Report Summary: A summary of the interim report. The first half of '13 achieved total operating income of 6.534 billion yuan, a year-on-year decrease of 0.84%; net profit attributable to the parent company was 10.14 million yuan, reversing losses year-on-year. Net profit was 26.58 million yuan after deduction, a sharp reversal of losses over the previous year. EPS of 0.0254 yuan was achieved in the first half of the year. Improve promotion methods, strengthen member management, and significantly increase gross margin to 21.51%. The company changed the previous extensive unified price reduction and distribution of leaflets and other promotional methods to strengthen member management and provide preferential member policies in a more targeted manner, thus avoiding the leakage of promotions to less sticky customers, reducing unnecessary sacrifices in gross profit, and greatly increasing the gross profit margin. On a quarterly basis, the company's gross margin for the second quarter increased by 0.97 percentage points to 21.51% year on year, which is at a high level in the supermarket industry. Furthermore, the increase in gross margin is also related to the company's increase in the proportion of site subleases. Cost control has been greatly strengthened, and sales and management expenses have been reduced by 46.72% and 49.85%, respectively. The company further strengthened cost control and reduced unnecessary promotional fees. In the second quarter, the sales expenses ratio dropped sharply by 1.9 percentage points to 16.55%, and the management expenses rate fell 0.56 percentage points to 3.91%. The company's sales expense ratio is still high in the same industry. In the future, through new stores to divert employees, strengthen performance evaluation, etc., there is still plenty of room for the sales expense ratio to decline. The opening of new stores tends to be cautious, and the expansion process has slowed down somewhat. In the first half of the year, the company opened 5 new stores, with an area of 88,469 square meters, and closed 1 store. By the end of the period, there were 124 stores. Due to the lengthening of the new store cultivation period, competition intensified, and the company was more cautious in choosing locations for new stores, while dynamically adjusting to reverse losses and hopeless stores (losses for more than three years). The growth rate of same-store stores has generally declined, mainly due to a marked decrease in passenger flow. In the first half of the year, same stores in South China, the company's main revenue contributor region, fell 6.14%. Although customer unit prices increased, a drop in passenger traffic of more than 10% still led to negative same-store growth. On the other hand, the supermarket business in South China is close to saturation on time, and newly opened stores will crowd out the share of the original stores. At the same time, due to the return of workers in South China to third- and fourth-tier cities, it is expected that it will be difficult for the same store to perform in the short term. Profit forecasts and investment advice. We are optimistic about the company's business strategy of increasing gross profit, controlling expenses, and prudently expanding. Although there were still losses in the second quarter, (1) there was a marked improvement over the same period last year. (2) Excluding losses from store closures, it is expected that losses will be reversed in 13. The EPS for 13-15 is expected to be 0.10, 0.19, and 0.31 yuan, respectively, giving it an “increase in holdings” rating for the first time.