The company expects to open 19 new restaurants in 2013, but plans to close 8 restaurants at the same time. Consumption per capita still declined markedly year on year in the second half of '13, but passenger traffic improved again compared to the first half of '13. We expect same-store sales to grow -9.2% in '13. We expect the company to both record losses in the second half of '13 and '13 due to poor sales in the same store compared to expectations and a one-time loss due to the closure of restaurants. We expect the company to open 21 new restaurants in 2014, of which more than half will be the “South Restaurant” with the highest profit margin. On the other hand, we also expect the company to close at least 2 loss-making restaurants in 2014. We expect per capita consumption to decrease by 1.1% year on year in 2014, but passenger traffic will increase by 4.6%, so we expect same-store sales growth to be 3.4% in 2014. However, this moderate growth forecast was not enough to drive the company's very significant net profit growth in 2014. We expect the company to lose RMB0.002 per share in 2013, while net profit per share for 2014 and 2015 would be RMB0.009 and RMB0.084 respectively. We believe that the growth momentum of the domestic mass catering market is still there, and that after the company changes its strategy, same-store sales growth will stop falling and pick up. The continued increase in the contribution of “Nan Xiao Guan” and the continued increase in passenger traffic will drive the company's net profit to increase significantly in 2015. We maintain Xiaonanguo's “buy” rating, and the target price of HK$1.65 remains unchanged. The target price is 20% off the valuation calculated by our DCF model, which is also equivalent to 15.2 times the company's 15-year price-earnings ratio.