Business Performance - In the first half of 2022, Nexteer Automotive successfully launched 17 new customer projects, with 16 being new or newly acquired business, including 8 projects supporting electric vehicles (EVs) [22] - The total order value for customer projects reached $4.4 billion, with 83% being new business, including a significant win for a global OEM's first mass production steer-by-wire (SbW) project [22] - Revenue for the six months ended June 30, 2022, was $1,791,067 thousand, representing a 3.3% increase from $1,734,394 thousand in the same period of 2021 [40] - The company reported a net loss attributable to equity holders of $11,138 thousand, a decline of 113.4% compared to a profit of $83,143 thousand in the same period last year [40] - Total revenue for the six months ended June 30, 2022, was $1,791,067 thousand, an increase from $1,734,394 thousand in the same period of 2021, representing a growth of 3.3% [106] Financial Metrics - Gross profit decreased by 33.8% to $149,813 thousand compared to $226,472 thousand in the prior year [40] - Profit before tax dropped by 77.7% to $20,721 thousand from $93,027 thousand year-over-year [40] - Adjusted EBITDA for the period was $158,117 thousand, down 25.7% from $212,890 thousand in the prior year [40] - The comprehensive total loss for the period was $(53,883) thousand, compared to a gain of $78,318 thousand in the same period of 2021 [108] - The company reported a foreign exchange loss of $(45,126) thousand for the six months ended June 30, 2022, compared to $(9,014) thousand in the same period of 2021 [109] Challenges and Market Conditions - The company continues to face challenges from rising material costs and global supply chain disruptions, impacting production efficiency and operational performance [25] - The semiconductor chip supply shortage has significantly impacted the automotive industry, affecting production plans and operational efficiency [74] - The company anticipates potential adverse effects from the ongoing COVID-19 pandemic on future financial conditions and operational performance [120] - The company faced significant challenges from inflationary pressures, supply chain constraints, and semiconductor shortages impacting operational efficiency [54] Product Development and Innovation - Nexteer introduced a new eDrive product line, combining steering and drivetrain expertise as a cost-effective emissions reduction solution [22] - The company is focusing on advanced steering technologies to meet the demands of electric vehicles (EVs) and improve noise, vibration, and harshness (NVH) performance [31] - The company is expanding its software solutions for vehicle integration and advanced safety features, collaborating with manufacturers to enhance flexibility and value [33] - The global R&D team will continue to explore new paths to leverage major trends and provide innovative solutions for manufacturers' evolving product challenges [29] Operational Efficiency - The company continues to focus on technological leadership and adapting to major trends such as electrification and software integration to drive future growth [22] - The company is well-positioned to support manufacturers' future priorities in electrification, software, connectivity, and advanced driver-assistance systems (ADAS) [29] - The company expects the amortization of capitalized product development costs to continue rising in the coming years due to new customer projects [55] Corporate Governance and Compliance - The company has adopted its own internal control and corporate governance policies in accordance with the Hong Kong Stock Exchange's Corporate Governance Code [79] - The company failed to comply with the listing rules regarding the composition of the Audit and Compliance Committee, which had only two members instead of the required three [81] - The company has confirmed that all directors have complied with the standards set out in the Securities Trading Code for the six months ending June 30, 2022 [82] - The company has implemented a risk management and internal control system, which is regularly reviewed for effectiveness [83] Employee and Management Changes - The company has approximately 12,100 full-time employees as of June 30, 2022, with a focus on performance-based compensation policies [76] - The chairman and CEO roles have been combined under Mr. Lei Zili since June 21, 2022, which deviates from the listing rules but is believed to provide consistent leadership [80] - The company has seen changes in its executive team, with several resignations effective June 14 and June 21, 2022 [84] Cash Flow and Investments - Operating cash flow for the six months ended June 30, 2022, was $122.5 million, an increase of $27.8 million compared to $94.7 million for the same period in 2021 [45] - The net cash used in investing activities for the six months ended June 30, 2022, was $129.3 million, a decrease from $138.6 million in the same period of 2021 [67] - The company reported a net increase in cash and cash equivalents of $7.8 million for the six months ended June 30, 2022, compared to a decrease of $219.3 million in the same period of 2021 [64] Shareholder Information - The board of directors does not recommend the distribution of any interim dividend for the six months ended June 30, 2022 [85] - The company declared a dividend of approximately $23,843,000 on June 21, 2022, for the year ended December 31, 2021, while no interim dividend was recommended for the six months ended June 30, 2022 [198] - The total number of stock options granted but not exercised as of June 30, 2022, was 12,936,960 [88]

Business Performance - In 2021, Nexteer Automotive Group achieved strong customer orders, including winning business from a Japanese automaker and several Chinese new energy vehicle startups[33]. - The company's revenue for the fiscal year ended December 31, 2021, was $3,358.7 million, representing a 10.8% increase compared to 2020[39]. - The operating profit was $115.2 million, and the net profit attributable to equity holders was $118.4 million, reflecting a 1.4% increase from 2020[39]. - The total customer orders amounted to $5.9 billion, with 28% of these orders won from competitors, including significant contracts with a Japanese OEM and several Chinese EV startups[37]. - The signed business order backlog reached a record $26.8 billion, with 25% supporting electric vehicle projects[37]. - The company continues to focus on expanding its customer base and capturing new business opportunities in the electric vehicle sector[37]. - The company remains optimistic about future growth, driven by strong consumer demand and ongoing industry recovery despite supply chain challenges[37]. - The company