Financial Performance - In 2019, China Yurun Food Group achieved a revenue of HKD 15.225 billion, an increase of 20.3% compared to HKD 12.651 billion in the previous year[15]. - The company's attributable loss to equity holders was HKD 3.940 billion, a significant reduction of approximately 17.2% from HKD 4.759 billion in 2018[15]. - The group reported a loss attributable to equity holders of HKD 598 million in 2019, a reduction of approximately 7.6% from HKD 648 million in 2018[37]. - The company reported a net loss of HKD 3.940 billion attributable to equity holders, a reduction of 17.2% from the previous year[52]. - Overall gross profit increased by 16.5% to HKD 1.125 billion, while the overall gross margin slightly decreased to 7.4%[44]. - Operating expenses decreased by 15.5% to HKD 4.429 billion, with a significant reduction in promotional, transportation, and wage costs[45]. - The company improved its net loss to HKD 598 million in 2019, a reduction of 7.6% compared to 2018[80]. - Operating cash flow significantly increased to approximately HKD 82 million in 2019, up from HKD 7.8 million in 2018, indicating effective management measures[81]. - The company has sufficient financial resources to support operations and meet financial obligations due within the next twelve months[75]. - The company’s auditor's responsibility statement is included in the independent auditor's report within the annual report[175]. Market and Product Strategy - The company plans to focus on high-value products such as chilled and frozen meat, aiming to enhance product quality and service while expanding sales channels[19]. - The group plans to enhance its product structure and invest in R&D to meet market demand, aiming to maintain its leading position in the industry[32]. - The company aims to optimize its product structure and adjust sales channels in response to market changes to enhance profitability[15]. - The company aims to attract younger consumers by developing new packaging and marketing strategies while maintaining high product quality[32]. - The company has adopted a cautious strategy for new product development, gradually introducing products that meet consumer demand through trial phases[151]. - The company is focusing on market penetration in different regions to mitigate the impact of economic fluctuations on its business[142]. Operational Challenges and Responses - The management emphasizes the importance of food safety and operational security, integrating resources to capitalize on industry consolidation opportunities[19]. - The company anticipates ongoing negative impacts from external factors on its business in 2020, including the economic downturn and industry challenges[39]. - The management team is committed to overcoming challenges and ensuring stable business development amidst a complex economic environment[20]. - The company has implemented measures to minimize the impact of animal diseases, including enhanced disease monitoring and the ability to ensure product distribution during outbreaks[160]. - The company has established emergency plans to prevent disruptions in raw material supply based on media reports and supplier information[146]. Governance and Management - The board believes that the combination of the roles of chairman and CEO will enhance the effectiveness of business strategy formulation and execution[88]. - The chairman and CEO, Zhu Yuan, was appointed on March 28, 2019, and has led the group’s overall corporate development and high-level strategic direction[93]. - The board consists of members with diverse backgrounds and expertise, enhancing the group's core capabilities in industry knowledge and management experience[93]. - The company encourages directors to participate in professional development courses to enhance their knowledge and skills[100]. - The audit committee is responsible for overseeing compliance with the Corporate Governance Code and reviewing the company's governance policies[101]. Financial Position and Liabilities - The group's total assets as of December 31, 2019, were HKD 9.681 billion, down HKD 3.995 billion from HKD 13.676 billion on December 31, 2018[57]. - The total liabilities increased to HKD 10.998 billion as of December 31, 2019, from HKD 10.851 billion on December 31, 2018, an increase of HKD 146 million[57]. - The net debt to total capital ratio as of December 31, 2019, was 121.4%, up from 69.1% on December 31, 2018[62]. - The group was unable to meet covenants on certain bank borrowings totaling HKD 4.937 billion as of December 31, 2019[56]. - The group has approximately 9,400 employees as of December 31, 2019, down from about 10,000 in 2018[70]. Risk Management - The company faces financial risks including market, liquidity, and credit risks that could significantly impact its financial condition and operating performance[156]. - The company has a system in place to ensure compliance with national and regional laws and regulations regarding production licenses and permits[155]. - The internal audit department conducts regular reviews of financial, operational, and compliance controls to mitigate overall business risks[168]. - The board of directors has authorized the audit committee to oversee the effectiveness of risk management and internal control systems[166]. Food Safety and Quality Control - The company has established a comprehensive food safety control system with 21 inspection and quarantine processes to ensure product quality from production to distribution[161]. - The company is committed to maintaining high standards for product quality, exceeding industry and national benchmarks[165]. - The company has invested in advanced meat processing equipment from Europe to automate operations and minimize contamination risks[162]. - The company maintains a cold chain transportation system, ensuring that products are transported at a controlled temperature of 0.4 degrees Celsius[165]. Shareholder Communication - The company aims to provide high levels of disclosure and financial transparency to shareholders and potential investors[176]. - The company has established multiple communication channels to keep shareholders and potential investors updated on business developments[178]. - The company regularly reviews and updates its investor relations webpage to cover all important information[178]. - Shareholders holding at least 10% of the paid-up capital have the right to request the board to convene a special general meeting[180].

