Gree Electric Appliances, Inc. of Zhuhai

2024 Annual Report

April 2025

Section I Important Notice, Contents and ParaphraseThe Board of Directors, Board of Supervisors, directors, supervisors, and senior executives ofthe Company hereby guarantee that the contents are authentic, accurate, and complete, withoutfalse records, misleading representations, or material omissions in the Annual Report, and shalltake all the joint and several legal liabilities.Dong Mingzhu, the Company's responsible person, Liao Jianxiong, the responsible person incharge of accounting work, and Liu Yanzi, the Accounting Department's responsible person(accounting superintendent), hereby declare and warrant that the financial report in theAnnual Report is authentic, accurate, and complete.All the directors have attended the meeting of the Board of Directors in respect of thedeliberation of the Annual Report.The forward-looking statements, such as future plans and development strategies in the AnnualReport, do not constitute a substantive commitment of the Company to investors. Investors andrelevant parties should therefore make rational investments based on an awareness of riskfactors attendant in investment and understand the differences between plans, forecasts andcommitments.The Company's profit distribution proposal passed upon deliberation at the meeting of theBoard of Directors is set out as below: Based on the total share capital of 5,585,138,741 sharesenjoying profit distribution rights at the time of disclosure of this profit distribution plan (thetotal stock capital of 5,601,405,741 shares excluding the 16,267,000 shares held in therepurchase account of the Company), the Company plans to distribute all shareholders a cashdividend of CNY20 (tax included) per 10 shares, but does not plan to give any bonus share (0share, tax included) or convert any capital reserves into share capital. If there is a change in thetotal share capital of the Company entitled to profit distribution from the date of disclosure ofthis distribution plan to the date of implementation of equity distribution registration, theCompany will adjust the total dividend amount accordingly based on the principle of keepingthe distribution ratio per share unchanged.

Contents

Section I Important Notice, Contents and Paraphrase ...... 2

Section II Company Profile and Main Financial Indicators ...... 6

Section III Management Discussion and Analysis ...... 11

Section IV Corporate Governance ...... 62

Section V Environmental and Social Responsibility ...... 86

Section VI Important Matters ...... 107

Section VII. Changes in Shares and Shareholders ........................................................................................... 136

Section VIII Preferred Share Information ...... 148

Section IX Bond Information ...... 149

Section X Financial Statements ...... 150

References

(I) The accounting statements signed and sealed by Dong Mingzhu, the legal representative, LiaoJianxiong, chief accountant and Liu Yanzi, head of accounting department.(II) The original audit report sealed by Union Power Certified Public Accountants (Special GeneralPartnership) with signatures and seals of certified public accountants Qiu Yiwu and Wang Huijun.(III) Originals and original drafts of all the Company's documents and announcements published onthe media and CNINFO designated by the Company within the report period.

Paraphrase

Section II Company Profile and Main Financial IndicatorsI. Company information

II. Contacts and contact information

III. Information disclosure and place of the report

IV. Alteration of registration

Unified Social Credit Code

V. Other related informationAccounting firm engaged by the Company

Sponsor engaged by the Company to perform continuous supervision during the report period

□ Applicable ?Not Applicable

Financial adviser engaged by the Company to perform continuous supervision during the report period

□ Applicable ?Not Applicable

VI. Main accounting data and financial indicatorsWhether the Company has retroactive adjustment or restatement of previous accounting data

□ Yes ?No

and losses (CNY)

The net profits of the Company before and after deducting non-recurring profits and losses in the last three fiscal years, whichever islower, is negative, and the audit report of the last year shows that the Company's ability to continue as a going concern is uncertain

□ Yes ?No

The net profits before and after deducting non-recurring profits and losses, whichever is lower, is negative

□ Yes ?No

VII. Accounting data differences under domestic and foreign accounting standards

1. Differences in net profits and net assets in the financial report disclosed under the internationalaccounting standards and that disclosed under the domestic accounting standards

□ Applicable ?Not Applicable

There was no difference in net profits and net assets in the financial report disclosed under the international accounting standards andthat disclosed under the domestic accounting standards during the report period.

2. Differences in net profits and net assets in the financial report disclosed under the overseas accountingstandards and that disclosed under the domestic accounting standards

□ Applicable ?Not Applicable

There was no difference in net profits and net assets in the financial report disclosed under the overseas accounting standards and thatdisclosed under the domestic accounting standards during the report period.

VIII. Quarter-based main financial indicators

Currency: CNY

to shareholders oflisted companies afterdeduction of non-recurring profits andlosses

Whether major differences exist between the above financial indicators or their sum and those in the disclosed quarterly report andsemi-annual report

□ Yes ?No

IX. Non-recurring profit and loss items and amounts?Applicable □ Not applicable

Currency: CNY

above items

Details of other profit and loss items conforming to the definition of non-recurring profits and losses:

?Applicable □ Not applicable

Currency: CNY

Description of defining the non-recurring profit and loss items listed in the Explanatory Announcement No. 1 on InformationDisclosure for Companies Offering Their Securities to the Public - Non-recurring Profits and Losses as recurring profit and lossitems

□ Applicable ?Not Applicable

No non-recurring profit and loss items listed in the Explanatory Announcement No. 1 on Information Disclosure for CompaniesOffering Their Securities to the Public - Non-recurring Profits and Losses were defined by the Company as recurring profit and lossitems.

Section III Management Discussion and AnalysisI. Industry situation of the Company during the report period

1. Consumption field — stable growth in the home appliance industry and sustainable growth in the airconditioner marketIn 2024, China’s economy maintained an overall recovery and positive trend. Policies promoting the consumption economy’s largecirculation accelerated the release of updated demand and further stimulated the market’s consumption potential. According to datafrom AVC, the retail sales of all home appliance categories in China (excluding 3C products) reached CNY907.1 billion in 2024,representing a year-on-year growth of 6.4%.In March 2024, the state officially launched the “Large-scale Equipment Renewal and Consumer Goods Trade-in” action plan. In lateJuly, the central government further increased its support, clearly stating that it would provide trade-in subsidies for consumerspurchasing eight types of home appliances, including air conditioners, refrigerators, and washing machines, that meet or exceed thesecondary energy or water efficiency standards. The subsidy rate is 15% of the product’s sales price. For products that meet or exceedthe primary energy or water efficiency standards, an additional 5% subsidy will be provided to promote the upgrading of homeappliance consumption. From August to September, local governments successively introduced supporting policies, and the policyeffects continued to be released, with the consumer market showing a recovery and improvement trend. Driven by the trade-in andfiscal subsidy policies, the domestic sales volume of white goods in the fourth quarter increased significantly quarter-on-quarter. Datafrom the National Bureau of Statistics shows that the annual production of air conditioners, washing machines, and refrigeratorsincreased by 9.7%, 8.8%, and 8.3% respectively, indicating a continuous recovery in the home appliance consumption market.

2. Industrial sector — production shows a sustained recovery trend

Data from the National Bureau of Statistics indicates that in 2024, China’s large-scale industrial enterprises achieved operating incomeof CNY137.77 trillion, representing a year-on-year growth of 2.1%. The industrial economy is demonstrating a sustained recoverytrend.The industrial scale of air conditioner core parts and components increases significantly. According to data from ChinaIOL.com, in2024, the overall scale of the rotor compressor market reached a new high, with an annual sales volume of nearly 300 million units,representing a year-on-year growth of 13.7%. In the domestic market, the sales volume was approximately 251.69 million units,increasing by 11.9% year-on-year; in the export market, the sales volume was about 44.88 million units, growing by 24.8% year-on-year. Benefiting from the growth in the sales scale of the downstream air conditioner market, the domestic sales volume of airconditioner motors was approximately 396 million units, increasing by 13% year-on-year; the export volume was about 92 millionunits, growing by 28.9% year-on-year.The scale of the intelligent manufacturing equipment industry is growing. The Development Plan on Smart Manufacturing During the“14th Five-Year Plan” takes the development of advanced intelligent manufacturing industry as the core goal to overall arrange andplan the promotion of manufacturing power. At present, China has formed an intelligent manufacturing industry system representedby automated production lines, intelligent detection and assembly equipment, intelligent control systems, industrial robots, etc., andthe scale of the industry is growing. According to data from INSIGHT AND INFO, the market size of China's intelligent manufacturingequipment was CNY3.4 trillion, representing a year-on-year growth of 6.3%. Data from the China Machinery Industry Federationshows that the output of industrial robots in 2024 was 556,000 units, increasing by 14.2% year-on-year. According to data from theZhongshang Industry Research Institute, the scale of the CNC machine tools exceeded CNY430 billion, with a year-on-year growth ofapproximately 5.7%. With the advancement of technology and the coordinated development of industries, the industrial chains of CNCmachine tools and industrial robots will continue to expand and deepen, becoming the core driving force for industrial transformationand upgrading.

II. Major businesses of the Company during the report periodGree Electric Appliances, Inc. of Zhuhai is a diversified and technological global industrial group and has three major consumer brandsof GREE, TOSOT and KINGHOME, and industrial brands of LANDA, Kaibang, and Xinyuan. Its industry covers two major areas ofhousehold consumer goods and industrial equipment. In the consumption field, it covers residential air conditioners, HVAC,refrigerators, washing machines, water heaters, kitchen appliances, environmental appliances, smart buildings, and smart homeappliances. In the industrial sector, it covers high-end equipment, precision molds, freezers and refrigeration equipment, motors,compressors, capacitors, semiconductor devices, precision casting equipment, basic materials, industrial energy storage, renewableresources, etc. So far, GREE products have served more than 190 countries and regions around the world, and continue to meet people'sneeds for a better life.During the report period, GREE’s sales of central air conditioners remained the largest in the industry. According to the “2024 ChinaCentral Air Conditioner Industry Development Report” released by ihos’s “HVAC & Heat Pump” magazine, GREE achieved the topsales volume in the domestic central air conditioner market with a market share of over 15%, leading the market for 13 consecutiveyears.During the report period, GREE continuously enriched its product categories. Multiple categories of its home appliances were highlyfavored by the market, with its retail sales and volumes ranking among the top in the industry. According to data released byEuromonitor, GREE ranked first in the global retail volume of split air conditioners in 2024. Data from AVC shows that in 2024,GREE’s share of online retail sales of residential air conditioners was 25.40%, ranking first in the industry; its share of online retailsales of electric fans was 13.01%, ranking second; its share of online retail sales of electric heaters was 9.66%, ranking third; and itsshare of online retail sales of air source water heaters was 17.45%, also ranking third in the industry.In the future, the Company will continue to take “promoting the industrial spirit, mastering core technologies, pursuing perfect quality,providing first-class services, Made in China, Loved by the World” as its mission, and steadily move forward towards the realizationof its corporate vision of “building a world-class enterprise and making GREE a century-old brand”.III. Core competence analysis

The Company adheres to independent innovation, breaks through core technologies, focuses on consumer demands, providesprofessional services, leads industry development, and jointly creates a better life for humanity.(I) World-famous brand, continuing to create value for the societyGREE is a diversified technological global industrial group integrating R&D, production, sales and service. Over the years, theCompany has successively won numerous honors such as “China World-famous Brand”, “Most Competitive Brand in the Market”,“National Quality Award”, “Enterprise Exempted from Export Inspection”, “China Brand Innovation Award”, “Top 100 Scientific andTechnological Enterprises in China's Light Industry”, and “Top 500 Creditworthy Enterprises in China”.During the report period, the Company was once again listed on Forbes “Global 2000”, made it onto the “2024 China's Top 500 PrivateEnterprises List”, and was included in the “2024 World IoT 500 Golden List”, receiving multiple honors including the “Global BusinessContribution Award”. It was also selected for the “2024 China’s Top 100 Overseas Brands Index” and the “People’s CraftsmanshipBrand” list. In the “2024 China Brand Value Evaluation Information”, it ranked first in the home appliance industry of the light industrygroup with a brand value of CNY188.253 billion.GREE adheres to the core values of quality first, customer satisfaction, honest operation and win-win for all parties. It builds andestablishes its brand with perfect quality and world-leading technology, and continuously creates value for society and consumers.(II) Outstanding R&D capabilities demonstrate an industry leading roleThe Company adheres to the principle of “independent research and development of core technologies”, builds a multi-level and high-level R&D platform system relying on national-level scientific research platforms, and forms a technological innovation system that is“enterprise-oriented, market-driven, and combines industry, academia, and research”. It continuously overcomes key core technologiesand leads the development of the industry.

The Company has the world’s largest air conditioner R&D center, with 16 institutes, 152 research institutions, 1,411 laboratories, and1 academician workstation (electric motor and control). It also has one National Engineering Technology Research Center, one State-level Industrial Design Center, one State Recognized Enterprise Technology Center, and one Robot Engineering Technology R&DCenter. At the same time, it has become the research and evaluation base for refrigeration equipment of the National NotificationEnquiry Center and the national standard verification point for energy conservation of refrigeration equipment. As of the end of 2024,the Company has cumulatively won 2 National Science and Technology Progress Awards; received a total of 122 important awards atthe national, provincial, and industrial levels, and has possessed 46 “World Leading” technologies; has applied for 129,524 patents,including 70,884 invention patents; has obtained 25,883 invention patent grants, making it the only home appliance enterprise to enterthe top ten in China's invention patent grants for 9 consecutive years; has won 81 Chinese patent awards, including 3 gold awards forinvention and 4 gold awards for appearance; and has got 15 gold awards of International Exhibition of Inventions of Geneva and 12gold awards of iENA. At the same time, the Company is one of the first batch of national enterprise intellectual property demonstrationunits, “National Patent Operation Pilot Enterprise”, and won the China Trademark Gold Award. The Company’s steady increase in thenumber and quality of patents fully demonstrates GREE’s invention and creation capabilities and international leading research anddevelopment strength to the world.(III) Leading PQAM mode, achieving “Made in China, Loved by the World”The Company adheres to the quality policy of “pursuing perfect quality, establishing an international brand, and building a century-old enterprise”. It always prioritizes quality and is guided by the pursuit of perfect quality. Through continuous innovation, it enhancesproduct quality to give back to consumers.Innovation drives quality management. GREE’s quality model sets an industry benchmark. Since 2012, the Company has vigorouslycarried out quality management innovation, method innovation and theoretical innovation, deepened the construction of a quality-strong enterprise, and proposed the forward quality-driven “Five-step Quality Prevention Method” and the reverse quality-driven “D-CTFP Quality Technology Innovation Cycle” methodology; with the T9 comprehensive quality control model and PQAM (perfectquality assurance model) as the core framework, it has established a unique GREE “perfect quality” management model, and won thethird “China Quality Award” in 2018. In March 2021, the Company launched a “ten-year free repair” policy for residential airconditioners, which is the longest repair period promised by the Chinese residential air conditioner industry to date. It is also an upgradeof the service quality since GREE was the first in the industry to introduce the “six-year free repair” policy for residential airconditioners in 2005, and it is a demonstration of the strength of GREE air conditioners in leading the industry service standards.The Company adheres to the original intention of “taking consumer demand as the highest standard” and contributes to the high-qualitydevelopment of Made-in-China products with the spirit of “conduct self-examination”. In 2019, the Company’s quality technologyinnovation cycle D-CTFP was elevated to the national standard Quality Management - Innovation Cycle Guide Based on CustomerDemand (GB/T 38356-2019). In 2023, the book “Pursuing Perfection - Innovation & Progress: GREE Quality Model”, co-authored byGREE and South China University of Technology, was selected for the “Best Quality Practices in China in the 21st Century” seriespublished by Standards Press of China. During the report period, the Company once again received the two highest honors in its field,“Enterprise Market Quality Credit AAA Level” and “Five-Star User Satisfaction Benchmark Enterprise”, awarded by the ChinaAssociation for Quality, demonstrating consumers’ recognition of GREE’s high-quality products and showcasing GREE’s strongstrength as a leading player in the industry.Through continuous innovation and outstanding management, GREE has set an industry benchmark with its “Perfect Quality”management model, demonstrating the absolute advantage of “Made in China”. In the future, we will continue to take “pursuing perfectquality” as our responsibility and “satisfying users” as our goal, to win global admiration for “Made in China”!(IV) The full series of home appliances, providing consumers with a high-quality living environment

GREE’s products cover a full range of home appliances, including residential air conditioners, HVAC systems, refrigerators, washingmachines, water heaters, kitchen appliances, and environmental appliances, fully meeting consumers’ comprehensive needs for a high-quality living experience. During the report period, the Company adhered to the principle of user demand-oriented and launched a

series of new home appliances, including AI Savenergior Air Conditioner, Cool Comfort-II Energy-saving Air Conditioner, UltimateRefresh Air Conditioner, Pure Fresh Air Conditioner, residential central air conditioners with Gentle Air Comfort technology, Pularand Charmo series of photovoltaic storage air conditioners for tropical regions, All-round Freshness Preservation series refrigerators,“Zhenrou” series washing machines, high-efficiency heat exchange series gas water heaters, instant heating wall-mounted pipelinewater dispensers, stove range hood sets, air circulators, air cooler, new tower-type warm air fans, and new humidifying skirting boards,providing consumers with a high-quality home living environment.The Company has deepened its layout in areas such as the whole-house intelligent system, the whole-house communication architecture,intelligent voice interaction, and the intelligence of home appliances, achieving the construction of a “Healthy Home” from individualsmart products to the entire smart home appliance ecosystem. The Company takes “A Better Life, One Step Ahead” as its core conceptand independently created the IoT platform, intelligent decision-making system, G-Voice voice interaction system, intelligent visionsystem, G-OS IoT operating system, G-Learning comfort and energy-saving algorithm and other intelligent IoT technologies. It haslaunched a series of smart home products and formed a smart home solution covering five systems: energy, air, health, security andlighting. It has achieved a leap from “GREE, Making Better Home Appliances” to “Smart life, Created by GREE”, andcomprehensively and systematically created a healthy and intelligent home environment.(V) A new retail system under autonomous control, meeting consumers' new demands through digitalizationThe Company is committed to building an independent, controllable, mutually beneficial and win-win channel system. By continuouslypromoting the innovation of the new retail marketing system, it has formed a dual-line integrated sales network covering the wholecountry. Through the in-depth application of digital technology, the Company continuously enhances channel efficiency, achieving awin-win situation for the enterprise, distributors and consumers.The Company has established a nationwide dual-channel integrated sales network through 30 regional sales companies across thecountry, over 30,000 offline outlets, its own online platform and official flagship stores on third-party e-commerce platforms, furtherstrengthening its channel retail capabilities and market service capabilities. It has also set up a unified national marketing and inventorymanagement plan to enhance the transparency and controllability of channel management, reduce channel inventory, optimize logisticscosts and improve channel operation efficiency. The Company is actively creating an offline experiential shopping environment andhas launched a new channel strategy brand, “Dong Mingzhu Healthy Home”, integrating multiple categories of home appliances tomeet consumers’ diverse needs and provide comprehensive and high-quality home life solutions for them.Digitalization empowers new advantages in channel management. By building an advanced digital information system, the Companyhas achieved full-process digitalization from procurement and logistics to sales and services, enhancing overall efficiency. Digitaltechnology improves the timeliness of sales information for dealers, facilitating precise decision-making and efficient implementation,and further enhancing the service efficiency of dealers and inventory turnover rate. Digital means make the Company's terminalbusiness situation visible, enhancing user stickiness; through the digital upgrade of terminal stores, it deepens the flattening reform ofthe channel, improves operational efficiency, continuously improves the shopping experience of consumers, and further consolidatesthe Company's market position.(VI) Scientific production capacity layout and leading intelligent manufacturing level to respond to marketdemand flexiblyThe Company scientifically arranges its production capacity distribution based on factors such as the market demand characteristics ofdifferent products and the differences in regional production factor endowments. By the end of 2024, the Company had established 77production bases in multiple provinces and cities including Guangdong, Chongqing, Anhui, and in countries such as Brazil, coveringair conditioners, home appliances, industrial products, etc., achieving industrial agglomeration and highly coordinated development ofthe upstream and downstream industrial chains. The Company, guided by the principles of serving the market, overall planning, localproduction, and regional collaboration, and following the allocation principles of economic transportation and balanced production,arranges the production capacity of each base to promote the optimal benefits. Meanwhile, the Company has established 6 recycling

resource bases, covering the entire industrial chain from upstream production to downstream recycling, and has achieved a green,circular and sustainable development model.With the goal of enhancing the operational efficiency of the entire production process, the Company fully integrates advancedtechnologies such as industrial robots, CNC machine tools, 5G, and AI into its production scenarios, striving to build and cultivateleading demonstration factories in the industry. By the end of 2024, the Company had been awarded a total of 2 national-level intelligentfactories, 3 national-level 5G factories, 9 national-level green factories, and 8 national-level industrial internet pilotdemonstrations/application cases, fully demonstrating the Company's leading position in the field of intelligent manufacturing.Precise production capacity layout and leading intelligent manufacturing level further enhanced GREE's manufacturing and costadvantages, realized the rapid response to market demand and brought high-quality life enjoyment to consumers.(VII) With strong self-research and self-made ability of core components, the comprehensive competitivenessof products continues to lead the industry

