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1 COMPANY DESCRIPTION - China XD Plastics Company Ltd., through its wholly owned subsidiary Harbin Xinda Macromolecule Material (“Xinda”), develops, manufactures, and distributes modied plastics, primarily for automotive applications. The Company’s specialized plastics are used in the exterior and interior trim and in the functional components of more than 30 automobile brands manufactured in China, including Audi, Red Flag, Volkswagen, and Mazda. China XD currently has the largest production base of modied plastics for automotive applications in China. It now has 396 full-time employees and is headquartered in Harbin, Heilongjiang Province, in Northeast China. Tremendous Market Demand - The modified plastics for automotive application has been growing at a f ast rate driven by the growth of the automotive industry in China. During the rst nine months of 2009, vehicle sales in China reached 9.7 million units, up 45% percent from a year earlier and on target to top 13.6 million units by t he end of 2009. The automotive industry in China is expected to grow at an average rate of 20% per year for the next three years. High Barriers to Entry - To qualify as a supplier to the OEMs of auto parts, manufacturers of modified plastics have to pass the quality management system examination developed by the International Automotive Task Force the “IATF”. China XD Plastics is certied by ISO/ TS16949:2002. It takes a long time for a company to prepare and pass the strict and complicated examinations and Quality Management System audit process, therefore, the certication process itself creates a high barrier to entry. Largest Number of Certications in the Industry - After years of research and development, the Company has obtained and currently holds 145 product certications, the largest number of certications of modied plastics for automotive applications held by any Chinese company. Leading Research and Development Institute in China  - The Company’s national leading research institute employs 77 researchers, 90% of them hold either a Bachelor, a Master, or a PhD degree. The elite researchers of the Company’s research institute, on average, have over 10 years of R&D experience in modied plastics. The institute is equipped with more than 80 sets of state-of-the-art equipments. Proven Business Model - Established distribution network and customer technical services support the rapid growth of demand for our modied plastic products. The 2008 reveue and net income growth rate was 154.8% and 141 .5%, respectively. Seasoned Management Team - China XD’s core management team has extensive experience in the industry of modified plastics for automotive application. They have over 56 years of combined industry experience in technology, manufacturing, marketing and management. Dened Growth Strategies - By 2011, the Company plans to expand the production scale in northeast China to 200,000 tons. By 2013, the Company expects to establish another prod uction ba se in southern China through acquisition and construction of additional 100,000 tons of production scale, bringing total production scale to 300,000 tons.  INVESTMENT HIGHLIGHTS CONQUER THE WORLD WITH TECHNOLOGY China XD Plastics Company Limited: CXDC Stock Price (02/23/10): $ 7 .95 Market Capitaliz ation: $ 360.9 MM Shares Outstanding-Fully Diluted**: 45.4 MM Revenues (TTM): $ 114.5 MM Net Income (TTM)*: $ 18.4 MM EPS-Fully Diluted* *: $ 0.45 Fiscal Year End: December 31 * Excluding $3.2 million non-cash stock compensation expense **Diluted Shares Outstan ding (As of December 31, 2009), EPS and PE (TTM ended September 30, 2009) $13.4 $34.2 $75.8 $55.8 $94.5 2006 2007 2008 9Mon 2008 9Mon 2009   C   A   G    R    1    3    8    % Revenues ($ Millions)    Y   o    Y    G   r   o   w    t    h     6    9  .    3   % 0 20 40 60 80 100 Gross Profit ($ Millions)    Y   o    Y    G   r   o   w    t    h    4    9  .    7   % $2.8 $6.3 $17.3 $13.9 $20.8 2006 2007 2008 9 Mon 2008 9Mon 2009   C   A   G    R    1   4    9    % 0 5 10 15 20 EPS-Diluted $0.06 $0.14 $0.35 N/A $0.41 Net Income ($ Millions)    Y   o    Y    G   r   o   w    t    h   4   1  .    3   % $2.2 $5.3 $13.7 $11.4 $16.2* 2006 2007 2008 9 Mon 2008 9Mon 2009   C   A   G    R   1    5    0    % * Excluding $3.2 million non-cash stock compensation expense 0 5 10 15 20

03 02 2010 CXDC Profile(en)

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Page 1: 03 02 2010 CXDC Profile(en)

8/9/2019 03 02 2010 CXDC Profile(en)

http://slidepdf.com/reader/full/03-02-2010-cxdc-profileen 1/2

COMPANY DESCRIPTION - China XD Plastics Company Ltd., through its wholly owne

subsidiary Harbin Xinda Macromolecule Material (“Xinda”), develops, manufactures, and distribute

modied plastics, primarily for automotive applications. The Company’s specialized plastics a

used in the exterior and interior trim and in the functional components of more than 30 automobi

brands manufactured in China, including Audi, Red Flag, Volkswagen, and Mazda. China X

currently has the largest production base of modied plastics for automotive applications in Chin

It now has 396 full-time employees and is headquartered in Harbin, Heilongjiang Province,

Northeast China.

