The year-on-year increase in performance was in line with company expectations: during the reporting period, the company achieved operating income of 159.9 million yuan, up 26.31% year on year, and the company realized net profit attributable to the parent company of 30.1 million yuan, equivalent to EPS of 0.22 yuan, up 10.13% year on year. The main reason for the increase in performance is that the company's fund-raising project of 20,000 tons of high-dispersion white carbon black projects reached production, contributing 10.45 million yuan in net profit throughout the year. The total sales volume of white carbon black, the main product, was 21,852 tons, an increase of 13% over the previous year, which was lower than the increase in sales revenue. The main reason was that the average price of the company's products increased year on year. Due to weak demand, the burden on new projects is not high: in 2012, the company's TMG product revenue fell 37%; in 2012, the company's TMG product revenue fell 37%; furthermore, progress in high-dispersion white carbon black for green tires fell short of expectations. Due to poor demand, the two new projects built by the company did not have a high operating rate. The 20,000 ton fund-raising project achieved a net profit of only 10.45 million yuan throughout the year, and the 30,000 ton overfunded project achieved a net profit of only 650,000 yuan throughout the year. The production capacity of the white carbon black actually built by the company in 2012 has reached 66,000 tons, and the actual output is only 22,000 tons. The load is not high. However, the completion and refurbishment of the new project has also led to an increase of 7 million yuan in depreciation expenses that the company needs to accrue. The domestic green tire labeling law is about to be introduced: China's green tire labeling law will basically refer to the EU labeling law system. In February 2012, the Ministry of Industry and Information Technology commissioned the Rubber Industry Association to formulate China's green tire self-regulatory standards and non-mandatory tire labeling classification methods, as well as a voluntary classification system for green tire products. Relevant standards and regulations will be introduced before the end of 2013, and it will accelerate the upgrading of the green tire industry's self-regulatory standards to industry standards and national standards, adopting voluntary, then mandatory steps. It is expected that the mandatory green tire classification label law will begin to be implemented by 2017. Among them, in the non-mandatory grading stage, 50% of tire companies seeking to achieve green tire production capacity by 2015, and of these, no less than 50% of the production capacity is green tires, which means 25% of the total production capacity will be green tires. Investment advice: increase holdings - A investment rating, target price of 8 yuan for 6 months. We expect the company's revenue growth rates from 2013 to 2015 to be 16.5%, 30%, and 30%, respectively, net profit growth rates of 24.8%, 31.4%, and 30.4%, respectively, increase holdings - A investment rating, and a target price of 8 yuan for 6 months, which is equivalent to a dynamic price-earnings ratio of 28 times that of 2013. Risk warning: demand falls short of expectations