The Company possesses strong capabilities in core component research and development as well as manufacturing. It has subsidiariessuch as Landa Compressor, Kaibang Motor, Xinyuan Electronics, Gree Electric, and Gree Mold. It leads the industry in terms ofproduction capacity, technology and quality, and has successively won honors such as the "National Quality Award", "National QualityBenchmark", "Top 100 Enterprises in China's Electronic Components Industry", "National Intellectual Property Advantage Enterprise","Guangdong Famous Product", and "Guangdong Provincial Enterprise Technology Center". It has established key industryexperimental and testing centers and research centers such as the "National CNAS Testing Center", "Guangdong ProvincialEngineering Technology Research Center for Key Electronic Components", "Guangdong Provincial Engineering Technology ResearchCenter", and "Guangdong Provincial Intelligent Mold Technology Innovation Center", demonstrating the Company's hard power andbrand influence in industrial product development.The Company's independently developed products, including the two-stage enthalpy-increasing compressor, three-cylinder two-stagevariable displacement compressor, rare-earth-free main drive motor system, high-performance linear servo motor and driver, high-performance servo motor and driver for industrial robots, and magnetic levitation motor drive system, have all received the "WorldLeading" technology certification. The CD294W large ripple aluminum electrolytic capacitor with welded plates has been shortlistedfor the 2024 AWE Award. The Company has a comprehensive grasp of the advanced technology of core components and continuouslyconsolidates its leading position in the market.GREE has strong R&D capability of core components and excellent processing and manufacturing capability. The GA-UHD500horizontal machining center from GREE adopts a stepped column lightweight and high-rigidity structural design, breaking through thetechnical challenges of high speed and high precision. Its maximum feed rate reaches 60 m/min, with a minimum division of 0.001°.The positioning accuracy and repeatability of the equipment are 0.006 mm and 0.004 mm respectively, and the efficiency is increasedby more than 15% compared with the same type of equipment. It meets the high-quality processing requirements of core components.The powerful R&D and manufacturing capabilities of core components ensure the extremely high degree of autonomy andcomprehensive competitiveness of the Company's products, providing strong support for the Company's continuous and stabledevelopment and guaranteeing that the Company's products always remain at the leading position.(VIII) Refine the cost control system and continuously enhance the competitiveness of productsThe Company adheres to the customer demand-oriented approach, combines its business goals, and establishes and improves the costcontrol system. It deepens the cost control of products, implements value chain analysis, and through the decomposition and analysisof the impact of the input, transformation and output of costs in each business link inside and outside the group on the final value ofthe product, it improves operations and reduces costs accordingly, thus forming a sustainable competitive advantage.Supply chain integration promotes cost reduction on a large scale. The Company implements a centralized procurement policy,continuously expands its layout in the upstream and downstream of the industrial chain, actively builds strategic partnerships withleading enterprises in the industry, continuously optimizes the supply chain structure, integrates and utilizes high-quality supply chainresources, and is committed to achieving a win-win situation for all parties. The Company continuously deepens its cooperative

relationship with high-quality suppliers, shares resources, and strives to maximize the interests of both parties, achieving mutual benefitand win-win results.Digital technology drives cost reduction across the entire value chain. The Company continuously increases the application of digitaltechnology in its operation and management, achieving digital control over the entire chain from product research and development,procurement, production to sales, and promoting optimization throughout the product life cycle and the entire manufacturing process,as well as overall cost reduction.Continuous innovation leads to cost reduction in product technology. The Company has further enhanced material utilization andaccelerated the generalization of materials by improving product structure design, optimizing process links, and developing lean models,achieving a sustained decline in costs.(IX) A well-developed system for cultivating independent talents to ensure a high-quality supply of humanresourcesGREE always adheres to the principle of "focusing on the strategic layout of the Company and adhering to independent training oftalents" and gradually forms an independent talent training mode with an independent talent introduction channel, independent trainingand development mechanism and all-round incentive and guarantee system as the core based on the development experience andcultural deposit of the Company, striving to make employees and the Company make progress and develop together.The Company has established a systematic "selection, cultivation, utilization and retention" independent talent training system. Itattaches great importance to introducing outstanding talents from universities. Through various forms such as employer brandcharacteristic activities, university-enterprise co-construction of characteristic courses and campus recruitment fairs, it recruitsprofessional talents who recognize the Company's corporate culture and have high quality. It always regards talent cultivation as animportant strategic resource for the development of the enterprise. By building a learning organization, it promotes the inheritance ofmanagement experience, the sharing of R&D technology and the improvement of skills and qualities. For key groups, it organizes andconducts "Cornerstone Plan" supervisor training camps, "Spark Plan" team leader training camps and college student talent trainingprojects, providing all-round and multi-level training support for employees. It continuously strengthens the talent evaluation andselection mechanism to provide strong support for talent identification. It also enhances talent care, enabling employees to share thedividends of the Company's development through employee stock ownership plans, talent subsidies, talent housing and other aspects,thereby improving employee satisfaction and happiness.By the end of 2024, the Company had been awarded 2 National Ten Thousand Talents Program Leading Talents in Science andTechnology Innovation, 4 experts enjoying special government allowances from the State Council, 4 advanced basic process talentsfrom the MIIT, 1 national leading talent in intellectual property, 1 national technical expert, 1 outstanding contribution award in SouthGuangdong, 2 young outstanding talents under the Guangdong Special Support Program, 76 high-level talents in Zhuhai, 390outstanding young talents in Zhuhai's industries, 14 Guangdong Provincial Technical Experts, 2 Nanyue Technical Experts, 17 ZhuhaiMunicipal Technical Experts, 16 Zhuhai Municipal Chief Technical Experts, 14 Zhuhai Special Artisans, and 341 Zhuhai Artisans.The Company's strong capabilities in talent cultivation lay a solid foundation for its long-term development.

IV. Analysis of main business

1. Overview

The Company, with the vision of "building a world-class enterprise and establishing a century-old brand of GREE", relies on theenterprising and pioneering spirit of all GREE employees to forge ahead and overcome challenges. In 2024, the Company achieved atotal operating revenue of CNY190.038 billion; the net profit attributable to the parent company was CNY32.185 billion, representinga year-on-year growth of 10.91%, with its profitability continuously improving.(I) Focus on market demand and continuously provide users with innovative consumer products.

1. Residential air conditioner sector

During the report period, the Company focused on "energy conservation and low carbon, comfort and health, and personalization andintelligence" to upgrade its residential air conditioners, creating a new generation of high-performance, healthy and intelligentresidential air conditioner products.In terms of energy conservation and efficiency, the Company has launched a series of wall-mounted air conditioners such as "CoolComfort-II" and "Savenergior". These products are designed to meet the high standards of green and energy-efficient operation,integrating key technologies for low-carbon dynamic operation of inverter air conditioners, energy-saving control technologies basedon artificial intelligence algorithms, and highly applicable AI chips, effectively enhancing the dynamic energy efficiency throughoutthe year. Based on the number of air conditioners sold in this series, it is estimated that about 308 million kilowatt-hours of electricitycan be saved each year, and about 306,700 tons of CO

emissions can be reduced, truly achieving energy conservation and carbonreduction in the operation of air conditioners.In terms of comfort and health, the Company has launched fresh air conditioner series such as "Ultimate Refresh" and "Pure Fresh".These products focus on users' demands for low-noise and high-efficiency fresh air replacement, as well as bacteria removal andpurification. They are equipped with technologies like low-noise and large fresh air volume, and high-efficiency water condensationpurification and bacteria removal, achieving professional-level air circulation, purification and bacteria removal. With low noise andlarge fresh air volume, they significantly enhance users' experience of using the fresh air function.In terms of personalized intelligence, the Company has launched the "Pure Air" floor-standing air conditioner, which is equipped withmillimeter-wave radar technology. It intelligently monitors the situation of people in the area and adjusts the air supply of the airconditioner accordingly, achieving the intelligent and flexible "wind avoids direct blowing people and follows people". It can alsointelligently detect when users leave the area and automatically turn off the air conditioner, eliminating the trouble of forgetting to turnit off and providing consumers with a more intelligent, worry-free, comfortable experience.In response to the environmental protection requirements of the EU region, the Company has independently developed active andprecise detection technology, full-system collaborative control leakage prevention technology, and high-precision regulationtechnology of the unique electronic expansion valve for R290. It has launched a new series of residential air conditioners with R290eco-friendly refrigerant, achieving safe, reliable and efficient operation within a wide temperature range from -25°C to 50°C. TheSEER reaches A+++, and the SCOP reaches A++. It has been successfully launched in many countries and regions in Europe, Africaand others. In response to the high-temperature environment in tropical regions, the Company has developed the Pular and Charmoseries products suitable for different areas. These products integrate technologies such as stepwise heat exchange parallel compressionrefrigeration, photovoltaic direct drive, and energy storage, achieving efficient and stable cooling under high-temperature conditionsand solving the problem of cooling demands in high-temperature environments.

2. HVAC equipment sector

The Company's HVAC sector covers over a thousand categories of 13 major series, including centrifugal chiller, VRF, screw chiller,chiller, unit chiller, household chiller, and precision air conditioner, which, by continuously upgrading product technology, can meetthe application demands of different working conditions, scenarios, and industries, and serve major benchmarking projects.Residential central air conditionerIn response to the long-standing industry pain points such as poor heating efficiency and cold air blowing directly onto people intraditional air conditioners, the Company has innovatively extended the "Gentle Air Comfort" technology from the residential airconditioner field to the residential central air conditioner field, and launched the central air conditioner with gentle air comforttechnology. The product adopts the industry's first reversible air supply technology, which ensures that the air does not blow on peopleduring cooling and quickly warms up the human activity area in the room during heating. The vertical temperature difference in theroom is as low as 0.11°C, keeping people in the most comfortable zone.In response to consumers' demands for comfort and weather resistance of residential air conditioners, the Company has launched the"Smart Comfortable Home" central air conditioner system for homes based on years of technological accumulation. The product isequipped with temperature and humidity balance technology, enabling intelligent adjustment; it is combined with an air purificationfunction to meet customers' health demands; it adopts a brand-new sand-textured black appearance and standard golden anti-corrosionfins, effectively resisting daily wind and rain erosion.In response to the problems of traditional water floor heating systems, such as freezing in winter and large pipe diameters that occupyfloor height, the Company has launched the "Yuxiang" dual-purpose central air conditioner system for home use that combines ceilingand floor heating. The product adopts fluorine floor heating, with capillary copper tubes as the heating pipes, which have a diameterof only 4 mm, effectively saving floor height. Meanwhile, the entire system is designed without water, eliminating the risk of freezingin winter. The product is equipped with the world's leading intelligent predictive control technology, which reduces room temperaturefluctuations and saves over 30% of energy in actual operation. At the same time, it undergoes functional upgrades, featuring body-sensing control and self-cleaning functions. It meets the demands of three-dimensional heating in winter, cooling in summer, andtemperature control and dehumidification in the high-humidity transitional seasons, achieving precise regulation of indoor temperatureand humidity throughout the year and fulfilling the comfort requirements.In response to the limited installation space issue for modern green buildings, the Company has launched a full range of "GMV ES"

high-capacity side discharge VRF, with the maximum cooling capacity increased to 68.5 kW. The floor space occupied by the productis 45% less than that of the same cooling capacity top discharge VRF. It does not require the operation of a large hoisting machine. Asingle outdoor unit can support up to 40 indoor units, reducing installation difficulty and cost, and meeting the usage requirements ofmore installation scenarios.In response to consumers' demands for indoor air purification and low maintenance costs of equipment, the Company has launched the"SelectAir" DB series of full heat exchange fresh air purifiers. The product features a high-molecular washable core, achieving "zeroconsumables" for the core. It is equipped with an air quality detection device inside, making air quality visible. The PM2.5 and carbondioxide concentration parameters can be viewed through the wire controller. It adopts a four-layer purification and antibacterial filtercombined with ion sterilization technology, effectively removing formaldehyde, purifying PM2.5 and eliminating bacteria.In response to the challenges of on-site energy efficiency detection and regulation for commercial VRF in large buildings, the Companyhas conducted research and development in areas such as real-time performance calculation technology, flexible refrigerant regulationtechnology, and full-scenario AI energy-saving technology. It has launched the "AI Wide-range Energy-saving" GMV9 Zhiyue seriesVRF, which is the first in the industry to achieve an online measurement accuracy of indoor unit capacity of ≥90%, real-time powerconsumption measurement accuracy of the unit of ≥95%, and an average energy-saving rate of 25%. This technological achievementwas appraised by the Appraisal Committee of China Machinery Industry Federation as being at the "World Leading" level.

Commercial air conditioner

In response to the energy efficiency demands in public buildings, rail transit, data centers and other fields, the Company has conductedresearch in the directions of screw compressor structure design and high-precision control, and launched a new generation of two-stagepermanent magnet variable frequency screw water chillers, achieving a significant improvement in performance across all operatingconditions, with a COP of 7.0+ under national standard conditions. This technological achievement was appraised as "World Leading"by the Appraisal Committee of the China Machinery Industry Federation, won the First Prize of the Guangdong Science andTechnology Progress Award, and was selected as a "Gold Award Product" and "Product of the Year" at the 2024 China RefrigerationExpo. It has been widely applied in various projects such as public buildings, subway stations, and industrial refrigeration, and isexported to many countries and regions including Singapore and Russia.In response to the market demand for energy-saving renovations of buildings, the Company has launched modular integrated dynamicpressure gas suspension centrifugal machines. Product COP and IPLV both reach dual primary energy efficiency. It adopts a smallmodular design, equipped with dynamic pressure air suspension bearings, ensuring all-time high efficiency, flexibility, compactness,

and ease of maintenance, making building renovations simple and flexible.In response to the problems of low energy efficiency, difficulty in batch replication at the line level, large variations in operatingconditions, and inability to self-adjust operating parameters in traditional metro station air conditioner systems, the Company hasdeveloped a fully-conditioned high-efficiency intelligent environmental control system for metro stations based on variable frequencyand variable capacity technology, variable dynamic correction energy-saving control technology based on actual operating data of airconditioner systems, and a full-condition integrated environmental control system with low thermal resistance heat exchange and lowwater resistance pipe networks, achieving batch application in the metro field. This technological achievement was appraised by theAppraisal Committee of China Energy Conservation Association as being at the "World Leading" level.

Clean heating

In response to the demand for clean energy heating in place of coal in northern regions, the Company has launched the low-temperatureand high-efficiency integrated heat pump heating product. This series of products adopts dual-stage compression low-temperatureheating gas injection and enthalpy increase technology, direct current variable frequency drive liquid cooling and heat recoverytechnology, and stepwise precise gas injection control technology, achieving ultra-low temperature heating at -35°C and high watersupply temperature of 60°C, with heating/cooling energy efficiency exceeding the first level. The integrated modular design makesselection, installation and operation simple and flexible, meeting the heating market demand in northern regions.For non-process industrial heating applications, the Company has launched industrial large-capacity high-temperature centrifugal heatpump units. The product features high temperature, high efficiency, low carbon emissions, large capacity, and significant temperaturerise. It breaks through the bottleneck of comprehensive utilization of low-grade heat sources such as waste heat, with a single unit heatoutput reaching 10 MW and the highest outlet water temperature reaching 150°C. It can replace boilers for heating and promote energyconservation in the industrial sector.In response to the diverse demands for engineering hot water, the Company has launched a new generation of "Hot.Spa Area" full DCinverter air source heat pump water heaters. The product features two operation modes: hot water and heating, making it more adaptableto various engineering projects. It supports wide ambient temperature operation, providing stable heating from -20°C to 45°C and canproduce hot water up to 60°C. The side discharge shell design offers greater installation flexibility, reducing the floor space by up to37%, meeting diverse engineering requirements. It has obvious advantages in energy-saving performance, hot water supply capacity,operational stability, and ease of installation, effectively addressing the demand for clean hot water in public places such as schools,hotels, shopping malls, and shops.

Refrigeration and freezing

In response to the demands for rapid freezing and high energy efficiency in the cold chain logistics market, the Company has launchedultra-low temperature single-stage double-screw parallel units. The product's COP has been increased by more than 40% compared tosingle-stage compression, ensuring long-term efficient and stable operation of the units under rapid freezing conditions, significantlyreducing freezing time and operational energy consumption. In response to the demand for large-scale cooling applications, theCompany has launched an open-type screw compressor unit. The product has a single-unit displacement of up to 3,000 m?/h, achievinga 5% increase in energy efficiency. It adopts a new 7/8 tooth high-efficiency rotor profile, which is more suitable for low-temperatureconditions and effectively ensures the stable operation of the unit under harsh conditions."Zero-carbon source" air conditionerAfter ten years of technological research and development, the Company innovatively integrates photovoltaic energy and airconditioner products across borders. The world's first GREE "zero carbon source" air conditioner system won the highest award at the2021 Global Cooling Prize, which is highly in line with the national "dual carbon" goals.During the report period, the advanced photovoltaic energy storage direct current flexible system quality standard laboratory, led byGREE and jointly established with the University of Macau and Guangdong Power Grid, was approved for establishment in June 2024.The "zero carbon source" photovoltaic energy storage air conditioner system product series were further enriched, increasing to 15categories and 101 models. This successfully addressed the technical pain points of local consumption of photovoltaic power and peakshaving and valley filling of electricity. The application of this technology was included in the "Opinions of the Central Committee ofthe Communist Party of China and the State Council on Accelerating the Comprehensive Green Transformation of Economic andSocial Development". As of the end of 2024, the technology related to the photovoltaic (storage) DC air conditioner system has wonmultiple domestic and international awards, including the first Chinese Patent Gold Award in the home appliance industry, the UKRAC Annual Achievement Award, and the International Exhibition of Inventions of Geneva Gold Award; the Company's "zero carbonsource" system has been implemented in 35 countries and regions around the world, and it is estimated that it can achieve an annualreduction of about 110,000 tons of carbon emissions.

