BGI: Announcement on launching foreign exchange hedging business in 2026
Securities code: 300676 Securities abbreviation: BGI Announcement number: 2025-059
Shenzhen BGI Co., Ltd.
Announcement on launching foreign exchange hedging business in 2026
The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete, and contains no false records, misleading statements or major omissions.
Important content reminder:
Transaction amount and term: In order to improve the company's ability to cope with foreign exchange fluctuation risks, reduce the impact of large exchange rate fluctuations on the company's performance, and enhance financial stability, the company and its subsidiaries within the scope of consolidated statements plan to continue to engage in foreign exchange arbitrage transactions in 2026. Financial institutions with qualifications to operate futures hedging business carry out foreign exchange hedging business. Transaction types include but are not limited to forward foreign exchange settlement and sales, foreign exchange swaps, foreign exchange options and other products or a combination of the above products; it is expected that the maximum contract value held on any trading day will not exceed RMB 1 billion or equivalent foreign currency (including the principal amount, the same below). This quota is valid for 12 months from January 1, 2026 to December 31, 2026, and can be used on a rolling basis within the authorization period.
Review procedures completed: This matter has been reviewed and approved at the seventh meeting of the company's fourth board of directors and the seventh meeting of the fourth board of supervisors. According to the provisions of the "Shenzhen Stock Exchange Self-Regulatory Guidelines for Listed Companies No. 7 - Transactions and Related Transactions", this proposal still needs to be submitted to the company's second extraordinary shareholders' meeting in 2025 for review.
Special risk warning: The company conducts foreign exchange hedging transactions in accordance with the principles of legality, prudence, safety and effectiveness, and does not engage in speculative or arbitrage trading operations. However, there are still certain market risks, liquidity risks, performance risks and internal control risks in the process of foreign exchange hedging business. Investors are advised to pay attention to investment risks.
1. Overview of the transactions of this foreign exchange hedging business
(1) Purpose of transaction
The company's foreign exchange hedging business is closely related to its daily operations. In recent years, affected by international political and economic uncertainties, the foreign exchange market has fluctuated more frequently. When market exchange rates fluctuate significantly, exchange gains and losses will have a certain potential impact on the company's operating performance. In order to minimize the impact of exchange rate fluctuations on the company's performance, the company and its subsidiaries within the scope of consolidated statements plan to continue to carry out foreign exchange hedging business in 2026 without affecting the company's main business development and capital use arrangements. This trading business takes "preserving value" rather than "appreciating value" as the core management objective of foreign exchange risk, follows the hedging principle, and does not engage in speculation or simple arbitrage transactions. The company effectively uses foreign exchange hedging tools to lock in transaction costs in the foreign exchange market to enhance financial stability and reduce the adverse impact that large fluctuations in exchange rates may have on the company's operating performance.
(2) Transaction method
Mainly involving currencies and business types: The company carries out foreign exchange hedging business for the purpose of hedging, and is limited to the main settlement currencies used in the production and operation of the company and its subsidiaries. The main foreign currencies include US dollars, Hong Kong dollars, euros, etc. The trading types of the foreign exchange hedging business planned to be carried out by the company include but are not limited to forward foreign exchange settlement and sales, foreign exchange swaps, foreign exchange options and other products or a combination of the above products.
Counterparty: The counterparty of the company's foreign exchange hedging business is a financial institution approved by regulatory agencies and qualified to operate foreign exchange hedging business, and has no related relationship with the company.
Main trading strategies: The company plans to use foreign exchange market derivatives to hedge exchange rate risks. The derivatives used include foreign exchange forwards, foreign exchange options and other foreign exchange derivatives. The company formulates derivatives transaction hedging ratios based on risk exposure. The company's foreign exchange hedging transactions follow the following principles: generally choose basic derivatives and try to avoid complex derivatives combinations; adhere to the principle of neutrality of exchange rate risk; with the sole goal of locking in exchange rate fluctuation risks and not for the purpose of profit.
