On this occasion of bidding farewell to the old and welcoming the new, on behalf of the board of directors and management, I would like to pay high tribute to all the employees at home and abroad. I would also like to express my heartfelt thanks to the global customers, partners and friends from all circles who have been caring and supporting the development of ShangGong Group and extend my New Year's greetings.

2020 is an extremely extraordinary year. In the face of the sudden global Covid-19 epidemic, the global manufacturing industry has inevitably been greatly challenged. As a representative Shanghai manufacturing company that has gone abroad to implement international operations, ShangGong actively fulfills the social responsibilities of listed companies, gives full play to its own advantages, and uses its capabilities in sewing, welding processes and automation control technology to provide equipment support for anti-epidemic materials such as masks, protective clothing and filter bags, and made due contributions in anti-epidemic prevention and resumption of work and production. After the outbreak of the epidemic at the beginning of the year, ShangGong Richpeace quickly developed a variety of automatic mask machines through strong automation equipment design capabilities, and continued to provide automatic mask production lines (equipment) to domestic and foreign markets; when the domestic epidemic was most tense, Shensy Logistics fully mobilized its trunk-line transportation resources to deliver various anti-epidemic materials for epidemic-stricken areas, pharmaceutical companies and anti-epidemic companies; when medical supplies such as protective clothing from countries around the world were in urgent need, PFAFF Industrial actively organized overtime to produce Hot air and ultrasonic welding machine. All the employees of the company united as one and made concerted efforts to contribute their strength to the epidemic prevention and anti-epidemic of the whole society. At the same time, according to the management measures of "cost reduction and efficiency increase, cash is king, precise research and development, opportunity-seeking investment" formulated by the Group, the enterprises have overcome the great difficulties caused by the global epidemic crisis, and made efforts to improve the economic benefits of the company, and achieved commendable achievements.  

In 2021, with the global economic recovery in the post-epidemic period, the manufacturing industry is bound to see the growth of market recovery demand. As China continues to improve the top-level design of the overall plan for the development of the industrial Internet, Made in China is transforming from "the world's factory" to "a major country in intelligent manufacturing and intelligent services." The company is also looking for innovative strategies to cope with the challenges of global value chain competition and upgrade the value chain. On the one hand, we continue to take customer demand as the guide and actively innovate the production mode of sewing equipment by means of information technology such as the Internet of Things, big data and artificial intelligence, and comprehensively improve the level of product design, manufacturing and management by promoting the digitization and intelligence of sewing process and equipment. On the other hand, we actively explore to increase the value of products by adding service elements, namely "sewing service".

Facing the historic new opportunities of transformation and development in the new era, ShangGong proposed a mid-to-long-term development strategy of "advancing into comprehensive digitalization". Over the years, the group has acquired a number of well-known brands in the German sewing industry. Relying on Germany's advanced foundation in the global industry 4.0, the company has taken the lead in forming the first-mover advantage of "digital sewing equipment" in the industry. In the future, the company will take this as the core, extend the industrial chain vertically through investment and financing, and actively promote the commercial application of the industrial Internet in the sewing-related industries. The company will also form a new structure of “three-in-one” with the three major business segments of “intelligent manufacturing equipment, industrial sewing equipment and household sewing machines”, and realize the new manufacturing industrial revolution of digitization, intelligence and networking and provide solutions for automobile, aerospace, environmental protection, new energy and other emerging industries and innovative technologies for traditional industries such as clothing, luggage, home textiles, and furniture, and fully promote the "ShangGong Smart Manufacture" brand.

2021 is the first year of the "14th Five-Year Plan", and we will face new market opportunities and challenges. Let us join hands, work together to achieve a comprehensive optimization of the operating structure, and be invincible in the future globalization journey. I wish you all good health, smooth work and happy family in the new year!

Chairman and President of ShangGong Group

Zhang Min

January 1, 2021