Group 1 - The company held an earnings briefing on September 15, 2025, from 14:00 to 17:00 via the Panoramic Network's investor relations platform [2] - The chairman, financial director, and board secretary attended the meeting to address investor inquiries [2] - The company clarified that recent shareholder reductions were based on personal funding needs and complied with prior reduction commitments, ensuring legal and regulatory adherence [2][2] Group 2 - The company emphasized its commitment to its core business and aims to enhance operational performance to boost investor confidence [2] - The company will disclose the latest number of shareholders in quarterly and annual reports, accessible through the Giant Tide Information Network [2] - The company's wholly-owned subsidiary completed the construction of a project for producing 3,000 tons of synthetic flavoring agents by June 2024, achieving readiness for use [2]

Group 1: Investor Relations Activities - The investor relations activity was an earnings briefing held on September 15, 2025, from 14:00 to 17:00 via an online platform [2] - The meeting was attended by key company representatives including Chairman Hua Wenliang, CFO Xu Xiayun, and Secretary of the Board Chen Liang [2] Group 2: Shareholder Concerns - Investors raised concerns regarding the continuous decline in the company's stock price and the full reduction of holdings by major shareholders, questioning the company's future prospects [2] - The company clarified that the reduction was based on the shareholders' personal financial needs and complied with prior commitments, assuring that it does not affect their confidence in the company's future [2] Group 3: Company Performance and Future Plans - The company emphasized its commitment to focusing on its core business and improving operational performance to enhance investor confidence and fulfill its responsibilities to all investors [2] - The construction of the Hefei factory, which is part of the "3000 tons per year of propylene glycol series synthetic fragrance project," was completed in 2024 and is now in a usable state [3]

Core Viewpoint - Huaye Fragrance (华业香料) announced a share reduction plan by its controlling shareholder and actual controller, Hu Wenliang, who intends to reduce his holdings by up to 2,243,940 shares, representing 3% of the company's total share capital [1] Group 1: Share Reduction Plan - Hu Wenliang plans to reduce his shareholding within three months after a 15 trading day period from the announcement date, with a maximum of 2,243,940 shares [1] - The reduction will occur through two methods: a maximum of 1% of the total share capital via centralized bidding and up to 2% via block trading [1] Group 2: Historical Shareholding and Financial Data - As of January 13, 2025, Huaye Fragrance reported that a related party, Zhongrun Investment, completed a share reduction of 745,500 shares, equating to 1% of the total share capital, at an average price of 20.79 yuan per share, totaling approximately 15.49 million yuan [2][3] - The company was listed on the Shenzhen Stock Exchange on September 16, 2020, with an initial public offering of 14.35 million shares at a price of 18.59 yuan per share, raising a total of 267 million yuan [3] - The net profit attributable to shareholders over the past four years totaled 56 million yuan, with annual revenues of 246 million yuan, 255 million yuan, 269 million yuan, and 345 million yuan from 2021 to 2024 [4]

Core Viewpoint - Huaye Fragrance plans to raise a maximum of 113 million yuan through a simplified procedure for issuing shares to specific investors, with the funds primarily allocated for the first phase of a project to produce 1,300 tons of fragrance annually [1][4]. Group 1: Fundraising and Project Details - The total investment for the annual production of 3,230 tons of fragrance project is 140.63 million yuan, with 113 million yuan coming from the current fundraising [3]. - The pricing benchmark for the share issuance will be set at no less than 80% of the average stock price over the 20 trading days prior to the pricing date [2][3]. - The issuance will target no more than 35 specific investors, including qualified institutional investors and other eligible entities as per the regulations of the China Securities Regulatory Commission [4]. Group 2: Shareholder Structure and Control - As of the announcement date, the controlling shareholder, Huawen Liang, holds 28.19% of the company's total shares directly and an additional 4.56% indirectly, totaling 32.75% [5]. - The share issuance is not expected to change the company's control structure, as Huawen Liang will remain the controlling shareholder post-issuance [5]. Group 3: Financial Performance - In Q1 2025, Huaye Fragrance reported a revenue of 98 million yuan, a year-on-year increase of 24.06%, and a net profit attributable to shareholders of 11 million yuan, up 94.50% [6][7]. - The company has shown a significant improvement in net profit over the past four years, with total net profit for shareholders reaching 0.56 billion yuan from 2021 to 2024 [7]. - For the year 2024, the company reported a revenue of approximately 345 million yuan, a 28.12% increase from 2023, and a net profit of about 22 million yuan, marking a 659.83% increase [8].

