In 2012, the company achieved a total operating income of 1,378.7724 million yuan, an increase of 11.66% over the previous year; net profit attributable to shareholders of the parent company was 108,6291 million yuan, an increase of 16.64% over the previous year. Achieved earnings of 0.27 yuan per share. In 2012, the company plans to distribute a cash dividend of 0.8 yuan (tax included) for every 10 shares based on the total share capital, and transfer 10 shares to all shareholders for every 10 shares using the capital reserve fund.

In 2012, the company's catering revenue was 1312.99,900 yuan, up 7.03% year on year; trademark licensing and service fees were 388.9916 million yuan, up 631.52% year on year; other business revenue was 26.8813 million yuan, up 905.68% year on year.

The company's future highlights: 1) The company has established a multi-format development layout for restaurant business, fast food business, group meal business, and food processing business. Among them, with the exception of the restaurant business, the other three businesses are new business formats that the company will focus on developing. The company's goal for developing new business formats is to aim that within the next three to five years, the company's operating income from the new business format will reach about 80% of the company's total operating income. 2) Affected by the central government's “three public consumption” controls, the company's restaurant business was greatly affected. In the first quarter of 2013, the company predicted a loss of about 55-70 million yuan. The main reason for this was that the subsidiary's sales performance declined to varying degrees. In response, the company has taken a series of measures to shift its business focus from the middle to the middle and lower end in a timely manner, hoping to make up for losses in high-end restaurants through group meal business and fast food business. We will wait and see the effects after the transformation. 3) The group meal business will be the most important business for the company's future development: in July 2012, the company acquired 100% of Long Dehua's shares, marking the beginning of the company's entry into the group meal business. Currently, the company is undertaking close to 50 group meal projects in many cities in East China, North China, and Central China. The company's brand advantage, cost advantage and taste advantage brought by the central kitchen will be the core competitiveness of developing the group meal business. In the future, the possibility of further acquisition of group meal projects is not ruled out. 4) In August 2012, the company acquired Ajinomoto Company, marking the establishment of the company's fast food business. Through the company's integration with Ajinomoto, the revenue of each store grew well. In the future, the company will continue to speed up the opening of Ajinomoto stores in Beijing and Shanghai. 5) The food processing industry market is huge: it will provide consumers with finished and semi-finished dishes and fast food that can be enjoyed in the home kitchen with only simple processing and cooking.

The company's profit forecast and investment strategy: The company is speeding up the pace of capital operation. Through mergers and acquisitions, the development of multiple business formats will be the highlight of the company's performance growth in the future. However, considering the impact of the current “three public consumption” controls on the company, we lowered the company's 2013-2015 EPS to 0.24 yuan, 0.33 yuan, and 0.44 yuan respectively. The company's current stock price is 8.56 yuan, corresponding to 35 times, 26 times, and 19 times PE, and downgraded to a “neutral” rating.

Risk warning: “Three public consumption” controls the impact on the company, the risk that major shareholders will reduce their holdings, etc.