Securities code: 601606 securities abbreviation: Anhui Greatwall Military Industry Co.Ltd(601606) Announcement No.: 2021-070
Anhui Greatwall Military Industry Co.Ltd(601606)
Analysis on the impact of non-public offering on diluted spot return
And announcement of filling measures and commitments of relevant subjects
The company and all members of the board of directors guarantee that there are no false records, misleading statements or major omissions in the contents of this announcement, and bear individual and joint liabilities for the authenticity, accuracy and completeness of its contents.
Anhui Greatwall Military Industry Co.Ltd(601606) (hereinafter referred to as “the company”) held the second meeting of the Fourth Board of directors and the second meeting of the Fourth Board of supervisors on August 9, 2021. On December 31, 2021, the company held the fifth meeting of the Fourth Board of directors and the fifth meeting of the Fourth Board of supervisors, which deliberated and adopted relevant proposals on the company’s non-public offering of shares.
According to several opinions of the State Council on further promoting the healthy development of the capital market (GF [2014] No. 17), the opinions of the general office of the State Council on Further Strengthening the protection of the legitimate rights and interests of small and medium-sized investors in the capital market (GBF [2013] No. 110) and the guiding opinions on matters related to initial public offering, refinancing and dilution of immediate return for major asset restructuring (CSRC announcement [2015] No. 31), in order to protect the interests of small and medium-sized investors, the company has carefully analyzed the impact of this non-public offering on the dilution of immediate return, formulated specific measures to fill the diluted immediate return, and relevant subjects have made a commitment to the practical implementation of the company’s measures to fill the return. The details are as follows:
1、 Impact of diluted immediate return of this non-public offering on the company’s main financial indicators
1. It is assumed that there are no significant adverse changes in the macroeconomic environment and securities industry, and there are no significant adverse changes in the company’s business environment;
2. Assuming that the non-public offering is completed in May 2022, the completion time is only used to calculate the impact of the diluted spot return of the non-public offering on the main financial indicators, and the final time shall be subject to the actual completion time approved by the CSRC;
(number) fully raised, without considering the impact of deducting the issuance expenses, assuming that the expected number of shares to be issued this time does not exceed 108634260 shares (not exceeding 30% of the company’s total share capital of 724228400 shares before this non-public offering), The number of shares issued shall be subject to the number of shares approved by the CSRC (this assumption is only used to calculate the impact of this non-public offering on the company’s earnings per share, and does not represent the company’s judgment on the number of shares issued in this non-public offering. Finally, the number of shares issued approved by the CSRC shall prevail);
4. According to the 2020 annual report disclosed by the company, the net profit attributable to the shareholders of the parent company in 2020 is RMB 117.3314 million, and the net profit attributable to the shareholders of the parent company after deducting non recurring profits and losses is RMB 97.1698 million. On the premise of no major operational risk, it is assumed that the net profit of the company in 2021 and the net profit attributable to the shareholders of the parent company after deducting non recurring profits and losses are the same as that in 2020. The net profit attributable to the shareholders of the parent company and the net profit attributable to the shareholders of the parent company after deducting non recurring profits and losses realized by the company in 2022 are assumed and calculated according to the following three situations:
(1) Assuming that the net profit attributable to the shareholders of the parent company realized by the company in 2022 and the net profit attributable to the shareholders of the parent company after deducting non recurring profits and losses are 10% lower than that in 2021;
(2) It is assumed that the net profit attributable to the shareholders of the parent company realized by the company in 2022 and the net profit attributable to the shareholders of the parent company after deducting non recurring profits and losses are the same as that in 2021;
(3) It is assumed that the net profit attributable to the shareholders of the parent company in 2022 and the net profit attributable to the shareholders of the parent company after deducting non recurring profits and losses will increase by 10% compared with 2021.
The above assumptions are only used to calculate the diluted impact of this non-public offering on the main financial indicators of the company’s immediate return, do not represent the company’s judgment on the operation and trend in 2021 and 2022, and do not constitute the company’s profit forecast. Investors should not make investment decisions based on this. If investors make investment decisions based on this, the company will not be liable for compensation;
5. Based on the principle of prudence, the impact of the funds raised from this non-public offering on the company’s production, operation and financial status (such as operating income, financial expenses, investment income, etc.) is not considered;
6. It is assumed that there will be no impact on the company’s share capital before the issuance of shares and the transfer of capital reserve.
