A：In the first half of 2026, the company achieved key breakthroughs in advancing its platform‑based strategy, building a global network, implementing its smart‑factory initiative, and optimizing its capital structure. New‑category businesses, such as electric loaders, have delivered outstanding performance, achieving growth that exceeded expectations. The company’s global footprint continues to deepen, with its overseas operations entering a phase of high‑quality, in‑depth development. Its smart‑manufacturing strategy is being rolled out steadily, solidifying the company’s core competitive advantages for medium‑ and long‑term growth. In addition, the company has successfully attracted strategic investors and spearheaded the establishment of the Guangdong Forklift Industry Association, thereby enhancing its industry standing and unlocking synergies across resources.

A：At present, China’s industrial vehicle industry is undergoing a reshaping of its market structure, with value driving its future development. Against the backdrop of sustained growth, the core of competition has undergone a fundamental shift, moving from low‑price‑driven scale expansion to high‑quality competition centered on value‑based, service‑oriented, and technology‑driven strategies. Leading companies are leveraging their comprehensive strengths to accelerate market share growth, driving increased industry concentration, while the benefits of globalization continue to unfold, significantly accelerating their overseas expansion. Chinese firms are capitalizing on their first-mover advantages in electrification and intelligent technologies to forge new competitive edges on the global stage.

A：In the first half of the year, the company achieved comprehensive growth in revenue, gross profit, and net profit through refined asset management and end-to-end cost control, while its capital structure continued to improve. Operating performance has grown steadily, with continuously improving earnings quality. The core business remains stable while making progress, the business mix has been optimized, and profitability has strengthened accordingly. Both the gross margin and net profit increased year on year, underscoring the sustainability of the company’s business model and the financial soundness of its strategic positioning.

A：In the first half of the year, the company’s platform strategy delivered substantial results, reflected in the synchronized improvement across three key pillars: asset structure, service revenue, and customer quality. The proportion of assets held by third parties further increased to 35.3%, up 3.5 percentage points year on year, as the light‑asset operating model was effectively implemented and the company’s asset management capabilities were strengthened. Revenue from menu‑based services accounted for 30%, up 12.4% year on year, underscoring the company’s ongoing enhancement of service standardization and the concurrent expansion of both the breadth and depth of its customer base. Meanwhile, the revenue retention rate for key accounts has risen to 96.3%, and long-term partnerships with high-value customers have become even more robust, ensuring the continued improvement in the platform’s revenue quality.

A：In the first half of 2026, through refined management and the realization of economies of scale in the remanufacturing system, the company reduced its equipment depreciation expense ratio to 36.6%, a year-on-year decrease of 6.6 percentage points; meanwhile, its overall financing cost ratio declined to 4.5%, down 0.8 percentage points from the previous year. Meanwhile, the continued deepening of our global footprint has resulted in a slight increase in the operating expense ratio by 0.4 percentage points; however, the medium‑ to long‑term scaling and efficiency gains of our overseas operations have jointly laid the foundation for the company’s high‑quality development.

A：As of June 30, 2026, the company’s cash and cash equivalents increased by 30.4% year on year to RMB 219 million, while net cash flow from operating activities amounted to approximately RMB 300 million, up 18.4% year on year. Both saw growth rates that significantly exceeded the revenue expansion, underscoring the company’s quality‑driven growth as well as its strong financial health and operational efficiency.

A：In the face of a complex and volatile market environment, the company will focus on its core strategy, guided by the four transformations—networking, product diversification, internationalization, and intelligentization—underpinned by lean management, while deepening its presence in premium markets, strengthening capability development, and driving high-quality, sustainable growth. Specifically, the company will deepen the development of a globally leading, high-dimensional shared‑ecosystem platform for B2B industrial and logistics equipment, advance a light‑asset operating model, and comprehensively implement its strategy along four key pillars: networking, product diversification, internationalization, and intelligentization.

A：Thank you for your question. Your question is excellent and touches on the very core of our company’s operations and management. While declining forklift rental rates are a widespread market trend, our company has nonetheless achieved an improvement in equipment gross margins. This is not a short-term fluke; rather, it is the result of meticulous planning over several years and a systemic outcome stemming from the synergistic interplay of multiple capabilities.

A：Behind this phenomenon lies the support of the company’s three core competencies. First, the systematic benefits of refined operations continue to unfold; by leveraging remanufacturing capabilities to extend the economic lifespan of equipment, a substantial portion of assets can generate stable rental income even after their depreciation period has ended. Secondly, the company’s independently developed IoT-based smart platform has effectively enhanced asset turnover efficiency and enabled intelligent cross-regional dispatch, thereby increasing fleet utilization rates. Finally, cost control has been continuously strengthened, optimizing the cost structure.

