Shandong Linglong Tyre Co., Ltd.2024 Annual Assessment Report on the Corporate Value and
Return Enhancement Action Plan and the 2025 AnnualCorporate Value and Return Enhancement Action Plan
In proactive response to the Shanghai Stock Exchange's Initiative onLaunching the Corporate Value and Return Enhancement Action Plan forShanghai-listed Companies, practice the development concept of "puttinginvestors first", and further improve the quality and value of the Company'sinvestments, the Company formulated and released the "2024 AnnualCorporate Value and Return Enhancement Action Plan" in March 2024,and actively promoted the implementation of relevant work based on theplan. In order to promote the long-term development of this work with highquality, the specific implementation situation of the Company in 2024 andthe Corporate Value and Return Enhancement Action Plan in 2025 arereported as follows:
I. Adhere to innovation driven approach, enhance corecompetitiveness, and achieve high-quality development
In 2024, the global economy is facing challenges such as rising tradeprotectionism, escalating geopolitical risks, and insufficient growthmomentum, presenting a characteristic of "coexistence of risks andopportunities". In the complex and ever-changing international situation,the Company adheres to focusing on its main business, actively promotes
global layout according to established strategies, accelerates productinnovation and upgrading, actively builds the core competitiveness of theenterprise, and continuously improves product profitability throughcontinuous adjustment and optimization of sales structure, achieving goodresults. In 2024, the Company achieved a cumulative sales volume of
85.4471 million units, a year-on-year increase of 9.57%; Operatingrevenue was 22.058 billion yuan, a year-on-year increase of 9.39%; Thenet profit attributable to the parent company was 1.752 billion yuan, a year-on-year increase of 26.01%.i. Implementing the digital transformation development strategy andaccelerating the creation of new quality productivityIn order to promote the high-quality layout of global industries andenhance the core competitiveness of the international market, LinglongTire firmly implements the "7+5" global strategic layout, graduallyimplements the digital transformation development strategy, and creates anadvanced tire factory that is intelligent in all fields, fully automated in allprocesses, and green in all aspects. It continuously promotes the process oftechnological leapfrog development, industrial optimization and upgrading,and overall productivity improvement.The Company continues to utilize the Industrial Internet of Things,AI, Big data, edge computing and other advanced technologies to build anintelligent manufacturing factory integrating digital, networking and
intelligence at home and abroad. Through digital intelligent productioncombined with lean management mode, product manufacturing capacity,quality and production efficiency are greatly improved. In 2024, theCompany's digital intelligence factory was successfully shortlisted for twoimportant lists by the Ministry of Industry and Information Technology.Among them, the "Linglong Big Data Platform Based on ArtificialIntelligence" was shortlisted for the Ministry of Industry and InformationTechnology's list of typical application cases of artificial intelligenceempowering new industrialization, and the "High-end Tire Full ProcessData Driven Intelligent Factory" was shortlisted for the Ministry ofIndustry and Information Technology's list of outstanding intelligentfactories (first batch) projects. At the same time, the Company alsoemphasizes the clever combination of innovative concepts, intelligentproduction, and green environmental protection. With its industry-leadinggreen development concept and intelligent innovation technology strength,it has won two honors, "Green Development" and "Intelligent InnovationTechnology", in the 2024 China Automotive Industry SustainableDevelopment Practice Case.In September 2024, the Phase I project of the Company's Serbia basewas successfully put into mass production. The products are mainlysupplied to the European and surrounding markets, representing high-levelintelligence, automation, and refinement in the industry, laying a solid
foundation for the Company to further expand its global market. TheLinglong Serbia factory is the first factory built by a Chinese tire companyin Europe, and also the largest greenfield investment project in Serbia todate. The completion of this project has driven the coordinateddevelopment of the local tire industry chain upstream and downstream,played a positive role in promoting regional economic development andimproving people's livelihoods, and created new momentum for theCompany's overseas market expansion and rapid growth in production,sales, and profits.ii. Continuously innovating and improving the product matrix
For many years, Linglong Tire has been driven by technologicalinnovation, continuously launching high-quality, high-performance, andhigh-tech tire products, enriching its product matrix, and meeting theincreasingly diverse needs of consumers.In 2024, the Company's Atlas ECO-LINE921, New Linglong Master,New Linglong Ultimate, new Linglong giant tire products and other newproducts were launched in succession. Among them, the New LinglongMaster series of passenger car tires is mainly aimed at mid to high-end carowners, with design standards benchmarked against international first-linebrands. The products integrate Linglong's leading innovative technologies,achieving leaps in performance, appearance, quality, service and otheraspects, continuously improving the driving experience of buyers. Since its