Based on the above assumptions, the company calculated the impact of this non-public offering on the company’s main financial indicators, as follows:
Project year 2021 year 2022 year
Before and after this offering
Total share capital at the end of the period (10000 shares) 72422.8472422.8483286.27
Scenario 1: the company’s net profit attributable to the shareholders of the parent company in 2022 and the net profit attributable to the owners of the parent company after deducting non recurring profits and losses decreased by 10% compared with that in 2021
Net profit attributable to shareholders of the parent company (RMB 117331410559.8210559.82)
Net profit attributable to shareholders of the parent company after deducting non recurring profits and losses of 9716.988745.288745.28 (RMB 10000)
Basic earnings per share (yuan / share) 0.16120.14580.1440
Diluted earnings per share (yuan / share) 0.16120.14580.1440
Basic earnings per share after deducting non recurring profits and losses of 0.13330.12080.1193 (yuan / share)
Diluted earnings per share of 0.13330.12080.1193 (yuan / share) after deducting non recurring profits and losses scenario 2: the company’s net profit attributable to shareholders of the parent company in 2022 and the net profit attributable to owners of the parent company after deducting non recurring profits and losses are the same as those in 2021
Net profit attributable to shareholders of the parent company (RMB 117331411733.1411733.14)
Net profit attributable to shareholders of the parent company after deducting non recurring profits and losses (RMB 10000)
Basic earnings per share (yuan / share) 0.16120.16200.1600
Diluted earnings per share (yuan / share) 0.16120.16200.1600
Basic earnings per share of 0.13330.13420.1325 after deducting non recurring profits and losses (yuan / share)
Diluted earnings per share of 0.13330.13420.1325 (yuan / share) after deducting non recurring profits and losses scenario 3: the company’s net profit attributable to shareholders of the parent company in 2022 and the net profit attributable to owners of the parent company after deducting non recurring profits and losses increased by 10% compared with 2021
Net profit attributable to shareholders of the parent company (RMB 117331412906.4512906.45)
Net profit attributable to shareholders of the parent company after deducting non recurring profits and losses of 97169810688.6810688.68 (RMB 10000)
Basic earnings per share (yuan / share) 0.16120.17820.1760
Diluted earnings per share (yuan / share) 0.16120.17820.1760
Basic earnings per share after deducting non recurring profits and losses of 0.13330.14760.1458 (yuan / share)
Diluted earnings per share after deducting non recurring profits and losses of 0.13330.14760.1458 yuan / share note: earnings per share shall be calculated in accordance with the provisions of rules for the preparation of information disclosure of companies offering securities to the public No. 9 – Calculation and disclosure of return on net assets and earnings per share (revised in 2010).
According to the above calculation, after the completion of this non-public offering, it is expected that the company’s basic earnings per share and diluted earnings per share may decline to a certain extent in the short term. Therefore, there is a risk that the company’s earnings per share in 2022 will be diluted.
2、 Risk tips for diluted immediate return of non-public offering of shares
After the completion of this non-public offering, with the funds raised in place, the total share capital of the company will increase. According to the above calculation, this issuance may lead to a decline in the company’s earnings per share in the year of issuance compared with that before the issuance, and there is a risk that the company’s immediate return in the year when the funds raised by non-public offering are in place will be diluted in the short term. Please invest rationally and pay attention to investment risks.
In addition, the company’s assumptions on the relevant financial data of 2021 and 2022 are only for the convenience of calculating the relevant financial indicators, do not represent the company’s judgment on the business situation and trend of 2021 and 2022, and do not constitute a profit forecast or profit commitment to the company; At the same time, the non-public offering still needs the approval of the CSRC, and there are uncertainties in whether, when and when to obtain the approval. Investors shall not make investment decisions based on the above assumptions. If investors make investment decisions based on these assumptions and cause losses, the company shall not be liable for compensation.
3、 Necessity and rationality of this non-public offering
This financing is in line with the development trend of the company’s industry and the company’s future development plan, which is conducive to improving the company’s capital strength and profitability. By further optimizing the capital structure, enhancing the company’s ability to resist operational risks, consolidating and strengthening the company’s industry status is in line with the interests of the company and all shareholders of the company. The necessity and rationality of the purpose of the raised funds in this offering are detailed in the feasibility analysis report of Anhui Greatwall Military Industry Co.Ltd(601606) non public development bank stock raised funds investment project (Revised Draft).
4、 The relationship between the investment project of the raised funds and the existing business of the company
The raised funds will be used for the production capacity construction project of high-energy guided ammunition, the production capacity construction project of low-cost self-seeking rocket, the production capacity construction project of new initiating explosive devices, the scientific research and production capacity construction project of new aviation submunitions, the development project of unmanned intelligent aircraft, the R & D conditions construction project of ultra-high strength prestressed anchorage system, and the special payables for repaying state allocated funds, The investment content of the raised funds is implemented around the company’s existing main business. 5、 The relationship between the non-public offering of shares and the company’s existing business, and the company’s reserves in terms of personnel, technology, market, etc. engaged in raising investment projects
(i) Personnel reserves of the company engaged in investment projects with raised funds
The company adheres to the strategy of strengthening the enterprise with talents and focuses on strengthening the construction of talent team. Continuously improve the mechanism of talent introduction, training and use, improve the performance appraisal mechanism of chief experts and discipline leaders, continue to strengthen the training of skilled talents, and fully mobilize the entrepreneurial enthusiasm of talent officers. The company has gathered a team of high-quality professionals in business management, product development, design and manufacturing. At present, the company has more than 600 technical and R & D personnel, including 4 experts enjoying special government allowance of the State Council and 3 experts enjoying special government allowance of Anhui Province.
（2） Technical reserves of the company’s investment projects with raised funds
The company has 5 national high-tech enterprises, 5 provincial enterprise technology centers, 2 provincial engineering technology research centers, 2 postdoctoral research workstations and 1 Equipment Technology Research Institute. The company actively promotes the construction of coordination and innovation system, scientific research management system and R & D and incentive system with universities and scientific research institutes, has successively established extensive multi-level industry university research cooperation relations with many well-known Chinese universities and scientific research institutions, and has conducted fruitful cooperation in key technology research, product development and talent training.
（3） Market reserves of the company’s investment projects with raised funds
The company is one of the important manufacturers of mortar shells, optoelectronic countermeasure ammunition, small and medium caliber rocket weapons, mechanical fuses, submunitions and initiating explosive devices. Various series of weapons and equipment developed by the company have been deeply integrated into China’s whole national defense system. The product customers include sea, land, air, rocket army and armed police. The company maintains good customer relationship and has obvious market first mover advantage.
6、 The measures taken by the company to fill the return
