In 2010, the company achieved operating income of 239 million yuan, an increase of 9.4% over the same period last year; operating profit of 3.46 million yuan, an increase of 212.2% over the same period last year; net profit of 3.29 million yuan, an increase of 47.3% over the same period last year; diluted earnings per share of 0.015 yuan; the distribution plan is 0.4 yuan (including tax) for every 10 shares.
The quantity and quality of the company's main business are better than that of the previous year. Of this total, the business income of products such as motorcycles and special vehicles was 166 million yuan, up 6.76 percent over the same period last year, the gross profit margin was 8.67 percent, and the gross profit margin was 2.53 percent higher than that of the previous year; the operating income of power and garden machinery products was 62.12 million yuan, an increase of 7.97 percent over the same period last year, and the gross profit margin was 12.71 percent. The gross profit margin increased by 5.82 percentage points over the previous year. The sales volume of forest machinery products achieved a new breakthrough, up 34% from the same period last year, of which the sales volume of irrigation cutters increased by 99%, the best level in history.
Demand in the export market has bottomed out and rebounded, but it will take time to reach pre-crisis levels. In 2010, the export market achieved operating income of 75.85 million yuan, an increase of 9.25% over the previous year, accounting for 33.30% of the company's operating income, but there is still a big gap compared with the export income of more than 300 million yuan in the year before the financial crisis.
The new product is expected to become a new profit growth point of the company. The year 2010 is the year with the largest investment in new product development, the three new products LH1620, ATV700, 300A125wheeled car series have accelerated the progress of research and development; H project has submitted customer samples, of which SPE160 and pump have formed a batch production capacity, which is expected to be put into mass production in 2011.
Professional certification builds competitive advantage. In 2010, it completed the online declaration of motorcycle environmental protection consistency annual report, completed the national Ⅲ certification of LH125T-12D motorcycle, successfully passed the annual supervision and inspection of the factory with the new 3C standard of Ⅲ products, and completed the compulsory inspection of four kinds of fire pumps by the National Fire equipment testing Center. The competitive advantage of the company has been greatly improved.
Profit forecast and valuation. We estimate that the EPS of the company from 2011 to 2013 is 0.041 yuan, 0.074 yuan and 0.093 yuan respectively. Corresponding to the closing price on January 19, 2011, the dynamic PE was 278,154,122 times, respectively. Maintain a "neutral" investment rating.