Tremendous Market Demand - The modified plastics for automotive application has be

growing at a f ast rate driven by the growth of the automotive industry in China. During the r

nine months of 2009, vehicle sales in China reached 9.7 million units, up 45% percent from a ye

earlier and on target to top 13.6 million units by the end of 2009. The automotive industry in Chin

is expected to grow at an average rate of 20% per year for the next three years.

High Barriers to Entry - To qualify as a supplier to the OEMs of auto parts, manufacture

of modified plastics have to pass the quality management system examination develope

by the International Automotive Task Force the “IATF”. China XD Plastics is certied by IS

TS16949:2002. It takes a long time for a company to prepare and pass the strict and complicate

examinations and Quality Management System audit process, therefore, the certication proces

itself creates a high barrier to entry.

Largest Number of Certications in the Industry - After years of research and developmen

the Company has obtained and currently holds 145 product certications, the largest number

certications of modied plastics for automotive applications held by any Chinese company.

Leading Research and Development Institute in China  - The Company’s national leadin

research institute employs 77 researchers, 90% of them hold either a Bachelor, a Master, or

PhD degree. The elite researchers of the Company’s research institute, on average, have over 1

years of R&D experience in modied plastics. The institute is equipped with more than 80 sets

state-of-the-art equipments.

Proven Business Model - Established distribution network and customer  technical servic

support the rapid growth of demand for our modied plastic products. The 2008 reveue and n

income growth rate was 154.8% and 141.5%, respectively.

Seasoned Management Team - China XD’s core management team has extensive experien

in the industry of modified plastics for automotive application. They have over 56 years

combined industry experience in technology, manufacturing, marketing and management.

Dened Growth Strategies - By 2011, the Company plans to expand the production scale

northeast China to 200,000 tons. By 2013, the Company expects to establish another production ba

in southern China through acquisition and construction of additional 100,000 tons of productio

scale, bringing total production scale to 300,000 tons.

 INVESTMENT HIGHLIGHTS

CONQUER THE WORLD WITH TECHNOLOGY

hina XD Plastics Company Limited: CXDCtock Price (02/23/10): $ 7.95

Market Capitalization: $ 360.9 MMhares Outstanding-Fully Diluted**:  45.4 MMevenues (TTM): $ 114.5 MMet Income (TTM)*: $ 18.4 MMPS-Fully Diluted**: $ 0.45iscal Year End: December 31

Excluding $3.2 million non-cash stock compensation expense Diluted Shares Outstan ding (As of December 31, 2009), EPS and PE (TTM ended September 30, 2009) 

$13.4

$34.2

$75.8

$55.8

$94.5

2006 2007 2008 9Mon

2008

9Mon

2009

  C  A  G

   R   1   3   8

   %

Revenues ($ Millions)

   Y  o   Y

   G  r  o  w

   t   h    6   9 .   3  %

0

20

40

60

80

100

Gross Profit ($ Millions)

   Y  o   Y 

  G  r  o  w

   t   h    4   9

 .   7  %

$2.8

$6.3

$17.3

$13.9

$20.8

2006 2007 2008 9Mon

2008

9Mon

2009

  C  A  G

   R   1  4   9

   %

0

5

10

15

20

S-Diluted $0.06 $0.14 $0.35 N/A $0.41

Net Income ($ Millions)

   Y  o   Y 

  G  r  o  w

   t   h  4  1

 .   3  %

$2.2

$5.3

$13.7$11.4

$16.2*

2006 2007 2008 9Mon

2008

9Mon

2009

  C  A  G   R

  1   5   0   %

cluding $3.2 million non-cash stock compensation expense

0

5

10

15

20

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Research & Development - The Company’s Research Institute is a vital component of its strategy

to build leadership position in the modied plastics industry in China and abroad. The Institute

works closely with a number of the leading universities and research institutes in Chinaincluding the Changchun Institute of Applied Chemistry of the Chinese Academy of Science, the

Beijing Chemical Engineering Institute, Tsinghua University, the Harbin Institute of Technology

the Northeast Forestry University, and Jilin University. The products developed by the Companyhave been listed in several National level Projects, including the National Torch Project, the

National Key New Product Project, and the National Spark Plan Project. Through the efforts o

our engineers, the Company has 11 pending patents accepted by the State Intellectual PropertyOfce of the P.R.C. and has received 145 product certications granted by major automobile OEMs.