launch in early 2024, this series has won widespread praise in the market.The New Linglong Master-SPORT MASTER won the "Excellent Awardin Mass Production and Chassis System" at the 9th Lingxuan Awards; Thenew generation of commercial vehicle tires, the New Linglong Ultimateseries, adopts Linglong's pioneering honeycomb technology and stands outin the high-end commercial vehicle market with its outstandingperformance and quality.The environmentally friendly tires with a sustainable material contentof 79% developed and produced by the Company in 2024 have achievedthe highest EU level A in wet performance, noise performance, and rollingresistance performance through the use of sustainable and recyclablematerials and RFID chip technology, combined with Linglong Tire'slightweight technology. This demonstrates Linglong Tire's industryleadership in green travel and technological breakthroughs, and has wonthe "Prospective · Lightweight and New Materials Category · Gold Award"at the 9th Lingxuan Awards.At present, the Company has multiple high-performance tire productseries, including low noise, anti slip, ultra-low rolling resistance, ultra-highwear resistance, run on flat, SEALIN self-healing, LLST silent cotton, etc.It has passed a series of domestic and international certifications such asCCC, DOT, ECE, etc. In response to the EU labeling law, some of theCompany's products have reached AAA level, and the overall level has
reached the international advanced level. With excellent product qualityand performance, the Company has become the only enterprise in the tireindustry to have won the "Lingxuan Award" for five consecutive years, andhas been awarded multiple honorary titles such as the Shandong ProvincialGovernor's Quality Award and the China Market Quality AAA (UserSatisfaction Benchmark Enterprise) level.iii. Parallel development of OE and RE, comprehensive constructionof marketing systemIn 2024, the Company continued to promote the adjustment of OEbusiness structure, actively explored the mid to high-end market,cooperated with global OEMs, and made new breakthroughs in OEproducts for key global car series such as China, German, European,American, and Japanese. In 2024, the Company has added OE massproduction projects, including FAW Hongqi, BYD, Geely, SAICVolkswagen, American and Mexican BMW, General Motors, Volkswagenand other well-known domestic and foreign car manufacturers, and hasbecome the supplier of regular tires for Volkswagen Tiguan, entering theglobal high-end OE market. In addition, the Company has also achievednew breakthroughs in the OTR field, successfully supporting the world'slargest horsepower new energy tractor - Lingong Agricultural Machinery9E Series (ECVT), marking that Linglong Tire will begin to become thepreferred tire brand in the field of new energy tractors. According to the
2024 annual tire original equipment (OE) data report released by the ChinaPassenger Car Association (CPCA), Linglong Tire ranked first in terms ofthe number of OE models, tire sales volume, and market share among tirebrands for models with annual sales exceeding 5,000 units; The OE fieldof new energy vehicle tire has been ranked first in the industry for manyconsecutive years, and its brand influence in major domestic and foreignOEMs is constantly increasing.In September 2024, the Linglong Vehicle Maintenance Workshopserving passenger car tires was officially renamed Atlas VehicleMaintenance Workshop, and the development and operation efficiency wasfurther improved. In 2024, Linglong Tire has continuously launchedprofessional projects such as new energy tire repair, "Chassis Doctor" – tire+ chassis characteristic business, refined operation of core business, andoperator business capability training, actively explored opportunities fornew energy vehicle maintenance, vigorously promoted full platform andcommunity-based brand marketing and targeted traffic acquisition throughthe extensive gathering of high-quality industry resources, and open upnew profit growth channels for stores with distinctive services, ultimatelyachieving a win-win situation for brands, stores, operators, and users.Based on the independently developed new retail 3.0 digitalintelligent SAAS system, Atlas Truck Mate Home, which servescommercial vehicle tires, has achieved full coverage of the PC back end,
APP and mini programs at the supplier end, Truck Mate Homeheadquarters end, operator end, storage and distribution end, store end,logistics fleet end and driver owner end. By the end of 2024, a total of 101prefecture level city operators in 24 provinces have been developed, withfull coverage achieved in prefecture level cities in Shandong, Henan, Hebei,and Jiangsu provinces; Completed the establishment of approximately1,061 authorized stores and 40 flagship stores of Truck Mate Home, withthe Truck Mate Home app achieving over 340,000 registered and certifiedtruck drivers.In order to enrich the sales network and further enhance productawareness, Linglong Tire signed a strategic cooperation agreement with JDAutomotive in April 2024. This is an innovation and upgrade in LinglongTire's marketing field, which not only achieves a dual leap in brandexposure and sales conversion, but also explores a new path of userdemand-oriented and integrated online and offline development. As of now,the two parties have engaged in deep cooperation in multiple dimensionssuch as product sales, omni-channel service network, and global marketing,and have opened up new cooperation models in the automotive aftermarket.In November 2024, Linglong Tire became one of the first brands toparticipate in government trade in subsidies.iv. Building a three-dimensional communication network to promotebrand value enhancement
