Xiamen Engineering Co., Ltd. released its 2011 three-quarter report. The main operating results are as follows: in the 1st to 3rd quarter of 2011, the company achieved operating income of 9.454 billion yuan, an increase of 30.24% over the previous year; realized net profit attributable to the parent company of 536 million yuan, an increase of 6.24% over the previous year, and 0.69 yuan per diluted share. The main points are as follows: 1. Earnings for the first three quarters were lower than expected, and factors such as inventory led to an increase in short-term operating pressure; 2. Cost increases led to a 1.96 percent year-on-year decline in comprehensive gross margin, and gross margin is expected to remain stable in the fourth quarter; 3. The increase in the expense ratio during the period led to a decrease of 1.28 percentage points in the net interest rate. The net interest rate for the whole year is expected to be about 5.5%; 4. The company's revenue for 2011 and 2012 is estimated to be 12 billion yuan and 13.6 billion yuan, respectively, with earnings per share of 0.80 yuan and 0.95 yuan, respectively. The PE corresponding to the closing price on October 28 is 15 and 13 times, respectively, maintaining a “careful recommendation” rating.