鲁泰B:2025年半年度报告（英文版）

Lu Thai Textile Co. Ltd. Interim Report 2025

LU THAI TEXTILE CO. LTD.INTERIM REPORT 2025

August 2025

1Lu Thai Textile Co. Ltd. Interim Report 2025

Part I Important Notes Table of Contents and Definitions

The Board of Directors (or the “Board”) and the directors as well as senior

executives of Lu Thai Textile Co. Ltd. (hereinafter referred to as the

“Company”) hereby guarantee the factuality accuracy and completeness of

the contents of this Report and its summary and shall be jointly and severally

liable for any misrepresentations misleading statements or material omissions

therein.Liu Zibin the Company’s legal representative and Zhang Keming head of

accounting affairs and head of the accounting department (equivalent to

accounting manager) hereby guarantee that the Financial Statements carried

in this Report are factual accurate and complete.All the Company’s directors have attended the Board meeting for the review of

this Report and its summary.The Company has described in detail in this Report the possible risks. Please

refer to the contents of “XI Risks Facing the Company and Countermeasures”

in Part III “Management Discussion and Analysis” of this Report. Securities

Times Shanghai Securities News China Securities Journal Ta Kung Pao and

www.cninfo.com.cn have been designated by the Company for its information

disclosure in 2025. And all information about the Company shall be subject to

what’s disclosed by the Company on the aforesaid media. Investors are kindly

reminded to exercise caution when making investment decisions.The Company is subject to the disclosure requirements for listed companies

engaging in textile and apparel as stated in Self-Regulatory Guidelines of

2Lu Thai Textile Co. Ltd. Interim Report 2025

Shenzhen Stock Exchange for Listed Companies No.3 - Industry Information

Disclosure.In H1 2025 the global geopolitical situation became more complex economic

growth slowed down and uncertainties risks in global trade accelerated. By

implementing proactive macroeconomic policies China’s economy maintained

generally stable and improving performance during this period. According to

data released by the National Bureau of Statistics China’s gross domestic

product (GDP) grew by 5.3% year-on-year in the first six months and the total

retail sales of consumer goods reached RMB24.55 trillion a year-on-year-

increase of 5.0%. Against this backdrop China’s textile industry faced certain

pressures in foreign trade but demonstrated overall stability. Based on data

released by the China Customs Express the total export value of textiles and

apparel reached USD143.98 billion in the first half of the year reflecting a

year-on-year increase of 0.8%. Leveraging the competitive strengths of the full

industrial chain and globalized operations textile foreign trade enterprises

swiftly adjusted their business strategies proactively responded to changes in

the external environment and focused on mitigating foreign trade risks. The

efforts to diversify international market layout have gradually yielded results.Looking ahead to the full year the global economic development environment

remains complex and severe and consolidating the foundation for stable and

improving growth still faces many challenges. For details please refer to Part

III Management Discussion and Analysis.

3Lu Thai Textile Co. Ltd. Interim Report 2025

The Board of Directors has approved a final dividend plan as follows: based on

the share capital of 817306563 shares a cash dividend of RMB1.00 (tax

inclusive) per 10 shares is to be distributed to the shareholders with no bonus

shares issue from either profit or capital reserves.

4Lu Thai Textile Co. Ltd. Interim Report 2025

Table of Contents

Part I Important Notes Table of Contents and Defin... 2

Part II Corporate Information and Key Financial In....8

Part III Management Discussion and Analysis .........11

Part IV Corporate Governance Environmental and Soc...27

Part V Significant Events .......................... 29

Part VI Share Changes and Shareholder Information .. 36

Part VII Bonds ......................................45

Part VIII Financial Statements ......................49

Part IX Other Submitted Data ...................... 161

5Lu Thai Textile Co. Ltd. Interim Report 2025

Documents Available for Reference

I. The financial statements signed and stamped by the Company’s legal representative and head of accounting affairs and head of

the accounting department; and

II. The originals of all the Company’s announcements and documents disclosed to the public during the Reporting Period on

Securities Times Shanghai Securities News China Securities Journal and Ta Kung Pao.

6Lu Thai Textile Co. Ltd. Interim Report 2025

Definitions

Term Refers to Definition

Lu Thai Textile Co. Ltd. and its consolidated

The “Company” “LTTC” “Issuer” or “we” Refers to

subsidiaries except where the context otherwise requires

The Board of Directors Refers to The Board of Directors of Lu Thai Textile Co. Ltd.CSRC Refers to The China Securities Regulatory Commission

Expressed in the Chinese currency of Renminbi

RMB RMB’0000 Refers to

expressed in ten thousand Renminbi

The “Company Law” Refers to The Company Law of the People’s Republic of China

The “Securities Law” Refers to The Securities Law of the People’s Republic of China

The “Reporting Period” or “Current Period” Refers to The period from January 1 2025 to June 30 2025

7Lu Thai Textile Co. Ltd. Interim Report 2025

Part II Corporate Information and Key Financial Information

I Corporate Information

Stock name LTTC LTTC-B Stock code 000726 200726

Previous stock name (if any) N/A

Stock exchange for stock listing Shenzhen Stock Exchange

Company name in Chinese 鲁泰纺织股份有限公司

Abbr. (if any) 鲁泰纺织

Company name in English (if any) LU THAI TEXTILE CO. LTD

Abbr. (if any) LTTC

Legal representative Liu Zibin

II Contact Information

Board Secretary Securities Representative

Name Zheng Weiyin Li Kun

No. 81 Songling East Road Zichuan No. 81 Songling East Road Zichuan

Address

District Zibo Shandong P.R.China District Zibo Shandong P.R.China

Tel. 0533-5285166 0533-5285166

Fax 0533-5418805 0533-5418805

Email address wyzheng@lttc.com.cn likun@lttc.com.cn

III Other Information

1. Contact Information of the Company

Indicate by tick mark whether any change occurred to the registered address office address and their zip codes website address

email address and other contact information of the Company in the Reporting Period.□ Applicable □ Not applicable

No change occurred to the said information in the Reporting Period which can be found in the 2024 Annual Report.

2. Media for Information Disclosure and Place where this Report is Lodged

Indicate by tick mark whether any change occurred to the information disclosure media and the place for lodging the Company’s

periodic reports in the Reporting Period.□ Applicable □ Not applicable

The website of the Shenzhen Stock Exchange media and website where the Company’s periodic reports are disclosed as well as

the place for lodging such reports did not change in the Reporting Period. The said information can be found in the 2024 Annual

Report.

8Lu Thai Textile Co. Ltd. Interim Report 2025

3. Other Information

Indicate by tick mark whether any change occurred to other information in the Reporting Period.□ Applicable □ Not applicable

IV Key Financial Information

Indicate by tick mark whether there is any retrospectively restated datum in the table below.□ Yes □ No

H1 2025 H1 2024 Change (%)

Operating revenue (RMB) 2827110139.70 2830488685.61 -0.12%

Net profit attributable to the listed

360215726.72169559969.54112.44%

company’s shareholders (RMB)

Net profit attributable to the listed

company’s shareholders before 225615338.79 263731284.55 -14.45%

exceptional gains and losses (RMB)

Net cash flow from operating activities

263993640.96451421652.69-41.52%

(RMB)

EPS-basic (RMB/share) 0.44 0.21 109.52%

EPS-diluted (RMB/share) 0.40 0.19 110.53%

Weighted average ROE (%) 3.75% 1.83% 1.92%

June 30 2025 December 31 2024 Change (%)

Total assets (RMB) 13877337463.13 13929715649.21 -0.38%

Equity attributable to the listed company’s

9709820392.549438728389.282.87%

shareholders (RMB)

Net profit excluding share-based payment expense

H1 2025

Net profit excluding share-based payment expense (RMB) 367958307.91

V Accounting Data Differences under China’s Accounting Standards for Business

Enterprises (CAS) and International Financial Reporting Standards (IFRS) and Foreign

Accounting Standards

1. Net Profit and Net Assets Differences under CAS and IFRS

□ Applicable □ Not applicable

No such differences for the Reporting Period.

2. Net Profit and Net Assets Differences under CAS and Foreign Accounting Standards

□ Applicable □ Not applicable

No such differences for the Reporting Period.

9Lu Thai Textile Co. Ltd. Interim Report 2025

VI Exceptional Gains and Losses

□ Applicable □ Not applicable

Unit: RMB

Item Amount Note

Gain or loss on disposal of non-current assets (inclusive of impairment allowance

-484650.50

write-offs)

Government grants recognized in profit or loss for the Current Period (exclusive

of those that are closely related to the Company’s normal business operations and

11318154.97

given in accordance with defined criteria and in compliance with government

policies and have a continuing impact on the Company’s profit or loss)

Gain/loss on changes in fair value in financial assets and liabilities held by a non-

financial enterprise as well as on disposal of financial assets and financial

143576091.96

liabilities (exclusive of the effective portion of hedges that is related to the

Company’s normal business operations)

Non-operating income and expense other than the above 5423599.73

Less: Income tax effects 24241165.21

Non-controlling interests effects (after tax) 991643.02

Total 134600387.93

Particulars about other items that meet the definition of exceptional gain/loss:

□ Applicable □ Not applicable

No such cases for the Reporting Period.Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item listed in the Explanatory Announcement

No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Non-recurring Gains and Losses:

□ Applicable □ Not applicable

No such cases for the Reporting Period.

10Lu Thai Textile Co. Ltd. Interim Report 2025

Part III Management Discussion and Analysis

I Principal Activity of the Company in the Reporting Period

Since the beginning of this year factors such as insufficient global consumer demand geopolitical conflicts and rising trade

protectionism have exerted considerable pressure on the development of the textile and apparel industry. Confronted with a

complex and volatile economic landscape and industry environment the Company has adhered to the “customer-focused”

philosophy firmly implemented the dual strategies of “Improve Quality and Efficiency” and “Overall Internationalization”

intensified market expansion efforts and actively integrated into the dual-circulation development pattern of both domestic and

international markets. During the Reporting Period all production and operational activities were carried out in an orderly manner.For the Reporting Period the Company achieved operating revenue of RMB2827 million operating profit of RMB419 million a

net profit attributable to the parent company of RMB360 million and a net profit attributable to the parent company before

exceptional gains and losses of RMB226 million respectively down 0.12% up 117.58% up 112.44% and down 14.45% when

compared with the same period of last year. No changes occurred to the Company’s principal operations primary products

business models or the primary factors driving the Company’s growth in the Reporting Period.During the Reporting Period the Company was recognized as an “AAA Credit Enterprise” by the China Enterprise Confederationand China Entrepreneur Association. It was awarded the “Outstanding Contribution Award for High-Quality Development ofPrivate Economy in Shandong Province” by the Shandong Provincial Development and Reform Commission and the ShandongProvincial Department of Industry and Information Technology. Furthermore in the “2025 China Brand Value EvaluationInformation” released by the China Council for Brand Development the Company’s brand value ranked ninth in the industry for

textiles apparels shoes and hats. The Company mainly focused on the following aspects:

i. Emphasize channel development and create a diversified market layout

The Company placed great emphasis on exploring both domestic and international markets actively advancing the development

and sales of casual fabrics and multi-category apparel. It expanded into consumer markets such as workwear and school uniforms

as well as online sales channels while providing one-stop solutions for apparel-related product categories. By continuously

enriching its product portfolio and leveraging advantages in production capability and product quality the Company consistently

met customer needs. On the other hand capitalizing on its existing overseas production bases in Southeast Asia the Company

intensified efforts to develop markets in countries and regions along the “Belt and Road” initiative. It continued to optimize

production capacity at overseas facilities participated in various types of exhibitions and focused on developing new products and

acquiring new customers while also emphasizing the prevention and diversification of trade risks.ii. Empower with innovation to promote high-end product system development

The Company advanced the reform of its R&D system leveraging the advantages of the full industry chain and its domestic and

international production and design platforms to continuously improve its new product development and technology research

system. Focusing on product functionality enhancement green and sustainable product development and processing technology

research it further strengthened its market-oriented development and research system. Emphasis was placed on the

commercialization of technological achievements custom development for strategic customers and the development of new

materials such as linen and elastic fabrics as well as new products for trousers and women’s wear fabrics maintaining the

Company’s leading position in the global mid-to-high-end fabric market. During the Reporting Period the Company was granted

25 patents including 19 for invention and six for utility models.

iii. Focus on talent development and strengthen multi-tiered talent reserves

The Company has continuously innovated its vocational education collaboration model with educational institutions at various

levels implementing “order-based training” and “dual-system” education programs dedicated to cultivating applied innovative

and high-quality professionals. It engaged in specialized research partnerships with universities actively contributing to solving

11Lu Thai Textile Co. Ltd. Interim Report 2025

critical bottleneck technologies in the industry. By providing cutting-edge research topics and advanced scientific conditions the

Company attracted and nurtured young top-tier research talent. On the other hand emphasis was placed on building localized

talent teams at overseas production bases. A variety of professional skill training programs were carried out across all product lines

enhancing the technical capabilities of all employees. Through a combination of internal training and external cooperation the

Company established a solid talent foundation to support its growth.The Company is subject to the disclosure requirements for listed companies engaging in textile and apparel as stated in Self-

Regulatory Guidelines of Shenzhen Stock Exchange for Listed Companies No.3 - Industry Information Disclosure.This year the international environment has been complex and volatile and the international economic and trade order has faced

challenges. Confronted with weak demand and challenges in both domestic and overseas markets China’s textile industry has

solidly advanced industrial structure optimization and adjustment and deepened the transformation and upgrading of foreign trade.Supported by the country’s proactive macroeconomic policies the industry maintained a generally stable economic performance in

the first half of the year with exports sustaining growth under heavy pressure. According to data from the National Bureau of

Statistics and the General Administration of Customs in the first half of the year Chinese residents’ consumer demand for

clothing continued to be released with per capita clothing consumption expenditure increasing by 2.1% year-on-year. In terms of

export data from January to June China’s cumulative textile exports reached USD70.52 billion up 1.8% year-on-year while

apparel exports amounted to USD73.46 billion down slightly by 0.2% year-on-year. Relying on its complete industrial system

advanced manufacturing advantages and diversified international market layout China’s textile industry has continued to

consolidate and accumulate development resilience amid a complex external environment. Looking ahead to the second half of the

year the textile industry still faces multiple uncertainties. Enterprises in the industry need to adhere to the development orientation

of “technology fashion green and health” actively prevent and mitigate risks and challenges in the foreign trade sector counter

the uncertainties in the external market environment with the certainty of high-quality development and strive to promote the

stable operation of the textile industry throughout the year.II Core Competitiveness Analysis

1. The Company has a comprehensive vertical industrial chain and internationalized layout. It possesses the whole industrial chain

integrating spinning bleaching and dyeing neatening testing and garment making as well as excellent quality control

capabilities through various links of the production of high-end yarn-dyed fabrics. The Company has established overseas

production bases design institutions and market service agencies enabling it to integrate and allocate international resources. This

leverages the advantages of its global industrial layout and highlights its leading position in the production of yarn-dyed fabrics.

2. The Company has better integrated management capability and high-level management system architecture. Since 1995 the

Company has successively passed the certification of ISO9001 quality management system ISO14001 environmental

management system ISO45001 Occupation Health Safety Management System SA8000 Social Responsibility Management

System The Worldwide Responsible Apparel Production Standard (WRAP) Sustainable Textile Production (STeP) Global

Organic Textile Standard (GOTS) Global Recycle Standard (GRS) HIGG (FEM and FSLM) and China National Accreditation

Service for Conformity Assessment (CNAS) and realized the internationalization standardization and normalization of the

corporate management. In order to make outstanding achievement in its operating management better improve the Company’s

business performance and capabilities the Company has introduced the GB/T19580 Criteria for Performance Excellence step by

step set up the “big quality” system promoted the management innovation and guaranteed the management quality.

3. The Company establishes its high-level technical cooperation platform by virtue of strong R&D capability. In fact the

Company always insists on the independent innovation by relying on various technical platforms including the National Enterprise

Technical Centre the National Industrial Design Centre the National Post-doctoral Scientific Research Station and Shandong

Provincial Engineering Technology Research Centre. It has established long-term technical cooperation and joint product

development with various research institutes colleges and universities strategic clients and important suppliers. Emphasizing both

12Lu Thai Textile Co. Ltd. Interim Report 2025

cutting-edge technological reserves and the innovation of applied technologies the Company continuously strengthens the

development of new products oriented towards realizing commercial value. Gradually enhancing its capability in technological

research and product integration development the Company continually contributes more green low-carbon and sustainable new

technologies and high-quality products to the industry creating more value for customers and materializing low-carbon green and

sustainable development.III Core Business Analysis

Overview:

See contents under the heading “I Principal Activity of the Company in the Reporting Period” above.Year-on-year changes in key financial data:

Unit: RMB

Year-on-year

H1 2025 H1 2024 Main reason for change

change (%)

Operating revenue 2827110139.70 2830488685.61 -0.12%

Cost of sales 2168474896.26 2131993492.13 1.71%

Selling expense 69698089.77 63286721.28 10.13%

Administrative

162947077.39158805160.692.61%

expense

Financial expenses -7802571.11 4249591.93 -283.61% Increased interest income year-on-year

Income tax expense 56505920.02 18864805.79 199.53% Increased profit before tax year-on-year

R&D investments 100446619.98 115374597.19 -12.94%

Decreased cash received from sale of

Net cash flow from commodities and rendering of services

263993640.96 451421652.69 -41.52% year-on-year and increased payments

operating activities for commodities and services year-on-

year

Net cash generated

from/used in investing 3304744.78 -358741366.46 100.92% Increased cash received from returnsof investments year-on-year

activities

Net cash generated

from/used in financing -195993183.24 195943296.16 -200.03% Decreased cash received fromborrowings year-on-year

activities

Net increase in cash

98632380.99 297560194.04 -66.85% Decrease net cash flow from operating

and cash equivalents activities year-on-year

Significant changes to the profit structure or sources of the Company in the Reporting Period:

□ Applicable □ Not applicable

No such changes in the Reporting Period.Breakdown of operating revenue:

Unit: RMB

H1 2025 H1 2024

As % of total As % of total Year-on-year

Amount operating revenue Amount operating revenue change (%)

(%)(%)

Total operating 2827110139.70 100% 2830488685.61 100% -0.12%

13Lu Thai Textile Co. Ltd. Interim Report 2025

revenue

By operating division

Textile and apparel 2622625528.96 92.77% 2626711642.70 92.80% -0.16%

Electricity and

138968395.264.92%136341429.914.82%1.93%

steam

Others 65516215.48 2.32% 67435613.00 2.38% -2.85%

By product category

Fabric products 1850500289.50 65.46% 2008100132.02 70.95% -7.85%

Shirts 772125239.46 27.31% 618611510.68 21.86% 24.82%

Electricity and

138968395.264.92%136341429.914.82%1.93%

steam

Others 65516215.48 2.32% 67435613.00 2.38% -2.85%

By operating segment

Japan and South

190375773.386.73%176568711.236.24%7.82%

Korea

Southeast Asia 803591068.14 28.42% 806827260.35 28.50% -0.40%

Europe and

452786828.5916.02%428358783.8815.13%5.70%

America

Others 394177816.29 13.94% 362087336.11 12.79% 8.86%

China 986178653.30 34.88% 1056646594.04 37.33% -6.67%

Operating division product category or operating segment contributing over 10% of operating revenue or operating profit:

□ Applicable □ Not applicable

The Company is subject to the disclosure requirements for listed companies engaging in textile and apparel as stated in Self-

Regulatory Guidelines of Shenzhen Stock Exchange for Listed Companies No.3 - Industry Information Disclosure.Unit: RMB

Gross YoY change in YoY change in YoY change in

Operating revenue Cost of sales profit operating cost of sales gross profit

margin revenue (%) (%) margin (%)

By operating division

Textile

and 2622625528.96 1992220046.81 24.04% -0.16% 2.39% -1.88%

apparel

By product category

Fabric

1850500289.501404398880.6624.11%-7.85%-5.07%-2.22%

products

Shirts 772125239.46 587821166.15 23.87% 24.82% 26.05% -0.74%

By operating segment

Southeast

803591068.14610152242.7824.07%-0.40%2.58%-2.21%

Asia

Europe

and 452786828.59 344297132.21 23.96% 5.70% 7.34% -1.16%

America

China 986178653.30 769918838.24 21.93% -6.67% -5.73% -0.78%

Core business data of the prior year restated according to the changed statistical caliber for the Reporting Period:

□ Applicable □ Not applicable

14Lu Thai Textile Co. Ltd. Interim Report 2025

Physical stores of the Company:

□ Yes □ No

New physical stores:

□ Yes □ No

Indicate by tick mark whether the Company discloses its top five franchised stores.□ Yes □ No

IV Other Information Required by Information Disclosure Guide for Companies Engaged

in Textile and Garment Services

1. Capacity

The Company’s own capacity

Industry

classification Item H1 2025 H1 2024

Total capacity (fabrics) (10000

meters) 13927.00 14415.00

Rate of capacity utilization 72% 76%

Fabric The Company’s convertible

bond fundraising project thePlants under construction “Overseas high-end fabricproduction line project(Phase I)” was in progress.Total capacity (apparel) (10000

standard pieces) 1359.00 1220.00

Apparel Rate of capacity utilization 95% 82%.Plants under construction

Year-on-year change in the rate of capacity utilization above 10%

√ Yes □ No

It was mainly due to the continuous increase in market expansion efforts in the apparel sector increased orders and improved rate

of capacity utilization.Overseas capacity

√ Yes □ No

Industry

classification Item Domestic Overseas

Percentage of capacity 69% 31%

Fabric Capacity layout Mainly in ShandongProvince Mainly in Southeast Asia

Rate of capacity utilization 70% 76%

Percentage of capacity 28% 72%

Apparel Capacity layout Mainly in ShandongProvince Mainly in Southeast Asia

Rate of capacity utilization 95% 95%

15Lu Thai Textile Co. Ltd. Interim Report 2025

2. Sales Model and Channels

Product sales channels and operation methods

a. Sales model

The Company adopted the order-based sales model. Relying on the self-owned trademark “Luthai” for its fabric sales it provided

customers with development and design plans based on customer needs fabrics and patterns leading the market fashion and

technology as well as functions and environmental protection. Shirts were mainly made according to the orders of customers at

home and abroad and sold by brand owners.The Company actively expanded its own brand portfolio. The Company operated its self-owned brand through self-owned

exclusive shops such as Lu Thai Exhibition and Sales Pavilion counters of affiliated stores in malls and e-networking marketing.expanding its business footprint through all channels. In addition the Company also offered “high-end custom” shirt and corporate

attire customization services to meet the diverse needs of the high-end service industry in a targeted manner.b. Sales channels

Direct sales: The Company focused on its own brand with a dedicated sales department responsible for managing the sales and

after-sales services of the Company’s products. The global market was divided into different sales regions for management with

unified planning and deployment to effectively handle fabric and apparel orders realizing product sales. Additionally to enrich its

terminal brand matrix and expand the market the Company upgraded the product offerings of the “Luthai 1987” brand to

continuously meet the diverse needs of end customers.Online sales: To keep up with the digitalization wave the Company was committed to expanding its online sales channels. On one

hand the Company built its own e-commerce platform and deeply integrated corporate resources to directly connect the brand

with consumers; on the other hand it formed strategic partnerships with major well-known online shopping platforms. After

transactions were completed through the internet the goods were accurately delivered to customers via express delivery.Unit: RMB

Gross YoY change in YoY change in

Sales YoY change in

Operating revenue Cost of sales profit operating gross profit

channels cost of sales

margin revenue margin

Online sales 749433.74 393103.99 47.55% -40.43% -36.03% -3.60%

Direct sales 1855360083.83 1405930298.22 24.22% -7.85% -5.08% -2.21%

OEM/ODM 766516011.39 585896644.60 23.56% 25.23% 26.27% -0.63%

Main reason for change

3. Selling Expense and Breakdown Thereof

Item H1 2025 H1 2024 Amount of Percentagechange of change Note

Salaries 32470002.40 32065926.42 404075.98 1.26%

Marketing expense 16455458.63 16111399.23 344059.40 2.14%

Depreciation charges 2417716.59 3344566.64 -926850.05 -27.71%

Business travel

expenses 3481536.38 3231195.05 250341.33 7.75%

Increased repair

Office operating fee 9776313.03 5569616.81 4206696.22 75.53%materials

consumption year-

16Lu Thai Textile Co. Ltd. Interim Report 2025

on-year

Others 5097062.74 2964017.13 2133045.61 71.96% Increased courierfees year-on-year

Total 69698089.77 63286721.28 6411368.49 10.13%

4. Franchise and Distribution

Franchisees and distributors recorded more than 30% of sales revenue

□ Yes □ No

5. Online Sales

Online sales recorded more than 30% of sales revenue

□ Yes □ No

Self-developed sales platforms

□ Yes □ No

Start of operation March 30 2009

Number of registered users 150000

Average number of active monthly users (AMU) 3100

Return rate of main brands 2.90%

Return rate of main types 2.90%

Cooperation with third-party sales platforms

□ Yes □ No

Online sales channels opened or closed by the Company

□ Applicable □ Not applicable

Impact on the Company in the Current Period and subsequent periods:

6. Agency Operation Model

Agency operation model involved

□ Yes □ No

7. Inventory

Inventory

Days of

Quantity of Year-on-year change in

Main products turnover of Inventory age Reason

inventory inventory balance

inventories

Fabrics

Within one

(100001033122.47-15.34%

year

meters)

Investment during the trial

production period of the

Fabrics

overseas product line project of

(10000 853.92 Over 1 year 18.98%

high-grade fabrics and stocking

meters)

of printing and dyeing fabrics in

advance

17Lu Thai Textile Co. Ltd. Interim Report 2025

Shirts (10000 Within one

28139.03-2.33%

pieces) year

Inventories increased

Shirts (10000 temporarily due to the need to

16.71 Over 1 year 9.33%

pieces) consolidate some orders into

batches for shipment.Reserves for falling prices of inventory

June 30 2025

Item

Carrying amount Falling price reserves or provision forimpairment on contract performance cost Carrying value

Raw materials 861633868.63 59031398.97 802602469.66

Work-in-progress 437205502.40 9493261.67 427712240.73

Inventory goods 952360327.28 183571540.67 768788786.61

Commissioned

products 13584476.92 13584476.92

Materials in transit 21512339.54 21512339.54

Total 2286296514.77 252096201.31 2034200313.46

Inventory information of retail channels such as franchised stores or distributors:

Not applicable.

8. Brand Building

Production and sales of brand clothing apparel and home textile products

□ Yes □ No

Self-owned brands

Main Target Price zone of

Trademark

Brand name product Characteristics consumer main Main sales areas City levels

name

types group products

Provincial

East China capital cities

Shirts Classic Business RMB500-

LTGRFF LTGRFF South China and and other

and suits business attire people 3000

Southwest China prefecture-

level cities

Provincial

East China capital cities

Business RMB500-

Luthai 1987 Luthai 1987 Shirts Elite men South China and and other

casual 3000

Southwest China prefecture-

level cities

Trademark right disputes

□ Applicable □ Not applicable

9. Others

Engaged in business related to apparel design

□ Yes □ No

Whether the Company held meetings for the placement of orders

□ Yes □ No

18Lu Thai Textile Co. Ltd. Interim Report 2025

V Non-Core Businesses Analysis

□ Applicable □ Not applicable

Unit: RMB

As % of profit

Amount Source/Reason Recurrent or not

before tax

Return on Gain on sales of held-for-trading

199543864.41 47.01% Not

investment financial assets

Gain/loss on changes Loss on changes in fair value of held-

-53613179.42 -12.63% Not

in fair value for-trading financial assets

Asset impairments -33600593.45 -7.92% Inventory valuation allowances Not

Non-operating Income of non-operating

8777411.25 2.07% Not

income compensation etc.Non-operating Expenses on non-operating

2915155.95 0.69% Not

expense compensation etc.VI Analysis of Assets and Liabilities

1. Significant Changes in Asset Composition

Unit: RMB

June 30 2025 December 31 2024 Change in Reason for

As % of As % of percentag any significant

Amount Amount

total assets total assets e (%) change

Monetary

2139114115.4015.41%2055856788.3714.76%0.65%

capitals

Accounts

747239605.775.38%849168539.276.10%-0.72%

receivable

Inventories 2034200313.46 14.66% 2019884406.30 14.50% 0.16%

Investment

18224212.480.13%18675533.630.13%0.00%

property

Long-term

equity 107611314.66 0.78% 120084271.29 0.86% -0.08%

investments

Fixed assets 5814725044.82 41.90% 6053755987.08 43.46% -1.56%

Construction in

134284190.340.97%95026709.370.68%0.29%

progress

Right-of-use

457019477.133.29%470238928.193.38%-0.09%

assets

Short-term

769528289.225.55%849686824.336.10%-0.55%

loans

Contract

157554001.781.14%191551003.791.38%-0.24%

liabilities

Long-term

408154596.912.94%396244110.212.84%0.10%

borrowings

Lease liabilities 80382387.04 0.58% 91353320.80 0.66% -0.08%

19Lu Thai Textile Co. Ltd. Interim Report 2025

2. Major Assets Overseas

□ Applicable □ Not applicable

Control Material

Asset Return As % of the

Operation measures to impairment

Asset Source value Location generated Company’s

model protect asset risk

(RMB) (RMB) net assets

safety (yes/no)

Main

Hong management

Incorporat 243497 Hong

Kong Trading personnel sent 8275955.58 2.43% Not

ed 659.56 Kong

company by the parent

company

Main

Investment management

Overseas Incorporat 469702 Southeast

and personnel sent 91303512.31 46.85% Not

bases ed 5821.09 Asia

production by the parent

company

3. Assets and Liabilities at Fair Value

□ Applicable □ Not applicable

Unit: RMB

Gain/loss

on fair- Cumulative Impairment

Purchased

value fair-value allowance Sold in the

Beginning in the Other Ending

Item changes in changes for the Reporting

amount Reporting change amount

the recorded in Reporting Period

Period

Reporting equity Period

Period

Financial

assets

1. Held-

for-trading

financial

assets 69349622 47700054 43459912 10493511

68159221.0.000.000.00

(excluding 2.45 18.91 61.20 58.38

derivative

financial

assets)

Derivative -

476450.190.000.000.000.000.000.00

financial 476450.19

assets

5. Other

non-current 82800000. 82800000.

0.000.000.000.000.000.00

financial 00 00

assets

Subtotal of -

77677267477000544345991211321511

financial 68635671. 0.00 0.00 0.00

2.6418.9161.2058.38

assets 97

10184900.-27435251.37499801.

Others 0.00 0.00 0.00 0.00

59120350.612220

Total of the 78695757 - - 0.00 47700054 43459912 27435251. 11696509

20Lu Thai Textile Co. Ltd. Interim Report 2025

above 3.23 68635671. 120350.61 18.91 61.20 22 59.58

Financial 15858713. 15022492.

0.000.000.000.000.00836220.67

liabilities 22 55

Content of other change:

Changes in receivables financing.Significant changes to the measurement attributes of the major assets in the Reporting Period:

□ Yes □ No

4. Restricted Asset Rights as at the Period-End

For details see Part VIII. VII. “22. Assets with Restricted Ownership or Right to Use” in this Report.VII Investments Made

1. Total Investment Amount

□ Applicable □ Not applicable

2. Major Equity Investments Made in the Reporting Period

□ Applicable □ Not applicable

3. Major Non-Equity Investments Ongoing in the Reporting Period

□ Applicable □ Not applicable

4. Financial Investments

(1) Securities Investments

□ Applicable □ Not applicable

No such cases in the Reporting Period.

(2) Investments in Derivative Financial Instruments

□ Applicable □ Not applicable

1) Derivative Investments for Hedging Purposes during the Reporting Period

□ Applicable □ Not applicable

Unit: RMB’0000

Gain/loss Cumulative Proportion

Initial on fair-

Purchased

fair-value Sold in the of closing

Type of Beginning value in the Endinginvestment changes Reporting investment

derivative amount

amount changes in

Reporting amount

recorded in Period amount in

the Periodequity the

Reporting Company’s

21Lu Thai Textile Co. Ltd. Interim Report 2025

Period ending net

assets

Forward

foreign

00004450.051435.53014.550.31%

exchange

settlement

Foreign

exchange 0 0 0 0 65920 0 65920 6.79%

option

Total 0 0 0 0 70370.05 1435.5 68934.55 7.10%

Whether

significant

changes

occurred to

the

Company’s

accounting

policy and

specific

accounting

principles No significant changes

derivatives

in the

Reporting

Period

compared

to the

Reporting

Period

1. As at June 30 2025 the Company held eight undue financial derivatives contracts with a total value of

Actual

USD104.20 million of which USD4.20 million were in forward foreign exchange settlements and USD100 million

gain/loss in

were in foreign exchange options.the

2. From January to June 2025 the total amount of all due financial derivatives of the Company was equivalent to

Reporting

USD2 million which were all forward foreign exchange settlements and implemented based on contracts incurring

Period

a loss of RMB118300.The Company conducts foreign exchange (FX) derivative transactions with the intention of hedging. Specifically

Effectivene

the business is carried out to fix costs avoid exchange rate risks and improve resistance against FX rate

ss of

fluctuations. As a result the Company has gained better capabilities of avoiding and preventing the risks of FX rate

hedges

fluctuations and the financial robustness of the Company has been enhanced.Capital

source for

The Company’s self-owned funds

derivative

investment

Analysis on The Company conducted derivatives products transaction in order for hedging. And the forward settlement hedging

risks and was operated by installments with the relevant amount not more than the planned derivatives products transactions.control And all derivatives products transaction was zero-deposit. Meanwhile the Company had a complete risk control

measures system for sufficient analysis and prevention of possible risks such as market risk liquidity risk and credit risk

of operation risk and risk of laws and regulation.derivative 1. Market risk: When the international and domestic economic situations change the corresponding changes in

products exchange rates and interest rates may have an adverse impact on the financial derivative transactions of the

held in the Company. Precautions: The Company chooses financial instruments with simple structures high liquidity and

Reporting controllable risk and strictly controls the scale of derivative transactions performing them by stages and in batches.Period Means such as extension and balance settlement can be adopted to ensure contract performance after the contract

(including expires.

22Lu Thai Textile Co. Ltd. Interim Report 2025

but not 2. Liquidity risk and credit risk: Credit risk arises when the Company or counterparties in transactions couldn’t

limited to perform contracts due now to liquidity or other factors that result in further economic loss. Precautions: The

market derivative transactions can only be done with financial institutions qualified for derivative transactions as

risk authorized by relevant national authorities or financial or foreign exchange authorities in the country or region

liquidity where the Company operates. Derivative transactions with other institutions or individuals are not allowed so as to

risk credit control related risk concerning counterparties.risk 3. Internal risk control: Derivative transactions are highly specialized and complex. Therefore there is a risk of loss

operation in derivative transactions due to the imperfect internal control system when business is performed. Precautions: The

risk law Company should strictly implement Management Policy for Investments in Securities and Derivative Transactions

risk etc.) of Lu Thai Textile Co. Ltd. continuously optimize the business operation process and authorization management

system strengthen professional ethics education and business training for relevant personnel clarify job

responsibilities engage in derivative transaction business strictly within the scope of authorization and establish a

timely reporting system for abnormal conditions to avoid operational risks.

