Jiangsu Zhongheng Pet Articles Joint-Stock Co.,Ltd.

Company: Zhongheng Full-chain pet products manufacturer and brand operator: • Independent design, R&D, manufacturing, and global distribution • Own factories + global supply chain network • Own brand operations with parallel ODM/OEM services Jiangsu Zhongheng Pet Products Financial Data 2023 Financial Metrics | Data | YoY Growth --- | --- | --- Total Revenue | RMB 1.58 billion ~$220 million USD | +7.2% Net Profit | RMB 95 million ~$13 million USD | Stable profitability Gross Margin | 23.5% | Manufacturing positioning maintained Cash Flow | Healthy operating cash flow | Financially stable Business Composition: • Pet furniture: 85% of total revenue • Pet food: 10% of total revenue • Pet services: 5% of total revenue Pet Furniture Business Details: • Revenue: ~RMB 1.34 billion 85% of total • Product range: Full-spectrum pet furniture • Growth trend: 8%+ annual growth, stable Manufacturing Base and Capacity: Base | Type | Main Products | Annual Capacity --- | --- | --- | --- Yancheng Main Base | Primary manufacturing base | Full-range pet furniture | 15 million units Cooperation Bases | Contract manufacturing | Ancillary products | 4 million units Other Regions | Regional bases | Regional market products | 1 million units Capacity Strengths: • Large-scale manufacturing with outstanding capacity • Flexible multi-variety small-batch production capability • Comprehensive quality assurance system • Continuously optimized production efficiency Supply Chain and Vertical Integration: Link | Mode | Integration | Efficiency --- | --- | --- | --- Raw Material Procurement | Centralized procurement | Partially self-produced materials | Cost advantage Manufacturing | Self-operated | Core products self-manufactured | Quality controlled Logistics & Distribution | Nationwide network | Complete national distribution coverage | Timely delivery Inventory Management | Centralized | Inventory optimization system deployed | Efficient turnover Supply Chain Advantages: • Scale procurement driving cost benefits • Core product self-manufacturing capability • Nationwide logistics network coverage • Efficient inventory management system Quality Assurance and Certifications: Quality System: • ISO 9001 certification • Strict supplier qualification and material inspection • Real-time production monitoring • 100% finished product quality inspection Standards Compliance: • Chinese GB national standards • International quality and safety standards • Customer-specific quality requirements • Environmental certifications obtained R&D and Innovation Capability: R&D System: • Jiangsu R&D Center • Product testing laboratory facilities • 150+ R&D personnel • 3% of annual revenue invested in R&D Innovation Achievements: • 200+ product technology patents • 300+ new products developed annually • Continuous production process innovation • New materials R&D and application Market Position and Channel Network: Chinese Market Position: Segment | Market Share | Position | Key Strengths --- | --- | --- | --- Pet products overall | 15% | Absolute leader | Large-scale manufacturing advantage Pet furniture | 20% | Absolute leader | Full category coverage Channel supply | 18% | Significant leader | Broad channel coverage Export business | 12% | Important participant | Significant international business Channel Network: • Offline: Extensive nationwide retail coverage • Online: E-commerce platform sales channels • International: ODM/OEM cooperation with global customers • Direct sales: Enterprise customer channel ODM/OEM Business Capabilities: OEM Service Features: • Clients: Domestic and international pet brands • Services: Full-process from design to manufacturing • Quality: Meets brand customer standards • Delivery: Outstanding on-time delivery capability OEM Advantages: • Extensive large-scale manufacturing experience • Comprehensive quality system certification • Strong cost control capability • Multi-variety production capability Cost Control and Efficiency Optimization: Cost Advantages: • Economies of scale • Continuous supply chain cost optimization • Ongoing production efficiency improvement • Value engineering and design optimization Efficiency Optimization: • Continuous production process optimization • Automation equipment adoption and promotion • Lean production methodology implementation • Data-driven efficiency improvement Environmental and Social Responsibility: Environmental Practices: • Eco-friendly materials promotion • Clean production process application • Energy conservation in manufacturing • Waste recycling and utilization Social Responsibility: • Employment for 2,000+ employees • Local community engagement and support • Full regulatory compliance • Industry contribution to pet products sector Future Development Strategy: Strategic Priorities: • Manufacturing upgrade: Smart manufacturing advancement • Brand building: Own brand value enhancement • International expansion: Deep development of international

Pet Beds & Bedding — [Core Advantage Category] Full range of beds: Various pet beds and cushions core products - Pet shelters: Indoor and outdoor pet shelter products - Functional cushions: Complete line of functional pet mattresses Cat Activity Furniture — [Important Category] Cat climbing frame series: Various sizes of cat climbing frames - Cat activity furniture: Full range of cat activity furniture - Scratching toys: Cat scratching posts and toys Feeders & Tableware — [System Category] Pet tableware: Full range of pet bowls and water dispensers - Smart feeders: Smart feeder products - Feeding stations: Pet feeding solutions Cleaning & Care — [Advantage Category] Litter box series: Various litter box products - Cleaning supplies: Full range of pet cleaning products - Care products: Pet care-related products Pet Travel Gear — [Supplementary Category] Travel gear: Pet travel-related products - Transport supplies: Pet transport supplies series Pet Beds & Bedding Annual revenue: approx. CNY 630 million Absolute leader in China's pet bed market Pet bed series: 25% market share in China Pet shelters: Absolute leader in the pet shelter market Price positioning: CNY 50–500, mass market Cat Activity Furniture Annual revenue: approx. CNY 470 million Significant leader in the cat furniture market Cat climbing frame series: 22% market share in China Cat activity furniture: Major brand in the cat furniture market Price positioning: CNY 80–800, mass market Feeders & Tableware Annual revenue: approx. CNY 240 million Significant player in the pet tableware market Pet tableware: 18% market share in China Smart feeders: Player in the smart feeder market Price positioning: CNY 30–300, mass market Cleaning & Care Annual revenue: approx. CNY 160 million Significant leader in the pet cleaning market Litter box series: 20% market share in China Cleaning supplies: Major brand in the pet cleaning market Price positioning: CNY 40–400, mass market Pet Travel Gear Annual revenue: approx. CNY 80 million Player in the pet travel market Travel gear: 15% market share in China Transport supplies: Player in the pet transport market Price positioning: CNY 60–600, mass market