Securities code: Xinjiang Daqo New Energy Co.Ltd(688303) securities abbreviation: Xinjiang Daqo New Energy Co.Ltd(688303) Announcement No.: 2022033 Xinjiang Daqo New Energy Co.Ltd(688303)
Announcement on 2021 profit distribution plan
The board of directors and all directors of the company guarantee that there are no false records, misleading statements or major omissions in the contents of the announcement, and bear legal responsibility for the authenticity, accuracy and integrity of the contents according to law.
Important content tips:
Distribution ratio per share: cash dividend of 0.6 yuan (including tax) per a share.
The profit distribution is based on the total share capital registered on the equity distribution registration date, and the specific date will be specified in the equity distribution implementation announcement.
If the total share capital of the company changes before the equity registration date of equity distribution, it is proposed to maintain the total distribution unchanged, adjust the distribution proportion per share accordingly, and make a separate announcement on the specific adjustment.
Brief explanation of the reason why the proportion of cash dividend in this year is lower than 30%: the company has fully considered the current operation status, industry development status and the future development direction of the company, and decided to use the retained undistributed profits for the working capital demand and project capital expenditure of the company’s R & D and daily operation, so as to provide a reliable guarantee for the company’s medium and long-term development strategy.
1、 Contents of profit distribution plan
Audited by Deloitte Touche Tohmatsu (special general partnership), as of December 31, 2021, Xinjiang Daqo New Energy Co.Ltd(688303) (hereinafter referred to as “the company”) had a profit available for distribution of RMB 758796942196 at the end of the period. According to the resolution of the board of directors, the company plans to distribute profits based on the total share capital registered on the date of equity distribution in 2021. The profit distribution plan is as follows:
The listed company plans to distribute a cash dividend of 6 yuan (including tax) for every 10 shares to all shareholders. As of the date of the meeting of the board of directors to review the profit distribution plan, the total share capital of the company is 1925000000 shares. Based on this calculation, the total cash dividend to be distributed is 115500000000 yuan (including tax). The cash dividend ratio of the company this year was 20.18%. If the total share capital of the company changes from the date of disclosure of this announcement to the date of equity distribution and equity registration, the company plans to maintain the total distribution unchanged and adjust the distribution proportion per share accordingly. In case of subsequent changes in the total share capital, the specific adjustment will be announced separately
This profit distribution plan needs to be submitted to the 2021 annual general meeting of shareholders of the company for deliberation.
2、 Description of cash dividend ratio less than 30% in this year
During the reporting period, the profit of the listed company was 572330651233 yuan, the accumulated undistributed profit of the parent company was 758796942196 yuan, and the total cash dividend to be distributed by the listed company was 115500000000 yuan, accounting for less than 30% of the net profit attributable to the shareholders of the listed company this year. The specific reasons are described below. (I) industry situation and characteristics of listed companies
The industry of the company is Cecep Solar Energy Co.Ltd(000591) photovoltaic industry. The core product of the company is Cecep Solar Energy Co.Ltd(000591) grade high-purity polysilicon, which is at the upstream of the industry and belongs to a capital and technology intensive industry. Affected by the goal of “carbon peak and carbon neutralization”, China’s photovoltaic market will enter a stage of rapid development during the 14th Five Year Plan period, and the industry will usher in the peak of market-oriented construction. Driven by the continuous photovoltaic industry policy, China’s polysilicon industry shows a trend of rapid development, and the market share will be further concentrated in enterprises with high technical level, obvious cost advantage and prominent economies of scale. The company needs sustained and high R & D investment and capital expenditure as support for the sustainable development of enterprises.
(II) development stage and business model of listed companies
Since its establishment in 2011, the company has been focusing on the R & D, production and sales of high-purity polysilicon closely around the national new energy strategic plan, relying on continuous R & D investment and technological innovation, combined with the advantages of low-cost energy and the cluster advantages of silicon industrial base. After ten years of exploration and development, the company has formed a high-purity polysilicon production capacity with an annual output of 105000 tons of high quality, low energy consumption and low cost. It is one of the main market participants in the polysilicon industry.
