For the whole of 2012, the company achieved operating income of 1.719 billion yuan, down 14.7% from the same period last year; operating profit loss of 300 million yuan (21.8848 million yuan in the same period last year); net profit loss of 320 million yuan belonging to the owner of the parent company (12.4654 million yuan in the same period last year); and basic earnings per share-0.3014 yuan.

Pulp and paper, optoelectronic business declined, revenue and gross profit margin declined. The company is mainly engaged in the production, marketing and trade of paper bag paper, pulp, natural pulp board, paperboard and corrugated paper products, paper products, optoelectronic products, pharmaceutical products, forest products and other products. In 2012, the company completed a business income of 1.302 billion yuan for all kinds of pulp, paper, cardboard and other paper products, a decrease of 18% compared with the same period last year, mainly due to the imbalance between supply and demand in the packaging paper industry, such as paper bag paper and corrugated paper, and a decrease in sales compared with the same period last year. At the same time, due to the decline in selling prices and the limited decline in the price of raw materials, the gross profit margin of the products fell by 6.5% to-2.1%, and the overall income of paper and pulp products for the whole year exceeded their income. In terms of optoelectronic products, the completed operating income was 130 million yuan, down 24% from the same period last year, and the gross profit margin simultaneously fell 2.5% to 19.9%. The revenue scale and product profitability increased significantly due to the slow recovery of the international IT industry, financial expenses and asset impairment losses. During the reporting period, due to the triple effects of the company's interest capitalization after the completion of the technical renovation project, the increase in the inventory of finished goods and the increase in bank borrowing rates, the company's financial expenses increased by 136% year-on-year, an increase of nearly 63 million yuan. At the same time, due to the heavy inventory backlog of raw materials and finished products and the decline in market prices, the company set aside 34 million yuan for inventory decline and 114 million yuan for fixed assets impairment provision for high-strength corrugated production lines affected by insufficient operating rates. the two combined asset impairment loss of 148 million yuan, has become another important factor in the current performance loss.

With the increasingly fierce competition in packaging paper, the pulp efficiency of new products still needs to be improved, and there is a long way to go for future development. At present, the company's extensible paper bag paper products have traditional advantages, but local competitors and imported products form a continuous impact, which hinders production capacity; high-strength Kraft cardboard and high-strength corrugated medium are compared with similar domestic large enterprises, the scale is not outstanding, the profitability is weak, we judge that the company's packaging paper business is difficult to significantly improve profits in the short term. Although the new product pulp has a certain competitive advantage in equipment, quality and cost control after it is put into production, the continuous weakness of the downstream viscose industry market makes it difficult to give full play to the benefits of the whole production system. Based on the main industry of pulp and pulp, the company changes the mode of development and adjusts the final implementation effect of the product structure strategy remains to be seen. Profit forecast and investment rating. In view of the continued losses in the company's main business, the company maintains its "neutral" investment rating and does not give profit forecasts for the time being.

Risk hint. The risk of a sustained downturn in supply and demand in the packaging paper and pulp industry.