Performance and Strategy | Green Transformation adds momentum and leads new industry development

On July 18, 2022, Wangneng Environment (002034) issued a notice on the acquisition of equity of Nantong Huili Rubber Co., Ltd. by Wangneng Environment Co., Ltd., announcing the proposal for the acquisition of equity of Nantong Huili Rubber Co., Ltd. approved by the company's board of directors. The announcement shows that Huzhou Wangneng Investment Co., Ltd., a wholly-owned subsidiary of Wangneng Environment, has acquired 77% equity of Nantong Huili Rubber Co., Ltd. for 331 million yuan. After the acquisition is completed, Wangneng Investment holds 77% equity of the target company and is included in the scope of the company's consolidated financial statements. After successful acquisition, Wangneng Environment will become the largest domestic recycled rubber production enterprise. Through this acquisition, the company will further expand its product line for renewable resource recycling. Mizuda Group's automotive dismantling division has stronger coordination, which can effectively enhance the company's comprehensive strength and increase its sources of profit.。

As of 2022, Nantong Huili has gone through a 47 year development process. For 47 years, Nantong Huili has been focusing on the production and manufacturing of recycled rubber, and has been dedicated to one thing for decades without wavering in its main business. For over 40 years, Nantong Huili Rubber Co., Ltd. has been running a factory from a school. With the rapid development of China's rubber industry in the tide of economic reform and opening up, under the leadership of former chairman Ni Xuewen and the efforts of all "Nanhui people", it has gone through a bumpy development process from small to large, from weak to strong, and has achieved a difficult entrepreneurial journey from unknown to famous, creating many extraordinary achievements。

The enterprise has always been a gold medal enterprise in Haimen City, ranking among the top in terms of tax revenue for many consecutive years. It has made positive contributions to benefiting the local people and economic construction, and has accumulated over 3 million tons of waste tires over the years, making outstanding contributions to environmental improvement and rubber recycling. The enterprise has participated in major industrial technology development projects such as the National Development and Reform Commission multiple times, and has led the formulation of national standards and industry group standards such as "Recycled Rubber", "Vulcanized Rubber Powder", and "Green Factory Evaluation Requirements for Recycled Rubber"。

At present, the comprehensive utilization industry of waste rubber in China is facing a major challenge in the transformation and upgrading of the entire industry. The entire industry needs to embark on an innovative path of green development and high-value recycling, improve automation level, clean production, and change the industry's appearance. After years of development, Nantong Huili has formed a product advantage with stable quality, complete varieties, and the ability to meet the needs of different users. Customers are widely distributed in the rubber product industry, including the tire industry。

On September 23rd, Qi Xuezhi, Secretary General of the Waste Rubber Comprehensive Utilization Branch of the China Rubber Industry Association, made a special trip to Nantong Huili to meet with the new General Manager of Nantong Huili, Yang Wenyu. General Manager Yang Wenyu is appointed by the board of directors of the listed company, Wangneng Environment. He is young, knowledgeable, and experienced, and will lead Nantong to strive for new glory。

General Manager Yang Wenyu stated that for the current industry transformation and upgrading, especially product transformation and upgrading, Nantong Huili will mainly achieve the following three points: first, the product should be green, and the company will further adjust its product structure, improve product quality, and lead the development of the industry. Vigorously producing environmentally friendly recycled rubber to meet the requirements of relevant EU environmental regulations. In addition, the product is finely differentiated to meet the requirements of different customers and products, such as fine particle recycled adhesive, high-strength environmentally friendly recycled adhesive, etc. Secondly, the production process should be green. The company has always been committed to process innovation and the development of green and environmentally friendly processes. Currently, the company's synthetic recycled rubber has all been produced using green atmospheric pressure regeneration technology, and the products have received high praise from customers, achieving continuous and clean production. The third is the continuous upgrading and improvement of environmental protection treatment technology, effectively addressing the issue of rubber odor. For environmental protection, Nantong Huili has always attached great importance. The company is located in Nantong City on the north side of Shanghai, and environmental protection requirements are very strict. The company regards environmental protection as the top priority in enterprise development, continuously increasing investment, improving production processes, and adding environmental protection equipment, achieving very good results and receiving high praise from the superior supervisory department。

Focusing on the southern return and leading the industry's new development. Under the leadership of the new leadership team, we have reason to believe that the new Nanhui will bring a new development outlook to the industry and make new and greater contributions to China's waste rubber comprehensive utilization industry！