4. Risk of laws and regulation: Derivative transactions of the Company must be strictly in compliance with relevant

national laws and regulations. Otherwise signed contracts commitments and other legal documents may entail

compliance risk and regulatory risk in terms of effectiveness and enforceability. Precautions: The Company should

strengthen the supervision and inspection of the standardization of derivative transactions the effectiveness of

internal control mechanism and the authenticity of information disclosure to avoid possible legal risks. The

Company has fulfilled relevant approval procedures for its derivative transactions business which is in line with

the relevant national laws regulations the Articles of Association theManagement Rules for Derivative Trading of

Lu Thai Company and the Proposal on the Company’s Derivative Transaction Plan deliberated and adopted at the

22nd meeting of the 10th session of the Board of Directors held on May 28 2024 and fulfilled the relevant

information disclosure obligations.Changes of

market

prices or

fair values

in the

Reporting

Period of

the

invested

derivatives. In accordance with the relevant provisions and guidelines of the Accounting Standards for Business Enterprises No.And the 22 - Recognition and Measurement of Financial Instruments and Accounting Standards for Business Enterprises

analysis on No. 37 - Presentation of Financial Instruments issued by the Ministry of Finance the Company took the relevant

the fair accounting measures for its business of FX derivative transactions to reflect the relevant items in the balance sheet

value of the and the income statement. During the Reporting Period the Company determined the fair value of foreign

derivatives exchange option based on the bank’s forward option quotations at the end of each month.should

include the

specific use

methods

and the

relevant

assumption

s and

parameters.Lawsuit (if

N/A

applicable)

Disclosure

date of

board of

directors May 29 2024

announcem

ent on

approval of

derivative

23Lu Thai Textile Co. Ltd. Interim Report 2025

investment

(if any)

2) Derivative Investments for Speculative Purposes during the Reporting Period

□ Applicable □ Not applicable

No such cases in the Reporting Period.

5. Use of Funds Raised

□ Applicable □ Not applicable

No such cases in the Reporting Period.VIII Sale of Major Assets and Equity Interests

1. Sale of Major Assets

□ Applicable □ Not applicable

No such cases in the Reporting Period.

2. Sale of Major Equity Interests

□ Applicable □ Not applicable

IX Major Subsidiaries

□ Applicable □ Not applicable

Major fully/majority-owned subsidiaries and those minority-owned subsidiaries with an over 10% effect on the Company’s net

profit:

Unit: RMB’0000

Relationshi

Principal Registered Operating Operating

Name p with the Total assets Net assets Net profit

activity capital revenue profit

Company

LuFeng

Company Subsidiary Fabric 70616.00 170738.42 126733.68 49336.03 3093.20 2844.32

Limited

Shandong

Lulian New

Subsidiary Fabric 90000.00 62523.63 54767.05 5282.67 -2335.59 -2319.52

Materials

Co. Ltd.Subsidiaries obtained or disposed in the Reporting Period:

□ Applicable □ Not applicable

Information about major majority- and minority-owned subsidiaries:

LuFeng Company Limited is the holding subsidiary of the Company. Registration place: Zibo Shandong; registered capital:

RMB706.16 million. It is mainly engaged in manufacturing and selling textile printing and dyeing products and the products of

clothing and garments and it were authenticated to be high-tech enterprise in October 2014. During the Reporting Period due to

the global decline in consumer demand the number of orders decreased leading to a drop in both operating revenue and net profit.

24Lu Thai Textile Co. Ltd. Interim Report 2025

Shandong Lulian New Materials Co. Ltd. is the wholly-owned subsidiary of the Company. Registration place: Zibo Shandong;

registered capital: RMB900 million. It is mainly engaged in manufacturing and selling functional fabrics. During the Reporting

Period the operating revenue and net profit were basically the same year-on-year.X Structured Bodies Controlled by the Company

□ Applicable □ Not applicable

See “X Equity in Other Entities” of Part VIII.XI Risks Facing the Company and Countermeasures

1. Impact of economic environment: Amid ongoing risks such as the global economic environment and geopolitical conflicts as

well as weak economic growth the Company continues to face challenges in terms of international trade policies and market

changes. In response the Company will rely on its global business network and vertical industrial chain further utilize various

resources at home and abroad and keep developing domestic and overseas markets.

2. Price fluctuation of raw materials: Cotton is the major production material of the Company and the price of cotton is impacted

by market supply and demand climate policy exchange rate and other factors. Therefore the Company coordinates domestic and

overseas production deeply studies the information of global cotton market properly works out procurement strategy and gives

full play to the advantages of global procurement of high-quality raw cotton.

3. Change of exchange rate: The Company has a large ratio in import and export business which is mostly settled in USD. In

recent years the bi-directional fluctuations in RMB exchange rate have become increasingly normal with a significant increase in

exchange rate flexibility. To lower the impact of exchange rate fluctuations the Company stuck to the risk-neutral management

philosophy. Based on actual needs arising from production and operations it incorporated exchange rate risks into routine

operations management and flexibly allocated different types and maturities of foreign exchange derivatives for hedging purposes

to minimize the influence of exchange rate risks on its operating results. Firstly the Company appropriately conducted foreign

exchange hedging using financial derivatives such as forwards swaps and option portfolios to avoid currency risks. Secondly the

Company made reasonable arrangement on settlement day and currency and vigorously promoted cross-border settlement with

RMB to avoid exchange rate-related risks. Thirdly the Company adjusted the Renminbi and foreign-currency liabilities structure

to actively prevent currency fluctuation risks.XII The Formulation and Implementation of the Market Value Management Policy and

Valuation Improvement Plan

Has the Company established a market value management system

□ Yes □ No

Has the Company disclosed a valuation improvement plan

□ Yes □ No

In accordance with the China Securities Regulatory Commission’s Guideline No. 10 for Listed Companies — Market Value

Management companies with long-term market value below par are required to disclose their plans for improving the company’s

valuation. As at December 31 2024 the price of LTTC-shares had fallen into a long-term below-par situation. Therefore in line

with its industry position development strategy and business plans the Company has formulated and disclosed a valuation

enhancement plan. For specific details please refer to the Valuation Enhancement Plan of Lu Thai Textile Co. Ltd. published

by the Company on March 1 2025 on http://www.cninfo.com.cn.

25Lu Thai Textile Co. Ltd. Interim Report 2025

XIII Implementation of the Action Plan for “Dual Enhancement of Quality and Profitability”

Indicate whether the Company has disclosed the action plan for “Dual Enhancement of Quality and Profitability”.□ Yes □ No

26Lu Thai Textile Co. Ltd. Interim Report 2025

Part IV Corporate Governance Environmental and Social Matters

I Change of Directors Supervisors and Senior Executives

□ Applicable □ Not applicable

Name Office title Type of change Date Reason

Retirement after

Zhou Zhiji Independent Director May 7 2025 Dismissed

expiration of term

Retirement after

Qu Dongmei Independent Director June 8 2025 Board Change

expiration of term

Retirement after

Peng Yanli Independent Director June 8 2025 Board Change

expiration of term

Yu Mingtao Independent Director Elected May 7 2025 Job transfer

Zhu Beina Independent Director Elected June 9 2025 Board Change

Wei Jian Independent Director Elected June 9 2025 Board Change

Chairman of the Board Retirement after

Shang Chenggang June 8 2025 Board Change

of Supervisors expiration of term

Shang Chenggang Senior management Appointed June 9 2025 Board Change

Retirement after

Liu Zilong Supervisor June 8 2025 Board Change

expiration of term

Liu Zilong Senior management Appointed June 9 2025 Board Change

Retirement after

Dong Shibing Supervisor June 8 2025 Board Change

expiration of term

Dong Shibing Senior management Appointed June 9 2025 Board Change

II Interim Dividend Plan

□ Applicable □ Not applicable

Bonus shares for every ten shares (share) 0

Dividend for every 10 shares (RMB) (tax inclusive) 1.00

Bonus issue from capital reserves (share/10 shares) 0

Total shares as the basis for the profit distribution proposal

817306563

(share)

Cash dividends (RMB) (tax inclusive) 81730656.30

Cash dividends in other forms (such as share repurchase)

0.00

(RMB)

Total cash dividends (including those in other forms) (RMB) 81730656.30

Distributable profit (RMB) 6247640013.07

Total cash dividends (including those in other forms) as % of

100%

total profit distribution

Cash dividend policy

If the Company is in a mature development stage and has plans for any significant expenditure in profit allocation the ratio of

cash dividends in the profit allocation shall be 40% or above.Details about the proposal for profit distribution and converting capital reserve into share capital

The Company plans to distribute a cash dividend of RMB1.00(inclusive of tax) for every 10 shares based on a capital base of

27Lu Thai Textile Co. Ltd. Interim Report 2025

817306563 shares. The total amount of dividends calculated on this basis is RMB81730656.30. The personal income tax for A

Share shall be subject to related regulations under CS [2015] No. 101 Notice on Certain Question about the Differentiated

Individual Income Tax Policy for Cash Dividend of Listed Companies jointly issued by Ministry of Finance SAT and CSRC; and

that for B Share shall be conversed to HKD based on the central parity rate on interbank exchange market released by the People’s

Bank of China on the following day after the Board of Directors’ approval (for domestic individual shareholders tax is paid

pursuant to CS [2015] No. 101; for foreign shareholders tax is free pursuant to CSZ (1994) No. 020 regulations; and non-

residential corporate shareholders is entitled to a 10% reduction of enterprise income tax according to related regulations under

Enterprise Income Tax Law of the People’s Republic of China). Since the Company is in the period of transferring convertible

bonds into shares the profit distribution will be conducted based on the total share capital on the equity registration date for

implementing this profit distribution plan with no change in the amount per share.III Equity Incentive Plans Employee Stock Ownership Plans or Other Incentive Measures

for Employees

□ Applicable □ Not applicable

No such cases in the Reporting Period.IV. Environmental Information Disclosure

Whether the listed company and its major subsidiaries are included in the list of enterprises legally required to disclose

environmental information

□ Yes □ No

Number of enterprises included in the

list of enterprises legally required to 4

disclose environmental information

No. Company name Environmental information disclosure report index

Enterprise Environmental Information Legal Disclosure System

1 Lu Thai Textile Co. Ltd.

(http://221.214.62.226:8090/EnvironmentDisclosure/)

Enterprise Environmental Information Legal Disclosure System

2 LuFeng Company Limited

(http://221.214.62.226:8090/EnvironmentDisclosure/)

Shandong Lulian New Enterprise Environmental Information Legal Disclosure System

Materials Co. Ltd. (http://221.214.62.226:8090/EnvironmentDisclosure/)

Zibo Xinsheng Thermal Enterprise Environmental Information Legal Disclosure System

Power Co. Ltd. (http://221.214.62.226:8090/EnvironmentDisclosure/)

The Company is subject to the disclosure requirements for listed companies engaging in textile and apparel as stated in Self-

Regulatory Guidelines of Shenzhen Stock Exchange for Listed Companies No.3 - Industry Information Disclosure.Related environmental accidents information

No such cases for the Reporting Period.V Social Responsibility

Not applicable.

28Lu Thai Textile Co. Ltd. Interim Report 2025

Part V Significant Events

I Commitments of the Company’s Actual Controller Shareholders Related Parties and

Acquirers as well as the Company Itself and Other Entities Fulfilled in the Reporting

Period or Ongoing at the Period-End

□ Applicable □ Not applicable

Date of

Type of Term of

Commitment Promisor Details of commitment commitme Fulfillment

commitment commitment

nt making

1. Not intervene the Company’s

operation and management beyond

the authority and not occupy the

Company’s interests. 2. From the

issuance date of this commitment to

the completion of the implementation

of the Company’s public offering of

A-share convertible corporate bonds

if the CSRC makes other new

regulatory provisions on remedial

Dilution of at measures for returns and the

sight returns commitment and the above

Controlli

Commitments on public commitment fails to meet the From May

made in time offering A- requirements of the CSRC the May 23 23 2019 to

sharehold On-going

of IPO or share Company/I promise to issue 2019 April 8

er actual

refinancing convertible supplementary commitment then in 2026

controller

corporate accordance with the latest regulations

bonds of CSRC. 3. Commitment is made to

fulfill the Company’s relevant

remedial measures for returns and

any commitment made herein by the

Company/me. If the Company/I

violate(s) such commitment and

cause(s) losses to the Company or

investors the Company/I will bear

the compensation responsibility to

the Company or investors in

accordance with the law.

1. Commitment is made not to

transfer benefits to other units or

individuals free of charge or under

unfair conditions and no other ways

Dilution of at

damaging the interests of the

Directors sight returns

Company will be taken. 2. I will

Commitments and on public From May

strictly abide by the budget

made in time senior offering A- May 23 23 2019 to

management of the Company and On-going

of IPO or executive share 2019 April 8

accept the strict supervision and

refinancing s of the convertible 2026

management of the Company to

Company corporate

avoid waste or excessive

bonds

consumption. Any position-related

consumption behaviors of me will

occur within the scope necessary for

the performance of my duties. 3.

29Lu Thai Textile Co. Ltd. Interim Report 2025

Commitment is made not to use the

Company’s assets to engage in

investment and consumption

activities unrelated to the

performance of duties. 4.Commitment is made that the

remuneration system developed by

the Board of Directors or the

Remuneration Committee is linked to

the implementation of the Company’s

remedial measures for returns. 5.Commitment is made that the

conditions for exercising the Equity

Incentive Plan to be issued in the

future will be linked to the

implementation of the Company’s

remedial measures for returns. 6.From the issuance date of this

commitment to the completion of the

implementation of the Company’s

public offering of A-share

convertible corporate bonds if the

CSRC makes other new regulatory

provisions on remedial measures for

returns and the commitment and the

above commitment fails to meet the

requirements of the CSRC I promise

to issue supplementary commitment

then in accordance with the latest

regulations of CSRC. 7. Commitment

is made to fulfill the Company’s

relevant remedial measures for

returns and any commitment made

herein by me. If I violate such

commitment and causes losses to the

Company or investors I will bear the

compensation responsibility to the

Company or investors in accordance

with the law.Executed on

Yes

time or not

II Occupation of the Company’s Capital by the Controlling Shareholder or any of Its

Related Parties for Non-Operating Purposes

□ Applicable □ Not applicable

No such cases in the Reporting Period.III Irregularities in the Provision of Guarantees

□ Applicable □ Not applicable

No such cases in the Reporting Period.

30Lu Thai Textile Co. Ltd. Interim Report 2025

IV Engagement and Disengagement of Independent Auditor

Are the interim financial statements audited

□ Yes □ No

The interim financial statements have not been audited.V Explanations Given by the Board of Directors and the Supervisory Committee Regarding

the Independent Auditor’s “Modified Opinion” on the Financial Statements of the

Reporting Period

□ Applicable □ Not applicable

VI Explanations Given by the Board of Directors Regarding the Independent Auditor’s

“Modified Opinion” on the Financial Statements of Last Year

□ Applicable □ Not applicable

VII Insolvency and Reorganization

□ Applicable □ Not applicable

No such cases in the Reporting Period.VIII Legal Matters

Significant lawsuits and arbitrations:

□ Applicable □ Not applicable

No such cases in the Reporting Period.Other legal matters:

□ Applicable □ Not applicable

IX Punishments and Rectifications

□ Applicable □ Not applicable

No such cases in the Reporting Period.X Credit Quality of the Company as well as its Controlling Shareholder and Actual

Controller

□ Applicable □ Not applicable

XI Major Related-Party Transactions

1. Continuing Related-Party Transactions

□ Applicable □ Not applicable

No such cases in the Reporting Period.

31Lu Thai Textile Co. Ltd. Interim Report 2025

2. Related-Party Transactions Regarding Purchase or Sales of Assets or Equity Interests

□ Applicable □ Not applicable

No such cases in the Reporting Period.

3. Related-Party Transactions Regarding Joint Investments in Third Parties

□ Applicable □ Not applicable

No such cases in the Reporting Period.

4. Credits and Liabilities with Related Parties

□ Applicable □ Not applicable

No such cases in the Reporting Period.

5. Transactions with Related Finance Companies

□ Applicable □ Not applicable

The Company did not make deposits in receive loans or credit from and was not involved in any other finance business with any

related finance company or any other related parties.

6. Transactions with Related Parties by Finance Companies Controlled by the Company

□ Applicable □ Not applicable

The finance company controlled by the Company did not make deposits receive loans or credit from and was not involved in any

other finance business with any related parties.

7. Other Major Related-Party Transactions

□ Applicable □ Not applicable

No such cases in the Reporting Period.XII Major Contracts and Execution thereof

1. Entrustment Contracting and Leases

(1) Entrustment

□ Applicable □ Not applicable

No such cases in the Reporting Period.

(2) Contracting

□ Applicable □ Not applicable

No such cases in the Reporting Period.

32Lu Thai Textile Co. Ltd. Interim Report 2025

(3) Leases

□ Applicable □ Not applicable

No such cases in the Reporting Period.

2. Major Guarantees

□ Applicable □ Not applicable

Unit: RMB’0000

Guarantees provided by the Company as the parent and its subsidiaries for external parties (exclusive of those for subsidiaries)

Disclosure

Guarantee

date of the

Actual Actual Counter- Having for a

line of Line of Type of Collateral Term of

Obligor occurrence guarantee guarantee expired or related

guarantee guarantee guarantee (if any) guarantee

date amount (if any) not party or

announce

not

ment

Guarantees provided by the Company for its subsidiaries

Disclosure

Guarantee

date of the

Actual Actual Counter- Having for a

line of Line of Type of Collateral Term of

Obligor occurrence guarantee guarantee expired or related

guarantee guarantee guarantee (if any) guarantee

date amount (if any) not party or

announce

not

ment

Three years

since the

Wholly- approval of

August 26 August 24 Joint-

owned 23623.38 0 N/A N/A the Board Yes Yes

2022 2022 liability

subsidiary of Directors

of the

Company

Three years

since the

Wholly- approval of

July 1 June 30 Joint-

owned 7158.6 0 N/A N/A the Board Yes Yes

2023 2023 liability

subsidiary of Directors

of the

Company

Total approved line of Total actual amount of

guarantee in the 0 such guarantees in the 0

Reporting Period (B1) Reporting Period (B2)

Total approved line of Total actual balance of

guarantee at the end of such guarantees at the

30781.980

the Reporting Period end of the Reporting

(B3) Period (B4)

Guarantees provided between subsidiaries

Disclosure

Guarantee

date of the

Actual Actual Counter- Having for a

line of Line of Type of Collateral Term of

Obligor occurrence guarantee guarantee expired or related

guarantee guarantee guarantee (if any) guarantee

date amount (if any) not party or

announce

not

ment

33Lu Thai Textile Co. Ltd. Interim Report 2025

Three years

since the

Wholly- approval of

July 9 July 6 Joint-

owned 25055.1 8607.49 N/A N/A the Board Not Yes

2024 2024 liability

subsidiary of Directors

of the

Company

Three years

since the

Wholly- approval of

August 30 August 28 Joint-

owned 21475.8 3579.3 N/A N/A the Board Not Yes

2024 2024 liability

subsidiary of Directors

of the

Company

Total approved line of Total actual amount of

guarantee in the 0 such guarantees in the 12039.39

Reporting Period (C1) Reporting Period (C2)

Total approved line of Total actual balance of

guarantee at the end of such guarantees at the

46530.912186.79

the Reporting Period end of the Reporting

(C3) Period (C4)

Total guarantee amount (total of the three kinds of guarantees above)

Total approved line of Total actual guarantee

guarantee in the amount in the

012039.39

Reporting Period Reporting Period

(A1+B1+C1) (A2+B2+C2)

Total approved line of Total actual guarantee

guarantee at the end of balance at the end of

77312.8812186.79

the Reporting Period the Reporting Period

(A3+B3+C3) (A4+B4+C4)

Total actual guarantee amount (A4+B4+C4)

1.26%

as % of the Company’s net assets

Of which:

Balance of guarantees provided for

shareholders actual controller and their related 0

parties (D)

Balance of debt guarantees provided directly or

indirectly for obligors with an over 70% asset- 0

liability ratio (E)

Amount by which the total guarantee amount

exceeds 50% of the Company’s net assets (F)

Total of the three amounts above (D+E+F) 0

Joint responsibilities possibly borne or already

borne in the Reporting Period for undue N/A

guarantees (if any)

Explanation about external guarantee violating

N/A

established procedure (if any)

Compound guarantees:

None

The Company is subject to the disclosure requirements for listed companies engaging in textile and apparel as stated in Self-

34Lu Thai Textile Co. Ltd. Interim Report 2025

Regulatory Guidelines of Shenzhen Stock Exchange for Listed Companies No.3 - Industry Information Disclosure.Whether the Company provides guarantees or financial assistance for dealers

□ Yes □ No

3. Cash Entrusted for Wealth Management

□ Applicable □ Not applicable

Unit: RMB’0000

Overdue amount

Specific type Capital resources Amount incurred Undue Balance Overdue amount with provision for

impairment

Bank financial The Company’s

820004700000

products self-owned funds

Brokerage The Company’s

42472.930017.100

financial products self-owned funds

The Company’s

Others 0 40000 0 0

self-owned funds

Total 124472.9 117017.1 0 0

Particulars of entrusted cash management with single significant amount or low security bad liquidity and no capital preservation

□ Applicable □ Not applicable

Whether there is the case where the principal cannot be recovered at maturity or other case which may cause impairment for

entrusted asset management

□ Applicable □ Not applicable

4. Other Major Contracts

□ Applicable □ Not applicable

No such cases in the Reporting Period.XIII Other Significant Events

□ Applicable □ Not applicable

The Company had no other significant events to be stated during the Reporting Period.XIV Significant Events of Subsidiaries

□ Applicable □ Not applicable

35Lu Thai Textile Co. Ltd. Interim Report 2025

Part VI Share Changes and Shareholder Information

I Share Changes

1. Share Changes

Unit: share

Before Increase/decrease in the Reporting Period (+/-) After

Shares as

Shares as dividend

Percentag New dividend converted Percentage

Number Others Subtotal Number

e (%) issues converted from (%)

from profit capital

reserves

I. Restricted - -

26608920.33%25370920.31%

shares 123800 123800

1. Shares held

by State

2. Shares held

by state-

owned legal

person

3. Shares held

by other - -

26608920.33%25370920.31%

domestic 123800 123800

investors

Among

which: Shares

held by

domestic

legal person

Shares held

by domestic 2660892 0.33% 2537092 0.31%

123800123800

natural person

4. Shares held

by other

foreign

investors

Among

which: Shares

held by

foreign legal

person

Shares held

by foreign

natural person

II.

8147693

Unrestricted 814645118 99.67% 124212 124212 99.69%

36Lu Thai Textile Co. Ltd. Interim Report 2025

1. RMB

5887008

ordinary 588576603 72.01% 124212 124212 72.03%

Domestically 2260685

22606851527.66%27.66%

listed foreign 15

3. Overseas

listed foreign

4. Other

III. Total 8173064

817306010100.00%412412100.00%

shares 22

Reasons for share changes:

□ Applicable □ Not applicable

a) Due to the fact that the Company had issued convertible A-share bonds on April 9 2020 convertible bonds were converted to

412 shares in the period from the beginning of 2025 to June 30 2025.

b) The shares held by the directors supervisors and senior executives shall be adjusted in accordance with relevant regulations on

senior management share management.Approval of share changes:

□ Applicable □ Not applicable

Transfer of share ownership:

□ Applicable □ Not applicable

Progress on any share repurchases:

□ Applicable □ Not applicable

Progress on reducing the repurchased shares by means of centralized bidding:

□ Applicable □ Not applicable

Effects of share changes on the basic and diluted earnings per share equity per share attributable to the Company’s ordinary

shareholders and other financial indicators of the prior year and the prior accounting period respectively:

□ Applicable □ Not applicable

See relevant contents of “IV Key Financial Information” under “Part II Corporate Information and Key Financial Information”.Other information that the Company considers necessary or is required by the securities regulator to be disclosed:

□ Applicable □ Not applicable

2. Changes in Restricted Shares

□ Applicable □ Not applicable

Unit: share

Restricted

Restricted Restricted

shares Restricted

Name of the shares shares Restricted

increased shares amount at Restricted shares relieved date

shareholders amount at the relieved of reasons

of the the period-end

period-begin the period

period

Zhang 435225 435225 Senior Follow the regulations on

37Lu Thai Textile Co. Ltd. Interim Report 2025

Zhanqi management executive share management

lock-up

Senior

Yu management Follow the regulations on

287325287325

Shouzheng lock-up executive share management

Senior

Zhang management Follow the regulations on

283275283275

Keming lock-up executive share management

Senior

management Follow the regulations on

Li Wenji 260000 65000 195000

lock-up executive share management

Senior

Shang management Follow the regulations on

247500247500

Chenggang lock-up executive share management

Senior

management Follow the regulations on

Wang Jiabin 235275 58800 176475

lock-up executive share management

Senior

management Follow the regulations on

Guo Heng 225000 225000

lock-up executive share management

Senior

management Follow the regulations on

Du Lixin 187500 187500

lock-up executive share management

Senior

Lyu management Follow the regulations on

150000150000

Wenquan lock-up executive share management

Senior

management Follow the regulations on

Xu Feng 142500 142500

lock-up executive share management

Senior

Other

management Follow the regulations on

restricted 207292 207292

lock-up executive share management

shareholders

Total 2660892 123800 0 2537092 -- --

II Issuance and Listing of Securities

□ Applicable □ Not applicable

III Total Number of Shareholders and Their Shareholdings

Unit: share

Total number of ordinary 47402 Total number of preferred shareholders 0

shareholders at the period- with resumed voting rights at the period-

38Lu Thai Textile Co. Ltd. Interim Report 2025

end end (if any) (see Note 8)

5% or greater shareholders or the top 10 shareholders (exclusive of shares lent in refinancing)

Quantity of Shares in pledge marked

holding Increase/de or frozen

Nature Sharehold Number of

shares at crease Number of

Name of the of ing non-

the end of during the restricted

shareholders sharehol percentag restricted

the Reporting shares held

der e (%) shares held Status Number

Reporting Period

Period

Domesti

Zibo Lucheng c non-

Textile state- 14035358 14035358

17.17% 0 0 N/A 0

Investment Co. owned 3 3

Ltd. legal

person

Tailun

Foreign

(Thailand) 11523240 11523240

legal 14.10% 0 0 N/A 0

Textile Co. 0 0

person

Ltd.Central Huijin State-

Assets owned

2.43% 19884100 0 0 19884100 N/A 0

Management legal

Co. Ltd. person

National Social

Security Fund Others 1.82% 14910051 0 0 14910051 N/A 0

Portfolio 413

ICBC Credit

Suisse

Innovation

Power Stock Others 1.33% 10890000 -1110000 0 10890000 N/A 0

Type Securities

Investment

Fund

FEDERATED

HERMES

GLOBAL

INVESTMENT

(CAYMAN) Foreign

MASTER SPC legal 0.74% 6024131 -310580 0 6024131 N/A 0

OBOAFTAO person

FEDERATED

HERMES

EMG ASIA

EQUITY FD

MASTER S.P.Dacheng China

Securities Asset

Others 0.55% 4493500 0 0 4493500 N/A 0

Management

Plan

Domesti

Hao Jing c natural 0.53% 4335000 0 0 4335000 N/A 0

person

Yinhua China

Securities Asset Others 0.52% 4243912 0 0 4243912 N/A 0

Management

39Lu Thai Textile Co. Ltd. Interim Report 2025

Plan

GF China

Securities Asset

Others 0.50% 4089200 0 0 4089200 N/A 0

Management

Plan

Strategic investors or

general corporations

becoming top-ten

N/A

shareholders due to placing

of new shares (if any) (see

Note 3)

Zibo Lucheng Textile Investment Co. Ltd. is the largest shareholder of the Company and the

Related or acting-in-concert actual controller. Tailun (Thailand) Textile Co. Ltd. is the second largest shareholder as well as

parties among the sponsor of foreign capital of the Company. All of other shareholders are people holding public A

shareholders above share or public B share and the Company is not able to confirm whether there is associated

relationship or concerted action among other shareholders.Explain if any of the

shareholders above was

involved in entrusting/being N/A

entrusted with voting rights

or waiving voting rights

Special account for share

repurchases (if any) among

N/A

the top 10 shareholders (see

note 11)

Shareholdings of the top ten non-restricted shareholders (exclusive of shares lent in refinancing and senior management lock-up

shares)

Type of shares

Name of the shareholders Number of unrestricted shares held at the period-end Type of

Number

RMB

Zibo Lucheng Textile 14035358

140353583 ordinary

Investment Co. Ltd. 3

Domestical

Tailun (Thailand) Textile ly listed 11523240

115232400

Co. Ltd. foreign 0

RMB

Central Huijin Assets

19884100 ordinary 19884100

Management Co. Ltd.shares

RMB

National Social Security

14910051 ordinary 14910051

Fund Portfolio 413

ICBC Credit Suisse

RMB

Innovation Power Stock

10890000 ordinary 10890000

Type Securities Investment

Fund

FEDERATED HERMES

GLOBAL INVESTMENT

Domestical

FD (CAYMAN) MASTER

ly listed

SPC OBOAFTAO 6024131 6024131

foreign

FEDERATED HERMES

EMG ASIA EQUITY FD

MASTER S.P.

40Lu Thai Textile Co. Ltd. Interim Report 2025

RMB

Dacheng China Securities

4493500 ordinary 4493500

Asset Management Plan

RMB

Hao Jing 4335000 ordinary 4335000

RMB

Yinhua China Securities

4243912 ordinary 4243912

Asset Management Plan

RMB

GF China Securities Asset

4089200 ordinary 4089200

Management Plan

Explanation on connected

relationship among the top

ten shareholders of tradable

share not subject to trading Zibo Lucheng Textile Investment Co. Ltd. is the largest shareholder of the Company and the

moratorium as well as actual controller. Tailun (Thailand) Textile Co. Ltd. is the second largest shareholder as well as

among the top ten sponsor of foreign capital of the Company. All of other shareholders are people holding public A

shareholders of tradable share or public B share and the Company is not able to confirm whether there is associated

share not subject to trading relationship or concerted action among other shareholders.moratorium and top ten

shareholders or explanation

on acting-in-concert

Particular about shareholder

participate in the securities

N/A

lending and borrowing

business (if any) (note 4)

5% or greater shareholders top 10 shareholders and Top 10 unrestricted shareholders involved in refinancing shares lending

□ Applicable □ Not applicable

Changes in top 10 shareholders and top 10 unrestricted shareholders due to refinancing shares lending/return compared with the

prior period

□ Applicable □ Not applicable

Indicate by tick mark whether any of the top 10 ordinary shareholders or the top 10 unrestricted ordinary shareholders of the

Company conducted any promissory repo during the Reporting Period.□ Yes □ No

No such cases in the Reporting Period.IV Change in Shareholdings of Directors Supervisors and Senior Executives

□ Applicable □ Not applicable

Number

Number Number

of granted of granted

Beginnin Increase Decrease restricted

Ending restricted restricted

Incum g in the in the shares

sharehold shares at shares at

Name Office title bent/f sharehold Current Current granted in

ing the the

ormer ing Period Period the

(share) period- period-

(share) (share) (share) Current

begin end

Period

(share) (share)

(share)

Liu Chairman and Incum

148290148290

Zibin President bent

Xu Vice Chairman Incum

41Lu Thai Textile Co. Ltd. Interim Report 2025

Zhinan bent

Director Vice

Controller of

Liu Incum

Global

Deming bent

Marketing

Department

Xu Incum

Director

Jianlyu bent

Zheng

Incum

Huishen Director

bent

Director Vice

President

Controller of

Global

Marketing

Department

Dean of Lu

Thai

Zhang Incum

Engineering 580300 580300

Zhanqi bent

Technology

Research

Institute

General

Manager of

LuFeng

Company

Limited

Director Chief

Accountant

Zhang Director of the Incum

377700377700

Keming Financial bent

Management

Department

Du Director and Incum

250000250000

Lixin Chief Engineer bent

Independent Incum

Mingta

Director bent

Zhu Independent Incum

Beina Director bent

Quan Independent Incum

Yuhua Director bent

Wei Independent Incum

Jian Director bent

Zheng Board Incum

4000040000

Weiyin Secretary bent

President

Shang Assistant

Incum

Chengg Director of the 330000 330000

bent

ang garment

product line

President

Yu Assistant Head

Incum

Shouzh of the Energy 383100 383100

bent

eng and

Environmental

42Lu Thai Textile Co. Ltd. Interim Report 2025

Protection

Department of

the Company

General

Manager of

Zibo Xinsheng

Thermal Power

Co. Ltd.Luthai (Hong

Liu Incum

Kong) Textile 10000 10000

Zilong bent

Co. Ltd.Chairman of

the Labor

Union

Manager of the

Logistics

Dong Management Incum

50005000

Shibing Department bent

General

Manager of

Zibo Banyang

Villa Hotel

Co. Ltd.Head of

Guo Functional Incum

300000300000

Heng Fabric Product bent

Line

Deputy Head

of the Yarn-

dyed Fabric

Lyu Product Line

Incum

Wenqua Manager of the 200000 200000

bent

n Yarn-dyed

Production

Management

Department

Deputy Head

of the Yarn-

dyed Fabric

Product Line

Xu Incum

Head of 190000 190000

Feng bent

Overseas

Operation and

Management

Centre

Zhou Independent Resign

Zhiji Director ation

Independent Resign

Dongm

Director ation

Peng Independent Resign

Yanli Director ation

Total -- -- 2814390 0 0 2814390 0 0 0

43Lu Thai Textile Co. Ltd. Interim Report 2025

V Change of the Controlling Shareholder or the Actual Controller

Change of the controlling shareholder in the Reporting Period

□ Applicable □ Not applicable

No such cases in the Reporting Period.Change of the Actual Controller in the Reporting Period

□ Applicable □ Not applicable

No such cases in the Reporting Period.VI Particulars of Preferred Shares

□ Applicable □ Not applicable

No preferred shares in the Reporting Period.

