Core Viewpoint - The company has successfully completed the entire process of its 200,000 tons/year dicarboxylic acid project, which has now entered the trial production phase [1] Group 1: Project Details - The project utilizes proprietary technology and has a total investment of 867 million yuan [1] - It is expected to produce 200,000 tons of dicarboxylic acid annually [1] - Funding for the project is sourced from the company's own funds and bank loans [1] Group 2: Strategic Implications - The completion of this project will enhance production capacity and optimize operational efficiency [1] - It is anticipated to increase market share and improve competitive strength [1] - The project aligns with the company's development strategy and long-term planning, offering significant economic and social benefits [1]

Core Viewpoint - The company reported a decline in revenue and net profit for the first half of 2025, with a significant drop in key product prices due to weak demand and increased production capacity in the industry [1][2][4]. Financial Performance - In H1 2025, the company achieved operating revenue of 15.76 billion yuan, a year-on-year decrease of 7.1% - The net profit attributable to shareholders was 1.57 billion yuan, down 29.5% year-on-year - The net profit after deducting non-recurring items was 1.56 billion yuan, a decrease of 30.3% year-on-year - In Q2 2025, the company recorded operating revenue of 7.99 billion yuan, a year-on-year decline of 11.2% but a quarter-on-quarter increase of 2.8% [1]. Product Pricing and Cost Structure - The prices of major products such as urea, acetic acid, and DMF saw significant year-on-year declines, with decreases of 18.2%, 20.8%, and 11.4% respectively - However, some products experienced a quarter-on-quarter price recovery, with urea prices increasing by 7.5% [2]. - The price spread for key products narrowed as the price declines for some products outpaced the drop in raw material costs [2]. Production and Sales Growth - The company’s production and sales volumes for new energy materials and chemical fertilizers increased significantly in H1 2025, with production up 7.5% and sales up 13.6% year-on-year - In Q2 2025, production and sales volumes continued to grow, with production increasing by 2.6% and sales by 6.5% year-on-year [3]. Capacity Expansion and Future Projects - The company is expanding its production capacity with new projects nearing completion, including a 200,000-ton/year BDO and NMP integrated project - A gasification platform upgrade project is planned with an investment of 3.039 billion yuan, expected to generate annual revenue of 3.665 billion yuan upon completion [4]. - The company’s long-term growth prospects remain strong due to ongoing capacity expansion and product matrix improvement [4]. Profit Forecast and Investment Rating - The profit forecast for 2025-2027 has been adjusted, with net profits projected at 3.5 billion, 4.23 billion, and 5.09 billion yuan respectively - The current price-to-earnings ratio is estimated at 16.0, 13.2, and 11.0 times for the respective years, maintaining a "buy" rating [4].

Core Viewpoint - The company, Shandong Hualu Hengsheng Chemical Co., Ltd., held its third temporary board meeting in 2025, where significant resolutions were passed regarding the cancellation of the supervisory board and amendments to the company's articles of association [1][2]. Group 1 - The board meeting was attended by all 11 directors, and the resolutions passed were deemed legal and effective [1]. - The resolution to cancel the supervisory board and amend the articles of association received unanimous approval with 11 votes in favor, 0 against, and 0 abstentions [1][2]. - The proposed changes to governance systems, including the independent director system and management of fundraising, will also require approval at the upcoming shareholder meeting [2]. Group 2 - A resolution to convene the third temporary shareholder meeting of 2025 was also passed unanimously with 11 votes in favor, 0 against, and 0 abstentions [2]. - Detailed announcements regarding the cancellation of the supervisory board and the amendments to the articles of association will be made available on the company's official website [1][2].

