as a result of the Company’s acquisition of interests in its subsidiary. We test goodwill for impairment at the reporting unit level on an annual basis as of December 31, and between annual tests when an event occurs or circumstances change that could indicate that the asset might be impaired. The Company adopted the FASB revised guidance on “Testing of Goodwill for Impairment.” Under this guidance, the Company has the option to choose whether it will apply the qualitative assessment first and then the quantitative assessment, if necessary, or to apply the quantitative assessment directly. For a reporting unit applying a qualitative assessment first, the Company starts the goodwill impairment test by assessing qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If the Company determines that it is more likely than not the fair value of a reporting unit is less than its carrying amount, the quantitative impairment test is mandatory. Otherwise, no further testing is required. The quantitative impairment test uses a two-step process. In the first step, the fair value of a reporting unit is compared to its carrying value. If the fair value of a reporting unit exceeds the carrying value of the net assets assigned to a reporting unit, goodwill is considered not impaired and no further testing is required. If the carrying value of the net assets assigned to a reporting unit exceeds the fair value of a reporting unit, the second step of the impairment test is performed in order to determine the implied fair value of a reporting unit’s goodwill. Determining the implied fair value of goodwill requires valuation of a reporting unit’s tangible and intangible assets and liabilities in a manner similar to the allocation of purchase price in a business combination. If the carrying value of a reporting unit’s goodwill exceeds its implied fair value, goodwill is deemed impaired and is written down to the extent of the difference. The Company estimates total fair value of the reporting unit using discounted cash flow analysis, and makes assumptions regarding future revenue, gross margins, working capital levels, investments in new products, capital spending, tax, cash flows, and the terminal value of the reporting unit. | ||
There have been no other updates to the significant accounting policies set forth in the notes to the consolidated financial statements for the year ended December 31, 2013. | ||
Acquisition
Acquisition | 9 Months Ended | ||||
Sep. 30, 2014 | |||||
Business Combinations [Abstract] | ' | ||||
Business Combination Disclosure [Text Block] | ' | ||||
3 | Acquisition | ||||
In the second quarter of 2014, the Company acquired a 51.0% ownership interest in Fujian Qiaolong, a special purpose vehicle manufacturer and dealer with automobile repacking qualification, based in Fujian, China. Fujian Qiaolong mainly manufactures and distributes drainage and rescue vehicle with mass flow, drainage vehicles with vertical downhole operation, crawler-type mobile pump stations, high-altitude water supply and discharge drainage vehicles, long-range control crawler-type mobile pump stations and other vehicles. The acquisition expands the Company’s scope of business and improves the Company’s product mix. The results of Fujian Qiaolong have been included since the date of acquisition and are reflected in the Company’s Condensed Unaudited Consolidated Statements of Operations and Comprehensive Income. The total purchase price was approximately $3.0 million. The goodwill resulting from the acquisition is not deductible for tax purposes. | |||||
The following table summarizes the allocation of consideration and the respective fair values of the assets acquired and liabilities assumed in the Fujian Qiaolong acquisition as of the date of purchase (figures are in thousands of USD): | |||||
Total purchase price: | |||||
Cash consideration paid to acquire ownership interest | $ | 3,007 | |||
Assets | |||||
Cash and cash equivalents | $ | 31 | |||
Current assets, net of cash acquired | 8,428 | ||||
Deferred tax asset | 69 | ||||
Property and equipment | 3,694 | ||||
Intangible assets | 864 | ||||
Goodwill | 642 | ||||
Total assets consolidated into the Company | $ | 13,728 | |||
Liabilities | |||||
Current liabilities, excluding current deferred tax liabilities | -7,352 | ||||
Deferred tax liabilities | -448 | ||||
Other liabilities | -128 | ||||
Total liabilities consolidated into the Company | -7,928 | ||||
Non-controlling interests at fair value | -2,793 | ||||
Total equity consolidated into the Company | $ | 3,007 | |||
Pro forma results of operations for the acquisition of Fujian Qiaolong have not been presented because it is not material to the consolidated results of operations. | |||||
For the acquisition of Fujian Qiaolong, intangible assets which have been assessed and recognized, such as patents and developed technology, have a weighted-average useful life of 4.7 years. | |||||
Pledged_cash_deposits
Pledged cash deposits | 9 Months Ended | |
Sep. 30, 2014 | ||
Cash and Cash Equivalents [Abstract] | ' | |
Cash and Cash Equivalents Disclosure [Text Block] | ' | |
4 | Pledged cash deposits | |
Pledged cash deposits are used as guarantees for the Company’s notes payable and their use is restricted. The Company regularly pays some of its suppliers by bank notes. The Company has to make a cash deposit, generally equivalent to 30 % - 100% of the face value of the relevant bank note in order to obtain the bank note. | ||
Shortterm_investments
Short-term investments | 9 Months Ended | |
Sep. 30, 2014 | ||
Short Term Investments Disclosure [Abstract] | ' | |
Short Term Investments Disclosure [Text Block] | ' | |
5 | Short-term investments | |
Short-term investments comprise time deposits with maturity terms of more than three months but due within one year. The carrying values of time deposits approximate fair value because of their short maturities. The interest earned is recognized in the condensed unaudited statements of operations and comprehensive income over the contractual term of the deposit. | ||
As of September 30, 2014, the Company had pledged short-term investments of RMB33.0 million (equivalent to approximately $5.4 million) to secure loans under the credit facility issued by HSBC Bank (China) Company Limited Hong Kong branch (“HSBC HK”) and the use of the pledged short-term investments is restricted (See Note 14). | ||
Accounts_and_notes_receivable_
Accounts and notes receivable, net | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Accounts and Notes Receivable Disclosure [Abstract] | ' | |||||||
Accounts and Notes Receivable Disclosure [Text Block] | ' | |||||||
6 | Accounts and notes receivable, net | |||||||
The Company’s accounts and notes receivable as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Accounts receivable - unrelated parties (1) | $ | 131,134 | $ | 140,920 | ||||
Notes receivable - unrelated parties (2) (3) | 151,926 | 128,068 | ||||||
Total accounts and notes receivable- unrelated parties | 283,060 | 268,988 | ||||||
Less: allowance for doubtful accounts - unrelated parties | -1,440 | -1,349 | ||||||
Accounts and notes receivable, net - unrelated parties | 281,620 | 267,639 | ||||||
Accounts and notes receivable, net - related parties | 22,253 | 17,194 | ||||||
Accounts and notes receivable, net | $ | 303,873 | $ | 284,833 | ||||
-1 | As of September 30, 2014 and December 31, 2013, the Company has pledged $11.0 million and $19.1 million, respectively, of accounts receivable as security for its comprehensive credit facilities with banks in China. | |||||||
-2 | Notes receivable represent accounts receivable in the form of bills of exchange for which acceptances are guaranteed and settlements are handled by banks. | |||||||
-3 | As of September 30, 2014, Henglong collateralized its notes receivable in an amount of RMB229.2 million (equivalent to approximately $37.3 million) as security for the credit facilities with banks in China and the Chinese government, including RMB197.8 million (equivalent to approximately $32.2 million) in favor of Industrial and Commercial Bank of China, Jingzhou Branch, “ICBC Jingzhou,” for the purpose of obtaining the Henglong Standby Letter of Credit (as defined in Note 14) which is used as security for the non-revolving credit facility in the amount of $30.0 million provided by Industrial and Commercial Bank of China (Macau) Limited, “ICBC Macau,” and RMB31.4 million (equivalent to approximately $5.1 million) in favor of the Chinese government as security for the low-interest government loan (See Note 14). As of December 31, 2013, Henglong collateralized its notes receivable in an amount of RMB196.3 million (equivalent to approximately $32.2 million) in favor of Industrial and Commercial Bank of China, Jingzhou Branch, “ICBC Jingzhou,” for the purpose of obtaining the Henglong Standby Letter of Credit (as defined in Note 14) which is used as security for the non-revolving credit facility in the amount of $30.0 million provided by Industrial and Commercial Bank of China (Macau) Limited, “ICBC Macau.” | |||||||
Inventories
Inventories | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Inventory Disclosure [Text Block] | ' | |||||||
7 | Inventories | |||||||
The Company’s inventories as of September 30, 2014 and December 31, 2013 consisted of the following (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Raw materials | $ | 18,137 | $ | 12,185 | ||||
Work in process | 13,462 | 8,079 | ||||||
Finished goods | 41,092 | 31,128 | ||||||
Total | $ | 72,691 | $ | 51,392 | ||||
Provision for inventories amounted to $2.5 million and $0.5 million for the nine months ended September 30, 2014 and 2013, respectively. | ||||||||
Other_receivables_net
Other receivables, net | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Other Receivables Disclosure [Abstract] | ' | |||||||
Other Receivables Disclosure [Text Block] | ' | |||||||
8 | Other receivables, net | |||||||
The Company’s other receivables as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Other receivables - unrelated parties (1) | $ | 653 | $ | 314 | ||||
Less: allowance for doubtful accounts- unrelated parties | -108 | -62 | ||||||
Subtotal | 545 | 252 | ||||||
Other receivables - employee housing loans (2) | 839 | - | ||||||
DiviDividend receivables - affiliated company (3) | 508 | - | ||||||
Other receivables, net - unrelated parties | $ | 1,892 | $ | 252 | ||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Other receivables - related parties (1) | $ | 711 | $ | 729 | ||||
Less: allowance for doubtful accounts- related parties | -663 | -621 | ||||||
Other receivables, net - related parties | $ | 48 | $ | 108 | ||||
-1 | Other receivables consist of amounts advanced to both related and unrelated parties, primarily as unsecured demand loans, with no stated interest rate or due date. These receivables originate as part of the Company's normal operating activities and are periodically settled in cash. | |||||||
-2 | On May 28, 2014, the board of directors of the Company approved a loan program under which the Company will lend an aggregate of up to RMB50.0 million (equivalent to approximately $8.1 million) to the employees of the Company to assist them in purchasing houses. Employees are required to pay interest at an annual rate of 6.4%. The term of the loans is generally for five years. The Company accounts for employee loans to be repaid within 12 months from the ending date of reporting period in Advance payments and others - unrelated parties and loans to be repaid in more than 12 months in Other receivables - unrelated parties. As of September 30, 2014, total loans to employees under this program were $1.1 million, consisting of $0.8 million included in Other receivables - unrelated parties and $0.3 million included in Advance payments and others - unrelated parties in the accompanying condensed unaudited consolidated balance sheets. | |||||||
-3 | Beijing Henglong declared a dividend with a total amount of approximately $1 million, of which $0.5 million was payable to the Company. | |||||||
Assets_held_for_sale
Assets held for sale | 9 Months Ended | |
Sep. 30, 2014 | ||
Asset Held For Sale Current [Abstract] | ' | |
Disclosure of assets held for sale [Text Block] | ' | |
9 | Assets held for sale | |
According to the agreement signed between the Company and Jingzhou Land Reserve Center (“JLRC”), a local PRC government bureau, the Company has agreed to transfer the land use rights over 136,392 square meters of a piece of land in total located at Jingzhou city, Hubei Province, the PRC, to JLRC for total consideration of approximately $13.0 million. The collection of the consideration was subject to JLRC’s completion of its sale of such land use rights to be tendered in the open market. | ||
In the third quarter of 2013, the Company recognized and received consideration of $4.6 million upon the completion of the sale of the first portion of the land use rights by JLRC. As of December 31, 2013, the balance of assets held for sale represented the remaining land use rights to be sold within the 12 months following such date. | ||
In April 2014, JLRC successfully sold the remaining land use rights through an open tender. The consideration for the remaining land use rights was approximately $8.4 million, of which $6.5 million has been received by the Company as of September 30, 2014 and the remaining $1.9 million was recorded in accounts and notes receivable in the accompanying condensed unaudited consolidated balance sheets. Accordingly, the Company recorded $7.5 million for the sale of the rest of the land use rights as gain on other sales in the accompanying condensed unaudited consolidated statements of operations and comprehensive income. | ||
Long_term_investments
Long term investments | 9 Months Ended | |
Sep. 30, 2014 | ||
Long-term Investments [Abstract] | ' | |
Long Term Investments [Text Block] | ' | |
10 | Long term investments | |
As of September 30, 2014 and December 31, 2013, the Company’s balance of long-term investment was $3.7 million and $4.0 million, respectively. For the long-term investments in which the Company has no voting control, such investments were accounted for using the equity method or cost method. | ||
On January 24, 2010, the Company invested $3.1 million to establish a fifty-fifty joint venture company, Beijing Henglong, with an unrelated party. The Company accounts for its operating results with the equity method of accounting. Beijing Henglong declared a dividend with total amount of $1 million, of which $0.5 million was payable to the Company. As a result, the Company recorded dividend receivables of $0.5 million, which was applied as a reduction of the carrying value of the long-term investment. | ||
The Company’s share of net assets and net income is reported as “long-term investment” on the condensed unaudited consolidated balance sheets and “equity in earnings of affiliated companies” on the condensed unaudited consolidated statements of operations and comprehensive income. The Company’s condensed unaudited consolidated financial statements reflect the equity earnings of non-consolidated affiliates of $0.2 million and $0.3 million for the nine months ended September 30, 2014 and 2013, respectively. | ||
Property_plant_and_equipment_n
Property, plant and equipment, net | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
Property, Plant and Equipment Disclosure [Text Block] | ' | |||||||
11 | Property, plant and equipment, net | |||||||
The Company’s property, plant and equipment as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Land use rights and buildings | $ | 47,141 | $ | 43,849 | ||||
Machinery and equipment | 116,592 | 110,322 | ||||||
Electronic equipment | 7,590 | 7,414 | ||||||
Motor vehicles | 4,043 | 3,195 | ||||||
Construction in progress | 5,976 | 5,133 | ||||||
Total amount of property, plant and equipment (1) | 181,342 | 169,913 | ||||||
Less: Accumulated depreciation (2) | -99,632 | -89,895 | ||||||
Total amount of property, plant and equipment, net (3) | $ | 81,710 | $ | 80,018 | ||||
-1 | Through the acquisition of Fujian Qiaolong in the second quarter of 2014, the Company acquired $3.7 million of property, plant and equipment, consisting of $3.4 million of land use rights and buildings, $0.2 million of machinery and equipment, and $0.1 million of motor vehicles, which are depreciated over a weighted average life of 43.0 years, 3.5 years, and 3.1 years, respectively. | |||||||
-2 | Depreciation charges were $3.7 million and $3.7 million for the three months ended September 30, 2014 and 2013, respectively, and $11.4 million and $10.8 million for the nine months ended September 30, 2014 and 2013, respectively. | |||||||
-3 | As of September 30, 2014 and December 31, 2013, the Company had pledged property, plant and equipment with net book value of $46.8 million and $51.4 million, respectively, for its comprehensive credit facilities with banks in China. | |||||||
Intangible_assets
Intangible assets | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||
Intangible Assets Disclosure [Text Block] | ' | |||||||
12 | Intangible assets | |||||||
The Company’s intangible assets as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Costs: | ||||||||
Patent technology | $ | 3,073 | $ | 2,067 | ||||
Management software license | 784 | 699 | ||||||
Total intangible assets (1) | 3,857 | 2,766 | ||||||
Less: Amortization (2) | -2,285 | -2,080 | ||||||
Total intangible assets, net | $ | 1,572 | $ | 686 | ||||
-1 | Through the acquisition of Fujian Qiaolong in the second quarter of 2014, the Company acquired $0.9 million of intangible assets, consisting of $0.9 million of patent technology and $nil of management software licenses, which are amortized over a weighted average life of 4.7 years and 1.1 years, respectively. | |||||||
-2 | Amortization expenses were $0.1 million and $0.04 million for the three months ended September 30, 2014 and 2013, respectively, and $0.2 million and $0.1 million for the nine months ended September 30, 2014 and 2013, respectively. | |||||||
Deferred_income_tax_assets
Deferred income tax assets | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Income Tax Disclosure [Abstract] | ' | |||||||
Deferred Income Tax Disclosure [Text Block] | ' | |||||||
13 | Deferred income tax assets | |||||||
In accordance with the provisions of ASC Topic 740, “Income Taxes,” the Company assesses, on a quarterly basis, its ability to realize its deferred tax assets. Based on the more likely than not standard in the guidance and the weight of available evidence, the Company believes a valuation allowance against its deferred tax assets is necessary. In determining the need for a valuation allowance, the Company considered the following significant factors: an assessment of recent years’ profitability and losses by tax authorities; the Company’s expectation of profits based on margins and volumes expected to be realized, which are based on current pricing and volume trends; the long period in all significant operating jurisdictions before the expiry of net operating losses, noting further that a portion of the deferred tax asset is composed of deductible temporary differences that are subject to an expiry period until realized under tax law. The Company will continue to evaluate the provision of valuation allowance in future periods. | ||||||||
The components of estimated deferred income tax assets as of September 30, 2014 and December 31, 2013 are as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Losses carry forward (U.S.) (1) | $ | 7,047 | $ | 6,825 | ||||
Losses carry forward (PRC) (1) | 2,126 | 1,838 | ||||||
Product warranties and other reserves | 4,421 | 4,207 | ||||||
Property, plant and equipment | 4,558 | 4,346 | ||||||
Share-based compensation | 266 | 296 | ||||||
Bonus accrual | 359 | 557 | ||||||
Other accruals | 992 | 850 | ||||||
Others | 1,036 | 1,103 | ||||||
Total deferred tax assets | 20,805 | 20,022 | ||||||
Less: taxable temporary difference related to revenue recognition | -389 | -793 | ||||||
Total deferred tax assets, net | 20,416 | 19,229 | ||||||
Less: Valuation allowance | -9,237 | -8,918 | ||||||
Total deferred tax assets, net of valuation allowance (2) | $ | 11,179 | $ | 10,311 | ||||
-1 | The net operating losses carry forward for the U.S. entity for income tax purpose are available to reduce future years' taxable income. These losses will expire, if not utilized, in 20 years. Net operating losses carry forward for non-U.S. entities can be carried forward for 5 years to offset taxable income. However, as of September 30, 2014 and December 31, 2013, the valuation allowance was $9.2 million and $8.9 million, respectively, including $7.3 million and $7.3 million, respectively, allowance for the Company’s deferred tax assets in the United States and $1.9 million and $1.7 million, respectively, allowance for the Company’s non-U.S. deferred tax assets. Based on the Company’s current operations in the United States, management believes that the deferred tax assets in the United States are not likely to be realized in the future. For the non-U.S. deferred tax assets, pursuant to certain tax laws and regulations in China, the management believes such amount will not be used to offset future taxable income. | |||||||
-2 | Approximately $4.8 million and $4.5 million of net deferred income tax asset as of September 30, 2014 and December 31, 2013, respectively, are included in non-current deferred tax assets in the accompanying condensed unaudited consolidated balance sheets. The remaining $6.4 million and $5.8 million of net deferred income tax assets as of September 30, 2014 and December 31, 2013, respectively, are included in current deferred tax assets. | |||||||
Bank_and_government_loans_net
Bank and government loans, net | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
Short-term Debt [Text Block] | ' | |||||||
14 | Bank and government loans, net | |||||||
Loans consist of the following as of September 30, 2014 and December 31, 2013 (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Short-term bank loan (1) (2) | $ | 5,689 | $ | 7,381 | ||||
Short-term bank loan (3) (4) | 35,000 | 30,000 | ||||||
Short-term government loan (5) | 4,876 | - | ||||||
Subtotal | 45,565 | 37,381 | ||||||
Debt issue cost | - | -57 | ||||||
Amortization | - | 57 | ||||||
Bank and government loans, net | $ | 45,565 | $ | 37,381 | ||||
-1 | These loans are secured by property, plant and equipment of the Company and are repayable within one year (See Note 11). As of September 30, 2014 and December 31, 2013, the weighted average interest rate was 6.65% and 6.22% per annum, respectively. Interest is paid on the twentieth day of each month and the principal repayment is at maturity. | |||||||
-2 | On July 18, 2013, Jiulong entered into a one-year loan agreement with China Construction Bank Jingzhou branch in the amount of $1.6 million. The agreement contains certain financial and non-financial covenants, including but not limited to restrictions on the utilization of the funds and the maintenance of an asset-liability ratio not exceeding 60%. The loan was repaid on July 17, 2014. | |||||||
-3 | On May 18, 2012, the Company entered into a credit facility agreement, the “Credit Agreement,” with ICBC Macau to obtain a non-revolving credit facility in the amount of $30.0 million, the “Credit Facility”. The Credit Facility would have expired on November 3, 2012 unless the Company drew down the line of credit in full prior to such expiration date, and the maturity date for the loan drawdown was the earlier of (i) 18 months from the drawdown or (ii) 1 month before the expiry of the standby letter of credit obtained by Henglong from ICBC Jingzhou as security for the Credit Facility, the “Henglong Standby Letter of Credit”. The interest rate of the Credit Facility is calculated based on a three-month LIBOR plus 2.25% per annum, subject to the availability of funds and fluctuation at ICBC Macau’s discretion. The interest is calculated daily based on a 360-day year and it is fixed one day before the first day of each interest period. The interest period is defined as three months from the date of drawdown. As security for the Credit Facility, the Company was required to provide ICBC Macau with the Henglong Standby Letter of Credit for a total amount not less than $31.6 million if the Credit Facility is fully drawn. | |||||||
On May 22, 2012, the Company drew down the full amount of $30.0 million under the Credit Facility and provided the Henglong Standby Letter of Credit for an amount of $31.6 million in favor of ICBC Macau. The Henglong Standby Letter of Credit issued by ICBC Jingzhou is collateralized by Henglong’s notes receivable of RMB197.8 million (equivalent to approximately $32.2 million). The Company also paid an arrangement fee of $0.1 million to ICBC Macau and $0.1 million to ICBC Jingzhou. The original maturity date of the Credit Facility was May 22, 2013. | ||||||||
On May 7, 2013, ICBC Macau agreed to extend the maturity date of the Credit Facility to May 13, 2014. The interest rate of the Credit Facility under the extended term is revised as the three-month LIBOR plus 2.0% per annum, Except for the above, all other terms and conditions as stipulated in the Credit Agreement remain unchanged. | ||||||||
On May 13, 2014, ICBC Macau agreed to extend the maturity date of the Credit Facility to May 12, 2015. The interest rate of the Credit Facility under the extended term is revised as the three-month LIBOR plus 2.55% per annum. Except for the above, all other terms and conditions as stipulated in the Credit Agreement remain unchanged. As of September 30, 2014, the interest rate of the Credit Facility was 2.80% per annum (See Note 6). | ||||||||
