Financial Performance - Revenue declined by 4.5% to $19,488 million, and operating profit fell by 36.4% to $1,047 million[1] - Profit attributable to the company's owners (before biological fair value adjustment) decreased by 37.7% to $569 million, with basic earnings per share dropping by 37.7% to 4.43 cents[1] - The company's operating loss in the U.S. and Mexico was $551 million, compared to an operating profit of $85 million in the previous period[7] - The company expects continued pressure on short-term financial performance due to unfavorable operating conditions and high production costs[8] Sales and Market Trends - Meat product sales decreased by 1.9% to 2,387 thousand tons, while pork sales decreased by 0.7% to 2,961 thousand tons[1] - In China, pork sales increased by 7.4% due to expanded production, while sales in the U.S. and Mexico decreased by 4.5% due to business restructuring[7] - Average pig prices in China fell by 10.6% to RMB 15.42 per kg ($2.19), while in the U.S., prices dropped by 17.7% to $1.40 per kg due to weak demand[3] - In Europe, the average carcass price increased by 29.3% to €2.34 per kg ($2.54) due to tightening supply[3] - European operations improved significantly, with an operating profit of $61 million compared to an operating loss of $18 million in the previous period[7] Corporate Governance and Oversight - The financial data for the nine months ending September 30, 2023, has not been audited but has been reviewed by the board's audit committee[9] - The executive directors of the company include Mr. Wan Long, Mr. Guo Lijun, Mr. Wan Hongwei, Mr. Ma Xiangjie, and Mr. Charles Shane Smith[9] - The non-executive director is Mr. Jiao Shuge, while the independent non-executive directors are Mr. Huang Ming, Mr. Liu Zhantian, and Ms. Zhou Hui[9] - The board of directors is actively involved in overseeing the financial performance and strategic direction of the company[9] - The review process is part of the company's governance framework to maintain transparency and accountability[9] Strategic Focus and Future Outlook - The company plans to focus on restructuring its industry value chain and expanding its sales network while managing prices and controlling costs[8] - The company is committed to ensuring the accuracy of the financial information presented to stakeholders[9] - The financial results will provide insights into the company's operational efficiency and market positioning[9] - The company is focused on enhancing shareholder value through strategic financial management[9] - The financial data will be crucial for future investment and corporate decision-making processes[9] - The announcement date is October 24, 2023, indicating the timeliness of the financial review[9]

Financial Performance - Total revenue for the first half of 2023 was $13,116 million, a decrease of 2.1% compared to $13,398 million in the same period of 2022[8]. - Operating profit fell by 47.2% to $639 million from $1,211 million year-on-year[8]. - Profit attributable to the company's owners (before biological fair value adjustments) decreased by 45.4% to $383 million from $701 million in the previous year[8]. - Basic earnings per share (before biological fair value adjustments) dropped by 45.2% to 2.99 cents from 5.46 cents[8]. - Total revenue for the first half of 2023 decreased by 2.1% to $13.116 billion, primarily due to reduced meat product revenue in China and the United States[14]. - Operating profit fell by 47.2% to $639 million, largely attributed to losses in the pork segment[14]. - Gross profit for the same period was $2,026 million, down 22.8% from $2,623 million year-on-year[47]. - Net profit for the six months ended June 30, 2023, was $502 million, a decrease of 40.0% compared to $837 million in the prior year[48]. - Basic earnings per share for the period was 3.27 cents, down from 5.92 cents in the same period last year[48]. - The group reported a pre-tax profit of $657 million for the first half of 2023, compared to $1,155 million in the same period of 2022[70]. - The total comprehensive income for the six months ended June 30, 2023, was $490 million, compared to $578 million for the same period in 2022, reflecting a decrease of approximately 15.2%[51]. Sales and Market Performance - Pork sales volume decreased by 0.2% to 2,026 thousand tons, while meat product sales volume fell by 0.9% to 1,597 thousand tons[7]. - The business in China accounted for 34.2% of total revenue and 81.4% of operating profit, compared to 32.6% and 44.3% respectively in the previous period[9]. - The business in the US and Mexico contributed 53.4% of total revenue and 5.6% of operating profit, down from 57.2% and 51.1% respectively[9]. - Pork revenue increased by 0.5% to $5.580 billion, with notable growth in China (4.5%) and Europe (22.4%), while revenue in the U.S. and Mexico decreased by 5.0%[18]. - In the U.S., pork and offal export volume rose by 17.9%, with exports to China increasing by 26.7%[11]. - The European segment generated total revenue of $2,014 million, with a profit of $83 million, indicating a stable performance in that region[67]. Operational Insights - The meat products segment accounted for 50.7% of total revenue and 167.1% of operating profit, highlighting its core importance to the company[14]. - Operating loss in the pork business was $409 million, compared to an operating profit of $124 million in the previous period[19]. - Operating profit in the