Core Points - The company has decided to abolish its supervisory board and related systems, following the implementation of new regulations effective from July 1, 2024 [1][2] - The resolution was passed unanimously by the three attending supervisors during the meeting held on September 4, 2025 [1] - The company expressed gratitude for the contributions made by the supervisory board during their tenure [2] Summary by Sections - **Meeting Details** - The ninth supervisory board's second temporary meeting was held via communication on September 4, 2025, with all three supervisors present [1] - The meeting complied with the relevant provisions of the Company Law and the company's articles of association [1] - **Resolution Passed** - The resolution to cancel the supervisory board and abolish related systems was approved with a vote of 3 in favor, 0 against, and 0 abstentions [1] - The decision aligns with the new Company Law and related regulatory documents [1] - **Future Steps** - The proposal will be submitted for approval at the company's third temporary shareholders' meeting in 2025 [2] - **Acknowledgment** - The company acknowledged the diligent efforts of the supervisory board during their term and thanked them for their contributions to the company's development [2]

Group 1 - The company, Shandong Hualu Hengsheng Chemical Co., Ltd., is convening its third extraordinary general meeting of shareholders in 2025 on September 26, 2025 [1][2] - The meeting will utilize a combination of on-site and online voting methods, with specific voting times outlined for both platforms [2][3] - Shareholders must register to attend the meeting, with registration deadlines and requirements specified, including the need for identification and proof of shareholding [5][6] Group 2 - The agenda for the meeting includes non-cumulative voting proposals that have been approved in previous board and supervisory meetings [2][6] - Shareholders holding multiple accounts can vote through any of their accounts, but the first vote will be considered valid for all accounts [4][6] - The company has provided contact information for inquiries related to the meeting, including phone and email details [5]

Core Viewpoint - The document outlines the management measures for the shareholding changes of directors and senior management of Shandong Hualu Hengsheng Chemical Co., Ltd, aiming to regulate their shareholding activities and maintain market order [1]. Group 1: General Provisions - The management measures are established based on relevant laws and regulations, including the Company Law and Securities Law of the People's Republic of China [1]. - The company and its directors and senior management must comply with these management measures [1]. Group 2: Restrictions on Shareholding Changes - Directors and senior management are prohibited from transferring their shares under specific circumstances, such as within one year of the company's stock listing and within six months after leaving their positions [2]. - Additional restrictions apply if the company is under investigation for securities violations or if the directors and senior management are subject to administrative penalties [2]. Group 3: Transfer Limitations - Directors and senior management can only transfer up to 25% of their total shareholding during their term and within six months after their term ends, with exceptions for certain circumstances [2]. - New shares acquired through various means, such as stock issuance or equity incentive plans, have specific transfer limits in the year of acquisition [3]. Group 4: Reporting and Disclosure - Directors and senior management must report their shareholding changes to the stock exchange within two trading days of the change occurring [17]. - The company is responsible for ensuring the accuracy and timeliness of the reported data regarding shareholding changes [16]. Group 5: Compliance and Accountability - The company’s board secretary is tasked with managing the shareholding data and ensuring compliance with reporting requirements [8]. - Violations of these management measures may result in penalties from regulatory authorities and potential civil liabilities for losses incurred by investors [19].

Core Viewpoint - The company has established a system for accountability regarding significant errors in annual report disclosures to enhance the quality and transparency of information provided to stakeholders [1][2]. Group 1: General Principles - The system aims to improve the company's operational standards and ensure the authenticity, accuracy, completeness, and timeliness of annual report disclosures [1]. - Accountability refers to the responsibility of individuals for significant errors in annual report disclosures that lead to substantial economic losses or negative social impacts [1][2]. - The system applies to various stakeholders, including directors, senior management, department heads, subsidiary leaders, major shareholders, and others involved in the annual report disclosure process [1]. Group 2: Definition of Significant Errors - Significant errors in annual report disclosures include major accounting mistakes, substantial omissions, and significant discrepancies in performance forecasts or reports [2]. - The system emphasizes principles such as objectivity, accountability, and the correlation between rights and responsibilities [2][3]. Group 3: Responsibility and Accountability - Responsibility for significant errors is determined based on specific duties related to information collection, preparation, submission, review, and disclosure [3]. - In cases of public reprimands or criticisms from regulatory bodies due to significant errors, the internal audit department must investigate the causes and recommend corrective actions [3][4]. Group 4: Forms and Types of Accountability - The main forms of accountability for significant errors in annual report disclosures include disciplinary actions and potential economic penalties determined by the board of directors [4]. - The results of accountability measures will be incorporated into the annual performance evaluation of relevant departments and personnel [4]. Group 5: Implementation and Amendments - The system will be executed in accordance with national laws and regulations, and any amendments will be subject to board approval [6].

