Response to the Audit Inquiry Letter Regarding the Application of Nanjing Quanxin Transmission Technology Co., Ltd. for Issuance of Convertible Corporate Bonds to Unspecified Targets
Tianheng Zhuanzi (2026) No. 01400
Shenzhen Stock Exchange:
In accordance with the requirements of the "Audit Inquiry Letter Regarding the Application of Nanjing Quanxin Transmission Technology Co., Ltd. for Issuance of Convertible Corporate Bonds to Unspecified Targets" (Audit Letter [2026] No. 020036) (hereinafter referred to as the "Inquiry Letter") issued by your exchange on May 8, 2026, Tianheng Certified Public Accountants (LLP) (hereinafter referred to as the "Reporting Accountant"), acting as the reporting accountant for Nanjing Quanxin Transmission Technology Co., Ltd. (hereinafter referred to as the "Company" or "Issuer") in its application for the issuance of convertible corporate bonds to unspecified targets, has carefully implemented and addressed the relevant issues involving the reporting accountant in the Inquiry Letter. The response is as follows:
Explanation on the interpretation of content, format, and supplementary disclosure matters in this response:
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Unless otherwise specified, the abbreviations or terminology used in this response are consistent with the "Prospectus for the Issuance of Convertible Corporate Bonds to Unspecified Targets by Nanjing Quanxin Transmission Technology Co., Ltd." (hereinafter referred to as the "Prospectus").
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If the sum of the totals in this response does not match the sum of the listed figures, it is due to rounding.
Question 1
From 2023 to 2025, the Company's operating income was 1,036.5092 million yuan, 910.4237 million yuan, and 838.559 million yuan, respectively, and operating profit was 153.768 million yuan, 7.9006 million yuan, and 33.8867 million yuan, respectively, showing an overall decline in operating performance. During the reporting period, the Company's comprehensive gross profit margin was 39.68%, 31.99%, and 35.53%, respectively, and the net cash flow from operating activities was 135.5063 million yuan, -4.8432 million yuan, and 397.3598 million yuan, respectively.
According to the application materials, from 2023 to 2025, the proportion of operating income from the top five customers (calculated on a consolidated basis under the same control) was 90.81%, 83.64%, and 79.16%.
As of the end of 2023 to 2025, the book value of the Company's accounts receivable was 822.0308 million yuan, 914.306 million yuan, and 851.9473 million yuan, respectively. The proportion of accounts receivable within one year to the total accounts receivable was 81.45%, 66.15%, and 65.34%, respectively, and the accounts receivable turnover rate was 1.35 times, 0.97 times, and 0.86 times, respectively. The balance of notes receivable was 291.79 million yuan, 312.8522 million yuan, and 105.7463 million yuan, respectively, accounting for 13.02%, 15.76%, and 5.37% of current assets, mainly consisting of commercial acceptance bills used by large state-owned group companies or their subsidiaries in the military industry to pay for goods.
As of the end of 2023 to 2025, the book value of the Company's fixed assets was 398.2144 million yuan, 389.747 million yuan, and 370.832 million yuan, respectively, mainly including buildings, machinery and equipment, transportation equipment, and office and other equipment. From 2023 to 2025, the capacity utilization rate of the Company's cable products was 85.51%, 84.50%, and 59.47%, respectively. As of December 31, 2025, the book value of the Company's long-term equity investment was 13.5217 million yuan.