Planet Green Holdings Corp.

Condensed Consolidated Balance Sheets

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit)

For the Three Months Ended March 31, 2026 and 2025

Unaudited Condensed Consolidated Statements of Cash Flows

PLANET GREEN HOLDINGS CORP.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND 2025

1. Organization and Principal Activities

Planet Green Holdings Corp. (the “Company” or “PLAG”) is a holding company incorporated in Nevada. We are engaged in various businesses through our subsidiaries in China and Canada.

On May 9, 2019, the Company issued an aggregate of 1,080,000 shares of Planet Green Holdings Corporation’s common stock to the BoZhuang Shareholders, in exchange for BoZhuang Shareholders’ agreement to enter into VIE Agreements (the “BoZhuang VIE Agreements”). On August 1, 2021, the VIE agreements with Xianning Bozhuang Tea Products Co., Ltd. was terminated and the company acquired 100% equity of Xianning Bozhuang Tea Products Co., Ltd. for restructuring purposes.

On August 12, 2019, through Lucky Sky HK, the Company established Lucky Sky Petrochemical, a wholly foreign-owned enterprise incorporated in Xianning City, Hubei Province, China. On December 9, 2020, Lucky Sky Petrochemical Technology (Xianning) Co., Ltd. changed its name to Jiayi Technologies (Xianning) Co., Ltd. (“Jiayi Technologies”)

On May 29, 2020, Promising Prospect BVI Limited incorporated Lucky Sky Planet Green Holdings Co., Limited, a limited liability company incorporated in Hong Kong.

On June 5, 2020, Promising Prospect BVI Limited acquired all of the outstanding equity interests of Fast Approach Inc. Fast Approach was incorporated under Canada’s laws and provides digital advertising delivery and operational services, with China and North America serving as its two core markets.

On June 16, 2020, Lucky Sky Holdings Corporations (H.K.) transferred its 100% equity interest in Lucky Sky Petrochemical to Lucky Sky Planet Green Holdings Co., Limited (H.K.).

On January 6, 2021, Planet Green Holdings Corporation (Nevada) issued an aggregate of 2,200,000 shares of common stock of the Company to the equity holders of Jingshan Sanhe Luckysky New Energy Technologies Co., Ltd. in exchange for the transfer of 85% of the equity interest of Jingshan Sanhe Luckysky New Energy Technologies Co., Ltd to the Jiayi Technologies (Xianning) Co., Ltd. For restructuring purposes, on September 1, 2021, the VIE agreements with Jingshan Sanhe were terminated and Hubei Bulaisi Technology Co., Ltd. acquired the shares of Jingshan Sanhe. On September 14, 2022, Planet Green Holdings Corp. and Hubei Bulaisi Technology Co., Ltd. a subsidiary of the Company, entered into a Share Purchase Agreement with Xue Wang, a shareholder of Jingshan Sanhe Luckysky New Energy Technologies Co., Ltd., pursuant to which, among other things and subject to the terms and conditions contained therein, the Purchaser agreed to effect share purchase from the Seller of 15% of the outstanding equity interests of Jingshan, and the Company shall pay to the Seller an aggregate of U.S. $3,000,000 in exchange for 15% of the issued and outstanding shares. On September 14, 2022, the Company closed the Share Purchase transaction. As a result, Hubei Bulaisi Technology Co., Ltd. owned 100% shares of Jingshan Sanhe Luckysky New Energy Technologies Co., Ltd.

On December 9, 2021, Planet Green Holdings Corporation (Nevada) issued an aggregate of 5,900,000 shares of common stock to the equity holders of Shandong Yunchu Supply Chain Co., Ltd. (“Shandong Yunchu”) for the transfer to 100% of the equity interest of Shandong Yunchu to the Jiayi Technologies (Xianning) Co., Ltd. For the best interest of the Company, on April 30, 2025, the Board resolved to discontinue the operation of Shandong Yunchu. Subsequently, on September 1, 2025, the Company disposed of its 100% equity interest in Promising Prospect HK Limited (“Promising HK”) for nominal consideration. Promising HK holds the 100% equity interest in Shandong Yunchu through Jiayi Technologies and does not own any other operating assets of the Company. The disposal of Promising HK, Shandong Yunchu and Jiayi Technologies resulted in loss from disposal of approximately $9.2 million.

