We continue to stay informed about consumer preferences and the food trends, both in China and internationally. Our investment in R&D aims to refine our recipes and production methods for higher-nutrition snacks, convenience foods, and functional food products. These initiatives are planned not only to expand our product portfolio and strengthen our market position in the realm of healthier, higher-nutrition food products but also to potentially increase revenue for Zixin Group.

We outsource certain lower-margin snack products to processing manufacturers in the vicinity of Liancheng County while simultaneously upgrading our production lines to produce higher-margin snacks and convenience foods internally and enhance operational efficiency via greater automation. Zixin Group is poised to enhance our production capacity and diversify our product offerings at the high-tech manufacturing facility, which spans 83.6 mu (approximately 55,733.3 m2 or 5.6 hectares). This high-tech manufacturing facility will encompass a total built-up area of 86,000 m2 and possess an installed annual production capacity of 35,000 tonnes when fully completed. The production capacity expansion will be executed in three phases. The three automated production lines, which were installed as part of phase one of the capacity expansion, commenced commercial production in the second half of FY2026. Further expansion will be considered once this phase has stabilised.

Zixin Group is dedicated to leveraging advanced technological methods that require minimal processing. This approach facilitates the production of products with higher nutritional value, crafted from premium-quality sweet potatoes, to satisfy consumers’ growing demand for healthy, nutritious, and convenient options. We believe that this strategy will allow us to expand the applications of sweet potatoes across a diverse range of foods, thereby ensuring a relatively stable gross margin for this business segment.