香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確 性或完整性亦不發表任何聲明，並明確表示概不就因本公告全部或任何部份內容而產生或因 依賴該等內容而引致之任何損失承擔任何責任。 CHINA YURUN FOOD GROUP LIMITED 中 國 雨 潤 食 品 集 團 有 限 公 司* （於百慕達註冊成立之有限公司） （股份代號：1068） 持續關連交易 生豬採購框架協議及生豬肉供應框架協議之補充資料 茲提述中國雨潤食品集團有限公司（「本公司」）日期為二零二四年十二月十二日內容有關 持續關連交易的公告（「該公告」）。除文義另有所指外，本公告所用詞彙與該公告所界定 者具有相同涵義。 1. 生豬採購框架協議 根據現行的採購框架協議下，二零二二年一月一日至二零二四年十二月三十一日各年度的年 度上限及實際交易額如下： | 年度上限（截至下列日期的財政年度） | 人民幣 | 等值港元（約數） | | --- | --- | --- | | 二零二二年十二月三十一日 | 11,000,000 | 13,500,000 | | 二零二三年十二月三十一日 | 14,000,000 | 17,1 ...

香 港 交 易 及 結 算 所 有 限 公 司 及 香 港 聯 合 交 易 所 有 限 公 司 對 本 公 告 的 內 容 概 不 負 責 ， 對 其 準 確 性 或 完 整 性 亦 不 發 表 任 何 聲 明 ， 並 明 確 表 示 概 不 就 因 本 公 告 全 部 或任 何部份內容而產 生或因依賴該等內容 而引致之任何損失承 擔任何責任。 CHINA YURUN FOOD GROUP LIMITED 中 國 雨 潤 食 品 集 團 有 限 公 司* （於百慕達註冊成立之有限公司） （股份代號： 1068） 於百慕達之主要股份登記及過戶總處之變更 中國雨潤食品集團有限公司 (「本公司」) 董事會(「董事會」) 謹此宣佈， 自二零二五年一月一日開始，本公司於百慕達之 主要股份登記及過戶總處將 更改為： Appleby Global Corporate Services (Bermuda) Limited Canon's Court, 22 Victoria Street PO Box HM 1179, Hamilton HM EX Bermuda 本公司於香港之股份登記及過戶分處仍然為卓佳證券登記有限公司， ...

生豬肉供應框架協議 由於現行的生豬肉供應框架協議將於二零二四年十二月三十一日到期屆滿，本公司 遂於二零二四年十二月十二日與該等生豬肉買方實體訂立了生豬肉供應框架協議， 在現行的生豬肉供應框架協議屆滿後，繼續向該等生豬肉買方實體及/或其各自的附 屬公司及/或聯繫人供應生豬肉。 香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性 或完整性亦不發表任何聲明，並明確表示，概不對因本公告全部或任何部份內容而產生或因倚 賴該等內容而引致的任何損失承擔任何責任。 CHINA YURUN FOOD GROUP LIMITED 中 國 雨 潤 食 品 集 團 有 限 公 司* （於百慕達註冊成立之有限公司） （股份代號：1068） 持續關連交易 生豬採購框架協議及生豬肉供應框架協議 生豬採購框架協議 由於現行的採購框架協議將於二零二四年十二月三十一日到期屆滿，本公司遂於二 零二四年十二月十二日與該銷售實體訂立了生豬採購框架協議，在現行的採購框架 協議屆滿後，繼續向該銷售實體及／或其附屬公司及/或聯繫人採購生豬。 《上市規則》的涵義 於本公告日，祝先生是本公司的主要股東，間接擁有本公司已發行股份約 ...

Financial Performance - In the first half of 2024, China Yurun Food Group recorded revenue of HKD 539 million, a decrease of 30.0% compared to HKD 770 million in the same period of 2023[10]. - The group reported a loss attributable to equity holders of HKD 10 million, an improvement from a loss of HKD 20 million in the first half of 2023[10]. - Fresh meat sales amounted to HKD 270 million, down 39.0% from HKD 443 million in the same period last year, accounting for approximately 50% of total revenue before internal sales[8]. - The sales revenue from deep-processed meat products was HKD 227 million, a decrease of about 2.2% compared to the same period last year[13]. - The revenue from low-temperature meat products increased by approximately 9.5% to HKD 154 million, representing about 28% of total revenue[14]. - The overall gross profit margin improved from 9.0% to 14.0%, with total gross profit rising by approximately 9.4% to HKD 76 million[15]. - The gross profit margin for low-temperature meat products increased significantly by 5.2 percentage points to 37.2%[16]. - Operating expenses decreased by 33.5% to HKD 66 million, accounting for 12.2% of total revenue[18]. - The group's operating profit was approximately HKD 12 million, a turnaround from an operating loss of HKD 28 million in the same period last year[19]. - The net loss for the period was HKD 13,191,000, compared to a net loss of HKD 39,149,000 in the same period last year, indicating a 66% improvement[56]. - The company reported a basic and diluted loss per share of HKD 0.006, an improvement from HKD 0.011 in the previous year[55]. Economic Environment - The overall economic environment in China showed a GDP growth of 5.0% in the first half of 2024, with consumer price index (CPI) rising only 0.1% year-on-year[4]. Production and Sales - The group maintained annual production capacities of approximately 3.35 million heads for upstream slaughtering and 56,000 tons for downstream processed meat products as of June 30, 2024[9]. - The group's overall sales revenue from upstream operations decreased by 43.1% to HKD 312 million, with a slaughter volume drop of approximately 50.1% to about 149,000 heads[12]. - Fresh meat accounted for approximately 50% of total revenue and 86% of upstream revenue, generating HKD 270 million, a decrease of 39.0% year-on-year[12]. - The sales of frozen meat products increased by 9.5% to HKD 154 million, representing about 28% of total revenue before internal sales[8]. Assets and Liabilities - As of June 30, 2024, the total assets of the group were HKD 958 million, a decrease of HKD 54 million from HKD 1,012 million on December 31, 2023[30]. - The total liabilities of the group as of June 30, 2024, were HKD 1,695 million, down by HKD 6 million from HKD 1,701 million on December 31, 2023[30]. - The net current liabilities amounted to HKD 1,019 million, with net debt of HKD 737 million and bank borrowings of HKD 465 million[31]. - The group has approximately HKD 364 million in non-current assets to support its ongoing operations despite being in a net debt position[31]. - The total equity attributable to the owners of the company was HKD (727,067,000) as of June 30, 2024, compared to HKD (694,969,000) at the end of 2023[59]. Cash Flow and Financing - The net cash used in operating activities was HKD 33,000 for the six months ended June 30, 2024, compared to HKD 7,386,000 in the previous year[62]. - The net cash used in investing activities was HKD 5,882,000 for the six months ended June 30, 2024, compared to HKD 5,035,000 in the previous year[62]. - The net cash used in financing activities was HKD 1,469,000 for the six months ended June 30, 2024, compared to HKD 2,323,000 in the previous year[62]. - The company is actively negotiating with banks regarding the renewal and waiver of certain loan covenants and is optimistic about its financial outlook[31]. - The company is actively negotiating with banks to update financing terms and seek additional funding sources to alleviate liquidity pressure[67]. - Certain bank borrowings totaling HKD 433,956,000 have become overdue, and the company is facing litigation from banks for repayment[66]. Management and Governance - The board has resolved not to declare an interim dividend for the review period, consistent with the previous year[42]. - The company has not granted any stock options under the new stock option plan since its adoption[45]. - The total number of stock options authorized for grant under the new stock option plan is 182,275,565[45]. - The total remuneration for key management personnel was HKD 1,318,000 for the six months ended June 30, 2024, down from HKD 1,373,000 for the same period in 2023[99]. Legal and Compliance - As of June 30, 2024, the group faced litigation from banks demanding immediate repayment of approximately HKD 434 million in bank loans[34]. - The company has outstanding bank loans totaling HKD 433,956,000 as of June 30, 2024, which have not met certain covenants[75]. Investments and Acquisitions - The company has no significant investments or plans for major acquisitions or capital asset purchases as of the report date[33]. - The company entered into an asset transfer agreement to sell property in Shanxi Province for a total consideration of RMB 51 million[53]. - On August 5, 2024, the group agreed to sell land and property in Xinjiang County for a total consideration of RMB 51,000,000 (approximately HKD 55,590,000)[100].

