New Year’s Address from the Chairman of Yongxing Technology – 2022

"Time waits for no one; the prime of life never returns." In the blink of an eye, 2021 has come to an end. Looking back at the year, we experienced thrills, sorrows, joys, and challenges—emotions that are hard to describe. As I reread the 2021 New Year’s message, I was filled with endless reflection and a wry smile. Many of the challenges in our business operations seem to have repeated themselves: ensuring safe production, epidemic prevention and control, stricter environmental regulations, unpredictable spikes in raw material prices, constant communication with clients, rising shipping costs, and container shortages that disrupted exports.

What happened globally and nationally in 2021—especially the changes in government policies—reminded us in manufacturing to be vigilant, to reassess our strategies, and to proactively mitigate various operational risks in order to ensure the stable and steady progress of our enterprise.

In China, 2021 witnessed major shifts: the financialization of real estate was curbed, the marketization of healthcare and the capitalization of education were reversed, private ownership in media was reduced, and internet monopolies were dismantled. These transformations are truly taking place and have significantly altered public perception.

In early 2021, under the shadow of the pandemic, we resumed production. By April, the upgraded environmental protection campaign—“The Battle for Blue Skies and Clear Waters”—tightened restrictions, causing raw material prices to soar and creating unprecedented difficulties in production and operations. May through July brought material shortages and tight delivery deadlines. In September and October, production was nearly halted due to the 14th National Games held in Xi’an. These were all objective realities that we had to confront head-on, as our success is closely tied to that of our customers.

Yongxing Technology dug deep into its technological capabilities, harnessed its internal potential, and actively pursued innovation to stay aligned with the development trends in oil well logging instruments. Through upgrades in manufacturing equipment and the introduction of deep-hole processing machines, we achieved 100% self-sufficiency in this critical process. We also made significant breakthroughs in new product development:

• The High-Temperature Array Lateral Electrode and Large Rock Sample Resistivity Testing System passed CNOOC’s high-temperature, high-pressure tests and were successfully deployed—receiving strong positive feedback.

• The Array Lateral Electrode product addressed long lead times and high costs associated with imported alternatives.

• Products such as the 230°C-rated 55 Isolator, 55 Insulated Short Sub, Magnetically Neutral Calibration Room, Half-Space Device, and the 57.17 Hard Electrode Assembly were successfully delivered to CNPC Logging.

• Other innovations, including the High-Temperature Insulated Short Sub, Induction Shell, Dual Lateral Logging Electrode System, and the Dual Insulated SP Electrode Sub, have seen widespread use across major oilfields—earning universal praise.

In 2021, with full staff participation, Yongxing Technology successfully passed re-certification audits for Quality, Environmental, and Occupational Health & Safety Management Systems—affirming the continued effectiveness of our management practices in delivering qualified, reliable, and safe products. We reinforced process-wide execution of onsite management and team-based quality development, creating a work culture that values time efficiency and productivity.

We also treated supply chain management during the pandemic with the same importance as market strategy. We visited every material supplier and signed 21 agreements, including Integrity Charters and Confidentiality Agreements. All managers and engineers were reminded of our guiding principle: “Cultivate suppliers, stabilize the supply chain, and grow together.” We insist on working only with suppliers who are capable, reliable, and committed to quality—ensuring that our products are safe and trustworthy, built from the best materials available.

Today, the phrase “Respect every product, value every customer—big or small” has taken root in every employee’s heart and has become a part of their daily mindset.

In 2021, China announced its dual carbon goals of achieving carbon peak and carbon neutrality. At Yongxing, we see both opportunity and challenge in this policy shift. We responded by improving internal efficiency, raising per capita sales productivity, reducing electricity consumption, and doing our part to fulfill corporate social responsibility in energy conservation and emission reduction.

Since its founding, Xi’an Yongxing Technology has made it our mission to build a respected “Richa 瑞致” brand and to develop into a century-long enterprise. We have always stood by our principles of focus and professionalism—the cornerstone of our success. No matter how the domestic or global environment evolves, our mission and sense of duty will never change. As a specialist company serving China’s three major oilfield service providers with high-performance composite materials for logging instruments, we are committed to delivering exceptional quality and value. Our aim is to help clients gain and maintain competitive advantages, create tangible value through operational excellence, and elevate the Yongxing Technology brand to new heights. At the same time, we strive to ensure that every employee can share in the rewards of success and experience the joy it brings.

Let us face the ordinary and beautiful moments of life with peace and purpose—that is our best answer to an uncertain world.

In 2022, may everyone walk bravely toward the light, smiling through the wind and rain.

Wishing all friends, clients, partners, employees, and their families who have supported Weishi Power Transmission continued health, happiness, and success in the New Year!

                                                                                                             Chairman of Yongxing Technology
                                                                                                                      New Year’s Day, 2022 – Xi’an, China