Stock
Code：603883

2025

Environmental Social and Governance ReportContents

Sustainability

Management Social

Words from the Chairman 01

About The Report 02 1.1 ESG Governance 10 3.1 Quality Control 40

About LBX Pharmacy 03 1.2 Management Strategy 12 3.2 Supply Chain Safety 46

ESG Performance Highlights 07 1.3 Stakeholder Communication 14 3.3 Health Services 54

ESG Rating Performance 08 1.4 Assessment of Materiality 15 3.4 Innovation-driven 62

Issues

3.5 Employee Development 71

3.6 Responsible Citizens 82

Governance Environmental

Appendices

Appendix 1. Table of 98

2.1 Corporate Governance 21 4.1 Environmental Compliance 87

Responsibility Performance

Management

2.2 Compliance Operation 26

Appendix 2. Table of Index to 102

4.2 Addressing Climate Change 90

Standards

2.3 Information Security & 34

Appendix 3. List of Laws and 107 Customer Privacy Protection 4.3 Use of Energies and Resources 93

Regulations

2.4 Party Building Work 38 4.4 Green Operation 95Contents Words from the Chairman 2025 Environmental Social and Governance Report 01

Words from the Chairman

Global climate change public health challenges and the wave of digital technologies are reshaping the business model of the health industry.In the face of changes and uncertainties LBX Pharmacy upholds "doing everything for ordinary people" as its business philosophy deeply

integrates ESG governance into its operations management and continuously promotes the resonance of its commercial and social value with

strategic transformation as the engine digital AI as the support and accountability as the foundation.In 2025 with the fighting spirit of "the second venture" we started the transformation of the whole value chain. Focusing on the frontline and

customers we took multiple measures simultaneously to drive steady improvement of our operations. More importantly with long-term value

growth as the core we were no longer satisfied with the completion of single commodity transactions but were committed to building long-

term stable trusting relationships with consumers and partners to lay a solid foundation for our future development.“ For consumers we expanded and upgraded diversified health services from single drug sales provided value-added services such as chronic disease management and medication tracking and extended transactions from "sales closing" to long-term "health companion". For our supply chain partners we were open and collaborative jointly built a drug traceability system carried out the reform of our commercial procurement system and promoted the win-win development of the industrial chain. For industry partners we actively shared experience and made our resources openly accessible to empower small and medium-sized chain pharmacies by joining alliances and promoted the industry from "price involution" to "value upgrade". As a deputy to the 14th National People's Congress I continuously promoted upgrades based on the development of the industry as well as people's livelihood and health needs and actively made suggestions for accelerating the construction of a healthy China. We continuously sustained such "trust" with professionalism warmth and accountability making LBXPharmacy not only like a reliable lamp in the community but also an ecological community that could stand the test of time and was worthy

of the trust of all parties.In the era of digital intelligence AI became an important tool for improving the efficiency of ESG actions. In 2025 we established the Group's

AI Application Strategy Committee to stabilize our R&D investment independently develop intelligent agents promote the exploration and

application of AI in various business modules of operation procurement merchandising and internal management and help improve the

operational quality and efficiency of the whole value chain. While empowering development with technologies we also honored our

commitment to the ecological environment drove energy conservation and consumption reduction through technology optimization

increased the application of clean energies practised green operation and helped synergistically better our economic and environmental

benefits.In essence business is humanistic and the development of enterprises is inseparable from being driven by people. In the past year we made

every effort to promote "merchant" transformation. Our management continuously visited the frontline listened to the employees' voices

optimized our incentive mechanism improved our talent training and fully stimulated all our employees' vitality. We firmly believed that only

when employees were more professional and cordial could they better serve customers and care for the society thus making the Company

more accountable. We also continuously received positive feedback. A 90-year-old man's handwritten thank-you letter to LBX's pharmacists

Xie Zilong FounderChairman and President of LBX Pharmacy for their professional services tens of thousands of "Love Stations" which became warm harbors for numerous outdoor workers and 4231

excellent cases of "altruistic" services that emerged throughout the year... and so on epitomized the daily improvements made by more than

50000 "LBX members" and were the most vivid annotations of responsibility.

Embracing the future the state will vigorously develop the real economy and nine ministries of China will jointly issue documents to support the high-quality development of retail pharmacies. With the further

acceleration of aging and the continuous upgrading and expansion of residents' health needs physical pharmacies will enter a window period for a new round of strategic development. LBX Pharmacy will deeply

remain committed to facilitating the development of physical pharmacies. With the overall strategy of building a technology-driven health service platform we will continue to deepen our reforms around services

technologies ecology and talents to build a sustainable business ecology in an all-round manner.What is health It is the foundation for the happiness of tens of millions of families the cornerstone of a wonderful life and the simplest and firmest ESG commitment of LBX Pharmacy. Always show reverence for

life which shall be prioritized and make medical and health services that are not inferior to those in cities available in towns and villages. Enable patients with chronic diseases to obtain scientific medication

guidance without frequently going to a hospital new parents to calmly take care of their children in their daily life and everyone who works hard for life be healthy... LBX Pharmacy is willing to always make

concerted efforts with all parties promote business improvement with long-term persistent efforts and create a healthier and more sustainable future together.Contents About This Report 2025 Environmental Social and Governance Report 02

Reporting Scope and Boundary

About This This is an annual report externally disclosed every year.The reporting entity and reporting period of this Report are the same as those of the Company's annual report 2025. The reporting period extended from

Report January 1 2025 to December 31 2025. To enhance the integrity of the report contents some contents or explanations are appropriately extended forward

or backward in time.Unless otherwise stated the scope of disclosure in this Report is consistent with that of the Company's financial report and consolidated statements 2025.T h e E n v i r o n m e n t a l S o c i a l a n d

The environmental performance covers the self-owned pharmacies medical centers and traditional Chinese medicine factories as well as logistics

Governance (ESG) Report 2025 of LBX centers employee canteens and offices that LBX Pharmacy has the right to control their operations and operated throughout 2025.Pharmacy Chain Joint Stock Company

(hereinafter referred to as "this Report") is Data Sources and Information Descriptions

the eleventh ESG report that has been

issued by LBX Pharmacy Chain Joint Stock The data and case information in this Report are mainly from the statistical reports and related documents of the Company. The operational data

Company (hereinafter referred to as "LBX disclosed in this Report are all from the Company's annual report 2025. Unless otherwise stated all monetary amounts included in the report are

denominated in RMB.Pharmacy" "the Company" "the Group"

"we") since its listing (the reports issued This Report is made in both Chinese and English. In case of discrepancy between the Chinese and English versions the Chinese version shall prevail.from 2015 to 2022 are social responsibility

reports and those issued from 2023 to Deliberative Process Forward-looking Statements

2025 are ESG reports). This Report

This Report was approved upon deliberation at the Except for events that have occurred all possible future events described hereunder fall

objectively transparently and completely

fourteenth meeting of the 5th Board of Directors of the within the scope of these forward-looking statements including but not limited to

discloses the Company's ESG concept Company and released. The Board of Directors of the expected objectives action plans assumptions of climate change scenarios climate risks

practice and performance in 2025 in a Company undertakes to supervise the content of the financial impacts etc. Due to external risks uncertainties and other factors beyond our

standardized manner. report to ensure there are no false records or misleading control the actual future development results or trends of the events mentioned might

statements and is responsible for the authenticity differ from the forward-looking statements in this Report. The Company does not assume

accuracy and completeness of the content. responsibility for updating related statements and events in case that they are not realized.Basis for Compilation Acquisition of and Response to This Report

This Report has been compiled mainly with reference to the standards below: You may obtain more ESG information from LBX Pharmacy or download the electronic copy

of this Report through the following methods:

·Guidelines No. 14 of Shanghai Stock Exchange for Self-Regulation of. Listed Companies - Sustainability Report (Trial)

(hereinafter referred to as "SSE Sustainability Report Guidelines") Guidelines for Self-regulation of Listed Companies on · Official website of LBX Pharmacy: https://www.lbxdrugs.com

Shanghai Stock Exchange No.4 - Sustainability Development Report (hereinafter referred to as "SSE Sustainability

Report Guide") · Official website of Shanghai Stock Exchange: http://www.sse.com.cn

·Corporate Sustainability Disclosure Standards - Basic Standards (Trial) and Application Guidelines for Corporate If you want to obtain a paper version of this Report or have any comments or suggestions

Sustainability Disclosure Standards - Basic Standards (Trial) issued by the Ministry of Finance of the People's Republic of about this Report you may contact us as follows:

China Address: Securities Affairs Department 808 Luohu Road Kaifu District Changsha Hunan

·Global Reporting Initiative (GRI) Sustainability Reporting Standards (GRI-Standards 2021) of the Global Sustainability Province

Standards Board

Tel.: 0731-84035189

·Guidelines No. 2 International Financial Reporting Sustainability Disclosure Standard - Climate-Related Disclosures

Email: ir@lbxdrugs.com

(IFRS S2) published by the International Sustainability Standards Board (ISSB).This Report follows the latest sustainability reporting standards prior to the publication of the current annual report for Your comments and suggestions are important basis for us to continuously

information disclosure. Due to the continuous revision and update of the reporting standards the contents of this promote our sustainability management and practice.Report might differ due to iteration of Chinese and English expressions understandings and versions. We will update it

iteratively to continuously improve the quality of our information disclosure.Contents About LBX Pharmacy 2025 Environmental Social and Governance Report 03

About LBX Pharmacy

Brands

Stock Code:

A top 5 0 0 enterprise in China's

service industry

With 1 4 9 7 5 stores all over China

With operating income of

RMB22.237billion in 2025

11114

Pharmacy chain Third-party Foreign strategic Traditional Regional logistics

LBX Pharmacy (a company listed on the main board of Shanghai Stock Exchange; stock code: 603883) is a leading enterprise in franchise brand pharmaceutical partners and Chinese clinic centers

retail alliance marketing chain brand

China's pharmaceutical retail industry a top 100 champion in comprehensive competitiveness among China's pharmaceutical service platform agencies

retail enterprises a top 500 enterprise in China's service industry and a top 100 enterprise in Hunan Province.Since its establishment in 2001 the Company has successfully developed 18 provincial markets such as Hunan Jiangsu Anhui

and Gansu with about 15000 stores and nearly 60000 employees (including franchisees). In 2025 our operating income was

RMB 22.237 billion our total assets amounted to RMB 19.845 billion. Our tax payments exceeded RMB 895 million. Corporate Culture

Having been deeply ingrained in the health industry for more than 20 years LBX Pharmacy always maintains its strategic intent.Consistently adhering to its original intention of "doing everything for ordinary people" it is committed to providing professional Corporate mission: Professional services bring more warmth and always keep

and warm health management services for ordinary people. In recent years the Company has made continuous breakthroughs ordinary people healthy

and innovations continuously deepened the transformation of digital AI and driven business development. It has accurately

Corporate vision: Remain committed to health undertakings and create

empowered small and medium-sized chain and single pharmacies vigorously built a "large-scale ecosystem" for century-old stores

pharmaceutical retail vigorously developed the industry's high-standard pharmacy franchise model alliance model

Business philosophy: Do everything for ordinary people

professional DTP pharmacies tradition Chinese medicine clinic chains and other business patterns promoted the full-time

global and full-product integration of new retail and made every effort to build a technology-driven health service platform. At Core values: Customer-oriented simple efficient upright and accountable

present the Company owns subsidiaries such as LBX Health Pharmacy (franchise) Easydrug (alliance) MYLH (wholesale)

Corporate spirit: Altruistic equal pragmatic and innovative

Baixingtang Famous Medical Clinics and Fengwoda Logistics forming a complete pharmaceutical industry ecosystem.Corporate strategy: Vigorously build a technology-driven health service platform

At the same time of its rapid development LBX Pharmacy has actively participated in public welfare undertakings conveying

social love and warmth with actions. So far the Company has donated more than RMB 100 million to social welfare such as Social responsibility concept: Treat customers employees and partners kindly

disaster relief epidemic prevention poverty alleviation education assistance and rural revitalization in collaboration with its

Four mechanisms: Incubation mechanism sharing mechanism PK mechanism

partners. The Company has been successively granted several honors including national honor as "Advanced Group Making riskcontrolmechanism

Contributions to Complete Construction of a Moderately Prosperous Society" Super Brands in China and TOP100 Champion in

Talent concept: Struggle-oriented and merit-based appointment

Overall Competitive Strengths among Chinese Drug Retail Enterprises (for 12 times).Orienting towards the future LBX Pharmacy will be deeply ingrained in the health industry firmly build a technology-driven Learning concept: Jointly build a learning organization and make self-improvement

health service platform provide more professional smarter and more altruistic services for ordinary people in the silver-haired

Communication concept: Never take anything personally and tell right from wrong

economy with a more correct healthy lifestyle and help build a "healthy China".Nine redlines: See page 32Contents About LBX Pharmacy 2025 Environmental Social and Governance Report 04

Growth Footprints

2020-2022202220242025

Guaranteed supply at stable Owned more than 10000 stores and became Owned more than 15000 stores. Started a new round of "double-line"

prices and provided free the first private listed chain pharmacy in China Honorably evaluated as "TOP100 Champion in Overall transformation fully stimulated the vitality of the

medicines to "fight against the with more than 10000 stores. Competitive Strengths among Chinese Drug Retail organization and drove the upgrade of the whole

epidemic" awarded as The annual operating income exceeded RMB 2 Enterprises" for the twelfth time. value chain with digital AI."Enterprise with Outstanding billion. Honorably awarded the "National May 1 Labor Medal". Ten thousand stores across the country set up

Contribution to Epidemic

Historically obtained the largest-scale equity "Love Stations" to create a positive model for the

Prevention and Control" by

financing and raised RMB 1.74 billion from non- Company to serve grassroots people's livelihood.governments of several areas.public offering in total.

201920152015-2018201520142011

Completely initiated The Company's annual Acquired chain pharmacies such as Lanzhou LBX (603883) was Started the new retail The registered

digital transformation sales exceeded RMB Huirentang and Yangzhou Baixinyuan. The officially listed for trading business of online e- trademark "Lao

and strove to build a 10 billion. "Spark Plan" realized a new model for on the Shanghai Stock commerce and Baixing" was

technology-driven extension and expansion. Exchange. realized offline and recognized as a

health service platform. Continuously developed innovative businesses online integration. well-known

such as Mingyu Longxing LBX Health Pharmacy trademark in China.(franchise) Baixingtang and Easy Drug to

transform and upgrade toward health services.

200120022003200520082009

The Company was Xi'an Xincheng Store and Guaranteed supply at Established Forworld Successfully introduced Acquired Xiangtan Haicheng Pharmacy (32

established and Hangzhou Guodu Store stable prices to actively Medicine Logistics and foreign capital became a stores) realizing the first large-scale

Changsha Xiangya Store were opened in fight against "SARS" further improved the Sino-foreign joint venture acquisition.was opened. China's first succession forming a awarded as "Advanced industrial chain layout. and entered a new stage Joined in the United Nations Global Compact

affordable pharmacy chain business pattern Anti-SARS Organization" of corporate governance. established a public welfare organization

model was created. that was successfully by government known as "LBX Love Gathering" and started

extended out of Hunan authorities. the journey to corporate public welfare.Province.Contents About LBX Pharmacy 2025 Environmental Social and Governance Report 05

Future Strategy

"Vigorously build a technology-driven health service platform"

LBX Pharmacy will insist on being deeply engaged in the health business and firmly build a technology-driven health service platform by focusing on seven major strategies namely empowering with digital

AI capturing the blue ocean market of prescription drugs embracing new retail advancing into new rural areas expanding health and social spaces for the elderly cultivating private brands and exploring

diversification. Meanwhile we will actively undertake our corporate social responsibility and build a sustainable pharmaceutical retail ecosystem.Capturing the Blue Ocean

Empowering with Digital AI Embracing New Retail

Market of Prescription Drugs

Continuously promote the transformation and Actively promoting clinics coordination and relying Actively create "Internet plus" smart medical and

innovation via digital AI further use digital AI tools on its resources such as nationally unified high- health services and create differentiated online

to empower stores and store clerks and bring standard dual-channel stores DTP stores outpatient advantages through digital AI empowerment;

professional and caring service experience to chronic and special disease stores and the integrate private domains with members and

customers; solve pain points and difficulties in work advantage of a relatively high licensed pharmacist accurately match user needs to continuously meet

through intelligent tools and information staffing rate in the industry the Company will actively users' diversified health service needs and further

technologies; increase management efficiency at connect with prescription circulation platforms increase the accessibility of medical resources.all levels and organizational operation efficiency. successively launched in different regions to

undertake more outflow prescriptions.自

Advancing into New Expanding Health and Social Cultivating Private Brands Exploring Diversification

Rural Areas Spaces for the Elderly

While focusing on the advantageous market Seize the opportunity of "silver-hair economy" Focusing on scenarios such as "health Focusing on the healthy life needs of ordinary

we will vigorously develop the lower-tier and provide professional services such as management health preservation health people explore diversification around new

market build a three-dimensional expansion medication consultation health consultation exercise" build a user-centered product categories new services new images and

network through self-construction M&A and chronic disease management in stores to system take advantage of the Company's new minds in an attempt to become a trusted

franchising and alliances create a large improve customer stickiness. Pay attention to "online + offline" omni-channel advantages "Health station" for communities.pharmaceutical retail ecology pool more the life and emotional needs of the elderly build a healthy domestic brand favored by

extensive local resources take advantage of provide convenience services silver-hair ordinary people and procure safe healthy

store management and practise the strategy services etc. and develop the stores into and cost-effective healthy life supplies to

for "new rural areas". healthy spaces with social attributes. enter thousands of households.Contents About LBX Pharmacy 2025 Environmental Social and Governance Report 06

Honorary Titles and Awards

Association Qualification * Annual Honors

Vice Chairman Unit

China Enterprise Confederation China

China Association of 07/2025 Enterprise Directors Association

Pharmaceutical Top 500 Chinese Service Enterprises 2025

Seventh Best Managed Companies

Commerce

Project Hunan Federation of Enterprises and

01/2025 (Deloitte China HKUST Business School Industrial Economy

Harvard Business Review (Chinese Version) Top 100 Enterprises in Hunan 2024

8th China Excellent IR

Best Managed Companies (BMC) 2025

Best Capital Market Communication CDAPS 2025

Award

The 21st China Annual Retail Changxing Gold Award · Juxin Award for Chinese

Pharmacies 2025

Chairman Unit Pharmacy Conference and the 6th

China Nonprescription China Professional Pharmacy 03/2025

Medicines Association Development Forum 10/2025

Chinese Pharmacy (China Association of Pharmaceutical Commerce) Hunan Provincial Department of Finance

TOP 100 Chinese Pharmacy in Value Top Ten in Total Sales among Chinese

TOP 100 Enterprises with Outstanding Tax

2024-2025 Pharmaceutical Retail Enterprises in 2024

Contributions in Hunan Province

Best Health Station Pharmacy Excellent Health

Xiding Fair 2025 in 2024

Station Pharmacy Standard Psoriasis

Outstanding Chinese Pharmaceutical

Demonstration Store Standard Thyroid

Retail Chain

Demonstration Store

Chairman Unit 2024-2025

Hunan Association of 11/2025

the Pharmaceutical

Shanghai Stock Exchange

Distribution Industry Rated A in information disclosure work from 2024 to

2025

04/2025 Healthcare Traffic Conference 2025

CPEO 2025 Professional Service Award of Healthcare Traffic

West Lake Award of Wuzhen

Champion among Chinese Drug Retail Conference 2025

Health Conference 2025 Enterprises in Competitive Strength - Brand

Power 2025 China Chain Store & Franchise Association Vice Chairman Unit Chinese Pharmaceutical Retail Best Innovation Practice Case for China's Consumer

Growth Enterprise

Hunan Pharmacist TOP100 Drug Retail Champion in Overall Products 2025

Association Top 20 Leading Digital Pharmaceutical Competitiveness 2025

Retail Enterprise TOP 10 Urban Drug Retail Groups in

China Specialized Pharmacy Competitive Strength 2025 12/2025

Construction Excellence Award 2024 Government of Hunan Province

TOP 100 Sanxiang Private Enterprise 2025

* For the list of associations that LBX

Pharmacy has joined see the

"Social-Innovation-driven" section.Contents ESG Performance Highlights 2025 Environmental Social and Governance Report 07

ESG Performance Highlights

Governance Social

Operating income of

Rated A in annual information disclosure work The coverage ratio of quality training among the employees

RMB22.237 wasThe total cash dividends in 2025 (including interim 100%

dividends) were estimated to be RMB 3 1 1 million 0 major quality and safety incidents related to goods and

billion

services

The coverage ratio of anti-commercial bribery and anti-

corruption training among the employees was 1 00% Customer satisfaction degree at 400 Hotline was 99.7%

0 major information security incidents Annually reviewed 2 0 8 3 suppliers

Net profit attributable

to the parent company The coverage ratio of the Transparent Cooperation

amounting to Commitment among the suppliers was100%

382 Environmental Annual R&D investments amounted to RMB 9 0 . 1 9 9 8 RMB million million

The consumption of renewable energies increased by 75% Female employees accounted for 9 0 . 0 2 % ; Females

on a year-on-year basis

accounted for 4 7 % of the middle and senior management

The total annual greenhouse gas emissions declined by 9 .28% The coverage ratio of training for all employees was 1 0 0 % ;

Tax payments of on a year-on-year basis

Annual average training hours were 181

895 The fresh water consumption dropped by 9 . 3 3 % on RMB million 0 relatively major and more serious safety incidentsa year-on-year basis

Annually invested in RMB 1 3 . 4 6 3 5 million in aggregate

The nationwide new energy vehicles for logistics

in charitable donations together with partners

delivery accounted for 69%Contents ESG Rating Performance 2025 Environmental Social and Governance Report 08

ESG Rating Performance*

LSEG ESG S&P Global CSA

61points 21points

Wind ESG CSI ESG

A BBB

SynTao Green Finance CCXGFI

B+ AA-

The case of LBX Pharmacy Consolidating ESG

LBX Pharmacy's ESG case was evaluated as "Typical

Management and Protecting Ordinary People's Health

Cases of Corporate Social Responsibility in Hunan

was included in the Annual Report on the Development of

Province in 2025"

China's Pharmaceutical Retail (2025)

China Association of Pharmaceutical Commerce Hunan Federation of Enterprises and Industrial Economy

* Performance rating in 2025 (as of December 31 2025)Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 09

01 Sustainability Management

Persistently upholding "doing everything for ordinary

people" LBX Pharmacy integrates the ESG concept into its

operations in an all-round manner continuously improves

its ESG system actively responds to stakeholder demands

and expectations makes unremitting efforts to improve its

sustainable development capabilities and business

resilience and creates long-term value.Contents of This Section

ESG Governance

Management Strategy

Stakeholder Communication

Assessment of Materiality IssuesContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 10

ESG Governance Management Strategy Stakeholder Communication Assessment of Materiality Issues

ESG Governance

Governance Structure

Reporting and

Level ESG subject Component ESG responsibilities

LBX Pharmacy has integrated its ESG concept into the entire supervision

value chain of its operations established a three-level ESG

structure at three levels i.e. "decision-making - management -

execution" clarified the responsibilities of all these levels Lead decide on and supervise major issues Board of Members of the At least once

related to the sustainable development of the

constantly reviewed sustainable development practices and Directors Board of Directors a year

Group and review annual ESG reports.ensured the deep integration of business decisions and

sustainability concepts.As the top ESG management body the Board of Directors of the Study the Group's long-term development

Company authorizes the Strategy and ESG Committee to strategies major investment decisions ESG

perform its governance functions according to the Rules of Chairman Xie Zilong strategies vision goals and policies etc.; Strategy and

Director Zheng Jiaqi monitor the achievement of the Company's ESG

Procedure for the Strategy and ESG Committee of the Board of ESG Committee At least once

Independent Director objectives and the effectiveness of measures for

Directors of LBX Pharmacy Chain Joint Stock Company a year

Wu Lianfeng achieving the objectives; deliberate over the

(hereinafter referred to as the "Rules of Procedure") and be

annual ESG reports.fully responsible for the research analysis and consideration

of ESG-related matters of the Company. To promote the

implementation of sustainable development strategy and

policy we have established an ESG Management Committee Formulate specific ESG management objectives

including senior management. Meanwhile an ESG Working indicators and initiatives based on the ESG

Group covering different functional departments and Composed of the management strategies; coordinate and

ESG Management At least once

s u b s i d i a r i e s ha s b e e n b u i l t t o j o i n t ly p rom o t e t h e Company's senior promote implementation of ESG projects;

Committee a year

implementation of various specific ESG actions and measures management perform regular evaluations and report to the

and continuously improve our ESG performance. The Securities decision-making; and constantly improve and

Affairs Department of the Company is responsible for facilitate improvement of ESG performance.coordinating the preparation of annual ESG reports and

controll ing the quality and continuity of information

disclosure. The Securities Affairs

Department and the Divide labor by functions; execute and handle

heads of functional ESG-related matters including assessment of

ESG Working

departments and material issues daily communications with

Group Daily irregular

subsidiaries as well stakeholders implementation of specific ESG

as business projects and participation in the preparation of

personnel ESG annual reports etc.Decision-making Management ExecutionContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 11

ESG Governance Management Strategy Stakeholder Communication Assessment of Materiality Issues

Information Reporting and Supervision Mechanism ESG Performance and Compensation

The Company has established a top-down ESG supervision mechanism. The Board of Directors is responsible for The Company establishes performance indicators for important ESG

supervising different ESG governance work including risk review strategy and goal formulation especially the Strategy issues including but not limited to governance commodity and quality

and ESG Committee and the ESG Management Committee. The ESG Management Committee is responsible for daily management customer services supply chain safety employees

overseeing the ESG Working Group. information security etc. and links these ESG performance indicators

with the performance pay and evaluation of relevant officers and

According to the Company's internal ESG information reporting

business leaders. In the future we will continue to optimize relevant

mechanism reports shall be made from bottom to top and level by level.systems according to the actual situation improve key performance

The ESG Working Group reports ESG practices to the ESG Management Board of Directors

assessment of ESG and further promote the deep integration of ESG

Committee from time to time. The ESG Management Committee reports the

governance into our strategic operations.progress of ESG actions to the Strategy and ESG Committee and the Board

of Directors through irregular work communications. The Strategy and ESG

Strategy and ESG Committee

Committee holds regular meetings to review and examine ESG policies

assessment of materiality issues achievement of goals and other

important ESG matters. The Board of Directors of the Company deliberates

over the achievement of ESG objectives and the annual report at its annual ESG Management Committee Learning and Communication on ESG

meeting.The Company publicly and transparently reports the overall ESG situation The Company attaches great importance to learning of ESG policies and

and progress to stakeholders by issuing annual ESG reports. Based on the

ESG Working Group improvement of management capabilities. In 2025 our officers and ESG

updates of regulatory policies we continuously standardize our criteria for execution team members actively participated in 5 special ESG training

report disclosure and improve information disclosure. sessions of the SSE and ESG themed activities organized by external

stakeholders. The Company engaged professional third-party

organizations for internal ESG policy analysis and training. Members of

the ESG Working Group communicated with the heads of functional

departments and subsidiaries about the latest policy requirements for

ESG ESG progress and outstanding ESG cases at least every six months

in order to continuously enhance the Company's internal awareness of

ESG and professional skills.The case of LBX Pharmacy Consolidating ESG

Management and Protecting Ordinary People's

Health was included in the Annual Report on the

Development of China's Pharmaceutical

Retail (2025)

The Company attaches great importance to the stakeholder demands

actively participates in ESG research and exchange activities of industry

associations and related organizations and joins hands with

stakeholders to promote the development in ESG in the industry. The

Company values the ESG rating of professional organizations pays

attention to more than 20 ESG rating systems at home and abroad

actively obtains the underlying data of rating agencies and

continuously improves ESG management and information disclosure.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 12

ESG Governance Management Strategy Stakeholder Communication Assessment of Materiality Issues

Management Strategy

ESG ConceptLBX Pharmacy consistently remains accountable for corporate citizens. Around the concept of "Everything for the People" creating a bright future together” we are committed to protecting health of the masses through widely

accessible health services and strict product quality control. We practise environmental friendliness and social responsibilities through green operation and community welfare. Through responsible compliance operations and

win-win development with our employees customers and partners we will build a healthy ecosystem for sustainable development and continue to make solid contributions to the development of a healthy China and the

joint construction of a better society.Sustainable Development Goals (SDGs) and Responses

We actively benchmark against the United Nations Sustainable Development Goals (UN SDGs) and constantly improve our ESG management strategies to create far-reaching social value while ensuring the steady

development of our business and join hands with all stakeholders to move towards a sustainable future.Category Issues involved Our objectives and actions Responses to the SDGs

Create a sound and effective governance structure to Earnestly fulfill the information disclosure obligation and

continuously improve corporate governance carry out diversified and positive interactions with investors

Corporate governance Formulate and implement the "Corporate Value and ReturnEnhancement Action Plan" and the "Shareholder Return Plan”

Establish and improve the risk and internal control systems Perform corporate governance according to law protect

Compliance operation and conduct internal and external audits on a regular basis intellectual property and pay taxes according to law

Strengthen business ethics and compliance management with Continuously improve the investigation and reporting

zero tolerance for corruption malpractice fraud and bribery mechanism and respond to 100% whistleblowing

Anti-commercial bribery

and anti-corruption Have anti-commercial bribery and anti-corruption training

Governance cover 100% employees

Anti-unfair competition Fight against unfair competitions and safeguard orderliness of the market economy

Optimize the information security management system Annually conduct third-party information security audits

Information security and

Strengthen publicity and training on information security and have major systems pass the third-level protection

customer privacy protection awareness have information security training cover 100% Establish a privacy protection mechanism

employees

Continuously promote the construction of the Group's quality Continuously promote the construction of a medicare

Product safety and quality control system compliance system

Create a nationwide offline and online network to continuously Standardize service standards provide professional

meet customers' diversified health service needs pharmaceutical services chronic disease management

Implement responsible marketing standardize the review services convenience services silver-hair services etc. and

Social mechanism for advertising and marketing and safeguarddiversify services to create a “Health station" around customersHealth service consumer rights and interests Improve the working mechanism for handling customer

complaints. The National Customer Service Center with hotline

prefixed by 400 will continue to listen to customers' voices and

conduct customer satisfaction surveysContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 13

ESG Governance Management Strategy Stakeholder Communication Assessment of Materiality Issues

Category Issues involved Our objectives and actions Responses to the SDGs

Standardize supplier onboarding evaluation and offboarding Regularly identify supply chain risks and response

Supply chain safety procedures and standards and improve supplier lifecycle measures to strengthen supply chain resilience

management

Innovation-driven Attach importance to R&D innovations and stabilize R&D Build an AI Strategy Committee to actively promote

investments corporate digital AI transformation

Develop franchises and alliances to empower small and Join in industry associations to provide advice and

medium-sized chains and single pharmacies suggestions and participate in the formulation of industry

Industry symbiosis and group standards to facilitate the healthy and positive

development of the industry

Equal treatment of small and

Create a fair competitive environment in terms of market opportunities resource allocation etc.medium-sized enterprises

Respect human rights protect the rights and interests of labor Improve the remuneration and welfare system carry out

Social workers and eliminate all forms of discrimination "altruistic" employee projects and improve employee

Perform compliant employment and recruit through diversified satisfaction

Employees channels to enrich the Company's talent reserve Value the power of women

Build a learning-oriented organization achieve coverage ratio of Protect the health and safety of employees improve site

100% in training for all employees and create smooth MTP management and conduct safety drills

career development channels and mechanism

Support farmers through industries entrepreneurship and Provide targeted support for the improvement of rural

employment in lower-tier markets under the open franchising medical and health conditions

Rural revitalization

model and sales of agricultural products through online e-

commerce

Set up "Love Stations" in tens of thousands of stores and care for Join hands with partners to regularly carry out public

Social contributions outdoor workers welfare activities such making donations to support

Provide rescue and care for groups suffering from natural education and caring for special and vulnerable groups

disasters.Strengthen the construction of an environmental management Dispose of wastewater waste gas and solid wastes in

system comprehensively identify environmental risks and reduce compliance with regulations to reduce the discharge of

Environmental the impacts of production and operation activities on the the wastes;

management environment Standardize the management of medical wastes and

recycle expired drugs

Use photovoltaic clean energies in parks and energy-saving Strengthen water conservation management and take

Use of energies and facilities at premises; implement various energy-saving and measures like rainwater recycling to increase water

consumption reduction measures to cut energy consumption resources utilization rate

resources

Use recyclable packages and recyclable logistics vehicles

in logistics to reduce carbon emissions

Environmental

Addressing climate

Carry out climate risk management; assess risks and opportunities; reduce greenhouse gas emissions

change

Build green warehouses; use new energies and distribute green Take measures such as environmentally friendly materials

power; build a green supply chain for store decoration; vigorously promote degradable

Green operation

Select green raw materials and adopt green processes for private plastic shopping and reduce environmental pollution

brands to practice green productionContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 14

ESG Governance Management Strategy Stakeholder Communication Assessment of Materiality Issues

Stakeholder Communication

LBX Pharmacy attaches great importance to its

Stakeholders Expectations and requirements Main communication channels

stakeholders continuously improves its efficient

and diversified communication mechanism to

Compliance operation Social Institutional research conferences Implementation of standard

enhance mutual understanding and trust and Government and

Tax payment according contributions Regulatory assessment operating procedures

actively l istens to and responds to the regulatory authorities to law Submission of official documents Information disclosureexpectations and demands of its stakeholders

and information

which are taken as important considerations for

optimizing its ESG management strategies and

practices. Shareholder equity Corporate Regular reports and announcements Investor research activities

Shareholders Return on investment (ROI) governance Shareholders' meeting Performance briefings

and investors

Information disclosure ESG management Roadshows and reverse roadshows Investor hotline email

website

Product quality and safety Protection of Store communication WeChat Mini Program of the

Medicinal accessibility customer privacy 400 customer service hotline Company

Customers

Protection of consumer Responsible Customer satisfaction survey Official website and other

rights and interests marketing official We Media platforms

of the Company

Talent recruitment and retention Employee representatives' meeting Internal complaint channels

Employees Laborers' rights and interests

and symposium Offline visit and condolence

Remuneration benefits and care International communication and Employees' cultural activities

Training and career development feedback platforms

Occupational health and safety Employee satisfaction survey

Responsible procurement Business tendering meetings seminars Eco partners summits

Suppliers and other

business partners Integrity and honesty Supplier evaluation and management Industry conferences and

Mutual benefit and win-win result Daily communications and visits events

Provision of jobs Recruitment activities

Communities and

Health services Health services and health education

the public

Community development and well-being Charitable activities

Climate change Daily communications and interviews

NGOs media and Company operations Official website and other official We Media platforms of the Company

related organizations Social contributions Regular reports and information disclosure

Environmental management Internal monitoring and evaluation

Natural environment Climate change External supervision and feedback

Energy management Green behaviorsContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 15

ESG Governance Management Strategy Stakeholder Communication Assessment of Materiality Issues

Assessment of Materiality Issues

Issue Assessment Methods

LBX Pharmacy continuously carries out annual assessment and analysis of ESG materiality issues. In accordance with the SSE Sustainability Reporting Guidelines we continuously review and sort out the list of issues taking

into account our industry our own business characteristics the concerns of stakeholders and the continuity of the report.This year based on the principle of "double materiality" we took into account the materiality of the issues to the economy society and environment and to the Company's financial affairs. The assessment results were

disclosed after in-depth discussion by the management of the Company and approval by the Board of Directors upon review. As the financial materiality assessment principles and methods were still in the exploration stage

our double materiality assessment for the year mainly focused on qualitative analysis combined with appropriate quantitative analysis when conditions permitted. In the future we will continue to optimize our assessment

procedures and methods so as to make the assessment results more scientific and reasonable.Issue Analysis Procedures

01 Identification of Materiality Issues 02 Stakeholder Communication

Based on the 21 issues under the SSE Sustainability Guidelines and taking into account factors such as macro Identify 8 major stakeholders based on their industry and

policies ESG standards requirements of rating agencies stakeholder demands characteristics of the business characteristics.pharmaceutical retail industry strategic development and actual operation of the Company we finally identified a Perform dual-track surveys anonymous online questionnaire

total of 24 ESG issues and preliminarily analyzed their related impacts risks and opportunities. In particular during surveys for all stakeholders on the Company's WeChat official

the reporting period the Company was not involved in scientific research and technology development activities in account one-on-one survey communications for internal officers

the sensitive ethics of science and technology so the "ethics of science and technology" was not identified. Four and key business leaders and fully take into account the

issues namely "corporate governance" "compliance operation" "industry symbiosis" and "Party building work" opinions of stakeholders on the impacts of the issues.were additionally identified.