anticipates significant growth opportunities in the mobility sector, driven by unprecedented innovation and transformation in the industry[40]. - The company achieved a record signed business order volume of $26.8 billion from order to delivery[61]. - The company’s revenue for the year ended December 31, 2021, increased by 10.8% compared to 2020, reaching $1,734.4 million, driven by a recovery in automotive production[114]. Product Development and Innovation - The company expanded its product portfolio to include eDrive and software solutions for road monitoring and vehicle health management in early 2022[33]. - Nexteer emphasizes innovation in steering and powertrain systems, aiming to lead in value-added services within the market[24]. - The company has established four technology and software centers to enhance its research and development capabilities[26]. - The company introduced a new eDrive product line, including a 48-volt integrated belt-driven starter/generator solution for hybridizing traditional internal combustion engine vehicles[38]. - The company received multiple awards for innovation, including the 2021 Automotive News PACEpilot Innovation Award and the 2022 CES Innovation Award[35]. - The company is focused on expanding its product offerings in electric vehicle applications, with three electric vehicle models already reserved for its HO REPS system[43]. - The company’s new products include advanced steering solutions that cater to the growing demand for electric and shared autonomous vehicles[56]. - The company is actively developing modular SbW technology, which is tailored to meet the specific requirements of multiple OEMs, reinforcing its leadership in this technology area[78]. - The company is collaborating with a major OEM to launch its first retractable steering column application by early 2025[49]. - The company announced advanced road surface detection and tire health monitoring software in collaboration with Tactile Mobility, aimed at improving vehicle condition management and safety[89]. Financial Overview - The total order amount in the Asia-Pacific region reached $1.3 billion in 2021, with several key customer projects acquired in the EPS and powertrain systems[106]. - The company’s total liabilities decreased, with current liabilities down by 14.9% to $942,127 thousand[111]. - The company’s cash balance decreased to $226.9 million at year-end, down from $553.4 million at the end of 2020, largely due to increased net borrowings[115]. - The company reported a total provision of $55.8 million related to estimated warranty and product liability obligations as of December 31, 2021[190]. - The company’s capitalized engineering and product development costs amounted to $707.8 million, with property, plant, and equipment valued at $988.9 million as of December 31, 2021[188]. - The company’s reliance on information technology systems poses risks related to potential disruptions from natural disasters or cyberattacks[191]. - The company proposed a final dividend of approximately $23.8 million for the year ended December 31, 2021, representing about 20% of the net profit attributable to equity holders[196]. - The company has identified operational risks due to internal processes, personnel, and external events, which cannot be completely eliminated[177]. Market Position and Strategy - Nexteer aims to diversify its revenue base and strengthen its technological leadership through strategic acquisitions and alliances, particularly targeting growth in China and emerging markets[2]. - The company operates 26 manufacturing plants and has over 60 global customers, including major automakers like BMW, Ford, and Toyota[26]. - The company has a leading position in the North American market for its Rack Electric Power Steering (REPS) systems, serving major clients such as Ford, Stellantis, and General Motors[43]. - The company is focused on expanding its market presence through strategic partnerships and collaborations within the automotive sector[153]. - The company is committed to aligning its product lines with major trends such as ADAS, electrification, and mobility as a service, which are expected to provide competitive advantages and future opportunities[146]. - The company is actively pursuing growth opportunities in new product lines and advanced engineering, with a focus on aligning technology development with industry trends[153]. Operational Challenges - The company experienced a significant impact from semiconductor shortages and rising logistics costs, affecting profitability across its North American and European operations[114]. - The ongoing semiconductor and raw material supply shortages are expected to have a temporary impact on the company's operations[183]. - The company faced adverse impacts from rising costs of certain goods and logistics, which affected operational performance during the year[145]. - The automotive industry is cyclical and sensitive to overall economic conditions, affecting sales and production levels[179]. - The company has experienced operational challenges that may affect its revenue and profitability due to the cyclical nature of the automotive market[181]. Governance and Leadership - The company has a robust management team with extensive experience in the automotive industry, ensuring effective execution of its strategic goals[154]. - The leadership team collectively brings over 150 years of automotive industry experience, enhancing the company's competitive edge[165][166][167][168][169]. - The board of directors is responsible for the overall management and operation of the business, with several changes in board membership noted as of the report date[150]. - The company emphasizes the importance of training programs for both full-time and contract employees to meet corporate goals and customer requirements[148]. - The leadership team emphasizes the importance of maintaining relationships with key external stakeholders to support business development and strategic initiatives[152]. Environmental, Social, and Governance (ESG) - Nextracker emphasizes its commitment to ESG and sustainable practices, having been recognized as one of America's most responsible companies for three consecutive years[96]. - The company has adopted ESG reporting guidelines as per listing rules and is committed to conducting business in an environmentally sustainable manner[199]. - Stakeholder expectations regarding environmental, social, and governance (ESG) issues are evolving, necessitating continuous monitoring of changing standards and reporting requirements[192]. - The company made charitable contributions totaling $0.2 million in 2021, with employees volunteering over 15,000 hours for local charitable work[200].