-4 | On July 16, 2014, Great Genesis entered into a credit facility agreement with HSBC HK to obtain a non-revolving credit facility in the amount of $5.0 million, the “HSBC Credit Facility”. The HSBC Credit Facility will expire on July 1, 2015, and has an annual interest rate of 1.7%. Interest is paid on the twentieth day of each month and the principal repayment is at maturity. As security for the HSBC Credit Facility, the Company’s subsidiary Hubei Henglong was required to provide HSBC HK with the Standby Letter of Credit for a total amount of not less than $5.4 million if the HSBC Credit Facility is fully drawn. | |||||||
On July 22, 2014, Great Genesis drew down a loan amounting to $5.0 million provided by HSBC HK and Hubei Henglong provided a Standby Letter of Credit for an amount of $5.4 million in favor of HSBC HK. Hubei Henglong’s Standby Letter of Credit was issued by HSBC Bank (China) Company Limited Wuhan branch and is collateralized by short-term investments of Hubei Henglong of RMB33.0 million (equivalent to approximately $5.4 million). | ||||||||
-5 | On March 28, 2014, the Company received a Chinese government loan of RMB30.0 million (equivalent to approximately $4.9 million), with an interest rate of 3% per annum, The government loan, will mature on March 15, 2015. Henglong has pledged RMB31.4 million (equivalent to approximately $5.1 million) of notes receivable as security for such government loan (See Note 6). | |||||||
Accounts_and_notes_payable
Accounts and notes payable | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Accounts and Notes Payable Disclosure [Abstract] | ' | |||||||
Accounts and Notes Payable Disclosure [Text Block] | ' | |||||||
15 | Accounts and notes payable | |||||||
The Company’s accounts and notes payable as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Accounts payable - unrelated parties | $ | 129,420 | $ | 120,202 | ||||
Notes payable - unrelated parties (1) | 73,977 | 78,217 | ||||||
Total accounts and notes payable - unrelated parties | 203,397 | 198,419 | ||||||
Total accounts and notes payable - related parties | 3,837 | 4,634 | ||||||
Total accounts and notes payable | $ | 207,234 | $ | 203,053 | ||||
-1 | Notes payable represent accounts payable in the form of bills of exchange whose acceptances are guaranteed and settlements are handled by banks. The Company has pledged cash deposits, notes receivable and certain property, plant and equipment to secure notes payable granted by banks. | |||||||
Accrued_expenses_and_other_pay
Accrued expenses and other payables | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
Accrued Expenses and Other Payables Disclosure [Abstract] | ' | ||||||||||
Accrued Expenses and Other Payables Disclosure [Text Block] | ' | ||||||||||
16 | Accrued expenses and other payables | ||||||||||
The Company’s accrued expenses and other payables as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | |||||||||||
September 30, | December 31, | ||||||||||
2014 | 2013 | ||||||||||
Accrued expenses | $ | 5,180 | $ | 4,980 | |||||||
Accrued interest | 125 | 85 | |||||||||
Other payables | 1,480 | 1,858 | |||||||||
Dividends payable to common shareholders (1) | 757 | - | |||||||||
Dividends payable to non-controlling interests (2) | 4,063 | 35 | |||||||||
Amount payable for acquisition of non-controlling interests (See Note 19) | 37,314 | - | |||||||||
Warranty reserves (3) | 24,421 | 22,104 | |||||||||
Total | $ | 73,340 | $ | 29,062 | |||||||
-1 | On May 27, 2014, the Company announced the payment of a special cash dividend of $0.18 per common share to the Company’s shareholders of record as of the close of business on June 26, 2014. As of September 30, 2014, dividends payable of $0.8 million remained unpaid. | ||||||||||
-2 | In accordance with the resolution of the board of directors of Henglong, in June 2014, Henglong declared a dividend amounting to $40.6 million to its shareholders, of which $8.1 million was payable to the holder of the non-controlling interests. As of September 30, 2014, dividends payable of $4.1 million have not yet been paid to the holder of the non-controlling interests. | ||||||||||
-3 | 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 nine months ended September 30, 2014 and 2013, and for the year ended December 31, 2013, the warranties activities were as follows (figures are in thousands of USD): | |||||||||||
Nine Months Ended September | Year Ended | ||||||||||
30, | December 31, | ||||||||||
2014 | 2013 | 2013 | |||||||||
Balance at beginning of the period | $ | 22,104 | $ | 18,081 | $ | 18,081 | |||||
Additions during the period | 8,333 | 8,554 | 12,707 | ||||||||
Settlement within period, by cash or actual material | -5,816 | -6,199 | -9,244 | ||||||||
Foreign currency translation gain (loss) | -200 | 404 | 560 | ||||||||
Balance at end of the period | $ | 24,421 | $ | 20,840 | $ | 22,104 | |||||
Taxes_payable
Taxes payable | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Taxes Payables [Abstract] | ' | |||||||
Taxes Payable [Text Block] | ' | |||||||
17 | Taxes payable | |||||||
The Company’s taxes payable as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Value-added tax payable | $ | 2,658 | $ | 5,494 | ||||
Income tax payable | 5,697 | 1,841 | ||||||
Other tax payable | 182 | 457 | ||||||
Total | $ | 8,537 | $ | 7,792 | ||||
Advances_payable
Advances payable | 9 Months Ended | |
Sep. 30, 2014 | ||
Payables and Accruals [Abstract] | ' | |
Advances Payable [Text Block] | ' | |
18 | Advances payable | |
As of September 30, 2014 and December 31, 2013, advances payable by the Company were $2.9 million and $2.8 million, respectively. | ||
The amounts are special subsidies made by the Chinese government to the Company to offset the cost and charges related to the improvement of production capacities and improvement of the quality of products. For the government subsidies with no further conditions to be met, the amounts are recorded as other income when received; for the amounts with certain operating conditions, the government subsidies are recorded as advances payable when received and will be recorded as a deduction of related expenses and cost of acquired assets when the conditions are met. | ||
The balances are unsecured, interest-free and will be repayable to the Chinese government if the usage of such advance does not continue to qualify for the subsidy. | ||
Additional_paidin_capital
Additional paid-in capital | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Additional Paid in Capital [Abstract] | ' | |||||||||||||||
Additional paid-in capital [Text Block] | ' | |||||||||||||||
19 | Additional paid-in capital | |||||||||||||||
The Company’s positions in respect of the amounts of additional paid-in capital for the nine months ended September 30, 2014 and 2013, and the year ended December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||||||||||
Year Ended | ||||||||||||||||
Nine Months Ended September 30, | December 31, | |||||||||||||||
2014 | 2013 | 2013 | ||||||||||||||
Balance at beginning of the period | $ | 39,565 | $ | 39,371 | $ | 39,371 | ||||||||||
Return of common shareholders’ investment cost (1) | -5,047 | - | - | |||||||||||||
Acquisition of the non-controlling interests in Henglong and Jiulong (2) | -7,502 | - | - | |||||||||||||
Share-based compensation (3) | 193 | 194 | 194 | |||||||||||||
Balance at end of the period | $ | 27,209 | $ | 39,565 | $ | 39,565 | ||||||||||
-1 | On May 27, 2014, the Company announced a special cash dividend of $0.18 per common share to the Company’s shareholders of record as of the close of business on June 26, 2014. As China Automotive Systems, the parent company, had an accumulated deficit position as of the date of the dividend declaration, the dividends distributed to the Company’s common shareholders described above are treated as a return of common shareholders’ investment cost. | |||||||||||||||
-2 | On August 11, 2014, the Company entered into the Exchange Agreement with Jiulong Machinery Electricity, under which the Company issued 3,260,000 and 818,000 of its common shares in consideration for the acquisition of the 20% and 19% equity interests in Henglong and Jiulong, respectively, held by Jiulong Machinery Electricity. On September 26, 2014, the Company obtained the 20% and 19% equity interests in Henglong and Jiulong, respectively, and completed its share registrations with the local government administrative bureau. The Company owned 100% of the equity interests in both Henglong and Jiulong as of September 30, 2014. The Company’s acquisitions of the non-controlling interests were accounted for as equity transactions in the quarter ended September 30, 2014. The total carrying value for the non-controlling interests in both Henglong and Jiulong was $34.5 million, including the accumulated other comprehensive income of $4.7 million related to the noncontrolling interests acquired. Therefore, the total carrying value of $34.5 million for the non-controlling interests acquired was reclassified from non-controlling interests to the controlling interest’s equity as of September 30, 2014. The fair market value of the Company’s common stock issued was $37.3 million or $9.15 per share, which was determined on the issuance date of the common shares. The difference between the fair market value of $37.3 million for the Company’s common shares issued and the carrying value of $34.5 million for the non-controlling interest acquired of $2.8 million was recorded as a reduction of additional paid-in capital. Additional paid-in capital of the Company was also decreased by $4.7 million and the accumulated other comprehensive income attributable to Henglong and Jiulong was increased by a corresponding amount. | |||||||||||||||
On October 13, 2014, the Company completed its issuance of 4,078,000 common shares to nominee holders designated by Jiulong Machinery Electricity (See Note 32). | ||||||||||||||||
-3 | On September 16, 2014 and August 13, 2013, the Company granted 22,500 and 22,500 stock options, respectively, to the Company’s independent directors, with the exercise price equal to the closing price of the Company’s common stock traded on NASDAQ on the date of grant. The fair value of stock options was determined at the date of grant using the Black-Scholes option pricing model. The Black-Scholes option model requires management to make various estimates and assumptions, including expected term, expected volatility, risk-free rate and dividend yield. The expected term represents the period of time that stock-based compensation awards granted are expected to be outstanding and is estimated based on considerations including the vesting period, contractual term and anticipated employee exercise patterns. Expected volatility is based on the historical volatility of the Company’s stock. The risk-free rate is based on the U.S. Treasury yield curve in relation to the contractual life of stock-based compensation instruments. The dividend yield assumption is based on historical patterns and future expectations for the Company’s dividends. | |||||||||||||||
Assumptions used to estimate the fair value of stock options on the grant dates are as follows: | ||||||||||||||||
Issuance Date | Expected volatility | Risk-free rate | Expected term (years) | Dividend yield | ||||||||||||
16-Sep-14 | 120.6 | % | 1.78 | % | 5 | 0 | % | |||||||||
13-Aug-13 | 131.5 | % | 1.49 | % | 5 | 0 | % | |||||||||
The above stock options were vested and exercisable immediately. Their fair value on the grant dates of September 16, 2014 and August 13, 2013 using the Black-Scholes option pricing model was $0.2 million and $0.2 million, respectively. During the nine months ended September 30, 2014 and 2013, the Company recognized stock-based compensation expenses of $0.2 million and $0.2 million, respectively. | ||||||||||||||||
Retained_earnings
Retained earnings | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
Retained Earnings Disclosure [Abstract] | ' | ||||||||||
Retained Earnings Disclosure [Text Block] | ' | ||||||||||
20 | Retained earnings | ||||||||||
Appropriated | |||||||||||
Pursuant to the relevant PRC laws and regulations, the profits distribution of the Company’s PRC subsidiaries, which are based on their PRC statutory financial statements, rather than the financial statement that was prepared in accordance with U.S. GAAP, 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%. | |||||||||||
When the statutory surplus reserve reaches 50% of the registered capital of a company, additional reserve is no longer required. However, the reserve cannot be distributed to venture partners. Based on the business licenses of the PRC subsidiaries, the registered capital of Henglong, Jiulong, Shenyang, Jielong, Wuhu, Hubei Henglong and Chongqing are $10.0 million, $4.2 million (equivalent to RMB35.0 million), $8.1 million (equivalent to RMB67.5 million), $6.0 million, $3.8 million (equivalent to RMB30.0 million), $39 million and $9.5 million (equivalent to RMB60.0 million), respectively, and the registered capital of USAI is $2.6 million. | |||||||||||
The Company’s activities in respect of the amounts of the appropriated retained earnings for the nine months ended September 30, 2014 and 2013, and the year ended December 31, 2013 are summarized as follows (figures are in thousands of USD): | |||||||||||
Year Ended | |||||||||||
Nine Months Ended September 30, | December 31, | ||||||||||
2014 | 2013 | 2013 | |||||||||
Balance at beginning of the period | $ | 10,048 | $ | 9,953 | $ | 9,953 | |||||
Appropriation of retained earnings | 130 | 95 | 95 | ||||||||
Balance at end of the period | $ | 10,178 | $ | 10,048 | $ | 10,048 | |||||
Unappropriated | |||||||||||
The Company’s activities in respect of the amounts of the unappropriated retained earnings for the nine months ended September 30, 2014 and 2013, and the year ended December 31, 2013 are summarized as follows (figures are in thousands of USD): | |||||||||||
Nine Months Ended September | Year Ended | ||||||||||
30, | December 31, | ||||||||||
2014 | 2013 | 2013 | |||||||||
Balance at beginning of the period | $ | 146,023 | $ | 119,329 | $ | 119,329 | |||||
Net income attributable to parent company | 24,514 | 19,544 | 26,789 | ||||||||
Appropriation of retained earnings | -130 | -95 | -95 | ||||||||
Balance at end of the period | $ | 170,407 | $ | 138,778 | $ | 146,023 | |||||
Accumulated_other_comprehensiv
Accumulated other comprehensive income | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
Equity [Abstract] | ' | ||||||||||
Other Comprehensive Income, Noncontrolling Interest [Text Block] | ' | ||||||||||
21 | Accumulated other comprehensive income | ||||||||||
The Company’s activities in respect of the amounts of the accumulated other comprehensive income for the nine months ended September 30, 2014 and 2013, and the year ended December 31, 2013 are summarized as follows (figures are in thousands of USD): | |||||||||||
Nine Months Ended September | Year Ended | ||||||||||
30, | December 31, | ||||||||||
2014 | 2013 | 2013 | |||||||||
Balance at beginning of the period | $ | 32,061 | $ | 25,898 | $ | 25,898 | |||||
Other comprehensive income related to the non-controlling interests acquired by the Company (See Note 19) | 4,743 | - | - | ||||||||
Foreign currency translation adjustment attributable to parent company | -2,010 | 4,374 | 6,163 | ||||||||
Balance at end of the period | $ | 34,794 | $ | 30,272 | $ | 32,061 | |||||
Noncontrolling_interests
Non-controlling interests | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
Noncontrolling Interest [Abstract] | ' | ||||||||||
Noncontrolling Interest Disclosure [Text Block] | ' | ||||||||||
22 | Non-controlling interests | ||||||||||
The Company’s activities in respect of the amounts of the non-controlling interests’ equity for the nine months ended September 30, 2014 and 2013, and the year ended December 31, 2013 are summarized as follows (figures are in thousands of USD): | |||||||||||
Nine Months Ended September | Year Ended | ||||||||||
30, | December 31, | ||||||||||
2014 | 2013 | 2013 | |||||||||
Balance at beginning of the period | $ | 45,071 | $ | 38,846 | $ | 38,846 | |||||
Fair value of the non-controlling interests arising from the acquisition of Fujian Qiaolong (1) | 2,793 | - | - | ||||||||
Acquisition of the non-controlling interests in Henglong and Jiulong (See Note 19) | -29,812 | - | - | ||||||||
Other comprehensive income related to the non-controlling interests acquired by the Company (See Note 19) | -4,743 | - | - | ||||||||
Income attributable to non-controlling interests | 5,409 | 4,616 | 6,276 | ||||||||
Dividends declared to the non-controlling interest holders of joint-venture companies (See Note 16) | -10,077 | -1,299 | -1,299 | ||||||||
Foreign currency translation adjustment attributable to non-controlling interests | -403 | 892 | 1,248 | ||||||||
Balance at end of the period | $ | 8,238 | $ | 43,055 | $ | 45,071 | |||||
-1 | In the second quarter of 2014, the Company acquired a 51.0% equity interest in Fujian Qiaolong (See Note 3). The fair value of the non-controlling interest of Fujian Qiaolong is $2.8 million. | ||||||||||
Gain_on_other_sales
Gain on other sales | 9 Months Ended | |
Sep. 30, 2014 | ||
Gain on other sales [Abstract] | ' | |
Gain on other sales [Text Block] | ' | |
23 | Gain on other sales | |
Gain on other sales mainly consisted of net amount retained from sales of materials, property, plant and equipment, land use rights, and scraps. In the second quarter of 2014, the Company sold the remaining land use rights (See Note 9) and recognized a gain of $7.5 million, which represented the difference between the selling price of $8.4 million and the net book value of the land use rights of $0.9 million. In the third quarter of 2013, the Company sold part of its land use rights and recognized a gain of $ 4.1 million, which represented the difference between the selling price of $ 4.6 million and the net book value of the land use rights of $ 0.5 million. | ||
Financial_income_net
Financial income, net | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Financial Income Expenses Disclosure [Abstract] | ' | |||||||
Financial Income Expenses Disclosure [Text Block] | ' | |||||||
24 | Financial income, net | |||||||
During the three months and nine months ended September 30, 2014 and 2013, the Company recorded financial income, net which is summarized as follows (figures are in thousands of USD): | ||||||||
Three Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Interest expense | $ | -728 | $ | -284 | ||||
Interest income | 1,404 | 1,143 | ||||||
Foreign exchange loss, net | -63 | -24 | ||||||
Gain of cash discount, net | 3 | 3 | ||||||
Bank fees | -204 | -149 | ||||||
Total financial income, net | $ | 412 | $ | 689 | ||||
Nine Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Interest expense | $ | -1,552 | $ | -1,289 | ||||
Interest income | 2,657 | 2,298 | ||||||
Foreign exchange loss, net | -62 | -71 | ||||||
Gain (loss) of cash discount, net | 65 | -9 | ||||||
Bank fees | -510 | -549 | ||||||
Total financial income, net | $ | 598 | $ | 380 | ||||
Income_tax_rate
Income tax rate | 9 Months Ended | |
Sep. 30, 2014 | ||
Income Tax Disclosure [Abstract] | ' | |
Income Tax Disclosure [Text Block] | ' | |
25 | Income tax rate | |
The Company’s subsidiaries registered in the PRC are subject to state and local income taxes within the PRC at the applicable tax rate of 25% on the taxable income as reported in their PRC statutory financial statements in accordance with the relevant income tax laws applicable to foreign invested enterprise, unless preferential tax treatment is granted by local tax authorities. If the enterprise meets certain preferential terms according to the China income tax law, such as assessment as a “High & New Technology Enterprise” by the government, then, the enterprise will be subject to enterprise income tax at a rate of 15%. | ||
Pursuant to the New China Income Tax Law and the Implementing Rules (“New CIT”) which became effective as of January 1, 2008, dividends generated after January 1, 2008 and payable by a foreign-invested enterprise to its foreign investors will be subject to a 10% withholding tax if the foreign investors are considered as non-resident enterprises without any establishment or place within China or if the dividends payable have no connection with the establishment or place of the foreign investors within China, unless any such foreign investor’s jurisdiction of incorporation has a tax treaty with China that provides for a different withholding arrangement. | ||
Genesis, the Company’s wholly-owned subsidiary and the direct holder of the equity interests in the Company’s subsidiaries in China, is incorporated in Hong Kong. According to the Mainland China and Hong Kong Taxation Arrangement, dividends paid by a foreign-invested enterprise in China to its direct holding company in Hong Kong will be subject to withholding tax at a rate of no more than 5%, if the foreign investor owns directly at least 25% of the shares of the foreign-invested enterprise. Under the New CIT, if Genesis is regarded as a non-resident enterprise and therefore is required to pay an additional 5% withholding tax for any dividends payable to it from the PRC subsidiaries. | ||
According to PRC tax regulation, the Company should withhold income taxes for the profit distributed from the PRC subsidiaries to Genesis, the subsidiaries’ holding company incorporated in Hong Kong. For the profit that the PRC subsidiaries intended to distribute to Genesis, the Company accrues the withholding income tax as deferred tax liabilities. As of September 30, 2014, the Company has recognized deferred tax liabilities of $0.17 million for the remaining undistributed profits to Genesis of $3.5 million. The Company intended to re-invest the remaining undistributed profits generated from the PRC subsidiaries in those subsidiaries permanently. As of September 30, 2014 and December 31, 2013, the Company still has undistributed earnings of approximately $178.5 million and $158.5 million, respectively, from investment in the PRC subsidiaries that are considered permanently reinvested. Had the undistributed earnings been distributed to Genesis and not permanently reinvested, the tax provision as of September 30, 2014 and December 31, 2013 of approximately $8.9 million and $7.9 million, respectively, would have been recorded. Such undistributed profits will be reinvested in Genesis and not further distributed to the parent company incorporated in the United States going forward. | ||
During 2008, Jiulong was awarded the title of “High & New Technology Enterprise” and, based on the PRC income tax law, it was subject to enterprise income tax at a rate of 15% for 2008, 2009 and 2010. In 2011, the Company passed the re-assessment of the government based on PRC income tax laws. Accordingly, the Company continued to be taxed at the 15% tax rate in 2011, 2012 and 2013. The Company estimated the applied tax rate in 2014 to be 15% as it will probably pass the re-assessment in 2014 and continue to qualify as “High & New Technology Enterprise”. | ||
During 2008, Henglong was awarded the title of “High & New Technology Enterprise” and, based on the PRC income tax law, it was subject to enterprise income tax at a rate of 15% for 2008, 2009 and 2010. In 2011, the Company passed the re-assessment of the government, based on PRC income tax laws. Accordingly, it continued to be taxed at the 15% tax rate in 2011, 2012 and 2013. The Company estimated the applied tax rate in 2014 to be 15% as it will probably pass the re-assessment in 2014 and continue to qualify as “High & New Technology Enterprise”. | ||
During 2009, Shenyang was awarded the title of “High & New Technology Enterprise” and, based on the PRC income tax law, it was subject to enterprise income tax at a rate of 15% for 2009, 2010 and 2011. In 2012, the Company passed the re-assessment of the government based on PRC income tax laws. Accordingly, it will continue to be taxed at the 15% tax rate in 2012, 2013 and 2014. | ||
During 2013, Jielong was awarded the title of “High & New Technology Enterprise” and, based on the PRC income tax law, it is subject to enterprise income tax at a rate of 15% for 2013, 2014 and 2015. | ||
According to the New CIT, Hubei Henglong has been subject to tax at a rate of 12.5% from 2010 to 2012. In November 2011, Hubei Henglong was awarded the title of “High & New Technology Enterprise”, based on the PRC income tax law. Accordingly, it will be subject to enterprise income tax at a rate of 15% for 2013. The Company estimated the applied tax rate in 2014 to be 15% as it will probably pass the re-assessment in 2014 and continue to qualify as “High & New Technology Enterprise”. | ||
According to the New CIT, USAI and Testing Center were exempted from income tax in 2009, and each has been subject to income tax at a rate of 12.5% in 2010 and 2011, and 25% in 2012, 2013 and 2014. | ||
Chongqing Henglong was established in 2012. According to the New CIT, Chongqing Henglong is subject to income tax at a uniform rate of 25%. No provision for Chongqing Henglong is made as it had no assessable income for the three months and nine months ended September 30, 2014 and 2013. | ||
Based on Brazilian income tax laws, Brazil Henglong is subject to income tax at a uniform rate of 15%, and a resident legal person is subject to additional tax at a rate of 10% for the part of taxable income over $0.12 million (equivalent to BRL 0.24 million). The Company had no assessable income in Brazil for the three months and nine months ended September 30, 2014 and 2013. | ||
Fujian Qiaolong was acquired in the second quarter of 2014. In November 2011, Fujian Qiaolong was awarded the title of “High & New Technology Enterprise” and, based on the PRC income tax law, it was subject to enterprise income tax at a rate of 15% for 2011, 2012 and 2013. In 2014, the Company passed the re-assessment of the government based on PRC income tax laws. Accordingly, it will continue to be taxed at the 15% tax rate in 2014, 2015 and 2016. No provision for Fujian Qiaolong is made as it had no assessable income for the three months and nine months ended September 30, 2014. | ||