Customer  - China XD’s end-users are among the top ten car manufacturers in China, including First AutomobileWorks (“FAW Group”) - the largest auto maker in China, HF Automobile Group, and Shenyang Brilliant Auto. The

followings are the typical end-user brands:

MANAGEMENT TEAM 

Jie Han, Chairman and Chief Executive Ofcer : With 26 years of industry

experience, Mr. Han is an expert in the modied plastic industry. He currentlyserves as an executive director of China Plastic Processing Industry Association

an outstanding entrepreneur at the industry of modied plastics, and director o

the Heilongjiang Industry Commerce Association. In addition, Mr. Han serves as arepresentative of the Harbin Municipal People’s Congress.

Taylor Zhang, Chief Financial Ofcer and Director : Mr. Zhang has over sevenyears of experience in nance management and operation serving public compa

nies in a broad range of industries in the United States. He has served as chief nan

cial ofcer and other nancial related positions in publicly listed companies in USincluding, nancial analyst at the New York Private Equity.

Qingwei Ma, Chief Operating Ofcer and Director : Mr. Ma has over 13 yearsof experience in the modied plastics industry in China where he has established

strong sales network in the Industry, and established effective system of purchasing

production and sales.

Junjie Ma, Chief Technology Ofcer : Mr. Ma has over 13 years of experience

in the modied plastic industry. He successfully established the research instituteand helped the Company to obtain more than 100 certications from Chinese automo

bile OEMs, the largest number of certifications held by any Chinese company

He has organized and formed a top class science advisory team and maintaineda close collaboration relationship with well-known Chinese macromolecule R&D

institutes and universities. As a result, Mr. Ma has taken full advantage of re

search institute’s state-of-the-art equipments and top technique talents to keepthe institute’s leading position in China.

Business Risks and Forward-Looking StatementsAny statements set forth above that are not historical facts are forward-looking statements that involve risks and uncertainties that could cause actual resultsto differ materially from those in the forward-looking statements. Potential risks and uncertainties include, but are not limited to, such factors as changes in po-litical, business and economic conditions, uctuations in product demand, the Company’s ability to maintain customer and supplier relationships, technologicaad¬vancements, impact of competitive products and pricing, growth in targeted markets, access to nancing, and other information detailed from time to time inthe Company’s lings with the United States Securities and Exchange Commission. Readers are advised that this information is intended for the use of investmenprofessionals. Anyone interested in obtaining information on the Company should contact China XD Plastics (CXDC) or CCG, as set forth above; to receive thCompany’s most recent nancial reports. This Financial Prole of CXDC was developed by the Company and is intended solely for informational purposes and inot to be construed as an offer to sell or the solicitation of an offer to buy the Company’s stock. This Prole is based upon information available to the public, as weas other information from sources which management believes to be reliable, but is not guaranteed by CXDC as being accurate nor does it purport to be completeOpinions expressed herein are those of management as of the date of publication and are subject to change without notice.

Investor Relations Contact

CCG Investor RelationsMr. Crocker Coulson, PresidentPhone: +1-646-213-1915 (New York)Mr. Ed Job, CFAPhone: +1-646-213-1914 (New York)Email:[email protected]: www.ccgirasia.com

Company Contact

China XD Plastics Company Ltd.Mr. Taylor Zhang, CFOPhone: +1-212-747-1118(New York)Mr. Allan Lao, IR Director Phone: +86-451-8438-6600 (China)Email: [email protected]: www.chinaxd.net

Harbin

Changchun

Nanjing

Shenyang

Beijing

Tianjing

Shanghai

Zhejiang

Chongqing

Guangzhou

Shenzhen

Wuhan

Daqing

Qingdao

Fuzhou

Chengdu

Harbin

Changchun

Nanjing

Shenyang

Beijing

Tianjing

Shanghai

Zhejiang

Chongqing

Guangzhou

Shenzhen

Wuhan

Daqing

Qingdao

Fuzhou

Chengdu

Sales & Marketing Network

Currently, the company is focusing mainly oncoverage of the Northeast China

By 2013, the company plans to cover NorthChina markets and becomes one of the major suppliers in this region

By 2015, the company plans to cover East Chinamarkets and becomes one of the major suppliersin this region