Contents

Part 1: Report Preface

I. Compilation Standards

1.1 Declaration of Objectivity of Report Content

1.2 Scope of Report Organization

1.3 Time Range of Report

1.4 Report Release Cycle

1.5 Report Data Description

II. General Manager's Letter

III. Company Profile

Part 2: Report Main Body

I. Enterprise Quality Philosophy

II. Internal Quality Management

2.1 Quality Management Organization

2.2 Quality Management System

2.3 Quality Risk Management

III. Enterprise Quality Integrity

3.1 Quality Integrity Management

3.2 Quality Culture Construction

IV. Enterprise Quality Foundation

4.1 Enterprise Product Standards

4.2 Enterprise Metrology Level

4.3 Certification and Accreditation Status

4.4 Quality Inspection Status

V. Product Quality Responsibility

5.1 Product Quality Level

5.2 Product After-Sales Responsibility

5.3 Corporate Social Responsibility

5.4 Quality Credit Record

Part 3: Conclusion

Part 1: Report Preface

I. Compilation Standards

1.1 Declaration of Objectivity of Report Content:

The company has always adhered to the quality policy of "Quality First, Technological Innovation; Diligence and Governance, Loyalty to Customers; Striving for Excellence, Achieving Success", operates legally, adheres to a professional and industry-specific development approach, takes technological innovation as its foundation, continuously increases investment in new product R&D, always keeps up with customer needs, and prioritizes customer satisfaction and quality. The compilation of the 2021 Enterprise Quality Credit Report aims to solicit opinions from all sectors of society, accept supervision, and improve work.

1.2 Scope of Report Organization: Jiangsu Antarctic Machinery Co., Ltd.

1.3 Time Range of Report

January 1, 2021 to December 31, 2021. To maintain the coherence and readability of the report, some content extends beyond the above time range.

1.4 Report Release Cycle This report is an annual report.

1.5 Report Data Description The data in this report comes from internal company statistics.

II. General Manager's Letter

Since its establishment in 1968, Antarctic has adhered to the corporate spirit of "Unity, Struggle, Pragmatism, and Innovation", focusing on the research, development, manufacturing, and service of ship anti-pollution products and shaft and rudder systems. It has taken on the responsibility of building a national brand, and has followed a solid and persistent path of development, becoming a professional and international industry leader and main force.

Quality is the lifeblood of the enterprise, and we must adhere to the principle of quality first. This is the core concept and principle of all the company's management work; technology is the primary productive force. Only by continuously carrying out technological innovation and improvements in product quality, and continuously developing new products and technologies with market prospects and potential, can we improve the core competitiveness of the company's products; management produces efficiency. The company must continuously strengthen and improve its internal production management, quality management, and business management systems, and use advanced management methods to improve the company's overall management level, enabling the company's management to reach a new height; continuous improvement of product quality and providing customers with high-quality products and services is an eternal goal of the company, and it is also necessary for the company's survival and development; the company undertakes the task of undertaking key naval projects and equipment, and must prioritize national defense construction, researching and producing high-tech, high-quality, and applicable equipment to meet the needs of the military and make the "Antarctic" contribution to national defense construction.

