Reader Media plans to invest 1 billion yuan in cash management to improve the utilization efficiency of idle funds

To improve the efficiency of capital utilization and returns, Reader Publishing & Media Co., Ltd. (Securities Code: 603999; Securities Abbreviation: Reader Media) held its 6th session of the board of directors’ 4th meeting on March 25, 2026, during which it deliberated and approved the resolution titled “Proposal on the Company’s Use of a Portion of Temporarily Idle Own Funds for Cash Management.”

The Company plans to use temporarily idle own funds of up to RMB 1.0 billion for cash management, investing in short-term financial products with high safety and good liquidity. This matter still needs to be submitted to the Company’s 2025 annual general meeting of shareholders for consideration and approval.

According to the announcement, the funds for cash management in this instance are sourced from a portion of the temporarily idle own funds of the Company and its subsidiary(ies). The investment period will be effective for 12 months from the date on which the Company’s 2025 annual general meeting of shareholders approves the proposal. During the investment period, the RMB 1.0 billion额度 (limit) can be used on a rolling basis. With respect to the investment method, after being deliberated and approved by the shareholders’ meeting, the board of directors will fully authorize the chairman to exercise the decision-making power for this investment, and the Company’s financial officer will be responsible for organizing the implementation by the finance department. For subsidiaries’ idle funds, the funds will be centrally pooled into the Company for cash management, and the returns obtained will be promptly returned to the subsidiaries’ capital accounts.

The Company states that this cash management will be carried out on the basis of ensuring the Company’s project investment needs, to ensure that it will not affect the Company’s normal production and operations, project investments, and business development. By investing in short-term financial products, the Company can increase its returns and deliver better investment returns to the Company and its shareholders.

Regarding investment risks, Reader Media points out that although the proposed underlying assets are bank and non-bank financial institution wealth management products with high safety, good liquidity, and a short term (no more than one year), and therefore involve relatively low risks, the financial market is heavily influenced by macroeconomic factors, and it cannot be ruled out that this investment may be affected by market volatility. To this end, the Company will take multiple measures to control investment risks, including conducting market due diligence, tracking product progress, establishing accounting ledgers, implementing separation of positions, internal audit supervision, and supervision and inspection by independent directors and the audit committee, among others.

In terms of accounting treatment, in accordance with the provisions of “Accounting Standards for Business Enterprises No. 22—Recognition and Measurement of Financial Instruments,” the principal of entrusted wealth management will be recognized as trading financial assets in the balance sheet, and the income upon maturity will be recorded in the profit and loss statement as investment income; the specific treatment will be subject to the results of the annual audit.

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