Performance Review Company Announces Report for the First Quarter of 2012: Achieved operating income of 104 million, a year-on-year decrease of 10.42%; achieved net profit attributable to shareholders of listed companies of 10.66 million, an increase of 12.13% over the previous year. The main reasons for the decline in operating income of management analysis companies are: due to capital and weather factors, the operation of key downstream projects and mines was insufficient; we believe that the first quarter was the traditional low season for the bombing industry, which had little impact on the annual performance; as key downstream projects gradually resume work in the second quarter, sales of explosion products will gradually warm up. At the Hunan Civil Explosive Equipment Industry Work and Planning Conference in December 2011, the company signed a sales contract for 19,800 tons of industrial explosives with users in the province, and completed sales of 4,212 tons in the first quarter, with a completion rate of 21.5%. The integration is progressing steadily: the company plans to adjust the share exchange, absorption and merger plan to target shares to purchase shares held by Shenaxe Minbang shareholders; at the same time, the company promised to disclose the restructuring report on May 20. The effects of integration gradually became apparent: On April 19, Shanaxe Minbang signed strategic cooperation framework agreements with eight provincial units of Hunan Nonferrous Metals, Xiangtou Group, Xiangmedia Group, Construction Engineering Group, Road and Bridge Group, Jinxin Gold Group, Development Group, and Huatian Group; further consolidated the province's advantages and laid the foundation for the rapid development of group companies after integration. Profit forecasts and investment recommendations We maintain our forecasts. Assuming that none of the dissenting shareholders of Shanaxe Minbang exercise cash options and the maximum share capital is diluted, the corresponding EPS for 2012-2014 is 1.75 yuan, 1.95 yuan, and 2.12 yuan. Considering that the company's absorption and merger will expand downstream (integration of sales channels within the province, cooperation in blasting services within and outside the province) after the completion of the merger, we will give the company 20x12PE with a target price of 35 yuan. We recommend purchasing.