In 2024, Linglong Tire's core goal is to break through the value of itsglobal brand. Through a collaborative model of "strategic resourceallocation + precise scene penetration + digital content fission", LinglongTire has successfully achieved a significant increase in brand awarenessand premium ability. In June 2024, the World Brand Lab released ananalysis report on the top 500 most valuable brands in China for 2024. Thebrand value of Linglong Tire reached 98.137 billion yuan, a year-on-yearincrease of 19.5%; In the "2024 Global Most Valuable Tire Brands" listreleased by Brand Finance, a British brand value consulting firm, LinglongTire once again made it to the list, becoming the only Chinese tire brand tohave been on the list for five consecutive years. In 2024, through theconstruction of a three-dimensional communication network that linksonline and offline, the Company's brand promotion has doubled in itsoverall reach, reaching a total of 2.136 billion person-time throughout theyear.At the same time, the Company continues to deepen its sportsmarketing strategy. In 2024, the Company renewed contract withWolfsburg and added two new partners, Chelsea and Real Madrid,achieving full coverage of the English Premier League, La Liga, andBundesliga, successfully building the "iron triangle" of top Europeanleagues; By participating in product performance verification activitiessuch as the Macau GT competition and FDJ drifting competition, as well
as integrating into the wider sports ecosystem such as Go competitions, weaim to further accelerate the global influence of the Linglong brand.v. Actively practicing ESG concepts and fully promoting the processof sustainable developmentLinglong Tire has been adhering to international standards for manyyears, actively practicing ESG concepts, and continuously promoting thegreen development process of the enterprise. The Company adheres to thesustainable development concept of "harmony, wisdom, and green", andintegrates ESG governance into various aspects of daily operations such aseconomy, environment, and social responsibility. Through active measuressuch as developing new materials, new equipment, new energy, newtechnologies, new processes, and building a responsible supply chainsystem, it continuously injects strong momentum into the high-qualitydevelopment of the enterprise. As of 2024, the Company has voluntarilydisclosed sustainability reports for seven consecutive years, showcasing itspractices and achievements in environmental protection, socialresponsibility, internal management, and supply chain construction frommultiple perspectives. In 2024, the Company won multiple honors such asMSCI "BB" rating, Huazheng ESG "AA" rating, Ecovadis bronze medal,EY Sustainable Development "Outstanding Enterprise of the Year",Securities Market Weekly ESG Golden Dawn Award, Southern WeekendAnnual Outstanding Responsible Enterprise, and was selected for the
ESG+8 "Value 100" list by Yi Dong. Its sustainable developmentachievements have been recognized by authoritative institutions.In addition, Linglong Tire is also the first tire enterprise in ChineseMainland to join the Global Platform for Sustainable Natural Rubber(GPSNR), one of the most influential international cooperation platformsin the field of natural rubber. The Company has publicly released andcontinued to implement the Sustainable Natural Rubber Policy, activelypromoting cooperation with stakeholders and collaborating with suppliersto jointly promote the construction of a sustainable natural rubber supplychain. In September 2024, the Company submitted its GPSNR annualreport and it has been reviewed by the organization.2025 is the final year of China's 14th Five Year Plan. With thecontinuous changes in the global economic environment and automobilemarket, coupled with the intensification of international trade frictions,Chinese tire companies will face more intense market competition. In themarket environment full of challenges and opportunities, the Company willcontinue to adhere to the development concept of "innovation, quality,service, management, and sustainability", and focus on the business policyof "leading the team, laying the foundation, grasping management,improving level, and creating first-class". It will continue to promote thewidespread application of digital, networked, and intelligent technologiesin the entire process of tire production, sales, and use, constantly seek
