SHENZHEN,China,Dec. 17,2024 -- ZJK Industrial Co.,Ltd. (Nasdaq: ZJK) ("ZJK Industrial","ZJK",or the "Company"),a high-tech enterprise specialized in the manufacturing and sale of precision fasteners,structural parts and other precision metal parts products for new energy vehicles and intelligent electronic devices,today announced its unaudited financial results for the first six months of fiscal year 2024 endedJune 30,2024.

First Six Months of Fiscal Year 2024 Financial Highlights

Revenue increased by 72.81%,to US$16.23 million for the six months ended June 30,2024,from US$9.39 million for the same period of last year.

Gross profit increased by 134.31%,to US$7.56 million for the six months ended June 30,from US$3.23 millionfor the same period of last year.

Income from operations increased by 149.33%,to US$4.91 million for the six months endedJune 30,fromUS$1.97 millionfor the same period of last year.

Net income increased by 106.98%,to US$5.43 million for the six months endedJune 30,fromUS$2.62 millionfor the same period of last year.

Basic and diluted earnings per share wasUS$0.09for the six months endedJune 30,increased fromUS$0.04for the same period of last year.

Mr.Ning Ding,Chief Executive Officer and Chairman,commented,"We are thrilled to report outstanding performance in the first half of fiscal year 2024,with revenues surging 72.81% to US$16.23 million. This growth reflects our strategic efforts to expand our market presence and meet the high demand for our product offerings amidst the rapidly evolving technology revolution.

Our remarkable growth has been driven primarily by our unwavering commitment to innovation,advancements in production technology,stringent cost control measures,and adaptive sales and marketing strategies. These efforts contributed to an increase in our average unit sales price,resulting in gross profit rising 134.31% to US$7.6 million for the period,while gross profit margin improved significantly from 34.34% to 46.57%.

To meet surging demand,we expanded our production capacity by leasing three additional factories during this period. Simultaneously,we enhanced sales and marketing initiatives to drive sales and maintained investment in research and development,even as mature product models required less material consumption.

Looking ahead,we remain optimistic and confident in our sustainable growth potential. Our steadfast focus on technology innovation and specialized advanced solutions will continue to distinguish us from our competitors. By deeply cultivating our expertise in sub-assembly and assembly manufacturing,we believe we are poised to deliver long-term value to our shareholders."

First Six Months of Fiscal Year 2024 Financial Results

Revenue

Revenue increased by 72.81%,from US$9.39 million for the same period of last year. Revenues generated from customers in China accounted for 97.27% and 86.50% of the total revenue for the six months ended June 30,2023,and 2024,respectively.

Revenue from sales of hardware products increased by 72.81%,from US$9.39 million for the same period of last year. The increase was mainly due to (i) the total sales volume of the Company's products for the six months ended June 30,2024 increased by 44.55% compared to that for the same period of last year and (ii) the average unit sales price of the Company's products for the six months ended June 30,2024 increased by 21.91% compared to that for the same period of last year as the Company reduced the discount provided to one of its major customers with stable cooperation.

For turned parts,the average unit sales price increased by 28.25% and the sales volume increased by 39.73% for the six months ended June 30,compared to those for the same period of last year,resulting in an increase of US$3.29 million in revenue. For screws,the average unit sales price of screws increased by 8.10% and the sales volume increased by 45.98% for the six months ended June 30,resulting in a total increase of US$2.51 million in revenue. For stamping parts,the sales volume increased by 12.84% for the six months ended June 30,compared to that for the same period of last year,resulting in a total increase of US$0.79 million in revenue.

Cost of Revenue

Cost of revenues increased by 40.64%,to US$8.67 million for the six months ended June 30,from US$6.17 million for the same period of last year,which was in line with the increase of sales volume of self-production products and products from third party manufacturers,and the total sales volume increased by 44.55% for the six months ended June 30,2024 compared to that for the same period of last year.

Gross Profit and Gross Profit Margin

Gross profit increased by 134.31%,from US$3.23 million for the same period of last year. The gross profit increased mainly due to the increased sales volume and the increased average unit sales price of turned parts and stamping parts.

The gross profit margin increased by 12.23%,to 46.57% for the six months ended June 30,from 34.34% for the same period of last year,mainly due to (i) the average unit sales price of the Company's products increased as the Company reduced the discount provided to one of its major customers with stable cooperation; (ii) the average unit cost decreased resulting from the improvement of the Company's production technology and the discount provided by its suppliers.

