Core Viewpoint - The report details the fundraising activities and usage of funds by Lianhua Holdings Co., Ltd. for the first half of 2025, highlighting the total amount raised, the allocation of funds, and the management of these funds [1][2][3]. Fundraising Overview - The company raised a total of RMB 993,545,246.40 through a non-public offering of 413,977,186 shares at RMB 2.40 per share, with a net amount of RMB 976,158,204.59 after deducting underwriting fees [1]. - As of June 30, 2025, the balance of the raised funds was RMB 54,815.84 million, with RMB 34,815.84 million in the special account [3]. Fund Usage and Management - The company has used RMB 41,949.97 million of the raised funds cumulatively by the end of 2024, with no usage reported for the first half of 2025 [2][6]. - The company has temporarily used RMB 20,000.00 million of idle funds to supplement working capital, with the repayment period not exceeding 12 months [6][7]. Fund Management Practices - The company has established a management system for the raised funds, including a special account for storage and a tripartite supervision agreement with banks and the sponsor [3][4]. - No cash management or investment in related products was reported for idle funds during the reporting period [7][12]. Project Adjustments - The company has made adjustments to its fundraising projects, including the termination of the "Biological Fermentation Products Project" and the "Supporting Biological Fermentation Products Project" due to market conditions and strategic considerations [10][12]. - The "Wheat Flour Series Products Project" has been scaled down and concluded, reflecting a cautious approach to investment in light of increased competition and market saturation [10][11]. Compliance and Disclosure - The company has ensured compliance with relevant regulations regarding the use of raised funds and has committed to timely and accurate disclosures [9][12].

Core Viewpoint - Lianhua Holdings has announced a significant increase in net profit for the first half of 2025, projecting a year-on-year growth of over 50%, yet has not issued any dividends despite strong performance [1][2]. Group 1: Financial Performance - For the first half of 2025, Lianhua Holdings expects a net profit between 160 million to 170 million yuan, representing a year-on-year increase of 58.67% to 68.59% [2]. - The company achieved a net profit of 130 million yuan in 2023, marking a year-on-year growth of 181.26%, and 203 million yuan in 2024, with a growth of 55.92% [2]. - The revenue for 2023 was 2.101 billion yuan, up 24.23%, and for 2024, it was 2.646 billion yuan, an increase of 25.98% [2]. Group 2: Product Development and Strategy - The high growth in 2025 is attributed to the successful development and sales of new products, with several new offerings like Matsutake Fresh and Premium Brewed Soy Sauce seeing revenue growth exceeding 100% [2]. - Lianhua Holdings underwent significant strategic changes post-restructuring in 2019, focusing on governance, credit repair, strategic restructuring, and product innovation [3]. - The company launched a "Brand Revival Strategy" in 2022, emphasizing youthfulness, digitalization, internationalization, and innovation [3]. Group 3: Stock Performance - Following its restructuring, Lianhua Holdings' stock price has seen substantial growth, with a peak increase of over six times from its lowest point in 2019 [4]. - The stock price reached a high of 8.24 yuan in 2023, with a dynamic price-to-earnings ratio exceeding 160 times [4]. - As of July 11, 2025, the closing price was 6.23 yuan, with a dynamic P/E ratio of 43.94 times [4]. Group 4: Dividend Policy - Lianhua Holdings has only issued cash dividends once since its listing in 1998, in 2001, and has not distributed dividends since its restructuring in 2019 [6][7]. - The company's retained earnings have remained negative since 2010, with a deficit of 1.32 billion yuan in 2010 and worsening to 1.176 billion yuan by 2024 [6][7]. - The company's dividend policy stipulates that dividends can only be distributed if there are positive retained earnings, making short-term dividends unlikely [7].