Event review: The company released its report for the third quarter of 2017. From the beginning of the year to the end of the reporting period, it achieved operating income of 114 million yuan, a decrease of 0.45% over the same period of the previous year; realized net profit attributable to shareholders of listed companies of 0.23 million yuan, an increase of 4.15% over the previous year; and basic earnings per share were 0.25 yuan/share, a decrease of 21.89% year on year. Key investment points: Performance rebounded in the third quarter, showing a steady state. The company's poor performance in the first half of the year was mainly due to the fact that the delivery and acceptance of the product order contract signed by the company in 2017 was concentrated in the second half. As a result, operating income decreased compared to the same period last year. The main reason for the expected decline in net profit compared to the same period of the previous year is that as the scale of the company's business increases, the absolute amount of the company's accounts receivable has increased rapidly, and bad debt losses accrued in accounts receivable have increased accordingly. However, since the company's customers are mainly the domestic military, domestic A-share listed companies and their subsidiaries, etc., the risk of recovering accounts receivable is low, and there have been no bad debts in accounts receivable up to now. Judging from the third quarter's performance, the company achieved operating income of 0.29 million yuan, an increase of 7.32% over the same period last year; net profit attributable to shareholders of listed companies was 0.06 billion yuan, an increase of 77.12% over the previous year. The performance has rebounded compared to the interim report, showing a stable state of affairs. There are many orders for aero engine electronic products, focusing on subsequent inertial guidance product order confirmation. The company's aero engine electronic products are mainly aero engine parameter collectors and aero engine electronic control systems. The application of electronic engine control system technology in China is still in its infancy, and it is one of the key aviation technologies that continue to break through in China. In the first half of the year, revenue from aero engine electronics products was 19.064 million yuan, up 120.67% from 8.637,600 yuan in the same period last year, showing an overall upward trend. The main reason is that in 2017, the company received a large number of contract orders for aero engine electronics products, and delivered to customers as scheduled and passed the inspection according to the order delivery schedule. At the same time, the number of flight control computers among aero engine electronic products increased in 2017, and the sales price of this product is higher than that of other types of aero engine electronic products. Inertial navigation technology is mainly used in the military field. It is currently the only navigation method that is both autonomous navigation and can provide dynamic and complete information. It is an irreplaceable navigation method in the field of air navigation. The industry has high market entry barriers and technical talent barriers. The company is one of the earliest domestic enterprises to successfully develop and apply high-precision laser Jetlink inertial navigation systems, focusing on the confirmation of the company's subsequent orders for inertial navigation products. Risk Warning: Military Order Confirmation Risks, New Business Growth Slows Down