03 Double Materiality Analysis and Sorting

We ranked the impact materiality and financial materiality of

Impact materiality：All stakeholders underwent an anonymous questionnaire survey scored based on the scale scope each issue on a scale of 1 to 5. The issues with a score below Average:＜2 points

irremediability and likelihood of occurrence. The ESG Working Group collected and analyzed the questionnaires which

were reviewed and confirmed by the Strategy and ESG Committee to form an impact materiality assessment. 2 points were generally material" those with a score of 2 to 3

points "moderately material" and those with a score of 4-5

Financial materiality：The risks and opportunities that might affect the Company's business operations financial Moderate: 2-3 pointspoints "material". The materiality threshold was set as 4

position operating results cash flow etc. were mainly judged by internal financial experts. A financial materiality points. Specifically an issue that was material (4-5 points)"

assessment was performed from the perspective of occurrence probability and extent of impacts of the issues. Finally

the issues were reviewed and unanimously confirmed by the financial officers the secretary to the Board of Directors was deemed to have material impacts (with impact Material: 4-5 points

and the Strategy and ESG Committee of the Company. materiality or financial materiality).

04 Confirmation and Response

The materiality assessment results on the issues were examined and approved by the Strategy and ESG Committee and the Board of Directors. Besides we incorporated the materiality assessment results into

our risk management process continuously reviewed the management mechanism for sustainability-related impacts risks and opportunities and responded to the concerns of all parties in a targeted manner

through the annual ESG report.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 16

ESG Governance Management Strategy Stakeholder Communication Assessment of Materiality Issues

Assessment Result

Financial materiality

Safety and quality of products

and services

Supply chain safety

Employees

Information security and

customer privacy protection

Equal treatment of small Stakeholder communication Corporate governance

and medium-sized Due diligence Compliance operation

enterprises Anti-unfair competition Anti-commercial bribery and

Addressing climate change Circular economy anti-corruption

Use of energies and resources Innovation-driven

The double materiality assessment results suggest that the safety and quality of products and

services supply chain safety employees information security and customer privacy protection

Social contributions corporate governance compliance operation anti-commercial bribery and anti-corruption

Pollutant emissions Rural revitalization Industry symbiosis innovation-driven and industry symbiosis are our most material ESG issues among which: the

Ecosystem and biodiversity Party building work safety and quality of products and services supply chain safety employees information security

protection Environmental compliance and customer privacy protection demonstrate double materiality. Our identification of relevant

management

Waste treatment impacts risks and opportunities on material issues is set out below. Details of our management

Usage of water resources and actions are shown in the sections on corresponding issues.Average Moderate Material

Impact materiality

Materiality Time Sections of Manage-Materiality Affected Stakeholders Impact Risks Opportunities

Issues Period * ment Measures

The quality and safety of drugs If products and services have By establishing high-standard

Customers and services is the lifeline of the safety or quality problems end-to-end quality control and

pharmaceutical retail industry. they might face risks such as continuously developing

Government and Strict drug quality control and regulatory penalties professional advantages of

regulatory authorities

Safety and professional pharmaceutical consumer disputes and offline retail pharmacies it is Social

Double Suppliers and other services are cornerstones for damage to brand reputation. helpful for enhancing consumer quality of

business partners enterprises to build consumer trust and loyalty attracting more Long-term Quality Control

products and materiality Health Services

Shareholders and trust. Besides they effectively potential customers and

services

investors improve the health of all people expanding market share.and promote the value

Employees enhancement of pharmacies and

Community and public the sustainable development of

the industry.Material Moderate AverageContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 17

ESG Governance Management Strategy Stakeholder Communication Assessment of Materiality Issues

Materiality Time Sections of Manage-Materiality Affected Stakeholders Impact Risks Opportunities

Issues Period * ment Measures

The supply chain is the core Any problems with suppliers' product Establish a strict supplier

business link of retail. A safe quality and compliance operation evaluation and selection

stable and efficient supply might bring about legal risks mechanism to select high-quality

Suppliers and other chain is the lifeline to assure reputational losses and supply chain suppliers that conform to ESG

business partners drug availability and quality. disruptions to the Company; standards and reduce risks; Social

Supply Chain Double Shareholders and It is directly related to health Long-termNatural disasters such as Strengthen the supply chain Supply Chain Safety

Safety materiality investors rights and interests of the earthquakes and floods might cause resilience; establish a more

Customers public as well as traffic disruption affect logistics and transparent supply chain system

emergency guarantee. transportation result delay in the and a diversified supplier matrix;

Besides it highly affects the supply chain which in turn affect the reduce the risk of disruption.stability of the Company's supply of store terminals.operations.In the service industry Violation of human rights and labor By building harmonious labor

employees act as bridges rights might bring about compliance relations it is helpful for enhancing

between enterprises and risks and affect corporate reputation the Company's cohesion and

market customers. The and image; centripetal force the employees'

professionalism and If the employee rights and interests sense of belonging and

service warmth of the are not protected or their responsibility thus promoting the

frontline employee team remuneration is lower than the Company's advancement with

directly affect the market equivalents the risk of resilience.experience of end

Employees employee turnover might be caused Continuously improve the Social

Double customers. The quality and it would become impossible to remuneration and welfare system; Medium-

Employees Community and stability and tenacity of the

materiality effectively introduce talents thus provide career development Employee public talent team will also affect termaffecting the Company's long-term opportunities; improve the working

the Company's operation Developmentstable development; environment and other measures

quality.Occupational health and safety to enhance employee satisfaction

incidents will have direct negative and loyalty;

impacts on the employees. Violation Advocate transmitting "altruistic

of relevant laws and regulations cultures" to enhance the

might lead to financial losses such as employees' sense of job identity

fines affecting reputation and and value and better serve

image. customers.Information technologies If the information system is attacked Attach importance to the

play important roles in by hackers employees operate in protection of personal data and

modern enterprises' violation of regulations or their user privacy improve the

operations. Potential data permissions are improperly network security management

Customers security and privacy configured it might lead to data system and operation

Information Governance

Employees protection will directly leakage significant compliance risk mechanism and enhance the

Security and Double affect prevention and and reputational loss thus causing trust with stakeholders. Information Security

Government and

Customer Short-termmateriality control of the Company's the crisis of trust;regulatory authorities Through certification and third- and Customer Privacy

Privacy operational risks and The disclosure of trade secrets will party audit continuously Protection

Shareholders and customer trust.Protection impose adverse impacts on the core consolidate the foundation for investors

competencies of the Company; information security.Corporate information security

construction would increase

financial costs.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 18

ESG Governance Management Strategy Stakeholder Communication Assessment of Materiality Issues

Materiality Time Sections of Manage-Materiality Affected Stakeholders Impact Risks Opportunities

Issues Period * ment Measures

Sound corporate Any great or more serious corporate Sound corporate governance

governance is the governance loopholes will affect the helps the Company prevent risks

cornerstone for Company's normal business improve the quality of the

guaranteeing strategic operations causing trust problems in Company's operations and

stability and compliance the capital market and even promote the sound development

Shareholders and operation. Timely and regulatory penalties; of the market;

Corporate Impact investors accurate information GovernancePoor investor relations management Positive investor relations

Governance materiality disclosure and positive Government and might lead to information asymmetry management might effectively

investor relations Long-term

Corporate

regulatory authorities and the Company's investment enhance the Company's trust and

communication safeguard Governanceattractiveness. As a result the recognition in the capital market

the rights and interests of Company's value will be and facilitate the Company's

shareholders and investors underestimated. market value management.stabilize market

expectations and build

corporate social credibility

and long-term value.Pharmaceutical retail is a Imperfect risk management A good compliance system might

heavily regulated industry might weaken the Company's overall help the Company capture more

where operating in ability to address risks resulting in business opportunities from the

compliance with laws and some negative impacts such as increasing industry concentration;

Shareholders and regulations and with financial losses legal issues and A sound risk management system

investors integrity is helpful for reputational risks. might effectively enhance the

Compliance Impact safeguarding the safety of Government and Company's development resilience

Governance

medical insurance funds Stricter industry regulation might Medium-

Operation materiality regulatory authorities

and consumers' increase the Company's compliance

under a risky environment.better Compliance

serve customers. term

Employees medication safety costs. In the event of any violation Operation

enhancing public trust the Company will face administrative Customers

particularly promoting the penalties and reputational risks.fair impartial and

transparent development

of the industry.strengthening prevention commercial bribery and corruption Establish an anti-commercial

and control of corruption are involved the Company or its bribery and corruption

risks it is helpful for employees might face the risk of management mechanism

effectively safeguarding legal proceedings resulting in covering the whole value chain;

corporate assets and financial risks serious damage to consolidate anti-commercial

Government and

operating results while the Company's brand image and bribery and anti-corruption

regulatory authorities

maintaining fair market reputation a crisis of investor and governance supervision and

Anti-commercial GovernanceShareholders and

Impact competition gaining customer trust and risk of loss. punishment; effectively

Bribery and investors regulatory trust and guarantee the Company's Anti-Commercial

materiality

Anti-corruption Employees building long-term market operating results;

Short-term

Bribery and

trust.Suppliers and other Continuously strengthen the Anti-Corruption

business partners publicity and education on the

"Nine-Redline" anti-corruption

culture; build a faithful and

impartial brand image and

enhance the trust in all parties.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 19

ESG Governance Management Strategy Stakeholder Communication Assessment of Materiality Issues

Materiality Time Sections of Manage-Materiality Affected Stakeholders Impact Risks Opportunities

Issues Period * ment Measures

The development of digital If the technological iteration is Through complete technology-

AI has profoundly affected untimely the Company's operations driven business upgrading the

all industries. Through the would be inefficient; Company optimizes its sales

transformation by digital AI Digital and intelligent transformation procurement and marketing

pharmacy retail has realized requires a certain amount of procedures empowers business

Shareholders and innovative applications in investment which will increase decision-making and effectively

Innovation- Impact investors the supply chain financial costs. improves its operations;

Social

driven materiality commodities marketing and Employees AI empowerment further "reduces Innovation-driven

health services which will Medium-burden and increases efficiency" of

Customers not only significantly termthe employees while effectively

Suppliers and other improve operational enhances customer experience

business partners efficiency but also and stickiness with the help of big

effectively drive the industry data and AI-based personalized

to upgrade from traditional health management.drug sales to a

comprehensive health

service platform to create

greater commercial and

social value.Healthy competition and Deterioration of relationships with By developing desirable business

experience sharing among business partners might lead to loss cooperation it helps improve the

peer pharmaceutical retail of cooperation opportunities; Company's business performance

enterprises especially the The operating risks of franchisees and and enhance the Company's

demonstration and alliances might affect the Company's influence in the industry;

empowerment of leading reputation and normal business Establish unified franchise and

Suppliers and other enterprises will help small Socialoperation; alliance business management

Industry Impact business partners and medium-sized chains

Increasingly tightened industry standards to improve the business Industry Symbiosis materiality Government and resist risks promote the

Medium-

overall standardized supervision might increase corporate

compliance of partners;

term Symbiosis

regulatory authorities compliance costs. Market continuously perform development of the industry empowerment and grow together

and ultimately benefit the competitions are intensified and

health of the grassroots operating costs of the Company

with partners.communities they serve. increase. Unite industry practitioners to

actively promote the formulation

of industry standards and the

linkage of the entire industry chain

to maintain the sound

development of the industry.* Combined with the industry in which the LBX is the Company's strategic planning and operation reality the short-term

medium-term and long-term are defined as follows: short-term (0-1 years); medium-term (1-5 years); long-term (more than 5 years).Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 20

02 Governance

LBX Pharmacy strictly abides by the laws regulations and

regulatory requirements of the locations where it conducts

business and related organizations. It continuously improves

its corporate governance optimizes its construction of a

comprehensive r isk management mechanism and

compliance system creates an honest clean and fair

business environment with stakeholders and shares its

sustainable development and operating results with its

shareholders and investors.Contents of This Section

Corporate Governance

Compliance Operation

Information Security and Customer Privacy Protection

Party Building WorkContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 21

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Corporate Governance

Governance

System Construction Governance Structure

In strict compliance with the Company Law the Securities Law the Rules The Company had general shareholders' meeting (which was changed as shareholders' meeting in December 2025) the Board of

Governing the Listing of Stocks on Shanghai Stock Exchange the Guidelines on Supervisors (which no longer existed in December 2025) the Board of Directors the chairman of the Board of Directors and the

the Bylaws of Listed Companies the Code of Corporate Governance for Listed president. Under the Board of Directors the Strategy and ESG Committee the Audit Committee and the Nomination Remuneration

Companies the Self-Regulatory Guidelines for Listed Companies on the and Evaluation Committee were set up.Shanghai Stock Exchange No. 1 - Standardized Operation (2023) other laws

and regulations as well as relevant guidelines the Company actively promotes

the optimization of its corporate governance structure establishes scientific and

effective mechanisms for division of responsibilities checks and balances and General shareholders'

guarantees its transparent and standardized operation. meetings

Board of Supervisors

The Company continuously improves its internal control system. During the Strategy and ESG

reporting period the Company updated and improved 27 internal governance- No longer existed from December 2025 Committee

related systems including the Articles of Association the Rules of Procedure for

Shareholders' Meetings the Rules of Procedure for the Board of Directors the

Secretary of the

Rules of Procedure for the Strategy and ESG Committees of the Board of Board of Directors Board of Directors Audit Committee

Directors the Rules of Procedure for the Audit Committee of the Board of

Directors the Rules of Procedure for the Nomination Remuneration and

Nomination

Evaluation Committee of the Board of Directors the Work System for

Remuneration and

Independent Directors and the Management Measures for Related Party Evaluation Committee

Transactions in accordance with the changes in relevant rules of the CSRC and Chairman

the exchanges.Inspection Risk Control and

Department Audit Department

27 President

internal governance systems updated and

improved in 2025

Business Cluster Supply Chain Cluster Service ClusterContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 22

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

General Shareholders' Meeting of the Company Board of Directors of the Company Board of Supervisors of the Company

The general shareholders' meeting of the Company enjoys the right to The Board of Directors of the Company is responsible for the The Board of Supervisors of the Company which is

make decisions as stipulated in the laws regulations and the Articles general shareholders' meeting. Except for the chairman other responsible to the general shareholders' meeting

of Association and exercises the right to make decisions on major directors do not hold the management positions (i.e. officers) in performs legal and compliant supervision over the

matters such as the Company's business policies financing the Company thus separating those charged with governance financial affairs major matters internal control directors

investment and profit distribution in accordance with the law. In strict and the management. In 2025 the Company held 6 Board of and other officers of the Company in accordance with

compliance with the provisions and requirements of the Articles of Directors meetings and deliberated over 36 resolutions with the laws and regulations so as to safeguard the interests of

Association and the Rules of Procedure for Shareholders' Meetings attendance rate of 100% among the members of the Board of the Company shareholders and employees. The fifth

the Company regulates the procedures for convening holding the Directors. Board of Supervisors of the Company consists of three

shareholders 'meetings and deliberation. At the shareholders' supervisors including one employee representative

The Board of Directors of the Company has established three

meetings on-site and online voting is combined. The votes of small supervisor. In 2025 the Company held three Board of professional committees namely the Strategy and ESG

and medium-sized investors for major matters are counted Supervisors meetings and deliberated over 19 Committee the Audit Committee and the Nomination

separately thus fully ensuring that all shareholders enjoy equal status resolutions with the attendance rate of 100% among the Remuneration and Appraisal Committee to provide advice and

and effectively safeguarding the interests of all shareholders members of the Board of Supervisors.recommendations for the Board's decision-making assist the

especially minority shareholders. In 2025 the Company held two Board of Directors in performing i ts supervision and In December 2025 in act ively response to the

general shareholders' meetings and deliberated over 16 resolutions. management duties and promote corporate governance. In requirements of the new Company Law and the

2025 the professional committees of the Board of Directors held Company no longer had the Board of Supervisors. The

11 meetings considered 29 resolutions and the attendance rate corresponding supervision and management powers of

of the members of the professional committees was 100%. the Board of Supervisors were exercised by the Audit

Committee of the Board of Directors.Management of the Company Annual Data 2025

The management of the Company which is responsible for the operations management of the Company organizes the implementation of

resolutions of the Board of Directors annual plans and investment plans of the Company formulates specific rules and regulations of the

Company and performs other functions and powers granted by the Articles of Association or the Board of Directors etc. to ensure the efficient

and stable development of the Company. In 2025 the Company had 8 statutory officers including 3 female officers accounting for 37.5%. 2 16

general shareholders' reviewed

meetings proposals

636

Board of Directors reviewed

meetings proposals

319

Board of Supervisors reviewed

meetings proposals

General shareholders' meeting 2024Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 23

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Management Measures

Construction of the Board of Directors

Independence of the Board of Directors Diversity and Professionalism of the Board of Directors

The Company attaches great importance to the independence of the operation of The Company strives to build a diverse and professional team of directors and pays attention to the diversity of the Board of

the Board of Directors the positions relationships and decision-making are Directors in terms of gender cultural and educational backgrounds professional skills and other aspects so as to ensure that the

independent. decision-making by the Board of Directors is scientific. The Company currently has 9 directors including 3 independent directors

and 1 female director. All members of the Board of Directors of the Company have rich professional backgrounds and diverse

professional skills covering pharmaceutical business financial investment accounting digitalization risk control management

Independence of Positions and other fields.The Board of Directors has a total of 9 members 7 of whom are external

directors (namely those who don't hold any positions other than

directors including independent directors and directors appointed by

shareholder units) who account for 77.78%. 9 3 1

directors of the Board independent directors female director

of Directors

Independence of Relationships

The Company's Working System for Independent Directors clarifies the

restrictions on shareholding appointment and major business dealings

of independent directors. The independent directors have no 9

relationships with the Company and its major shareholders that might Chairman United States Accountant Female

hinder them from making independent and objective judgments 8 61-70

Employee Risk management

including but not limited to relatives business relationships etc. to Hong Kong representative and internal

ensure that independent directors may objectively perform their duties. director China control

7

Digitalization

6

Independent Business

administration

Independence of Decision-making 5 directors

For voting of the Board of Directors one person shall cast one vote 男性

and resolutions made by the Board of Directors must be passed by a 4 Pharmaceutical

majority of all directors. commerce Male

41-50 China

When a director is related to a matter to be resolved such director 3

shall abstain from voting.The Company has 3 independent directors who express independent 2 Director Financial

opinions on major issues such as related-party transactions at the investments

general shareholders' meetings and the Board of Directors meetings. 1

Adhering to the principle of independence they give full play to their 31-40

roles in independent judgment and professional guidance to

0

safeguard the legitimate rights and interests of the Company and all

Title Specialty Gender

its shareholders. Age Nationality

Note: The above data shows the members of the Fifth Board of Directors who performed their duties in 2025.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 24

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Effectiveness of the Board of Directors Capital Market Responses

In strict compliance with the laws and regulations as well as the Compliance of Information Disclosure

provisions and requirements of the Articles of Association and the

Rules of Procedure for the Board of Directors of the Company the The Company actively fulfills its information disclosure obligations in strict accordance with the Rules Governing the Listing of Stocks on

Board of Directors of the Company diligently and actively performs its Shanghai Stock Exchange the Guidelines of Shanghai Stock Exchange for Self-Regulation of Listed Companies and other relevant regulations.duties implements the resolutions of the general shareholders' It truthfully accurately completely timely and fairly carries out information disclosure work standardizes information disclosure standards

meetings and discloses its annual Work Report which covers the and reporting procedures shows the Company's business philosophy and achievements to investors and effectively protects the legitimate

performance of duties by the Board of Directors and special rights and interests of investors.committees and the work priorities for the next year. Besides In 2025 the Company implemented and improved its Information Disclosure Management System clarified the responsible entities and

members of the Board of Directors of the Company actively participate reporting rules and set limits on amounts for warnings of matters that required cumulative calculations including external donations related

in on-site research on key projects and stores of the Company party transactions M&A so as to fundamentally improve the standardization and effectiveness of information disclosure management.effectively promoting the implementation of the Company's strategies.In 2025 the Company issued a total of 126 announcements and related documents and added a description of operations in its regular

The independent directors of the Company annually conduct self- report so that investors could truly understand its development through more standardized and transparent information disclosure. In order

assessment report and disclose the annual Independent Directors' to facilitate our investors' deeper understanding of the Company we posted "infographics" or videos in combination with our regular reports

Duty Performance Report which covers their meeting attendance and took the initiative to publish articles to comprehensively interpret our major announcements. Throughout the year mainstream media

time and content of on-site work etc. sources published about 1000 positive reports about the Company.Training of the Board of Directors

In 2025 the Company organized directors to attend four relevant

Rated A in information disclosure work from 2024 to 2025

training sessions organized by Shanghai Stock Exchange Hunan

Securities Regulatory Bureau and China Association for Public

Companies including "corporate governance and performance of

duties by directors supervisors and officers" "key points of

performance of duties and shareholding change management of

listed companies" "regulatory policy for information disclosure and Diverse Investor Communications

situation analysis" "typical cases of disciplinary punishments on The Company attaches great importance to communications with investors proactively carries out investor relations management and

directors supervisors and officers" and "typical cases of protects the legitimate rights and interests of institutional investors individual investors minority shareholders and potential investors such

administrative violations by directors supervisors and officers". as the right to know. In 2025 in order to promote its benign relationships with its investors as a listed company the Company revised and

improved the Administrative Measures for Investor Relations to clarify the service recipients principles purposes and methods of investor

relations management. In addition we continuously strengthened our communications with investors through multiple channels to help them

understand our situation more clearly and conveniently and carefully listened to their feedback and suggestions which in turn improved the

Company's daily operations.Engagement Channels

Performance Company Strategy Roadshow Collective Media SSE Email Phone

briefings research meeting for and reverse reception interviews E-interactive communica-

securities roadshow day for tions

firms investorsContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 25

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

In 2025 the Company conducted a total of 154 exchanges with Stable and Steady Returns for Investors

institutional investors covering 1154 institutional investors in total; 3 Practising the "investor-oriented" development philosophy the Company is committed to establishing a scientific sustainable and stable

performance briefings and 3 telephone conferences for interpreting dividend return mechanism and continuously implements the SSE's action plan for "improving quality increasing efficiency and emphasizing

our periodic reports. We replied to 42 questions from SSE E-interactive

returns" to actively reward shareholders. Since its listing in 2015 the Company has cumulatively distributed cash dividends of RMB 2.38 billion

with a response rate of 100% answered questions and cleared doubts

(including dividend proposal for 2025) which account for 236% of the net funds raised from the IPO.of the investors on the premise of complying with information

disclosure rules. The Company has formulated and actively implemented the Shareholder Return Plan for the Next Three Years (2024-2026). On the premise of

satisfying conditions it has increased the dividend distribution frequency. In 2025 it was the first time that the Company distributed interim

dividends of RMB 106 million for the third quarter. The Company's dividend proposal 2025 intended to distribute total cash dividends of RMB

205 million In 2025 the total dividends (including the dividend proposal 2025) amounted to RMB 311 million accounting for 81.48% of the net

profits attributed to the parent company in 2025.Cash Dividends and Dividend Yield of the Company after Its Listing

Cash Dividends（RMB 100 million）

4.50 Dividend Yield（%） 3.0%

4.003.86

In August 2025 the activity named "I am a shareholder" was carried out 2.5%

in LBX Pharmacy. 3.50

3.123.11

2.852.92

In August 2025 the Company took part in the activity named "I am a 3.00 2.0%

shareholder" guided by Shanghai Stock Exchange Hunan Securities

Regulatory Bureau and China Securities Investor Services Center and 2.50 2.24 1.5%

hosted by the Securities Association of Hunan Province together with 2.00

Chasing Securities a thematic activity for investors to walk into a listed 1.43

1.43

company. More than thirty small and medium-sized investors went 1.50 0.80 1.0%

into the head office of LBX Pharmacy and deeply understood the 1.230.80

Company's development strategies and operating results by field 1.00

0.5%

visits informal discussions and other forms. In September 2025 the 0.50

Company took part in the 2025 Collective Reception Day and Semi-

annual Results Briefing for Listed Companies in Hunan Province 0.00 0.0%

guided by the Office of the Financial Committee of Hunan Provincial 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Party Committee guided by Hunan Regulatory Bureau of China

Securities Regulatory Commission and hosted by Hunan Association

for Public Companies to deeply exchange with the investors and

Dividend yield = total dividend per share within the year/market price per share x 100% (The market price per share is the closing price on the

continuously establish friendly transparent active investor relations.last trading day)Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 26

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Compliance Operation

Risk and Internal Control Management

Risk Prevention and Control and Internal Control

With the goal of "nipping troubles in the bud" the Company actively promotes the construction of comprehensive risk management and internal control management systems. We have formulated and issued a series of

system documents such as the Yellow Paper on Comprehensive Risk Management the Work Charter on Comprehensive Risk Management the Group Risk Compliance Baseline Management Norms and the Internal Control

Manual established a four-tier risk prevention and control and internal control structure that clarified rights and responsibilities continuously improved the three lines of defense for risk management built a large

coordinated risk control system and created an internal control cycle mechanism and risk matrix covering the whole chain of operation and all business links including but not limited to social responsibilities development

strategies human resources organizational structure capital activities procurement business R&D etc.Risk Prevention and Control Internal Control and

Three Lines of Defense for Risk Management and Large Coordinated Risk Control System

Governance Architecture

As the final decision-making level for the

Board of Company's major risks it is ultimately Three lines of defense Coordinated and closed-loop

Directors responsible for the establishment

improvement and effective implementation of

the internal control system.Third line of

defense Supervision Audit

Supervision (Supervise process compliance) (Verify credibility of results)

Audit Supervise and evaluate internal and external layer

Committee audit work; review internal control

Supervise and certify the first two lines of defense

Management Decide on and guide daily risk management. Risk

Second line Process Quality Legal affairs Risk control

(architectural input (Formulate (Obey (risk control

of defense

process efficiency quality legal/compliance design hub)

Support layer . . .and compliance) standards) redlines)

The risk management team has built three Perform professional risk management

major lines of defense for risk management formulate standards and support empowerment

responsible for the construction and daily

operation of the comprehensive risk

Risk and management system. The internal control team

internal control organizes and implements daily internal Feedback/

management control inspection and internal control self- First line of Business execution demand

evaluation to ensure the effectiveness of defense Business management departmentorganization Business layer departmentinternal control. The Internal Control Team Monitoring and

preliminary

organizes inspection and self-evaluation of

evaluation results

daily internal control to guarantee the

effectiveness of the internal control. Directly bear and control risks

Evaluate healthiness

Supervise executionContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 27

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Risk Management Initiatives

As at the end of the reporting period the Company had prepared a risk compliance bottom-line checklist covering 11 major business

segments and continuously widened the business coverage of risk compliance management. We created a risk matrix and established

assessment standards for risk levels based on the internal control cycle system positioned specific risk points in all business links based on 19risk screening and evaluation items

the process architecture improved the risk assessment standards based on the process maturity and bettered the Company's overall risk

identification capability and efficiency.

2 risk management training sessions

Development strategies Human resources Corporate culture Financial reports

Annual Data 2025

Comprehensive budget Funding activities Quality management Organizational structure

5 core segments covered by the hierarchical risk report

M&A 11 risk compliance

Asset management Sales management investment management bottom-lines

24 internal control cycles covered by the risk matrix

In addition the Company has built a risk management database and carried out the collection summary and special reporting of risk

information on a regular basis thus providing effective support for the optimization of its operations management. We make full use of our Data as of the end of 2025

historical risk data for review and analysis to dig deep into potential common risk issues in business growth and promote the coordinated

governance of risk issues.In 2025 the Company conducted two special risk management training sessions continuously strengthened all employees' awareness of risk

prevention and control and professional capabilities and promoted the integration of risk culture into its daily operations management.The Company continuously improved its risk management system for public opinions updated and released the Corporate Crisis

Management System for Public Opinions in 2025 established the "Crisis Management Responsibility System for Public Opinions

(Responsibility System for Top Leaders)" strengthened public opinion monitoring and warning effectively prevented and

responded to public opinion crises at all levels in accordance with the four-level public opinion handling mechanism and process

and safeguarded its reputation and public image.Site of the Risk Management Training in November 2025

Internal Control Initiatives

The department responsible for internal control of the Company annually updates and maintains the Company's internal control manual

organizes implementation of internal control self-evaluation and issues internal control evaluation reports to guarantee the effectiveness of

internal control improve operational efficiency and effectiveness of the Company and promote the Company's strategic goal for long-term

development. In addition the Company is subject to the supervision of external third-party organizations. The accounting firm annually

conducts independent audits on the effectiveness of the Company's internal control over its financial reporting and issues the Internal Control

Audit Report.CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 28

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Process Management

Annual Data 2025

In 2025 the Company initiated its transformation and reform. It integrated its organizational functions and

stimulated frontline motivation by "streamlining administration and delegating power". Based on the above

background during the reporting period it upheld "driving business through processes guaranteeing Improvement of process

compliance with systems and inspiring vitality through authorization" as its management concept. The approval efficiency by

Company continuously upgraded its processes systems and authorization systems enhanced its support 127

for business transformation and laid a solid foundation for its agile operation and sustainable

development.Continuously iterating its process management system construction the Company has released and 13.1%

constantly improved its internal system documents such as Group's Process Management Standards LBX new and amended systems

Process Framework Group's System Management Standards and Group's Process Operations Management

Measures. Based on the established 15 core value chain process frameworks we created and revised

systems to address business pain points and promote the coordination of systems processes and

authorization. Besides the whole process was optimized after refined analysis which significantly improved

the efficiency of process approval.

279

Business Empowerment

During the reporting period the Company focused on seven process Authority

optimization projects which effectively driven business model innovation new and optimized procedures

and operational efficiency improvement through process reconstruction optimization items

and digitalization and systematically strengthened the compliance of key

business areas through special process optimization.

722

core business segments

Organizational Empowerment covered

Based on the requirements for the Company's transformation and

reform the Company systematically sorted out and optimized the process optimization items

authorities of all business segments promoted the reasonable

delegation of approval authority effectively empowered frontline

business units and enhanced market responsiveness. In addition we

comprehensively publicized and implemented newly released and

revised important systems and processes and continuously created a 7

cultural atmosphere where all employees were aware of the procedures 100 % core levels

abided by the systems and emphasized compliance.coverage of training on new systems

and processesContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 29

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Compliance Management

Legal Governance

The Company attaches great importance to "legal governance" and abides by laws and regulations of the country and area where its business is conducted which is regarded by us as a cornerstone and code of conduct for

our operations. It actively safeguards legitimate rights and interests of its own and its stakeholders through legal means improves its legal risk prevention and control mechanism and strengthens its employees' legal

awareness. The Company has established and continuously optimized its legal risk prevention control and governance system strengthened pre-compliance assessment process risk warning and post-event review

measures for improving operations management with respect to major projects strategic decision-making structural adjustment and other aspects and realized closed-loop legal risk prevention and control.Contract Management Intellectual Property Protection

Sticking to the "contract-abiding and credit-honoring" principle the Company has continuously The Company actively respects and safeguards intellectual property. As of the end of the reporting

standardized its contract signing and performance procedures. In 2025 we updated 48 contract period the Company had owned 754 valid trademarks (with trademarks deployed in 10 overseas

templates on procurement sales lease franchising employment human resources etc. issued 2 regions) 159 copyrights (including 108 computer software copyrights) and 70 patents. In 2025 the

contract review standards involving procurement and leasing matters organized our relevant brand "LBX" was officially included in the list of key trademarks in Hunan Province. We continuously

employees to learn increased our employees' legal awareness during contract negotiations and safeguarded our intellectual property in accordance with the law cooperated with relevant

reduced the risk of contract disputes. In 2025 100% of the Company's contracts passed the legal departments to severely crack down on illegal activities in the fields of trademarks patents etc.review. and cleaned up business environment of the market.

482100%75415970

contract templates review standards issued contracts passed the valid trademarks copyrights patents

updated legal review

Annual Data 2025 Data as of the End of 2025

Tax Payment According to Law Legal Popularization

The Company firmly implements tax laws regulations and policies truthfully declares taxes pays The Company attaches great importance to the employee education and training on their

taxes on time continuously strengthens tax compliance control and makes its due contributions to compliance awareness. In 2025 it organized two legal knowledge training sessions regarding

social and economic development. In 2025 it paid taxes of RMB 895 million. contract signing and anti-fraud criminal compliance to enhance the employees' compliance

awareness and capabilities improve its compliance management and provide strong support for

The Company has always adhered to the tax management principle of complying with tax laws and

employees to settle their high-frequency legal problems and risks encountered in their daily lives.strengthening control prudently reviewed the terms of business contracts and strictly controlled tax

treatment to ensure the compliance and accuracy of tax accounting and declaration. We actively In 2025 as the "Grassroots Legislative Contact

monitor the changes in national tax regulations and policies evaluate and analyze their impacts on Point" awarded by the Justice Department of

our business formulate response measures in a timely manner and actively conduct standardized Hunan Province the Company extensively

tax management. For major tax matters advice from external professional agencies is duly collected legislative opinions and suggestions

introduced. We discuss plans with internal expert panels and make prudent tax decisions. from the grassroots formed seven written

amendment suggestions for key areas such as

Besides the Company attaches great importance data management statistical supervision

to its digital financial and tax management platform anti-monopoly and open economy

actively constructs and updates its financial and and strove to build a three-dimensional opinion

tax digitalization systems strengthens the control RMB895 million collection network system (for instance adding

over VAT invoices through the tax system prevents feedback channels using digital tools such as

invoice management risks and builds a fair smart dual screens in stores) to give full play to

healthy and orderly tax ecology through concerted taxes paid in 2025 the role of grassroots legislative contact points

efforts under the rule of law. as channels for expressing public opinions. Site of Training on Procurement Risks in August 2025Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 30

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Medicare Compliance

The Company attaches great importance to medicare compliance management strictly obeys medicare-related laws regulations and policies of the state and different regions including the Regulation on the Supervision

and Administration of the Use of Healthcare Security Funds and the Interim Measures for the Administration of Medical Security in Retail Pharmacies continuously constructs and improves an all-round end-to-end medicare

insurance compliance management system to ensure that the whole process of medical insurance operations is compliant and controllable and guarantee the safety of medicare funds.Medicare Compliance Management System Medicare Compliance Training

The Company has built a medicare compliance management structure at three levels - "coordination by In order to enhance all employees' awareness of and professional competence for medicare compliance the

headquarters-supervision by theaters-execution by stores" forming a full-level end-to-end compliance Company has established a hierarchical and classified medicare compliance training system to carry out

control network. The medicare compliance management system aims at "traceability of the whole targeted training for personnel at varying levels and in different positions. The training has covered interpretation

process warning of all risks and full coverage of all personnel". It covers five core modules: system of the medicare policy medicare case studies medicare service practice upload specifications for traceability

construction process standardization digital control training self-examination and rectification to codes etc.ensure that the whole link of medicare operation meets the requirements of medical insurance policies.

