event. The company announced its 2016 three-quarter report. The first three quarters of 2016 achieved revenue of 1,339 million yuan, a year-on-year increase of 5.05%; realized net profit of 128 million yuan, a year-on-year increase of 10.15%; net profit after deduction of net profit of 116 million yuan, an increase of 21.86% over the previous year; and EPS of 0.11 yuan. The third quarter alone achieved revenue of 377 million yuan, up 2.8% year on year; net profit for the third quarter was 29.9047 million, up 192.52% year on year. Brief review. The steady growth rate of revenue growth in the first three quarters still benefited from the first quarter. The company's revenue for the first three quarters reached 1,339 billion dollars, up 5.05% year on year, and a slight increase of 2.8% year on year in the third quarter alone. Currently, the steady increase of 5.05% in the first three quarters is mainly benefiting from the 10.6% increase in revenue in the first quarter. Among them, the overall growth rate of soy sauce is about 4% and 5%, and the growth rate of vegetable oil is about 10%. The large single product strategy implemented by the company. The sales volume of the two major single products, fresh noodles and original brewing, is basically the same as last year. The growth in fresh noodles is in line with expectations, and the growth is better than that of the original brewing. The sharp increase in net profit for the third quarter alone was a low base figure for the same period last year. The company's net profit for the first three quarters increased 10.15% year on year and after deduction increased 21.86% year on year. Investment income (time deposits and wealth management products) for the third quarter decreased by 110 million yuan, while the company's net profit for the third quarter increased by 192.52% year on year, mainly due to the company's confirmed equity investment losses in the same period last year. Net profit for the third quarter of 2015 was 32.32 million, a low base figure. Overall, the growth rate of net profit of the mother was lower than the growth rate after deduction. The alternating influence of old and new factories has gradually been eliminated, and gross margin has increased. The overall gross profit margin for the first three quarters was 28.14%, down 1.04pct year on year; the gross profit margin for the third quarter was 28.91%, up 1.35 pct year on year. Although the increase was small, it reflected that the negative impact of the company's transition between new and old factories and capacity transitions on gross profit was gradually eliminated. At present, the old factory has stopped production, and the new factory is gradually increasing in volume, yet it has not been fully utilized; the old factory's original 120,000 tons, all of which have been converted to the new factory, and the quality of the company's products is also gradually improving. The new plant has added 200,000 tons of production capacity. Considering the different soy sauce fermentation cycles, the wrong production can basically reach 400,000 tons in the future. If the new plant is capable of full production in the future, gross margin will also increase. Sales expenses continued to decrease in the first three quarters, and sales expenses increased significantly in the third quarter alone. The company's sales expenses fell 17.54% in the first half of the year, and sales expenses in the first quarter also fell 8.16% year on year. As a result, overall sales expenses in the first three quarters of 2016 were still lower, but sales expenses for the third quarter alone increased by 22.8% year on year. On the one hand, the increase in sales expenses in the third quarter was mainly due to the promotion of vegetable oil. The company expanded distribution channels in the vegetable oil market and achieved sales through some channels in Sichuan and Hubei except Hunan and Jiangxi; on the other hand, the cost of entering first-tier supermarkets for soy sauce was the source of the rest of the increase in sales expenses. Profit forecasts and valuations. The company's condiment business remains at the same level as the industry average, and is investing more heavily in vegetable oil. The end of the year depends on the entry of the company's first-tier supermarkets. The convertible bonds previously issued by the company entered the exchange period on October 28, 2016. The upper limit of the number of shares to be exchanged based on the current exchange price of exchangeable bonds is 127 million shares. At that time, the company's controlling shareholders may reduce their holdings of the company's shares due to the excellent investment of the company due to the exchange of shares. The three-year issuance period of this convertible bond locks in future stock exchange prices, stabilizes the company's market value, actually supplements the company's capital, and enhances financing capacity; on the other hand, it also lays the foundation for the company's future capital operations such as mergers and acquisitions. The 2016/2017 EPS is predicted to be 0.15, 0.2 yuan, and the rating will increase holdings. The target price will not be given yet.