The Gross margin was 33%, when they back out an inventory adjustment of 91 million RMB, the gross margin is still 30%. There CEO affirmed there is no other one-time item and the margin improvement was due to more shift to higher power engines and price increase. They think an improved margin is sustainable.
They are gainning market share in heavy duty engine big time by developing good relationship with the end customers. They are very confident they will continue to gain market share in the heave duty engine market.
The will come to the Piper conference in New York on May 17.