[Financial Statements and Summary](index=2&type=section&id=Financial%20Statements%20and%20Summary) [Consolidated Performance](index=2&type=section&id=Consolidated%20Performance) The Group's H1 2024 revenue declined by 29.9% year-on-year, yet improved gross margin and expense control significantly narrowed losses, with attributable loss to equity holders decreasing from HKD 20.2 million to HKD 10.07 million Consolidated Performance Overview (HKD Thousands) | Metric (HKD Thousands) | H1 2024 | H1 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 538,975 | 769,700 | -29.9% | | Gross Profit | 75,503 | 69,021 | +9.4% | | Operating Results | 11,606 | (27,942) | Turnaround to Profit | | Loss for the Period | (13,191) | (39,149) | -66.7% | | Loss Attributable to Equity Holders | (10,069) | (20,197) | -50.1% | | Basic Loss Per Share (HKD) | (0.006) | (0.011) | -45.5% | [Financial Position](index=4&type=section&id=Financial%20Position) As of June 30, 2024, the Group remained in a net liability position, which slightly worsened, with total liabilities stable but increased net current liabilities indicating ongoing liquidity pressure, alongside overdue bank borrowings and covenant breaches Financial Position Summary (HKD Thousands) | Metric (HKD Thousands) | June 30, 2024 | December 31, 2023 | Change | | :--- | :--- | :--- | :--- | | Total Assets | 957,909 | 1,011,951 | -54,042 | | Total Liabilities | 1,695,408 | 1,701,330 | -5,922 | | Net Current Liabilities | (1,018,661) | (979,241) | -39,420 | | Net Liabilities | (737,499) | (689,379) | -48,120 | - As of June 30, 2024, the Group's total bank borrowings were **HKD 465 million**, with some overdue and in breach of covenants, and these debts are included in a consolidated restructuring plan[7](index=7&type=chunk)[15](index=15&type=chunk) [Cash Flow](index=5&type=section&id=Cash%20Flow) During the period, the Group's operating cash outflow significantly decreased, but continuous net outflows from investing and financing activities led to a decline in cash and cash equivalents from HKD 39.3 million at the beginning of the period to HKD 31.67 million Cash Flow Summary (HKD Thousands) | Metric (HKD Thousands) | H1 2024 | H1 2023 | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (33) | (7,386) | | Net Cash Used in Investing Activities | (5,882) | (5,035) | | Net Cash Used in Financing Activities | (1,469) | (2,323) | | Net Decrease in Cash and Cash Equivalents | (7,384) | (14,744) | | Cash and Cash Equivalents at End of Period | 31,666 | 26,319 | [Going Concern Analysis](index=6&type=section&id=Going%20Concern%20Analysis) Auditors raised significant doubts about the Group's going concern ability due to substantial net current liabilities and net liabilities, along with overdue bank borrowings and litigation, while management's mitigation plans face significant uncertainties that may hinder asset realization and liability settlement in the normal course of business - As of June 30, 2024, the Group recorded a net loss of **HKD 13.19 million**, with net current liabilities reaching **HKD 1.019 billion** and net liabilities of **HKD 737 million**[7](index=7&type=chunk) - The Group has **HKD 434 million** in overdue bank borrowings and has breached several loan covenants, leading to litigation initiated by the relevant banks[7](index=7&type=chunk) - Management is taking measures to alleviate liquidity pressure, including negotiating renewals with banks, seeking waivers for default clauses, and expecting to resolve some debts through a consolidated restructuring plan; however, the success of these plans remains highly uncertain[7](index=7&type=chunk)[9](index=9&type=chunk) [Management Discussion and Analysis](index=15&type=section&id=Management%20Discussion%20and%20Analysis) [Industry and Business Review](index=15&type=section&id=Industry%20and%20Business%20Review) Facing challenges of insufficient domestic demand and declining pork consumption, the Group in H1 2024 focused on the 'Harbin Meat Union' brand, enhancing new product development and marketing, while strategically reducing production at low-profit facilities to improve overall profitability - Industry Background: In H1 2024, the domestic economy faced insufficient effective demand, with pork consumption projected to decline long-term, yet consumer trends are shifting towards high-quality, safe, and healthy products[31](index=31&type=chunk) - Business Strategy: The Group primarily operates under the 'Harbin Meat Union' brand, strengthening new product development and market promotion to meet diverse and quality-oriented consumer demands[32](index=32&type=chunk) [Segment Business Performance](index=16&type=section&id=Segment%20Business%20Performance) Upstream slaughtering revenue significantly declined due to strategic production cuts, but downstream processed meat products remained robust, with low-temperature meat products achieving counter-cyclical growth, becoming a core driver of stable revenue and profit, significantly enhancing the Group's overall gross margin Segment Revenue (HKD Millions) | Business Segment | H1 2024 Revenue (HKD Millions) | H1 2023 Revenue (HKD Millions) | YoY Change | | :--- | :--- | :--- | :--- | | Upstream - Chilled and Frozen Meat | 312 | 549 | -43.1% | | Downstream - Processed Meat Products | 227 | 232 | -2.2% | - High-value-added products performed prominently: - **Chilled meat** sales amounted to **HKD 270 million**, a 39.0% year-on-year decrease - **Low-temperature meat products** sales reached **HKD 154 million**, a 9.5% year-on-year increase, with their revenue contribution to downstream business rising from 61% to 68%[34](index=34&type=chunk)[40](index=40&type=chunk) [Financial Performance Analysis](index=17&type=section&id=Financial%20Performance%20Analysis) Despite a decline in total revenue, the Group's financial performance significantly improved, with overall gross margin substantially increasing from 9.0% to 14.0% driven by optimized high-margin downstream products, while operating expenses decreased by 33.5% year-on-year due to significant impairment provisions in the prior period, ultimately achieving a turnaround to operating profit Gross Margin by Segment | Gross Margin | H1 2024 | H1 2023 | Change (Percentage Points) | | :--- | :--- | :--- | :--- | | Group Overall | 14.0% | 9.0% | +5.0 | | Upstream Business | 1.4% | 1.1% | +0.3 | | Downstream Business | 31.4% | 25.8% | +5.6 | - Operating expenses were **HKD 66 million**, a 33.5% year-on-year decrease, primarily due to approximately **HKD 36 million** in non-current asset impairment losses recognized in the prior period[43](index=43&type=chunk) - Operating business achieved a profit of approximately **HKD 12 million**, compared to a loss of approximately **HKD 28 million** in the prior period, successfully turning losses into profits[44](index=44&type=chunk) - Net finance costs increased by 38.6% year-on-year to **HKD 25 million**, mainly due to increased accrued penalty interest from court judgments[45](index=45&type=chunk) [Financial Resources, Liquidity and Capital Structure](index=19&type=section&id=Financial%20Resources%2C%20Liquidity%20and%20Capital%20Structure) The Group's financial position remains severe with limited cash reserves and **HKD 434 million** in overdue bank borrowings and related litigation, which are part of a consolidated restructuring plan; management is actively communicating with banks and believes immediate repayment risk is low, yet significant uncertainty regarding going concern persists - As of June 30, 2024, cash and cash equivalents were approximately **HKD 32 million**, with total bank borrowings of **HKD 465 million**[48](index=48&type=chunk) - The Group failed to meet covenants for **HKD 434 million** in bank borrowings, which, along with **HKD 285 million** in interest, are overdue and included in a consolidated restructuring plan[49](index=49&type=chunk) - Management believes that despite defaults and litigation, ongoing communication with banks mitigates immediate repayment risk and will not materially adversely affect business operations[49](index=49&type=chunk) - The Group remains in a net liability position but possesses approximately **HKD 364 million** in non-current assets to support daily operations; management is confident in restoring a net asset position with economic improvement and internal efforts[50](index=50&type=chunk) [Human Resources and Environmental Responsibility](index=23&type=section&id=Human%20Resources%20and%20Environmental%20Responsibility) During the reporting period, the Group's total employee count decreased, while staff costs as a percentage of revenue remained stable; the company emphasizes protecting employee rights and actively fulfills environmental responsibilities by integrating green and low-carbon concepts into daily operations - As of June 30, 2024, the Group employed approximately **800 staff**, a decrease from approximately **1,000 staff** at the end of 2023[54](index=54&type=chunk) - Total staff costs for H1 were **HKD 35 million**, representing 6.4% of revenue (H1 2023: **HKD 51 million**, 6.6% of revenue)[54](index=54&type=chunk) - The Group actively promotes energy conservation, emission reduction, and circular economy, fostering green production methods through measures such as energy saving, recycling, and green packaging[55](index=55&type=chunk) [Corporate Governance and Other Matters](index=24&type=section&id=Corporate%20Governance%20and%20Other%20Matters) [Corporate Governance Practices](index=24&type=section&id=Corporate%20Governance%20Practices) The company generally complies with corporate governance codes, with one deviation: Ms. Zhu Yuan serves as both Board Chairman and CEO; the Board believes this arrangement currently facilitates efficient decision-making and business management, with long-term plans to identify a suitable CEO - The company deviates from the Corporate Governance Code's requirement for distinct roles between Chairman and CEO, as Ms. Zhu Yuan serves concurrently as Board Chairman and Chief Executive Officer[57](index=57&type=chunk) - The Board believes the current arrangement allows for more effective formulation and execution of business strategies, and with over half of the Board comprising independent non-executive directors, power balance is ensured[57](index=57&type=chunk) [Events After Reporting Period](index=14&type=section&id=Events%20After%20Reporting%20Period) Subsequent to the reporting period, an indirect non-wholly owned subsidiary of the Group signed an agreement to sell land and properties in Xinjiang County, China, for RMB 51 million (approximately HKD 55.59 million), with the transaction completed on August 5, 2024 - On August 5, 2024, Xinjiang Qixing, an indirect non-wholly owned subsidiary of the company, agreed to sell land and properties to Yuncheng Yuanhui Logistics Co Ltd for a total consideration of **RMB 51 million**[29](index=29&type=chunk)[61](index=61&type=chunk)