On April 8, 2022, Planet Green Holdings Corporation (Nevada) issued an aggregate of 7,500,000 shares of common stock to the equity holders of Allinyson Ltd. for the acquisition of 100% of the equity interest of Allinyson Ltd., including its wholly-owned subsidiary Baokuan Technology (Hongkong) Limited. On April 1, 2024, Allinyson Ltd. and its subsidiaries have been completely disposed, resulting in gain from disposal of $355,517.

On November 26, 2025, Bozhuang entered into a Share Purchase Agreements with shareholders of Hubei Shengsili Biotechnology Co., Ltd. (“Hubei Shengsili”), to acquire 67% equity interests in Hubei Shengsili for a consideration of $145, resulting in goodwill of $7,101. The nominal consideration reflects the strategic nature of the acquisition, as the Company acquired Hubei Shengsili primarily for its operational platform and distribution network in the biotechnology sector, rather than for its existing net asset value.

On December 16, 2025, the Company incorporated PinnacleTech HK Limited (“PinnacleTech HK”), a limited liability company incorporated in Hong Kong.

On December 24, 2025, through PinnacleTech HK, the Company incorporated Hubei Lingpu Zhenghe Technology Co., Ltd. (“Hubei Lingpu”)in Xianning City, Hubei Province, China. Hubei Lingpu is a wholly foreign-owned enterprise, formerly known as Dingfeng Biotechnology Xiangning Co., Ltd. prior to its name change on April 29, 2026.

On March 10, 2026, the Company incorporated Hubei Taihe Biotechnology Co., Ltd. (“Hubei Taihe”), a PRC limited liability company.

On March 19, 2026, the Company incorporated Yunnan Cuishanji Biotechnology Co., Ltd. (“Yunnan Cuishanji”), a PRC limited liability company.

On March 24, 2026, the Company incorporated Xianning Huarui Trading Co., Ltd. (“Xianning Huarui”), a PRC limited liability company.

On March 27, 2026, Yunnan Cuishanji acquired 51% equity interests in Yunnan Yinuowei Biotechnology Co., Ltd. (“Yunnan Yinuowei”) for a consideration of $5,397, resulting in goodwill of $8,228. The goodwill arising from this acquisition exceeded the consideration paid, as the fair value of Yunnan Yinuowei’s identifiable net assets at the acquisition date was negative, primarily due to liabilities assumed in excess of assets acquired.

Enterprise-Wide Disclosure

The Company’s chief operating decision-makers (i.e. chief executive officer and her direct reports) review financial information presented on a consolidated basis, accompanied by disaggregated information about revenues by business lines for purposes of allocating resources and evaluating financial performance. There are no segment managers who are held accountable for operations, operating results and plans for levels or components below the consolidated unit level. Based on qualitative and quantitative criteria established by Accounting Standards Codification (“ASC”) 280, “Segment Reporting”, the Company considers itself to be operating withinone reportable segment.

Liquidity and Going Concern

The accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern; The Company reported net income of $502,855 for the three months ended March 31, 2026 and it’s the net cash provided by operating activities for the three months ended March 31, 2026 was $4,580,433. However, the Company had an accumulated deficit of $174,717,437 and a working capital deficit of $4,897,804 as of March 31, 2026.