III. Company Profile

Jiangsu Antarctic Machinery Co., Ltd. is a private military-industrial enterprise. Its predecessor, Taixing Ship Machinery Factory, was founded in 1968 and has a history of 50 years of development. It is a key high-tech enterprise of the National Torch Plan, a national science and technology innovation demonstration enterprise, a national advanced enterprise in mechanical industry management, a national advanced unit in corporate culture, a Jiangsu provincial high-tech enterprise, a key enterprise in the Jiangsu provincial shipbuilding supporting industry, and a key backbone enterprise in Taixing City. The company was originally located in Taixing City's Dasheng Industrial Park. In 2013, it acquired more than 200 mu of land in the Taixing City High-tech Industrial Park, invested 700 million yuan, including 300 million yuan in equipment, and built a modern research and production base for military and ship anti-pollution equipment. Six modern production standard factories, two administrative and technological buildings have been built, and the company has now moved to its new location. The company currently occupies a total area of 250,000 square meters in two locations, with a building area of 150,000 square meters. It has more than 450 sets of various production equipment, including more than 230 sets of large and high-precision equipment, with total assets of 400 million yuan. The company has a total of 350 employees, including 102 professional and technical personnel, including 6 senior professionals, 28 intermediate professionals, and 68 junior professionals. The company has strong technical strength, advanced production equipment, and complete testing instruments. Sufficient resources enable the company to have the ability to research, develop, produce, and ensure the quality of its military and civilian products. The company's products have not only been used in the Great Wall Station, Zhongshan Station in Antarctica, and national key projects and ships such as Xiangyanghong No. 10, Polar No. 1, and Yuanwang No. 1 survey ships, but have also been exported to more than ten countries and regions including Russia, Ukraine, Germany, Japan, Thailand, Norway, Singapore, and Taiwan. The quality and performance of the products enjoy a high reputation among users.

The company's ballast water management system won the gold award in the first "Military-Civil Integration Competition" in 2016. Four types of products, including sewage treatment devices and medical modules, are national high-tech products. The WCMBR series of sewage treatment devices have obtained USCG, EC certificates from the European Community, and IMO international certificates. The company has passed ISO9001 military and civilian dual quality system certification and weapon equipment manufacturer qualification review, and has obtained the confidentiality qualification certification certificate and weapon equipment scientific research and production license issued by the State Administration of Science, Technology and Industry for National Defense. For more than ten years, the company has been continuously rated as a national advanced enterprise in environmental protection science and technology and a top 100 environmental protection enterprise, and has been continuously rated as a "AAA"-level enterprise, and has won the title of "Contract-Honoring and Credit-Keeping" enterprise in Jiangsu Province.

In 1997, the company passed the military and civilian product quality assurance system certification of China New Era Certification Center, and is the only enterprise in the region to obtain certification from this certification center. Through years of certification activities, it has promoted the continuous improvement of the company's quality management capabilities, the steady improvement of product quality, and the continuous enhancement of customer satisfaction. In order to further improve product quality, meet customer needs, and enhance customer satisfaction, the company has established a documented quality management system in accordance with GB/T19001-2016 and GJB9001C-2017 "Quality Management Systems—Requirements". This Quality Manual is the quality activity standard that must be followed by all departments and employees of the company.

Company Address: No. 118, Wenchang East Road, Chengdong High-tech Industrial Park, Taixing City, Jiangsu Province

Postal Code: 225400 Company Website: njnj@jsnj.com

Legal Representative: Ni Jianfeng

Part 2: Report Main Body

I. Enterprise Quality Philosophy

Company Mission: To create value for customers, happiness for employees, returns for shareholders, and well-being for society.

Core Values: Loyalty to the mission, courage to take responsibility, integrity-based, excellence and strength

Vision: To become a global leader in ship anti-pollution equipment!

Corporate Spirit: Unity, diligence, exploration, innovation; openness, inclusiveness, sustainability, and leadership.

Company Commitment: Continuously focusing on customer requirements and enhancing customer satisfaction. Continuously carrying out technological innovation and improvement of product quality, continuously developing new products and technologies with market prospects and potential, and improving the core competitiveness of the company's products; through continuous strengthening and improvement of internal production management, quality management, and operation management systems, improving the company's overall management level through advanced management methods, and promoting the company's management to a new level; continuously improving product quality, providing customers with high-quality products and services is an eternal goal of the company,

II. Internal Quality Management

2.1 Quality Management Organization

The highest management level of the company is the general manager, the deputy general manager of technology is the management representative, and the management representative exercises the power of quality management. The company's quality management department is the quality control center, which is responsible for the specific matters of the company's quality management, including the achievement of quality goals, system certification and effective operation, product quality inspection, quality information processing, customer complaint handling, etc.; the personnel are full-time quality management personnel, responsible for the company's quality work.