Financial Performance - In 2023, the company achieved revenue of HKD 1.411 billion, a decrease from HKD 2.162 billion in 2022, representing a decline of approximately 34.6%[19] - The loss attributable to equity holders was HKD 148 million, compared to a loss of HKD 15 million in 2022, indicating a significant increase in losses[19] - The sales revenue from deep-processed meat products was HKD 445 million, down from HKD 496 million in 2022, reflecting a decrease of about 10.3%[22] - The company recorded a net loss of approximately HKD 105 million from other activities, compared to a net income of HKD 27 million in 2022, primarily due to the assessment of certain non-operational facilities[23] - The sales revenue of chilled meat was HKD 835 million, a decrease of 43.1% compared to HKD 1.468 billion in 2022, accounting for approximately 59% of total revenue[36] - The revenue from low-temperature meat products was HKD 271 million, a decrease of 4.9% from HKD 285 million in 2022, representing about 19% of total revenue[36] - The slaughter volume decreased by approximately 19.8% to about 500,000 heads compared to the previous year[38] - Operating expenses for the year were HKD 177 million, accounting for 12.6% of total revenue, compared to 5.6% in 2022[43] - The total employee cost for the year was HKD 99 million, accounting for 7.0% of revenue, compared to HKD 106 million and 4.9% in 2022[52] - The group reported a loss attributable to equity holders of approximately HKD 695 million as of December 31, 2023[68] Production and Capacity - The production capacity for upstream slaughtering and downstream deep-processed meat products remained stable at approximately 3.35 million heads and 56,000 tons, respectively[18] - The domestic live pig output was 727 million heads in 2023, an increase of 3.8% year-on-year, while pork production reached 57.94 million tons, up 4.6%[10] - The average procurement price of live pigs was RMB 15.35 per kilogram, a year-on-year decrease of 19.3%[34] - The average procurement price of live pigs fluctuated between RMB 14.26 and 17.14 per kilogram during the review period[140] - The company has established a management mechanism to negotiate with at least three suppliers for the supply of live pigs and meat[138] Strategic Focus and Innovation - The company plans to continue focusing on innovation and quality management to enhance operational efficiency and competitiveness in 2024[8] - The company aims to develop new products that cater to changing consumer demands and trends, driving new growth points for performance[29] - The company is cautious in new product development, gradually introducing products that meet consumer demand through trial phases[142] Environmental and Social Responsibility - The group is committed to green low-carbon production methods and has increased investment in environmental protection and R&D[54] - The group aims to integrate energy-saving and green production concepts into its corporate culture for sustainable development[54] - The company is focused on reducing waste emissions during production processes to promote green transformation[54] - The group recognizes its responsibility as a public company and actively implements environmental protection measures[74] - The company has measures in place to minimize the impact of animal diseases or other epidemics on its business operations[130] Governance and Compliance - The company has adhered to the corporate governance code as per the Hong Kong Stock Exchange rules during the review year[78] - The board is responsible for approving and monitoring the overall strategy and policies of the group, including annual budgets and business plans[79] - The audit committee reviewed the group's annual and interim financial statements before submission to the board for approval[93] - The company has implemented a risk management and internal control system to ensure effective governance and compliance with the corporate governance code[89] - The company has established an audit committee, remuneration committee, and nomination committee to ensure compliance with the corporate governance code[88] Financial Risks and Debt Management - The company is currently in a net debt position as of December 31, 2023, with risks of failing to meet financial obligations[144] - The company has two overdue bank loans from state-owned commercial banks in China, and it is actively communicating with these banks to negotiate repayment plans and reduce penalties[196] - The board believes that the action plan to address overdue bank loans, if implemented as expected, will eliminate the auditor's uncertainty regarding the company's going concern status[198] - The company believes it has sufficient financial resources to support its operations and meet financial obligations due within the next twelve months[192] Shareholder Communication and Transparency - The company aims to provide high levels of information disclosure and financial transparency to shareholders and potential investors[158] - The company has adopted a shareholder communication policy to ensure shareholders can conveniently and timely access fair and understandable information[179] - The board of directors has reviewed the effectiveness of the shareholder communication policy, deeming it reasonable and effectively implemented[159] Quality Control and Supply Chain Management - The company has implemented a comprehensive quality control system with 21 inspection and quarantine processes for its products[148] - The company conducts regular assessments of supplier production sites to ensure the quality and supply capacity of raw materials[140] - The company emphasizes the quality and supply of raw materials, implementing measures to ensure supply chain stability, including contractual guarantees with suppliers[122] - The company has developed different strategies to cope with fluctuations in raw material prices, such as adjusting pig inventory based on expected price changes[124] Board Diversity and Effectiveness - The board consists of five members, including three independent non-executive directors, ensuring a diverse range of expertise in accounting, legal, and food engineering[96] - The board's gender diversity includes two female directors and three male directors, highlighting the company's commitment to gender representation[96] - The company emphasizes the importance of board diversity, considering factors such as gender, age, cultural background, and professional experience in its selection process[95] - The board has established a policy to review its diversity and effectiveness annually, ensuring continuous improvement in governance practices[95] Crisis Management - The company has established a crisis response procedure to quickly address any incidents that may affect consumer confidence[153] - The company has the capability to ensure product distribution and sales during disease outbreaks due to its nationwide layout[147]

