Huaibei GreenGold Industry Investment Co., Ltd. Announces Material Disclosure Under Listing Rules

Key Points of the Announcement

• Significant Trade Payment and Delay in Steel Procurement: Huaibei GreenGold Industry Investment Co., Ltd. (“the Company”) entered into a framework agreement with Huaibei City Construction Investment Holding Group Co., Ltd. (“Huaibei Construction Investment Group”) on 25 December 2025 for the procurement of steel-related products.
• Large Prepayment: On the same day, the Company placed a purchase order and paid approximately RMB294.2 million for steel products, with a delivery deadline of 10 January 2026.
• Unforeseen Delivery Delay: The supplier, Huaibei Construction Investment Group, failed to deliver the products on time due to specialized specification requirements and severe adverse weather (heavy snow) disrupting logistics.
• Full Refund Received: After negotiations, both parties agreed to a full refund. As of the announcement date, the RMB294.2 million has been refunded in full to the Company.
• Listing Rules Breach: The amount paid to Huaibei Construction Investment Group exceeded 8% of the Company’s total assets as of 30 June 2025. This triggered disclosure requirements under Rules 13.13 and 13.15 of the Hong Kong Listing Rules, which were not met in a timely manner.
• Remedial Actions: The Company describes this as a one-off, isolated incident due to a misinterpretation of the Listing Rules. To prevent recurrence, they will provide additional Listing Rules training for all directors, senior management, and financial staff.

Details Relevant to Investors and Shareholders

1. Materiality of Transaction: The transaction involved a substantial amount—RMB294.2 million—which exceeded 8% of the Company’s total assets, making it highly material and potentially price sensitive.
2. Risk Exposure and Mitigation: The funds were unsecured and interest-free, exposing the Company to credit risk until the refund was received. However, the full refund has mitigated any financial loss to the Company.
3. Non-Compliance with Disclosure Obligations: The failure to promptly disclose the advance payment as required under the Listing Rules could raise concerns about the Company’s internal compliance and governance systems. Such issues can affect investor confidence and thereby the share price.
4. Operational and Logistical Risks: The report highlights operational risks from supply chain disruptions and extreme weather, which may affect future procurement activities.
5. Commitment to Improved Compliance: The Company’s pledge to strengthen internal controls and compliance training may help restore investor confidence but underscores the importance of robust governance systems.

About Huaibei Construction Investment Group

Huaibei Construction Investment Group is a wholly state-owned company (via Huaibei SASAC) involved in urban development, public services construction, transportation operations management, cultural tourism, and urban infrastructure. The Company has confirmed that Huaibei Construction Investment Group and its ultimate beneficial owners are independent third parties, with no connection to the Company or its connected persons.

Board Statement and Remedial Measures

The Board considers this non-compliance a one-off event resulting from a misinterpretation of the Listing Rules. To address this, the Company plans targeted training for key staff and management to prevent future breaches.

The Board, led by Mr. Liu Yong (Chairman and Executive Director), has reaffirmed its commitment to transparency and regulatory compliance.

Potential Impact on Share Price

This announcement is material and price sensitive. The significant size of the transaction, the initial breach of disclosure rules, and the subsequent prompt refund all represent developments that could move the share price. Investors should take note of the Company’s exposure to procurement and compliance risks, as well as remedial actions being implemented to strengthen internal controls.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should carefully review official filings and consult their financial advisors before making investment decisions. The author and publisher accept no liability for any loss arising from reliance on the information contained herein.

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