U.S. increased by 7.2% to $578 million despite a revenue decline, due to lower raw material costs and improved operational efficiency[17]. - The company plans to continue focusing on market expansion and product innovation to enhance its competitive position in the global pork industry[9]. - The company plans to continue expanding its sales network and product offerings to adapt to market conditions and consumer preferences[15]. Financial Position and Debt - Cash and bank balances as of June 30, 2023, were $828 million, down from $1.394 billion at the end of 2022[22]. - Total outstanding loans amounted to $3.468 billion as of June 30, 2023, compared to $3.395 billion at the end of 2022[25]. - 99.7% of loans were unsecured as of June 30, 2023, with no defaults on bank loan repayments during the review period[26]. - The company maintained a current ratio of 1.6 as of June 30, 2023, consistent with the previous period[22]. - As of June 30, 2023, the company's debt-to-equity ratio was 33.2% and the net debt-to-equity ratio was 25.2%, compared to 32.3% and 18.9% as of December 31, 2022[27]. - Financial costs for the review period amounted to $85 million, an increase of 7.6% compared to the previous period, primarily due to higher applicable interest rates on bank loans[28]. Investments and Acquisitions - The company completed the acquisition of 100% of Goodies Meat Production S.P.L. in February 2023, enhancing its existing business in Europe[31]. - Capital expenditures for the review period were $448 million, with significant investments in China, the U.S. and Mexico, and Europe[34]. - The company has established a provision of $194 million to settle all collective claims related to antitrust litigation in the U.S.[40]. Legal and Regulatory Matters - The company is actively defending against 37 ongoing individual claims related to antitrust issues[40]. - Smithfield Foods, a wholly-owned subsidiary of the company, is involved in antitrust litigation with claims dating back to 2009, alleging price-fixing in the pork industry[104]. - The company agreed to a settlement of $77 million for direct buyer class claims, which was approved by the Minnesota federal court[105]. - Currently, there are 37 individual cases against the company, with three cases filed by federal or state representatives seeking compensation based on consumer purchases[105]. Sustainability and Corporate Governance - The company is committed to providing sustainable protein options while monitoring the impact of operations on the environment and community[41]. - The company has established an Environmental, Social, and Governance (ESG) committee to guide its sustainability goals[41]. - The company is subject to various laws and regulations, with ongoing assessments of legal claims that may impact cash flow and liquidity[103]. - The company has adhered to all applicable code provisions of the corporate governance code throughout the review period[146]. - The audit committee consists of three independent non-executive directors, ensuring oversight of the group's interim performance and internal controls[147]. Future Outlook - The company provided a positive outlook for the second half of 2023, expecting a revenue growth of 10% to 12%[150]. - New product launches are anticipated to contribute an additional HKD 1 billion in revenue by the end of 2023[151]. - Market expansion plans include entering two new international markets by Q4 2023, projected to increase market share by 5%[151]. - The company aims to reduce operational costs by 8% through efficiency improvements in the next fiscal year[150].

Financial Performance - Revenue for the six months ended June 30, 2023, was $13,116 million, a decrease of 2.1% compared to $13,398 million in the same period of 2022[2]. - Operating profit decreased by 47.2% to $639 million from $1,211 million year-on-year[3]. - Profit attributable to the owners of the company (before biological fair value adjustments) fell by 45.4% to $383 million from $701 million in the previous year[3]. - Basic earnings per share (before biological fair value adjustments) decreased by 45.2% to 2.99 cents from 5.46 cents in the same period last year[3]. - Gross profit for the same period was $2,026 million, down from $2,623 million in 2022, indicating a decrease of about 22.8%[44]. - The company reported a pre-tax profit of $610 million, significantly lower than the $1,088 million reported in the previous year, reflecting a decline of approximately 43.8%[44]. - The net profit for the period was $540 million, compared to $837 million in the prior year, marking a decrease of around 35.5%[45]. - The company anticipates continued pressure on short-term financial performance due to unfavorable operating conditions, particularly in the U.S. market[43]. Revenue Breakdown - The company's operations in China accounted for 34.2% of total revenue and 81.4% of operating profit, up from 32.6% and 44.3% respectively in the previous year[5]. - Pork revenue increased by 0.5% to $5.580 billion, with a 4.5% increase in China, while the U.S. and Mexico saw a 5.0% decline[18]. - Total revenue for the China segment was $5,054 million, with a reported profit of $520 million for the six months ending June 30, 2023[54]. - The total revenue for the US and Mexico segment was $8,462 million, with a reported loss of $36 million for the same period[54]. - The total revenue for the Europe segment was $2,014 million, with a reported