Financial Performance - For the fiscal year ending December 31, 2023, the company reported total revenue of HKD 1,410,943,000, a decrease of 34.6% compared to HKD 2,162,440,000 in 2022[4] - The net loss for the year was HKD 201,293,000, significantly higher than the loss of HKD 25,329,000 reported in 2022, indicating a deterioration in financial performance[4] - The company’s total comprehensive loss for the year was HKD 194,786,000, compared to a loss of HKD 24,974,000 in the prior year[6] - The total reported segment revenue for 2023 was HKD 1,424,788,000, compared to HKD 2,166,027,000 in 2022, indicating a decrease of about 34.2%[31] - The total revenue for the fresh and frozen meat segment in 2023 was HKD 966,400,000, a decrease of 42% from HKD 1,666,115,000 in 2022[28] - The processed meat products segment generated revenue of HKD 444,543,000 in 2023, down from HKD 496,325,000 in 2022, representing a decline of approximately 10.4%[28] - The group reported other net losses of approximately HKD 105 million, primarily due to the write-off of non-productive assets and expected VAT recoveries[88] - The group reported an operating loss of approximately HKD 170 million, compared to a profit of approximately HKD 18 million in the previous year[91] Assets and Liabilities - As of December 31, 2023, the total equity attributable to the company's shareholders was HKD (689,379,000), a decline from HKD (494,593,000) in 2022[11] - The company’s current liabilities amounted to HKD 1,617,367,000, with a net current liability of HKD (979,241,000)[10] - The company’s non-current assets, including property, plant, and equipment, decreased to HKD 326,449,000 from HKD 449,037,000 in 2022[10] - The company’s total liabilities increased to HKD 1,170,268,000 in 2023 from HKD 1,122,566,000 in 2022, indicating a rise of approximately 4.2%[53] - The company’s accounts payable decreased to HKD 171,617,000 in 2023 from HKD 191,633,000 in 2022, a decline of about 10.5%[53] - The group’s total liabilities increased to HKD 1.701 billion as of December 31, 2023, up by HKD 30 million from HKD 1.672 billion on December 31, 2022[114] - The group’s property, plant, and equipment decreased to HKD 326 million from HKD 449 million the previous year, primarily due to an impairment loss of HKD 56 million[105] Cash Flow and Financing - The company’s cash and cash equivalents stood at HKD 39,298,000, an increase from HKD 33,210,000 in the previous year[10] - The company plans to actively negotiate with banks to update financing terms and seek additional funding sources to alleviate liquidity pressure[17] - The company had bank borrowings totaling HKD 437,069,000 as of December 31, 2023, slightly down from HKD 443,381,000 in 2022[55] - The group’s current and non-current bank borrowings amounted to HKD 446,196,000 and HKD 22,029,000, respectively, with cash and cash equivalents of only HKD 39,298,000[61] - The group is involved in a lawsuit with a bank for immediate repayment of HKD 437,069,000, with a judgment requiring repayment of HKD 506,208,000 including interest[62] - The group successfully negotiated a debt settlement with a bank for an outstanding debt of HKD 43,434,000 and interest of HKD 19,347,000, resulting in a debt settlement gain of HKD 12,713,000[60] - The group has two overdue bank loans from state-owned commercial banks in China and is negotiating for installment repayments and waivers on penalties[144] Shareholder Returns - The company did not recommend the distribution of dividends for the year ended December 31, 2023, consistent with the previous year[46] - The group will not declare a final dividend for the year ending December 31, 2023[66] Operational Insights - The group’s pig production volume for 2023 was 727 million heads, an increase of 3.8% year-on-year, while pork production reached 57.94 million tons, up 4.6% year-on-year[68] - The group is focusing on product quality and research and development to adapt to market changes[70] - The group anticipates steady growth in pork consumption driven by rising incomes and demand for processed meat products[68] - The group maintained an annual production capacity of approximately 3.35 million heads for upstream slaughtering and 56,000 tons for downstream deep-processed meat products as of December 31, 2023[79] Employee and Operational Costs - As of December 31, 2023, the group employed approximately 1,000 staff in mainland China and Hong Kong, a decrease from approximately 1,400 staff as of December 31, 2022[136] - Total employee costs for the year amounted to HKD 99 million, representing 7.0% of revenue, compared to HKD 106 million or 4.9% of revenue in 2022[136] Future Outlook and Strategic Plans - The board is optimistic about returning to a net asset position as the economic environment improves and management continues to enhance operational profitability[116] - The board anticipates that the "disclaimer of opinion" in the auditor's report may be removed by December 31, 2024, depending on the success of the action plan[121] - The company plans to exercise caution in capital expenditures for 2024, with an initial budget of approximately RMB 15 million primarily for ongoing projects and maintenance[132] - The group is committed to green low-carbon production methods and has increased investments in environmental protection and R&D[138] - The group aims to integrate energy-saving and green production concepts into its corporate culture for sustainable development[138] Audit and Compliance - The independent auditor's report indicated "unable to express an opinion" regarding the group's ability to continue as a going concern due to various uncertainties[139] - The audit committee has rigorously reviewed the financial statements and aligned its views with the board regarding the going concern basis[142] Challenges and Risk Management - The group is actively addressing challenges, including business losses and overdue bank loans, while maintaining regular communication with banks[141] - The communication process with banks involves multiple approval levels, which can extend the timeline for reaching a resolution[144]

