HubeiYiHuaCo.,LTDprofile

HubeiYiHuagroupislocatedinthedevelopmentoftourisminyichangcityworld-class,waterandelectricity,mysteriousbeautifulscenery,thethreegorgesimposingthethreegorgeswaterconservancyhubproject,gatheredfocusallovertheworld'seyes.

YiHuagroupofelite,andsetthegathereliteofheavenandearth,allofaboveoftheweather,andadvantage.Shanghai-chengduexpressway,theYangtzerivergoldwaterwaycrossesthething,JiaoLiurailway,318nationalhighwayZongTongnorthandsouththroughYiHuaindustrialpark,thethreegorgesinternationalairporttotheworld,andbuildtheYiHuagroupwater,land,andairsolidtransportationdevelopmentnetwork,YiHuagroupisfromheretothenational,totheworld.

Thecompanyproductcoverschemicalfertilizer,chemical,thermalpower3bigfields10varieties,capableofproducing400000tonsofsyntheticammonia,600000tonsofurea(including250000tons),ureagranules300millionKWH,30000tonsofpentaerythritolleadingproductsproductioncapacity.YiHuaistheAsianlargestpentaerythritolproductionmanagemententerpriseandthecountry'slargestmanufacturingenterprisesoftheureanitrogenfertilizerindustry,inthefrontrow.YiHuabrandurea,DuoCiinspection-freeproductexporttotheU.S.,Singaporeandothercountries;Pentaerythritolinthenationalmarketshareto33%DuoCiexporttoKorea,andJapanese.

HubeiYiHuapredecessorisestablishedin1977yearsofyichangdistrictchemicalplantofhubeiprovince.In1992,asChina'sfirstbatchofjointstocksystemreformpilotenterprisestandardization,oneofhubeiYiHuachemicalchangesthesystemisajointstocklimitedcompany,inJuly1996,thecompanytosocialpublicofferingof16.35millionshares,andthecommonstockinAugust1996,inshenzhenstockexchangelistingsuccess,isChina'sfirstofalistedcompany,benitrogenreputationof"China'sfirstshares."nThecompany'spresentequitystructure:thetotalequity213880370shares,ofwhich62875822sharesofstate-ownedshares,29.40%ofthetotalstockof;Sociallegalpersonshare42154183shares,accountingfor19.71%ofthetotalequity;RMB108850365shares,commonstockterritorytotalequityof50.89%.

YiHuacompanyenterpriseculture:thecorevaluesthatis"seekingtruthfromfactsandstrictlight,hardstruggle,strivingforthetopof"thespiritofenterprise."Seektruthfromfacts"istheideologicallineYiHua;"Light"isstrictlyYiHuamanagementidea;"Hardwork"isYiHuaworkingstyle;"Createfirst-rate"isYiHuastandardofwork.

