Response of Grant Thornton (Special General Partnership) to the Audit Inquiry Letter Regarding the Application for Issuance of Shares to Specific Targets by Fujian Ashine New Material Technology Co., Ltd.
Grant Thornton Letter [2026] No. 351A006258
To: Shenzhen Stock Exchange
Fujian Ashine New Material Technology Co., Ltd. (hereinafter referred to as the "Company," "Issuer," or "Ashine") received the "Audit Inquiry Letter Regarding the Application for Issuance of Shares to Specific Targets by Fujian Ashine New Material Technology Co., Ltd." (Audit Letter [2026] No. 020035) (hereinafter referred to as the "Inquiry Letter") issued by your exchange on May 6, 2026. Grant Thornton (Special General Partnership) (hereinafter referred to as "we" or "Reporting Accountants") has carefully studied and implemented the issues raised in the Inquiry Letter that require an accountant's response, and has provided responses to the involved matters in accordance with the requirements of the Inquiry Letter. We hereby submit this to your exchange for review. Unless the context otherwise requires, the abbreviations used in this response have the same meanings as those in the "Prospectus for the 2025 Issuance of A-Shares to Specific Targets by Fujian Ashine New Material Technology Co., Ltd." (hereinafter referred to as the "Prospectus").
The financial data analysis in this response covering the period from January to March 2026 and as of March 31, 2026, refers to the reporting period of "2023, 2024, 2025, and January-March 2026." The financial data for January-March 2026 and as of March 31, 2026, in this response is unaudited.
In this response, the sum of some tables may differ slightly from the sum of the individual items due to rounding; unless otherwise specified, the currency involved in this response is Renminbi.
Question 1
According to the application documents, during the reporting period, the company's operating income was 694.8313 million yuan, 957.9273 million yuan, 1,183.0143 million yuan, and 1,092.7573 million yuan, respectively, showing a year-on-year increase; net profit attributable to the parent company was 14.0836 million yuan, 12.2724 million yuan, -25.3359 million yuan, and -30.8107 million yuan, respectively; the comprehensive gross profit margin was 14.24%, 11.63%, 6.23%, and 4.93%, respectively, showing a year-on-year decline; the net cash flow from operating activities was -7.5344 million yuan, -13.6927 million yuan, 60.4868 million yuan, and -27.8808 million yuan, respectively, showing significant volatility.
During the reporting period, direct materials accounted for a high proportion of the company's production costs. The main raw materials required for the company's production are metals, and their prices are affected by market supply and demand, showing varying degrees of fluctuation. The raw materials for the company's PVD coating material products include metal materials such as gold, silver, copper, aluminum, molybdenum, and indium, and there are overseas sales. Among them, some materials involved in the company's business are currently subject to export controls.
The company adopts a sales model combining domestic and foreign sales. The proportion of overseas sales revenue in each period of the reporting period was 27.32%, 21.23%, 13.78%, and 11.20%, respectively, showing a year-on-year downward trend. The main business of the issuer's subsidiary, Taiwan Ashine New Material Technology Co., Ltd., includes international trade business.
At the end of each period of the reporting period, the book balance of the company's inventory was 347.8972 million yuan, 402.6377 million yuan, 466.4628 million yuan, and 509.6658 million yuan, respectively, continuing to increase. The book value of the issuer's fixed assets was 584.6112 million yuan, 579.6675 million yuan, 652.4210 million yuan, and 648.3386 million yuan, respectively. From January to September 2025, the company's capacity utilization rate was 74.87%.
As of September 30, 2025, the book value of the company's derivative financial assets was 2.4307 million yuan, other receivables were 4.6694 million yuan, other current assets were 107.8739 million yuan, and other non-current assets were 13.4015 million yuan. The company and its subsidiaries carried out futures hedging business during the reporting period.