9250

Group

training sessions of the training sessions of subsidiaries

headquarters

Mainly for employees of all business lines Mainly for frontline medicare service

of the headquarters 9 online and offline personnel such as business distr ict

training sessions were conducted in 2025 managers store managers and licensed

to enhance the headquarters employees' pharmacists a total of about 250 training

Rectification tracking

understanding and master y of the sessions were held in 2025 to enhance

medicare policy. frontline employees practical skill in

Theaters Experience sharing Stores m e d i c a re s e r v i c e s a n d e n s u re t h e

compliance in the whole process of front-

line medicare services.Medicare Compliance Management System

Medicare Compliance System Medicare Compliance Self-inspection

In 2025 the Company actively responded to the decision-making and deployment of National The Company internally carries out special inspection campaigns with "full coverage and deep penetration" for

Healthcare Security Administration on "comprehensively establishing a drug traceability mechanism medicare compliance self-inspections. The inspections cover 14 core modules such as medicare settlement

and strictly supervising medicare funds" revised and issued the Group's Medicare Management System specifications prescription review and retention drug purchase sales and inventory consistency and traceability

focused on improving the relevant content of traceability code management clarified the division of code collection. In 2025 a total of 10835 medicare self-inspections in self-operated stores were performed.responsibilities for traceability code management standardized system maintenance and development

requirements strengthened the standards for code scanning in stores explicitly prohibited relevant

violations and further consolidated the foundation for compliance management of drug traceability.Vertical gu

D ia dt aa n s ch earing

ng

ito

ri

on n

art

m

ati

o

Sm for

m

ct

in

e ing

Dir ort

repContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 31

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Empowering Medicare Compliance with Digital Intelligence

In 2025 the Company comprehensively promoted the construction of a medicare compliance system and code platform system and constructed a digital control system for "collection of all codes-medicare verification-risk

warning" to achieve accurate identification and efficient handling of medicare compliance risks.Medicare Compliance System Code Platform System

The Company has built its own medicare To improve the management of drug traceability codes in June 2025 the Company built its own

compl iance sys tem to consol idate the online code platform system covering all stores of the Group (including franchise and new retail

f o u n d a t i o n f o r m e d i c a r e c o m p l i a n c e stores). Relying on the code platform system it constructed a drug lifecycle traceability system 100%

operations. The system contains knowledge with "one code for one item" and established a closed loop of digital traceability in the whole

bases for medicare and medical rules etc. process from drug warehousing to terminal consumption thus making "sources traceable

performs real-time medicare compliance destinations searchable and responsibilities accountable". It effectively prevented and controlled coverage of stores (including

verification on store orders and automatically drug return wash sales repeated sales serial coding and other acts. On the other hand through

intercepts i l legal orders placed beyond functional integration the system combines the functions for collecting cashier scanning and

franchise and new retail stores)

medical insurance traceability codes reducing the employees' repeated operations easing the in the code platform system

quantity gender age restrictive conditions

burden and increasing the efficiency for frontline operations.and indications and those involving repeated Data as of the end of 2025

medication etc.Scan the code for accessing Scan the store code for Scan the online store code and Scan the store code for sales

the warehouse acceptance inspection reverse offline sorting code

position opening dispensing

profits losses etc.Code platform

Data upload

service capability output

Local medicare drug supervision and municipal All three-party traceability platforms

supervision bureaus Data storage

data download

Transpor-

tationContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 32

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Practising of Business Ethics

Adherence to business ethics is the foundation for the Company's long-term development and the code of conduct for all acts of the Company. Consistently adhering to the principle of good faith fairness and integrity LBX

Pharmacy builds trust with the market and the consumers in reliance upon good business ethics.Anti-unfair Competition and Anti-commercial Bribery and Anti-corruption

Anti-monopoly The Company strictly abides by all applicable anti-commercial bribery laws and regulations in its place of business and prohibits bribery and corruption that is

intended to acquire or retain business or obtain any other illegitimate benefits. According to the Charter of Corporate Supervision and Audit the Group's Supervision

Attaching great importance to the construction of

Department and Risk Control and Audit Department independently carry out internal audit and supervision work establish mechanisms for whistleblowing

compliance in anti-unfair competition and anti-

investigation special spot checks off-office audit management confidentiality management etc. and embed pre-control nodes in key processes such as

monopoly fields the Company is committed to

procurement and business information confidentiality exercise internal supervision power and give full play to their roles in promoting and guaranteeing internal

m a i n t a i n i n g a f a i r a n d h o n e s t m a r k e t

supervision and audit in strengthening internal control improving the operations management and increasing economic benefits. When performing their duties

environment and protecting the legitimate rights

they carry out their work under the direct lead of the chairman and his authorized agents to guarantee independence of business.and interests of consumers. We strictly abide by

the Anti-Unfair Competition Law of the People's The Company makes unremitting efforts to deeply promote its integrity and anti-commercial corruption work from the perspective of system construction spot audit

Republic of China the Anti-Monopoly Law of the checks cultural construction impacts on the value chain etc.People's Republic of China the Administrative

Measures for Combating Unfair Competitions

other relevant laws and regulations. We stick to

System Construction

the principle of fair competition opposing all acts

of unfair competition monopoly or commercial The Company has formulated the Integrity Management System and the Nine Redlines of LBX Pharmacy to strictly urge all employees to be honest and self-

disciplined and eliminate corruption. We have formulated the Management System for the Group's Blacklisted Suppliers was newly issued to standardize

bribery.the management of blacklisted suppliers and related personnel emphasizing compliance and transparency in the process of cooperating with the

The Company has formulated the Administrative suppliers. The Company has established an Employee Reward and Punishment System and Implementation Rules of Nine Redlines for All Employees to

Measures for Combating Unfair Competitions the punish the internal employees involved according to its internal rules.Administrative Measures for "Trust and Integrity

Enterprise Alliance" and other management "Nine Redlines" of LBX Pharmacy

s y s t e m s a n d i m p l e m e n t e d t h e s y s t e m

requirements in the details of our operations

1 Commit any manual cashier behaviors that violate the rules.

management including commercial publicity

customer relations tendering bidding and

2 Sell commodities not delivered by the Company in the stores.

intellectual property protection.In terms of value chain the Company reflects the 3 Misappropriate business revenues reserves and other revenues and privately set up small treasuries."anti-unfair competition clauses" in the contract

terms signed with suppliers lists the 24-hour Commit frauds including inflated performance non-firm offer of cash non-firm offer of inventories false accounting and other kinds of 4

fraudulent acts including but not limited to false promotions for obtaining fees and obtaining rewards by false means.whist leblowing hot l ine and includes this

"prohibited item" in the Nine Redlines of LBX

5 Commit any acts involving briber acceptance including accepting gifts from manufacturers agents and organizations with business dealings.

Pharmacy. We actively maintain the orderliness of

m a r ke t c o m p e t i t i o n s e n c o u ra g e h e a l t hy

6 Personnel at varying levels privately reach sales agreements with suppliers or agree on incentive policies and related fees etc.

competitions among enterprises and help create

a clean and healthy industry development 7 Illegally misappropriate the access to information not in one's own position and operate without permission.environment. In 2025 the Company did not

commit any acts that harmed the legitimate rights 8 Divulge data plans reports and other confidential documents of the Company.and interests of other operators or disrupted the

social and economic order. 9 Including but not limited to all other acts that infringe on the interests of the Company as set out in the above 8 paragraphs.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 33

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Whistleblowing Investigation System

Spot Audit Checks We encourage our employees and stakeholders to report any misconducts

In 2025 the Group's Inspection Department and Risk Control and Audit Department conducted 139 inspections and audits and that violate business ethics laws or regulations. While keeping the

reported 42 violations of regulations and disciplines according to the annual supervision and audit plan. Besides the Company whistleblowers' personal information confidential we strictly crack down

conducted all-round inspections of its stores through irregular random inspections monthly special regional random inspections on any retaliation and actively maintain open reporting channels. In 2025

store monitoring and supervision and big data analysis. The supervisions and audits covered 100% direct-sale stores. we effectively handled 100% reported matters.The Company actively participated in the "Trust and Integrity Enterprise Alliance" (the first autonomous industry anti-corruption

organization for Chinese Internet companies) and promptly uploaded the blacklist of illegal employees to the database of the "Trust

and Integrity Enterprise Alliance" as required by the alliance. In 2025 the Company additionally blacklisted 2 persons. Whistleblowing Method

No restriction is imposed on whistleblowing and complaining.Complainants may whistleblow/complain by telephone business

Cultural Construction WeChat email letter and face to face entrust others to

whistleblow/complain.During the reporting period the Company continuously publicized integrity and carried out the seventh "Nine-Redline Day" activities

in September 2025 covering all of its employees. The activities included online taking of a program known as "Keeping Redlines in

Mind and Acting in Compliance" by all employees signing the "Commitment Letter of Never Violating the Nine Redlines" setting the Whistleblowing Email

99 Redline Day computer desktop and the poster for opening APP "Bai Xing Tong". In addition in 2025 the Company organized 1

online integrity education program on "Keeping Redlines in Mind and Acting in Compliance" and published 4 WeChat tweets jtdcb@lbxdrugs.com

advocating integrity.Whistleblowing Hotline

13975122000

Impacts on the Value Chain

In terms of the value chain the Company requires all suppliers and partners who have formally contracted with it to sign the Trust

and Integrity Commitment which clarifies the business code of conduct supplier management requirements and its internal control Internal Whistleblowing

mechanism. It also guarantees the applicability and validity of the Trust and Integrity Commitment through internal audit and regular

LBX Pharmacy Business WeChat Bench - Joint Integrity Construction -

updates.Whistleblowing and Complaint

Visit and Correspondence Address

Annual Data 2025 Supervision Department 15/F LBX Pharmacy Group Building 808

Qingzhuhu Road Kaifu District Changsha Hunan Province 410005

139 42 100 Our Commitments%

The Supervision Department of LBX Pharmacy undertakes to reply to

inspections and audits notified violations of regulations direct-sale stores covered by a w h i s t l e b l o w e r / c o m p l a i n a n t r e g a r d i n g w h e t h e r h i s

conducted and disciplines the inspections and audits report/complaint is accepted within 3 business days (for information

collection preliminary verification and supplementation of relevant

evidences) after receiving a real-name report/complaint. To reject

the report/complaint an explanation will be given to the

100 1 w h i s t l e b l o w e r / c o m p l a i n a n t o n t h e r e a s o n . F o r a n y % report/complainant not within the jurisdiction inform the competent

department or unit and reply to the whistleblower/complainant. If

employees covered by the "Nine-Redline Day" thematic program on "Keeping Redlines

the content whistleblown is true the whistleblower will be given a

activities in Mind and Acting in Compliance"

cash reward.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 34

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Information Security and Customer Privacy Protection

Governance

Governance Structure

Decision-Making: Strategic Leadership and Overall Decision-making

The Information Security Committee which is responsible for decision-making is composed of the chairman the

president and relevant officers. As the highest level responsible for data security and customer privacy protection of the

Information Security Committee Company the Information Security Committee performs core responsibilities such as establishing strategic objectives

Composed of the chairman the president and overall directions of the Company's information security management generally coordinating and making final

and relevant officers decisions for major information security incidents and providing solid strategic support and resource guarantee for

information security work.n-

Dec

isio

Mak

ing

Information Security Organization

Management: Plan Implementation and Progression Supervision

The Company has built an information

security team which is directly led by the The management is an information security organization directly led by the Chief Technology Officer (CTO) which

Chief Technology Officer (CTO) comprehensively coordinates the formulation of information security policies and medium-and long-term plans

entm supervises the implementation of various strategies and measures regularly reports the progress of work to the

ana

ge

M decision-making and ensures the effective linking between strategic objectives and the execution.All Employees

n

cut

io

xe Led by the Information Security Execution: Full Participation and Collaborative ImplementationE

Department all employees (including

The execution led by the Information Security Department carries out various risk investigations for information security

frontline employees) act in place

and privacy protection and resolves potential security hazards by combining technical prevention and control with

management and control. Furthermore all employees are the ultimate executors and the first line of defense for data

security and customer privacy protection. All of them are required to strictly abide by the information security

management system in their daily work and illegal operations are strictly prohibited.System Construction

LBX Pharmacy strictly abides by relevant laws and regulations such as the Data Security Law of the People's Republic of China the Cybersecurity Law of the People's Republic of China and the Personal Information Protection

Law of the People's Republic of China. Meanwhile it closely pays attention to the updates of relevant laws and regulations adjusts its corporate information security management strategy in a timely manner and ensures that

its corporate information security compliance system keeps pace with national regulatory requirements.Guided by national laws and regulations the Company has built an information security system covering the whole business process and formed a horizontal and vertical system control network. We have 7 core systems

including the Group's Data Security Management System the Group's Information Security Vulnerability Management System and the Group's Information System Security Emergency Response Management System which

clearly and respectively specify key links such as data lifecycle management security vulnerability investigation and repair and emergency response.In 2025 to further strengthen data security control the Company formulated more detailed data security standards for key links such as data display storage processing and transmission and issued end-to-end supervision

and management procedures. Through the deep integration of systems and procedures dynamic monitoring and risk prevention and control of the data application were realized throughout the process ensuring that all

data operations were well-documented and a strong information security defense line was built from the institutional level.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 35

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Risk Management

End-to-end Risk Monitoring Core Protective Measures Emergency Response System

In view that all business links of the Company including its operation In order to enhance its risk resiliency the The Company has established a standardized emergency response

procurement merchandising and sales are digitalized the Company has Company has deployed multi-level security system clarified components and responsibilities of emergency

established an information security risk monitoring mechanism covering all protection technologies and facilities: Firstly it response organizations drafted emergency response plans for different

procedures of the whole value chain to guarantee the cybersecurity and data has established a complete disaster recovery incident levels and clarified emergency response procedures division

security of all key business links. For the digital and intelligent applications and and backup system to back up core business of responsibilities and response time limits based on the Group's

systems developed by us we integrate risk prevention and control into our data and systems on an off-site and regular Information System Security Emergency Response Management

development application operation and offline in order to guarantee the safety basis so as to ensure that data and services System.and controllability of the whole lifecycle of relevant applications from R&D to are quickly restored in case of sudden failure

Meanwhile by regularly organizing emergency drills at all levels and

decommissioning. or disaster; Secondly it has deployed

simulating various emergency security incidents such as cyberattacks

cybersecurity protection equipment such as

By deploying a professional risk monitoring system we perform real-time and data leakage a response mechanism has been tested and

firewall intrusion detection system and anti-

monitoring and warning of potential risks such as cyberattacks data leakage optimized in practice. After the drills we have continuously improved

virus software and built a cybersecurity DiD

and system failures for early detection identification and disposal of risks. our emergency response plans and response procedures by

s y s t e m t o e ffe c t i v e l y re s i s t e x t e r n a l

Besides we regularly carry out comprehensive risk assessment investigate and summarizing the problems and shortcomings through review so as to

cyberat tacks; Th i rd ly i t has monthly

sort out risks in information systems business processes personnel operations ensure that when real safety incidents occur we can realize rapid

strengthened system security reinforcement

and other dimensions prepare risk lists such as vulnerability ledger emergency responses efficient disposal and rapid service recovery for the purpose

scan and repair security vulnerabilities to

incident handling list and component risk ledger and formulate targeted of minimizing the impacts of the incidents.block potential security hazards in time.prevention and control measures.Strategic and Management Information Security Management System

Initiatives NATIONAL LAWS AND REGULATIONS

Cybersecurity Measures for Hierarchical Data Security Personal Information

······

The Company has always placed information security Law Protection of Information Security Law Protection Law

and privacy protection at a strategic level. Adhering to

t h e c o r e p r i n c i p l e o f " p r e v e n t i o n f o r e m o s t

comprehensive governance end-to-end control and RISK IDENTIFICATION AND OPERATIONS MANAGEMENT

continuous optimization" we comprehensively identify ORGANIZATIONAL Vulnerability mana- Baseline safety Data security Emergency response

information security risks and potential data leakage gement system management practices management system management system

······ AUDIT IMPROVEMENT

GUARANTEE AND TRAINING

dangers that might arise in the course of our operations

Vulnerability Threat intelligence Data security Emergency

and constantly improve our information security Information operations operations management response ······

management capabilities by constructing a sound Security Internal audit

Management and risk discovery

management system technical defense line and

Committee

organizational structure.CONSTRUCTION OF A TECHNICAL CONSTRUCTION OF A TECHNICAL

Improvement of

Information CYBERSECURITY SYSTEM DATA SECURITY SYSTEM external audit and

Security

Internet exposure Classification

evaluation

Department Desensitization of Firewall management platform and grading sensitive information

Training mechanism

Collaborative Application firewall Vulnerability scanner Storage and trans- Privacy compliance for all employees

departments mission encryption declaration

Host protection

······

platform Minimal use ······Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 36

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Data Security and Customer Privacy Protection

Six Links of Data Security and

As pharmaceutical retailer we are well aware that privacy security is

Privacy Protection

deeply related to customer trust and one of the sustainability issues

that customers attach great importance to. Taking customer privacy 01 02

protection as a top priority of our business management we have

continuously optimized our privacy protection mechanism and taken a Data collection Data storage

series of measures to ensure that our customers' personal privacy is

protected. During the reporting period the Company was not When collecting users' personal information actively Manage the data collected by grading and

explain policies for protecting users' personal privacy by classification and match them with the disposal

punished by relevant authorities for violating laws and regulations

notifying privacy agreements permissions for the appropriate security levels

related to information security and privacy protection.When collecting users' personal information for the first Perform encrypted storage of highly sensitive

time the users' intentions are solicited through a pop-up data to avoid infringement on privacy due to data

window. Only after obtaining consent will the collection of leakage

information necessary for conducting business be

minimized

0403

Data use Data transmission

Internal use Strictly use asymmetric encryption algorithms to protect the data

Adopt the principle of authorization minimization to control access and operation permissions and establish a transmission process and prevent the middlemen from stealing

regular review mechanism to ensure that the authorization process is controllable valid data

Adopt desensitization techniques such as anonymization and de-identification to prevent the risk of privacy For data transmission interfaces restrict illegal access and illegal

leakage during display data collection through technical means such as whitelisting

authentication authorization and underlocking management

Sharing with the third parties

Assess according to actual business needs and minimize data

Strictly control the process of data sharing with partners including but not limited to entrusted processing transmission by types and volume

collaborative analysis etc.Conduct standardized assessment of partners' data security capabilities and enter into agreements on rights

and responsibilities with partners before sharing

Process externally provided data through strict desensitization techniques such as anonymization de-

identification and simulation to ensure the irreversibility and non-traceability of personal information

0506

Data destruction Violation handling

Users may cancel their accounts and membership accounts at any time according to their own For violations occurring during data application dependent upon the severity of the

wishes. Once such operations are initiated the Company will delete the corresponding personal incidents and according to the internal management systems corresponding measures

information storage records while clearing user permissions thus fully protecting users' rights such as warning punishment and dismissal will be taken against the employees who

and interests in privacy. violate the regulations.The Company destroys the expired data in strict compliance with the relevant provisions of the Resolutely investigate relevant responsibilities through judicial means for particularly

Data Security Law of the People's Republic of China and ensure that the destruction process is serious circumstances and suspected illegal crimes

irreversible through technical means.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 37

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Information Security Audit Mechanism Objectives and Indicators

To ensure effective implementation of the information security and privacy protection system and timely identify and solve In the future the Company will continue to promote its information security and

problems and omissions in the implementation of strategies and measures the Company has established a mechanism for privacy protection subject to higher standards and stricter requirements: Firstly

"internal review + external evaluation" to promote the continuous improvement of the governance system through internal based on our strategic planning and actual business needs we will further

and external collaboration. enhance the standardization and internationalization of our information security

governance system; Secondly we will continuously strengthen technology R&D

In terms of internal review the Company organizes the Information Security Department and the Risk Control Department to

introduce advanced technologies such as artificial intelligence and big data and

jointly carry out internal review from time to time covering various dimensions such as cybersecurity data security system

make risk monitoring prevention and control more intelligent; Thirdly we will

implementation and technical protection. Through internal review a list of problem rectification is prepared clarifying the

deepen our information security culture building enrich the content and form of

rectification responsibilities and time limits and closed-loop management is implemented. In 2025 the Company conducted

training and further improve the security literacy of all our employees; Fourthly we

three internal key special cybersecurity reviews and more than 60 special data security reviews.will continuously optimize our emergency response system and improve our ability

With respect to external review to ensure that the review results are objective and authoritative the Company invites third- to deal with complex security incidents.party authorities to conduct annual external information security reviews. Third-party organizations comprehensively evaluate

the Company's information security management system technical protection capabilities and compliance level using

professional evaluation methods and tools and put forward professional suggestions for improvement. The Company

attaches great importance to the results of external reviews and regards them as important basis for optimizing the

governance system so as to promote the continuous improvement of information security management. 0 0

major information security punishments by related

1 100 incident authorities for violations of % laws and regulations related

to information security and

information security audit compliance rate of data use privacy protection

by a third-party organization

Annual Data 2025 Achievements in 2025 Achievements in 2025

Information Security Culture Building

Based on the actual business needs continuously carried

The Company has attached great importance to information security culture building established a normalized training

mechanism regularly organized special trainings covering all employees and relevant external partners comprehensively out information security management system certification

strengthened relevant internal and external personnel's awareness of information security and effectively enhanced its to improve information security governance.practical capability of risk prevention. In 2025 the training covered several core modules such as emergency response

procedures anti-phishing skills privacy protection specifications security development standards and knowledge on anti-

As of 2025 the core application systems involving user data (CRM system

fraud.Power system (POS cashier system) of LBX Pharmacy LBX-Lingyun ERP

system and medicare platform management system) have all been

recognizedb yt hes tate.

3100%

Three-level hierarchical

information security training coverage ratio of information protection certification

sessions security training among all employees

2025年Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 38

Corporate Governance Compliance Operation Information Security and Customer Privacy Protection Party Building Work

Party Building Work

As the first private pharmacy in China's pharmaceutical retail Strengthen Ideological Construction Brand Building for Party

industry to set up a party organization LBX Pharmacy attaches great

importance to party building work writes it into the Articles of The Party Committee of the Group has always regarded ideological and political construction as Construction

Association procures Party Organization members to enter the a top priority insisted on taking in-depth study of Xi Jinping's Thought on Socialism with Chinese

Board of Directors and management through legal procedures Characteristics for a New Era as its primary political task continuously innovated its ideas and In combination with the characteristics of its own

guarantees party building work from institutional ideological and measures for ideological and political construction procured the Party's innovative theories to and the industry the Party Committee of LBX

organizational aspects actively explores non-public Party building be rooted in people's brains and hearts constantly improved its political position and gathered Pharmacy integrates brand building for Party

resolutely performs the main responsibility for comprehensively and strength for advancement. construction with health services and public

strictly governing the Party continuously promotes the integrated

welfare undertakings to create a characteristic

development of party building and its operation and transforms the During the reporting period the Company deepened its online and offline integrated learning

model by regarding a thematic Party day activity known as "One Class One Video and One brand model of "Party building + public welfare + political advantages of the Party into its competence.Practice per Month" as a key initiative. We normally distributed more than 2000 volumes of health" further polish the background of Party

In 2025 the Party Committee of LBX Pharmacy focused on creation theoretical readings such as the Compilation of Documents of the 20th National Congress of the building in a non-public enterprise and highlight its

of service-oriented innovative and learning-oriented organizations Communist Party of China and the Selected Readings of Xi Jinping's Works to the Party members. brand influence as a benchmark Party organization.thoroughly implemented the general requirements for Party building We made full use of the staircase library of our Party and Mass Service Center to provide Party In terms of public welfare activities in 2025 the

in the new era and the organizational line of the Party in the new members with rich and diverse learning materials and learning scenarios. We pushed learning Party Committee and all Party branches of the

era and promoted the deep integration of Party building work with materials online on a weekly basis carried out prize-winning competitions for learning quiz Company actively participated in public welfare

business growth and mutual promotion for joint development. The groups and encouraged Party members to study independently and learn for life. undertakings and carried out more than 120 public

Party Committee of LBX Pharmacy was awarded the title of "Non-

welfare activities for rural revitalization charitable

public Party Building Benchmark Party Organization 2025" by the

donation health science popularization etc.Corporate Committee of Changsha Jinxia Economic Development Thematic Activity Named "July 1 Celebration for the 104th Anniversary throughout the year. Among the key projects theZone of the Communist Party of China. of the Founding of the Communist Party of China” Party Committee of the Company donated medical

In July 2025 in order to warmly celebrate the materials to Fengning Hebei Province for the fifth

104th anniversary of the founding of the consecutive year. These materials were specially

Enhance Organization Communist Party of China and vigorously carry forward the great spirit of Party founding the used to enhance the medical capacity of 12 local

Party Committee of the Company made overall rural clinics and continuously support Fengning's

Construction arrangements and all Party branches under the "healthy village" construction. Baixingtang Party

Company made positive responses carefully Branch made persistent efforts to deepen the Party

planned and orderly carried out a series of

The Company continuously consolidates its organizational building and co-construction activity known as colorful activities with the theme of "July 1

foundation for Party building. As of the end of the reporting period Celebration for the 104th Anniversary of the "TCM Brainstorming" and carried out 105 public

all members of the Party Committee were officers of the Company Founding of the Communist Party of China". Party welfare activities on "Benevolent Free Medical

and all branch secretaries were middle and senior managers. We members from all over the country drew their Consultation Famous Doctors' Door-to-door Health

had 1 second-level Party Committee and 26 Party branches under strengths from the activities filled with a sense of Services" throughout the year benefiting 35000

ceremony and gathered their strong synergy

our jurisdiction 366 Party members directly managed by us and people.with our officers to start their own businesses.more than 800 mobile Party members. During the reporting period In terms of brand dissemination for Party building

the Company promoted the synchronous promotion and the Party Committee of the Company focused on

optimization of Party organization construction and corporate cultivating the Party affairs publicity platform

institutional establishment and added three demonstration sites for

grassroots Party building throughout the year. Collective Watching of the Film Known as Dead to Rights

known as "Par ty Bui ld ing e-Home" which

integrated Party member education news reports

To solemnly commemorate the 80th anniversary

The Company conscientiously implemented the Several Guidelines interactive communications Party affairs disclosure of the victory of the Chinese People's War of

on Political Life within the Party under the New Situation further Resistance against Japanese Aggression and the and other functions with special columns such as

improved the systems of democratic life meeting organizational life World Anti-Fascist War on August 18 the Party "Theme Education" "Dissemination of Excellent

meeting heart talk and democratic appraisal of Party members Committee of LBX Pharmacy organized a film Party Members' Deeds" and "Q&A on Party Affairs".formulated and issued Party building work plans guided all general Party class activity named "Memorizing the In 2025 different types of information were pushed

History with Lights and Shadows; Upholding

branches (branches) of the Party to carry out political activities for 42 times with cumulative pageviews of more Peace with Original Intentions" which guided all

within the Party in a standardized manner strictly carried out Party members to deeply remember history than 65000. These columns effectively reached

prescribed actions and encouraged innovative and self-selected cherish peace and create the future by watching Party members and employees widely spreading

actions and ensured that Party building work was well- the patriotic education film titled Dead to Rights. red positive energy.documented rule-based and orderly.Case CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 39

03 Social

LBX Pharmacy is committed to becoming a trusted health

management expert around community residents. We have

constructed a highly standard product quality and service

safety system consistently upheld being innovation-driven

and continuously promoted high-quality health accessibility.As a responsible corporate citizen the Company has actively

created an equal inclusive and healthy development

environment for employees supply chain partners and the

communities impetus for the sustainable development of its

own and the industry and built a beautiful home with all

stakeholders.Contents of This Section

Quality Control

Supply Chain Safety

Health Services

Innovation-driven

Employee Development

Responsible CitizensContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 40

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Quality Control

Following the quality policy of "quality first customer foremost" LBX Pharmacy has constructed a quality assurance system covering the whole chain of drug merchandising to effectively protect medication safety of the

public in reliance upon its sound governance structure clear strategic orientation systematic risk management and solid management measures

Governance

In order to achieve the quality management objectives of transparent

decision-making efficient execution and powerful supervision the Strategic Level -

Company has constructed a scientific and perfect quality management Quality Management

structure especially a quality management system at four levels:

Unify Group-level quality management system standards internal quality inspection standards Department of the Group

"Group - provincial subsidiaries - urban companies - stores" a sound

quality risk management and control standards and quality information feedback standards;

hierarchical organizational management system and a quality

achieve full coverage of the Group's quality audits.responsibility mechanism for all employees forming a full-link quality

control pattern with clear hierarchy definite rights and responsibilities

and implementation by all employees.As principal in charge of quality management of the Company the Management -

corporate legal person promotes the core work of strategic quality Quality Management

management planning major decision-making and risk prevention Departments of Provincial

Implement the Group's quality system standards; subdivide the specific

and control in a coordinated manner. As a special executive agency Subsidiaries

spot inspection procedures; train and supervise the implementation of

the Quality Management Department of the Group is fully responsible

quality work of urban companies and stores; conduct internal cross IPQC

for the daily operation of the quality management system. In reliance

as scheduled by the Group.upon the full-link management path covering four levels from the

Group's headquarters to stores it promotes the penetration and

effective performance of quality responsibilities. Each subsidiary has Process Level -

built a leading quality management group with the person in charge Quality Management of

of the subsidiary as the team leader who leads the implementation of More than 150 Urban

various work requirements for the Group's quality management. The Implement the quality management standards Companies

quality leaders of the subsidiaries who serve as executive team and requirements of provincial subsidiaries;

leaders are responsible for the drug quality management of the dynamically inspect and supervise stores'

subsidiaries. They can independently exercise their discretionary power quality work.for quality management to ensure that drug quality control is

authoritative and effective. Each urban company is staffed with full-

Execution -

time quality management personnel for dynamic inspection and

Quality Management of

supervision of store quality work. As the minimum execution units of

Approximately 15000

quality management the persons in charge of store quality are Group

Stores

specifically responsible for store quality management. They ensure

that the control requirements are implemented in place at terminals.Provincial Perform quality management; assure drug

Meanwhile the Company has established and improved a quality quality and public drug safety; provide

Subsidiaries

responsibility mechanism for all employees deeply embedded quality feedback on quality information and make

responsibilities into the core work scope of all departments and Urban continual improvements.posit ions clarified the quality performance standards and Companies

requirements for all positions and procured all employees to take

responsibilities and perform their duties so as to integrate quality Stores

responsibilities into all aspects of daily operations.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 41

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Upholding "customers first quality foremost" as its quality policy LBX Pharmacy always prioritizes drug quality and drug safety. We strictly abide by laws regulations and territorial regulatory policies including the Drug

Administration Law the Implementation Rules for the Drug Administration Law the Good Manufacturing Practice for Drugs and the Measures for the Quality Supervision and Administration of Pharmaceutical Trading and Use.We have formulated and efficiently implemented systems job responsibilities and operating procedures covering the whole process of quality management to give full play to the exemplary and leading roles of the Company

as a leading pharmaceutical retailer.In 2025 we revised our internal systems and operating procedures such as the Pharmaceutical Quality Acceptance Management System the Management System for Class II Psychotropic Drugs the Management System for

Compound Preparations Containing Special Drugs the Management System for Computer System Data Backup and Storage the Management System for Unqualified Drugs the Management System for Qualification Review of

Suppliers and Purchased Varieties the Management System for Supplier Review and Quality Review of Purchased Drugs the Management System for Entrusted Drug Storage and Transportation the Drug Risk Control System

the Management System for Seven Unified Aspects of Drug Retail Chains and the Management Procedures for Dispensing among Drug Stores to constantly improve quality.Besides for quality management personnel we have established the Personnel Training and Assessment Management System to continuously make personnel's quality management more self-motivated and further improve

our quality management business. The Company uses APP "Bai Xing Tong" to develop monthly training programs which cover laws regulations professional pharmaceutical knowledge and skills quality management

system job responsibilities operating procedures etc. We incorporate key quality indicators such as commodity quality pharmacotoxicity incidents expiration date management and compliance operation into our quarterly

and annual KPIs which are linked to salary performance. Major violations are handled in accordance with the Employee Reward and Punishment System to foster all employees' awareness of the quality and bottom line and

enhance teams' quality management capabilities.Risk Management

The Company has formulated the Internal Audit System of the Quality Management System and the Drug risk Control

System. We have established a fully closed-loop quality risk management system for "identification - assessment - Quality Audit in 2025

disposal - review" which integrates forward-looking prediction and retrospective analysis to systematically identify

scientifically assess and control quality risks at different levels. In the daily quality management work a standardized risk

classification model has been built. Risks are divided into high-frequency high risks high-frequency low risks and low-

frequency high risks in accordance with specific management standards prevention and disposal measures so as to

effectively avoid quality risks and ensure the safety of people's medication. In 2025 the Company did not have any major

quality and safety liability accidents related to goods and services. 46 21319 15782

In 2025 the Quality Department of the Group conducted quality audits on 46 provincial subsidiaries. Provincial provincial subsidiaries direct-sale stores franchised stores

subsidiaries and urban companies inspected 21319 frontline direct-sale stores and 15782 franchised stores and

controlled operational risks through quality supervision and audit at all levels to continuously improve the overall quality

management.Quality Management Risk Assessment Process

Risk assessment proposals and plans Risk review meeting Risk investigation and identification

The quality management departments of all subsidiaries Build a risk assessment team and organize an assessment Keep and maintain quality risk investigation and risk

take the lead in formulating annual risk investigation and meeting according to the approved assessment proposal. management records to identify major risks.assessment plans and specific proposals and convene

review meetings.Risk assessment report Risk prevention and corrective actions

Prepare an assessment report based on the review results Take preventive and corrective actions to reduce the risks to

which are reviewed and issued by the principal responsible an acceptable level.person for study and implementation.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 42

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Strategic and Management Initiatives

Adhering to highly standard quality and safety lifelines the Company has established a full-link quality management system covering supplier management end-to-end control over purchase sales and inventory as well as

prediction and disposal of quality risks in strict compliance with the Drug Administration Law the Good Manufacturing Practice for Drugs and the Measures for the Quality Supervision and Administration of Pharmaceutical

Trading and Use to make definite regulations available for compliance in terms of quality control.The Company makes unremitting efforts to strengthen the building of licensed pharmacist teams. We have built a high-quality professional talent echelon through systematic training assessment and incentive mechanisms.We deepen the management of safe medication provide professional pharmaceutical services such as medication guidance health consultation and adverse reaction monitoring for customers and realize the coordinated

development of quality safety and health services.The Company improves the closed-loop "full participation and full accountability" and subdivides the quality responsibilities of all departments and positions. We enhance all our employees' quality awareness through

regular training and assessment. We have actively organized a number of quality activities and cultivated the cultural atmosphere where "everyone values quality everyone creates quality everyone enjoys quality".Six Major Links of Quality Control Three Major Quality Assurance Systems

Audit suppliers and product Strictly implement a receipt and Modern logistics operation system

qualifications and control access; acceptance inspection system to Including temperature and humidity monitoring and regulation system

perform monthly and annual review of track and control the goods to be

and transportation management system (TMS). The Company has 5

suppliers and varieties and dynamic processed. The goods may be

management; conduct on-site accepted and warehoused only large-scale logistics centers equipped with modern logistics facilities Initial

inspection of key suppliers and risk Acceptance when they meet the and equipment for drug warehousing conveying sorting shelving operation

control in advance. inspection requirements. and delivery to efficiently accommodate the storage and distribution audit

needs for drugs and other commodities. Our cold chain facilities are

well-equipped. Our verification calibration cold chain management

1 2 system and emergency plan are perfect. Our temperature control

Provide cordial and

system monitors in real time 24 hours a day. Our temperature control

professional pharmaceutical Perform real-time

services; collect monitor and monitoring and regulation system ensures the safe storage and monitoring of

report adverse reactions; Store temperature and transportation of drugs and other commodities.strictly implement a recall Maintenan-sales/ humidity and regular

system handle customer after-sales 6 Quality 3 ce in ware- maintenance to assure

complaints in a timely manner Management house the quality of goods in

and provide appropriate after- Center warehouse.sales service to ensure drug Computer management system

safety. 5 4 Our computer system consists of SAP MDM system WMS ERP system

POS system CRM system EPS etc. which realizes the full coverage of

procurement inspection warehousing sales distribution after-sales

Store

Outbound and retail links ensuring the quality control and auxiliary business

Strictly implement an acceptance and acceptance/ review services of the computer system in the whole process of procurement

rejection system and perform monthly display Strictly implement an outbound sale and storage.quality inspection; dispose of goods review system and abnormal

that have expired and with quality goods are prohibited from

problems according to regulations to outbound delivery to assure the

assure the quality of drugs and other quality of outbound goods.goods at the stores. Drug traceability system