2.2 Quality Management System

Quality Policy: Quality first, technological innovation; striving for excellence, loyal customers; striving for the peak, establishing meritorious service.

Quality Objectives: Finished product first-time inspection pass rate ≥98.5%; military product first-time delivery pass rate ≥98%; develop no less than 2 new products every year; quality loss rate ≤3.5‰; comprehensive customer satisfaction 97%, no major customer complaints.

The company passed the China New Era Certification military and civilian quality management system certification in 1997, and passed the GB/T19001-2016 and GJB9001C quality management system recertification in 2018, establishing a sound quality management system, clarifying the responsibilities and powers of leaders at all levels, using advanced management concepts and scientific management systems, and forming effective management systems. In accordance with the requirements of the system, the company has compiled quality system documents such as "Quality Manual", "Procedure Documents", and "Third-Level Documents", and earnestly implemented them in the work. According to the requirements of the system documents, various departments cooperate closely and strictly control the design quality, the quality of incoming materials, the control of the production process, and the quality of outgoing products, so that quality management has laws to follow, rules to follow, and evidence to check, and quality management is complete and controllable.

2.3 Quality Risk Management

——Quality Complaint Handling.

The company has a comprehensive support department that is specifically responsible for the after-sales service of all products, providing customers with debugging, consultation, complaint, and maintenance services. After receiving customer complaints, the company guarantees to respond within 8 hours and arrive at the scene within 24 hours for after-sales service at domestic ports. Find the cause of the problem as quickly as possible, and continuously improve methods to enhance customer satisfaction.

——Quality Risk Monitoring.

From the beginning of the entry of raw materials, 100% inspection and testing of incoming materials are carried out to ensure that 100% of the raw materials are qualified for warehousing; quality control points are set up in the production workshop to grasp the quality information of products in each process in a timely manner, eliminating unqualified products in the bud; the quality control points of handover inspection do a good job in the sampling inspection of product batches to prevent unqualified batches of products from entering the warehouse, and the reasons for unqualified batches are statistically analyzed every month to urge the workshop to take corrective and preventive measures. From the company's management to all employees, they participate and act consciously, identify risks, and effectively control them.

——Emergency Management In order to improve the company's ability to respond to sudden major quality accidents and customer complaints, ensure that in the event of major and particularly serious accidents, command is highly smooth, personnel, equipment, and materials are in place in a timely manner, protect the lives, environment, and property safety of employees, and minimize accidents, according to the "Safety Production Law" combined with the actual situation of the company, formulate accident emergency plans. The company regularly organizes employees to conduct drills to ensure that in the event of a sudden incident, the emergency plan can be activated to avoid risks and reduce hazards.

III. Enterprise Quality Integrity

3.1 Quality Integrity Management The company has formulated the "Quality Integrity Management System", clarifying the responsibilities of quality integrity work, enhancing the integrity and credit concept of company employees, standardizing the company's credit management work, improving the company's credit awareness and credit management level, strengthening self-discipline, standardizing order, creating a market environment of honest operation and fair competition, promoting the sustainable development of the company, enhancing the company's comprehensive competitiveness, and protecting the legitimate rights and interests of users and enterprises.

3.2 Quality Culture Construction

Quality documents are part of corporate culture. In terms of quality culture construction, in addition to doing a good job in quality brand building, improving innovation capabilities, and improving core competitiveness, the company also attaches great importance to the cultivation of employees' quality awareness. By frequently carrying out quality management activities, improving the enthusiasm of all employees to participate in quality management, and enhancing quality awareness; using knowledge lectures, on-the-job training, and external training, training all employees, promoting the concept of honest operation to employees through training, enhancing employees' quality awareness, standardizing employee operations, and ensuring the smooth progress of quality management work; summarizing quality information from market, after-sales, engineering, production, and procurement departments every month, and holding monthly quality analysis meetings to analyze the reasons for quality information and corrective and preventive measures one by one, and distribute the relevant implementation documents to the responsible departments, set the responsible person and completion time, and every matter must be closed on time. Quality accidents are strictly implemented in accordance with the company's quality assessment rules, forming an atmosphere where every employee cares about quality and actively improves quality.