44Lu Thai Textile Co. Ltd. Interim Report 2025

Part VII Bonds

□ Applicable □ Not applicable

I Enterprise Bonds

□ Applicable □ Not applicable

No enterprise bonds in the Reporting Period.II Corporate Bonds

□ Applicable □ Not applicable

No corporate bonds in the Reporting Period.III Debt Financing Instruments of Non-financial Enterprises

□ Applicable □ Not applicable

No such cases in the Reporting Period.IV Convertible Corporate Bonds

□ Applicable □ Not applicable

1. Issuance of Convertible Bonds

Pursuant to the approval document titled the Approval of the Public Issue of Convertible Corporate Bonds of Lu Thai Textile Co. Ltd.(ZH.J.X.K. Document No. 299) issued by the CSRC the Company publicly issued 14 million convertible corporate bonds on April 9

2020 each with a par value of RMB100 with a total issuance amount of RMB1.4 billion.

2. Guarantors of Convertible Bonds and the Top 10 Holders in the Reporting Period

Public Offering of A-Share Convertible Corporate Bonds of Lu Thai

Name of convertible bonds

Textile Co. Ltd. in 2020

Number of holders at the end of the Reporting

6886

Period

Guarantor of the Company’s convertible bonds N/A

Significant changes in profitability assets

N/A

condition and credit status of guarantors

Top 10 convertible bond holders are as follows:

Number of Amount of As % of

Nature of convertible bonds convertible bonds convertible bonds

No. Name of holders

holders held at the period- held at the period- held at the

end (share) end (RMB) period-end

China Construction Bank - E Fund

1 Others 699222 69922200.00 5.00%

Enhanced Income Bond Securities

45Lu Thai Textile Co. Ltd. Interim Report 2025

Investment Fund

China Merchants Bank Co. Ltd. – Bosera

2 CSI Convertible Bonds and Exchangeable Others 617492 61749200.00 4.41%

Bonds ETF

Zhuhai Liben Private Equity Fund

Management Partnership (Limited

3 Others 611286 61128600.00 4.37%

Partnership) - Liben Growth Fund No. 2

Private Securities Investment Fund

Dajia Life Insurance Co. Ltd. - Traditional

4 Others 549071 54907100.00 3.92%

Product

Shanghai Pudong Development Bank Co.

5 Ltd. - E Fund Yuxiang Return Bond Others 495122 49512200.00 3.54%

Securities Investment Bond

Fuguo Fumin Fixed Income Pension

6 Product - China Construction Bank Others 420069 42006900.00 3.00%

Corporation

ICBC Credit Suisse Tianfeng Fixed Benefit

7 Others 402940 40294000.00 2.88%

Pension Product - Bank of China Limited

State-

owned

8 Guosen Securities Co. Ltd. 392430 39243000.00 2.80%

legal

person

China Merchants Bank Co. Ltd. -

9 Dongfanghong Juli Bond Securities Others 327356 32735600.00 2.34%

Investment Fund

Huatai Yousheng Convertible Bond Fixed

10 Income Pension Product - China Merchants Others 313590 31359000.00 2.24%

Bank Co. Ltd.

3. Changes in the Convertible Bond in the Reporting Period

□ Applicable □ Not applicable

Unit: RMB

Increase/decrease of the change

Name of convertible bonds Before After

Into shares Redeemed Resold

Public Offering of A-Share

Convertible Corporate Bonds of Lu 1399844700.00 3500.00 1399841200.00

Thai Textile Co. Ltd. in 2020

4. Accumulative Conversion

□ Applicable □ Not applicable

Converted

shares as %

of total

Accumulati UnconverteAccumulati shares

Name of Total Total

ve amount ve shares

Unconverte d amount

issued by

convertible Start date circulation amount converted d amount as % ofconverted the

bonds (piece) (RMB) (RMB) total

(RMB) (share) Company amount

before the

start date of

conversion

Public From 14000000 14000000 158800.00 17557 0.00% 13998412 99.99%

46Lu Thai Textile Co. Ltd. Interim Report 2025

Offering of October 15 00.00 00.00

A-Share 2020 to

Convertible April 8

Corporate 2026

Bonds of

Lu Thai

Textile Co.Ltd. in

2020

5. Previous Adjustments and Correction of Conversion Price

Latest price

as at the end

Adjustment date Adjusted

Name of Notes on adjustment of of the

of conversion conversion Disclosure time

convertible bonds conversion price Reporting

price price (RMB)

Period

(RMB)

The Company implemented

July 9 2020 8.91 July 2 2020 the 2019 Equity Distribution

Plan on July 9 2020.The Company implemented

the initial grant of the 2021

June 7 2021 8.76 June 4 2021 restricted share incentive

scheme with the listing date

set for June 7 2021.The Company implemented

June 18 2021 8.71 June 10 2021 the 2020 Equity Distribution

Plan on June 18 2021.The Company implemented

the grant of reserved shares

under the 2021 restricted

March 22 2022 8.68 March 18 2022

stock incentive scheme with

the listing date set for March

Public Offering 22 2022.of A-Share The Company implemented

Convertible June 23 2022 8.61 June 16 2022 the 2021 Equity Distribution

Corporate Bonds Plan on June 23 2022. 8.49

of Lu Thai

Textile Co. Ltd. The Company completed the

in 2020 formalities for cancellation

May 26 2023 8.73 May 26 2023 of the 23935748

repurchased B shares on

May 25 2023.The Company implemented

June 16 2023 8.63 June 9 2023 the 2022 Equity Distribution

Plan on June 16 2023.The Company completed the

formalities for cancellation

March 4 2024 8.87 March 2 2024 of the 46176428

repurchased B shares on

March 1 2024.The Company implemented

June 19 2024 8.74 June 12 2024 the 2023 Equity Distribution

Plan on June 19 2024.November 8 The Company implemented

8.64 November 1 2024

2024 the 2024 Interim Equity

47Lu Thai Textile Co. Ltd. Interim Report 2025

Distribution Plan on

November 8 2024.The Company implemented

December 19 the 2024 Q3 Equity

8.59 December 12 2024

2024 Distribution Plan on

December 19 2024.The Company implemented

June 20 2025 8.49 June 13 2025 the 2024 Equity Distribution

Plan on June 20 2025.

6. The Company’s Liabilities Credit Changes at the Period-end and Cash Arrangements to Repay Debts

in Future YearsFor the relevant indicators please refer to the Part VII Bonds – “VI The Major Accounting Data and the Financial Indicators of theRecent 2 Years of the Company up the Period-end”.The credit rating of the Company’s convertible bonds for the reporting period is AA+ which has not changed compared with that

of the same period of last year.V Losses of Scope of Consolidated Financial Statements during the Reporting Period

Exceeding 10% of Net Assets up the Period-end of Last Year

□ Applicable □ Not applicable

VI The Major Accounting Data and the Financial Indicators of the Recent 2 Years of the

Company up the Period-End

Unit: RMB’0000

Item June 30 2025 December 31 2024 Increase/Decrease

Current ratio 2.10 3.39 -38.05%

Asset-liability ratio 27.76% 29.49% -1.73%

Quick ratio 1.43 2.25 -36.44%

H1 2025 H1 2024 Change (%)

Net profit after deducting

22561.5326373.13-14.45%

non-recurring profit or loss

Debt/EBITDA ratio 27.07% 17.30% 9.77%

Interest cover (times) 10.00 4.76 110.08%

Cash-to-interest cover (times) 6.78 9.47 -28.41%

EBITDA interest coverage

15.609.8558.38%

ratio (times)

Rate of redemption 100.00% 100.00%

Interest coverage 100.00% 100.00%

48Lu Thai Textile Co. Ltd. Interim Report 2025

Part VIII Financial Statements

I Independent Auditor’s Report

Are these interim financial statements audited by an independent auditor

□ Yes □ No

They are unaudited by such an auditor.II Financial Statements

Currency unit for the financial statements and the notes thereto: RMB

1. Consolidated Balance Sheet

Prepared by Lu Thai Textile Co. Ltd.June 30 2025

Unit: RMB

Item Ending balance Beginning balance

Current assets:

Monetary capitals 2139114115.40 2055856788.37

Held-for-trading financial assets 1049351158.38 693972672.64

Derivative financial assets

Notes receivable 39030160.44 51339990.35

Accounts receivable 747239605.77 849168539.27

Receivables financing 37499801.20 10184900.59

Prepayments 132539783.79 94340345.68

Other receivables 24152797.11 23107489.38

Including: Interest receivable

Dividend receivable

Inventories 2034200313.46 2019884406.30

Current portion of non-current assets 156297393.15 154176585.64

Other current assets 20328326.17 59034547.73

Total current assets 6379753454.87 6011066265.95

Non-current assets:

Long-term equity investments 107611314.66 120084271.29

Investments in other equity instruments

Other non-current financial assets 82800000.00 82800000.00

Investment property 18224212.48 18675533.63

Fixed assets 5814725044.82 6053755987.08

Construction in progress 134284190.34 95026709.37

49Lu Thai Textile Co. Ltd. Interim Report 2025

Right-of-use assets 457019477.13 470238928.19

Intangible assets 327890760.99 333384747.50

Goodwill 20563803.29 20563803.29

Long-term deferred expenses 3550288.75 5634560.27

Deferred income tax assets 138328342.11 148530519.94

Other non-current assets 392586573.69 569954322.70

Total non-current assets 7497584008.26 7918649383.26

Total assets 13877337463.13 13929715649.21

Current liabilities:

Short-term loans 769528289.22 849686824.33

Held-for-trading financial liabilities 836220.67 15858713.22

Accounts payable 174248558.77 272079091.51

Advances from customers

Contract liabilities 157554001.78 191551003.79

Payroll payable 235283537.70 301227361.89

Taxes payable 44600830.71 57261948.01

Other payables 95144804.38 17437799.60

Including: Interest payable

Dividends payable 75441113.64 441113.64

Current portion of non-current

1539699402.2927788571.75

liabilities

Other current liabilities 25008287.11 42829460.18

Total current liabilities 3041903932.63 1775720774.28

Non-current liabilities:

Long-term borrowings 408154596.91 396244110.21

Bonds payable 1509420449.46

Lease liabilities 80382387.04 91353320.80

Long-term payables

Long-term payroll payable 58494991.36 58494991.36

Provisions

Deferred income 142360938.77 145395121.11

Deferred income tax liabilities 120638187.77 131519037.79

Other non-current liabilities

Total non-current liabilities 810031101.85 2332427030.73

Total liabilities 3851935034.48 4108147805.01

Owners’ equity:

Share capital 817306422.00 817306010.00

Other equity instruments 71383259.63 71383438.11

Including: Preferred shares

50Lu Thai Textile Co. Ltd. Interim Report 2025

Perpetual bonds

Capital reserves 178746397.11 178518667.31

Less: Treasury stock

Other comprehensive income 155094789.13 166925985.26

Specific reserve 4210110.35

Surplus reserves 1271429282.44 1271429282.44

General reserve

Retained earnings 7211650131.88 6933165006.16

Total equity attributable to owners of

9709820392.549438728389.28

the Company as the parent

Equity of non-controlling interests 315582036.11 382839454.92

Total owners’ equity 10025402428.65 9821567844.20

Total liabilities and owners’ equity 13877337463.13 13929715649.21

Legal representative: Liu Zibin Chief Accountant: Zhang Keming Financial Manager: Zhang Keming

2. Balance Sheet of the Parent Company

Unit: RMB

Item Ending balance Beginning balance

Current assets:

Monetary capitals 1353726696.69 1098738844.86

Held-for-trading financial assets 467547982.90 348853051.29

Derivative financial assets 0.00 0.00

Notes receivable 26216718.14 34955445.32

Accounts receivable 382599376.57 381343801.66

Receivables financing 14489532.18 8604909.79

Prepayments 28724594.76 37339639.22

Other receivables 1556331125.47 1444344599.59

Including: Interest receivable

Dividend receivable 225000000.00

Inventories 884750161.11 833923667.33

Including: Data resources

Current portion of non-current assets 156297393.15 154176585.64

Other current assets 1640361.86 1285523.29

Total current assets 4872323942.83 4343566067.99

Non-current assets:

Long-term equity investments 3873729258.91 3886201497.79

Investments in other equity instruments

Other non-current financial assets 70800000.00 70800000.00

Investment property 59481373.20 61235932.80

51Lu Thai Textile Co. Ltd. Interim Report 2025

Fixed assets 1756666692.45 1829970463.91

Construction in progress 30660219.90 25572141.50

Right-of-use assets 85331620.88 94200828.47

Intangible assets 188535711.72 191804122.33

Long-term deferred expenses 36284.53 253990.93

Deferred income tax assets 78218616.25 83559877.27

Other non-current assets 352206076.93 502059650.58

Total non-current assets 6495665854.77 6745658505.58

Total assets 11367989797.60 11089224573.57

Current liabilities:

Short-term loans

Held-for-trading financial liabilities

Derivative financial liabilities

Notes payable 0.00 60000000.00

Accounts payable 172299986.65 202868261.19

Advances from customers

Contract liabilities 49995098.60 62755259.28

Payroll payable 153523012.31 196441126.83

Taxes payable 25774923.78 38807426.46

Other payables 16009050.73 14071692.51

Including: Interest payable

Dividends payable 441113.64 441113.64

Liabilities held for sale

Current portion of non-current

1537652137.1426337442.97

liabilities

Other current liabilities 20314072.96 31411042.17

Total current liabilities 1975568282.17 632692251.41

Non-current liabilities:

Long-term borrowings 408154596.91 396244110.21

Bonds payable 1509420449.46

Including: Preferred shares

Perpetual bonds

Lease liabilities 79739796.30 88480054.92

Long-term payables

Long-term payroll payable 58494991.36 58494991.36

Provisions

Deferred income 108286441.16 110138851.32

Deferred income tax liabilities 86813230.24 98766520.96

Other non-current liabilities

52Lu Thai Textile Co. Ltd. Interim Report 2025

Total non-current liabilities 741489055.97 2261544978.23

Total liabilities 2717057338.14 2894237229.64

Owners’ equity:

Share capital 817306422.00 817306010.00

Other equity instruments 71383259.63 71383438.11

Including: Preferred shares

Perpetual bonds

Capital reserves 246282690.66 246054960.86

Less: Treasury stock 0.00 0.00

Other comprehensive income -33510.92 -35886.10

Specific reserve 33042.22 0.00

Surplus reserves 1268320542.80 1268320542.80

Retained earnings 6247640013.07 5791958278.26

Total owners’ equity 8650932459.46 8194987343.93

Total liabilities and owners’ equity 11367989797.60 11089224573.57

3. Consolidated Income Statement

Unit: RMB

Item H1 2025 H1 2024

1. Revenue 2827110139.70 2830488685.61

Including: Operating revenue 2827110139.70 2830488685.61

2. Costs and expenses 2525003547.23 2502834949.04

Including: Cost of sales 2168474896.26 2131993492.13

Taxes and surcharges 31239434.94 29125385.82

Selling expense 69698089.77 63286721.28

Administrative expense 162947077.39 158805160.69

R&D expense 100446619.98 115374597.19

Financial expenses -7802571.11 4249591.93

Including: Interest expense 47165800.27 48731472.34

Interest income 34380042.79 24797577.48

Add: Other income 11191654.96 14929113.83

Return on investment (“-” for loss) 199543864.41 -3289446.38

Including: Share of profit or loss of joint ventures and associates 1393710.04 8619094.53

Income from the derecognition of financial assets at amortized cost

(“-” for loss)

Exchange gain (“-” for loss)

Net gain on exposure hedges (“-” for loss)

Gain on changes in fair value (“-” for loss) -53613179.42 -112539827.27

Credit impairment loss (“-” for loss) -6567343.20 587454.42

53Lu Thai Textile Co. Ltd. Interim Report 2025

Asset impairment loss (“-” for loss) -33600593.45 -34719445.19

Asset disposal income (“-” for loss) -459023.14 -232868.16

3. Operating profit (“-” for loss) 418601972.63 192388717.82

Add: Non-operating income 8777411.25 2878019.80

Less: Non-operating expense 2915155.95 2366685.20

4. Profit before tax (“-” for loss) 424464227.93 192900052.42

Less: Income tax expense 56505920.02 18864805.79

5. Net profit (“-” for net loss) 367958307.91 174035246.63

5.1 By operating continuity

5.1.1 Net profit from continuing operations (“-” for net loss) 367958307.91 174035246.63

5.1.2 Net profit from discontinued operations (“-” for net loss)

5.2 By ownership

5.2.1 Net profit attributable to shareholders of the Company as

360215726.72169559969.54

the parent (“-” for net loss)

5.2.1 Net profit attributable to non-controlling interests (“-” for

7742581.194475277.09

net loss)

6. Other comprehensive income net of tax -11831196.13 9376489.57

Attributable to owners of the Company as the parent -11831196.13 9376489.57

6.1 Other comprehensive income that will not be reclassified to

profit or loss

6.1.1 Changes caused by re-measurements on defined benefit

schemes

6.1.2 Other comprehensive income that will not be reclassified

to profit or loss under the equity method

6.1.3 Changes in the fair value of investments in other equity

instruments

6.1.4 Changes in the fair value arising from changes in own

credit risk

6.1.5 Other

6.2 Other comprehensive income that will be reclassified to

-11831196.139376489.57

profit or loss

6.2.1 Other comprehensive income that will be reclassified to

profit or loss under the equity method

6.2.2 Changes in the fair value of investments in other debt

obligations

6.2.3 Other comprehensive income arising from the

reclassification of financial assets

6.2.4 Credit impairment allowance for investments in other

debt obligations

6.2.5 Reserve for cash flow hedges

6.2.6 Differences arising from the translation of foreign

-11771402.389340942.61

currency-denominated financial statements

6.2.7 Other -59793.75 35546.96

Other comprehensive income attributable to non-controlling

interests

7. Total comprehensive income 356127111.78 183411736.20

Attributable to owners of the parent company 348384530.59 178936459.11

Attributable to non-controlling interests 7742581.19 4475277.09

54Lu Thai Textile Co. Ltd. Interim Report 2025

8. Earnings per share

8.1 Basic earnings per share 0.44 0.21

8.2 Diluted earnings per share 0.40 0.19

Where business combinations under common control occurred in the Current Period the net profit achieved by the acquirees

before the combinations was RMB0.00 with the amount for the same period of last year being RMB0.00.Legal representative: Liu Zibin Chief Accountant: Zhang Keming Financial Manager: Zhang Keming

4. Income Statement of the Parent Company

Unit: RMB

Item H1 2025 H1 2024

1. Operating revenue 1380651274.50 1468386291.35

Less: Cost of sales 1047508741.72 1111556899.05

Taxes and surcharges 19174516.84 18109295.49

Selling expense 39895772.35 41139342.57

Administrative expense 89681738.86 96570932.90

R&D expense 74371809.78 79830730.20

Financial expenses 5147001.10 -3675230.34

Including: Interest expense 27250219.49 27601294.75

Interest income 23939018.62 19298232.20

Add: Other income 5875520.30 11824461.76

Return on investment (“-” for loss) 527782025.32 14834483.02

Including: Share of profit or loss of joint ventures and joint

1393710.048619094.53

ventures

Income from the derecognition of financial assets at

amortized cost (“-” for loss)

Net gain on exposure hedges (“-” for loss)

Gain on changes in fair value (“-” for loss) -81239371.48 -73211657.14

Credit impairment loss (“-” for loss) 829519.78 2881097.53

Asset impairment loss (“-” for loss) -988284.62 -2519219.13

Asset disposal income (“-” for loss) -230391.26 1256454.63

2. Operating profit (“-” for loss) 556900711.89 79919942.15

Add: Non-operating income 5108491.01 2179686.89

Less: Non-operating expense 140072.91 56573.70

3. Profit before tax (“-” for loss) 561869129.99 82043055.34

Less: Income tax expense 24456794.18 5350341.11

4. Net profit (“-” for net loss) 537412335.81 76692714.23

4.1 Net profit from continuing operations (“-” for net loss) 537412335.81 76692714.23

4.2 Net profit from discontinued operations (“-” for net loss)

5. Other comprehensive income net of tax 2375.18 11090.23

6.1 Other comprehensive income that will not be reclassified to

55Lu Thai Textile Co. Ltd. Interim Report 2025

profit or loss

6.1.1 Changes caused by re-measurements on defined benefit

schemes

6.1.2 Other comprehensive income that will not be

reclassified to profit or loss under the equity method

6.1.3 Changes in the fair value of investments in other equity

instruments

6.1.4 Changes in the fair value arising from changes in own

credit risk

6.1.5 Other

6.2 Other comprehensive income that will be reclassified to

2375.1811090.23

profit or loss

6.2.1 Other comprehensive income that will be reclassified to

profit or loss under the equity method

6.2.2 Changes in the fair value of investments in other debt

obligations

6.2.3 Other comprehensive income arising from the

reclassification of financial assets

6.2.4 Credit impairment allowance for investments in other

debt obligations

6.2.5 Reserve for cash flow hedges

6.2.6 Differences arising from the translation of foreign

currency-denominated financial statements

6.2.7 Other 2375.18 11090.23

6. Total comprehensive income 537414710.99 76703804.46

7. Earnings per share

8.1 Basic earnings per share 0.66 0.09

8.2 Diluted earnings per share 0.58 0.10

5. Consolidated Cash Flow Statement

Unit: RMB

Item H1 2025 H1 2024

1. Cash flows from operating activities:

Proceeds from sale of commodities and rendering of services 2803150193.86 2870197776.21

Tax rebates 36500294.08 34473335.94

Cash generated from other operating activities 25319329.63 15241585.40

Subtotal of cash generated from operating activities 2864969817.57 2919912697.55

Payments for commodities and services 1542792623.46 1495937361.55

Cash paid to and for employees 839987267.54 815258158.98

Taxes paid 115718037.97 84393030.40

Cash used in other operating activities 102478247.64 72902493.93

Subtotal of cash used in operating activities 2600976176.61 2468491044.86

Net cash flow from operating activities 263993640.96 451421652.69

2. Cash flows from investing activities:

Proceeds from disinvestment 3896975363.58 366961000.00

56Lu Thai Textile Co. Ltd. Interim Report 2025

Return on investment 201151635.48 1477671.32

Net proceeds from the disposal of fixed assets intangible assets

8019136.005007425.81

and other long-lived assets

Net proceeds from the disposal of subsidiaries and other business

units

Cash generated from other investing activities 286072065.68 55092528.36

Subtotal of cash generated from investing activities 4392218200.74 428538625.49

Payments for the acquisition of fixed assets intangible assets and

63023782.20133899391.95

other long-lived assets

Payments for investments 4273214000.00 466000000.00

Cash used in other investing activities 52675673.76 187380600.00

Subtotal of cash used in investing activities 4388913455.96 787279991.95

Net cash generated from/used in investing activities 3304744.78 -358741366.46

3. Cash flows from financing activities:

Capital contributions received

Including: Cash received by subsidiaries from capital

contributions of minority shareholders

Borrowings raised 795615516.62 1312631494.80

Cash generated from other financing activities

Subtotal of cash generated from financing activities 795615516.62 1312631494.80

Cash paid for debt repayment 858948490.13 919859118.54

Cash paid for distribution of dividend profit or payment of

123410101.61149684828.86

interest

Including: Dividends paid by subsidiaries to non-controlling

interests

Cash used in other financing activities 9250108.12 47144251.24

Subtotal of cash used in financing activities 991608699.86 1116688198.64

Net cash generated from/used in financing activities -195993183.24 195943296.16

4. Effect of foreign exchange rates changes on cash and cash

27327178.498936611.65

equivalents

5. Net increase in cash and cash equivalents 98632380.99 297560194.04

Add: Opening balance of cash and cash equivalents 1371412259.52 1353615305.93

6. Closing balance of cash and cash equivalents 1470044640.51 1651175499.97

6. Cash Flow Statement of the Parent Company

Unit: RMB

Item H1 2025 H1 2024

1. Cash flows from operating activities:

Proceeds from sale of commodities and rendering of services 1290886102.43 1488240200.81

Tax rebates 6773725.66 6378709.40

Cash generated from other operating activities 22231794.27 19682005.66

Subtotal of cash generated from operating activities 1319891622.36 1514300915.87

Payments for commodities and services 878878825.92 832282435.46

57Lu Thai Textile Co. Ltd. Interim Report 2025

Cash paid to and for employees 395452125.89 404265209.55

Taxes paid 66045293.01 42371401.25

Cash used in other operating activities 57536555.13 41833676.11

Subtotal of cash used in operating activities 1397912799.95 1320752722.37

Net cash flow from operating activities -78021177.59 193548193.50

2. Cash flows from investing activities:

Proceeds from disinvestment 2082614651.22 320961000.00

Return on investment 299534627.43 5054535.92

Net proceeds from the disposal of fixed assets intangible assets

19406643.41798733.70

and other long-lived assets

Net proceeds from the disposal of subsidiaries and other business

0.000.00

units

Cash generated from other investing activities 1163480433.41 1388052365.00

Subtotal of cash generated from investing activities 3565036355.47 1714866634.62

Payments for the acquisition of fixed assets intangible assets and

15352948.1514125317.07

other long-lived assets

Payments for investments 2259738000.00 420000000.00

Net payments for the acquisition of subsidiaries and other

0.000.00

business units

Cash used in other investing activities 913402246.98 1316340560.00

Subtotal of cash used in investing activities 3188493195.13 1750465877.07

Net cash generated from/used in investing activities 376543160.34 -35599242.45

3. Cash flows from financing activities:

Capital contributions received

Borrowings raised 20000000.00 763875061.70

Cash generated from other financing activities 92001000.00

Subtotal of cash generated from financing activities 20000000.00 855876061.70

Cash paid for debt repayment 8463198.74 387245597.90

Cash paid for distribution of dividend profit or payment of

111038442.44137445683.64

interest

Cash used in other financing activities 9220803.28 229318998.82

Subtotal of cash used in financing activities 128722444.46 754010280.36

Net cash generated from/used in financing activities -108722444.46 101865781.34

4. Effect of foreign exchange rates changes on cash and cash

5369627.731982612.10

equivalents

5. Net increase in cash and cash equivalents 195169166.02 261797344.49

Add: Opening balance of cash and cash equivalents 507628886.80 765705926.26

6. Closing balance of cash and cash equivalents 702798052.82 1027503270.75

7. Consolidated Statements of Changes in Owners’ Equity

58Lu Thai Textile Co. Ltd. Interim Report 2025

H1 2025

Unit: RMB

H1 2025

Equity attributable to owners of the Company as the parent company

Equity of

Item Other equity instruments Other TotalLess: non-

Share Capital comprehe Specific Surplus General Retained controllin owners’

capital Preferred Perpetual

Treasury Others Subtotal equity

Others reserves nsive reserve reserves reserve earnings g interests

shares bonds stock income

1. Ending balances of the 8173060 7138343 1785186 1669259 1271429 6933165 9438728 3828394 9821567

prior year 10.00 8.11 67.31 85.26 282.44 006.16 389.28 54.92 844.20

Add: Adjustments for

changed accounting

policies

Adjustments for

corrections of previous

errors

Others

2. Beginning balances of 8173060 7138343 1785186 1669259 1271429 6933165 9438728 3828394 9821567

the year 10.00 8.11 67.31 85.26 282.44 006.16 389.28 54.92 844.20

3. Increase/decrease in the 227729.8 4210110. 2784851 2710920 2038345

412.00-178.4811831196725741

period (“-” for decrease) 0 35 25.72 03.26 84.45

6.138.81

3.1 Total comprehensive 3602157 3483845 7742581. 3561271

1183119

income 26.72 30.59 19 11.78

6.13

3.2 Capital increased and 227729.8 227963.3 227963.3

412.00-178.48

reduced by owners 0 2 2

3.2.1 Ordinary shares

412.003374.763786.763786.76

increased by shareholders

3.2.2 Capital increased by

holders of other equity

instruments

3.2.3 Share-based 224307.7 224307.7 224307.7

payments included in 5 5 5

59Lu Thai Textile Co. Ltd. Interim Report 2025

owners’ equity

3.2.4 Other -178.48 47.29 -131.19 -131.19

----

3.3 Profit distribution 8173060 8173060 7500000 1567306

1.001.000.0001.00

3.3.1 Appropriation to

surplus reserves

3.3.2 Appropriation to

general reserve

----

3.3.3 Appropriation to

8173060817306075000001567306

owners (or shareholders)

1.001.000.0001.00

3.2.4 Other

3.4 Transfers within

owners’ equity

3.4.1 Increase in capital (or

share capital) from capital

reserves

3.4.2 Increase in capital (or

share capital) from surplus

reserves

3.4.3 Loss offset by surplus

reserves

3.4.4 Changes in defined

benefit pension schemes

transferred to retained

earnings

3.4.5 Other comprehensive

income transferred to

retained earnings

3.4.6 Other

4210110.4210110.4210110.

3.5 Specific reserve

353535

3.5.1 Increase in the period 7971427. 7971427. 7971427.

60Lu Thai Textile Co. Ltd. Interim Report 2025

333333

3761316.3761316.3761316.

3.5.2 Used in the period

989898

3.6 Other

4. Ending balances of the 8173064 7138325 1787463 1550947 4210110. 1271429 7211650 9709820 3155820 1002540

period 22.00 9.63 97.11 89.13 35 282.44 131.88 392.54 36.11 2428.65

H1 2024

Unit: RMB

H1 2024

Equity attributable to owners of the Company as the parent

Non-

Item Other equity instruments Other Retaine TotalLess: controll

Share Preferr Perpetu Capital compre Specific Surplus General d owners’Treasur Others Subtotal ing

capital ed al Others reserves hensive reserve reserves reserve earning equityy stock interests

shares bonds income s

12606676249230896174

1. Balances as at the end 863607 71383 334792 193438 131343 386661

61015.57543.06905.67997.

of the prior year 634.00 677.78 614.76 720.78 141.63 091.90

34078070

Add: Adjustments

for changed accounting

policies

Adjustments

for corrections of

previous errors

Others

12606676249230896174

2. Balances as at the 863607 71383 334792 193438 131343 386661

61015.57543.06905.67997.

beginning of the year 634.00 677.78 614.76 720.78 141.63 091.90

34078070

3. Increase/decrease in - - -

937642567763310718724475276348

the period (“-” for 462427 -86.69 150391 193252

89.5760.32203.06967.5877.09244.67

decrease) 38.00 321.46 660.78

3.1 Total comprehensive 93764 169559 178936 44752 183411

income 89.57 969.54 459.11 77.09 736.20

61Lu Thai Textile Co. Ltd. Interim Report 2025

-----

3.2 Capital increased and

462427-86.691503911932523381433814

reduced by owners

38.00321.46660.7885.3785.37

----

3.2.1 Ordinary shares

462427153711199954199954

increased by shareholders

38.00878.22616.22616.22

3.2.2 Capital increased

by holders of other equity

instruments

3.2.3 Share-based

332053320533205

payments included in

15.9615.9615.96

owners’ equity

193252193252

3.2.4 Other -86.69 40.80 193252

614.89614.89

660.78

---

3.3 Profit distribution 106249 106249 106249

766.48766.48766.48

3.3.1 Appropriation to

surplus reserves

3.3.2 Appropriation to

general reserve

---

3.3.3 Appropriation to

106249106249106249

owners (or shareholders)

766.48766.48766.48

3.2.4 Other

3.4 Transfers within

owners’ equity

3.4.1 Increase in capital

(or share capital) from

capital reserves

3.4.2 Increase in capital

(or share capital) from

surplus reserves

3.4.3 Loss offset by

surplus reserves

62Lu Thai Textile Co. Ltd. Interim Report 2025

3.4.4 Changes in defined

benefit pension schemes

transferred to retained

earnings

3.4.5 Other

comprehensive income

transferred to retained

earnings

3.4.6 Other

256772567725677

3.5 Specific reserve

60.3260.3260.32

3.5.1 Increase in the 40900 40900 40900

period 00.00 00.00 00.00

152221522215222

3.5.2 Used in the period

39.6839.6839.68

3.6 Other

12606682579302696938

4. Balances as at the end 817364 71383 184401 186060 140719 25677 391136

61015.67746.79873.16242.

of the period 896.00 591.09 293.30 .00 631.20 60.32 368.99

34133837

8. Statements of Changes in Owners’ Equity of the Parent Company

H1 2025

Unit: RMB

H1 2025

Other equity instruments Other

Item Less: Total

Perpetu Capital comprehen Specific Surplus RetainedShare capital Preferred Treasury Others owners’

al Others reserves sive reserve reserves earnings

shares stock equity

bonds income

1. Ending balances of the 71383438 24605496 1268320 5791958 8194987

817306010.00-35886.10

prior year .11 0.86 542.80 278.26 343.93

Add: Adjustments

63Lu Thai Textile Co. Ltd. Interim Report 2025

for changed accounting

policies

Adjustments for

corrections of previous

errors

Others

2. Beginning balances of 71383438 24605496 1268320 5791958 8194987

817306010.00-35886.10

the year .11 0.86 542.80 278.26 343.93

3. Increase/decrease in the 45568173 45594511

412.00-178.48227729.802375.1833042.22

period (“-” for decrease) 4.81 5.53

3.1 Total comprehensive 53741233 53741471

2375.18

income 5.81 0.99

3.2 Capital increased and

412.00-178.48227729.80227963.32

reduced by owners

3.2.1 Ordinary shares

412.003374.763786.76

increased by shareholders

3.2.2 Capital increased by

holders of other equity

instruments

3.2.3 Share-based

payments included in 224307.75 224307.75

owners’ equity

3.2.4 Other -178.48 47.29 -131.19

3.3 Profit distribution 81730601 81730601.00.00

3.3.1 Appropriation to

surplus reserves

3.3.2 Appropriation to

8173060181730601

owners (or shareholders).00.00

3.3.3 Other

3.4 Transfers within

owners’ equity

64Lu Thai Textile Co. Ltd. Interim Report 2025

3.4.1 Increase in capital

(or share capital) from

capital reserves

3.4.2 Increase in capital

(or share capital) from

surplus reserves

3.4.3 Loss offset by

surplus reserves

3.4.4 Changes in defined

benefit pension schemes

transferred to retained

earnings

3.4.5 Other

comprehensive income

transferred to retained

earnings

3.4.6 Other

3.5 Specific reserve 33042.22 33042.22

3.5.1 Increase in the 1525200. 1525200.

period 00 00

1492157.1492157.