Attaching great importance to the construction of a drug traceability

system the Company has developed and launched an internal data

acquisition platform online. We connect the traceability platform and

* Initial operation audit: Audit the first partners (the manufacturers or enterprises with which the Company has established the supply-

code scanning equipment to our computer system to meet the

demand relationships) and the first varieties (commodities purchased by the Company for the first time).traceability requirements in order to ensure the traceability of drug

quality purchase sale and storage information.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 43

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Strict Control over Quality Sources Real-time Monitoring of Commodity Quality Information

The Company has built an independent and professional quality The Company has a drug quality information sharing platform and special personnel are responsible for inquiring about the quality

management team to conduct onboarding audit and dynamic control of information of 118 regulatory websites across the country for the purpose of daily inquiry daily transmission and daily processing. The

suppliers and commodity varieties and prepared institutional documents computer systems of more than 10000 stores across the country can be locked to suspend their sales of the varieties with quality risks and

including the Quality Risk Management System the Supplier Evaluation remove them from the shelves within 30 minutes.Management System and the Supplier Site Inspection and Evaluation

Standard. The professional team conducts field surveys on suppliers to

control drug quality from the source. In 2025 the Quality Management Quality Complaints

Department of the Group cumulatively conducted field surveys of 75

In our stores we have publicized our complaint hotline 12315 of the regulatory

suppliers and annually reviewed 2083 suppliers. The elimination mechanism

drug administration and our customer service hotline 400-6252-888. We have also

for high-risk suppliers was initiated according to the process and 155

posted the Customer Opinions in conspicuous positions of our stores. The

suppliers were eliminated in 2025.Company has made online complaint channels accessible. No matter whether

The Group's Management System for Blacklisted Suppliers has been through customer service hotline prefixed by 400 or social platforms such as

established to dynamically control suppliers whose abnormal operations or WeChat official account and mini program all customer complaints are handled

behaviors harm the Company's interests during the cooperation or with by special personnel to ensure that responses are made to customers' opinions

which the Company cannot cooperate or the cooperation needs to be and complaints in a timely and satisfactory manner.discontinued. As of the end of the reporting period a total of 63 suppliers

were included in the blacklist of LBX Pharmacy.In addition in order to standardize and strengthen the supplier and product

safety management of the "dropshipping" business via online new retail mini Drug Recall Management

programs the Company additionally established a "dropshipping" supplier According to the Management Measures for Drug Recall issued by the National Medical Products Administration the Company has

screening and evaluation mechanism in 2025 clarifying the onboarding formulated the Drug Recall Management System divided the drug recall into three levels according to the severity of drug quality and safety

standards for qualification quality and contract performance. We also hazards and set different recall time limits. Our subsidiaries and stores in different provinces are required to stop selling immediately after

established a risk control mechanism for sampling inspection of receiving a recall notice recall and recover the problematic drugs within the time limits and report to the drug supervision and

"dropshipped" products and performed normalized quality supervision over administration department and the marketing authorization holder according to the regulations.the dropshipped goods through random sampling third-party inspection

The Quality Management Department of the Group tracks guides and monitors the drug recall throughout the process to ensure timely and

and result traceability to effectively prevent quality risks in the circulation link.thorough recall. We subsequently dispose of the recalled drugs according to different results confirmed by the drug supervision and

administration department.Drug Recall Management

752083

Level 1 Recall Level 2 Recall Level 3 Recall

suppliers undergoing field suppliers reviewed

surveys that year that year The drug use might cause or has The drug use might cause or has The drug use generally doesn't

caused serious health hazards caused temporary or reversible cause health hazards but the

health hazards drugs need to be recalled for

other reasons

155淘汰63

The stores shall be notified of The stores shall be notified of The stores shall be notified of

stopping selling within 1 day stopping selling within 3 days stopping selling within 7 days

and the return shall be started and the return shall be started and the return shall be started

high-risk suppliers suppliers cumulatively

within 3 days within 7 days within 14 days

eliminated that year blacklisted

Time limits for

Definition

recallContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 44

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Drug Expiry Management Safe Medication Management

The Company strictly manages drug expiry and nonconforming drugs. We

systematically track and control the expiry date of drugs and give warnings

on "short-dated drugs" and "warned out-of-sale drugs". Our system The headquarters and stores of the Company appoint specialists to be responsible for pharmacovigilance

automatically intercepts targets and controls the "expired drugs". Expired timely evaluate and analyze adverse drug reactions and drug damages collect and monitor them report

drugs and other drugs with quality problems are managed as Pharmacovigilance them to the national adverse reaction monitoring system and maintain information communications with

nonconforming products. For the management of nonconforming products Management the drug supervision and administration department to ensure drug safety.the links for identifying reporting and destroying nonconforming products

are managed. We entrust a company that specializes in destruction of

hazardous wastes to destroy the nonconforming products without causing

any harm. The Company regularly carries out public welfare activities for the We actively employ digital intelligence technologies to promote reasonable medication management and

recycling of expired drugs from households in order to prevent the expired strictly control high-risk varieties through prescription control quantity restriction on purchase and real-

drugs from causing environmental pollution or resulting in social harm for name registration. We have also launched a reasonable medication system to supervise medication level

flowing into illegal channels and ensure the medication safety of the public. by level in combination with the identification of compatibility contraindications cashier interception and

Reasonable Medica-

licensed pharmacists' manual reviews. We assess the risks of high-alert drugs on a quarterly basis and

tion Management

Drug Expiry Management dynamically adjust the control catalogue to ensure drug safety.Drugs which will As an important window for the public to obtain drugs and health services we establish a unified Short-dated System

expire within 2 to pharmaceutical service guidance system. All pharmacy-related promotional materials are audited by the

drugs warning prompt

6 months Quality Management Department and Legal Department to put an end to exaggerated and false

propaganda. Our stores are staffed with licensed pharmacists to review prescriptions guide the customers

Pharmaceutical on medication manage chronic diseases popularize science education and healthcare knowledge

Drugs which will Service Guidance advocate rational drug purchase and medication avoid promoting expensive medicines or medicines Warned out-of- System

expire within unrelated to symptoms and help the customers "buy the right medicines with less money".sale drugs warning prompt

1 month

In reliance upon the core scenarios of its offline stores the Company has built a team of professional

pharmacists. Under the guidance of regulatory authorities at all levels we have actively carried out

The system

thematic publicity activities such as "National Safe Medication Month" and reminded the dosage

automatically

contraindications compatibility risks and storage methods by distributing health knowledge manuals

Expired Drugs which intercepts targets and answering questions on site and in other forms. We have also taken the initiative to walk into communities

controls the drugs and

drugs have expired Publicity of Safe schools and homes for the elderly organized public welfare lectures and free clinics and figured out manages them as non- Medication medication misunderstandings based on real cases. In 2025 the Company carried out offline safe

conforming products

medication publicity activities covering 67080 people and distributed 4471 copies of materials.Construction of a Quality Culture

During the reporting period the Company continuously deepened the construction of quality cultures actively participated in and organized several internal and external activities built a broad learning and

communication platform for licensed pharmacists (pharmacists) and created a favorable atmosphere where "everyone values quality everyone creates quality and everyone enjoys quality".Quality Talent System

The Company attaches great importance to building a professional team of licensed pharmacists and has more than 15000 licensed pharmacists. By constructing an education system for licensed pharmacists

(pharmacists) building a training base for licensed pharmacists (pharmacists) within the city formulating quality demonstration standards for teaching and training new licensed pharmacists (pharmacists) we

enhanced the overall quality control awareness and professional service capabilities of our frontline store staff.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 45

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Objectives and Indicators

Quality Management Training

Based on the Management System for Quality Policies and Objectives at the end

By integrating online and offline high-quality resources the

of each year or at the beginning of the following year the Company annually

Company has carried out comprehensive and systematic quality

training. The training has covered laws regulations professional reviews the quality policies and quality objectives. We are responsible for

knowledge and skills quality management system job inspecting assessing and summarizing the implementation of the quality

responsibilities and operating procedures etc. In 2025 the policies and objectives carefully analyzing the problems existing in the whole

monthly quality training for all employees achieved a coverage process of implementing the quality objectives and putting forward revision

rate of 100%. opinions on the quality policies and objectives. Through the review the new

quality policies objectives and decomposed objectives of all departments are

Internal Online Quality Training Program determined.in APP "Bai Xing Tong" in 2025

Annual Quality Objectives

Laws and regulations Professional knowledge and Quality management system

skills documents

Training on drug laws and Identification and maintenance Quality management systems No illegal No major quality and

regulations management of traditional duties and operating counterfeit or shoddy safety incidents related to

Chinese medicine decoction procedures

Laws and regulations related to pieces drugs goods and services

medical devices Management requirements for

Anti-drug knowledge and drug storage and transportation

Regulatory management of specialized drug management

online drug sales Management standards and

Disease knowledge training risk prevention for high-risk

Management requirements for drugs

major defects in GSP Basic knowledge training on

commodities Cold chain and specialized drug Achievements in 2025

Training on food and other non- management

pharmaceutical related First aid knowledge training

regulations Drug traceability management.........Acceptance rate of Outbound review rate of

100%100%

Quality Honors

The Company actively organized its stores and employees to

Achievements in 2025

participate in various pharmaceutical retail case collection skills

competition and other activities carried out by industry associations

and regulatory authorities and won a number of honors and

recognitions. In July 2025 at the 21st China Annual Retail Pharmacy

Conference and the 6th China Professional Pharmacy Development Error rate in outbound review

Forum 22 stores affiliated to LBX Pharmacy were honorably titled

the "Best Health Station" and "Excellent Health Station" respectively.In October 2025 Jiangsu company of LBX Pharmacy won the ≤ 1/100000

second group prize in the "Yangzhou Vocational Skills Competition

for Traditional Chinese Medicine Dispensing Employees". The

Company continuously consolidated the quality foundation and

jointly built quality and safety cultures. Achievements in 2025Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 46

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Supply Chain Safety

Supply chain is the core business link of the retail industry and the cornerstone for the Company's stable operation. LBX Pharmacy regards "supply chain safety" as its key management issue. We have constructed an efficient compliant and

responsible modern supply chain system in three business dimensions namely supplier management commodity management and logistics operation so as to effectively ensure the reliability of commodity sources quality safety and

efficient delivery. In addition the Company actively procures suppliers to jointly fulfill their ESG responsibilities. We are committed to establishing long-term stable and sustainable cooperation with suppliers and other value chain partners.Governance Risk Management

With the independence professionalism and compliance of the supply To strengthen supply chain security we regularly conduct risk identification and reinforce response measures enhancing the resilience and protective

chain as the core the Company has established a collaborative and capacity of the supply chain to ensure its continuity and stability. Additionally we actively leverage intelligent digital technologies to optimize

efficient supply chain governance system with definite rights and procurement logistics inventory and other segments minimizing detailed risks in the supply chain.responsibilities covering three major centers - commodity center

procurement center and logistics operation center as well as secondary Supply chain risks Potential impacts Countermeasures

and tertiary organizations such as supply chain regions. Besides the

functional boundaries of commodity management and procurement Suppliers might disrupt the supply of raw

departments are clarified and kept independent. The control is balanced materials or finished products due to factors

with operational efficiency through a normalized collaborative mechanism. Disruptions in such as production abnormalities natural Establish a refined supplier risk assessment mechanism based on "factory

disasters and economic fluctuations which brands" to dynamically identify related parties' abilities to perform contracts;

The Company implements a parallel and classified management model for commodity supply might lead to the suspension of production in Build a diversified supply matrix to reduce dependence on single sources;

commodity and non-commodity procurement to accurately match its Risk of rising the pharmaceutical industry and the

business needs. In 2025 we focused on implementing comprehensive In reliance upon the supplier collaboration platform predict the stocking procurement costs blockage of commercial distribution of

reforms and adjustments in commodity procurement from team demand give supply risk warnings optimize procurement plans and arrival pharmaceuticals and impairment of schedules and enhance supply resilience.organization to business control and divided professional lines according customer relationships brand reputation and

to commodity categories including pharmaceuticals non-pharmaceuticals market share.novel special medicines traditional Chinese medicines etc. Each business

line was coordinated with the corresponding assortment planning quality Build an independent quality management team to formulate strict quality

control supplier management and performance evaluation. The whole If the quality of the products provided by a standards covering all categories;

process from introduction of commodities to after-sales was tracked in supplier is substandard product recalls Perform regular and hierarchical quality audits and inspections on suppliers;

order to manage not only the procurement but also the sales. In addition Commodity customer complaints or regulatory penalties

the Company built a hierarchical procurement model for "the Group's might be caused which might impair the Strictly carry out incoming inspections "never tolerate" nonconforming quality problems products and reject them;

centralized procurement + subsidiaries' supplementary procurement". Some credibility of corporate brands and

subsidiaries built local category procurement teams for purchasing regional consumer trust. Optimize the inventory turnover strategy effectively control the proportion of

specialty products and making emergency responses. Hierarchical and short-dated commodities and guarantee medication safety at terminals.refined commodity procurement jointly achieved the stability high

efficiency and high quality of the supply chain while effectively integrating Due to natural disasters or public

resources and reducing procurement costs. transportation problems etc. problems in Build a national logistics distribution network. Provincial warehouses and

logistics distribution of commodities might store warehouses may be efficiently and flexibly allocated;

For non-commodity procurement (e.g. IT engineering administrative Logistics be caused resulting in untimely delivery; or

distribution risks Adopt advanced logistics technologies to improve delivery efficiency;services etc.) the Group implemented a centralized management model short-term changes of certain diseases (for

with the Non-commodity Procurement Department of the headquarters Risks of high example concentrated outbreaks of Empower identification of abnormal inventories with AI technologies and use

managing IT in a unified and centralized manner. The Business Demand inventory levels influenza etc.) would be caused including

intelligent replenishment systems to optimize inventory turnover;

Department the Non-commodity Procurement Department the Finance insufficient stocking which would lead to Encourage technological innovations by suppliers to jointly enhance overall

Department and the Supervision and Audit Department jointly participated loss of market opportunities and excessive supply chain resilience.in the procurement process forming a closed loop of "demand - execution stocking might cause high inventory level.- audit - supervision" and established an internal control mechanism for

hierarchical decision-making and mutual checks and balances to ensure Incorporate ESG performance into the supplier onboarding and classified

the transparency fairness and compliance of the whole procurement evaluation system and perform comprehensive scoring in different dimensions

process. including governance structure social responsibilities and environmental If a supplier violates environmental management;

To ensure the stability and reliability of the supply chain the Company has protection laws and regulations laborers'

Strengthen due diligence on supplier onboarding and implement "one-vote

formulated and implemented systems and norms including the Supplier Compliance risks rights or business ethics the supplier might veto" for qualifications compliance records and negative public opinions;

Management System the Operating Guidelines for Supplier Onboarding be subject to joint liability public opinion

the Management System for Supplier Review the Evaluation Standards for crisis or regulatory penalties; For suppliers with material violations breach of trust or moral hazard

immediately trigger the relationship reexamination mechanism terminate

On-site Supplier Surveys and the Quality Risk Management System to

cooperation and initiate alternative options if necessary.guarantee product quality and supply safety.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 47

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Strategic and Management Initiatives

Aiming at a safe and efficient sustainable supply chain the Company strengthens its supply chain resilience and risk resistance incorporates supplier management into its corporate ESG strategy and comprehensive risk

management system. We have established a full lifecycle management system covering supplier onboarding risk assessment and performance monitoring through strict management mechanisms and processes. In addition

we have clearly defined "onboarding as responsibility cooperation as co-governance". Through digital intelligence empowerment and collaborative innovation we have promoted the transformation of suppliers from

"transaction partners" to "value partners" and jointly built a sustainable supply chain system.Supplier Management System

Supplier Onboarding

Regarding supplier onboarding as the first line of defense for supply chain risk Eight Key Principles for Suppliers

management the Company upholds "prioritizing quality and being compliance-

oriented" as the core principle resolutely abandons the "pure price-oriented"

cooperation logic and firmly builds a cornerstone for supply chain safety from the

source.To improve the efficiency of supplier onboarding and risk control the Company fully

implemented the "system + platform + redline" model for supplier onboarding in 2025

achieving the organic unity of standardization digitalization and rigid constraints.Quality Assurance Stable Supply Fair Competition Rejection of Bribery

Institutional guarantee It is necessary to ensure It is necessary to It is necessary to It is forbidden to offer

With the Supplier Management System the Operating that the products meet ensure the continuity adhere to the principles any form of bribes or

Guidelines for Supplier Onboarding etc. as the core establish the national and LBX and stability of supply of fair competition and kickbacks to employees

an end-to-end institutional system covering qualification Pharmacy's quality to guarantee refrain from obtaining of LBX Pharmacy or

audit on-site audit risk assessment classification and standards ensuring the uninterrupted business contracts or business their families.safety and efficacy of operations. through improper

grading etc. Take the Transparent Cooperation Commitment

the products. means.as a required annex to the purchase contract and achieve

100% coverage.

Platform support

In reliance on the digital recruitment platform all links are

completed online with data traces and traceable operations

throughout the process effectively avoiding the risks of

human intervention and information tampering and ensuring

the openness fairness and compliance of the onboarding Information

process. Compliance with Law Integrity in Operations OthersConfidentiality

It is required to strictly We must provide We must keep the It includes but is not

comply with relevant truthful legitimate and commercial secrets of limited to all other

Redline constraints

national and local laws compliant products and LBX Pharmacy obtained actions that infringe

Fully implement the Eight Key Principles for Suppliers and and regulations and services and avoid any during the upon the Company's

clarify eight untouchable bottom lines of compliance. Any do not engage in any false advertising or collaboration strictly interests beyond the

behaviors crossing the redlines will directly lead to the illegal or non- fraudulent behavior. confidential and do aforementioned seven

termination of onboarding or cooperation and "one-vote compliant activities. not disclose them to principles.veto" will be implemented. any third party.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 48

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Supplier Classification Management

To solve the management complexity and blind spots of quality control caused

by the model of "several factories for one business and multiple subsidiaries for

the Group" the Company innovatively implemented the "factory brand

mechanism" in 2025 and decentralized the management unit from the Group

level to the actual coordinated legal brand entity so as to realize accurate Operating performance Industry performance Cooperation performance

penetration and refined management of product quality supply capacity and

performance. In this mechanism independent management files were Focus on assessing the financial With the focus on skills and Comprehensively consider on-time

maintained by legal brand entities and divided into five ratings: AAA AA A B soundness and production capacity creativity identify leading delivery rate quality acceptance rate

stability to ensure that the partners advantages in product quality and and degree of cooperation in ESG-

and C according to unified standards. The rating system focused on three core

have the basic capability of R&D potential. related matters which reflect the

dimensions: operating performance industry performance and cooperation

continuous supply. actual collaboration effectiveness

performance.and sense of responsibility.All brand rating results are dynamically managed and annually updated. They directly serve as the core basis for formulating procurement strategies determining the frequency of quality monitoring and defining the

depth of cooperation. Accordingly the Company performs differentiated management including granting incentives such as preferred cooperation qualification larger purchase share and better days payable

outstanding to Class AAA brands; including Class AA and A brands in the improvement coaching plan and driving their continuous improvement through regular communication and support; strengthening intervention

with management of Class B and Class C brands on the basis of existing cooperation. In view of the higher purchase shares for Class AAA AA and A brands the Company has simultaneously established a more efficient

and rigorous supporting audit mechanism to ensure that high trust is matched with high requirements and to institutionally guarantee the stable supply of high-quality resources and quality controllability.Preferred cooperation

Improvement coaching

qualification Strengthen intervention

Class AA suppliers Regular communication Class B suppliers with their management

Class AAA suppliers Higher purchase shares

Class A suppliers Support and drive Class C suppliers Support and drive

Better days payable

continuous improvements continuous improvements

outstanding

Supplier Assessment and Management

To be equal objective and impartial we have established a supplier performance appraisal mechanism.All departments collaboratively carry out regular and irregular inspections on suppliers which cover

quality price supply qualification safety environment service behavior and other dimensions. In

addition we draft refined supplier management plans based on our business characteristics including

frequency of communication with suppliers and depth of brand co-construction. Through promotion

demolition and elimination management the Company continuously assures the quality of suppliers. In

2025 we launched an elimination mechanism for high-risk suppliers according to our procedures and

eliminated 155 suppliers.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 49

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Supplier Communication and Capacity Building

The Company attaches great importance to communication and collaboration with suppliers. Through regular communication and special empowerment activities we procure our supply chain partners to consolidate their

sustainable development capabilities build a stable green supply chain ecosystem and jointly promote the sustainable development of the whole industry chain.In 2025 our strategic synergy with our suppliers was further deepened. Through more than 100 in-depth exchanges throughout the year we constantly consolidated our mechanism for regular communication with our

strategic and core suppliers and injected new ideas into our business synergy and growth. In terms of knowledge sharing we held 10 supplier seminars and special training sessions focusing on sustainable development

covering more than 500 people sharing practical experience in the whole process of drug traceability green environment-friendly packaging warehousing and energy management etc. Besides we conducted 13 brand co-

building and joint marketing activities with our key suppliers to deepen our strategic synergy.We continuously conducted supplier satisfaction surveys covering compliance management communication service response handling of after-sales problems cooperation transparency etc. Our supplier satisfaction

survey in 2025 suggested that the scores for partners' satisfaction with LBX Pharmacy in terms of "cooperation transparency" and "process efficiency" significantly increased on a year-on-year basis.On September 9 2025 the "100-day War" of LBX Pharmacy was initiated where On July 3 2025 LBX Pharmacy and China Resources Sanjiu Medical & On October 22 2025 LBX Pharmacy and Dong-E-E-Jiao Co. Ltd. carried out a

we joined hands with more than 40 supplier representatives sounding the horn Pharmaceutical Co. Ltd. convened the strategic matchmaking meeting 2025 traceability livestreaming activity so that nourishment and health preservation

of the charge in the fourth quarter. and drew a new blueprint for the coordinated development of the could become parts of thousands of households in a more affordable and

pharmaceutical and health industries. convenient way.Equal Treatment of Small and Medium-sized Enterprises

Small and medium-sized enterprises which play indispensable roles in the pharmaceutical industry chain are important forces

for promoting industry innovation guaranteeing drug supply and serving the grassroots. Committed to building an equal

impartial and transparent cooperation environment the Company works hand in hand with small and medium-sized enterprises

to jointly promote the ecological prosperity of the pharmaceutical industry.The Company has established a fair and transparent cooperation mechanism to protect the rights and interests of small and

medium-sized enterprises. The LBX product procurement platform is open to all suppliers for login registration review and

bidding. The platform implements strict regulatory mechanisms to ensure fair competition and transparent operations during

the cooperation. The Company also publishes a reporting hotline email address and mailing address sincerely inviting people

from all walks of life to supervise potential improper practices in the cooperation.In 2025 the Company did not have any overdue or outstanding payments due to small and medium-sized enterprises.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 50

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Product Management System

Construct a System for Products with Complete Varieties and High Quality Promote Introduction of Drugs from National

As one of pharmacy chains with the most complete varieties of medicines in China LBX Pharmacy has consistently upheld being "consumer-centered" as its core Centralized Procurement into Stores

concept. In reliance upon our nationally and globally collaborative procurement network we have built a pharmaceutical supply system with wide coverage In recent years the policy for centralized volume-based

diversified varieties and stable supply to consolidate the foundation of people's livelihood protection for medical accessibility.drug procurement organized by the state has taken root.LBX Pharmacy has taken the initiative to introduce drugs

Complete varieties High quality Preferential prices from centralized drug procurement bringing consumers

all-round health services featured by affordable prices

As of the end of the reporting period 24700 varieties of Insisting on being "quality-oriented" the Aiming to enable ordinary people to "buy convenient drug purchase diversified choices reliable

commodities merchandised by the Company had Company establishes strategic cooperation the right medicines with less money" and

quality and continuous medication.covered the medication needs for more than 610 with a number of Top 100 pharmaceutical relying upon our "procurement scale up

common diseases and recurrent diseases including companies and carefully selects genuine to tens of billions" to consolidate our At present 95% of the nationwide direct-sale stores of

more than 9800 varieties in the medical insurance good medicines from the source. We have bargaining power we have continuously LBX Pharmacy have made drugs from centralized

catalogue effectively protecting the drug rights and built a pioneering national drug quality increased the sales proportion of unified procurement available including 385 generic SKUs

interests of the insured groups. We innovatively launched information sharing platform constructed commodities and lowered our terminal which account for 78.41% of the generic names in the

the services known as "Original Medicine Zone" "Old a closed-loop management system for prices. In 2025 our sales from unified national centralized procurement catalogue covering

Medicine Zone" and "Scarce Medicine Purchasing Agent" end-to-end quality risk control realized procurement accounted for 75.9% 1489 types of common drugs drugs for chronic

and solved store shortage through the "one-click search traceability of quality problems warning of representing a year-on-year increase of diseases anti-tumor drugs antibiotics and other core

and purchase" function of our mini program so as to risks and closed-loop rectification and 3.5%. varieties to fully meet the daily medication needs of

respond to customers'personalized drug purchase needs protected the "medication safety" of the different patients.anytime and anywhere and enhance the inclusiveness masses (a core bottom line of people's

of our medical services with diversified supplies. livelihood) with actual actions. After the drugs from national centralized procurement

are available in the stores consumers needn't travel to

and from hospitals or queue in long lines to buy cheap

centralized purchased drugs. In addition extra

Promote "Cost-effective Projects" registration fees are saved. By relying on the "doorstep"

In 2025 the Company comprehensively promoted "cost-effective projects" carried out a new product selection strategy based on the cost performance of products pharmacy services the convenience for drug purchase

and made efforts in three key dimensions: "what to sell how to buy and how to sell". By optimizing the marketing procurement and sales procedures we provided is greatly improved. What's more the stable supply of

our customers with more cost-effective products and achieve a win-win situation between corporate benefits and consumer satisfaction. centralized purchased drugs and the professional

convenient services of our stores have effectively

ensured the continuity of medication for patients with

Focusing on Core Varieties and Optimizing Product Mix

chronic diseases and subject to postoperative

Focus on the core varieties with high frequency rigid demand and high trust. Strengthen the ability to guarantee the supply

rehabi l i tat ion faci l i tated their smooth health

of key varieties. Ensure that customers can quickly and accurately obtain the medicines they need when they need them.management and effectively improved their living

Truly achieve the health goal of "buying the right medicine" and consolidate the product foundation for the long-term

What to Sell standard and enhanced their sense of health gain.steady operation of the Company.Strengthening Strategic Procurement and Improving Cost Effectiveness

Continuously deepen strategic procurement. Through variety negotiation centralized tendering new product

introduction/evaluation and other means effectively lower intermediate costs on the premise of ensuring product quality

and supply stability help customers "spend less" and achieve a win-win situation among corporate benefits people's

How to Buy livelihood and well-being.Being Intensively Engaged in Terminal Operation and Guaranteeing Value Delivery

In terms of terminal sales the Company strives to build a refined price control system and implements precise management

and dynamic adjustment of price differences in different regions stores and categories. By opening up key links such as

inventory allocation store display employee training and practical empowerment we have created an efficient and

How to Sell collaborative closed loop of product merchandising. Regular review and iterative strategies guarantee stores' accurate

supply improve customer satisfaction and increase single stores' benefits. Centralized Drug Procurement Zone in Xi'an North Street

Store of LBX Pharmacy Shaanxi CompanyContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 51

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Build a New Ecology of Diversified Healthy Living Build Cost-effective Private Brands

Deeply focusing on segmented users' diversified healthy living needs LBX Pharmacy is committed to becoming Based on the development principle of "saving money for consumers and reassuring ordinary people" our

a healthy living management expert for community residents. Focusing on the three cores - "preventively own brands have been built around scenarios such as "health management health preservation and

treating diseases improving quality and enjoying life" the Company has built a matrix of "good but healthy exercise". Gaining in-depth insight into user needs and reshaping our user-centered product system

inexpensive" non-pharmaceutical products covering nutrition health care healthy dietary supplements health we select safe healthy and cost-effective healthy living goods for consumers. Our private brands cover

care equipment household daily necessities personal care and other varieties to meet consumers' diverse Chinese and Western patent medicines health-preserving Chinese medicines health foods general foods

healthy living needs. In 2025 the Company introduced more than 300 non-pharmaceutical SKUs. personal care products daily necessities etc. with more than 700 SKUs in sale.Furthermore the Company actively explored function upgrade of stores and created special zones with themes Our private brands directly deal with manufacturers without intermediate links surrendering profits to

consumers. In terms of varieties our private brands have intensively created pharmacy scenarios and built a

such as "cosmetology and personal care" "home essentials" "home care equipment" and "dietary

healthcare matrix that covers all scenarios. In terms of model we stick to independent innovations in our

supplements" in its pilot stores to provide one-stop healthy living solutions for community residents.whole link independently study non-pharmaceutical products from formula to packaging directly solve

pain points reject OEM and ensure product uniqueness and experience. Regarding quality control we

strictly control quality by supervising the whole chain and prefer drugs that have passed the consistency

evaluation health foods with leading formulas and personal care products exceeding national standards.With the mission of "making our products preferred by ordinary people good but inexpensive" we provide

cost-effective health products.Products of LBX Private Brands Recognized by International Authorities

In order to accurately accommodate user needs the private brand teams of LBX Pharmacy

aim at the pain point that paper tissues available from the market are soft but chippy. For the

purpose of making the tissues "both soft and tough" we have developed "Vitastic red nose

tissues" using imported virgin wood pulp French cream moisturizing factors and three-layer

lamination technology realizing the goal of "wiping repeatedly without redness and rubbing

without scrap in a more assuring manner". In March 2025 the "Vitastic red nose tissues" won

the "MUSE Design Awards 2025". This honor does not only recognize the aesthetics and

practicality of the outer product packages but also an international professional recognition

of LBX Pharmacy's concept of "innovation driven by user needs".Special Zone for Cosmetology and Personal Care Special Zone for Home Essentials

Special Zone for Dietary Supplements Special Zone for Home Care Equipment

CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 52

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Logistics Operation System

Committed to building an industry-leading and efficient smart pharmaceutical logistics operation system LBX Pharmacy has created a direct store distribution network of "1 national +3 regional +18 distribution centers" with a

total storage area of over 320000 m2.Complete Business Management System

Our logistics operation covers three core processes -

ordering warehousing and transportation. We deeply

utilize advanced intelligent systems to effectively improve Order Management Warehouse Management Transportation Management

our operation efficiency and delivery timeliness.SRM (Supplier Relationship Management)

WMS (Warehouse TMS (Transportation

+ Management System) Management System)

ERP (Enterprise Resource Planning)

Highly Adaptable Automation Technologies

During its construction and upgrading of a logistics system the Company has continuously introduced automated facilities equipment and technologies to improve human efficiency and reduce labor intensity deeply

empowered warehousing sorting distribution and other operations fully realized intelligent efficient and standardized logistics management and provided solid support for the efficient and stable operation of the

supply chain.Stocking： Sorting:

By building an automated three-dimensional warehouse access system we have greatly Introduced intelligent equipment such as DPS (Digital Picking System) latent AGV (Automated Guided Vehicle) +

improved the storage density and space utilization of products through three-dimensional seeding and sorting system and outbound delivery and temporary storage systems for shuttle buses to build an

warehouse design. Relying on the end-to-end automated operation technologies we have end-to-end intelligent sorting system efficient coordinate inbound and outbound delivery of pr\oducts and

reduced traditional manual access effectively cut our labor costs and improved our operation significantly improve sorting accuracy operation efficiency and delivery timeliness.efficiency and delivery accuracy.Changsha and Yangzhou Yangzhou Logistics Center adopted

Logistics Centers' Use of latent AGV + digital picking and

Automated Stackers for distribution technologies. AGV improved

Accessing the Warehouse human efficiency by more than 80%

Realizing Unmanned through the combined application of kiva

Access and Saving (logistics robot) racks + seeding and

Manpower by 50%. sorting benches.Case

CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 53

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Objectives and Indicators

Digitalization and AI-based Exploration of Logistics

To optimize customer experience eliminate operational risks and strengthen safety

The coverage ratio of the Transparent Newly introduced suppliers' pass

management the Company has strengthened digitalization and AI-based exploration of

Cooperation Commitment among rate in the qualification

logistics to help improve operational efficiency.the suppliers compliance review

100%100%

Logistics digitalization

Draft data-driven strategies

based on reports on Achievements in 2025 Achievements in 2025

timeliness of outbound and

inbound delivery

performance reports and

expense management

reports.Continuously shortened the days sales of inventories by

Security management Customer experience

enhancement

Video surveillance

platforms and security Logistics visualization 6 days

systems of distribution paperless delivery etc.centers across the country improve store experience

build a robust firewall. and delivery efficiency.Days sales of inventories in 2025 : 88 days

No overdue or outstanding payments due to

GSP and operational risk Acceleration of small and medium-sized enterprises

management inventory turnover

The warehouse patrol Refine algorithms and

assistant and the temperature optimize inventory

& humidity Monitoring allocation; shorten days

Platform effectively manage sales of inventory to (90)

risks. days No overdue payments in 2025Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 54

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Health Services

LBX Pharmacy actively responds to the "Healthy China" strategy. With the promotion of health equity as the core we have continuously optimized our national store network promoted the extension of high-quality medical

and health resources to a wider area and improved the accessibility and balance of health resources. We have created a closed loop of end-to-end services integrating online and offline services efficiently accommodated

customer demands and relied on professional pharmaceutical services to provide customers with accurate and effective health management plans to help improve the health of all people.Health Accessibility

LBX Pharmacy has continuously optimized the network layout of its retail stores on a nationwide basis promoted equal access to regional high-quality pharmaceutical resources provided customers with end-to-end health

management services and fully met people's growing diversified health needs.Create a Three-dimensional Retail Network

In 2025 we made remitting efforts to promote the development of our offline retail network "focusing on the lower - t i e r m a r k e t " . B e s i d e s w e Data as of the End of 2025 (Excluding Alliances)

actively innovated our new online retail channels. Through our "offline + online" model we created grassroots wide-coverage and high-density

health service touchpoints and effectively improved the health accessibility of grassroots residents.Deep Engagement in Offline Retail 14975

In 2025 we accurately deployed our offline store network according to the changes in different regional markets. On the one hand we optimized our stores on a nationwide basis

stores in areas where pharmaceutical retail resources were relatively saturated and consolidated our regional market advantages by improving our

store services and operational quality; On the other hand we promoted the exact expansion of key areas in order and met the health needs of

people in different markets by promoting the comprehensive coverage of regional markets.Based on the differences in the regional distribution of pharmaceutical resources in China our offline stores further focused on the lower-tier 18 Pro-

vince

markets namely the 3rd-5th tier prefecture-level cities where the aging was faster high-quality pharmaceutical resources were relatively scarce

provincial markets covered

and high-quality pharmaceutical resources and professional health management services were more urgently needed. As of the end of the

reporting period the Company had built an offline store retail network covering 18 provincial administrative regions more than 150 prefecture-level

cities and above and 437 county-level administrative regions (excluding municipal districts) on a nationwide basis. We had a total of about 15000

stores nationwide (excluding alliance stores) including 78% stores in prefecture-level cities and below and 45% stores in counties and towns. 150+ City

prefecture-level cities and above

Diving into Lower-tier Markets and Building a Solid Line of Defense for Chronic Diseases in Townships covered

The incidence of chronic diseases was high among township residents

especially middle-aged and elderly groups. Due to the relative lack of

medical resources and inconvenience of medical treatment the need for

chronic disease management needed to be urgently met. In January 2025 437 County

LBX Pharmacy opened a pharmacy in Tuchengzi Town Naiman Banner county-level administrative regions

Tongliao City Inner Mongolia Autonomous Region serving more than

(including municipal districts) covered

12000 township residents around it. The pharmacy focused on common

chronic diseases such as hypertension diabetes coronary heart disease

osteoarthrosis etc. It provided full-chain services such as medication supply

and guidance health management for chronic diseases knowledge

publicity and follow-up etc. Equipped with emergency medicines to 78% 45%

effectively solve the pain points of chronic disease management in

townships and villages - "long distance difficulty and slowness" it firmly stores at the prefecture stores in counties

built a health protection net. level and below and towns

CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 55

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Online New Retail Deployment

The Company has made unremitting efforts to innovate its new online retail

channels and services. We have actively built a new ecosystem of health

O2O&B2C

services through O2O B2C and private domain mini programs. Through

digital empowerment and integration of physical resources we provide Taking the resources of physical stores with wide offline coverage and

services such as door-to-door drug delivery and night drug sales bridging the deployment advantages of national logistics distribution as the

the "last mile" of health services and enabling consumers to conveniently cornerstones our O2O and B2C stores have fully settled in online

access medicines and health services without leaving home. mainstream platforms such as Tmall Taobao ele.me JD.COM

Pinduoduo Douyin and Kuaishou. This has made it convenient for

customers to place orders anytime and anywhere. Goods can be

delivered to customers as fast as 30 minutes.Data as of the End of 2025 In 2025 we comprehensively upgraded contract performance

efficiency and service quality of our online business launched a

traceability code system and established a full-dimensional service

quality evaluation system to further enhance customer experience

12352 and comprehensively ensure medication safety. As at the end of the reporting period the Company had 12352 O2O take-out service

O2O

stores 730 24-hour stores and more than 100 B2C stores meeting

O2O stores

the needs of full-time medical and health scenarios.