The profits tax rate of Hong Kong is 16.5%. No provision for Hong Kong tax is made as Genesis is an investment holding company, and had no assessable income in Hong Kong for the three months and nine months ended September 30, 2014 and 2013. | ||
The enterprise income tax rate of the United States is 35%. No provision for U.S. tax is made for HLUSA as HLUSA had no assessable income in the United States for the three months and nine months ended September 30, 2013. HLUSA made a provision for assessable income for the three months and nine months ended September 30, 2014. | ||
The enterprise income tax rate of the United States is 35%. No provision for U.S. tax is made for the Company as the Company had no assessable income in the United States for the three months and nine months ended September 30, 2014 and 2013. | ||
The effective tax rate was 14.9% and 17.9% for the three months and nine months ended September 30, 2014, compared with 15.3% and 17.8% for the three months and nine months ended September 30, 2013. | ||
Income_per_share
Income per share | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
Earnings Per Share [Text Block] | ' | |||||||
26 | Income per share | |||||||
Basic income per share is calculated by dividing net income by the weighted average number of common shares outstanding during the period. Diluted income per share is calculated 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 calculation of basic and diluted income per share attributable to the parent company for the three months ended September 30, 2014 and 2013, were (figures are in thousands of USD , except share and per share amounts): | ||||||||
Three Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Numerator: | ||||||||
Net income attributable to the parent company’s common shareholders – Basic and Diluted | $ | 6,733 | $ | 8,624 | ||||
Denominator: | ||||||||
Weighted average shares outstanding | 28,043,019 | 28,043,019 | ||||||
Dilutive effects of stock options | 20,642 | 19,278 | ||||||
Denominator for dilutive income per share – Diluted | 28,063,661 | 28,062,297 | ||||||
Net income per share attributable to parent company’s common shareholders – Basic | $ | 0.24 | $ | 0.31 | ||||
Net income per share attributable to parent company’s common shareholders – Diluted | $ | 0.24 | $ | 0.31 | ||||
As of September 30, 2014 and 2013, the exercise prices for 60,000 shares and 60,000 shares, respectively, of outstanding stock options were above the weighted average market price of the Company’s common stock during the three months ended September 30, 2014 and 2013, respectively, and these stock options were excluded from the calculation of the diluted income per share for the corresponding periods presented. | ||||||||
The calculations of basic and diluted income per share attributable to the parent company for the nine months ended September 30, 2014 and 2013, were (figures are in thousands of USD , except share and per share amounts ): | ||||||||
Nine Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Numerator: | ||||||||
Net income attributable to the parent company’s common shareholders – Basic and Diluted | $ | 24,514 | $ | 19,544 | ||||
Denominator: | ||||||||
Weighted average shares outstanding | 28,043,019 | 28,043,019 | ||||||
Dilutive effects of stock options | 20,827 | 10,989 | ||||||
Denominator for dilutive income per share – Diluted | 28,063,846 | 28,054,008 | ||||||
Net income per share attributable to parent company’s common shareholders – Basic | $ | 0.87 | $ | 0.7 | ||||
Net income per share attributable to parent company’s common shareholders – Diluted | $ | 0.87 | $ | 0.7 | ||||
As of September 30, 2014 and 2013, the exercise prices for 60,000 shares and 50,000 shares, respectively, of outstanding stock options were above the weighted average market price of the Company’s common stock during the nine months ended September 30, 2014 and 2013, respectively, and these stock options were excluded from the calculation of the diluted income per share for the corresponding periods presented. | ||||||||
Significant_concentrations
Significant concentrations | 9 Months Ended | |
Sep. 30, 2014 | ||
Risks and Uncertainties [Abstract] | ' | |
Concentration Risk Disclosure [Text Block] | ' | |
27 | 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 exchange for settlement of such "current account" transactions without pre-approval. However, pursuant to applicable regulations, foreign-invested enterprises in China may pay dividends only out of their accumulated profits, if any, determined in accordance with the PRC law. In calculating accumulated profits, foreign investment enterprises in China are required to allocate at least 10% of their annual net income each year, if any, to fund certain reserve funds, including mandated employee benefits funds, unless these reserves have reached 50% of the registered capital of the enterprises. | ||
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 USD, 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 PRC, the Company’s PRC 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 PRC 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. | ||
The Company grants credit to its customers including Xiamen Joylon, Xiamen Automotive Parts, Shanghai Fenglong and Jiangling Yude, which are related parties of the Company. The Company’s customers are mostly located in the PRC. | ||
During the nine months ended September 30, 2014, the Company’s ten largest customers accounted for 68.0% of its consolidated net product sales, with one customer individually accounting for more than 10% of consolidated net sales, i.e., 12.1%. As of September 30, 2014, approximately 6.2% of accounts receivable were from trade transactions with the aforementioned one customer, and there was one other individual customer with a receivables balance of more than 10% of total accounts receivable, i.e. 12.9%. | ||
During the nine months ended September 30, 2013, the Company’s ten largest customers accounted for 73.2% of its consolidated net sales, with the largest customer individually accounting for more than 10% of consolidated net sales, i.e., 11.8%. As of September 30, 2013, approximately 3.2% of accounts receivable were from trade transactions with the aforementioned one customer, and there were no individual customers with a receivables balance of more than 10% of total accounts receivable. | ||
Related_party_transactions_and
Related party transactions and balances | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Related Party Transactions [Abstract] | ' | |||||||
Related Party Transactions Disclosure [Text Block] | ' | |||||||
28 | Related party transactions and balances | |||||||
Related party transactions are as follows (figures are in thousands of USD): | ||||||||
Related sales | ||||||||
Three Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Merchandise sold to related parties | $ | 11,890 | $ | 9,166 | ||||
Rental income obtained from related parties | 199 | - | ||||||
Materials sold to related parties | 657 | - | ||||||
Total | $ | 12,746 | $ | 9,166 | ||||
Nine Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Merchandise sold to related parties | $ | 38,627 | $ | 26,344 | ||||
Rental income obtained from related parties | 199 | - | ||||||
Materials sold to related parties | 657 | - | ||||||
Total | $ | 39,483 | $ | 26,344 | ||||
Related purchases | ||||||||
Three Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Materials purchased from related parties | $ | 6,069 | $ | 10,500 | ||||
Technology purchased from related parties | 114 | 58 | ||||||
Equipment purchased from related parties | 1,274 | 777 | ||||||
Total | $ | 7,457 | $ | 11,335 | ||||
Nine Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Materials purchased from related parties | $ | 20,721 | $ | 23,171 | ||||
Technology purchased from related parties | 278 | 575 | ||||||
Equipment purchased from related parties | 2,528 | 2,160 | ||||||
Total | $ | 23,527 | $ | 25,906 | ||||
Related receivables | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Accounts receivable | $ | 22,253 | $ | 17,194 | ||||
Other receivables | 48 | 108 | ||||||
Total | $ | 22,301 | $ | 17,302 | ||||
Related advances | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Advance equipment payment to related parties | $ | 2,391 | $ | 2,097 | ||||
Advance payments and others to related parties | 1,715 | 866 | ||||||
Total | $ | 4,106 | $ | 2,963 | ||||
Related payables | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Accounts payable | $ | 3,837 | $ | 4,634 | ||||
These transactions were consummated under similar terms as those with the Company's third party customers and suppliers. | ||||||||
Related parties pledged certain land use rights and buildings as security for the Company’s credit facilities provided by banks. | ||||||||
Loans to Related Parties | ||||||||
For the nine months ended September 30, 2013, certain of the Company’s subsidiaries provided short-term loans to related parties of the Company in the aggregate principal amount of $20.6 million (RMB126.6 million). The contractual period of each loan was three months or less from the date of the extension of the loan, including a loan of $14.1 million (RMB 87.0 million) with an annual interest rate of 5.6%. The loans to related parties were entered into for the purpose of assisting the borrowing entities in addressing certain cash flow needs. All of these loans qualified for net reporting in accordance with ASC 230 “Statement of Cash Flows”. As of September 30, 2013, all of these loans had been repaid to the Company. | ||||||||
For the three months and nine months ended September 30, 2014, there were no loan activities with related parties. | ||||||||
Three Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Loans to related parties | $ | - | $ | 19,922 | ||||
Nine Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Loans to related parties | $ | - | $ | 20,608 | ||||
As stated in the Company’s 2013 annual financial statements (See Note 28), the short-term loans entered into with related parties prior to September 30, 2013 were identified as related party transactions subsequent to December 31, 2013. These loans were not disclosed in the Company’s Form 10-Q for each of the three-month periods ended March 31, 2013 and September 30, 2013. The Company has evaluated the significance of this disclosure omission in the Form 10-Qs for previous periods and, in the opinion of management, the effect is not material to the Company’s condensed unaudited financial statements for any period previously reported. | ||||||||
As of November 12, 2014, Hanlin Chen, the Company’s Chairman, owns 55.6% 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 | 9 Months Ended | |||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||||||||||
Commitments and Contingencies Disclosure [Text Block] | ' | |||||||||||||||||||
29 | Commitments and contingencies | |||||||||||||||||||
Legal proceedings | ||||||||||||||||||||
Securities Action - Southern District of New York. On October 25, 2011, a purported securities class action was filed in the United States District Court for the Southern District of New York on behalf of all purchasers of the Company’s securities between March 25, 2010 and March 17, 2011. On February 24, 2012, the plaintiffs filed an amended complaint, changing the purported class period to between May 12, 2009 and March 17, 2011. The amended complaint alleged that the Company, certain of its present officers and directors, and the Company’s former independent accounting firm violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and the rules promulgated thereunder, and sought unspecified damages. The Company filed a motion to dismiss the amended complaint, which the court denied on August 8, 2012. On September 4, 2012, the Company filed an answer to the amended complaint. On January 15, 2013, plaintiffs filed a motion to certify the purported class, which the court denied on May 31, 2013. On July 17, 2013, plaintiffs filed a petition for permission to appeal the order denying class certification, and, on August 1, 2013, the Company filed an answer in opposition to the petition. On October 23, 2013, the Court of Appeals for the Second Circuit denied plaintiffs’ petition for permission to appeal. On December 6, 2013, plaintiffs filed a motion for preliminary approval of a settlement with the Company’s former independent accounting firm and certification of a proposed settlement class, which the district court denied on January 15, 2014. On March 28, 2014, the Company and plaintiffs entered into a settlement agreement. As part of the settlement, on April 29, 2014, the Company and plaintiffs filed a stipulation dismissing all claims by plaintiffs against the Company and its current and former officers and directors, with no admission of any wrongdoing or liability. On April 29, 2014, the court entered an order granting the dismissal. The settlement had no material effect on the condensed unaudited consolidated financial statements for the three months and nine months ended September 30, 2014. | ||||||||||||||||||||
Other than the above, the Company is not a party to any pending or, to the best of the Company’s knowledge, any threatened legal proceedings. In addition, 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 September 30, 2014 (figures are in thousands of USD): | ||||||||||||||||||||
Payment obligations by period | ||||||||||||||||||||
2014 (1) | 2015 | 2016 | 2017 | Thereafter | Total | |||||||||||||||
Interest on short-term bank loan | $ | 383 | $ | 606 | $ | - | $ | - | $ | - | $ | 989 | ||||||||
Obligations for investment contracts (2) | 813 | 1,625 | 3,251 | 2,438 | - | 8,127 | ||||||||||||||
Obligations for purchasing and service agreements | 3,715 | 4,538 | 96 | - | - | 8,349 | ||||||||||||||
Total | $ | 4,911 | $ | 6,769 | $ | 3,347 | $ | 2,438 | $ | - | $ | 17,465 | ||||||||
(1) Remaining 3 months in 2014. | ||||||||||||||||||||
(2) Capital Commitment to the Venture Fund | ||||||||||||||||||||
As disclosed in Note 1, on September 22, 2014, Hubei Henglong entered into an agreement with seven other parties to establish the Venture Fund, under which Hubei Henglong has committed to make investments of 17.9% or RMB 50.0 million (equivalent to approximately $8.1 million) into the Venture Fund in three installments. On October 20, 2014, Hubei Henglong made its first capital contribution of RMB 5 million (equivalent to approximately $0.8 million) (See Note 32). The remaining capital commitment of RMB 45 million (equivalent to approximately $7.3 million) will be paid upon capital calls received from the Venture Fund. | ||||||||||||||||||||
Offbalance_sheet_arrangements
Off-balance sheet arrangements | 9 Months Ended | |
Sep. 30, 2014 | ||
Off Balance Sheet Arrangements Disclosure [Abstract] | ' | |
Off Balance Sheet Arrangements Disclosure [Text Block] | ' | |
30 | Off-balance sheet arrangements | |
As of September 30, 2014 and December 31, 2013, the Company did not have any significant transactions, obligations or relationships that could be considered off-balance sheet arrangements. | ||
Segment_reporting
Segment reporting | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
Segment Reporting Disclosure [Text Block] | ' | |||||||||||||||
31 | Segment reporting | |||||||||||||||
The accounting policies of the product sectors are the same as those described in the summary of significant accounting policies 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. | ||||||||||||||||
As of September 30, 2014, the Company had 12 product sectors, five 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 and Hubei Henglong), and one holding company (Genesis). The other seven sectors were engaged in the production and sale of sensor modular (USAI), EPS (Jielong), provision of after sales and R&D services (HLUSA), production and sale of power steering (Chongqing Henglong), trade (Brazil Henglong), commercial vehicle repacking and sales (Fujian Qiaolong), and manufacture and sales of automobile electronic systems and parts (Wuhan Chuguanjie). Since the revenues, net income and net assets of these seven sectors collectively are less than 10% of consolidated revenues, net income and net assets, respectively, in the condensed unaudited consolidated financial statements, the Company incorporated these seven sectors into “Other Sectors.” | ||||||||||||||||
As of September 30, 2013, the Company had 10 product sectors, five 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 and Hubei Henglong), and one holding company (Genesis). The other five sectors were engaged in the production and sale of sensor modular (USAI), EPS (Jielong), provision of after sales and R&D services (HLUSA), production and sale of power steering (Chongqing Henglong) and trade (Brazil Henglong). Since the revenues, net income and net assets of these five sectors collectively are less than 10% of consolidated revenues, net income and net assets, respectively, in the condensed unaudited consolidated financial statements, the Company incorporated these five sectors into “Other Sectors.” | ||||||||||||||||
As discussed in Acquisition (See Note 3) above, the Company acquired a 51.0% equity interest in Fujian Qiaolong in the second quarter of 2014. The results of Fujian Qiaolong have been included since the date of acquisition and are reflected in Other Sectors in the Company’s segment reporting. | ||||||||||||||||
The Company’s product sector information for the three months and nine months ended September 30, 2014 and 2013, is as follows (figures are in thousands of USD): | ||||||||||||||||
Net Product Sales | Net Income (Loss) | |||||||||||||||
Three Months Ended September | Three Months Ended September | |||||||||||||||
30, | 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Henglong | $ | 60,902 | $ | 55,846 | $ | 5,127 | $ | 8,368 | ||||||||
Jiulong | 15,964 | 16,692 | 168 | 279 | ||||||||||||
Shenyang | 8,988 | 9,095 | 998 | 603 | ||||||||||||
Wuhu | 5,941 | 4,948 | -88 | -145 | ||||||||||||
Hubei Henglong | 14,425 | 11,783 | 1,110 | 6,092 | -1 | |||||||||||
Other Sectors | 9,887 | 7,558 | 252 | 522 | ||||||||||||
Total Segments | 116,107 | 105,922 | 7,567 | 15,719 | ||||||||||||
Corporate | - | - | 231 | 309 | ||||||||||||
Eliminations | -14,372 | -15003 | 228 | -5,599 | ||||||||||||
Total | $ | 101,735 | $ | 90,919 | $ | 8,026 | $ | 10,429 | ||||||||
-1 | $ 5.2 million included in the balance of $6.1 million was income from investment in Henglong in 2013, which has been eliminated at the consolidation level. | |||||||||||||||
Net Product Sales | Net Income (Loss) | |||||||||||||||
Nine Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Henglong | $ | 203,987 | $ | 177,836 | $ | 22,660 | $ | 19,751 | ||||||||
Jiulong | 57,753 | 56,735 | 1,750 | 1,516 | ||||||||||||
Shenyang | 32,928 | 28,164 | 1,760 | 1,119 | ||||||||||||
Wuhu | 18,345 | 17,113 | -167 | -312 | ||||||||||||
Hubei Henglong | 41,708 | 34,610 | 44,512 | -1 | 7,550 | -1 | ||||||||||
Other Sectors | 30,210 | 24,866 | 1,246 | 1,416 | ||||||||||||
Total Segments | 384,931 | 339,324 | 71,761 | 31,040 | ||||||||||||
Corporate | - | - | -1,792 | -2,203 | ||||||||||||
Eliminations | -53,414 | -53,353 | -40,046 | -4,677 | ||||||||||||
Total | $ | 331,517 | $ | 285,971 | $ | 29,923 | $ | 24,160 | ||||||||
-1 | $ 40.3 million and $ 5.2 million included in the respective balances of $ 44.5 million and $ 7.6 million were income from investment in Henglong in 2014 and 2013, respectively, which have been eliminated at the consolidation level. | |||||||||||||||
Subsequent_event
Subsequent event | 9 Months Ended | |
Sep. 30, 2014 | ||
Subsequent Events [Abstract] | ' | |
Subsequent Events [Text Block] | ' | |
32 | Subsequent event | |
On October 13, 2014, the Company completed its issuance of 4,078,000 common shares to nominee holders designated by Jiulong Machinery Electricity (See Note 19). | ||
On October 20, 2014, Hubei Henglong made its first capital contribution of RMB5.0 million (equivalent to approximately $0.8 million) to the Venture Fund according to the agreement Hubei Henglong signed with seven other parties (See Note 1). | ||
Basis_of_presentation_and_sign1
Basis of presentation and significant accounting policies (Policies) | 9 Months Ended | |
Sep. 30, 2014 | ||
Accounting Policies [Abstract] | ' | |
Basis of Accounting, Policy [Policy Text Block] | ' | |
(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 Article 10 of 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, 2013. | ||
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, 2013 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. | ||
Certain information and footnote disclosures normally included in financial statements that have been prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission, although the Company’s management believes that the disclosures contained in these financial statements are adequate to make the information presented herein not misleading. For further information, please refer to the financial statements and the notes thereto included in the Company’s 2013 Annual Report on Form 10-K, as filed with the Securities and Exchange Commission. | ||
The results of operations for the three months and nine months ended September 30, 2014 are not necessarily indicative of the results of operations to be expected for the full fiscal year ending December 31, 2014. | ||
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. | ||
New Accounting Pronouncements, Policy [Policy Text Block] | ' | |
(b) | Recent Accounting Pronouncements | |
In April 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2014-08 “Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity”. The new guidance changes the criteria for reporting discontinued operations while enhancing disclosures in this area. Under the new guidance, only disposals representing a strategic shift in operations should be presented as discontinued operations. Those strategic shifts should have a major effect on the organization’s operations and financial results. Additionally, ASU 2014-08 requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of discontinued operations. The new guidance also requires disclosure of the pre-tax income attributable to a disposal of a significant part of an organization that does not qualify for discontinued operations reporting. ASU 2014-08 is effective for the Company in the first quarter of fiscal 2015. Early adoption is permitted, but only for disposals (or classifications as held for sale) that have not been reported in financial statements previously issued or available for issuance. The Company is currently evaluating the impact of adopting this update on its financial statements. | ||
In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (“ASU 2014-09”), “Revenue from Contracts with Customers (Topic 606)”. ASU 2014-09 will eliminate transaction-specific and industry-specific revenue recognition guidance under current U.S. GAAP and replace it with a principle-based approach for determining revenue recognition. ASU 2014-09 will require that companies recognize revenue based on the value of transferred goods or services as they occur in the contract. The ASU also will require additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. ASU 2014-09 is effective for reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early adoption is not permitted. Entities can transition to the standard either retrospectively or as a cumulative effect adjustment as of the date of adoption. Management is currently assessing the impact the adoption of ASU 2014-09 and the effect of the standard on our ongoing financial reporting. | ||
In June 2014, the FASB issued Accounting Standards Update No. 2014-12 (“ASU 2014-12”), “Compensation—Stock Compensation (Topic 718) - Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period.” ASU 2014-12 requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in Topic 718 as it relates to awards with performance conditions that affect vesting to account for such awards. As such, the performance target should not be reflected in estimating the grant-date fair value of the award. Compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. As indicated in the definition of vest, the stated vesting period (which includes the period in which the performance target could be achieved) may differ from the requisite service period. For all entities, the amendments in this Update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The effective date is the same for both public business entities and all other entities. Entities may apply the amendments in this Update either (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. If retrospective transition is adopted, the cumulative effect of applying this Update as of the beginning of the earliest annual period presented in the financial statements should be recognized as an adjustment to the opening retained earnings balance at that date. Additionally, if retrospective transition is adopted, an entity may use hindsight in measuring and recognizing the compensation cost. The Company is currently evaluating the impact of adopting this Update on its financial statements. | ||
In August 2014, the FASB issued Accounting Standards Update No. 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern”, which will explicitly require management to assess an entity’s ability to continue as a going concern and to provide related footnote disclosures in certain circumstances. Currently, there is no guidance in GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern or to provide related footnote disclosures. The amendments in this Update provide that guidance. In doing so, the amendments should reduce diversity in the timing and content of footnote disclosures. The amendments require management to assess an entity’s ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the amendments (1) provide a definition of the term “substantial doubt”, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The amendments in this update are effective for the first annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company is currently evaluating the impact of adopting this update on its financial statements. | ||