HubeiYiHuacompanyfinancialstatementanalysis

Horizontalcomparisonanalysis

（1）BalancesheetHorizontalcomparisonanalysis

Reportperiod

2010-12-31

2009-12-31

Precentageincrease

Currentassests

Moentarycapital

1,561,696,332.11

1,137,496,112.90

37.29%

Financialassests

557,222.26

19,726,580.56

-97.18%

Billreceivable

142,040,703.21

132,631,532.23

7.09%

Accountsreceivable

620,459,350.99

187,072,178.27

231.67%

Paymentinadvance

2,044,516,236.62

574,839,168.42

255.67%

Interestreceivable

--

--

Accountsreceivable-others

309,814,908.18

136,257,977.80

127.37%

Inventory

2,521,030,246.05

1,629,731,671.34

54.69%

Non-currentassesstsduewithinoneyear

--

--

Currentassests-other

20,369,098.38

--

Totalcurrentassets

7,220,484,097.80

3,817,755,221.52

89.13%

Non-currentassets

Termequityinvestment

7,257,600

7,180,000

1.08%

Termaccoutsreceivable

--

--

Permanentassets

9,015,734,029.73

7,569,521,258.26

19.11%

Projiectgoodsandmaterial

52,579,903.60

--

Projectunderconstruction

1,873,662,231.98

1,205,752,028.78

55.39%

Disposaloffixedassets

--

--

Intangibleassets

520,482,250.01

865,510,753.41

-39.86%

Goodwill

2,716,392.39

2,716,392.39

0.00%

Longtermdeferredexpenses

12,000,000

13,500,000

-11.11%

Deferredincometaxassets

40,897,012.69

34,064,526.37

20.06%

Othernon-currentassets

--

--

Totalnon-currentassets

11,525,329,420.40

9,698,244,959.21

18.84%

Totalassets

18,745,813,518.20

13,516,000,180.73

38.69%

Currentliability

Short-termloans

3,721,638,215.15

2,730,626,253.74

36.29%

Notespayable

88,453,207.44

129,669,268.72

-32.00%

Accountspayable

1,167,883,484.08

708,718,670.60

64.79%

Advancefromcustomers

1,230,748,059.75

731,917,578.56

68.15%

Payrollpayable

18,120,254.50

19,413,888.75

-6.66%

Taxespayable

-152,512,621.70

-52,919,043.41

188.20%

Dividendspayable

3,011,346.47

7,671,861.52

-60.75%

Otherpayable

341,481,390.13

399,271,222.19

-14.47%

Provision

--

--

Deferredrevenue

--

--

Non-currentliabilityduewithinoneyear

210,400,000

100,400,000

109.00%

Othercurrentliability

--

--

Totalcurrentliability

6,629,223,335.82

4,774,769,700.67

38.84%

Noncurrentliability

Long-termloans

5,501,497,800

3,152,000,000

74.54%

Bondspayable

688,448,681.96

687,500,000

0.14%

Long-termpayable

642,580,680

1,090,380,680

-41.07%

Grants&Subsidiesreceived

128,321,153.33

131,465,700

-2.39%

Deferredincometaxliabilities

54,865.90

910,794.29

-93.98%

Totalnon-currentliability

6,960,903,181.19

5,062,257,174.29

37.51%

Totalliability

13,590,126,517.01

9,837,026,874.96

38.15%

Owners'Equity

Paidincapital

542,378,052

542,378,052

0.00%

Capitalreserves

339,741,469.18

315,316,469.18

7.75%

Surplusreserves

191,103,284.31

161,831,628.57

18.09%

Retainedprofitsafterappropriation

1,571,526,988.80

1,082,505,112.67

45.18%

Totalowners'equityRelegatedtotheparentcompany

2,725,505,297.78

2,170,619,972.75

25.56%

Totalowners'equity

5,155,687,001.19

3,678,973,305.77

40.14%

Totalliability&equity

18,745,813,518.20

13,516,000,180.73

38.69%

FromthetableofcomparativedatacanbeseenintheYiHuacompanyin2010,totalassetsis-09havesmallincrease,betterthantheincreasedby38.69%.Inthecapitaltakesup,2010yearsofcurrentassetsthantheincreasedby89.13%,haveabigincrease,inthecurrentassetsprojects,accountsreceivableandprepaidreceivableaccountingforalargeproportion,growthwas231.67%and255.67%,respectively,intwotimes.Inaddition,otherreceivableswasalso127.37%increase.Soflowwithtotalassetsofmoregrowth.Inthecurrentassets,theprojectunderconstructionhasagreatgrowththatcompaniesinonalargescale,theexpansionofthemanyprojects.

Inthecapitalsource,accountspayableandreceivableinadvancetoincrease64.79%and68.15%respectively,thecompanyusingcommercialcreditraisedlargeportionsofthefunds.Inaddition,inliabilitiesamaturityofnon-currentliabilitiesdouble,andlongtermliabilitiesincreasedby74.54%,shouldpayattentiontothecompaniesfacefinancialrisk.Thecompany'sshareholders'rightsandinterestsalsoincreased.