Financial Performance - In the first half of 2023, the group's revenue was HKD 770 million, a decrease of 21.4% compared to HKD 979 million in the same period of 2022[35]. - The group recorded a loss attributable to equity holders of approximately HKD 20 million, compared to a loss of HKD 11 million in the first half of 2022[35]. - Fresh meat sales amounted to HKD 443 million, a decrease of 31.3% from HKD 644 million in the first half of 2022, accounting for approximately 57% of total revenue before internal sales[35]. - The sales revenue of deep-processed meat products was HKD 232 million, a decrease of approximately 10.2% compared to HKD 258 million in the first half of 2022[18]. - Revenue from low-temperature meat products was HKD 140 million, a decrease of approximately 3.1% compared to HKD 145 million in the same period last year, accounting for about 18% of total revenue before internal sales[65]. - Revenue from high-temperature meat products was HKD 92 million, down from HKD 113 million in the same period last year, representing approximately 12% of total revenue before internal sales[65]. - For the six months ended June 30, 2023, the company reported total revenue of HKD 549,207,000, a decrease of 24% compared to HKD 721,623,000 for the same period in 2022[173]. - Total revenue for the six months ended June 30, 2023, was HKD 780,918,000, a decrease of 20.2% compared to HKD 979,630,000 for the same period in 2022[194]. Profitability and Loss - The overall gross profit increased by 4.2% to HKD 69 million, with the overall gross margin rising by 2.2 percentage points to 9.0% compared to 6.8% in the same period last year[19]. - The gross margin for downstream processed meat products increased to 25.8%, up 6.9 percentage points from 18.9% in the same period last year[41]. - The operating loss for the review period was approximately HKD 28 million, compared to a profit of approximately HKD 9 million in the same period last year[71]. - The company incurred a total comprehensive loss of HKD 22,313,000 for the six months ended June 30, 2023[138]. - The consolidated loss for the period was HKD 39,149,000, compared to a loss of HKD 16,135,000 in the previous year, indicating a significant increase in losses[194]. - Basic and diluted loss per share for the period was HKD 0.011, compared to HKD 0.006 in the previous year[150]. Operating Expenses - The operating expenses for the period were HKD 99 million, which included a provision for impairment losses of HKD 36 million, compared to HKD 62 million in the first half of 2022[24]. - The overall operating expenses, excluding impairment losses, were HKD 63 million, which is comparable to the previous year, accounting for 8.2% of total revenue[24]. - Employee costs for the review period totaled HKD 51 million, representing 6.6% of revenue, compared to HKD 55 million and 5.6% of revenue in the first half of 2022[113]. - The company’s total personnel expenses for the six months ended June 30, 2023, were HKD 50,616,000, a decrease of 8.2% from HKD 54,998,000 in the previous year[197]. Assets and Liabilities - Total assets as of June 30, 2023, were HKD 1.139 billion, a decrease of HKD 38 million from HKD 1.177 billion as of December 31, 2022[53]. - Total liabilities decreased by HKD 32 million to HKD 1.640 billion as of June 30, 2023, compared to HKD 1.672 billion at the end of 2022[53]. - As of June 30, 2023, the company's outstanding bank loans amounted to HKD 469 million, a decrease of HKD 15 million from HKD 484 million at the end of the previous year[72]. - As of June 30, 2023, the company's current liabilities and total liabilities were HKD 982,359,000 and HKD 500,934,000, respectively[188]. - The company has approximately HKD 572 million in non-current assets to support daily operations despite being in a net debt position[55]. Strategic Focus and Management - The company plans to focus on high-margin products and adjust its product structure to balance profit and market demand[18]. - The company aims to leverage its core competitiveness in resources, strategy, and branding to capture opportunities in the evolving meat market[30]. - The company has established a systematic quality management system to ensure product quality meets high standards[10]. - The company has established a risk management and internal control system to safeguard assets and manage business risks[107]. - The company is actively communicating with banks regarding the renewal and waiver of loan covenants and is implementing operational plans to enhance profitability and generate sufficient cash flow[83]. Corporate Governance - The company has maintained a high standard of corporate governance, with a board composed of experienced individuals and a majority of independent non-executive directors[130]. - The company has adopted a set of comprehensive corporate governance measures to enhance shareholder value[129]. - No new share options were granted under the new share option scheme since its adoption[99]. - The company has not entered into any arrangements that would allow directors to benefit from purchasing shares or debt securities of the company or any other corporate body during the review period[105]. Market Conditions and Trends - The total number of live pigs slaughtered in China reached 375.48 million, an increase of 2.6% year-on-year, with pork production at 30.32 million tons, up 3.2% year-on-year[30]. - The company noted that its operations are affected by seasonal fluctuations, with demand for processed meat products peaking around the Lunar New Year[174]. - The company experienced a significant increase in litigation provisions, with approximately HKD 229,000 related to patent infringement claims in China for the six months ended June 30, 2023[175].

