Rongsheng Chairman's 2024 New Year Address

Chairman and General Manager of Rongsheng Corporation, Su Shangwen

(January 1, 2024)

As we bid farewell to the past and welcome the new, the days of diligent struggle seem fleeting, and here we are in the year 2024. On this occasion of ushering in the new year, I extend sincere thanks and heartfelt wishes on behalf of the Rongsheng's Party Committee and the entire staff, including their families and retired comrades, to all the friends from various sectors of society who have been supporting and caring for the company's development.

Looking back at the year 2023, we focused on improving quality and efficiency, rigorously implemented cost reduction and efficiency improvement measures, strengthened internal R&D, expanded our market presence, and steadily advanced in high-quality development. Our output exceeded CNY 1 billion, and our operational achievements reached historical highs. Achieving such results against the backdrop of the uncertain global economic recovery highlights the extraordinary charm and strength of Rongsheng.

During this year, we adhered to a steadfast market expansion strategy, synergizing efforts in both domestic and international markets, resulting in a twofold increase in product exports. The newly established project team for promoting new products secured nearly CNY 50 million in orders within six months, yielding remarkable outcomes. We pursued customer satisfaction by extending our services, opening the Southwest branch, and establishing accessory warehouses in Dubai, Kuwait, and Oman. Our 31 global service centers provided professional, efficient services to users worldwide.

Innovation leads development, and technology shapes the future. Our high-end spray preventers successfully safeguarded Asia's deepest vertical well and China's deepest onshore natural gas horizontal well, demonstrating resilience under extremely challenging geological conditions. Pioneering technological achievements such as the digital well control system, high-temperature rubber components, and precise pressure control drilling choke manifold and control systems were introduced to the market. The application of the first domestically produced underwater spray preventer in deep-sea scenarios, along with the orderly progress of the 175MPa ultra-high pressure spray preventer and 48-140 super-high-temperature high-pressure spray preventer projects, has signaled the beginning of the engineering development of the first set of domestically produced deepwater spray preventers and control systems, heralding a new journey for Rongsheng.

This year posed heavy tasks for contract output and numerous research and development projects, but through collective efforts, meticulous planning, and precise output, we achieved dual victories in contract retention and R&D. With a focus on digitalization and intelligent production, we invested over CNY 47 million, streamlined processes to enhance efficiency, addressed production weaknesses, and significantly increased our production capacity to meet growing demand.

We lived a fulfilling and determined year, with tangible results from our cost reduction and efficiency improvement measures. Our asset structure was optimized, management systems continued to improve, and more precise salary incentives were implemented. Modernization of governance systems and capabilities progressed effectively. Safety and environmental protection sailed smoothly alongside exciting cultural developments, and the benefits of our growth were maximally extended to our employees, noticeably elevating the quality of Rongsheng's development.

As we continue the journey of diligence, we stride confidently into a new era.

In 2024, a pivotal year for the company's "Water and Land Advancement" strategy and the in-depth implementation of the "Dual-Center" market expansion strategy, we must maintain strategic focus, anchor our goals, and vigorously promote the Rongsheng spirit of "Self-Strengthening, Innovation, Surpassing, and Dedication." We must shoulder our responsibilities, work hard, and strive for low-cost operation and high-quality development, ceaselessly pushing ourselves towards becoming a renowned company in the global petroleum machinery manufacturing industry.

I wish all employees and friends from various sectors of society good health, smooth work, and happiness in their families!