Yuandong Biology: Subsidiary Tibet Runhe received the "Tax Administration Penalty Notice"

Yuandong Biology announced that its wholly-owned subsidiary, Tibet Runhe Pharmaceutical Co., Ltd., has received a "Notice of Tax Administrative Penalty" issued by the Taxation Bureau of the Tibet Autonomous Region of the State Administration of Taxation. The tax authorities intend to determine that Tibet Runhe obtained false and void invoices from upstream service providers from 2017 to 2021, and should pay a corporate income tax of 8,579,102.18 yuan. Tibet Runhe is also proposed to be fined 4,289,551.09 yuan, and for the underpaid taxes, a late payment fee of 0.05% per day will be added from the date of delay. The tax authorities have determined that no fund inflow was found during the inspection process, and the false invoices were issued by the upstream service providers, with no evidence showing Tibet Runhe actively participating in the false invoicing. Based on the principle of accounting prudence, Tibet Runhe has made provisions for the aforementioned overdue taxes, late fees, and fines in the financial statements for the year 2025, and it is expected not to affect the net profit attributable to the shareholders of the listed company in 2026. The specific accounting treatment and the amount of impact will be based on the data audited by the annual accounting auditor.