(3) Transaction amount
Based on the company's asset size and business needs, the company and its subsidiaries within the scope of consolidated statements will continue to carry out foreign exchange hedging business in 2026, and it is expected that the maximum contract value held on any trading day will not exceed RMB 1 billion or equivalent foreign currency. Within the authorization period, this quota can be used on a rolling basis, and the transaction amount at any point in time (including the amount related to re-trading of the proceeds from the aforementioned transactions) does not exceed RMB 1 billion or its equivalent in foreign currency.
The company and its subsidiaries within the scope of consolidated statements carry out foreign exchange hedging business and pay deposits and option fees as necessary in accordance with agreements signed with banks and other financial institutions. The margin is paid directly as a certain proportion of the transaction principal or in the form of occupying the comprehensive credit limit of a financial institution. The proportion of margin payment is determined according to the specific agreement signed with the bank.
(4) Transaction period
The above quota is valid for 12 months from January 1, 2026 to December 31, 2026, and the quota can be used on a rolling basis during the authorization period. If the duration of a single transaction exceeds the authorization period, the authorization period will automatically be extended until the transaction is terminated.
(5) Liquidity arrangements
The company and its subsidiaries within the scope of consolidated statements carry out foreign exchange hedging business based on normal foreign exchange assets and liabilities, and the business amount and business period match the expected changes in exposure.
(6) Source of funds
The source of funds for the foreign exchange hedging business carried out by the company and its subsidiaries within the scope of consolidated statements is its own funds, and there is no use of raised funds or bank credit funds to engage in this business.
(7) Information disclosure
The company will carry out foreign exchange hedging transactions in compliance with relevant requirements such as the "Shenzhen Stock Exchange GEM Stock Listing Rules", "Shenzhen Stock Exchange Self-Regulatory Guidelines for Listed Companies No. 2 - Standardized Operations of GEM Listed Companies", "Shenzhen Stock Exchange Self-Regulatory Guidelines for Listed Companies No. 7 - Transactions and Related Transactions" and other relevant requirements, and will disclose in regular reports the relevant progress and implementation of the foreign exchange hedging business that has been carried out.
2. Review procedure
The company and its subsidiaries within the scope of consolidated statements plan to continue to carry out foreign exchange hedging business in 2026. The matter has been reviewed and approved at the seventh meeting of the company’s fourth board of directors and the seventh meeting of the fourth board of supervisors held on October 23, 2025. The sixth meeting of the independent directors’ special meeting of the company’s fourth board of directors issued an agreed review opinion on this matter. This matter was reviewed and approved at the seventh meeting of the Audit Committee of the fourth session of the Board of Directors before being submitted to the company's board of directors for review. According to relevant regulations such as the "Shenzhen Stock Exchange GEM Listing Rules", "Shenzhen Stock Exchange Self-Regulatory Guidelines for Listed Companies No. 2 - Standardized Operations of GEM Listed Companies", "Shenzhen Stock Exchange Self-Regulatory Guidelines for Listed Companies No. 7 - Transactions and Related Transactions", "Articles of Association", "Securities Investment, Futures and Derivatives Transaction Management System" and other relevant regulations, the proposed foreign exchange hedging business does not involve related transactions. After being reviewed and approved by the company's board of directors, this proposal still needs to be submitted to the company's shareholders' meeting for review.
The company's board of directors requested the shareholders' meeting to authorize the company's general manager to exercise investment decision-making power in accordance with relevant regulations within the above-mentioned authorization limit and authorization period and sign relevant legal documents. The company's finance and economics department is responsible for specific implementation matters.