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責， 對其準確性或完整性亦不發表任何聲明，並明確表示概不就因本公告全部或任何 部份內容而產生或因依賴該等內容而引致之任何損失承擔任何責任。 CHINA YURUN FOOD GROUP LIMITED * 中 國 雨 潤 食 品 集 團 有 限 公 司 （於百慕達註冊成立之有限公司） （股份代號：1068） 截至二零二三年六月三十日止六個月 中期業績公佈 中國雨潤食品集團有限公司（「本公司」或「雨潤食品」）董事會（「董事會」或「董事」） 公佈本公司及其附屬公司（統稱「本集團」）截至二零二三年六月三十日止六個月（「回 顧期」）之未經審核綜合中期業績。回顧期的中期財務報告雖未經審核，但已由本 公司的審核委員會審閱。 ...

Financial Performance - The company's revenue for 2022 was HKD 2.162 billion, with a net loss attributable to equity holders of HKD 15 million. The loss from main business operations was HKD 34 million, a significant reduction of 91.8% year-on-year[26] - Revenue for 2022 was HKD 2.162 billion, a significant decrease from HKD 8.440 billion in 2021, primarily due to the exclusion of subsidiaries from consolidation and a one-time gain of HKD 3.491 billion recognized in 2021[61] - Net loss attributable to equity holders in 2022 was HKD 15 million, compared to a net profit of HKD 3.060 billion in 2021, with a core business loss of HKD 34 million[61] - The group's overall gross profit decreased from HKD 398 million in 2021 to HKD 113 million in 2022, but the gross margin improved by 0.5 percentage points to 5.2% due to a focus on higher-margin products[65] - The group's operating profit for 2022 was HKD 18 million, a significant decrease from HKD 3.076 billion in 2021, primarily due to the absence of a one-time gain from the exclusion of subsidiaries from consolidation[94] Debt and Liabilities - The company's outstanding bank loans as of December 31, 2022, were HKD 484 million, a decrease of HKD 60 million compared to HKD 544 million on December 31, 2021. HKD 453 million of the bank loans are due within one year[6] - The company's equity attributable to shareholders was a loss of approximately HKD 543 million as of December 31, 2022, making it unsuitable to calculate the capital-to-debt ratio[19] - The group's total assets decreased by HKD 130 million to HKD 1.177 billion, while total liabilities decreased by HKD 105 million to HKD 1.672 billion as of December 31, 2022[75] - The company's net current liabilities were HKD 1.038 billion as of December 31, 2022, compared to HKD 1.193 billion in the previous year[106] - Current bank borrowings amounted to HKD 453 million as of December 31, 2022, down from HKD 544 million in the previous year[106] - The group is in discussions with banks to resolve litigation related to HKD 443 million in overdue bank loans as of December 31, 2022[80] - Accounts receivable of approximately HKD 12 million were used as collateral for bank loans totaling HKD 41 million as of December 31, 2022[104] Cash Flow and Capital Expenditures - The group's cash and cash equivalents decreased by HKD 47 million to HKD 33 million as of December 31, 2022, with 79% denominated in RMB and 15% in USD[71] - Cash and cash equivalents stood at approximately HKD 33 million as of December 31, 2022, a decrease from HKD 80 million in the previous year[106] - Capital expenditures for 2022 were HKD 5 million, significantly lower than the HKD 148 million spent in 2021[73] - The group plans to allocate approximately RMB 15 million for capital expenditures in 2023, primarily for ongoing construction projects, factory maintenance, and equipment updates[78] - No significant investments or acquisitions of capital assets were made during the year, and no such plans exist as of the reporting date[105] Business Operations and Strategy - The company's restructuring plan was approved at a creditors' meeting on January 28, 2022, and officially entered the implementation phase, focusing on the production and operation of the "Ha Lian" brand products[29] - The company's restructuring plan was approved by creditors and the Nanjing Intermediate People's Court on January 28, 2022, leading to improved operating performance[38] - The company plans to continue implementing its restructuring plan to improve debt structure and enhance profitability, aiming for a new development phase[49] - In 2023, the company plans to expand its product range, including Chinese-style marinated products, European-style sausages, local specialties, and pre-made dishes, while upgrading the operational model of its "Ha Da Zhong" hot marinated fresh smoked new model chain stores[31] - The company plans to implement operational strategies to improve profitability, control costs, and generate sufficient operating cash flow[106] - The Board believes the company has sufficient financial resources to support its operations and meet financial obligations for the next 12 months[106] Product and Market Performance - The average purchase price of live pigs in 2022 decreased by approximately 30.4% compared to 2021, and the slaughter volume decreased to approximately 620,000 heads (2021: 1.64 million heads) due to changes in the scope of consolidation[15] - The gross profit margin for low-temperature meat products increased by 0.4 percentage points to 18.0%, while the gross profit margin for high-temperature meat products decreased by 1.3 percentage points to 18.8%. The overall gross profit margin for downstream products increased slightly by 0.1 percentage points to 18.4%[16] - The upstream business revenue decreased to HKD 1.670 billion in 2022 from HKD 6.810 billion in 2021, with chilled meat accounting for 68% of total revenue and 88% of upstream revenue[62] - Low-temperature meat products generated revenue of HKD 285 million, accounting for 57% of the deep-processed business revenue, while high-temperature meat products contributed HKD 211 million, representing 10% of the group's total revenue and 43% of the deep-processed business revenue[65] - The company's "Ha Rou Lian" brand, established in 1913, focuses on low-temperature meat products, with key products including Harbin red sausage, canned meat, and marinated products[46] - The company's "Ha Rou Lian" brand has received numerous awards and certifications, including ISO9001, ISO14001, OHSAS18001, and ISO22000, reflecting strong market recognition[40] - The