At present, the company is in the stage of rapid development. It will adhere to the overall strategy of focusing on photovoltaic silicon materials as its core business, take production capacity, cost and quality as the three main starting points, strengthen the company’s core competitiveness and improve the market share of photovoltaic silicon materials, and implement the construction of the raised investment project “1000 ton high-purity semiconductor material project” as soon as possible. On this basis, according to the Baotou Municipal People’s government and Xinjiang Daqo New Energy Co.Ltd(688303) strategic cooperation framework agreement signed between the company and Baotou municipal government, the company plans to moderately enter the upstream industrial silicon industry, gradually achieve a high proportion of self-sufficiency in raw materials, improve the company’s comprehensive profitability, and realize the supply safety and quality assurance of raw materials. Under appropriate conditions, the company will also consider expanding its business to silicone and other fields to build a leading upstream and downstream silicon material manufacturing enterprise with photovoltaic silicon material as the core. Therefore, in order to maintain core competitiveness and market coverage, the company needs to maintain sustained and high investment in R & D, operation and project construction. (III) profitability and capital demand of listed companies
In 2021, the company achieved an operating revenue of 10831866700 yuan, a year-on-year increase of 132.23%; The net profit attributable to the shareholders of the listed company was 5723842400 yuan, a year-on-year increase of 448.56%. During the reporting period, the company achieved higher profit scale and profit growth, and its financial situation improved, but its capital demand was still high. Combined with the characteristics of the company’s current industry, the company’s development stage and its own business model, the company must retain sufficient funds to meet the needs of R & D investment, business development and working capital, and fully ensure the stable operation and healthy development of the company.
(IV) reasons for the low level of cash dividends of the company, the exact purpose of retained undistributed profits and expected income
The retained undistributed profits of the company at the end of 2021 will be accumulated and accumulated to the next year, which will be used for the working capital needs of the company’s R & D and daily operation and project capital expenditure, so as to provide a reliable guarantee for the company’s medium and long-term development strategy. The relevant income level is affected by the macroeconomic situation, changes in asset quality, asset interest rate and other factors.
In the future, the company will always pay attention to the return of investors in the form of cash dividends, in strict accordance with relevant laws and regulations and the articles of association, comprehensively consider various factors related to profit distribution, actively implement the company’s profit distribution policy, share the achievements of the company’s development with investors, and better safeguard the long-term interests of all shareholders.
3、 Decision making procedures performed by the company
(I) convening, deliberation and voting of the board meeting
The company held the 22nd Meeting of the second board of directors on March 15, 2022, deliberated and passed the proposal on the company’s 2021 annual profit distribution plan, agreed to the profit distribution plan, and agreed to submit the proposal to the company’s 2021 annual general meeting for deliberation.
(II) opinions of independent directors
The company’s 2021 profit distribution plan complies with the provisions of relevant laws, regulations, normative documents and company systems, such as the guidelines for self discipline supervision of companies listed on the science and Innovation Board of Shanghai Stock Exchange No. 1 – standardized operation, the guidelines for supervision of listed companies No. 3 – cash dividends of listed companies, the articles of association and so on; This profit distribution plan comprehensively considers the company’s industry characteristics, development stage, its own business model, profitability and future development fund demand, which is in line with the current actual situation of the company, takes into account the interests of the company and all shareholders, and is conducive to the sustainable, stable and healthy development of the company. Therefore, we agree to the relevant matters of the company’s profit distribution plan for 2021 and agree to submit the proposal to the general meeting of shareholders for deliberation.
(III) opinions of the board of supervisors
The company held the 15th meeting of the second session of the board of supervisors on March 15, 2021, deliberated and adopted the proposal on the company’s profit distribution plan for 2021. The board of supervisors considered that the decision-making procedure of the company’s profit distribution plan for 2021, the form and proportion of profit distribution comply with the provisions of relevant laws and regulations and the articles of Association; The profit distribution plan fully considers various factors such as the company’s profitability, cash flow status and capital demand. There is no damage to the interests of minority shareholders, which is in line with the current operation situation of the company and conducive to the sustainable, stable and healthy development of the company. The board of supervisors approved the profit distribution plan and agreed to submit the proposal to the 2021 annual general meeting of shareholders of the company for deliberation.
4、 Relevant risk tips
1. This profit distribution plan combines the company’s profitability, future capital demand and other factors, and will not cause the company’s shortage of working capital, have a significant impact on the company’s operating cash flow, and affect the company’s normal operation and long-term development.
2. The company’s 2021 profit distribution plan needs to be submitted to the company’s 2021 annual general meeting for deliberation and approval. Please pay attention to investment risks.
It is hereby announced.
Xinjiang Daqo New Energy Co.Ltd(688303) board of directors March 16, 2022