3. Home appliances

The Company, centering on the product strategy of "GREE, Making Better Home Appliances", has achieved full coverage of a seriesof products including refrigerators and washing machines, kitchen appliances, water heaters, environmental appliances and medicalaesthetics, etc. The products are positioned towards health, intelligence and personalization, and a set-based layout is implemented.

Refrigerator and washing machine

The Company's All-round Freshness Preservation series of refrigerators have developed self-balancing fruit and vegetable preservationtechnology, natural convection meat preservation technology and meat ultra-freezing storage technology. These technologieseffectively solve problems such as fruit and vegetable dehydration, meat surface drying and discoloration, nutrient loss, myoglobin andunsaturated fatty acid oxidation and deterioration in complex storage scenarios, achieving constant humidity control in fruit andvegetable storage scenarios and reducing meat juice loss rate. This technological achievement was appraised by the AppraisalCommittee of China National Light Industry Council as being at the "World Leading" level.

The Company has launched the “Zhenrou” series of washing machines and washer dryer. These products feature an active water rinsetechnology, addressing users' demands for deep cleaning, efficient sterilization, and smart interconnection scenarios of washingmachines. It achieves uniform and full coverage within the rinse bucket, saving 40% of time compared to traditional soaking rinsemethods, significantly reducing laundry time. The rinse efficiency reaches up to 97.4%, and the sterilization rate exceeds 99.99%.Additionally, they are equipped with smart WiFi functionality, enhancing the user experience. The product won the bronze medal atthe 49th International Exhibition of Inventions of Geneva with its outstanding performance and innovative technology, and has beenwidely praised by users.

Kitchen appliance

The Company has launched a wall-mounted instant hot water dispenser that can achieve "boiling and then cooling to produce warmwater in seconds", provide hot water at all temperature ranges and offer 1°C precise temperature adjustment. With a large flow rate of800 mL/min, it is compatible with full-flow water purifiers, making it convenient to use. Moreover, the water tank is equipped withultraviolet sterilization technology to ensure drinking water safety.The Company has launched uncoated cast iron rice cookers and stainless steel rice cookers. The cast iron rice cooker adopts the ancientcasting process and combines modern high-temperature nitriding and oxidation surface treatment technology to achieve a chemical-free coating, preventing air, moisture and the iron base material from coming into contact, thus making the cast iron inner pot lessprone to sticking and rusting, allowing consumers to use it with confidence and enjoy healthy meals. The stainless steel rice cooker ismade of high-quality 316L food-grade stainless steel, treated with polishing and brushing processes, without coating, wear-resistant,corrosion-resistant, and resistant to hard object scratches, ensuring a longer service life. Meanwhile, the inner pot is specially designedwith micro-scale dot array pits, which can reduce the contact area of the rice and lower the adhesion force of the rice, achieving long-lasting non-stick performance.The Company has launched the "Clean Star" range hood, which is equipped with a 10-year inner cavity maintenance-free cleaningtechnology, solving the industry's difficult problems of hard-to-clean and strong odor inside the range hood. Through the motor FOCcontrol technology and NVH noise reduction technology, it has continuously broken through in terms of air volume and performance.The Company has launched a new type of built-in disinfection cabinet. With its efficient sterilization and drying composite technology,it can easily kill 99.99% of bacteria and viruses, and its disinfection level has reached the highest two-star standard in the industry.

Water heaterThe Company has launched a 18-liter large-capacity gas water heater. The product is equipped with a zero-cold-water function,achieving constant temperature and comfortable bathing needs, which is more suitable for families with many people, multiple kitchensand bathrooms, and villa-type families. Moreover, in response to the problem of water tank corrosion caused by poor water quality, ano-coil high-efficiency heat exchange system has been developed, successfully solving the problem of water tank corrosion.

Environmental appliance

The Company has launched a tower-shaped voice-activated warm air blower. It is equipped with an offline voice module and featuresa separate sound cavity structure. Without the need for an internet connection, it achieves a voice recognition rate of over 91% and hasno false wake-ups within 48 hours. It adopts an anti-disturbance dual-power pressurized air duct to keep the noise level at or below 50dB. The design of a large arc-shaped air outlet with anti-scalding structure ensures even heat dissipation, better meeting the needs ofconsumers.The Company has launched the Flame Humidifying Baseboard, which integrates ultrasonic humidification to ensure warmth withoutdryness. It features a flame-like ambient light design to create a cozy fireplace-like heating experience. Equipped with IPX4 waterresistance and graphene heating elements, it offers a temperature range of 16°C to 30°C, with smart temperature control, making it safefor both home and bathroom use.Medical aesthetic productsThe Company, centering on users' demands for a healthy and high-quality life, has launched a series of home health products such asthe GREE Double-sided Beauty Instrument, blood pressure monitors, nebulizers, and pulse oximeters.The Double-sided Queen Microcurrent Beauty Device is equipped with 1.5 kHz oscillating current technology that adapts to skincharacteristics and dual cold and hot face plates technology, allowing you to enjoy salon-level care at home.The Masked Queen Spectral Beauty Device adopts a rapid response self-sensing technology, completely solving the problem ofdazzling strong light during use.The blood pressure monitor adopts a stable pressure measurement technology, which can reduce the risk of measurement resultfluctuations caused by factors such as patients' psychology during the testing process, ensuring the accuracy of the measurement data.The nebulizer adopts reflux liquid level detection technology, lengthening the path between the electrode and the nebulizationmembrane, solving the problem in the industry where the liquid level detection of nebulizers is inaccurate due to the influence of waterfilm, and ensuring the accuracy and reliability of liquid level detection for drug solutions with different conductivities.

The blood oxygen monitor adopts photoelectric blood oxygen detection technology combined with volume pulse plethysmographytechnology to enhance the accuracy of blood oxygen saturation and pulse rate sensing, and achieve rapid analysis and measurementresults.

(II) Adhere to independent innovation, constantly make breakthroughs in world-leading technologiesThe Company adheres to independent research and development of core technologies, upholds the concept of "unlimited investmentbased on demand", and has established a multi-level and high-level R&D platform system relying on national-level scientific researchplatforms. It has formed a technological innovation system that is "enterprise-oriented, market-driven, and combines industry, academia,and research", achieving remarkable results.

1. Major scientific research achievements have been certified as “World Leading”, and core technologieshave been broken through.

The project "120°C+ Industrial Large-capacity High-efficiency High-temperature Centrifugal Heat Pump" has been appraisedby the Appraisal Committee of China Machinery Industry Federation as being at the "World Leading" level. The Company hasindependently developed three innovative technologies: 120°C+ high-speed direct-drive high-temperature heat pump centrifugalcompressors, 60K+ temperature rise dual-compressor series and multi-stage compression gas injection high-efficiency industrial heatpump units, and high-temperature enhanced heat exchange. These innovations have addressed industry problems such as the difficultyin cooling compressors in high-temperature environments, the easy overheating and failure of bearings, motors, and lubricating oil, thepoor stability of rotor high-speed operation under high-temperature and heavy load conditions, the low system performance with a120°C water outlet and large temperature rise, and the poor performance of heat exchangers at high temperatures.The project "COP7.0+ Dual-stage Permanent Magnet Variable Frequency Screw Chiller" has been appraised by the AppraisalCommittee of China Machinery Industry Federation as being at the "World Leading" level. The Company has applied the two-stagescrew compressor technology to water-cooled chillers, achieving inter-stage gas injection to enhance system efficiency. At the sametime, it is equipped with a new type of small pressure ratio, same-tooth, different-structure, isochoric and highly efficient rotor profile,as well as precise and adaptive control of the two-stage pressure ratio without position identification, significantly improving theefficiency across all operating conditions. The COP under the national standard condition C reaches 7.0+, which can meet the usagerequirements of various public buildings, rail transit, data centers and other fields.The project "Research and Application of Key Technologies for Low-carbon Dynamic Operation of Inverter Air Conditioners"

has been appraised by the Appraisal Committee of China National Light Industry Council as being at the "World Leading" level. TheCompany has launched air conditioners equipped with the "Key Technology for Low-carbon Dynamic Operation of Inverter AirConditioners". After third-party testing, the product's dynamic energy efficiency optimization control technology based on artificialintelligence algorithms and room load adaptive technology based on neural network self-learning have achieved a dynamic energyefficiency improvement of over 15.8% throughout the year and a reduction in annual power consumption of 13.6%. It realizes the bestdynamic operation effect of air conditioners, rapid temperature control, comfort and energy saving, and solves the problems of the lackof dynamic operation energy efficiency evaluation methods for current air conditioners and inconsistent actual energy-saving effects.The project "Research and Application of Key Technologies for Fresh-keeping of Fruits, Vegetables and Meats in HouseholdRefrigerators" has been appraised by the Appraisal Committee of China National Light Industry Council as being at the "WorldLeading" level. The Company has developed a series of innovative technologies for preserving fruits and vegetables and meats,including self-balancing high-permeability moisture membranes and air-source vapor humidification for fruits and vegetables, naturalconvection overcooling for meat preservation, and wide-frequency fully enclosed piston compressors for ultra-freezing storage of meats.These technologies have effectively addressed the challenges of excessive moisture condensation and bacterial growth or insufficienthumidity leading to dehydration in complex storage scenarios for fruits and vegetables, with measured humidity reaching up to 95%.Additionally, the Company has expanded the maximum operating frequency of R600a fully enclosed piston compressors to 120 Hz,enabling long-term stable operation of refrigerators at -38°C. This breakthrough has overcome the issues of rapid volume efficiencydecline and poor reliability of existing refrigerator compressors at ultra-high frequencies.The project "Key Technologies and Applications of High-Efficiency Intelligent Environmental Control System for MetroStations under All Operating Conditions" has been appraised by the Appraisal Committee of China Energy ConservationAssociation as being at the "World Leading" level. The Company has established a comprehensive standard system for the entire lifecycle of efficient computer rooms for intelligent environmental control systems in subway stations, adopting a full-process standarddigital implementation and delivery model to ensure the efficient construction and operation and maintenance of the environmentalcontrol system. At the same time, it has developed a full-condition efficient integrated environmental control system based onpermanent magnet variable frequency variable capacity screw chillers, low-resistance distribution pipelines throughout the process,matrix EC fan walls, and variable flow direct-drive cooling towers with permanent magnet synchronous motors, solving the industryproblem of the inability to decouple flow and pressure ratio. It has also created a simulation system architecture with data modelaccompaniment and invented a variable dynamic correction energy-saving control technology based on actual operation data of the airconditioner system, achieving global optimization of operating parameters for the environmental control system under all conditionsand ensuring a comprehensive improvement in the "quantity-quality-efficiency" of the environmental control system in subway stations.The project "Key Technologies and Applications of Magnetic Bearing Motor System" has been appraised by the AppraisalCommittee of the China Electrotechnical Society as being at the "World Leading" level. The Company has broken through the technicalbarriers of the industry, independently mastered the full set of core technologies of the magnetic bearing system, and for the first timeachieved the industrialization of the full series of magnetic bearing compressors. It has also realized the serialization of industrialproducts such as magnetic levitation air compressors and magnetic bearing high-speed motors, solving the key technical problems ofmagnetic bearing motor systems and their application in refrigeration and air compressors, as well as the stability, reliability and safetyissues of magnetic bearing technology in complex environments.

2. Multiple R&D projects have won important awards, and the achievements in innovation are remarkable.The project "Key Technologies and Industrialization of High-Performance Screw Refrigeration Compressors in ComplexEnvironments" won the First Prize of Science and Technology Progress of Guangdong Province. The Company, in collaboration withXi'an Jiaotong University and Zhejiang University, has gone through four generations of technological innovation and spent ten yearsin research and development to break through the bottleneck. It has achieved significant breakthroughs in compressor theory, rotorprofile, flow layout, and pressure ratio control. It has overcome the challenge of simultaneously enhancing the rated efficienccy andvariable working condition efficiency of compressors under complex climatic conditions. Moreover, it has broken through the

reliability guarantee technologies for compressors in extreme environments, such as anti-impact, long service life, and low vibration.The first small pressure ratio dual-stage permanent magnet variable frequency adaptive variable pressure ratio screw compressor hasbeen created. The COP of the entire series under national standard conditions has exceeded 7.0, setting a new energy efficiencybenchmark for water chillers.The project "Research and Application of Key Technologies for Efficient Room Temperature Catalytic FormaldehydeRemoval" won the second prize of Science and Technology Progress of Guangdong Province. The Company has invented a highlyactive and selective dual-metal room-temperature catalytic formaldehyde removal material, which can rapidly, effectively andenvironmentally decompose formaldehyde into harmless carbon dioxide and water at room temperature. The formaldehydedecomposition efficiency is as high as 99.9%, making it suitable for high-quality air purification in enclosed and semi-enclosed spaces.The technological achievement has been applied to the Company's room-temperature catalytic formaldehyde removal series of airpurifiers, and has won the Gold Award at the International Exhibition of Inventions of Geneva and the China Patent Excellence Award.The project "Research and Industrialization of Key Technologies for Servo Motors and Control of High-Performance Robots"won the second prize of Science and Technology Progress of Guangdong Province. The Company has successfully developed anintegrated high-power density servo motor and a single-chip multi-core multi-axis integrated collaborative precision servo controltechnology. It has also overcome a new high-anti-disturbance technology for complex multi-dimensional disturbances, and developedhigh-performance servo motors and drivers dedicated to robots, achieving industrialization. These products have now been widelyapplied by mainstream domestic robot manufacturers and have been extended to fields such as CNC machine tools and semiconductors.

3. Actively participating in the formulation of standards, the Company has demonstrated its leadinginnovative strength

The Company has taken the lead in or participated in formulating 873 international standards, national standards, etc., among which64 are international standards. The Company actively participates in and assumes responsibilities for a total of 153 domestic andinternational standardization organizations related to the home appliance industry, among which 40 are international and foreignstandardization organizations. The Company is among the first batch of intellectual property demonstration units of enterprises andinstitutions in the country and has won the China Trademark Gold Award. As of the end of 2024, Gree Electric Appliances's 7subsidiaries have been selected as National Intellectual Property Demonstration Enterprise and 17 subsidiaries as National IntellectualProperty Advantage Enterprise. During the report period, the Company filed 10,112 patent applications, including 6,959 inventionpatent applications, and was granted 5,413 invention patents. It won one Gold Award for China's Design Patent, three China PatentExcellence Awards, and two provincial patent gold awards. It also received three Gold Awards, four Silver Awards and one BronzeAward at the Geneva and Nuremberg International Invention Exhibitions, demonstrating the power of innovation of GREE to the world.

4. Continue to increase investment in research and development in new product areas and continuouslyenhance product competitivenessThe Company has vigorously promoted the development of original products and achieved remarkable success in industrial design,winning 26 international design awards, including 15 iF Industrie Forum Design Awards and 11 Red Dot Design Awards. By the endof 2024, the Company had 4 national-level research platforms and 13 provincial and ministerial-level research platforms. It hadaccumulated a total of 122 important awards at the national, provincial and ministerial, and industry levels. It also possessed 46 "WorldLeading" technologies, demonstrating the Company's strong innovation capabilities.During the report period, the Company not only achieved fruitful results in technological research and development, but alsodemonstrated outstanding capabilities in standard setting and intellectual property protection, fully reflecting the Company'sdevelopment strategy of adhering to the spirit of independent innovation and continuously breaking through world-leading technologies.(III) Continuously optimize the quality management system to achieve outstanding product quality for theCompany

The Company has always adhered to the principle of quality first, with the pursuit of perfect quality as its guiding orientation. Itimplements strict quality control throughout the entire process, from the design of products to procurement, production, packaging,transportation, installation and service. By strictly controlling the quality at the source and building a sound system, we ensure the highstability and leading level of the Company's product quality.Continuously leading industry standards, the Company has received numerous honors. During the report period, the standards it led informulating, namely Quality Management - Innovation Cycle Guide Based on Customer Demand (GB/T 38356-2019) and EvaluationMethod and Testing Method for Energy Performance of Refrigerating Systems - Part 1: Energy-Storage Air Conditioning Systems(GB/T 37227.1-2018), won the second and third prizes respectively in the Guangdong Province Standardization OutstandingContribution Award for Standard Projects, making it the home appliance enterprise that received the most awards this time. It undertookthe work of the Refrigeration Equipment Research and Review Base of the China WTO/TBT-SPS National Notification Enquiry Centerand was recognized as one of the six outstanding review bases nationwide by the General Administration of Customs. It was alsoawarded the titles of "Guangdong Province Leading Standard Enterprise" and "Guangdong Province Standardization OutstandingContribution Award for Standard Organization", and was approved to establish the Guangdong Province Advanced Light StorageDirect System Quality Standard Laboratory, being rated as a "2024 Outstanding Contribution Unit in Standardization".During the report period, the Company's products were recognized in both domestic and international markets for their outstandingquality and leading edge. The Company's ACCL, WCCL, USHP, PTAC, PTHP, and VRF have maintained a 100% pass rate in marketspot checks for three consecutive years, and have once again been awarded the "Outstanding Performance" certificate by the AHRI.The Company has won one first prize, two second prizes and nine third prizes in the China Quality Technology Award. According tothe evaluation data from the Customer Satisfaction Evaluation Center of China National Institute of Standardization, since 2011,GREE's air conditioner products have maintained the industry's top customer satisfaction for 13 consecutive years.(IV) Focus on industrial transformation, continuously promote diversified development, and actively explorenew growth areasCompressorThe Company has launched a broadband and high-efficiency rotor compressor. Its operating frequency range is 33% wider than thatof conventional mass-produced inverter compressors, with energy efficiency improved by more than 10% and low-temperature heatingcapacity increased by more than 10%. The maximum operating frequency reaches 160 Hz, solving the problems of insufficient high-frequency operation and low-temperature heating in air conditioners. It has been fully serialized and mass-produced for export inresidential air conditioners.The Company has launched a new generation of high-efficiency compressors for base station air conditioners. With innovative designssuch as low-power motors, compact and efficient pump structures, and low-friction bearing systems, the energy efficiency ratio hasbeen increased by 5%.The Company has launched a new generation of ultra-efficient floor-standing air conditioner compressors, featuring innovative designssuch as friction-reducing and energy-saving materials and low-power motors. The energy efficiency ratio has been increased by 5.3%,and they have been fully applied to residential floor-standing air conditioners.The compressor series products help further enhance the core competitiveness of the Company.

MotorIn home appliance motors, the Company has adopted new energy-saving materials, optimized motor design and electromagneticschemes, etc., to introduce high-performance, noise-reducing motor vector controllers and shock-absorbing structures that block thetransmission of motor noise. It has also promoted the application of high-power-density 10-pole IPM DC brushless motors in homeappliances.In servo motors, the Company has launched high-reliability, ultra-high power density and ultra-compact servo motor products. In thedomestic robot market, our market share has rapidly increased.