Business Performance - The company successfully launched 16 new customer projects in the first half of 2021, marking a strong performance for three consecutive years, with 14 of these being new business acquisitions[7]. - Total customer project orders amounted to $1.3 billion, with 89% of these projects won from competitors, including a breakthrough with a Japanese OEM for REPS products[7]. - The signed business order volume from order to delivery reached $24.5 billion, indicating strong demand and a solid backlog[7]. - In the first half of 2021, the company achieved a total order volume of $24.5 billion, slightly down from $24.6 billion at the end of 2020[11]. - The company maintained a 100% retention rate of existing business over the past three years, with approximately 50% of new orders coming from newly acquired business[10]. - Revenue for the first half of 2021 reached $1,734,394 thousand, a 43.3% increase compared to $1,210,720 thousand in the same period of 2020[33]. - Gross profit for the first half of 2021 was $226,472 thousand, representing an 85.6% increase from the previous year's $122,029 thousand[33]. - Adjusted EBITDA for the first half of 2021 was $212,890 thousand, up 84.1% from $115,666 thousand in the first half of 2020[33]. - The company reported a pre-tax profit of $93,027 thousand, a significant increase of 399.2% compared to a loss of $31,089 thousand in the same period of 2020[33]. - Profit attributable to equity holders of the company was $83,143 thousand, a dramatic increase of 6,290.7% from $1,301 thousand in the first half of 2020[33]. Market Strategy and Innovation - The company continues to focus on technological leadership and adapting to major trends, including software and electrification[7]. - The company is selectively seeking acquisitions and alliances to enhance its growth strategy, particularly targeting growth in China and emerging markets[2]. - The company is focusing on expanding its product portfolio to cover B to D segment vehicles, as well as light commercial vehicles (LCV) and heavy trucks (3.5 to 6 tons)[14]. - The company is well-positioned to support the electrification trend, particularly in the electric pickup truck segment, with products like HO REPS and ball-spline half shafts set to be used in the upcoming GMC Hummer EV[20]. - The company is preparing for the increasing interest in steer-by-wire (SbW) technology, positioning itself as a leading supplier in performance, safety, and value[15]. - The company is actively collaborating with two major global vehicle manufacturers on future SbW projects, leveraging its modular SbW technology[16]. - The company is responding to the growing demand for software-supported steering functions and other software-centric motion control applications[21]. - The company is developing a centralized software team to support EPS systems and advanced steering functions[23]. - The company announced a new strategic software team to enhance its global software engineering capabilities, consolidating expertise across four locations[22]. Financial Health and Challenges - The ongoing supply chain challenges have led to increased input costs and logistics time, impacting financial performance in the first half of 2021[29]. - Despite challenges from global semiconductor shortages, Nextrer actively collaborates with OEM customers and suppliers to mitigate impacts on vehicle production requirements[29]. - The group faced challenges from raw material inflation, transportation and logistics costs, and semiconductor chip shortages, which impacted operational efficiency despite the recovery in light vehicle production[46]. - The company reported a total comprehensive income of $78,318 thousand for the six months ended June 30, 2021, compared to a loss of $12,257 thousand in the same period of 2020[100]. - The company incurred a net cash outflow from financing activities of $(175,364) thousand, compared to $(28,438) thousand in the previous year, primarily due to higher loan repayments[111]. - The company faced rising costs in certain commodities and logistics, which adversely affected its operating performance in the first half of 2021[114]. Employee and Corporate Governance - The company is committed to becoming the employer of choice, focusing on employee engagement and satisfaction[7]. - The new collective bargaining agreement with UAW will be effective until March 2026, establishing a strong and sustainable future for employees and the company[28]. - Nextrer has received multiple awards for its human resources management and workplace environment, including recognition as an ideal workplace in Mexico and Poland[31]. - The company is committed to enhancing employee health and safety while advancing its environmental, social, and governance (ESG) initiatives[29]. - The company is integrating sustainability into its global business strategy, achieving various recognitions such as being named one of America's Most Responsible Companies for two consecutive years[29]. - The company is committed to high standards of corporate governance, ensuring transparency and protection of shareholder rights[70]. Shareholder Value and Stock Options - The company aims to enhance shareholder value through a six-point profit growth strategy, which has guided decision-making during the challenges posed by the COVID-19 pandemic[6]. - The board did not recommend any interim dividend for the six months ended June 30, 2021[74]. - The company granted stock options totaling 16,416,350 shares, with an exercise price ranging from ¥5.150 to ¥12.456 depending on the grant date[79]. - The total number of shares held by directors and key executives through stock options was 5,621,880 shares, representing approximately 0.22% of the total issued shares[81]. - The company has a stock option vesting schedule requiring one year of holding from the grant date, with one-third of the options vesting annually[79]. Assets and Liabilities - As of June 30, 2021, the total assets of the company amounted to $3,161,891 thousand, a decrease from $3,305,741 thousand as of December 31, 2020, representing a decline of approximately 4.3%[93]. - The total liabilities as of June 30, 2021, were $1,184,808 thousand, an increase from $1,384,756 thousand as of December 31, 2020, reflecting a decrease of about 14.4%[96]. - The company's intangible assets rose to $686,031 thousand, up from $657,493 thousand, marking an increase of approximately 4.3%[93]. - The company’s deferred tax assets decreased to $6,416 thousand from $11,805 thousand, a decline of approximately 45.6%[93]. - The total borrowings of the group as of June 30, 2021, were $114.3 million, a decrease of $134.3 million from $248.6 million as of December 31, 2020[62].