These factors raise substantial doubt on the Company’s ability to continue as a going concern. The accompanying unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Company has recently expanded its sales and marketing efforts by engaging sales agents to promote its tea products and enhance market penetration. The Company believes this sales agent model enables it to improve its profit and cash flow. Management’s plan for the Company’s continued existence is dependent upon management’s ability to execute the business plan and generate additional profit. Additionally, Management may need to continue to rely on private placements or other financing transactions or certain related parties to provide funding for investment, for working capital and general corporate purposes. If management is unable to execute its plan, the Company may become insolvent.

2. Summary of Significant Accounting Policies

Basis of Presentation

Management has prepared the accompanying unaudited condensed consolidated financial statements and these notes according to generally accepted accounting principles in the United States (“GAAP”).

Principles of Consolidation

Details of the Subsidiaries of the Company as of March 31, 2026 are set below:

Management has eliminated all significant inter-company balances and transactions in preparing the accompanying unaudited condensed consolidated financial statements.

Reclassifications

Certain amounts on the prior years’ consolidated balance sheets and statement of operations were reclassified to reflect discontinued operations, with no effect on ending stockholders’ equity.

Use of Estimates

The unaudited condensed consolidated financial statements preparation requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements, and the reported amounts of revenues and expenses during the reporting periods. Management evaluates estimates, including the allowance for credit losses of accounts receivable, amounts due from related parties and equity investments, the useful lives of our property and equipment, impairment of long-lived assets, long-term investments and goodwill, etc. Management bases the estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from these estimates.

Cash

Cash includes currency on hand and deposits held by banks that can be added or withdrawn without limitation. The Company maintains most of its bank accounts in the PRC. Cash maintained in banks within the People’s Republic of China of less than RMB 0.5 million (equivalent to $72,485) per bank are covered by “deposit insurance regulation” promulgated by the State Council of the People’s Republic of China.

Accounts Receivable, Net

Accounts receivables are recognized and carried at the original invoice amount less allowance for any uncollectible amounts. An estimate for doubtful accounts is made when the amount is not expected to be collected. Delinquent amount balances are written off against the allowance for doubtful amounts after the management has determined that the likelihood of collection is not probable.

Inventories, Net

Inventories consist of raw materials and finished goods, stated at the lower of cost or market value. Finished goods are comprised of direct materials, direct labor, inbound shipping costs, and allocated overhead. An annual impairment test will be performed on inventory, and any excess of the recoverable amount over the carrying amount will be recognized as impairment losses in the current period.

Advances to Suppliers, Net

The Company makes advance payments to suppliers and vendors for the procurement of raw materials. Upon physical receipt and inspection of the raw materials from suppliers, the applicable amount is reclassified from advances and prepayments to suppliers to inventory. The Company reviews its advance to suppliers on a periodic basis and makes general and specific allowances when there is doubt as to the ability of a supplier to provide supplies to the Company or refund an advance.

Plant and Equipment

Plant and equipment are carried at cost less accumulated depreciation. Depreciation is provided over their estimated useful lives, using the straight-line method. The Company typically applies a salvage value of 0% to 5%. The estimated useful lives of the plant and equipment are as follows:

The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts, and any gain or loss is included in the Company’s results of operations. The costs of maintenance and repairs are recognized as incurred; significant renewals and betterments are capitalized.

Intangible Assets

Intangible assets are carried at cost less accumulated amortization. Amortization is provided over their useful lives, using the straight-line method. The estimated useful lives of the intangible assets are as follows:

Goodwill

Goodwill represents the excess of the purchase price over the fair value of the net identifiable assets acquired in a business combination. The Company conducts an annual assessment of its goodwill for impairment. If the carrying value of its goodwill exceeds its fair value, then impairment has been incurred; accordingly, a charge to the Company’s operations results will be recognized during the period. Impairment losses on goodwill are not reversed. Fair value is generally determined using a discounted expected future cash flow analysis.

Impairment of Long-lived Assets

The Company annually reviews its long-lived assets for impairment or whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. Impairment may become obsolete from a difference in the industry, introduction of new technologies, or if the Company has inadequate working capital to utilize the long-lived assets to generate adequate profits. Impairment is present if the carrying amount of an asset is less than its expected future undiscounted cash flows.