profit of $83 million[54]. - The overall total revenue across all segments was $15,530 million, with a reported profit of $639 million[54]. Operational Metrics - Pork sales volume decreased by 0.2% to 2,026 thousand tons compared to 2,031 thousand tons in the previous year[2]. - Total pig slaughter volume remained at 25.43 million heads, with an 8.4% increase in China but a 2.6% decrease in the U.S. and Mexico[17]. - The poultry business slaughtered approximately 146 million birds, a 40.1% increase compared to the previous period[20]. - Other businesses generated revenue of $883 million, a 13.9% increase, driven by poultry expansion[20]. - Operating profit for the pork business was a loss of $409 million, compared to a profit of $124 million in the previous period[19]. - Operating profit in the U.S. pork segment was a loss of $495 million, significantly impacted by unfavorable market conditions[19]. Assets and Liabilities - Non-current assets totaled $11,780 million as of June 30, 2023, compared to $11,846 million at the end of December 2022, showing a slight decrease[46]. - Current assets decreased to $7,301 million from $8,009 million, indicating a reduction of approximately 8.8%[46]. - As of June 30, 2023, total current liabilities amounted to $4,453 million, a decrease from $4,985 million as of December 31, 2022, representing a reduction of approximately 10.7%[47]. - Non-current liabilities totaled $4,280 million as of June 30, 2023, a decrease from $4,458 million at the end of 2022, representing a reduction of about 4%[47]. - The company's equity attributable to owners was $9,604 million as of June 30, 2023, compared to $9,600 million at the end of 2022, indicating a slight increase of approximately 0.04%[47]. Cash Flow and Financing - The net cash flow from operating activities for the six months ended June 30, 2023, was $2 million, compared to $34 million for the same period in 2022, indicating a significant decline of approximately 94.1%[48]. - The net cash flow used in investing activities was $(363) million for the six months ended June 30, 2023, compared to $(160) million for the same period in 2022, reflecting an increase in cash outflow of approximately 126.9%[48]. - The net cash flow used in financing activities was $(202) million for the six months ended June 30, 2023, a decrease from $(416) million in the same period of 2022, indicating a reduction in cash outflow of approximately 51.5%[48]. - As of June 30, 2023, the company had cash and bank balances of $828 million, down from $1.394 billion on December 31, 2022[22]. - The total outstanding loan principal was $3.468 billion as of June 30, 2023, an increase from $3.395 billion on December 31, 2022[25]. Capital Expenditures - Capital expenditures for the review period amounted to $448 million, with $230 million allocated to China, $167 million to the US and Mexico, and $51 million to Europe[35]. - The total capital expenditure for property, plant, and equipment was $296 million for the six months ending June 30, 2023, down from $540 million in the previous year[61]. - In the US, capital expenditures were mainly related to the modernization of slaughterhouses and upgrades to meat processing facilities[35]. Corporate Governance and Compliance - The audit committee consists of three independent non-executive directors, ensuring compliance with financial reporting standards[75]. - The company has adhered to the corporate governance code as per the Hong Kong Stock Exchange regulations throughout the review period[76]. Environmental and Risk Management - The company has implemented environmental policies to manage regulatory and environmental risks associated with its biological assets[64]. - The company faces risks related to climate change, diseases, and other natural forces affecting its biological assets, with processes in place for monitoring and risk reduction[65].

Sales Performance - Meat product sales decreased by 1.0% to 820,000 tons, while pork sales fell by 1.2% to 1,021,000 tons compared to the same period last year[1]. - The company experienced a 3.5% decrease in meat product revenue, primarily due to declining consumer demand in the U.S.[5]. Financial Results - Revenue increased by 2.9% to $6,743 million, but operating profit dropped by 43.1% to $365 million[1]. - Profit attributable to the company's owners (before biological fair value adjustment) decreased by 55.9% to $174 million, with basic earnings per share down 55.8% to 1.36 cents[1]. - The company recorded an operating loss of $170 million in the pork segment, compared to an operating profit of $45 million in the same period last year[6]. Market Conditions - Average pig prices in China rose by 12.0% to approximately $2.29 per kg, while in the U.S., prices fell by 16.0% to $1.27 per kg due to weak demand[2]. - In Europe, pork prices increased significantly due to limited supply, with average prices rising by 46.0% to approximately $2.35 per kg[2]. Strategic Focus - The company plans to focus on optimizing its industry value chain and implementing strict product structure adjustments, price management, and cost control in response to market challenges[7]. - The company aims to leverage its global business deployment to better allocate resources and create synergies amid a highly uncertain external environment[7]. Asset Management - The total assets as of March 31, 2023, increased to $20,372 million from $19,855 million at the end of 2022[1].