3.5.2 Used in the period

7878

3.6 Other

4. Ending balances of the 71383259 24628269 1268320 6247640 8650932

817306422.00-33510.9233042.22

period .63 0.66 542.80 013.07 459.46

H1 2024

Unit: RMB

H1 2024

Other equity instruments Other

Item Less: TotalShare Capital comprehen Specific Surplus Retained

Treasury Others owners’

capital Preferred Perpetual Others reserves sive reserve reserves earnings

shares bonds stock equityincome

65Lu Thai Textile Co. Ltd. Interim Report 2025

1. Ending balances of the 8636076 7138367 3961726 1934387 1257552 5923889 8319125

-41439.79

prior year 34.00 7.78 49.00 20.78 275.70 542.37 618.28

Add: Adjustments for

changed accounting policies

Adjustments for

corrections of previous

errors

Others

2. Beginning balances of the 8636076 7138367 3961726 1934387 1257552 5923889 8319125

-41439.79

year 34.00 7.78 49.00 20.78 275.70 542.37 618.28

-----

3. Increase/decrease in the

4624273-86.691503913193252611090.23295570532927447

period (“-” for decrease)

8.0021.4660.782.25.39

3.1 Total comprehensive 7669271 76703804

11090.23

income 4.23 .46

----

3.2 Capital increased and

4624273-86.69150391319325263381485.

reduced by owners

8.0021.4660.7837

---

3.2.1 Ordinary shares

4624273153711819995461

increased by shareholders

8.0078.226.22

3.2.2 Capital increased by

holders of other equity

instruments

3.2.3 Share-based payments 3320515. 3320515.

included in owners’ equity 96 96

19325261

3.2.4 Other -86.69 40.80 1932526

4.89

60.78

3.3 Profit distribution 1062497 10624976

66.486.48

3.3.1 Appropriation to

surplus reserves

3.3.2 Appropriation to 1062497 10624976

66Lu Thai Textile Co. Ltd. Interim Report 2025

owners (or shareholders) 66.48 6.48

3.3.3 Other

3.4 Transfers within

owners’ equity

3.4.1 Increase in capital (or

share capital) from capital

reserves

3.4.2 Increase in capital (or

share capital) from surplus

reserves

3.4.3 Loss offset by surplus

reserves

3.4.4 Changes in defined

benefit pension schemes

transferred to retained

earnings

3.4.5 Other comprehensive

income transferred to

retained earnings

3.4.6 Other

3.5 Specific reserve

3.5.1 Increase in the period

3.5.2 Used in the period

3.6 Other

4. Ending balances of the 8173648 7138359 2457813 186060.0 1257552 5894332 8286198

-30349.56

period 96.00 1.09 27.54 0 275.70 490.12 170.89

67Lu Thai Textile Co. Ltd. Interim Report 2025

III Company Profile

Lu Thai Textile Co. Ltd. (hereinafter referred to as the “Company”) is a joint venture invested by Zibo Lucheng Textile

Investment Co. Ltd. (originally named Zibo Lucheng Textile Co. Ltd hereinafter referred to as Lucheng Textile) and Thailand

Tailun Textile Co. Ltd. In February 1993 it was restructured into a joint-stock company.In July 1997 with the approval of the Securities Committee of the State Council 80000000 foreign shares (B-shares) were listed

domestically. On August 19 1997 it was listed on the Shenzhen Stock Exchange with the B-share stock code being 200726. On

November 24 2000 the CSRC approved the issuance of an additional 50000000 ordinary shares (A-shares) which were listed

on the Shenzhen Stock Exchange on December 25 2000 with the A-share stock code being 000726.After several capital increases and repurchases as at June 30 2025 the Company’s registered capital was RMB817306400.Specifically there were 591180400 A-shares and 226126000 B-shares.The Company’s registered address: No. 61 Luthai Avenue Hi-tech Development Zone Zibo Shandong

The Company’s unified social credit code: 91370300613281175K.The Company’s legal representative: Liu Zibin.The scope of business of the Company and its subsidiaries shall include general projects: Fabric printing and dyeing processing;

garment manufacturing wholesale; procurement of primary agricultural products; power generation and transmission business.The Company’s financial statements and Notes thereof have been approved by the 3rd Meeting of the 11th Board of Directors held

on August 27 2025.IV Basis for Preparation of Financial Statements

1. Preparation Basis

This financial statement is prepared in accordance with the accounting standards for business enterprises and the applicationguide interpretation and other relevant regulations (hereinafter collectively referred to as “Accounting Standards for BusinessEnterprises”) issued by the Ministry of Finance. In addition the Company also disclosed relevant financial information in

accordance with the Regulations on Information Disclosure and Compilation for Companies Public Offering Securities No. 15 -

General Provisions on Financial Report (revised in 2023) issued by China Securities Regulatory Commission.The Company’s accounting is based on the accrual basis. Except for certain financial instruments this financial statement is

measured on the basis of historical cost. If the asset is impaired the corresponding impairment provision shall be made in

accordance with relevant regulations.

2. Going-concern

The financial statements are presented on the basis of continuing operations.V Significant Accounting Policies and Estimates

Specific accounting policies and accounting estimates indicators:

The Company determines income recognition policy according to its production and operation characteristics and the specific

accounting policies are shown in Note V (27).

68Lu Thai Textile Co. Ltd. Interim Report 2025

1. Statement of Compliance with the Accounting Standards for Business Enterprises

The financial statements prepared by the Company are in compliance with in compliance with the Accounting Standards for

Business Enterprises which factually and completely present the consolidated and the Company’s financial positions as at June

30 2025 business results and cash flows for H1 2025 and other relevant information.

2. Fiscal Year

The Company’s fiscal year starts on January 1 and ends on December 31 of every year according to the Gregorian calendar.

3. Operating Cycle

The Company regards 12 months as an operating cycle.

4. Recording Currency

The Company and its domestic subsidiaries adopt RMB as the recording currency. The Company’s overseas subsidiaries confirm

to adopt HKD and USD as the recording currency according their major economic environment of the operating. When preparing

the financial statements for the Reporting Period the Company adopted RMB as the recording currency.

5. Methods for Determining Materiality Standards and Selection Criteria

□ Applicable □ Not applicable

Item Materiality standards

Significant receivables withdrawal of bad

Individual receivables exceeding 0.3% of total assets

debt provision separately accrued

Significant receivables reversed or recovered

Individual receivables exceeding 0.3% of total assets

during the Reporting Period

Significant written-off of receivables during

Individual receivables exceeding 0.3% of total assets

the Reporting Period

Significant prepayments aging over one year Individual prepayment amounts exceeding 0.3% of total assets

Significant construction in progress Individual investment amounts exceeding 1% of total assets

Significant accounts payable aging over one

Individual accounts payable amounts exceeding 0.3% of total assets

year

A subsidiary whose total assets operating revenue or profit before tax (or

Significant non-wholly-owned subsidiary absolute loss amount) exceeds 10% of the corresponding item in the consolidated

financial statements is considered a significant non-wholly owned subsidiary

Significant investment activity projects Individual investment amounts exceeding 5% of total assets

6. Accounting Treatment for Business Combinations under the Common Control and Not under the

Common Control

(1) Business Combinations under the Same Control

For business combinations under the same control the assets and liabilities of the merged party acquired by the merger party in

the merger shall be measured at the carrying value of the merged party in the consolidated financial statement of the final

controller on the combination date. As for the difference between the carrying value of the merger consideration and carrying

value of the net assets obtained in the merger the Capital reserves shall be adjusted and if the capital reserve is insufficient to

69Lu Thai Textile Co. Ltd. Interim Report 2025

offset the retained earnings shall be adjusted.Realize business combination under the same control in steps by transaction several times

The assets and liabilities of the combined party acquired by the combining party in the combination shall be measured at the

carrying value of the combined party in the consolidated financial statement of the final controller on the combination date; the

difference between the sum of the carrying value of investment held before combination plus the carrying value newly paid on the

combination date and the carrying value of the net assets acquired in combination is used for adjusting the capital reserve (capital

stock premium) and if the capital reserves (share capital premium) is insufficient to offset the retained earnings shall be adjusted.The long-term equity investments held by the combining party before acquiring the control right of the combined party if relevant

gains and losses other comprehensive income and changes in other owners’ equity have been confirmed from the date of

acquiring equity and the date when the combining party and the combined party under the final control of the same party

whichever is later to the combination date shall offset the retained earnings at the beginning or current profits and losses in the

period of comparing statements.

(2) Business Combinations Not under the Same Control

For a business combination not under the same control the cost of the combination is the assets paid liabilities incurred or

assumed and the fair value of the equity securities issued on the acquisition date to obtain control over the purchased party. On the

purchase date the acquired assets liabilities and contingent liabilities of the purchased party are recognized at fair value.The difference between the merger cost and the fair value of the identifiable net assets of the acquired party acquired in the merger

(the former is greater than the latter) is recognized as goodwill and subsequent measurement is made based on the cost deducting

the accumulated impairment provision; the difference between the merger cost and the fair value of the identifiable net assets of

the acquired party acquired in the merger (the former is less than the latter) shall be recorded into the current profit or loss after the

recheck.Achieve business combination not under the same control step by step through multiple transactions

The cost of consolidation is the sum of the consideration paid at the purchase date and the fair value at the purchase date of the

equity already held by the acquired party before the purchase date. For equity of the acquired party that is already held before the

purchase date it shall be re-measured according to the fair value of the equity on the purchase date and the difference between the

fair value and its carrying value shall be included in the current investment income. If the equity of the acquired party held before

the purchase date involves other comprehensive income and the changes of other owner’s equity it shall be transferred to current

income on the purchase date other comprehensive income arising from the remeasurement of the net liability or net assets of a

defined benefit plan by the investee as well as other comprehensive income related to investments in non-trading equity

instruments designated at fair value through other comprehensive income are excluded.

(3) Treatment of Transaction Costs in Business Combinations

Intermediary expenses such as auditing legal services evaluation and consulting and other related administrative expenses

incurred for the business combination shall be included in the current profit and loss when incurred. The transaction costs of equity

securities or debt securities issued as the merger consideration shall be included in the initial recognition amount of equity

securities or debt securities.

7. Criteria for Judging Control and Methods for Preparing Consolidated Financial Statements

(1) Criteria for Judging Control

The consolidation scope of the consolidated financial statements is determined on the basis of control. Control means that the

Company has the power over the invested unit enjoys variable returns by participating in the related activities of the invested unit

and has the ability to use the power over the invested unit to influence the amount of its return. When changes in relevant facts and

circumstances lead to changes in the elements involved in the definition of control the Company will reassess.In determining whether to include a structured entity within the consolidation scope the Company considers all facts and

circumstances including assessing the purpose and design of the structured entity’s establishment identifying the types of variable

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returns and evaluating whether the Company controls the structured entity based on whether it has assumed some or all of the

variability in returns by participating in its relevant activities.

(2) Methods for Preparing Consolidated Financial Statements

The consolidated financial statements are prepared by the Company based on the financial statements of the Company and its

subsidiaries and other relevant materials. When preparing the consolidated financial statements the accounting policies and

accounting fiscal of the Company and those of subsidiaries shall be consistent and the large transactions and intercourse balance

among companies shall be offset.Subsidiaries and businesses increased due to business combinations under the same control during the Reporting Period shall be

included into the Company’s combination scope since the date when they are jointly controlled by the final controller and the

operating result and cash flow since then shall be respectively included into the consolidated income statement and consolidated

cash flow statement.As for subsidiaries and businesses increase due to business combinations not under the same control during the Reporting Period

the revenue expenses and profit or those subsidiaries and businesses from the purchase date to the end of the Reporting Period

shall be included into the consolidated income statement and the cash flow thereof shall be included into the consolidated cash

flow statement.The share of shareholders’ equity in subsidiaries not belonging to the Company shall be regarded as the equity of non-controlling

interests and separately listed under the item of shareholders’ equity in the consolidated balance sheet. The share of current portion

of net profit or loss in subsidiaries belonging to the equity of non-controlling interests shall presented as the item of the equity of

non-controlling interests under the item of net profit in the consolidated income statement. The difference between the losses of

subsidiaries born by not-controlling shareholders and the share of the company’s owners’ equity at the period-beginning the not-

controlling shareholders enjoy (the former is larger than the latter) shall be offset the equity of non-controlling interests.

8. Classification of Joint Arrangements and Accounting Treatment of Joint Operations

Joint arrangement refers to an arrangement under the joint control of two or more participants. The Company’s joint arrangements

are divided into joint operations and joint ventures.

(1) Joint Operations

A joint operation refers to a joint arrangement whereby the Company enjoys relevant assets of the arrangement and assumes

obligations relevant liabilities of the arrangement.The Company recognizes the following items related to the interest share in joint operation and conducts accounting treatment in

accordance with relevant provisions of the Accounting Standard for Business Enterprises:

A. It recognizes separately held assets and jointly held assets according to the proportion;

B. It recognizes separately assumed liabilities and jointly assumed liabilities according to the proportion;

C. Income from the sale of the proportion of joint operation output is recognized;

D. Income from the sale of the joint operation output is recognized according to the proportion;

E. While the separately incurred fee is recognized the incurred fee for joint operation is recognized according to the proportion.

(2) Joint Ventures

A joint venture refers to a joint arrangement whereby the Company enjoys the right of the net assets of the arrangement only.Accounting treatment of the investment of a joint venture is conducted by the Company in line with the provisions of relevant

equity method of accounting for long-term equity investment.

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9. Confirmation Standard for Cash and Cash Equivalent

The term “cash” refers to cash on hand and deposits that are available for payment at any time. Cash equivalents refer to

investments held by the Company that are short-term highly liquid easily convertible into known amounts of cash and have little

risk of change in value.

10. Foreign Currency Businesses and Translation of Foreign Currency Financial Statements

(1) Foreign Currency Business

The Company’s foreign currency business is translated into the amount of the recording currency at the approximate exchange rate

of the spot exchange rate on the transaction date.On the balance sheet date foreign currency monetary items are translated at the spot exchange rate on the balance sheet date. The

exchange difference arising from the difference between the spot exchange rate on the balance sheet date and the spot exchange

rate at the time of initial recognition or the previous balance sheet date is included in the current profit and loss; for foreign

currency non-monetary items measured at historical cost the translation adopts the spot exchange rate on the day the transaction

occurs; for foreign currency non-monetary items measured at fair value the translation adopts the spot exchange rate on the day

when the fair value is confirmed and the difference between the amount of recording currency and the amount of original

recording currency shall be included into the current profit or loss or other comprehensive income based on the nature of non-

monetary items.

(2) Conversion of Foreign Currency Financial Statements

When converting the foreign currency financial statements of overseas subsidiaries on the balance sheet date the assets and

liabilities items in the balance sheet shall be converted at the spot exchange rate on the balance sheet date. Other items of

shareholders’ equity except for “retained earnings” shall be converted at the spot exchange rate on the occurrence date.Income and expense items in the income statement shall be converted using the approximate spot exchange rate on the transaction

date.All items in the cash flow statement are converted according to the approximate spot exchange rate on the occurrence date of cashflow. The impact of exchange rate changes on cash is taken as a reconciling item and the item “impact of exchange rate changeson cash and cash equivalents” is separately listed in the cash flow statement to reflect.The difference arising from the conversion of financial statements is reflected in the “other comprehensive income” under the

shareholders’ equity in the balance sheet.When disposing of the overseas operation and losing control rights the foreign currency statement conversion difference related to

the overseas operation shown under the shareholders’ equity in the balance sheet shall be transferred to current profit and loss of

disposal in whole or in proportion to the disposal of overseas operation.

11. Financial Instruments

Financial instruments refer to contracts that form one party’s financial assets and form other parties’ financial liabilities or equity

instruments.

(1) Recognition and Derecognition of Financial Instruments

The Company recognizes a financial asset or financial liability when it becomes a party to the financial instrument contract.Where a financial asset satisfies any of the following requirements the recognition of it is terminated: a) The contractual rights for

collecting the cash flow of the said financial asset are terminated; b) The said financial asset has been transferred and meet the

following derecognition conditions for transfer of financial assets.Only when the prevailing obligations of a financial liability are relieved in all or in part may the recognition of the financial

liability be terminated in all or partly. Where the Company (debtor) enters into an agreement with a creditor so as to substitute the

72Lu Thai Textile Co. Ltd. Interim Report 2025

existing financial liabilities by way of any new financial liability and if the contractual stipulations regarding the new financial

liability is substantially different from that regarding the existing financial liability it terminates the recognition of the existing

financial liability and at the same time recognizes the new financial liability.The purchase and sale of financial assets under the normal ways shall be recognized and stopped to be recognized respectively at

the price of transaction date.

(2) Classification and Measurement of Financial Assets

The Company classifies financial assets into the following three categories according to the business mode of managing financial

assets and the contractual cash flow characteristics of financial assets upon initial recognition: financial assets measured at

amortized cost financial assets measured at fair value and whose changes are included in other comprehensive income and

financial assets at fair value through profit or loss.Financial assets are measured at fair value upon initial recognition. For financial assets at fair value through profit or loss relevant

transaction expenses are directly included in current profit and loss; for other types of financial assets relevant transaction

expenses are included in the initial recognition amount. For accounts receivable arising from the sale of products or the provision

of labor services which do not include or do not consider significant financing components the amount of consideration the

Company is expected to be entitled to receive is taken as the initial recognition amount.Financial assets measured at amortized cost

The Company classifies financial assets that meet the following conditions and are not designated to be measured at fair value

through profit or loss as financial assets measured at amortized cost:

The Company’s business model for managing this financial asset is aimed at collecting contractual cash flow;

The contractual terms of this financial asset stipulate that the cash flow generated on the specific date is only the payment of

principal and interest based on the principal amount outstanding.Such financial assets are measured in amortized cost by the effective interest method after initial recognition. Gains or losses

arising from financial assets measured in amortized cost that are not part of any hedging relationship are included in current profit

and loss when derecognition amortization according to the effective interest method or impairment is recognized.Financial assets measured at fair value and whose changes are included in other comprehensive income

The Company classifies financial assets that meet the following conditions and are not designated to be measured at fair value

through profit or loss as financial assets measured at fair value and whose changes are included in other comprehensive income:

The Company’s business model for managing this financial asset is aimed at both collecting the contractual cash flow and selling

this financial asset;

The contractual terms of this financial asset stipulate that the cash flow generated on the specific date is only the payment of

principal and interest based on the principal amount outstanding.Such financial assets are subsequently measured at fair value after initial recognition. Interest impairment losses or gains and

foreign exchange gains or losses calculated by the effective interest method are included in current profit and loss while other

gains or losses are included in other comprehensive income. When the financial asset is derecognized the accumulated gains or

losses previously included in other comprehensive income are transferred out and included in current profit and loss.Financial assets at fair value through profit or loss

Except for the financial assets measured at amortized cost and those measured at fair value with changes recognized in other

comprehensive income the Company classifies all other financial assets as financial assets measured at fair value with changes

recognized in profit or loss. Upon initial recognition in order to eliminate or significantly reduce accounting mismatches the

Company irrevocably designates some financial assets that should have been measured at amortized cost or at fair value and

whose changes are included in other comprehensive income as financial assets at fair value through profit or loss.Such financial assets are subsequently measured at fair value after initial recognition and the resulting gains or losses (including

interest and dividend income) are included in current profit and loss unless the financial assets are part of the hedging relationship.The business model of managing financial assets refers to how the Company manages financial assets to generate cash flow. The

73Lu Thai Textile Co. Ltd. Interim Report 2025

business model determines whether the cash flow of the financial assets managed by the Company comes from the collection of

contractual cash flow the sale of financial assets or both. The Company determines the business model for managing financial

assets on the basis of objective facts and specific business objectives decided by key management personnel to manage financial

assets.The Company evaluates the contractual cash flow characteristics of financial assets to determine whether the contractual cash flow

generated by the relevant financial assets on the specific date is only the payment of principal and interest based on the principal

amount outstanding. Among them the principal refers to the fair value of financial assets upon initial recognition; interest includes

consideration for the time value of money credit risks related to the principal amount outstanding in the specific period and other

basic lending risks costs and profits. In addition the Company evaluates the contract terms that may lead to changes in the time

distribution or amount of contractual cash flow of financial assets to determine whether they meet the requirements of the above-

mentioned contractual cash flow characteristics.Only when the Company changes the business mode of managing financial assets will all affected related financial assets be

reclassified on the first day of the first reporting period after business model changes otherwise financial assets cannot be

reclassified after initial recognition.

(3) Classification and Measurement of Financial Liabilities

The Company’s financial liabilities are classified upon initial recognition as: financial liabilities measured at fair value and whose

changes are included in current profit and loss and financial liabilities measured at amortized cost. For financial liabilities that are

not classified as measured at fair value and whose changes are included in current profit and loss relevant transaction costs are

included in the initial recognition amount.Financial liabilities measured at fair value with changes recognized in profit or loss

Financial liabilities measured at fair value with changes recognized in profit or loss include held-for-trading financial liabilities

and financial liabilities that are designated upon initial recognition as measured at fair value with changes recognized in profit or

loss. Subsequent measurement shall be carried out according to fair value for such financial liabilities. Gains or losses resulting

from changes in fair value and dividends and interest expenses related to such financial liabilities shall be included in current profit

and loss.Financial liabilities measured at amortized cost

Other financial liabilities are subsequently measured at amortized cost by using the effective interest method. Gains or losses

resulting from derecognition or amortization are included in current profit and loss.Distinction between financial liabilities and equity instruments

Financial liabilities refer to liabilities that meet one of the following conditions:

a) The contractual obligation to deliver cash or other financial assets to other parties.b) The contractual obligation to exchange financial assets or financial liabilities with other parties under potentially unfavorable

conditions.c) Non-derivative contracts that must be or can be settled with the enterprise’s own equity instruments in the future and the

enterprise will deliver a variable number of its own equity instruments according to the contract.d) Derivative contracts that must be or can be settled with the enterprise’s own equity instruments in the future except derivatives

contracts that exchange a fixed amount of cash or other financial assets with a fixed amount of its own equity instruments. Equity

instruments refer to contracts that can prove that an enterprise has the residual equity in its assets after deducting all liabilities.Equity instruments refer to contracts that can prove that an enterprise has the residual equity in its assets after deducting all

liabilities.If the Company cannot unconditionally avoid performing a contractual obligation by delivering cash or other financial assets the

contractual obligation meets the definition of financial liability.If a financial instrument must be or can be settled with the Company’s own equity instruments it is necessary to consider whether

the Company’s own equity instruments used to settle the instrument are used as substitutes for cash or other financial assets or to

74Lu Thai Textile Co. Ltd. Interim Report 2025

enable the holder of this instrument to enjoy the residual equity in the assets after deducting all liabilities from the issuer. If it is

the former this instrument is the Company’s financial liability; if the latter is the case this instrument is the Company’s equity

instrument.

(4) Derivative Financial Instruments and Embedded Derivatives

The Company’s derivative financial instruments include forward foreign exchange contracts foreign exchange option contracts

and others. Initially the fair value on the date when the derivative transaction contract is signed shall be used for measurement

and the fair value shall be used for subsequent measurement. Derivative financial instruments with positive fair value are

recognized as an asset while those with negative fair value are indeed recognized as a liability. Any gains or losses arising from

changes in fair value that do not conform to the provisions of hedge accounting are directly included in current profit and loss.For hybrid instruments containing embedded derivatives such as the main contract is a financial asset the relevant provisions on

classification of financial assets shall apply to the hybrid instruments as a whole. If the main contract is not a financial asset and

the hybrid instrument is not measured at fair value and its changes are included in current profit and loss for accounting treatment

the embedded derivative instrument has no close relationship with the main contract in terms of economic characteristics and risks

and has the same conditions as the embedded derivative instrument and the separate existing instrument meets the definition of

derivative instrument the embedded derivative instrument shall be separated from the hybrid instrument and treated as a separate

derivative financial instrument. If it is not possible to separately measure embedded derivative instruments at the time of

acquisition or the subsequent balance sheet date the hybrid instruments as a whole are designated as financial assets or financial

liabilities measured at fair value through profit or loss.

(5) Fair Value of Financial Instruments

The methods for determining the fair value of financial assets and financial liabilities are detailed in Note V-12.

(6) Impairment of Financial Assets

The Company conducts impairment accounting treatment for the following items and confirms the loss provision based on the

expected credit losses:

Financial assets measured at amortized cost;

Receivables and investment in debt instruments measured at fair value and whose changes are included in other comprehensive

income;

Contract assets defined in the Accounting Standards for Business Enterprises No. 14-Revenue;

Lease receivables;

Financial guarantee contracts (except those that are measured at fair value and whose changes are included in current profit and

loss the transfer of financial assets does not meet the conditions for derecognition or continue to involve in the transferred

financial assets).Measurement of expected credit losses

Expected credit loss refers to the weighted average of the credit losses of a financial instrument weighted by the risk of default

occurring. Credit loss refers to the difference between all contractual cash flows discounted at the original effective interest rate

and receivable according to the contract and all cash flows expected to be collected of the Company i.e. the present value of all

cash shortfalls.Considering the reasonable and reliable information about past events current situation and the forecast of future economic

situation the Company takes the risk of default as the weight calculates the probability weighted amount of the present value of

the difference between the cash flow receivable from the contract and the cash flow expected to be received and confirms the

expected credit loss.The Company separately measures the expected credit losses of financial instruments at different stages. If the credit risk of

financial instruments has not increased significantly since the initial recognition it is in the first stage. The Company measures the

loss reserve according to the expected credit loss in the next 12 months; if the credit risk of financial instruments has increased

significantly since its initial recognition but no credit impairment has occurred it is in the second stage. The Company measures

75Lu Thai Textile Co. Ltd. Interim Report 2025

the loss reserve according to the expected credit loss during the whole duration of this instrument; if the financial instrument has

suffered credit impairment since its initial recognition it is in the third stage. The Company measures the loss reserve according to

the expected credit loss during the whole duration of this instrument.For financial instruments with low credit risk on the balance sheet date the Company assumes that their credit risk has not

increased significantly since the initial recognition and measures the loss reserve according to the expected credit loss in the next

12 months.

The expected credit loss during the whole duration refers to the expected credit loss caused by all possible default events during

the whole expected duration of financial instruments. The expected credit loss in the next 12 months refers to the expected credit

loss caused by the possible default events of financial instruments within 12 months (or the expected duration if the expected

duration of financial instruments is less than 12 months) after the balance sheet date which is part of the expected credit loss in the

whole duration.When measuring the expected credit loss the longest term that the Company needs to consider is the longest contract term that the

enterprise faces credit risk (including the option to renew the contract).The Company calculates interest income based on the carrying amount before deducting impairment provisions and the effective

interest rate for financial instruments in the first and second stages and with low credit risk. The interest income shall be calculated

according to their carrying amount minus the amortized cost after impairment provision and the effective interest rate for financial

instruments in the third stage.For receivables such as notes receivable accounts receivable accounts receivables financing other receivables and contract assets

if the credit risk characteristics of a particular customer significantly differ from those of other customers in the portfolio or if

there is a significant change in the customer’s credit risk characteristics the Company will make receivables withdrawal of bad

debt provision separately accrued. Apart from receivables withdrawal of bad debt provision separately accrued are made the

Company classifies receivables into portfolios based on credit risk characteristics and calculates the allowance for doubtful debts

on a portfolio basis.Notes receivable accounts receivable and contract assets

The Company always measures its loss reserves at an amount equivalent to the expected credit loss during the entire duration for

notes receivable contract assets and accounts receivable regardless of whether there is any significant financing component.If a single financial asset or contract assets cannot be used to evaluate the expected credit loss information at a reasonable cost the

Company will divide the notes receivable accounts receivable and contract assets into portfolio on the basis of the credit risk

features and calculate the expected credit loss based on the portfolio. The basis for determining the portfolio is as follows:

A. Notes receivable

Notes receivable portfolio 1: Bank acceptance bills with low credit rating

Notes receivable portfolio 2: Commercial acceptance bills

B. Accounts receivable

Accounts receivable portfolio 1: Payment not overdue (with L/C)

Accounts receivable portfolio 2: Payment not overdue (with credit insurance)

Accounts receivable portfolio 3: Payment overdue (without credit insurance)

Accounts receivable portfolio 4: Payment overdue (with credit insurance)

Accounts receivable portfolio 5: Payment overdue (without credit insurance)

For notes receivable and contract assets divided into portfolios with reference to historical credit loss experience combined with

current conditions and predictions of future economic conditions the Company has calculated expected credit losses through

default risk exposure and expected credit loss rate for the entire duration.For accounts receivable divided into portfolios with reference to historical credit loss experience combined with current

conditions and predictions of future economic conditions the Company has prepared a comparison table between the number of

aging/overdue days of accounts receivable and the expected credit loss rate over the entire duration and has calculated the

76Lu Thai Textile Co. Ltd. Interim Report 2025

expected credit loss. The aging of accounts receivable is calculated from the date of recognition/the number of days overdue is

calculated from the expiry date of the credit period.Other receivables

The Company divides other receivables into several portfolios based on the features of credit risk and calculates the expected

credit losses on the basis of the combination. The basis for determining the portfolio is as follows:

Other receivables portfolio 1: Receivables from related parties within the scope of consolidation

Other receivables portfolio 2: Tax receivable

Other receivables portfolio 3: Security deposit and margin receivable

Other receivables portfolio 4: other receivables

For other receivables that are divided into portfolios the Company calculates the expected credit loss with the default risk

exposure and the expected credit loss rate within the next 12 months or the entire duration. For other receivables classified into

portfolios by aging the aging is calculated from the date of recognition.Creditors’ investment and other creditors’ investment

For creditors’ investment and other creditors’ investment the Company calculates the expected credit based on the nature of the

investment as well as kinds of types of counterparties and risk exposures the default risk exposure and the expected credit loss

rate within the next 12 months or the entire duration loss.Assessment on significant increase of credit risk

In order to determine the relative changes in the default risk of financial instruments during their expected life and to assess

whether the credit risk of financial instruments has increased significantly since initial recognition the Company compares the

default risk of financial instruments on the balance sheet date with the default risk on the initial recognition date.When determining whether the credit risk has risen greatly since the initial recognition the Company considers reasonable and

reliable information (forward-looking information inclusive) that can be obtained without unnecessary extra costs or efforts. The

information the Company considers shall include:

The debtor fails to pay the principal and interest according to the contract expiration date;

The external or internal credit ratings (if any) of financial instruments which have occurred or are expected deteriorate

significantly;

The debtor’s operating results which have occurred or are expected deteriorate significantly;

Existing or expected changes in technology market economy or legal environment will lead to a great adverse effect on the

debtor’s ability to repay the Company.Based on the nature of financial instruments the Company assesses whether there is great risk in credit risk on the basis of

individual financial instruments or financial instrument portfolios. During assessment based on financial instrument portfolios the

Company can divide financial instruments on the basis of common credit risk characteristics such as overdue information and

credit risk ratings.In case that the period overdue exceeds 30 days the Company determines that there is a significant increase in the credit risk of

financial instruments.Financial assets with depreciation of credit

The Company assesses on the balance sheet date whether there is any credit impairment to financial assets measured at amortized

cost and creditors’ investment measured at fair value and whose changes are included in other comprehensive income. In case of

one or more events that adversely affect the expected future cash flow of a financial asset occur the financial asset will become

financial assets with depreciation of credit. The observable information below can be treated as evidence for credit impairment to

financial assets:

The issuer or debtor is caught in a serious financial difficulty;

The debtor breaches the agreement of contract such as default or overdue payment of interest or principal or other default;

Due to economic or contractual considerations related to the debtor’s financial difficulties the Company gives concessions to the

77Lu Thai Textile Co. Ltd. Interim Report 2025

debtor; and the concessions will not be made under any other circumstances;

There lies a great probability of bankruptcy or other financial restructuring for the debtor;

The issuer or debtor is caught in financial difficulties which leads to the disappearance of the active market of the financial asset;

Presentation of expected credit loss provision

The Company remeasures expected credit losses on each balance sheet date to reflect the changes in the credit risk of financial

instruments since initial recognition; the increase or reversal amount of the loss reserve formed there from shall be included in the

current profit and loss as impairment losses or gains. For financial assets measured at amortized cost the loss allowance offsets the

carrying value of the financial asset listed in the balance sheet; for creditors’ investment that are measured at fair value and its

changes are included in other comprehensive income the Company recognizes its loss reserve in other comprehensive income and

will not offset the carrying value of the financial asset.Write-offs

In case that the Company fails to reasonably expect the contract cash flow of the financial asset to be recovered in a full or partial

scale the carrying amount of the financial asset will be written off directly. Such write-downs may constitute the derecognition for

related financial assets. This situation occurs frequently when the Company determines that the debtor does not have any assets or

any source of income to generate sufficient cash flow to repay the amount that will be written off. However in accordance with

the procedures for recovering due payments of the Company the written-off financial assets may still be affected by the execution

activities.In case that the financial asset written off is recovered later it shall be included in the current profit and loss as the reversal of the

impairment loss.

(7) Transfer of Financial Assets

The transfer of financial assets refers to the transfer or delivery of financial assets to another party (transferee) other than the issuer

of the financial asset.If the Company has transferred almost all the risks and rewards of the ownership of financial assets to the transferee derecognize

the financial asset; if it retains almost all the risks and rewards of the ownership of financial assets the financial asset will not be

derecognized.If the Company has neither transferred nor retained almost all the risks and rewards of the ownership of financial assets it shall be

dealt with in the following situations: if the control of the financial asset is abandoned the confirmation of the financial asset shall

be terminated and the generated assets and liabilities shall be confirmed; If the financial assets are controlled the relevant financial

assets shall be recognized according to the extent of their continued involvement in the transferred financial assets and the

relevant liabilities shall be recognized accordingly.

(8) Offsetting Financial Assets and Financial Liabilities

When the Company has a legal right that is currently enforceable to set off the recognized financial assets and financial liabilities

and intends either to settle on a net basis or to realize the financial asset and settle the financial liability simultaneously a financial

asset and a financial liability shall be offset and the net amount is presented in the balance sheet. Except for the above

circumstances financial assets and financial liabilities shall be presented separately in the balance sheet and shall not be offset.

12. Measurement of Fair Value

Fair value refers to the price that market participants can receive from sales of an asset or shall pay for transfer of a liability in the

orderly transaction that occurs on the measurement date.The Company measures related assets or liabilities at fair value assuming that the orderly transaction of selling assets or

transferring liabilities is conducted in the main market of related assets or liabilities; if there is no main market the Company

assumes that the transaction is conducted in the most beneficial market. The main market (or the most favorable market) is the

78Lu Thai Textile Co. Ltd. Interim Report 2025

trading market that the Company can enter on the measurement date. The Company uses the assumptions used by market

participants to maximize their economic benefits when pricing the asset or liability.For financial assets or financial liabilities with active markets the Company uses the quotation in active markets to determine its

fair value. If there is no active market for financial instruments the Company uses valuation techniques to determine its fair value.When measuring non-financial assets at fair value the ability of market participants to best use the asset for generating economic

benefits or the ability to sell the asset to other market participants that can best use the asset to generate economic benefits shall be

considered.The Company adopts valuation techniques that are applicable in the current situation and have sufficient available data and other

information to support it. Priority is given to using relevant observable input values. Only when observable input values ? ? are

unavailable or are not feasible to obtain the unobservable input values can be used.For assets and liabilities measured or disclosed at fair value in the financial statements the fair value hierarchy to which they

belong is determined based on the lowest level input value that is important to the fair value measurement as a whole: the first

level input value is the unadjusted quotation of the same assets or liabilities able to be obtained in an active market on the

measurement date; the second level input value is the directly or indirectly observable input value of the relevant asset or liability

except the first level input value; the third level input value is unobservable input value of related assets or liabilities.On each balance sheet date the Company reassessed the assets and liabilities continuously measured at fair value confirmed in the

financial statements to determine whether there is a transition among levels of fair value measurement.

