FY13 results fell far short of our and market expectations. Parkson's sales for FY13 increased 4.3% year on year to RMB 17,481.2 million; net profit for shareholders fell 58.4% year on year to RMB 353.6 million. Among them, the company's shareholders' net profit for the second half of FY13 was only RMB 28.9 million (RMB 324.7 million for the first half of the year). In addition, the company's gross margin on product sales fell 0.7 percentage points to 17.5% year on year, while same-store sales growth was negative 1.8% during the same period, which was lower than the company's guidelines. The difficult situation in FY13 will continue in the future. Although Parkson's same-store sales growth showed a month-on-month improvement in the fourth quarter of '13, it still clearly lagged behind its excellent peers. Based on the lackluster year-on-year same-store sales growth, continued spending for 6/5/6 new stores in FY13, 14/15, and the increase in operating expenses of around 10%-13% in FY14, we believe Parkson faced the same difficult situation in FY14. Cut profit forecasts and maintain “reduced holdings.” Although we are optimistic about Parkson's continued optimization of its store portfolio and efforts to boost operating efficiency, the harvest season has yet to arrive. We lowered our earnings per share for FY14 and FY15 to RMB 0.130 and 0.133, and forecast earnings per share for FY16 to be 0.148. The target price fell from HK$2.66 to HK$1.77, which is equivalent to 10.5 times the predicted earnings per share for 14 years, 10.3 times the predicted earnings per share for 15 years, 0.7 times the 14-year net market ratio, and 0.6 times the 15-year net market ratio.