Financial Performance - Revenue rose by 3.1% to $28,136 million in 2022, compared to $27,293 million in 2021[7] - Operating profit increased by 6.5% to $2,093 million in 2022, up from $1,966 million in 2021[7] - Profit attributable to shareholders (before biological fair value adjustments) surged by 34.3% to $1,401 million in 2022, compared to $1,043 million in 2021[8] - Basic earnings per share (before biological fair value adjustments) rose by 48.2% to 10.92 cents in 2022, compared to 7.37 cents in 2021[8] - The company reported a significant increase in revenue, with a year-over-year growth of 15% in the last quarter[29] - The company provided an optimistic outlook, projecting a revenue growth of 10-12% for the upcoming fiscal year[29] - The company achieved a revenue growth rate of 3.1% in 2022, down from 6.7% in 2021, reflecting a decrease of 3.6 percentage points[46] - The adjusted EBITDA margin before biological fair value adjustments improved to 11.2% in 2022 from 9.1% in 2021, an increase of 2.1 percentage points[46] - The net profit margin before biological fair value adjustments increased to 6.0% in 2022, up from 4.7% in 2021, representing a rise of 1.3 percentage points[46] Sales and Production - Meat product sales increased by 0.7% to 3,344 thousand tons in 2022, compared to 3,320 thousand tons in 2021[6] - Pork sales decreased by 7.9% to 4,019 thousand tons in 2022, down from 4,362 thousand tons in 2021[6] - The meat products segment accounted for 98.7% of the group's operating profit and 51.7% of total revenue in 2022, up from 96.4% and 50.6% in 2021, respectively[36] - The pork business contributed 1.4% to the group's operating profit and 41.9% to total revenue in 2022, compared to 0.2% and 43.9% in 2021[36] - The poultry business slaughtered approximately 240 million birds in 2022, an increase of 30.2% from the previous year, contributing to the protein diversification strategy[42] - The total output of live pigs in China in 2022 was 700 million heads, an increase of 4.3% from 671 million heads in 2021[31] - The total pork production in China reached 55.4 million tons in 2022, up 4.5% from 53 million tons in 2021[31] Dividends and Shareholder Returns - The company plans to distribute a final dividend of HK$0.25 per share, bringing the total dividend for the year to HK$0.30 per share[12] - The company proposed a final dividend of HKD 0.25 per share for the year ended December 31, 2022, compared to HKD 0.14 per share in 2021, resulting in a total dividend of HKD 0.30 per share for 2022, amounting to approximately HKD 38.49 billion or USD 4.90 billion[109] - The company plans to continue paying interim and final dividends amounting to no less than 30% of the net profit attributable to equity holders of the parent company[112] Management and Governance - The board consists of nine directors, including five executive directors, one non-executive director, and three independent non-executive directors[13] - The leadership team is committed to enhancing the company's market position and operational efficiency[15] - The company is committed to maintaining high standards of corporate governance through its experienced board and management team[18] - The management team has a diverse range of experiences across various sectors, which is expected to drive innovation and market expansion[18] - The company emphasizes the importance of corporate culture aligned with its purpose, values, and strategy, promoting a legal and ethical framework[79] Market and Operational Strategy - The company aims to enhance its supply chain and diversify its meat products while expanding market reach and optimizing processes for better competitiveness[12] - The Americas business saw a significant 20% increase in meat product profitability despite ongoing inflationary pressures[12] - The European business faced challenges with sales and profitability declining due to the impacts of war, animal diseases, and inflation[12] - The company is focused on leveraging the expertise of its board members to enhance strategic decision-making and market positioning[18] - The company aims to increase its market share by 3% through targeted marketing strategies[29] Financial Position and Ratios - The company maintained a current ratio of 1.6 as of December 31, 2022, compared to 1.7 in 2021[48] - The debt-to-equity ratio improved to 32.3% in 2022 from 41.4% in 2021, a decrease of 9.1 percentage points[46] - The company has a total unused bank financing amounting to $5.725 billion as of December 31, 2022, compared to $5.796 billion in 2021[48] - The total outstanding loan principal as of December 31, 2022, was $3.395 billion, a decrease from $4.049 billion in 2021[55] - The company's capital expenditures for 2022 amounted to $975 million, compared to $933 million in 2021, with significant investments in China and the U.S.