From January to September 2008, the company achieved operating income of 5.260 billion yuan, a year-on-year decrease of 28.03%; operating profit - 368 million yuan, 243 million yuan in the same period last year; net profit attributable to owners of the parent company - 296 million yuan, 163 million yuan in the same period last year; and diluted earnings per share - 0.27 yuan. The sharp drop in zinc prices led to a 28.03% drop in revenue. The company is mainly engaged in lead-zinc smelting, sulfuric acid processing and other businesses, of which the zinc business accounts for 80% of revenue (mid-2008). Revenue for the first three quarters of 2008 fell 28.03% year on year, mainly due to a sharp drop in zinc prices. During the reporting period, Changjiang spot 1 #锌均价同比下跌40 .86% was in stock. Multiple factors have led to a sharp deterioration in the company's performance. During the reporting period, the company's gross profit margin was 2.72%, down 5.09 percentage points year on year; net sales margin was -5.63%, down 7.86 percentage points year on year. The deterioration in performance is mainly due to the following reasons: 1) the sharp drop in zinc prices; 2) the company currently has no own mineral raw material supply base, so the company's raw material costs are higher than the industry average; 3) The technical equipment is poor. The company's current zinc production capacity is close to 400,000 tons, of which 200,000 tons are pyrotechnic vertical tank zinc refining. Vertical tank zinc refining is a relatively backward process. There are disadvantages such as high energy consumption and expensive silicon carbide materials. Poor technology is one of the company's biggest weaknesses; 4) The price of coal and coke has remained high and further increased. The company's cost pressure; 5) Due to the fall in zinc prices Asset impairment losses of 128 million yuan were calculated during the reporting period, leading to a further increase in the company's profit losses. It is difficult to “save” the sulfuric acid business. The company's sulfuric acid business accounts for less than 10% of revenue, but due to gross margin of over 80%, the gross profit ratio reached 288% (mid-2008). Driven mainly by oil prices and downstream phosphate fertilizer demand in the first half of the year, sulfuric acid prices soared, and sulfuric acid prices rose more than 200% year on year during the reporting period. However, with the sharp drop in oil prices and downstream demand for phosphate fertilizer entering the low season, the price of sulfuric acid has dropped by 70% to 450 yuan/ton since September, and it is expected that support for the company's main business will greatly weaken in the fourth quarter. Furthermore, in November 2007, the actual controller of the company was changed to China Metallurgical Group. How China Metallurgical Group operates in the later stages is also the key to the future development of the company. The zinc industry remains weak. With the rapid release of smelting capacity and weakening downstream demand, the situation of electric zinc oversupply is becoming more and more prominent. According to the International Lead-Zinc Research Group, the global oversupply was 150,000 tons in 2008, and it will expand to 330,000 tons in 2009. As expectations of the supply and demand situation deteriorated, domestic zinc prices fell all the way. Since the highest price for the whole year, they have fallen by a cumulative total of 54.69%. Furthermore, adjustments in export tax rebate policies, continued rise in energy prices, and insufficient working capital have further increased the cost pressure and operating risks of zinc smelting enterprises. It is expected that the company's zinc smelting business losses will increase in the fourth quarter.