Items:

According to the company's three-quarter report, Q1-Q3 achieved 833 million yuan in operating income in 2015, down 4.62 percent from the same period last year, and the net profit attributed to shareholders of the parent company was 30.1852 million yuan, up 0.29 percent from the same period last year. Of this total, the operating income in the Q3 quarter was 260 million yuan, down 16.88% from the same period last year, and the net profit belonging to the shareholders of the parent company was 7.9082 million yuan, down 8.10% from the same period last year.

Peace viewpoint:

Earnings were lower than expected due to lower-than-expected IPOs: lower-than-expected earnings due to lower-than-expected financial progress in the transition supply chain because the stock market dragged down the IPO plan.

The traditional business remains stable, and the future growth comes from raising investment projects: the traditional main business is the research, production and sales of home appliance appearance composites (PCM/VCM). In 2011-2012, due to increased competition, net profit decreased significantly, falling by 35.06% and 59.81% respectively compared with the same period last year. Net profit has remained stable since 2013, with a year-on-year increase of 0.29% in the first three quarters of this year. The company plans to invest 558 million yuan in the annual production of 100000 tons of digital printing PCM production line, which will be the first domestic industrial production line of digital printing PCM. It is expected that Zengji will be implemented at the beginning of 2016, which will contribute to the performance in 2017, and will double the current profit after full production.

Undercounting the provision for impairment will lead to a turnaround from loss to profit, and the provision for impairment will be reversed in 2017: the company expects the net profit of shareholders of listed companies to be 2800-34 million yuan this year, up from-121 million last year, not because of the growth of the main business, but because of undercounting the provision for impairment. Last year, the company failed to invest in Jinyingma equity, with an impairment reserve of 141 million yuan, resulting in a loss. According to the agreement, this part of the impairment will be reversed in 2017, and the difference between the transfer and the book value is about 142 million yuan (219 million yuan for the transfer + interest-book value 77 million yuan) as the investment income, so the net profit in 2017 will increase significantly.

Supply chain finance is expected to contribute performance next year: the company plans to increase no more than 2.9 billion of the transition supply chain finance, including supply chain information management platform, commercial factoring and financial leasing, according to the current CSRC hearing progress, is expected to be approved for implementation early next year, supply chain finance is expected to contribute to performance next year.