In new energy motors, the Company has successfully developed the industry's first high-speed reluctance main drive motor for logisticsvehicles, with a higher efficiency than rare earth motors. The Company has also completed the development of the Company's firstmain drive motor platform for integrated electric drive axles in buses. Compared with traditional direct drive motors, the new productreduces costs by 15%. Additionally, the Company has completed the research and development of new energy generators for extendingthe range of ships, oil pump motors for heavy trucks, and generators for extending the range of mining trucks, expanding the applicationof new energy motors to the fields of electric ships and construction machinery.In industrial motors, the Company has tackled the industry's bottlenecks, such as magnetic circuit saturation, easy demagnetization,and large torque pulsation at deep weak magnetic fields in high-power new reluctance motors through technological breakthroughs.The Company has launched a series of high-efficiency, high-power new reluctance motors with power ranging from 0.75 to 315 kW,exceeding the industry's highest efficiency IE5. The related products have been widely applied in equipment in industries such as metalwire drawing, ball mills, and rubber open mills, breaking free from the constraints of rare earth resources and ensuring the sustainabledevelopment of the industry.Wire and cable

The Company has launched large-sized enameled flat wires, which have been successfully applied in transformers, inverters, windpower, photovoltaic and other fields. It has also introduced a series of products including 155, 180 and 200 grades, covering varietiessuch as EI/AI/SB, UE/SB, EI/SB, with self-adhesive temperatures ranging from 150 to 230°C. Moreover, it has developed new typesof wires for the automotive industry and passed the IATF16949 system certification. The continuous breakthroughs in new productsand new technologies help the Company enhance the competitiveness of its products in emerging fields.Capacitor

The Company has continuously achieved technological breakthroughs in reducing the cost of electrolyte, new energy products of filmcapacitors and intelligent power modules. In terms of reducing the cost of electrolyte, by applying low-cost electrolyte and high-tolerance ripple electrolyte technology, the Company has launched large-capacity and high-performance products for the homeappliance sector, which can operate stably at 125°C with a 4.0 A ripple for 500 hours. In the field of film capacitors for new energy,the Company has introduced new products that feature high energy density, high voltage resistance, and low loss, and can work stablyat 110°C, with a broader range of applications. Regarding intelligent power modules, through the technological upgrade of bondingwires, the packaging cost of the products has been significantly reduced, further enhancing their competitiveness in the market.Cooling partsIn recent years, the Company has accelerated its diversified layout, acquired DunAn Environment, optimized the supply chain, andimproved its industrial chain layout. Focusing on the main business of refrigeration, DunAn Environment manufactures a series ofproducts aimed at the entire HVAC&R industry to fully support segmented fields such as residential air conditioners, commercial airconditioners, air source heat pumps, freezing and refrigeration, and new energy vehicle thermal management. It has a state recognizedenterprise technology center, a national postdoctoral workstation, an academician workstation, a CNAS laboratory, and a national fullperformance testing center of central air conditioner. Therefore, it has formed a product development platform and core technologysystem with independent intellectual property rights. Relying on the R&D platform and following the orientation of "green, efficient,comfortable, and intelligent" technology development, DunAn Environment makes doubled efforts in research and development andpursues progress in key new products.During the report period, the market share of DunAn Environment's cut-off valve ranked first in the world, that of four-way valveranked second in the world, and that of electronic expansion valve ranked second in the world.SemiconductorThe Company offers a range of products including MCU, power semiconductors, and AIoT SoC series. Among them, the 32-bit seriesMCU chips have been widely applied in batch in terminal products such as residential air conditioners, commercial VRF, wirecontrollers, and remote controls, with an annual usage exceeding 40 million units. They can be widely used in consumer electronics,

wearable devices, home appliances, health care equipment, commercial large-scale units, industrial sensors, high-performance motorcontrol, and other fields. The power semiconductors such as FRD, IGBT, IPM, and PIM have been applied in batch in inverter airconditioners, with an annual usage exceeding 30 million units. They can be widely used in home appliances, intelligent equipment,new energy, and other fields. The AIoT SoC intelligent chips, with innovative embedded architecture, integrate high-performance AIcomputing power and the real-time performance of MCUs, and have been applied in batch in air conditioner products, further improvingthe energy efficiency of air conditioners. At the same time, they can be widely used in machine vision, intelligent voice, HMI, intelligenthome appliances, and other fields. By the end of 2024, the Company had cumulatively applied for 738 patents related to integratedcircuits in the semiconductor field and obtained 255 patents. It has successively won the Excellent Award of the 22nd China PatentAward, the Silver Award of the 7th Guangdong Province Patent Award, the Excellent Award of the 10th Guangdong Province PatentAward, and the Excellent Market Performance Product Award of the 16th "China Chip". A total of 9 products have been awarded thetitle of Guangdong Province Famous and High-tech Products, and 2 products have been awarded the title of Zhuhai City InnovativeProducts.

Recycling

The Company actively practices the producer responsibility extension system and innovatively proposes the circular developmentmodel of "green design - green manufacturing - green recycling" to ensure the green efficiency of the whole industrial chain.In accordance with the requirements of the "Action Plan for Promoting Large-scale Equipment Upgrading and Consumer Goods Trade-in" issued by the State Council, the Company has comprehensively integrated its 30 regional sales networks, 20,000 sales stores, and30,000 service outlets to provide users with an integrated "delivery, disassembly, and installation" service. All old devices are 100%traceable through the system and enter standardized recycling and dismantling factories to achieve resource recycling and regeneration.Through its unremitting efforts in the construction of the recycling system and the closure of the circular resource chain, Gree RecyclingResources Co., Ltd. has been approved as a national pilot for circular economy standardization and a pilot enterprise for the constructionof the recycling system of the Ministry of Commerce. By the end of 2024, the Company's recycling resource system has processedmore than 64.77 million units (sets) of various types of waste electrical and electronic products, and has transformed about 880,000tons of recycled copper, iron, aluminum and plastic.

Smart deviceThe Company is actively making strategic plans in CNC machine tools, industrial robots and automation, providing intelligentequipment products for many leading enterprises both at home and abroad. By the end of 2024, the Company had established 2provincial-level scientific research platforms in the field of intelligent equipment, including 1 provincial-level enterprise technologycenter and 1 provincial-level manufacturing innovation center. It had cumulatively applied for 5,096 patents and obtained 1,966 patents,among which 3,642 were invention patents and 1,081 were granted.The Company has launched three new products for processing components of new energy vehicles in the new energy vehicle market.These include high-speed five-axis swivel heads, high-rigidity and high-torque electric spindles, and servo motors for machine tools,which are core components of CNC machine tools. Based on its expertise in processing battery trays for new energy vehicles, theCompany has expanded its services to offer one-stop solutions for processing die-cast aluminum and large-scale integrated die-castparts for new energy vehicles, increasing processing efficiency and stability by 50%.For the new energy photovoltaic and lithium battery sectors, the Company has launched a series of six-axis robot products such asGR35 and GR50, as well as SCARA robot products like GRS10 and GRS20. For the shipbuilding and steel structure welding markets,the Company has introduced new products such as the GRH6 arc welding robot and intelligent welding workstations. Based on differentcustomer demands, the Company provides intelligent robot automation application solutions for the manufacturing of new energyvehicle components and the welding of ships and steel structures. Guided by the demands of industrial development, the Company hasestablished stable cooperative relationships with key national universities through multi-level and multi-form collaborations. We arecommitted to promoting resource sharing, mutual empowerment, enhancing academic and research exchanges, and intensifyingresearch and breakthroughs in standards, processes, and key technologies in the field of intelligent manufacturing equipment.

During the report period, the Company successfully completed the acceptance of multiple provincial and municipal-level scientific andtechnological projects, including the "Guangdong Provincial Key Laboratory of High-Performance Servo Systems", the ZhuhaiIndustrial Core Technology Breakthrough Project "Research and Development of Intelligent Logistics and Warehousing System", andthe Zhuhai Industry-University-Research Project "Research and Product Application Development of Key Technologies for High-Precision Intelligent Measurement System of Industrial CT". These achievements were highly recognized by industry review experts.

Precision mold

Gree Precision Mold adheres to a high-standard quality control concept and closely revolves around the "4+1" business model, that is,home appliance molds, automobile molds, precision molds, and motor molds + mold products, making it maintain a leading position.Gree Precision Mold has set up a supporting mold center in all production bases of the Company, 4 R&D platforms, 1 national-levelskilled master studio, 3 municipal-level skilled master studio, 1 municipal-level skill workstation, 1 municipal-level model workerinnovation studio, and 12 technical manufacturing service centers, providing customers with reliable and cost-effective one-stopsolutions.During the report period, Gree Precision Mold intensified its research on the waste-free layout stamping process for straight bar statorcores in the motor field, significantly reducing material consumption and achieving a 20% increase in material utilization rate, whichnotably lowered the cost of straight bar cores. Based on the NSGA-II algorithm, it enhanced the efficiency research of deep rib CNChigh-speed processing through the optimization of existing parameters, increasing processing efficiency by over 20%. The optimizationof high-efficiency precision electrical discharge machining (EDM) processes continued to deepen, achieving an electrode wearprediction accuracy of 99% and a 20% increase in the processing efficiency of parting surfaces. In the field of aluminum sheet precisionforming technology, it successfully overcame the technical challenge of "shear bright band", enabling the shear bright band of productshapes to reach over 80%.(V) Strengthen digital operation, promote the integration of dual lines, and achieve efficiency improvementthroughout the entire channel chain

1. Digital operation, optimizing channel efficiency

The Company, centering on its business strategy planning, continuously optimizes the efficiency of the entire channel chain throughmeticulous management and digital operation methods. It implements a scientific inventory strategy to reduce stock and increaseinventory turnover rate; adjusts the layout of the warehousing network to enhance logistics efficiency and shorten delivery time;predicts market demand through data analysis to lower the risk of inventory stagnation; and uses digital tools to monitor productcirculation to improve product turnover rate.

2. Expand online marketing channels to facilitate the integrated development of both online and offlinebusiness

The Company actively expands its online marketing channels, strengthens its layout across the entire network and all platforms, andenhances its brand influence. For the young consumer group, it adopts various marketing methods such as live-streaming sales,community marketing, cooperation with private domain influencers, and precise advertising placement to increase brand appeal. It hasentered multiple platforms such as JD.com, Tmall, and Douyin, and opened the GREE Dong Mingzhu Store on mainstream e-commerceplatforms to broaden its online marketing channels. It also deepens the integration of online and offline, promotes offline merchants toparticipate in expanding online channels, achieves sales growth, and creates an integrated online and offline shopping experience.

3. Deepen the user service system and enhance the consumer experience

The Company is committed to building an integrated online and offline user service system to enhance the overall consumer experience.It promotes the digital transformation of offline stores to offer immersive shopping experiences. Through system integration, itimproves the efficiency of after-sales processing to ensure that order fulfillment is both efficient and accurate. It utilizes digital meansto enhance supply chain management capabilities, optimize the layout of intelligent warehouses, and increase the efficiency of business

personnel.

4. Launch innovative brands and expand the business of immediate retail

The Company has launched a new channel strategy brand, "Dong Mingzhu Healthy Home", which reconfigures the retail value chainthrough innovative means such as scene-based experiences, data visualization, and intelligent interactive services, providing consumerswith a more convenient and intelligent shopping experience. At the same time, relying on local physical stores, it deeply integratesonline traffic with the offline supply chain to meet consumers' immediate demands for goods, further expanding new traffic channelsand empowering terminal stores.The Company will establish a nationwide dual-channel sales network based on its existing 30 regions, over 30,000 offline outlets andflagship stores on third-party e-commerce platforms, providing an integrated dual-channel service that combines offline experience,online ordering, and unified national delivery and installation, to achieve a win-win situation for the enterprise, distributors andconsumers.(VI) Launch differentiated products in the global market and continuously enhance brand competitivenessThe Company adheres to a market and user-centered approach, continuously making efforts in overseas markets. It has been developingits own brand in various aspects such as products, quality, and services, and is constantly enhancing the global influence of the GREEbrand. By the end of 2024, GREE products have covered over 190 countries and regions worldwide, with its own brand accounting fornearly 70% of total export sales.In response to the diverse demands of overseas markets, the Company has continuously launched innovative products. During thereport period, in extreme temperature regions around the world, it introduced ultra-high temperature refrigeration and ultra-lowtemperature heating air conditioners, achieving stable operation in environments with the highest temperature of 68°C and the lowestof -40°C. For the severe cold climate in the northeastern United States and northern Canada, it launched a new dual heat source product,ensuring stable heating in extremely cold weather. The single category of ultra-low temperature heating household units in NorthAmerica became a bestseller. According to the market demand and local aesthetic characteristics of Brazil, it customized high-endproducts for local customers, with sales increasing by 75% year-on-year. To meet the demands of high-end residences in North America,it launched refined and differentiated patio units, catering to the diverse needs of overseas consumers.Strengthening self-owned brands and channel expansion. In the North American market, the three self-owned brands of GREE, TOSOT,and KINGHOME are developing together. The Company actively explores local traditional HVAC channels, large-scale installationcompany channels, and large-scale retail channels, and has opened several new GREE stores in the New York area of the United States.In Eastern Europe, the number of GREE stores has exceeded 200. In Latin America, a 1,200-square-meter GREE flagship store wasnewly built in Bolivia. These measures not only enhance the popularity of self-owned brands but also lay a solid foundation forsubsequent business development. During the report period, the Company has cooperated with international sports events ororganizations in different regions and countries, such as the 2024 Summer Olympics in Paris, the Saudi King's Cup football tournamentand the national league, the Spanish Real Betis football club, the Italian Napoli football club, and the Bolivian football powerhouseBlooming club, to strengthen brand promotion and product marketing.Winning multiple landmark projects, the Company has been widely recognized in overseas markets. During the report period, theCompany successively won bids for several large-scale commercial engineering projects, such as the Morowali Industrial Park inIndonesia, the largest shopping complex in Iraq - Karbala Shopping Resort, the Ferrari Museum office building in Greece, the St.George Hospital in Plovdiv, Bulgaria, the BYD Cama?ari factory in Brazil, the headquarters building of Band in Brazil, the sportsvenues for the Asian Youth Games in Uzbekistan, the National Stadium in Ethiopia, and the Prime Minister's Office in Ethiopia. Theimplementation of these large-scale projects in public facilities, industrial parks, star hotels, and chain restaurants has established theinternational image of the GREE brand.(VII) Building the Internet of Everything, leading a Smart and Healthy LifeGREE Smart Home adheres to independent innovation, R&D, and manufacturing. It uses core technologies to create a zero-carbon

healthy home, continuously upgrading the five smart living systems of whole-house energy, air, health, security and lighting. It haslaunched the Smart Comfortable Home whole-house smart solution based on the characteristics of different living spaces such as livingrooms, bedrooms and kitchens, to create a green, efficient, convenient and safe home Internet of Things space.In terms of smart products, the Company offers a rich and professional range of whole-house smart products, including air systemproducts such as heating and cooling, fresh air, and environmental appliances; health system products such as water usage, diet, andpersonal care; energy system products for light, storage, and air; lighting system products like lights and curtains; and security systemproducts including door locks, cameras, and safety sensor kits. The Company will continue to expand its product matrix and ecosystempartnerships to provide users with more high-quality and personalized product options.In the field of intelligent health technology, the Company has made in-depth layouts in full-house intelligent systems, full-housecommunication architectures, intelligent voice interaction, and home appliance intelligence. It has independently created the IoTplatform, intelligent decision-making system, G-Voice voice interaction system, intelligent vision system, G-Learning comfort andenergy-saving algorithm, AI energy-saving modules, and user behavior habit learning energy-saving algorithm, among other intelligentIoT technologies. According to the "2024 Top 100 Global Smart Home Invention Patents Ranking" released by the intellectual propertyindustry media IPRdaily, GREE ranked among the top globally with 3,097 patents, once again receiving professional recognition forits R&D strength.

(VIII) Accelerate the transformation and upgrading of intelligent manufacturing and build an industry-leading smart factory

The Company promotes efficiency improvement, value creation and business goal enhancement through digitalization, builds a leanmanufacturing system centered on dual effectiveness, and promotes systematic optimization and comprehensive upgrading throughoutthe entire product life cycle, the entire production process and the entire supply chain, to drive the transformation of intelligentmanufacturing in the enterprise.Establish a lean manufacturing system to empower efficient production management. The Company aims to build a digital factory,based on lean manufacturing. By enhancing flexible automation capabilities, integrating internal and external factory data,consolidating information system platforms, and promoting intelligent applications, it optimizes production operations. It establishesa group-wide lean smart manufacturing system that fully connects machines, materials, personnel, control systems, and informationsystems, to improve quality, increase efficiency, reduce costs, and lower inventory in the production process. This approach enablesrapid resolution of on-site production issues and enhances management efficiency. During the report period, the Company's project"Construction and Implementation of Lean Manufacturing System for Large Home Appliance Enterprise Group" won the "First Prize"of the 31st National Modernization Innovation Achievements in Enterprise Management.Build a leading intelligent factory. Based on the lean manufacturing system, the Company continuously applies informationtechnologies such as industrial internet, cloud platforms, artificial intelligence, big data and 5G to every aspect of the smart factory,achieving interconnection and interoperability among production equipment, instruments and meters, sensors, control systems andmanagement systems, as well as in-depth application in scenarios such as operation monitoring, intelligent production, qualityinspection, warehouse storage and logistics distribution. During the report period, the Company's Jinwan factory was selected into thefirst batch of "Outstanding Intelligent Factory" list by the MIIT of the People's Republic of China.(IX) Build an efficient talent cultivation and incentive system to support the steady progress of the group

The Company adheres to the strategic guideline of "strengthening the enterprise with talent", attaches great importance to internal talentcultivation and team building, and promotes the overall development of the enterprise.Build a high ground for skills and facilitate the enhancement of talents' skills. During the report period, the Company integratedpolicies at all levels and internal and external teaching resources and venues to establish a national-level high-skilled talent trainingbase covering multiple professional fields. It organized 31 skill competitions in three major directions: frontline operation skills,production quality and lean production, and equipment operation and debugging. It trained nearly 1,500 special workers and wasawarded the qualification of the chain leader of the "industry-education-evaluation" skill ecosystem in Guangdong Province. In 2024,

a total of 850 skilled workers of the Company obtained vocational skill level certificates, and 3,376 skilled workers were honored withthe title of "craftsman", further consolidating the Company's talent foundation.Accelerate the construction of a learning organization and continuously enhance the professional capabilities of all employees.During the report period, the Company focused on three directions: general capabilities, professional knowledge, and quality courses.It systematically organized and carried out open classes for all employees and key business training in technology research anddevelopment, production management, product planning, and sales expansion. It conducted nearly 6,000 specialized training sessions,with an average of over 46 hours per person, significantly enhancing the professional quality and technical proficiency of its staff.Diversified incentive policies, sharing the dividends of development, and stabilizing the talent echelon. During the report period,the Company established a diverse bonus system including the Science and Technology Progress Award, Management InnovationAward, Rationalization Suggestion Award, Performance Award, and Year-end Bonus, and organized honor selection activities such asGREE Advanced Pioneers, Workers' Vanguard, Advanced Work Teams, Excellent Teams in Quality Activities, Lean ImprovementProjects, and Most Beautiful Veterans, to motivate employees to be proactive and innovative. The Company consistently launched andimplemented the employee stock ownership plan to improve the benefit sharing and risk sharing mechanism between the Companyand core employees, fully mobilize the enthusiasm and cohesion of employees, and promote the long-term, sustainable, and healthydevelopment of the Company.