（2）Horizontalcomparisonoftheincomestatement

Reportperiod

2010-12-31

2009-12-31

Precentageincrease

Revenue

11,544,950,317.21

8,760,618,631.51

31.78%

Revenue

11,544,950,317.21

8,760,618,631.51

31.78%

Totalcostofsales

10,450,781,232.76

8,253,739,887.95

26.62%

Costofsales

8,918,039,259.43

7,283,433,120.28

22.44%

SalesTax

30,581,997.02

7,891,415.50

287.53%

Sellingexpenses

614,917,197.49

314,287,184.65

95.65%

Managementfee

394,866,500.38

290,362,558.37

35.99%

Financeexpense

431,646,489.85

345,239,911.98

25.03%

Assetsdecreaseinvalue

60,729,788.59

12,525,697.17

384.84%

Otherbusinessincome

--

--

Thechangesinthefairvaluenetincome

-61,358.30

6,071,961.88

-101.01%

Netinvestmentprofit

4,756,817.53

1,105,802.51

330.17%

Profitfromoperation

1,098,864,543.68

514,056,507.95

113.76%

Non-operatingincome

90,186,065.15

44,650,013.95

101.98%

Non-operatingexpense

29,354,652.39

14,720,486.17

99.41%

Non-currentassetsdisposalnetloss

5,516,578.23

7,070,594.92

-21.98%

ProfitbeforeTax

1,159,695,956.44

543,986,035.73

113.18%

Incometax

132,366,592.18

96,072,430.24

37.78%

Unrealisedinvestmentlosses

--

--

Netprofit

1,027,329,364.26

447,913,605.49

129.36%

Minorityshareholdersandlosses

454,798,027.19

210,224,538.92

116.34%

Relegatedtothenetprofitsoftheparentcompanyshareholders

572,531,337.07

237,689,066.57

140.87%

Earningspershare

Basicearningspershare

1.06

0.44

140.91%

Dilutedearningspershare

1.06

0.44

140.91%

Thedatashowedthatin2010,operatingincomethanthegrowthof31.78%,withoperatingincomegrowthcostexpensesalsoincreased.Inaprojecttoalargerextentchangeisthelossofassetimpairment,closetotheextentofthefourtimes.Thegrossprofitgrowthof330.17%.Overall,2010yearsofprofitthanthemoregrowth,thatin2010thecompanybusinessperformanceisbetter,theincreaseinprofits.Sotheowners'equity,netearningspersharehavegrowth.Socansee,hubeiYiHuacompanyhavegoodgrowthprospects.

Longitudinalcomparisonanalysis

(1)BalancesheetLongitudinalcomparisonanalysis

Assets

2008-12-31

2009-12-31

2010-12-31

CurrentAssets

27.88%

28.25%

38.52%

Long-terminvestment

0.07%

0.05%

0.04%

Permanentassets

40.45%

56.00%

48.09%

Intangibleassets

5.94%

6.40%

2.78%

Deferredtax

0.75%

0.25%

0.22%

Othernon-currentassets

24.90%

9.04%

10.35%

Totalassets

100.00%

100.00%

100.00%

Liability&equity

2008-12-31

2009-12-31

2010-12-31

Currentliability

51.37%

35.33%

35.36%

Long-termpayable

20.61%

31.39%

32.78%

Deferredincometaxliabilities

0.00%

0.01%

0.00%

Otherliability

1.67%

3.21%

Paidincapital

4.80%

4.01%

2.89%

Capitalreserves

2.67%

2.33%

1.81%

Surplusreserves

1.44%

1.20%

1.02%

Retainedprofitsafterappropriation

8.49%

8.01%

8.38%

Totalowners'equityRelegatedtotheparentcompany

17.40%

16.06%

14.54%

Totalliability&equity

100.00%

100.00%

100.00%

Theabovelongitudinalanalysesthelistreflectsthecompanycapitaltakesupformandsourcesofstructuralchange.Inrecentyears,theproportionofcurrentassetslookgraduallyincreasedin2010,a10%growthin,hasseenthecompany'scashflowfunctionbetter.

Inthecompany'sliabilitiesintheform,mainlyisthecurrentliabilitiesinrecentyears,butthecurrentliabilitiesdeclined,andhasdroppedabout20%thanandlongtermliabilitiesandproportion,andisagrowingstate,sothecompanyshouldpayattentiontothefinancialrisk.