Financial Performance - For the first half of 2019, China Yurun Food Group recorded revenue of HKD 7.392 billion, an increase of 20.9% compared to HKD 6.115 billion in the same period last year[16]. - The sales revenue from fresh meat was HKD 5.450 billion, a 20.4% increase from HKD 4.526 billion in the first half of 2018, accounting for approximately 72% of total revenue[14]. - The group reported a loss attributable to equity holders of HKD 448 million, a reduction of approximately 17.3% from HKD 542 million in the same period last year[16]. - The group’s loss from core operations, excluding government subsidies and other losses, was HKD 340 million, a decrease of approximately 14.8% from HKD 399 million in the previous year[16]. - The overall gross profit increased by 22.8% to HKD 5.17 billion, with a gross profit margin of 7.0%, up from 6.9% in the same period last year[20]. - The net loss attributable to equity holders was HKD 4.48 billion, a reduction of approximately 17.3% compared to HKD 5.42 billion in the first half of 2018[23]. - The group recorded a net loss of HKD 4.48 billion for the first half of 2019, an improvement from a net loss of HKD 5.42 billion in the same period of 2018[33]. - The group reported a total loss before tax of HKD (111,223,000) for the six months ended June 30, 2019, a significant improvement from a loss of HKD (305,157,000) in the same period of 2018[116]. - The total comprehensive loss for the period was HKD 531,684, slightly improved from HKD 567,581 in the previous year[70]. Operational Metrics - The total number of pigs slaughtered in the first half of 2019 was 313 million, a decrease of 6.2% compared to the previous year, due to supply constraints[8]. - The average procurement price of live pigs increased by 13.4% during the review period, reflecting the impact of the African swine fever on the market[10]. - The average procurement price of live pigs increased by 13.4% compared to the first half of 2018, with a slaughter volume of approximately 3.78 million heads, representing a year-on-year increase of about 16.9%[18]. - The production capacity for upstream slaughtering and downstream processed meat products remained stable at approximately 52.65 million heads and 312,000 tons, respectively[15]. - The overall sales revenue of upstream business (before internal sales offset) increased by 27.2% to HKD 6.432 billion, compared to HKD 5.057 billion in the first half of 2018[18]. - Fresh meat accounted for approximately 72% of total revenue (before internal sales offset) and 85% of upstream total revenue, reaching HKD 5.450 billion, a year-on-year increase of 20.4%[18]. - The sales revenue of deep-processed meat products was HKD 1.089 billion, a decrease of 8.8% compared to HKD 1.194 billion in the first half of 2018[19]. Financial Position - As of June 30, 2019, the total assets of the group were HKD 13.144 billion, a decrease of HKD 0.532 billion (3.9%) compared to December 31, 2018[28]. - The total liabilities of the group as of June 30, 2019, were HKD 10.851 billion, a slight decrease of approximately HKD 2 million compared to December 31, 2018[28]. - The group's current liabilities net amount was HKD 7.366 billion as of June 30, 2019, compared to HKD 7.264 billion on December 31, 2018[33]. - The total debt to total equity ratio increased to 75.8% as of June 30, 2019, up from 72.1% on December 31, 2018, representing an increase of 3.7 percentage points[34]. - The company’s total equity attributable to owners decreased from HKD 2,774,095 thousand in December 2018 to HKD 