[58] Risk Management and Compliance - The company has a risk management system in place to monitor and report on significant risks, with an effective Enterprise Risk Management (ERM) system[69] - The company emphasizes the importance of proper handling and disclosure of inside information, adhering to relevant regulations and guidelines[99] - The company has established a comprehensive risk management and reporting system to address significant risks and ensure business objectives are met[97] - The company conducted an annual review of its risk management and internal control systems, ensuring their adequacy and effectiveness[96] Sustainability and Community Engagement - The company was selected as a constituent of the Hang Seng Sustainable Development Index and received an A+ rating in 2022, indicating recognition of its performance in sustainability[75] - The company achieved a BBB rating from MSCI, the world's largest index provider, reflecting its commitment to environmental, social, and governance (ESG) standards[75] - Charitable donations made by the company during the review period totaled USD 5 million, reflecting its commitment to community engagement[114] - The company is actively monitoring the impact of its operations on the environment and surrounding communities, reflecting its commitment to sustainable development[75] Audit and Financial Reporting - The consolidated financial statements for the year ended December 31, 2022, were audited by Ernst & Young[148] - The audit committee assists the board in overseeing the financial reporting process and ensuring compliance with relevant regulations[153] - The auditor's responsibility includes identifying and assessing risks of material misstatement in the financial statements and designing appropriate audit procedures[155] - The company is responsible for preparing financial statements that are free from material misstatement due to fraud or error, in accordance with International Financial Reporting Standards[153] Shareholding and Equity - Mr. Wan Long holds a total of 2,169,781,518 shares, representing approximately 16.91% of the company's equity[127] - Mr. Ma Xiangjie has a significant stake of 5,029,376,978 shares, accounting for 39.20% of the company's equity[127] - The company has a total of 146,198,889 shares held by Mr. Wan Long related to stock options, which is about 1.14% of the total shares[129] - The company has a total of 301,736 shares held by Mr. Wan Long in a related corporation, representing 0.01%[130]

Financial Performance - WH Group Limited reported a 3.1% increase in revenue to $28,136 million for the year ended December 31, 2022, compared to $27,293 million in 2021[1]. - The company's operating profit rose by 6.5% to $2,093 million in 2022, up from $1,966 million in the previous year[1]. - The profit attributable to the company's owners (before biological fair value adjustments) increased by 34.3% to $1,401 million, compared to $1,043 million in 2021[1]. - Basic earnings per share (before biological fair value adjustments) increased by 48.2% to 10.92 cents, up from 7.37 cents in 2021[1]. - Revenue growth rate for 2022 was 3.1%, down from 6.7% in 2021, a decrease of 3.6 percentage points[14]. - EBITDA margin before biological fair value adjustments increased to 11.2% in 2022 from 9.1% in 2021, an increase of 2.1 percentage points[14]. - Operating profit margin improved slightly to 7.4% in 2022 from 7.2% in 2021, an increase of 0.2 percentage points[14]. - Gross profit for 2022 was $5,177 million, up from $4,996 million in 2021, reflecting a gross margin increase[45]. - Net profit for the year was $1,683 million, representing a 1.9% increase from $1,650 million in the previous year[46]. Sales and Revenue Breakdown - Pork sales volume decreased by 7.9% to 4,019 thousand tons in 2022, down from 4,362 thousand tons in 2021[1]. - The sales volume of meat products increased by 0.7% to 3,344 thousand tons in 2022[1]. - In China, the company's business accounted for 33.9% of total revenue and 49.7% of operating profit in 2022, compared to 38.5% and 47.3% in 2021, respectively[3]. - In the United States and Mexico, the business contributed 56.0% of total revenue and 44.9% of operating profit in 2022, up from 52.0% and 46.7% in 2021[3]. - The company's pork revenue decreased by 1.4% to $11.797 billion, with a significant drop of 17.2% in China attributed to lower average pork prices and adverse currency effects[12]. - The meat products segment generated revenue of $13,808 million, while the pork segment contributed $11,969 million, and other segments accounted for $1,516 million[58]. Operational Challenges and Strategies - The company faced challenges in the US due to labor shortages affecting the sales of biopharmaceutical products, leading to a decrease in operating profit from other businesses by $70 million[13]. - The company plans to continue its strategy of product innovation and channel development to enhance its product mix despite disruptions caused by global pandemic measures[10]. - The company is implementing strategic inventory management and effective cost transfer to mitigate commodity price volatility[38]. - The company is actively managing foreign exchange risks and has a hedging strategy in place for significant risks[39]. - The company anticipates short-term financial performance pressures due to high inflation and macroeconomic conditions affecting consumer confidence[44]. Assets and Liabilities - The company had cash and bank balances of $1.394 billion as of December 31, 2022, down from $1.556 billion in 2021[17]. - The current ratio decreased to 1.6 times in 2022 from 1.7 times in 2021[17]. - Net cash from operating activities was $1.803 billion in 2022, down from $1.958 billion in 2021, primarily due to increased working capital needs[18]. - Total outstanding loans amounted to $3.395 billion as of December 31, 2022, down from $4.049 billion in 2021[23]. - The company maintained a debt-to-equity ratio of 