Financial Performance - Nexteer Automotive reported a revenue of $1.5 billion for the fiscal year 2020, with a 10% increase compared to the previous year[25]. - In 2020, the company's revenue was $3,032.2 million, with an operating profit of $118.7 million and a net profit attributable to equity holders of $116.8 million[34]. - The company reported a 1% increase in revenue for the full year 2020 compared to 2019, despite the challenges posed by the COVID-19 pandemic[52]. - Total revenue for 2020 was $3,032,210, a decrease of 15.2% from $3,575,657 in 2019[100]. - Gross profit for 2020 was $411,376, down from $538,702 in 2019, reflecting a decline of 23.6%[100]. - Adjusted EBITDA for 2020 was $378,012, a decrease of 28.0% from $525,096 in 2019[100]. - The company reported a net profit attributable to equity holders of $116,766, down 49.8% from $232,445 in 2019[100]. - The company experienced a significant tax benefit in 2020 due to the U.S. CARES Act, which allowed for the carryback of losses to prior tax years[104]. - The company’s profit attributable to equity holders was $116.8 million, down 49.8% from $232.4 million in the previous year, primarily due to reduced production volumes[115]. Customer Projects and Market Position - The company secured $3.7 billion in customer projects in 2020, with 39% being new projects, maintaining a 100% retention rate of existing customer projects over the past three years[34]. - The company successfully launched 47 new customer projects globally across all product lines and regions in 2020[33]. - The company plans to expand its market position by growing with more global vehicle manufacturers over the next few years[34]. - The company aims to enhance its product portfolio by expanding its core products into adjacent markets, including advanced steering and powertrain solutions[34]. - The company has maintained a disciplined approach to cost management and capital investment to ensure business continuity during challenging times[33]. Technological Innovation and Product Development - Nexteer is positioned as a leader in advanced steering and powertrain systems, as well as advanced driver-assistance systems (ADAS) and autonomous driving technologies[25]. - The company emphasizes innovation and value-added services in the steering and powertrain systems market[25]. - The company continues to leverage its strong technical capabilities to develop innovative products and value-added solutions for customers[34]. - The company is committed to investing in technology to support future growth and align with major industry trends such as electrification and software[33]. - The company plans to launch the first market application of a retractable steering column technology in 2023 with a major automotive manufacturer[43]. - The company’s technology aligns well with the evolving trends in the automotive sector, providing competitive advantages and potential future opportunities[140]. Operational Efficiency and Cost Management - The company has maintained strict cost control and cash flow management as a priority throughout 2020, adapting to macroeconomic factors impacting the industry[55]. - The company implemented innovative virtual engineering applications to manage workflows previously reliant on manual processes, enhancing operational efficiency[56]. - The company is implementing new strategies to improve operational efficiency, expecting a reduction in costs by 8% over the next year[151]. - The company has a strong emphasis on quality and project implementation, led by Ricardo Antonio Pastor as Global Vice President of Quality and Project Launch[156]. Market Trends and Strategic Focus - The company is strategically aligning its product lines with global trends such as electrification, software, connectivity, and advanced driver-assistance systems (ADAS) to support automotive manufacturers[69]. - The North American full-size truck market has shown stable consumer demand during the pandemic, providing unique growth opportunities for the company, especially in the EPS segment[71]. - The automotive software sector is experiencing unprecedented growth opportunities, prompting the company to enhance its support for steering systems and cloud software algorithms[78]. - The company is focused on expanding its market presence and enhancing operational efficiency across its divisions[157]. Corporate Governance and Management - The company has seen significant changes in its board of directors, with several appointments and resignations in 2020[143][144][145]. - Zhao Guibin has been appointed as the CEO since June 2012 and has over 20 years of experience in the automotive industry[147]. - The company has established a Global Strategy Committee (GSC) to oversee strategic vision and execution[147]. - The management team includes key executives with extensive experience in strategic planning and global engineering integration[146]. Sustainability and Corporate Responsibility - The company is committed to conducting business in an environmentally friendly manner and has adopted ESG reporting guidelines as per the Hong Kong Stock Exchange[193]. - The company is focusing on sustainability initiatives, committing to reduce carbon emissions by 25% by 2025 as part of its corporate responsibility strategy[153]. - The company made charitable donations totaling $0.3 million in 2020, with employees contributing over 7,000 hours to volunteer work[194]. Risks and Challenges - The company acknowledges various risks and uncertainties that may impact its financial condition and operational performance, emphasizing the need for risk management strategies[170]. - The company is experiencing global shortages of semiconductor components and raw materials, which have affected production and may impact future operations and cash flow[177]. - The automotive industry is highly competitive, with competitors seeking to expand market share, which may exert downward pressure on pricing and profitability[179]. - The company faces potential financial risks due to environmental regulations and climate change, which may impact operational costs and product demand[185].

