Core Viewpoint - Suzhou Hesheng New Materials Co., Ltd. (禾盛新材) announced that its director, Wu Haifeng, is under investigation for allegedly issuing illegal loans, but this matter is personal and does not affect the company's operations or control [1][3]. Group 1: Company Announcement - The company received a detention notice from the Public Security Bureau of Zhanjiang City regarding Wu Haifeng's investigation [1]. - The board of directors confirmed that the investigation is related to Wu Haifeng personally and does not impact the company's daily operations or control [3]. - The board's operations remain normal, and production activities are unaffected [3]. Group 2: Director Background - Wu Haifeng has held various positions, including Vice General Manager of the Credit Management Department at China Industrial Bank's Zhanjiang Branch and President of Ningxia Shunyi Asset Management Co., Ltd. [3]. - He has been serving as a director of Hesheng New Materials since April 2024, without receiving any salary or holding shares in the company [3]. Group 3: Company Business - Hesheng New Materials specializes in the research, production, and sales of appearance composite materials for home appliances [4].

Core Viewpoint - He Sheng New Materials announced that the recent matters concerning director Wu Haifeng are personal and unrelated to the company, with no changes in control or operations of the board, and normal production and operations are maintained [2] Group 1: Company Operations - As of June 30, 2025, He Sheng New Materials has four production lines for PCM/VCM, one intelligent composite materials production line, and one 3D printing production line [2] - The company specializes in the research, production, and sales of appearance composite materials for home appliances, achieving a high market share among major domestic and international home appliance brands [2] Group 2: Shareholding Plans - Wu Haifeng plans to increase his shareholding in the company by investing between RMB 10 million and RMB 20 million within six months from the announcement date, using personal or raised funds through the Shenzhen Stock Exchange [4] - As of the announcement date, Wu Haifeng did not hold any shares in the company and had not disclosed any shareholding increase plans in the previous 12 months [4]

Profitability Improvement - The company reported significant profit growth in its 2025 mid-year report, with total revenue of 1.211 billion yuan, a year-on-year increase of 0.32% [1] - The net profit attributable to shareholders reached 97.03 million yuan, up 58.31% year-on-year, while the net profit excluding non-recurring items was 97.10 million yuan, an increase of 57.40% [1] - In the second quarter, despite a year-on-year decline in total revenue by 11.27%, the net profit attributable to shareholders and net profit excluding non-recurring items increased by 37.93% and 38.15% respectively [1] - The company's gross margin and net margin were 15.66% and 7.85%, reflecting year-on-year increases of 48.69% and 56.43% respectively, indicating significant progress in cost control and profitability [1] Cash Flow and Accounts Receivable - The operating cash flow per share was 0.27 yuan, a year-on-year decrease of 12.22% [2] - Accounts receivable amounted to 469 million yuan, representing a high ratio of 479.37% to net profit attributable to shareholders, indicating pressure in accounts receivable management [2] Asset and Liability Situation - The company's cash and cash equivalents were 494 million yuan, a year-on-year increase of 43.30%, indicating a healthy cash position [3] - The ratio of cash and cash equivalents to current liabilities was only 69.66%, suggesting a need for further attention to short-term debt repayment capacity [3] - Interest-bearing debt decreased by 26.31% year-on-year to 183 million yuan, reflecting positive debt management efforts [3] Main Business Analysis - The company's main business involves the research, production, and sales of exterior composite materials for home appliances, with revenue from this segment reaching 1.186 billion yuan, accounting for 97.87% of total revenue [4] - The gross margin for home appliance composite materials was 15.03%, while other business revenue was 24.04 million yuan with a gross margin of 40.43% [4] - The company's products are widely used by well-known domestic and international home appliance brands, indicating a high market share [4] Development Prospects - The growth rate of the Chinese home appliance market is gradually slowing, transitioning to a structural upgrade phase focused on product iteration [5] - As one of the larger manufacturers of exterior composite materials for home appliances in China, the company has established long-term stable partnerships with several well-known domestic and international brands [5] - The company plans to leverage national "dual carbon" strategies and "old-for-new" appliance policies to enhance R&D efforts, increase product added value, optimize resource allocation, and improve overall competitiveness in the industry [5]