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On July 26, Shanzi Hi-Tech (000981), which had fallen by the daily limit for four consecutive days, saw a strong rebound in its share price. As of the close of Friday, the share price closed at 0.86 yuan per share, and the risk of delisting at par value loomed. In the evening, the "self-rescue" actions of repurchase and increase in holdings were carried out simultaneously.

Yesterday, behind Shanzi Hi-Tech's strong rise was the company's large-scale repurchase plan.On July 25, the company's board of directors reviewed and approved the "Proposal on the Repurchase of the Company's Shares", with the repurchase amount not less than 600 million yuan and not more than 1 billion yuan (both inclusive). The repurchase price is not more than 1.6 yuan per share (inclusive).

The repurchase funds are self-owned funds or self-raised funds; the purpose of the repurchase is to further improve the company's long-term incentive mechanism, fully mobilize the enthusiasm of the company's core and backbone personnel, effectively combine the interests of shareholders, the company's interests and the personal interests of the core team, and promote the long-term development of the company. The company plans to repurchase part of the company's shares for use as an employee stock ownership plan or equity incentive plan.

As of March 31, 2024 (unaudited), Shanzi Hi-Tech's total assets were RMB 15.009 billion, the net assets attributable to shareholders of the listed company were RMB 3.393 billion, and cash and cash equivalents were RMB 1.051 billion.

Shanzi Hi-Tech said that based on the company's current operating and financial conditions, the company's vehicle business is progressing smoothly, and the revenue from commercial vehicle and passenger vehicle businesses is gradually increasing. This repurchase will not have a significant impact on the company's operations, finances and future development.

In addition to the repurchase, on July 26, Shanzi Hi-Tech also received a notice from the company's chairman and president Ye Ji that he planned to increase his holdings in the company's shares. Based on his confidence in the company's business development and recognition of the company's long-term investment value, Ye Ji plans to increase his holdings in the company's shares through the secondary market within six months from July 29, 2024 with his own or self-raised funds.

According to the content of the increase in holdings, Ye Ji and the companies he controlled increased their holdings by 10 million shares this time, and no upper limit on the increase in holdings price was set.

Shanzi Hi-Tech, formerly known as "Yinyi Shares", is mainly engaged in auto parts, real estate development, property management, etc. Among them, auto parts are the main revenue source of the company, accounting for more than 60% of the revenue last year, real estate sales accounted for 17%, and property management accounted for 15%.

In recent years, Shanzi Hi-Tech has been losing money year after year. Financial report data shows that in the past five years (2019-2023), the company's net profit was -7.131 billion yuan, -1.087 billion yuan, -2.614 billion yuan, -969 million yuan, and -2.057 billion yuan respectively.

The performance forecast shows that Shanzi Hi-Tech expects to lose 600 million to 800 million yuan in the first half of 2024; the loss after deducting non-operating items is 350 million to 500 million yuan.

"The company suffered some losses due to the large initial investment in important projects, the optimization of the European business of the automotive powertrain segment, and the high financial expenses." Shanzi Hi-Tech said in its performance forecast that during the reporting period, the company completed the industrial and commercial changes of the company involved in the above business through the public listing of the transfer of real estate business. According to relevant agreements and contracts, the company settled the transitional period profit and loss and capital transactions, and it is expected that this divestiture will bring the company a non-recurring loss of 700 million to 800 million yuan.

However, Shanzi Hi-Tech's losses during the reporting period were significantly reduced compared with the same period last year, mainly because the automotive powertrain segment actively implemented cost reduction and efficiency improvement measures, optimized the organizational structure, and effectively reduced costs and expenses. The automotive airbag gas generator segment improved its capacity utilization and production and operation efficiency by closing overseas factories, optimizing product structure, and transferring production lines to domestic factories. During the reporting period, this business turned losses into profits.

Editor: Peng Bo

Proofreader: Peng Qihua