2,241,146 thousand in June 2019, a decrease of approximately 19.2%[79]. - The company’s net asset value decreased from HKD 2,824,823 thousand in December 2018 to HKD 2,293,139 thousand in June 2019, a decline of around 18.8%[75]. - The group’s total bank and other loans were HKD 6,368,337,000 for current loans and HKD 572,752,000 for non-current loans as of June 30, 2019, showing a slight increase from HKD 6,355,546,000 and HKD 703,678,000 respectively as of December 31, 2018[86]. Cash Flow and Liquidity - The company reported a net cash outflow from operating activities of HKD 5,183 thousand for the six months ended June 30, 2019, compared to an outflow of HKD 76,483 thousand for the same period in 2018[82]. - The group has taken measures to alleviate liquidity pressure, including negotiating with banks for waivers and additional financing, and implementing operational plans to improve profitability and cash flow[88]. - The group’s bank deposits were frozen by Chinese courts amounting to HKD 37,215,000 as of June 30, 2019, compared to HKD 22,043,000 as of December 31, 2018, reflecting a 68.9% increase in frozen assets[86]. - The group failed to meet certain bank loan covenants totaling HKD 5,004,099,000 as of June 30, 2019, which included ongoing litigation amounting to HKD 2,133,475,000[86]. - The board believes that the group has sufficient financial resources to support its operations for the next twelve months based on cash flow forecasts and the effectiveness of the measures taken[88]. Corporate Governance and Compliance - The company has maintained a high standard of corporate governance, ensuring transparency and accountability in its operations[62]. - The group has no significant pending or threatening litigation or claims as of June 30, 2019, and management believes any potential legal liabilities will not have a significant impact on the financial position and performance[148]. - The group has adopted several new and revised International Financial Reporting Standards, which may not have a significant impact on the consolidated financial statements in the foreseeable future[90]. - The group has implemented the cumulative effect method for the adoption of IFRS 16, which significantly changes the accounting treatment for leases, affecting the recognition of right-of-use assets and lease liabilities[91]. Employee and Management Information - The group employed approximately 9,300 employees as of June 30, 2019, down from about 10,000 employees on December 31, 2018[40]. - The total employee costs for the review period were HKD 308 million, accounting for 4.2% of the group's revenue, compared to HKD 322 million (5.3%) in the first half of 2018[40]. - The total remuneration for key management personnel was HKD 1,492,000 for the six months ended June 30, 2019, down from HKD 5,626,000 in the same period of 2018[156]. Related Party Transactions - The group reported significant related party transactions, including sales of raw materials to related companies amounting to HKD 1,379,000 and sales of finished products amounting to HKD 2,772,000 for the six months ended June 30, 2019[150]. - The group purchased raw materials from related companies totaling HKD 34,227,000, an increase from HKD 27,343,000 in the same period of 2018[150]. - Trade receivables from related companies increased to HKD 31,806,000 as of June 30, 2019, compared to HKD 7,859,000 as of December 31, 2018[154]. - Trade payables to related companies rose to HKD 213,265,000 as of June 30, 2019, from HKD 196,047,000 as of December 31, 2018[154].