Business Combinations Policy [Policy Text Block] | ' | |
Business Combinations – A business combination is recorded using the purchase method of accounting, and the cost of an acquisition is measured as the aggregate of the fair values at the date of exchange of the assets given, liabilities incurred, and equity instruments issued as well as the contingent considerations and all contractual contingencies as of the acquisition date. The costs directly attributable to the acquisition are expensed as incurred. Identifiable assets, liabilities and contingent liabilities acquired or assumed are measured separately at their fair value as of the acquisition date, irrespective of the extent of any non-controlling interests. The excess of (i) the total of consideration of acquisition, fair value of the non-controlling interests and acquisition date fair value of any previously held equity interest in the subsidiary acquired over (ii) the fair value of the identifiable net assets of the subsidiary acquired is recorded as goodwill. If the consideration of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in the consolidated statements of operations and comprehensive income. | ||
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block] | ' | |
Goodwill - Goodwill represents the excess of the purchase price over the fair value of the identifiable assets and liabilities acquired as a result of the Company’s acquisition of interests in its subsidiary. We test goodwill for impairment at the reporting unit level on an annual basis as of December 31, and between annual tests when an event occurs or circumstances change that could indicate that the asset might be impaired. The Company adopted the FASB revised guidance on “Testing of Goodwill for Impairment.” Under this guidance, the Company has the option to choose whether it will apply the qualitative assessment first and then the quantitative assessment, if necessary, or to apply the quantitative assessment directly. For a reporting unit applying a qualitative assessment first, the Company starts the goodwill impairment test by assessing qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If the Company determines that it is more likely than not the fair value of a reporting unit is less than its carrying amount, the quantitative impairment test is mandatory. Otherwise, no further testing is required. The quantitative impairment test uses a two-step process. In the first step, the fair value of a reporting unit is compared to its carrying value. If the fair value of a reporting unit exceeds the carrying value of the net assets assigned to a reporting unit, goodwill is considered not impaired and no further testing is required. If the carrying value of the net assets assigned to a reporting unit exceeds the fair value of a reporting unit, the second step of the impairment test is performed in order to determine the implied fair value of a reporting unit’s goodwill. Determining the implied fair value of goodwill requires valuation of a reporting unit’s tangible and intangible assets and liabilities in a manner similar to the allocation of purchase price in a business combination. If the carrying value of a reporting unit’s goodwill exceeds its implied fair value, goodwill is deemed impaired and is written down to the extent of the difference. The Company estimates total fair value of the reporting unit using discounted cash flow analysis, and makes assumptions regarding future revenue, gross margins, working capital levels, investments in new products, capital spending, tax, cash flows, and the terminal value of the reporting unit. | ||
There have been no other updates to the significant accounting policies set forth in the notes to the consolidated financial statements for the year ended December 31, 2013. | ||
Organization_and_business_Tabl
Organization and business (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ||||||||
Schedule of Equity Method Investments [Table Text Block] | ' | ||||||||
The Company owns the following aggregate net interests in the entities established in the People's Republic of China, the “PRC,” and Brazil as of September 30, 2014 and December 31, 2013. | |||||||||
Percentage Interest | |||||||||
September 30, | December 31, | ||||||||
Name of Entity | 2014 | 2013 | |||||||
Shashi Jiulong Power Steering Gears Co., Ltd., “Jiulong” 1 | 100 | % | 81 | % | |||||
Jingzhou Henglong Automotive Parts Co., Ltd., “Henglong” 2 | 100 | % | 80 | % | |||||
Shenyang Jinbei Henglong Automotive Steering System Co., Ltd., “Shenyang” 3 | 70 | % | 70 | % | |||||
Universal Sensor Application Inc., “USAI” 4 | 83.34 | % | 83.34 | % | |||||
Wuhan Jielong Electric Power Steering Co., Ltd., “Jielong” 5 | 85 | % | 85 | % | |||||
Wuhu HengLong Automotive Steering System Co., Ltd., “Wuhu” 6 | 77.33 | % | 77.33 | % | |||||
Hubei Henglong Automotive System Group Co., Ltd, “Hubei Henglong” 7 | 100 | % | 100 | % | |||||
Jingzhou Henglong Automotive Technology (Testing) Center, “Testing Center” 8 | 80 | % | 80 | % | |||||
Beijing Henglong Automotive System Co., Ltd., “Beijing Henglong” 9 | 50 | % | 50 | % | |||||
Chongqing Henglong Hongyan Automotive System Co., Ltd., “Chongqing Henglong” 10 | 70 | % | 70 | % | |||||
CAAS Brazil’s Imports And Trade In Automotive Parts Ltd., “Brazil Henglong” 11 | 80 | % | 80 | % | |||||
Fujian Qiaolong Special Purpose Vehicle Co., Ltd., “Fujian Qiaolong” 12 | 51 | % | - | ||||||
Wuhan Chuguanjie Automotive Science and Technology Ltd., “Wuhan Chuguanjie” 13 | 85 | % | - | ||||||
1. | Jiulong was established in 1993 and mainly engages in the production of integral power steering gear for heavy-duty vehicles. On August 11, 2014, the Company entered into a Stock Exchange Agreement (the “Exchange Agreement”) with a third party, Jingzhou City Jiulong Machinery Electricity Manufacturing Co., Ltd. (“Jiulong Machinery Electricity”), under which the Company issued 818,000 of its common shares in a private placement for the acquisition of the 19% equity interest in Jiulong held by Jiulong Machinery Electricity. On September 26, 2014, the Company obtained the 19% equity interest in Jiulong and completed its share registration with the local government administrative bureau. Therefore, the Company owned 100% of the equity interests in Jiulong as of September 30, 2014. While the Company retains its controlling interest of Jiulong, the Company’s acquisition of the non-controlling interest was accounted for as an equity transaction in the quarter ended September 30, 2014. On October 13, 2014, the Company completed its issuance of 818,000 common shares at market price of $9.15 per share in a private placement to nominee holders of Jiulong Machinery Electricity (See Notes 19 and 32). | ||||||||
2. | Henglong was established in 1997 and is mainly engaged in the production of rack and pinion power steering gears for cars and light duty vehicles. On August 11, 2014, the Company entered into the Exchange Agreement with a third party, Jiulong Machinery Electricity, under which the Company issued 3,260,000 of its common shares in a private placement for the acquisition of the 20% equity interest in Henglong held by Jiulong Machinery Electricity. On September 26, 2014, the Company obtained the 20% equity interest in Henglong and completed its share registration with the local government administrative bureau. Therefore, the Company owned 100% equity interests in Henglong as of September 30, 2014. While the Company retains its controlling interest of Henglong, the Company’s acquisition of the non-controlling interest was accounted for as an equity transaction in the quarter ended September 30, 2014. On October 13, 2014, the Company completed its issuance of 3,260,000 common shares at market price of $9.15 per share in a private placement to nominee holders of Jiulong Machinery Electricity (See Notes 19 and 32). | ||||||||
3 | Shenyang was established in 2002 and focuses on power steering parts for light duty vehicles. | ||||||||
4 | USAI was established in 2005 and mainly engages in the production and sales of sensor modules. | ||||||||
5 | Jielong was established in 2006 and mainly engages in the production and sales of electric power steering, “EPS.” | ||||||||
6 | Wuhu was established in 2006 and mainly engages in the production and sales of automobile steering systems. | ||||||||
7 | 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. | ||||||||
8 | In December 2009, Henglong, a subsidiary of Genesis, formed the Testing Center, which mainly engages in the research and development of new products. The registered capital of the Testing Center was RMB30.0 million, equivalent to approximately $4.4 million. | ||||||||
9 | On January 24, 2010, Genesis entered into a joint venture contract with Beijing Hainachuan Auto Parts Co., Ltd. to establish Beijing Henglong as a joint venture company to design, develop and manufacture both hydraulic and electric power steering systems and parts. On September 16, 2010, with Beijing Hainachuan’s agreement, Genesis transferred its interest in the joint venture to Hubei Henglong, and left the other terms of the joint venture contract unchanged. According to the joint venture agreement, the Company does not have voting control of Beijing Henglong. Therefore, the Company’s consolidated financial statements do not include Beijing Henglong, and such investment is accounted for through the equity method. | ||||||||
10 | 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. | ||||||||
11 | 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. | ||||||||
12 | In the second quarter of 2014, the Company acquired a 51.0% ownership interest in Fujian Qiaolong Special Purpose Vehicle Co., Ltd., “Fujian Qiaolong”, a special purpose vehicle manufacturer and dealer with automobile repacking qualifications, based in Fujian, China. Fujian Qiaolong mainly manufactures and distributes drainage and rescue vehicles with mass flow, drainage vehicles with vertical downhole operation, crawler-type mobile pump stations, high-altitude water supply and discharge drainage vehicles, long-range control crawler-type mobile pump stations and other vehicles. The consideration was approximately $3.0 million. | ||||||||
13 | In May 2014, 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. The registered capital of Wuhan Chuguanjie is RMB30.0 million, equivalent to approximately $4.9 million. At the date of release of this quarterly report, Jielong has not completed the capital injection | ||||||||
Acquisition_Tables
Acquisition (Tables) | 9 Months Ended | ||||
Sep. 30, 2014 | |||||
Business Combinations [Abstract] | ' | ||||
Schedule of Business Acquisitions, by Acquisition [Table Text Block] | ' | ||||
The following table summarizes the allocation of consideration and the respective fair values of the assets acquired and liabilities assumed in the Fujian Qiaolong acquisition as of the date of purchase (figures are in thousands of USD): | |||||
Total purchase price: | |||||
Cash consideration paid to acquire ownership interest | $ | 3,007 | |||
Assets | |||||
Cash and cash equivalents | $ | 31 | |||
Current assets, net of cash acquired | 8,428 | ||||
Deferred tax asset | 69 | ||||
Property and equipment | 3,694 | ||||
Intangible assets | 864 | ||||
Goodwill | 642 | ||||
Total assets consolidated into the Company | $ | 13,728 | |||
Liabilities | |||||
Current liabilities, excluding current deferred tax liabilities | -7,352 | ||||
Deferred tax liabilities | -448 | ||||
Other liabilities | -128 | ||||
Total liabilities consolidated into the Company | -7,928 | ||||
Non-controlling interests at fair value | -2,793 | ||||
Total equity consolidated into the Company | $ | 3,007 | |||
Accounts_and_notes_receivable_1
Accounts and notes receivable, net (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Accounts and Notes Receivable Disclosure [Abstract] | ' | |||||||
Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block] | ' | |||||||
The Company’s accounts and notes receivable as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Accounts receivable - unrelated parties (1) | $ | 131,134 | $ | 140,920 | ||||
Notes receivable - unrelated parties (2) (3) | 151,926 | 128,068 | ||||||
Total accounts and notes receivable- unrelated parties | 283,060 | 268,988 | ||||||
Less: allowance for doubtful accounts - unrelated parties | -1,440 | -1,349 | ||||||
Accounts and notes receivable, net - unrelated parties | 281,620 | 267,639 | ||||||
Accounts and notes receivable, net - related parties | 22,253 | 17,194 | ||||||
Accounts and notes receivable, net | $ | 303,873 | $ | 284,833 | ||||
-1 | As of September 30, 2014 and December 31, 2013, the Company has pledged $11.0 million and $19.1 million, respectively, of accounts receivable as security for its comprehensive credit facilities with banks in China. | |||||||
-2 | Notes receivable represent accounts receivable in the form of bills of exchange for which acceptances are guaranteed and settlements are handled by banks. | |||||||
-3 | As of September 30, 2014, Henglong collateralized its notes receivable in an amount of RMB229.2 million (equivalent to approximately $37.3 million) as security for the credit facilities with banks in China and the Chinese government, including RMB197.8 million (equivalent to approximately $32.2 million) in favor of Industrial and Commercial Bank of China, Jingzhou Branch, “ICBC Jingzhou,” for the purpose of obtaining the Henglong Standby Letter of Credit (as defined in Note 14) which is used as security for the non-revolving credit facility in the amount of $30.0 million provided by Industrial and Commercial Bank of China (Macau) Limited, “ICBC Macau,” and RMB31.4 million (equivalent to approximately $5.1 million) in favor of the Chinese government as security for the low-interest government loan (See Note 14). As of December 31, 2013, Henglong collateralized its notes receivable in an amount of RMB196.3 million (equivalent to approximately $32.2 million) in favor of Industrial and Commercial Bank of China, Jingzhou Branch, “ICBC Jingzhou,” for the purpose of obtaining the Henglong Standby Letter of Credit (as defined in Note 14) which is used as security for the non-revolving credit facility in the amount of $30.0 million provided by Industrial and Commercial Bank of China (Macau) Limited, “ICBC Macau.” | |||||||
Inventories_Tables
Inventories (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Schedule of Inventory, Current [Table Text Block] | ' | |||||||
The Company’s inventories as of September 30, 2014 and December 31, 2013 consisted of the following (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Raw materials | $ | 18,137 | $ | 12,185 | ||||
Work in process | 13,462 | 8,079 | ||||||
Finished goods | 41,092 | 31,128 | ||||||
Total | $ | 72,691 | $ | 51,392 | ||||
Other_receivables_net_Tables
Other receivables, net (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Other Receivables Disclosure [Abstract] | ' | |||||||
Schedule Of Other Receivables [Table Text Block] | ' | |||||||
The Company’s other receivables as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Other receivables - unrelated parties (1) | $ | 653 | $ | 314 | ||||
Less: allowance for doubtful accounts- unrelated parties | -108 | -62 | ||||||
Subtotal | 545 | 252 | ||||||
Other receivables - employee housing loans (2) | 839 | - | ||||||
DiviDividend receivables - affiliated company (3) | 508 | - | ||||||
Other receivables, net - unrelated parties | $ | 1,892 | $ | 252 | ||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Other receivables - related parties (1) | $ | 711 | $ | 729 | ||||
Less: allowance for doubtful accounts- related parties | -663 | -621 | ||||||
Other receivables, net - related parties | $ | 48 | $ | 108 | ||||
-1 | Other receivables consist of amounts advanced to both related and unrelated parties, primarily as unsecured demand loans, with no stated interest rate or due date. These receivables originate as part of the Company's normal operating activities and are periodically settled in cash. | |||||||
-2 | On May 28, 2014, the board of directors of the Company approved a loan program under which the Company will lend an aggregate of up to RMB50.0 million (equivalent to approximately $8.1 million) to the employees of the Company to assist them in purchasing houses. Employees are required to pay interest at an annual rate of 6.4%. The term of the loans is generally for five years. The Company accounts for employee loans to be repaid within 12 months from the ending date of reporting period in Advance payments and others - unrelated parties and loans to be repaid in more than 12 months in Other receivables - unrelated parties. As of September 30, 2014, total loans to employees under this program were $1.1 million, consisting of $0.8 million included in Other receivables - unrelated parties and $0.3 million included in Advance payments and others - unrelated parties in the accompanying condensed unaudited consolidated balance sheets. | |||||||
-3 | Beijing Henglong declared a dividend with a total amount of approximately $1 million, of which $0.5 million was payable to the Company. | |||||||
Property_plant_and_equipment_n1
Property, plant and equipment, net (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||
Property, Plant and Equipment [Table Text Block] | ' | |||||||
The Company’s property, plant and equipment as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Land use rights and buildings | $ | 47,141 | $ | 43,849 | ||||
Machinery and equipment | 116,592 | 110,322 | ||||||
Electronic equipment | 7,590 | 7,414 | ||||||
Motor vehicles | 4,043 | 3,195 | ||||||
Construction in progress | 5,976 | 5,133 | ||||||
Total amount of property, plant and equipment (1) | 181,342 | 169,913 | ||||||
Less: Accumulated depreciation (2) | -99,632 | -89,895 | ||||||
Total amount of property, plant and equipment, net (3) | $ | 81,710 | $ | 80,018 | ||||
-1 | Through the acquisition of Fujian Qiaolong in the second quarter of 2014, the Company acquired $3.7 million of property, plant and equipment, consisting of $3.4 million of land use rights and buildings, $0.2 million of machinery and equipment, and $0.1 million of motor vehicles, which are depreciated over a weighted average life of 43.0 years, 3.5 years, and 3.1 years, respectively. | |||||||
-2 | Depreciation charges were $3.7 million and $3.7 million for the three months ended September 30, 2014 and 2013, respectively, and $11.4 million and $10.8 million for the nine months ended September 30, 2014 and 2013, respectively. | |||||||
-3 | As of September 30, 2014 and December 31, 2013, the Company had pledged property, plant and equipment with net book value of $46.8 million and $51.4 million, respectively, for its comprehensive credit facilities with banks in China. | |||||||
Intangible_assetsTables
Intangible assets(Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||
Schedule of Impaired Intangible Assets [Table Text Block] | ' | |||||||
The Company’s intangible assets as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Costs: | ||||||||
Patent technology | $ | 3,073 | $ | 2,067 | ||||
Management software license | 784 | 699 | ||||||
Total intangible assets (1) | 3,857 | 2,766 | ||||||
Less: Amortization (2) | -2,285 | -2,080 | ||||||
Total intangible assets, net | $ | 1,572 | $ | 686 | ||||
-1 | Through the acquisition of Fujian Qiaolong in the second quarter of 2014, the Company acquired $0.9 million of intangible assets, consisting of $0.9 million of patent technology and $nil of management software licenses, which are amortized over a weighted average life of 4.7 years and 1.1 years, respectively. | |||||||
-2 | Amortization expenses were $0.1 million and $0.04 million for the three months ended September 30, 2014 and 2013, respectively, and $0.2 million and $0.1 million for the nine months ended September 30, 2014 and 2013, respectively. | |||||||
Deferred_income_tax_assets_Tab
Deferred income tax assets (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Income Tax Disclosure [Abstract] | ' | |||||||
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | ' | |||||||
The components of estimated deferred income tax assets as of September 30, 2014 and December 31, 2013 are as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Losses carry forward (U.S.) (1) | $ | 7,047 | $ | 6,825 | ||||
Losses carry forward (PRC) (1) | 2,126 | 1,838 | ||||||
Product warranties and other reserves | 4,421 | 4,207 | ||||||
Property, plant and equipment | 4,558 | 4,346 | ||||||
Share-based compensation | 266 | 296 | ||||||
Bonus accrual | 359 | 557 | ||||||
Other accruals | 992 | 850 | ||||||
Others | 1,036 | 1,103 | ||||||
Total deferred tax assets | 20,805 | 20,022 | ||||||
Less: taxable temporary difference related to revenue recognition | -389 | -793 | ||||||
Total deferred tax assets, net | 20,416 | 19,229 | ||||||
Less: Valuation allowance | -9,237 | -8,918 | ||||||
Total deferred tax assets, net of valuation allowance (2) | $ | 11,179 | $ | 10,311 | ||||
-1 | The net operating losses carry forward for the U.S. entity for income tax purpose are available to reduce future years' taxable income. These losses will expire, if not utilized, in 20 years. Net operating losses carry forward for non-U.S. entities can be carried forward for 5 years to offset taxable income. However, as of September 30, 2014 and December 31, 2013, the valuation allowance was $9.2 million and $8.9 million, respectively, including $7.3 million and $7.3 million, respectively, allowance for the Company’s deferred tax assets in the United States and $1.9 million and $1.7 million, respectively, allowance for the Company’s non-U.S. deferred tax assets. Based on the Company’s current operations in the United States, management believes that the deferred tax assets in the United States are not likely to be realized in the future. For the non-U.S. deferred tax assets, pursuant to certain tax laws and regulations in China, the management believes such amount will not be used to offset future taxable income. | |||||||
-2 | Approximately $4.8 million and $4.5 million of net deferred income tax asset as of September 30, 2014 and December 31, 2013, respectively, are included in non-current deferred tax assets in the accompanying condensed unaudited consolidated balance sheets. The remaining $6.4 million and $5.8 million of net deferred income tax assets as of September 30, 2014 and December 31, 2013, respectively, are included in current deferred tax assets. | |||||||
Bank_and_government_loans_net_
Bank and government loans, net (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
Schedule of Debt [Table Text Block] | ' | |||||||
Loans consist of the following as of September 30, 2014 and December 31, 2013 (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Short-term bank loan (1) (2) | $ | 5,689 | $ | 7,381 | ||||
Short-term bank loan (3) (4) | 35,000 | 30,000 | ||||||
Short-term government loan (5) | 4,876 | - | ||||||
Subtotal | 45,565 | 37,381 | ||||||
Debt issue cost | - | -57 | ||||||
Amortization | - | 57 | ||||||
Bank and government loans, net | $ | 45,565 | $ | 37,381 | ||||
-1 | These loans are secured by property, plant and equipment of the Company and are repayable within one year (See Note 11). As of September 30, 2014 and December 31, 2013, the weighted average interest rate was 6.65% and 6.22% per annum, respectively. Interest is paid on the twentieth day of each month and the principal repayment is at maturity. | |||||||
-2 | On July 18, 2013, Jiulong entered into a one-year loan agreement with China Construction Bank Jingzhou branch in the amount of $1.6 million. The agreement contains certain financial and non-financial covenants, including but not limited to restrictions on the utilization of the funds and the maintenance of an asset-liability ratio not exceeding 60%. The loan was repaid on July 17, 2014. | |||||||
-3 | On May 18, 2012, the Company entered into a credit facility agreement, the “Credit Agreement,” with ICBC Macau to obtain a non-revolving credit facility in the amount of $30.0 million, the “Credit Facility”. The Credit Facility would have expired on November 3, 2012 unless the Company drew down the line of credit in full prior to such expiration date, and the maturity date for the loan drawdown was the earlier of (i) 18 months from the drawdown or (ii) 1 month before the expiry of the standby letter of credit obtained by Henglong from ICBC Jingzhou as security for the Credit Facility, the “Henglong Standby Letter of Credit”. The interest rate of the Credit Facility is calculated based on a three-month LIBOR plus 2.25% per annum, subject to the availability of funds and fluctuation at ICBC Macau’s discretion. The interest is calculated daily based on a 360-day year and it is fixed one day before the first day of each interest period. The interest period is defined as three months from the date of drawdown. As security for the Credit Facility, the Company was required to provide ICBC Macau with the Henglong Standby Letter of Credit for a total amount not less than $31.6 million if the Credit Facility is fully drawn. | |||||||
On May 22, 2012, the Company drew down the full amount of $30.0 million under the Credit Facility and provided the Henglong Standby Letter of Credit for an amount of $31.6 million in favor of ICBC Macau. The Henglong Standby Letter of Credit issued by ICBC Jingzhou is collateralized by Henglong’s notes receivable of RMB197.8 million (equivalent to approximately $32.2 million). The Company also paid an arrangement fee of $0.1 million to ICBC Macau and $0.1 million to ICBC Jingzhou. The original maturity date of the Credit Facility was May 22, 2013. | ||||||||
On May 7, 2013, ICBC Macau agreed to extend the maturity date of the Credit Facility to May 13, 2014. The interest rate of the Credit Facility under the extended term is revised as the three-month LIBOR plus 2.0% per annum, Except for the above, all other terms and conditions as stipulated in the Credit Agreement remain unchanged. | ||||||||