Core Viewpoint - Anhui Huaye Fragrance Co., Ltd. plans to issue shares through a simplified procedure to specific targets, which may dilute immediate returns, and has proposed measures to compensate for this dilution [2][6][14]. Financial Impact Analysis - The company estimates that the total amount raised from this issuance will be 113 million yuan, with a maximum of 22.4394 million shares to be issued [3][4]. - The financial impact of the issuance on key indicators has been analyzed under three scenarios regarding net profit for 2025 compared to 2024: a 10% increase, no change, and a 10% decrease [4][5]. - Before the issuance, the total share capital is 74.798 million shares, which will increase to 97.2374 million shares post-issuance [4]. Scenarios for Financial Indicators - **Scenario 1**: If the net profit increases by 10%, the basic earnings per share (EPS) will rise from 0.30 yuan to 0.32 yuan [4]. - **Scenario 2**: If the net profit remains unchanged, the EPS will stay at 0.30 yuan [4]. - **Scenario 3**: If the net profit decreases by 10%, the EPS will drop to 0.27 yuan [4]. Necessity and Reasonableness of the Issuance - The fundraising project is closely aligned with the company's main business and complies with national industrial policies, aiming to enhance market competitiveness and achieve sustainable development [6][7]. - The new production capacity will help maintain the company's leading position in the fragrance industry [6][10]. Measures to Mitigate Dilution Impact - The company will implement strict management and usage protocols for the raised funds to ensure effective and safe utilization [11][12]. - The company plans to accelerate the construction of the fundraising projects to achieve expected benefits as soon as possible [12]. - A profit distribution system will be established to enhance investor return mechanisms, ensuring continuous and stable profit distribution [12][13]. Commitments from Key Stakeholders - The company's board and senior management have committed to ensuring the effectiveness of the measures to compensate for the dilution of immediate returns [13][14]. - The controlling shareholder has also made commitments to uphold the measures aimed at protecting shareholder interests [14].

Core Viewpoint - The report provides an overview of the fundraising and usage of funds by Anhui Huaye Fragrance Co., Ltd., confirming that the funds raised have been fully utilized as per the commitments made during the initial public offering [1][2][3]. Fundraising Overview - The company raised a total of RMB 266.77 million through the issuance of 14.35 million shares at a price of RMB 18.59 per share, with a net amount of RMB 222.62 million after deducting issuance costs [3][4]. - All raised funds were confirmed to be in place by September 10, 2020, as verified by an audit report [3]. Fund Usage and Balance - As of December 31, 2024, the company invested a total of RMB 227.64 million from the raised funds, with prior self-funding of RMB 113.76 million [3][4]. - The company has fully utilized the raised funds by the end of the reporting period [3][4]. Project Investment Details - The company committed to three projects: the annual production of 3,000 tons of butyrolactone series synthetic fragrances, the establishment of a fragrance engineering technology research center, and the marketing network construction project [4][5]. - Changes in project implementation locations and timelines were made, including the relocation of the research center and adjustments to the expected completion dates of various projects [5][6]. Financial Management of Idle Funds - The company has approved the use of idle funds for cash management, allowing up to RMB 80 million to be temporarily invested in safe and liquid financial products [6][7][8]. - As of December 31, 2024, the balance of cash management from idle funds was zero [9]. Project Performance and Benefits - The actual investment in the annual production of 3,000 tons of butyrolactone series synthetic fragrances exceeded the committed amount due to interest and investment income from the fundraising account [11]. - The project has not yet achieved the expected economic benefits, with the cumulative realized benefits falling below the promised returns by over 20% [12].