2016H1 achieved net profit of 8.73 million yuan, and the revenue side decline narrowed. The company achieved revenue of 207 million yuan, a year-on-year decrease of 14.9%, and net profit to mother of 8.73 million yuan, a year-on-year decrease of 13.5%, equivalent to EPS of 0.03 yuan, a year-on-year increase of 5.4% after deducting non-net profit; Q2 achieved revenue of 95.85 million yuan, a decrease of 13.4%, and net profit of 790,000 yuan, turning a year-on-year loss into profit. Dragged down by the Russian market in the short term, the company's overseas business revenue declined significantly, down 36% year on year, while local business revenue fell 14%. Overall, the revenue decline in the first half of the year narrowed year on year. In terms of profitability, net profit was basically flat year-on-year. Among them, gross margin increased by 5.4 pct, mainly due to changes in revenue structure. At the same time, the company strengthened mink breeding in overseas farms through upstream resource integration, and achieved initial results in cost side control. Furthermore, the cost ratio increased by 4.8 pct during the period. Net operating cash flow for the first half of the year was -9.02 million yuan, with cash assets of nearly 350 million yuan as of Q2 accounts. The company expects a net profit change range of 558-9.57 million yuan from January to September. Seize the high ground of social e-commerce and actively promote the layout of high-quality traffic resources. By investing 30% of Youshe Technology's shares, the company is expected to use Weibo to accumulate social e-commerce experience and industry resources, and seize the social e-commerce highland. Since the signing of the “Strategic Cooperation Agreement” between Youshe Technology's WeChat platform and Weibo, the two sides have progressed smoothly in the construction and operation of social e-commerce platforms, Weibo products and operations, platform APIs, and big data analysis. Turnover and active users have maintained a relatively rapid growth trend, and are expected to be profitable in '16. At the same time, the company recently invested 5 million yuan to acquire 10% of the future shares of influencer brokerage companies, officially entering the field of beauty influencers. It has strong supply chain support capabilities and influencer economic chain integration capabilities in the future. Currently, it has more than 20 influencers with e-commerce monetization capabilities, represented by Niko Wang Yuepeng, and has an extensive fan base on the Weibo platform and opened up fan marketing and e-commerce operations. The company will take advantage of abundant traffic resources in the future to actively promote the influencer economy and become the beginning of the expansion of the mobile social e-commerce industry chain. It is expected to have good collaboration with Youshe Technology's big data analysis and WeChat platform. Risks suggest that traditional business continues to decline; raw material prices fluctuate sharply; and the performance of stock participation tenders falls short of expectations. Maintaining the purchasing rating company as a leader in the domestic fur industry has a strong operating foundation. Subsequent profit improvements will mainly rely on business structure optimization, promotion of industrial chain integration, and investment income contributions from share participation targets. At the same time, the prospects for social e-commerce layout and expansion are worth looking forward to. The company's non-public offering project was recently held at a reserve price of 14.33 yuan/share. At the same time, the majority shareholders promised to subscribe for 10%, demonstrating confidence in the company's future development. We expect the company to maintain the purchase rating for 16-18 EPS of 0.08/0.13/0.15 yuan (without considering fixed increase or dilution).