From January to September 2009, the company achieved operating income of 140 million yuan, an increase of 23.9% over the same period last year, an operating profit of 27.1 million yuan, an increase of 24.3% over the same period last year, and a net profit of 23.09 million yuan belonging to the parent company, an increase of 39.2% over the same period last year. Of this total, the operating income in the third quarter was 59.57 million yuan, an increase of 74.6 percent over the same period last year, and the net profit belonging to the parent company was 9.1 million yuan, an increase of 287.1 percent over the same period last year, and earnings per share was 0.09 yuan.
The growth rate of income accelerated. Operating income in the third quarter increased by 74.6% compared with the same period last year, mainly due to the increase in production and sales brought about by the expansion of the market, and the entry into the peak sales season in the second half of the year.
The gross profit margin has risen sharply. From January to September, the company's gross profit margin was 29.1%, an increase of 3.2 percentage points over the same period last year, of which the gross profit margin in the third quarter was 29.5%, a sharp increase of 9.9% over the same period last year. We believe that the improvement in product structure brought about by the accumulation of brand effect is the main reason for the substantial increase in gross profit margin.
Research and development expenditure brings about an increase in management costs. During the reporting period, the rate of management expenses increased by 2.5% year-on-year, especially in the third quarter, which was 5.9%, an increase of 4% over the same period last year. The expense of R & D expenditure directly invested by Zhejiang Langsha underwear Company is the main reason for the sharp rise in management costs.
The future depends on the expansion of the market. During the reporting period, the operating condition of the company improved greatly and the growth rate of performance accelerated. In the future, we will focus on the growth of production and sales brought about by market expansion, as well as the increase in gross profit margin brought about by the improvement of product structure.
Earnings forecasts and ratings. We estimate that the EPS in 2009 and 2010 will be 0.36 yuan and 0.49 yuan respectively, which is calculated at the closing price of 17.99 yuan on October 30, and the corresponding dynamic PE will be 50X and 37X respectively, maintaining the "neutral" rating.
Risk hint. (1) the risk of market volatility and (2) the risk of market expansion.