Content of the announcement:

In 2012, the company's income was 361 million yuan, down 0.36% from the same period last year; the operating profit was 67.43 million yuan, up 18.03% from the same period last year; the net profit belonging to the owner of the parent company was 50.3 million yuan, up 5.27% from the same period last year; and basic earnings per share was 0. It is proposed to pay a dividend of 0. 5% for every 10 shares. 33 yuan. In the first quarter of 13 years, the revenue was 93.3 million yuan, down 11.39% from the same period last year, and the net profit was 19.12 million yuan, up 3.91% from the same period last year.

Analysis conclusion:

The performance is slightly lower than expected, and the growth rate of wine business revenue keeps pace with that of the industry.

In 2012, the company's operating income fell by 0.36% year-on-year, and net profit increased by 5.27% year-on-year, slightly lower than we expected. Of this total, the revenue from the grape business was 285 million yuan, an increase of 14.05% over the same period last year, basically synchronized with the industry; the income from malt processing was 41.73 million yuan, down 47.03% from the same period last year, which was lower than our expectation; and the revenue from the licorice tablet business was 34.54 million yuan, an increase of 2.63% over the same period last year.

The comprehensive gross profit margin increased significantly, and the expense rate increased compared with the same period last year.

The gross profit margin of the company in 2012 was 62.13%, up 5.5 percentage points from the same period last year. On the one hand, the gross profit margin of the wine business was 0.44 percentage points higher than the same period last year; on the other hand, the revenue of the malt processing business with low gross margin fell sharply in 2012, resulting in a significant increase in the share of revenue from wine and licorice tablets. During the period, the expense rate rose 3 percentage points year-on-year to 39.39%, mainly due to the company's 12-year marketing efforts, significant growth in promotion expenses and employee salary, and 4% increase in sales expense rate compared with the same period last year.

Barley malt income continues to shrink and losses are serious.

The company's 12-year malt processing business continued the sharp decline in 2011. On the one hand, sales declined due to the demand of the industry, on the other hand, the decline in imported beer prices also had an impact in the first half of the year. Gross profit margin fell 15 percentage points to-5.08% compared with the same period last year. The annual loss is estimated at 20 million to 30 million yuan. The company's annual depreciation of fixed assets of malt business is more than 10 million yuan. With the continuous decline of income, the possibility of the company's malt business divestiture is also increasing.

Maintain the recommended rating

Adjust the company's 13-15 EPS forecast to 0. 5% respectively. 19 yuan, 0. 29 yuan and 0. 5%. The profit forecast of 37 yuan corresponds to the current stock price PE of 47 times, 35 times and 25 times respectively. The pressure of short-term valuation and slowing industry growth will affect the company's stock price performance. Caution is recommended, but in the medium and long term, we are still optimistic about the breakthrough of the company's wine in the market outside the province.

Risk hints: market expansion is not up to expectations; macroeconomic downside risks.