From January to September 2009, the company achieved operating income of 697 million yuan, a year-on-year decrease of 42.94%, an operating profit of 7.84 million yuan, a year-on-year decrease of 244.64%, a net profit attributable to the parent company of 3.3 million yuan, a year-on-year decrease of 76.53%, and an income of 0.0093 yuan per share. Among them, the company achieved operating income of 264 million yuan in the third quarter, a year-on-year decrease of 31.38%, operating profit of 2.21 million yuan, an increase of 1674.92% over the previous year, and achieved net profit attributable to the parent company of 600,000 yuan, an increase of 3498.58% over the previous year, and achieved earnings of 0.002 yuan per share.
The company's consolidated reporting business changed during the reporting period. The company transferred 47.29% of its shares in Huade Plastic Products Co., Ltd. After the transfer, the company held 5% of the company's shares. The decline in the company's operating income was partly due to changes in the scope of consolidation.
Bicycle exports are gradually picking up. Another major factor that led to the decline in the company's revenue in the first 3 quarters was the decline in bicycle export sales revenue. As can be seen from the revenue share in 2008, 60% of the company's revenue came from product exports. Due to the low added value of China's bicycle exports, low export profits, and lack of ability to withstand risks, it was significantly affected by the financial crisis. Although the company's revenue in the third quarter was still declining year on year, the decline decreased, and the year-on-month increase was 19.8%. Judging from the amount of bicycle exports according to the Bureau of Statistics data, the amount of bicycle exports in each month of 2009 increased month by month, and bicycle exports are gradually picking up.
The transfer of shares in subsidiaries has greatly increased investment returns. From January to September 2009, the company's investment income was 1.06 million yuan, an increase of 93.39% over the previous year. Proceeds mainly from the transfer of shares in the subsidiary Huade Plastic Products Co., Ltd.
Profit forecast and investment rating: We expect the company's 2009-2011 EPS to be 0.01 yuan and 0.011 yuan and 0.014 yuan respectively. Based on the calculation of the closing price of 7.74 yuan on October 28, the corresponding dynamic PE was 746 times, 679 times, and 546 times, respectively, maintaining the company's “neutral” investment rating.
Risk warning: 1. Risk of slow recovery in bicycle exports; 2. Risk of fluctuations in raw material prices.