If an asset is considered impaired, a loss is recognized based on the amount by which the carrying amount exceeds the fair market value of the asset. Assets to be disposed of are reported lower the carrying amount or fair value fewer costs to selling.

During the year ended December 31, 2025, the Company identified indicators of impairment related to a production line and related long-lived assets due primarily to the prolonged suspension of production and reduced utilization of the related assets. The Company intends to continue operating and utilizing these assets and, accordingly, evaluated the related asset group for impairment as held-and-used long-lived assets under ASC 360.

As the carrying amount of the asset group was not expected to be recoverable, the Company measured the impairment loss as the amount by which the carrying value of the asset group exceeded its estimated fair value. The fair value measurement was based primarily on valuation techniques including the cost approach and, where applicable, market information for similar used equipment. Significant inputs included replacement cost, physical deterioration, functional and economic obsolescence, and asset condition and utilization.

As a result, the Company recognized an impairment charge of $132,127 and $130,330 as of March 31, 2026 and December 31, 2025, respectively. The fair value measurement of the asset group was classified within Level 3 of the fair value hierarchy and was measured on a nonrecurring basis.

Statutory Reserves

Statutory reserves refer to the amount appropriated from the net income following laws or regulations, which can be used to recover losses and increase capital, as approved, and are to be used to expand production or operations. PRC laws prescribe that an enterprise operating at a profit must appropriate and reserve, on an annual basis, an amount equal to 10% of its profit. Such an appropriation is necessary until the reserve reaches a maximum equal to 50% of the enterprise’s PRC registered capital.

Foreign Currency Translation

The accompanying unaudited condensed consolidated financial statements are presented in United States dollars. The functional currency of the Company is the Renminbi (RMB). The Company’s assets and liabilities are translated into United States dollars from RMB at period-end exchange rates. Its revenues and expenses are translated at the average exchange rate during the period. Capital accounts are translated at their historical exchange rates when the capital transactions occurred.

The RMB is not freely convertible into foreign currencies, and all foreign exchange transactions must be conducted through authorized financial institutions.

Revenue Recognition

The Company adopted ASC 606 “Revenue Recognition.” It recognizes revenue when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.

The Company derives its revenues from manufacture and distribution of fuel additives, alcohol based fuel, diesel fuel and tea products, as well as providing online advertising services. The Company recognizes product revenue at a point in time when the control of the products or services has been transferred to customers. The Company applies the following five steps to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:

Cost of revenue

Cost of revenue consists primarily of the costs of finished goods manufactured and procurement cost of packaging, freight charges, depreciation of property and machinery and warehousing expenses. Cost of revenue also includes incremental costs of obtaining sales contract, which are mainly promotion cost paid to distributors in the amount in-line with sales revenue realized.

Advertising

All advertising costs are expensed as incurred.

Shipping and Handling

All outbound shipping and handling costs are expensed as incurred.

Research and Development

All research and development costs are expensed as incurred.

Retirement Benefits

Retirement benefits in the form of mandatory government-sponsored defined contribution plans are charged to either expense as incurred or allocated to inventory as part of overhead.

Income Taxes

The Company accounts for income tax using an asset and liability approach and recognizes deferred tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not, these items will either expire before the Company can realize their benefits or uncertain future realization.

Comprehensive Income

The Company uses Financial Accounting Standards Board (“FASB”) ASC Topic 220, “Reporting Comprehensive Income.” Comprehensive income is comprised of net income and all changes to the statements of stockholders’ equity, except the changes in paid-in capital and distributions to stockholders due to investments by stockholders.

