2021 Company Symposium – Annual Work Summary

Solidly Summarize and Highlight Achievements Advance Steadily, Usher in the Future

— Annual Work Summary of Lingzhou Company

2021 This has been an extraordinary year. The ongoing global spread of the COVID-19 pandemic, coupled with a sharp decline in end-user demand, has had a profound impact on the chemical market, resulting in extremely low operating margins across the industry, including for propylene. Nevertheless, under the strategic guidance and sound decision-making of the Group’s leadership, all employees have… With “High quality, honoring contracts, and maintaining credibility” in serving our customers, With unified efforts and close collaboration, we will actively support upstream and downstream enterprises in overcoming their challenges and strive to ensure supply-chain stability. Strive to build the largest propylene service-oriented trading enterprise in China. The group’s full-year Complete propylene trading 48.99 Ten thousand tons, carried by logistics-operated vessels 290 Voyage 56.38 Ten-thousand-ton and tank-car transportation 2748 Train number 5.84 Ten thousand tons. The group’s subsidiaries collectively achieved total operating revenue for the year. 7.107 billion Diversity, payment of taxes and fees 31.2232 million Diversity showcases the Group’s best performance in its history of development.

I. Emphasize learning, stay abreast of policies, and promote the orderly operation of the group company.

Against the backdrop of global economic and financial turmoil, China’s economy is also facing challenging and complex circumstances. Influenced by a variety of factors—including policy and reform initiatives, as well as macro- and micro-level dynamics—market prices for raw materials have been volatile and unpredictable, leading to a complicated economic development landscape and a widespread decline in corporate profits nationwide. For enterprises, navigating this environment is akin to rowing upstream; to advance corporate development in a steady and sustainable manner, it is essential that we diligently study relevant policies and carefully assess the prevailing situation. Throughout the Group’s operations, all employees have consistently prioritized learning about national policies, analyzing the economic outlook and chemical market trends, and focusing on continuous improvement and effective implementation. By staying attuned to policy developments and seizing emerging business opportunities, the Group The company is continuously expanding its business scope and penetrating the downstream polypropylene powder market, leveraging propylene contract processing to Nanjing, Wenzhou, and others The Group has established collaborations with multiple manufacturing enterprises. Building on this foundation, it has boldly entered into a joint venture with Hangzhou Puli Materials Technology Co., Ltd. to produce polyester polyols. This project will manufacture biodegradable polycarbonate plastics and carbon-dioxide-based polyester polyols, aiming to address China’s shortcomings in the development and industrial-scale production of biodegradable plastics, explore technological approaches for synthesizing biodegradable materials from non-petroleum feedstocks, reduce material costs, minimize pollutant emissions, and mitigate the global greenhouse effect. In addition, the Group has formed a joint venture with Jiangsu Blue Planet Environmental Protection Technology Co., Ltd. to produce propylene oxide. Propylene oxide is the third-largest propylene derivative after polypropylene and acrylonitrile, primarily used in the production of polyethers, propylene glycol, and other derivatives. These derivatives are widely employed in industries such as automotive, construction, food, tobacco, pharmaceuticals, and cosmetics, with nearly one hundred downstream products already on the market, making propylene oxide a crucial raw material for fine chemicals.

II. Attach great importance to talent, standardize management, and enhance the management level of the group company.

“Talent is the foundation of a strong enterprise, and standardization is the guiding principle for corporate governance.” In pursuing transformation and development, the Group has steadfastly adhered to a talent-driven strategy and built a multifaceted, multi-tiered talent pool. Over recent years, through dedicated training and development, the Group has cultivated a management team that is highly proficient in its field, adept at operations, skilled in management, and capable of driving innovation and excellence. At the same time, recognizing that internal management is the cornerstone of the Group’s survival and growth, Chairman Ling Haoming and General Manager Zhou Jianhuai have, with visionary leadership and keen awareness of the times, steered the Group to prioritize streamlining relationships, grounding initiatives in robust institutional frameworks, and leveraging enhanced service quality as a key lever to continuously strengthen human resource management. To promote innovative growth, the Group is restructuring its business model and enhancing its level of automation. In September 2021, the Group partnered with Oracle and Hande to launch an ERP management system. The successful implementation of the ERP project will significantly enhance the Group’s operational efficiency, enable it to better align with modern enterprise management practices, provide IT support for the Group’s overall strategy, and facilitate the development of an integrated business-and-finance platform. The Group also We consistently place internal management at the core of our work, striving to achieve tangible results through effective management and leveraging management to drive development. We adhere to a balanced approach that combines institutionalized management with people-oriented management, ensuring clear division of responsibilities, mutual support, close collaboration, and timely refinement and formulation of procurement policies, contract management procedures, employee management frameworks, and performance appraisal systems that are tailored to the Group’s development needs. 1 Three internal management standards and systems ensure clear business processes and orderly collaboration among employees, thereby effectively supporting the Group’s standardized operations.

