New Industry: Share Buyback Considers Improving Incentives, Clarifies Future Shareholder Return Plan

Investor Question:

Dear Xinchuang Secretary, hello! Recently, the company has implemented a share repurchase, but some investors are concerned about the scale and purpose of the buyback. What are the main considerations behind the current repurchase plan? When using repurchased shares for employee incentives, how does the company balance motivating the team while protecting the interests of small and medium shareholders? Given the current pressure on the secondary market, will the company further optimize buyback efforts or shareholder return mechanisms to boost investor confidence? We look forward to understanding the company’s overall considerations and plans. Thank you for your response.

Secretary’s Answer (Xinchuang SZ300832):

Hello, regarding the company’s recent share repurchase plan, the main considerations are to improve the employee incentive mechanism and to recognize the company’s long-term value.
In balancing employee incentives and the interests of small and medium shareholders, the company believes that this buyback will help further enhance and enrich the company’s long-term incentive system, effectively motivate core team members, and ensure that key personnel develop with the company over the long term. This approach effectively aligns shareholder interests, company interests, and employee interests, supporting the company’s sustainable and healthy development.
Regarding future shareholder return mechanisms, the company has formulated the “2024-2026 Shareholder Dividend Return Plan,” promising that, under profitable conditions, the company will distribute no less than 20% of its distributable profits each year; when cash dividends are feasible, the cash dividend ratio will not be less than 10% of the distributable profits for that year, maintaining continuity and stability of the dividend policy. Moving forward, the company will consider market conditions, operational status, and funding needs to comprehensively evaluate the use of buybacks and dividends to effectively maintain investor confidence. Thank you for your attention!

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Disclaimer: This information is excerpted by Sina Finance from public sources and does not constitute any investment advice; Sina Finance does not guarantee the accuracy of the data, and the content is for reference only.