Securities code: Keeson Technology Corporation Limited(603610) securities abbreviation: Keeson Technology Corporation Limited(603610) Announcement No.: 2022012 Keeson Technology Corporation Limited(603610)
Announcement on the company’s long-term foreign exchange settlement and sales business in 2022
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 this announcement, and bear individual and joint liabilities for the authenticity, accuracy and completeness of its contents.
Keeson Technology Corporation Limited(603610) (hereinafter referred to as “the company”) held the 23rd Meeting of the second board of directors and the 13th meeting of the second board of supervisors respectively on April 15, 2022, deliberated and adopted the proposal on the company and its subsidiaries to carry out long-term foreign exchange settlement and sales business in 2022, which needs to be submitted to the 2021 annual general meeting for deliberation. The relevant matters are hereby announced as follows:
1、 Purpose of carrying out forward foreign exchange settlement and sales business
At present, the company’s sales include domestic sales and overseas sales. The company’s foreign exchange receipts and payments for overseas sales are large, and the fluctuation of foreign exchange rate may have an impact on the company’s operating results. In order to reduce the risks caused by exchange rate fluctuations, the company and its subsidiaries carry out forward foreign exchange settlement and sales business and use the hedging function of forward foreign exchange settlement and sales to reduce the impact of exchange rate fluctuations on the company’s operating performance.
2、 Overview of forward foreign exchange settlement and sales business
The long-term foreign exchange settlement and sales business carried out by the company and its subsidiaries is closely related to daily operation, relying on real import and export business and aiming at avoiding and preventing exchange rate risk. Forward settlement and sales of foreign exchange is a foreign exchange hedging financial product approved by the people’s Bank of China. It is to negotiate and sign a forward settlement and sales agreement with the customer through the designated foreign exchange bank to agree on the foreign currency currency, amount, exchange rate and time limit for the settlement or sales of foreign exchange in the future. When it expires, the settlement and sales of foreign exchange will be handled in accordance with the agreement. The forward settlement and sale of foreign exchange transfers the time structure of the exchange rate from the future to the present, and the exchange rate for the bank to handle the settlement or sale of foreign exchange on a certain day in the future is agreed in advance, so as to lock in the cost of settlement and sale of foreign exchange in the current period.
3、 Expected amount of forward foreign exchange settlement and sales business and authorization period
According to the actual business development needs of the company, the company and its subsidiaries expect that the cumulative amount of forward foreign exchange settlement and sales business to be carried out in 2022 will not exceed US $500 million or equivalent currency. Authorize the general manager of the company and his authorized personnel to sign relevant contracts or documents within the limit. The authorization period is from the date of deliberation and approval of the company’s 2021 annual general meeting to the date of holding the 2022 annual general meeting.
4、 Risk analysis and control measures of long-term settlement and sale of foreign exchange
(I) risk analysis
1. Exchange rate fluctuation risk: when the exchange rate changes greatly, the bank’s forward exchange rate quotation for settlement and sale of foreign exchange may deviate from the exchange rate at the time of actual receipt and payment of the company, resulting in exchange losses of the company.
2. Customer default risk: the customer’s accounts receivable are overdue, and the payment for goods cannot be recovered within the predicted collection period, which will cause the delayed delivery of forward foreign exchange settlement and sales, resulting in losses to the company.
3. Collection forecast risk: the company’s business department forecasts the collection according to the customer’s orders and expected orders. In the actual implementation process, the customers may adjust their orders and forecasts, resulting in inaccurate collection forecast of the company, resulting in the risk of delayed delivery of forward foreign exchange settlement and sales.
(II) risk control measures
1. In order to prevent the delayed delivery of forward settlement and sales of foreign exchange, the company attaches great importance to the risk control of accounts receivable, timely grasp the information of customers’ payment ability, strive to improve the accuracy of collection prediction, strengthen the tracking and collection of accounts receivable, and try to minimize the risk.
2. When signing the forward foreign exchange settlement and sales business contract, the transaction shall be carried out in strict accordance with the period and amount of foreign exchange collection and payment predicted by the company. All forward foreign exchange settlement and sales businesses have real transaction background.
3. The above businesses are only allowed to trade with financial institutions with legal business qualifications, and shall not trade with informal institutions.
5、 Feasibility analysis of forward foreign exchange settlement and sales business
The company and its subsidiaries carry out forward foreign exchange settlement and sales on the basis of normal production and operation, on the principle of soundness, for the purpose of currency preservation and avoiding exchange rate risk, do not do speculative transactions without actual demand, do not carry out foreign exchange transactions solely for the purpose of profit, and avoid unpredictable risks caused by large fluctuations of exchange rate by locking the exchange rate.
It is hereby announced.
Keeson Technology Corporation Limited(603610) board of directors April 18, 2022