2. Revenue and cost

(1) Composition of operating revenue

Currency: CNY

(2) Industries, products, regions, and sales models that account for more than 10% of the Company's operating revenue oroperating profits?Applicable □ Not applicable

Currency: CNY

In case the statistical caliber of the Company's main business data is adjusted during the report period, the Company's main businessdata will be adjusted according to the caliber at the end of the report period in the last year.

□ Applicable ?Not Applicable

(3) Whether the Company's revenue from physical sales is greater than that from labor services?Yes □NoDescription of a year-on-year change of 30% or more in relevant data

□ Applicable ?Not Applicable

(4) Performance of significant sales contracts and purchase contracts entered into by the Company as of the report period

□ Applicable ?Not Applicable

(5) Composition of operating costs

Industry classification

Currency: CNY

(6) Whether there was a change in the combination scope during the report period

?Yes □No

1. Business combination not under common control

(1) Business combinations not under common control that occurred during the period

Currency: CNY

(Continued)

Currency: CNY

On June 30, 2024, the Company's wholly-owned subsidiary, DunAn Environment, acquired 62.95% of the equity of Shanghai DatroAutomotive Technology Co., Ltd. (hereinafter referred to as "Datro") through a cash transaction valued at CNY214.5977 million, andalso increased its capital in Datro by CNY30 million. After the transaction was completed, DunAn Environment held 65.95% of theequity in Datro. DunAn Environment has completed the equity transfer and industrial and commercial change registration procedures.Datro has been included in the consolidated scope of DunAn Environment.

(2) Cost and goodwill of business combination

Currency: CNY

DunAn Environment currently holds 65.95% of the equity in Datro. The enterprise merger cost is CNY244,597,668.00. The fair valueshare of identifiable net assets attributable to the parent company shareholders obtained is CNY62,667,044.92. The corresponding fairvalue of identifiable net assets was assessed by Zhonglian Appraisal Consulting (Shanghai) Co., Ltd. and an assessment report withthe number ZLHP Zi [2024] No. 20 was issued. The difference between the enterprise merger cost and the fair value share of identifiablenet assets attributable to the parent company shareholders of Datro forms goodwill of CNY181,930,623.08.

(3) Identifiable assets and liabilities of the acquiree on the acquisition date

Currency: CNY

Assets:

2. Business combination under the same control

None.

3. Reverse purchase

None.

4. Disposal of subsidiaries

Currency: CNY

AgriculturalDevelopmentCo., Ltd.

5. Change of combination scope for other reasons

Newly established entity in the current period:

Currency: CNY

(7) Significant changes or adjustments in the Company's business, products or services during the report period

□ Applicable ?Not Applicable

(8) Main sales customers and suppliers

Main sales customers of the Company

Information of top five customers

Sales

Other description of major customers

□ Applicable ?Not Applicable

Main suppliers of the Company

Information of top five suppliers

Other description of major suppliers

□ Applicable ?Not Applicable

3. Expenses

Currency: CNY

4. R&D investment

?Applicable □ Not applicable

markets, the Companyhas developed aresidential splitphotovoltaic storageair conditionerproduct.

multi-split operation,and promote the greentransformation of theindustry.

The brand-new livewater rinse technologyintegrates the rinseand spin-dryprocesses, shorteningthe washing time by40%. It achieves 360°all-round rinsingwithout dead cornersthrough the design of

machine with livewater spray has beendeveloped.

demagnetization, andlarge torque pulsationin deep weak magneticfield of high-powerreluctance motors, anew type of high-power reluctancemotor is developed tomeet the demands oflow-voltage industrialequipment and realizea series of high-efficiency andenvironmentallyfriendly reluctancemotor products.

gantry verticalmachining center forintegrated die-castingbody

Company R&D personnel

R&D investment of the Company

Reasons and influences of significant changes in the composition of R&D personnel in the Company

□ Applicable ?Not Applicable

Reasons for significant changes in the proportion of total R&D investment to the operating revenue compared with the previousyear

□ Applicable ?Not Applicable

Reasons for significant changes in capitalization rate of R&D investment and its reasonableness

□ Applicable ?Not Applicable

5. Cash flow

Currency: CNY

Description of the main factors affecting the significant year-on-year changes in relevant data?Applicable □ Not applicable

1. The net cash flow from operating activities decreased by 47.93% year-on-year, mainly due to changes in channel models andmarket conditions, among other factors.

2. The net cash flows from investing activities increased by 62.07% year-on-year, mainly due to the decrease in cash paid forinvestments.

3. The net cash flows from financing activities decreased by 44.90% year-on-year, mainly due to the decline in cash receivedfrom other financing activities-related sources.Reasons for significant differences between net cash flows from operating activities and net profit for the year during the reportperiod

□ Applicable ?Not Applicable

V. Analysis of non-main business

□ Applicable ?Not Applicable

VI. Analysis of assets and liabilities

1. Significant changes in the composition of assets

Currency: CNY

Item

Overseas assets account for a relatively high proportion.

□ Applicable ?Not Applicable

2. Assets and liabilities measured at fair value

?Applicable □ Not applicable

Currency: CNY

5.ReceivablesFinancing

Other changesOther changes mainly refer to the reclassification of financial statements, differences in foreign currency translation, and interestincome.Whether there was any significant change in the measurement attributes of the Company's major assets during the report period

□ Yes ?No

3. Restricted rights to assets at the end of the report period

Currency: CNY

VII. Analysis of investments

1. Overview

?Applicable □ Not applicable

2. Significant equity investments obtained during the report period

□ Applicable ?Not Applicable

3. Significant non-equity investments in progress during the report period

□ Applicable ?Not Applicable

4. Financial assets investments

(1) Securities investments

?Applicable □ Not applicable

Currency: CNY

Others

(2) Derivative investments

?Applicable □ Not applicable

1) Derivative investment for speculative purposes during the report period?Applicable □ Not applicable

Unit: CNY10,000

Risk analysis and descriptionof control measures forderivative positions during thereport period (including butnot limited to market risks,liquidity risks, credit risks,operational risks, legal risks,etc.)

2) Derivative investment for speculative purposes during the report period

□ Applicable ?Not Applicable

The Company has no derivative investment for speculative purposes during the report period.

5. Use of placements

□ Applicable ?Not Applicable

The Company had no use of placements during the report period.VIII. Significant assets and equity sales

1. Significant assets sales

□ Applicable ?Not Applicable

The Company did not sell any significant assets during the report period.

2. Significant equity sales

□ Applicable ?Not Applicable

IX. Analysis of main holding and joint-stock companies?Applicable ? Not applicableDuring the report period, the Company had no significant information on its major subsidiaries or associated companies thatshould be disclosed.

X. Structured entities controlled by the Company

□ Applicable ?Not Applicable

XI. Prospects for the future development of the Company(I) Development vision of the Company

The Company adheres to its corporate vision of "To create a world-class enterprise, achieving GREE's century-old brand." Guidedby Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, it remains true to its original aspiration, keeps itsmission firmly in mind, sticks to the real economy, and adheres to the road of self-reliance and independent innovation anddevelopment. Through innovation, responsibility, and green development, it contributes to the progress of human society, strivingto become a trusted global brand and create a better future for all.

(II) 2025 business plan

1. Focus on product-driven all-domain growth and multi-dimensional layout to facilitate marketingbreakthroughsDeepen terminal construction, actively respond to market demands, accelerate the renewal and upgrading of national full-categoryspecialty stores, and enhance brand image and market competitiveness. Build a precise product matrix and layout the market across

all price segments. Improve the brand ecosystem and explore new market areas. Focus on industries such as intelligent equipment,industrial robots, industrial products, and molds, and continuously explore the market potential of industrial products. At the sametime, we will continuously enhance the competitiveness of our products, optimize the overseas market layout, and facilitate marketbreakthroughs.

2. Firmly commit to scientific and technological innovation and continuously promote breakthroughs inkey core technologiesFocus on original technological innovation, comprehensively layout national and provincial-level innovation platforms, introduceintegrated product management systems, strengthen demand management and full life cycle management, and enhance the successrate of product development. Accelerate the digital transformation of laboratories and fully implement the new model of interactionamong testing, standards, and R&D. Continuously improve the high-value patent cultivation system, drive industrial upgradingwith technology, and promote breakthroughs in core technologies.

3. Strengthen quality management innovation and continuously leverage the advantages of the full-processquality control systemContinue to strengthen the concept of quality, accelerate the construction of smart laboratories and the research and promotion ofdigital detection technologies, and promote management innovation in the mode of interaction among testing, standards and R&D.Focus on the independent research and development of originality detection technology, and realize the application of originaltechnologies for automatic leak detection and automatic process inspection. Establish a comprehensive quality control systemcovering the entire process in new fields, continuously improve product quality, and help the "Perfect Quality Management Model"serve every consumer.

4. Promote the digital upgrade of the entire process and continuously deepen cost reduction and efficiencyimprovement

Accelerate the optimization of 5G private networks, consolidate the digital information foundation, continuously improve theproduction, supply and sales collaborative management platform, break down data barriers across multiple processes, achieve fulldigitalization of business processes, and promote cost reduction and efficiency improvement throughout the entire value chain.Continuously promote lean design of new products to achieve cost reduction from the source. Refine the analysis of long-termmaterials, shorten the material turnover period, reduce inventory risks, and enhance operational efficiency and cost controlcapabilities.

5. Focus on Party building leadership to promote high-quality development of enterprises

Adhering to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, we will advance theimplementation of the 16-character spirit from the Party Congress, namely "remember the entrustment, rally our forces, be gratefuland forge ahead, and grow together." Through conducting a diverse range of learning and educational activities, we will strengthenthe ideals and convictions of Party members, reinforce the leading role of Party building work, and continue to promote thestandardized construction of Party organizations and the implementation of mechanisms for managing and supervising Partymembers. This will provide a solid organizational guarantee for the high-quality development of GREE.

6. Implement the strategy of strengthening the enterprise with talents and forge a high-quality talent teamContinue to optimize the talent management mechanism, strengthen the orientation of promoting competent people and demotingthe mediocre, and stimulate the internal drive of the enterprise. Continue to deepen our recruitment channels, optimize therecruitment process, and build a comprehensive and refined recruitment system. For key groups such as middle and seniormanagement, core employees and skilled talents, customized and in-depth talent development programs are carried out to fully

empower business operations and provide high-quality talent supply for the stable development of the Company.

7. Comprehensively deepen audit and supervision, and improve the risk control system

Focus on the key areas of the Company, expand the scope of auditing, deeply explore potential problems, and ensure thetransparency and standardization of the Company's business operations. Strengthen financial management, apply informationtechnology means, and enhance financial security and risk management capabilities. Strengthen the network defense system, ensurethe efficient and controlled operation of information systems, build a comprehensive risk management and internal control system,enhance risk control, promote the rational and orderly development of various businesses, and facilitate long-term healthy growth.(III) Main risks to future development

1. Risk of macroeconomic fluctuations

The company's main products are home appliances and industrial equipment. At present, the domestic and international politicaleconomy is undergoing profound changes, and fluctuations in the economic cycle affect consumers' disposable income, consumerconfidence, and industrial capital expenditure, thereby affecting customers' demand and purchasing power for the company'sproducts and the company's business development and strategic decisions.

2. Risk of factor price fluctuations

The main raw materials for the company's products are copper, steel, aluminum, and plastic of various grades, which account for alarge proportion of the costs. Starting from 2020, the prices of copper, aluminum, and other raw materials have risen rapidly andremained high, so their cost pressure may have an impact on the company's operating results. As an industry leader with strongcentralized purchasing advantages, the Company will reduce the negative impact of raw material price fluctuations on its operationsthrough hedging, advance stocking, and material generalization.

3. Risk of intensified market competition

The home appliances market is highly competitive, with both domestic and international brands. It is expected that home applianceswill maintain intense competition in the future, and the evolution of the market competition is uncertain. If the Company fails toconsolidate and expand its original competitive advantages, it will face the risk of losing market share. The Company will increaseits investment in research and development, win praise from users through continuous independent innovation and high productquality, and establish a lasting brand influence.

4. Risk of overseas markets

The overseas market is influenced by the local political and economic situation, legal system, and regulatory system, and significantchanges in the above factors (if any) will pose risks to the company's overseas business. The Company has taken various measuresto mitigate the impacts, such as enhancing the competitiveness of export products, strengthening the cooperation with customersand distributors, and expanding overseas markets.

5. Risk of exchange rate fluctuations

With the internationalization of the Chinese yuan (CNY), the cross-border flow of capital in China is increasing, which willintensify the fluctuation of the CNY exchange rate. If the Company fails to take effective measures to avoid the risk of theappreciation of CNY, its profitability will be affected by exchange rate fluctuations. The Company will continuously enhance thebargaining power of its export products, as well as strengthen the analysis of exchange rate fluctuations, and use foreign exchangefinancial instruments to hedge and reduce exchange losses.In the face of complex and ever-changing internal and external environment and risks, the Company will continuously improve itscorporate governance structure, enhance its standard operation, and strengthen its internal control system in accordance with therequirements of the Company Law, Securities Law, and relevant laws and regulations of the China Securities RegulatoryCommission, to effectively prevent and control risks, ensuring the Company's sustainable, stable, and sound development.

The Company, along with the Board of Directors, sincerely thanks all shareholders, global customers, partners, and sectors ofsociety for their trust and support in Gree Electric Appliances. With great importance to the interests of all shareholders, the Boardof Directors will create long-term value for shareholders through stable operations.

XII. Activities such as reception of research, communication, and interviews during thereporting period?Applicable □ Not applicable

XIII. Formulation and implementation of the market value management system and thevaluation enhancement planHas the Company formulated a market value management system??Yes □NoHas the Company disclosed the valuation enhancement plan?

□ Yes ?No

To effectively promote the company's enhancement of investment value and shareholder return, strengthen and standardize thecompany's market value management, and safeguard the legitimate rights and interests of the Company and its investors, theCompany, according to relevant regulations such as the Regulatory Guidelines for Listed Companies No. 10 — Market ValueManagement issued by the China Securities Regulatory Commission, conducts the market value management based on thecompany's quality improvement and actual situation. The Company held the 24th Meeting of the 12th Board of Directors onDecember 31, 2024, to deliberate and approve the Proposal on Authorizing the Company's Management to Formulate the MarketValue Management System.XIV. Implementation of the action plan for "Double Improvement of Quality and Return"

Has the Company disclosed an action plan for "Double Improvement of Quality and Return"??Yes □NoFor details, please refer to the Announcement on Promoting the Implementation of the Action Plan for "Double Improvement ofQuality and Return" (Announcement No.: 2024-005) disclosed by the Company on February 19, 2024, on the designatedinformation disclosure media and CNINFO (http://www.cninfo.com.cn/new/index).

Section IV Corporate Governance

I. Basic status of corporate governanceThe Company, in strict accordance with the Company Law of the People's Republic of China, Securities Law of the People'sRepublic of China, and other relevant national laws and regulations, as well as the Self-regulatory Guidelines of Shenzhen StockExchange for Listed Companies No. 1 — Standardized Operation of Companies Listed on the Main Board, has established anormative corporate governance structure and rules of procedure for the general meeting of shareholders, Board of Directors, andBoard of Supervisors, clarified the responsibilities and authorities for decision-making, execution, and supervision to form aneffective division of responsibilities and balance mechanism, and continuously promoted the standardized operation to safeguardthe interests of investors and the Company.The company's governance complied with the Company Law of the People's Republic of China and the requirements of the ChinaSecurities Regulatory Commission regarding the governance of listed companies.Are there any significant differences between the actual state of corporate governance and the laws, administrative regulations,and regulations on governance of listed companies issued by the China Securities Regulatory Commission?

□ Yes ?No

There are no significant differences between the actual state of corporate governance and the laws, administrative regulations,and regulations on governance of listed companies issued by the China Securities Regulatory Commission.II. Independence of the Company from the controlling shareholder and the actual controllerin terms of assets, personnel, finance, organization, and business of the CompanyThe Company has a sound corporate governance structure, an independent and complete business operation, and independentmanagement capability, completely independent of the largest shareholder, Zhuhai Mingjun, in assets, personnel, finance,organization, and business.III. Horizontal competition

□ Applicable ?Not Applicable

IV. Annual general meeting of shareholders and extraordinary general meeting ofshareholders during the reporting period

1. General meetings of shareholders during the reporting period

and the designated media

2. Convening of an extraordinary general meeting of shareholders requested by the preferredshareholders with restored voting rights

□ Applicable ?Not Applicable

V. Directors, supervisors, and senior executives

1. Basic information

DuanXiufeng

Xiaohua

Are there cases of quit of directors and supervisors and dismissal of senior executives during the reporting period

□ Yes ?No

Changes in the company's directors, supervisors, and senior executives?Applicable □ Not applicable

2. Employment situation

Professional background, main work experience, and current major responsibilities of the Company's current directors, supervisors,and senior executivesMs. Dong Mingzhu, with a master's degree, currently serves as the chairperson of Gree Electric Appliances, Inc. of Zhuhai andsuccessively served as the salesperson, head of the Business Department, vice general manager, vice chairperson, and president ofthe Company.She was successively elected as a deputy of the 10th, 11th, 12th, 13th, and 14th National People's Congress, a member of the 10th,11th, and 12th Executive Committee of the All-China Women's Federation, a member of the 13th Five-Year Plan Expert Committeeof the National Development and Reform Commission, a member of the Advisory Committee of the All-China Federation ofIndustry and Commerce, a United Nations Ambassador for Sustainable Urban Development, the first rotating chairperson of the

