Securities abbreviation: Muyuan Foods Co.Ltd(002714) securities code: 002714 listing place: Shenzhen Stock Exchange Muyuan Foods Co.Ltd(002714)
2021 non-public shares
Feasibility analysis report on the use of raised funds
(Revised Version)
February, 2002
In order to enhance the company’s core competitiveness and enhance the company’s profitability, Muyuan Foods Co.Ltd(002714) (hereinafter referred to as “the company”) plans to raise funds by non-public offering of A-Shares (hereinafter referred to as “this offering”, “this non-public offering” and “this non-public offering”). The feasibility analysis of the company’s board of directors on the use of the funds raised in this non-public offering is as follows: I. The use plan of the funds raised in this non-public offering
The total amount of funds raised in this non-public offering is not less than 500 million yuan (including this amount) and not more than 600 million yuan (including this amount). The company plans to use all of them to supplement working capital after deducting the issuance expenses. The details are as follows:
No. total investment of the project (10000 yuan) amount of funds to be raised (10000 yuan)
1. Supplementary working capital 645000.00 600000.00
Total 645000.00 600000.00
Note: the amount of raised funds to be invested has been deducted, and the new investment and financial investment to be invested from six months before the resolution date of the board of directors of the company to the issuance shall not exceed 450 million yuan 1; The amount of raised funds to be invested in the table is temporarily calculated based on the upper limit. 2、 Necessity and feasibility of raising funds in this non-public offering (I) necessity of raising funds in this offering
1. Optimize financial structure and reduce financial risks
At the end of 2018, 2019, 2020 and September 2021, the company’s asset liability ratio was 54.07%, 40.04%, 46.09% and 57.77% respectively. With the continuous investment in capacity expansion and the gradual growth of business scale, the company’s asset liability ratio has shown a certain upward trend since 2019. The funds raised through this non-public offering of shares are used to supplement working capital, which will effectively improve the company’s asset liability structure, enhance financial stability and prevent financial risks. At the same time, the net assets of the company will be greatly improved and the asset structure will be more stable, which is conducive to improving the company’s anti risk ability, improving the company’s solvency and subsequent financing ability, and ensuring the sustainable, stable and healthy development of the company.
2. Enhance the company’s strength and meet the needs of future business development
From January to September in 2018, 2019, 2020 and 2021, the company achieved a total operating income of 133.881. The proposal on joint venture establishment of financial company and related party transactions with Muyuan Industrial Group Co., Ltd. was deliberated and adopted at the 32nd meeting of the third board of directors held on December 8, 2020. The company and muyuan group plan to jointly invest and establish a financial company. The registered capital of the finance company is 1 billion yuan, which is invested in cash by muyuan group and the company as sponsors, of which 450 million yuan is invested by the company. As of the announcement date of this plan, the matter is still under preparation and application
The net profits attributable to shareholders of listed companies were 520 million yuan, 6.114 billion yuan, 27.451 billion yuan and 8.704 billion yuan. By the end of September 2021, the total assets of the company were 169.205 billion yuan, and the net assets attributable to shareholders of listed companies were 56.199 billion yuan. With the expansion of business scale, the capital expenditure and working capital required for the normal operation and sustainable development of the company will increase rapidly. In addition to the investment in fixed assets such as breeding project construction, a large amount of working capital is also required to ensure important daily production and operation activities such as raw grain procurement. Replenishing working capital will help to improve the company’s comprehensive operating strength and enhance the company’s market competitiveness. (II) feasibility of using the raised funds
1. The use of the funds raised in this non-public offering complies with the provisions of laws and regulations
The use of the funds raised by the company’s non-public offering complies with relevant policies, laws and regulations and is feasible. After the funds raised from this non-public offering are in place, on the one hand, it will help the company reduce the asset liability ratio, reduce financial risks, improve the company’s capital structure, improve the profitability and promote the sustainable and healthy development of the company’s business; On the one hand, the expansion of the company’s operating capital will meet the needs of all shareholders and further enhance the company’s operating capital. On the other hand, it will further enhance the company’s competitiveness and enhance the company’s comprehensive operating capital.
2. The company has established perfect governance norms and internal control system for the use of raised funds
According to the governance standards of listed companies, the company has established a modern enterprise system with the corporate governance structure as the core, and formed a standardized and standard corporate governance system and perfect internal control procedures through continuous improvement and perfection. In terms of the management of raised funds, the company also established the management system of raised funds in accordance with the regulatory requirements, and made clear provisions on the storage, use and management of raised funds to ensure the standardized, safe and efficient use of raised funds. After the funds raised from this non-public offering are in place, the company will deposit the raised funds in the special account designated by the board of directors in accordance with the relevant system requirements, and the special account will be used for special purpose, so as to ensure the reasonable and standardized use of the raised funds and prevent the use risk of the raised funds. 3、 The impact of this non-public offering on the company’s operation and management and financial situation (I) the impact of this non-public offering on the company’s operation and management
The raised funds are used to supplement working capital, which will help optimize the company’s capital structure, improve the company’s anti risk ability, improve the company’s business scale and capital strength, improve the company’s market competitiveness, improve the company’s overall profitability and sustainable operation ability, and promote the company to enter a new stage of development. (II) impact of this non-public offering on the company’s financial position
After this issuance, the total assets and net assets of the company will increase at the same time, the proportion of current assets, especially monetary funds, will increase, and the asset liability ratio will decrease, which is conducive to optimizing the company’s capital structure, reducing the company’s financial costs and financial risks, improving the company’s solvency and subsequent financing ability, and enhancing the company’s sustainable operation ability.
After the implementation of this non-public offering, it will further improve the asset quality of the company, enhance the core competitiveness of the company, and promote the sustainable and healthy development of the company, which is in line with the interests of the company and all shareholders. 4、 Feasibility conclusion of this non-public offering
To sum up, after careful analysis and demonstration, the board of directors of the company believes that the use plan of the funds raised by this non-public offering is necessary and feasible in line with relevant policies, laws and regulations and the overall strategic development plan of the company in the future. The availability and use of the raised funds will help to improve the profitability and overall competitiveness of the company, enhance the sustainable development ability and anti risk ability of the company, and provide important support and guarantee for the subsequent development of the company. Therefore, the use of the funds raised in this non-public offering is reasonable and in line with the interests of the company and all shareholders.
Muyuan Foods Co.Ltd(002714) board of directors
February 26, 2022