730 Private domain mini program

24h

24-hour stores We continuously upgraded the private domain mini program named

"LBX Pharmacy Healthy Door-to-door Drug Delivery" optimized the

online purchase link around the user experience made it more

convenient to find drugs and enhanced timeliness of delivery. We

further enriched our varieties launched the original drug zone

100+ added global shopping business scenarios opened up cross-border

product trading links and met customers' diversified needs for health

B2C

online B2C stores products.

63000000+

customers served online in 2025Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 56

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Deepening Professional Pharmacy Affairs

Being centered around customer needs LBX Pharmacy is committed to providing more professional comprehensive and safer health management services. We attach great importance to improving our professional

pharmacy service capabilities and continuously procure our stores to obtain medical insurance outpatient coordination qualifications and professional pharmacy qualifications so as to effectively improve the accessibility

and convenience of medication for patients. We optimize our allocation of licensed pharmacists train chronic disease experts customize personalized health management plans for patients and accurately protect health. We

carry out safe drug use and health science popularization on a regular basis to help the public to enhance their health and safety awareness build a strong line of defense for health and enhance the value of health services

in multiple dimensions.Professional Pharmacies Professional Medication Guidance

Medical insurance service qualification is an important foundation for ensuring that Professional medication guidance is the core cornerstone of

the masses enjoy convenient medical services and health accessibility is achieved. professional pharmaceutical services and licensed pharmacists are

The Company attaches great importance to the deployment of its medical insurance the key support for these services. LBX Pharmacy has continuously

service network and continuously improves its capacity for performing medical introduced and trained a team of high-quality pharmacists. More than

insurance services. As of the end of the reporting period 13411 of our stores had 15000 licensed pharmacists across the country strictly review

medical insurance qualifications and our designated medical insurance prescriptions to provide consumers with professional and standardized

pharmacies were widely distributed. This allows more people to enjoy high-quality medication guidance. In addition we deeply integrate digital

and compliant medical insurance and pharmaceutical services nearby. intelligence tools and AI technologies to promote the intelligent

upgrade of our pharmaceutical services. Our self-developed

The Company has actively responded to national policies and actively promoted the

"Intelligent Drug Recommendation" system has a built-in complete

implementation of outpatient coordination qualifications. As at the end of the

drug knowledge base with five core functions. Relying on AI algorithms

reporting period the Company owned 4511 outpatient coordinated stores which

we perform personalized pharmaceutical services and update the

were deployed at the doorsteps of pharmacies. We have made expedient

base in real time according to seasonal changes and the latest

coordinated settlement services available to the insured. Meanwhile we further

(LBX Pharmacy Shaanxi Headquarters Evaluated by the Medical pharmaceutical research results to ensure the timeliness and accuracy

reduced the burden of outpatient burdens of hospitals and enhanced drug

Security Administration of Weiyang District Xi'an as "Advanced o f i n fo r m a t i o n a n d e ffi c i e n t ly e m p o w e r t h e f ro n t l i n e t o

accessibility. Organization in Medical Security Work")

comprehensively improve the quality and efficiency of their

Besides the Company has constantly built professional pharmacies up to high standards. As at the end of the reporting period we owned 317 pharmaceutical services.dual-channel stores to guarantee the accessibility of key drugs such as special diseases and negotiated drugs. We had 1725 outpatient stores

"Intelligent Drug Recommendation" System Independently

for chronic and special diseases providing long-term and stable medical service support for patients with chronic and special diseases. We

Developed by LBX Pharmacy

made every effort to meet the most urgent and professional pharmaceutical service needs of patients with chronic and severe diseases.With extensive deployment of various professional pharmacies the Company has built a medical insurance service network covering urban

and rural areas with distinct levels and complete functions. The network has effectively improved the accessibility and convenience of medical

services effectively ensured the medication needs of the insured and laid a solid foundation for grassroots medical services for promoting the

construction of a healthy China. Express delivery of Disease/symptom

new products solutions

Latest products Combined medication

and reasons

134114511

stores with medical insurance qualification outpatient coordination stores Symptomatic Pathological

medication knowledge query

Decision support for Disease knowledge

317 1725 disease diagnosis/ base

treatment and

dual-channel stores outpatient chronic disease stores medication

Data as of the End of 2025Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 57

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Professional Chronic Disease Services Data as of the End of 2025

With the acceleration of population aging in China chronic diseases have become important factors affecting public health. The state has been

promoting the chronic disease management model of "prevention first hierarchical diagnosis and treatment". Retail pharmacies as important

supplements to grassroots medical services shoulder key social responsibilities. Since 2018 LBX Pharmacy has set up the "Chronic Disease and

Health Management Center" which has gradually built and iteratively upgraded an industry-leading full-link and full-course chronic disease

management system to provide tailored professional health care for its members with chronic diseases. 22890000+

As of the end of the reporting period the Company had equipped 10000 stores across the country with intelligent Bluetooth devices for self-testing

members with chronic diseases

of blood sugar blood pressure heart rate blood uric acid blood lipids and blood oxygen saturation for chronic diseases arranged licensed

pharmacists and chronic disease experts to provide patients with medication guidance health self-testing and other professional services. We cumulatively archived

integrated digital intelligence tools and AI technologies to realize dynamic updating and abnormal warning of electronic health records. Besides

we accurately analyzed patients' historical medication records test results lifestyle habits and other health data through algorithms and output

personalized health management plans. As of the end of the reporting period the Company had registered more than 22.89 million members with

chronic diseases served more than 140 million self-tests followed up on more than 42.8 million persons and carried out 37700 online and offline Coverage rate of chronic disease

health education sessions. management among stores

Chronic Disease Knowledge Grand Prix 100%

Since 2020 LBX Pharmacy has annually carried out chronic disease knowledge grand prix. We have improved our employees' professional

service skills through the "contests instead of training". Synchronously we have set customer health self-testing clocking challenges and funny

interactions known as "healthy enthusiasts' journey" to encourage customers to take the initiative to pay attention to their own health and

cultivate good health management habits. In the Chronic Disease Knowledge Grand Prix 2025 25000 employees of direct-sale stores in total Cumulatively followed up on

participated in the competition. More than 1.01 million customers participated in the self-test clocking with a year-on-year increase of 843000.

42800000 persons

Cumulatively served Online and offline health

self-tests of publicity education

sessions performed

140million+

persons 37700

Care for Disease Types

Focusing on the core needs of critically ill patients LBX Pharmacy is deeply engaged in Empowering Health with Popular Sciences and Supporting Patients Self Management

performing professional pharmaceutical services for multiple diseases. In reliance upon the

To help improve long-term self-health management abilities on June 13 2025 the

deployment of professional DTP pharmacies nationwide we actively carry out care actions New Specialty Medicine Service Center of Xiangya Store LBX Pharmacy and Dr.for breast cancer skin diseases hemophilia leukemia lung cancer and other diseases. The Chen Junchen Department of Dermatology Xiangya Hospital Central South

Company has created a variety of doctor-patient and patient-patient communication University organized a special health popular science lecture. With the core concept

scenarios with "care for disease types" as the link promoted communications between of "scientific cognition standardized treatment and end-to-end management" the

pharmacists and patients and among patients and constructed a rich "patient-friend activity helped patients with atopic dermatitis realized the transformation from

group ecology". We normally perform offline free volunteer clinic activities and online live "passive response" to "active prevention" improved patients' long-term self-health

science popularization activities integrate life and health topics or salon activities based on management ability through professional guidance and empowered patients and

follow-up medication guidance and help patients and their families build confidence in their families to scientifically respond to disease challenges.overcoming diseases through continuous professional services.Case

CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 58

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Customer Services

LBX Pharmacy upholds being "customer-centered" as its service concept and abides by the Law of the People's Republic of China on the Protection of Consumer Rights and Interests. We have established pre-sales sales and

after-sales service systems covering the whole online and offline processes to efficiently respond to and properly handle customer feedback and complaints. We stick to responsible marketing effectively protect consumers'

rights and interests and continuously improve service experience and customer satisfaction.Customer Service System

In 2025 we further focused on customer needs and comprehensively promoted the transformation of store customer service from being "transaction-based" to be "relationship-based". That was the Company changed from a

traditional drug trader to a professional health management partner around customers. We have built a three-dimensional service system with deep online and offline integration covering all scenarios and conveying

professionalism warmth and convenience to all users.Service Principle Member Services

The Company has continuously maintained and improved omnichannel membership operations. We conduct refined

Service concept: Be customer-centered transforming from being "transaction-based"

operations through private domains such as WeCom official accounts communities and mini programs so as to

to "relationship-based"

seamlessly connect online and offline services deepen user interactions and enhance value. As of the end of the

reporting period the Company had nearly 110 million members.Store operation rules: We have established a seven-level membership growth system. Under this system members enjoy corresponding affordable and full range; cordial services; tidy and bright; first

in first out benefits according to different membership levels including member discounts point-based benefits and different

exclusive monthly annual and birthday gifts. We also regularly interact with our members provide one-on-one

medication guidance and follow-up and improve our members' healthy life quality.Affordable Affordable

and full range services

We supply a full range of affordable Based on cordial services we

products so that customers "can provide customers with caring

spend less money and buy the right and considerate services.medicine".Tidy and bright First in first out

Seven-level Member Growth System

Keep stores clean and bright Ensure that drugs are sold

to enhance customers' according to the principle of "first in

shopping experiences. first out" so that customers can feel

assured to buy and use them.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 59

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Omni-Channel Listening to Customers' Voices Responsible Marketing

In addition to offline stores the Company has continuously improved Sticking to the bottom line of drug compliance publicity LBX Pharmacy considers both marketing activities and responsibility fulfillment. Adhering to

its online service channels. Our 400 National Customer Service Center the concept of satisfying consumers employees and the society we have maintained orderly competition and harmonious development. All our stores

is guided by customer needs. We continuously listen to our customers' strictly follow the principle of seeking truth from facts truthfully introduce the efficacy adverse reactions contraindications etc. according to drug

voices through our national customer service hotline - 400-6252-888 instructions and strictly prohibit false propaganda that exaggerates the efficacy and reduces risks.WeChat official account and WeChat mini program.All our marketing materials comply with the Advertising Law of the People's Republic of China and the Drug Administration Law of the People's

In 2025 LBX Pharmacy served 144600 customers via its National Republic of China. Their contents are true and objective. Drug advertisements may be published after approval and posted on regular platforms after

Customer Service Hotline prefixed by 400 with a satisfaction rate of approval by the Quality Management Department and the Legal Department upon review. In 2025 the Company comprehensively summarized the

99.7%. A total of 4.299 million people consulted with us online. We advertising and marketing approval procedures and common problems formulated advertising review standards in accordance with relevant laws

provided our customers with a number of services including healthy and regulations optimized three advertising review procedures covering all online and offline marketing scenarios and ensured that the publicity

medication consultation store and product inquiry consultation on was compliant and in line with core values.commercial insurance business customer complaints and

In 2025 the Company did not commit any major violations related to product and service information identification and marketing. We built a strong

suggestions consultation on platform orders consultation on

line of defense in compliance with rigorous procedures effectively safeguarded consumers' rights and interests and industry order and continuously

franchising business etc.enhanced our brand image and social reputation.Safeguarding Consumer Rights and Interests

Customer Satisfaction

Focusing on customers' end-to-end experiences LBX Pharmacy does not only pay attention to customers' front-end medication

needs but also attaches importance to customers' after-sales feedback on services and products. The Company regularly

conducts customer satisfaction surveys and collects user feedback through multiple channels. In 2025 we cumulatively collected

feedback from more than 12 million people and our NPS was as high as 99.8% fully demonstrating the high recognition by the

market and consumers. We also established a review mechanism for survey results to improve our service standards in a

targeted manner and consolidate the cornerstone of customer satisfaction.In order to gain a deeper understanding of customer demand in 2025 the Company started the business transformation from

"a tradesman" to "an itinerant merchant" and constructed a visit mechanism at three levels - "headquarters coordination

regional deep engagement and store opening". The management team of the Company took the lead in regularly visiting the

terminal market listening to consumer demands exactly solving problems continuously improving service quality and

enhancing customer satisfaction.Handling of Customer Complaints

In 2025 our national customer service centers took multiple measures to optimize our service system. On the one hand the

mechanism named "High-rise Through Train for Customer Voices" was established to collect real feedback from customers

throughout the process. After the monthly key events and hot issues were reported by the "High-rise Through Train" the

Chairman's Office supervised the business departments to solve them specially; On the other hand we promoted independent

customer service operation throughout the process designed the survey link from the perspective of consumers and deeply

explored customer needs through questionnaires telephone calls and on-site interviews so that the customers acted as our

"intelligence officers" thus creating a complete closed loop of "collection-feedback-solution" for customer voices.Besides our Customer Service Center actively coordinated with all business departments to improve the efficiency of complaint

handling. Our customer service hotline rang for 8 seconds on average (the system prompted the waiting time of incoming

customers) and our customer service specialists responded within 3 seconds on average (when the system prompted an

incoming call it answered within 3 seconds on average) so as to realize a closed-loop handling process of response to

customers verification rectification and customer satisfaction follow-up within 2 hours. In 2025 our National Customer Service

Center handled 1922 customer complaints and 100% of customer complaints were handled in a closed loop.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 60

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Diversified Services

Diversified Store Services

In 2025 we integrated the concept of "altruism" into our store services actively

expanded the social functions of our pharmacies and built approximately 15000 stores Warm and Caring Support a Handwritten Thank-you letter from a 90-year-old Customer

across the country into health stations and social spaces for communities. Our stores

In March 2025 Mr. Huang a 92-year-old customer mailed a handwritten thank-you letter to a store of LBX Pharmacy in

provided 5 health self-testing services 7 professional pharmaceutical services and 6

Wuling East Road Taoyuan Hunan Province. Mr. Huang who suffered from several chronic diseases was a frequent

convenient and heartwarming services to continuously meet residents' needs for visitor of the store. Store Manager Yan Li and the clerk not only provided him with professional medication guidance

disease prevention medication safety and convenient living services. health tracking and other services but also often took the initiative to greet to him and deliver medicines to him on

door to door This made him feel at ease. Mr. Huang was moved and said that they were just like his own children.A LBX Store Clerk Awarded the Title of "a Courageous Model" for Saving a Person on the Street

On March 21 2025 Liu Fang the store manager of LBX Pharmacy's store in Chaohu North Road encountered a

syncopal patient on the street. In the moment of crisis she did not hesitate to lend a helping hand quickly carried out

cardiopulmonary resuscitation with two nurses from Chaohu Hospital of Anhui Medical University and saved the

patient's life. In May Liu Fang's good deed was recognized by the Committee of Political and Legal Affairs Chaohu

In 2025 we made 2820 convenient restrooms open in all our direct-sale stores meeting Municipal Committee of the Communist Party of China to be "courageous".the printing needs of 64652 customers. This year 4231 excellent cases of "altruistic"

services including 121 first aid cases sprang up in our stores. Behind the figures were

the consistent professional commitments and responsibilities of our employees.Chaohu Women's Federation Condoled with Liu Fang and Praised Her Extraordinary Courage and

Professionalism at Critical Moments. Source: Hefei Evening News

Case CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 61

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Commercial Insurance Services "Pharmacy +" New Scenarios Meeting Customers' Diversified Needs

To help the country build a more perfect efficient and multi-layer medical security To satisfy consumers' diversified needs LBX Pharmacy has promoted business innovations of its franchising business

network so that more protection and choices will be available to ordinary people in coordinated with well-known brands such as 7-11 and Meiyijia to create a "pharmacy + convenience store" model constructed

the face of diseases LBX Pharmacy has actively promoted commercial insurance a diversified ecology integrating health management convenient shopping and life services and jointly built a "Health

business promoted and publicized its commercial health insurance products such station" for communities.as Huiminbao and replacement of expired drugs and guided more customers to

Through the dual-track "pharmacy +" model we continuously enrich consumer service scenarios and make health services

participate in commercial insurance plans and get more health protection. As of the

closer to consumers' daily life: "+ pharmacy" implants daily consumption scenarios such as convenience stores and

end of the reporting period the Company had a total of more than 12000 stores

supermarkets into medical and health service sectors so that consumers can easily obtain professional health support when

that enabled business cooperation on commercial insurance payment especially

shopping in convenience stores. "Pharmacy +" introduces convenience goods and diversified life services into pharmacies.stores in prefecture-level cities and below that enabled commercial insurance

Consumers' daily shopping needs will be satisfied during their drug purchase. Their sense of experience and gain is enhanced

business so that people in county towns and villages could also conveniently enjoy

with one-stop life-oriented services.the commercial insurance for drug purchase claim settlement and other services.In addition relying on the Group's professional resources the Company also

provided professional services such as special drug distribution chronic disease

management and medication guidance for commercial insurance members

contributing to the diversified development of the national medical security system.LBX Health Pharmacy in Wangjiali Middle Road Changsha LBX Health Pharmacy in Jinkunyuan Changsha "Meiyijia"+ Pharmacy

Pharmacy + "7-11"

Stores' Enabling of the Medical Insurance Business to Make It

Convenient for People to Purchase Drugs through the

Commercial InsuranceContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 62

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Innovation-driven

intelligence and uses digital AI technologies and tools to drive efficiency improvement of the whole business chain. We vigorously promote development of our franchising and alliance businesses empower the

development of small and medium-sized chains and single pharmacies actively participate in the co-governance of industry associations and promote the healthy and sustainable development of China's

pharmaceutical retail industry chain.Digital AI

LBX Pharmacy adheres to the overall strategy for "building a technology-driven health service platform" and "digital AI empowerment" is one of its seven supporting strategies. As a pioneer in digital intelligence in the

industry the Company has made unremitting efforts to build and consolidate the digital intelligence system of the whole business chain and actively fostered "new quality productive forces" through comprehensive

upgrading of business driven by technologies. In 2025 based on deepening the transformation of digital intelligence we fully embraced AI transformation entered the AI track in three core dimensions: strategy scenario

implementation and improvement of AI organizational capabilities and fully empowered us to improve our operational efficiency and optimize our health services for end customers.In May 2025 the Company established the AI Application Strategy Committee which was personally headed by the Chairman of the Board of Directors to regularly discuss and promote major AI projects and plans.Technology-driven Health Service Platform

business model

Upgrading and transformation of traditional value chains product and service innovation innovation

Empower the frontline Omnichannel Membership

operations operations Smart supply chain C2M Extended services Ecosystem

Baixingtong Precision Loyalty Intelligent Smart product Internet + chronic Medical +

marketing management restocking selection disease management pharmaceutical +

Payroll Calculator testing

Content Omnichannel Sales forecast Marketing

My Tasks marketing reach and preci- Internet + medical combinations

sion marketing Traffic Store-warehouse consultation

Maruko AI Omnichannel commercializationcoordination

user digitaliza- WeCom Customized recom- Internet + health

Business Tool tion ecosystem Traceability mended product management Cross-industry

operations code platform combinations collaborations

Remote Consultation O2O smart

by Professional product WeChat mini- Supply chain Big data-driven Internet + Industry ecosystem

Pharmacists combinations program mall planning system product innovation testing services alliances

Informatization Data Governance AIGC Technical Systems Organization and Mechanism Ecosystem Cooperation

Vision Digital AI initiatives FoundationContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 63

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

AI Structure R&D Investments

In 2025 we made unremitting efforts to rationally allocate capital resources based on our

In 2025 the Company The core functions included AI own operating conditions to ensure the sustainability of investments in scientific and

established the AI Application strategic planning and technological innovations and maximize the benefits of capital use. We introduced and

Strategy Committee composed coordination of AI planning trained professionals from the field of digital intelligence to provide intellectual support for

of the Chairman President and and resource allocation of the the implementation of digital intelligence strategy. We also continuously deepened the

relevant officers whole Group application of digital intelligence around our supply chain operation human resources and

other modules to help improve our operational efficiency and optimize customer experiences.-

ion

Dec

is

akin

g

M Fully implementing the work

The AI technology and planned by the AI Application

Annual R&D investments

management organization Strategy Committee members amounted to RMB 325

directly led by the Chief and regularly reporting the

entm Technology Officer (CTO) progress of the work to the e 90.1998 R&D workersanag
decision-making RMB millionM

tio

n

ecu All employees learn to apply AI Ex

and innovatively explore the

All employees 0.41

implementation of AI in actual %

business scenarios Ratio of R&D investment to revenue

Deepening of the Supply Chain with Digital Intelligence

In 2025 the digital and intelligent construction of the supply chain focused on "full-link connectivity" and "intelligent efficiency improvement" and achieved a key leap from "online process" to "intelligent decision-making".Supplier Collaboration Platform Logistics Sector Supply Chain Plan Data Governance

Completed major upgrades; integrated the Achieved closed-loop control over the whole link of Optimized decision-making strategies and Strengthened the management of commodities

whole module including tendering bidding contract fulfillment reduced operating costs and expanded multi-dimensional rule identification as core information carriers unified and

order and financial collaboration (including significantly improved the timeliness of contract and verification capabilities; assisted in consolidated the master data on products;

online invoice submission and automatic AI- fulfillment and decision-making efficiency; identifying risks and optimizing space with an provided standardized business support for the

based identification); achieved full-link and real- comprehensively strengthened the management of intelligent system to enhance the accuracy and whole link covering contract management

time digital monitoring of suppliers' purchase traceability codes and successfully combined the timeliness of procurement and transfer procurement plan inventory management and

sale and inventory data and built an efficient traceability code and the 69 code into one thus documents and optimize inventory turnover. sales analysis and ensured data consistency and

and transparent new collaborative ecology. significantly improving the efficiency of traceability.warehousing and store operations while ensuring

the compliance and traceability of product flow so

as to improve both management compliance and

operational efficiency.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 64

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Digital Empowerment of Transformation into "an Itinerary Merchant"

In 2025 the Company initiated transformation of its business line from "a tradesman" to "an itinerary merchant" optimized its business model and strove to improve its services and customer experiences. Based on the above

background we independently developed and launched the intelligent tool "Itinerary Merchant Assistant" in September including functional modules "Itinerary Merchant Management" and "Call for Gunfire" so as to rapidly

respond to and efficiently satisfy frontline needs.Independent Store Inspection Invitation System and Rapid

On-site Services and Empowerment Response to Store Needs

The business staff creates business Pre- After the issuance of issues on store

plans for stores specifying the business Gunfire business clerks-goods-site operation types the

purpose stores accompanying issuance issues are effectively assigned to the

personnel and time. primary persons in charge of different plan

行 Stores business lines for follow-up according

to the business domains.Top Down

Record the specific business work Bottom up

completed and pending tasks; add Itinerary

+

Business Call for Gunfire Quick All business lines promise the

supplementary tasks after Merchant completion time of response within 24h

accompanying personnel check the responsesrecords Management and follow up on the response process business logs.Business lines in time.Based on the business logs and Post-

achievements of the itinerary Effective After the gunfire settlement the

business

merchants the store managers can solving resolution result is submitted. Based on

evaluate their work quality attitude and the resolution process and result the

effectiveness. evaluation Business lines stores evaluate the settlement.

01 Efficient Collaboration between the Regular and Standardized Management Efficiency and Quality Improvement Headquarters and the Stores 02 of Business Work 03 for Satisfying Store Demands

Empower the frontline to quickly respond to demand Perform complete management of "planning → execution Each "gunfire" can be effectively tracked and

improve service experiences and drive sustainable → recording → evaluation → optimization" to keep assigned to specific personnel.business growth. records on the whole business process.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 65

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Vigorous Promotion of AI Application

To fully promote the operation truly empowered by AI in 2025 we actively procured the in-depth application of AI in various business scenarios such as marketing procurement marketing human resources and

administrative management so as to improve our operational efficiency and promote our intelligent transformation and development."LBX Maruko AI" Agent

In August 2025 LBX Pharmacy independently developed an AI-based comprehensive Q&A agent-"LBX Maruko AI" covering eight core business scenarios strengthening internal synergy efficiency and empowering frontline

employees with professional pharmaceutical service capabilities thereby enhancing customer experiences. During the reporting period "LBX Maruko AI" was iteratively upgraded nonstop achieving 7×24-hour real-time

response with an accuracy rate of over 95% in knowledge Q&A and the average response time was shortened to 3 seconds. This AI agent completely changed the traditional communication mode of "offline consultation +

level-by-level reporting" and significantly improved the efficiency of organizational collaboration.LBX Maruko AI

Chronic Disease Store Operation and

Medical Insurance Policy Services New Retail Maintenance

Accurately answer questions related Systematically answer Provide clear and Provide clear operation steps

to medical insurance policies such questions on SOPs enforceable SOPs for and solutions for common

as "overall outpatient policy

requirements" and "dual-channel pharmacist services performing new retail problems regarding inventory

reimbursement procedures" in real convenience services in contracts and solutions management cashier system

time for employees in different stores etc. to common problems in failure etc.places. At the same time service distribution.comparative analysis of medical

insurance policies in multiple places

is provided in the form of charts and

other forms to assist in business

decision-making.Human Resource

Administration Itinerary Merchants Traceability Code Product Training行

Give standardized answers to Give exact replies on work Provide clear and Information on product selling

high-frequency questions on standards operating efficient answers to points recommended scripts

attendance holidays guidelines departmental common warehousing usage dosage and other

administrative services etc. responsibilities and other and sales problems information.questions on "itinerary when promoting the

merchants". traceability code.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 66

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible CitizensPilot Application of Smart Agents in "Health Pharmacies”

Focusing on the pain points such as "irregular operations weak professional capabilities and difficulties in obtaining resources" in small

and medium-sized stores in the pharmaceutical retail industry the Company promoted the application of smart agents in its "health

pharmacies" on a pilot basis in 2025 transforming its own mature practical experience in product management business diagnosis

pharmaceutical services and other fields into a pilot AI agent system. As at the end of the reporting period the pilot AI agent system

covered more than 200 franchise stores.The pilot AI agent could effectively help franchisees solve their pain points and avoid empiricism from the perspective of business health

evaluation business catalog diagnosis and intelligent product replacement. Through intelligent analysis of large models franchise stores

were scientifically empowered to improve their business efficiency.Enhancement of All Employees' AI-based Organizational Capabilities

To procure all employees to adapt to the pace of digital and intelligent transformation in 2025 the Company systematically promoted the

"AI Learning and Talent Training" program and created online AI learning platform and offline practical training camp as a dual-track

model in the establishment of a learning system.It covered course modules such as basic AI application intelligent tool operation data interpretation ability etc. More than 100 AI courses

and learning materials were provided. Employees could independently choose their learning paths according to their job needs. Offline

the Company launched the "AI Innovation PK Competition" set AI-related practical topics attracted over 2000 employees to participate

and generated more than 20 cases.Besides the Company created a hierarchical and classified AI talent matrix and internally implemented a certification system at three

levels - "AI Application Specialist - Technical AI Backbone - AI Application Expert". Those who passed the certification could receive special

incentives and promotion inclination. That year more than 100 employees passed the intermediate and above certification becoming the

core backbones of the Group's digital and intelligent transformation and injecting inexhaustible impetus into the continuous innovation

into the organization.Data as of the end of 2025

100+2000+20+

AI courses provided online persons participated in the AI cases generated

innovation PK competitionsContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 67

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Cost Reduction and Efficiency Improvement

Optimizing Resource Allocation Strengthening Financial Control

During the reporting period the Company continuously addressed resource allocation During the reporting period the Company adopted a sustainable development approach formulating a series of key

issues from a strategic perspective while emphasizing refined management in daily strategies and measures for cost reduction and efficiency enhancement based on identifying financial materiality issues and

operations. This approach aimed to minimize unnecessary resource wastage consistently associated risk-opportunity factors.lower operational costs and enhance operational efficiency thus enabling the Company In combination with the advantageous financing products of different banks the Company compared the interest rates and

to steadily advance through long-term market competitions. repayment terms of different channels and gave priority to replacing high-interest liabilities to reduce financial expenses

On the one hand the Company actively strengthened is communications with store thus effectively reducing the comprehensive borrowing interest rate. We also made rolling fund forecasts reasonably

tenants and reduced rental expenses based on regional market dynamics stores' arranged the financing periods according to the capital demand and avoided the tight capital chain and additional interest

operating performance and long-term cooperation visions. On the other hand the expenses caused by short-term loans and long-term investments. The Company continuously strengthened the refinement

Company continuously revitalized and reused the existing space resources. In view of the of cash flow forecasts focused on key milestones such as purchase payment and medical insurance payment cycles and

area redundancy or unreasonable layout of some stores through internal functional reserved reasonable and safe funds to ensure the stable and efficient operation of the capital chain.reorganization we introduced the originally inefficient or idle physical spaces into In addition the Company actively used digital tools to establish a financing cost monitoring system dynamically tracked and

diversified health products to improve the space utilization and leased some idle areas to optimized the financing structure of the Company and monitored the fund flow and financial expenses in real time

reduce operating costs. throughout the process so as to avoid all unreasonable expenses.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 68

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Industry Symbiosis

As a witness and participant in the development of China's pharmaceutical retail industry LBX Pharmacy has always adhered to its original intention of symbiosis and co-prosperity with the industry spared no effort to

promote the sustainable development of the pharmaceutical and health industries built a community of industrial ecological destiny and made sound contributions to the realization of the goal of "Healthy China".Facilitation of the Industry Development

At present the pharmaceutical retail industry has entered a critical period of high-quality development and transformation. The acceleration of industry clearing and chain integration have become the main tasks. LBX

Pharmacy actively gives full play to the driving effects of leading enterprises relying on its sales network with a broad coverage and its good reputation accumulated for more than 20 years. For the purpose of "win-win and

altruism" the Company takes its two business models - "franchising" and "alliance" as the starting points. It integrates various ecosystems inside and outside the industry empowering brands management supply chain etc.of more pharmacy peers in an all-round manner. At present the Company has created an ecological pattern centered around its retail business (direct sale system) where "LBX Health Pharmacies" the franchising sector and

"Easy Drug" the alliance sector make concerted efforts.Franchising: Integrating the Existing Market and Delving into Lower-tier Markets

In 2025 LBX Health Pharmacy adhered to the development concept of "industrial symbiosis and value co-creation". Practising the development policy of "brand empowerment compliance foundation building digital drive

and delving into lower-tier markets" we provided our franchisee partners with standardized system outputs and full-link empowerment support to help franchise stores develop with high quality and play a leading role in

standardizing industry order activating industrial vitality and protecting the health of the grassroots. In 2025 our "health pharmacy" franchise business achieved further development. During the reporting period a total of

5243 stores joined in LBX Health Pharmacy with an increase of 791 stores newly opened during the year. Our distribution sales approximately amounted to RMB 2.412 billion representing a year-on-year increase of 6%.