Earnings Per Share

The Company computes earnings per share (“EPS”) following ASC Topic 260, “Earnings per share.” Basic EPS is measured as the income or loss available to common shareholders divided by the weighted average common shares outstanding for the period. Diluted EPS presents the dilutive effect on a per-share basis from the potential conversion of convertible securities or the exercise of options and or warrants; the dilutive impacts of potentially convertible securities are calculated using the as-if method; the potentially dilutive effect of options or warranties are computed using the treasury stock method. Potentially anti-dilutive securities (i.e., those that increase income per share or decrease loss per share) are excluded from diluted EPS calculation.

Fair Value Measurements of Financial Instruments

The Company’s financial instruments, including cash and equivalents, accounts and other receivables, accounts and other payables, accrued liabilities, and short-term debt, have carrying amounts that approximate their fair values due to their short maturities. ASC Topic 820, “Fair Value Measurements and Disclosures,” requires disclosing the Company’s fair value of financial instruments. ASC Topic 825, “Financial Instruments,” defines fair value and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The carrying amounts reported in the consolidated balance sheets for receivables and current liabilities qualify as financial instruments and are a reasonable estimate of their fair values because of the short period between the origination of such instruments and their expected realization and their current market rate of interest. The three levels of valuation hierarchy are defined as follows:

Lease

Effective December 31, 2018, the Company adopted ASU 2016-02, “Leases” (Topic 842), and elected the practical expedients that do not require us to reassess: (1) whether any expired or existing contracts are, or contain, leases, (2) lease classification for any expired or existing leases and (3) initial direct costs for any expired or existing leases. For lease terms oftwelve months or fewer, a lessee is permitted to make an accounting policy election not to recognize lease assets and liabilities. The Company also adopted the practical expedient that allows lessees to treat the lease and non-lease components of a lease as a single lease component.

Lease terms used to calculate the present value of lease payments generally do not include any options to extend, renew, or terminate the lease, as the Company does not have reasonable certainty at lease inception that these options will be exercised. The Company generally considers the economic life of its operating lease ROU assets to be comparable to the useful life of similar owned assets. The Company has elected the short-term lease exception, therefore operating lease ROU assets and liabilities do not include leases with a lease term of twelve months or less. Its leases generally do not provide a residual guarantee. The operating lease ROU asset also excludes lease incentives. Lease expense is recognized on a straight-line basis over the lease term.

The Company reviews the impairment of its ROU assets consistent with the approach applied for its other long-lived assets. The Company reviews the recoverability of its long-lived assets when events or changes in circumstances occur that indicate that the carrying value of the asset may not be recoverable. The assessment of possible impairment is based on its ability to recover the carrying value of the asset from the expected undiscounted future pre-tax cash flows of the related operations. The Company has elected to include the carrying amount of operating lease liabilities in any tested asset group and it includes the associated operating lease payments in the undiscounted future pre-tax cash flows.

As of March 31, 2026, the company does not have any current lease agreements exceeding 12 months.

Share-based Compensation

The Company recognize share-based compensation expense on a straight-line basis over the applicable requisite service period, based on the grand date fair value of the award. The fair value of shares issued for services is calculated by multiplying the number of shares issued with the stock price on the grant date.

Commitments and Contingencies

From time to time, the Company is a party to various legal actions arising in the ordinary course of business. The majority of these claims and proceedings related to or arise from commercial disputes. The Company first determines whether a loss from a claim is probable, and if it is reasonable to estimate the potential loss. The Company accrues costs associated with these matters when they become probable, and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. Also, the Company discloses a range of possible losses, if a loss from a claim is probable but the amount of loss cannot be reasonably estimated, which is in line with the applicable requirements of Accounting Standard Codification 450. The Company’s management does not expect any liability from the disposition of such claims and litigation individually or in the aggregate would have a material adverse impact on the Company’s consolidated financial position, results of operations and cash flows.

