Core Viewpoint - The company has made significant progress in financial improvement, governance optimization, and strategic fundraising, laying a solid foundation for future development [1] Financial Performance - In the first half of 2025, the company achieved operating revenue of 80.9388 million yuan, showing a decline year-on-year due to adjustments in the scope of consolidation, but the reduction in losses on the profit side was notable [2] - The net profit attributable to shareholders was -35.4598 million yuan, a year-on-year reduction in losses of 37.71% [2] - The net profit attributable to shareholders after deducting non-recurring gains and losses was -35.8423 million yuan, a year-on-year reduction in losses of 41.15%, indicating a continued alleviation of profit pressure [2] - As of June 30, 2025, the net assets attributable to shareholders reached 202 million yuan, an increase of 32.86% from the end of the previous year, indicating a more robust capital structure [2] Governance and Risk Management - The company has made significant advancements in governance and risk management, with the Shenzhen Stock Exchange approving the removal of other risk warnings, changing the stock name from "ST Huijin" to "Huijin Co., Ltd." on May 26, 2025, effectively mitigating previous operational risks [3] - The company has optimized its governance system, holding board meetings and a shareholder meeting to approve changes in business scope and amend the articles of association, adding and revising 27 governance systems [3] - As of June 30, 2025, the company has completed the registration and filing procedures for changes in business scope and articles of association, enhancing the level of governance [3] Strategic Fundraising - To optimize its capital structure and alleviate financial pressure, the company successfully introduced strategic investors for its subsidiary [4] - On April 30, 2025, the board approved a capital increase for the subsidiary Hebei Huijin Electromechanical Co., Ltd., with China CITIC Financial Asset Management Co., Ltd. investing 137 million yuan in Huijin Electromechanical and 101 million yuan in Zhongke Tuoda Technology Co., Ltd. [4] - The capital raised will be used to repay existing interest-bearing debts, directly reducing financial costs, while both subsidiaries remain controlled by the company [4]

Core Viewpoint - Company is implementing a significant strategic initiative to attract long-term investors and enhance its integrated paper packaging business, driven by the need to improve sustainability and core competitiveness [1] Group 1: Strategic Move - Company plans to establish a partnership with Xinsengli Bao Equity Investment Co., a subsidiary of Cinda Capital, to jointly invest 2.978 billion yuan in the establishment of Wuhu Shengying Enterprise Management Consulting Partnership [2] - The company will transfer part of its equity in subsidiaries, including 100% of Guangdong Shanying and 36.56% of Xiangheng Packaging, to raise over 7 billion yuan [2][3] - The funds raised will be used for production operations, research and development of new production capabilities, and upgrading existing production lines to further develop the integrated paper packaging business [3] Group 2: Financial Situation - As of March 31, 2025, Guangdong Shanying has total assets of 5.107 billion yuan and net assets of 2.191 billion yuan, while Xiangheng Packaging has total assets of 6.579 billion yuan and net assets of 2.199 billion yuan, together accounting for 21.65% and 29.05% of the company's total assets and equity, respectively [3] - In 2024, Guangdong Shanying achieved revenue of 3.019 billion yuan and net profit of 25.138 million yuan, while Xiangheng Packaging generated revenue of 7.173 billion yuan and net profit of 81.543 million yuan, together representing 34.87% of the company's total revenue [4] Group 3: Historical Context and Challenges - Company has faced significant challenges due to high debt levels and industry downturns, leading to a net profit loss in 2024 [1][5] - Since 2013, the company has pursued aggressive debt-fueled expansion, resulting in cumulative investment cash outflows of approximately 27.5 billion yuan from 2014 to September 2024 [6] - The company has been forced to frequently seek external financing, with direct financing totaling 26.9 billion yuan and bank loans amounting to 25.395 billion yuan over the past decade [7]