Innovative Development Initiatives for LBX Health Pharmacy in 2025

Deepened Integration of Efforts for Delving into Building of an Industry Optimization of the

Existing Markets Lower-tier Markets Collaborative Ecology Hierarchical Operation Strategy

With the focus on supporting the re- Held the "March 18 Franchising and Investment Joined hands with upstream pharmaceutical Established a hierarchical store operation

franchising of old stores and project Promotion Livestreaming Festival" and "December 16 companies and local industry associations to system according to the stores' locations

franchising we launched targeted measures Ecological Cooperation Conference"; focused on the carry out the campaign named "health Services (cities/counties/townships) and business scale

such as subsidies for upgrading old stores county-level township markets launched special for the Countryside" and organized a team of and matched differentiated product supply

and special support for compliance support policies for returning home to start businesses professional pharmacists to provide in-store training content and marketing support.transformation in 2025. and encouraged migrant workers veterans and other guidance for franchise stores.groups to return to their hometowns to open

pharmacies.Franchisee Case: 14 Small Chain Pharmacies in Anhui Province Joined as a Whole to Optimize Inventory and Increase Gross Profit

14 small pharmacies affiliated to Baixiu Chain in Wuhu Anhui Province faced problems such as internal store quality management compliance risks and chaotic commodity structure in the process of their

operation. In August 2025 this enterprise joined in LBX Pharmacy to optimize its product mix adjust its marketing strategy and improve its management efficiency with the aid of LBX Pharmacy's intelligent

diagnostic tools. Besides our intelligent replenishment system was used for accurate and efficient stocking. Compared with the situation before its joining as of the end of the reporting period the enterprise's

days sales of inventory had been shortened by more than 20 days greatly improving the inventory turnover efficiency. From August to December 2025 the enterprise achieved a year-over-year increase in sales

by 3.9% year-over-year increase in gross profit by 5.6% and year-over-year increase in gross profit margin by 1.8%.CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 69

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Alliance: Cooperative Sharing of Five Major Resource Industry Co-construction

Advantages

Participation in Industry Associations

Through Collaboration LBX Pharmacy's 'Easy Drug' alliance business

is positioned as a 'third-party comprehensive empowerment service LBX Pharmacy actively participates in the co-construction of industry associations to promote industry standardization and high-quality development. By

platform' adhering to the principles of 'co-integration co-creation the end of the reporting period LBX Pharmacy and its subsidiaries had joined in more than 60 national provincial and municipal industry associations.and sharing'. Focusing on pharmaceutical retail market operation Xie Zilong Chairman of the Company as a deputy to the 11th 12th and 14th National People's Congress honorary president of China Medical

services and product output as its core business LBX Pharmacy Pharmaceutical Material Association vice president of China Association of Pharmaceutical Commerce and president of Hunan Association of the

provides full-category product output supply chain integration Pharmaceutical Distribution Industry has actively made suggestions through in-depth grassroots research field research organization of seminars and

professional training and management consulting services for small symposiums for industry associations over the years. He has participated in the formulation of the industry's Self-discipline Convention and taken the lead

and medium-sized chain pharmacies. By leveraging platform

in undertaking to abide by it. He has played positive roles in promoting the healthy and orderly development of the industry and protecting consumers

advantages it helps alliance members lacking procurement

rights and interests. All theaters of the Company have actively participated in meetings and activities organized by local industry associations provided

resources and operational expertise improve their overall

suggestions for formulating and improving industry norms procured the industry to strengthen its self-supervision mechanism and promoted the

management capabilities.common progress of the industry.As at the end of the reporting period our alliance business had

covered 29 provinces and cities with 22491 alliance stores (not Associations/Societies Participated by LBX Pharmacy (Group & Provincial Subsidiaries)

included in the total number of the Company's stores). In 2025 the

Company realized distribution sales of RMB 440 million with a year-

on-year growth of 4.26%. Besides as of the end of the reporting * China Association of Pharmaceutical * Shaanxi Province Pharmaceutical Retail * Changzhou Pharmaceutical Quality

period the Company had participated in shareholding in 225 Commerce Industry Association Management Association

alliance partners corresponding to 11078 stores and the * China Nonprescription Medicines Association * Shaanxi Province Licensed Pharmacist * Yangzhou Pharmaceutical Association

corresponding retail scale was RMB 13.056 billion. Association

* China Association for Public Companies * Yangzhou Biopharmaceutical Industry

Sharing Five Major Advantages with Alliance Partners * Shanghai Pharmaceutical Commerce Industry Association

* China Federation of Logistics & Purchasing

Association

Pharmaceutical Logistics Branch * Yangzhou Medical Security Research

* Shanghai Traditional Chinese Medicine Industry Association

* Hunan Province Pharmaceutical Circulation

Association

Industry Association * Wuxi Health Food and Cosmetics Safety

* Tianjin Pharmaceutical Industry Association Association Jingjiang Pharmaceutical Industry

Sharing Sharing * Hunan Association for Public Companies

Sharing Brand AssociationOperational Training * Tianjin Single Purpose Prepaid Card Association

Influence * Hunan Pharmacist AssociationSystems Systems * Zhangjiagang Medical Insurance Association* Tianjin Medical Insurance Research Association

* Hunan Provincial Consumer Rights Protection

01 03 05 * Wuxi Pharmaceutical Distributors AssociationCommittee - Consumer Rights Protection * Tianjin Pharmaceutical Retail Industry

Sharing Sharing Service Station Association * Jiangyin Food Safety Industry Association

Product Digital

Resources Technologies * Anhui Province Pharmaceutical Industry * Inner Mongolia Pharmaceutical Association * Linyi Medical Insurance Pharmacy Association

Innovation Association

* Inner Mongolia Pharmaceutical and Medical * Linyi Medical Insurance Research Association

02 04 * Anhui Province Pharmacist Association Equipment Industry Association Shanxi

* Nantong Pharmaceutical Chamber of

Pharmacists Association

* Gansu Province Longyao Industry Association Commerce

* Hubei Province Pharmaceutical Industry

* Gansu Province Medical Insurance Research * Nantong Pharmaceutical Association

Association

Alliance Case: Henan Medium-sized Chain Association * Nantong Pharmacist Association

Franchise Growing Customer Flow * Changsha Pharmaceutical Circulation Industry * Gansu Province Licensed Pharmacists

Association * Nantong Federation of Industry and Commerce

A medium-sized pharmacy chain in Sanmenxia City Association (General Chamber of Commerce)

Henan Province faced problems such as declining * Zhuzhou Pharmaceutical Industry Association* Guangxi Retail Pharmacy Association

customers and low gross profit margin in the process of * Nantong Information Network Security * Hefei Pharmaceutical Industry Association

its operation. In February 2025 the company chose to * Guangxi Pharmacist Association Association

become an alliance partner of LBX Pharmacy. While * Wuhan Medical Insurance Research Association* Guangxi Medical Merchant Association * Hai'an Medical Security Research Association

cooperating with LBX Pharmacy in the commodity * Wuhan Pharmaceutical Industry Association

supply chain it adjusted its product mix and catered to * Guangxi Medical Insurance Research * Nantong Medical Security Research

customer needs through the consulting services and Association * Wenzhou Medical Insurance Research Association

intelligent diagnostic tools of LBX Pharmacy. Its Association* Zhejiang Pharmaceutical industry Association * Xi'an Medical Insurance Research Association

pharmacies' customer flow continued to grow. From * Yiwu Medical Insurance Association

* Jiangsu Pharmaceutical Commerce Association * Tongliao Inner Mongolia TCM Industry

February to December 2025 the number of visitors

* Jinhua Pharmaceutical and Health Association Association

increased by about 8% on a year-on-year basis and the * Shandong Province Retail Pharmacy

gross profit margin grew by 3% on a year-on-year basis. Association * Hangzhou Food and Drug Safety Association

CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 70

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Participating in Industry Standard Formulation

LBX Pharmacy has actively participated in the discussion and drafting of group standards contributing professional wisdom and innovations to the

standardized development of the industry. Since 2020 it has participated in formulating a number of important standards of China Association of

Pharmaceutical Commerce: including 13 health management and service specifications such as the Pharmaceutical Network Operation Quality

Management Practices the Retail Pharmacy Health Station Service Guidelines the Retail Pharmacy Specialist Pharmacist Pharmacy Service

Capability Evaluation Guidelines the First Electronic Data Exchange Standard and the Health Management Practices for Common Minor Diseases in

Retail Pharmacies.During the reporting period

The Quality Management Department of LBX Pharmacy participated in the formulation of the Guidelines for the Evaluation of

Pharmacy Service Capabilities of Specialist Pharmacists in Retail Pharmacies the Guidelines for Health Station Services in Retail

Pharmacies the Full Course Co-management Standards for Patients with Diabetes Hypertension and Dyslipidemia the Health

Management Standards for Common Minor Diseases in Retail Pharmacies the Pharmacy Service Standards for Contraceptive

Drugs for Women of Childbearing Age in Retail Pharmacies and the Service Standards for Special Disease Drugs in Retail

Pharmacies by China Association of Pharmaceutical Commerce.LBX Pharmacy Chain (Shanghai) Co. Ltd. participated in the compilation of the Guidelines for Quality Management of Individual

Safety Reports of Pharmaceutical Retail Enterprises and the Guidelines for Compliance Management of Pharmaceutical

Advertising and Science Popularization of Retail Enterprises by Shanghai Pharmaceutical Trade Association.The Company has continuously deepened its

construction of the health service system. It is

committed to building professional digital and

diversified demonstration stores to give full play

to the benchmarking effects of its demonstration

stores. In 2025 Changsha Xiangya Store won the

h o n o ra r y t i t l e o f "' P s o r i a s i s S t a n d a r d

'Demonstration Store" awarded by China

Association of Pharmaceutical Commerce.Changsha Xiangya Store Changsha Xinmin

Lukou Store Changsha Dongtang Store Xi'an

North Street Store Xi'an Xingqing Store and

Xi'an Jinhua North Road Store won the honorary

title of "'Thyroid Standard' Demonstration Store"

from China Association of Pharmaceutical

Commerce committed to providing patients with

professional standardized and full-process

pharmaceutical services and health support. Operation of LBX Pharmacy Changsha 2025 AstraZeneca Retail DTP Strategic Cooperation Award &

Xiangya Store as Psoriasis Treatment AstraZeneca Store Critical Illness Management

Under the leadership of the demonstration

Drug Demonstration Pharmacy in 2025 Award-Lung Cancer

stores the Company continuously improved its

overall store services. In addition we shared our

service concepts and experiences with our

industry peers through industry exchanges and

jointly promoted the improvement of the overall

services of the pharmaceutical retail industry.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 71

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Employee Development

LBX Pharmacy has consistently upheld that "talents are the foremost resources" as its development concept. Adhering to the principle of compliant employment we have actively created a diversified fair and inclusive workplace

environment. We have established a scientific talent reserve and promotion mechanism and a training system covering all employees and competitive remunerations and benefits. We attach importance to our employees'

physical and mental health and occupational safety procure our employees to better serve customers and ultimately achieve mutual benefit and win-win results with our and jointly move towards a sustainable future.Governance Risk Management

Human Resources Management Retail pharmacies belong to one of the labor-intensive industries. On the one hand the state has continuously strengthened the policy of staffing licensed

pharmacists for retail pharmacies. The staffing and practicing in key positions such as licensed pharmacists are related to corporate compliance risks; On the other

System hand the Company's employee scale in 10000 stores all over the country complex labor relations and employees' "selection retention and elimination" also fully

The Company has established a human resources test the Company's human resources management capability. LBX Pharmacy attaches great importance to human resources risk management regularly sorts out

human resources risks establishes risk assessment and management mechanisms focuses on core dimensions such as compliant employment training

governance structure at three levels - "decision-

development remunerations benefits health and safety. It has continuously strengthened identification of risks related to human resources and opportunity

making - management - execution" to ensure the

management effectively protected the legitimate rights and interests of employees and promoted its common growth with its employees.systematic and standardized promotion of its

human resources work. As the decision-making

Risks Potential impacts Countermeasures

level the Nomination Remuneration and Appraisal

Committee of the Board of Directors incorporates the Special personnel track the latest labor laws and regulations and conduct regular training on

human resources governance results into our If the Company violates labor laws and labor laws and regulations;

sustainable development strategy considers major regulations labor arbitration and

Policy and Improve the compliance employment management system conduct compliance audits on all

strategic human resources matters and supervises litigation disputes might be caused and legal risks aspects of employee management and protect the rights and interests of employees;

the implementation to ensure the matching of the Company would be fined and Jointly establish a compliance self-examination mechanism with the Legal Department

criticized by regulatory authorities.resource investment and strategy. The Human regularly carry out special inspections on employment compliance rectify potential hidden

Capital Center of the Group as the overall dangers in a timely manner and effectively protect the rights and interests of employees.responsible department for human resources work

consists of the Organizational Development Based on the local regulatory policies recruit personnel for key positions such as licensed

Department the Remuneration and Performance pharmacists to support store operations; organize employees to participate in the national

Failure to staff qualified licensed licensed pharmacist examinations and related training to increase the pass rate of examinations;

Department the Talent Development Department pharmacists might affect normal

and the HRBP Department. Our subsidiaries in Establish a talent reserve system build a multi-level talent echelon clarify the training operations. The loss of employees in key objectives and paths for the echelon and reduce the risk of core talent drain;

different areas have set up human resources Operational positions might lead to project

departments or appointed full-time personnel to risks Strengthen the construction of an employee training system to improve the professional skills of interruption and affect product/service

employees;

carry out relevant work according to the specific stability. The employees' lack of

conditions of their locations so as to fully protect professional skills will affect work Provide a competitive remuneration and welfare system to attract and retain talents;

the rights and interests of employees. efficiency and impair customer trust. Improve the employee career development system formulate clear career promotion paths for

employees and realize the resonance between employee growth and the development of the

The Company has improved i ts system for Company.guaranteeing its human resources system. We have

formulated several systems including the Group's

Negative events and low satisfaction of Establish a sound employee communication mechanism conduct regular employee satisfaction

Labor Relations Management System the Group's employees easily arouse concerns and surveys and respond to reasonable demands of employees in a timely manner;

Training Management System the Group's Internal doubts among the capital market Protect the legitimate rights and interests of employees standardize remunerations and benefits

Promotion Management System and the Group's regulatory authorities partners and the career development and enhance employees' sense of belonging;

Administrative Measures for Relief Fund for Tens of Reputational public reducing market trust and

risks Draft emergency plans for employees' negative public opinions handle various negative events Millions of Difficulties which cover recruitment impairing brand reputation. Negative

in a timely manner and resolve public opinion risks;

promotion remuneration incentives training events in industrial relations might lead

to less attractive talents of the Company Practise social responsibilities carry out employee charity health assistance and other activities development rights and interests protection etc. to

and restrict the long-term development in combination with the characteristics of the pharmaceutical industry pay attention to the protect the legitimate rights and interests of physical and mental health of employees and enhance employee loyalty.employees. of the Company.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 72

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Strategic and Management Initiatives

LBX Pharmacy takes "building a diversified fair and equal sustainable workplace and empowering employees to grow together with the enterprise" as its core human resources strategy. In combination with the characteristics

of the pharmaceutical retail industry we clarify four major development orientations: Firstly optimize the talent structure carry out diversified recruitment and consolidate the talent echelon. Secondly build a learning-

oriented organization which focuses on the needs of professional capability improvement and career development a hierarchical and classified training system and a fair and an equitable promotion and performance

management mechanism to support employees' career development. Thirdly deepen the "altruistic" culture integrate employee care and corporate culture and enhance employees' sense of belonging. Fourthly strengthen

health and safety management to safeguard the physical and mental health and safety of employees. We continuously enhance employees' sense of belonging and cohesion through an open inclusive fair safe and

humanistic workplace environment and drive employees to serve customers and create value under a better state.Employment Management

LBX Pharmacy attaches great importance to employment management strictly abides by the bottom line of compliance follows national labor regulations and international labor standards upholds the principle of fairness

transparency and non-discrimination and effectively protects the legitimate rights and interests of employees. The Company has continuously improved its remuneration incentive and welfare system created an inclusive and

diversified workplace environment built a sustainable talent team and promoted its sustainable development together with its employees.Employee Structure Labor and Human Rights

We strictly abide by internationally recognized human rights

standards such as the Universal Declaration of Human Rights

the ILO Declaration on Fundamental Principles and Rights at

Work the Labor Contract Law and other labor laws and

Female employees regulations as well as the labor protection system. We 36892 Under 30 7006 18.99% resolutely oppose any form of discrimination harassment

bullying or retaliation. Integrating the spirit of respect and

33212 Distribution 26722 protection of human rights into our corporate management 30-50 72.43%

employees in total by Age we actively create a healthy and favorable working

atmosphere and provide employees with fair reasonable

Over 50 3164 8.58% and decent working conditions and treatment. During the

Male employees reporting period we did not commit any violation of laws and

regulations such as child labor or forced labor.

3680

Legal Employment

The Company has formulated the Group's Employment

Management System. We enter into perform change

rescind or terminate labor contracts with our regular

Master's Degree employees according to law and conclude corresponding

9.98% or Higher 154 0.42% labor contracts with personnel who have labor relationships

such as post-retirement re-employment internships etc. The

Male employees

Bachelor's contract signing of all companies in the Group has been fully

659817.88%

Distribution Degree managed online and employees will sign electronic

by Educational contracts as soon as they join the Company with a signing

90.02% Female employees Background College 16165 43.82% rate of 100%. Reasonably standardize the procedures for Diploma employee onboarding replacement transfer resignation

Female employees

and handover and continuously improve the basic work

Below College

13975 37.88% standards and human resources procedures at the Male employees Diploma

headquarters and subsidiaries of the Group. Pay wages on

time five insurances and one provident fund. Timely follow

up on the labor dynamics of employees such as retirement

maternity and work-related injuries so as to fully protect

employees' legitimate and reasonable rights and interests.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 73

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Diversification Internal Communications

To be "simple efficient" "upright selfless" "equal" and "pragmatic" is the DNA of the corporate The Company attaches great importance to the employees' voices and establishes a normalized and multi-channel

culture of LBX Pharmacy. Committed to building a diversified talent team we strive to create a internal communication mechanism to ensure two-way information transmission and safeguard employees' rights

diversified equal and inclusive workplace environment and a warm working atmosphere for and interests. We have built platform named "Hard Gold" where all employees can put forward their suggestions

employees all over the country in order to inspire everyone to better give full play to their encouraging employees to actively make "golden suggestions" on operations management service improvement

expertise and advantages. At work we avoid discrimination and prejudice due to differences in process optimization risk prevention and control and valuable suggestions are rewarded. Since its establishment in

age gender nationality race complexion religious beliefs marriage etc. For our subsidiaries 2020 "Hard Gold" has established more than 150 golden suggestions and good questions raised by employees

covering different regions across the country we pay attention to retaining local talents actively rewarded and commended nearly 500 employees who raised high-quality questions thus improving employee

formulate talent retention plans and promote their implementation in accordance with the law. satisfaction and promoting the innovation and sustainable development of the organization.Proportion of female employees Proportion of female middle and Chairman's Through Chain

senior management

In March 2025 the Company initiated the "Chairman's Through Train" mechanism which aimed to build a

direct communication bridge to the senior management truly listen to employees' demands promote

90.02 47 problem-solving and realize management decentralization and organizational empowerment. As of % % December 2025 a total of 783 opinions were collected of which 521 were required to be replied with an

adoption rate of 70%. 100% of all opinions were followed up achieving "response to and settlement of all

problems" which effectively enhanced employees' sense of participation and improved problem-solving

efficiency.Employees of minority groups 3667

Collection Analysis Follow-up

Women's Power Through the scanning The Chairman's Office Coordinated the responsible

LBX Pharmacy pays full attention to women's power and its female employees of store QR codes (with maintained ledgers and departments to formulate

coverage rate of 100%) assessed natures and plans submitted them to the

account for 90%. We ensure the protection of women employees' rights strictly

and exclusive email priorities of the chairman for approval

complying with relevant laws and regulations such as the 'Law of the People's

received opinions with problems in before implementation and

Republic of China on the Protection of Rights and Interests of Women.' Moreover we

"reply required/no collaboration with fed back the results to

strengthen protections for women employees during pregnancy maternity leave reply required" by relevant departments. employees forming a closed

and breastfeeding. We respect their equal rights to development and aspirations categories. loop of "collection - analysis

for career progress encouraging women to utilize their intelligence and potential - resolution - feedback".to excel in various positions.Privacy Protection and Protection against Workplace Sexual Harassment

The Company has formulated a number of systems including the Group's Confidentiality Management System and

the Notice on Legal Matters Required for Providing or Obtaining Personal Information to strictly protect the privacy

of employees and prohibit intentional or unintentional disclosure of employee privacy to non-relevant staff. In order

to prevent and reduce the risk of sexual harassment in the workplace the Company has formulated the

Management Regulations on Prevention of Workplace Sexual Harassment and developed complaint channels to

encourage employees to report relevant behaviors in a timely manner. After verification the behaviors will be

graded according to the natures and severity of violations.Case

CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 74

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Trade Union Guarantee

We fully respect and safeguard employees' right to freely associate. The Trade Union of the

Company carries out independent work in strict compliance with the Trade Union Law of the

People's Republic of China and the Articles of Association of the Trade Union of China constantly

improves the democratic management mechanisms such as workers' representative conferences

and factory affairs disclosure fully protect the rights of employees to know participate and

supervise efficiently performs its basic functions in safeguarding employees' legitimate rights and

interests and build a strong communication bridge between the Company and employees.In 2025 the Company held two Workers' and Employees' Congresses completed the election of

employee directors in accordance with the law and reviewed and approved nine regulations related

to employees' vital interests. We promoted employee skills improvement training on a regular basis

enriched the forms of Trade Union membership activities comprehensively deepened the

construction of a multi-level employee care system continuously established harmonious and win- Workers' and Employees' Congress Organizing Employees to Participate on Employee Sports

win labor relations and empowered our high quality and sustainable development by protecting Meetings Held by Hunan Provincial Federation of Trade Unions

our employees' rights and interests.Talent Recruitment

Recruitment of Licensed Pharmacists

Guided by actual needs LBX Pharmacy

formulates its annual talent demand Licensed pharmacist talents are essential for stores' compliance management and

plan clarifies key positions and talent improvement of professional pharmaceutical service capabilities. The Company

portraits carries out recruitment work in attaches great importance to the introduction and cultivation of licensed pharmacist

talents. In 2025 we built 145 external licensed pharmacist communication groups

accordance with the pr inciple of

through livestreaming of licensed pharmacist recruitment flagship store open day and

openness fairness and impartiality and other activities and continuously reserved the talent pool for our key positions of

accurately and efficiently introduces licensed pharmacists.professionals from different fields

through diversified recruitment channels

and methods continuously consolidating "School-enterprise Cooperation" Projec

its talent pool and supporting its Based on the pharmaceutical and health industries the Company has carried out various

sustainable development. forms of school-enterprise cooperation such as modern apprenticeship projects co-

In 2025 driven by employer brand construction of employment internship bases and targeted talent training with 65

medical and health vocational colleges such as Hunan Traditional Chinese Medicine

building and ecological talent cultivation

Vocational College and Hunan Food and Drug Vocational College to efficiently introduce

LBX Pharmacy won a number of awards and cultivate professional talents. In 2025 we recruited and introduced more than 2000

such as "China Preferred Employer of the fresh graduates who were medical professionals.Y e a r " " T o p H u m a n R e s o u r c e s

Management Award" and "Award for the

Employer Showing the Most Love for "Home Return Plan" Project

Employees" which provided a strong

In 2025 the Company initiated the "Talent Home Return Plan". Through innovative omni-channel communication of employer brands

endorsement for the Company's practice optimization of the care mechanism for departed employees WeChat community building and provision of targeted "return"

of "talent sustainability" in the social channels 180 talents were successfully attracted to actively submit "return" applications. After strict screening 23 highly matched

dimension of ESG. talents successfully rejoined the Company effectively reducing recruitment costs and strengthening organizational resilience.Veteran Recruitment

The Company actively fulfilled its social responsibilities and continuously carried out special recruitment for veterans to provide them

with broad career development opportunities. In 2025 we recruited a total of 34 veterans to support their career transformation and

value enhancement with practical actions.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 75

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Talent Development

LBX Pharmacy attaches great importance to employees' career development and personal value realization. Adhering to the learning concept of "jointly building a learning organization and making self-improvement" we

promote the two-way upgrading of organizational learning culture and teaching culture: On the one hand we motivate our employees to "take the initiative to learn" instead of "being forced to learn" and wake up their

motivation for autonomous learning; On the other hand we advocate lecturers should "take the initiative to teach" rather than "be forced to teach" to strengthen their sense of responsibility and enthusiasm for teaching and

form a benign ecology for facilitating both teaching and learning.Training and Learning

After years of development and practice LBX Pharmacy has formed a relatively complete strategic and business-oriented talent training system. In face of current rapidly changing market and industry environment the

Company has kept on improving its overall organizational capabilities through measures such as constructing a full-cycle career management system systematically implementing training for key positions and echelons and

deepening the special training for professional talents.Training System 2025 Learning Big Data

Corporate Strategy and Talent Strategy

Top-level Coverage rate of training among all employees 100%

Design

Supporting strategy execution aligning with business needs and precise talent cultivation

Support Number of courses on the learning

Training mechanisms and digital learning platforms

System Total employee learning hours platform

Project System Operational System Content System Instructor System

Leadership & Talent Instructor

Pipeline Development Training research Learning maps

10.73 million hours 1584 courses

development

Front-line Talent high-quality InstructorTraining planning

Operational Training courses certification

System Average annual learning hours per

Professional Talent Training live-streaming Instructor Total learning participants

Development implementation programs utilization person

Instructor

Specialized Training Training case studies

evaluation incentives

992549 181 hours

New Employee Onboarding Store Assistant Learning Map Store Manager Learning Map

Guide for Frontline Staff

Commercial Area Manager Merchandise Line Procurement Line

Learning Map Learning Map Learning Map

15 Learning Logistics Line Learning Map HR Line Learning Map IT Line Learning Map

Maps Management Counter

Mentors Instructors

Operations Supervisor Group New Employee Mid to Senior Level New mentors instructors

Learning Map Learning Map Employee Learning Map

Regional Headquarters New Middle Management Senior Management 2224 774 489 960

Employee Learning Map Learning Map Learning Map

Note: The 2025 learning big data includes various types of training and learning scenarios both online and offline.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 76

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Talent Development for Functional Lines Professional Talent Development

Licensed Pharmacist Development

149 72 40 The Company has continuously strengthened the training of licensed pharmacists improved the examination assistance mechanism for licensed

pharmacists provided paid leave and full tuition reimbursement subsidies

mid to senior management

talents in key positions trained management trainees trained encouraged employees to actively participate in the national licensed

personnel trained pharmacist qualification examination and consolidated its licensed

pharmacist team. In 2025 1078 people of the Company passed the licensed

Annual Data 2025 pharmacist examination with an overall pass rate of 37.5% which was 19.81%

Talent Training for Training of Training of higher than the national pass rate.Key Positions Management Talents Management Trainees

TCM Skills Competition

The Company attaches great importance The Company continuously improves its The Company adopts the combined

The Company attaches great importance to

to the sustainable development of hierarchical and classified leadership model of "centralized training + outward

the cultivation of Chinese medicine talents

talents in key positions. In reliance upon training system. We comprehensively bound + chain rotation + store practice"

and annual ly organizes a TCM ski l ls

the special plans for "training business carry out diversified training activities to systematically forge the overall vision

competition to help first-line stores improve

acquisition echelons" and "training for B such as online learning offline training strategic thinking and cross-

their professional capabilities through online

positions" we regularly select reserve salon seminars action learning and departmental coordination capability of

learning and practical skills competitions. In

talents for key positions on a nationwide quality development in an attempt to management trainees so that they can

basis every year. In 2025 the Company build a management team with quickly grow into the backbones for the 2025 the online TCM skills training covered

cultivated 149 talents for key positions. pioneering spirit and business thinking. In Company's future management. In 2025 more than 9000 people and 2 practical

2025 the Company cultivated 72 we trained 40 management trainees. training sessions were organized offline

management talents. selecting 39 traditional Chinese medicine

experts.Altruistic Emergency Training

Frontline Talent Development

The Company systematically promotes the construction of the first aid

Frontline Reserve Talent Development capability system for employees. In 2025 we popularized first aid knowledge

for over 30000 people through our online learning platform and effectively

Frontline reserve Number of Number of Qualification improved our employees' first aid skills: The selection activity named "Looking

personnel trained qualified rate for the Most Beautiful First Aid Pioneers" is held every six months to commend

individuals individuals

employees who courageously have provided assistance in emergencies and

Store clerks 2564 2556 99.7% protected their lives with professional first aid skills so as to fully motivate all

employees to practice the "altruistic" culture and fulfill their social

Store managers 1143 1131 99.0% responsibilities.Business district

managers 92 92 100% Centralized Training Camp for Front-line Centralized Training Camp for Reserve

New Employees Store Managers

Annual Data 2025

On-the-Job Talent Development

To help frontline employees continue to grow and realize their self-

worth we graded employees in different positions and adopted

the method of "online + offline combined training and practice" to

train them. In 2025 we conducted 77 sessions of centralized

training camps and trained 3469 trainees including 63 sessions for

store managers that trained 3065 trainees;14 sessions for

business district managers that and trained 404 trainees.Centralized Training Camp for Centralized Training Camp for

Store Managers Business District ManagersContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 77

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Promotions and Performance

The Company focuses on building a fair and transparent talent development ecosystem. On the one hand we establish diversified promotion paths in three dimensions: management professionalism and skills so that

employees with different backgrounds and characteristics can match their growth directions and plan their career paths; On the other hand scientific performance appraisal standards are formulated. Openness and fairness

are integrated into the whole evaluation process. We not only guide our employees to improve their abilities with clear evaluation dimensions but also motivate them to optimize their efficiency with fair results and ultimately

achieve a win-win with individuals.Career Promotion Performance Management

The Company continuously improves its fair and smooth career development The Company has formulated and updated the Group's Performance Appraisal Management System to objectively fairly scientifically

channel and promotion mechanism. We have created the MTP career and reasonably evaluate the work performance of its departments and employees. We guide our employees to constantly improve their

development channel and the Internal Promotion Management System work efficiency and quality around the Company's operations management indicators. We not only strive to create a benign mechanism

which includes three sequences: management professionalism and skills. In with clear rewards and punishments to mobilize our employees' enthusiasm but also fully take into account our employees' actual

2025 a total of 4159 employees were promoted by the Company among situation establish a solid basic guarantee for them and lay a solid foundation for improving the overall performance of the

whom 44 employees were promoted from the middle and senior organization.management and 1190 employees were promoted from grassroots

In addition the Company pays attention to performance coaching. We specify the performance interview cycle interview format and

management.interview content in detail to ensure that our employees' work will not deviate from our strategic objectives and improve their

The Company has established a perfect qualification management system performance and long-term competence during the performance cycle. The Company uses "Salary Calculator" as a digital tool to

expanded the scope of its qualification system and identified and motivated provide "T +1" performance progress tracking for employees in front-line stores ensuring transparency efficiency and predictability of

high-potential talents more fairly and impartially. In 2025 in line with our salary accounting and effectively safeguarding the legitimate rights and interests of employees.strategies we iteratively upgraded the appointment standards for store

managers and business district managers. In addition we newly developed Performance Management System

the appointment standards for urban general managers. In 2025 a total of

more than 9000 employees participated in the certification. Among them

2396 employees were promoted to store managers; 97 employees were

promoted to business district managers and 4 employees were promoted to

urban general managers.Performance Planning 01 Performance Execution and Coaching 02

Qualification Management System

Establish annual assessment indicators and overall Perform ongoing monitoring and coaching

targets based on the Company's strategies

Regularly track progress on targets

Decompose assessment indicators and targets

Provide mid-term feedback

Position certification Determine individual performance plans

comprehensive examination

learning improvement

Learning path map

course list Performance Appraisal and Feedback 04 Application of Performance Results 03

Learning path map Professional

qualification standards Department performance summary and review Compensation incentives

Performance appraisal and result communication Promotion and development

Performance interview and improvement plan Training and development

Employee

development channelsContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 78

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Altruistic Employees

LBX Pharmacy has integrated the concept on "altruistic employees" into its daily management. We actively improve our remuneration and welfare system and build harmonious labor relations. In addition we care for our

employees' physical and mental health carry out rich cultural and sports activities and conduct employee satisfaction surveys to continuously enhance employees' sense of happiness and belonging.Fair and Competitive Remuneration

LBX Pharmacy continuously improves a fair and competitive remuneration system. We advocate the philosophy of "sharing success with achievers and sharing value with value creators". We implement a broadband remuneration

system based on qualifications and job ranks combining competence and performance. Employee remuneration covers basic salary quarterly and annual performance bonuses. Besides benefit sharing mechanisms such as

"Innovative Partner" scheme and "Red Koi" scheme are established to stimulate employees' enthusiasm and centripetal force encourage employees to grow together with us and share development results.Employee Benefits with Warmth

The Company strictly complies with national and local laws and regulations ensures timely

payment of social insurances and housing provident fund and guarantees paid leave entitlements Employee Welfare System

such as statutory holidays annual leave maternity leave paternity leave marriage and

bereavement leave breastfeeding leave and home visit leave. Additionally to enhance employees'

sense of belonging and happiness we provide commuting shuttles employee dormitories staff

cafeterias meal benefits libraries gyms and other living services. Various cultural and sports Parents Children 退Re休tirement Relaxation

activities such as family events birthday parties holiday celebrations and team-building activities

are organized. Furthermore to meet personalized needs the Company offers specific care for "LBX Star" Heart-warming holidays for college S社o会cia养l p老en保sio险n National statutory

gratitude cash entrance examinations of insurance holidays special

eligible employees or their families including rewards for certifications consolation gifts gratitude

for parents employees' children direct interview occasion leave

cash for parents incentives for children's college entrance achievements and a multi-million free employment guidance and benefits

hardship assistance fund for difficulties. Additional supplemental insurance coverage like accidental holiday internship

injury and critical illness insurance is provided for employees in specialized positions.

