Orient wholly-owned subsidiary increased capital of more than 350 million yuan for the two grandchild companies

Orient (600666) announced on the evening of April 11 that Harbin Orient Optoelectronic Technology Co., Ltd. (hereinafter referred to as “Orient Limited”), a wholly-owned subsidiary of the company, intends to use the currency and debt-to-equity swaps to wholly-owned by the company. Harbin Qiu Guan Optoelectronics Technology Co., Ltd. (hereinafter referred to as "Qiu Guan Optoelectronics") increased its capital by 208 million yuan; it intends to use the currency and debt-to-equity swap method for the company's wholly-owned Sun Company Qitaihe Orient Optoelectronics Technology Co., Ltd. (hereinafter referred to as " Qitaihe Orient has increased its capital by 150 million yuan.

According to the announcement, the main business scope of Qiuguan Optoelectronics: R&D, production and sales of semiconductor substrate materials, photoelectric functional materials and related new materials and products; R&D, production and sales of special equipment for artificial crystals and new materials; development of optoelectronic technology; sapphire Development, production and sales of material integrated package chips, high thermal conductivity transparent brackets, lighting chips, and LED lamps.

As of December 31, 2016, Qiu Guan Optoelectronics (audited) had a net asset of 290 million yuan, operating income of 54.11 million yuan and net profit of -24.72 million yuan.

The main business scope of Qitaihe Orient: investment and management of sapphire crystal materials project, semiconductor, laser and photoelectric window materials projects.

As of December 31, 2016, Qitaihe Orient (audited) had a net asset of 1.68 million yuan; operating income was 35.22 million yuan; net profit was -17.43 million yuan.

The announcement stated that Orient Limited intends to increase the capital by means of currency and debt-to-equity swaps for Qiu Guan Optoelectronics and Qitaihe Orient, which will effectively reduce the operating burden of the subordinate Sun Company, improve the financial situation, and improve the investment and financing of the subordinate Sun Company. The ability is beneficial to the wholly-owned Sun Company to enhance its comprehensive competitiveness and promote its sustainable development, in line with the overall interests of the company's development.

According to industry insiders, Orient is a global sapphire leader with continuous sapphire processing and equipment. At present, it has an industry leading position in the large-scale production of sapphire crystal growth and single crystal furnace equipment manufacturing, and gradually cuts the whole industrial chain layout by cutting into the hard and brittle material processing links.

The company's performance has improved steadily in recent years, and its growth rate has remained above 60%. Through large-scale and large-scale effects, we will invest in research and development of high-margin single-crystal furnace equipment products and new sapphire crystal ingot products to improve product structure and maintain its profitability.

The company's research products mainly include 3D glass bending equipment, 3D arc polishing equipment and various engraving and milling equipment. At present, the 3D hot bending machine has been shipped in small quantities, and it is expected to become the second star product outside the company's single crystal furnace in the future, which will be a new growth point for its performance.

The large-scale capital increase of the two Sun companies has increased their financial strength, which is conducive to their competitiveness and further development, and is also conducive to the improvement of the overall operating performance of listed companies.


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