Share repurchase and cancellation, Dongpeng Beverage "adds value" for shareholders

On the evening of April 1st, Dongpeng Beverage (605499.SH) announced that it plans to repurchase A-shares through centralized bidding transactions, with a repurchase amount of no less than 1 billion yuan( including this amount), and no more than 2 billion yuan( excluding this amount). The funds for this repurchase will come from the company’s own capital, with a purchase price not exceeding 248 yuan per share. Of the repurchased shares, no less than 90% will be canceled to reduce registered capital, and the remaining portion will be used for employee stock ownership plans and/or equity incentives. This “cancellation-style” repurchase not only demonstrates the company’s high recognition of its own value but also sends a strong confidence signal to the market.

“Cancellation-style” Repurchase: A Direct Signal of Value Confidence

According to the announcement, the repurchase price for Dongpeng Beverage will not exceed 248 yuan per share( which is 150% of the average trading price of the company’s stock in the 30 trading days prior to the board resolution approving the repurchase), still offering considerable room compared to the closing price of 210.4 yuan on April 1st. The symbolic significance of this repurchase is self-evident; it is the management’s most direct and strongest signal to the market: the company believes that the current stock price does not fully reflect its intrinsic value.

More importantly, this repurchase adopts a “cancellation” approach, which is most favorable to shareholders. After the shares are canceled, the company’s total share capital decreases, and even if profits remain unchanged, core financial indicators such as earnings per share (EPS) will be directly and significantly improved. This not only optimizes the company’s capital structure and improves the supply-demand relationship of its stock but also helps stabilize and enhance the company’s valuation, conveying a positive message that management is confident about future development and policy expectations. In the long run, this value-driven repurchase behavior helps guide the market from short-term speculation to long-term value investment, consolidating the company’s financial health image.

Long-term Stable Dividend Mechanism: Continuing to Practice Shareholder Returns

Dongpeng Beverage’s large-scale repurchase is not an isolated capital operation but a continuation and deepening of its long-standing strategy of actively rewarding shareholders. Since its listing, the company has distributed dividends exceeding 6.6 billion yuan, truly rewarding investors’ trust with real cash. In its 2025 annual report released earlier, the company projected dividends of over 1.4 billion yuan, maintaining its dividend strength. The current repurchase and cancellation of shares is essentially another efficient and flexible way to reward shareholders, complementing cash dividends and jointly building a solid image of the company’s emphasis on investor returns and sharing development achievements with shareholders.

Responding to Policy Guidance: Standard Action of High-Quality Listed Companies

Share repurchases, especially “cancellation-style” repurchases, have become an important standard for measuring the governance level and responsibility of high-quality listed companies. The “Guiding Opinions on Strengthening the Supervision of Listed Companies (Trial)” issued on March 15, 2024, explicitly states that high-quality listed companies should actively carry out share repurchases, guiding more companies to repurchase and cancel shares to enhance market stability. At a press conference, Guo Ruiming, director of the Supervision Department of Listed Companies, also mentioned the need to stimulate listed companies’ awareness of rewarding investors and encourage repurchases and cancellations.

As a rare target in the A-share market with both growth potential and leading position, Dongpeng Beverage actively responds to regulatory policies. Its current repurchase action is not only a responsible move for its own development but also a practical contribution to the construction of the capital market, helping to stabilize market expectations and boost investor confidence.

Solid Performance Support: The Fundamental Guarantee of the Repurchase Action

Dongpeng Beverage’s confidence in launching this “cancellation-style” repurchase at this time mainly stems from its sustained excellent performance. According to its latest 2025 annual report, the company’s revenue and net profit have achieved seven consecutive years of high growth. In 2025, revenue surpassed 20 billion yuan, reaching 20.88B yuan, with net profit attributable to the parent company of 4.42B yuan, with growth rates exceeding 30%. Driven by the “1+6” multi-category strategy, the company has successfully transitioned from a single energy drink leader to a comprehensive beverage group, with the second growth curve “Dongpeng Hydration” rising strongly, and global expansion making milestone progress through the “A+H” dual-market drive. Such strong profitability and healthy cash flow provide the most solid foundation for the company to use its own funds for large-scale repurchase.

Dongpeng Beverage’s “cancellation-style” repurchase is a strategic move that combines value recognition, shareholder return, policy response, and performance demonstration. It not only clearly conveys management’s strong confidence in the company’s future prospects but also actively safeguards its investment value, with the potential to further optimize its capital structure, enhance shareholder returns, and inject stronger capital momentum into the company’s new chapter of globalization.