Interim Results 2010

August 2010

(Stock code: 631)

1

Disclaimer

These materials have been prepared solely for the use at the presentation by Sany Heavy Equipment

International Holdings Company Limited (“the Company”) and have not been independently verified. No

representation or warranty, expressed or implied, is made and no reliance should be placed on the accuracy,

fairness, correctness or completeness of the information presented or contained in these materials. The

Company or any of its affiliates, advisers or representatives accepts no liability whatsoever for any loss

howsoever arising from any information presented or contained in these materials. The information presented

or contained in these materials is subject to change without notice and its accuracy is not guaranteed.

These materials contain certain forward-looking statements with respect to the Company, including its beliefs

and expectations about the future as at the date of this presentation. These forward-looking statements are

based on a number of assumptions regarding the Company's operations and factors beyond the Company's

control, including but not limited to, the political and economic environment in which the Company and its

subsidiaries will operate in the future. Our actual results of operations, financial condition or business

prospects may differ materially from those expressed or implied in these forward-looking statements for a

variety of reasons and as such, no reliance should be placed on these forward-looking statements. The

Company and its affiliates, advisors and representatives undertake no obligation to update these forward-

looking statements for events or circumstances that occur subsequent to such dates.

2

Agenda

I. Key Achievements

IV. Corporate Culture and Development Strategies

III. Business Review

V. Open Forum

II. Financial Review

Key Achievements

4

Key Achievements

Revenue grew strongly by 46.9% and Profit attributable to equity holders

of the Company surged 36.7%

Revenue derived from sales of new products amounted to RMB220 million,

higher than the level achieved for the full year of 2009

Gross profit margin for every product was improved, consolidated gross

profit margin reached 45.1%

Applied for a total of 111 R&D patents, of which 42 are invention patents.

Applied for one R&D patent every 39 hours and one invention patent every

100 hours on average

Financial Review

6

Financial Highlights

For the six months

ended 30 June

(RMB million) 2010 2009 Change

Revenue 1,310.0 891.6 +46.9%

Gross profit 590.2 438.0 +34.7%

Profit before tax 364.5 278.7 +30.8%

Profit attributable to equity

holders of the Company 341.9 250.2 +36.7%

(%) For the six months

ended 30 June

2010 2009 Change Full year 2009 Change

Consolidated GPM 45.1 49.1 -4.0pp 47.6 -2.5pp

PBT Margin 27.8 31.3 -3.5pp 27.6 +0.2pp

NP Margin 26.1 28.1 -2.0pp 25.8 +0.3pp

pp = percentage points

7

Effective Cost Control

Administrative expenses

For the six months ended 30 June 2010, the Group had incurred no financial cost

RMB million

Sales and distribution cost

151.6

85.5

FY2009

232.8

11.6%9.6%

12.20%

0

50

100

150

200

250

300

1H2009 1H2010

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Sales and distribution cost Interim by revenue %

Annual by revenue %

RMB million

95.172.3

FY2009

171.3

7.3%8.1%

9.0%

0

50

100

150

200

250

1H2009 1H2010

0.0%

2.0%

4.0%

6.0%

8.0%

Administrative expenses Interim by revenue %

Annual by revenue %

8

Strong Balance Sheet

For the six months

ended 30 June

(RMB million) 2010 2009 Change

Current assets 4,440.0 2,054.3 116.3%

Non-current assets 1,117.7 639.4 74.8%

Total assets 5,557.7 2,693.7 106.3%

Current liabilities 840.0 805.2 4.3%

Non-current liabilities 281.4 260.8 7.9%

Total liabilities 1,121.4 1,066.0 10.3%

Net assets 4,436.3 1,627.7 627.6%

Cash and cash equivalents 1,706.9 273.9 523.2%

Current ratio (times) 5.3X 2.6X +2.7X

For the six months ended 30 June 2010, the Group had abundant capital

and no bank borrowings

9

Working Capital Management

(Days) 1H2010 1H2009 Change

Average inventory turnover days 149.0 172.0 -23.0

Trade receivables and notes receivable

turnover days 148.7 149.7 -1.0

Trade accounts payable and notes payable

turnover days (85.7) (106.9) -21.2

Cash turnover cycle 212.0 214.8 -2.8

10

Cash Flow

RMB ’000 1H2010

(Unaudited)

