Dear Shareholders,

2025 marks a defining year for Huaxin Building Materials to reshape landscape and redefine value. Amid a cyclical downturn in the domestic building materials market, the Company not only weathered the storm but also successfully expanded the global footprint of strategic assets. Navigating in the intensifying industry "involution" and evolving demand dynamics, the management demonstrated unwavering strategic resolve, steering the team through a pivotal transition from "scale growth" to "quality growth". 2025’s performance results have commanded the full attention of the capital markets: the market capitalization surged 108% against strong market headwinds, leading the industry, while financial fundamentals improved measurably, with the operating cash flow continuing its upward trajectory. In this context, the global value of Huaxin, a company with more than a century of history, is being redefined.

Over the past year, Huaxin's strategy focus has centred on optimizing the asset portfolio and constructing a global moat capable of navigating economic cycles.

A historic breakthrough in our overseas footprint: We successfully completed the acquisition and integration of the Lafarge’s Nigeria operations and brought the aggregates project in Brazil into operation. These strategic initiatives have positioned Huaxin as the Chinese cement producer with the largest overseas production capacity and the broadest geographical footprint. Expansion into high-margin overseas markets is fast emerging as the second growth engine.

Unlocking synergies across domestic operations: In the domestic arena, through integrated and synergistic operations, the undisputed leadership in the aggregates business was further cemented (ranking first nationally in both production and sales), while achieving positive net operating cash flow in the concrete business for the first time. This marks the evolution of the domestic operations from mere scale expansion into mature business units with robust, self-sustaining profitability.

2026, initiating the commencement of the 15th Five-Year Plan, also marks a pivotal year for Huaxin's global strategy to transition from "expand footprint" to "deepen presence". Not only will the Company continue to steadily expand its global footprint, but it will also sharpen the focus on enhancing capital efficiency and fortifying the core competitiveness, as the Company strives to emerge as a world-class building materials enterprise with global pricing power.

1.Advancing Supply-Side Reform and Enhancing Asset Returns

The Company will align closely with the government's capacity policies and resolutely adhere to the mandate of "organizing production in accordance with approved capacity". Amid the ongoing industry-wide capacity consolidation, Huaxin will proactively assume the responsibilities of a market leader, safeguarding orderly competition. A recovery in overall industry profitability is essential to delivering sustainable long-term value for shareholders.

2. Accelerating Overseas Capacity Release and Forging a Global Growth Engine

The overseas operation is set for earnings realization.

Operational targets: Ensure the newly built and upgraded projects in Nigeria and Mozambique, along with the expansion projects in Tanzania and Zimbabwe, commence production as scheduled; and strive to achieve overseas cement sales volume exceeding 27 million tons for the full year, with an EBITDA contribution surpassing RMB7 billion.

Strategic intent: By rebalancing the global capacity presence , we aim to mitigate exposure to individual market cycles and position the overseas operations as a key pillar supporting the Company's long-term growth.

3. Driving Extreme Cost Optimization and Digital & Intelligent Transformation to Build a Cost Moat

In the building materials industry, cost leadership underpins pricing power. In 2026, we will drive cost reductions across the entire value chain through micro-innovations in technical parameters and the application of digital and information technologies. Even incremental efficiency gains, when scaled across the world-class production base, will translate into substantial economic value. We will continue to ramp up investment, accelerate the implementation of AI applications across our core businesses, and cement an absolute competitive advantage in the digital arena.

4. We will continuously enhance the alternative fuel substitution rate across all operations, steadily advance the implementation of carbon reduction innovation technology projects, and strive to achieve the goals set forth in the Company's Low-Carbon Development White Paper.

5. Consolidating the Foundation for Sustainable Profitability and Delivering Win-win for All Stakeholders

Guided by the philosophy that “a better world begins with us,” the Company will continue to expand its profitability moat through dynamic alignment of stakeholder interests. In an increasingly complex global operating environment, sustained value creation for all stakeholders remains essential to ensuring the long-term stability of global operations and strengthening the Company’s resilience in the face of future challenges.

A new chapter has begun, and we are forging ahead with renewed purpose. In 2026, Huaxin will embrace the transformations and opportunities in the global marketplace with a more proactive and open outlook. We extend our gratitude to our shareholders for their enduring trust and look forward to working together to create sustainable long-term value.

CEO Li Yeqing