Since we expect tungsten prices to oscillate at the bottom in 2009, the company's earnings per share for 2009 will be 0.43 yuan, giving the company a cautiously recommended investment rating.
Xiamen Tungsten Industry: 2008 Annual Report Review
The company achieved consolidated operating income of 4.947 billion yuan, an increase of 6.96% over the previous year; realized a consolidated net profit attributable to shareholders of listed companies of RMB 202.61 million, an increase of 1.08% over the previous year. Excluding the real estate business, the company realized a consolidated operating income of 4.022 billion yuan and a combined net profit attributable to shareholders of the listed company of 112.29 million yuan, down 2.33% and 38.74% respectively over the same period of the previous year. The main reasons for the net profit reduction compared with the budget: First, due to the global economic recession, the major raw materials such as tungsten, molybdenum, nickel, cobalt and rare earth fell sharply in the second half of the year, especially in the fourth quarter, which caused the product price to dive, although the company has already faced the market trend. The correct judgment was made in advance and the stock of raw materials and products was minimized. However, due to the long industrial chain of the company, the stocks still included in the products were still large, and the resulting price loss was not spared. In the fourth quarter, the total inventory depreciation loss was accrued. Up to 46.63 million yuan; second, due to the adjustment of the national macro-policy, some products export tax rebate reduction, cancellation, and even increase export tariffs, affecting profits of 48.37 million yuan.