Securities code: Houpu Clean Energy Co.Ltd(300471) securities abbreviation: Houpu Clean Energy Co.Ltd(300471) Announcement No.: 2022029 Houpu Clean Energy Co.Ltd(300471)
Special report on the company’s investment in foreign exchange derivatives in 2021
The company and all members of the board of directors guarantee that the contents of the announcement are true, accurate and complete without false records, misleading statements or major omissions.
The board of directors of Houpu Clean Energy Co.Ltd(300471) (hereinafter referred to as “the company”) checked the derivatives investment of the company in 2021 in accordance with the requirements of the self regulatory guidelines for listed companies on the Shenzhen Stock Exchange No. 2 – standardized operation of GEM listed companies and the self regulatory guidelines for listed companies on the Shenzhen Stock Exchange No. 1 – business handling, and the relevant information is described as follows:
1、 Review and approval of derivatives investment
The company held the 11th meeting of the 4th board of directors and the 10th meeting of the 4th board of supervisors on August 18, 2021
The proposal on carrying out foreign exchange derivatives trading business was deliberated and approved, and the company was agreed to use its own funds to carry out foreign exchange derivatives trading business with banks and other financial institutions not exceeding US $20 million or other equivalent currencies. The investment period is valid within 12 months from the date of deliberation and approval by the board of directors of the company, and the above amount can be recycled and used within the approval period.
2、 Details of foreign exchange derivatives investment in 2021
The company confirmed the profits and losses of derivatives investment during the reporting period, and there was no income from changes in fair value or investment income during the reporting period. The amount of derivatives transactions during the reporting period of the company was within the limit considered by the board of directors.
3、 Risk analysis of foreign exchange derivatives trading
The company follows the principles of legality, prudence, safety and effectiveness in carrying out foreign exchange derivatives trading, and does not carry out foreign exchange trading for the purpose of speculation. All foreign exchange derivatives trading businesses are based on normal production and operation, rely on specific business operations, and aim to avoid and prevent exchange gains and losses or foreign exchange interest rate risks caused by large changes in foreign exchange rates. It is not allowed to engage in complex foreign exchange derivatives transactions that exceed the actual needs of operation, It is not allowed to engage in foreign exchange derivatives speculation under the pretext of hedging. However, there are still the following risks in the trading operation of foreign exchange derivatives trading business:
1. Exchange rate fluctuation risk: in case of significant deviation between the trend of foreign exchange rate and the direction of exchange rate fluctuation judged by the company, the cost incurred by the company after locking the exchange rate may exceed the cost incurred when it is not locked, resulting in losses to the company.
2. Internal control risk: foreign exchange derivatives trading business is highly professional and complex, which may bring risks due to imperfect internal system.
3. Transaction default risk: if the counterparty of foreign exchange derivatives defaults and fails to pay the company’s derivatives profits as agreed, it will not be able to hedge the company’s actual exchange losses, which will cause losses to the company.
4、 Risk control measures to be taken
1. In order to avoid and guard against the risks caused by exchange rate fluctuations to the greatest extent, the relevant departments and personnel authorized by the company will pay close attention to and analyze the changes in the market environment and adjust the operation strategy in time.
2. The company will make clear provisions on the approval authority, business process, risk management system, reporting system and confidentiality system of foreign exchange derivatives trading business, which will effectively regulate the business behavior of foreign exchange derivatives trading.
3. The company only conducts transactions with financial institutions approved by the State Administration of foreign exchange and the people’s Bank of China and with corresponding business operation qualifications. The trading business of foreign exchange derivatives must be based on the careful prediction of the company’s foreign currency collection (payment). The delivery period of foreign exchange derivatives trading business must match the foreign currency collection and deposit time or foreign currency payment time predicted by the company, Or match the payment period of the corresponding foreign currency bank loan.
4. The Audit Department of the company is responsible for reviewing the actual operation, capital use and profit and loss of foreign exchange derivatives transactions.
5. The company has formulated the management system of foreign exchange derivatives trading business, which clearly stipulates the operation regulations, approval authority, management and internal operation process, information isolation measures, internal risk reporting system and risk handling procedures of foreign exchange derivatives trading business.
5、 Independent opinions of independent directors
After verification, the company did not make securities investment in 2021, but only carried out foreign exchange derivatives trading. The company has formulated the management system of foreign exchange derivatives trading business, which has been reviewed and approved by the board of directors. The relevant transactions have fulfilled the corresponding decision-making procedures, which can effectively regulate the trading behavior of derivatives and control the risk of derivatives trading. In addition, the company’s funds used for foreign exchange derivatives investment come from the company’s own funds for the purpose of avoiding and preventing the potential exchange rate risk caused by the company’s export business. There is no use of raised funds, no impact on the development of the company’s main business and no damage to the interests of the company and shareholders.
It is hereby announced.
Houpu Clean Energy Co.Ltd(300471) board of directors
March 24, 2022
