From January to September 2009, the company achieved operating income of 506 million yuan, down 31.78% from the same period last year, operating profit of 9.16 million yuan, an increase of 37.89% over the same period last year, and net profit belonging to the parent company of 5.51 million yuan, down 28.28% from the same period last year. In the third quarter, the company realized operating income of 187 million yuan, down 23.31% from the same period last year, operating profit of 5.94 million yuan, an increase of 4.48% over the same period last year, and net profit belonging to the parent company of 5.01 million yuan, down 10.27% from the same period last year.
Operating income fell and gross profit margin rose. In the first three quarters, the company's operating income decreased by 236 million yuan, or 31.78%, compared with the same period last year, and the gross profit margin was 18.37%, up 5.07% from the same period last year. The main reason is that the business volume of the wholesale branch of the company has been greatly reduced, and while the operating income has declined, the operating cost has also dropped accordingly. Another reason for the decline in revenue is that revenue from the company's IT business has also declined as a result of the economic crisis.
The rate of financial expenses decreased and increased during the period. In the first three quarters, the company's expense rate during the period was 14.90%, up 3.73% from the same period last year, of which the sales expense rate and management expense rate rose 1.70% and 2.29% respectively from the same period last year, while the financial expenses decreased by 2.31 million yuan, down 0.26% from the same period last year. The main reason is that the company paid loan interest in the same period last year, but there was no loan in the current period.
Investment income fell sharply, affecting operating profits. In the first three quarters, the company's investment income decreased by 3.56 million yuan compared with the same period last year, mainly because the income from applying for new shares decreased by 1.93 million yuan compared with the same period last year. At the same time, the investment income of the participating companies according to the equity method decreased by 1.63 million yuan compared with the same period last year.
Business shrinks, IT declines, and future performance has no bright spots. In the current business composition of the company, the proportion of commercial operating income and gross profit is the largest, but with the adjustment of the business structure of the wholesale branch, the wholesale business is shrinking sharply; IT business is the company's fastest growing business in recent years, but in the first three quarters, due to the impact of the economic crisis, IT business has also declined greatly, and because the revenue is relatively small, it is difficult to contribute profits for the company. The current situation of the company's business is in an adjustment stage, coupled with the uncertainty of the strategic direction caused by the change of the actual controller, the short-term performance of the company has no bright spot.
Profit forecast and investment rating. We predict that the company's EPS in 2009, 2010 and 2011 will be 0.03yuan, 0.05yuan and 0.07yuan respectively. Calculated at the closing price of 8.17 yuan on October 30, the corresponding price-to-earnings ratios are 288X, 171X and 116X respectively, temporarily maintaining a "neutral" investment rating.
Risk hint. Business further shrinks or changes, macroeconomic fluctuations.