(Incorporated in the Cayman Islands with limited liability) （於開曼群島註冊成立之有限公司） NOTIFICATION LETTER 通 知 信 函 Dear Non-registered Shareholder (Note 1) , 29 September 2025 The following document(s) of China Water Industry Group Limited (the "Company") has/have been prepared in English and Chinese and is/are available on the websites of the Company at http://www.chinawaterind.com and The Stock Exchange of Hong Kong Limited at http://www.hkexnews.hk (collectively the "Websites"):- • Interim Report 2025 Please provi ...

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Financial Performance - Revenue for the six months ended June 30, 2025, was HKD 118,051, a decrease of 62.65% compared to HKD 316,051 in 2024[11] - Gross profit dropped to HKD 1,669, down 97.08% from HKD 57,139 in the previous year[11] - The company reported a loss of HKD 64,740 for the period, which is a 16.25% improvement from a loss of HKD 77,301 in 2024[11] - EBITDA for the six months was HKD 20,310, reflecting a decrease of 55.50% from HKD 45,640 in the same period last year[11] - Basic and diluted loss per share improved to HKD (11.31) from HKD (27.43), a reduction of 58.77%[11] - The company reported a pre-tax loss of HKD 64,876,000 for the six months ended June 30, 2025, compared to a pre-tax loss of HKD 73,700,000 for the same period in 2024[39] - The company reported a loss attributable to shareholders of HKD 59,616,000 for the six months ended June 30, 2025, compared to a loss of HKD 78,821,000 for the same period in 2024, representing a 24.4% improvement[54] - The net loss for the first half of 2025 was approximately HKD 64.7 million, an improvement from a net loss of HKD 77.3 million in the first half of 2024, representing a reduction of 16.7%[108] Assets and Liabilities - Total assets as of June 30, 2025, were HKD 2,276,103, a slight decrease of 1.86% from HKD 2,319,171 at the end of 2024[11] - Total liabilities decreased by 7.75% to HKD 1,166,118 from HKD 1,264,139[11] - The company's equity attributable to owners increased by 7.71% to HKD 857,553 from HKD 796,204[11] - The company reported a total equity of HKD 1,109,985,000 as of June 30, 2025, compared to HKD 1,055,032,000 at the end of 2024, indicating an increase of approximately 5.2%[21] - The total assets less current liabilities stood at HKD 1,484,030,000, down from HKD 1,516,910,000, indicating a decline of approximately 2.2%[21] - The group’s total liabilities as of June 30, 2025, were HKD 372,847,000, a decrease from HKD 385,749,000 as of December 31, 2024[64] - The group’s total liabilities decreased by HKD 98,020,000 to HKD 1,166,120,000, primarily due to the repayment of bank and other borrowings during the interim period[149] Cash Flow and Operating Activities - The net cash generated from operating activities for the six months ended June 30, 2025, was HKD 2,427,000, a significant decrease from HKD 17,500,000 in the same period of 2024[27] - Cash and cash equivalents were HKD 44,795, a minor decrease of 0.80% from HKD 45,156[11] - The cash and cash equivalents balance as of June 30, 2025, was HKD 42,535,000, down from HKD 77,541,000 a year earlier, reflecting a decrease of about 45%[27] - The group recorded cash and cash equivalents of HKD 44,800,000, a slight decrease from HKD 45,160,000 as of December 31, 2024[121] Revenue Breakdown - Revenue from wastewater treatment services was HKD 27,927,000, down 40% from HKD 46,437,000 in the previous year[33] - Revenue from electricity sales decreased to HKD 53,401,000, a decline of 41.4% from HKD 91,001,000 in the prior year[33] - The segment profit for wastewater treatment and related construction services was HKD 7,578,000, while the total segment loss was HKD 42,936,000 for the reporting period[39] - The company recorded revenue of HKD 58,560,000 and a gross loss of HKD 16,860,000 in the renewable energy development and sales segment for the first half of 2025, a decrease of HKD 41,720,000 in revenue compared to the same period in 2024[165] - Revenue from the glass management contract was HKD 20.72 million, up from HKD 18.01 million, while the food waste contract generated HKD 10.78 million, an increase from HKD 5.85 million[175] Employee and Operational Changes - Employee costs, including directors' remuneration, totaled HKD 31,881,000 for the six months ended June 30, 2025, down from HKD 85,306,000 in the previous year, reflecting a decrease of approximately 62.6%[52] - The company reported a significant reduction in the number of full-time employees from 739 in June 2024 to 369 in June 2025, primarily due to the closure of several landfills and the sale of Yichun Water Group[114] - The group had 369 employees as of June 30, 2025, a decrease from 739 employees on June 30, 2024[195] Legal and Compliance Issues - The company has initiated legal actions in mainland China to recover the outstanding loan balance, as the borrower's main assets are located in Guangdong Province[68] - The company has submitted an arbitration notice to the Hong Kong International Arbitration Centre to initiate arbitration proceedings against the borrower and enforce the guarantees under the supplementary loan agreement[70] - The company has initiated legal proceedings to recover debts from Yunnan Chao Yue Gas, but no significant progress has been made[76] - The ongoing legal disputes have resulted in significant financial implications for the company, including full impairment of receivables[72] Strategic Initiatives and Market Expansion - The company is actively pursuing legal remedies to recover outstanding debts from both Da Xin and Yunnan Chao Yue Gas[72][76] - The group is focusing on overseas market expansion, particularly in Southeast Asia, leveraging its investment platform to accelerate key projects in Indonesia and explore new opportunities[197] - The group aims to establish a development pattern of "local deep cultivation + overseas radiation" by participating in regional projects as an intermediary service provider[200] - The company has entered into memorandums of understanding with local governments in Indonesia for potential cooperation on landfill management and gas-to-energy projects, marking significant overseas market expansion[186]

