New beginnings and updates! On this beautiful occasion of bidding farewell to the old and welcoming the new, on behalf of CITIC Titanium Industry Co., Ltd., I would like to extend sincere New Year's greetings to all cadres, employees, and their families, as well as to leaders at all levels and friends from all walks of life who have long cared for and supported the development of CITIC Titanium Industry!

In 2024, there are risks in the market and difficulties to overcome, and "struggle" has always been the unchanging foundation of CITIC Titanium Industry. Faced with a complex market environment, severe industrial situation, and arduous task of turning losses around, under the strong leadership of the Party Committee of CITIC Metal Group, we have risen to the challenge, fearlessly faced difficulties, and bravely overcome challenges over the past year, taking every step with substance and determination. Over the past year, we have climbed hills, fought side by side, and forged ahead, delivering a wise and sweat filled answer sheet through hard work and perseverance.

This year, we adhered to the guidance of Party building, consolidated our hearts and forged our souls to form a joint force. We seize the powerful opportunity of studying and educating on party discipline, strengthen warning education, deepen rectification and discipline, focus on creating a pure political ecology, and provide strong political guarantees for high-quality development. Building a strong grassroots fortress, polishing the party building brand, promoting CITIC culture, from the management to the frontline, all titanium industry personnel, with their deep emotions towards the company and unremitting pursuit of the cause, unite as one, unite as one, and gather into a powerful force to promote the development of the company.

This year, we persisted in breaking through the situation and tackling difficulties, and our business indicators went against the trend to become stronger. Faced with the complex and severe economic situation at home and abroad, intensified competition in the titanium dioxide industry, and multiple pressures of unilateral price decline in the second half of the year, we have always adhered to the three main lines of "differentiated marketing, full process cost reduction, and technological innovation". We have worked hard to improve our internal strength and actively challenged the situation. In the cruel industry reshuffle, we have self innovated and accumulated strength. The annual operating profit and cash flow have both turned from negative to positive, stabilizing the basic business foundation and laying a solid foundation for the next step of breaking through the business situation and high-quality development.

This year, we have adhered to innovation driven approach and comprehensively upgraded our technological research and development. Complete the establishment of the Titanium Dioxide Science and Technology Innovation Center, continuously improve the scientific and technological innovation system, promote the development of "eight new and two excellent" products, complete the research and development of 10 brand products, optimize 3 brand products, achieve the sales of 9 new products, and increase the cumulative sales volume of 11 brand new products by 180% year-on-year. Key technological breakthroughs have been made in customizing high-end automotive paint products, filling the domestic gap and establishing a specialized product system for application fields; Pioneering the development of high-purity titanium dioxide technology, passing provincial project acceptance, and continuously promoting technological breakthroughs and achievement transformation. Won the first prize of CITIC Group Science and Technology Award, the first batch of typical substantive industry university research alliance in Liaoning Province, the national level specialized and innovative "little giant" enterprise, and the Liaoning Province Manufacturing Industry Single Champion.

This year, we have been committed to empowering talents and stimulating vitality through a combination of education and guidance. Launch the "Benchmarking World Class Enterprise Management Series Training" and conduct more than 400 training sessions at all levels and types, effectively promoting the rapid improvement of professional abilities and providing intellectual support for high-quality development. Through various channels such as social recruitment and campus recruitment, we will recruit 30 management and technical talents from various majors to support future development this year. Through organizational selection and internal competition, we will select 12 senior talents and coordinate the construction of various talent teams.

This year, we have persisted in reducing costs through processes and delving deeper into potential areas to improve quality and efficiency. Continuously conducting research and development on titanium dioxide production and quality technology in the production process, optimizing key equipment and process operations, and continuously increasing the internal control qualification rate of titanium dioxide quality indicators. The unit production cost decreased by 20% year-on-year, steam consumption decreased by 15%, and comprehensive energy consumption decreased by 10% year-on-year. The production efficiency continued to improve, and it was awarded the honors of "Annual Energy Efficiency Leader" and "Annual Water Efficiency Leader".

This year, we have been committed to green, low-carbon, and digital intelligent transformation. We firmly establish the concept of green development, actively practice the "dual carbon" strategy, explore new models of green transformation, focus on promoting digital transformation and intelligent development, strengthen energy recycling, and have been awarded the title of "Industrial Product Green Design Demonstration Enterprise".

Prosperity is everyone's carnival, adversity is the paradise of the excellent. In the hopeful and challenging year of 2025, under the strong leadership of the higher-level party committee, we will adhere to technological innovation, transformation and upgrading, implement the core business philosophy of "customer, reputation, cost, and efficiency", continuously optimize product structure, strengthen technological support, and continue to provide high-end chloride titanium dioxide solutions. Enhance development strength through hard work, stimulate endogenous power through reform and innovation, and strive to build the best domestic and world-class titanium dioxide supplier!

Finally, I sincerely wish everyone a happy New Year and all the best! Wishing CITIC Titanium Industry prosperity and thriving business! Wishing the great motherland peace and prosperity!

Ma Yuncan, Head of CITIC Titanium Industry

January 1, 2025