On May 13, 2014, ICBC Macau agreed to extend the maturity date of the Credit Facility to May 12, 2015. The interest rate of the Credit Facility under the extended term is revised as the three-month LIBOR plus 2.55% per annum. Except for the above, all other terms and conditions as stipulated in the Credit Agreement remain unchanged. As of September 30, 2014, the interest rate of the Credit Facility was 2.80% per annum (See Note 6). | ||||||||
-4 | On July 16, 2014, Great Genesis entered into a credit facility agreement with HSBC HK to obtain a non-revolving credit facility in the amount of $5.0 million, the “HSBC Credit Facility”. The HSBC Credit Facility will expire on July 1, 2015, and has an annual interest rate of 1.7%. Interest is paid on the twentieth day of each month and the principal repayment is at maturity. As security for the HSBC Credit Facility, the Company’s subsidiary Hubei Henglong was required to provide HSBC HK with the Standby Letter of Credit for a total amount of not less than $5.4 million if the HSBC Credit Facility is fully drawn. | |||||||
On July 22, 2014, Great Genesis drew down a loan amounting to $5.0 million provided by HSBC HK and Hubei Henglong provided a Standby Letter of Credit for an amount of $5.4 million in favor of HSBC HK. Hubei Henglong’s Standby Letter of Credit was issued by HSBC Bank (China) Company Limited Wuhan branch and is collateralized by short-term investments of Hubei Henglong of RMB33.0 million (equivalent to approximately $5.4 million). | ||||||||
-5 | On March 28, 2014, the Company received a Chinese government loan of RMB30.0 million (equivalent to approximately $4.9 million), with an interest rate of 3% per annum, The government loan, will mature on March 15, 2015. Henglong has pledged RMB31.4 million (equivalent to approximately $5.1 million) of notes receivable as security for such government loan (See Note 6). | |||||||
Accounts_and_notes_payable_Tab
Accounts and notes payable (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Accounts and Notes Payable Disclosure [Abstract] | ' | |||||||
Schedule Of Accounts and Notes Payable [Table Text Block] | ' | |||||||
The Company’s accounts and notes payable as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Accounts payable - unrelated parties | $ | 129,420 | $ | 120,202 | ||||
Notes payable - unrelated parties (1) | 73,977 | 78,217 | ||||||
Total accounts and notes payable - unrelated parties | 203,397 | 198,419 | ||||||
Total accounts and notes payable - related parties | 3,837 | 4,634 | ||||||
Total accounts and notes payable | $ | 207,234 | $ | 203,053 | ||||
-1 | Notes payable represent accounts payable in the form of bills of exchange whose acceptances are guaranteed and settlements are handled by banks. The Company has pledged cash deposits, notes receivable and certain property, plant and equipment to secure notes payable granted by banks. | |||||||
Accrued_expenses_and_other_pay1
Accrued expenses and other payables (Tables) | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
Payables and Accruals [Abstract] | ' | ||||||||||
Schedule of Accounts Payable and Accrued Liabilities [Table Text Block] | ' | ||||||||||
The Company’s accrued expenses and other payables as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | |||||||||||
September 30, | December 31, | ||||||||||
2014 | 2013 | ||||||||||
Accrued expenses | $ | 5,180 | $ | 4,980 | |||||||
Accrued interest | 125 | 85 | |||||||||
Other payables | 1,480 | 1,858 | |||||||||
Dividends payable to common shareholders (1) | 757 | - | |||||||||
Dividends payable to non-controlling interests (2) | 4,063 | 35 | |||||||||
Amount payable for acquisition of non-controlling interests (See Note 19) | 37,314 | - | |||||||||
Warranty reserves (3) | 24,421 | 22,104 | |||||||||
Total | $ | 73,340 | $ | 29,062 | |||||||
-1 | On May 27, 2014, the Company announced the payment of a special cash dividend of $0.18 per common share to the Company’s shareholders of record as of the close of business on June 26, 2014. As of September 30, 2014, dividends payable of $0.8 million remained unpaid. | ||||||||||
-2 | In accordance with the resolution of the board of directors of Henglong, in June 2014, Henglong declared a dividend amounting to $40.6 million to its shareholders, of which $8.1 million was payable to the holder of the non-controlling interests. As of September 30, 2014, dividends payable of $4.1 million have not yet been paid to the holder of the non-controlling interests. | ||||||||||
-3 | 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 [Table Text Block] | ' | ||||||||||
For the nine months ended September 30, 2014 and 2013, and for the year ended December 31, 2013, the warranties activities were as follows (figures are in thousands of USD): | |||||||||||
Nine Months Ended September | Year Ended | ||||||||||
30, | December 31, | ||||||||||
2014 | 2013 | 2013 | |||||||||
Balance at beginning of the period | $ | 22,104 | $ | 18,081 | $ | 18,081 | |||||
Additions during the period | 8,333 | 8,554 | 12,707 | ||||||||
Settlement within period, by cash or actual material | -5,816 | -6,199 | -9,244 | ||||||||
Foreign currency translation gain (loss) | -200 | 404 | 560 | ||||||||
Balance at end of the period | $ | 24,421 | $ | 20,840 | $ | 22,104 | |||||
Taxes_payable_Tables
Taxes payable (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Taxes Payables [Abstract] | ' | |||||||
Schedule Of Income Taxes Payable [Table Text Block] | ' | |||||||
The Company’s taxes payable as of September 30, 2014 and December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Value-added tax payable | $ | 2,658 | $ | 5,494 | ||||
Income tax payable | 5,697 | 1,841 | ||||||
Other tax payable | 182 | 457 | ||||||
Total | $ | 8,537 | $ | 7,792 | ||||
Additional_paidin_capital_Tabl
Additional paid-in capital (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Additional Paid in Capital [Abstract] | ' | |||||||||||||||
Schedule Of Additional Paid In Capital [Table Text Block] | ' | |||||||||||||||
The Company’s positions in respect of the amounts of additional paid-in capital for the nine months ended September 30, 2014 and 2013, and the year ended December 31, 2013 are summarized as follows (figures are in thousands of USD): | ||||||||||||||||
Year Ended | ||||||||||||||||
Nine Months Ended September 30, | December 31, | |||||||||||||||
2014 | 2013 | 2013 | ||||||||||||||
Balance at beginning of the period | $ | 39,565 | $ | 39,371 | $ | 39,371 | ||||||||||
Return of common shareholders’ investment cost (1) | -5,047 | - | - | |||||||||||||
Acquisition of the non-controlling interests in Henglong and Jiulong (2) | -7,502 | - | - | |||||||||||||
Share-based compensation (3) | 193 | 194 | 194 | |||||||||||||
Balance at end of the period | $ | 27,209 | $ | 39,565 | $ | 39,565 | ||||||||||
-1 | On May 27, 2014, the Company announced a special cash dividend of $0.18 per common share to the Company’s shareholders of record as of the close of business on June 26, 2014. As China Automotive Systems, the parent company, had an accumulated deficit position as of the date of the dividend declaration, the dividends distributed to the Company’s common shareholders described above are treated as a return of common shareholders’ investment cost. | |||||||||||||||
-2 | On August 11, 2014, the Company entered into the Exchange Agreement with Jiulong Machinery Electricity, under which the Company issued 3,260,000 and 818,000 of its common shares in consideration for the acquisition of the 20% and 19% equity interests in Henglong and Jiulong, respectively, held by Jiulong Machinery Electricity. On September 26, 2014, the Company obtained the 20% and 19% equity interests in Henglong and Jiulong, respectively, and completed its share registrations with the local government administrative bureau. The Company owned 100% of the equity interests in both Henglong and Jiulong as of September 30, 2014. The Company’s acquisitions of the non-controlling interests were accounted for as equity transactions in the quarter ended September 30, 2014. The total carrying value for the non-controlling interests in both Henglong and Jiulong was $34.5 million, including the accumulated other comprehensive income of $4.7 million related to the noncontrolling interests acquired. Therefore, the total carrying value of $34.5 million for the non-controlling interests acquired was reclassified from non-controlling interests to the controlling interest’s equity as of September 30, 2014. The fair market value of the Company’s common stock issued was $37.3 million or $9.15 per share, which was determined on the issuance date of the common shares. The difference between the fair market value of $37.3 million for the Company’s common shares issued and the carrying value of $34.5 million for the non-controlling interest acquired of $2.8 million was recorded as a reduction of additional paid-in capital. Additional paid-in capital of the Company was also decreased by $4.7 million and the accumulated other comprehensive income attributable to Henglong and Jiulong was increased by a corresponding amount. | |||||||||||||||
On October 13, 2014, the Company completed its issuance of 4,078,000 common shares to nominee holders designated by Jiulong Machinery Electricity (See Note 32). | ||||||||||||||||
-3 | On September 16, 2014 and August 13, 2013, the Company granted 22,500 and 22,500 stock options, respectively, to the Company’s independent directors, with the exercise price equal to the closing price of the Company’s common stock traded on NASDAQ on the date of grant. The fair value of stock options was determined at the date of grant using the Black-Scholes option pricing model. The Black-Scholes option model requires management to make various estimates and assumptions, including expected term, expected volatility, risk-free rate and dividend yield. The expected term represents the period of time that stock-based compensation awards granted are expected to be outstanding and is estimated based on considerations including the vesting period, contractual term and anticipated employee exercise patterns. Expected volatility is based on the historical volatility of the Company’s stock. The risk-free rate is based on the U.S. Treasury yield curve in relation to the contractual life of stock-based compensation instruments. The dividend yield assumption is based on historical patterns and future expectations for the Company’s dividends. | |||||||||||||||
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | ' | |||||||||||||||
Assumptions used to estimate the fair value of stock options on the grant dates are as follows: | ||||||||||||||||
Issuance Date | Expected volatility | Risk-free rate | Expected term (years) | Dividend yield | ||||||||||||
16-Sep-14 | 120.6 | % | 1.78 | % | 5 | 0 | % | |||||||||
13-Aug-13 | 131.5 | % | 1.49 | % | 5 | 0 | % | |||||||||
Retained_earnings_Tables
Retained earnings (Tables) | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
Retained Earnings Disclosure [Abstract] | ' | ||||||||||
Schedule Of Appropriated Retained Earnings [Table Text Block] | ' | ||||||||||
The Company’s activities in respect of the amounts of the appropriated retained earnings for the nine months ended September 30, 2014 and 2013, and the year ended December 31, 2013 are summarized as follows (figures are in thousands of USD): | |||||||||||
Year Ended | |||||||||||
Nine Months Ended September 30, | December 31, | ||||||||||
2014 | 2013 | 2013 | |||||||||
Balance at beginning of the period | $ | 10,048 | $ | 9,953 | $ | 9,953 | |||||
Appropriation of retained earnings | 130 | 95 | 95 | ||||||||
Balance at end of the period | $ | 10,178 | $ | 10,048 | $ | 10,048 | |||||
Schedule Of Unappropriated Retained Earnings [Table Text Block] | ' | ||||||||||
The Company’s activities in respect of the amounts of the unappropriated retained earnings for the nine months ended September 30, 2014 and 2013, and the year ended December 31, 2013 are summarized as follows (figures are in thousands of USD): | |||||||||||
Nine Months Ended September | Year Ended | ||||||||||
30, | December 31, | ||||||||||
2014 | 2013 | 2013 | |||||||||
Balance at beginning of the period | $ | 146,023 | $ | 119,329 | $ | 119,329 | |||||
Net income attributable to parent company | 24,514 | 19,544 | 26,789 | ||||||||
Appropriation of retained earnings | -130 | -95 | -95 | ||||||||
Balance at end of the period | $ | 170,407 | $ | 138,778 | $ | 146,023 | |||||
Accumulated_other_comprehensiv1
Accumulated other comprehensive income (Tables) | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
Equity [Abstract] | ' | ||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | ' | ||||||||||
The Company’s activities in respect of the amounts of the accumulated other comprehensive income for the nine months ended September 30, 2014 and 2013, and the year ended December 31, 2013 are summarized as follows (figures are in thousands of USD): | |||||||||||
Nine Months Ended September | Year Ended | ||||||||||
30, | December 31, | ||||||||||
2014 | 2013 | 2013 | |||||||||
Balance at beginning of the period | $ | 32,061 | $ | 25,898 | $ | 25,898 | |||||
Other comprehensive income related to the non-controlling interests acquired by the Company (See Note 19) | 4,743 | - | - | ||||||||
Foreign currency translation adjustment attributable to parent company | -2,010 | 4,374 | 6,163 | ||||||||
Balance at end of the period | $ | 34,794 | $ | 30,272 | $ | 32,061 | |||||
Noncontrolling_interests_Table
Non-controlling interests (Tables) | 9 Months Ended | ||||||||||
Sep. 30, 2014 | |||||||||||
Noncontrolling Interest [Abstract] | ' | ||||||||||
Schedule Of Non Controlling Interests Disclosure [Table Text Block] | ' | ||||||||||
The Company’s activities in respect of the amounts of the non-controlling interests’ equity for the nine months ended September 30, 2014 and 2013, and the year ended December 31, 2013 are summarized as follows (figures are in thousands of USD): | |||||||||||
Nine Months Ended September | Year Ended | ||||||||||
30, | December 31, | ||||||||||
2014 | 2013 | 2013 | |||||||||
Balance at beginning of the period | $ | 45,071 | $ | 38,846 | $ | 38,846 | |||||
Fair value of the non-controlling interests arising from the acquisition of Fujian Qiaolong (1) | 2,793 | - | - | ||||||||
Acquisition of the non-controlling interests in Henglong and Jiulong (See Note 19) | -29,812 | - | - | ||||||||
Other comprehensive income related to the non-controlling interests acquired by the Company (See Note 19) | -4,743 | - | - | ||||||||
Income attributable to non-controlling interests | 5,409 | 4,616 | 6,276 | ||||||||
Dividends declared to the non-controlling interest holders of joint-venture companies (See Note 16) | -10,077 | -1,299 | -1,299 | ||||||||
Foreign currency translation adjustment attributable to non-controlling interests | -403 | 892 | 1,248 | ||||||||
Balance at end of the period | $ | 8,238 | $ | 43,055 | $ | 45,071 | |||||
-1 | In the second quarter of 2014, the Company acquired a 51.0% equity interest in Fujian Qiaolong (See Note 3). The fair value of the non-controlling interest of Fujian Qiaolong is $2.8 million. | ||||||||||
Financial_income_net_Tables
Financial income, net (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Financial Income Expenses Disclosure [Abstract] | ' | |||||||
Schedule Of Financial Expenses [Table Text Block] | ' | |||||||
During the three months and nine months ended September 30, 2014 and 2013, the Company recorded financial income, net which is summarized as follows (figures are in thousands of USD): | ||||||||
Three Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Interest expense | $ | -728 | $ | -284 | ||||
Interest income | 1,404 | 1,143 | ||||||
Foreign exchange loss, net | -63 | -24 | ||||||
Gain of cash discount, net | 3 | 3 | ||||||
Bank fees | -204 | -149 | ||||||
Total financial income, net | $ | 412 | $ | 689 | ||||
Nine Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Interest expense | $ | -1,552 | $ | -1,289 | ||||
Interest income | 2,657 | 2,298 | ||||||
Foreign exchange loss, net | -62 | -71 | ||||||
Gain (loss) of cash discount, net | 65 | -9 | ||||||
Bank fees | -510 | -549 | ||||||
Total financial income, net | $ | 598 | $ | 380 | ||||
Income_per_share_Tables
Income per share (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | ' | |||||||
The calculation of basic and diluted income per share attributable to the parent company for the three months ended September 30, 2014 and 2013, were (figures are in thousands of USD , except share and per share amounts): | ||||||||
Three Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Numerator: | ||||||||
Net income attributable to the parent company’s common shareholders – Basic and Diluted | $ | 6,733 | $ | 8,624 | ||||
Denominator: | ||||||||
Weighted average shares outstanding | 28,043,019 | 28,043,019 | ||||||
Dilutive effects of stock options | 20,642 | 19,278 | ||||||
Denominator for dilutive income per share – Diluted | 28,063,661 | 28,062,297 | ||||||
Net income per share attributable to parent company’s common shareholders – Basic | $ | 0.24 | $ | 0.31 | ||||
Net income per share attributable to parent company’s common shareholders – Diluted | $ | 0.24 | $ | 0.31 | ||||
The calculations of basic and diluted income per share attributable to the parent company for the nine months ended September 30, 2014 and 2013, were (figures are in thousands of USD , except share and per share amounts ): | ||||||||
Nine Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Numerator: | ||||||||
Net income attributable to the parent company’s common shareholders – Basic and Diluted | $ | 24,514 | $ | 19,544 | ||||
Denominator: | ||||||||
Weighted average shares outstanding | 28,043,019 | 28,043,019 | ||||||
Dilutive effects of stock options | 20,827 | 10,989 | ||||||
Denominator for dilutive income per share – Diluted | 28,063,846 | 28,054,008 | ||||||
Net income per share attributable to parent company’s common shareholders – Basic | $ | 0.87 | $ | 0.7 | ||||
Net income per share attributable to parent company’s common shareholders – Diluted | $ | 0.87 | $ | 0.7 | ||||
Related_party_transactions_and1
Related party transactions and balances (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Related Party Transactions [Abstract] | ' | |||||||
Schedule Of Related Party Transactions [Table Text Block] | ' | |||||||
Related party transactions are as follows (figures are in thousands of USD): | ||||||||
Related sales | ||||||||
Three Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Merchandise sold to related parties | $ | 11,890 | $ | 9,166 | ||||
Rental income obtained from related parties | 199 | - | ||||||
Materials sold to related parties | 657 | - | ||||||
Total | $ | 12,746 | $ | 9,166 | ||||
Nine Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Merchandise sold to related parties | $ | 38,627 | $ | 26,344 | ||||
Rental income obtained from related parties | 199 | - | ||||||
Materials sold to related parties | 657 | - | ||||||
Total | $ | 39,483 | $ | 26,344 | ||||
Related purchases | ||||||||
Three Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Materials purchased from related parties | $ | 6,069 | $ | 10,500 | ||||
Technology purchased from related parties | 114 | 58 | ||||||
Equipment purchased from related parties | 1,274 | 777 | ||||||
Total | $ | 7,457 | $ | 11,335 | ||||
Nine Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Materials purchased from related parties | $ | 20,721 | $ | 23,171 | ||||
Technology purchased from related parties | 278 | 575 | ||||||
Equipment purchased from related parties | 2,528 | 2,160 | ||||||
Total | $ | 23,527 | $ | 25,906 | ||||
Related receivables | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Accounts receivable | $ | 22,253 | $ | 17,194 | ||||
Other receivables | 48 | 108 | ||||||
Total | $ | 22,301 | $ | 17,302 | ||||
Related advances | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Advance equipment payment to related parties | $ | 2,391 | $ | 2,097 | ||||
Advance payments and others to related parties | 1,715 | 866 | ||||||
Total | $ | 4,106 | $ | 2,963 | ||||
Related payables | ||||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Accounts payable | $ | 3,837 | $ | 4,634 | ||||
Loans to Related Parties | ||||||||
For the three months and nine months ended September 30, 2014, there were no loan activities with related parties. | ||||||||
Three Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Loans to related parties | $ | - | $ | 19,922 | ||||
Nine Months Ended September | ||||||||
30, | ||||||||
2014 | 2013 | |||||||
Loans to related parties | $ | - | $ | 20,608 | ||||
Commitments_and_contingencies_
Commitments and contingencies (Tables) | 9 Months Ended | |||||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||||||||||
Contractual Obligation, Fiscal Year Maturity Schedule [Table Text Block] | ' | |||||||||||||||||||
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 September 30, 2014 (figures are in thousands of USD): | ||||||||||||||||||||
Payment obligations by period | ||||||||||||||||||||
2014 (1) | 2015 | 2016 | 2017 | Thereafter | Total | |||||||||||||||
Interest on short-term bank loan | $ | 383 | $ | 606 | $ | - | $ | - | $ | - | $ | 989 | ||||||||
Obligations for investment contracts (2) | 813 | 1,625 | 3,251 | 2,438 | - | 8,127 | ||||||||||||||
Obligations for purchasing and service agreements | 3,715 | 4,538 | 96 | - | - | 8,349 | ||||||||||||||
Total | $ | 4,911 | $ | 6,769 | $ | 3,347 | $ | 2,438 | $ | - | $ | 17,465 | ||||||||
(1) Remaining 3 months in 2014. | ||||||||||||||||||||
(2) Capital Commitment to the Venture Fund | ||||||||||||||||||||
Segment_reporting_Tables
Segment reporting (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
Schedule of Revenue by Major Customers by Reporting Segments [Table Text Block] | ' | |||||||||||||||
The Company’s product sector information for the three months and nine months ended September 30, 2014 and 2013, is as follows (figures are in thousands of USD): | ||||||||||||||||
Net Product Sales | Net Income (Loss) | |||||||||||||||
Three Months Ended September | Three Months Ended September | |||||||||||||||
30, | 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Henglong | $ | 60,902 | $ | 55,846 | $ | 5,127 | $ | 8,368 | ||||||||
Jiulong | 15,964 | 16,692 | 168 | 279 | ||||||||||||
Shenyang | 8,988 | 9,095 | 998 | 603 | ||||||||||||
Wuhu | 5,941 | 4,948 | -88 | -145 | ||||||||||||
Hubei Henglong | 14,425 | 11,783 | 1,110 | 6,092 | -1 | |||||||||||
Other Sectors | 9,887 | 7,558 | 252 | 522 | ||||||||||||
Total Segments | 116,107 | 105,922 | 7,567 | 15,719 | ||||||||||||
Corporate | - | - | 231 | 309 | ||||||||||||
Eliminations | -14,372 | -15003 | 228 | -5,599 | ||||||||||||
Total | $ | 101,735 | $ | 90,919 | $ | 8,026 | $ | 10,429 | ||||||||
-1 | $ 5.2 million included in the balance of $6.1 million was income from investment in Henglong in 2013, which has been eliminated at the consolidation level. | |||||||||||||||
Net Product Sales | Net Income (Loss) | |||||||||||||||
Nine Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Henglong | $ | 203,987 | $ | 177,836 | $ | 22,660 | $ | 19,751 | ||||||||
Jiulong | 57,753 | 56,735 | 1,750 | 1,516 | ||||||||||||
Shenyang | 32,928 | 28,164 | 1,760 | 1,119 | ||||||||||||
Wuhu | 18,345 | 17,113 | -167 | -312 | ||||||||||||
Hubei Henglong | 41,708 | 34,610 | 44,512 | -1 | 7,550 | -1 | ||||||||||
Other Sectors | 30,210 | 24,866 | 1,246 | 1,416 | ||||||||||||
Total Segments | 384,931 | 339,324 | 71,761 | 31,040 | ||||||||||||
Corporate | - | - | -1,792 | -2,203 | ||||||||||||
Eliminations | -53,414 | -53,353 | -40,046 | -4,677 | ||||||||||||
Total | $ | 331,517 | $ | 285,971 | $ | 29,923 | $ | 24,160 | ||||||||
-1 | $ 40.3 million and $ 5.2 million included in the respective balances of $ 44.5 million and $ 7.6 million were income from investment in Henglong in 2014 and 2013, respectively, which have been eliminated at the consolidation level. | |||||||||||||||
Organization_and_business_Deta
Organization and business (Details) | Sep. 30, 2014 | Dec. 31, 2013 | ||
Shashi Jiulong Power Steering Gears Co Ltd [Member] | ' | ' | ||
Organization And Principal Activities [Line Items] | ' | ' | ||
Percentage Interest | 100.00% | [1] | 81.00% | [1] |
Jingzhou Henglong Automotive Parts Co Ltd [Member] | ' | ' | ||
Organization And Principal Activities [Line Items] | ' | ' | ||
Percentage Interest | 100.00% | [2] | 80.00% | [2] |
Shenyang Jinbei Henglong Automotive Steering System Co Ltd [Member] | ' | ' | ||
Organization And Principal Activities [Line Items] | ' | ' | ||
Percentage Interest | 70.00% | [3] | 70.00% | [3] |
Universal Sensor Application Inc [Member] | ' | ' | ||
Organization And Principal Activities [Line Items] | ' | ' | ||
Percentage Interest | 83.34% | [4] | 83.34% | [4] |
Wuhan Jielong Electric Power Steering Co Ltd [Member] | ' | ' | ||
Organization And Principal Activities [Line Items] | ' | ' | ||
Percentage Interest | 85.00% | [5] | 85.00% | [5] |
Wuhu Henglong Auto Steering System Co Ltd [Member] | ' | ' | ||
Organization And Principal Activities [Line Items] | ' | ' | ||
Percentage Interest | 77.33% | [6] | 77.33% | [6] |
Hubei Henglong Automotive System Co Ltd [Member] | ' | ' | ||
Organization And Principal Activities [Line Items] | ' | ' | ||
Percentage Interest | 100.00% | [7] | 100.00% | [7] |
Jingzhou Henglong Automotive Technology Testing Center [Member] | ' | ' | ||
Organization And Principal Activities [Line Items] | ' | ' | ||
Percentage Interest | 80.00% | [8] | 80.00% | [8] |
Beijing Henglong Automotive System Co Ltd [Member] | ' | ' | ||
Organization And Principal Activities [Line Items] | ' | ' | ||
Percentage Interest | 50.00% | [9] | 50.00% | [9] |
Chongqing Henglong Hongyan Automotive Systems Co Ltd [Member] | ' | ' | ||
Organization And Principal Activities [Line Items] | ' | ' | ||
Percentage Interest | 70.00% | [10] | 70.00% | [10] |