13. Inventory

(1) Classification of Inventory

The Company inventories mainly include raw materials work-in-progress inventory goods products processed on entrustment

and etc.

(2) Valuation Method for Issued Inventories

The Company values inventories at actual cost upon acquisition. Grey yarn dyed yarn and fabric shall be measured at first-in

first-out method when acquired and delivered; other inventories shall be measured as per the weighted average method

(3) Basis for Determining the Net Realizable Value of Inventory and the Provision for Inventory Impairment

On the balance sheet date inventory is measured at the lower of cost and net realizable value. When their net realizable value falls

below cost an allowance for inventory impairment is provided.Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion the

estimated costs necessary to make the sale and relevant taxes. Net realizable value is determined on the basis of clear evidence

obtained and takes into consideration the purpose of holding inventories and effect of post balance sheet date events.The Company generally provides for inventory depreciation on a per-item basis. For inventories that are numerous in quantity and

low in unit price an allowance for inventory impairment is provided based on inventory categories.On the balance sheet date if the factors affecting the value of inventories previously written down have disappeared the provision

for inventory write-downs is reversed to the extent of the original amount provided.

(4) Inventory System

The Company’s perpetual inventory system is maintained for stock system.

(5) Amortization Method for Low-value Consumables and Packaging Materials

The Company applies the one-time write-off method for amortizing low-value consumables and packaging materials upon usage.

79Lu Thai Textile Co. Ltd. Interim Report 2025

14. Long-term Equity Investments

Long-term equity investments include equity investments in subsidiaries joint ventures and associated enterprises. The investee

that the Company is able to exert significant influence is an associated enterprise of the Company.

(1) Determination of Initial Investment Cost

Long-term equity investment that forms a business combination: Long-term equity investment obtained by business combination

under the same control on the merger date based on the carrying value share of the merged party’s owners’ equity in the final

controller’s consolidated financial statements as investment cost; The long-term equity investment acquired by a business

combination shall be the investment cost of the long-term equity investment according to the cost of the combination.For long-term equity investments obtained by other means: the long-term equity investment obtained by paying cash shall be the

initial investment cost according to the actual purchase price; the long-term equity investment obtained by issuing equity securities

shall be the initial investment cost of the fair value of the equity securities issued.

(2) Subsequent Measurement and Profit or Loss Recognition Method

Investments in subsidiaries are accounted for using the cost method unless the investment meets the conditions for classification

as held for sale. Investments in associated enterprises and joint ventures are accounted for using the equity method.For long-term equity investments that are accounted for using the cost method in addition to the cash dividends or profits that

have been declared but not yet included in the actual payment or consideration included in the investment the cash dividends or

profits declared by the invested entity are recognized as investment income and recorded into the current profit and loss.For long-term equity investments accounted for using the equity method where the initial investment cost is greater than the fair

value share of the investee’s identifiable net assets at the time of investment the investment cost of the long-term equity

investment is not adjusted; when the initial investment cost is less than the investment the investee ‘s If the fair value share of net

assets is identified the carrying value of the long-term equity investment is adjusted and the difference is included in the current

profit and loss of the investment.When using the equity method of accounting the investment income and other comprehensive income are recognized separately

according to the share of net profit and loss and other comprehensive income realized by the invested unit that should be enjoyed

or shared and the carrying value of the long-term equity investment is adjusted at the same time; The distribution of profits or

cash dividends should be calculated to reduce the carrying value of long-term equity investment; the investee’s other changes in

owner’s equity other than net profit and loss other comprehensive income and profit distribution adjust the carrying value of

long-term equity investment and Included in capital reserves (other capital reserves). When confirming the share of the investee’s

net profit or loss based on the fair value of the investee’s identifiable assets at the time of investment and in accordance with the

Company’s accounting policies and accounting period the net profit of the investee Confirm after making adjustments.If the additional investment and other reasons can exert significant influence on the investee or exercise joint control but do not

constitute control on the conversion date the sum of the fair value of the original equity plus the additional investment cost will

be used as the initial accounting for the equity method cost of investment. If the original equity is classified as non-trading equity

instrument investment measured at fair value whose changes are included in other comprehensive income the relevant original

and accumulative changes in fair value included in other comprehensive income shall be transferred to retained earnings when

accounting by equity method.If the joint control or significant influence on the invested unit is lost due to the disposal of part of the equity investment etc. the

remaining equity after the disposal shall be changed to the Accounting Standards for Business Enterprises No. 22-Recognition and

Measurement of Financial Instruments is performed and the difference between fair value and carrying value is included in the

current profit and loss. Other comprehensive income recognized by the original equity investment due to the equity method of

accounting shall be accounted for on the same basis as the investee’s direct disposal of related assets or liabilities when the equity

method of accounting is terminated; changes in other owners’ equity related to the original equity investment Transfer to current

profit and loss.If the control of the invested unit is lost due to the disposal of part of the equity investment if the remaining equity after the

80Lu Thai Textile Co. Ltd. Interim Report 2025

disposal can exercise joint control or exert significant influence on the invested unit the equity method is used for accounting and

the remaining equity is treated as when acquiring the equity method is adopted for adjustment; if the remaining equity after

disposal cannot exercise joint control or exert significant influence on the investee the accounting shall be changed according to

the relevant provisions of Accounting Standards for Business Enterprises No. 22—Recognition and Measurement of Financial

Instruments. The difference between the fair value and the carrying value on the date of loss of control is included in the current

profit and loss.If the shareholding ratio of the Company decreases due to the capital increase of other investors thereby losing control but being

able to exercise joint control or exert significant influence on the investee the new shareholding ratio shall be used to confirm that

the Company should enjoy the capital increase of the investee. The difference between the increase in share and the increase in the

share of net assets and the original carrying value of the long-term equity investment corresponding to the decrease in the

proportion of the shareholding that should be carried forward are included in the current profit and loss; That is adjustments are

made using the equity method of accounting.The unrealized internal transaction gains and losses that occur between the Company and associated enterprises and joint ventures

are calculated according to the shareholding ratio and are attributed to the Company and the investment gains and losses are

recognized on the basis of offset. However the unrealized internal transaction losses incurred by the Company and the investee are

the impairment losses of the transferred assets and shall not be offset.

(3) Basis for Determining Joint Control and Significant Influence over the Invested Entity

Joint control refers to shared control over an arrangement according to relevant agreements where the related activities of the

arrangement can only be decided with the unanimous consent of the participants sharing control. When judging whether there is

joint control first determine whether all participants or a combination of participants collectively control the arrangement and

secondly determine whether the decision-making related activities of the arrangement must be unanimously agreed by the

participants who collectively control the arrangement. If all participants or a Company of participants must act in concert to

determine the relevant activities of an arrangement it is considered that all participants or a Company of participants collectively

control the arrangement; if there is a combination of two or more participants can collectively Controlling an arrangement does not

constitute joint control. When judging whether there is joint control the protective rights enjoyed are not considered.Significant influence means that the investor has the right to participate in the decision-making of the financial and operating

policies of the invested unit but cannot control or jointly control the formulation of these policies with other parties. When

determining whether significant influence can be exerted on the investee consideration is given to the voting rights held directly or

indirectly by the investor in the investee as well as the impact of currently exercisable potential voting rights held by the investor

and other parties after assuming their conversion into equity in the investee including the effects of currently convertible warrants

share options and convertible corporate bonds issued by the investee.When the Company directly or indirectly owns more than 20% (including 20%) but less than 50% of the voting shares of the

invested unit it is generally considered to have a significant impact on the invested unit unless there is clear evidence that such

circumstances cannot participate in the production and operation decisions of the invested unit and does not have a significant

impact; when the Company owns less than 20% (excluding) voting rights of the invested unit it generally does not consider it to

have a significant impact on the invested unit unless there is clear evidence that under these circumstances it can participate in the

production and operation decisions of the invested unit and have a significant impact.

(4) Impairment Testing Method and Provision for Impairment

The method for recognizing impairment on investments in subsidiaries associated enterprises and joint ventures is detailed in

Note V-22.

15. Investment Property

Measurement model of investment property

Cost method measurement

81Lu Thai Textile Co. Ltd. Interim Report 2025

Depreciation or amortization method

The investment property refers to the real estate gaining the rent or capital appreciation or both. It includes rented land use rights

holding land use right to be transferred after the appreciation and rented building etc.The investment property is measured initially according to the cost and withdrawn depreciation or amortization as regulations of

fixed assets or intangible assets.The Company adopts the cost mode to conduct the subsequent measurement on the investment property see the Note V-22 for the

method of provision for impairment assets.The difference between the disposal income of investment property sales transfer scrap or damage after deducting its carrying

value and related taxes is included in the current profit and loss.

16. Fixed Assets

(1) Conditions for Recognition

The term “fixed assets” refers to the tangible assets that simultaneously possess the features as follows: (a) they are held for the

sake of producing commodities rendering labor service renting or business management; and (b) their useful life is in excess of

one fiscal year.The fixed assets are only recognized when the relevant economic benefits probably flow in the Company and its cost could be

reliable measured.The fixed assets of the Company are initially measured at the actual cost at the time of acquisition.The subsequent expenditures related to the fixed assets shall be included in the cost of the fixed assets when the economic benefits

related to the fixed assets are likely to flow into the Company and the costs can be measured reliably. The daily repair expenses of

fixed assets that do not meet the conditions of capitalized subsequent expenditures of fixed assets shall be included in the current

profit and loss or the cost of relevant assets according to the beneficiaries when incurred. The carrying value of the replaced part

shall be terminated.

(2) Depreciation Methods

Annual deprecation

Category Depreciation method Useful life Salvage value (%)

(%)

Average method of

Housing and building 5-30 0-10 20.00-3.00

useful life

Average method of

Machinery equipment 10-18 0-10 10.00-5.00

useful life

Average method of

Transportation vehicle 5 0-10 20.00-18.00

useful life

Electronic equipment Average method of

50-1020.00-18.00

and others useful life

(3) Recognition Basis Pricing and Depreciation Method of Fixed Asset under Finance Lease

See the Note V-22 for details.

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(4) At the End of Each Year Review Is Carried out by the Company for the Service Life Estimated Net

Residual Value and Depreciation Method of Fixed Assets

If there is any difference between the expected service life and the original estimated service life the service life of fixed assets

will be adjusted; if there is any difference between the expected net residual value and the original estimated net residual value the

expected net residual value will be adjusted

(5) Disposal of Fixed Assets

A fixed asset shall be derecognized when it is disposed of or it is expected that no economic benefit can be generated by using or

disposing of it. The amount of the disposal income of sales transfer scrap or damage of the fixed asset after deducting its carrying

value and related taxes is included in the current profit and loss.

17. Construction in Progress

Construction in progress is measured at actual cost. Actual cost comprises construction costs borrowing costs that are eligible for

capitalization before the fixed assets being ready for their intended us and other relevant costs.Construction in progress is transferred to fixed assets when the assets are ready for their intended use.See the details of the method of provision for impairment assets of the construction in progress to Notes V-22.

18. Engineering Materials

Engineering materials of the Company refer to various materials prepared for construction in progress including engineering

materials equipment not yet installed tools and instruments prepared for production etc.The purchased engineering materials will be measured according to the cost. The received engineering materials will be

transferred to the construction in progress and the remaining engineering materials after the completion of the project will be

stored as inventory.Please refer to Note V (22) for the method of provision for impairment assets for engineering materials.In the balance sheet the ending balance of engineering materials is listed in the “construction in progress” item.

19. Borrowing Costs

(1) Confirmation Principle of Capitalized Borrowing Costs

The borrowing costs incurred by the Company if can directly belong to acquisition construction or production of assets meeting

capitalization conditions are capitalized and included in relevant asset cost; other borrowing costs are confirmed as expense

according to its amount at the time of occurrence and included in the current profits and losses. Borrowing costs are capitalized

when they meet the following conditions:

a) Asset expenditures have been incurred. Asset expenditures include those incurred for the acquisition construction or

production of assets that meet the capitalization criteria through cash payments transfer of non-cash assets or the incurrence of

interest-bearing debts.b) Borrowing costs have been incurred;

c) The acquisition construction or production activities necessary to bring the asset to the condition for intended use or sale have

begun.

(2) Capitalization Period for Borrowing Costs

When the Company acquires constructs or produces assets which meet capitalization conditions and reach the intended usable or

83Lu Thai Textile Co. Ltd. Interim Report 2025

saleable status the borrowing costs stop capitalization. The borrowing costs that occur after the assets meeting capitalization

conditions reach the intended usable or saleable status are recognized as expenses according to its amount at the time of

occurrence and are included in the current profits and losses.If the assets meeting capital conditions generate improper interruption in the course of acquisition construction or production and

the interruption time continuously exceeds three months capitalization of borrowing costs suspends; the borrowing costs in the

normal interruption period are continually capitalized.

(3) Capitalization Rate of Borrowing Costs and Calculation Method of Capitalized Amount

The interest expenses of special borrowing actually occurring in the Current Period minus the interest income of the unused

borrowed capital obtained from depositing in bank or the gain on temporary investment are capitalized; for common borrowing

the weighted average of asset expenditure of the part that the cumulative asset expenditure exceeds special borrowing is multiplied

by the capitalization rate of the occupied common borrowing to determine capitalization amount. Capitalization rate is calculated

and determined according to the weighted average rate of common borrowing.In the period of capitalization the exchange difference of special borrowing in foreign currency is fully capitalized; the exchange

difference of special borrowing in foreign currency is included in the current profits and losses.

20. Intangible Assets

The Company’s intangible assets include land use rights software use rights patents and others.Intangible assets are initially measured at cost and their service life is analyzed and determined when intangible

assets are acquired. If the service life of intangible assets is limited the intangible assets shall be amortized by the

method that can reflect the expected realization method of the economic benefits related to the assets within the

expected service life since they are available for use. The method of line shall be used for amortization if no expected

realization method can be determined reliably. Intangible assets with uncertain service life shall not be amortized.The amortization method of intangible assets with limited service life is as follows:

Category Service life Amortization method Note

Land use rights Stipulated in the land certificate Method of line

Patent use right 10 years Method of line

Software use rights 1-3 years Method of line

Trademark right 10 years Method of line

At the end of each year the Company reviews the service life and amortization method of intangible assets with

limited service life. If the estimate is different from the previous one the original estimate shall be adjusted and

treated as per accounting estimate change.If it is estimated that an intangible assets can no longer bring future economic benefits to the enterprise on the date of

balance sheet this carrying value of the intangible asset shall be transferred into the current profit and loss.The method of provision for impairment assets on intangible assets was stated in the Note V-22.

84Lu Thai Textile Co. Ltd. Interim Report 2025

21. Research and Development Expenditures

The Company’s R&D expenditure relates directly to R&D activities including R&D personnel’s employee remuneration direct

input expenses depreciation charges and long-term deferred expenses design expenses equipment commissioning expenses

amortization expenses of intangible assets commissioned external research and development expenses and other expenses etc.The wages of R&D personnel are allocated to R&D expenditure based on project hours. R&D activities that share equipment

production lines or sites with other production and operational activities are allocated to R&D expenditure based on the

proportion of hours or area used.The expenditures for internal research and development projects of an enterprise shall be classified into research expenditures and

development expenditures.The research expenditures shall be recorded into the profit or loss for the Current Period.The development expenditures can be capitalized only when they satisfy the following conditions simultaneously: a) It is feasible

technically to finish intangible assets for use or sale; b) It is intended to finish and use or sell the intangible assets; c) The

usefulness of methods for intangible assets to generate economic benefits shall be proved including being able to prove that there

is a potential market for the products manufactured by applying the intangible assets or there is a potential market for the

intangible assets itself or the intangible assets will be used internally; d) It is able to finish the development of the intangible assets

and able to use or sell the intangible assets with the support of sufficient technologies financial resources and other resources; e)

The development expenditures of the intangible assets can be reliably measured. The development expenditures shall be recorded

into profit or loss for the Current Period when they don’t satisfy the following conditions.The research and development project of the Company will enter the development stage after meeting the above conditions and the

project is approved and initiated through technical feasibility and economic feasibility study.The capitalized expenditure in the development stage is listed as development expenditure on the balance sheet and it will be

transferred to intangible assets from the date when the project reaches the intended purpose.

22. Long-term Asset Impairment

For long term equity investment in subsidiaries associated enterprises and joint ventures investment property which follow-up

measurement is carried out by cost pattern fixed assets construction in progress right-of-use assets intangible assets goodwill

etc. (excluding inventory deferred income tax assets financial assets) the impairment of assets shall be determined according to

the following methods:

On the date of the balance sheet determination shall be made to see whether there is any sign of possible impairment of assets. If

there is the Company will estimate its recoverable amount and conduct impairment test. For goodwill intangible assets with

uncertain service life and intangible assets that have not reached the serviceable state due to business combination impairment test

shall be carried out every year regardless of whether there is any sign of impairment.The recoverable amount is determined according to the net amount of the fair value of the asset minus the disposal expenses and

the present value of the expected future cash flow of the asset the higher amount shall prevail. The Company estimates the

recoverable amount on the basis of a single asset. If it is difficult to estimate the recoverable amount of a single asset the

recoverable amount of the asset group shall be determined based on the asset group to which the asset belongs. The asset group is

determined on the basis of whether the main cash inflow generated by the asset group is independent of the cash inflow of other

assets or asset groups.When the recoverable amount of an asset or asset group is lower than its carrying value the Company will write down its carrying

value to the recoverable amount and the written down amount will be included in the current profit and loss and the

corresponding asset impairment reserve will be accrued.Regarding the impairment test of goodwill the carrying value of goodwill formed by business combination shall be apportioned to

85Lu Thai Textile Co. Ltd. Interim Report 2025

the relevant asset group in a reasonable way from the date of purchase. If it is difficult to apportion to the relevant asset group it

shall be apportioned to the relevant combination of asset group. The relevant asset group or combination of asset groups is the one

that can benefit from the synergy effect of business combination and is the one smaller than the reportable segment determined by

the Company.In the impairment test if there is any sign of impairment in the asset group or combination of asset groups related to goodwill first

impairment test shall be carried out on the asset group or combination of asset groups not containing goodwill to calculate the

recoverable amount and recognize the corresponding impairment loss. Then impairment test shall be carried out on the asset group

or combination of asset group containing goodwill to compare the carrying value with the recoverable amount. If the recoverable

amount is lower than the carrying value the impairment loss of goodwill shall be recognized.Once the asset impairment loss is recognized it will not be reversed in the future accounting period.

23. Long-term Deferred Expenses

The long-term deferred expenses incurred by the Company are valued at the actual cost and amortized averagely according to the

expected benefit period. For long-term deferred expenses the amortized value that cannot benefit the future accounting period

shall be included in the current profit and loss.

24. Payroll

(1) Payroll Scope

Payroll refers to the various forms of remuneration or compensation given by an enterprise for services provided by employees or

for the termination of employment relations. Payroll mainly includes short-term salary welfare after departure termination

benefits and other long-term staff welfare. Benefits provided to employees’ spouses children dependents survivors of deceased

employees and other beneficiaries also belong to the payroll.Based on liquidity payroll is presented in the balance sheet under the items “payroll payable” and “long-term payroll payable”.

(2) Accounting Treatment of Short-term Salary

During the accounting period in which employees provide services the Company recognizes the actual employee wages bonuses

social insurance premiums such as medical insurance premiums work-related injury insurance premiums and maternity insurance

premiums and housing provident funds paid to employees according to the prescribed standards and proportions as liabilities and

included them in the current profit and loss or related asset costs.

(3) Accounting Treatment of the Welfare after Departure

The post-employment benefit plan includes a defined contribution plan and a defined benefit plan. Among them the defined

contribution plan refers to the post-employment benefit plan that the enterprise no longer assumes further payment obligations

after the fixed fund has paid a fixed fee; the defined benefit plan refers to the post-employment benefit plan other than the defined

benefit plan.Defined contribution plan

The defined contribution plan includes basic pension insurance and unemployment insurance.During the accounting period in which employees provide services the amount of deposit payable calculated according to the

defined contribution plan is recognized as a liability and included in the current profit and loss or related asset costs.

86Lu Thai Textile Co. Ltd. Interim Report 2025

(4) Accounting Treatment of the Termination Benefits

The Company relieves the labor relation with the employees before the due date of the labor contacts or puts forward the advice of

providing the compensation for urging the employees volunteered to receive the downsizing and when the Company could not

unilaterally withdraw the demission welfare owning to the relieving plan of the labor relation or the downsizing advice should

confirm the liabilities of the employees’ salary from the demission welfare on the earlier day between the cost confirmed by the

Company and the cost related to the reorganization of the payment of the termination benefits and includes which in the current

gains and losses.

(5) Accounting Treatment of the Welfare of Other Long-term Staffs

Other long-term employee benefits provided by the Company to employees that meet the conditions of defined contribution plans

shall be handled in accordance with the above-mentioned relevant provisions on defined contribution plans. Those in line with the

defined benefit plan shall be handled in accordance with the above-mentioned relevant provisions on the defined benefit plan.However the part of “changes caused by remeasuring the net liabilities or net assets of the defined benefit plan” in the salary cost

of relevant employees shall be included in the current profit and loss or the relevant asset cost.

25. Provisions

If the obligation related to contingency meets the following conditions at the same time the Company will recognize it as a

provision.

(1) The obligation is the current obligation assumed by the Company;

(2) The performance of the obligation is likely to cause an outflow of economic benefits of the Company;

(3) The amount of the obligation can be measured reliably.

The provisions are initially measured in accordance with the optimal estimate of the necessary expenditures for the fulfillment of

the current obligation with factors such as risks uncertainty and the time value of money related to contingencies taken into

consideration comprehensively. Where the time value of money has a significant impact the best estimate is determined by

discounting the relevant future cash outflow. The Company re-checks the carrying value of the provisions on the balance sheet

date and adjusts the carrying value to reflect the current best estimate.If all or part of the expenditure required to settle recognized provisions is expected to be compensated by a third party or other

parties the amount of compensation shall be recognized separately as an asset only when it is substantially certain that it will be

received. The recognized amount of compensation shall not exceed the carrying value of the recognized liabilities.

26. Revenue

Accounting policies adopted for the recognition and measurement of revenue disclosed by type of business

(1) General Principle

The Company recognizes revenue when it has fulfilled its contract performance obligation in a contract namely when the

customer obtains the control over the related commodity or service.If a contract contains two or more performance obligations the Company allocates transaction price to single performance

obligations on the contract commencement date according to the relative ratio of separate price of goods or services committed by

single performance obligation and income is measured according to the transaction price allocated to single performance

obligation.

87Lu Thai Textile Co. Ltd. Interim Report 2025

When meeting one of the following conditions the Company belongs to performance of contract performing obligations in a

period or otherwise the Company belongs to performance of contract performing obligations at a point of time:

a) While the Company is performing the contract the customer acquires and consumes the economic benefit arising from

performance by the Company.b) The customer can control the goods in construction in the course of performance by the Company.c) The goods outputted in the course of performance by the Company have irreplaceable purpose and the Company has the right

to collection of money for the completed performance part cumulative up to now in the whole term of contract.For the performance obligation performed in a period the Company confirms income according to the performance progress in

such period. When the performance progress cannot be reasonably determined if the cost that the Company has incurred is

expected to be compensated income is confirmed according to the cost amount that has occurred until the performance progress

can be reasonably determined.For the performance obligation performed at a point of time income is confirmed at the point of time when the customer acquires

the control right to relevant goods or services. When it judges whether the customer has acquired the control right to the goods or

services the Company will consider the following indications:

a) The Company enjoys the current collection right to the goods or services i.e. the customer undertakes current payment

obligation to the goods.b) The Company has transferred the legal ownership of the goods to the customer that is the customer has owned the legal

ownership of the goods.c) The Company has transferred the kind of the goods to the customer namely the customer has possessed the good in kind.d) The Company has transferred the major risks and remuneration on the ownership of the goods i.e. the customer has acquired

the major risks and remuneration on the ownership of the goods.e) The customer has accepted the goods or services.f) Other indications showing that the customer has acquired the control right to the goods.The Company has transferred goods or services and has the right to collect consideration (and the right depends on factors other

than time elapse) as contract assets and contract asset is accrued impairment on the basis of expected credit loss (refer to Note V-

11. The right of the Company unconditionally (only depending on time elapse) charging consideration from the customer is listed

as receivable. The obligation of the Company that shall transfer goods or services to the customer for the consideration that has

been or shall be collected is contract liability.The contract assets and contract liabilities under the same contract are listed in net amount. If net amount is debit balance it is

listed in the items “contract asset” or “other non-current asset” according to its fluidity; if net amount is credit balance it is listed

in the items “contract liability” or “other non-current asset” according to its fluidity.

(2) Specific Methods

The specific income confirming methods of the Company are following:

For income of domestic products after the Company delivers products to the purchaser according to the provisions of the contract

and the purchaser confirms receipt the purchaser acquires the control right of products and the Company confirms income.For income of exportable products after the Company completes customs declaration of products departure and obtains bill of

lading according to the provisions of the contract the purchaser acquires the control right of products and the Company confirms

income.Differences in methods for the recognition and measurement of revenue caused by different business models for the same type of

business

Not applicable.

88Lu Thai Textile Co. Ltd. Interim Report 2025

27. Contract Costs

Contract cost includes the incremental cost incurred for acquiring contract and contract performance cost.The incremental cost incurred for acquiring contract refers to the cost that will not occur if the Company has not acquired contract

(for example sales commission). If the cost is expected to be recovered the Company regards it as contract acquiring cost and

confirms it as an asset. The expenses incurred by the Company for acquiring contract other than the incremental cost expected to

be recovered are included in the current profits and losses at the time of occurrence.If the cost incurred for performance of contract does not belong to inventory and other scope of other corporate accounting

standards and meets the following conditions the Company will regard it as contract performance cost and confirm it as an asset:

a) The cost is directly related to a copy of contract currently acquired or expected to be acquired including direct labor direct

materials manufacture expenses (or similar expenses) cost determined to be undertaken by the customer and other cost incurred

due to the contract;

b) The cost increases the resources of the Company that will be used for performance of contract obligations in the future;

c) The cost is expected to be recovered.The assets confirmed by the contract acquiring cost and the assets confirmed by the contract performance cost (“assets related tocontract cost”) are amortized according to the same basis as confirmation of goods or service income related to the asset and are

included in the current profits and losses. If the amortization term does not exceed one year it will be included in the current

profits and losses at the time of occurrence.When the carrying value of an asset related to contract cost is higher than the difference between the following two items the

Company accrues provision for impairment to the excessive part and confirms it as asset impairment loss:

a) The remaining consideration that the Company expects to acquire from transfer of goods or services related to the asset;

b) The cost that will occur for transfer of such related goods or services as estimated.

28. Government Grants

Government grants are recognized when they meet the conditions attached to government grants and when they can be received.Government grants for monetary assets shall be measured according to the amount received or receivable. Government grants for

non-monetary assets shall be measured by fair value.Asset related government grants refer to the government grants obtained by the Company for acquisition and construction or other

forms of long-term assets. In addition they are government grants related to income.Regarding the government grants that the government document does not specify the object of subsidy and can form long-term

assets the part of government subsidy corresponding to the asset value shall be regarded as the asset-related government subsidy

and the rest shall be regarded as income-related government subsidy. If it is difficult to distinguish the government subsidy shall

be regarded as the income-related government subsidy.The government grants related to assets shall be recognized as the deferred income which shall be included in the profit and loss

in installment in a reasonable and systematic way within the service life of the relevant assets. Income-related government grants

which are used to compensate the relevant costs or losses incurred shall be included in the current profit and loss. Those used to

compensate the relevant costs or losses in the later period shall be included in the deferred income and shall be included in the

current profit and loss during the recognition period of the relevant costs or losses. The government grants measured according to

the nominal amount shall be directly included in the current profit and loss. The same method is adopted for the same or similar

government grants businesses of the Company.Government grants related to daily activities shall be included in other incomes according to the essence of business transactions.Government grants irrelevant to daily activities are included in non-operating income.

89Lu Thai Textile Co. Ltd. Interim Report 2025

When the recognized government grants need to be returned and are used to offset the carrying value of related assets when

initially recognized the carrying amount of the assets shall be adjusted; the book balance of relevant deferred income shall be

offset if there is a balance of relevant deferred income and the excess part shall be included in the current profit and loss.Otherwise it shall be directly included in the current profit and loss.Regarding the interest subsidy of the policy preferential loan obtained if the Ministry of Finance allocates the interest subsidy to

the loan bank the actual received loan amount shall be taken as the entry value of the loan and the borrowing costs shall be

calculated according to the loan principal and the policy preferential interest rate. If the Ministry of Finance allocates the interest

subsidy directly to the Company the interest subsidy will offset the borrowing costs.

29. Deferred Income Tax Assets/Deferred Income Tax Liabilities

Income tax includes current income tax and deferred income tax. All shall be included in the current profit and loss as income tax

expense except the adjustment goodwill arising from business combination or the deferred income tax related to the transactions

or events directly included in the owner’s equity is included in the owner’s equity.Pursuant to the temporary difference between the carrying value of assets and liabilities on the date of balance sheet and the tax

basis the Company recognizes the deferred income tax by balance sheet liability method.For all taxable temporary differences related deferred income tax liabilities are recognized unless the taxable temporary

differences are generated in the following transactions:

(1) The initial recognition of goodwill or the initial recognition of assets or liabilities arising from transactions with the following

characteristics: The transaction is not a business combination and does not affect the accounting profit or income tax payable

when it occurs (Excluding transactions that initially recognized assets and liabilities resulting in equal taxable temporary

differences and deductible temporary differences.);

(2) Regarding the taxable temporary difference related to the investment of subsidiaries joint ventures and associated enterprises

the time of reversal of the temporary difference can be controlled and the temporary difference is unlikely to be reversed in the

foreseeable future.For deductible temporary differences deductible losses and tax credits that can be carried forward in subsequent years the

Company is likely to obtain the future income tax payable as the limit to offset the deductible temporary differences deductible

losses and tax credits in which way to recognize the deferred income tax assets arising from the deductible temporary differences

deductible losses and tax credits unless the deductible temporary differences are generated in the following transactions:

(1) The transaction is not a business combination and does not affect the accounting profit nor income tax payable when it occurs

(Excluding transactions that initially recognized assets and liabilities resulting in equal taxable temporary differences and

deductible temporary differences.);

(2) The corresponding deferred income tax assets shall be recognized if the deductible temporary differences related to the

investment of subsidiaries joint ventures and associated enterprises meet the following conditions simultaneously: The temporary

differences are likely to be reversed in the foreseeable future and the income tax payable used to deduct the deductible temporary

differences is likely to be obtained in the future.On the balance sheet date the deferred income tax assets and deferred income tax liabilities shall be measured by the Company on

the basis of the applicable tax rate during the period when the assets are expected to be recovered or the liabilities are expected to

be paid off and the income tax impact on the expected recovery of assets on the date of the balance sheet or on the method to pay

off the liabilities shall be reflected.

90Lu Thai Textile Co. Ltd. Interim Report 2025

The carrying value of deferred income tax assets shall be reviewed at each balance sheet date. If it is unlikely to obtain sufficient

income tax payable to offset against the benefit of the deferred income tax asset the carrying value of the deferred income tax

assets shall be written down. Any such write-down should be subsequently reversed where it becomes probable that sufficient

income tax payable will be available.As at the balance sheet date deferred income tax assets and deferred income tax liabilities are presented as a net amount when the

following conditions are simultaneously met:

(1) The tax entity within the Company has a legally enforceable right to set off current income tax assets against current income

tax liabilities;

(2) The deferred income tax assets and deferred income tax liabilities are related to income taxes levied by the same taxation

authority on the same taxable entity within the Company.

30. Lease

(1) Identification of Lease

On the start date of the contract the Company assessed as the lessee or the lessor whether the customers in the contract are entitled

to obtain almost all the economic benefits arising from the use of the identified assets during the use period and have the right to

dominate the use of the identified assets during the use period. If a party to the contract transferred the right allowing the control

over the use of one or more assets that have been identified within a certain period in exchange for a consideration such contract

is determined by the Company to be a lease or includes a lease.

(2) The Company as the Lessee

On the commencement date of the lease term the Company recognizes the right-of-use assets and lease liabilities for all leases

except for short-term leases and low-value asset leases with simplified treatment.For accounting policies for the right-of-use assets see Note V-32.Lease liabilities are initially measured in line with the lease payments not yet paid on the commencement date of the lease term

using the present value calculated by the interest rate implicit in lease. If the interest rate implicit in lease cannot be determined

the incremental borrowing rate shall be used as the discount rate. Lease payments include: Fixed payment and substantial fixed

payment and the relevant amount after deducting the lease incentive if any; variable lease payments depending on index or ratio;

exercise price of the purchased option provided that the lessee reasonably determines that the option will be exercised; the amount

to be paid for the exercise of the lease termination options provided that the lease term reflects that the lessee will exercise the

options to terminate the lease; and estimated payments due to the guaranteed residual value provided by the lessee. Subsequently

it calculates the interest expenses of the lease liabilities during each period of the lease term at a fixed periodic interest rate and

includes them in current profit and loss. Variable lease payments that are not covered in the measurement of the lease liabilities are

included in current profit or loss when actually incurred.Short-term lease

A short-term lease refers to a lease for a period not exceeding 12 months on the commencement date of the lease except for leases

with a purchase option.The Company includes the short-term lease payment in the cost of relevant assets or the current profit and loss in each period of

the lease term by the method of line.Low-value asset lease

A low-value asset lease refers to a lease where the value of a single leased asset is less than RMB40000 when the asset is new.The Company includes the lease payment of the low-value asset lease in the cost of relevant assets or the current profit and loss in

91Lu Thai Textile Co. Ltd. Interim Report 2025

each period of the lease term by the method of line.For low-value asset lease it chooses to adopt the aforesaid simplified treatment method in line with the specific status of each

lease.Lease change

If a lease changes and meets the following conditions simultaneously the lease change shall be regarded as a separate lease for

accounting treatment: a) The lease change expands its lease cope by increasing one or multiple use rights of lease assets; and b)

The increased consideration is equivalent to the amount of the separate price for the expanded part of the lease which is adjusted

according to the contract.Where the lease change is not regarded as a separate lease for accounting treatment on the effective date of the lease change by

the Company the consideration of the contract is amortized again upon change the lease term is redetermined and the lease

liabilities are remeasured according to the present value that is calculated by the lease payments and the revised discount rate upon

change.The Company shall correspondingly reduce the carrying value of the right-of-use assets and include the profit or loss of the lease

terminated in part or whole in the current profit or loss if the lease change narrows the scope of lease or shortens the lease term.The Company shall correspondingly adjust the carrying value of the right-of-use assets if other lease changes result in the re-

calculation of the lease liability.