32.3% in 2022, a decrease of 9.1 percentage points from 41.4% in 2021[14]. - The company’s total asset return rate improved to 8.4% in 2022 from 6.8% in 2021, an increase of 1.6 percentage points[14]. - The company reported a total equity of $10,412 million as of December 31, 2022, compared to $9,687 million in 2021[49]. Investments and Acquisitions - Capital expenditures for 2022 amounted to $975 million, up from $933 million in 2021, with significant investments in China, the US, and Europe[26]. - The acquisition of Goodies Meat Production S.R.L. was completed in February 2023, enhancing the company's presence in the European market[29]. - The company sold its stake in Norson, resulting in a pre-tax loss of $12 million, and completed the sale in November 2022[30]. - The sale of Saratoga generated $575 million in proceeds, with a pre-tax gain of $414 million, allowing the company to focus on strategic operations[31]. - The company increased its stake in Granjas Carroll de Mexico from 50% to 66%, integrating its performance into the company's financials[35]. Compliance and Governance - The audit committee confirmed that the consolidated financial information complies with applicable accounting standards and regulations[79]. - The company has maintained compliance with the public float requirements as per the listing rules[86]. - The company will hold its annual general meeting on June 6, 2023, to discuss the proposed final dividend[86]. - The company’s annual report for 2022 will be published on its website and the stock exchange website[87].

Financial Performance - Total revenue for the first half of 2022 was $13,398 million, a 0.5% increase compared to $13,331 million in the same period of 2021[7]. - Operating profit rose by 31.6% to $1,211 million, up from $920 million year-on-year[7]. - Profit attributable to the company's owners before biological fair value adjustments increased by 30.1% to $701 million, compared to $539 million in the previous year[7]. - Basic earnings per share before biological fair value adjustments rose by 49.2% to 5.46 cents, up from 3.66 cents in the same period last year[7]. - Revenue for the first half of 2022 increased by 9.4% to $7.073 billion, with a decrease of 3.3% in China, while the US revenue grew by 14.4%[16]. - Operating profit for the first half of 2022 was $1.081 billion, a significant increase of 32.5% compared to the previous year[17]. - Pork revenue decreased by 9.6% to $5.550 billion, with a notable decline of 34.0% in China, while the US and Mexico saw an increase of 18.6%[18]. - Gross profit for the same period was $2,623 million, up from $2,238 million in 2021, reflecting a 17.2% increase[45]. - Net profit for the six months ended June 30, 2022, was $837 million, a 27% increase compared to $659 million in the prior year[46]. - The company reported a total comprehensive income of $578 million for the period, compared to $875 million in the same period last year[46]. Market Dynamics - Pork sales volume decreased by 5.0% to 2,031 thousand tons, while meat product sales volume slightly declined by 0.1% to 1,612 thousand tons[7]. - In China, the total pig output increased by 8.4% to 366 million heads, and total pork production rose by 8.2% to 29.39 million tons[9]. - Average pig price in China dropped by 43.9% to RMB 14.5 per kilogram (approximately $2.24) during the review period[9]. - U.S. average pig price increased by 2.5% to $1.62 per kilogram, reflecting strong domestic demand despite a 3% decrease in overall pork production[10]. - The company reported a significant reduction in pork imports to China, with total imports down by 65.1% to 800 thousand tons during the review period[9]. - The average price of pork in the EU rose by 11.3% to €1.72 per kilogram (approximately $1.88) due to reduced supply[12]. - US pork exports decreased by 22.1% to 1.2 million tons, with exports to China dropping by 55.5%[11]. - The EU's total pork production decreased by 6.0% during the review period, influenced by African swine fever and rising input costs[12]. - The company faced challenges in China due to a slowdown in the consumer market and intense competition, leading to a 1.8% decline in meat product sales[15]. Strategic Initiatives - The company plans to continue expanding its market presence in China, the U.S., Mexico, and selected European markets to maximize profitability[8]. - The company plans to enhance price management across all sales channels to address ongoing cost pressures[16]. - The company aims to focus on pricing strategies, product mix optimization, cost control, and operational efficiency to mitigate profit margin pressures from inflation[40]. - The company plans to increase market investments, accelerate industrial upgrades, and promote a diversified protein development strategy[40]. - The company is actively managing commodity price risks through strategic inventory management and hedging activities[35]. Financial Position and Liabilities - Cash and bank balances stood at $968 million as of June 30, 2022, down from $1.556 billion at the end of 2021[22]. - The current ratio remained stable at 1.7 times, with unused bank financing totaling $4.681 billion[22]. - Total outstanding bank borrowings amounted to $3.919 billion, a decrease from $4.049 billion at the end of 2021[24]. - Financial costs increased by 16.2% to $79 million, primarily due to a higher average outstanding borrowing