Meihu Co., Ltd. terminates the 150 million yuan North American production base project, shifting strategic focus to the Thailand facility.

（April 1, 2026, Changsha）Hunan Meihù Zhìzào Co., Ltd. (Securities Code: 603319, short name: “Meihù Shares”) today issued an announcement stating that the company’s board of directors has approved a resolution to terminate the North America Mexico production base project. The project originally planned an investment of RMB 150 million; as of now, the actual投入 is RMB 21.62 million. The company said it will actively dispose of relevant assets and expects the overall loss to be relatively small.

Project Overview and Reasons for Termination

Meihù Shares passed board and shareholder resolutions on July 29, 2024 and August 14, 2024 respectively, approving an investment of RMB 150 million to build a North America Mexico production base. In the same year, in August, the company acquired 99% equity interest in HOP Intech NA, S. de R.L. de C.V. for 100 pesos (about RMB 40) as the project implementation entity, and has already carried out preliminary work such as leasing factory space and purchasing equipment and raw materials.

The announcement states that the termination of the investment is mainly based on two reasons: first, the current North American environment is complex and changeable, and continuing to invest carries substantial uncertainty and risk; second, the company has adjusted its strategic focus to building the Thailand production base. After careful study, the company believes that the feasibility and necessity of the original invested project have undergone substantive changes.

Decision Process and Financial Impact

On March 31, 2026, the 11th session of Meihù Shares’ board of directors held the 25th meeting, at which the termination resolution was approved, authorizing the chairman of the board or an authorized representative to handle subsequent related procedures. Pursuant to the provisions of the “Shanghai Stock Exchange Stock Listing Rules” and the “Articles of Association,” this termination investment does not constitute a related-party transaction or a major asset reorganization, and therefore does not require submission for consideration by the shareholders’ meeting.

As of now, the project’s actual investment totals RMB 21.62 million (unaudited), mainly used for leasing factory space, purchasing equipment, and procuring raw materials. The company said it will actively dispose of the corresponding assets to recoup funds and expects the overall loss to be relatively small, without causing a material impact on the company’s performance, nor any circumstance that would harm shareholders’ interests.

Strategic Adjustment Analysis

Terminating the North America project is an important initiative by Meihù Shares to optimize resource allocation and focus on its core strategy. The company will shift its strategic focus to the construction of the Thailand production base, which may be based on factors such as a more favorable cost structure in Southeast Asia, a more stable policy environment, and broader market potential. Market analysts believe that this adjustment will help the company concentrate resources to enhance its core competitiveness and better respond to changes in the global market.

Meihù Shares emphasized that terminating the North America project will not have an adverse impact on the company’s business development. The company will continue to advance its established development strategy and improve overall operating efficiency and market competitiveness.

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