The performance was in line with expectations. The company achieved revenue of 574 million yuan in 2009, an increase of 36% over the previous year; achieved net profit of 116 million yuan, an increase of 129% over the previous year, and achieved earnings of 0.97 yuan per share, which was better than our forecast of 0.95 yuan (already raised in accordance with the pre-performance increase announcement). The company did not distribute cash dividends and did not increase share capital in 2009. High-speed rail orders have been delivered one after another, and product gross margin has increased dramatically, which is the driving force for growth. CNC gantry machine tools, including high-speed rail CRTSII rail plate gantry milling, achieved sales of 366 million yuan throughout the year, an increase of 147% over the previous year, the revenue share increased from 35% to 64%, and the share of ordinary machine tool revenue fell from 32% to 13%. The company's consolidated gross margin in 2009 was 34.85%, an increase of 10.02 percentage points over the previous year. Among them, the gross margin of CNC gantry machines increased by 6.01 percentage points to 41.6%. The average gross profit margin of ordinary machine tool products is 13.76%, which is basically the same. Growth will continue to be steady next year. The market is worried that orders for high-speed rail will decline next year, and the company's performance will grow negatively next year. We believe that although high-speed rail orders may drop from 300 million yuan to about 150 million yuan next year, they will still maintain an 11% increase next year. The sources include: 1. Revenue from large CNC gantry machines will increase by more than 100 million yuan; 2. Orders for ordinary machine tools will increase by more than 80 million yuan; 3. The revenue from investing in IPO production capacity for CNC circular grinders and roller grinders will increase by more than 50 million yuan; 4. The parallel motion machine tool and processing business will begin to contribute revenue. The processing business was the main source of growth in 2011. The company is positioned as a large-scale and heavy CNC machine tool manufacturer at the international advanced level, and is also actively entering the field of large-scale precision forging and casting parts processing for ships, nuclear power, mining machinery, etc., which has a wider space. The company publicly issued no more than 35 million shares, and raised 350 million yuan and was approved by the Securities Regulatory Commission. It cooperated with Germany's Heath Zhuangming to manufacture a CNC gantry mobile boring and milling center representing the international advanced level, a φ320 CNC floor-mounted boring and milling machine, and a 16-meter CNC six-axis gear hobbing machine. The company has established Huadong Heavy Industries as a joint venture with Heath Zhuang Ming. The company holds 75% of the shares and has a total investment of 600 million yuan. It mainly undertakes the production and processing of large and precision parts in domestic and foreign nuclear power fields. We expect Huadong Heavy Industries may begin trial production in the third quarter of 2010, and the gross margin of the processing business may be as high as 50%. Joint venture cooperation projects help the company to advance R&D and manufacturing technology to a world-class level, and subsequent profitability and high growth are worth looking forward to in the long term. Maintain an “Overweight” rating. We maintain profit forecasts of 1.05 yuan and 1.51 yuan from 2010 to 2011, achieve rapid growth of more than 30% in the next two years, and the short-term valuation is reasonable. As a high-end CNC machine tool manufacturer benefiting from the construction of high-speed rail, wind power, and nuclear power, the company will gain broad development space by actively entering the field of parts processing. Next year it will be at an inflection point in performance growth. We are optimistic about the company's medium- to long-term growth and maintain a “gain” rating.