balance[27]. - The average interest rate on outstanding borrowings was 3.1%, up from 2.7% at the end of 2021[27]. - The debt-to-equity ratio was 39.6% as of June 30, 2022, compared to 41.4% at the end of 2021[26]. - The company maintains a strong credit rating with Fitch at BBB+, S&P at BBB, and Moody's at Baa2, all with stable outlooks[28]. - The company reported a total borrowing of $3,886 million, slightly down from $4,014 million, indicating a decrease of approximately 3.19%[85]. Biological Assets and Capital Expenditures - The company reported a fair value of biological assets at $1.607 billion as of June 30, 2022, up from $1.431 billion at the end of 2021, with a net gain from fair value adjustments of $62 million[30]. - Capital expenditures for the review period totaled $434 million, with significant investments in China for poultry and pig farming facilities[32]. - The company’s biological assets include 14.16 million pigs and 20.33 million poultry, with a 0.2% increase in pigs and a 60.6% increase in poultry from the previous year[30]. Legal and Compliance Matters - The company agreed to pay a total of $77 million to settle various antitrust claims, including $77 million for direct buyers, $42 million for commercial and institutional indirect buyers, and $75 million for consumer indirect buyers[38]. - The company is involved in multiple antitrust lawsuits, including individual claims from buyers and actions initiated by state attorneys general[101]. - The company has faced legal challenges regarding its pricing practices and compliance with sales agreements, particularly in relation to Maxwell Foods[103]. - The company is also defending against claims related to environmental issues from a pig farming operation in North Carolina[104]. Corporate Governance - The board of directors and management committed to maintaining good corporate governance practices throughout the review period[140]. - Mr. Li Gangwei resigned as an independent non-executive director effective June 1, 2022, while Ms. Zhou Hui was appointed as an independent non-executive director and chair of the audit committee on the same date[140]. - The audit committee, consisting of three independent non-executive directors, reviewed the group's interim performance along with internal controls and financial reporting matters[141]. - The company has complied with all applicable code provisions of the corporate governance code during the review period[140].

Sales Performance - Meat product sales decreased by 1.2% to 828,000 tons, while pork sales increased by 2.1% to 1,033,000 tons[2] - Revenue declined by 0.8% to $6,555 million, while operating profit increased by 28.1% to $642 million[2] - The increase in meat product revenue by 10.6% was driven by growth in the U.S. and Europe, offsetting declines in China[8] Profitability - Profit attributable to the company's owners (before biological fair value adjustments) rose by 34.8% to $395 million[2] - Basic earnings per share (before biological fair value adjustments) increased by 54.8% to 3.08 cents[2] - The company's operating profit in the U.S. increased sixfold due to rising pig and pork prices, surpassing the increase in feed costs[9] - In Europe, the company faced an operating loss of $26 million, compared to an operating profit of $5 million in the previous period[9] Market Conditions - Average pig prices in China fell by 56.1% to RMB 14.02 per kg, while in the U.S., prices rose by 15.3% to $1.51 per kg[3] - The company anticipates that the negative impacts of African swine fever and COVID-19 will gradually diminish in 2022, but inflationary pressures will pose new challenges[10] Strategic Initiatives - The company plans to continue expanding its market presence and enhancing operational efficiency through strategic acquisitions and product development[8] - The company aims to enhance its integrated supply chain to cope with soaring commodity prices and improve production efficiency through increased automation and information technology[10] - The company plans to expand its operational regions and introduce protein diversification to accelerate growth[10] - Adjustments to the product mix will be made to maximize value-added offerings[10] - Marketing innovations will be promoted to expand sales scale and maintain industry leadership[10] Financial Position - The company reported total assets of $20,855 million and equity attributable to owners of $9,306 million as of March 31, 2022[2]

Financial Performance - Revenue increased by 6.7% to $27,293 million, compared to $25,589 million in the previous year[7]. - Operating profit rose by 13.7% to $1,966 million, up from $1,729 million in the prior year[8]. - Profit attributable to shareholders (before biological fair value adjustments) increased by 7.2% to $1,043 million, compared to $973 million in the previous year[8]. - The company reported a significant increase in profitability after excluding one-time factors such as litigation and pension adjustments[11]. - The company reported a net profit for the year of $1,298 million, compared to $1,092 million in 2020, indicating a significant increase of 18.9%[162]. - The total cost of sales for the year was $22,297 million, compared to $20,563 million in 2020, reflecting an increase of 8.4%[161]. - The company recognized other income of $133 million, up from $74 million in 2020, indicating an increase of 80.5%[161]. - The operating