In the first quarter of 2011, the company achieved operating income of 793.53 million yuan, a year-on-year increase of 47.80%, a year-on-year increase of 3.37%; total profit of 58.22 million yuan, a year-on-year increase of 33.26%, an increase of 9.11%; and net profit attributable to shareholders of listed companies of 45.18 million yuan, a year-on-year increase of 36.19%, a year-on-year decrease of 8.04%. Earnings per diluted share for a single quarter were $0.12. The company expects net profit attributable to shareholders of listed companies from January to June 2011 to increase by 50%-80% compared with the same period last year. The estimated earnings per share range for the second quarter is 0.12-0.16 yuan. Comment: The new business was successfully put into operation to improve performance. In October 2010, the company's 250,000 ton white cardboard project (200,000 tons plus 50,000 tons of technical improvement project) was successfully put into operation, which was the main growth point for the company's performance in 2011. Driven by the new business, the company achieved a significant year-on-year increase in quarterly revenue and performance. Despite the influence of Spring Festival factors in the first quarter, the company's total revenue and profit still increased well from month to month. The popularity of wrapping paper is still at a high level. The company specializes in high-grade wrapping paper, and benefiting from a favorable external economic environment, downstream demand for wrapping paper is still quite strong. Price increases for some products in the first quarter of 2011 increased the consolidated gross margin by 0.22 percentage points over the previous quarter to 16.36%, which is at a historically high level. Currently, the prices of raw materials and products remain high, and the level of profit is relatively stable. Generous returns on investing in advantageous industries. The total investment income of the company in the first quarter was 3.63 million yuan, which greatly exceeded the same period last year. It was mainly due to the increase in profits of the shareholding company Sharp Ace Pharmaceutical and Kangtai Microfinance Company. Through equity investment, the company obtained 20% of Zhejiang Sharp Ace Pharmaceutical's shares. Sharp Ace officially entered the listing counseling period in October 2010, and the business is also in a period of rapid growth, bringing a rich return on investment to the company. Refinancing enters the household paper sector. In 2010, the company initiated refinancing matters. It plans to issue no more than 160 million shares to specific targets on a non-public basis and raise no more than 950 million yuan in net capital for a green, environmentally friendly recycled household paper project with an annual output of 68,000 tons. The distribution plan has already been reviewed and approved by the shareholders' meeting. From an industry perspective, the main theme of renewable household paper is green and environmental protection. Currently, the market concentration of the industry is low, and there is huge room for development. From the perspective of the company, many years of experience in waste paper and papermaking have laid the technical foundation for the development of new businesses, but since household paper has strong consumer properties, the company is beginning preparations with channel construction, and it is expected that the performance contribution of the release of household paper production capacity will begin in 2013. Profit forecasts and investment advice. We forecast that the company's net profit for the year 11 and 12 will be 200 million yuan and 210 million yuan respectively, and the diluted EPS (not considering the impact of additional issuance on the dilution of share capital) will be 0.51 yuan and 0.54 yuan respectively, giving an increase in holdings rating and a target price of 9 yuan. Risk warning: (1) the risk of large fluctuations in raw material prices; (2) the risk of market development in the household paper business.