Core Viewpoint - The company adopts a production model based on sales orders and a procurement model based on production, allowing it to mitigate risks associated with silver price fluctuations through pricing strategies and hedging [2]. Group 1: Production and Procurement Models - The company implements a production model that aligns with sales orders and a procurement model that aligns with production needs, placing orders for silver powder on the same day sales orders are received [2]. - The pricing of conductive silver paste products and the main silver powder procurement prices are based on current or similar silver spot prices, enabling the company to pass on the impact of silver price fluctuations to downstream customers [2]. Group 2: Risk Management Strategies - To further reduce the risk of silver price volatility, the company hedges the silver price difference between sales orders and procurement orders using silver futures [2]. - The hedging strategy is closely related to the company's daily operational needs and has a clear business foundation [2]. Group 3: Financial Impact - Fluctuations in silver prices affect several financial statement items, including operating income, operating costs, investment income, and fair value change gains, but do not impact the company's long-term actual operating profits [2]. - During the recent rapid increase in silver prices, the company recognized fair value change losses for silver futures and silver leasing based on the silver spot price at the balance sheet date, while inventory cannot be recognized for appreciation [2].