Summary of Key Points Core Viewpoint - As of September 17, 163 stocks reached their 52-week highs, indicating a positive trend in the market, with notable performances from companies like Aux International, China Water Industry Group, and Xixiang Group [1]. Stock Performance Highlights - Aux International (02080) achieved a closing price of 0.530 with a peak of 0.680, marking a high rate of 65.85% [1]. - China Water Industry Group (01129) closed at 0.940, reaching a high of 1.280, resulting in a 43.82% increase [1]. - Xixiang Group (02473) had a closing price of 10.550 and a peak of 13.340, reflecting a 35.43% rise [1]. Additional Notable Stocks - Other stocks that reached significant highs include: - Bitland (00897) with a 27.50% increase [1]. - China Science Education Industry (01756) at 27.03% [1]. - WMCH Global (08208) with a 20.00% rise [1]. Market Trends - The overall trend shows a strong performance in various sectors, with many companies experiencing substantial growth in their stock prices, indicating investor confidence and market recovery [1][2].

Core Viewpoint - China Water Industry Group (01129) has seen a significant stock price increase, with a month-to-date rise exceeding 260% and a current increase of 15.91% to HKD 1.02 per share, with a trading volume of HKD 11.5179 million [1] Group 1 - The company has experienced a stock price and trading volume surge as of September 15, 2025, but the board is unaware of any reasons for this fluctuation [1] - The board confirmed that there is no information that needs to be disclosed to prevent the company's securities from appearing in a false market, nor any insider information that must be disclosed under the Securities and Futures Ordinance [1] - The company's business operations remain normal, and there have been no significant changes in its business operations and financial condition as of the announcement date [1] Group 2 - The company is currently in discussions with an independent third party regarding a potential memorandum of understanding for the acquisition of a company engaged in design and development of intellectual property, application services, and related training courses in the People's Republic of China [1] - As of the announcement date, discussions are ongoing, and no agreement has been reached regarding the terms and conditions of the potential memorandum of understanding [1]

Core Viewpoint - China Water Affairs Group (01129) has seen a significant stock price increase, with a rise of over 37% in intraday trading and a cumulative increase of over 260% within the month [1] Stock Performance - As of the report, the stock price is up 15.91%, trading at 1.02 HKD, with a transaction volume of 11.5179 million HKD [1] Company Announcement - The company’s board is aware of the stock price and trading volume increase as of September 15, 2025, but has not identified any reasons for the fluctuations [1] - The board confirmed that there is no information that needs to be disclosed to prevent the creation of a false market for the company's securities [1] Business Operations - The company’s business operations are reported to be normal, with no significant changes in business operations or financial status as of the announcement date [1] Potential Acquisition - The company is in discussions with an independent third party regarding a potential memorandum of understanding for the acquisition of a company engaged in design, development of intellectual property, application services, and related training courses in the People's Republic of China [1] - As of the announcement date, discussions are ongoing, and no agreement has been reached regarding the terms and conditions of the potential memorandum [1]

Group 1 - China Water Industry Group (01129) shares surged over 25%, reaching an increase of 28.99% to HKD 0.89, with a trading volume of HKD 5.734 million [1] - On September 15, China Water Industry Group announced that it is in discussions with an independent third party regarding a potential memorandum of understanding (MOU) for the acquisition of a company engaged in design, development of intellectual property, application services, and related training courses in the People's Republic of China [1] - As of the date of the announcement, discussions are ongoing, and no terms or conditions for the potential MOU have been finalized, nor has any agreement been reached regarding the MOU [1]

Core Viewpoint - China Water Affairs Group (01129) experienced a significant stock price increase of over 25%, reaching a rise of 28.99% to HKD 0.89, with a trading volume of HKD 5.734 million [1] Group 1 - On September 15, China Water Affairs Group announced that it is in discussions with an independent third party regarding a potential memorandum of understanding (MOU) [1] - The potential MOU involves the acquisition of a company primarily engaged in the design and development of intellectual property, providing application services, and offering related training courses within the People's Republic of China [1] - As of the date of the announcement, discussions are ongoing, and no terms or conditions for the potential MOU have been finalized, nor has any agreement been reached [1]

Core Viewpoint - China Water Industry Group (01129) announced that its share price and trading volume increased on September 15, 2025, but the board is unaware of any reasons for this fluctuation and confirms that the business operations remain normal [1][1][1] Group 1 - The board has confirmed that there is no information that needs to be disclosed to prevent the company's securities from appearing in a false market [1][1] - The group is currently in discussions with an independent third party regarding a potential memorandum of understanding for the acquisition of a company in China that focuses on intellectual property design and development, application services, and related training courses [1][1][1] - As of the date of the announcement, discussions are ongoing, and no agreement has been reached regarding the terms and conditions of the potential memorandum of understanding [1][1]

Core Viewpoint - China Water Affairs Group (01129) announced that its share price and trading volume increased on September 15, 2025, but the board is unaware of any reasons for this fluctuation and confirms that business operations remain normal [1] Group 1 - The board has conducted reasonable inquiries regarding the company's share price and trading volume fluctuations and found no undisclosed information that could mislead the market [1] - The company is currently in discussions with an independent third party regarding a potential memorandum of understanding for the acquisition of a company in China that focuses on intellectual property design and development, application services, and related training courses [1] - As of the date of the announcement, negotiations are ongoing, and no agreement has been reached regarding the terms and conditions of the potential memorandum of understanding [1]