In the first half of 2011, the company achieved operating income of 159.04 million yuan, a year-on-year decrease of 20.6%; realized operating profit of 27.08 million yuan, a year-on-year decrease of 37.2%; and realized net profit attributable to the parent company of 31.07 million yuan, a year-on-year decrease of 33%. The basic earnings per share were $0.21. The company expects net profit to drop by less than 30% year-on-year in January-September. There will be no profit distribution in the first half of the year. Earnings for the first half of the year were significantly lower than expected. The Shanghai World Expo in the first half of '10 led to a sharp increase in demand for security equipment in East China. The company received orders for security monitoring products from the World Expo and the Shanghai Metro line. There were no obvious driving factors in the first half of this year, which led to a sharp drop of 51% in revenue in East China; revenue performance in other regions was basically normal; and overseas market revenue fell 20%, speculations related to the slow recovery of overseas economies and delays in delivery of some projects. Overall, with the security industry still maintaining rapid growth, the company's progress on some contract projects has slowed down due to macro-austerity policies, yet the expansion and construction of the marketing system has yet to bear fruit, and revenue performance in the first half of the year was significantly lower than expected. It is still expected to gain strength in the second half of the year. The company will continue to make progress in the Shandong, Anhui and other markets in the second half of the year. It is expected that the adverse factors of the slowdown in demand in the Shanghai area will be successfully eliminated, and revenue growth in East China will resume. Projects suspended in overseas markets will also resume in the second half of the year. The company will enter the growth phase in the second half of the year, and we expect the company's annual revenue to still grow by about 7.5%. The profitability of the product has remained stable. By product, the main business monitoring equipment revenue reached 136 million yuan, down 13% year on year. Changes in product structure increased gross margin by 1.32 percentage points to 57.8%; optical transceiver revenue was 21.82 million yuan, down 48% year on year, and gross margin also dropped sharply by 5 percentage points to 57.5%; overall gross margin was 57.9% for the first half of the year, and the product profit level remained at a stable high level. Expenses for sales and management increased significantly over the same period last year. The company's sales and management expenses rate is higher than that of peer listed companies. In the first half of the year, the company maintained high investment in R&D and marketing. Sales and management expenses increased by 34% and 4% respectively over the same period, exacerbating the decline in profits. Financial expenses benefited from abundant overfunding, achieving revenue of 21.98 million yuan. Profit forecasts and investment ratings. We lowered our profit forecast for the company. The EPS from 2011 to 2013 is estimated to be 0.58 yuan, 0.84 yuan, and 1.13 yuan, respectively, and the corresponding PE is 41 times, 28 times, and 21 times, respectively. The company has a complete product line, high-end product positioning, and strong competitiveness in the security field. Benefiting from the definitive development of the security industry, the company's long-term growth prospects can still be expected. In the short term, the company is still in the investment period, has no advantage in valuation, and is temporarily given a “neutral” investment rating.