Dongjiang Environmental Company Limited provided earnings guidance for the six months from 1 January 2022 to 30 June 2022. For the period, the company expects net profit attributable to shareholders is between approximately RMB 19,000,000 to RMB 25,000,000 (corresponding period of last year: approximately RMB 111,639,800), representing a year-on-year decrease of 82.98% to 77.61%; the net loss after non-recurring gains and losses attributable to shareholders of listed company is between approximately RMB 3,000,000 and RMB 5,000,000 (corresponding period of last year: earnings approximately RMB 108,607,700), representing a year-on-year decrease of approximately 102.76% to 104.60%; basic earnings per share is between approximately RMB 0.02 and RMB 0.03 (corresponding period of last year: approximately RMB 0.13). Affected by the intensified competition in the industrial waste treatment market, and at the same time due to the suspensions and restrictions of production in some areas as a result of the COVID-19 pandemic, the industrial waste treatment industry is facing steep challenges.

During the Reporting Period, the Company enhanced market expansion efforts, improved the volume of collection, transportation and disposal of hazardous waste, and ensured the growth in operating income as compared to last year. Nevertheless, the gross profit margins of hazardous waste treatment and disposal and recycling businesses dropped significantly as compared to last year due to the trend of declining prices of hazardous waste treatment and the trend of increasing production costs of recycling products during the Reporting Period. Faced with the challenging situation caused by intensified competition in the industrial hazardous waste market, the Company will leverage its core competitive advantages and implement multiple measures to improve its operating results.

Firstly, the Company will use its advantages in planning and channeling, adopting the market strategies of "exchanging price for volume, seizing the market" and "concentrating efforts to develop core customers", strengthen market expansion continuously, with a view to ensuring a new high in the annual volume of collection and transportation. Secondly, the Company will also explore deeply into customer needs, providing diversified, high-quality and all-in-one value-added services, so as to ensure the steady growth of the number of high-quality customers, and simultaneously promoting a number of specific tasks such as "slimming and fitness", "Cost Reduction and Efficiency Enhancement" and "Digital Transformation" etc., enhancing details-oriented management, making all efforts to improve the overall profitability of the Company.