A：As the company’s second core pillar, the loader business is achieving steady and rapid growth on its new strategic trajectory. Since the second half of 2025, the average monthly rental has risen from 6 million to over 13 million, with more than 1,500 units currently in use; in June alone, monthly rentals exceeded 20 million. The incremental growth generated by the new product category has significantly bolstered the company’s overall profitability.

A：The company has successfully achieved two-way empowerment and deep integration across its diverse business lines, including forklifts and loaders. For example, among maintenance customers, 24.7% also purchase the defined services concurrently, while among forklift customers, 18.4% additionally subscribe to maintenance and repair services, creating a mutually reinforcing, customer‑shared virtuous cycle that significantly enhances customer value.

A：The company’s operating cash flow is robust, and its cash reserves are sufficient to meet both day-to-day operations and expansion needs; therefore, it is not short of funds. However, to seize the opportunity presented by the rapid growth of its loader business, the company opted to issue new shares, raising over HK$87 million. The funds are mainly used for electric equipment layout, offline no-point encryption, supplementary daily operations and digitalization and AI upgrading, while the introduction of state-owned background shareholders Chunhe also brings industrial resources and local policy support, which is conducive to the company's long-term strategic layout and medium-and long-term development.

A：We chose Xiaogan because of its advantageous geographic location as a central logistics hub, its dense concentration of surrounding enterprises, and the robust, sustained demand for intralogistics equipment. In addition, the loader operation with Xiaogan as a pilot can achieve global optimization, efficiently radiate the major economic regions of the country, and the participation of Chunhe has brought capital and all-round resource support for cooperation, while the endorsement of state-owned capital makes the local operating environment more smooth and efficient.

A：This cooperation is not only financial investment, but also the deep binding of industrial capital and local resources. Through the cooperation with Xiaogan, the company has not only obtained the industrial ecology of the industry leader, but also established an operating fulcrum and resource depression based in central China and radiating the whole country, achieving mutual benefit and win-win, two-way empowerment.

A：Although the fine-tuning of the equity ratio will lead to price dilution per share, shareholders believe that the increase is in exchange for the fastest-growing and highest-margin electric equipment business investment, encrypted service networks, upgraded digital capabilities, all of which have clear output expectations. Therefore, despite the short-term profit dilution, in the long run, through this fixed increase, the cake will be bigger, and the corresponding profit and net assets per share will have room for sustained growth.

A：The company's investment in ESG is not a cost item for compliance requirements, but rather a strategic layout that is considered fundamental to the operation and can be directly accounted for and enhance performance. Specific measures include large-scale remanufacturing, comprehensive electrification upgrade, and full-scene intelligent operation. These measures not only conform to the national policy direction of circular economy and popularization of new energy equipment, but also have a positive impact on the company's performance. It is an investment that can also make money by spending money. The company's investment in ESG is not a simple cost item, but through environment-friendly equipment upgrading and management strategies, such as large-scale remanufacturing, comprehensive electric upgrading and full-scene intelligent operation, it can not only reduce operating costs, improve equipment efficiency, but also create additional profits, so it is a profit item that can directly bring economic benefits.

A：In our Frans, esg is not an independent cost calculation, but our profit grip. Remanufacturing helps us control costs, electrification brings high gross margin space, and smart operations improve customer repurchase and retention rates to ensure profit sustainability. S as the foundation of development, stable team to save reputation, improve efficiency. We speak through the data in the financial report, such as the profit contributed by manufacturing, the gross profit of electric equipment, the customer repurchase rate and retention rate brought about by intelligent operation, and the shortening of the network preparation cycle.

A：The company can make money quickly in Southeast Asia because of its unique strategy and business model. Different from traditional enterprises looking for new markets and customers, Frans has already deeply coordinated the strategic layout of core customers in the layout, accurately positioned around the customer's factory, relying on the service efficiency and system capability accumulated in China, gained the long-term trust of existing core customers in advance, and realized the inevitable result of orders and profits. This model has been validated by the successful experience of Vietnamese outlets and can be replicated across regions. In the next 3 to 5 years, overseas business will become the company's second growth pole. With the industrial transfer and market expansion of countries along the Belt and Road, the overseas market will release a huge development space of hundreds of billions. At present, a number of outlets have landed and operated well, the follow-up plan to encrypt the layout of outlets, match customer needs, form a virtuous circle, and steadily grow into a growth engine that keeps pace with domestic business.