IV. Enterprise Quality Foundation

4.1 Enterprise Product Standards

The company's research institute has a standardization studio that is specifically responsible for the company's standardization management-related work. The company actively adopts advanced international and domestic standards, participates in the drafting and revision of relevant national and industry standards, and has compiled enterprise standards for some products and released them externally.

4.2 Enterprise Metrology Level

The company has obtained the "Metrology Assurance Confirmation Certificate", certificate number: 2020 Measurement and Recognition Enterprise (Su) Word (50039), valid until May 19, 2025. The company strictly follows the requirements of the metrology management system and GB/T19001-2016, unifies the management of all metrology equipment, and regularly inspects and calibrates it to ensure that the metrology equipment used on site is used within the effective metrology time and its status meets the standards.

4.3 Certification and Accreditation Status

The company has obtained the GB/T19001-2016 quality management system certificate from the China New Era Certification Center, certificate number: 00820Q30038R7M, valid until May 4, 2023; the company is a qualified supplier of the China Nuclear Group, and has passed the qualified supplier review of the China Xingyuan Certification Center, certificate number CNNC-200045000, certificate valid until July 9, 2023; the company has obtained intellectual property management system certification, certificate number 201111181, two-integration management system assessment, and Jiangsu Provincial Enterprise Credit Management Standard Certification, certificate number 2012-3212-00434.

4.4 Quality Inspection Status

The company implements a three-level inspection system for products, namely self-inspection, mutual inspection, and special inspection. Procurement inspection is carried out by full-time inspectors from the quality control center, process products are self-inspected and mutually inspected by operators, and then inspected and qualified by full-time inspectors before process transfer. The final products are inspected and qualified by authorized full-time inspectors before being reviewed by the company's general inspection to ensure that there are checks at every level and unqualified products are prevented from flowing out.

V. Product Quality Responsibility

5.1 Product Quality Level

The company's product quality is in the upper-middle range within the same industry. Major clients are large and medium-sized state-owned shipyards and ship owners. Products have received consistent praise from users and have been repeatedly commended by major shipyards of CSSC (China State Shipbuilding Corporation) and other users.

5.2 Product After-Sales Responsibility

The company has a dedicated after-sales service team with service outlets in Guangzhou, Shanghai, Dalian, Qingdao, Fujian, and Zhoushan. A "Product After-Sales Service Management System" has been established, promising customers in coastal areas 24-hour service arrival at the designated location. A full lifecycle service is provided for products. The company has also established a dedicated emergency response mechanism and a regular customer feedback mechanism for after-sales service to ensure timely collection of customer feedback and provide efficient and high-quality after-sales service.

5.3 Corporate Social Responsibility

The company actively participates in charitable causes and supports Party building activities and rural construction activities. In recent years, to create a happy enterprise, the annual expenditure on 20 good deeds for employees and society has exceeded 2 million yuan, with additional public welfare and charitable expenditures exceeding 1.2 million yuan. While striving to create economic benefits for the enterprise, the company also remembers to give back to society, constantly pursuing high-performance corporate social responsibility, and actively supporting public welfare undertakings and scientific, educational, cultural, and health undertakings.

5.4 Quality Credit Record

Since its establishment 53 years ago, the company has never been penalized or reported for product quality issues, and has no other negative records of quality credit.

Part 3: Conclusion

With the mission of "creating value for customers," the company has established a customer-centric corporate culture, striving to meet customer needs. The company focuses on brand building, providing customers with good products and after-sales service, retaining customers with product quality and service, and relying on the radiation and diffusion effect of the brand to cultivate customer groups and consolidate market share. Customer satisfaction and loyalty have shown a year-on-year upward trend. All Nanjiren people take the corporate vision of "Building a global leader in ship anti-pollution equipment!" as their responsibility and strive to build a century-old enterprise!