Incident: Huawen Media released its 2012 annual report. In 2012, we achieved operating income of 4,092 billion yuan, an increase of 7.95% year on year; net profit attributable to shareholders of listed companies was 269 million yuan, an increase of 5.35% year on year. Earnings per share were $0.198. The distribution plan is to distribute cash of $0.20 (tax included) for every 10 shares to all shareholders. Comment: Profit growth in the fourth quarter was better than in the third quarter. The revenue for the fourth quarter of 2012 increased 18.99% year-on-year to 1,315 billion yuan, and net profit attributable to shareholders of listed companies in the fourth quarter of 2012 increased 6.1% year-on-year to 73.39 million yuan. Both revenue and net profit growth rates were higher than in the third quarter. The newspaper and online business grew, and the company's communications and culture industry achieved revenue of 2,942 billion yuan in 2012, an increase of 6.28% over the previous year. The subsidiary Huashang Media is the sole agent for the operation business of Huashang Newspaper's “Six Newspapers and Five”. The “Six Newspapers” operated by the company include four metropolitan newspapers: Xi'an “Huashang Daily”, Changchun “New Culture Daily”, Shenyang “Huashang Morning News”, and Chongqing “Chongqing Times”. In 2012, Huashang Media achieved operating income of 2529.96 million yuan and net profit of 365.02 million yuan, of which the revenue and profit of Huashang Network increased dramatically. Times Media, which holds 84% of the company's shares, has exclusive management rights for businesses related to “Securities Times” commercials, consulting and planning of financial information, design, production, and agency publication for a period of 30 years until July 31, 2036. Times Media achieved revenue of 435.58 million yuan and net profit of 59.95 million yuan in 2012. The return on investment saw return in 2012, the gas production and supply industry achieved operating income of 607.33 million yuan, an increase of 5.81% over the previous year. The subsidiary Hainan Minsheng Pipeline Gas Company achieved net profit of 44.55 million yuan in 2012. The company achieved investment income of 60.16 million yuan in 2012. The subsidiary Shanghai Hongli continued to increase investment projects, track and manage already invested projects, and achieve profits by relying on equity investment income. The company that acquired Radio International's internal broadcasting business announced in January 2013 that it had acquired 100% of Guoguang Guangrong's shares. The total share transfer price was 680 million yuan. Guoguang Guangrong's current business is mainly the general agent for the advertising management of China Radio International's three domestic broadcast frequencies. It is an economic entity that realizes the internal broadcast frequency market value for international stations. According to the agreement, Guoguang Guangrong pays advertising expenses to Guoguang Holdings according to 33% of the annual revenue from the domestic radio frequency advertising business operating on international stations, and ensures that the advertising expenses paid for each full year are not less than 45 million yuan. The license period is 30 years (that is, from January 1, 2011 to December 31, 2040). Guoguang Guangrong achieved operating income of 155.98 million yuan, net profit of 47.63 million yuan, total assets of 168.81 million yuan and net assets of 87.78 million yuan at the end of 2012. Guoguang's radio advertising business includes three sets of internal frequencies for international stations: News Radio (News Radio), Hit FM (Hit FM), and Easy FM (EZ FM). The above three broadcast frequencies already have strong brand influence in developed cities such as Beijing and Shanghai. Launching the broadcasting business in more cities will bring future growth. The transferor's promises to Guoguang Guangrong's net profit attributable to the owner of the parent company after actually deducting non-recurring profit and loss for the five fiscal years from 2013 to 2017 are: 61.45 million yuan, 72.27 million yuan, 8.54 million yuan, and 8.54 million yuan, respectively. After completing the purchase and holding Guoguang Glory, the company will actively cooperate with international stations to expand the coverage of domestic broadcast frequencies, thereby bringing about a continuous increase in revenue. The frequency of Global News's additions to Tianjin and Shanghai in 2013 is expected to be determined. The additional frequencies for 2014 and 2015 will be Harbin, Dalian, Chengdu, Zhengzhou, Wuhan, Shenyang, Hefei, Nanning, Qingdao, Fuzhou, Nanchang, Kunming, Changchun, and Wuxi. The company announced its “all-media” strategic position. Subsequent mergers and acquisitions can be expected that the company will actively build an all-media business structure through internal resource integration and external incubation of mergers and acquisitions. The company's “big culture” strategic positioning is to gradually form a strong business and media service brand covering all terminals in the modern cultural industry system with excellent commercial operation capabilities and media service capabilities, and build a large-scale media group with strong profitability and sustainable development. According to the development strategy announced by the company, the company plans to enter the study abroad service industry in addition to the existing business and the broadcast business that has already been announced for acquisition. Entered the film and television industry chain, became a video content provider, and formed effective cooperation with Internet TV in Guangdong and China. Combining license resources such as Internet TV, online video, and mobile TV from international stations, Internet companies that focus on vertical business models, including the Internet TV industry, mobile Internet industry, vertical e-commerce industry, and online game industry. Intervene in the IoT industry chain. Invest in companies with exclusive advertising media resources, excellent professional teams, and brand reputation resources, including media resource advertising companies, 4A advertising companies, and digital marketing companies. Implement overseas mergers and acquisitions in the media industry. Implement equity financing and debt financing in a balanced manner. Actively adopt equity financing and strive to implement it every two years to rapidly increase the size of the company's net assets. The profit forecast and rating take into account the new broadcast advertising business brought by the acquisition of Guoguang Guangrong. We expect the company's EPS from 2013 to 2015 to be 0.28 yuan, 0.33 yuan, and 0.38 yuan, respectively, corresponding to the current stock price, and price-earnings ratios of 24 times, 21 times, and 18 times, respectively. The company is currently suspending trading and planning major asset restructuring matters involving the purchase of assets through a non-public offering of shares, and maintains a “prudent recommendation” rating for the time being. Risks indicate capital requirements for subsequent foreign mergers and acquisitions. Newspaper and radio advertisements may be influenced by new media.