General and administrative expenses

The general and administrative expenses increased by 245.36%,to US$1.22 million for the six months ended June 30,from US$0.35 million for the same period of last year,which was primarily attributable to (i) an increase of US$0.58 million in professional service fees due to an increase of accounting advisory fee,(ii) an increase of US$0.04 million in salaries and benefits for administrative personnel due to an increase of employee headcounts resulting from the Company's business growth,(iii) an increase of US$0.04 million in rental expenses as the Company entered into a lease agreement for a factory in Vietnam in April 2023 and two lease agreements for factories in Qingyuan,China in June 2024 to expand its production scale.

Selling and marketing expenses

The selling and marketing expenses increased by 123.17%,to US$1.18 million for the six months ended June 30,from US$0.53 million for the same period of last year,which was primarily due to an increase of US$0.38 million in sales commission and an increase of US$0.24 million in freight for selling activities which were both attribute to the increase of the Company's revenue for the six months ended June 30,2024.

Research and development costs

The research and development costs decreased by 35.69%,from US$0.37 million for the six months ended June 30,to US$0.24 million for the same period of last year,which was primarily attributable to a decrease of US$0.13 million in material consumption as the types of products the Company developed in 2024 have a less material consumption than what the Company's consumed for the same period of last year.

Income from operations

Income from operations increased by 149.33%,to US$4.91 million for the six months ended June 30,from US$1.97 million for the same period of last year.

Other income,net

Other income,net increased by 31.78%,to US$1.26 million for the six months ended June 30,from US$0.95 million for the same period of last year,which was primarily attributable to (i) an increase in investment income of US$0.19 million generated from long-term equity investment in PSM-ZJK Fasteners (Shenzhen) Co.,Ltd,(ii) a decrease of US$0.06 million in interest expenses due to the decrease of commercial vehicle mortgage loan for the six months ended June 30,2024.

Net Income

Net income increased by 106.98% to US$5.43 million for the six months ended June 30,from US$2.62 million for the same period of last year.

Basic and Diluted Earnings per Share

Basic and diluted earnings per share wasUS$0.09for the six months endedJune 30,compared toUS$0.04for the same period of last year.

Financial Condition

As of June 30,the Company had cash of US$8.56 million and restricted cash of US$1.70 million,compared to US$2.83 million and US$1.08 million as of December 31,respectively. Net cash provided by operating activities was US$7.73 million for the six months ended June 30,compared to US$3.93 million for the same period of last year.

Net cash used in investing activities was US$0.32 million for the six months ended June 30,compared to US$0.04 million for the same period of last year.

Net cash used in financing activities was US$0.47 million for the six months ended June 30,compared to US$0.51 million for the same period of last year.

Recent Development

OnOctober 1,the Company completed its initial public offering (the "Offering") of 1,250,000 ordinary shares at a public price ofUS$5.00per share. OnOctober 30,the underwriters of the Offering partially exercised their over-allotment option to purchase an additional 131,249 ordinary shares of the Company at the public offering price ofUS$5.00per share. The gross proceeds wereUS$6.91 millionfrom the Offering,before deducting underwriting discounts and commissions,and other expenses. The Company's ordinary shares began trading on the Nasdaq Capital Market onSeptember 30,under the ticker symbol "ZJK."

About ZJK Industrial Co.,Ltd.

ZJK Industrial Co.,Ltd. is a high-tech enterprise specializing in the manufacturing and sale of precision fasteners,structural parts and other precision metal parts applied in a variety of industries,including intelligent electronic equipment,new energy vehicles,aerospace,energy storage systems,medical and liquid cooling systems used in artificial intelligence supercomputers. With thirteen-year involvement in the precision metal parts manufacturing industry,the Company maintains a skilled professional team,a series of highly automated and precision manufacturing equipment,stable and strong customer group,and complete quality management systems. ZJK mainly offers standard screws,precision screws and nuts,high-strength bolts and nuts,turning and Computer Numerical Control (CNC) machining parts,Surface Mounting Technology (SMT) for miniature parts packaging,and technology service for research and development from a professional engineering team. For more information,please visit the Company's website athttps://ir.zjk-industrial.com/.