Core Viewpoint - The internal audit system of Shandong Hualu Hengsheng Chemical Co., Ltd. aims to enhance internal management and control, ensure compliance, protect investor rights, and improve operational efficiency [1][2]. Group 1: Internal Audit Purpose and Scope - The purpose of internal audit is to promote the establishment and improvement of internal controls, standardize business operations, effectively control costs, improve management, mitigate operational risks, and increase company value [1][2]. - The scope of internal audit includes all departments, subsidiaries, and relevant personnel within the company, focusing on the effectiveness of internal controls and risk management [1][2]. Group 2: Responsibilities and Authority of Internal Audit - The internal audit department operates independently under the board of directors and is responsible for conducting audits, reporting findings, and ensuring compliance with laws and regulations [2][3]. - The internal audit department has the authority to request necessary documents, inspect financial activities, and investigate any irregularities [6][7]. Group 3: Audit Personnel Standards - Audit personnel must possess relevant professional knowledge in auditing, accounting, and legal regulations, and should have practical experience [3][4]. - Auditors are required to adhere to ethical standards, maintain independence, and avoid conflicts of interest during their work [4][5]. Group 4: Audit Procedures and Reporting - The internal audit process consists of preparation, implementation, and reporting phases, ensuring thorough evaluation and documentation of findings [15][16]. - Audit reports must clearly outline the audit scope, procedures, and significant findings, and must be communicated effectively to the audited units [46][47]. Group 5: Compliance and Accountability - The company emphasizes the importance of compliance with internal control systems and holds individuals accountable for violations, with potential disciplinary actions for non-compliance [54][55]. - The internal audit department is tasked with monitoring the implementation of audit recommendations and ensuring corrective actions are taken [50][51].

Group 1 - The purpose of the remuneration management system is to promote sustainable development and maximize shareholder interests by motivating the decision-making management team [1][2] - Independent directors receive an annual allowance of 120,000 RMB (before tax) and are reimbursed for reasonable expenses incurred while performing their duties [1] - Non-independent directors also receive an annual allowance of 120,000 RMB (before tax) and are similarly reimbursed for reasonable expenses [1] Group 2 - Directors holding specific management positions are subject to an annual salary system, with remuneration plans proposed by the remuneration and assessment committee based on the completion of annual business plans [1] - The company will implement a long-term incentive plan in accordance with national policies, subject to approval by the shareholders' meeting and relevant authorities [2]

Core Viewpoint - The document outlines the measures and principles established by Shandong Hualu Hengsheng Chemical Co., Ltd. to prevent the misuse of company funds by controlling shareholders and related parties, ensuring the protection of investors' rights and interests [1][2]. Group 1: General Principles - The system aims to regulate financial transactions between the company and its controlling shareholders or related parties, establishing a long-term mechanism to prevent fund misuse [1]. - The system applies to the company and its subsidiaries included in the consolidated financial statements [1]. Group 2: Types of Fund Misuse - Fund misuse includes operational fund occupation through related transactions such as procurement and sales, as well as non-operational fund occupation for expenses like wages and advertising [2]. - Non-operational fund occupation also covers direct or indirect loans to related parties without genuine transaction backgrounds [2]. Group 3: Prevention Principles - The company must prevent any direct or indirect occupation of funds, assets, and resources by controlling shareholders and related parties [2]. - Related transactions must comply with relevant regulations and be settled promptly to avoid non-operational fund occupation [2]. Group 4: Responsibilities of Management - The chairman of the board is the primary responsible person for preventing fund occupation, while the general manager and financial officer share secondary responsibilities [3]. - The financial department is tasked with regular inspections of fund transactions with related parties, while the audit department supervises compliance with internal controls [3]. Group 5: Measures for Fund Recovery - In cases of asset occupation by controlling shareholders, the board must take effective measures to stop the infringement and seek compensation [4]. - If fund occupation occurs, the company can apply for judicial freezing of shares held by the controlling shareholder upon approval from independent directors [4]. Group 6: Accountability and Penalties - Directors and senior management who assist or condone fund occupation will face disciplinary actions, and the company can seek compensation for losses incurred [8]. - Violations of the system will result in penalties for responsible individuals, and the company retains the right to pursue legal accountability [8].