III. Foster unity and collaboration, ensure close coordination, and smoothly accomplish the Group’s operational tasks.    

Guided by the principles of “prioritizing corporate interests, fostering mutual respect, and maintaining timely communication,” we have strengthened coordination and collaboration among the Group’s departments to ensure the smooth, safe, and efficient operation of the Group’s trading, warehousing, logistics, and joint-venture and cooperative activities. We remain committed to creating value through service and to building a service-oriented, innovation-driven enterprise. Over time, we have cultivated a business philosophy characterized by unity, integrity, pragmatism, and innovation; respected the central role of our employees; and safeguarded their legitimate interests, thereby significantly enhancing the Group’s cohesion. For example, at the Group’s weekly Monday meeting, we not only report on the week’s progress but also engage in mutual exchange and discussion, promptly refining our work processes—resolving minor issues on the spot and setting deadlines for rectifying major ones—thus effectively facilitating the smooth execution of weekly tasks. Successfully complete the group’s monthly operational tasks. 。

IV. Prioritize safety and strengthen management to ensure the safe operation of the Group.

As a hazardous chemicals operator, ensuring safe production across trading, warehousing, and logistics operations is the lifeblood of the Group and the top priority in its management. It directly affects the Group’s survival and development as well as the vital interests of every employee. To this end, Group leadership places utmost emphasis on safety, consistently treating it as the paramount task. Measures include establishing a dedicated task force for safety production, appointing safety officers, organizing monthly safety training sessions, developing emergency response plans and conducting regular drills, engaging third-party firms to conduct quarterly safety assessments, and implementing dynamic safety-rating management for hazardous-materials transport enterprises. As a result, a strong safety-conscious culture has taken root throughout the Group. Thanks to the concerted efforts and unwavering commitment at all levels, the Group has achieved excellent results over the past year, maintaining a record of zero safety-related accidents for the entire year.

V. Strengthen cultural development and enhance the sense of ownership among Group employees.

Corporate culture unites people and drives value, while brand value translates into tangible business results. To build a robust corporate culture, it is essential to articulate and embody the organization’s core values, harness the power of culture to stimulate productivity, and strengthen cohesion, execution capability, and creativity—thereby elevating the group’s core competitiveness. Corporate culture serves as a powerful guarantee for achieving the enterprise’s sustainable development goals; reinforcing cultural development simultaneously addresses the foundational imperative of advancing productive forces and the pivotal role of fostering an advanced social culture, thereby promoting the enhancement of employees’ moral character and cultural literacy. Employees are the foundation of an enterprise. , outstanding employees are the winning formula for enterprise development. How Cultivating an entrepreneurial spirit and strengthening organizational cohesion are central components of corporate culture development, fostering in management practices a spirit and ethos that reflect the unique identity of the organization, thereby enhancing employees’ sense of responsibility and mission. Enhance employees’ sense of ownership, To realize employees’ personal fulfillment and achieve the shared development of the company and its employees. In response to these issues, the Group General Manager Zhou Jianhuai has pioneered innovative approaches to the group’s management model, placing great emphasis on caring for and respecting employees. Foster a sense of collective striving and upward momentum among employees. For example, within the group Personally presented at the weekly meeting to those who have received it. Outstanding “Star of the Week” recipients are rewarded with a bouquet of fresh flowers; on employees’ birthdays, the company organizes a heartwarming “joint wish and shared cake” celebration; when an employee falls ill, the organization promptly arranges a home visit accompanied by a condolence payment to offer warm support; and during holidays, thoughtful greeting messages are sent to employees to convey sincere regards. In addition, the group annually hosts team-building activities and provides health check-ups for employees, further highlighting its rich corporate culture. Within the group Amid a heartwarming, reassuring, and genuinely sincere atmosphere, the employees of the group company There is clearly a group of people around us who faithfully perform their duties. Their selfless dedication inspires their colleagues to forge ahead with courage; they put the interests of clients and the team first, and through their passion for and respect toward their profession, they have earned the recognition and trust of both clients and group leadership.