effective ways to reduce operating costs, improve operating quality andefficiency, and continue to deepen global layout, accelerate the landing andrelease of new production capacity in Changchun factory and Serbiafactory. Linglong Tire will also continue to promote the continuousimprovement of Linglong brand influence and profitability throughmeasures such as "three structural adjustments" of OE businesses, productinnovation, and comprehensive construction of marketing system, to buildthe core competitiveness for the long-term development of the Company.II. Improve the Company's institutional system and continuouslyenhance governance effectivenessi. Optimize institutional construction and build a solid foundationfor corporate governanceThe Company strictly adheres to the requirements of laws andregulations such as the Company Law, Securities Law, Code of CorporateGovernance for Listed Companies, and Shanghai Stock Exchange ListingRules, continuously strengthens standardized operations, and continuouslyimproves and perfects the corporate governance structure and internalcontrol system. In 2024, the Company revised and improved relevant rulesand regulations such as the Articles of Association, Independent DirectorWork Rules, and Independent Director Special Meeting Work System inaccordance with newly issued or revised regulatory regulations such as theManagement Measures for Independent Directors of Listed Companies,
further clarifying the responsibilities and management of independentdirectors, optimizing performance methods, and enhancing performanceeffectiveness. In addition, the Company has revised and improved anumber of internal management systems and regulations, including theRules of Procedure for the Board of Directors, Detailed Rules for the Workof the Board of Directors' Nomination Committee, Detailed Rules for theWork of the Board of Directors' Remuneration and Appraisal Committee,Internal Audit System, and Management System for the Market Value ofListed Companies, laying a solid institutional foundation for theCompany's continuous standardized and efficient governance.ii. Strengthen the responsibility of the 'critical minority' and enhanceinternal management efficiencyThe Company continues to strengthen the training of directors,supervisors, and senior personnel, actively organizing and participating invarious business training organized by regulatory agencies or associationssuch as stock exchanges, jurisdictional securities regulatory bureaus, andlisted company associations. Compliance reminders are provided duringthe Company's periodic reports, major events, or other specific eventwindow periods to enhance relevant personnel's understanding ofinformation disclosure, major event reporting, and insider informationmanagement responsibilities, and to improve the compliance awarenessand performance ability of the “critical minority" group. In 2024, there
were no violations of national laws, regulations, regulatory rules, orinternal management systems or rules of the Company.In 2025, the Company will continue to operate in a standardizedmanner, strictly in accordance with the requirements of the new CompanyLaw and related supporting institutional rules, and continuously improveand perfect the corporate governance structure and internal control systembased on the actual situation of the Company, laying a solid foundation forthe system. By regularly conducting compliance inspections and riskassessments, it aims to comprehensively improve the Company'sstandardized operation level and enhance its risk prevention capabilities.At the same time, it will strengthen the training of "critical minority" suchas directors and senior management personnel, promote the continuousimprovement of their professional abilities and work capacity, and activelyplay the role of independent directors, providing comprehensiveguarantees for independent directors to perform their duties from resourceallocation, information support, and other aspects, ensuring thatindependent directors fully play their supervisory and decision-makingroles.III. Strengthen the quality of information disclosure and investorrelations management, comprehensively enhance shareholdersatisfactioni. Strictly regulate information disclosure and promote quality
improvementThe Company strictly adheres to the requirements of relevant lawsand regulations such as the Company Law and the Securities Law,conscientiously implements the information disclosure principles of"truthfulness, completeness, accuracy, timeliness, and fairness", andfulfills its disclosure obligations, ensuring the comprehensiveness,accuracy, and high quality of the disclosed content. At the same time, inorder to enhance the transparency of the Company's information andfacilitate investors to better understand the progress of the Company'sbusiness and strategic planning, in 2024, voluntary disclosure was carriedout in addition to the required disclosure of information, including investorrelations activity records, shareholder return related plan announcements,business performance reports, etc., actively promoting the Company'svalue transmission. In the "Evaluation Results of Information DisclosureWork of Shanghai Stock Exchange Listed Companies for 2023-2024"released by the Shanghai Stock Exchange, the Company once againreceived the highest rating of "A", which is the fifth consecutive year thatthe Company has received this honor.ii. Enhance the effectiveness of investor relations management andstrengthen shareholder communicationThe Company always attaches great importance to the managementof small and medium-sized investors, treats all shareholders equally,