Automotive Production and Market Trends - In the first half of 2020, global automotive production decreased by 33% to 30.1 million vehicles compared to the same period in 2019, due to widespread actions taken to curb the spread of COVID-19[17]. - The company anticipates a recovery in automotive production in the second half of 2020, with IHS projecting a 22% decrease in production compared to 2019[17]. - Global automotive production is expected to increase to 39.4 million units in the second half of 2020, representing a 31% growth compared to the first half, but a 10% decline compared to 2019[18]. - The North American full-size truck market saw a sales decline of 6.8% from January to May 2020, while the overall U.S. sales dropped by 22.8% during the same period[36]. - The demand for North American full-size truck production is driven by high incentive levels and a strong demand from first-time buyers affected by the economic situation[36]. Company Performance and Financials - The company's revenue for the six months ended June 30, 2020, was $1,210.7 million, a decrease of 33.9% compared to $1,832.3 million for the same period in 2019[55]. - Gross profit for the first half of 2020 was $122.0 million, down 57.2% from $285.4 million in the first half of 2019[55]. - The company recorded a loss before tax of $31.1 million, a significant decline of 120.1% compared to a profit of $155.0 million in the same period last year[55]. - The adjusted EBITDA for the first half of 2020 was $115.7 million, representing a decrease of 58.2% from $276.9 million in the first half of 2019[55]. - The company's cash flow was negatively impacted, resulting in net usage due to reduced profitability and unfavorable working capital[51]. COVID-19 Impact and Response - The company has implemented cost control and capital investment measures to mitigate financial impacts from the pandemic[16]. - The company has shifted its focus to cash flow management as a priority in response to the COVID-19 pandemic, implementing strict cost control measures and capital investment management[19]. - The company has developed a "Safety Work Manual" to enhance employee health and safety protocols in response to COVID-19[22]. - During the COVID-19 pandemic, the company produced over 30,000 masks and 6,000 ear protectors in Saginaw, USA, and over 5,000 face shields in Tychy, Poland[26]. - The impact of COVID-19 significantly affected operations, leading to temporary shutdowns and operational disruptions during the first half of 2020[81]. Technological Advancements and Product Development - The company focuses on enhancing its technological leadership and adapting to trends, particularly in electrification[16]. - The company is well-positioned to support automakers in addressing key concerns related to electrification, advanced safety, and performance trends[30]. - The company has secured orders for high-power EPS systems for three electric vehicles, including a full-size electric light-duty truck[33]. - The company's HO REPS technology is capable of achieving a steering load of 24 kN, overcoming previous limitations of 12-volt systems[34]. - The company is aligning its product portfolio with major trends such as ADAS, electrification, and connectivity[30]. Organizational Changes and Leadership - Recent organizational changes include the appointment of new executives to strengthen leadership and operational capabilities[47]. - The board of directors has undergone changes, with Michael Paul Richardson resigning as president and Robin Zane Milavec appointed as executive director effective June 30, 2020[87]. - The annual salary for the executive director and CEO, Zhao Guibin, is $1,040,000, consistent with market median[87]. Stock Options and Shareholder Information - The company has a stock option plan adopted on June 5, 2014, allowing the board to grant options to directors and key personnel[89]. - The total number of stock options granted but not exercised was 70,765,490, with 37,744,850 options exercised during the period[90]. - The total number of stock options held by directors and key executives reflects a commitment to performance-based compensation[93]. - The company reported a total of 25,019,600 stock options granted to directors and key executives, representing approximately 0.31% of the total issued shares[93]. - The company has a significant shareholder, Nissin Automotive Systems (Hong Kong) Holdings Limited, holding 1,680,000,000 shares, representing 67.00% of the total issued shares[98]. Risk Management and Compliance - The company has implemented a risk management and internal control system, which is regularly reviewed for effectiveness[86]. - The company continues to monitor foreign exchange risks and seeks to mitigate these through matched currency purchases[79]. - The company faces various financial risks including market risk, credit risk, and liquidity risk, with a focus on minimizing potential adverse impacts on financial performance[127]. Revenue Recognition and Customer Contracts - Revenue from customer contracts is recognized upon delivery of production parts, with payments typically received shortly after sales[134]. - The average payment term for customers is between 47 to 60 days, indicating a relatively quick cash conversion cycle[131]. - The company has confirmed revenue amounts based on procurement order prices, ensuring a clear revenue recognition process[131].