UNDP Commission on Sustainable Development, and the chairperson of the ISO/TC86/SC4.She was awarded the "National Model Worker", "National May 1 Labor Medal", "National March 8th Red Banner Pacesetter",expert enjoying the special allowance of the State Council, China Patent Gold Award, the Third China Quality Award, ChinaStandard Innovation and Contribution Award, and other honors and titles, and has been selected by CCTV as "Economic Personalityof the Year" for three times, and was listed in Fortune "2019 World's Most Influential Women in Business" and "2024 Top 100China's Outstanding Women in Business". Additionally, she has been included in Fortune's "World's Most Influential Women inBusiness" and "China's Most Influential Women in Business" for many consecutive years.Mr. Zhang Wei, a senior economist with a bachelor's degree, currently serves as the secretary of the party committee,director, and president of Gree Electric Appliances, Inc. of Zhuhai.He joined Gree Electric Appliances, Inc. of Zhuhai in 1999 and successively served as the head of the Gree Electric AppliancesPipeline Branch, Material Supply Department, Outsourcing and Purchasing Quality Management Department, BusinessManagement Department, and assistant president. He served as vice president of Zhuhai Gree Group Co., Ltd. from 2013 to 2020and has served as a director of the Company since January 2019, the secretary of the party committee of the Company sinceSeptember 2020, and the president of the Company since April 2025.Mr. Zhang Jundu, with a junior college degree, currently serves as a director of Gree Electric Appliances, Inc. of Zhuhai.He has served as the chairman of Zhejiang Tongcheng Gree Electric Appliances Co., Ltd. since September 1999, the executivedirector and general manager of Zhejiang Shengshi Xinxing Gree Trade Co., Ltd. since August 2012, and a director of the Companysince May 2012.Mr. Shu Lizhi, with a master's degree, currently serves as a director of Gree Electric Appliances, Inc. of Zhuhai.He previously served as the deputy director and director of the Wuhan Special Commission Office of the National Audit Office.He joined Gree Electric Appliances, Inc. of Zhuhai in December 2019 and served as the vice president of the Company fromDecember 2020 to April 2025. He has served as a director of the Company since April 2025.Mr. Zhong Chengbao, a senior electrical engineer with a master's degree, currently serves as a director, chief engineer, andassistant president of Gree Electric Appliances, Inc. of Zhuhai.He was an outstanding young talent of Zhuhai and executive deputy director of "Guangdong Provincial Key Laboratory of High-Performance Servo System Enterprises" and obtained a bachelor's degree in mechanical design, manufacturing, and automationfrom Harbin Institute of Technology in 2008 and a master's degree in computer science and technology from Beijing Institute ofTechnology in 2024. He joined the Company in 2008 and has successively served as a technician, the leader of the technical researchgroup, the director of the research institution, and the president of the research institute. Additionally, he has served as the assistantpresident of the Company since February 2024, the chief engineer of the Company since February 2025, and a director of theCompany since April 2025.Mr. Zhang Qiusheng, with a doctoral degree, is a non-practicing member of the Chinese Certified Public Accountant. He iscurrently a professor at the School of Economics and Management of Beijing Jiaotong University, the director of the NationalInstitute of Transportation Development, the director of the China Center for Corporate Mergers and Acquisitions, and anindependent director of CMST Development Co., Ltd. and Luoniushan Co., Ltd.He has undertaken various provincial and ministerial research projects from the National Natural Science Foundation of China, theNational Social Science Fund of China, the National Soft Science Program, as well as the Ministry of Education, the Ministry ofFinance, the State-owned Assets Supervision and Administration Commission of the State Council, and the China SecuritiesRegulatory Commission. He has published more than 30 works (translations) including the monograph A Framework for Mergers

and Acquisitions and more than 100 academic and professional papers and has won a second prize for national teachingachievements, four awards for provincial and ministerial research achievements, and two first prizes for teaching achievements inBeijing.Mr. Cheng Ming, with a doctoral degree, currently serves as the chief professor of Southeast University, the director of theAcademic Committee of the School of Electrical Engineering, the director of Jiangsu Provincial Engineering Laboratory for NewEnergy Vehicle Motors and Drive Systems, and an independent director of Gree Electric Appliances, Inc. of Zhuhai and ShandongJindi Precision Machinery Technology Co., Ltd.He has worked at Southeast University since 1987 and successively served as the president of the School of Electrical Engineeringof Southeast University and a member of the 10th Academic Committee of Southeast University. He served as an independentdirector of Wuxi Xinje Electric Co., Ltd. from January 2013 to December 2018 and has served as an independent director ofShandong Jindi Precision Machinery Technology Co., Ltd. since January 2021. He won the Second Prize of the NationalTechnological Invention Award in 2016 (ranked first), the First Prize of the Natural Science Award of the Ministry of Educationin 2013 (ranked first), the First Prize of the Natural Science Award of the Ministry of Education in 2022 (ranked first), the FirstPrize of Jiangsu Science and Technology Award in 2019 (ranked first), and the Jiangsu Patent Inventor Award in 2019.Mr. Li Hongqi, with a doctoral degree, currently serves as an independent director of Gree Electric Appliances, Inc. of Zhuhai.He has been engaged in scientific research and teaching in refrigeration, air conditioning, and compressors, including energyconservation and environmental protection technologies of refrigeration and air conditioning equipment and its application. He hasedited and co-edited 18 books, published over 160 papers, and participated in the formulation of more than 30 national energyefficiency standards and other national and industry standards. He previously served as a professor in the Department ofRefrigeration and Cryogenic Engineering at Beijing University of Technology, a member of the Chinese Association ofRefrigeration and its Academic Committee, a member of the Technical Committee of the China Refrigeration and Air ConditioningIndustry Association and vice president of its Pump Branch, a member of SAC/TC238, a vice chairman of SAC/TC145, a memberof SAC/TC119 and TC119/SC7, and a member of the Chinese expert group for the implementation of the Montreal Protocol onSubstances that Deplete the Ozone Layer.Mr. Weng Guomin, with a doctoral degree, currently serves as a professor at the School of Economics of Zhejiang University andan independent director of Gree Electric Appliances, Inc. of Zhuhai, Ningbo United Group Co., Ltd., and Great MicrowaveTechnology Co., Ltd. He previously served as an assistant lecturer, lecturer, and associate professor at the Law Department ofHangzhou University, a professor at the Law School of Zhejiang University, and a professor at the Guanghua Law School ofZhejiang University.Ms. Cheng Min, with a bachelor's degree, currently serves as the vice president of Zhuhai Gree Group Co., Ltd., the chairman ofZhuhai Gexin Development Co., Ltd., and the chairman of the Board of Supervisors of Gree Electric Appliances, Inc. of Zhuhai,and successively served as the head of the Planning Department of Zhuhai Exhibition and Convention Bureau, a member of theParty Group of Zhuhai Exhibition and Convention Bureau, and the office director and secretary of the Board of Directors of ZhuhaiGree Group Co., Ltd.Mr. Duan Xiufeng currently serves as a supervisor of Gree Electric Appliances, Inc. of Zhuhai.Graduated from Shandong Party School in 1999, he has served as a supervisor of the Company since January 2019 and successivelyserved as the vice general manager and general manager of Shandong Gree Electric Appliance Marketing Co., Ltd. and generalmanager of Shandong Shengshi Xinxing Gree Trade Co., Ltd.Mr. Shao Liguo, a senior engineer with a master's degree, currently serves as the employee representative supervisor and the headof the Business Management Department of Gree Electric Appliances, Inc. of Zhuhai.

He has successively served as a technician, supervisor, and assistant head of the Production Planning Department, assistant managerand manager of the 4th Air Conditioning Branch, general manager of Gree Electric Appliances (Hefei) Co., Ltd., and head of theEquipment and Power Department.Mr. Fang Xiangjian, a senior engineer with a master’s degree, currently serves as the vice president of Gree Electric Appliances,Inc. of Zhuhai.He served as an analyst and head of the department of the Screening Branch from July 2001 to June 2004, an assistant manager,vice manager, and manager of the Screening Branch, and head of the Quality Control Department from July 2004 to December2016, an assistant president of the Company from December 2016 to November 2021, and has served as the vice president of theCompany since November 2021.He won the Guangdong May 1 Labor Medal, the Liu Yuanzhang Quality and Technical Talent Award of the China Association forQuality, the Management Talent Award of the China Management Science Society, and the High-level Talent of Zhuhai. Heconcurrently serves as the vice president of the China Association for Quality Inspection, the vice chairman of the 11th Board ofDirectors of the Chinese Association of Refrigeration, the member of the 5th Technical Committee of the China Refrigeration andAir Conditioning Industry Association, the chairman of the 2nd GD/TC94, a member of the 7th Academic Committee and theReliability Promotion Committee of the China Association for Quality, the vice chairman of the Green and Efficient Energy-usingProduct Professional Committee of the China Energy Conservation Association, a professional member of the China Fire ProtectionAssociation, a member of Board of Directors of the China Management Science Society, vice president of the GuangdongAssociation for Quality, etc.Mr. Liu Hua, a professor-level senior engineer with a doctoral degree, currently serves as the vice president of Gree ElectricAppliances, Inc. of Zhuhai.He served as the designer, group leader, director, assistant head, and vice head of the Commercial Technology Department fromMarch 2003 to February 2017, the assistant chief engineer of the Company from February 2017 to October 2017, the assistantpresident of the Company from October 2017 to April 2025, and has served as the vice chief engineer of the Company since October2017 and the vice president of the Company since April 2025.He presided over two projects/topics of the National Key Research and Development Program, won the Second Prize in the NationalTechnological Invention Award, the Gold Award for Chinese Patent, the First Prize of Science and Technology Progress ofGuangdong Province, and other scientific and technological awards, selected as a leading talent in scientific and technologicalinnovation under the National "Ten Thousand Talents Program" and an expert enjoying the special government allowance of theState Council, and received honors such as the "Top Ten Outstanding Inventors of Guangdong Province", "Model Worker ofGuangdong Province", and "Outstanding Communist Party Member of Guangdong Province". He concurrently serves as the vicepresident of the Building Environment and Energy Utilization Branch of the China Engineering & Consulting Association, vicedirector of the Professional Committee on Thermal Utilization of the China Renewable Energy Society, vice president of theInstitute of Heating, Ventilation and Air Conditioning, China Association of Building Energy Efficiency, etc.Mr. Li Shaobin, a senior engineer with a master's degree, currently serves as the vice president of Gree Electric Appliances, Inc.of Zhuhai.He has successively served as the assistant head and minister of the Commercial Air Conditioning Design and DevelopmentDepartment of the company, and assistant to the president of the company. Has served as the assistant to the chief engineer of thecompany since February 2017. Has served as the vice president of the company since April 2025. He concurrently serves as thevice director of the National Engineering Research Center of Green Refrigeration Equipment, a review expert for the "QimingProgram" of the Ministry of Industry and Information Technology, and an expert (first batch) included in the expert database of the

Department of Industry and Information Technology of Guangdong Province. He has also been awarded the Outstanding Inventorof Guangdong Province and High-level Talent of Zhuhai.Mr. Hu Yusheng, with a doctoral degree from Harbin Institute of Technology, is a professor-level senior engineer and currentlyserves as the vice president of Gree Electric Appliances, Inc. of Zhuhai.He has successively served as the technician and head of the Refrigeration Technology Research Institute, the head, assistantpresident, vice president, and president of the Mechanical and Electrical Technology Research Institute from July 2004 to December2017, the assistant chief engineer of the Company since December 2017, the assistant president of the Company from April 2019to April 2025, and the vice president of the Company since April 2025.He has been honored as a Leading Talent in Scientific and Technological Innovation among the middle-aged and young talentsunder the National Ten Thousand Talents Program, an expert enjoying the special government allowance of the State Council, anOutstanding Young Engineer, and one of the Top Ten Outstanding Inventors of Guangdong Province.Mr. Wang Kai, with a master's degree from the Criminal Investigation Police University of China, currently serves as the vicepresident of Gree Electric Appliances, Inc. of Zhuhai.He has successively served as the assistant president of the Company from February 2019 to April 2025 and the vice president ofthe Company since April 2025. He once worked at the Public Security Bureau of Shenzhen Municipality, holding positions suchas the head of the Intelligence Division of the Anti-Terrorism Detachment.He has been awarded the Second-Class Merit once and the Third-Class Merit twice, and received multiple commendations. He hasalso been honored with the United Nations Peace Medal, the Ministry of Public Security Peacekeeping Medal, the OutstandingPeople's Police Officer of Guangdong Province, the Advanced Individual in Political Work of the Guangdong Provincial PublicSecurity Department, the Advanced Individual in Anti-Terrorism Work of Shenzhen City, and the Gold Medal of the Public SecurityBureau of Shenzhen Municipality.Mr. Liao Jianxiong, with a bachelor's degree, currently serves as the chief financial officer and assistant president of GreeElectric Appliances, Inc. of Zhuhai.He joined GREE in May 1993 and successively served as the head of the Finance Department of Gree Electric Appliances(Chongqing) Co., Ltd. and the head of the Finance Department of Gree Electric Appliances, Inc. of Zhuhai. He has served as thechief financial officer and assistant president of the Company since August 2020.Mr. Zhang Zhouhu, with a bachelor's degree, currently serves as the board secretary of the Board of Directors of Gree ElectricAppliances, Inc. of Zhuhai.He joined the Company in July 2007 and successively served as the head of the Finance Department of Gree (Wuhu) ElectricAppliances Co., Ltd., the head of the Finance Department of Gree (Hefei) Electric Appliances Co., Ltd., the securities affairsrepresentative and assistant head of the Investment Management Department of Gree Electric Appliances, Inc. of Zhuhai, and thevice president and secretary of the Board of Directors of Zhejiang DunAn Artificial Environment Co., Ltd. He has served as thesecretary of the Board of Directors of the Company since January 2025.Employment in Shareholders?Applicable □ Not applicable

Group Co., Ltd.

Employment in other companies?Applicable □ Not applicable

Tongcheng GreeElectricAppliances Co.,Ltd.

Ltd.

Penalties imposed by securities regulators on incumbent and resigned directors, supervisors, and senior executives in thereporting period in the recent three years

□ Applicable ?Not Applicable

3. Remuneration of directors, supervisors, and senior executives

Decision-making procedures, determination basis, and actual payment regarding the remunerations of directors, supervisors, andsenior executivesDuring the reporting period, to improve the incentive and restraint mechanism, mobilize the enthusiasm and creativity of directors,supervisors, and senior executives, and enhance the operating efficiency and business benefits of the Company, the remunerationprograms for directors, supervisors, and senior executives of the Company are formulated based on the actual situation of theCompany and factors such as remuneration, allowances, and job contributions in the industry and region.(I) Remuneration program for directors

1. Allowance program for independent directors

The Company provides appropriate allowances to independent directors, that is CNY200,000 per person per year (before tax).

2. Remuneration program for non-independent directors

Non-independent directors who hold positions other than directors in the Company receive remuneration based on their actualpositions and duties in the Company, but no separate director allowances are provided.Non-independent directors who do not hold positions other than directors in the Company do not receive remuneration from theCompany or separate director allowances.(II) Remuneration program for supervisorsSupervisors who do not hold positions other than supervisors in the Company do not receive remuneration from the Company orseparate supervisor allowances.Employee representative supervisors receive remuneration based on their actual positions and duties in the Company, but noseparate supervisor allowances are provided.(III) Remuneration program for senior executivesThe Company assesses the performance of senior executives in terms of "morality, ability, diligence, and achievement", and the

remuneration program is formulated by the Board of Directors based on the industry situation.Remuneration of directors, supervisors, and senior executives in the reporting period

Unit: CNY10,000

Explanation of other situations

□ Applicable ?Not Applicable

VI. Performance of directors' duties during the reporting period

1. Description of the Board of Directors during the reporting period

18th Meeting of the 12th Board ofDirectors (Announcement No.: 2024-006) on CNINFO(http://www.cninfo.com.cn/new/index)

2. Attendance of directors at meetings of the Board of Directors and general meetings of shareholders

DengXiaobo

Explanation of absence from meetings of the Board of Directors for consecutive two times

3. Directors' objection to relevant matters of the Company

Do the directors raise any objections to relevant matters of the Company?

□ Yes ?No

The directors don't raise any objections to relevant matters of the Company.

4. Other descriptions for performance of duties by directors

Are the directors' suggestions on the Company adopted??Yes □NoDescription of adoption or rejection of directors' suggestions on the CompanyDuring the reporting period, the directors of the Company took the best interests of the Company and shareholders as their code ofconduct, faithfully performed their duties according to relevant regulations, attended the meetings of the Board of Directors andgeneral meeting of shareholders, carefully deliberated the proposals, and made suggestions and comments on the management ofthe Company, which played a positive role in effectively making decisions by the Board of Directors, improving the managementlevel, and standardizing the operation of the Company.VII. Special committees under the Board of Directors during the reporting period

Report

VIII. Work of the Board of SupervisorsDoes the Board of Supervisors identify any risks in the Company through supervision during the reporting period?

□ Yes ?No

The Board of Supervisors has no objection to the supervision matters during the reporting period.IX. Company's staff

1. Number of employees, their specialties, and educational background

Total

2. Remuneration policy

During the reporting period, the Company attached great importance to and safeguarded the vital interests of employees, optimizedand adjusted remuneration programs, and continuously improved the position-based and performance-oriented remunerationmechanism. Additionally, the Company, taking high-quality talents as the core, improved the rationality of the salaries of coregroups, motivated scientific and technological personnel for breakthroughs, reformed the wage system, and built careerdevelopment channels for employees based on a professional assessment to establish a reasonable, flexible, and effective salarysystem, optimize the construction of the talent team, and enhance the organizational effectiveness.

3. Training plan

(1) Training comprehensive technical management talent to promote the growth and development of employeesTraining key talents and enhancing their comprehensive quality and ability. The Company conducted the advanced trainingof newly appointed middle-level managers through the mechanism of "foundation-improvement-strengthening", to accelerate thetransformation of roles and thinking and enhance management level and professional ability; established the "Cornerstone Plan"supervisor training camp and the "Spark Plan" team leader training camp and formulated targeted training plans from aspects suchas management role positioning and compliance risk control, to improve the comprehensive quality and ability of nearly 300 low-level managers; and organized the "Starlight GREE" 2024 college student induction training and the "Let Your Dreams Set Sail"new employee induction training, and systematically developed the training content from aspects such as values and business skills,to build consensus and cultural understanding, enhance the employer brand, and solidify the foundation for the long-termdevelopment of new employees.Providing integrated learning resources and constructing a learning organization. Adhering to the concept of "Training People onBoth Virtue and Skills", the Company carried out the "Inventive Mind · GREE Good Lecturer" competition and set up both onlineand offline learning channels, to discover outstanding lecturers and develop high-quality courses with topics closely related tobusiness and authentic content. Relying on the online GREE learning platform, it enhanced the digital construction of learningresources and pushed regular and phased learning for all employees in terms of general abilities, professional knowledge, andquality courses to achieve precise delivery of learning resources. Based on a four-level training system covering the company,departments, sections, and individuals, it provided open classes for all employees and special training on key businesses such astechnology research and development, production management, product planning, and sales expansion. The company has conductednearly 6,000 special training at all levels and promoted the transmission of learning experiences and corporate culture through thedeep integration of digital platforms and systematic management.

(2) Training practical skilled talents to support enterprises in their transformation towards intelligent manufacturingBuilding a demonstration base for skill training relying on the policy advantages. Based on the support policies for thecultivation of skilled talents issued by the state, provinces, and cities, the Company initiatively and actively coordinated variousresources to build a national-level standard high-skilled talent training base covering multiple professional fields, playing anexemplary role of skilled talent training. Awarded the qualification of core enterprises in the "industry-education-evaluation"ecosystem in Guangdong Province, it optimized the industry-education integration system and successively completed the courseoutlines for multiple jobs, providing talent support for developing new quality productive forces with practical actions. It obtainedthe approval and promoted the construction of the Craftsmanship College, and integrated high-quality internal and external lecturers,venues, and other resources to provide comprehensive and high-quality skilled talent support for improving the skill levels ofemployees, optimizing the industrial chain and supply chain, and transforming traditional industries through measures such as skill

training, master-apprentice programs, skill competitions, and skill level evaluations.Supporting the improvement of skilled talents and revitalizing the enterprise with strong skills. Adhering to the significant role ofskilled talents in strengthening and revitalizing enterprises, the Company comprehensively upgraded the labor skill competitionsin 2024, including front-line operation skills, production quality and lean production skills, and equipment operation andcommissioning skills, to promote the transformation of employees' skills from traditional manual operations to equipment operationand automation and create an atmosphere of learning from, respecting, and striving to become skilled talents.

