Securities Code: 002366 Securities Abbreviation: Rongfa Nuclear Power Announcement No.: 2026-018 Rongfa Nuclear Power Equipment Co., Ltd. Announcement on Accrual of Asset Impairment Provisions for 2025 The Company and all members of the Board of Directors guarantee the truthfulness, accuracy, and completeness of the information disclosed, without false records, misleading statements, or material omissions. Rongfa Nuclear Power Equipment Co., Ltd. (hereinafter referred to as the "Company") held the third meeting of the seventh Board of Directors on April 23, 2026, and reviewed and approved the "Proposal on Accrual of Asset Impairment Provisions for 2025". This accrual of asset impairment provisions needs to be submitted to the shareholders' meeting for review. The specific details are as follows: I. Overview of Accrual of Asset Impairment Provisions for 2025 In accordance with the "Accounting Standards for Business Enterprises", the "Code of Corporate Governance for Listed Companies" issued by the Shenzhen Stock Exchange, and other relevant regulations, based on the principle of prudence, to more truthfully and accurately reflect the Company's asset status and financial status as of December 31, 2025, and the Company's operating results for 2025, the Company and its subsidiaries conducted impairment tests on assets such as fixed assets, contract assets, inventory, and accounts receivable as of December 31, 2025, and determined that there were signs of possible impairment. After testing, the Company's asset impairment loss for 2025 was RMB 31,580,994.98, and the credit impairment loss was RMB 12,201,437.77, which were included in the Company's 2025 profit and loss, reducing the total profit of the Company in 2025 by RMB 43,782,432.75. The specific amounts are as follows:
- Asset Impairment Loss | Project | Amount Accrued in Current Period (RMB) | | :-------------------------- | :----------------------------------- | | Inventory Falling Price Loss | 66,674,754.48 | | Contract Asset Impairment Loss | -35,093,759.50 | | Total | 31,580,994.98 |
- Credit Impairment Loss | Project | Amount Accrued in Current Period (RMB) | | :---------------------------- | :----------------------------------- | | Notes Receivable Bad Debt Loss | 1,143,797.99 | | Accounts Receivable Bad Debt Loss | 2,682,896.14 | | Other Accounts Receivable Bad Debt Loss | 8,374,743.64 | | Total | 12,201,437.77 | II. Specific Explanation of Accrual of Asset Impairment Provisions for 2025
- Inventory Falling Price Provisions (1) Details of Inventory Impairment Provisions The Company accrued inventory falling price provisions totaling RMB 66,674,754.48 for 2025, with specific details as follows: | Project | Amount Accrued in Current Period (RMB) | | :-------------- | :----------------------------------- | | Work in Progress | 54,406,422.61 | | Inventory | -1,154,392.90 | | Goods Delivered | 13,422,724.77 | | Total | 66,674,754.48 | (2) Basis and Reasons for Accrual of Inventory Provisions At the balance sheet date, inventory is measured at the lower of cost and net realizable value. For inventory where the cost is higher than the net realizable value, an inventory falling price provision is accrued and included in current period profit or loss. If the factors that previously caused the inventory falling price provision have disappeared, making the net realizable value of the inventory higher than its book value, the previously reduced amount will be recovered within the scope of the previously accrued inventory falling price provision, and the recovered amount will be included in current period profit or loss. For inventory directly for sale, such as work in progress, inventory, and materials for sale, the net realizable value is determined by deducting estimated selling expenses and related taxes and fees from the estimated selling price of the inventory. For inventory held for production, the net realizable value is determined by deducting the estimated costs to completion, estimated selling expenses, and related taxes and fees from the estimated selling price of the finished product to be produc