Company Overview - Nexteer Automotive reported a focus on advanced steering and powertrain systems, emphasizing their competitive advantage in hardware, software, and electronics integration[3]. - The company has over 110 years of expertise in vehicle integration and product craftsmanship, which supports their commitment to delivering reliable and safety-focused products[3]. - Nexteer Automotive serves major global automotive manufacturers, including BMW, Ford, and Toyota, highlighting their extensive customer base[4]. - The company operates manufacturing plants and technical centers globally, ensuring a robust operational footprint[5]. - Nexteer Automotive's headquarters is located in Auburn Hills, Michigan, USA, which serves as a central hub for their operations[8]. Product Offerings - The company is dedicated to innovation in the steering and powertrain systems market, aiming to provide value-added services and solutions[3]. - Nexteer Automotive's product lines include Electric Power Steering (EPS) systems and Hydraulic Power Steering (HPS) systems, showcasing their diverse offerings[13]. - The company has developed cost-competitive brushed motor column-assisted EPS (BEPS) tailored for emerging markets, with customers including SAIC-GM-Wuling and Changan[14]. - The hydraulic power steering (HPS) system is utilized by major manufacturers including FCA and General Motors, with exclusive use in GMC Sierra and Chevrolet Silverado[15]. - The company’s advanced steering column and intermediate shaft (CIS) products are used in various models from General Motors, Ford, FCA, and Toyota, enhancing safety and ergonomics[16]. - The company’s steer-by-wire (SbW) technology supports advanced safety features and flexible vehicle layouts, becoming a preferred choice for automated driving solutions[18]. Financial Performance - In 2019, the company reported a revenue of $3,575,657 thousand, a decrease of 8.6% compared to $3,912,170 thousand in 2018[70]. - The gross profit for 2019 was $538,702 thousand, down 19.5% from $668,847 thousand in the previous year[70]. - The adjusted EBITDA for 2019 was $525,096 thousand, reflecting a decline of 15.2% from $619,564 thousand in 2018[71]. - The company secured customer projects worth $7 billion in 2019, with 50% attributed to new business expansion[24]. - The total signed business order volume reached a historical high of $26.4 billion, representing a 4.4% increase compared to 2018[24]. Market Trends and Innovations - The software is projected to account for 40% of vehicle value by 2030, up from 10% in 2015[20]. - The anticipated growth in electric vehicles (EVs) is expected to drive demand for the company's EPS systems, which are compatible with both traditional internal combustion engine (ICE) and electric vehicle platforms[43]. - The company is positioned to lead the electrification trend, with its high-power EPS systems set to transform heavy-duty trucks from hydraulic to electric steering[44]. - The integration of advanced safety features, such as the Autonomous Emergency Steering (AES), is designed to reduce collision risks and enhance driver confidence[41]. - The company is focusing on advanced safety and performance technologies, particularly through its Software-based Steering (SbW) solutions, which enhance stability control and reduce braking distances[39]. Global Expansion and Operations - The company opened a new technology center in Suzhou, China, in January 2020, covering over 30,000 square meters, aimed at enhancing engineering capabilities and customer responsiveness[34]. - The new Chennai plant in India began production in May 2019, expanding regional capacity for CEPS systems and DL components[35]. - The company established its first African factory in Morocco, which began production in the third quarter of 2019, supporting various customer projects in Europe and Africa[36]. - The company relocated its Liuzhou plant in China to a new facility in June 2019, enhancing productivity to meet the demand for EPS systems in the Asia-Pacific market[36]. - The company launched 34 new projects in 2019, involving EPS, DL, and steering columns, with a notable number of DL projects nearing EPS project numbers[34]. Customer Relationships and Retention - The company emphasizes a customer-centric approach, focusing on understanding and meeting customer needs and expectations[3]. - The company has a strong commitment to building lasting relationships with customers and suppliers, positioning itself as a preferred partner in the automotive industry[3]. - The company achieved a 100% retention rate of existing business for the second consecutive year[24]. - The North America division secured 13 new projects in 2019, indicating growth in existing customer orders and new project acquisitions[66]. Challenges and Risks - The company faced challenges in 2019 due to a slowdown in automotive production demand and various adverse financial factors, impacting overall performance[78]. - Currency fluctuations negatively impacted the company's financial performance, with an estimated revenue loss of approximately $55.9 million due to stronger USD against CNY and EUR[85]. - The company's net profit attributable to equity holders dropped by 38.8% in 2019, influenced by a non-recurring tax benefit of $27.1 million in 2018[82]. - The global light vehicle production decreased by 5.8% in 2019 compared to 2018, impacting the company's revenue[83]. Corporate Governance and Leadership - The board of directors is responsible for managing and operating the business, with key executives overseeing strategic vision and execution[119]. - Zhao Guibin serves as the CEO and Vice Chairman, having over 20 years of experience in the automotive industry, and is responsible for leading the global strategic committee[121]. - The company has experienced significant leadership continuity, with key executives having long tenures in their respective roles[130]. - The management team includes executives with diverse backgrounds in finance, operations, and technology, enhancing the company's strategic capabilities[129]. Sustainability and Corporate Social Responsibility - The company emphasized its commitment to corporate social responsibility, integrating sustainability into its global business strategy[68]. - The company made charitable contributions totaling $0.5 million in 2019, with employees volunteering over 15,500 hours for local charitable work[166]. - The company is committed to environmental, social, and governance (ESG) practices, adhering to relevant laws and regulations[165]. Stock Options and Shareholder Information - The stock option plan allows for a maximum of 249,780,400 shares to be issued upon exercise, representing approximately 9.96% of the company's issued share capital as of the report date[178]. - The company proposed a final dividend of approximately $81.5 million, representing slightly over 35% of net profit, or $0.0325 per share, subject to shareholder approval[162]. - As of December 31, 2019, the company's distributable reserves were approximately $532.6 million, down from $576.5 million as of December 31, 2018[163].