actively builds multi-dimensional communication channels for investors,and ensures good communication efficiency and effectiveness. In 2024, theCompany held three performance briefing meetings through onlineinteraction and on-site communication, and answered 226 questions fromE-Interactive investors. Except for the window period, the Companyreceived a total of 97 investor surveys. In addition, in order to better servethe capital market, the Company has also supplemented dedicated investorrelations management personnel in 2024, further strengthening proactivemarket communication and improving the frequency and quality ofshareholder communication through multiple channels. At the same time,an "Investor Relations Map" has been established to regularly track andanalyze the characteristics and changes of shareholding institutions,summarize and record communication situations and market voices, timelyconvey suggestions or opinions raised by investors to management, andprovide reference for the Company to formulate and adjust investorrelations strategies at various stages.iii. Adhere to the principle of putting investors first and valuingshareholder returns
Since its listing in 2016, the Company has always been investororiented and highly values reasonable investment returns for shareholders.From 2017 to 2024, the Company has continuously and steadily distributeddividends annually, with a cumulative cash dividend of approximately
3.312 billion yuan, ranking among the top listed tire companies in China,and the dividend ratio has remained at a relatively high level of over 30%of the net profit attributable to the parent company in the consolidatedfinancial statements for that year. In 2024, in order to actively respond toregulatory calls and implement a "long-term, stable, and sustainable"shareholder value return mechanism, the Company also proactivelyincreased the frequency of cash dividends and implemented quarterlydividend plans to better enhance shareholder satisfaction. In addition, theCompany implemented a major shareholder increase plan in 2024. FromAugust 9, 2024 to January 22, 2025, the controlling shareholder LinglongGroup increased its holdings of 7,981,100 shares of the Company throughthe centralized bidding trading system of the Shanghai Stock Exchange,with a cumulative increase amount of 150.0024 million yuan.
In 2025, the Company will continue to strengthen the quality ofinformation disclosure, improve the effectiveness of informationdisclosure on the basis of compliance, actively build open, fair, transparentand multi-dimensional market communication channels, and furtherenhance the frequency of proactive communication among institutionalshareholders to actively convey the long-term investment value of theCompany to the market, while ensuring the efficient and smooth operationof public channels such as the Shanghai Stock Exchange Roadshow Center,E-interactive platform, investor hotline and email.
In 2025, the Company will continue to strive to provide reasonableinvestment returns for its shareholders, prioritize the use of continuous andstable cash dividends for profit distribution, and plan to increase thefrequency of profit dividends for 2025 in a timely manner, subject to theauthorization of the shareholders' meeting and profit distributionconditions. Specific measures include:
1. The Company plans to implement a cash dividend plan for thefourth quarter of 2024, and the dividend ratio will account for 50.52% ofthe net profit attributable to the parent company in the fourth quarter of2024. After the implementation of the cash dividend plan in the fourthquarter, the overall dividend ratio of the Company in 2024 will continue toremain at a relatively high level of over 30%.
2. The Company plans to implement a quarterly cash dividend planfor the year 2025. According to the Guidelines for the Supervision of ListedCompanies No. 3- Cash Dividends of Listed Companies, Shanghai StockExchange Listing Rules, Articles of Association and other relevantregulations, it is requested that the shareholders' meeting authorize theBoard of Directors to fully handle matters related to quarterly profitdistribution. The Board of Directors shall formulate the Company's 2025quarterly profit distribution plan based on the Company's profitability andfunding needs, provided that the total amount of annual cash dividendsaccounts for no less than 30% and no more than 40% of the net profit
attributable to shareholders of the listed company of 2025, and implementit within the prescribed period. The above plan will be submitted to theannual shareholders' meeting for further review after being approved bythe Company's annual board of directors on April 24, 2025.
In the future, the Company will continue to track and evaluate theimplementation of the Corporate Value and Return Enhancement ActionPlan at all stages, strictly fulfill its information disclosure obligations, andcontinue to focus on its main business, strive to improve its managementlevel, continuously enhance its core competitiveness, profitability, and riskmanagement capabilities. Through standardized corporate governance,good performance, and stable investor returns, the Company willeffectively fulfill its responsibilities and obligations as a listed company,give back investor trust, maintain the Company's market image, and jointlypromote the stable and healthy development of the capital market.Risk warning: the Corporate Value and Return Enhancement ActionPlan is based on the current situation of the Company. In the future, it maybe affected by macroeconomic policy adjustments, fluctuations in the tireindustry, and the secondary market environment, and there is a certaindegree of uncertainty. Investors are advised to invest rationally and payattention to investment risks.Announcement is hereby given.
Board of Directors of Shandong Linglong Tyre Co., Ltd.
April 24, 2025
This report has been prepared in Chinese and English respectively. In caseof discrepancy in the translation of this report, the Chinese version shallprevail.