3. Transaction risk analysis and risk control measures
(1) Investment risks
The company's foreign exchange hedging business follows the principles of legality, prudence, safety and effectiveness, and does not engage in speculative or arbitrage trading operations. However, there are still certain risks in foreign exchange hedging business, including:
Market risk: The difference between the exchange rate and interest rate of the foreign exchange hedging transaction contract and the actual exchange rate and interest rate on the maturity date will generate transaction profits and losses; during the duration of the foreign exchange derivatives, revaluation profits and losses will occur in each accounting period, and the cumulative value of the revaluation profits and losses by the maturity date is equal to the transaction profits and losses.
Liquidity risk: the risk of being unable to complete a transaction due to insufficient market liquidity.
Performance risk: Carrying out financial derivatives business involves the risk that the counterparty will not be able to perform when the contract expires.
Internal control risk: Foreign exchange hedging is highly professional and complex. When conducting transactions, there may be a risk of loss during the business process due to operators failing to operate according to prescribed procedures, failing to accurately and timely identify business-related information, or other internal control systems being imperfect.
(2) Risk control measures
In order to reduce internal control risks: the company has formulated and recently revised the "Securities Investment, Futures and Derivatives Trading Management System", which clearly stipulates the operating principles, approval authority, internal operating procedures, information isolation measures, internal risk reporting system and risk handling procedures, information disclosure, etc. for the foreign exchange derivatives trading business. The company's foreign exchange derivatives transactions are based on normal production and operations and rely on specific business operations, and speculation and arbitrage transactions are not allowed. At the same time, business operations are strictly carried out in accordance with the relevant regulations on foreign exchange derivatives transactions to control transaction risks.
In order to reduce the risk of significant exchange rate fluctuations: the company strengthens research and analysis on exchange rates, pays real-time attention to changes in the international market environment, and adjusts trading strategies in a timely manner to avoid exchange losses to the greatest extent.
Transaction management: The company only conducts foreign exchange hedging business with large banks and other financial institutions that have the qualifications to operate foreign exchange hedging business to ensure the legality of the company's foreign exchange hedging transactions. At the same time, the company will carefully review the terms of contracts signed with financial institutions and strictly implement the risk management system to prevent legal risks.
Risk warning management: In order to minimize the adverse effects caused by large fluctuations in exchange rates, the company's Finance Department will continue to track changes in open market prices or fair values of foreign exchange derivatives, timely assess changes in risk exposures in foreign exchange hedging transactions, report abnormal situations to management in a timely manner, alert risks and implement emergency measures.
Internal control supervision and management: The company's internal audit and internal control department supervises and inspects the compliance of the decision-making, management, and execution of foreign exchange hedging transactions.
4. Accounting Processing Related to Transactions
The company will conduct corresponding accounting treatment for the foreign exchange hedging transaction business it intends to continue to carry out in accordance with relevant regulations and guidelines such as "Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments", "Accounting Standards for Business Enterprises No. 24 - Hedge Accounting", "Accounting Standards for Business Enterprises No. 37 - Presentation of Financial Instruments", "Accounting Standards for Business Enterprises No. 39 - Fair Value Measurement" and other relevant regulations and guidelines, which will be reflected in the relevant accounts of the balance sheet and profit and loss statement.
5. Impact of transaction on the company
The foreign exchange hedging business carried out by the company is closely related to the company's daily operations, follows the principle of stability, relies on specific operating businesses, and is carried out based on the company's foreign exchange assets, liabilities and foreign exchange receipts and payments. It is necessary for the company to make full use of the hedging function of foreign exchange derivatives to hedge exchange rate risks in operating activities, reduce exchange losses, and control operating risks.
The company's foreign exchange hedging business can, to a certain extent, reduce the possible adverse effects of large exchange rate fluctuations on the company's performance and help enhance financial stability. In view of the fact that the development of foreign exchange hedging business involves certain risks and the impact on the company is uncertain, the company will strictly follow relevant laws and regulations and the requirements of the "Securities Investment, Futures and Derivatives Transaction Management System" to strengthen process management and internal control, implement risk prevention and control measures, and promptly perform information disclosure obligations as required.