1H2009

(Audited) Change

Net cash inflow (outflow) from

operating activities (886,705) 47,154 -933,859

Net cash inflow (outflow) from

investing activities (1062,135) 392,153 -1,454,288

Net cash inflow (outflow) from

financing activities 3,768 (225,233) +229,001

Cash and cash equivalents at end

of period 912,928 273,863 +639,065

Business Review

12

Industry Outlook

10.4 11.8

21.1

29.0

49.6

58.0

66.6

0

10

20

30

40

50

60

70

2003 2004 2005 2006 2007 2008 2009

RMB billion

354

1,260 1,246

1,847

2,552

3,200

845

0

500

1,000

1,500

2,000

2,500

3,000

3,500

2003 2004 2005 2006 2007 2008 2009E

Total sales of coal mining related machinery in China

Sales of roadheaders in China Sales of coal mining machines in China

1,012

2,375

2,980 3,003

3,636

4,115

1,233

0

1,500

3,000

4,500

2003 2004 2005 2006 2007 2008 2009E

Source: China National Coal Mining Machinery Industry Association

RMB million RMB million

Construction of new coal mines

Upgrade and replacement demand from existing

coal mine products

Mechanization of coal mining industry

Key factors driving the demand

for coal mining machinery

13

Major Product Categories

Our Four Major Product Categories

Other Products

Combined coal mining units Coal mine

transportation vehicles

Coal Mine Concrete Pumps

Soft-rock Roadheaders Shuttle Car

Multi-purpose Vehicle

Support and

Transportation Vehicle

Roadheaders

Hard-rock Roadheaders

Semi/Full-automated

combined coal mining unit

Continuous Mining Machinery

Coal Loading Machinery

Drilling and Loading Machinery Combined by coal mining

machines(shearer), hydraulic

support system, scraper

conveyors(AFC) and

centralized control system

14

Unparalled R&D Capabilities

43.9

22.4

FY2009

61.1

0

10

20

30

40

50

60

70

1H2009 1H2010

R&D achievements in 1H2010

Applied for a total of 111 R&D patents, of which 42 are invention patents. Applied for one

R&D patent every 39 hours and one invention patent every 100 hours

No. of R&D professionals grew 30% to 533

The ratio of R&D expenses to revenue increased 0.8p.p. to 3.4%. The Group will maintain

the ratio of R&D investment at no lower than 3%

R&D investments

RMB million To enhance the performance, efficiency and safety of

our products

To expand our current product portfolio by developing

new products with cutting-edge technology

To upgrade production technologies and professional

know-how and speed up migration to self-developed

components

15

Sales and Services Network

Broad network covering 19

provinces in China, including:

• 17 sales centers

• 18 services centers

• 57 service outlets

Continue to expand international

distribution network

Increase operation with the third

independent party and further

promote financing sales model

15

16

Expanding Production Capacity Existing production capacity upgrading New production facilities

Expand the existing production capacity by

upgrading facilities and optimizing

production process. Currently, the Group’s

production efficiency has been significantly

improved compared with 1H2009

Located in Shenyang City with total GFA of

630,000 sq.m.

Under construction and expected to

commence production in2012

Acquired a land parcel during the first half of

2010 in Taiyuan, Shanxi province,

earmarked for use in further capacity

expansion

17

Corporate Culture and

Development Strategies

18

Corporate Culture

Help employees

succeed

Quality changes

the world

All for the

customers

All start with

innovations

幫助員工成功 一切為了客戶

一切源於創新 品質改變世界

19

Business Strategies

We aim to develop and maintain a product portfolio with a leading position

in each of our product segments, in particular, we aim to become a leading one-stop coal mining solutions and comprehensive coal mining equipment provider

Our Vision

Our strategy for

the medium term

Continue to invest in R&D and develop new products

Maintain and further enhance competitiveness and expand customer base

Expand and upgrade production capacity to meet growing market demand

Broader product mix and strengthen the vertical integration

19

Open Forum