From January to September 2010, the company achieved operating income of 1.036 billion yuan, down 4.9% from the same period last year; operating profit was-136 million yuan, compared with-38.47 million yuan in the same period last year; net profit belonging to the owner of the parent company was-1.02 million yuan, compared with-23.44 million yuan in the same period last year; EPS was-0.001 yuan. Of this total, operating income in the third quarter was 297 million yuan, down 13.3% from the same period last year; operating profit was-117 million yuan, compared with-21.42 million yuan in the same period last year; net profit belonging to the owner of the parent company was 17.12 million yuan,-16.39 million yuan compared with the same period last year; and EPS was 0.018 yuan.
Both gross profit margin and period expense rate have increased. In the first three quarters, the company's consolidated gross profit margin rose 0.4 percentage points year-on-year to 14.5%, down 1.1 percentage points from the first half of the year. The expense rate during the period was 17.8%, an increase of 1.8 percentage points over the same period last year. Among them, the sales expense rate fell 0.3 percentage points year-on-year to 7.4%; the management expense rate increased 1.8 percentage points to 8.9%; and the financial expense rate increased 0.3 percentage points year-on-year to 1.5%.
The return on investment fell sharply compared with the same period last year. The net profit of Qingqi Peugeot, which took a 50 per cent stake, continued to lose, resulting in an investment income of-2.23 million yuan, compared with 657 million yuan in the same period last year.
The relocation project of die casting factory in high-tech zone has been completed. On April 24th, the company and the management committee of Jinan High-tech Zone signed the Agreement on the relocation Project of Jinan Qingqi Technical Reform of China Armament Group. About 91200 square meters of land use rights and land attachment assets located in the die-casting factory area of Jinan High-tech Development Zone are transferred to the High-tech Zone. The company completed the land transfer and obtained the disposal income on September 3, 2010. as a result, the company's non-operating income in the first three quarters was 134 million yuan, an increase of 11.93 times compared with the same period last year.
The impairment loss on assets was 81.54 million yuan, compared with-3.72 million yuan in the same period last year. Mainly due to the disposal of the land of the die-casting plant in the high-tech zone, the value of the company's intangible assets was 162 million yuan, down 40.35% from the same period last year.
Asset restructuring is in progress. On September 3, the company announced the "major asset swap and related party transaction plan", in which the controlling shareholder Armament Group transferred its shares in the company to Changan, China, accounting for 31.43% of the total equity. China's Changan replaced its 100% stake in Hunan Tianyan with all the assets and liabilities of Jinan Qingqi. After the reorganization, the controlling shareholder of the company will become Changan, China, and the main business will be transformed into the production and manufacture of engine parts such as turbochargers, engine intake and exhaust valves and cooling fans.
Profit forecast and rating: the company is planning a major asset restructuring, we do not give investment rating and profit forecast for the time being.