profit for 2021 was $1.895 billion, a 26.4% increase compared to 2020, with significant growth in the U.S. market at 55.0%[47]. Market Dynamics - The U.S. business showed strong recovery with historical high revenue, while the European business faced challenges due to rising feed costs and declining pork prices[11]. - The company operates across multiple regions, including China, the United States, Mexico, Europe, and selected markets in Asia[38]. - The market dynamics in China, the United States, and Europe are crucial for the company's performance[38]. - The demand for high-quality pork products in China is expected to grow due to economic growth and improved living standards[39]. - The recovery of supply in the pork market was driven by the diminishing impact of African swine fever in China[39]. Corporate Governance - The board consists of nine directors, including five executive directors, one non-executive director, and three independent non-executive directors[13]. - The board is responsible for guiding the company's strategic objectives and overseeing business management, ensuring high governance standards across all aspects of the business[82]. - The company has adopted a code of conduct for directors' securities trading, confirming compliance with all standards during the fiscal year ending December 31, 2021[81]. - The board confirmed its responsibility for preparing accounts and ensuring that financial disclosures are balanced, clear, and understandable[105]. - The company has established a structured governance framework with six committees under the board, including the Audit Committee and the Remuneration Committee[91]. Leadership and Management - Wan Long has over 50 years of experience in the meat processing industry and has led the company to become an international business[13]. - The management team has a strong educational background, with degrees in business management and finance from reputable institutions[15]. - The leadership team emphasizes the importance of public relations and corporate governance in their strategic initiatives[16]. - The company has a strong leadership team with extensive experience in finance and management across multiple industries[19][20][21]. - Charles Shane Smith appointed as Executive Director and CEO of Smithfield Foods since August 11, 2021, overseeing daily operations of the vertically integrated business[18]. Sustainability and Social Responsibility - The company was included in the Hang Seng Sustainable Development Enterprises Index and received an A+ rating in 2021, with MSCI upgrading its ESG rating to BBB, indicating recognition of its sustainability performance[75]. - The company actively engages with its community and stakeholders, emphasizing its responsibility to give back to those who have supported its achievements[75]. - The company’s sustainability measures are driven by its business units under the guidance of the Environmental, Social, and Governance Committee[75]. - The company reported a significant charitable contribution of USD 7 million during the review period[121]. Financial Position and Cash Flow - As of December 31, 2021, the company had cash and bank balances of $1.556 billion, with a current ratio of 1.7, down from 1.9 in 2020[56]. - The company’s unused bank financing amounted to $5.796 billion as of December 31, 2021, compared to $5.032 billion in 2020[56]. - The total liabilities rose to $10,724 million in 2021, up from $7,730 million in 2020, indicating a significant increase of 38.7%[164]. - The company’s net assets decreased to $9,687 million in 2021 from $10,985 million in 2020, a reduction of 11.8%[164]. - The net cash generated from operating activities was $1.822 billion, a decrease from $2.357 billion in 2020, primarily due to reduced contributions from the Chinese business[57]. Investment and Acquisitions - The company completed the acquisition of 100% of Mecom Group on June 17, 2021, enhancing its operational presence in Slovakia and Hungary[69]. - On July 7, 2021, the company increased its stake in GCM from 50% to 66%, which is a key investment in Mexico's pork production market[69]. - The company has invested in joint ventures for renewable natural gas production in the US, with Align completing operational measures and Monarch adding two new projects in 2021[70]. Risk Management - The company actively manages commodity price risks through strategic inventory management and hedging activities to mitigate the impact of price volatility on its operations[72]. - The company’s risk management system is deemed effective, with ongoing assessments and monitoring of major risks and their mitigation strategies[71]. - The group has conducted an enterprise risk assessment in 2021 to analyze and report on major risks and establish relevant monitoring measures[107]. Shareholder Information - The company proposed a final dividend of HKD 0.14 per share for the year ended December 31, 2021, compared to HKD 0.125 per share in 2020, resulting in a total dividend of HKD 0.19 per share for 2021, amounting to approximately HKD 25.34 billion or USD 3.25 billion[116]. - The total distributable reserves of the company as of December 31, 2021, amounted to USD 2.754 billion[120]. - The company has no significant contracts with any major shareholders during the review period[130]. - The company has no plans for significant mergers or acquisitions disclosed in the report[130].