Theincomestatementlongitudinalanalyses

Reportperiod

2010-12-31

2009-12-31

2008-12-31

Revenue

100.00%

100.00%

100.00%

Costofsales

77.25%

83.14%

82.91%

Sellingexpenses

5.33%

3.59%

1.56%

Managementfee

3.42%

3.31%

3.59%

Financeexpense

3.74%

3.94%

3.90%

Assetsdecreaseinvalue

0.53%

0.14%

3.23%

Netinvestmentprofit

0.04%

0.01%

0.94%

ProfitbeforeTax

10.05%

6.21%

0.13%

Netprofit

8.90%

5.11%

0.11%

Inthecostandincomestructure,operatingcostsdecreasetrendthatcompaniesintheguaranteeofoperatingrevenuealsoreadycostcontrolwork.Inthecostofsales,costmanagement,thefinancialcosts,whicharenobigchange,butthebasiccostofsalesincreased,indicatingaslightcompany'ssalesincreasedthestrength,putmorecapital,ofcourse,alsomadeaverygoodeffect.Netprofiteveryyear,arisingtrendin2010thanin2008havelargergrowth.

3、YiHuacompanyfinancialindexcomparisonanalysis

Reportperiod

2010-12-31

2009-12-31

2008-12-31

Earningsindex

Company

shanghai&shenzhen

Industry

Company

shanghai&shenzhen

Industry

Company

shanghai&shenzhen

Industry

Grossprofitmargin

22.75%

32.24%

22.25%

16.86%

33.06%

22.87%

17.09%

27.68%

22.13%

Businessprofitability

9.52%

14.39%

6.05%

5.87%

14.30%

4.24%

5.59%

11.89%

3.41%

Netinterestrate

4.96%

10.88%

6.03%

2.71%

10.86%

3.31%

3.70%

10.28%

2.81%

Debtserviceindex

liquidityratio

1.09%

1.12%

1.10%

0.80%

1.09%

0.94%

0.54%

1.06%

0.94%

Fastactingratio

0.71%

0.75%

0.78%

0.46%

0.74%

0.68%

0.22%

0.73%

0.66%

Equitymultiplier

3.64

8.28

2.22

3.67

8.58

2.45

3.61

9.94

2.44

Operrationcapability

Thereturnonassets

3.05%

1.94%

4.36%

1.76%

1.76%

1.93%

2.33%

2%

1.88%

Netassetsyield

21.01%

16.05%

10.10%

10.95%

14.24%

4.69%

13.41%

15.37%

4.35%

Turnoverrate

ReceivablesTurnoverRatio

28.59

16.51

13.53

66.76

15.57

12.4

69.86

20.6

15.25

Inventoryturnover

4.3

4.8

4.73

4.14

4.78

4.4

3.85

5.81

4.35

Totalassetturnover

0.72%

--

--

0.71%

--

--

0.71%

--

--

Profitabilityanalysis

TheearningsoftheindexesYiHuacompanyhasnearlythreeyearswiththeindustryandcsi300givesacomparisonbetweentheindexvalue.Inthecompanyfrom17.09%andindustry,thegapbetween22.13to22.75%in2010,22.25%oftheearningsoftheindustry,industrygrowth,butYiHuaindexinthegrowthofthecompany,havemorethanmorequickly,althoughtheindustryindexcsi300indexstillhavecertaindisparity,butthecompanywillcontinuetoworkhard,tocontinuethedevelopmentoftheindustry,trytobethebest,thisasthegoal.

Debtpayingabilityanalysis

Giventhedebtindex,includinginrecentyearsandindustrytothecompanyaveragelevel.Fromthecurrentratiotosee.Thecurrentratiooflessthan1%,andthegapisstillrelativelybigindustry,thenthecompanythatisnotverystrongcapitalturnover,capitalturnoverisnotverygood,thisforthefinancingisnotparticularlybeneficial.Butby2010,thecompany'scurrentratiohasbeenclosetotheindustrylevel.Theindexhydraulicratioalsoissuch,throughtheseyearshasgraduallyinclosetotheindustrystandard,progressisfaster.

Operationabilityanalysis

Combinedwiththeaboveoperationcapacityindexandtheturnoverindextwotablecompanyoperationcapacityanalysis.Seenfromthetable,twoyearsbeforethecompany'saccountsreceivableratioishigher,butby2010from66.76%to28.59%,accountsreceivableoftherecoveryofspeed,thissituationalsoshowsthatenterpriseassetliquidityiscrumbling,companiesneedtopay.Inventoryturnoverfromview,fluctuationisnotlarge,andinrecentyearsthedifferencebetweenindustriesalsoisnotverybig.Finallythecompany'stotalassetsofbasicnobigchanges.

4、HubeiYiH