6. Relevant review procedures and review opinions
(1) Deliberation opinions of the board of directors
The company held the seventh meeting of the fourth board of directors on October 23, 2025 and reviewed and approved the "Proposal on Carrying out Foreign Exchange Hedging Business in 2026", agreeing that the company and its subsidiaries within the scope of consolidated statements will continue to use their own funds to carry out foreign exchange hedging business in 2026. It is expected that the maximum contract value held on any trading day will not exceed RMB 1 billion or equivalent foreign currency. This quota is valid for 12 months from January 1, 2026 to December 31, 2026, and can be used on a rolling basis within the authorization period.
The company's board of directors approved the "Proposal on Carrying out Foreign Exchange Hedging Business in 2026" and agreed to submit the proposal to the company's shareholders' meeting for review. The company's board of directors agreed to request the shareholders' meeting to authorize the company's general manager to exercise investment decision-making power in accordance with relevant regulations within the above-mentioned authorization limit and authorization period and sign relevant legal documents. The company's finance and economics department is responsible for specific implementation matters.
(2) Review opinions of special meetings of independent directors
The company held the sixth special meeting of independent directors of the fourth board of directors on October 20, 2025, and reviewed and approved the "Proposal on Carrying out Foreign Exchange Hedging Business in 2026". The company's independent directors believe that the foreign exchange hedging business carried out by the company and its subsidiaries within the scope of consolidated statements matches the company's daily operating needs, helps to hedge exchange rate risks in operating activities, and reduces the adverse impact of large exchange rate fluctuations on the company. The transaction is necessary. The company has issued a feasibility analysis report on the proposed foreign exchange hedging transactions. It is reasonable and feasible for the company to continue to carry out foreign exchange hedging transactions in 2026 based on its capital management and operating needs. The company's internal control procedures are sound, and the relevant review procedures for carrying out foreign exchange hedging business are legal and compliant, and there is no harm to the interests of the company and shareholders, especially the interests of small and medium-sized shareholders.
The company’s independent directors unanimously agreed that the company and its subsidiaries within the scope of consolidated statements will continue to carry out foreign exchange hedging business in 2026, and agreed to submit the matter to the company’s board of directors for review.
(3) Review opinions of the Board of Supervisors
The company held the seventh meeting of the fourth board of supervisors on October 23, 2025, and reviewed and approved the "Proposal on Carrying out Foreign Exchange Hedging Business in 2026". After review, the Board of Supervisors believes that the company and its subsidiaries within the scope of consolidated statements will continue to carry out foreign exchange hedging business in 2026, which will help hedging exchange rate risks in operating activities to a certain extent and reduce the adverse impact of large exchange rate fluctuations on the company. The company has formulated the "Securities Investment, Futures and Derivatives Trading Management System" and formulated specific operating procedures and feasible risk control measures for the company's foreign exchange derivatives trading business. At the same time, the "Feasibility Analysis Report on Carrying out Foreign Exchange Hedging Business in 2026" issued by the company provides sufficient feasibility analysis basis for the development of foreign exchange hedging business. The review process for this transaction was legal and compliant, and there was no harm to the interests of the company and shareholders, especially the interests of small and medium-sized shareholders.
The company’s Board of Supervisors unanimously approved the “Proposal on Carrying out Foreign Exchange Hedging Business in 2026”.
7. Documents for reference
(1) "Resolution of the Seventh Meeting of the Fourth Board of Directors";
(2) "Resolution of the Seventh Meeting of the Fourth Supervisory Board";
(3) "Resolution of the Sixth Special Meeting of Independent Directors of the Fourth Board of Directors";
(4) "Resolution of the Seventh Meeting of the Audit Committee of the Fourth Board of Directors";
(5) "Shenzhen BGI Co., Ltd.'s Feasibility Analysis Report on Carrying out Foreign Exchange Hedging Business in 2026".
Announcement is hereby made.
Board of Directors of Shenzhen BGI Co., Ltd.
October 24, 2025