CAAS Brazils Imports and Trade In Automotive Parts Ltd [Member] | ' | ' | ||
Organization And Principal Activities [Line Items] | ' | ' | ||
Percentage Interest | 80.00% | [11] | 80.00% | [11] |
Fujian Qiaolong Special Purpose Vehicle Co Ltd [Member] | ' | ' | ||
Organization And Principal Activities [Line Items] | ' | ' | ||
Percentage Interest | 51.00% | [12] | 0.00% | [12] |
Wuhan Chuguanjie Automotive Science and Technology Ltd [Member] | ' | ' | ||
Organization And Principal Activities [Line Items] | ' | ' | ||
Percentage Interest | 85.00% | [13] | 0.00% | [13] |
[1] | Jiulong was established in 1993 and mainly engages in the production of integral power steering gear for heavy-duty vehicles. On August 11, 2014, the Company entered into a Stock Exchange Agreement (the “Exchange Agreementâ€) with a third party, Jingzhou City Jiulong Machinery Electricity Manufacturing Co., Ltd. (“Jiulong Machinery Electricityâ€), under which the Company issued 818,000 of its common shares in a private placement for the acquisition of the 19% equity interest in Jiulong held by Jiulong Machinery Electricity. On September 26, 2014, the Company obtained the 19% equity interest in Jiulong and completed its share registration with the local government administrative bureau. Therefore, the Company owned 100% of the equity interests in Jiulong as of September 30, 2014. While the Company retains its controlling interest of Jiulong, the Company’s acquisition of the non-controlling interest was accounted for as an equity transaction in the quarter ended September 30, 2014. On October 13, 2014, the Company completed its issuance of 818,000 common shares at market price of $9.15 per share in a private placement to nominee holders of Jiulong Machinery Electricity (See Notes 19 and 32). | |||
[2] | Henglong was established in 1997 and is mainly engaged in the production of rack and pinion power steering gears for cars and light duty vehicles. On August 11, 2014, the Company entered into the Exchange Agreement with a third party, Jiulong Machinery Electricity, under which the Company issued 3,260,000 of its common shares in a private placement for the acquisition of the 20% equity interest in Henglong held by Jiulong Machinery Electricity. On September 26, 2014, the Company obtained the 20% equity interest in Henglong and completed its share registration with the local government administrative bureau. Therefore, the Company owned 100% equity interests in Henglong as of September 30, 2014. While the Company retains its controlling interest of Henglong, the Company’s acquisition of the non-controlling interest was accounted for as an equity transaction in the quarter ended September 30, 2014. On October 13, 2014, the Company completed its issuance of 3,260,000 common shares at market price of $9.15 per share in a private placement to nominee holders of Jiulong Machinery Electricity (See Notes 19 and 32). | |||
[3] | Shenyang was established in 2002 and focuses on power steering parts for light duty vehicles. | |||
[4] | USAI was established in 2005 and mainly engages in the production and sales of sensor modules. | |||
[5] | Jielong was established in 2006 and mainly engages in the production and sales of electric power steering, “EPS.†| |||
[6] | Wuhu was established in 2006 and mainly engages in the production and sales of automobile steering systems. | |||
[7] | 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. | |||
[8] | In December 2009, Henglong, a subsidiary of Genesis, formed the Testing Center, which mainly engages in the research and development of new products. The registered capital of the Testing Center was RMB30.0 million, equivalent to approximately $4.4 million. | |||
[9] | On January 24, 2010, Genesis entered into a joint venture contract with Beijing Hainachuan Auto Parts Co., Ltd. to establish Beijing Henglong as a joint venture company to design, develop and manufacture both hydraulic and electric power steering systems and parts. On September 16, 2010, with Beijing Hainachuan’s agreement, Genesis transferred its interest in the joint venture to Hubei Henglong, and left the other terms of the joint venture contract unchanged. According to the joint venture agreement, the Company does not have voting control of Beijing Henglong. Therefore, the Company’s consolidated financial statements do not include Beijing Henglong, and such investment is accounted for through the equity method. | |||
[10] | 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. | |||
[11] | 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. | |||
[12] | In the second quarter of 2014, the Company acquired a 51.0% ownership interest in Fujian Qiaolong Special Purpose Vehicle Co., Ltd., “Fujian Qiaolongâ€, a special purpose vehicle manufacturer and dealer with automobile repacking qualifications, based in Fujian, China. Fujian Qiaolong mainly manufactures and distributes drainage and rescue vehicles with mass flow, drainage vehicles with vertical downhole operation, crawler-type mobile pump stations, high-altitude water supply and discharge drainage vehicles, long-range control crawler-type mobile pump stations and other vehicles. The consideration was approximately $3.0 million. | |||
[13] | In May 2014, Jielong formed a subsidiary, Wuhan Chuguanjie Automotive Science and Technology Ltd., “Wuhan Chuguanjieâ€, which mainly engages in research and development, manufacture and sales of automobile electronic systems and parts. Wuhan Chuguanjie is located in Wuhan, China. The registered capital of Wuhan Chuguanjie is RMB30.0 million, equivalent to approximately $4.9 million. At the date of release of this quarterly report, Jielong has not completed the capital injection. |
Organization_and_business_Deta1
Organization and business (Details Textual) | Sep. 30, 2014 | Jun. 30, 2014 | Aug. 11, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Aug. 11, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2009 | Dec. 31, 2009 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | 31-May-14 | 31-May-14 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | ||||||||||||||||||||||||
Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | Henglong USA Corporation [Member] | Jiulong Power Steering Gears Co Ltd [Member] | Jiulong Power Steering Gears Co Ltd [Member] | Jiulong Power Steering Gears Co Ltd [Member] | Jingzhou Henglong Automotive Parts Co Ltd [Member] | Jingzhou Henglong Automotive Parts Co Ltd [Member] | Shenyang Jinbei Henglong Automotive Steering System Co Ltd [Member] | Shenyang Jinbei Henglong Automotive Steering System Co Ltd [Member] | Zhejiang Henglong and Vie Pump Manu Co Ltd [Member] | Universal Sensor Application Inc [Member] | Universal Sensor Application Inc [Member] | Wuhan Jielong Electric Power Steering Co Ltd [Member] | Wuhan Jielong Electric Power Steering Co Ltd [Member] | Wuhu Henglong Auto Steering System Co Ltd [Member] | Wuhu Henglong Auto Steering System Co Ltd [Member] | Beijing Henglong Automotive System Co Ltd [Member] | Beijing Henglong Automotive System Co Ltd [Member] | Chongqing Henglong Hongyan Automotive Systems Co Ltd [Member] | Chongqing Henglong Hongyan Automotive Systems Co Ltd [Member] | Jingzhou Hengsheng Automotive System Co Ltd [Member] | Jingzhou Hengsheng Automotive System Co Ltd [Member] | CAAS Brazils Imports and Trade In Automotive Parts Ltd [Member] | CAAS Brazils Imports and Trade In Automotive Parts Ltd [Member] | Jingzhou Henglong Automotive Technology Testing Center [Member] | Jingzhou Henglong Automotive Technology Testing Center [Member] | Wuhan Chuguanjie Automotive Science and Technology Ltd [Member] | Wuhan Chuguanjie Automotive Science and Technology Ltd [Member] | Wuhan Chuguanjie Automotive Science and Technology Ltd [Member] | Wuhan Chuguanjie Automotive Science and Technology Ltd [Member] | Fujian Qiaolong Special Purpose Vehicle Co Ltd [Member] | Fujian Qiaolong Special Purpose Vehicle Co Ltd [Member] | Hubei Henglong [Member] | Hubei Henglong [Member] | Hubei Henglong [Member] | Hubei Henglong [Member] | |||||||||||||||||||||||||
USD ($) | Private Placement [Member] | Private Placement [Member] | USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | Suzhou Qingyan Automobile Industry Venture Firm [Member] | Suzhou Qingyan Automobile Industry Venture Firm [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||
USD ($) | USD ($) | USD ($) | CNY | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization And Principal Activities [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Capital | $3,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $4,400,000 | 30,000,000 | ' | ' | ' | ' | ' | $4.90 | 30 | ' | ' | ' | $8,100,000 | 50,000,000 | $800,000 | 5,000,000 | ||||||||||||||||||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 51.00% | 51.00% | ' | ' | ' | ' | ' | ' | ' | ' | 51.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Noncontrolling Interest, Ownership Percentage by Parent | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 17.90% | 17.90% | ' | ' | ||||||||||||||||||||||||
Partners' Capital | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $45,500,000 | 280,000,000 | ' | ' | ||||||||||||||||||||||||
Stock Issued During Period, Shares, Acquisitions | ' | ' | 3,260,000 | ' | ' | 818,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
Equity Method Investment, Ownership Percentage | ' | ' | 20.00% | 100.00% | [1] | 81.00% | [1] | 19.00% | 100.00% | [2] | 80.00% | [2] | 70.00% | [3] | 70.00% | [3] | ' | 83.34% | [4] | 83.34% | [4] | 85.00% | [5] | 85.00% | [5] | 77.33% | [6] | 77.33% | [6] | 50.00% | [7] | 50.00% | [7] | 70.00% | [8] | 70.00% | [8] | ' | ' | 80.00% | [9] | 80.00% | [9] | 80.00% | [10] | 80.00% | [10] | 85.00% | [11] | ' | ' | 0.00% | [11] | 51.00% | [12] | 0.00% | [12] | ' | ' | ' | ' |
Sale of Stock, Price Per Share | ' | ' | $9.15 | ' | ' | $9.15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||||||||||||||||
[1] | Jiulong was established in 1993 and mainly engages in the production of integral power steering gear for heavy-duty vehicles. On August 11, 2014, the Company entered into a Stock Exchange Agreement (the “Exchange Agreementâ€) with a third party, Jingzhou City Jiulong Machinery Electricity Manufacturing Co., Ltd. (“Jiulong Machinery Electricityâ€), under which the Company issued 818,000 of its common shares in a private placement for the acquisition of the 19% equity interest in Jiulong held by Jiulong Machinery Electricity. On September 26, 2014, the Company obtained the 19% equity interest in Jiulong and completed its share registration with the local government administrative bureau. Therefore, the Company owned 100% of the equity interests in Jiulong as of September 30, 2014. While the Company retains its controlling interest of Jiulong, the Company’s acquisition of the non-controlling interest was accounted for as an equity transaction in the quarter ended September 30, 2014. On October 13, 2014, the Company completed its issuance of 818,000 common shares at market price of $9.15 per share in a private placement to nominee holders of Jiulong Machinery Electricity (See Notes 19 and 32). | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[2] | Henglong was established in 1997 and is mainly engaged in the production of rack and pinion power steering gears for cars and light duty vehicles. On August 11, 2014, the Company entered into the Exchange Agreement with a third party, Jiulong Machinery Electricity, under which the Company issued 3,260,000 of its common shares in a private placement for the acquisition of the 20% equity interest in Henglong held by Jiulong Machinery Electricity. On September 26, 2014, the Company obtained the 20% equity interest in Henglong and completed its share registration with the local government administrative bureau. Therefore, the Company owned 100% equity interests in Henglong as of September 30, 2014. While the Company retains its controlling interest of Henglong, the Company’s acquisition of the non-controlling interest was accounted for as an equity transaction in the quarter ended September 30, 2014. On October 13, 2014, the Company completed its issuance of 3,260,000 common shares at market price of $9.15 per share in a private placement to nominee holders of Jiulong Machinery Electricity (See Notes 19 and 32). | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[3] | Shenyang was established in 2002 and focuses on power steering parts for light duty vehicles. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[4] | USAI was established in 2005 and mainly engages in the production and sales of sensor modules. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[5] | Jielong was established in 2006 and mainly engages in the production and sales of electric power steering, “EPS.†| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[6] | Wuhu was established in 2006 and mainly engages in the production and sales of automobile steering systems. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[7] | On January 24, 2010, Genesis entered into a joint venture contract with Beijing Hainachuan Auto Parts Co., Ltd. to establish Beijing Henglong as a joint venture company to design, develop and manufacture both hydraulic and electric power steering systems and parts. On September 16, 2010, with Beijing Hainachuan’s agreement, Genesis transferred its interest in the joint venture to Hubei Henglong, and left the other terms of the joint venture contract unchanged. According to the joint venture agreement, the Company does not have voting control of Beijing Henglong. Therefore, the Company’s consolidated financial statements do not include Beijing Henglong, and such investment is accounted for through the equity method. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[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. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[10] | In December 2009, Henglong, a subsidiary of Genesis, formed the Testing Center, which mainly engages in the research and development of new products. The registered capital of the Testing Center was RMB30.0 million, equivalent to approximately $4.4 million. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[11] | In May 2014, Jielong formed a subsidiary, Wuhan Chuguanjie Automotive Science and Technology Ltd., “Wuhan Chuguanjieâ€, which mainly engages in research and development, manufacture and sales of automobile electronic systems and parts. Wuhan Chuguanjie is located in Wuhan, China. The registered capital of Wuhan Chuguanjie is RMB30.0 million, equivalent to approximately $4.9 million. At the date of release of this quarterly report, Jielong has not completed the capital injection. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
[12] | In the second quarter of 2014, the Company acquired a 51.0% ownership interest in Fujian Qiaolong Special Purpose Vehicle Co., Ltd., “Fujian Qiaolongâ€, a special purpose vehicle manufacturer and dealer with automobile repacking qualifications, based in Fujian, China. Fujian Qiaolong mainly manufactures and distributes drainage and rescue vehicles with mass flow, drainage vehicles with vertical downhole operation, crawler-type mobile pump stations, high-altitude water supply and discharge drainage vehicles, long-range control crawler-type mobile pump stations and other vehicles. The consideration was approximately $3.0 million. |
Acquisition_Details
Acquisition (Details) (USD $) | 9 Months Ended | 3 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2014 | Sep. 30, 2014 |
Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | ||||
Total purchase price: | ' | ' | ' | ' | ' |
Cash consideration paid to acquire ownership interest | $3,007 | $0 | ' | $3,007 | ' |
Assets | ' | ' | ' | ' | ' |
Cash and cash equivalents | 31 | 0 | ' | 31 | ' |
Current assets, net of cash acquired | ' | ' | ' | 8,428 | ' |
Deferred tax asset | ' | ' | ' | 69 | ' |
Property and equipment | ' | ' | ' | 3,694 | 3,700 |
Intangible assets | ' | ' | ' | 864 | ' |
Goodwill | 642 | ' | 0 | 642 | ' |
Total assets consolidated into the Company | ' | ' | ' | 13,728 | ' |
Liabilities | ' | ' | ' | ' | ' |
Current liabilities, excluding current deferred tax liabilities | ' | ' | ' | -7,352 | ' |
Deferred tax liabilities | ' | ' | ' | -448 | ' |
Other liabilities | ' | ' | ' | -128 | ' |
Total liabilities consolidated into the Company | ' | ' | ' | -7,928 | ' |
Non-controlling interests at fair value | ' | ' | ' | -2,793 | ' |
Total equity consolidated into the Company | ' | ' | ' | $3,007 | ' |
Acquisition_Details_Textual
Acquisition (Details Textual) (USD $) | 9 Months Ended | 3 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Jun. 30, 2014 | Sep. 30, 2014 |
Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | |||
Business Acquisition [Line Items] | ' | ' | ' | ' |
Business Acquisition, Percentage of Voting Interests Acquired | ' | ' | 51.00% | 51.00% |
Payments to Acquire Businesses, Gross | $3,007 | $0 | $3,007 | ' |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | ' | ' | '4 years 8 months 12 days | ' |
Pledged_cash_deposits_Details_
Pledged cash deposits (Details Textual) | 9 Months Ended |
Sep. 30, 2014 | |
Minimum [Member] | ' |
Cash and Cash Equivalents [Line Items] | ' |
Percentage Of Cash And Cash Equivalent Reserve Deposit Required | 30.00% |
Maximum [Member] | ' |
Cash and Cash Equivalents [Line Items] | ' |
Percentage Of Cash And Cash Equivalent Reserve Deposit Required | 100.00% |
Shortterm_investments_Details_
Short-term investments (Details Textual) (HSBC Bank China Company Limited [Member]) | Sep. 30, 2014 | Sep. 30, 2014 | Jul. 22, 2014 | Jul. 22, 2014 |
In Millions, unless otherwise specified | USD ($) | CNY | USD ($) | CNY |
Short Term Investments [Line Items] | ' | ' | ' | ' |
Time Deposits | $5.40 | 33 | $5.40 | 33 |
Accounts_and_notes_receivable_2
Accounts and notes receivable, net (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Financing Receivables [Line Items] | ' | ' | ||
Accounts receivable - unrelated parties | $131,134 | [1] | $140,920 | [1] |
Notes receivable - unrelated parties | 151,926 | [2],[3] | 128,068 | [2],[3] |
Total accounts and notes receivable- unrelated parties | 283,060 | 268,988 | ||
Less: allowance for doubtful accounts - unrelated parties | -1,440 | -1,349 | ||
Accounts and notes receivable, net - unrelated parties | 281,620 | 267,639 | ||
Accounts and notes receivable, net - related parties | 22,253 | 17,194 | ||
Accounts and notes receivable, net | $303,873 | $284,833 | ||
[1] | As of September 30, 2014 and December 31, 2013, the Company has pledged $11.0 million and $19.1 million, respectively, of accounts receivable as security for its comprehensive credit facilities with banks in China. | |||
[2] | Notes receivable represent accounts receivable in the form of bills of exchange for which acceptances are guaranteed and settlements are handled by banks. | |||
[3] | As of September 30, 2014, Henglong collateralized its notes receivable in an amount of RMB229.2 million (equivalent to approximately $37.3 million) as security for the credit facilities with banks in China and the Chinese government, including RMB197.8 million (equivalent to approximately $32.2 million) in favor of Industrial and Commercial Bank of China, Jingzhou Branch, “ICBC Jingzhou,†for the purpose of obtaining the Henglong Standby Letter of Credit (as defined in Note 14) which is used as security for the non-revolving credit facility in the amount of $30.0 million provided by Industrial and Commercial Bank of China (Macau) Limited, “ICBC Macau,†and RMB31.4 million (equivalent to approximately $5.1 million) in favor of the Chinese government as security for the low-interest government loan (See Note 14). As of December 31, 2013, Henglong collateralized its notes receivable in an amount of RMB196.3 million (equivalent to approximately $32.2 million) in favor of Industrial and Commercial Bank of China, Jingzhou Branch, “ICBC Jingzhou,†for the purpose of obtaining the Henglong Standby Letter of Credit (as defined in Note 14) which is used as security for the non-revolving credit facility in the amount of $30.0 million provided by Industrial and Commercial Bank of China (Macau) Limited, “ICBC Macau.†|
Accounts_and_notes_receivable_3
Accounts and notes receivable, net (Details Textual) | Sep. 30, 2014 | Dec. 31, 2013 | 22-May-12 | 22-May-12 | Sep. 30, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 |
In Millions, unless otherwise specified | USD ($) | USD ($) | USD ($) | CNY | Henglongs Collateralization [Member] | Henglongs Collateralization [Member] | Henglongs Collateralization [Member] | Henglongs Collateralization [Member] | Jingzhou Henglong Automotive Parts Co Ltd [Member] | Jingzhou Henglong Automotive Parts Co Ltd [Member] | ICBC Macau [Member] | ICBC Macau [Member] |
USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | USD ($) | CNY | |||||
Financing Receivables [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Financing Receivable, Net | ' | ' | $32.20 | 197.8 | $37.30 | 229.2 | $32.20 | 196.3 | $32.20 | 197.8 | $5.10 | 31.4 |
Non Revolving Credit Facility | 30 | 30 | 30 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accounts Receivable Pledged As Security Value | $11 | $19.10 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Inventories_Details
Inventories (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Inventory [Line Items] | ' | ' |
Raw materials | $18,137 | $12,185 |
Work in process | 13,462 | 8,079 |
Finished goods | 41,092 | 31,128 |
Total | $72,691 | $51,392 |
Inventories_Details_Textual
Inventories (Details Textual) (USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Inventory [Line Items] | ' | ' |
Valuation Allowances and Reserves, Adjustments | $2.50 | $0.50 |
Other_receivables_net_Details
Other receivables, net (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Unrelated Parties [Member] | ' | ' | ||
Other Receivables [Line Items] | ' | ' | ||
Other receivables | $653 | [1] | $314 | [1] |
Less: allowance for doubtful accounts | -108 | -62 | ||
Subtotal | 545 | 252 | ||
Other receivables - employee housing loans | 839 | [2] | 0 | [2] |
DiviDividend receivables - affiliated company | 508 | [3] | 0 | [3] |
Other receivables | 1,892 | 252 | ||
Related Parties [Member] | ' | ' | ||
Other Receivables [Line Items] | ' | ' | ||
Other receivables | 711 | [1] | 729 | [1] |
Less: allowance for doubtful accounts | -663 | -621 | ||
Other receivables | $48 | $108 | ||
[1] | Other receivables consist of amounts advanced to both related and unrelated parties, primarily as unsecured demand loans, with no stated interest rate or due date. These receivables originate as part of the Company's normal operating activities and are periodically settled in cash. | |||
[2] | On May 28, 2014, the board of directors of the Company approved a loan program under which the Company will lend an aggregate of up to RMB50.0 million (equivalent to approximately $8.1 million) to the employees of the Company to assist them in purchasing houses. Employees are required to pay interest at an annual rate of 6.4%. The term of the loans is generally for five years. The Company accounts for employee loans to be repaid within 12 months from the ending date of reporting period in Advance payments and others - unrelated parties and loans to be repaid in more than 12 months in Other receivables - unrelated parties. As of September 30, 2014, total loans to employees under this program were $1.1 million, consisting of $0.8 million included in Other receivables - unrelated parties and $0.3 million included in Advance payments and others - unrelated parties in the accompanying condensed unaudited consolidated balance sheets. | |||
[3] | Beijing Henglong declared a dividend with a total amount of approximately $1 million, of which $0.5 million was payable to the Company. |
Other_receivables_net_Details_
Other receivables, net (Details Textual) | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | 28-May-14 | 28-May-14 | Sep. 30, 2014 |
In Millions, unless otherwise specified | USD ($) | Unrelated Parties [Member] | Beijing Henglong [Member] | Board of Directors Chairman [Member] | Board of Directors Chairman [Member] | Board of Directors Chairman [Member] |
USD ($) | USD ($) | USD ($) | CNY | USD ($) | ||
Financing Receivables [Line Items] | ' | ' | ' | ' | ' | ' |
Loans Assumed | ' | ' | ' | $8.10 | 50 | ' |
Other Receivables | ' | ' | ' | ' | ' | 0.8 |
Dividends Payable | ' | ' | 0.5 | ' | ' | ' |
Other Receivables Prepaid Expense And Other Assets | ' | ' | ' | ' | ' | 1.1 |
Dividends Declared Amount | 0.8 | ' | 1 | ' | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | ' | ' | ' | ' | ' | 6.40% |
Prepaid Expense | ' | $0.30 | ' | ' | ' | ' |
Assets_held_for_sale_Details_T
Assets held for sale (Details Textual) (USD $) | 9 Months Ended | 9 Months Ended | |||||
Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Apr. 14, 2014 | |||
sqm | Jingzhou Land Reserve Center [Member] | Jingzhou Land Reserve Center [Member] | Jingzhou Land Reserve Center [Member] | ||||
Long Lived Assets Held-for-sale [Line Items] | ' | ' | ' | ' | ' | ||
Area of Land | 136,392 | ' | ' | ' | ' | ||
Land Available-for-sale | $13,000,000 | ' | ' | ' | ' | ||
Accounts Receivable, Gross | 131,134,000 | [1] | 140,920,000 | [1] | 1,900,000 | ' | ' |
Proceeds from Sale of Intangible Assets | ' | ' | 6,500,000 | 4,600,000 | ' | ||
Disposal Group, Including Discontinued Operation, Long Lived Assets | ' | ' | ' | ' | 8,400,000 | ||
Gain (Loss) on Disposition of Intangible Assets | $7,500,000 | ' | ' | ' | ' | ||
[1] | As of September 30, 2014 and December 31, 2013, the Company has pledged $11.0 million and $19.1 million, respectively, of accounts receivable as security for its comprehensive credit facilities with banks in China. |
Long_term_investments_Details_
Long term investments (Details Textual) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | 30-May-14 | Jan. 24, 2010 | Sep. 30, 2014 | |
