R&D investments and service upgrades in 2022

In 2022, our company, a manufacturer of steel grinding balls, has invested heavily in research and development (R&D) and technology upgrades. This year, we invested a total of RMB 9.4 million (worth approximately US$1.2 million) in R&D, a significant increase of 40% compared to the previous year. Investments focused on developing new product lines and upgrading our services, as well as improving our existing processes and technologies. In particular, we invested in the areas of automation and robotics as well as computer-aided design (CAD) and computer-aided manufacturing (CAM). We have also purchased a new production line to produce different sizes of grinding balls, which will allow us to produce faster and save more energy. In addition, we continue to develop our talent program to attract more high-quality graduates to work for local companies by offering free accommodation and a settling-in allowance. These investments and upgrades have enabled us to increase efficiency, reduce costs, expand our talent pool and improve product quality. Our production capacity has also increased dramatically, almost doubling, production times have been compressed and higher quality products are being delivered to our customers. We are confident that these investments and upgrades will help us maintain our competitive advantage and stay ahead of the curve in the evolving steel ball industry.