The company's 1Q2018 revenue increased 3.07% year on year, and net profit to mother increased 75.05% year on year. On April 27, the company announced its 2018 quarterly report. 1Q2018 achieved revenue of 3.816 billion yuan, an increase of 3.07% year on year, less than 4.74% increase in 4Q2017. Achieved net profit of 65 million yuan, equivalent to fully diluted EPS of 0.13 yuan, an increase of 75.05% over the previous year. Net profit without return to mother was 57 million yuan, an increase of 83.94% over the previous year, and the performance exceeded expectations. The main reasons why the net profit growth rate of 1Q2018 was higher than the revenue growth rate: 1) gross margin increased 0.58 percentage points over the same period of the previous year, 2) financial expenses were 53.3737 million yuan, down 17.57% year on year, and the financial expenses ratio was 1.40%, down 0.35 percentage points from the same period last year, mainly due to a decrease in corporate loans. The comprehensive gross margin increased by 0.58 percentage points, and the expense ratio decreased by 0.31 percentage points. The revenue of 1Q2018's main business was 3.577 billion yuan, an increase of 2.51% over the previous year. Among them, the operating revenue of department stores/ large supermarkets and shopping centers was 23.23/ 10.25/ 229 million yuan respectively, up 1.09%/2.55%/19.37% year-on-year respectively. 1Q2018's consolidated gross margin was 17.71%, up 0.58 percentage points from the same period last year. The 1Q2018 company's expense ratio for the period was 14.13%, down 0.31 percentage points from the same period last year. Leading retail in Shandong. The company's revenue growth rate is picking up, and short-term performance is difficult to grow significantly. The company is a large-scale commercial retail enterprise based in Shandong and taking into account the development of surrounding regions outside the province. It covers the three business formats of department stores, large integrated supermarkets, and shopping centers. As of the end of March 2018, the company had 129 stores, including 126 stores in 13 cities in Shandong Province, and 3 stores in Shijiazhuang, Baoding, and Zhangjiakou, Hebei. In addition, the company was entrusted with managing 49 unlisted stores under Shandong Ginza Mall Co., Ltd. Since 2017, the department store industry has generally recovered, and the company's revenue growth rate has picked up, but as competition in the retail market in Shandong continues to intensify, it is difficult for short-term company performance to increase significantly. Profit forecasts were raised to maintain the revenue growth rate of “neutral” rated companies, and expenses were effectively controlled. 1Q2018 performance exceeded expectations. We raised the company's EPS forecasts for 2018-2020 to 0.14/ 0.14/ 0.14 yuan (previously 0.05/0.06/0.07 yuan), respectively. The company's price-earnings ratio is at a high level, maintaining a “neutral” rating. Risk warning: Industrial competition in Shandong is intensifying, and the risk of cross-regional expansion