Forward-Looking Statements

Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company's current expectations and projections about future events that the Company believes may affect its financial condition,results of operations,business strategy and financial needs. Investors can find many (but not all) of these statements by the use of words such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "likely to" or other similar expressions in this announcement. The Company undertakes no obligation to update or revise publicly any forward-looking statements to reflect subsequent occurring events or circumstances,or changes in its expectations,except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable,it cannot assure you that such expectations will turn out to be correct,and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results in the Company's registration statement and other filings with the U.S. Securities and Exchange Commission.

For more information,please contact:

ZJK Industrial Co.,Ltd.

Phone: +86-755-28341175

Email: ir@zjk-industrial.com

Ascent Investor Relations LLC

Tina Xiao

Phone: +1-646-932-7242

Email: investors@ascent-ir.com

ZJKIndustrial Co.,Ltd.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In U.S. dollars,except for numbers of shares data)

As of

December 31,2023

June 30,2024

(Unaudited)

ASSETS

Current assets

Cash

2,826,725

8,559,892

Restricted cash

1,075,047

1,704,278

Accounts receivable,net

10,268,807

6,982,123

Accounts receivable-due from a related party

8,816,184

5,295,551

Inventories,net

4,765,742

6,721,310

Prepaid expenses and other current assets,net

503,914

644,290

Other receivables-due from related parties

277,786

309,243

Deferred initial public offering ("IPO") costs,current

-

697,613

Total current assets

28,534,205

30,914,300

Non-current assets

Property,plant and equipment,net

5,596,699

5,758,823

Operating lease right-of-use assets

522,148

1,200,188

Finance lease right-of-use assets

336,257

168,463

Construction in progress

41,200

57,167

Long-term investment

2,517,538

3,395

Deferred tax assets,net

165,969

289,959

Deferred IPO costs,non-current

566,417

-

Total non-current assets

9,746,228

11,033,995

TOTAL ASSETS

38,280,433

41,948,295

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities

Short-term bank borrowings

37,184

97,699

Accounts payable

11,569,828

10,454,466

Income tax payable

1,035,152

1,367,684

Accrued expenses and other current liabilities

841,402

712,785

Other payables-due to related parties

1,867,459

1,537,393

Operating lease liability,current

157,980

328,383

Finance lease liability,current

230,460

92,947

Other long-term debt,current

9,379

-

Total current liabilities

15,748,844

14,591,357

Non-current liabilities

Operating lease liability,non-current

290,684

790,147

Other long-term debt,non-current

20,321

-

Deferred tax liabilities

518,156

418,331

Total non-current liabilities

829,161

1,208,478

TOTAL LIABILITIES

16,578,005

15,799,835

Commitments and contingencies (Note 14)

Shareholders' equity

Ordinary shares,$0.000016666667 par value,3,000,000 shares

authorized,60,000 and 60,000 shares issued and

outstanding as of December 31,2023 and June 30,

respectively*

1,000

1,000

Additional paid-in capital

1,792,559

1,559

Statutory surplus reserves

2,283,180

2,180

Retained earnings

18,644,082

24,070,993

Accumulated other comprehensive loss

(1,016,563)

(1,999,098)

Total ZJK Industrial Co.,Ltd. shareholders' equity

21,258

26,148,634

Non-controlling interests

(1,830)

(174)

Total shareholders' equity

21,702,428

26,460

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

38,295

* The shares and per share information are presented on a retroactive basis to reflect the reorganization completed on March 28,2023 (Note 1) and the two share splits that occurred on June 19,2023 and June 6,respectively (Note 15).

ZJKIndustrial Co.,Ltd.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE

INCOME

(In U.S. dollars,except for the number of shares data)

For the six months ended June 30,

2023

2024

(Unaudited)

Revenues

Third-party sales

4,211,947

8,508,295

Related-party sales

5,179,789

7,659

Total revenues

9,391,736

16,229,954

Cost of revenues

Third-party sales

(1,755,183)

(3,553,017)

Related-party sales

(4,411,119)

(5,119,335)

Total cost of revenues

(6,166,302)

(8,672,352)

Gross profit

3,225,434

7,557,602

Operating expenses

Selling and marketing expenses

(527,810)

(1,177,918)

General and administrative expenses

(354,610)

(1,224,664)

