In 2011, the company achieved operating income of 962 million yuan, up 17.28% year on year; operating profit of 148 million yuan, up 23.00% year on year; net profit attributable to owners of parent company 118 million yuan, up 11.67% year on year; and achieved basic earnings per share of 0.60 yuan. The distribution plan is to distribute a cash dividend of 2 yuan (tax included) for every 10 shares. The two major businesses of specialty paper and power batteries are growing steadily. The company is mainly engaged in the production and sale of special paper such as industrial supporting paper, filter paper, specialty food packaging paper, etc., as well as power batteries. Currently, it is the only domestic manufacturer that can produce electrolytic capacitor paper in series. In 2011, all of the company's specialty paper types achieved sales revenue growth. Among them, filter paper grew the fastest, with a year-on-year increase of 55.48%, and the lowest growth rate was industrial supporting paper, which increased 8.02% year on year, but still maintained the company's largest business position with a revenue share of 43%; in addition to specialty paper, the company's other major product, power batteries, increased revenue by 17.01% this year, with a revenue share of 18.47%. The increase in gross margin lays the foundation for performance growth, and income tax expenses reduce the growth rate of net profit. In 2011, in the face of high domestic inflationary pressure and continued turmoil in the international economy, the company's business strategy was appropriate, and the gross margin of various products maintained a steady increase. The gross margin of filter paper, power batteries, and industrial supporting paper increased by 3.85, 3.27, and 0.80 percentage points, respectively, and the comprehensive gross margin increased by 1.13 percentage points. Although the cost ratio for the period also increased by 0.99 percentage points due to the increase in R&D investment in the current period, it is still possible to ensure that the growth rate of operating profit exceeds the growth rate of revenue. However, corporate income tax expenses increased by 73.89% in the current period, which ultimately reduced net profit growth. R & D, technical reform, and production expansion, actively respond to future competition, and strengthen the position of the industry. In the specialty paper industry where the company is located, its main competitors are specialty paper companies from Japan and developed countries in Europe and America, and there is still a gap in the company's overall technical level compared to that. At the same time, in China, although the company is in a leading position in some specialty paper products, there are still a few manufacturers that produce some types of electrolytic capacitor paper, which has had an impact on the company's low- and middle-end markets, and competition is becoming increasingly intense. Currently, the company is focusing on the three aspects of product research and development, production line technical reform, and production capacity expansion, taking into account quality, efficiency and cost, implementing business strategies, and meeting future challenges. The technical transformation project for the electric paper production line with an annual output of 11,000 tons, the filter paper series special paper technology transformation project with an annual output of 14,000 tons, and the new construction project for lithium-ion power batteries for vehicles, which were invested with raised capital, are all progressing smoothly. It is expected that construction will be completed by the end of 2012 and the end of 2013, respectively, which is expected to form an important foundation for future performance growth. Profit forecasting and investment ratings. The company's earnings per share for 2012-2013 are estimated to be 0.59 yuan and 0.69 yuan respectively. Based on yesterday's closing price, the corresponding dynamic price-earnings ratio is 22 times and 19 times, respectively, maintaining the company's “increase in holdings” investment rating. Risk warning. 1) The risk of fluctuations in the prices of raw materials such as bleached wood pulp, insulated wood pulp, and hemp pulp; 2) The risk that competition in the industry exceeds expectations.