Recent Accounting Pronouncements

In March 2025, the FASB issued ASU 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity. The amendments in this Update require an entity involved in an acquisition transaction effected primarily by exchanging equity interests when the legal acquiree is a VIE that meets the definition of a business to consider the factors in paragraphs 805-10-55-12 through 55-15 to determine which entity is the accounting acquirer. The amendments in this Update are effective for all entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. The Company is currently in the process of evaluating the impact this amended guidance may have on its consolidated financial statements.

In April 2025, the FASB issued ASU 2025-04, Compensation—Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606): Clarifications to Share-Based Consideration Payable to a Customer. This Update is issued to reduce diversity in practice and improve the decision usefulness and operability of the guidance for share-based consideration payable to a customer in conjunction with selling goods or services. The amendments in this Update are effective for all entities for annual reporting periods (including interim reporting periods within annual reporting periods) beginning after December 15, 2026. Early adoption is permitted. The Company is currently in the process of evaluating the impact this amended guidance may have on its consolidated financial statements.

In December 2025, the FASB issued ASU 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities. This Update is issued to establish the accounting for a government grant received by a business entity, including guidance for (1) a grant related to an asset and (2) a grant related to income. For public business entities, the amendments in this Update are effective for annual reporting periods beginning after December 15, 2028, and interim reporting periods within those annual reporting periods. The Company is currently in the process of evaluating the impact this amended guidance may have on its consolidated financial statements.

In April 2026, the FASB issued ASU 2026-1, Equity (Topic 505): Initial Measurement of Paid-in-Kind Dividends on Equity-Classified Preferred Stock. This Update is issued to provide authoritative guidance on how an issuer should initially measure paid-in-kind (PIK) dividends on equity-classified preferred stock. The amendments in this Update are effective for all entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. The Company is currently in the process of evaluating the impact this amended guidance may have on its consolidated financial statements.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

3. Discontinued Operation

On April 30, 2025, the Board resolved to discontinue the operations of Shandong Yunchu. Subsequently, on September 1, 2025, the Company disposed of its 100% equity interest in Promising Prospect HK Limited (“Promising HK”) for nominal consideration. Promising HK holds the 100% equity interest in Shandong Yunchu through Jiayi Technologies and does not own any other operating assets of the Company.

The discontinued operation represents a strategic shift that has a major effect on the Company’s operations and financial results, which trigger discontinued operations accounting in accordance with ASC 205-20-45. Results of operations related to the discontinued operations for the three months ended March 31, 2025 were retroactively reported as loss from discontinued operations. The results of discontinued operations for the three months ended March 31, 2025 are as follows:

4. Accounts Receivable, Net

The Company extends credit terms of 15 to 60 days to the majority of its domestic customers, which include third-party distributors, supermarkets, and wholesalers.

The following table summarizes the Company’s accounts receivable by aging bucket:

5. Advances to Suppliers, Net

Prepayments mainly include advance payment to suppliers and vendors to procure raw materials. Prepayments consist of the following:

6. Inventories, Net

Inventories consisted of the following as of March 31, 2026 and December 31, 2025**:**

7. Plant and Equipment, Net

Plant and equipment consisted of the following as of March 31, 2026 and December 31, 2025:

Depreciation expense for the three months ended March 31, 2026 and 2025 was $175,486 and $152,413, respectively.

Impairment of plant and equipment movement is as follows:

8. Intangible Assets

Amortization expense for the three months ended March 31, 2026 and 2025 was $25,903 and $33,083, respectively.

As of March 31, 2026, the estimated future amortization expenses of the intangible assets were as follow:

9. Other Payables and Accrued Liabilities

As of March 31, 2026 and December 31, 2025, the balance of other payable and accrued liabilities was $1,951,020 and $2,140,130 respectively. Other payables – third parties are those non-trade payables arising from transactions between the Company and certain third parties.

10. Advance from Customer

For our operations, the proceeds received from sales are initially recorded as advances from customers, which are usually related to unsatisfied ¥ performance obligations at the end of an applicable reporting period. As of March 31, 2026 and December 31, 2025, the outstanding balance of the advance from customers was $212,899 and $213,127 respectively. Due to the generally short-term duration of the relevant contracts, most of the performance obligations are satisfied in the following reporting period.