Business Growth and Expansion - The signed business order volume increased to $25.6 billion, a 1.6% growth from $25.2 billion as of December 31, 2018[10] - Successfully launched 21 new customer projects across multiple product lines, regions, and customers[10] - Continued to expand global business presence in strategic regions including India, Morocco, and China[10] - The value of signed business orders increased by 1.6% to approximately $25.6 billion as of June 30, 2019, compared to $25.2 billion on December 31, 2018[11] - The company plans to launch over 50 customer projects in 2019, with approximately two-thirds of these projects located in the Asia-Pacific region[16] - The company has diversified its customer base by adding five new EPS customers over the past two years, enhancing its order book[16] - The company continues to focus on revenue growth and market share expansion by replacing competitors and winning new business[15] - The company celebrated the production of its 60 millionth EPS system in February 2019, achieved just 14 months after the 50 millionth milestone, indicating ongoing global expansion into new customers and markets[19] Technological Advancements - Strengthened technological leadership and software expertise to drive business growth in automotive and new mobility applications[10] - The company’s advanced steering technologies support SAE-defined levels 1 to 5 of ADAS performance, with steer-by-wire (SbW) unlocking new advantages for manufacturers[20] - The company continues to collaborate with major clients like FCA and Waymo to commercialize higher levels of vehicle automation, with plans to launch additional projects in 2020[21] - The new CEPS Gen 3.5 system integrates more technology and higher performance into a smaller space, aimed at enhancing reliability and software capabilities for global OEMs[19] - The company is well-positioned to benefit from the growing trend of electrification and various EVs, leveraging its industry-leading REPS and SPEPS systems[21] Operational Efficiency and Corporate Responsibility - Focused on operational efficiency and corporate social responsibility initiatives[10] - The company emphasizes the importance of resource allocation, prioritization, and efficiency improvements to meet customer expectations for quality and timing[16] - NEXTEER is committed to enhancing operational efficiency through standardized design, material, and manufacturing processes across all production sites[26] Financial Performance - Revenue for the first half of 2019 was $1,832,273, a decrease of 10.5% compared to $2,046,982 in the same period of 2018[32] - Gross profit for the first half of 2019 was $288,895, down 21.8% from $369,579 in the previous year[32] - Net profit attributable to equity holders for the first half of 2019 was $131,124, a decline of 34.3% from $199,605 in the same period of 2018[32] - Adjusted EBITDA for the first half of 2019 was $276,914, a decrease of 16.3% compared to $331,004 in the previous year[32] - The company's revenue for the six months ended June 30, 2019, was $1,832.3 million, a decrease of $214.7 million or 10.5% compared to $2,047.0 million for the same period in 2018[39] - The net profit attributable to equity holders for the six months ended June 30, 2019, was $131.1 million, representing 7.2% of total revenue, down from $199.6 million (9.8%) in the prior year[44] Regional Performance - Revenue by region showed a decline across all segments, with North America contributing $1,274.4 million (69.5%), Asia-Pacific $305.4 million (16.7%), and Europe, Middle East, Africa, and South America $252.5 million (13.8%) for the six months ended June 30, 2019[40] - The North America segment's revenue decreased by $68.5 million or 5.1%, primarily due to a 2.5% decline in light vehicle production among manufacturers[41] - The Asia-Pacific segment experienced a revenue drop of $112.9 million or 27.0%, attributed to unfavorable foreign exchange and a 13.5% decline in production demand from Chinese manufacturers[41] - The Europe, Middle East, Africa, and South America segment saw a revenue decline of $33.4 million or 11.7%, influenced by a 5.3% decrease in production among manufacturers in these regions[41] Corporate Governance and Management - The company has adopted internal controls and corporate governance policies to ensure effective and transparent operations[68] - The board appointed Mr. Wang Jian as the chairman effective from June 3, 2019, replacing Mr. Zhao Guibin, who will serve as vice chairman[72] - The company has adopted a risk management and internal control system, which is regularly reviewed for effectiveness[71] - The board believes that the separation of the roles of chairman and CEO will not harm the balance of power and authority within the company[69] Environmental and Social Responsibility - The company achieved its highest EcoVadis rating (Silver) and received Environmental Stewardship Recognition for its sustainability efforts[28] - The company has a stock option plan in place, with options granted for 12,972,770 shares at an exercise price of HKD 12.456 per share, representing approximately 0.518% of the issued share capital[184] - The total provision for environmental liabilities as of June 30, 2019, was $68,280,000, reflecting ongoing commitments related to environmental responsibilities[173] Investment and Capital Expenditures - Capital expenditures and intangible asset investments totaled $114.7 million and $78.5 million, respectively, reflecting significant investment in capital equipment and product development[55] - The company had capital commitments of $160,327,000 for the acquisition of property, plant, and equipment as of June 30, 2019, compared to $154,590,000 as of December 31, 2018[196] Joint Ventures and Partnerships - The joint venture CNXMotion, co-owned with Continental Automotive, is developing reliable control functions and showcased new features at a recent exhibition in Sweden[23] - The partnerships with Changan and Dongfeng provide unique market channels, capturing approximately 20% of domestic automotive sales in China[23] - The group's investment in joint ventures amounted to $17,075,000 as of June 30, 2019, compared to $17,944,000 as of December 31, 2018[199]

