At the 2018 Annual Meeting and 2019 Spring Festival Gala of Huali Group, Wang Kun, Vice Chairman of Huali Holdings and Chairman of Construction Group, delivered a work report titled "2018 Work Summary and 2019 Target Tasks". The report summarizes and reviews the work in 2018, comprehensively deploys the work goals and tasks for 2019, not only showing off the report card, but also presenting the task list.

Chairman Wang Kun pointed out that in 2018, Huali Group seized the challenges and opportunities of the comprehensive transformation and upgrading of the construction industry, independently innovated and transformed, and took firm steps in transforming its business model and promoting high-quality, sustainable and healthy development. All four major sectors achieved new results and performance.

Construction sector. We have undertaken a number of key projects, livelihood projects, and new technology application projects, continuing to maintain the good momentum of creating excellence and winning the cup. It has been successively rated as "National Excellent Construction Enterprise", "Top 100 Enterprises in Anhui", "7th in Anhui Top 100 Private Enterprises", and "Top 20 Construction Enterprises in Hefei". Continue to maintain the national AAA credit enterprise and other honorary titles.

Real estate sector. The Liu'an Golden South County and Linquan Zhuangyuan Mansion projects have entered the final stage, while new development projects such as Huaiyuan Yide City are being fully promoted. Reserve projects strive for high starting points, high quality, high standards, and high efficiency. All developed projects have achieved their annual sales revenue targets.

Overseas sector. The newly signed contract amount is 300 million US dollars. We have dispatched 12 teams to over 10 countries for market research, business negotiations, and project promotion, and have opened up new markets in Ivory Coast, Mauritania, and Tunisia. The first batch of agricultural vehicle products from Yongjin Industry and Trade (Angola) Co., Ltd. were successfully produced and sold well.

Design section. The newly signed contract amount is nearly 30 million yuan, undertaking a number of representative engineering design tasks such as the Huali Technology and R&D Center Building, Hefei Rongshida Group Innovation Building, and Chizhou Municipal Party School EPC general contracting, providing strong technical support for the transformation and upgrading of enterprises.

Behind every transcript is the arduous effort, which cannot be separated from the care and support of governments and regulatory departments at all levels, embodying the spirit of all Huali people constantly pursuing their dreams.

The goal and task for 2019 is to firmly and unwaveringly transform and upgrade. We need to transform our business mechanism, form a management centered approach with projects as the carrier, promote standardized, refined, and information-based management, and establish a new pattern of synchronous development of brand building, corporate culture, and market awareness. We must adhere to overall planning, further streamline management relationships and workflow on the basis of the existing organizational structure, and ensure efficient operation; To establish a unified and standardized control mechanism, optimize the organizational structure of the project department, improve the target responsibility system and cost control system, and fully leverage the guiding role of incentive mechanisms; While strengthening team building, cultivate common values and further enhance the centripetal force, cohesion, and execution ability of all employees.

We need to accelerate business transformation and expand market share. Integrate resources from various business sectors to form an organizational system that integrates project management in design, procurement, and construction stages, closely integrating technology and management. Deeply cultivating the field of engineering general contracting, while consolidating new forms of construction such as EPC, prefabricated buildings, and rail transit, we will focus on expanding our project undertaking capabilities in areas such as rail transit, water conservancy and hydropower, and highways. Continue to expand into both domestic and international markets and cultivate large regional companies in China. Seize the development opportunity of the "the Belt and Road", strengthen the information tracking and business environment research of projects in countries along the line, and expand the scale of overseas projects.

Secondly, we need to strengthen our management foundation and enhance our core competitiveness. Explore and improve the two-level management system and hierarchical management methods of the group and project departments, and strengthen the company's standardized management methods. Lower the management focus to the construction site, use differentiated management methods, strengthen management, focus on monitoring, and ensure the achievement of project goal management. Actively promote the deep application of the company's information management platform and BIM technology in projects, establish a database center, and improve the level of data statistics, analysis, and control. Focusing on project site management, promoting standardized, refined, and information-based management to be implemented on construction sites. Fully launch the construction of a "Beautiful Project Department" with good quality, safety, beautiful environment, and beautiful life.

We must innovate development models and cultivate new growth points. Fully leverage Huali's qualifications and brand advantages to expand into professional markets such as water conservancy, intelligence, and electromechanical installation. On the basis of consolidating old strategic partners such as large state-owned enterprises and branded real estate, we will open up new strategic alliances and work together for win-win cooperation. Further expand the business volume of investment and development companies, and cultivate new economic growth points.

Fourthly, we need to strengthen risk management and ensure honest performance. Actively absorbing the essence of national laws, policies, and industry management regulations, controlling various risks of projects from the source, implementing a legal intervention system throughout the entire process of contract performance, and eliminating illegal activities of enterprises and individuals. Strictly implement the selection and evaluation system for project acceptance, and eliminate the acceptance of projects with low prices, high owner payment risks, and small scales. Adhere to the principle of "safety first, quality first", strengthen process control, ensure the normal operation of the project management system, implement the project goal management responsibility, improve the overall contract performance ability, and effectively maintain the reputation of Huali brand.

We must implement the strategy of producing high-quality products and enhance the quality of Huali. In 2019, Huali will strengthen project process planning, strictly implement the quality and safety responsibility system, take brand building such as creating national excellence, provincial excellence, and safe and civilized construction sites as the starting point, implement a boutique strategy, and further promote the deepening of model guidance and project standardization management. Enhance the Huali brand and establish Huali quality through high-quality projects.