Securities code: Sailun Group Co.Ltd(601058) securities abbreviation: Sailun Group Co.Ltd(601058) Announcement No.: pro 2022034 Sailun Group Co.Ltd(601058)
Announcement on carrying out foreign exchange hedging business
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 the announcement, and bear individual and joint liabilities for the authenticity, accuracy and completeness of the contents.
On March 31, 2022, Sailun Group Co.Ltd(601058) (hereinafter referred to as "the company") held the 31st meeting of the 5th board of directors and the 23rd Meeting of the 5th board of supervisors, deliberated and adopted the proposal on developing foreign exchange hedging business, and agreed that the company and banks and other financial institutions should carry out foreign exchange hedging business of no more than 300 million yuan or equivalent foreign currency. The above matters are within the scope of the deliberation authority of the board of directors and do not need to be submitted to the general meeting of shareholders for deliberation. The details are as follows:
1、 Basic information of foreign exchange hedging business
1. Transaction types: forward settlement and sale of foreign exchange, foreign exchange options, etc.
2. Capital limit: within the term of validity, it shall not exceed 300 million yuan or equivalent foreign currency, and the above limit can be recycled and rolled.
3. Source of funds: self owned funds
4. Contract term: no more than one year
5. Term of validity: from the date of approval by the board of directors to the date when the company holds the board of directors to review the annual report of 2022.
6. Matters of authorization: within the scope and period of the above quota, the board of directors authorizes the executive vice president or his authorized agent to be responsible for the specific implementation of foreign exchange hedging business and sign relevant documents.
2、 Risk analysis of foreign exchange hedging business
The company's foreign exchange hedging business follows the principles of legality, prudence, safety and effectiveness, and does not engage in speculative and arbitrage trading operations. However, there are still certain risks in the operation of foreign exchange hedging business.
1. Market risk: the difference between the contract exchange rate and interest rate of foreign exchange hedging business and the actual exchange rate and interest rate on the maturity date will produce transaction profits and losses; During the duration of foreign exchange hedging business, revaluation profits and losses will occur in each accounting period, and the cumulative value of revaluation profits and losses to the maturity date is equal to transaction profits and losses.
2. Liquidity risk: the foreign exchange hedging business is based on the company's foreign exchange assets and liabilities and matches the actual foreign exchange revenue and expenditure, so as to ensure that there is sufficient funds for liquidation at the time of delivery, so as to reduce the demand for cash flow on the due date.
3. Performance risk: the counterparties of the company to carry out foreign exchange hedging business are banking and financial institutions with good credit and have established business relations with the company, and the performance risk is low.
4. Other risks: when conducting transactions, if the operators fail to operate the foreign exchange hedging business according to the specified procedures or fail to fully understand the derivatives information, operational risks will be brought; If the terms of the transaction contract are not clear, it may face legal risks.
3、 Risk control scheme
1. In order to control risks, the company has formulated the management system of foreign exchange hedging business, which clearly stipulates the management organization, approval authority, operation process and risk control of the company's foreign exchange hedging business. The company will operate in strict accordance with relevant regulations to ensure the effective implementation of the system and strictly control business risks.
2. The company carries out foreign exchange hedging business for the purpose of avoiding risks, and speculation and arbitrage transactions are prohibited.
3. In order to control the performance risk, the company only carries out foreign exchange hedging business with banks and other financial institutions with legal business qualification, so as to avoid the possible performance risk as far as possible.
4. In order to avoid the risk of sharp fluctuation of exchange rate, the company will strengthen the research and analysis of exchange rate, pay real-time attention to the changes of international market environment, and adjust strategies in time to avoid possible exchange losses to the greatest extent.
4、 Accounting principles for foreign exchange hedging business
The company will conduct corresponding accounting for foreign exchange hedging business in accordance with the relevant provisions and directions of accounting standards for Business Enterprises No. 22 - recognition and measurement of financial instruments, accounting standards for Business Enterprises No. 23 - transfer of financial assets, accounting standards for Business Enterprises No. 24 - hedge accounting and accounting standards for business enterprises No. 37 - presentation of financial instruments.
5、 Independent opinions of independent directors
After verification, the relevant decision-making procedures for the company to carry out foreign exchange hedging business this time comply with relevant national laws, regulations and the relevant provisions of the articles of association. Based on normal production and operation and relying on specific business operations, the company uses foreign exchange hedging tools to reduce exchange rate risks, reduce exchange losses and control business risks on the premise of ensuring normal production and operation, without damaging the interests of the company and all shareholders, especially small and medium-sized shareholders. The company's foreign exchange hedging business is feasible and the risk can be controlled. To sum up, all independent directors unanimously agree that the company shall carry out foreign exchange hedging business.
6、 Opinions of the board of supervisors
After verification, the company's foreign exchange hedging business on the premise of ensuring normal production and operation is conducive to avoiding and preventing the adverse impact of exchange rate fluctuations on the company's operation, controlling exchange rate risk, which is in line with the actual situation of the company, relevant decision-making procedures are in line with the provisions of relevant laws and regulations, and there is no damage to the interests of the company and all shareholders, especially small and medium-sized shareholders.
In conclusion, the board of supervisors approved the company to carry out foreign exchange hedging business.
7、 Documents for future reference
1. Resolution of the 31st meeting of the 5th board of directors of the company
2. Resolution of the 23rd Meeting of the 5th board of supervisors of the company
3. Independent opinions of the company's independent directors on matters related to the 31st meeting of the Fifth Board of directors
It is hereby announced.
Sailun Group Co.Ltd(601058) board of directors April 2, 2022