Beijing Henglong Automotive System Co Ltd [Member] | Beijing Henglong Automotive System Co Ltd [Member] | Beijing Henglong [Member] | ||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Long-term investments | $3,660,000 | ' | $3,660,000 | ' | $4,023,000 | ' | ' | ' |
Equity Method Investments | ' | ' | ' | ' | ' | ' | 3,100,000 | ' |
Equity in earnings of affiliated companies | 82,000 | 125,000 | 220,000 | 251,000 | ' | ' | ' | ' |
Dividends Payable | ' | ' | ' | ' | ' | ' | ' | 500,000 |
Dividends Receivable Current And Noncurrent | ' | ' | ' | ' | ' | ' | ' | 500,000 |
Dividends Declared Amount | $800,000 | ' | $800,000 | ' | ' | $1,000,000 | ' | $1,000,000 |
Property_plant_and_equipment_n2
Property, plant and equipment, net (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Total amount of property, plant and equipment | $181,342 | [1] | $169,913 | [1] |
Less: Accumulated depreciation | -99,632 | [2] | -89,895 | [2] |
Total amount of property, plant and equipment, net | 81,710 | [3] | 80,018 | [3] |
Land Use Rights and Buildings [Member] | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Total amount of property, plant and equipment | 47,141 | 43,849 | ||
Machinery and Equipment [Member] | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Total amount of property, plant and equipment | 116,592 | 110,322 | ||
Electronic Equipment [Member] | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Total amount of property, plant and equipment | 7,590 | 7,414 | ||
Motor Vechicles [Member] | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Total amount of property, plant and equipment | 4,043 | 3,195 | ||
Construction in Progress [Member] | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Total amount of property, plant and equipment | $5,976 | $5,133 | ||
[1] | Through the acquisition of Fujian Qiaolong in the second quarter of 2014, the Company acquired $3.7 million of property, plant and equipment, consisting of $3.4 million of land use rights and buildings, $0.2 million of machinery and equipment, and $0.1 million of motor vehicles, which are depreciated over a weighted average life of 43.0 years, 3.5 years, and 3.1 years, respectively. | |||
[2] | Depreciation charges were $3.7 million and $3.7 million for the three months ended September 30, 2014 and 2013, respectively, and $11.4 million and $10.8 million for the nine months ended September 30, 2014 and 2013, respectively. | |||
[3] | As of September 30, 2014 and December 31, 2013, the Company had pledged property, plant and equipment with net book value of $46.8 million and $51.4 million, respectively, for its comprehensive credit facilities with banks in China. |
Property_plant_and_equipment_n3
Property, plant and equipment, net (Details Textual) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 3 Months Ended | 3 Months Ended | 3 Months Ended | ||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Jun. 30, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2014 | |
Property, Plant and Equipment [Member] | Property, Plant and Equipment [Member] | Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | |||||
Land and Building [Member] | Land and Building [Member] | Machinery and Equipment [Member] | Machinery and Equipment [Member] | Vehicles [Member] | Vehicles [Member] | |||||||||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | ' | ' | ' | ' | ' | ' | $3,694,000 | $3,700,000 | ' | $3,400,000 | ' | $200,000 | ' | $100,000 |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | ' | ' | ' | ' | ' | ' | '4 years 8 months 12 days | ' | '43 years | ' | '3 years 6 months | ' | '3 years 1 month 6 days | ' |
Depreciation, Nonproduction | 3,700,000 | 3,700,000 | 11,400,000 | 10,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Pledged Assets Separately Reported, Loans Pledged as Collateral, at Fair Value | ' | ' | ' | ' | $46,800,000 | $51,400,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible_assets_Details
Intangible assets (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Costs: | ' | ' | ||
Patent technology | $3,073 | $2,067 | ||
Management software license | 784 | 699 | ||
Total intangible assets | 3,857 | [1] | 2,766 | [1] |
Less: Amortization | -2,285 | [2] | -2,080 | [2] |
Total intangible assets, net | $1,572 | $686 | ||
[1] | Through the acquisition of Fujian Qiaolong in the second quarter of 2014, the Company acquired $0.9 million of intangible assets, consisting of $0.9 million of patent technology and $nil of management software licenses, which are amortized over a weighted average life of 4.7 years and 1.1 years, respectively. | |||
[2] | Amortization expenses were $0.1 million and $0.04 million for the three months ended September 30, 2014 and 2013, respectively, and $0.2 million and $0.1 million for the nine months ended September 30, 2014 and 2013, respectively. |
Intangible_assets_Details_Text
Intangible assets (Details Textual) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 6 Months Ended | |||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Jun. 30, 2014 | Jun. 30, 2014 | Jun. 30, 2014 | |
Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | |||||
Patented Technology [Member] | Computer Software, Intangible Asset [Member] | ||||||
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill | ' | ' | ' | ' | $864,000 | $900,000 | $0 |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | ' | ' | ' | ' | '4 years 8 months 12 days | '4 years 8 months 12 days | '1 year 1 month 6 days |
Amortization of Intangible Assets | $100,000 | $40,000 | $200,000 | $100,000 | ' | ' | ' |
Deferred_income_tax_assets_Det
Deferred income tax assets (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Deferred Tax Assets [Line Items] | ' | ' | ||
Losses carry forward (U.S.) | $7,047 | [1] | $6,825 | [1] |
Losses carry forward (PRC) | 2,126 | [1] | 1,838 | [1] |
Product warranties and other reserves | 4,421 | 4,207 | ||
Property, plant and equipment | 4,558 | 4,346 | ||
Share-based compensation | 266 | 296 | ||
Bonus accrual | 359 | 557 | ||
Other accruals | 992 | 850 | ||
Others | 1,036 | 1,103 | ||
Total deferred tax assets | 20,805 | 20,022 | ||
Less: taxable temporary difference related to revenue recognition | -389 | -793 | ||
Total deferred tax assets, net | 20,416 | 19,229 | ||
Less: Valuation allowance | -9,237 | -8,918 | ||
Total deferred tax assets, net of valuation allowance | $11,179 | [2] | $10,311 | [2] |
[1] | The net operating losses carry forward for the U.S. entity for income tax purposes are available to reduce future years' taxable income. These losses will expire, if not utilized, in 20 years. Net operating losses carry forward for non-U.S. entities can be carried forward for 5 years to offset taxable income. However, as of September 30, 2014 and December 31, 2013, the valuation allowance was $9.2 million and $8.9 million, respectively, including $7.3 million and $7.3 million, respectively, allowance for the Company’s deferred tax assets in the United States and $1.9 million and $1.7 million, respectively, allowance for the Company’s non-U.S. deferred tax assets. Based on the Company’s current operations in the United States, management believes that the deferred tax assets in the United States are not likely to be realized in the future. For the non-U.S. deferred tax assets, pursuant to certain tax laws and regulations in China, the management believes such amount will not be used to offset future taxable income. | |||
[2] | Approximately $4.8 million and $4.5 million of net deferred income tax asset as of September 30, 2014 and December 31, 2013, respectively, are included in non-current deferred tax assets in the accompanying condensed unaudited consolidated balance sheets. The remaining $6.4 million and $5.8 million of net deferred income tax assets as of September 30, 2014 and December 31, 2013, respectively, are included in current deferred tax assets. |
Deferred_income_tax_assets_Det1
Deferred income tax assets (Details Textual) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | U.S [Member] | U.S [Member] | Non U.S [Member] | Non U.S [Member] | |||
Deferred Tax Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Deferred Tax Assets, Valuation Allowance | $9,237 | $8,918 | ' | $7,300 | $7,300 | $1,900 | $1,700 |
Deferred Tax Assets, Net of Valuation Allowance, Noncurrent | 4,760 | 4,528 | 5,200 | ' | ' | ' | ' |
Current deferred tax assets | $6,419 | $5,783 | ' | ' | ' | ' | ' |
Amortizing Period Of Net Operating Loss | ' | ' | ' | '20 years | ' | '5 years | ' |
Bank_and_government_loans_net_1
Bank and government loans, net (Details) | 9 Months Ended | 12 Months Ended | ||||||||||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Mar. 28, 2014 | Mar. 28, 2014 | Dec. 31, 2013 | ||||||
USD ($) | USD ($) | China Construction Bank [Member] | China Construction Bank [Member] | ICBC Macau [Member] | ICBC Macau [Member] | Chinese government loan [Member] | Chinese government loan [Member] | Chinese government loan [Member] | Chinese government loan [Member] | |||||||
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | CNY | USD ($) | |||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||
Short-term bank loan | ' | ' | $5,689 | [1],[2] | $7,381 | [1],[2] | $35,000 | [3],[4] | $30,000 | [3],[4] | $4,876 | [5] | $4,900 | 30,000 | $0 | [5] |
Subtotal | 45,565 | 37,381 | ' | ' | ' | ' | ' | ' | ' | ' | ||||||
Debt issue cost | 0 | -57 | ' | ' | ' | ' | ' | ' | ' | ' | ||||||
Amortization | 0 | 57 | ' | ' | ' | ' | ' | ' | ' | ' | ||||||
Bank and government loans, net | $45,565 | $37,381 | ' | ' | ' | ' | ' | ' | ' | ' | ||||||
[1] | These loans are secured by property, plant and equipment of the Company and are repayable within one year (see Note 11). As of September 30, 2014 and December 31, 2013, the weighted average interest rate was 6.65% and 6.22% per annum, respectively. Interest is paid on the twentieth day of each month and the principal repayment is at maturity. | |||||||||||||||
[2] | On July 18, 2013, Jiulong entered into a one-year loan agreement with China Construction Bank Jingzhou branch in the amount of $1.6 million. The agreement contains certain financial and non-financial covenants, including but not limited to restrictions on the utilization of the funds and the maintenance of an asset-liability ratio not exceeding 60%. The loan was repaid on July 17, 2014. | |||||||||||||||
[3] | On May 18, 2012, the Company entered into a credit facility agreement, the “Credit Agreement,†with ICBC Macau to obtain a non-revolving credit facility in the amount of $30.0 million, the “Credit Facilityâ€. The Credit Facility would have expired on November 3, 2012 unless the Company drew down the line of credit in full prior to such expiration date, and the maturity date for the loan drawdown was the earlier of (i) 18 months from the drawdown or (ii) 1 month before the expiry of the standby letter of credit obtained by Henglong from ICBC Jingzhou as security for the Credit Facility, the “Henglong Standby Letter of Creditâ€. The interest rate of the Credit Facility is calculated based on a three-month LIBOR plus 2.25% per annum, subject to the availability of funds and fluctuation at ICBC Macau’s discretion. The interest is calculated daily based on a 360-day year and it is fixed one day before the first day of each interest period. The interest period is defined as three months from the date of drawdown. As security for the Credit Facility, the Company was required to provide ICBC Macau with the Henglong Standby Letter of Credit for a total amount not less than $31.6 million if the Credit Facility is fully drawn. On May 22, 2012, the Company drew down the full amount of $30.0 million under the Credit Facility and provided the Henglong Standby Letter of Credit for an amount of $31.6 million in favor of ICBC Macau. The Henglong Standby Letter of Credit issued by ICBC Jingzhou is collateralized by Henglong’s notes receivable of RMB197.8 million (equivalent to approximately $32.2 million). The Company also paid an arrangement fee of $0.1 million to ICBC Macau and $0.1 million to ICBC Jingzhou. The original maturity date of the Credit Facility was May 22, 2013. On May 7, 2013, ICBC Macau agreed to extend the maturity date of the Credit Facility to May 13, 2014. The interest rate of the Credit Facility under the extended term is revised as the three-month LIBOR plus 2.0% per annum, Except for the above, all other terms and conditions as stipulated in the Credit Agreement remain unchanged. On May 13, 2014, ICBC Macau agreed to extend the maturity date of the Credit Facility to May 12, 2015. The interest rate of the Credit Facility under the extended term is revised as the three-month LIBOR plus 2.55% per annum. Except for the above, all other terms and conditions as stipulated in the Credit Agreement remain unchanged. As of September 30, 2014, the interest rate of the Credit Facility was 2.80% per annum (See Note 6). | |||||||||||||||
[4] | On July 16, 2014, Great Genesis entered into a credit facility agreement with HSBC HK to obtain a non-revolving credit facility in the amount of $5.0 million, the “HSBC Credit Facilityâ€. The HSBC Credit Facility will expire on July 1, 2015, and has an annual interest rate of 1.7%. Interest is paid on the twentieth day of each month and the principal repayment is at maturity. As security for the HSBC Credit Facility, the Company’s subsidiary Hubei Henglong was required to provide HSBC HK with the Standby Letter of Credit for a total amount of not less than $5.4 million if the HSBC Credit Facility is fully drawn. On July 22, 2014, Great Genesis drew down a loan amounting to $5.0 million provided by HSBC HK and Hubei Henglong provided a Standby Letter of Credit for an amount of $5.4 million in favor of HSBC HK. Hubei Henglong’s Standby Letter of Credit was issued by HSBC Bank (China) Company Limited Wuhan branch and is collateralized by short-term investments of Hubei Henglong of RMB33.0 million (equivalent to approximately $5.4 million). | |||||||||||||||
[5] | On March 28, 2014, the Company received a Chinese government loan of RMB30.0 million (equivalent to approximately $4.9 million), with an interest rate of 3% per annum, The government loan, will mature on March 15, 2015. Henglong has pledged RMB31.4 million (equivalent to approximately $5.1 million) of notes receivable as security for such government loan (See Note 6). |
Bank_and_government_loans_net_2
Bank and government loans, net (Details Textual) | 0 Months Ended | 1 Months Ended | 9 Months Ended | 1 Months Ended | 1 Months Ended | |||||||||||||||||
13-May-14 | 7-May-13 | 18-May-12 | Sep. 30, 2014 | Dec. 31, 2013 | 22-May-12 | 22-May-12 | 22-May-12 | 18-May-12 | 22-May-12 | Jul. 18, 2013 | Sep. 30, 2014 | Mar. 28, 2014 | Mar. 28, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Jul. 22, 2014 | Jul. 22, 2014 | Jul. 16, 2014 | |||
USD ($) | USD ($) | USD ($) | CNY | Industrial and Commercial Bank Of China Macau [Member] | Industrial and Commercial Bank Of China Macau [Member] | Industrial and Commercial Bank Of China Jingzhou Branch [Member] | China Construction Bank Jingzhou Branch [Member] | Chinese government loan [Member] | Chinese government loan [Member] | Chinese government loan [Member] | Chinese government loan [Member] | HSBC Bank China Company Limited [Member] | HSBC Bank China Company Limited [Member] | HSBC Bank China Company Limited [Member] | HSBC Bank China Company Limited [Member] | HSBC Bank China Company Limited [Member] | ||||||
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | CNY | USD ($) | USD ($) | CNY | USD ($) | CNY | USD ($) | ||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Short-term Debt, Weighted Average Interest Rate | ' | ' | ' | 6.65% | 6.22% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Short-term Non-bank Loans and Notes Payable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Non Revolving Credit Facility | ' | ' | ' | 30,000,000 | 30,000,000 | 30,000,000 | ' | ' | 30,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | 5,000,000 | ' | 5,000,000 | ||
Line of Credit Facility, Description | 'LIBOR plus 2.55% per annum | 'LIBOR plus 2.0% per annum | 'LIBOR plus 2.25% per annum | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Line of Credit Facility, Interest Rate at Period End | ' | ' | ' | 2.80% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.70% | ||
Financing Receivable, Net | ' | ' | ' | ' | ' | 32,200,000 | 197,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Arrangement Fee | ' | ' | ' | ' | ' | ' | ' | 100,000 | ' | 100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Asset Liability Ratio | ' | ' | ' | 60.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Line of Credit, Current | ' | ' | ' | ' | ' | ' | ' | 31,600,000 | 31,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | 5,400,000 | ' | 5,400,000 | ||
Debt Instrument, Maturity Date | ' | ' | ' | 15-Mar-15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||
Short-term Debt, Total | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,876,000 | [1] | 4,900,000 | 30,000,000 | 0 | [1] | ' | ' | ' | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.00% | 3.00% | ' | ' | ' | ' | ' | ' | ||
Notes, Loans and Financing Receivable, Net, Current, Total | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,100,000 | 31,400,000 | ' | ' | ' | ' | ' | ' | ||
Time Deposits | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $5,400,000 | 33,000,000 | $5,400,000 | 33,000,000 | ' | ||
[1] | On March 28, 2014, the Company received a Chinese government loan of RMB30.0 million (equivalent to approximately $4.9 million), with an interest rate of 3% per annum, The government loan, will mature on March 15, 2015. Henglong has pledged RMB31.4 million (equivalent to approximately $5.1 million) of notes receivable as security for such government loan (See Note 6). |
Accounts_and_notes_payable_Det
Accounts and notes payable (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Accounts And Notes Payable [Line Items] | ' | ' | ||
Accounts payable - unrelated parties | $129,420 | $120,202 | ||
Notes payable - unrelated parties | 73,977 | [1] | 78,217 | [1] |
Total accounts and notes payable - unrelated parties | 203,397 | 198,419 | ||
Accounts and notes payable - related parties | 3,837 | 4,634 | ||
Total accounts and notes payable | $207,234 | $203,053 | ||
[1] | Notes payable represent accounts payable in the form of bills of exchange whose acceptances are guaranteed and settlements are handled by banks. The Company has pledged cash deposits, notes receivable and certain property, plant and equipment to secure notes payable granted by banks. |
Accrued_expenses_and_other_pay2
Accrued expenses and other payables (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Accrued Expenses [Line Items] | ' | ' | ||
Accrued expenses | $5,180 | $4,980 | ||
Accrued interest | 125 | 85 | ||
Other payables | 1,480 | 1,858 | ||
Dividends payable to common shareholders | 757 | [1] | 0 | [1] |
Dividends payable to non-controlling interests | 4,063 | [2] | 35 | [2] |
Amount payable for acquisition of non-controlling interests (See Note 19) | 37,314 | 0 | ||
Warranty reserves | 24,421 | [3] | 22,104 | [3] |
Total | $73,340 | $29,062 | ||
[1] | On May 27, 2014, the Company announced the payment of a special cash dividend of $0.18 per common share to the Company’s shareholders of record as of the close of business on June 26, 2014. As of September 30, 2014, dividends payable of $0.8 million remained unpaid. | |||
[2] | In accordance with the resolution of the board of directors of Henglong, in June 2014, Henglong declared a dividend amounting to $40.6 million to its shareholders, of which $8.1 million was payable to the holder of the non-controlling interests. As of September 30, 2014, dividends payable of $4.1 million have not yet been paid to the holder of the non-controlling interests. | |||
[3] | 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. |
Accrued_expenses_and_other_pay3
Accrued expenses and other payables (Details 1) (USD $) | 9 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Accrued Expenses [Line Items] | ' | ' | ' |
Balance at beginning of the period | $22,104 | $18,081 | $18,081 |
Additions during the period | 8,333 | 8,554 | 12,707 |
Settlement within period, by cash or actual material | -5,816 | -6,199 | -9,244 |
Foreign currency translation gain (loss) | -200 | 404 | 560 |
Balance at end of the period | $24,421 | $20,840 | $22,104 |
Accrued_expenses_and_other_pay4
Accrued expenses and other payables (Details Textual) (USD $) | 6 Months Ended | |
In Millions, except Per Share data, unless otherwise specified | Jun. 30, 2014 | Sep. 30, 2014 |
Accrued Expenses [Line Items] | ' | ' |
Common Stock, Dividends, Per Share, Declared | $0.18 | ' |
Dividend Payable To Non Controlling Interest | $8.10 | $4.10 |
Dividends Declared Amount | ' | 0.8 |
Henglong [Member] | ' | ' |
Accrued Expenses [Line Items] | ' | ' |
Dividends Declared Amount | $40.60 | ' |
Taxes_payable_Details
Taxes payable (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Taxes Payable [Line Items] | ' | ' |
Value-added tax payable | $2,658 | $5,494 |
Income tax payable | 5,697 | 1,841 |
Other tax payable | 182 | 457 |
Total | $8,537 | $7,792 |
Advances_payable_Details_Textu
Advances payable (Details Textual) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Advance Payable [Line Items] | ' | ' |
Advances payable | $2,875 | $2,764 |
Additional_paidin_capital_Deta
Additional paid-in capital (Details) (USD $) | 9 Months Ended | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | |||
Schedule Of Additional Paid In Capital [Line Items] | ' | ' | ' | |||
Balance at beginning of the period | $39,565 | $39,371 | $39,371 | |||
Return of common shareholders' investment cost | -5,047 | [1] | 0 | [1] | 0 | [1] |
Acquisition of the non-controlling interests in Henglong and Jiulong | -7,502 | [2] | 0 | [2] | 0 | [2] |
Stock-based compensation | 193 | [3] | 194 | [3] | 194 | [3] |
Balance at end of the period | $27,209 | $39,565 | $39,565 | |||
[1] | On May 27, 2014, the Company announced a special cash dividend of $0.18 per common share to the Company’s shareholders of record as of the close of business on June 26, 2014. As China Automotive Systems, the parent company, had an accumulated deficit position as of the date of the dividend declaration, the dividends distributed to the Company’s common shareholders described above are treated as a return of common shareholders’ investment cost. | |||||
[2] | On August 11, 2014, the Company entered into the Exchange Agreement with Jiulong Machinery Electricity, under which the Company issued 3,260,000 and 818,000 of its common shares in consideration for the acquisition of the 20% and 19% equity interests in Henglong and Jiulong, respectively, held by Jiulong Machinery Electricity. On September 26, 2014, the Company obtained the 20% and 19% equity interests in Henglong and Jiulong, respectively, and completed its share registrations with the local government administrative bureau. The Company owned 100% of the equity interests in both Henglong and Jiulong as of September 30, 2014. The Company’s acquisitions of the non-controlling interests were accounted for as equity transactions in the quarter ended September 30, 2014. The total carrying value for the non-controlling interests in both Henglong and Jiulong was $34.5 million, including the accumulated other comprehensive income of $4.7 million related to the noncontrolling interests acquired. Therefore, the total carrying value of $34.5 million for the non-controlling interests acquired was reclassified from non-controlling interests to the controlling interest’s equity as of September 30, 2014. The fair market value of the Company’s common stock issued was $37.3 million or $9.15 per share, which was determined on the issuance date of the common shares. The difference between the fair market value of $37.3 million for the Company’s common shares issued and the carrying value of $34.5 million for the non-controlling interest acquired of $2.8 million was recorded as a reduction of additional paid-in capital. Additional paid-in capital of the Company was also decreased by $4.7 million and the accumulated other comprehensive income attributable to Henglong and Jiulong was increased by a corresponding amount. On October 13, 2014, the Company completed its issuance of 4,078,000 common shares to nominee holders designated by Jiulong Machinery Electricity (See Note 32). | |||||
[3] | On September 16, 2014 and August 13, 2013, the Company granted 22,500 and 22,500 stock options, respectively, to the Company’s independent directors, with the exercise price equal to the closing price of the Company’s common stock traded on NASDAQ on the date of grant. The fair value of stock options was determined at the date of grant using the Black-Scholes option pricing model. The Black-Scholes option model requires management to make various estimates and assumptions, including expected term, expected volatility, risk-free rate and dividend yield. The expected term represents the period of time that stock-based compensation awards granted are expected to be outstanding and is estimated based on considerations including the vesting period, contractual term and anticipated employee exercise patterns. Expected volatility is based on the historical volatility of the Company’s stock. The risk-free rate is based on the U.S. Treasury yield curve in relation to the contractual life of stock-based compensation instruments. The dividend yield assumption is based on historical patterns and future expectations for the Company’s dividends. |
Additional_paidin_capital_Deta1
Additional paid-in capital (Details 1) | 9 Months Ended |
Sep. 30, 2014 | |
September 16, 2014 [Member] | ' |
Schedule Of Additional Paid In Capital [Line Items] | ' |
Stock Option Issuance Date | 16-Sep-14 |
Expected volatility | 120.60% |
Risk-free rate | 1.78% |
Expected term (years) | '5 years |
Dividend yield | 0.00% |
August 13, 2013 [Member] | ' |
Schedule Of Additional Paid In Capital [Line Items] | ' |
Stock Option Issuance Date | 13-Aug-13 |
Expected volatility | 131.50% |
