Strive for the Future with Competence, Win the Era with Efficiency —— 2026 Chinese New Year Message from the Chairman

As the year turns and a new chapter unfolds, on the occasion of the upcoming Chinese New Year, on behalf of the Board of Directors and the Management Committee of the company, I would like to extend my sincere gratitude and warmest New Year wishes to all colleagues fighting on all fronts of HONSOAR, and to your families who have understood, supported and stood by you for a long time. Meanwhile, I also pay high tribute to our customers, suppliers, and friends from all walks of life who have trusted us and walked hand in hand with us.The past year was a year full of challenges and an extraordinary one. The external environment was complex and volatile, industry competition intensified continuously, and pressures from the market, costs and delivery piled up layer upon layer. We moved through uncertainties and forged ahead under high pressure. Yet it was precisely in such an environment that the people of HONSOAR demonstrated remarkable resilience, determination and execution, offsetting fluctuations with hard work, confronting uncertainties with competence, and seizing the initiative with efficiency.This year, we delivered a solid performance in business operations.—— The three theaters of operations — Shuyang Theater, Kumi Alliance Theater and Hongshuo Theater — all achieved over 100% of their annual budget targets, delivering an outstanding performance of “steady progress amid headwinds” in a complex environment.—— Facing phased performance pressure in Impress Theater and Hong Kong Theater, the company resolutely adjusted its organization and strategies, took the initiative to stop losses and optimize the structure, faced problems head-on without avoidance, and traded short-term pain for long-term health, accumulating strength and creating room for the next stage of development.—— In terms of management, corresponding adjustments were made to management positions with unsatisfactory performance in quality, order fulfillment and other areas to strengthen weaknesses and consolidate foundations. A new IE Department was established to systematically promote efficiency improvement and process reengineering.—— Meanwhile, the company set up a Cost Reduction & Efficiency Improvement Committee to fully advance the systematic initiative of cost reduction, efficiency enhancement and labor productivity improvement.—— The construction of the IPD system was officially launched, enabling closed-loop collaboration among R&D, marketing, manufacturing and delivery.The Board of Directors firmly believes that a truly mature organization is not one that never encounters problems, but one that can quickly correct deviations, rebuild capabilities and restore momentum when problems arise.This year, we continued to make breakthroughs in innovation and capability building.The Decorative Materials Company was awarded the national-level "Little Giant of Specialization, Refinement, Differentiation and Innovation"; Shuyang Company passed the certification of High-Tech Enterprise; the company was selected as a "One Enterprise, One Technology" R&D Center in Shandong Province; new products such as "Antibacterial and Mildew-Proof Impregnated Paper" were included in the "Qilu High-Quality Products" list; and two new products passed the appraisal by national-level authoritative institutions. Innovation is not a slogan, but a systematic capability of continuous investment, iteration and learning.This year also witnessed an extremely important milestone achievement: multiple digital systems of the company were officially launched and put into operation, marking HONSOAR’s entry into a new stage of data-driven operations.Systems including CRM, SRM, MES, QMS and WMS were successively launched. Business decisions are no longer based on experience and guesswork, but on data; management no longer relies on personal supervision, but on systematic operation. This is a profound transformation of management methods and a quiet yet critical upgrade of capabilities. Digitalization is not for “showcasing technology”, but for clearer work, more scientific decision-making, smoother collaboration and stronger execution.This year, we took a crucial step in corporate culture and mechanism development.2025 marked an extremely important milestone in the company’s development: a new round of equity incentive was launched, and more key employees became partners of the company. We have evolved from “employees” to “members of a common cause”, from “working for the company” to “growing with the company”. We will ensure that those who truly create value receive the greatest rewards. HONSOAR is committed to long-term bonding with strivers.This year, we have gained a deeper understanding that safety and responsibility are the prerequisites for all corporate development.We must clearly recognize that safety issues have rebounded, bringing costs and lessons to the company. Safety is not a cost item, but a zero-defect baseline; it is not the responsibility of a single department, but the duty of everyone.In 2026, we will place “safety and responsibility” in a more prominent position:—— Strengthen the awareness of safety red lines, with clear accountability for violations;—— Standardize on-site management, ensuring that hidden dangers are resolved without delay;—— Strengthen the cadre responsibility system, directly linking safety performance with assessment;—— Enhance the full-staff participation mechanism, making everyone a guardian of safety.We will be responsible to our employees, their families, the company and society.This year, a large number of inspiring role models have emerged among our team.Hongshuo Import & Export Department III, Shuyang Sales Department and Hongshuo Import & Export Department I were awarded “Best Sales Teams”;Impregnated Paper Factory and Printing Factory of Kumi Alliance Theater, and Impregnated Paper Factory of Shuyang Theater were honored as “Best Production Teams”;Forty-eight team members received the “Excellent Star” award. They will be our most authentic and powerful role models. The company will vigorously commend them, learn from them and promote their deeds, making “striving for excellence” a habit and a culture.From the bottom of my heart, I want to say: HONSOAR has come this far not because of good luck, but because a group of us have chosen to “work a little more, bear a little more, and persist a little longer”. Many colleagues work overtime for long hours, travel frequently and stick to the front line. During the Spring Festival, some employees remained on duty, attended exhibitions overseas, and some non-Chinese colleagues, despite no holidays in their home countries, kept advancing work as scheduled.The company remembers your dedication, and so does the Board of Directors. I also want to express special thanks to your families behind you.They wait for you with lights on late at night; they hold the family together alone during festivals; they offer understanding and tolerance when our employees feel tired. Half of HONSOAR’s achievements today belong to our employees, and the other half to the dedication of their families.Looking ahead to 2026, the new Board of Directors has set clear guidance: adhere to the overseas strategy, embrace AI and capital, address shortcomings, and promote a younger cadre team. This is not a slogan, but a systematic project that we must firmly advance in the coming years. In 2026, the company’s top strategic priorities will focus on: brand building, breakthroughs in key markets, on-time order fulfillment, inventory control (especially for slow-moving goods), quality improvement, resource integration, standardization, IPD-based R&D, digital application, staffing of key positions, labor productivity improvement and team rejuvenation.The core logic can be summed up in one sentence: Strive for the Future with Competence, Win the Era with Efficiency. Future competition is no longer just about scale, but about capability; not about who is busier, but who is more efficient; not about relying on manpower alone, but on systematic operation. We will build an organization that responds quickly to customers, a system that delivers value steadily, and a team that evolves continuously.In 2026, we will achieve:—— Shorter processes, faster decisions and smoother collaboration;—— Younger, more professional and more capable cadres;—— Deep integration of AI and digitalization into daily work, not just staying on PPTs;—— Every resource invested in value-creating areas.Finally, I would like to share a thought with all of you: in an era of uncertainty, the only certainty is that we must keep improving ourselves. As long as our capabilities, efficiency, team and culture remain strong, HONSOAR will surely navigate through cycles and embrace a more prosperous future.As the Spring Festival approaches, everything takes on a new look. May every member of HONSOAR have a clear direction at work, well-deserved rewards for efforts, warmth in life and strength in heart.Wish you all a happy Chinese New Year, a happy family and all the best!May HONSOAR’s tomorrow be more stable, stronger and brighter!