Consideration of establishing the second Yongjin Plant in Vietnam and the progress of the project in Thailand

Progress of the Vietnam project and consideration of establishing the second Yongjin Plant in Vietnam.

The Yongjin project in Vietnam officially started production in April 2022. Although the utilization rate of production capacity was affected by factors such as overseas demand, it still demonstrated strong profitability and generally met profit expectations. Vietnam's Yongjin is an export-oriented enterprise, with its products primarily sold to Southeast Asia, Europe, and other regions. According to local requirements in Vietnam, our products have minimal sales in the domestic market. However, with the development of Vietnam, including the influx of overseas investments, there is a growing demand in the local market, and the price difference for processing is considerable. Therefore, based on the company's research, a decision has been made to establish a domestic sales company targeting the Vietnamese market in the northern part of Vietnam to meet the local market's demands.

Progress of the Thailand project:

Due to the relatively low efficiency of approval procedures in Thailand, and the requirement for national approval for projects that meet the daily production capacity, the environmental impact assessment (EIA) for the project is still pending. Therefore, construction has not yet started, and the company will proceed with project construction once the necessary procedures are completed. Currently, there are no signs of devaluation for the company's land assets in Thailand, indicating minimal impact on the overall project's subsequent construction.