company's subsidiary, Harbin Dazhong Rou Lian Food Co., Ltd., was recognized as a "China 3.15 Integrity Enterprise" in 2022, highlighting its commitment to product quality[57] Industry and Economic Context - The national pig inventory at the end of 2022 was 452.56 million heads, a year-on-year increase of 0.7%, while pig slaughter reached 699.95 million heads, up 4.3% year-on-year[45] - China's GDP in 2022 was RMB 121.0207 trillion, a 3.0% increase from the previous year, with the CPI rising by 2.0% and catering revenue declining by 6.3% to RMB 4.3941 trillion[54] - The annual production capacity of the group's upstream slaughtering and downstream deep-processed meat products businesses remained consistent at approximately 3.35 million heads and 56,000 tons, respectively, as of December 31, 2022[64] Cost Management and Efficiency - Operating expenses decreased to HKD 121 million, representing 5.6% of the group's revenue, down from HKD 836 million (9.9% of revenue) in 2021, primarily due to cost control measures and changes in consolidation scope[67] - The company has implemented a management mechanism to negotiate with at least three or more suppliers for the supply of live pigs, raw meat, or other key raw materials, ensuring a reasonable procurement ratio from each supplier[164] - The company has established safety stock for different raw materials based on sales market forecasts to handle emergencies[182] - The company's average procurement price for live pigs in 2022 fluctuated between RMB 11.9 to RMB 26.7 per kilogram[184] - The company has formulated different strategies for upstream and downstream businesses to mitigate cost pressures from raw material price fluctuations[166] Risk Management and Compliance - The company maintains a risk management and internal control system to manage risks and provide reasonable assurance against material misstatements or losses[160] - The company has adopted a cautious strategy for new product development and promotion, involving small-scale trials, medium-scale trials, and production stages[167] - The company has diversified its market penetration across different regions to reduce the impact of economic fluctuations and reliance on specific markets[163] - The company has signed cooperation agreements with suppliers that include clauses ensuring stable supply and quality safety[164] - The company regularly visits supplier production sites to assess the quality and supply capacity of raw materials[166] - The company continuously analyzes product sales and eliminates low-performing products while innovating and improving to maintain product quality[167] - The company's business is susceptible to fluctuations in raw material prices, particularly live pigs and raw meat, which may impact profitability if cost increases cannot be fully passed on to consumers[184] - Strategic raw material reserves to control costs and gain time for price adjustments in the sales market, potentially leading to decreased demand for the company's products[185] - Dependence on understanding and adapting to changing consumer tastes and dietary habits for sustained success in the deep-processed meat products market[185] - Significant costs associated with developing and marketing new products or expanding existing production lines, with no guarantee of market acceptance, sales, or profit[185] - Requirement for multiple licenses and permits to operate, including slaughter permits for fresh and frozen meat production facilities and industrial product production permits for deep-processed meat products facilities[187] - Regular inspections by regulatory authorities to ensure compliance with applicable hygiene and food safety standards, with potential business disruptions if inspections are failed or licenses are not renewed[187] - Impact of financial risks including market, liquidity, and credit risks on the company's financial condition, operating performance, and business[188] - Potential adverse effects on the company's business and revenue due to the impact of COVID-19 on retail markets and the possibility of severe animal diseases such as African swine fever[192] - Enhanced disease monitoring by the company's pig procurement and quality management departments to increase inspection and quarantine in areas with outbreaks and reduce or stop purchases from affected regions[193] - Implementation of a nationwide production base network for local procurement, production, and sales, with temperature-controlled delivery vehicles equipped with GPS and temperature monitoring systems[198] - Internal audit department's role in identifying major risk areas and establishing appropriate monitoring measures and management strategies to reduce overall business and operational risks[199] Corporate Governance and Human Resources - The Board consists of five members, including two executive directors and three independent non-executive directors[116] - The Board of Directors is responsible for approving and overseeing the group's overall strategy, annual budget, and business plans[138] - The company has purchased appropriate insurance for directors and executives to cover liabilities arising from the group's business, with annual reviews of the coverage[145] - The Board of Directors includes five members, with three being independent non-executive directors, ensuring diversity in gender, age, education, and professional experience[158] - The company employed approximately 1,400 employees in mainland China and Hong Kong as of December 31, 2022, compared to 1,500 employees in the previous year[133] - Total employee costs for the year amounted to HKD 106 million, accounting for 4.9% of the group's revenue, consistent with the previous year's percentage[133] - The company provides competitive compensation and benefits, including performance-based bonuses and employee stock option plans[109] - The company is committed to environmental protection and aims to improve measures to reduce waste generation in the future[134]