In 2010, the company achieved operating income of 75.2472 million yuan, an increase of 20.72% over the previous year, total profit of 26.199 million yuan, an increase of 56.13% over the previous year, and net profit attributable to the parent company of 25.247 million yuan, an increase of 67.43% over the previous year. Achieved earnings of 0.15 yuan per share. The distribution plan is to send 2.5 shares for every 10 shares and distribute 0.5 yuan (tax included). The overall gross margin declined, and the cost ratio increased over the period. During the reporting period, the company's consolidated gross margin fell 4.02 percentage points year on year to 54.54%. This is mainly due to a 32.43% increase in operating costs over the same period last year due to rising raw material prices. The expense ratio for the period increased 4.44 percentage points to 49.10% year on year; of this, the sales expense ratio increased 4.89 percentage points to 25.38% year on year, mainly due to strengthened marketing teams and market development; and the financial expense ratio increased 1.63 percentage points to 1.44% year on year, mainly due to the addition of 30 million yuan in long-term bank loans. Major products have resumed growth, or may benefit from medical reforms. The company's main source of revenue and profit is the company's main source of revenue and profit, yet there are many brands in the throat and cold fields, and competition is fierce. Since the company went public for more than 3 years, both products have grown slowly, and in 2009 there was even negative growth. In 10 years, the company increased sales investment, strengthened the development of distributors, terminals and rural markets at all levels, and achieved a 20.72% year-on-year increase in operating income. With the strengthening of marketing efforts and the advancement of the 11-year national essential drug system, the company's main products may be expected to maintain relatively rapid growth. Natural dextrophornium production is worth paying attention to. In 2010, the company established a 5,000 mu plum blossom GAP planting base and a production line for extracting natural dextron from plum trees, and realized the domestic production of high-purity natural dextrophane. Natural dextrophornium is the main ingredient in formulations such as Double Throat Relief, Compound Salvia, Quick-acting Heart Relief Pills, and Musk Baoxin Pills. It is also widely used in the perfumery, cosmetics, and food industries. In the future, it is expected to reduce the production cost of Double Throat and bring economic benefits to the company. Investment returns contribute the vast majority of profits. In 2008, the company auctioned for 35.53% of the shares of Jinsha Pharmaceutical. Jinsha Pharmaceutical's leading products such as 7-centipede tablets, wind relief tablets, and meridian activator tablets are all essential national medicines, protected varieties of national traditional Chinese medicine, and exclusive products of the country. From March to December 2009, Jinsha Pharmaceutical achieved net profit of 15.85 million yuan, and the company adopted equity law to confirm investment income of 5.63 million yuan. In 2010, the company confirmed that investment income increased by 249.8% year on year to 19.7 million yuan, accounting for 86.89% of the company's operating profit. Earnings forecasts and ratings. Assuming that investment income in Jinsha Pharmaceutical is still 19.7 million yuan per year in 2011 and 2012, the company's EPS for 2011 and 2012 is estimated to be 0.15 yuan and 0.16 yuan respectively. Based on the closing price of 18.4 yuan on March 15, the corresponding dynamic price-earnings ratio is 120 times and 116 times, respectively, which is too high. Maintain a “neutral” investment rating for the time being. Risk warning: 1. Risk of a single product; 2. Risk of price fluctuations of raw materials; 3. Risk of fluctuations in investment returns.