Summary of 2010 results: operating income was 315 million yuan, up 38.34% over the same period last year; operating profit was 49.51 million yuan, up 39.17% over the same period last year; net profit belonging to the parent company was 58.34 million yuan, up 106.32% over the same period last year; and earnings per share was 0.25 yuan, in line with our expectations.
The carry-over of real estate projects and divestiture contributed to a substantial increase in performance. The company's main business includes real estate development, lamp market leasing and commodity sales, mainly in Zhejiang, Sichuan and overseas. The substantial increase in the company's performance during the reporting period is mainly due to two points: 1, the settlement of sales of subsidiaries. The company's real estate development projects "Donglai Jinyuan" and "time Garden" projects have achieved a sales rate and capital recovery rate of 100% in 2010, of which "Donglai Jinyuan" has been successfully delivered, and "time Garden" has passed the overall acceptance. It is expected to be completed in February 2011; 2, the sale of assets. During the reporting period, the company stripped off education-related land and real estate, with a book value of 69.67 million yuan, an estimated value of 110 million yuan, and a value-added rate of 54.59%.
The financial structure is good. During the reporting period, the company's expense rate was 4.6%, a decrease of 1.4% over the same period last year, mainly due to a significant reduction in financial expenses due to the increase in interest income and the reduction in exchange losses. By the end of 2010, the company had 261 million yuan in paper cash, an increase of 66.24% over the beginning of the year, with no short-term liabilities (short-term loans + non-current liabilities due within one year) and loose short-term funds. The interest-bearing debt is 63.06 million yuan, and the accounts received in advance is 506 million yuan, an increase of 37.63% over the beginning of the year. After deducting the amount received in advance, the real debt ratio is only 4.48%. The long-term financial structure is good.
In the future, it may become the financing platform of Wenzhou Modern Service Group. In December 2010, the state-owned property rights of Zhejiang Oriental Group, the company's controlling shareholder, were transferred to Wenzhou Modern Service Investment Group Co., Ltd., the company said that it will take the modern service industry as the direction in the future, and continue to adhere to the "Trident" business strategy, that is, the development of trade and circulation industry as the leading, the real estate industry and capital operation as the two wings, the main industry to lead, the two wings to promote.
Profit forecast and investment rating. The company's annual report reveals that this year's business plan is 430 million yuan of main business income. Without considering the asset injection, we expect the company's EPS from 2011 to 2012 to be 0.28,0.32 yuan. Based on yesterday's closing price of 8.70yuan, the dynamic price-to-earnings ratio is 31 times and 27 times, which does not have the valuation advantage and maintains a "neutral" rating for the time being. However, it is suggested that investors should pay attention to the possible asset injection expectations of Wenzhou Modern Service Investment Group in the future.