Huitongda Network Co., Ltd. (Stock Code: 9878) announced Board approval for a proposal to use reserves to offset accumulated losses. According to audited figures as of December 31, 2024, the company reported RMB2,065.456 million in accumulated losses, with capital reserve at RMB9,267.639 million and no surplus reserve balance.

The losses primarily stemmed from interest expenses associated with financing rounds prior to the company’s initial public offering. Under the proposal, RMB2,065.456 million from the capital reserve — derived from share premiums contributed in monetary form — will be used to eliminate the accumulated losses at the parent-company level.

Following the offset, the capital reserve will stand at RMB7,202.183 million, and the accumulated losses will be cleared to RMB0. The Board anticipates that this move will strengthen the company’s financial footing and position it more favorably for future dividend distributions. The proposal will be submitted for shareholder approval at an upcoming general meeting, with further details to be provided in a circular published by the Hong Kong Stock Exchange and the company’s website.