Special Explanation on Financial Accounting Issues in the Application for Issuing Convertible Bonds by Shenzhen Huichuangda Technology Co., Ltd. (Revised Draft)
To: Grant Thornton (Special General Partnership)
Address: 5th Floor, Siter Plaza, No. 22 Jianguomenwai Avenue, Chaoyang District, Beijing, China
Postal Code: 100004
Phone: +86 10 8566 5588
Fax: +86 10 8566 5120
Website: www.grantthornton.cn
Shenzhen Stock Exchange: We acknowledge receipt of your inquiry letter dated November 12, 2025, regarding the application of Shenzhen Huichuangda Technology Co., Ltd. to issue convertible bonds to unspecified objects (Inquiry Letter No. 2025-020066). In response to the financial accounting issues raised in the inquiry letter, Grant Thornton (Special General Partnership) (hereinafter referred to as "the Accountant" or "we") has conducted a review of the relevant materials of Shenzhen Huichuangda Technology Co., Ltd. (hereinafter referred to as "Huichuangda," "the Company," "the Listed Company," or "the Issuer") and provides the following special explanation: Unless otherwise specified, the abbreviations or proprietary terms used in this response are consistent with those defined in the "Prospectus for the Issuance of Convertible Bonds by Shenzhen Huichuangda Technology Co., Ltd. (Draft)." In this special explanation, discrepancies in totals and subtotals are due to rounding.
1. Financial Performance Overview
During the reporting period, the Issuer's operating revenues were 827,608,800 yuan, 1,356,071,100 yuan, 1,473,595,100 yuan, and 696,732,900 yuan, respectively. After deducting non-recurring gains and losses, the net profits attributable to the parent company were 124,687,200 yuan, 77,396,900 yuan, 96,569,900 yuan, and 30,649,600 yuan, respectively. The Issuer's latest net profit after deducting non-recurring gains and losses decreased by 21.56% year-on-year; in 2023, the net profit after deducting non-recurring gains and losses decreased by 37.93%. The comprehensive gross profit margins for the Company during the reporting period were 31.79%, 25.51%, 27.20%, and 26.86%, showing some fluctuations. At the end of each reporting period, the book value of the Issuer's inventory was 130,803,100 yuan, 223,067,300 yuan, 280,529,500 yuan, and 322,904,300 yuan, respectively; the inventory turnover rates were 3.80 times, 5.30 times, 3.93 times, and 3.14 times, respectively. At the end of each reporting period, the book value of accounts receivable was 273,743,100 yuan, 522,442,700 yuan, 477,321,200 yuan, and 448,521,600 yuan, respectively. The bad debt provision for accounts receivable was 17,101,900 yuan, 28,185,200 yuan, 36,502,600 yuan, and 35,469,200 yuan, accounting for 5.88%, 5.12%, 7.10%, and 7.33% of the accounts receivable balance at the end of the period, respectively. At the end of the most recent reporting period, the Issuer's goodwill was 159,449,200 yuan.
In 2023, the Company acquired 100% of Dongguan Xinweixing Electronics Co., Ltd. (hereinafter referred to as "Xinweixing") through the issuance of shares and cash payment, resulting in an increase in the original value of goodwill by 159,449,200 yuan. The Company set performance commitments for the three-year period from 2022 to 2024, promising net profits after deducting non-recurring gains and losses of 40,000,000 yuan, 44,000,000 yuan, and 48,000,000 yuan, respectively. Xinweixing achieved net profits after deducting non-recurring gains and losses of 39,697,600 yuan, 46,376,200 yuan, and 51,496,800 yuan from 2022 to 2024, respectively.