Research and development costs

(371,298)

(238,779)

Gain from disposal of property,plant and equipment

80

-

Total operating expenses

(1,253,638)

(2,641,361)

Income from operations

1,971,796

4,916,241

Other income,net

Interest expenses

(73,591)

(12,474)

Interest income

7,764

35,678

Share of profits from equity method investment

917,045

1,107,771

Currency exchange (loss) gain

(7,457)

45,534

Other income,net

110,200

80,639

Total other income,net

953,961

1,257,148

Income before income tax provision

2,925,757

6,173,389

Income tax provision

(303,021)

(744,853)

Net income

2,622,736

5,428,536

Less: net income attributable to non-controlling interests

1,470

1,625

Net income attributable to ZJK Industrial Co.,Ltd.'s

shareholders

2,621,266

5,426,911

Other comprehensive (loss) income

Foreign currency translation adjustment attributable to parent

company

(808,054)

(982,535)

Foreign currency translation adjustment attributable to non-

controlling interest

(27)

31

Total comprehensive income

1,814,655

4,446,032

Comprehensive income attributable to non-controlling interests

1,443

1,656

Comprehensive income attributable to ZJK Industrial Co.,Ltd.'s

shareholders

1,813,212

4,444,376

Earnings per share

Basic and Diluted*

0.04

0.09

Weighted average shares used in calculating earnings per

share

Basic and Diluted*

60,000

60,000

* The shares and per share information are presented on a retroactive basis to reflect the reorganization completed on March 28,Ltd.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In U.S. dollars,

2023

2024

(Unaudited)

Cash flows from operating activities:

Net income

2,736

5,536

Adjustments to reconcile net income to net cash provided by

operating activities:

Provision for credit loss

-

8,575

Depreciation of property,plant and equipment

244,618

274,016

Amortization of operating lease right-of-use assets

118,733

158,590

Amortization of finance lease right-of-use assets

122,851

161,212

Interest expense of finance lease liabilities

-

3,344

Gain from the disposal of property,plant and equipment

(80)

-

Provision for inventories

123,713

134,294

Share of profits from equity method investment

(917,045)

(1,771)

Provisions for deferred income tax

81,179

(218,239)

Changes in operating assets and liabilities:

Accounts receivable

4,171,981

3,063,777

Accounts receivable-due from related parties

3,161,302

3,341,677

Inventories

(396,437)

(2,214,518)

Prepaid expenses and other current assets

(220,824)

(153,075)

Other receivables-due from related parties

(58,909)

(6,248)

Accounts payable

(4,471,736)

(1,688)

Income tax payable

(601,204)

358,940

Accrued expenses and other current liabilities

(263,641)

(62,010)

Other payables-due to related parties

334,138

(67,392)

Operating lease liability

(122,221)

(177,538)

Net cash provided by operating activities

3,929,154

7,725,482

Cash flows from investing activities:

Purchase of property,plant and equipment

(36,378)

(221,552)

Purchase of construction in progress

-

(65,066)

Loan to a related party

-

(230,710)

Collection of loan to a related party

-

198,832

Net cash used in investing activities

(36,378)

(318,496)

Cash flows from financing activities:

Proceeds from short-term bank borrowings

43,035

69,300

Repayments of short-term bank borrowings

-

(7,484)

Repayments of long-term debts

(235,260)

(29,226)

Deferred IPO costs

(112,389)

(145,279)

Repayments of financing lease liabilities

(200,524)

(136,508)

Repayments of loan from related parties

-

(221,760)

Net cash used in financing activities

(505,138)

(470,957)

Effect of exchange rate changes

(204,947)

(573,631)

Net change in cash and restricted cash

3,182,691

6,362,398

Cash and restricted cashat the beginning of period

1,516,314

3,901,772

Cash and restricted cashat the end of period

4,699,005

10,264,170

Supplemental disclosure of cash flow information:

Income tax paid

155,321

605,294

Interest expenses paid

14,387

8,140

Supplemental disclosures of non-cash activities:

Obtaining finance lease right-of-use assets in exchange for finance lease

liabilities

465,511

-

Obtaining operating right-of-use assets in exchange for operating lease

liabilities

-

862,655

Acquiring property,plant and equipment through accounts payable

-

345,535

Property,plant and equipment transferred from construction in progress

22,622

-

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.