(3) Improving the after-sales talent training system to expand after-sales service and global businessTransforming the domestic market-oriented service and constructing the after-sales talent team. To comprehensivelyenhance the professional capabilities and service quality of domestic after-sales services, with the aim of "data interaction andbusiness collaboration", in terms of pre-job training, the Company established a full-process talent training model covering pre-jobtraining, examination & evaluation, and permission to work assignment relying on the linkage between the after-sales system andthe training system, providing a strong guarantee for after-sales service of eight major categories of products, including residentialair conditioners, residential central air conditioners, kitchen appliances, refrigerators, washing machines, etc. In terms of safety andtechnical training, the Company enhanced the acceptance and the investigation of potential safety hazards by front-line after-salespersonnel through the "Safety First" safety education campaign, trained and appointed safety instructors with the goal of "Beginningwith the End in Mind and Training based on Required Skills", and based on after-sales data analysis, focused on high-frequencyfaults and built "Perfect Journey · Bright Future" after-sales high-skilled talent training camp to enhance the safety awareness andprofessional capabilities of the after-sales service team. In terms of training skilled talents, to construct a highly skilled after-salesservice team, the Company organized nearly 5,000 after-sales service teams across the country to participate in the "GREE Cup"household service skill competition, showcasing the professional skills and high-quality services of GREE's after-sales service. Inaddition, relying on the three-level after-sales training system, combined with business development and after-sales issues, it trainedover 500,000 personnel throughout the year, supporting after-sales personnel in enhancing their professional skills and providinggood service guarantees.Promoting the internationalization upgrade of our brands and expanding overseas business. To support the construction ofthe company's self-owned brands and the development of overseas business, the Company conducted precise product and technicaltraining for more than 100 agents in eight major regions including North America, Latin America, the Middle, East, etc. throughvarious modes such as remote live streaming, global training, and in-factory training. Meanwhile, to promote communication andcollaboration among global partners, a "GREE Overseas After-sales Technical Exchange Seminar" was held at the headquarters ofGree Electric Appliances for global agents, promoting technical exchanges and brand value transmission. Additionally, to satisfythe requirements for talent development in Hong Kong and Macao, based on its advantages in the refrigeration industry, theCompany organized special training on air conditioner maintenance and repair skills for personnel in Hong Kong and Macao,promoting the highly skilled talent training and win-win cooperation in Zhuhai, Hong Kong, and Macao.

4. Labor outsourcing

□ Applicable ?Not Applicable

X. Profit distribution and conversion of capital reserves into share capital by the Company

Profit distribution policy during the reporting period, especially the formulation, implementation, or adjustment of the cashdividend policy?Applicable □ Not applicableAccording to the Shareholder Return Plan for 2022 to 2024, the Company can make two profit distributions each year from 2022

to 2024, namely the annual profit distribution and the interim profit distribution. On the premise that the company's cash flow meetsits normal operation and long-term development, the company's cash dividend per share for each year from 2022 to 2024 is not lessthan CNY2 or the total cash dividend is not less than 50% of the net profit attributable to shareholders of listed companies asaudited in the current year.On April 29, 2024, the 18th Meeting of the 12th Board of Directors deliberated and approved the Annual Profit Distribution Planfor 2023. On June 28, 2024, this plan was deliberated and approved by the company's Annual General Meeting of Shareholders in2023 as follows: With the shares after deducting the 109,462,095 shares in the repurchase account from the Company's total sharecapital of 5,631,405,741 shares as the base quota, a cash dividend of CNY23.80 (tax inclusive) is distributed to all shareholders forevery 10 shares, without bonus shares or conversion of capital reserves into share capital, totaling CNY13,142,225,877.48distributed. This plan was completed on August 28, 2024.On December 31, 2024, the 24th Meeting of the 12th Board of Directors deliberated and approved the Interim Profit DistributionPlan for 2024. On April 22, 2025, this plan was deliberated and approved by the 1st Extraordinary General Meeting of Shareholdersin 2025 as follows: With the shares after deducting the 79,462,095 shares in the repurchase account from the Company's total sharecapital of 5,601,405,741 shares as the base quota, a cash dividend of CNY10 (tax inclusive) is distributed to all shareholders forevery 10 shares, without bonus shares or conversion of capital reserves into share capital, totaling CNY5,521,943,646.00 distributed.If there is a change in the total share capital of the Company entitled to profit distribution from the date of disclosure of thedistribution plan to the date of implementation of equity distribution registration, the Company will adjust the total dividendaccordingly based on the principle of keeping the distribution ratio per share unchanged.The cash dividend distribution proportion of the Company since its listing is in line with the provisions of the Articles of Associationof Gree Electric Appliances, Inc. of Zhuhai and the cash dividend distribution policy of the Company is in line with the provisionsof laws and regulations such as the Articles of Association of Gree Electric Appliances, Inc. of Zhuhai and the resolutions of thegeneral meeting of shareholders. The dividend distribution criteria and the dividend distribution ratio are clear and distinct, therelevant decision-making procedures and mechanisms are complete, and the independent directors have performed their duties andresponsibilities with due diligence and have played their roles. Minority shareholders have adequate opportunities to express theiropinions and demands on profit distribution, and their legitimate rights and interests are fully protected.

The Company is profitable during the reporting period and the parent company has positive profit available for distribution toshareholders, without the cash dividend distribution plan proposed

□ Applicable ?Not Applicable

Profit distribution and conversion of capital reserves into share capital during the reporting period?Applicable □ Not applicable

XI. Implementation of the Company's equity incentive plan, employee stock ownershipplan, or other employee incentive measures?Applicable □ Not applicable

1. Equity incentive

Not applicableEquity incentives received by directors and senior executives of the Company

□ Applicable ?Not Applicable

Appraisal mechanism and incentives of senior executivesNot applicable

2. Implementation of employee stock ownership plan

? Applicable ? Not Applicable

(1) On July 30, 2024, the Company held a meeting of the holders of the Phase II employee stock ownership plan to deliberate andapprove the Proposal on the Termination of the Phase II Employee Stock Ownership Plan and the Continued Fulfillment of theVoluntary Lock-up Period Commitment. Therefore, the Phase II employee stock ownership plan was terminated ahead of schedule.According to the Phase II employee stock ownership plan approved by the general meeting of shareholders, after the shares aretransferred to the individual security accounts of the holders, the holders are not allowed to sell or set up pledges before May 1,2032. Otherwise, the labor union has the right to recover the income from relevant shares.

(2) On August 2, 2024, the Company held the 19th Meeting of the 12th Board of Directors and the 16th Meeting of the 12th Boardof Supervisors to deliberate and approve the Proposal on the Phase III Employee Stock Ownership Plan (Draft) of Gree ElectricAppliances, Inc. of Zhuhai. Additionally, on August 19, 2024, it held the 1st Extraordinary General Meeting of Shareholders in2024 to deliberate and approve the Proposal on the Phase III Employee Stock Ownership Plan (Draft) of Gree Electric Appliances,Inc. of Zhuhai. According to the regulations on the implementation of the 2023 annual equity distribution plan and the Phase IIIemployee stock ownership plan, the Company held the 21st Meeting of the 12th Board of Directors and the 18th Meeting of the12th Board of Supervisors on September 20, 2024, to deliberate and approve the Proposal on Adjusting the Purchase Price in thePhase III Employee Stock Ownership Plan Due to the Distribution of Dividends during the Execution Period. The Companytransferred 63,195,095 shares to the special account of the Phase III Employee Stock Ownership Plan of Gree Electric Appliances,Inc. of Zhuhai through a non-trading transfer on January 21, 2025.

3. Other employee incentive measures

□ Applicable ?Not Applicable

XII. Establishment and implementation of the internal control system during the reportingperiod

1. Establishment and implementation of internal control

During the reporting period, the Company established, improved, and effectively implemented internal control in accordance withthe provisions of the internal control system. The Board of Supervisors supervised the establishment and implementation of internalcontrol by the Board of Directors. The managers were responsible for the daily operation of internal control. The Companymaintained effective internal control in all major aspects in accordance with the requirements of the internal control system andrelevant regulations, without any significant deficiencies in internal control in financial statements. The purpose of internal controlis to ensure the legality and compliance of operation and management, the safety of assets, and the authenticity and completenessof financial statements and related information, improve operational efficiency and effectiveness, and promote the realization ofdevelopment strategies.

2. Details of significant deficiencies in internal control identified during the reporting period

□ Yes ?No

XIII. Management and control of the subsidiaries during the reporting period

□ Applicable ?Not Applicable

XIV. Internal control evaluation report or internal control audit report

1. Internal control evaluation report

control evaluation report

2. Internal control audit report

?Applicable □ Not applicable

Does the accounting firm issue an internal control audit report with non-standard opinions?

□ Yes ?No

Are the opinions in the internal control audit report issued by the accounting firm consistent with those in the Board of Directors'self-evaluation report??Yes □NoXV. Rectification of self-inspection issues in the special governance of listed companiesNot applicable

Section V Environmental and Social ResponsibilityI. Major environmental issuesAre the listed company and its subsidiaries listed as key pollutant discharge companies published by the environmental protection department??Yes □NoEnvironmental protection policies and industry standardsDuring the production and operation process, the Company and its subsidiaries strictly complied with the requirements of environmental protection laws and regulations such as theEnvironmental Protection Law of the People's Republic of China, Law of the People's Republic of China on the Prevention and Control of Atmospheric Pollution, Law of the People'sRepublic of China on the Prevention and Control of Water Pollution, Law of the People's Republic of China on the Prevention and Control of Solid Waste Pollution, Law of the People'sRepublic of China on Prevention and Control of Environmental Noise Pollution, Law of the People's Republic of China on Prevention and Control of Soil Pollution, and EnvironmentalImpact Assessment Law of the People's Republic of China, and strictly followed the national, local, and industry environmental protection and emission standards such as Discharge Limitsof Water Pollutants (DB 44/26-2001), Emission Standard of Volatile Organic Compounds for Furniture Manufacturing Operations (DB 44/814-2010), Takeover Standard of WastewaterTreatment Plant in West Area of Hefei, Integrated Wastewater Discharge Standard (GB 8978-1996), Discharge Standard of Water Pollutants for Electroplating (DB 44/1597-2015), EmissionStandard of Volatile Organic Compounds for Printing Industry (DB 44/815-2010), Emission Limits of Air Pollutants (DB 44/27-2001), Emission Standard of Air Pollutants for IndustrialKiln and Furnace (GB 9078-1996), Emission Standard of Volatile Organic Compounds for Surface Coating of Automobile Manufacturing Industry (DB 44/816-2010), Emission Standard ofPollutants for Synthetic Resin Industry (GB 31572-2015), and Emission Standards for Odor Pollutants (GB 14554-1993).Administrative license for environmental protectionThe Company and its subsidiaries strictly implemented the pollution discharge permit system and legally discharged pollutants within the specified scope.

Industry discharge standards and specific situations of pollutant discharge involved in production and business activities

Name ofCompany or

Subsidiary

Name ofCompany orSubsidiary

Name ofCompany or

Subsidiary

Name ofCompany orSubsidiary

Name ofCompany or

Subsidiary

Name ofCompany orSubsidiary

Name ofCompany orSubsidiary

Name ofCompany or

Subsidiary

Name ofCompany orSubsidiary

Name ofCompany or

Subsidiary

Name ofCompany or

Subsidiary

Name ofCompany orSubsidiary

Name ofCompany orSubsidiary

Name ofCompany orSubsidiary

Name ofCompany or

Subsidiary

Name ofCompany orSubsidiary

Name ofCompany orSubsidiary

Treatment of pollutants

1. Wastewater pollution prevention and control facilities

The Company and its subsidiaries are equipped with proper wastewater treatment facilities and full-time environmentalmanagement, operation, and monitoring personnel in accordance with the environmental protection requirements of theconstruction project. So far, the systems are in normal operation and the discharge is conducted in a stable and standardized mannerwithout excessive discharge.

2. Exhaust gas pollution prevention and control facilities

The exhaust gas pollution prevention and control facilities of the Company and its subsidiaries operate normally, and the indicatorsof exhaust gas monitoring comply with national and local emission standards, without excessive discharge.

3. Solid waste treatment and disposal facilities

The Company implements the classification and collection system of hazardous waste and entrusts the disposal to the organizationwith a proper disposal qualification. General industrial solid wastes are handed over to resource recycling manufacturers forrecycling and disposal after being classified in the factory, and there is no illegal disposal.Environment self-monitoring schemeThe Company and its subsidiaries formulate self-monitoring schemes according to the requirements of pollutant discharge permitsand environmental impact assessment and entrust third-party qualified testing organizations to carry out environmental monitoring.Online automatic monitoring is applied for key discharge ports, and data is uploaded online to local ecological and environmentalauthorities for real-time management.Environmental emergency planTo implement the requirements of the national Measures on Environmental Emergency Management and related laws andregulations, deal with environmental emergencies in a timely, orderly, efficient, and appropriate manner, protect the personal safetyof the employees, and reduce property losses, the Company and its subsidiaries formulate an environmental emergency plan andreport it to the environmental protection department for filing.Investment in environmental governance and protection and payment of environmental protection taxes

Unit: CNY10,000

Measures taken to reduce carbon emissions and results during the reporting period?Applicable □ Not applicableThe Company attaches great importance to energy conservation and emission reduction. With the vision of "making the sky bluer

and the earth greener", it has always adhered to the development concept of "lucid waters and lush mountains are invaluable assets"and actively responded to the national "dual carbon (carbon peaking and carbon neutrality)" strategy. Additionally, as a domestic"photovoltaic" and "zero-carbon" air conditioner technology leader, it is committed to promoting clean and low-carbon energyconsumption in production and operation and creating a healthy and green quality of life for consumers and society.The Company has continuously performed the review of greenhouse gas emissions at the company level and implemented carbonreduction measures, including vigorously developing photovoltaic power generation, constantly investing in energy-savingtechnological transformation, and continuously enhancing resource regeneration and recycling, to effectively reduce the Company'stotal carbon emissions. In 2024, the Company implemented 392 energy-saving technological transformation projects, reducingelectricity consumption by approximately 58,344,000 kWh, natural gas consumption by 285,000 m

, and carbon dioxide emissionsby 31,925 t.In 2024, the Company utilized 708,763,000 kWh of nuclear power and 96,850,000 kWh of photovoltaic power with an increase of245% compared to 2023, reducing carbon dioxide emissions by 51,969.7 t. Combined with the lithium titanate energy storagecabinet independently developed by GREE for load shifting, 180 MWh of energy was stored, and 75 million kWh of electricitywas shaved in peak.Administrative penalties for environmental issues during the reporting period

Other environmental information that should be disclosedNone.Other environmental protection informationNone.II. Social responsibilityIn 2024, Gree Electric Appliances actively fulfilled its responsibilities in environmental protection, social responsibility, andcorporate governance, especially in intelligent manufacturing, green innovation, and safeguarding the rights and interests ofstakeholders, and fulfilled the mission of promoting the sustainable development of the industry. (For details, please refer to the2024 Environmental, Social, and Governance (ESG) Report published by the Company on CNINFO(http://www.cninfo.com.cn/new/index) on April 28, 2025)III. Consolidation and expansion of achievements in poverty alleviation and ruralrevitalizationNone.

Section VI Important MattersI. Fulfillment of commitments

1. Commitments fulfilled by the actual controllers, shareholders, affiliated parties, acquirers, and the Company within the reporting period andcommitments not yet fulfilled by the end of the reporting period?Applicable □ Not applicable

independent financial accounting system. 2. Gree Electric Appliances will openbank accounts independently and will not share bank accounts with its affiliatedenterprises. 3. The financial personnel of Gree Electric Appliances will notwork part-time in its affiliated enterprises. 4. Gree Electric Appliances will paytaxes independently in accordance with the law. 5. Gree Electric Applianceswill make independent financial decisions, and the intended Transferee will notillegally interfere with Gree Electric Appliances's fund utilization andscheduling. (IV) Ensuring the independence of the organizational structure ofthe listed company: 1. Gree Electric Appliances will establish a sound corporategovernance structure and will have an independent and complete organizationalstructure. 2. The internal management bodies of Gree Electric Appliances willexercise their powers and functions independently in accordance with laws,regulations, and the Articles of Association of the Company. (V) Ensuring thebusiness independence of the listed company: 1. Gree Electric Appliances willhave the assets, personnel, qualifications, and abilities to carry out businessactivities independently and will have the ability to operate independently andcontinuously in the market. 2. The enterprise will not interfere with the businessactivities of Gree Electric Appliances except through the exercise ofshareholders' rights. 3. The enterprise and other enterprises under its controlwill avoid horizontal competition with Gree Electric Appliances. 4. When theenterprise and other enterprises under its control conduct necessary andunavoidable affiliated transactions with Gree Electric Appliances, the enterprisewill conduct fair operations according to the marketization principle and at fairprices, and perform transaction procedures and information disclosureobligations in accordance with relevant laws and regulations and regulatorydocuments. If any one of the above commitments is violated, the enterprise willbear all the liabilities arising therefrom and indemnify or hold harmless GreeElectric Appliances from all direct or indirect losses.

(LimitedPartnership);ZhuhaiYuxiuInvestmentCo., Ltd.

Electric Appliances.

Except through the exercise of shareholders' rights and the performance offunctions and duties of the Chairman/senior executive of the listed company, Iwill not interfere with the business activities of Gree Electric Appliances. 3. Iand other enterprises under my control will avoid substantial horizontalcompetition with Gree Electric Appliances. 4. When conducting necessary andunavoidable affiliated transactions with Gree Electric Appliances, I and otherenterprises under my control will conduct fair operations according to themarketization principle and at fair prices, and perform transaction proceduresand information disclosure obligations in accordance with relevant laws andregulations and regulatory documents. If any one of the above commitments isviolated, I will bear all the liabilities arising therefrom, and indemnify or holdharmless Gree Electric Appliances from all direct or indirect losses.

DongMingzhu

the sustainable and healthy economic development of Zhuhai. 4. ZhuhaiMingjun commits to actively exercise the shareholders' voting right in thegeneral meeting of shareholders of the listed company involving dividendpayment and to urge its nominated directors to vote in favor of the resolution ofthe Board of Directors on the dividend payment ratio of not less than 50% ofthe annual net profit of the listed company.

2. Explanation of assets or projects that achieve the original earnings forecast and relevant reasons whenthe Company's assets or projects involve earnings forecast and the reporting period is still in theearnings forecast period

□ Applicable ?Not Applicable

II. Listed company's non-operating funds occupied by the controlling shareholders andtheir affiliated parties

□ Applicable ?Not Applicable

No controlling shareholder or its affiliated party occupied non-operating funds of the listed company during the reporting periodof the Company.III. Violation of external guarantees

□ Applicable ?Not Applicable

The Company has no violation of external guarantees during the reporting period.

IV. Statement by the Board of Directors on the latest Non-standard Audit Report

□ Applicable ?Not Applicable

V. Statement by the Board of Directors, Board of Supervisors, and independent directors (ifany) on the Non-standard Audit Report of the accounting firm during the reporting period

□ Applicable ?Not Applicable

VI. Description of changes in accounting policies, accounting estimates, or corrections ofsignificant accounting errors compared to the previous year's financial statements? Applicable ? Not Applicable

(1) Changes in major accounting policies

1) Interpretation No. 17 of Accounting Standards for Business Enterprises

On November 9, 2023, the Ministry of Finance issued Interpretation No. 17 of Accounting Standards for Business Enterprises(hereinafter referred to as "Interpretation No. 17"). The change in accounting policy did not have a significant impact on thefinancial indicators including total assets, total liabilities, net assets, and net profits of the Company. Therefore, the aboveexplanations have no significant impact on the financial statements of the Company.