Risk-free rate | 1.49% |
Expected term (years) | '5 years |
Dividend yield | 0.00% |
Additional_paidin_capital_Deta2
Additional paid-in capital (Details Textual) (USD $) | 0 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | 0 Months Ended | 9 Months Ended | |||||
Sep. 16, 2014 | Aug. 13, 2013 | Jun. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Aug. 11, 2014 | Aug. 11, 2014 | Oct. 13, 2014 | Aug. 11, 2014 | Sep. 30, 2014 | |
Henglong [Member] | Jiulong [Member] | Jiulong Machinery Electricity [Member] | Henglong and Jiulong [Member] | Henglong and Jiulong [Member] | |||||||
Private Placement [Member] | Private Placement [Member] | ||||||||||
Schedule Of Additional Paid In Capital [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock, Dividends, Per Share, Declared | ' | ' | $0.18 | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 22,500 | 22,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Allocated Share-based Compensation Expense | ' | ' | ' | $200,000 | $200,000 | ' | ' | ' | ' | ' | ' |
Sharebased Compensation Arrangement By Sharebased Payment Award OptionsExercisableGrantDateFairValue | 200,000 | 200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business Acquisition Cost Of Non Controlling Interest | ' | ' | ' | ' | ' | ' | ' | ' | ' | 34,500,000 | ' |
Stock Issued During Period, Shares, Acquisitions | ' | ' | ' | ' | ' | ' | 3,260,000 | 818,000 | ' | ' | ' |
Equity Method Investment, Ownership Percentage | ' | ' | ' | ' | ' | ' | 20.00% | 19.00% | ' | ' | ' |
Stock Issued During Period, Value, Acquisitions | ' | ' | ' | ' | ' | ' | ' | ' | ' | 37,300,000 | ' |
Sale of Stock, Price Per Share | ' | ' | ' | ' | ' | ' | ' | ' | ' | $9.15 | ' |
Adjustments to Additional Paid in Capital, Other | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,800,000 |
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, Adjustment, before Tax, Portion Attributable to Noncontrolling Interest | ' | ' | ' | $4,743,000 | $0 | $0 | ' | ' | ' | ' | $4,700,000 |
Business Combination Consideration Transferred Equity Interests Issued | ' | ' | ' | ' | ' | ' | ' | ' | 4,078,000 | ' | ' |
Retained_earnings_Details
Retained earnings (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Retained Earnings, Appropriated [Member] | Retained Earnings, Appropriated [Member] | Retained Earnings, Appropriated [Member] | Retained Earnings, Unappropriated [Member] | Retained Earnings, Unappropriated [Member] | Retained Earnings, Unappropriated [Member] | |||||
Retained Earnings Adjustments [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at beginning of the period | ' | ' | $146,023 | ' | $10,048 | $9,953 | $9,953 | $146,023 | $119,329 | $119,329 |
Net income attributable to parent company | 6,733 | 8,624 | 24,514 | 19,544 | ' | ' | ' | 24,514 | 19,544 | 26,789 |
Appropriation of retained earnings | ' | ' | ' | ' | 130 | 95 | 95 | -130 | -95 | -95 |
Balance at end of the period | $170,407 | ' | $170,407 | ' | $10,178 | $10,048 | $10,048 | $170,407 | $138,778 | $146,023 |
Retained_Earnings_Details_Text
Retained Earnings (Details Textual) | 9 Months Ended | ||||||||||||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 |
Jingzhou Henglong Automotive Parts Co Ltd [Member] | Shashi Jiulong Power Steering Gears Co Ltd [Member] | Shashi Jiulong Power Steering Gears Co Ltd [Member] | Shenyang Jinbei Henglong Automotive Steering System Co Ltd [Member] | Shenyang Jinbei Henglong Automotive Steering System Co Ltd [Member] | Universal Sensor Application Inc [Member] | Wuhan Jielong Electric Power Steering Co Ltd [Member] | Wuhu Henglong Auto Steering System Co Ltd [Member] | Wuhu Henglong Auto Steering System Co Ltd [Member] | Hubei Henglong Automotive System Group Co Ltd [Member] | Chongqing Henglong Hongyan Automotive Systems Co Ltd [Member] | Chongqing Henglong Hongyan Automotive Systems Co Ltd [Member] | ||
USD ($) | USD ($) | CNY | USD ($) | CNY | USD ($) | USD ($) | USD ($) | CNY | USD ($) | USD ($) | CNY | ||
Retained Earnings Adjustments [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Statutory Accounting Practices Statutory Surplus Required Percentage | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Statutory Accounting Practices, Statutory Capital and Surplus Required | ' | $10 | $4.20 | 35 | $8.10 | 67.5 | $2.60 | $6 | $3.80 | 30 | $39 | $9.50 | 60 |
Percentage Of Statutory Surplus Reserve | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accumulated_other_comprehensiv2
Accumulated other comprehensive income (Details) (USD $) | 9 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' |
Balance at beginning of the period | $32,061 | $25,898 | $25,898 |
Other comprehensive income related to the non-controlling interests acquired by the Company (See Note 19) | 4,743 | 0 | 0 |
Foreign currency translation adjustment attributable to parent company | -2,010 | 4,374 | 6,163 |
Balance at end of the period | $34,794 | $30,272 | $32,061 |
Noncontrolling_interests_Detai
Non-controlling interests (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | |||
Noncontrolling Interests Disclosure [Line Items] | ' | ' | ' | ' | ' | |||
Balance at beginning of the period | ' | ' | $45,071 | $38,846 | $38,846 | |||
Fair value of the non-controlling interests arising from the acquisition of Fujian Qiaolong | ' | ' | 2,793 | [1] | 0 | [1] | 0 | [1] |
Acquisition of the non-controlling interests in Henglong and Jiulong (See Note 19) | ' | ' | -7,502 | [2] | 0 | [2] | 0 | [2] |
Other comprehensive income related to the non-controlling interests acquired by the Company (See Note 19) | ' | ' | -4,743 | 0 | 0 | |||
Income attributable to non-controlling interests | 1,293 | 1,805 | 5,409 | 4,616 | 6,276 | |||
Dividends declared to the non-controlling interest holders of joint-venture companies (See Note 16) | ' | ' | -10,077 | -1,299 | -1,299 | |||
Foreign currency translation adjustment attributable to non-controlling interests | ' | ' | -403 | 892 | 1,248 | |||
Balance at end of the period | $8,238 | $43,055 | $8,238 | $43,055 | $45,071 | |||
[1] | In the second quarter of 2014, the Company acquired a 51.0% equity interest in Fujian Qiaolong (See Note 3). The fair value of the non-controlling interest of Fujian Qiaolong is $2.8 million. | |||||||
[2] | On August 11, 2014, the Company entered into the Exchange Agreement with Jiulong Machinery Electricity, under which the Company issued 3,260,000 and 818,000 of its common shares in consideration for the acquisition of the 20% and 19% equity interests in Henglong and Jiulong, respectively, held by Jiulong Machinery Electricity. On September 26, 2014, the Company obtained the 20% and 19% equity interests in Henglong and Jiulong, respectively, and completed its share registrations with the local government administrative bureau. The Company owned 100% of the equity interests in both Henglong and Jiulong as of September 30, 2014. The Company’s acquisitions of the non-controlling interests were accounted for as equity transactions in the quarter ended September 30, 2014. The total carrying value for the non-controlling interests in both Henglong and Jiulong was $34.5 million, including the accumulated other comprehensive income of $4.7 million related to the noncontrolling interests acquired. Therefore, the total carrying value of $34.5 million for the non-controlling interests acquired was reclassified from non-controlling interests to the controlling interest’s equity as of September 30, 2014. The fair market value of the Company’s common stock issued was $37.3 million or $9.15 per share, which was determined on the issuance date of the common shares. The difference between the fair market value of $37.3 million for the Company’s common shares issued and the carrying value of $34.5 million for the non-controlling interest acquired of $2.8 million was recorded as a reduction of additional paid-in capital. Additional paid-in capital of the Company was also decreased by $4.7 million and the accumulated other comprehensive income attributable to Henglong and Jiulong was increased by a corresponding amount. On October 13, 2014, the Company completed its issuance of 4,078,000 common shares to nominee holders designated by Jiulong Machinery Electricity (See Note 32). |
Noncontrolling_interests_Detai1
Non-controlling interests (Details Textual) (Fujian Qiaolong [Member], USD $) | 6 Months Ended |
In Thousands, unless otherwise specified | Jun. 30, 2014 |
Fujian Qiaolong [Member] | ' |
Noncontrolling Interests Disclosure [Line Items] | ' |
Noncontrolling Interest Increase Decrease from Business Combination Fair Value | $2,800 |
Business Acquisition, Percentage of Voting Interests Acquired | 51.00% |
Gain_on_other_sales_Details_Te
Gain on other sales (Details Textual) (USD $) | 6 Months Ended | 9 Months Ended |
In Millions, unless otherwise specified | Jun. 30, 2014 | Sep. 30, 2013 |
Gain on other sales disclosure [Line Items] | ' | ' |
Selling Price Of Land Use Right And Plant | $8.40 | $4.60 |
Net Book Value Of Land Use Right And Plant | 0.9 | 0.5 |
Gain On Sale Of Idle Use Right And Plant Before Tax | $7.50 | $4.10 |
Financial_income_net_Details
Financial income, net (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Financial Expenses [Line Items] | ' | ' | ' | ' |
Interest expense | ($728) | ($284) | ($1,552) | ($1,289) |
Interest income | 1,404 | 1,143 | 2,657 | 2,298 |
Foreign exchange loss, net | -63 | -24 | -62 | -71 |
Gain (loss) of cash discount, net | 3 | 3 | 65 | -9 |
Bank fees | -204 | -149 | -510 | -549 |
Total financial income, net | $412 | $689 | $598 | $380 |
Income_tax_rate_Details_Textua
Income tax rate (Details Textual) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||||||||||||||||
In Millions, unless otherwise specified | Jan. 31, 2008 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 | Dec. 31, 2008 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 | Dec. 31, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Sep. 30, 2014 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
USD ($) | BRL | USD ($) | Shashi Jiulong Power Steering Gears Co Ltd [Member] | Shashi Jiulong Power Steering Gears Co Ltd [Member] | Shashi Jiulong Power Steering Gears Co Ltd [Member] | Shashi Jiulong Power Steering Gears Co Ltd [Member] | Shashi Jiulong Power Steering Gears Co Ltd [Member] | Shashi Jiulong Power Steering Gears Co Ltd [Member] | Shashi Jiulong Power Steering Gears Co Ltd [Member] | Jingzhou Henglong Automotive Parts Co Ltd [Member] | Jingzhou Henglong Automotive Parts Co Ltd [Member] | Jingzhou Henglong Automotive Parts Co Ltd [Member] | Jingzhou Henglong Automotive Parts Co Ltd [Member] | Jingzhou Henglong Automotive Parts Co Ltd [Member] | Jingzhou Henglong Automotive Parts Co Ltd [Member] | Shenyang Jinbei Henglong Automotive Steering System Co Ltd [Member] | Shenyang Jinbei Henglong Automotive Steering System Co Ltd [Member] | Shenyang Jinbei Henglong Automotive Steering System Co Ltd [Member] | Shenyang Jinbei Henglong Automotive Steering System Co Ltd [Member] | Shenyang Jinbei Henglong Automotive Steering System Co Ltd [Member] | Shenyang Jinbei Henglong Automotive Steering System Co Ltd [Member] | Wuhan Jielong Electric Power Steering Co Ltd [Member] | Wuhan Jielong Electric Power Steering Co Ltd [Member] | Hubei Henglong Automotive System Group Co Ltd [Member] | Hubei Henglong Automotive System Group Co Ltd [Member] | Hubei Henglong Automotive System Group Co Ltd [Member] | Hubei Henglong Automotive System Group Co Ltd [Member] | Hubei Henglong Automotive System Group Co Ltd [Member] | Universal Sensor Application Inc [Member] | Universal Sensor Application Inc [Member] | Universal Sensor Application Inc [Member] | Universal Sensor Application Inc [Member] | Universal Sensor Application Inc [Member] | Hong Kong Enterprise [Member] | Chongqing Henglong Hongyan Automotive Systems Co Ltd [Member] | CAAS Brazils Imports and Trade In Automotive Parts Ltd [Member] | United States [Member] | Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | Fujian Qiaolong Acquisition [Member] | |||||
2015 [Member] | USD ($) | ||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Tax rate | ' | ' | ' | 35.00% | 35.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 35.00% | ' | ' | ' |
Withholding Tax Percentage Applicable To Foreign Investors As Non Resident Enterprises | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Withholding Tax Percentage Applicable To Foreign Investors To Direct Holding Company | ' | ' | ' | 5.00% | 5.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage Owned In Holding Company To Avail Withholding Tax Of Five Percent | ' | ' | ' | 25.00% | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred Foreign Income Tax Expense (Benefit) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $3.50 | ' | ' | ' |
Deferred State and Local Income Tax Expense (Benefit) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.17 | ' | ' | ' |
Undistributed Earnings, Basic | ' | ' | ' | 178.5 | ' | ' | 158.5 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Tax Provision On Retained Earning Not Reinvested | ' | ' | ' | 8.9 | ' | ' | 7.9 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Effective Income Tax Rate Reconciliation, State and Local Income Taxes | ' | ' | ' | 15.00% | 15.00% | ' | ' | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 15.00% | 12.50% | 12.50% | 12.50% | 25.00% | 25.00% | 25.00% | 12.50% | 12.50% | 16.50% | 25.00% | 15.00% | ' | 15.00% | 15.00% | 15.00% |
Effective Income Tax Rate Reconciliation, Foreign Income Tax Rate Differential | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' | ' | ' |
Additional Tax Payable Subject To Residential Status | ' | ' | ' | $0.12 | 0.24 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase In Income Tax Expense Benefit Percentage | ' | 14.90% | 15.30% | 17.90% | 17.90% | 17.80% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income_per_share_Details
Income per share (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Numerator: | ' | ' | ' | ' |
Net income attributable to the parent company’s common shareholders - Basic and Diluted | $6,733 | $8,624 | $24,514 | $19,544 |
Denominator: | ' | ' | ' | ' |
Weighted average shares outstanding (in shares) | 28,043,019 | 28,043,019 | 28,043,019 | 28,043,019 |
Dilutive effects of stock options (in shares) | 20,642 | 19,278 | 20,827 | 10,989 |
Denominator for dilutive income per share - Diluted (in shares) | 28,063,661 | 28,062,297 | 28,063,846 | 28,054,008 |
Net income per share attributable to parent company’s common shareholders - Basic (in dollars per share) | $0.24 | $0.31 | $0.87 | $0.70 |
Net income per share attributable to parent company’s common shareholders - Diluted (in dollars per share) | $0.24 | $0.31 | $0.87 | $0.70 |
Income_per_share_Details_Textu
Income per share (Details Textual) (Equity Option [Member]) | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Equity Option [Member] | ' | ' |
Earnings Per Share, Basic and Diluted [Line Items] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 60,000 | 60,000 |
Significant_concentrations_Det
Significant concentrations (Details Textual) | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Unusual Risk or Uncertainty [Line Items] | ' | ' |
Minimum Percentage Of Profit Allocated To Foreign Investment | 10.00% | ' |
Registered Capital Percentage | 50.00% | ' |
Ten Largest Customers [Member] | ' | ' |
Unusual Risk or Uncertainty [Line Items] | ' | ' |
Concentration Risk, Percentage | 68.00% | 73.20% |
Customer One [Member] | ' | ' |
Unusual Risk or Uncertainty [Line Items] | ' | ' |
Accounts Receivable Trade Percentage | 6.20% | 3.20% |
Concentration Risk, Percentage | 12.10% | 11.80% |
Customer Two [Member] | ' | ' |
Unusual Risk or Uncertainty [Line Items] | ' | ' |
Accounts Receivable Trade Percentage | 12.90% | ' |
Related_party_transactions_and2
Related party transactions and balances (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Other Related Parties [Member] | Other Related Parties [Member] | Other Related Parties [Member] | Other Related Parties [Member] | Technology Equipment [Member] | Technology Equipment [Member] | Technology Equipment [Member] | Technology Equipment [Member] | Equipment [Member] | Equipment [Member] | Equipment [Member] | Equipment [Member] | Materials [Member] | Materials [Member] | Materials [Member] | Materials [Member] | Advanced Equipment [Member] | Advanced Equipment [Member] | Mechandise [Member] | Mechandise [Member] | Mechandise [Member] | Mechandise [Member] | Accounts Receivable [Member] | Accounts Receivable [Member] | Other Receivables [Member] | Other Receivables [Member] | Accounts Payable [Member] | Accounts Payable [Member] | Other Advance Payments [Member] | Other Advance Payments [Member] | ||
Raw Materials [Member] | Raw Materials [Member] | Raw Materials [Member] | Raw Materials [Member] | Rental Income [Member] | Rental Income [Member] | Rental Income [Member] | Rental Income [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | Related Party [Member] | |||||||||||||||||||||
Related sales | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Assets Sold To Related Parties | ' | ' | $12,746 | $9,166 | $39,483 | $26,344 | $657 | $0 | $657 | $0 | $199 | $0 | $199 | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $11,890 | $9,166 | $38,627 | $26,344 | ' | ' | ' | ' | ' | ' | ' | ' |
Related purchases | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Related parties | ' | ' | 7,457 | 11,335 | 23,527 | 25,906 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 114 | 58 | 278 | 575 | 1,274 | 777 | 2,528 | 2,160 | 6,069 | 10,500 | 20,721 | 23,171 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Related Loans | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loans to related parties | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 19,922 | 0 | 20,608 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Related receivables | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accounts receivable | 22,253 | 17,194 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 22,253 | 17,194 | ' | ' | ' | ' | ' | ' |
Other receivables | 48 | 108 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 48 | 108 | ' | ' | ' | ' |
Total | 22,301 | 17,302 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Related advances | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Advance equipment payment to related parties | 2,391 | 2,097 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,391 | 2,097 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Advance payments and others to related parties | 1,715 | 866 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,715 | 866 |
Total | 4,106 | 2,963 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Related payables | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accounts payable | $3,837 | $4,634 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $3,837 | $4,634 | ' | ' |
Related_party_transactions_and3
Related party transactions and balances (Details Textual) | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2013 | Nov. 13, 2014 |
USD ($) | CNY | Hanlin Chen [Member] | |
Subsequent Event [Member] | |||
Related Party Transaction [Line Items] | ' | ' | ' |
Equity Method Investment, Ownership Percentage | ' | ' | 55.60% |
Due from Related Parties, Current | $20.60 | 126.6 | ' |
Loans and Leases Receivable, Related Parties | $14.10 | 87 | ' |
Related Party Transaction, Rate | 5.60% | 5.60% | ' |
Commitments_and_contingencies_1
Commitments and contingencies (Details) (USD $) | Sep. 30, 2014 | |
In Thousands, unless otherwise specified | ||
Commitments and Contingencies Disclosure [Line Items] | ' | |
2014 | $4,911 | [1] |
2015 | 6,769 | |
2016 | 3,347 | |
2017 | 2,438 | |
Thereafter | 0 | |
Total | 17,465 | |
Interest on short-term bank loan [Member] | ' | |
Commitments and Contingencies Disclosure [Line Items] | ' | |
2014 | 383 | [1] |
2015 | 606 | |
2016 | 0 | |
2017 | 0 | |
Thereafter | 0 | |
Total | 989 | |
Obligations for purchasing agreements [Member] | ' | |
Commitments and Contingencies Disclosure [Line Items] | ' | |
2014 | 3,715 | [1] |
2015 | 4,538 | |
2016 | 96 | |
2017 | 0 | |
Thereafter | 0 | |
Total | 8,349 | |
Obligations for investment contracts [Member] | ' | |
Commitments and Contingencies Disclosure [Line Items] | ' | |
2014 | 813 | [1],[2] |
2015 | 1,625 | [2] |
2016 | 3,251 | [2] |
2017 | 2,438 | [2] |
Thereafter | 0 | [2] |
Total | $8,127 | [2] |
[1] | Remaining 3 months in 2014. | |
[2] | Capital Commitment to the Venture Fund |
Recovered_Sheet1
Commitments and Contingencies (Details Textual) (Hubei Henglong [Member]) | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Oct. 20, 2014 | Oct. 20, 2014 |
USD ($) | CNY | Suzhou Qingyan Automobile Industry Venture Firm [Member] | Suzhou Qingyan Automobile Industry Venture Firm [Member] | Suzhou Qingyan Automobile Industry Venture Firm [Member] | Suzhou Qingyan Automobile Industry Venture Firm [Member] | |
USD ($) | CNY | Subsequent Event [Member] | Subsequent Event [Member] | |||
USD ($) | CNY | |||||
Commitments and Contingencies Disclosure [Line Items] | ' | ' | ' | ' | ' | ' |
Capital | $8,100,000 | 50,000,000 | $800,000 | 5,000,000 | $800,000 | 5,000,000 |
Noncontrolling Interest, Ownership Percentage by Parent | 17.90% | 17.90% | ' | ' | ' | ' |
Unpaid Capital | ' | ' | $7,300,000 | 45,000,000 | ' | ' |
Segment_reporting_Details
Segment reporting (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | |||
Net Product Sales | $101,735 | $90,919 | $331,517 | $285,971 | |||
Net Income (Loss) | 8,026 | 10,429 | 29,923 | 24,160 | |||
Henglong [Member] | ' | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | |||
Sales Revenue, Goods, Gross | 60,902 | 55,846 | ' | ' | |||
Net Product Sales | ' | ' | 203,987 | 177,836 | |||
Net Income (Loss) | 5,127 | 8,368 | 22,660 | 19,751 | |||
Jiulong [Member] | ' | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | |||
Sales Revenue, Goods, Gross | 15,964 | 16,692 | ' | ' | |||
Net Product Sales | ' | ' | 57,753 | 56,735 | |||
Net Income (Loss) | 168 | 279 | 1,750 | 1,516 | |||
Shenyang [Member] | ' | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | |||
Sales Revenue, Goods, Gross | 8,988 | 9,095 | ' | ' | |||
Net Product Sales | ' | ' | 32,928 | 28,164 | |||
Net Income (Loss) | 998 | 603 | 1,760 | 1,119 | |||
Wuhu [Member] | ' | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | |||
Sales Revenue, Goods, Gross | 5,941 | 4,948 | ' | ' | |||
Net Product Sales | ' | ' | 18,345 | 17,113 | |||
Net Income (Loss) | -88 | -145 | -167 | -312 | |||
Hubei Henglong [Member] | ' | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | |||
Sales Revenue, Goods, Gross | 14,425 | 11,783 | ' | ' | |||
Net Product Sales | ' | ' | 41,708 | 34,610 | |||
Net Income (Loss) | 1,110 | 6,092 | [1] | 44,512 | [2] | 7,550 | [2] |
Other Sector [Member] | ' | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | |||
Sales Revenue, Goods, Gross | 9,887 | 7,558 | ' | ' | |||
Net Product Sales | ' | ' | 30,210 | 24,866 | |||
Net Income (Loss) | 252 | 522 | 1,246 | 1,416 | |||
Total Segments [Member] | ' | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | |||
Sales Revenue, Goods, Gross | 116,107 | 105,922 | ' | ' | |||
Net Product Sales | ' | ' | 384,931 | 339,324 | |||
Net Income (Loss) | 7,567 | 15,719 | 71,761 | 31,040 | |||
Corporate [Member] | ' | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | |||
Sales Returns and Allowances, Goods | 0 | 0 | ' | ' | |||
Net Product Sales | ' | ' | 0 | 0 | |||
Net Income (Loss) | 231 | 309 | -1,792 | -2,203 | |||
Eliminations [Member] | ' | ' | ' | ' | |||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | |||
Sales Returns and Allowances, Goods | -14,372 | -15,003 | ' | ' | |||
Net Product Sales | ' | ' | -53,414 | -53,353 | |||
Net Income (Loss) | $228 | ($5,599) | ($40,046) | ($4,677) | |||
[1] | $5.2 million included in the balances of $6.1 million was income from investment in Henglong in 2013, which has been eliminated at the consolidation level. | ||||||
[2] | $40.3 million and $5.2 million included in the respective balances of $44.5 million and $7.6 million was income from investment in Henglong in 2014 and 2013, respectively, which has been eliminated at the consolidation level. |
Segment_reporting_Details_Text
Segment reporting (Details Textual) (USD $) | 3 Months Ended | 9 Months Ended | 9 Months Ended | ||||
Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | |
Sales Revenue, Net [Member] | Zhejiang Henglong and Vie Pump Manu Co Ltd [Member] | Jingzhou Henglong Automotive Parts Co Ltd [Member] | Jingzhou Henglong Automotive Parts Co Ltd [Member] | ||||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Investment Income, Net | $6,100,000 | ' | ' | ' | ' | $44,500,000 | $7,600,000 |
Concentration Risk, Percentage | ' | ' | ' | 10.00% | ' | ' | ' |
Business Acquisition, Percentage of Voting Interests Acquired | ' | ' | ' | ' | 51.00% | ' | ' |
Deferred Tax Assets, Net of Valuation Allowance, Noncurrent, Total | $5,200,000 | $4,760,000 | $4,528,000 | ' | ' | $40,300,000 | $5,200,000 |
Subsequent_events_Details_Text
Subsequent events (Details Textual) | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Oct. 13, 2014 | Oct. 20, 2014 | Oct. 20, 2014 |
Hubei Henglong [Member] | Hubei Henglong [Member] | Hubei Henglong [Member] | Hubei Henglong [Member] | Jiulong Machinery Electricity [Member] | Subsequent Event [Member] | Subsequent Event [Member] | |
USD ($) | CNY | Suzhou Qingyan Automobile Industry Venture Firm [Member] | Suzhou Qingyan Automobile Industry Venture Firm [Member] | Hubei Henglong [Member] | Hubei Henglong [Member] | ||
USD ($) | CNY | Suzhou Qingyan Automobile Industry Venture Firm [Member] | Suzhou Qingyan Automobile Industry Venture Firm [Member] | ||||
USD ($) | CNY | ||||||
Subsequent Event [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Capital | $8,100,000 | 50,000,000 | $800,000 | 5,000,000 | ' | $800,000 | 5,000,000 |
Business Combination Consideration Transferred Equity Interests Issued | ' | ' | ' | ' | 4,078,000 | ' | ' |