(3) The Company as the Lessor

When the Company is a lessor it shall recognize leases that substantially transfer all risks and remuneration related to the

ownership of assets as finance leases and leases other than finance leases as operating leases.Finance lease

In a finance lease the Company recognizes the net lease investment as the book value of finance lease receivables on the

commencement date of the lease term. The net lease investment is the sum of the unguaranteed residual value and the present

value of lease receivables not yet received on the commencement date of the lease term at the interest rate implicit in lease. The

Company calculates and confirms the interest income at a fixed periodic interest rate in each period in the lease term. Variable

lease payments obtained that are not included in the net lease investment for measurement where the Company is the lessor are

included in the profit or loss of the Current Period when actually incurred.Accounting treatment shall be conducted for the derecognition and impairment of finance lease receivables in accordance with the

provisions of the Accounting Standards for Business Enterprises No.22—Recognition and Measurement of Financial Instruments

and the Accounting Standards for Business Enterprises No.23—Transfer of Financial Assets.Operating lease

The Company shall recognize the current profit and loss of the rent of the operating lease in each period of the lease term by the

method of line. The initial direct costs related to the operating lease shall be capitalized amortized within the lease term on the

same basis as the recognition of rental earning and included in profit or loss for the Current Period. The received variable lease

payments related to the operating lease that are not included in the lease payments receivable are included in profit or loss for the

Current Period when they are actually incurred.Lease change

Where an operating lease changes the accounting treatment is conducted for it which is regarded as a new lease from the effective

date of the change and receivables in advance or lease receivables related to lease before change are deemed as the receivables in

the new lease.Where a finance lease changes and meets the following conditions simultaneously the change is regarded as a separate lease by

the Company for accounting treatment: a) The change expands its lease cope by increasing one or multiple use rights of lease

assets; and b) The increased consideration is equivalent to the amount of the separate price for the expanded part of the lease

which is adjusted according to the contract.

92Lu Thai Textile Co. Ltd. Interim Report 2025

Where a finance lease changes and is not regarded as a separate lease for accounting treatment the Company treats the changed

lease under the following circumstances: a) If the change comes into force on the commencement date of the lease term the lease

will be clarified as an operating lease while it will be regarded as a new lease for accounting treatment by the Company on the

effective date of the lease change and the net lease investment before the effective date of lease change will be regarded as the

carrying value of lease assets; and b) If the change comes into force on the commencement date of the lease term the lease will be

clarified as a finance lease the Company will carry out accounting treatment in accordance with the provisions on modification or

renegotiation of a contract of the Accounting Standard for Business Enterprises No. 22—Recognition and Measurement of

Financial Instruments.

31. Right-of-Use Assets

(1) Recognition Conditions for Right-of-Use Assets

The term “right-of-use assets” refers to the right of the lessee to use the leased assets during the lease term.At the start date of the lease term the Company initially measures the right-of-use assets at cost. The cost includes: the initial

measurement amount of lease liabilities; the lease payments paid on or prior to the inception of the lease (less the related amount

of lease incentives already enjoyed if any); the initial direct cost incurred by the lessee; and the anticipated cost of dismantling and

removing the leasehold property restoring the site where the leasehold property is located or bringing the leasehold property back

to the state agreed upon in the lease terms. As the lessee the Company shall recognize and measure the cost of demolition and

restoration in accordance with the Accounting Standards for Business Enterprises No.13 - Contingencies. Subsequent adjustments

are made for any re-measurement of the lease liabilities.

(2) Depreciation Method of Right-of-Use Assets

The Company uses the method of line for depreciation. Where it can be reasonably certain that the Company the lessee can

obtain ownership of the leased assets at the expiry of the lease term the leased assets are depreciated over the residual service life.Where it cannot be reasonably certain that the Company can obtain ownership of the leased assets at the end of the lease term the

leased assets are depreciated at the shorter of the lease term and the residual service life of the leased assets.

(3) Impairment test method and impairment provision method of right-of-use assets See Note V-22.

32. Safety Production Costs and Costs for Sustaining Simple Reproduction

In accordance with the regulations of the Notice on Issuing the Management Measures for the Provision and Use of Enterprise

Production Safety Costs (C.Z. [2022] No. 136) issued by the Ministry of Finance and the Ministry of Emergency and based on the

above actual annual operating revenue of power generation and supply enterprises the Company adopts the method where the

deduction rate declines when the operating revenue increases to deduct safety production costs according to the following

standards:

Annual actual sales revenue standard Proportion of safety production cost (%)

Not exceeding RMB10 million 3

RMB10 million to RMB100 million 1.5

RMB100 million to RMB1 billion 1

RMB1 billion to RMB5 billion 0.8

Safety production costs and costs for sustaining simple reproduction are included in the cost of relevant production or current loss

and profit when deducted and are simultaneously included in the “specific reserve”.When using the deducted safety production costs and the costs for sustaining simple reproduction in conformity with regulations

the outgoing expenditures shall directly be used to offset the specific reserve; the costs becoming fixed assets shall be aggregated

under “construction in progress” and then be recognized as fixed assets when the safety project is completed and reaches the

93Lu Thai Textile Co. Ltd. Interim Report 2025

intended available status; The aforesaid fixed assets will not be depreciated as accrued in the future period. The aforesaid fixed

assets will not be depreciated as accrued in the future period.

33. Repurchase of Shares

Before the shares repurchased by the Company are cancelled or transferred they are managed as treasury shares and all

expenditures for the repurchase of shares are transferred to the cost of treasury shares. Consideration and transaction costs paid in

share repurchase reduce shareholders’ equity. When buying back transferring or cancelling shares in the Company no profits or

losses are recognized.The transfer of inventory shares shall be credited to the capital reserve on the basis of the difference between the amount actually

received and the carrying amount of the treasury stock. Write off surplus reserves and retained earnings if capital reserves are

insufficient to offset. Write-off of treasury stocks can reduce share capitals in par with par value and number of write-out stocks.The capital reserve is offset based on the difference between carrying amount and par value of cancelled treasury stocks. Write off

surplus reserves and retained earnings if capital reserves are insufficient to offset.

34. Material Accounting Judgments and Estimates

The Company evaluates the important accounting estimates and key assumptions adopted on an ongoing basis based on historical

experience and other factors including reasonable expectations of future events. Important accounting estimates and critical

assumptions that have a significant risk of causing a material adjustment to the carrying value of assets and liabilities within the

next fiscal year are listed as follows:

Classification of financial assets

The significant judgments involved when the Company determines the classification of financial assets include analysis of

business models and contractual cash flow characteristics.The Company determines the business model for managing financial assets at the level of the financial asset portfolio taking into

account factors such as the approach of evaluating and reporting the performance of financial assets to key management personnel

the risks affecting the performance of financial assets and the manner in which they are managed and way in which the relevant

business management personnel are compensated.When the Company evaluates whether the contractual cash flows of financial assets are consistent with the basic lending

arrangements it makes the following main judgments: whether the time distribution or amount of the principal may change during

the duration due to early repayment; whether the interest is only Includes time value of money credit risk other fundamental

lending risks and consideration against costs and profits. For example whether the amount of early repayment reflects only the

outstanding principal and interest based on the outstanding principal as well as reasonable compensation paid for early

termination of the contract.Measurement of expected credit losses of accounts receivable

The Company calculates the expected credit loss of accounts receivable using the exposure to default risk of accounts receivable

and the expected credit loss ratio and determines the expected credit loss ratio based on the probability of default and the default

loss ratio. When determining the expected credit loss ratio the Company uses data such as internal historical credit loss experience

and adjusts historical data to take into account current conditions and forward-looking information. When considering forward-

looking information the Company uses indicators such as the risk of economic downturn and changes in the external market

environment technological environment and customer profile. The Company regularly monitors and reviews the assumptions

related to the calculation of expected credit losses.Goodwill impairment

The Company assesses at least annually whether goodwill has been impaired. This requires estimating the use value of the asset

94Lu Thai Textile Co. Ltd. Interim Report 2025

group to which goodwill has been assigned. When estimating the use value the Company shall estimate the future cash flows from

the asset group and select the appropriate discount rate to calculate the present value of future cash flows at the same time.Deferred income tax assets

To the extent that it is probable that sufficient taxable profit will be available to offset the losses the Company recognizes deferred

income tax assets for all unused tax losses. This requires the Company’s management to use many judgments to estimate the

timing and amount of future taxable profits taking into account tax planning strategies so as to determine the amount of deferred

income tax assets to be recognized.Determination of fair value of unlisted equity investment

The fair value of unlisted equity investment is the expected future cash flows discounted at the current discount rate for items with

similar terms and risk characteristics. Such valuation requires the Company to estimate expected future cash flows and discount

rates and is therefore subject to uncertainty. Under limited circumstances if the information used to determine fair value is

insufficient or if the range of possible estimates of fair value is wide and the cost represents the best estimate of fair value within

that range the cost may represent its appropriate estimate of fair value within that range of distribution.

35. Changes in Significant Accounting Policies and Estimates

(1) Significant Changes in Accounting Policies

□ Applicable □ Not applicable

(2) Significant Changes in Accounting Estimates

□ Applicable □ Not applicable

(3) Adjustments to Financial Statement Items at the Beginning of the Year of the First Implementation of the New

Accounting Standards Implemented since 2025

□ Applicable □ Not applicable

VI Taxation

1. Main Taxes and Tax Rate

Category of taxes Tax basis Tax rate

Taxable value-added amount (the taxable amount is

calculated by multiplying the taxable sales by the

VAT 13% 9% 6% 5% 3% 0

applicable tax rate and deducting the input tax allowed to

be deducted in the Current Period)

Urban maintenance and

Turnover tax actually paid 7% 5%

construction tax

Enterprise income tax Income tax payable 0 11% 15% 16.5% 20% 25%

Notes of the disclosure situation of the taxpaying bodies with different enterprises income tax rate

Taxpayer Income tax rate

The Company 15%

LuFeng Company 15%

Lulian New Materials 15%

95Lu Thai Textile Co. Ltd. Interim Report 2025

Lu Thai Hong Kong 16.5?0%?

Luqun Textile 25%

Xinsheng Thermal Power 25%

Shanghai Luthai 20? %?

Lujia Import & Export 20%

Zhishu Consulting 2?0%?

Lu Thai Vocational Training School ?0?%

Banyang Villa 2?0%?

Huilin International 15%

Tianyi Apparel 0%

VACL 11%

2. Tax Preference

In accordance with the Notice for Announcing the First Batch of Hi-tech Enterprise Identification List of Shandong Province in

2023 (L.K.Z. [2024] No. 4) the Company was identified as a hi-tech enterprise and the certificate issuing date was November 29

2023; the majority-owned subsidiary LuFeng Company Limited was identified as a hi-tech enterprise and the certificate issuing

date was November 29 2023. In accordance with the Notice for Announcing Hi-tech Enterprise List of Shandong Province in

2022 the wholly-owned subsidiary Lulian New Materials was identified as a hi-tech enterprise and the certificate issuing date was

December 12 2022. Therefore in accordance with Article 28 of the Enterprise Income Tax Law of the People’s Republic of China

and the Announcement of the State Administration of Taxation on Issues Concerning the Implementation of Preferential Income

Tax Policies for High-tech Enterprises (Announcement No. 24 [2017] of the State Administration of Taxation) the applicable

enterprise income tax rate shall be 15%.The wholly-owned subsidiaries including Shanghai Luthai Zhishu Consulting Banyang Villa and Lujia IMP. & EXP. have been

recognized as small low-profit enterprises. According to the Announcement of the Ministry of Finance and the State Taxation

Administration on Further Implementing the Preferential Income Tax Policies for Micro and Small Enterprises (Announcement

No. 13 [2022] of the Ministry of Finance and the State Taxation Administration) the income tax payable of small low-profit

enterprises shall be calculated at a reduced rate of 25% and enterprise income tax shall be levied at a tax rate of 20%.The wholly-owned subsidiary Lu Thai Vocational Training School has been recognized as a non-profit making organization

exempt from tax between 2021 and 2025. According to Article 26 Item 4 of the Enterprise Income Tax Law of the People’s

Republic of China the policy whereby eligible non-profit making organizations are exempt from enterprise income tax shall apply

to the foregoing subsidiary.Lu Thai (HK) Textile Co. Ltd. (hereinafter refers as Lu Thai (HK) Textile) the wholly-owned subsidiary of the Company was

incorporated in Hong Kong SAR whose profit tax shall be paid at tax rate of 16.5%.The wholly own subsidiary VACL according to the Burma’s Special Economic Zone Law issued by Pyidaungsu Hluttaw VACL

enjoys tax preference on enterprise income tax of 7 (7 years tax holiday) + 5 (5 years tax revenues drop by half) + 5 (re-invest the

profits within 1 year and continues to enjoy the half tax revenues 5 years afterwards). After grace period enterprise income tax

rate was of 22%. Year 2025 is the third year of tax halving period with the enterprise income tax rate at 11%.

96Lu Thai Textile Co. Ltd. Interim Report 2025

The wholly-owned subsidiary Tianyi Apparel enjoys a three-year corporate income tax exemption starting from the operating

year in accordance with the Myanmar Investment Law issued by the Myanmar Parliament. After grace period enterprise income

tax rate was of 22%.The wholly-owned subsidiary Huilin International which was registered in the Hainan Free Trade Port and operates in the

encouraged industry shall pay enterprise income tax at a reduced tax rate of 15% between January 1 2020 and December 31

2027 according to the Announcement of the Ministry of Finance and the State Taxation Administration on the Preferential Income

Tax Policies for Enterprises Registered in the Hainan Free Trade Port (Announcement No. 31 [2020] of the Ministry of Finance

and the State Taxation Administration) and the Notice of the Ministry of Finance and the State Taxation Administration on

Continuing to Implement the Preferential Income Tax Policies for Enterprises Registered in the Hainan Free Trade Port (C.S.[2025] Document No. 3).VII Notes to Main Items of Consolidated Financial Statements

1. Monetary Capitals

Unit: RMB

Item Ending balance Beginning balance

Cash on hand 7356389.93 4283695.11

Bank deposits 2131393967.95 2051573093.26

Other monetary capital 363757.52

Total 2139114115.40 2055856788.37

Of which: Total amount deposited

336686299.79293656210.45

overseas

Other notes:

As at June 30 2025 the restricted monetary capital amounted to RMB0.The interest receivable in bank deposits was RMB22235716.93.

2. Held-for-trading Financial Assets

Unit: RMB

Item Ending balance Beginning balance

Financial assets at fair value through profit or loss 1049351158.38 693972672.64

Of which:

Investment in debt instruments 620681575.78 230874092.14

Equity instrument investment 428669582.60 462622130.31

Derivative financial assets 476450.19

Total 1049351158.38 693972672.64

3. Notes Receivable

(1) Notes Receivable Listed by Category

Unit: RMB

Item Ending balance Beginning balance

97Lu Thai Textile Co. Ltd. Interim Report 2025

Bank acceptance bills 38127660.44 50959990.35

Trade acceptance notes 902500.00 380000.00

Total 39030160.44 51339990.35

(2) Disclosure by Withdrawal Methods for Bad Debts

Unit: RMB

Ending balance Beginning balance

Carrying amount Bad debt provision Carrying amount Bad debt provision

Category Withdra Carrying Withdra Carrying

Amoun Percent wal value Percenta walAmount Amount Amount value

t age (%) proporti ge (%) proporti

on on

Of which:

Notes

receivable

of bad debt 39077 100.00 47500. 390301 513599 20000.0 513399

0.12%100.00%0.04%

provision 660.44 % 00 60.44 90.35 0 90.35

withdrawn

by groups

Of which:

Commercia

l 95000 47500. 902500. 400000. 20000.0 380000.

2.43%5.00%0.78%5.00%

acceptance 0.00 00 00 00 0 00

bills

Bank

acceptance

38127381276509599509599

bills with 97.57% 99.22%

660.4460.4490.3590.35

low credit

ratings

39077100.0047500.39030151359920000.0513399

Total 100.00%

660.44%0060.4490.35090.35

If adopting the general mode of expected credit loss to withdraw bad debt provision of notes receivable:

□ Applicable □ Not applicable

(3) Bad Debt Provision Withdrawn Reversed or Recovered in the Current Period

Withdrawal of bad debt provision:

Unit: RMB

Changes in the Current Period

Beginning

Category Reversed or Ending balancebalance Withdrawal Write-offs Others

recovered

Commercial

20000.0027500.0047500.00

acceptance bills

Total 20000.00 27500.00 47500.00

Of which significant amount of recovered or transferred-back bad debt provision for the Current Period:

□ Applicable □ Not applicable

98Lu Thai Textile Co. Ltd. Interim Report 2025

(4) Notes Receivable Which Had Endorsed by the Company or Had Discounted and Had Not Due on the

Balance Sheet Date at the Period-End

Unit: RMB

Amount of recognition termination at the Amount of not terminated recognition at

Item

period-end the period-end

Bank acceptance bills 19797413.77

Total 19797413.77

4. Accounts Receivable

(1) Disclosure by Aging

Unit: RMB

Aging Ending carrying amount Beginning carrying amount

Within one year (including one year) 762865482.86 904143884.57

One to two years 47999626.32 2598409.10

Two to three years 1368472.86 767071.40

More than three years 346166.33 435318.77

Three to four years 296191.00 206818.00

Four to five years 0.00 195961.82

Over five years 49975.33 32538.95

Total 812579748.37 907944683.84

(2) Disclosure by Withdrawal Methods for Bad Debts

Unit: RMB

Ending balance Beginning balance

Carrying amount Bad debt provision Carrying amount Bad debt provision

Category Withdra WithdraPercen Carrying Carrying

wal Percenta wal

Amount tage Amount value Amount Amount value

proporti ge (%) proporti

(%)

on on

Accounts

receivable

withdrawal

of Bad 144408 144408 138052 138052

0.18%100.00%0.15%100.00%

debt 2.86 2.86 5.86 5.86

provision

separately

accrued

which:

Accounts

receivable 811135 99.82 638960 747239 906564 573956 849168

withdrawal 7.88% 99.85% 6.33%665.51 % 59.74 605.77 157.98 18.71 539.27

of bad debt

provision

99Lu Thai Textile Co. Ltd. Interim Report 2025

of by

group

which:

Undue

14608817.98146088164066164066

accounts 0.00% 18.07%

285.97%285.97967.38967.38

(L/C)

Undue

accounts

12316415.16129322121871108041113443106906

(credit 1.05% 11.90% 1.05%

487.50%7.16260.34036.630.94605.69

insurance

insured)

Undue

accounts 366379 45.09 183189 348060 489845 244922 465352

5.00%53.95%5.00%

(no credit 482.27 % 74.24 508.03 177.53 58.89 918.64

insurance)

Overdue

accounts

403652633734340279421355661528355202

(credit 4.97% 15.70% 4.64% 15.70%

52.874.7108.1684.316.7397.58

insurance

insured)

Overdue

accounts 135138 16.63 379465 971916 102475 251536 773217

28.08%11.29%24.55%

(no credit 156.90 % 13.63 43.27 392.13 42.15 49.98

insurance)

812579100.00653401747239907944587761849168

Total 8.04% 100.00% 6.47%

748.37%42.60605.77683.8444.57539.27

The category name of bad debt provision separately accrued: June 2025

Unit: RMB

Beginning balance Ending balance

Name Carrying Bad debt Carrying Bad debt Withdrawal Reason for

amount provision amount provision proportion withdraw

Customer in

Customer 1 1380525.86 1380525.86 1444082.86 1444082.86 100.00% financial

difficulty

Total 1380525.86 1380525.86 1444082.86 1444082.86

If adopting the general mode of expected credit loss to withdraw bad debt provision of accounts receivable:

□ Applicable □ Not applicable

(3) Bad Debt Provision Withdrawn Reversed or Recovered in the Current Period

Withdrawal of bad debt provision:

Unit: RMB

Changes in the Current Period

Beginning

Category Ending balance

balance Reversed orWithdrawal Write-offs Others

recovered

Bad debt provision 58776144.57 6459634.43 -107738.00 3374.40 65340142.60

Total 58776144.57 6459634.43 -107738.00 3374.40 65340142.60

100Lu Thai Textile Co. Ltd. Interim Report 2025

(4) Accounts Receivable Written-off in Current Period

Unit: RMB

Item Written-off amount

Written-off accounts receivable 3374.40

Notes to verification of accounts receivable:

There were no write-offs of significant accounts receivable.

(5) Top 5 of the Ending Balance of the Accounts Receivable and the Contract Assets Collected According

to Arrears Party

Unit: RMB

Ending balance of

Proportion to total bad debt provision

Ending Ending balance of

Ending balance of ending balance of of accounts

balance of accounts

Name of the entity accounts accounts receivable and

contract receivable and

receivable receivable and impairment

assets contract assets

contract assets provision for

contract assets

Zichuan District Heating

61079346.6561079346.657.52%19309353.27

Guarantee Service Center

Customer A 50298449.85 50298449.85 6.19% 2035.79

Customer B 34567040.67 34567040.67 4.25% 2819874.07

Customer C 28376503.53 28376503.53 3.49% 1521247.14

Customer D 27336391.07 27336391.07 3.36% 1393884.30

Total 201657731.77 201657731.77 24.81% 25046394.57

5. Receivables Financing

(1) Receivables Financing Listed by Category

Unit: RMB

Item Ending balance Beginning balance

Notes receivable 37620151.81 10234905.61

Less: Other comprehensive income-fair

-120350.61-50005.02

value change

Total 37499801.20 10184900.59

(2) Notes Receivable Which Had Endorsed by the Company or Had Discounted and Had Not Due on the

Balance Sheet Date at the Period-End

Unit: RMB

Amount of recognition termination at the Amount of not terminated recognition at

Item

period-end the period-end

Bank acceptance bills 108816177.25

Total 108816177.25

101Lu Thai Textile Co. Ltd. Interim Report 2025

6. Other Receivables

Unit: RMB

Item Ending balance Beginning balance

Other receivables 24152797.11 23107489.38

Total 24152797.11 23107489.38

(1) Other Receivables

1) Other receivables classified by nature

Unit: RMB

Nature Ending carrying amount Beginning carrying amount

Export rebates 1204498.40 4399746.28

VAT to be returned 7825440.63 7514820.14

Payment on behalf 10863870.65 8666645.96

Guarantee deposit and cash deposit 2203023.23 2181386.82

Borrowings and petty cash 1859136.44 1255511.54

Others 6498909.30 5311251.41

Total 30454878.65 29329362.15

2) Disclosure by aging

Unit: RMB

Aging Ending carrying amount Beginning carrying amount

Within one year (including one year) 18638028.05 18125208.20

One to two years 1956342.58 1153509.15

Two to three years 6254105.57 6434852.90

More than three years 3606402.45 3615791.90

Three to four years 54000.00 166000.00

Four to five years 112000.00 846.87

Over five years 3440402.45 3448945.03

Total 30454878.65 29329362.15

3) Disclosure by withdrawal methods for bad debts

□ Applicable □ Not applicable

Unit: RMB

Ending balance Beginning balance

Carrying amount Bad debt provision Carrying amount Bad debt provision

Categor Withdra Carrying Withdray CarryingPercenta wal value Percenta walAmount Amount Amount Amount value

ge (%) proporti ge (%) proporti

on on

Of which:

Withdra 304548 630208 241527 293293 622187 231074100.00% 20.69% 100.00% 21.21%

wal of 78.65 1.54 97.11 62.15 2.77 89.38

102Lu Thai Textile Co. Ltd. Interim Report 2025

bad debt

provisio

n by

group

Of which:

Bad debt

provisio 197409 987046. 187538 186700 933500. 177365

64.82%5.00%63.66%5.00%

n in 28.41 41 82.00 16.05 80 15.25

Stage 1

Bad debt

provisio 105509 515202 539891 104963 512535 537097

34.64%48.83%35.79%48.83%

n in 38.19 3.08 5.11 34.05 9.92 4.13

Stage 2

Bad debt

provisio 163012. 163012. 163012. 163012.

0.54%100.00%0.56%100.00%

n in 05 05 05 05

Stage 3

304548630208241527293293622187231074

Total 100.00% 20.69% 100.00% 21.21%

78.651.5497.1162.152.7789.38

Withdrawal of bad debt provision by adopting the general mode of expected credit loss:

Unit: RMB

First stage Second stage Third stage

Bad debt provision Expected credit loss in Expected credit loss inExpected credit loss of Total

the duration (credit the duration (credit

the next 12 months

impairment not occurred) impairment occurred)

Balance of January 1

933500.805125359.92163012.056221872.77

2025

Balance of January 1

2025 in the Current

Period

Withdrawal of the

53545.6126663.1680208.77

Current Period

Balance of June 30

987046.415152023.08163012.056302081.54

2025

Basis of classification of stages and percentage of provision for bad debts

Changes of carrying amount with significant amount changed of loss provision in the Current Period

□ Applicable □ Not applicable

4) Bad debt provision withdrawn reversed or recovered in the Current Period

Withdrawal of bad debt provision:

Unit: RMB

Changes in the Current Period

Beginning

Category Charged-Reversed or Ending balancebalance Withdrawal off/Verificat Others

recovered

ion

Expected credit loss of the next

933500.8053545.61987046.41

12 months at the first stage

Expected credit loss in the

duration (credit impairment not 5125359.92 26663.16 5152023.08

occurred) at the second stage

103Lu Thai Textile Co. Ltd. Interim Report 2025

Expected credit loss in the

duration (credit impairment 163012.05 0.00 163012.05

occurred) at the third stage

Total 6221872.77 80208.77 0.00 0.00 0.00 6302081.54

5) Top 5 of the ending balance of the other receivables collected according to the arrears party

Unit: RMB

Proportion to total Ending balance

Name of the entity Nature Ending balance Aging ending balance of of bad debt

other receivables % provision

Within one year; one

General department of Rebate of to two years; two to

7825440.6325.70%3327232.52

taxation VAT three years; Over

three years

Withholding and

Payment on

remitting of personal 5065073.81 Within one year 16.63% 253253.69

behalf

endowment insurance

Withholding and

Payment on

remitting of personal 1269957.42 Within one year 4.17% 63497.87

behalf

medical insurance

Zichuan District Tax Export

1204498.40 Within one year 3.96% 60224.92

Bureau rebates

Withholding and

remitting of personal Payment on

1147576.25 Within one year 3.77% 57378.81

housing provident behalf

fund

Total 16512546.51 54.23% 3761587.81

7. Prepayments

(1) Prepayments Listed by Aging Analysis

Unit: RMB

Ending balance Beginning balance

Aging

Amount Percentage (%) Amount Percentage (%)

Within one year 132356488.10 99.86% 94018468.42 99.66%

One to two years 81487.69 0.06% 321877.26 0.34%

Two to three years 101808.00 0.08%

Total 132539783.79 94340345.68

Notes of the reasons of the prepayments aging over one year with significant amount but failed settled in time:

There were no significant prepayments aged over one year during the Reporting Period.

104Lu Thai Textile Co. Ltd. Interim Report 2025

(2) Top 5 Prepayment in Ending Balance Collected According to the Prepayment Target

The prepayments to suppliers from the top five of prepaid parties classified based on the ending balance totals

RMB84781081.87 in the Current Period accounting for 63.97% of the total ending balance of the prepayments to suppliers.

8. Inventory

Whether the Company needs to comply with the disclosure requirements for the real estate industry

Not

(1) Category of Inventory

Unit: RMB

Ending balance Beginning balance

Falling price Falling price

reserves or reserves or

Item provision for provision forCarrying Carrying

impairment on Carrying value impairment on Carrying value

amount amount

contract contract

performance performance

cost cost

Raw materials 861633868.63 59031398.97 802602469.66 806501875.49 55650999.99 750850875.50

Goods in

437205502.409493261.67427712240.73520394109.826229881.12514164228.70

process

Inventory

952360327.28183571540.67768788786.61952987895.46208856231.77744131663.69

goods

Commissioned

13584476.9213584476.9210737638.4110737638.41

products

Materials in

21512339.5421512339.54

transit

2286296514.2034200313.2290621519.2019884406.

Total 252096201.31 270737112.88

77461830

(2) Falling Price Reserves of Inventory and Impairment Reserves for Contract Performance Costs

Unit: RMB

Increased amount of the Current Decreased amount for the Current

Beginning Period Period

Item Ending balance

balance Recovered or

Withdrawal Others Others

charged-off

Raw materials 55650999.99 3402176.21 21777.23 59031398.97

Work-in-

6229881.123274030.5610650.019493261.67

progress

Inventory

208856231.7722415168.5147348067.92351791.69183571540.67

goods

Total 270737112.88 29091375.28 0.00 47348067.92 384218.93 252096201.31

9. Current Portion of Non-current Assets

Unit: RMB

105Lu Thai Textile Co. Ltd. Interim Report 2025

Item Ending balance Beginning balance

Debt investment due within one year 150000000.00 150000000.00

Interest payable of bond investment 6297393.15 4176585.64

Total 156297393.15 154176585.64

(1) Investments in Debt Obligations Due within One Year

□ Applicable □ Not applicable

1) Significant debt investments maturing within one year at the end of the period

Unit: RMB

Actual interest rate Overdue principal

Coupon

Item Par value Due date

rate Ending Beginning Ending Beginning

balance balance balance balance

Return

150000000.00 3.00% December 22 2025

voucher

Total 150000000.00

(2) Other Investments in Debt Obligations Due within One Year

□ Applicable □ Not applicable

10. Other Current Assets

Unit: RMB

Item Ending balance Beginning balance

Other tax 6705193.86 8592405.88

Prepaid income tax 2407586.80 37101.68

Prepaid other taxes 163707.23 205457.78

Convertible broken lot fund 199660.30 199662.42

Deposit for recognizance 3852177.98 49999919.97

Receivables from liquidation 7000000.00

Total 20328326.17 59034547.73

11. Long-term Equity Investments

Unit: RMB

Beginn Increase/decrease for the Current Period

Beginn Ending

ing

ing Gains Adjust Cash Withdr

Ending

balanc

balanc balanc

balanc and ment bonus awal

Investe e of Additi Reduc Chang

e of

e onal ed losses of

or of e provisi

e provisi es of (carryi

(carryi recogn other profits impair Othersinvest invest other on foron for ng

ng ized compr annou ment impair

impair ment ment equity value)

value) under ehensi nced to provisi ment

ment the ve issue on

106Lu Thai Textile Co. Ltd. Interim Report 2025

equity incom

metho e

I. Joint ventures

II. Associated enterprises

Ningb

Meish

Bonde

d Port

Area

Haoho

Equity

Invest 31325 13866 18870

1411

ment 690.5 666.6 148.6

124.70

Partner 8 7 1

ship

(L.P.)

(herein

after

referre

d to as“Haohong

Investment”)

Ningb

Haoyi

Equity

Invest

ment

Partner

88758-88741

ship

580.717414166.0

(L.P)

1.665

(herein

after

referre

d to as“Haoying

Investment”)

120081386610761

Subtot 1393

4271.666.61314.

al 710.04

29766

120081386610761

1393

Total 4271. 666.6 1314.

710.04

29766

The recoverable amount is determined based on the net amount of the fair value minus disposal costs

□ Applicable □ Not applicable

The recoverable amount is determined by the present value of the forecasted future cash flow.