2025 Employee Maternity (Paternity) Leave Information

Orientation Illness Health Protection

Orientation guide Condolence Health lectures Multi-million hardship assistance

Number of employees who actually Number of employees who returned to wor
k new employee money paid sick first aid training fund employee group accident

took (paternity) maternity leave after (paternity) maternity leave essentials leave summer cooling insurancework injury insurance

activities basic medical insurance

1019 997 Life Improvement Marriage House purchase

Free employee Licensed pharmacist New marriage Housing

female employees female employees dormitories staff certification cash gift provident fund

canteens shuttle buses allowance wedding leave

84 84 library gym KTV

male employees male employees

Funeral Childbirth

Number of female employees who Number of female employees who returned to Condolence cash gift for Childbirth cash gift paternity

actually took (paternity) maternity leave work after (paternity) maternity leave employees or immediate leave maternity/breastfeeding

family funerals leave maternity insurance

Number of male employees who Number of male employees who returned to work

actually took (paternity) maternity leave after (paternity) maternity leaveContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 79

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Employee Aid Program Recognition of "LBX Stars"

In 2025 the Company continuously promoted the smooth In 2025 the Company organized a selection campaign named "LBX Stars" and

implementation of the "Multi-Million Hardship Assistance Fund" finally selected 110 outstanding employees. We held a grand award ceremony on

and provided timely assistance to employees and families who 27 October. In addition to recognizing the award-winning employees the Company

were in difficulties and urgently needed assistance. During the year also attached great importance to caring for our employees' families and the

the "Multi-Million Hardship Assistance Fund" supported 90 parents of employees who were awarded the "LBX Stars" received exclusive family

employees' families with a total amount of RMB 1823780. In gratitude gifts.addition to personal medical insurance commercial insurance and

other reimbursements for employees (and their families) who

encountered major illnesses we also provided self-paid

reimbursement support for employees with a maximum

reimbursement ratio of 60%. In 2025 our maximum assistance

amount for a single employee was up to RMB 48320.Comfortable Work Environment

Number of employees assisted

We make unremitting efforts to create a healthy safe and humane working

environment for our employees and constantly upgrade the spaces and facilities of

90 our office premises. While ensuring that the basic environment is spacious bright and

ventilated we actively improve the living facilities in the park equipping multi-

functional spaces such as rest areas gymnasiums reading rooms basketball courts

yoga rooms and KTV to enrich our employees' amateur life.In 2025 we further optimized our employee experience and living facilities: We

Total assistance amount

opened a new 1200m2 indoor employee sports venue in the office park of our Library KTV

headquarters launched an exclusive VIP room for mommies and mounted a boiler

system to ensure hot water supply in winter so as to effectively satisfy the living

RMB 1823780 needs of our employees. The park was additionally equipped with 120 electric vehicle

charging interfaces and electric vehicle awnings to facilitate green commuting. In

addition the park introduced well-known brands such as Luckin Coffee and Ningji to

provide employees with more high-quality and convenient dining and living options.We are committed to creating a more dynamic and warm working atmosphere

through continuous improvement of details."Benefiting" Employee's Children's Program Gym Yoga Room

In 2025 the Company continuously optimized the "Benefiting"

Employee's Children's Program: On the one hand we launched a

warm-hearted holiday for children to take the college entrance

Renovating and Upgrading Dining Areas with "Ten Altruistic

examination and enter the university and accurately matched the

exam leave and school leave for a total of 124 employees so as to Actions"

ensure that employees could accompany their children to take the In 2025 LBX Pharmacy continuously promoted "ten altruistic

college entrance examination and enter the university through actions". Among them for altruistic employees we tailor-made

flexible holidays; On the other hand focusing on children's dining areas according to the actual store space provided dining

employment needs by performing services in three dimensions: supplies and facilities such as tables and chairs microwave ovens

"employment assistance and guidance + enterprise interview and mini-refrigerators and improved the dining environment. In

through train + holiday internship supply" we built a transition 2025 we gradually completed the renovation of dining areas in

bridge from campus to workplace for employees' children and over 1000 stores.convey our care.CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 80

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Employee Satisfaction Survey Premises Safety

The Company places great emphasis on enhancing employee satisfaction continuously listens to employees' opinions and ensures fluent In the park of the Group's headquarters and business premises of

communication channels. Each year we conduct regular employee satisfaction surveys in our subsidiaries and national stores aiming to strengthen the headquarters and stores of all subsidiaries we fully perform fire

our employees' team spirit and sense of belonging. safety management reasonably allocate firefighting equipment

and regularly maintain them. The Engineering Department of the

In 2025 the Company conducted a survey on the satisfaction with "wall demolition" among its subsidiaries and Group departments in the first half of

Group's headquarters conducts spot inspections of firefighting

the year and a total of two surveys throughout the year. Employee satisfaction surveys in stores nationwide were conducted on a quarterly basis

facilities in the office areas of subsidiaries nationwide on a

with a total of four surveys throughout the year. Among them a total of 120164 employee satisfaction questionnaires were distributed and 39465

quarterly basis. In addition before important holidays such as May

were collected with an employee participation rate of 32.84%. The overall employee satisfaction slightly increased compared with previous year

Day November 11 and Spring Festival special safety inspections

with an increase of 2.6% in the fourth quarter.are organized to comprehensively investigate hidden dangers and

ensure the safety and reliability of offices and business premises.Occupational Health and Safety In 2025 based on the equipment testing and evaluation results the

park in the Group's headquarters systematically completed the

LBX Pharmacy attaches great importance to the health and safety of employees strictly follows the requirements of relevant laws and regulations renewal plan for firefighting equipment and replaced 1162 sets of

including the Work Safety Law of the People's Republic of China and the Law of the People's Republic of China on the Prevention and Control of equipment in total including 4kg dry powder fire extinguishers 3kg

Occupational Diseases. We have established and continuously improved our safety management and occupational health management systems to carbon dioxide fire extinguishers and 35kg trolley fire extinguishers

protect the health and safety of our employees. We carry out regular safety risk assessment and emergency drills to enhance our employees' safety where approximately RMB 60000 was specially invested. In

awareness and ability to respond to emergencies. In 2025 the Company did not have any major safety accidents throughout the year. addition nearly RMB 60000 was annually invested in professional

systematic fire maintenance to ensure that all fire protection

Safety System facilities were immediately usable.To build a strong line of safety defense the Company has established a systematic safety governance structure and responsibility system and a fire To protect employees' health and work safety we entrust

safety management committee. We have formulated a series of regulations and systems including the Work Safety Management System the Fire professional third-party organizations to conduct regular safety

Safety Management System and the Group's Logistics Safety Accident Management System. In accordance with the principles of "territorial inspections on drinking water quality elevators and other facilities

management" and "safety responsibility" all subsidiaries of the Company have established and improved their emergency management in our office areas and issue formal inspection reports to ensure

mechanisms signed the Fire Safety Objective Responsibility Statement level by level and incorporated the performance into normal supervision and that all facilities meet safe use standards. In October 2025 the

performance appraisal forming a complete management closed loop of "deployment - commitment - execution - appraisal". Company hired a professional third par ty to carry out

Architecture of the Fire Safety Management Committee comprehensive cleaning and disinfection of a secondary water

supply system in the park where its headquarters was located and

conducted sampling and testing of the terminal water. The results

conformed to the standards. In September all elevators in the park

Team leader

underwent the annual inspection and maintained good operating

conditions. Besides we have equipped first aid kits and AEDs in the

Vice president in charge park to enhance our professional rescue capabilities in the event of

emergencies.Regarding safety management of our logistics centers we have

built a full-time safety protection team to perform daily safety

Secretary general Vice team leaders Team members

inspections. We strictly implement the Detailed Management Rules

for Personnel Entry and Exit of Logistics Centers separate the flow

Engineering construction Secretary of the Party Committee Primary persons in charge of of people from logistics channels and strengthen access control

director all theaters/innovation management. In 2025 we comprehensively reviewed and

companies/supply chain

Minister of the Construction Management Group upgraded the video surveillance system of the national warehouse regions

Specialists network installed an access control alarm system and realized

centralized monitoring in the Group. Through systematic

General manager of the Logistics Operation Center management and control no safety accidents occurred in our

logistics centers throughout the year effectively ensuring the safety

Administrative director and stability of warehousing operation.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 81

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Occupational Health and Safety Indicators and Targets

The Company attaches great importance to the occupational health of employees and strictly follows the relevant requirements

of laws and regulations including the Law on the Prevention and Control of Occupational Diseases the Administrative Measures

for Occupational Health Examination and the Good Manufacturing Practice for Drugs. We regularly organize our employees to

Signing rate of electronic labor contracts

participate in health examinations conduct regular occupational health training enhance our employees' health awareness and

ensure that our employees' health and working environment meet occupational health standards. In addition we regularly

organize personnel in direct contact with pharmaceutical positions such as quality management acceptance maintenance and

storage to conduct pre-job and annual health checks and maintain health records. 100 %

In addition the Company continuously increases its investments in systematically constructing a comprehensive employee health

support system: By building new comprehensive indoor bodybuilding venues and upgrading professional bodybuilding

equipment we encourage our employees to strengthen physical exercises. We establish TCM clinics and special health care for

our employees. We also innovatively launch the "TCM Diet Day" in the canteens to promote the diet and health culture and Achievements in 2025

effectively protect our employees' physical and mental well-being.Work-related Injury Management

We purchase work-related injury insurance for all our employees. The Company strictly executes the reporting and handling

process for work-related injuries. In the event of work-related injuries emergency plans will be immediately activated to ensure Coverage rate of training among all employees

that the injured employees will receive timely medical attention and applications for recognition of work-related injuries will be

submitted in accordance with legal requirements to protect the legitimate rights and interests of employees. Furthermore we

conduct thorough investigations into all work-related injury incidents to analyze the root causes and take targeted corrective

measures to prevent recurrence. 100 %

Creation of Safety Cultures Achievements in 2025

We actively coordinate external professional resources to organize fire evacuation drills practical training on firefighting

equipment emergency rescue drills for elevator accidents and first aid training for employees in order to continuously enhance

our employees' safety awareness and emergency response skills. We also launch safety courses on the Company's self-developed

"Baixingtong" an employee platform requiring all employees to study and pass examinations continuously strengthening

employees' safety awareness and creating a good atmosphere where "everyone learns about safety and knows about safety".

0

major and more serious safety incidents

No occurrence in 2025

Fire Safety DrillContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 82

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Responsible Citizens

Be healthy and positive making concerted efforts to be better. LBX Pharmacy has always taken steadfast actions to improve people's livelihood and protect people's health. We have supported rural revitalization through

agricultural industry assistance and infrastructure construction. We have built "health stations" in tens of thousands of stores across the country and carried out a variety of charitable donations and special group care public

welfare activities with ecological partners We have continuously organized "journeys to healthy communities" to improve grassroots medicine and health so as to contribute to the promotion of "common prosperity" and the

construction of a healthy China.Rural Revitalization

Industrial revitalization is an important part of rural revitalization. LBX Pharmacy gives full play to its own industrial advantages to support the development of the rural pharmaceutical retail industry and the improvement of

medical conditions through the franchising the main model and paired assistance. We support the rural pharmaceutical retail industry to increase income and profits by empowering their procurement of traditional Chinese

medicines and e-commerce and comprehensively promote the construction of beautiful rural areas.Facilitating the Development of the Continuous Improvement of Rural Health Conditions

Pharmaceutical Retail Industry in Lower-tier

We have continuously responded to the "paired assistance" work and supported the improvement of rural health conditions. On August 4

Markets through Franchising 2025 the Company donated medical materials worthy of RMB 250000 to Fengning Manchu Autonomous County Hebei Province to

Continuously taking franchising business as the "main force" for serving support the construction of 12 rural clinics in the county. Fengning County is the key contact county under the impaired assistance of China

the health of people in counties and towns we extend our mature brands Democratic National Construction Association. As a member enterprise of Hunan Democratic Construction Association LBX Pharmacy has

supply chain resources operating system and compliance management supported the construction of rural clinics in Fengning County for five consecutive years and the cumulative value of donated materials

experience to rural pharmaceutical markets through our standardized has exceeded RMB 1.2 million.franchising model to effectively settle the dilemma of the rural

pharmaceutical retail industry which is "scattered small and weak". This

initiative not only directly creates rural entrepreneurship and employment Promoting Sales of Agricultural Rural Areas' and Farmers' Products

opportunities but also further promotes the availability of high-quality Actively aiming at "agriculture support and revitalization" we have procured characteristic landmark products such as Qinghai fresh

medical and health resources so that rural residents can easily access cordyceps Zhaotong fresh gastrodia elata and Yanling yellow peach out of the mountains through e-commerce in our mini program to help

affordable and safe medicines and health services. This also facilitate the farmers broaden their sales channels. In 2025 our e-commerce platform facilitated the sales of agricultural products exceeding RMB 5.8

construction of a sustainable rural pharmaceutical retail ecosystem. million. YST Pharma our production factory of traditional Chinese decoction pieces strongly supports the rural traditional Chinese herbal

medicine planting industry. On the premise of assuring the quality and authenticity of the traditional Chinese herbal medicine 90% of the raw

materials purchased by YST Pharma in 2025 came from farmers' products planted harvested and processed of which raw traditional

5243 Chinese herbal medicines of more than RMB 10 million were purchased directly from farmers' cooperatives in the production areas.

franchised stores nationwide E-commerce Empowering Gastrodia Elata Sales in Xiaocaoba Town

Yiliang County Yunnan Province

In 2025 we provided targeted assistance in Xiaocaoba Town Yiliang County Yunnan

Province and built an "online empowerment + source traceability" model to promote

15000+ Xiaocaoba gastrodia elata with local characteristics all over the country enhanced

the brand awareness of Xiaocaoba gastrodia elata and supported local industry

development and steadily increased farmers' income.entrepreneurship and employment opportunities

provided

Data as of the end of 2025

CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 83

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Social Contributions

Having always integrated social responsibility into its corporate development LBX Pharmacy actively pays attention to the social needs in its place of business. From building "health stations" all over the communities to

disaster relief charitable donations and caring for special groups at critical moments we have always stood on the front line of public welfare let warmth and love infiltrate people's hearts help people improve their

livelihood and enhance social well-being.Health Stations

As an important part of the national health system the state

strongly encourages pharmacies to transform from traditional Opening "Love Stations" in Tens of Thousands of Stores Nationwide

drug retailers to comprehensive "health service centers". As a

head chain LBX Pharmacy always adheres to the concept of In 2025 we established "love stations" in 10000 stores across

"serving ordinary people prioritizing health". We have the country. As the first chain enterprise in China that built 10000

continuously improved grassroots medical and health services "love stations" LBX Pharmacy owned numerous standardized

through convenience pharmacy service stations community stations with a wide coverage and acted as a positive model for

enterprises to serve grassroots people's livelihood widely

health journeys love stations public welfare brand activities

recognized by the government authorities at varying levels

etc. and actively built trustworthy "health stations" around

mainstream media and the public.residents.All "love stations" of LBX Pharmacy are uniformly marked and

equipped with equipment. They provide six free convenience

services for outdoor workers and citizens including "rest seats

free tea emergency charging of mobile phones microwave

oven use free self-measurement of body temperature/blood

pressure and free debridement". The station services are also

connected to rider bags of the take-out platform and Amap.Health Professional Besides some stores also make their convenient restrooms open

products pharmaceu- and provide "aging-friendly" services making the small "love

tical affairs

stations" be warm harbors around new employment groups and LBX Pharmacy's "Love Stations" Were Praised by Authoritative Media Including

community residents. People's Daily and CCTV News

Aging- Chronic

friendly disease

silver hair manage-

services HEALTH ment

STATIONS OF

18012 Activities Named "Community Health Journey" Performed Nationwide

Emergency In order to enhance the masses' awareness of scientific and safe

Health

supply drug use and improve the quality of their healthy life in 2025 we

guidance

guarantee visited 10000 communities across the country and performed a

total of 18012 public welfare activities known as "Community

Health Journey" in our direct-sale stores. The activities included

Convenience

Health providing community residents with services such as free health services

of love education self-examination/testing reasonable medication consultation

stations popularization of chronic disease knowledge family medkit

sorting and recycling of expired drugs so as to deliver health

care with professionalism and warmth and help build healthy

communities.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 84

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Construction of Convenient Pharmaceutical Service Stations Charity and Public Welfare

In 2025 we actively responded to the deployment and call of the local government for In 2025 we cumulatively made charitable and public welfare donations of RMB 13.4635 Million to the society. In

building "convenient pharmaceutical service stations" and opening up the "last mile" of addition LBX Pharmacy was listed as influential in Changsha Fifth (2024) "Changsha Charity List" for its positive

health services. In Changzhou Jiangsu Province Heping Road Store and Sun City Store contributions to charity.of LBX Wanren Pharmacy have become pharmaceutical "medicine" safety service

stations licensed by Changzhou Administration for Market Regulation Jiangsu Province

providing 23 pharmaceutical services including free medication guidance medication Flood Relief in Guizhou and Shaanxi

consultation door-to-door medication delivery and health consultation for community. In July 2025 a flood happened in Rongjiang County Guizhou Province. The Guizhou Company of LBX

The stations annually carry out 35 special activities and serve more than 20000 people Health Pharmacy took quick actions and jointly allocated materials such as heat-clearing detoxification

in total becoming intimate "health stations" around community residents. In Hefei antibacterial anti-inflammatory and stroke prevention drugs with supplier partners. The total value of

Anhui Province LBX Pharmacy entered into assistance agreements with four the materials was RMB 540000 fully guaranteeing the health needs of the affected people.communities in Baiyan Center Hefei City and professional pharmacists came to provide

home pharmaceutical services for the elderly living alone and the elderly with chronic

diseases under its jurisdiction so as to protect the life and health of the elderly.In August 2025 Yuzhong and other places in Lanzhou

Gansu Province suffered from continuous heavy rainfalls

causing severe mountain torrents. LBX HRT Pharmacy

together with its supplier partners jointly allocated

materials with a total value of more than RMB 500000

(covering medicine daily necessities food etc.) to

support the disaster areas immediately effectively

Public Welfare Clinics meeting the urgent needs of the affected people in terms

BXT Pharma a traditional Chinese medicine clinic affiliated to the Group has of daily necessities food security medical care and

continuously carried out free public welfare clinics on a regular basis. In 2025 it epidemic prevention.organized a total of 130 free clinics in enterprises campuses and communities. The

activities included health lectures free health tests traditional Chinese medicine-based

health consultation and other services. The free clinics visits cumulatively received more

than 3000 people and the publicity covered 30000 people.Caring for Special Groups

Support for Education

In April 2025 the Guangxi Company of LBX Pharmacy

and D-cal carried out the charitable donation activity

known as "Height Advancement Plan for Chinese

Children" and donated sports equipment and calcium

products for children to local schools in Dahua Yao

Autonomous County Guangxi aiming at creating better

exercise conditions for children and providing necessary

nutritional support.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 85

Quality Control Supply Chain Safety Health Services Innovation-driven Employee Development Responsible Citizens

Dissemination of the "Healing" Culture

Caring for Special Groups

As an active practitioner of the "Healthy China" strategy LBX Pharmacy has always taken "healing" and "altruism" as its core value anchors committed to building

Care for Outdoor Workers a warmer and healthy living ecology for people. We have continuously carried out colorful brand cultural activities and multi-channel health science

popularization and actively supported the cultural health activities for communities so as to support the construction of a "Healthy China" with practical actions.In July 2025 Hunan Party Branch of LBX

Pharmacy joined hands with the Party Group

of Kaifu District Medical Insurance Bureau of Innovative Brand Culture Activities

Changsha to carry out the condolence

In 2025 our headquarters organized a total of 13 large-scale brand culture activities. Relying on our diversified communication strategies with "in-depth coverage

activity named "Medical Services for Cooling of all online platforms + precise penetration of offline scenarios" we had our brands exposed for more than 7.1 billion times throughout the year making

the Summer" conveying summer cooling accessible to and popularizing scientific health knowledge among high-frequency and multi-dimensional users and integrating the concept of healthy healing

comfort and health care to outdoor workers into every corner of people's healthy life.such as frontline sanitation and garden

workers. The materials donated were worthy

of RMB 20000 in total.Stores' Health Training Camp Named

Metro "Emotional Transition Station" Providing Citizens with a Emotional Release Space and a Scientific Stress Relief Program

“Healthy Illustration · Juvenile Role Models' Journey”

Creation of an Omni-channel Health Science Support for Performance of Mass Cultural And Health Activities

Popularization Matrix We actively advocate the concept of healthy living and encourage mass cultural events.We have always focused on the pain points of public health In 2025 we supported Changsha Xiangjiang Marathon Nanning Marathon Xi'an

awareness and all life scenarios and created a health science Marathon and other events providing free health supplies for participants setting up

Support for the Army and Patriotism popularization matrix. In 2025 the Company created a total of emergency medical supply points along the routes and arranging professionals to

12 healthy life science popularization columns deeply conduct health consultations. We also extensively organized and carried out various

In July 2025 Guangxi Company of LBX integrating core contents such as health knowledge mass cultural activities such as mountaineering walking community square dance

Pharmacy donated heatstroke prevention popularization guidance for chronic disease management karaoke sports meetings etc. to inject fresh energy into communities.materials worthy of RMB 100000 to officers and interpretation of the medical insurance policy to form a

and soldiers of local training and combat health service ecology covering the whole population with

troops and performed the responsibilities over 264 million exposures in aggregate helping all people

for supporting the army and patriotism with improve their health literacy.practical actions.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 86

04 Environmental

LBX Pharmacy has deeply integrated the green and low-

carbon concept into the whole process of its business

growth. By continuously strengthening pollution emission

control building a clean and low-carbon energy system and

advocating a green and healthy lifestyle we have promoted

the green transformation of the pharmaceutical retail

industry with practical actions and helped build a wonderful

world where the mankind and nature coexist harmoniously.Contents of This Section

Environmental Compliance Management

Addressing Climate Change

Use of Energies and Resources

Green OperationContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 87

Environmental Compliance Management Addressing Climate Change Use of Energies and Resources Green Operation

Environmental Compliance Management

Environmental Management

Governance Risk Management Objectives and Indicators

In strict compliance with the Environmental Protection Law of the The Company attaches great importance to prevention and control of

People's Republic of China and the Law of the People's Republic of environmental risks and continuously improves its abilities to control of

China on Environmental Impact Assessment LBX Pharmacy environmental emergencies and make emergency responses. In view of

continuously builds and improves its environmental management specific environmental risks such as leakage of chemicals leakage and

system during production and operation and assigns environmental hazardous wastes YST Pharma has prepared the Emergency Plan for 0

management responsibilities to relevant functional departments Hazardous Wastes and the Emergency Plan for Production Safety

based on its business natures. In 2025 the Company's investments in Incidents classified all kinds of possible emergencies defined the Environment-related violations during

environmental protection totaled RMB 1065900. emergency rescue team and responsibilities equipped emergency

the reporting period

In the logistics and office parks the Company has established an facilities and conducted regular emergency drills to effectively ensure

environmental management system for parks covering planning emergency responses to emergencies.design construction operation and maintenance where the park

planning and engineering construction are managed by the Achievements in 2025

Engineering Construction Department and the daily environmental Strategic and Management Initiatives

management of park offices is performed by the Administrative

Regarding environmental compliance as the core foundation for green

Department. The headquarters of the Company has formulated the

and sustainable development the Company adheres to the environmental

Group's Environmental Management System for offices. This system

management principle of "carbon reduction recycling and co-

clearly defines the management responsibilities of the Group's

governance" strictly controls key links such as energy consumption

Department of Administrative Services relevant departments of each

indicators pollutant emissions and waste disposal in the production and

subsidiary and other business departments. It establishes

operation process and continuously improves its standardized

comprehensive and detailed standards ranging from site selection for

environmental management. We also continuously publicize the

offices change and facility configuration to use specifications for

awareness of environmental protection in our daily work and constantly

office areas and public area management etc. A supervision and

enhance all our employees' emphasis on environmental protection work.assessment mechanism that combines self-inspection with inspection

at the headquarters of the Group has been established so as to

provide systematic and complete compliance guidelines for the

Company's office environment management.During the production YST Pharma a manufacturer of traditional

Chinese medicine decoction pieces affiliated to the Company has

formulated the Environmental Sanitation Management System

established an Environmental Management Committee with the

general manager as the core leader set up special departments and

appointed full-time personnel for environmental sanitation

management clarified environmental management responsibilities of

other departments at varying levels and earnestly done a good job in

environmental management in the course of production and

operation.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 88

Environmental Compliance Management Addressing Climate Change Use of Energies and Resources Green Operation

Emissions and Waste Management

LBX Pharmacy strictly abides by the Water Pollution Prevention and Control Law of the People's Republic of China the Air Pollution Prevention and Control Law of the People's Republic of China the Law of the People's Republic of

China on the Prevention and Control of Environment Pollution Caused by Solid Wastes and other laws and regulations. According to the principle of "source control efficient collection and scientific treatment" it has established a

full-chain emission control system regularly monitored pollutant discharge continuously reduced pollutant discharge and mitigated negative impacts on the environment.Wastewater Sewage and

Specific treatment measures

wastewater type

In 2025 the wastewater of the Company was mainly domestic sewage BXT Pharma medical sewage

and YST Pharma production wastewater. The wastewater discharge rate was 100% and no direct

sewage discharge into natural water bodies occurred. Discharged into the urban domestic sewage treatment pipeline.Domestic sewage

The sewage discharge of YST Pharma in 2025 is as follows:

Formulate the Sewage Treatment System and regularly conduct internal and

Wastewater type Unit 2025 external inspections of the master sewage outlet. After all kinds of sewage and

wastewater in the factory area are treated by septic tanks grease traps sump pits

Total wastewater discharge ton 13842 Production equalization tanks and other sewage treatment facilities up to standards they will

wastewater be conveyed to Changsha Changshanyuan Sewage Treatment Plant through the

(YST Pharma)

Total chemical oxygen demand (COD) emissions ton 0.24 sewage pipeline of the park.Discharge of suspended solids (SS) ton 0.37 BXT Pharma has established the "Sewage Disinfection Management System" and

equipped with automatic medical sewage disinfection devices to ensure

Medical sewage

Ammonia nitrogen emissions ton 0.09 compliance before discharging into the municipal network.(BXT Pharma)

Waste Gas

The Company's waste gas mainly comes from YST Pharma's boiler waste gas and production dust.Among them the boilers are natural gas boilers. Natural gas is clean energy and the concentration of Special Cleaning of Smoke Exhaust Pipes by YST Pharma

pollutants in the discharged gas fume is low. The boiler waste gas is treated by a waste gas treatment From March to April 2025 YST Pharma focused on the demand for

device to obtain clean gas and then enters a 15m chimney for direct discharge. YST Pharma is cleaning smoke exhaust pipes in the medicine frying rooms of the

equipped with exhaust fans and baghouse dust collectors. After treatment the production dust is production workshops and hired a professional third-party

discharged by 15m exhaust pipe up to standard. Besides the production lines of YST Pharma use fully organization to carry out special cleaning work. In view of the

automatic dust removal and recovery units and environmentally friendly inkjet coding technology to characteristics of the pipelines where dust accumulated in the

reduce the amount of waste gas generated from the sources and protect the working environment. workshops the working team performed fine cleaning through

professional processes such as high-pressure cleaning and oil-

stain separation to thoroughly remove oil and impurities from the

pipelines. After cleaning the smoke exhaust efficiency and heat

Category of boiler waste gas Unit 2025 dissipation capacity of the smoke exhaust pipelines were

significantly improved which not only reduced the energy

Nitrogen oxides/NOx ton 0.32 consumption of equipment and pollutant residues but also

eliminated hidden fire hazards of the fume pipelines.CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 89

Environmental Compliance Management Addressing Climate Change Use of Energies and Resources Green Operation

Solid Waste

Most of the Company's solid waste is domestic waste in addition to a small amount of construction waste general industrial waste and hazardous waste. The solid waste treatment follows the principle of "reduction resource

utilization and harmlessness treatment". All kinds of solid waste are collected by classification. Active efforts are made to explore source reduction and recycling to build an industrial ecology and circular economy system. In

addition the Company has formulated the Group's Operation Management System for Realizable Waste to standardize the management of realizable waste in distribution centers clarify the rights and responsibilities as well as

requirements for contractor introduction management supervision and assessment.Solid waste emissions (including Changsha headquarters par BXT Pharma and YST Type of Solid Waste Specific treatment measures

Pharma) of the Company in 2025 are as follows:

Conduct routine "waste sorting" establish household waste collection points collect

Category of solid waste Unit 2025 household waste at fixed intervals and locations and use specialized enclosed

waste transportation vehicles for disposal. Kitchen waste is uniformly reclaimed by

Domestic Waste

Total non-hazardous wastes ton 671.00 the municipal kitchen waste center.Non-hazardous waste density ton/RMB million 0.03

Develop and implement a construction site waste management plan classify waste

on-site separate recyclable construction waste and either directly reuse it in the

Total hazardous waste ton 176.12 Construction Waste construction process or deliver it to recycling manufacturers for reprocessing.Hazardous waste density ton/RMB million 0.01

Expired drugs in logistics centers: In strict compliance with the relevant laws and

regulations on the legal disposal of expired drugs formulate the Group's Operating

Total solid waste emissions ton 847.12

Procedures for Logistics Substandard Products and Destruction. Regularly check the

shelf life of drugs and implement risk assessment and control as well as hidden

danger investigation and management during the disposal process. Ensure that

expired drugs are managed in place and properly handled. In 2025 the Company's

logistics distribution center handed over 174.86 tons of expired drugs to

professional environmental protection companies for destruction.Hazardous Waste Hazardous waste from the production of traditional Chinese medicine decoction

pieces: YST Pharma adopts the post responsibility system for special hazardous

wastes warehouse management personnel builds a leading group for prevention

and control of hazardous waste pollution led by its general manager strictly

controls hazardous waste throughout the process of their generation storage

transportation and disposal and entrusts qualified third-party organizations to

dispose of hazardous waste to ensure their safe and compliant disposal.BXT Pharma has developed the Medical Waste Management System and the

Hazardous Waste Management System to clearly classify medical waste with proper

labeling and the use of yellow bags with warning labels. It requires the completion

of tripartite documentation for the transfer of medical waste (within 48 hours of

Medical Waste

collection) and mandates that the temporary medical waste storage site strictly

adhere to specialized operational guidelines.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 90

Environmental Compliance Management Addressing Climate Change Use of Energies and Resources Green Operation

Addressing Climate Change

LBX Pharmacy proactively responds to climate change and actively identifies the issues for "addressing climate change". It takes targeted response measures in combination with internal and external environmental changes to

enhance its climate resilience in its own operations and value chain and facilitate green low-carbon sustainable development.Risk Management

The impacts of climate change on the Company mainly include physical risks such as interruption or delay of drug supply and damage to goods caused by extreme weather as well as transition risks such as strict policy

supervision and consumers' increased environmental awareness. Risks often arise with opportunities. For instance by adopting environmental protection measures and using clean energies the Company's reputation and market

competitiveness can be effectively enhanced. In assessing the risks and opportunities associated with climate change LBX Pharmacy selected the low emission scenario (SSP1-2.6 temperature rise not exceeding 2.0℃) and the

high emission scenario (SSP5-8.5 temperature rise close to or exceeding 4.4℃) in the shared socio-economic pathway (SSP) scenario in the AR6 Synthesis Report: Climate Change 2023 of the United Nations Intergovernmental

Panel on Climate Change (IPCC) to assess the physical risks. Based on the "Net Zero Emissions by 2050 Scenario (NZE temperature rise not exceeding 1.5℃)" and the "Stated Policy Scenario (STEPS temperature rise exceeding 3℃)"

to assess the transition risks and climate-related opportunities.Risk and Impact analysis under different climate scenarios

opportunity Impact pathway Financial impact Countermeasures

Short- Medium- Long- Short- Medium- Long-

classification term term term term term term

Physical risks SSP1-2.6 SSP5-8.5

Strengthen meteorological monitoring and warning to promptly notify all

subsidiaries of extreme weather disasters reserve emergency supplies in

advance and deploy emergency equipment including adding a central

heating hot water tank (20m3) for low-temperature weather and purchasing

The occurrence of extreme Increased operating industrial salt and non-slip cloth bags for rainy and snowy days;

weather such as earthquakes costs for equipment

typhoons thunderstorms and maintenance and Promote the diversification of suppliers deploy substitute suppliers in

heavy fog might disrupt or employee health advance formulate transportation emergency plans adjust transportation

obstruct transportation make and safety etc. strategies in a timely manner and ensure commodity supply;Acute risks High High High High High High

product delivery challenging reduced revenue Develop contingency plans for extreme weather and organize periodic

decreasing employees' work and asset training or emergency drills for employees to better prepare for such

efficiency damage infrastructure impairment losses conditions;

and so on. resulting from

restricted Formulate seasonal construction assurance measures based on the climatic

transportation characteristics of each season and consider how to respond to extreme

weather during the design phase;

Carry out daily infrastructure maintenance and install lightning rods and

grounding devices in parks and factories to protect buildings and facilities.Chronic risks such as extreme Increased

high temperatures droughts operational costs

rising sea levels and intensified Improve energy use efficiency adjust energy use structure and expand the

El Ni?o phenomena impact the proportion of renewable energy used;

Chronic risks health and safety of employees Low Medium Medium Medium High High

potentially increasing costs Enhance the insulation capability of buildings such as adding insulating

associated with utilities materials to cope with extreme cold or scorching hot weather.equipment wear and overall

operational expenses.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 91

Environmental Compliance Management Addressing Climate Change Use of Energies and Resources Green Operation

Transition Risks and Climate-related Opportunities NZE STEPS

The government's introduction of policies

Pay close attention to policy changes comply with laws and

supporting low-carbon transition and stricter

Increased regulations and ensure legal and compliant operations;Policy risks emission reduction measures may increase Low Medium Medium Low Low Low

costs for green operations or carbon trading operational costs Continue to explore and innovate sustainable operational

costs of the company. models.Suppliers might face increased operational

costs due to carbon reduction policies leading

Market risks to a rise in raw material prices and a Profit margins Strengthen the ability to respond to supply chain risks and

subsequent decline in the Company's profit declined build a sustainable supply chain.Medium Medium High Low Low Medium

margins.Stakeholders are increasingly concerned about

the company's performance in addressing

climate change. Without proactive climate Proactively respond to stakeholders' concerns regarding the

action the company might fail to meet Revenue decline

Reputational Company's climate-related actions improve performance Medium Medium High Low Low Medium

stakeholders' expectations potentially leading

risks and enhance information transparency.to damage to the company's image and

reputation.The company needs to enhance the energy

efficiency standards of its operational

equipment due to the implementation of Increased Continuously monitor environmental policies and implement

Technological Low Medium High Low Medium Mediumstricter environmental policies by the operational costs timely environmental upgrades in line with the company's

risks government which may require additional actual circumstances.investments for energy-saving and

environmental protection upgrades.Consumers tend to choose environmentally

friendly products and services. The Company's

Reputation initiatives in low-carbon and environmental Increased revenue Keep paying attention to and actively participate in climate

Low Medium Medium Medium High High

opportunities protection help enhance consumers' trust and actions; build a good brand image.recognition.Through technology R&D process

optimization and management upgrades the Conduct timely production technology R&D and iterations in

Technological company comprehensively identifies and Lower operating Low Medium High Medium Medium Highalignment with the Company's overall strategy and

opportunities explore technological opportunities to costs operational conditions.improve operational efficiency.Notes 1. Time dimension: Identified potential impacts of climate change on its business segments across short-term medium-term and long-term time scales;

2. Degree of impact: Using a qualitative assessment to rank those identified risks as 'low' 'medium' or 'high' based on the probability of occurrence impact adaptability and resilience.Contents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 92

Environmental Compliance Management Addressing Climate Change Use of Energies and Resources Green Operation

Greenhouse Gas Emissions

The greenhouse gas emissions of LBX Pharmacy mainly come from the consumption of electricity natural gas gasoline diesel

and other energy sources. Among them the use of natural gas and fuel oil is included in Scope 1 greenhouse gas emissions

namely direct greenhouse gas emissions and purchased electricity is included in Scope 2 greenhouse gas emissions namely The total greenhouse gas emissions in 2025

indirect greenhouse gas emissions. The greenhouse gas emission data are presented in terms of carbon dioxide equivalent.declined on a year-on-year basis by

9.28%

The relevant data on the Company's greenhouse gas emissions for 2025 is as follows:

Category Unit 2025

Total greenhouse gas emissions (Scope 1) tCO?e 1006.49

Total greenhouse gas emissions (Scope 2) tCO?e 66736.34

Total greenhouse gas emissions (Scope 1 + Scope 2) tCO?e 67742.83

Greenhouse gas emission intensity (Scope 1 + Scope 2) tCO2e/RMB million 3.05

1. The greenhouse gas emissions list includes carbon dioxide methane nitrogen oxides hydrofluorocarbons perfluorocarbons sulfur

hexafluoride and nitrogen trifluoride.

2. The electricity emission factor is derived from the average emission factor of the power grid all over China 0.5306 t CO2/MWH as

2

specified in the Announcement on the 2023 Electricity Carbon Dioxide Emission Factors published by the Ministry of Ecology and

Environment in 2025.

3. Other calculations are based on the national standard of the People's Republic of China "General Rules for Calculation of Comprehensive

Energy Consumption (GB/T 2589-2020)" the Global Warming Potential (GWP) values from the AR6 Synthesis Report: Climate Change of

Intergovernmental Panel on Climate Change (IPCC AR6) and the "IPCC 2006 Guidelines for National Greenhouse Gas Inventories (2019

Revision)."

NotesContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 93

Environmental Compliance Management Addressing Climate Change Use of Energies and Resources Green Operation

Use of Energies and Resources

Governance Strategic and Management Initiatives

The Company advocates conservation and safe use of Energy Conservation and Consumption Reduction Clean Energy

electricity and fulfills its responsibility for green

development through refined energy control. For store The Company actively promotes energy conservation and consumption reduction work The Company actively explores the use of clean energy and put

them into use by "self-generation for self-use and surplus power

operations our headquarters has formulated the SOP equip the offices of the Group/regional headquarters and some stores with intelligent

connection to the grid". We have built photovoltaic power

for Standard Use of Water and Electricity in Stores. Its induction control systems starts and discontinues lighting and water supply on demand.Development Center manages energy consumption of We implement a monthly inspection system formulate a time switch system for door signs

generation rooftops in residential buildings and logistics

and store lights and reduce electric load during non-business hours. We strictly control the warehouses of our headquarters park Jiangsu Yangzhou Logistics each store clarifies the energy management

responsibilities energy conservation targets and set temperature of air conditioners and clean air conditioner filters on a regular basis to

Center and YST Pharma Factory. In 2025 our total installed

improve the operating efficiency of equipment and cut the power consumption. In addition photovoltaic capacity was 4528.64 kWp our total annual power assessment standards of all departments and generation was 5016.05 MWh our total electricity consumption

incorporates energy consumption indicators into the the Company carries out extensive electricity-saving publicity and posts reminder slogans to was 3636.46 MWh and our use of renewable energy increased by

annual performance appraisal of all business units guide employees to develop a good habit of turning off lights and standby equipment. 75% compared with 2024 which was equivalent to reducing

forming a responsibi l i ty system for energy greenhouse gas emissions by 3189.54 tons of CO2 equivalent.conservation that advocates "a shared responsibility Continuously Promoting the Modification Process of Flat Panel Lights

for all and level-by-level implementation". In its in Direct-sale Stores to Reduce Power Consumption

production operations YST Pharma has drafted the Based on the results of the special energy consumption assessment on flat panel

Energy Conservation and Cost Reduction Plan built a lights in direct-sale stores in 2024 the Company continuously promoted the

leading energy conservation group set up a energy-saving renovation project of the terminal lighting system. In 2025 74.45%

subordinate office divided the responsible areas energy-saving flat panel lights in direct-sale stores were replaced. With the large-

designated responsible persons of departments scale application of high-efficiency energy conservation technologies the

implemented daily inspection and irregular spot cumulative electricity consumption was saved by 9924271.31 kWh throughout

check mechanisms and clarified reasonable the year and the lighting energy consumption was effectively reduced.suggestions and target incentives for energy

conservation and cost reduction to ensure the

achievement of energy conservation goals. Photovoltaic Rooftop at the Headquarters ParkEquipping Logistics Distribution Centers with Intelligent Electricity

Consumption Equipment for Energy Conservation and Consumption

Risk Management Reduction

In 2025 the logistics distribution centers were equipped with variable-frequency

In the field of energy the Company focuses on equipment automatic control system and energy consumption management

identifying risks such as fluctuations in power grid platform to realize refined control of air-conditioning equipment automatically

electricity prices and regional power supply instability adjust the operation of equipment according to on-site temperature and

(especially affecting the constant temperature of cold humidity data acquisition and create a constant temperature field to control

chain in logistics centers operation and maintenance temperature humidity and energy consumption of equipment. By the end of the

of photovoltaic equipment). In the field of resources reporting period this initiative had saved 451000 kWh of electricity.we concentrate on rising prices of disposable

packaging materials and recycled materials as well Photovoltaic Rooftop of Yangzhou Logistics Distribution Center

as risks such as imbalance in regional deployment of

circular logistics carriers and excessive loss rate. For

various potential risks in energy and resource Our use of renewable energy in 2025

utilization we dynamically track energy costs and

resource reserves construct a circular logistics vehicle

and green packaging system strengthen closed-loop increased on a year-on-year basis by

management of resources comprehensively improve

our risk resistance in terms of energy and resource 75

utilization with multi-dimensional measures and %

ensure the continuity and stability of our operations.Case CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 94

Environmental Compliance Management Addressing Climate Change Use of Energies and Resources Green Operation

Usage of Water Resources Objectives and Indicators

The Company strictly adheres to laws and regulations such as the Water Law of the People's Republic of China upholding

water conservation and environmental protection in its operations. By comprehensively promoting intelligent water meters Objectives in 2025 Achievement in 2025

strengthening daily inspection operation and maintenance of water facilities scientifically optimizing our water allocation

scheme promoting "one water for multiple uses" and rainwater recovery we systematically enhance our employees' Water and electricity bills declined by 16.32% on a

awareness of water conservation and help build resource-saving enterprises. During its operation and production the water year-on-year basis in 2025

used by the Company comes from the local municipal water supply system and no difficulty is encountered in obtaining

suitable water sources. In 2025 approximately 3700 tons of rainwater were recycled and reused in the headquarters park of

the Company. To reduce water and

The fresh water consumption dropped by 9.33% on a

electricity bills by 2.29% year-on-year basis in 2025

on a year-on-year

Recyclable Packaging Materials basis in 2025 The consumption of the purchased electricity

The Company has set up a logistics distribution center as a functional department for comprehensive management of decreased by 16.37% on a year-on-year basis in 2025

various raw materials and packaging materials formulated the Management Regulations for Turnover Boxes of the Logistics

Distribution Center clarified the responsibilities of all departments for managing handover of turnover boxes and focused

on the reuse of recyclable logistics carriers and outer packaging materials so as to make the best use of materials and save

resources.During the reporting period the Company's energy and resource consumption is as follows:

The Company recycles logistics carriers such as pallets and turnover boxes to reduce the consumption of resources required

for the production of new carriers prolong the lifecycle of carriers and avoid idling of self-purchased carriers. The Logistics Category Unit 2025

Distribution Center promotes the recycling of outer packages and waste cartons. It recycles the outer packages and cartons

after unpacking and delivery of raw materials packaging materials and finished products for production storage and Energy consumption

transportation or recycling by third-party companies. In 2025 the Company recycled and reused 3124 tons of waste cartons.Natural gas m3 132950.00

Petrol litre 44375.86

Diesel litre 284200.00

Purchased electricity

Kwh 125775233.08

consumption

Total consumption of tons of standard

Standard Turnover Boxes and Pallets in the Logistics Distribution Center Carton Recycling non-renewable energy coal 16013.38

2025 (cumulative amount as of the end

Use of packaging materials Unit Total consumption of tons of standard

of the reporting period) renewable energy coal 446.92

Cumulative standard turnover boxes ton 812.15

Total energy tons of standard

16460.30

Cumulative standard pallets ton 1526.59 consumption coal

Intensity of energy tons of standard

0.74

Use of Recycling Cartons for Allocation between Warehouses to Reduce the Use of Disposable Cartons consumption coal/million

In order to deepen the practice of circular economy and optimize allocation

between warehouses a link of logistics in 2025 the Company upgraded its Consumption of water resources

green carriers for such allocation and invested the first batch of 7000

standardized recycling cartons covering the warehouse-to-warehouse Freshwater consumption ton 563057.34

allocation business on a nationwide basis. It was estimated that this

measure could reduce the use of 90000 disposable cartons throughout the

year effectively replace the traditional disposable cartons and build a Consumption intensity of ton/RMB million 25.32

warehouse-to-warehouse carrier allocation system for reuse and closed- water resources

loop circulation.(Note: Warehouse-to-warehouse allocation refers to allocation of commodities from Hunan Forworld Logistics Center to regional Note: The standard coal coefficient is derived from the General Rules for Calculation of Comprehensive Energy

logistics/distribution centers.) Consumption of the National Standard of the People's Republic of China (GB/T2589-2020);（GB/T2589-2020）

CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 95

Environmental Compliance Management Addressing Climate Change Use of Energies and Resources Green Operation

Green Operation

Taking the whole chain's green operation as its core strategy LBX Pharmacy coordinates the promotion of green actions in all links builds a low-carbon operating system covering all links including production circulation and

consumption fulfills its ecological responsibility with practical actions and supports the green transformation of the industry.Green Logistics

The Company has deeply integrated the green development concept into the construction of transportation and warehousing systems developed an integrated green transportation pattern for "on-site green operation and off-

site low-carbon distribution" and continuously reduced carbon emissions in logistics links.Green Warehousing

The Company builds logistics distribution centers in accordance with GSP standards as well as environmental protection and energy conservation requirements and promoted the upgrading to green warehousing in terms of

architectural design energy supply rational utilization of warehousing space etc.By combining building warehouses with automated three-dimensional warehouses we make full use of automated access equipment to improve storage efficiency and reduce the

consumption of land and human resources.The buildings use thermally insulated brick partition walls. Their exterior walls are decorated with thermally insulated decorative materials. The buildings are equipped with automatic

central air conditioning temperature and humidity monitoring systems. Temperature control equipment is started according to external temperature changes to meet the temperature

requirements of different reservoir areas.Photovoltaic power generation equipment has been installed on the roofs of warehouses thus saving more electric energy by more than 40% during the warehouse operation and

effectively reducing energy consumption.Green Distribution

The Company has formulated the Management System for Self-owned Vehicles of Logistics Distribution

Use of new energy vehicles for nationwide logistics distribution

Centers to standardize the management of self-owned vehicles in the distribution centers and reduce

the Company's operational risks and transportation costs. In on-site transportation all our forklifts 41

consume electrical energy. In off-site transportation the Company promotes the use of new energy Data as of the end of 2025

vehicles and builds a green transportation system of "on-site and off-site collaboration" for the use of electric forklifts in the Annually increased by

new energy vehicles within ≤300KM. logistics plant

On a nationwide basis more than 99% of our delivery vehicles are shared social vehicles. We take 143 vehicles 58vehicles

advantage of the differences in transportation and distribution time and routes in different industries to

reduce the operation of vehicles under no load. We also actively utilize digital and intelligent systems Data as of the end of 2025

to optimize transportation routes cut costs and reduce energy consumption. In 2025 through the

Data in 2025

delicacy management by the TMS (Transportation Management System) intelligent dispatch and

Accounted for

automatic vehicle arrangement the logistics distribution centers optimized their distribution routes

and loading volume increased their loading rate by 7% decreased the dispatch of vehicles by 4000

and effectively reduced the carbon emission footprint of the distribution link. 44000 69%

dispatchesContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 96

Environmental Compliance Management Addressing Climate Change Use of Energies and Resources Green Operation

Green Production Green Stores

YST Pharma strictly controls the compliance traceability and safety of raw material sources. It Adhering to the principle of benefiting people saving energy protecting environment and guaranteeing safety the Company has

adopts environmentally friendly processes in the safe production process to provide consumers actively constructed a green system covering store space and daily services. In its store design process the Company uses an

with safer and more environmentally friendly healthy traditional Chinese medicine decoction energy-saving intermittent lighting system to maximize the use of natural light and reduce power consumption while realizing

pieces. the lighting effect. During its construction of stores the Company has formulated the Store Decoration Project Management

System the Fifth Generation Store Decoration Standard and other systems scientifically standardized its operation process

utilized environmentally friendly new materials and technologies continuously optimized its decoration plan and implemented

Green Raw Materials the construction specifications that do not disturb residents and guarantee zero pollution in order to create environmentally

The multi-dimensional conductive harm of pesticide pollution not only causes continuous friendly and healthy spaces for consumers.damage to soil water and other ecosystems but also might affect human health through the

enrichment of agricultural products into the food chain. YST Pharma has reconstructed the raw During its operation of stores the Company has integrated the environmental protection concept into the terminal links of daily

material procurement and control modes from the source given priority to suppliers with bases services to help create a green consumption scenario. Since 2023 we have fully promoted the use of photodegradable eco-

for large-scale planting and supervised the prohibition of raw materials with pesticides friendly shopping bags that may be quickly and thoroughly decomposed into harmless substances under the natural

throughout the process by heading to frontend bases and monitoring the growth period. environment in stores on a nationwide basis effectively promoted plastic reduction and carbon emission reduction from the

source. In 2025 the Company made remitting efforts to deepen the use of photodegradable shopping bags optimized the

specification system for shopping bags set three subdivided sizes: large medium and small achieved "on-demand access and

Eco-Friendly Processes accurate adaptation" reduced resource waste from consumer terminals and increased the use of photodegradable shopping

bags to 38.01 million representing an increase of 10% compared with the use in 2024.YST Pharma innovatively integrates environmentally friendly

processes throughout the whole production chain and promotesthe green transformation of production links through "external LBX Puze Pharmacy's Action for "Reducing Plastics in Exchange for Green”

supply chain collaboration + internal technology upgrading". In

terms of external cooperation we prioritize the selection of From March to April 2025 LBX Puze Pharmacy carried out the event for "Reducing Plastics in

suppliers that adopt green energy drying technology and Exchange for Green" in its stores. During the event consumers received the "plastics

comprehensively promote the electric heating and low- reduction seal card" in any store. Whenever a consumer rejected a plastic bag and recycled 2

temperature drying processes for raw materials of Chinese empty medicine bottles/boxes the consumer would get a "green seal" and exchange for a

medicinal materials such as monk fruits and roses so as to reduce blind box of seeds of mint tomato or other plants with 3 green seals that already been

exhaust emissions and energy consumption from the source. collected. Meanwhile a "seed growth clocking" link was set. In this link consumers could

During our internal production we have upgraded our key clock in the community for 21 consecutive days after planting which could be exchanged for

production facilities introduced an automated production line for YANGDESIGN natural soap. This action not only drove the reduction of plastic use by stores

jujube sorting and innovatively realized the continuous sorting but also conveyed the concept of sustainability through seed planting and transmitted

and internal packaging processes in order to reduce the environmental protection practice and health concept.generation of packaging waste.Green Office Practices

Reduced Paper Use

The Company comprehensively promotes electronic approval and online collaboration platforms. Our contract signing financial reimbursement document circulation and other businesses are totally paperless. Besides the

Company vigorously advocates double-sided printing black-and-white printing paste paper-saving reminders in the printing areas and prepare secondary paper storage boxes.Our logistics distribution centers vigorously promote paperless distribution cancel paper packing lists and replace them with electronic lists. As at the end of the reporting period reduced paper use had been promoted in a

total of more than 7000 stores thus reducing the paper consumption by 6 million pieces. It is estimated that the paper consumption would be reduced by 8.75 million pieces per year in the future.Green Commuting

The headquarters of the Group provides employees with 13 new energy buses (7 self-owned buses and 6 rented buses) which transport more than 800 employees per day in single trips. According to the actual situation the

shuttle bus routes are planned as a whole to reduce the carbon emissions of employees' commuting. In addition the Company has mounted 18 charging piles for new energy vehicles in the headquarters park to provide

convenient support for green commuting.CaseContents Sustainability Management Governance Social Environmental 2025 Environmental Social and Governance Report 97

Environmental Compliance Management Addressing Climate Change Use of Energies and Resources Green Operation

Asset Conservation

The Company has established the Physical Asset Management System

conducted regular asset inventories with submission of inventory reports and LBX HRT Pharmacy's Public Welfare Activity Themed "Safe Drug Use Green Recycling" for Recycling Expired Drugs

launched an online asset management system to digitally manage the assets On March 5 2025 LBX HRT Pharmacy in conjunction with Baiyin Administration for Market Regulation carried out the public

throughout their lifecycle from procurement to scrapping so as to increase its welfare activity themed "Safe Drug Use Green Recycling" in Jingyuan Community. Focusing on the prevention and control of harms

asset management efficiency and asset recycling rate. of expired drugs and ecological protection the staff popularized the hazards of expired drugs the production of toxic substances

and the willful discarding of polluted soil and water sources to residents guided standardized treatment and set up recycling and

exchange points for expired drugs and discarded medical devices on the spot. This event demonstrated both environmental and

Grain Saving health significance as well as corporate responsibility.The Company arranges special personnel at the recycling window of the canteen

in the park to supervise the food waste behaviors and eliminate food waste. We

set up publicity slogans on the "Clean Plate Initiative" and supervision posts to

encourage employees to fulfill the "Clean Plate" commitment and create an office

atmosphere of "cherishing food advocating green low-carbon".Ecological Protection

The Company takes practical actions to protect the healthy development of the

ecology. Externally we actively carry out green public welfare practices such as

recycling of expired drugs warm winter charity donations Arbor Day initiative

publicity of firework prohibition and empty box recycling. Internally we upgrade

the office park of the headquarters with the goal of "activating the inner

courtyard space" prioritize the selection of local plants to create landscapes to be

consistent with regional ecological characteristics reduce maintenance costs

create a near-natural working environment for employees and improve both

eco-friendliness and spatial experience.LBX HRT Pharmacy's Public Welfare Action Named "Conveying Warmth in the Warm Winter · Jointly Keeping theBlue Sky Blue”

On November 23rd 2025 LBX HRT Pharmacy together with

Linxia Medical Insurance Bureau and Beijing Scrianen

Pharmaceutical carried out public welfare donation activities

in Qijia Village Party and Mass Service Center donating 25

electric heaters and 25 electric blankets respectively to

promote environmentally friendly and clean energy heating

which not only accommodated the villagers' heating needs in

winter but also reduced atmospheric pollution.Arbor Day Initiative Publicity for Firework Prohibition

Case CaseContents Appendices 2025 Environmental Social and Governance Report 98

Appendix 1. Table of Responsibility Performance

Governance Performance

Category Unit 2025 2024

Operating income RMB 100 million 222.37 223.58

Operating Status Net profit attributable to parent company RMB 100 million 3.82 5.19

Profit distribution (cash dividend) 1 RMB 100 million 3.11 3.12

Annual general shareholders' meeting times 2 4

Board of Directors meeting times 6 7

Corporate Governance

Board of Supervisors meeting times 3 6

Investor communication activities sessions 154 260

External third-party financial audit (including information times 1 1

security audit)

Percentage of employees participating in anti-corruption % 100 100

and anti-bribery training

Compliance Operation

The supervision and audit coverage of direct-sale stores % 100 100

Major cybersecurity incident times 0 0

Percentage of employees participating in information % 100 100

security training

Environmental Performance

Category Unit 2025 2024

Environmental Protection Input Total investment in environmental protection RMB 10000 106.59 123.14

Natural gas m3 132950 130852.33

Petrol litre 44375.86 36818.69

Diesel litre 284220 284295

Consumption of Renewable

Energy Purchased electricity Kwh 125775233.08 150388141.71

Total consumption of non-renewable energy tons of standard coal 16013.38 19027.64Contents Appendices 2025 Environmental Social and Governance Report 99

Category Unit 2025 2024

Consumption of Renewable Renewable energy electricity consumption Mwh 3636.46 2076.46

Energy

Renewable energy consumption tons of standard coal 446.92 255.2

Total energy consumption tons of standard coal 16460.30 19282.84

Total energy consumption

Intensity of energy consumption ton standard coal/ 0.74 0.86

RMB million

Scope 1 greenhouse gas emissions tCO?e 1006.49 985.32

Scope 2 greenhouse gas emissions tCO?e 66736.34 73690.19

Greenhouse Gas

Total greenhouse gas emissions (Scope 1 + Scope 2) tCO?e 67742.83 74675.51

Greenhouse gas emission intensity (Scope 1 + Scope 2) tCO2e/RMB million 3.05 3.34

Total waste emissions ton 847.12 808.97

Total hazardous waste ton 176.12 199.19

Solid Waste Total non-hazardous wastes ton 671 609.78

Hazardous waste density ton/RMB million 0.01 0.01

Non-hazardous waste density ton/RMB million 0.03 0.03

Waste Gas 2 Nitrogen oxides/NOx ton 0.32 0.29

Wastewater discharge ton 13842 12687

Chemical Oxygen Demand (COD) emissions in wastewater ton 0.24 0.15

Wastewater 3

Discharge of suspended solids (SS) in wastewater ton 0.37 0.18

Ammonia nitrogen discharge in wastewater ton 0.09 0.08

Freshwater consumption ton 563057.34 621006.18

Water resource

Consumption intensity of water resources ton/RMB million 25.32 27.78Contents Appendices 2025 Environmental Social and Governance Report 100

Social Performance

Category Unit 2025 2024

Total stores / 14975 15277

※ Dual-channel stores / 317 329

※ Stores with outpatient-specific disease categories and / 1725 1728

designated chronic diseases for outpatient care

Health Services

※ 24h stores / 730 694

Product SKU count types 24700+ 25800+

Archived chronic disease members (cumulative) 10000 people 2289+ 1812+

Customer satisfaction % 99.7 99.1

Total number of employees person 36892 40132

※ By gender

Female person 33212 35825

Male person 3680 4307

※ By age

30 and below person 7006 9194

30-50 person 26722 27884

50+ person 3164 3054

Employee Profile ※ By education

Postgraduate and above person 154 230

Bachelor's Degree person 6598 6369

Associate Degree person 16165 16217

College and below person 13975 17316

※ By job level

Employees not in senior management person 33475 36270

Grassroots management person 2932 3291

Middle management person 397 467

Senior management person 88 104

Number of female executives person 230 269

Proportion of female executives % 47 47

Diversified personnel

Number of female employees in key positions person 610 542

Ethnic personnel person 3667 3850Contents Appendices 2025 Environmental Social and Governance Report 101

Category Unit 2025 2024

Employee training participation rate % 100 100

Talent Development Average learning hours per person 4 hours 181 245

Employee promotion person-times 4159 2649

Health and Safety Major and more serious safety incident times 0 0

Total amount of assistance from the "Multi-Million HardshipEmployee Care RMB 1823780 1555852Assistance Fund”

Social Donations Charitable and public welfare donations 5 RMB 10000 1346.35 314.23

Explanation:

1. Profit distribution (cash dividends): The 2025 figure includes both the interim dividends for 2025 and the 2025 proposal which requires approval by the Company's

shareholders' meeting.

2. Wastewater: Refers to the industrial wastewater discharged by the company's subsidiary YST Pharma during the production of traditional Chinese medicine.

3. Waste gas: Refers to the exhaust gas data from the boiler of the company's subsidiary YST Pharma.

4. Average learning hours per person: Includes both online and offline training hours.

5. Charitable and public welfare donations: Includes various charitable donations conducted by LBX Pharmacy and its partners with the amount being the total value of cash

and materials.Contents Appendices 2025 Environmental Social and Governance Report 102

Appendix 2. Table of Index to Standards

Usage Instructions: LBX Pharmacy has prepared this report in accordance with the Shanghai Stock Exchange Sustainability Reporting Guidelines and the GRI Standards (2021 edition)

for the period from January 1 to December 31 2025.Table 1: Index of Shanghai Stock Exchange Sustainability Reporting Guidelines

Disclosure Content Corresponding Section in the Report

Article 4 Article 6 About This Report

Chapter 1

Article 5 Article 9 Article 10 Sustainability Management

Article 11 Article 12 Sustainability Management

Chapter 2

Article 14 Environmental Compliance Management

Article 21 Article 22 Article 24 Article 26 Article 27 Article 29

Environmental Compliance Management Use of Energies and Resources

Article 30 Article 31 Article 32 Article 34 Article 35 Article 36

Addressing Climate Change Green Operations

Article 37

Chapter 3

During the reporting period the company has not been subject to significant

Article 33 administrative penalties or criminal liabilities by relevant departments such as

ecological environment authorities due to environmental incidents.Article 38 Article 39 Article 40 Responsible Citizens

Innovation-driven Supply Chain Safety Quality Control Health Services

Chapter 4 During the reporting period the balance of the Company's accounts payable Article 42 Article 44 Article 45 Article 46 Article 47 (including notes payable) didn't exceed RMB 30 billion or account for over

50% of the total assets.

Article 48 Corporate Governance Information Security and Customer Privacy Protection

Article 49 Article 50 Employee Development

Article 51 Sustainability Management Corporate Governance

Article 52 Sustainability Management Innovation-driven Supply Chain Safety

Chapter 5 Article 53 Sustainability Management

Article 54 Corporate Governance Quality Control

Article 55 Article 56 Corporate Governance

Chapter 6 Article 57 Appendix 2Contents Appendices 2025 Environmental Social and Governance Report 103

Table 2: Index of GRI Standards (2021 Edition)

GRI 1: Foundation 2021

GRI 2: General Disclosures 2021

GRI Standard Disclosure Corresponding Section

Disclosure Content

Item Number in the Report

GRI 2-1 Organizational details About LBX Pharmacy

The organization and its

GRI 2-2 Entities included in the organization's sustainability reporting About LBX Pharmacy

reporting practices

GRI 2-3 Reporting period frequency and contact person Preparation Instructions

GRI 2-6 Activities value chain and other business relationships Innovation-driven Supply Chain Safety

Activities and workers

GRI 2-7 Employees Employee Development

GRI 2-9 Governance structure and composition Corporate Governance Annual Report

GRI 2-10 Nomination and selection of the highest governance body Corporate Governance Annual Report

GRI 2-11 Chair of the highest governance body Corporate Governance Annual Report

Role of the highest governance body in overseeing the

GRI 2-12 Sustainability Management Corporate Governancemanagement of impacts

GRI 2-13 Delegation of responsibility for managing impacts Sustainability Management

Control

GRI 2-14 Role of the highest governance body in sustainability reporting Sustainability Management

GRI 2-16 Communication of critical concerns Sustainability Management

Sustainability Management Corporate Governance

GRI 2-17 Collective knowledge of the highest governance body Annual Report

GRI 2-18 Performance appraisal of the highest governance body Sustainable Development Management Annual Report

GRI 2-19 Remuneration policy Annual Report

GRI 2-20 Process to determine remuneration Annual Report

Words from the Chairman Sustainability

GRI 2-22 Statement on sustainable development strategies Management

GRI 2-23 Policy commitments Corporate Governance Employee Development

GRI 2-24 Integration of policy commitments Corporate Governance Innovation-driven

Strategy policies and GRI 2-25 Procedures for remediation of negative impacts Corporate Governance

practices GRI 2-26 Mechanisms for seeking advice and raising concerns Corporate Governance Employee Development

GRI 2-27 Compliance with laws and regulations Appendix 3

GRI 2-28 Membership associations Innovation-driven

GRI 2-29 Approach to stakeholder engagement Sustainability ManagementContents Appendices 2025 Environmental Social and Governance Report 104

GRI 3: Material Issues 2021 2021

GRI Standard Disclosure Item Number Disclosure Content Corresponding Section in the Report

GRI 3-1 Process to determine material topics Sustainability Management

GRI 3-2 List of Substantive Issue Sustainability Management

GRI 3-3 Management of Material Topics Sustainability Management

Economy

GRI Standard Disclosure

Disclosure Content Corresponding Section in the Report

Item Number

GRI 201-1 Direct economic value generated and distributed Data of 2025 Annual Report

GRI 201: Financial impacts brought by climate change and other Addressing Climate Change Environmental

Economic Performance 2016 GRI 201-2 risks andOpportunities Compliance Management

GRI 201-3 Defined benefit plan obligations and other retirement plans Employee Development

GRI 203: GRI 203-1 Infrastructure investments and services supported Quality Control Health Services Responsible Citizens

Indirect Economic Impacts 2016 GRI 203-2 Significant indirect economic impacts Innovation-driven Responsible Citizens

GRI 205-1 Operations assessed for corruption risks Compliance Management

GRI 205:

Anti-corruption 2016 Communication and training about anti-corruption

GRI 205-2 Compliance Managementpolicies and procedures

GRI 206: Legal actions for unfair competition behavior anti-trust

206-1 Compliance ManagementUnfair competition practices 2016 and anti-monopoly practices

GRI 207-1 Tax management approach Compliance Management

GRI 207: GRI 207-2 Tax governance control and risk management Compliance Management Annual Report

Tax 2019 Engagement with stakeholders and management of

GRI 207-3 Compliance Management

tax-related issues

Environmental

GRI Standard Disclosure

Disclosure Content Corresponding Section in the Report

Item Number

GRI 301-1 Materials used by weight or volume Environmental Compliance Management Green Operations

GRI 301: Materials 2016 GRI 301-2 Recycled feedstock used Environmental Compliance Management Green Operations

GRI 301-3 Recycled products and their packaging materials Environmental Compliance Management Green OperationsContents Appendices 2025 Environmental Social and Governance Report 105

GRI Standard Disclosure

Disclosure Content Corresponding Section in the Report

Item Number

GRI 302-1 Energy consumption within the organization Environmental Compliance Management Use of Energies and Resources

GRI 302: GRI 302-3 Energy intensity Environmental Compliance Management Use of Energies and Resources

Energy 2016 GRI 302-4 Reduction of energy consumption Environmental Compliance Management Use of Energies and Resources

GRI 302-5 Reducing the energy demand of products and services Environmental Compliance Management Use of Energies and Resources

GRI 303-2 Management of water discharge-related impacts Environmental Compliance Management Use of Energies and Resources

GRI 303:

Water and Wastewater GRI 303-4 Water discharge Environmental Compliance Management Use of Energies and Resources

2018 GRI 303-5 Water consumption Environmental Compliance Management Use of Energies and Resources

GRI 305-1 Direct (scope 1) greenhouse gas emission Use of Energies and Resources Addressing Climate Change

GRI 305-2 Energy indirect (scope 2) greenhouse gas emission Use of Energies and Resources Addressing Climate Change

GRI 305-4 Greenhouse gas emission intensity Use of Energies and Resources Addressing Climate Change

GRI 305:

Emissions 2016 GRI 305-5 Reduction of GHG greenhouse gas) emissions Use of Energies and Resources Addressing Climate Change

Nitrogen oxides (NO x ) sulfur oxides (SO x ) and other

GRI 305-7 Use of Energies and Resources Addressing Climate Changesignificant air emissions

GRI 306: GRI 306-1 Waste generation and significant impacts related to waste Environmental Compliance Management Green Operations

Effluents and Waste GRI 306-2 Management of significant waste-related impacts Environmental Compliance Management Green Operations

2020 GRI 306-3 Waste diverted from disposal Environmental Compliance Management Green Operations

GRI 308 GRI 308-1 New suppliers screened using environmental criteria Supply Chain Safety Green Operations

Supplier Environmental Negative environmental impacts in the supply chain and

Assessment 2016 GRI 308-2 Supply Chain Safety Green Operationsactions taken

Social

GRI Standard Disclosure

Disclosure Content Corresponding Section in the Report

Item Number

Recruitment rate of new employees and employee

GRI 401-1 Employee Development

turnover rate

GRI 401:

Benefits provided to full-time employees (excluding

Employment 2016 GRI 401-2 Employee Developmenttemporary or part-time employees)

GRI 401-3 Parental leave Employee Development

GRI 402:

Labor/Management GRI 402-1 Minimum notice period for operational changes Employee Development

Relations 2016Contents Appendices 2025 Environmental Social and Governance Report 106

GRI Standard Disclosure

Disclosure Content Corresponding Section in the Report

Item Number

GRI 403-1 Occupational health and safety management system Employee Development

GRI 403-3 Occupational health services Employee Development

GRI 403: Occupational health and safety issues: worker participation

Occupational Health GRI 403-4 Employee Developmentconsultation and communication

and Safety 2018

GRI 403-5 Worker training on occupational health and safety Employee Development

GRI 403-6 Promotion of worker health Employee Development

Workers covered by an occupational health and safety

GRI 403-8 Employee Developmentmanagement system

GRI 403-9 Work-related injuries Employee Development

GRI 404-1 Average hours of training per year per employee Employee Development

GRI 404: Training and Programs for upgrading employee skills and transition GRI 404-2 Employee Development

Education 2016 assistance programs

Percentage of employees who regularly undergo performance

GRI 404-3 Employee Developmentand career development assessments

GRI 405: Diversity and

GRI 405-1 Diversity of governance bodies and employees Employee Development

Equal Opportunity 2016

GRI 406: Anti-

GRI 406-1 Discrimination incidents and corrective actions taken Employee Development

Discrimination 2016

GRI 407: Freedom of

Operational points and suppliers at risk of violating freedom

Association and Collective GRI 407-1 Employee Developmentof association and collective bargaining rights

Bargaining 2016

GRI 408: Operations and suppliers at significant risk of child During the reporting period LBX Pharmacy had no operations or

Child Labor 2016 GRI 408-1 labor incidents suppliers at significant risk of child labor incidents.GRI 409: Forced or Operations and suppliers at significant risk for incidents During the reporting period LBX Pharmacy had no operations or

Compulsory Labor 2016 GRI 409-1 of forced or compulsory labor suppliers at significant risk of forced or compulsory labor incidents.GRI 413: Operations with local community engagement impact

GRI 413-1 Responsible Citizens

Local Communities 2016 assessments and development programs

GRI 414-1 New suppliers that were screened using social criteria Supply Chain Safety

GRI 414: Supplier Social

Assessment 2016 414-2 Negative social impacts in the supply chain and GRI 414-2 Supply Chain Safety

actions taken

GRI 416: Customer Health Assessment of the health and safety impacts of product

GRI 416-1 Quality Control Health Services

and Safety 2016 and service categories

GRI 417: Marketing and

GRI 417-1 Requirements for product and service information and labeling Compliance Operation Quality Control Health Services

Labeling 2016

GRI 418: Substantiated complaints concerning breaches of During the reporting period LBX Pharmacy received no verified

Customer Privacy 2016 GRI 418-1 customer privacy and losses of customer data complaints involving the infringement of customer privacy or the

loss of customer information.Contents Appendices 2025 Environmental Social and Governance Report 107

Appendix 3. List of Laws and Regulations

Report Section Compliance with Laws and Regulations Internal Policies and Systems of the Company

Criminal Law of the People's Republic of China Articles of Association Integrity Management System

Criminal Procedure Law of the People's Republic of China Rules of Procedure for the Shareholders' Meeting Inspection and Audit Work Manual

Civil Code of the People's Republic of China Rules of Procedure for the Board of Directors Internal Control Manual

Company Law of the People's Republic of China Constitution for the Comprehensive Risk Whistleblowing and Complaint

Interim Provisions on Banning Commercial Bribery Management Comprehensive Risk Management Management Measures

Yellow Book

Supervision Law of the People's Republic of China LBX Pharmacy "Blacklist" Management

Group's Legal Affairs Management System Measures

Labor Law of the People's Republic of China

Group System Management Norms Measures for Combating Unfair

Law of the People's Republic of China on Public Security

Governance Administration Penalties Group Process Management Norms

Competition

Anti-Monopoly Law of the People's Republic of China Group Risk Compliance Baseline Management

Group Data Security Management System

Norms Group Information System Security

Anti-Unfair Competition Law of the People's Republic of China

Group's Public Opinion Crisis Management System Emergency Response Management System

Data Security Law of the People's Republic of China

Group and Theater of Operations Authority Manual Group Information System Authority

Cybersecurity Law of the People's Republic of China Management System

Intellectual Property Management System

Patent Law of the People's Republic of China Group Information Security Vulnerability

Group Confidentiality Management System Management System

Trademark Law of the People's Republic of China

Pharmaceutical Administration Law of the People's Republic of Member Data Management System Nighttime Medication Sales Management

China Medical Insurance Management System Norms for Direct-sale Stores

Good Supply Practice for Pharmaceutical Products Compilation Customer Complaint Management System

Supervision and Administration Measures for the Quality of Quality Management System Membership Management System

Pharmaceutical Operation and Use Pharmaceutical Procurement Management System Group Product Price Compliance

Supervision and Administration Measures for the Online Sale of Pharmaceutical Quality Acceptance Management Management System

Pharmaceuticals System Self-Media Platform Content Publishing

Regulations on the Supervision and Administration of Medical Pharmaceutical Expiry Management System Management System

Devices

Pharmaceutical Transportation Management Supplier Inspection Work Procedures

Good Supply Practice for Medical Device Operation System Supplier Quality Review Criteria

Social Regulations on the Supervision and Administration of Cosmetics Pharmaceutical Sales Management System Product Procurement Contract

Food Safety Law of the People's Republic of China Pharmaceutical Recall Management System Management System

Product Quality Law of the People's Republic of China Quality Complaint Management System Group Non-Product Bidding and

Law of the People's Republic of China on the Protection of Procurement System Measures for the Administration of Adverse Drug

Consumer Rights and Interests Reaction Reporting and Monitoring Group Blacklist Supplier Management

Price Law of the People's Republic of China SystemNonconforming Pharmaceuticals and Destruction

Advertising Law of the People's Republic of China Procedures Administrative Measures for Combating

Unfair Competition

Anti-Monopoly Law of the People's Republic of China Operational Fundamentals Execution Standards目录 附录 2025年环境、社会和公司治理(ESG)报告 108

Report Section Compliance with Laws and Regulations Internal Policies and Systems of the Company

Anti-Unfair Competition Law of the People's Republic of China Group Trade Union Work Management Measures

Bidding and Tendering Law of the People's Republic of China Employee Representative Assembly Management Measures

Trade Union Law of the People's Republic of China Group Labor Relations Management System

Labor Law of the People's Republic of China Group Employment Management System

Labor Contract Law of the People's Republic of China Group's Recruitment Management Regulations

Social Insurance Law of the People's Republic of China Group Training Management System

Law of the People's Republic of China on the Prevention and Group Performance Assessment Management System Group Internal Talent Mobility

Control of Occupational Diseases Management Regulations

Social Fire Control Law of the People's Republic of China Group Internal Promotion Management System

Law of the People's Republic of China on Work Safety Group's Management Regulations for Salaries Benefits Trade Union Fees and Supplier

Law of the People's Republic of China on Emergency Response to Resources

Sudden Incidents Group Satisfaction Plan

Road Traffic Safety Law of the People's Republic of China Group's Administrative Measures for the Multi-Million Hardship Assistance Fund

Measures for the Administration of Emergency Response Plans for Management Regulations on Preventing Sexual Harassment in the Workplace

Production Safety Accidents Work Safety Management System

Law of the People's Republic of China on Special Equipment Safety Fire Safety Management System

Regulations on Emergency Response to Production Safety Group Logistics Safety Accident Management System

Accidents

Warehouse Fire Emergency Response Plan

Regulations on Reporting Investigation and Handling of

Production Safety Accidents Work Safety Hidden Danger Investigation and Rectification System

Regulations on Work-related Injury Insurance Outward Donation Management System

Charity Law of the People's Republic of China

Environmental Protection Law of the People's Republic of China Group's Operation Management System for Realizable Waste

Solid Waste Pollution Environmental Prevention and Control Law Regulations on the Management of Hazardous Waste Sites

of the People's Republic of China Hazardous Waste Management System

National Catalogue of Hazardous Wastes Environmental Sanitation Management System

Water Pollution Prevention and Control Law of the People's Wastewater Treatment Center Management System

Republic of China

Energy Conservation and Consumption Reduction Operation Manual

Air Pollution Prevention and Control Law of the People's Republic

of China SOP for Standard Use of Water and Electricity in Stores

Environmental Soil Pollution Prevention and Control Law of the People's Republic Office Environment Management System

of China

Environmental Noise Pollution Prevention and Control Law of the

People's Republic of China

Energy Conservation Law of the People's Republic of China

Water Law of the People's Republic of China

Regulations on the Administration of Waste Discharge PermitNo. 808 Qingzhu Lake Road Kaifu District Changsha City Hunan Province

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