Sinomine Resource Group Co.Ltd(002738)
Securities code: Sinomine Resource Group Co.Ltd(002738) securities abbreviation: Sinomine Resource Group Co.Ltd(002738) Announcement No.: 2022056 bond Code: 128111 bond abbreviation: China Mining convertible bond
Sinomine Resource Group Co.Ltd(002738)
Announcement on carrying out forward foreign exchange settlement and sales business
The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete without false records, misleading statements or major omissions.
Sinomine Resource Group Co.Ltd(002738) (hereinafter referred to as “the company” or “the company”) held the 21st Meeting of the 5th board of directors on May 18, 2022, deliberated and adopted the proposal on carrying out forward foreign exchange settlement and sales business. The company is approved to carry out forward foreign exchange settlement and sales business, and the total amount of forward foreign exchange settlement and sales business shall not exceed US $100 million.
The above matters do not involve related party transactions, nor do they constitute a major asset reorganization stipulated in the administrative measures for major asset reorganization of listed companies, and do not need to be submitted to the general meeting of shareholders of the company for deliberation. The details are as follows:
1、 Reasons and purposes of carrying out forward foreign exchange settlement and sales business
In order to further improve the company’s ability to deal with the risk of foreign exchange fluctuation, better avoid and prevent the risk of foreign exchange rate and interest rate fluctuation faced by the company, enhance the company’s financial stability, and prevent the adverse impact of large exchange rate fluctuation on the company’s cost control and operating performance, the company plans to carry out long-term foreign exchange settlement and sales business with banks under the condition of ensuring the daily working capital demand. The long-term settlement and sales of Foreign Exchange carried out by the company are aimed at locking costs, avoiding and preventing exchange rate risks, and will not affect the company’s main business.
2、 Amount and term of carrying out forward foreign exchange settlement and sales business
The total amount of the company’s long-term foreign exchange settlement and sales business shall not exceed US $100 million, and the transaction amount can be recycled and used within the above limit range and period. The board of directors of the company authorizes the management to carry out the long-term foreign exchange settlement and sales business according to the business conditions and actual needs within the scope and period of this quota. The authorization is valid from the date of deliberation and approval by the board of directors to the date of new authorization made by the board of directors on this matter.
The transaction currency of the company’s forward foreign exchange settlement and sales business is limited to US dollars. The delivery period of the transaction is basically consistent with the predicted payment period, collection period or repayment period, and the amount of the transaction matches the predicted payment period, collection period or repayment period. The counterparty is a bank approved by the State Administration of foreign exchange and the people’s Bank of China to operate foreign exchange derivatives business.
Sinomine Resource Group Co.Ltd(002738)
3、 Risk analysis of carrying out forward foreign exchange settlement and sales business and risk control measures taken by the company
1. Risk analysis
(1) Exchange rate fluctuation risk
When the foreign exchange rate fluctuates greatly, if the fluctuation direction of the exchange rate is inconsistent with the judgment of the company, resulting in the inconsistency between the exchange rate fluctuation and the direction of the forward foreign exchange settlement and sales contract, and the large deviation between the forward exchange rate agreed in the forward foreign exchange settlement and sales contract and the real-time exchange rate will cause exchange losses.
(2) Internal control risk
The forward foreign exchange settlement and sales business is highly professional and complex, which may cause risks due to the imperfect internal control mechanism.
(3) Collection and payment forecast risk
The company forecasts revenue and expenditure according to sales orders, purchase orders and foreign currency loan contracts. In the actual implementation process, customers or suppliers may adjust orders, and foreign currency loans may be repaid in advance or extended, resulting in inaccurate prediction of foreign currency revenue and expenditure and delivery risk.
2. Risk control measures taken by the company
(1) In order to avoid the operational risks brought to the company by the 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, timely adjust the operation strategy of long-term settlement and sales of foreign exchange, and avoid exchange losses to the greatest extent.
(2) In order to avoid exchange rate fluctuation and contract deviation of forward foreign exchange settlement and sales business, a more flexible forward foreign exchange settlement and sales business mode that can be delivered in advance or extended delivery is preferred.
(3) The company has formulated the management measures for long-term foreign exchange settlement and sales business, established a strict and effective risk management system, and used the risk control measures before, during and after the event to prevent, discover and reduce various risks. The system meets the relevant requirements of the regulatory authorities, meets the needs of practical operation, and the risk control measures formulated are practical and effective.
(4) In order to avoid internal control risks, the company’s financial management department, audit and supervision department, securities affairs department and legal risk control department, as relevant responsible departments, have clear management positioning and responsibilities. Through hierarchical management, a supervision mechanism is formed to eliminate the risk of single person or separate department operation from the system and effectively control the operational risk. (5) The company’s forward foreign exchange settlement and sales business must be based on the company’s foreign currency collection forecast under export and foreign currency payment forecast under import, or the company’s foreign currency bank loan stock. The foreign currency amount of the forward foreign exchange settlement and sales business contract shall not exceed the foreign currency collection or foreign currency payment forecast. The delivery period of the forward foreign exchange settlement and sales business shall be consistent with
Sinomine Resource Group Co.Ltd(002738) the foreign currency collection time or foreign currency payment time predicted by the company matches, or matches the repayment period of the corresponding foreign currency bank loan.
(6) The internal control of the company will regularly review the actual operation, capital use and profit and loss of the long-term foreign exchange settlement and sales business.
4、 Opinions of independent directors
The independent directors believe that since the company’s overseas procurement, overseas sales, overseas investment and foreign currency credit are mainly in US dollars as the transaction currency, the company’s forward foreign exchange settlement and sales business is to prevent the adverse impact of large exchange rate fluctuations on the company’s operation, for the purpose of locking costs, avoiding and preventing exchange rate risks, and will not affect the company’s main business. The company has formulated the management measures for long-term foreign exchange settlement and sales business, established a strict and effective risk management system, and used the risk control measures before, during and after the event to prevent, discover and reduce various risks. The company’s long-term foreign exchange settlement and sales business does not harm the interests of listed companies and shareholders. Therefore, all independent directors unanimously agreed to the company’s long-term foreign exchange settlement and sales business.
5、 Documents for future reference
1. Resolution of the 21st Meeting of the 5th board of directors of the company.
2. Resolution of the 17th meeting of the 5th board of supervisors of the company.
3. Independent opinions of independent directors on matters related to the 21st Meeting of the Fifth Board of directors of the company. 4. Sinomine Resource Group Co.Ltd(002738) forward foreign exchange settlement and sales management measures.
It is hereby announced.
Sinomine Resource Group Co.Ltd(002738) board of directors may 18, 2022