107Lu Thai Textile Co. Ltd. Interim Report 2025

□ Applicable □ Not applicable

12. Other Non-current Financial Assets

Unit: RMB

Item Ending balance Beginning balance

Equity instrument investment 70800000.00 70800000.00

Financial assets assigned measured

12000000.0012000000.00

by fair value through profit or loss

Total 82800000.00 82800000.00

13. Investment Property

(1) Investment Property Adopting the Cost Measurement Mode

□ Applicable □ Not applicable

Unit: RMB

Construction in

Item Houses and buildings Land use rights Total

progress

I. Original carrying value

1. Beginning balance 33708658.12 33708658.12

2. Increased amount for the

Current Period

(1) Outsourcing

(2) Transfer from

inventory/fixed

assets/construction in progress

(3) Business

combination increase

3. Decreased amount for the

Current Period

(1) Disposal

(2) Other transfer

4. Ending balance 33708658.12 33708658.12

II. Accumulative depreciation

and accumulative amortization

1. Beginning balance 15033124.49 15033124.49

2. Increased amount for the

451321.15451321.15

Current Period

(1) Withdrawal or

451321.15451321.15

amortization

3. Decreased amount for the

Current Period

(1) Disposal

(2) Other transfer

108Lu Thai Textile Co. Ltd. Interim Report 2025

4. Ending balance 15484445.64 15484445.64

III. Impairment provisions

1. Beginning balance

2. Increased amount for the

Current Period

(1) Withdrawal

3. Decreased amount for the

Current Period

(1) Disposal

(2) Other transfer

4. Ending balance

IV. Carrying value

1. Ending carrying value 18224212.48 18224212.48

2. Beginning carrying value 18675533.63 18675533.63

The recoverable amount is determined based on the net amount of the fair value minus disposal costs

□ Applicable □ Not applicable

The recoverable amount is determined by the present value of the forecasted future cash flow.□ Applicable □ Not applicable

(2) Investment Property Adopting the Fair Value Measurement Mode

□ Applicable □ Not applicable

14. Fixed Assets

Unit: RMB

Item Ending balance Beginning balance

Fixed assets 5814725044.82 6053755987.08

Total 5814725044.82 6053755987.08

(1) List of Fixed Assets

Unit: RMB

Electronic

Housing and Machinery Transportation

Item equipment and Total

building equipment vehicle

others

I. Original

carrying value:

1. Beginning

4153405489.187999497701.2657627023.34146359617.5412356889831.32

balance

2. Increased

amount for the 4080478.24 24371882.83 1646309.14 1380548.69 31479218.90

Current Period

(1)

24371882.831646309.141380548.6927398740.66

Purchase

109Lu Thai Textile Co. Ltd. Interim Report 2025

(2)

Transfer from

4080478.244080478.24

construction in

progress

(3)

Business

combination

increase

3. Decreased

amount for the 8202476.87 71941811.89 386677.89 164728.10 80695694.75

Current Period

(1)

2013535.9266387431.9112362.74134194.0468547524.61

Disposal or scrap

(2) Transfer from

construction in 4246715.11 4246715.11

progress

(3) Other decrease 1942225.84 5554379.98 374315.15 30534.06 7901455.03

4. Ending

4149283490.557951927772.2058886654.59147575438.1312307673355.47

balance

II. Accumulative

depreciation

1. Beginning

1451849601.154617189627.3843584449.86121401888.546234025566.93

balance

2. Increased

amount for the 67974901.40 169445964.70 1703497.50 3496951.59 242621315.19

Current Period

(1)

67974901.40169445964.701703497.503496951.59242621315.19

Withdrawal

3. Decreased

amount for the 1698159.75 52094740.26 25910.26 202355.23 54021165.50

Current Period

(1)

42038.8651275696.461996.5988402.1651408134.07

Disposal or scrap

(2) Transfer from

construction in 1101865.17 1101865.17

progress

(3) Other decrease 554255.72 819043.80 23913.67 113953.07 1511166.26

4. Ending

1518126342.804734540851.8245262037.10124696484.906422625716.62

balance

III. Impairment

provisions

1. Beginning

25815444.4843157303.245671.30129858.2969108277.31

balance

2. Increased

amount for the 4509218.16 4509218.16

Current Period

(1)

4509218.164509218.16

Withdrawal

3. Decreased

amount for the 3294401.44 500.00 3294901.44

Current Period

110Lu Thai Textile Co. Ltd. Interim Report 2025

(1)

3294401.44500.003294901.44

Disposal or scrap

4. Ending

25815444.4844372119.965671.30129358.2970322594.03

balance

IV. Carrying value

1. Ending

2605341703.273173014800.4213618946.1922749594.945814725044.82

carrying value

2. Beginning

2675740443.553339150770.6414036902.1824827870.716053755987.08

carrying value

(2) Fixed Assets Leased out by Operation Lease

Unit: RMB

Item Ending carrying value

Houses 4373314.83

(3) Fixed Assets Failed to Accomplish Certification of Property

Unit: RMB

Item Carrying value Reason

Under the relevant certificate procedures of

LuFeng weaving dye grey yarn acceptance measurement examination by

11106179.64

warehouse the real estate trading center and other

departments

Lu Thai Textile Warehouse 01 02 5857460.42 The same as above

Lulian New Materials Yarn Warehouse 7421417.57 The same as above

To be submitted to the relevant department

Overseas production base factory 1019013437.45

for processing upon completion

(4) Impairment Test of Fixed Assets

□ Applicable □ Not applicable

15. Construction in Progress

Unit: RMB

Item Ending balance Beginning balance

Construction in progress 111498885.45 77047650.62

Engineering materials 22785304.89 17979058.75

Total 134284190.34 95026709.37

(1) List of Construction in Progress

Unit: RMB

Ending balance Beginning balance

Item Provision Provision

Carrying amount for Carrying value Carrying amount for Carrying value

impairmen impairme

111Lu Thai Textile Co. Ltd. Interim Report 2025

t losses nt losses

Production line

project of high-

29531376.9529531376.9523298916.4423298916.44

grade fabrics (Phase

Reform project of

Xinsheng Thermal 2861483.18 2861483.18 1824455.78 1824455.78

Power

Thermoelectric

8899559.628899559.62

cogeneration project

Other sporadic

70206465.7070206465.7051924278.4051924278.40

projects

Total 111498885.45 111498885.45 77047650.62 77047650.62

(2) Changes in Significant Construction in Progress during the Reporting Period

Unit: RMB

Propor

Amou which:

Other tion of Capital

nt of Accum Amou

Increas decrea accum ization

transfe ulated nt of

ed sed ulated rate of

Beginn r into amoun interes

amoun amoun Ending invest Project interes

Project ing fixed t of t Source

Budget t of the t for balanc ment progre ts for

name balanc assets interes capital of fund

Curren the e in ss the

e in the t ization

t Curren constr Curren

Curren capital in the

Period t uctions t

t ization Curren

Period to Period

Period t

budget

Period

Produc

tion

line Fund

project raising

46480232982953111598

of 6442 20988 109.48 99.00 and

0000.916.4376.9184.1

high- 347.65 7.14 % % self-

00456

grade financi

fabrics ng

(Phase

Refor

project

46001824134831130286162.2162.21

Xinshe Others

000.00455.78336.929.52483.18%%

Therm

Power

Therm

oelectr

25000

ic 8899 8899

0000. 3.56% 3.56% Others

cogene 559.62 559.62

ration

project

Other 51924 22487 4080 12524 70206 Others

112Lu Thai Textile Co. Ltd. Interim Report 2025

sporad 278.4 909.2 478.24 3.70 465.7

ic 0 4 0

project

7194077047391781114911598

408064644

Total 0000. 650.6 153.4 8885. 184.1

478.240.36

0023456

(3) Impairment Test of Construction in Progress

□ Applicable □ Not applicable

(4) Engineering Materials

Unit: RMB

Ending balance Beginning balance

Provision Provision

Item Carrying for for

Carrying value Carrying amount Carrying value

amount impairment impairment

losses losses

Equipment to

22785304.8922785304.8917979058.7517979058.75

be installed

Total 22785304.89 22785304.89 17979058.75 17979058.75

16. Right-of-use Assets

(1) List of Right-of-use Assets

Unit: RMB

Item Houses and buildings Land use rights Total

I. Original carrying value

1. Beginning balance 77622142.84 466180291.02 543802433.86

2. Increased amount for the

3351405.970.003351405.97

Current Period

(1) Rent 3351405.97 0.00 3351405.97

3. Decreased amount for the

1661284.212016005.113677289.32

Current Period

(1) Maturity 47085.76 47085.76

(2) Other decrease 1661284.21 1968919.35 3630203.56

4. Ending balance 79312264.60 464164285.91 543476550.51

II. Accumulative depreciation

1. Beginning balance 25569781.22 47993724.45 73563505.67

2. Increased amount for the

5492240.527890303.0613382543.58

Current Period

(1) Withdrawal 5492240.52 7890303.06 13382543.58

3. Decreased amount for the

310814.39178161.48488975.87

Current Period

113Lu Thai Textile Co. Ltd. Interim Report 2025

(1) Disposal

(2) Maturity 47085.76 47085.76

(3) Other decrease 310814.39 131075.72 441890.11

4. Ending balance 30751207.35 55705866.03 86457073.38

III. Impairment provisions

1. Beginning balance

2. Increased amount for the

Current Period

(1) Withdrawal

3. Decreased amount for the

Current Period

(1) Disposal

4. Ending balance

IV. Carrying value

1. Ending carrying value 48561057.25 408458419.88 457019477.13

2. Beginning carrying value 52052361.62 418186566.57 470238928.19

(2) Impairment Test of Right-of-use Assets

□ Applicable □ Not applicable

17. Intangible Assets

(1) List of Intangible Assets

Unit: RMB

Non-patent Software use Trademark

Item Land use rights Patent right Total

technologies rights right

I. Original

carrying value

1. Beginning

470338494.00409550.002264253.12283018.87473295315.99

balance

2. Increased

amount for the

Current Period

(1) Purchase

(2) Internal R&D

(3) Business

combination

increase

3. Decreased

amount for the 221897.09 221897.09

Current Period

(1) Disposal 221238.94 221238.94

(2) Other

658.15658.15

decrease

114Lu Thai Textile Co. Ltd. Interim Report 2025

4. Ending

470338494.00409550.002042356.03283018.87473073418.90

balance

II. Accumulated

amortization

1. Beginning

138514719.12153581.401235686.146581.83139910568.49

balance

2. Increased

amount for the 5048199.62 20477.52 385527.73 39490.98 5493695.85

Current Period

(1) Withdrawal 5048199.62 20477.52 385527.73 39490.98 5493695.85

3. Decreased

amount for the 221606.43 221606.43

Current Period

(1) Disposal 221238.94 221238.94

(2) Other

367.49367.49

decrease

4. Ending

143562918.74174058.921399607.4446072.81145182657.91

balance

III. Impairment

provisions

1. Beginning

balance

2. Increased

amount for the

Current Period

(1) Withdrawal

3. Decreased

amount for the

Current Period

(1) Disposal

4. Ending

balance

IV. Carrying

value

1. Ending

326775575.26235491.08642748.59236946.06327890760.99

carrying value

2. Beginning

331823774.88255968.601028566.98276437.04333384747.50

carrying value

The proportion of intangible assets formed from the internal R&D of the Company at the period-end to the ending balance of

intangible assets was 0.00%.

(2) Impairment Test of Intangible Assets

□ Applicable □ Not applicable

115Lu Thai Textile Co. Ltd. Interim Report 2025

18. Goodwill

(1) Original Carrying Value of Goodwill

Unit: RMB

Increased amount of the Decreased amount for the

Name of the invested Current Period Current Period

Beginning

units or events

balance Formed by

Ending balance

generating goodwill business Disposal

combination

Xinsheng Thermal

20563803.2920563803.29

Power

Total 20563803.29 20563803.29

19. Long-term Deferred Expenses

Unit: RMB

Increased amount Amortization

Other decreased

Item Beginning balance of the Current amount of the Ending balance

amount

Period Current Period

Decoration fee 5558870.87 2100425.27 3458445.60

Technical service

8844.20110211.7927212.8491843.15

charges

Other prepaid

66845.2066845.20

expense

Total 5634560.27 110211.79 2194483.31 3550288.75

20. Deferred Income Tax Assets/Deferred Income Tax Liabilities

(1) Deferred Income Tax Assets Had Not Been Off-set

Unit: RMB

Ending balance Beginning balance

Item Deductible temporary Deferred income tax Deductible temporary Deferred income tax

differences assets differences assets

Provision for

255180473.5240882231.42252197942.7741534310.54

impairment of assets

Internal unrealized

92861284.2310317796.55105336586.0613724860.21

profit

Deductible losses 46878524.12 7031778.62 46878524.12 7031778.62

Payroll payable 73682968.78 11052700.68 73682968.78 11052700.68

Deferred income 142118383.17 21945520.20 145143951.32 22467375.60

Contract liabilities 72853803.20 18213450.80 78698329.68 19615211.56

The changes of

receivables financing 120350.60 18052.59 50005.02 7500.75

in fair value

Lease liabilities 90620990.83 13576799.37 99332484.45 14899872.67

Convertible bonds 72707821.07 10906173.16 72707821.06 10906173.16

Associated enterprises 29225591.47 4383838.72 30636716.16 4595507.42

Fund losses 17968191.53 2695228.73

116Lu Thai Textile Co. Ltd. Interim Report 2025

Total 876250190.99 138328342.11 922633520.95 148530519.94

(2) Deferred Income Tax Liabilities Had Not Been Off-set

Unit: RMB

Ending balance Beginning balance

Item Taxable temporary Deferred income tax Taxable temporary Deferred income tax

difference liabilities difference liabilities

Depreciation of fixed

616696613.1096995768.89606505309.1795362712.06

assets

Changes in fair value

of held-for-trading 43855675.00 6578351.25 122951766.13 18442764.92

financial assets

Changes in the fair

value of other non- 13517400.00 2027610.00 13517400.00 2027610.00

current financial assets

Associated enterprises 12983349.53 1947502.43 13000764.22 1950114.63

Right-of-use assets 82701721.35 12405258.20 91572241.18 13735836.18

Fund profit 4557979.97 683697.00

Total 774312738.95 120638187.77 847547480.70 131519037.79

(3) Deferred Income Tax Assets or Liabilities Had Been Off-set Listed in Net Amount

Unit: RMB

Beginning off-set

Ending off-set amount Ending balance of Beginning balance of

amount of deferred

Item of deferred income tax deferred income tax deferred income tax

income tax assets and

assets and liabilities assets and liabilities assets and liabilities

liabilities

Deferred income tax

138328342.11148530519.94

assets

Deferred income tax

120638187.77131519037.79

liabilities

(4) List of Unrecognized Deferred Income Tax Assets

Unit: RMB

Item Ending balance Beginning balance

Deductible temporary differences 45730872.48 42605021.03

Deductible losses 268375550.32 315591935.20

Total 314106422.80 358196956.23

(5) Deductible Losses of Unrecognized Deferred Income Tax Assets Will Due in the Following Years

Unit: RMB

Year Ending amount Beginning amount Note

Y2025 299.83

Y2026 71029659.21

Y2027 96904257.37 96904257.37

Y2028 87257787.10 87257787.10

Y2029 60399931.69 60399931.69

117Lu Thai Textile Co. Ltd. Interim Report 2025

Y2030 23813574.16

Total 268375550.32 315591935.20

21. Other Non-current Assets

Unit: RMB

Ending balance Beginning balance

Provision Provision

Item for for

Carrying amount Carrying value Carrying amount Carrying value

impairme impairme

nt losses nt losses

Prepayment for

7293481.707293481.70797518.51797518.51

equipment

Prepayment for

25326606.1625326606.1625432036.3925432036.39

land transfer fee

Term deposits

349050116.88349050116.88525000000.00525000000.00

over 1 year

Interest

receivable from

10916368.9510916368.9518724767.8018724767.80

term deposits

over 1 year

Total 392586573.69 392586573.69 569954322.70 569954322.70

22. Assets with Restricted Ownership or Right to Use

Unit: RMB

Period-end Period-beginning

Item Carrying Carrying Type of Status of Carrying Carrying Type of Status of

amount value restriction restriction amount value restriction restriction

Endorsed Endorsed

or or

discounted discounted

Notes 19797413. 19797413. 34463775. 34463775.but not yet but not yet

receivable 77 77 21 21

due for due for

derecogniz derecogniz

ation ation

Other Deposit for Deposit for

3852177.93852177.949999919.49999919.

current recognizan recognizan

889797

assets ce ce

23649591.23649591.84463695.84463695.

Total

75751818

23. Short-term Loans

(1) Category of Short-term Loans

Unit: RMB

Item Ending balance Beginning balance

Borrowings secured by guarantee 120393839.05 91941851.96

Credit loan 649134450.17 757744972.37

Total 769528289.22 849686824.33

118Lu Thai Textile Co. Ltd. Interim Report 2025

Notes of the category for short-term loans:

The short-term loans include interest payable of RMB617114.63.

24. Held-for-trading Financial Liabilities

Unit: RMB

Item Ending balance Beginning balance

Held-for-trading financial liabilities 836220.67 15858713.22

Of which:

Derivative financial liabilities 836220.67 15858713.22

Of which:

Total 836220.67 15858713.22

25. Accounts Payable

(1) List of Accounts Payable

Unit: RMB

Item Ending balance Beginning balance

Payment for goods 125963803.08 174951225.51

Engineering equipment 29049898.41 58703628.27

Others 19234857.28 38424237.73

Total 174248558.77 272079091.51

(2) Significant Accounts Payable Aging over One Year or Overdue

Other notes

No significant accounts payable over one year at the period-end.

26. Other Payables

Unit: RMB

Item Ending balance Beginning balance

Dividends payable 75441113.64 441113.64

Other payables 19703690.74 16996685.96

Total 95144804.38 17437799.60

(1) Dividends Payable

Unit: RMB

Item Ending balance Beginning balance

Dividends payable to individual

441113.64441113.64

shareholders

Dividends payable to non-controlling

75000000.00

interests

Total 75441113.64 441113.64

119Lu Thai Textile Co. Ltd. Interim Report 2025

Other notes: Including significant dividends payable unpaid for over one year the unpaid reason shall be disclosed:

Item Ending Beginningbalance balance Reason

Dividends payable to individual 441113.64 441113.64 Cash dividend of previous year not received byshareholders individual shareholders

Total 441113.64 441113.64

(2) Other Payables

1) Other payables listed by nature

Unit: RMB

Item Ending balance Beginning balance

Deposits and cash deposits etc. 6265774.01 5412393.10

Collecting payment on behalf of others 5303655.52 2071915.32

Others 8134261.21 9512377.54

Total 19703690.74 16996685.96

27. Contract Liabilities

Unit: RMB

Item Ending balance Beginning balance

Advance from sales 162764875.12 200833613.26

Less: Contract liability recorded in other

-5210873.34-9282609.47

current liabilities

Total 157554001.78 191551003.79

28. Payroll Payable

(1) List of Payroll Payable

Unit: RMB

Decreased amount

Increased amount of

Item Beginning balance for the Current Ending balance

the Current Period

Period

I. Short-term salary 301211370.26 696616377.81 762664625.72 235163122.35

II. Post-employment benefit-

15991.6386546234.6286441810.90120415.35

defined contribution plans

III. Termination benefits 420365.94 420365.94 0.00

Total 301227361.89 783582978.37 849526802.56 235283537.70

(2) List of Short-term Salary

Unit: RMB

Decreased amount

Increased amount of

Item Beginning balance for the Current Ending balance

the Current Period

Period

1. Salary bonus allowance 224822772.16 621501364.71 691619168.27 154704968.60

120Lu Thai Textile Co. Ltd. Interim Report 2025

subsidy

2. Employee welfare 2.80 19626999.41 19441145.68 185856.53

3. Social insurance 33294.34 38537429.38 38510632.30 60091.42

Of which: Medical insurance

31414.9135527503.0435513050.2145867.74

premiums

Work-related injury

1104.083005437.952993039.1313502.90

insurance premiums

Maternity insurance 775.35 4488.39 4542.96 720.78

4. Housing fund 6937215.90 6937215.90 0.00

5. Labor-union expenditure and

76355300.9610013368.416156463.5780212205.80

employee education budget

Total 301211370.26 696616377.81 762664625.72 235163122.35

(3) List of Defined Contribution Plans

Unit: RMB

Increased amount of Decreased amount for

Item Beginning balance Ending balance

the Current Period the Current Period

1. Basic pension

15507.0482316794.7182217851.44114450.31

insurance

2. Unemployment

484.594229439.914223959.465965.04

insurance premiums

Total 15991.63 86546234.62 86441810.90 120415.35

Other notes:

The Company in line with the requirement participates in endowment insurance unemployment insurance plans and so on.Under these plans the Company makes monthly contributions to these plans at 16% and 0.7% of the social security contribution

base respectively. No further payment obligations will be incurred by the Company beyond the above monthly contribution fees.The relevant expense occurred was recorded into current profits and losses or related asset costs.

29. Taxes Payable

Unit: RMB

Item Ending balance Beginning balance

VAT 1551256.26 13958538.83

Enterprise income tax 31721166.99 27102242.22

Personal income tax 507660.95 1581994.81

Urban maintenance and construction tax 1082297.61 3433797.45

Stamp duty 541625.07 826522.82

Real estate tax 5493756.47 5239688.51

Land use tax 2561319.97 2097384.98

Educational fee 513763.69 1551805.29

Local educational surcharge 342509.13 1039303.54

Tax on natural resources 116670.60 160264.60

Environmental protection tax 168803.97 270404.96

121Lu Thai Textile Co. Ltd. Interim Report 2025

Total 44600830.71 57261948.01

30. Current Portion of Non-current Liabilities

Unit: RMB

Item Ending balance Beginning balance

Long-term borrowings matured within

12426401.7212676401.72

one year

Current portion of bonds payable 1511268255.48

Lease liabilities matured within one year 16004745.09 15112170.03

Total 1539699402.29 27788571.75

31. Other Current Liabilities

Unit: RMB

Item Ending balance Beginning balance

Tax to be charged off 5210873.34 9282609.47

Endorsed undue bill under non-

19797413.7733546850.71

derecognition

Total 25008287.11 42829460.18

32. Long-term Borrowings

(1) Category of Long-term Borrowings

Unit: RMB

Item Ending balance Beginning balance

Credit loan 420580998.63 408920511.93

Less: Current portion of long-term

-12426401.72-12676401.72

borrowings

Total 408154596.91 396244110.21

Note to the category of long-term borrowings:

Item Ending balance Interest rate range Beginning balance Interest rate range(%) (%)

Credit loan 420580998.63 1.95%-2.34% 408920511.93 2.05-2.80

33. Bonds Payable

(1) Bonds Payable

Unit: RMB

Item Ending balance Beginning balance

Convertible bonds 1511268255.48 1509420449.46

Less: Bonds payable due within one year -1511268255.48

Total 1509420449.46

122Lu Thai Textile Co. Ltd. Interim Report 2025

(2) Changes of Bonds Payable (excluding other financial instruments divided as financial liabilities such

as preferred shares and perpetual bonds)

Unit: RMB

Amort

izatio

Intere Repai s

Issued n of

Begin st d in conve Endin

Coup Bond Issue in the premi Defau

Par Issue ning accrue the rted in g

Name on durati amou Repor um lt or

value date balanc d at Curre the balanc

rate on nt ting and not

e par nt Curre e

Period depre

value Period nt

ciatio

Period

LuTh

Conve 1400 April 1400 1509 4178 2519 1511

14733500.

rtible 0000 9 6 0000 4204 2418. 7206. 2682 Not

3905.00

Bond 00.00 2020 00.00 49.46 48 96 55.48

(1270

16)

Less:

Bonds

payab

1511

le due Not

2682

within

55.48

one

year

1400150941782519

14733500.

Total 0000 4204 2418. 7206. 0.00

3905.00

00.0049.464896

(3) Notes to the Convertible Corporate Bonds

According to the Approval of the Public Issue of Convertible Corporate Bonds of Lu Thai Textile Co. Ltd. (ZH.J.X.K [2020] No.

299) of the China Securities Regulatory Commission the Company issued 14 million convertible bonds with a par value of

RMB100 each for a total issue amount of RMB1.4 billion with a maturity of 6 years i.e. from April 9 2020 to April 8 2026.The coupon rates of the convertible bonds issued by the Company are 0.3% 0.6% 1% 1.5% 1.8% and 2% in the following order

from the first stage to the sixth stage with interest payable annually. The conversion period shall commence from (and include)

the first trading day on October 15 2020 six months after the date of issue and shall end on (and include) the trading day prior to

the maturity date of the convertible bonds (April 8 2026). Holders may apply for conversion during the conversion period.The initial conversion price of convertible corporate bonds was RMB9.01 per share when it was issued but was adjusted to

RMB8.91 per share since July 9 2020 after the Company implemented the 2019 Distribution of Profit on July 8 2020. After the

Company implemented the restricted stock incentive plan in 2021 the price was adjusted to RMB8.76 per share accordingly since

June 7 2021. Upon the implementation of the 2020 Distribution of Profit by the Company on June 18 2021 it was adjusted to

RMB8.71 per share accordingly again since June 18 2021. Upon the implementation of the 2021 Distribution of Profit by the

Company on June 23 2022 it was adjusted to RMB8.61 per share accordingly again since June 23 2022. The Company

completed the formalities for cancellation of the repurchased shares on May 25 2023 and the conversion price of the convertible

bond was adjusted accordingly to RMB8.73 per share on May 26 2023. Upon the implementation of the 2021 Distribution of

Profit by the Company on June 16 2023 the conversion price of the convertible bond was adjusted to RMB8.63 per share

accordingly on June 16 2023. The Company completed the formalities for cancellation of the repurchased shares on March 1

123Lu Thai Textile Co. Ltd. Interim Report 2025

2024 and the conversion price of the convertible bond was adjusted accordingly to RMB8.87 per share on March 4 2024. Upon

the implementation of the 2023 Profit Distribution Plan by the Company on June 19 2024 the conversion price of the convertible

bond was adjusted to RMB8.74 per share accordingly on June 19 2024. Upon the implementation of the 2024 Interim Profit

Distribution Plan by the Company on November 8 2024 the conversion price of the convertible bond was adjusted to RMB8.64

per share accordingly on November 8 2024. Upon the implementation of the 2024 Q3 Profit Distribution Plan by the Company on

December 19 2024 the conversion price of the convertible bond was adjusted to RMB8.59 per share accordingly on 1December

19 2024. Upon the implementation of the 2024 Profit Distribution Plan by the Company on June 20 2025 the conversion price of

the convertible bond was adjusted to RMB8.49 per share accordingly on June 20 2025.

34. Lease Liabilities

Unit: RMB

Item Ending balance Beginning balance

Lease payments 120093248.49 133128147.33

Unrecognized financing costs -23706116.36 -26662656.50

Less: Current portion of lease liabilities -16004745.09 -15112170.03

Total 80382387.04 91353320.80

Other notes

The amount of interest expense on lease liabilities accrued in H1 2025 was RMB2249361.75 which was included in financial

expenses - interest expense.

35. Long-term Payroll Payable

(1) List of Long-term Payroll Payable

Unit: RMB

Item Ending balance Beginning balance

III. Other long-term welfare 58494991.36 58494991.36

Total 58494991.36 58494991.36

36. Deferred Income

Unit: RMB

Increased amount Decreased amount

Item Beginning balance of the Current for the Current Ending balance Source

Period Period

Government grants 145395121.11 640000.00 3674182.34 142360938.77 Government grants

Total 145395121.11 640000.00 3674182.34 142360938.77

37. Share Capital

Unit: RMB

Increase/decrease in the Reporting Period (+/-)

Beginning Shares as Shares as Ending balance

balance New issues dividend dividend Others Subtotal

converte converted

124Lu Thai Textile Co. Ltd. Interim Report 2025

d from from capital

profit reserves

Total shares 817306010.00 412.00 412.00 817306422.00

Other notes

During the Current Period the Company converted 412 shares of convertible bonds into equity.

38. Other Equity Instruments

(1) Changes of Outstanding Financial Instruments Such as Preferred Shares and Perpetual Bonds at the Period-End

Unit: RMB

Increased amount of Decreased amount for

Outstanding Period-beginning Period-endthe Current Period the Current Period

financial

instruments Numbe Carrying Numb Carrying NumNumber Carrying value Carrying value

r value er value ber

Convertible debt

71383438.11178.4871383259.63

to equity

Total 71383438.11 178.48 71383259.63

39. Capital Reserves

Unit: RMB

Decreased

Increased amount of

Item Beginning balance amount for the Ending balance

the Current Period

Current Period

Capital premium (premium on

125363080.003374.76125366454.76

stock)

Other capital reserves 53155587.31 224355.04 53379942.35

Total 178518667.31 227729.80 178746397.11

Other notes including a description of the increase or decrease for the Current Period and the reasons for the change:

(1) Recovery of RMB224307.75 in restricted stock proceeds from employees who left under the equity incentive plan.

(2) Fractional dividend of RMB47.29 for the 2024 B-share equity dividend distribution.

(3) Convertible bonds converted into equity during the Current Period increased capital reserve - share capital premium by

RMB3374.76.

40. Other Comprehensive Income

Unit: RMB

Amount for the Current Period

Amount Less: Less: Attributabl

Beginning Attributabl

Item before Recorded Recorded Less: e to the

Ending

balance e minoritydeducting in other in other Income tax parent balanceshareholder

income tax comprehen comprehen expense company s after tax

for the sive sive after tax

125Lu Thai Textile Co. Ltd. Interim Report 2025

Current income in income in

Period prior period prior period

and and

transferred transferred

in profit or in retained

loss in the earnings in

Current the Current

Period Period

II. Other

comprehen

sive

income that

may 16692598 15509478

11841747.-10551.8411831196.0.00

subsequentl 5.26 9.13

9713

y be

reclassified

to profit or

loss

Differ

ences

arising

from the

translation 16696683 15519543

11771402.11771402.

of foreign 4.99 2.61

3838

currency-

denominate

d financial

statements

The

changes of

accounts

receivable -40849.73 -70345.59 -10551.84 -59793.75

100643.48

financing

in fair

value

Total of

other - -

1669259815509478

comprehen 11841747. -10551.84 11831196.

5.269.13

sive 97 13

income

41. Specific Reserve

Unit: RMB

Increased amount of Decreased amount for

Item Beginning balance Ending balance

the Current Period the Current Period

Safety production costs 7971427.33 3761316.98 4210110.35

Total 7971427.33 3761316.98 4210110.35

42. Surplus Reserves

Unit: RMB

Item Beginning balance Increased amount of Decreased amount for Ending balance

126Lu Thai Textile Co. Ltd. Interim Report 2025

the Current Period the Current Period

Other capital reserves 1268087709.86 1268087709.86

Statutory surplus

3341572.583341572.58

reserves

Total 1271429282.44 1271429282.44

43. Retained Earnings

Unit: RMB

Item Reporting period Same period of last year

Beginning balance of retained earnings

6933165006.166762457543.07

before adjustments

Beginning balance of retained earnings after

6933165006.166762457543.07

adjustments

Add: Net profit attributable to owners of the

360215726.72169559969.54

parent company

Dividends of common shares payable 81730601.00 106249766.48

Ending retained earnings 7211650131.88 6825767746.13

List of adjustment of beginning retained earnings:

1) RMB0.00 beginning retained earnings was affected by retrospective adjustment conducted according to the Accounting

Standards for Business Enterprises and relevant new regulations.

2) RMB0.00 beginning retained earnings was affected by changes in accounting policies.

3) RMB0.00 beginning retained earnings was affected by correction of significant accounting errors.

4) RMB0.00 beginning retained earnings was affected by changes in combination scope arising from same control.

5) RMB0.00 beginning retained earnings was affected totally by other adjustments.

44. Operating Revenue and Cost of Sales

Unit: RMB

Amount for the Current Period H1 2024

Item

Operating revenue Cost of sales Operating revenue Cost of sales

Main operations 2761593924.22 2114102945.55 2763053072.61 2078775369.49

Other operations 65516215.48 54371950.71 67435613.00 53218122.64

Total 2827110139.70 2168474896.26 2830488685.61 2131993492.13

Information about performance obligations: None.Information in relation to the transaction price apportioned to the residual contract performance obligation:

The amount of revenue corresponding to performance obligations of contracts signed but not performed or not fully performed yet

was RMB0.00 at the period-end among which RMB0.00 was expected to be recognized in XXX RMB0.00 was expected to be

recognized in XXX and RMB0.00 was expected to be recognized in XXX.

45. Taxes and Surcharges

Unit: RMB

Item Amount for the Current Period H1 2024

Urban maintenance and construction tax 7709315.81 6289033.04

127Lu Thai Textile Co. Ltd. Interim Report 2025

Educational fee 3352777.94 2739134.65

Tax on natural resources 225561.60 501124.97

Real estate tax 11082230.94 11076205.06

Land use tax 5126449.13 4779301.36

Vehicle and vessel usage tax 41816.34 44897.44

Stamp duty 972888.98 1184777.08

Local education surcharge 2235185.25 1826088.21

Environmental protection tax 493208.95 684824.01

Total 31239434.94 29125385.82

Other notes

Please refer to Note VI. Taxes for details of various taxes and surcharges standards for calculation and payment.

46. Administrative Expense

Unit: RMB

Item Amount for the Current Period H1 2024

Salaries 75165450.56 77230152.38

Depreciation charges 19839428.51 20703778.67

Warehouse funding 18803130.99 18344401.07

Labor-union expenditure 5179275.40 5236534.53

Employee education budget 3555159.13 3801648.86

Amortization of intangible assets 6915254.58 6729562.66

Carriage charges 3940267.62 4767761.97

Others 29549110.60 21991320.55

Total 162947077.39 158805160.69

47. Selling Expense

Unit: RMB

Item Amount for the Current Period H1 2024

Salaries 32470002.40 32065926.42

Marketing expense 16455458.63 16111399.23

Depreciation charges 2417716.59 3344566.64

Business travel expenses 3481536.38 3231195.05

Office operating fee 9776313.03 5569616.81

Others 5097062.74 2964017.13

Total 69698089.77 63286721.28

48. R&D Expense

Unit: RMB

Item Amount for the Current Period H1 2024

Labor cost 56204005.76 63810510.13

Material expense 26511331.44 32672913.93

128Lu Thai Textile Co. Ltd. Interim Report 2025

Depreciation charges 8622551.12 9704000.88

Others 9108731.66 9187172.25

Total 100446619.98 115374597.19

49. Financial Expenses

Unit: RMB

Item Amount for the Current Period H1 2024

Interest expense 47165800.25 50759962.29

Less: Capitalized interest expense 2028489.95

Interest income 34380042.79 24797577.49

Add: Capitalized interest income

Foreign exchange gains or losses -24018113.45 -22788175.63

Less: Capitalized foreign exchange gains

or losses

Others 3429784.88 3103872.71

Total -7802571.11 4249591.93

50. Other Income

Unit: RMB

Sources Amount for the Current Period H1 2024

Government grants 7517472.62 11197161.62

Transfer of deferred revenue to

3674182.343731952.21

government grants

Total 11191654.96 14929113.83

51. Gain on Changes in Fair Value

Unit: RMB

Sources of gain on changes in fair value Amount for the Current Period H1 2024

Held-for-trading financial assets -68635671.97 -78608823.48

Of which: Gain on changes in fair value

generated by derivative financial -4942381.29

instruments

Held-for-trading financial liabilities 15022492.55 -33931003.79

Total -53613179.42 -112539827.27

52. Investment Income

Unit: RMB

Item Amount for the Current Period H1 2024

Long-term equity investments income

1393710.048619094.53

accounted by equity method

Investment income from disposal of

196029346.86-11908540.91

held-for-trading financial asset

Interest income from debt investments

2120807.51

during the holding period

Total 199543864.41 -3289446.38

129Lu Thai Textile Co. Ltd. Interim Report 2025

53. Credit Impairment Loss

Unit: RMB

Item Amount for the Current Period H1 2024

Loss on uncollectible notes receivable -27500.00 -331749.55

Loss on uncollectible accounts

-6459634.43891673.39

receivable

Loss on uncollectible other receivables -80208.77 27530.58

Total -6567343.20 587454.42

54. Asset Impairment Loss

Unit: RMB

Item Amount for the Current Period H1 2024

I. Inventory falling price loss and impairment

-29091375.28-34719445.19

provision for contract performance costs

IV. Fixed assets impairment losses -4509218.17

Total -33600593.45 -34719445.19

55. Asset Disposal Income

Unit: RMB

Source of asset disposal income Amount for the Current Period H1 2024

Impairment loss on fixed assets (“-” for

-459023.14-232868.16

loss)

56. Non-operating Income

Unit: RMB

Amount for the Current Amount recorded in the current

Item H1 2024

Period non-recurring profit or loss

Claim income 6576005.30 2268221.27 6576005.30

Others 2201405.95 609798.53 2201405.95

Total 8777411.25 2878019.80 8777411.25

57. Non-operating Expense

Unit: RMB

Amount for the Current Amount recorded in the current non-

Item H1 2024

Period recurring profit or loss

Donations 643300.48 699531.71 643300.48

Others 2271855.47 1667153.49 2271855.47

Total 2915155.95 2366685.20 2915155.95

130Lu Thai Textile Co. Ltd. Interim Report 2025

58. Income Tax Expense

(1) List of Income Tax Expense

Unit: RMB

Item Amount for the Current Period H1 2024

Current income tax expense 57174040.37 27358172.92

Deferred income tax expense -668120.35 -8493367.13

Total 56505920.02 18864805.79

(2) Adjustment Process of Accounting Profit and Income Tax Expense

Unit: RMB

Item Amount for the Current Period

Profit before tax 424464227.93

Current income tax expense accounted at statutory/applicable tax rate 63669634.19

Influence of applying different tax rates by subsidiaries 10670479.08

Influence of income tax before adjustment -544672.37

Effect of deductible temporary differences or deductible losses on deferred

-3913628.09

income tax assets not recognized in the period

Influence of additional deduction of R&D expenses -13375892.79

Income tax expense 56505920.02

59. Other Comprehensive Income

Refer to Note VII-40 for details.