11. Related Party Transactions

As of March 31, 2026 and December 31, 2025, the outstanding balance due from related parties was $3,081,792 and $2,736,302, respectively. Outstanding balances of significant related parties are stated below:

These nontrade receivables, as noted above, arise from transactions between the Company and certain related parties, such as loans to these related parties. These loans are unsecured, non-interest bearing and due on demand. Receivables from Mr. Haiyan Xiong mainly include advances to Mr. Haiyan Xiong for procurement of raw material and carriage.

As of March 31, 2026 and December 31, 2025, the outstanding balance due to related parties was $3,180,701 and $1,924,426, respectively. The balances represent advances for working capital needs of the Company, and are non-interest bearing and unsecured unless otherwise disclosed herein. Pursuant to a tripartite agreement dated March 20, 2026 among the Company, Ms. Luojie Pu and Mr. Bin Zhou, the balance of $872,803 previously owed to Ms. Luojie Pu was assumed by Mr. Bin Zhou and reclassified accordingly.

Outstanding balances of significant parties are stated below:

12. Goodwill

The changes in the carrying amount of goodwill by reportable segment are as follows**:**

13. Bank Loans

The outstanding balances on short-term and long-term bank loans consisted of the following:

The loan from the Jingshan City branch of Postal Savings Bank of China was obtained to support general working capital, with no guarantee requirement for this loan.

The loan from the Jingshan City branch of Agricultural Bank of China was obtained to support general working capital, with a comprehensive guarantee provided by Mr. Bin Zhou and Hubei Bulaisi Technology Co., Ltd..

The loan from the Hubei Jingshan Rural Commercial Bank Co. Ltd. was obtained to support general working capital, with certain buildings and land use rights of Hubei Ruishengchang Industrial Co., Ltd. in the amount of RMB 3.6 million (equivalent to $521,890) pledged as collateral, as well as comprehensive guarantee provided by Mr. Bin Zhou, Mr. Bin Zhang, senior management of the Company, Mr. Ge Wei, a third-party individual, Hubei Bulaisi Technology Co., Ltd. and Hubei Ruishengchang Industrial Co., Ltd., which is under control of Mr. Ge Wei.

The loan from Jingmen Branch of Bank of China was obtained to support general working capital, with no guarantee requirement for this loan.

The loan from Hubei Bank Jingshan Branch was obtained to support general working capital, with a comprehensive guarantee provided by Mr. Bin Zhang, his wife Ms. Shunhui Gao, and Hubei Bulaisi Technology Co., Ltd., which is under the company’s control.

The loan from Chajiaduo Supply Chain Hubei Co., Ltd. was obtained to support general working capital, with no guarantee requirement.

The loan from Mr. Wei Jin was obtained to support general working capital, with no guarantee requirement.

Interest expense for the three months ended March 31, 2026 and 2025 was $49,144 and $22,512, respectively.

14. Equity

On August 29, 2025, the stockholders of the Company approved the 2025 Equity Incentive Plan (the “2025 Plan”), which provides that up to 7,000,000 shares of common stock, par value $0.001 per share, may be issued pursuant to grants of equity-based awards under the 2025 Plan. During the year ended December 31, 2025, the Company issued an aggregate of 6,950,000 shares of common stock to nine employees under the 2025 Plan for a fair value of $14,429,500. The fair value is determined based on the stock price on the grant date.

As of March 31, 2026, the number of common shares issued and outstanding was 14,232,714.

15. Earnings (Loss) Per Share

16. Concentrations

Customers Concentrations:

The following table sets forth information about each customer that accounted for 10% or more of the Company’s revenues for the three months ended March 31, 2025. For the three months ended March 31, 2026, no single customer accounted for more than 10% of the Company’s total revenue.