Company Overview - NEXTEER AUTOMOTIVE GROUP LIMITED has produced over 60 million Electric Power Steering (EPS) systems since 1999, contributing to significant fuel savings equivalent to filling 48 billion 16-ounce water bottles[41]. - The company focuses on advanced steering and powertrain systems, as well as Advanced Driver Assistance Systems (ADAS) and autonomous driving technologies, positioning itself as a comprehensive service provider[41]. - NEXTEER aims to enhance fuel efficiency and reduce emissions through its EPS technology, which is a key competitive advantage for automotive manufacturers[41]. - The company has established strong relationships with over 60 global customers, including major automotive manufacturers such as BMW, FCA, Ford, and General Motors[43]. - NEXTEER is committed to innovation in the steering and powertrain market, emphasizing customer-centric solutions and responsiveness to market needs[41]. - The company operates a global headquarters in Auburn Hills, Michigan, and has a significant presence in various international markets, including India, China, and South America[45]. - NEXTEER is listed on the Hong Kong Stock Exchange under the stock code 1316, with a preference note of $250 million at 5.875% maturing in 2021[49]. Product Development and Innovation - The company’s strategic focus includes the development of new products and technologies to meet evolving automotive industry demands[41]. - The company’s product lines include hydraulic power steering (HPS) and various components essential for vehicle control and power transmission systems[51]. - The company reported a strong performance in electric power steering (EPS) systems, with significant adoption by major manufacturers such as SAIC-GM-Wuling and Ford, enhancing driving experience and safety features[52]. - Hydraulic power steering (HPS) systems are utilized by major clients including FCA and General Motors, with products designed to improve operational efficiency and reduce energy consumption[53]. - The company’s advanced steering columns provide safety features and ergonomic adjustments, with clients including General Motors and Toyota, enhancing vehicle safety ratings[54]. - The company has developed high-availability EPS designs that incorporate redundancy in hardware and software, improving safety and adaptability for various automation levels[57]. - The steer-by-wire technology supports both traditional and autonomous driving, offering new possibilities for advanced safety features and vehicle layout flexibility[57]. - The Silent Steering™ system allows the steering wheel to remain stationary during autonomous driving, enhancing driver comfort and safety[57]. - The company introduced a collapsible steering column that increases space and comfort for drivers during autonomous operation[58]. - The SoD system enables safe and flexible switching between traditional and autonomous driving steering controls, supporting SAE Level 3 and above[58]. - The integration of advanced driver-assistance systems (ADAS) with EPS technology positions the company as a leader in automotive innovation[57]. Financial Performance - The signed business order volume increased to $25.2 billion, a year-over-year growth of 5.4% compared to $23.9 billion in 2017[72]. - The company successfully launched 22 new customer projects across multiple product lines and regions in 2018[66]. - New business accounted for 47% of the total order volume in 2018, highlighting the importance of acquiring new business for market share[77]. - The company celebrated a revenue of $3,912,170 thousand in 2018, representing a year-over-year growth of 0.9%[100]. - The company reported a net profit attributable to equity holders of $379,657 thousand in 2018, reflecting a 7.9% increase from the previous year[100]. - The company’s gross profit for 2018 was $675.4 million, slightly increasing by 0.2% from $674.3 million in 2017[106]. - The company’s revenue for the year ended December 31, 2018, was $3,912.2 million, an increase of $34.2 million or 0.9% compared to $3,878.0 million for the year ended December 31, 2017[111]. - North America accounted for $2,625.3 million or 67.1% of total revenue, reflecting an increase of $91.4 million or 3.6% from the previous year[113]. - The Asia-Pacific region's revenue decreased by $73.0 million or 8.5%, primarily due to a 3.7% decline in vehicle production in China[114]. - The company’s EPS revenue increased by $42.5 million, driven by strong demand for full-size trucks and SUVs in North America[116]. Operational Expansion - Significant strategic expansions included a new DL plant in Querétaro, Mexico, and a new EPS and DL plant in Chennai, India, set to begin production in Q1 2019[77]. - The company continues to diversify its product offerings and customer base, enhancing its market position in key regions such as China, India, Mexico, and Morocco[66]. - A new EPS and DL manufacturing facility is being established in Kenitra, Morocco, which is the company's first plant in Africa, expected to start production in Q2 2019[78]. - A new manufacturing plant is being set up in Wuhan, China, as part of a joint venture with Dongfeng, primarily supplying EPS for Dongfeng and DPCA projects, with initial production planned for Q2 2019[78]. - The company launched an advanced steering technology suite in 2018, integrating various technologies for enhanced safety and performance applicable to traditional, automated, and hybrid driving modes[79]. Management and Leadership - 樊毅 has been appointed as the executive director and vice president since 2013, with approximately 19 years of experience in the automotive industry[146]. - Yang Shengqun has 28 years of experience in the automotive industry and has been a non-executive director since March 2017[147]. - Zhang Jianxun, appointed as a non-executive director in March 2018, has held various leadership roles in investment and management since 2005[148]. - Yi Yongfa, an independent non-executive director since August 2017, has over 31 years of experience in auditing, direct investment, and corporate consulting[149]. - Liu Jianjun has been an independent non-executive director since June 2013, with a legal background and experience in various law firms since 1993[149]. - The company appointed William G. Quigley as Senior Vice President and Chief Financial Officer in June 2016, overseeing investor relations, treasury, capital financing, mergers and acquisitions, accounting, tax, and financial reporting[152]. - The management team has extensive experience in the automotive industry, with key members holding significant positions in various global companies[152][153][154][155]. Risk Management - The company faces significant operational risks due to internal process deficiencies and external events, which cannot be completely eliminated[167]. - Financial risks include market, liquidity, and credit risks, which may significantly impact the company's financial condition and operating performance[168]. - The automotive industry is cyclical and sensitive to general economic conditions, affecting sales and production levels[169]. - The company operates globally, with most revenues and expenses denominated in currencies other than the US dollar, exposing it to foreign exchange risks[174]. - The company must manage rising costs and potential shortages of raw materials, energy, and commodities, which could negatively impact financial performance[173]. Corporate Social Responsibility - The company made charitable donations totaling $0.6 million in 2018, with employees volunteering over 13,000 hours for local charitable work[190]. - The company is committed to environmental, social, and governance (ESG) practices, with a report to be published within three months of the annual report[189]. - The leadership team highlighted the commitment to sustainability, with plans to reduce carbon emissions by 25% over the next five years[145].