60. Cash Flow Statement

(1) Cash Related to Operating Activities

Cash generated from other operating activities

Unit: RMB

Item Amount for the Current Period H1 2024

Government grants 2252168.15 3216502.43

Claim income 4895904.55 2414067.12

Recovery of employee borrowings guarantee

13450587.748194771.46

deposit and cash deposit

Collection for employees 1929902.80 346822.55

Others 2790766.39 1069421.84

Total 25319329.63 15241585.40

Cash used in other operating activities

Unit: RMB

Item Amount for the Current Period H1 2024

131Lu Thai Textile Co. Ltd. Interim Report 2025

Business travel charges 18229532.20 18759630.87

Insurance 2041400.38 3018009.97

Audit advisory announcement fee 2383967.23 2118482.59

Decoration fee 1061443.64 6256818.44

Donations 602561.40 689277.94

Payment of employee borrowings petty

11815144.406682473.24

cash and deposit

Agency service fee 21250368.31 7462933.03

Others 45093830.08 27914867.85

Total 102478247.64 72902493.93

(2) Cash Related to Investing Activities

Cash generated from other investing activities

Unit: RMB

Item Amount for the Current Period H1 2024

Interest income 30860778.46 25561955.08

Income from forward foreign exchange 623600.00

Recovery of cash deposit 1457909.57

Recovery of fixed time deposits 255211287.22 25054958.83

Proceeds from financing securities 2394104.88

Total 286072065.68 55092528.36

Cash generated from important investing activities

Unit: RMB

Item Amount for the Current Period H1 2024

Government bond reverse repo 1383943000.00 140961000.00

Structural deposits 2499100000.00 226000000.00

Recovery of proceeds from industrial

13932363.58

investment funds

Total 3896975363.58 366961000.00

Cash used in other investing activities

Unit: RMB

Item Amount for the Current Period H1 2024

Term deposits 52675673.76 184000000.00

Forward settlement exchange loss 3380600.00

Total 52675673.76 187380600.00

Cash used in significant investing activities

Unit: RMB

Item Amount for the Current Period H1 2024

Government bond reverse repo 1534114000.00 90000000.00

Structural deposits 2739100000.00 226000000.00

132Lu Thai Textile Co. Ltd. Interim Report 2025

Wealth management products 150000000.00

Total 4273214000.00 466000000.00

(3) Cash Related to Financing Activities

Cash used in other financing activities

Unit: RMB

Item Amount for the Current Period H1 2024

Repayment of lease liabilities and

9250108.129319173.11

prepaid rent

B shares repurchase 37825078.13

Total 9250108.12 47144251.24

Changes in liabilities arising from financing activities

□ Applicable □ Not applicable

Unit: RMB

Increased amount of the Current Period Decreased amount for the Current Period

Item Beginning balance Ending balance

Cash fluctuations Non-cash fluctuations Cash fluctuations Non-cash fluctuations

Short-term

loans 849686824.33 775615516.62 850485289.27 5288762.46 769528289.22

Long-term

borrowings 408920511.93 20000000.00 123687.56 8463200.86 420580998.63

Bonds

payable 1509420449.46 27048512.98 25197206.96 3500.00 1511268255.48

Lease

liabilities 106465490.83 2917963.88 12996322.58 96387132.13

Total 2874493276.55 795615516.62 30090164.42 897142019.67 5292262.46 2797764675.46

61. Supplemental Information for Cash Flow Statement

(1) Supplemental Information for Cash Flow Statement

Unit: RMB

Supplemental information H1 2025 Same period of last year

1. Reconciliation of net profit to net cash flows generated from

operating activities:

Net profit 367958307.91 174035246.63

Add: Provision for impairment of assets 40167936.65 34131990.77

Depreciation of fixed assets oil-gas assets and productive

243072636.34239784009.94

biological assets

Depreciation of right-of-use assets 13382543.58 12660992.42

Amortization of intangible assets 5493695.85 5350029.52

Amortization of long-term deferred expenses 2194483.31 671332.62

Losses from disposal of fixed assets intangible assets and other

459023.14232868.16

long-lived assets (gains: negative)

Losses from scrap of fixed assets (gains: negative)

133Lu Thai Textile Co. Ltd. Interim Report 2025

Losses from changes in fair value (gains represented by “-”) 53613179.42 112539827.27

Financial expenses (gains: negative) -11232355.99 1145719.22

Investment loss (gains represented by “-”) -199543864.41 3289446.38

Decrease in deferred income tax assets (gains: negative) 10212729.67 -26215.78

Increase in deferred income tax liabilities (“-” means decrease) -10880850.02 -8467151.35

Decrease in inventory (gains: negative) 4325004.41 -27021239.55

Decrease in accounts receivable generated from operating

41054910.16101833736.62

activities (gains represented by “-”)

Increase in accounts payable used in operating activities

-296283739.06-198738940.18

(decrease represented by “-”)

Others

Net cash flow from operating activities 263993640.96 451421652.69

2. Significant investing and financing activities without involvement of

cash receipts and payments:

Conversion of debt to capital

Convertible corporate bonds matured within one year

Fixed asset under finance lease

3. Net increase/decrease of cash and cash equivalent:

Ending balance of cash 1470044640.51 1651175499.97

Less: Beginning balance of cash 1371412259.52 1353615305.93

Plus: Ending balance of cash equivalents

Less: Beginning balance of cash equivalents

Net increase in cash and cash equivalents 98632380.99 297560194.04

(2) Cash and Cash Equivalents

Unit: RMB

Item Ending balance Beginning balance

I. Cash 1470044640.51 1371412259.52

Including: Cash on hand 7356389.93 4283695.11

Bank deposits on demand 1462324493.06 1367128564.41

Other monetary capital on demand 363757.52

II. Cash equivalents

III. Ending balance of cash and cash

1470044640.511371412259.52

equivalents

62. Foreign Currency Monetary Items

(1) Foreign Currency Monetary Items

Unit: RMB

Closing foreign currency Ending balance converted to

Item Exchange rate

balance RMB

Monetary capitals

134Lu Thai Textile Co. Ltd. Interim Report 2025

Of which: USD 177987964.38 7.1586 1274144641.81

EUR 145514.42 8.4024 1222670.36

HKD 1792560.44 0.9120 1634815.12

JPY 11893205.00 0.0496 589902.97

GBP 27.18 9.8300 267.18

VND 222601653123.00 0.0003 61047605.49

MMK 1953307832.85 0.0034 6658547.69

KHR 698932769.00 0.0018 1247725.92

Accounts receivable

Of which: USD 76324960.22 7.1586 546379860.23

EUR 238184.55 8.4024 2001321.86

HKD

VND 24470942775.00 0.0003 6711057.35

MMK 2672621414.00 0.0034 9110585.05

Other receivables:

Of which: USD 1256614.24 7.1586 8995598.70

EUR 26436.40 8.4024 222129.21

HKD 147149.00 0.9120 134199.89

JPY 1985040.00 0.0496 98457.98

VND 4426992414.00 0.0003 1214084.81

MMK 143538630.00 0.0034 489302.71

Accounts payable:

Of which: USD 7599463.75 7.1586 54401521.20

EUR 27250.00 8.4024 228965.40

JPY 3117200.00 0.0496 154613.12

CHF 4400.00 0.0000 0.00

VND 29726879210.00 0.0003 8152476.72

MMK 136261915.45 0.0034 464497.43

Other payables:

Of which: USD 16552.25 7.1586 118490.94

VND 391343099.00 0.0003 107324.27

MMK 1000000.00 0.0034 3408.86

Short-term loans:

Of which: USD 99674705.04 7.1586 713531343.50

VND 204185120522.92 0.0003 55996945.71

Long-term borrowings

Of which: USD

EUR

HKD

135Lu Thai Textile Co. Ltd. Interim Report 2025

(2) Notes to overseas entities including: For significant oversea entities main operating place recording

currency and selection basis shall be disclosed; if there are changes in recording currency relevant

reasons shall be disclosed.□ Applicable □ Not applicable

The operating places of the Company’s overseas subsidiaries were Hong Kong Burma America Vietnam Singapore and

Cambodia and the recording currency was HKD for Hong Kong and USD for other overseas companies.

63. Lease

(1) The Company was Lessee

□ Applicable □ Not applicable

Variable lease payments that are not covered in the measurement of the lease liabilities

□ Applicable □ Not applicable

Simplified short-term lease or lease expense for low-value assets

□ Applicable □ Not applicable

Item Amount for the Current Period

Expense relating to short-term leases 182064.45

Low-value lease expenses

Variable lease payments that are not covered in the

measurement of the lease liabilities

Total 182064.45

(2) The Company was Lessor

Operating leases with the Company as lessor

□ Applicable □ Not applicable

Unit: RMB

Of which: Income related to variable

Item Rental income lease payments not included in lease

receipts

Rental income 1775586.40

Total 1775586.40

Finance leases with the Company as lessor

□ Applicable □ Not applicable

Undiscounted lease receipts for each of the next five years

□ Applicable □ Not applicable

Unit: RMB

Undiscounted lease receipts per year

Item

Ending amount Beginning amount

The first year 869241.80 1240588.20

136Lu Thai Textile Co. Ltd. Interim Report 2025

The second year 162441.30 426120.60

The third year 20160.00

Total undiscounted lease receipts after

1031683.101686868.80

five years - -

(3) Recognition of Gain or Loss on Sales Under Finance Leases with the Company as a Manufacturer or

Distributor

□ Applicable □ Not applicable

VIII Research and Development Expenditure

Unit: RMB

Item Amount for the Current Period H1 2024

Labor cost 56204005.76 63810510.13

Material expense 26511331.44 32672913.93

Depreciation charges 8622551.12 9704000.88

Others 9108731.66 9187172.25

Total 100446619.98 115374597.19

Of which: Expensed research and

100446619.98115374597.19

development expenditure

IX Change of Consolidation Scope

1. Disposal of Subsidiary

Whether there were any transactions or events during the period in which control of the subsidiary was lost

□ Yes □ No

Whether there was a step-by-step disposal of investment in a subsidiary through multiple transactions and loss of control during

the Current Period

□ Yes □ No

2. Other Reasons for Changes of Consolidation Scope

Notes of other changes in the combination scope (e.g. new subsidiaries liquidation of subsidiaries etc.) and relevant situations:

There were no changes in the consolidation scope of the Company during the Reporting Period.X Equity in Other Entities

1. Equity in Subsidiary

(1) Compositions of the Group

Unit: RMB

Name Registered capital Main Regist Nature of Shareholding Way of

137Lu Thai Textile Co. Ltd. Interim Report 2025

operatin ration business percentage (%) gaining

g place place

Indirectl

Directly

Lu Thai (Hong Kong) Textile Wholesale

Hong Hong

Co. Ltd. (hereinafter referred 128771800.00 and retail 100.00% Incorporated

Kong Kong

to as “Lu Thai (HK)”) industry

Shanghai Lu Thai Textile

Wholesale

Garment Co. Ltd. Shangha Shang

20000000.00 and retail 100.00% Incorporated

(hereinafter referred to as i hai

industry

“Shanghai Lu Thai”)

LuFeng Company Limited

Manufacturi

(hereinafter referred to as 706160000.00 Zibo Zibo 75.00% Incorporated

ng industry

“LuFeng Company”)

Zibo Luqun Textile Co. Ltd.Manufacturi

(hereinafter referred to as 168220000.00 Zibo Zibo 100.00% Incorporated

ng industry

“Luqun Textile”)

Zibo Xinsheng Thermal Business

Thermoelect

Power Co. Ltd. (hereinafter combination

162435600.00 Zibo Zibo ric 100.00%referred to as “Xinsheng not under thecogenerationThermal Power”) same control

Shandong Lulian New

Materials Co. Ltd. Manufacturi 156547

900000000.00 Zibo Zibo 75.00% Incorporated

(hereinafter referred to as ng industry 46.93

“Lulian New Materials”)

Shandong Lujia Import &

Export Co. Ltd. (hereinafter Import and

10000000.00 Zibo Zibo 100.00% Incorporatedreferred to as “Lujia Import export trade& Export”)

Beijing Zhishu Management

Consulting Co. Ltd. Beijin Management

2000000.00 Beijing 100.00% Incorporated

(hereinafter referred to as g consulting

“Zhishu Consulting”)

Lu Thai Occupational

Training School Zichuan

District Zibo City 100000.00 Zibo Zibo Skill training 100.00% Incorporated(hereinafter referred to as “LuThai Training”)

Zibo Banyang Villa Hotel

Catering

Co. Ltd. (hereinafter referred 5000000.00 Zibo Zibo 100.00% Incorporated

services

to as “Banyang Villa”)

Hainan Huilin International Modern

Wencha WencHoldings Co. Ltd. (“Huilin 880000000.00 service 100.00% Incorporatedng hangInternational”) industry

Wholesale

textiles and

Singapo Singap

TP Company 398203876.00 leather 100.00% Incorporated

re ore

holding

company

Vanguard Apparel Co. Ltd.Manufacturi

(hereinafter referred to as 62337887.93 Burma Burma 100.00% Incorporated

ng industry

“Vanguard Apparel”)

Lu Thai (USA) Textile Co. Wholesale

Ameri

Ltd. (hereinafter referred to 6139710.00 America and retail 100.00% Incorporated

as “Lu Thai (USA)”) industry

Tianyi Apparel Co. Ltd. Manufacturi

10719000.00 Burma Burma 100.00% Incorporated

(hereinafter referred to as ng industry

138Lu Thai Textile Co. Ltd. Interim Report 2025

“Tianyi Apparel”)

Yuanhui Dividend No. 2

Private Securities Investment 100.00% Subscribe

Fund (“Yuanhui Fund”)

Basis of controlling significant structural entities incorporated in the scope of combination:

The structural entity incorporated in the scope of consolidation of the Group is Yuanhui Dividend No. 2 Private Securities

Investment Fund. The Group assesses its share of investment holdings the power it enjoys and variable returns comprehensively

and includes the structural entity that the Company has control power into the consolidation scope.

(2) Significant Non-wholly-owned Subsidiary

Unit: RMB

Shareholding The profit or loss Declaring dividends Equity of non-

Name proportion of non- attributable to the non- distributed to non- controlling interests at

controlling interests controlling interests controlling interests the end of the period

LuFeng Company 15654746.93 7742581.19 75000000.00 315582036.11

(3) The Main Financial Information of Significant Non-wholly-owned Subsidiary

Unit: RMB

Ending balance Beginning balance

Curren Non- Curren Non-

Name Non- Total Non- TotalCurren Total t current Curren Total t current

current liabiliti current liabiliti

t assets assets liabiliti liabilit t assets assets liabiliti liabilit

assets es assets es

es y es y

LuFen

11365711617073906949352440041096648231745156225039320661

219954225.384175269.121.47390.938635124.173754247.232.07479.

Compa

1.87627.49005452.35196.5467067

Unit: RMB

Amount for the Current Period H1 2024

Total Cash flows Total Cash flows

Name Operating comprehen from Operating comprehen from

Net profit Net profit

revenue sive operating revenue sive operating

income activities income activities

LuFeng 49336029 28443221. 28381052. 64274869 43872724. 43890298. 13110972

55574848.

Company 3.18 22 29 2.32 61 36 0.07

2. Equity in Joint Ventures or Associated Enterprises

(1) Significant Joint Ventures or Associated Enterprises

Shareholding percentage (%) Accounting

Name of joint treatment of the

ventures or Main operating Registration Nature of investment to

associated place place business Directly Indirectly joint venture or

enterprises associated

enterprise

139Lu Thai Textile Co. Ltd. Interim Report 2025

Haohong Equity

Ningbo Ningbo 33.33% Equity method

Investment investment

Haoying Equity

Ningbo Ningbo 47.62% Equity method

Investment investment

(2) Main Financial Information of Significant Associated Enterprises

Unit: RMB

Beginning balance/the same period of last

Ending balance/reporting period

year

Haohong Haoying

Haohong Investment Haoying Investment

Investment Investment

Current assets 59855543.31 193171974.67 97221745.84 193217687.26

Non-current assets

Total assets 59855543.31 193171974.67 97221745.84 193217687.26

Current liabilities 3253866.05 3253866.05

Non-current liability

Total liabilities 3253866.05 3253866.05

Net assets 56601677.26 193171974.67 93967879.79 193217687.26

Equity of non-controlling

interests

Equity attributable to

shareholders of the parent 56601677.26 193171974.67 93967879.79 193217687.26

company

Net assets shares calculated at the

18870148.6191988494.3431325690.5892010262.67

shareholding proportion

Adjusted items

- Goodwill

- Internal unrealized profit

- Others -3247328.29 -3251681.96

Carrying value of investment to

18870148.6188741166.0531325690.5888758580.71

associated enterprises

Fair value of equity investments

in associated enterprises with

publicly quoted prices

Operating revenue

Net profit 4233797.47 -45712.59 -50801107.48 -17117805.92

Net profit from discontinued

operations

Other comprehensive income

Total comprehensive income 4233797.47 -45712.59 -50801107.48 -17117805.92

Dividends received from the

associated enterprises in the

Current Period

140Lu Thai Textile Co. Ltd. Interim Report 2025

XI Government Grants

1. Government Grants Recognized at the End of the Reporting Period at the Amount Receivable

□ Applicable □ Not applicable

Reasons for failing to receive government grants in the estimated amount at the estimated point in time

□ Applicable □ Not applicable

2. Liability Items Involving Government Grants

□ Applicable □ Not applicable

3. Government Grants Recognized in Profit or Loss for the Current Period

□ Applicable □ Not applicable

Unit: RMB

Accounting items Amount for the Current Period H1 2024

Other income 11191654.96 14929113.83

Financial expenses 126500.01 84024.92

Total 11318154.97 15013138.75

XII Risks Associated with Financial Instruments

1. Various Types of Risks Arising from Financial Instruments

The Company’s major financial instruments include monetary capital notes receivable accounts receivable receivables financing

other receivables held-for-trading financial assets other non-current financial assets other non-current assets - term deposits over

one year accounts payable other payables short-term loans current portion of non-current liabilities other current liabilities -

endorsed outstanding notes long-term borrowings bonds payable lease liabilities and other equity instruments. Details of various

financial instruments are disclosed in relevant Notes. Risks related to these financial instruments and risk management policies

the Company has adopted to reduce these risks are described as follows. The Company management manages and monitors the

risk exposure to ensure the above risks are controlled in a limited scope.

1. Risk management objectives and policies

The Company has conducted the risk management to achieve an appropriate balance between the risk and the income and to

minimize the adverse influence of financial risks on the Company’s financial performance. According to such risk management

objective the Company has formulated corresponding risk management policy to recognize and analyze possible risks

encountered by the Company set the appropriate acceptable risk level and designed corresponding internal control procedures to

monitor the Company’s risk level. Meanwhile the Company will regularly review these risk management policies and relevant

internal control system so as to cater for the market or respond to any change in the Company’s business operations. Accordingly

the Company’s internal audit department will also regularly or randomly check whether the internal control system is implemented

in conformity with relevant risk management policies.The major risks caused by financial instruments of the Company are credit risk liquidity risk and market risk (including foreign

exchange risk and interest rate risk).The Board of Directors shall be responsible for planning and establishing the risk management framework for the Company

determining the Company’s risk management policies and relevant guidelines and monitoring the implementation of various risk

141Lu Thai Textile Co. Ltd. Interim Report 2025

management measures. However the Company has established corresponding risk management policies to recognize and analyze

possible risks encountered by the Company. Besides various risks are specified in these risk management policies including the

credit risk the liquidity risk and the market risk management etc. On a regular basis the Company will evaluate the specific

marketing environment and various changes in the Company’s business operations so as to determine whether any risk

management policy and system need be updated.

(1) Credit Risk

Credit risk means that the Company will suffer any financial losses due to the counterparty’s failure in fulfilling the contract

obligations.The Company shall manage the credit risk based on the specific Group Classification and the credit risk mainly arises from bank

deposit notes receivable accounts receivable other receivables and debt investment etc.The Company’s bank deposits are mainly saved in state-owned banks and other large and medium-sized listed banks. The

Company’s bank deposits are expected not to suffer any major credit risks.For notes receivable accounts receivable other accounts receivable and long-term receivables the Company has established

relevant policies to control the credit risk exposure. According to the client’s financial status credit record and other factors

(including the current market condition) the Company will evaluate the client’s credit qualification and set corresponding credit

period. The Company regularly monitors the credit records of customers. For customers with bad credit records the Company

adopted corresponding methods such as written pressing for payment shortening credit period and canceling credit period so as

to ensure the Company’s overall credit risk is controllable.The hugest credit risk exposure borne by the Company is the book value of each financial asset reflected in the balance sheet.In terms of accounts receivable the top 5 customers in accounts receivable were accounted for 24.82% of the total amount of

accounts receivable of the Company (22.16% in 2024). As for other receivables the top 5 of the ending balance according to the

arrears party was accounted for 63.32% of the total amount of other receivables of the Company (69.61% in 2024).Debt investment

The Company generally limits its exposure to credit risk by investing only in securities for which there is an active market (other

than long-term strategic investments) and for which the counterpart has a high credit rating.The Company supervised the changes of credit risk through tracking the published external credit ratings. In order to make sure

whether the credit rating was the latest and whether the credit risk has increased obviously of evaluation report date but not been

reflected in the published external ratings the Company has supplemented through examining the changes of bond yield and the

available news and supervision information.On the balance sheet date the carrying value of investment in debt obligations of the Company are listed as follows according to

report items. (Unit: RMB’0000)

Ending balance Closing balance of lastyear

Held-for-trading financial

assets 62068.16 23087.41

Debt investment due within

one year 15629.74 15417.66

Total 77697.90 38505.07

(2) Liquidity Risk

Liquidity risk refers to the risk of capital shortage encountered by the Company during the cash payment or the settlement of other

financial assets.During the management of liquidity risk the Company shall reserve and monitor corresponding cash and cash equivalent deemed

sufficient by the management so as to meet the Company’s operational requirements and mitigate the impact caused by the cash

flow fluctuation. The Company’s management will monitor the use of bank loans and guarantee the fulfillment of loan agreement.

142Lu Thai Textile Co. Ltd. Interim Report 2025

Meanwhile major financial institutions shall promise to provide the Company with sufficient reserve funds in order to satisfy the

short-term and long-term fund demand. The Company shall raise its working capital based on the capital generated from business

operations and bank loans.At the end of the period the analysis of financial liabilities and off-balance sheet guarantee items held by the Company based on

the maturity period of the undiscounted remaining contractual cash flows is as follows:

Ending balance

Item

Within one year Within one to five years Over five years Total

Financial liabilities:

Short-term loans 777348854.17 777348854.17

Accounts payable 174248558.77 174248558.77

Other payables 19703690.74 19703690.74

Long-term

borrowings 20819399.04 412514989.55 433334388.59

Bonds payable 1399841200.00 1399841200.00

Lease liabilities 19353237.59 52861448.08 47878562.82 120093248.49

Total 2411314940.31 465376437.63 47878562.82 2924569940.76

At the end of the previous year the analysis of financial liabilities and off-balance sheet guarantee items held by the Company

based on the maturity period of the undiscounted remaining contractual cash flows is as follows:

Closing balance of last year

Item

Within one year Within one to five years Over five years Total

Financial liabilities:

Short-term loans 855549333.86 855549333.86

Accounts payable 272079091.51 272079091.51

Other payables 17437799.60 17437799.60

Long-term

borrowings 21948346.33 405344416.41 427292762.74

Bonds payable 1399844700.00 1399844700.00

Lease liabilities 20183287.07 58411429.64 54533430.61 133128147.33

Total 1187197858.37 1863600546.05 54533430.61 3105331835.04

The amounts of financial liabilities disclosed in the table above represent undiscounted contractual cash flows and may differ from

the carrying amounts in the balance sheet.

(3) Market Risk

The financial instrument’s market risk refers to the fluctuation risk of fair value of financial instrument or future cash flow caused

by the changes of market price including the interest rate risk and the exchange rate risk.Interest rate risk

Interest rate risk refers to the risk of fluctuations in the fair value or future cash flows of financial instruments arising from changes

in market interest rates. The interest rate can derive from the recognized interest-bearing financial instruments and unrecognized

financial instruments (including certain loan commitment).The Company’s interest rate risk mainly arises from the long-term interest-bearing debt such as the bank loan and bonds payable.Financial liabilities based on the floating interest rate will cause the cash flow interest rate risk to the Company and financial

143Lu Thai Textile Co. Ltd. Interim Report 2025

liabilities based on the fixed interest rate the fair value interest rate risk.However the Company has paid close attention the impact of interest rate fluctuations on the Company’s interest rate risk. At

present the Company has not taken any interest rate hedging measures. The rise of interest rate will increase the cost of newly-

added interest-bearing debts and the interest cost of the Company’s unsettled interest-bearing debts based on the floating interest

rate and cause major adverse influence on the Company’s financial performance. The management will timely make

corresponding adjustment according to the latest market situation and corresponding interest rate swap will be arranged to reduce

the interest rate risk.The interest-bearing financial instruments held by the Company are as follows (Unit: RMB’0000):

Item Amount of Current Amount of the PreviousPeriod Period

Fixed-interest financial instruments

Including: Short-term loans 76952.83 70968.68

Long-term borrowings matured within one

year 425.00

Long-term borrowings

Bonds payable 151126.83 150942.04

Total 228079.65 222335.73

Floating-interest financial instruments

Financial assets 62068.16 38505.07

Including: Held-for-trading financial assets 62068.16 23087.41

Debt investment due within one year 15629.74 15417.66

Financial liabilities 40815.46 40467.05

Including: Short-term loans

Long-term borrowings matured within one

year 1242.64 842.64

Long-term borrowings 39572.82 39624.41

Total 102883.62 78972.12

On June 30 2025 if the lending rate calculated at floating interest rate up or down 100 basis points with other variables unchanged

the net profit and shareholders’ equity will be decreased or increased about RMB3469300 (compared to RMB3439700 as at the

end of last year).For financial instruments held at the balance sheet date that expose the Company to fair value interest rate risk the impact on net

profit and shareholders’ equity in the sensitivity analysis above is the impact of re-measuring the above financial instruments at the

new interest rate assuming that there is a change in interest rates at the balance sheet date. For floating rate non-derivative

instruments held at the balance sheet date that expose the Company to cash flow interest rate risk the impact on net profit and

shareholders’ equity in the above sensitivity analysis is the impact of changes in the above interest rates on interest expense or

income estimated on an annualized basis. The previous year’s analysis was based on the same assumptions and methodology.Foreign exchange risk

Foreign exchange risk is referred to the fluctuation risk of fair value of financial instruments or future cash flows resulted from the

change of foreign exchange rate. The foreign exchange rate was originated from the financial instruments denominated in foreign

currencies other than the recording currency.The Company’s recognized foreign currency assets and liabilities as well as future foreign currency transactions (the denomination

currencies of foreign currency assets and liabilities and foreign currency transactions are mainly USD VND EUR and HKD) are

144Lu Thai Textile Co. Ltd. Interim Report 2025

exposed to foreign exchange risk.On June 30 2025 the amount of foreign currency financial assets and foreign currency financial liabilities converted to renminbi

is as follows (Unit: RMB’0000):

Foreign currency liabilities Foreign currency assets

Item

Ending balance Closing balance of last year Ending balance Closing balance of last year

USD 76805.14 73605.67 182952.01 178017.80

EUR 22.90 18.79 344.61 412.75

JPY 15.46 14.91 68.84 14.43

HKD 176.90 100.84

GBP 0.03 0.02

VND 6425.67 7442.45 6897.27 6964.15

MMK 46.79 224.19 1625.84 710.25

KHR 124.77 96.76

Total 83315.96 81306.01 192190.27 186317.00

The Company has paid close attention the impact of exchange rate fluctuations on the Company’s exchange rate risk. The

Company has signed contracts of futures exchange for the purpose of the aversion of foreign exchange risk. As at the end of each

reporting period for the Company’s monetary capitals notes receivable accounts payable other payables short-term loans and

long-term loans denominated in foreign currencies assuming a 10% appreciation or depreciation of RMB against foreign

currencies while other factors remain unchanged the impact of possible reasonable changes in the Company’s foreign currency

exchange rate against RMB on the Company’s profit and loss for the Current Period is as follows (Unit: RMB’0000):

This year Last year

Exchange rate

fluctuations

Impact on after-tax profit Impact on shareholders’ equity Impact on after-tax profit Impact on shareholders’equity

10% appreciation

against RMB -8467.99 -8467.99 -5706.30 -5706.30

10% depreciation

against RMB 8467.99 8467.99 5706.30 5706.30

2. Capital Management

The objectives of capital management policies of the Company are to ensure the continuous operation of the Company so as to

provide return to shareholders and benefit other stakeholders as well as to reduce capital cost by maintaining the optimal capital

structure.In order to maintain or adjust capital structure the Company might adjust financing method and the dividends paid to shareholders

return capital to shareholders issue new shares and other equity instruments or sell assets to reduce debts.The Company supervised the capital structure based on the asset-liability ratio (namely total liabilities divide total assets). On June

30 2025 the asset-liability ratio was 27.76% of the Company (29.49% on December 31 2024).

XIII Disclosure of Fair Value

1. Ending Fair Value of Assets and Liabilities at Fair Value

Unit: RMB

Item Closing fair value

145Lu Thai Textile Co. Ltd. Interim Report 2025

Fair value Fair value Fair value

measurement items at measurement items at measurement items at Total

level 1 level 2 level 3

I. Consistent fair value

--------

measurement

i. Held-for-trading

187230880.00862120278.381049351158.38

financial assets

1. Financial assets at

fair value through 187230880.00 862120278.38 1049351158.38

profit or loss

(1) Investment in debt

150171000.00470510575.78620681575.78

instruments

(2) Equity investments 37059880.00 391609702.60 428669582.60

ii. Accounts receivable

37499801.2037499801.20

financing

iii. Other non-current

82800000.0082800000.00

financial assets

The total amount of

assets consistently 187230880.00 862120278.38 120299801.20 1169650959.58

measured at fair value

vi. Held-for-trading

836220.67836220.67

financial liabilities

Derivative financial

836220.67836220.67

liabilities

The total amount of

liabilities consistently 836220.67 836220.67

measured at fair value

II. Inconsistent fair

--------

value measurement

2. Market Price Recognition Basis for Consistent and Inconsistent Fair Value Measurement Items at

Level 1

Quoted prices in active markets for identical assets or liabilities (unadjusted).

3. Valuation Technique Adopted and Nature and Amount Determination of Important Parameters for

Consistent and Inconsistent Fair Value Measurement Items at Level 2

The Company determines the fair value of structural deposits and wealth management products based on the prospective earning

rate as agreed in the contract.The Company determines the fair value of fund products based on the changes in net value published by the private equity funds.The Company determines the fair value of forward options based on bank forward foreign exchange quotations at the end of the

period.

4. Valuation Technique Adopted and Nature and Amount Determination of Important Parameters for

Consistent and Inconsistent Fair Value Measurement Items at Level 3

For the unlisted equity investment the Company adopts the comparable listed company comparison method and the non-

observable input value of the comparable listed company comparison method includes the liquidity discount.

146Lu Thai Textile Co. Ltd. Interim Report 2025

The investment into Shandong Hongqiao Thermoelectric Co. Ltd. made by Luqun Textile (the Company’s subsidiary) is expected

to be held in the long run for obtaining the discount on power purchase. As no revenue distribution right is vested in the

investment the invested unit’s operating profit and loss are not shared or borne and the equity transfer is not proposed the

Company regards it as the financial asset which shall be measured based on the fair value through profit or loss and the

investment cost is deemed as the fair value of the financial asset.For accounts receivables financing at fair value and the changes included in other comprehensive income its fair value shall be

determined by the discount cash flow method.

5. Fair Value of Financial Assets and Financial Liabilities Not Measured at Fair Value

The financial assets and financial liabilities measured at amortized cost mainly include monetary capitals notes receivable

accounts receivable other receivables short-term loans notes payable accounts payables other payables current portion of long-

term borrowings long-term borrowings and bonds payable.XIV Related Party and Related-party Transactions

1. Information Related to the Company as the Parent Company

Proportion of voting

Proportion of share

rights owned by the

Registration held by the parent

Name Nature of business Registered capital parent company

place company against the

against the

Company (%)

Textile chemistry and

Lucheng Textile Zibo RMB63260000 17.17% 17.17%

investment

Notes: Information on the parent company

The final controllers of the Company are Mr. Liu Zibin and Mr. Liu Deming.

2. Subsidiaries of the Company

Refer to Note X-1.

3. Information on the Joint Ventures and Associated Enterprises of the Company

Refer to Note X-2.

4. Information on Other Related Parties

Relationship with the

Name

Company

Zibo Limin Purified Water Co. Ltd. (hereinafter referred to as “Limin Purified Water”) Same parent company

Zibo Luqun Land Co. Ltd. (hereinafter referred to as “Luqun Land”) Same parent company

Zibo Lurui Fine Chemical Co. Ltd. (hereinafter referred to as “Lurui Chemical”) Same parent company

Zibo Lujia Property Management Co. Ltd. (hereinafter referred to as “Lujia Property”) Same parent companyHong Kong Tung Hoi International Company Limited (hereinafter referred to as “Tung HoiSame parent companyInternational”)

Zibo Chengshun Hosiery Co. Ltd. (hereinafter referred to as “Chengshun Hosiery”) Same parent company

147Lu Thai Textile Co. Ltd. Interim Report 2025Zibo Chengshun Economic and Trade Co. Ltd. (hereinafter referred to as “ChengshunSame parent companyEconomic and Trade”)Chengshun Petrochemical (Zhejiang Zhoushan) Co. Ltd. (hereinafter referred to as “ChengshunSame parent companyPetrochemical”)Zibo Lucheng Petrochemical Sales Co. Ltd. (hereinafter referred to as “LuchengSame parent companyPetrochemical”)

Shanghai Hengjiu Textile New Materials Co. Ltd. (hereinafter referred to as “Hengjiu Textile”) Same parent company

Subsidiary of the parent

Shandong Xirui New Materials Co. Ltd. (hereinafter referred to as the “Xirui New Material”)

company’s subsidiaryZibo Lumei Economic and Trade Co. Ltd. (hereinafter referred to as “Lumei Economic andSame parent companyTrade”)Zibo Hesheng Chemical Trading Co. Ltd. (hereinafter referred to as “Hesheng Chemical Subsidiary of the parentTrading”) company’s subsidiaryZhiFeng (Vietnam) International Trading Co. Ltd. (hereinafter referred to as “ZhiFeng Subsidiary of the parentInternational”) company’s subsidiary

Liu Zibin Xu Zhinan Xu Jianlv Zheng Huisheng Liu Deming Zhang Zhanqi Zhang Keming

Du Lixin Zhu Beina Yu Mingtao Quan Yuhua Wei Jian Shang Chenggang Yu Shouzheng Key management personnel

Liu Zilong Dong Shibing Guo Heng Lv Wenquan Xu Feng Zheng Weiyin

5. List of Related-party Transactions

(1) Information on Acquisition of Goods and Reception of Labor Service

Information on acquisition of goods and reception of labor service

Unit: RMB

Whether

Amount for the Current The approval trade exceed