Suppliers Concentrations

The following table sets forth information about each supplier that accounted for 10% or more of the Company’s purchase for the three months ended March 31, 2026 and 2025.

For the three months ended March 31, 2026, two suppliers (Supplier E and Supplier F) accounted for approximately 63% and 28% of the Company’s total purchases, respectively, for a combined concentration of approximately 91%. The Company does not have long-term supply agreements with these suppliers. The loss of, or a significant reduction in purchases from, either of these suppliers could materially disrupt the Company’s operations and adversely affect its financial condition and results of operations.

17. Credit risk

The Company’s deposits are made with banks located in the PRC. Cash maintained in banks within the People’s Republic of China of less than RMB 0.5 million (equivalent to $72,485) per bank are covered by “deposit insurance regulation” promulgated by the State Council of the People’s Republic of China. As of March 31, 2026 and December 31, 2025, the Company had $5,214,957 and $24,691, respectively, in cash balances held at PRC financial institutions that exceeded the applicable insured limits. There isno cash balances held at American or Cananda financial institutions that exceeded the applicable insured limits as of March 31, 2026 and December 31, 2025.

Since the Company’s inception, the age of account receivables has been less than one year, indicating that the Company is subject to the minimal risk borne from credit extended to customers.

18. Contingencies

The Company records accruals for certain of its outstanding legal proceedings or claims when it is probable that liability will be incurred and the amount of loss can be reasonably estimated. The Company evaluates, on a quarterly basis, developments in legal proceedings or claims that could affect the amount of any accrual, as well as any developments that would make a loss contingency both probable and reasonably estimable. The Company discloses the amount of the accrual if it is material.

When a loss contingency is not both probable and estimable, the Company does not record an accrued liability but discloses the nature and the amount of the claim, if material. However, if the loss (or an additional loss in excess of the accrual) is at least reasonably possible, then the Company discloses an estimate of the loss or range of loss, unless it is immaterial or an estimate cannot be made. The assessment of whether a loss is probable or reasonably possible, and whether the loss or a range of loss is estimable, often involves complex judgments about future events. Management is often unable to estimate the loss or a range of loss, particularly where (i) the damages sought are indeterminate, (ii) the proceedings are in the early stages, or (iii) there is a lack of clear or consistent interpretation of laws specific to the industry-specific complaints among different jurisdictions. In such cases, there is considerable uncertainty regarding the timing or ultimate resolution of such matters, including eventual loss, fine, penalty or business impact, if any. The Company has analyzed its operations subsequent to March 31, 2026 to the date these unaudited condensed consolidated financial statements were issued and has determined that it does not have any material contingency events to disclose.

19. Subsequent Events

The Company evaluates subsequent events that have occurred after the balance sheet date but before the financial statements are issued. There are two types of subsequent events: (1) recognized, or those that provide additional evidence with respect to conditions that existed at the dates of the balance sheets, including the estimates inherent in the process of preparing financial statements, and (2) non-recognized, or those that provide evidence with respect to conditions that did not exist at the date of the balance sheet but arose subsequent to that date. The Company has analyzed its operations subsequent to March 31, 2026 to the date these unaudited condensed consolidated financial statements were issued, and has determined that other than described below, it does not have any material subsequent events to disclose.

On April 6, 2026, Hubei Shengsili signed a loan agreement with two third party companies, Shengsili (Hubei) Trading Co., Ltd. (“Shengsili Trading”) and Dongyang Hongshuo Network Technology Co., Ltd. (“Dongyang Hongshuo”), to lend RMB 10 million (equivalent to approximately $1.45 million) to Shengsili Trading as working capital for 60 days, with the maturity date on June 6, 2026. There is no interest and guarantee requirement for this loan. If Shengsili Trading fails to fully repay the loan within 60 days, the loan will be offset against the amount that Hubei Shengsili is obligated to pay to Dongyang Hongshuo.