2) Interpretation No. 18 of Accounting Standards for Business Enterprises

On December 31, 2024, the Ministry of Finance issued Interpretation No. 18 of Accounting Standards for Business Enterprises(hereinafter referred to as "Interpretation No. 18"), which came into effect upon its issuance. The Company chooses to implementthis interpretation in advance from the year of its issuance (2024). The Company's provision for quality guarantees that do not fallunder individual performance obligations was originally recorded under "selling expenses". According to Article 2 "Accountingfor quality guarantees that do not fall under individual performance obligations" of Interpretation No. 18, it is now recorded under"main business cost" and "other business cost", presented in the "operating cost" of the income statement, and subject to

retrospective adjustments.

Currency: CNY

(2) Changes in major accounting estimates

None.VII. Description of changes in the consolidated statement scope compared to the previousyear's financial statements?Applicable □ Not applicable

1. Business combination not under common control

(1) Business combinations not under common control that occurred during the period

Currency: CNY

(Continued)

Currency: CNY

On June 30, 2024, the Company's wholly-owned subsidiary, DunAn Environment, acquired 62.95% of the equity of Shanghai DatroAutomotive Technology Co., Ltd. (hereinafter referred to as "Datro") through a cash transaction valued at CNY214.5977 million,and also increased its capital in Datro by CNY30 million. After the transaction was completed, DunAn Environment held 65.95%of the equity in Datro. DunAn Environment has completed the equity transfer and industrial and commercial change registrationprocedures. Datro has been included in the consolidated scope of DunAn Environment.

(2) Cost of business combination and goodwill

Currency: CNY

Total cost of business combination

DunAn Environment currently holds 65.95% of the equity in Datro. The enterprise merger cost is CNY244,597,668.00. The fairvalue share of identifiable net assets attributable to the parent company shareholders obtained is CNY62,667,044.92. Thecorresponding fair value of identifiable net assets was assessed by Zhonglian Appraisal Consulting (Shanghai) Co., Ltd. and anassessment report with the number ZLHP Zi [2024] No. 20 was issued. The difference between the enterprise merger cost and thefair value share of identifiable net assets attributable to the parent company shareholders of Datro forms goodwill ofCNY181,930,623.08.

(3) Identifiable assets and liabilities of the acquiree on the acquisition date

Currency: CNY

Long-term Borrowings

2. Business combination under the same control

None.

3. Reverse purchase

None.

4. Disposal of subsidiaries

Currency: CNY

Co., Ltd.

5. Change of combination scope for other reasons

Newly established entity in the current period:

Currency: CNY

VIII. Appointment and dismissal of accounting firms

Accounting firm currently appointed

accounting firm

Is the other accounting firm appointed for the current period?

□ Yes ?No

Appointment of an accounting firm for internal control audit, financial adviser, or sponsor?Applicable □ Not applicableDuring the year, the Company appointed Union Power Certified Public Accountants (Special General Partnership)as the accounting firm for the internal control audit of the Company.IX. Delisting after disclosure of the Annual Report

□ Applicable ?Not Applicable

X. Matters related to bankruptcy reorganization

□ Applicable ?Not Applicable

The Company was not involved in any matter related to bankruptcy reorganization during the reporting period.

XI. Major legal action or arbitration

□ Applicable ?Not Applicable

The Company was not involved in any major legal action or arbitration during the reporting period.XII. Punishment and rectification

□ Applicable ?Not Applicable

The Company was not involved in any punishment or rectification during the reporting period.XIII. Integrity status of the Company and its controlling shareholder(s) andactual controller(s)

□ Applicable ?Not Applicable

IV. Significant affiliated transactions

1. Affiliated transactions associated with day-to-day operations

?Applicable □ Not applicable

2. Affiliated transactions of acquisition or sales of assets or equities

□ Applicable ?Not Applicable

The Company was not involved in any affiliated transaction of acquisition or sales of assets or equities during thereporting period.

3. Affiliated transactions of joint foreign investment

□ Applicable ?Not Applicable

The Company was not involved in any affiliated transactions of joint foreign investment during the reportingperiod.

4. Affiliated credits and debts

□ Applicable ?Not Applicable

The Company was not involved in any affiliated credits or debts during the reporting period.

5. Transactions with affiliated finance companies

□ Applicable ?Not Applicable

There was no deposit, loan, credit, or other financial business between the Company and its affiliated financialcompanies and affiliated parties.

6. Transactions between the financial company under the Company's control and theaffiliated parties? Applicable ? Not ApplicableDeposit business

Gree TradeCo., Ltd.

7. Other significant affiliated transactions

□ Applicable ?Not Applicable

The Company was not involved in other significant affiliated transactions during the reporting period.XV. Significant contracts and their fulfillment

1. Information about trusteeship, contracting, and lease

(1) Trusteeship

□ Applicable ?Not Applicable

The Company was not involved in any trusteeship during the reporting period.

(2) Contracting

□ Applicable ?Not Applicable

The Company was not involved in any contracting during the reporting period.

(3) Lease

□ Applicable ?Not Applicable

The Company was not involved in any lease during the reporting period.

2. Significant guarantee

?Applicable □ Not applicable

Unit: CNY10,000

Gree(Hangzhou)ElectricAppliancesCo., Ltd.

Gree (Linyi)ElectricAppliancesCo., Ltd.

Zhuhai GreePrefabricatedVegetableEquipmentTechnologyDevelopmentCo., Ltd.

Object ofGuarantee

GreeAltairnanoNew EnergyInc.

GreeAltairnanoNew EnergyInc.

Zhuhai GreeAltairnanoElectricApplianceCo., Ltd.

The guaranteeperiod is from theeffective date ofthe mastercontract to twoyears after thedate of expirationof theperformanceperiod of the lastinstallment of thedebt under themaster contract.

GreeAltairnanoNew EnergyInc.

Explanation of composite guarantee

3. Entrusting cash asset management

(1) Entrusted financial management

?Applicable □ Not applicableOverview of entrusted financial management during the reporting period

Unit: CNY10,000

Situation of high-risk entrusted financial management with large individual amounts or low security and poor liquidity

□ Applicable ?Not Applicable

Expected inability to recover principal or other situations that may lead to impairment in entrusted financial management

□ Applicable ?Not Applicable

(2) Entrusted loan

□ Applicable ?Not Applicable

The Company was not involved in any entrusted loan during the reporting period.

4. Other significant contracts

□ Applicable ?Not Applicable

The Company did not enter into any other significant contracts during the reporting period.

XVI. Description of other significant matters

□ Applicable ?Not Applicable

There were no other significant matters to be disclosed during the reporting period.XVII. Significant matters of the Company's subsidiaries

□ Applicable ?Not Applicable

Section VII. Changes in Shares and ShareholdersI. Changes in shares

1. Changes in shares

Unit: share

domestic legalperson

shares

shares

Causes for changes in shares?Applicable □ Not applicableOn October 17, 2024, the total share capital of the Company and the number of circulating shares without trading restrictions changed from 5,631,405,741 shares to 5,601,405,741 shares as aresult of the cancellation of shares in the special securities account for repurchase. For details, please refer to the Announcement on the Completion of Share Repurchase Cancellation and theChange in Stockholder's Equity (Announcement No.: 2024-037) on CNINFO (http://www.cninfo.com.cn/new/index) and designed media.The increase in restricted shares this time is due to the increase in locked shares after the resignation of senior executives.Approval of changes in shares?Applicable □ Not applicableOn August 2, 2024, the Company held the 19th Meeting of the 12th Board of Directors and the 16th Meeting of the 12th Board of Supervisors to deliberate and approve the Proposal on Changingthe Purpose of Some Repurchased Shares and Canceling and Reducing the Company's Registered Capital, agreeing to change the purpose of 30,000,000 repurchased shares deposited in thespecial securities account for repurchase. The original plan was changed from "for implementing the company's equity incentive or employee stock ownership plan" to "for cancellation andreduction of registered capital", and 30,000,000 shares were canceled and the corresponding registered capital was reduced.The aforementioned proposal has been deliberated and approved at the 1st Extraordinary General Meeting of Shareholders in 2024 of the Company held on August 19, 2024. The Company hascanceled 30,000,000 shares in total, and after this share cancellation, the total share capital of the Company was changed from 5,631,405,741 shares to 5,601,405,741 shares. For details, pleaserefer to the Announcement of Gree Electric Appliances, Inc. of Zhuhai on Changing the Purpose of Some Repurchased Shares and Cancelling and Reducing the Company's Registered Capital(Announcement No.: 2024-025) disclosed on CNINFO (http://www.cninfo.com.cn/new/index) and designated media.Transfer of share changes

□ Applicable ?Not Applicable

Impact of share changes on financial indicators such as basic earnings per share, diluted earnings per share, and net assets per share attributable to common shareholders of the Company for thelatest year and the latest period?√ Applicable ?Not ApplicableOther information deemed necessary by the Company or required to be disclosed by the securities regulatory authority

□ Applicable ?Not Applicable

2. Changes in restricted shares

?Applicable □ Not applicable

Unit: share

II. Securities issuance and listing

1. Securities issuance (excluding preferred shares) during the reporting period

□ Applicable ?Not Applicable

2. Description of changes in the Company's total number of shares and shareholderstructure, and asset and liability structure?Applicable ? Not applicable

3. Existing internal employee share

□ Applicable ?Not Applicable

III. Shareholders and actual controllers

1. Number of shareholders and their shareholding status

Unit: share

legalperson

Description of the above-mentionedshareholders’ involvement inentrusting/being entrusted with andwaiving voting rights

Industrial and Commercial Bank of China— China AMC CSI 300 ETF

Description of shareholders holding more than 5% of the shares, the top 10 shareholders, and the top 10 shareholders of circulating shares without trading restrictions in lending shares throughrefinancing?Applicable □ Not applicable

Unit: share

Capital

Change compared with the previous period due to the lending/repayment through refinancing of the top 10 shareholders and the top 10 shareholders of circulating shares without tradingrestrictions

□ Applicable ?Not Applicable

Do the top 10 common shareholders and top 10 common shareholders without trading restrictions of the Company conduct agreed repurchase transactions during the reporting period?

□ Yes ?No

The top 10 common shareholders and top 10 common shareholders without trading restrictions of the Company didn't conduct agreed repurchase transactions during the reporting period.

2. Company's controlling shareholder

Nature of controlling shareholder: No controlling entityType of controlling shareholder: No controlling shareholderDescription of no controlling shareholder for the CompanyOn December 2, 2019, Gree Group signed the Share Transfer Agreement Between Zhuhai Gree Group Co., Ltd. andZhuhai Mingjun Investment Partnership (Limited Partnership) on 15% of the Shares of Gree Electric Appliances,Inc. of Zhuhai, with Zhuhai Mingjun to transfer 902,359,632 shares of the listed company to Zhuhai Mingjun. Afterthe transaction was completed, Zhuhai Mingjun, the single largest shareholder, and Dong Mingzhu, the person actingin concert could not pass specific resolutions based on their actual voting rights of the listed company's shares, sothey had no significant impact on the resolutions of the general meeting of shareholders of the listed company or asole discretion for the election of more than half of the members of the Board of Directors of the listed company.Therefore, the listed company had no controlling shareholders and actual controllers. For details, please refer to theReply to the Inquiry Letter from Shenzhen Stock Exchange disclosed by the Company on CNINFO(http://www.cninfo.com.cn/new/index) on January 18, 2020.Change in controlling shareholder during the reporting period

□ Applicable ?Not Applicable

There was no change in the controlling shareholder of the Company during the reporting period.

3. Actual controller of the Company and its person acting in concert

Nature of the actual controller: No actual controllerType of the actual controller: No actual controllerDescription of no actual controller for the CompanyOn December 2, 2019, Gree Group signed the Share Transfer Agreement Between Zhuhai Gree Group Co., Ltd. andZhuhai Mingjun Investment Partnership (Limited Partnership) on 15% of the Shares of Gree Electric Appliances,Inc. of Zhuhai, with Zhuhai Mingjun to transfer 902,359,632 shares of the listed company to Zhuhai Mingjun. Afterthe transaction was completed, Zhuhai Mingjun, the single largest shareholder, and Dong Mingzhu, the person actingin concert could not pass specific resolutions based on their actual voting rights of the listed company's shares, sothey had no significant impact on the resolutions of the general meeting of shareholders of the listed company or asole discretion for the election of more than half of the members of the Board of Directors of the listed company.Therefore, the listed company had no controlling shareholders and actual controllers. For details, please refer to theReply to the Inquiry Letter from Shenzhen Stock Exchange disclosed by the Company on CNINFO(http://www.cninfo.com.cn/new/index) on January 18, 2020.Are there shareholders with a shareholding ratio of more than 10% at the ultimate control level of the Company??Yes □No?Legal person □ Natural personShareholding at the ultimate control level

Partnership(LimitedPartnership)

Change in the actual controller during the reporting period

□ Applicable ?Not Applicable

There was no change in the actual controller of the Company during the reporting period.Block diagram of the property rights and control relationship between the Company and the actual controller

The company has no actual controller

Control of the Company through a trust or other asset management methods by the actual controller

□ Applicable ?Not Applicable

4. Cumulative number of shares pledged by the controlling shareholder or the largestshareholder of the Company and its persons acting in concert reaching 80% of the numberof shares held by them in the Company?Applicable □ Not applicable

MingjunInvestmentPartnership(LimitedPartnership)

5. Other corporate shareholders holding more than 10% of shares

□ Applicable ?Not Applicable

6. Restrictions on shareholding reduction by controlling shareholders, actual controllers,restructuring parties, and other commitment entities

□ Applicable ?Not Applicable

IV. Implementation of share repurchase during the reporting periodImplementation progress of share repurchase

□ Applicable ?Not Applicable

Implementation progress of reducing holdings of repurchased shares through centralized bidding

□ Applicable ?Not Applicable

Section VIII Preferred Share Information

□ Applicable ?Not Applicable

The Company did not have any preferred shares during the reporting period.

Section IX Bond Information

□ Applicable ?Not Applicable

Section X Financial StatementsI. Audit report

Audit report text

Audit Report

ZHSZ (2025) No. 0500119All shareholders of Gree Electric Appliances, Inc. of Zhuhai:

I. Audit opinionWe have audited the financial statements of Gree Electric Appliances, Inc. of Zhuhai (hereinafterreferred to as "your company"), including the Consolidated and Company's Balance Sheets as ofDecember 31, 2024, and 2024 Consolidated and Company's Income Statements, 2024 Consolidatedand Company's Cash Flow Statements, 2024 Consolidated and Company's Statements of Changesin Shareholders' Equity, and Notes to Financial Statements.In our opinion, the attached financial statements have been prepared in all material aspects inaccordance with the Accounting Standards for Business Enterprises and fairly reflected theconsolidated and Company's financial position of your company as of December 31, 2024, and theconsolidated and Company's operating results and cash flows in 2024.II. Basis for forming audit opinionsWe have conducted our audit work according to the provisions of the Audit Standards for CertifiedPublic Accountants of China. The part of "CPA's responsibility for the audit of financial statements"in the audit report describes our responsibilities under these standards. In accordance with the Codeof Ethics for Certified Public Accountants of China, we are independent of your company andperform other responsibilities in terms of professional ethics. We believe that the audit evidenceobtained by us is sufficient and appropriate, providing a basis for expressing our audit opinion.III. Key audit mattersKey audit matters are those matters that, in our professional judgment, were of most significance inthe audit of the financial statements of the current period. The response to these matters is based onthe overall audit of the financial statements and the formation of audit opinions. We do not give

separate opinions on these matters.(I) Accrual of inventory falling price reserves

(II) Revenue recognition

Key audit matters

IV. Other informationThe management of your company is responsible for other information. The other informationcomprises the information included in the 2024 Annual Report, other than the financial statements

and our auditor’s report thereon.Our audit opinions on financial statements do not cover any other information, and we do notexpress any form of assurance thereon.In connection with our audit of the financial statements, our responsibility is to read otherinformation identified above, and, in doing so, consider whether the other information is materiallyinconsistent with the financial statements or our knowledge obtained in the audit, or otherwiseappears to be materially misstated.If, based on the work we have performed, we conclude that there is a material misstatement of theother information, we are required to report that fact. We have nothing to report in this regard.V. Responsibilities of management and governance for financial statementsThe management of your company (hereinafter referred to as the "management") is responsible forpreparing the financial statements in accordance with the requirements of Accounting Standards forBusiness Enterprises to achieve a fair presentation, and for designing, implementing, andmaintaining internal control that is necessary to ensure that the financial statements are free frommaterial misstatements, whether due to frauds or errors.When preparing financial statements, the management is responsible for evaluating your company'sability to continue as a going concern, disclosing matters related to going concern (if applicable),and applying the assumption of going concern, unless the management plans to liquidate yourcompany, cease operations, or has no other realistic choice.The governance is responsible for overseeing your company's financial reporting process.VI. CPA's responsibilities for the audit of the financial statementsOur objective is to obtain reasonable assurance about whether the financial statements as a wholeare free from material misstatements caused by fraud or error and to issue an audit report containingan audit opinion. Reasonable assurance is a high-level assurance but is not a guarantee that an auditconducted in accordance with the audit standards will always detect a material misstatement whenit exits. Misstatements may arise from fraud or error and are considered material if, individually orin the aggregate, they could reasonably be expected to influence the economic decisions of userstaken on the basis of these financial statements.As part of an audit in accordance with the audit standards, we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

(I) Identify and assess the risks of material misstatement of the financial statements, whether due tofraud or error, design and perform audit procedures responsive to those risks, and obtain auditevidence that is sufficient and appropriate to provide a basis for our opinion. The risk of notdetecting a material misstatement resulting from fraud is higher than the one resulting from error,as fraud may involve collusion, forgery, omissions, misrepresentations, or the override of internalcontrol.(II) Obtain an understanding of internal control related to the audit in order to design appropriateaudit procedures.

(III) Evaluate the appropriateness of accounting policies used and the reasonableness of accountingestimates and related disclosure made by the management of your company.(IV) Conclude on the appropriateness of using the going concern assumption by the managementof your company, and conclude, based on the audit evidence obtained, whether a materialuncertainty exists related to events or conditions that might cast significant doubt on your company'sability to continue as a going concern. If we conclude that there was a significant uncertainty, weare required by audit standards to draw the attention of report users to the relevant disclosures in thefinancial statements in the audit report; if such disclosures are inadequate, we should express a non-unqualified opinion. Our conclusions are based on the information available as of the audit reportdate. However, future events or conditions may cause your company to cease to continue as a goingconcern.(V) Evaluate the overall presentation, structure, and content of the financial statements, and evaluatewhether the financial statements fairly reflect relevant transactions and events.(VI) Obtain sufficient and appropriate audit evidence regarding the financial information of yourcompany's entity or business activities to express an opinion on the financial statements. We areresponsible for guiding, supervising, and implementing group audits. We remain solely responsiblefor the audit opinions.We communicate with the governance regarding, among other matters, the planned audit scope,schedule, and major audit findings, including any significant deficiencies in internal control that weidentify during the audit.We also provide a statement to the governance regarding the observed professional moralrequirements related to independence and communicate with the governance about all therelationships and other matters that might be reasonably considered to affect our independence, aswell as the related countermeasures (if applicable).From the matters discussed with the governance, we determine the matters that are of mostsignificance in the audit of the financial statements of the current period, thus constituting key auditmatters. We describe these matters in the audit report unless laws and regulations prohibit publicdisclosure of these matters, or in rare cases, we determine that a matter should not be communicatedin the audit report because the adverse consequences of doing so would reasonably be expected tooutweigh the public interest benefits of such communication.

Consolidated Balance Sheet

Consolidated Balance Sheet (Continued)