Financial Performance - For the six months ended June 30, 2019, the company reported revenue of HKD 7,392,433 thousand, an increase from HKD 6,115,061 thousand in the same period of 2018, representing a growth of approximately 20.9%[5] - The gross profit for the same period was HKD 516,635 thousand, compared to HKD 420,555 thousand in 2018, indicating a gross margin improvement[5] - The net loss for the period was HKD 446,245 thousand, a decrease from a net loss of HKD 541,380 thousand in the previous year, reflecting a reduction in losses by approximately 19.5%[5] - The company reported a total comprehensive loss of HKD 531,684 thousand for the period, compared to HKD 567,581 thousand in 2018, showing an improvement in comprehensive loss[13] - The company reported a comprehensive loss of HKD (446,245,000) for the six months ended June 30, 2019, compared to a loss of HKD (541,380,000) in the same period of 2018, indicating an improvement of 17.5%[58] - The group recorded a net loss of HKD 448 million for the review period, an improvement from a net loss of HKD 542 million in the first half of 2018[107] Cash Flow and Liquidity - The company reported cash generated from operating activities of HKD 6,360 thousand, a significant decrease from HKD 129,422 thousand in 2018[20] - The company's cash and cash equivalents decreased to HKD 201,885 thousand from HKD 147,007 thousand in the previous year, reflecting a net decrease of HKD 14,902 thousand[20] - The group’s cash and cash equivalents amounted to HKD 201,885,000 as of June 30, 2019, down from HKD 218,687,000 as of December 31, 2018[23] - The board has taken measures to alleviate liquidity pressure, including negotiating with banks for waivers and seeking additional financing[24] - The board believes the group has sufficient financial resources to support operations and meet financial obligations due within the next twelve months[26] Assets and Liabilities - The total assets as of June 30, 2019, were HKD 10,327,586 thousand, down from HKD 10,886,706 thousand at the end of 2018[18] - The company’s total liabilities as of June 30, 2019, were HKD 10,182,511 thousand, compared to HKD 10,053,658 thousand at the end of 2018, indicating an increase in liabilities[18] - The company’s net asset value decreased to HKD 2,293,139 thousand from HKD 2,824,823 thousand at the end of 2018, reflecting a decline in equity[18] - The group's total assets decreased to HKD 131.44 billion from HKD 136.76 billion at the end of 2018, a reduction of HKD 5.32 billion[104] - The total debt to total capital ratio increased to 75.8%, up from 72.1% as of December 31, 2018, representing a 3.7 percentage point increase[108] - The group's equity attributable to shareholders decreased to HKD 2.241 billion, down HKD 533 million from HKD 2.774 billion as of December 31, 2018[107] Segment Performance - Total revenue for the six months ended June 30, 2019, was HKD 7,521,608,000, an increase of 20.4% compared to HKD 6,250,632,000 for the same period in 2018[55] - The reported segment loss for the six months ended June 30, 2019, was HKD (111,223,000), a significant improvement from HKD (305,157,000) in the same period of 2018[55] - The sales revenue of fresh meat was HKD 54.50 billion, representing a 20.4% increase from HKD 45.26 billion in the previous year, accounting for approximately 72% of total revenue[85] - The sales of deep-processed meat products amounted to HKD 10.89 billion, a decrease of 8.8% from HKD 11.94 billion in the previous year[91] Expenses and Costs - Depreciation and amortization expenses for the six months ended June 30, 2019, were HKD (157,012,000), down from HKD (217,005,000) in 2018, reflecting a reduction of 27.7%[55] - Operating expenses decreased by 10.7% to HKD 585 million from HKD 655 million in the same period last year, with operating expenses accounting for 7.9% of the group's revenue, down 2.8 percentage points year-on-year[95] - Financial expenses increased to HKD 321 million from HKD 212 million in the same period last year, primarily due to higher bank interest[97] - Employee costs totaled HKD 308 million, accounting for 4.2% of the group's revenue, down from HKD 322 million and 5.3% in the first half of 2018[116] Compliance and Governance - The company has adopted the standards set forth in the Listing Rules Appendix 10 regarding the conduct of securities transactions by directors, confirming compliance during the review period[122] - The audit committee reviewed the accounting standards and practices adopted by the group, including the unaudited interim performance for the review period[124] - There were no significant matters affecting the group from June 30, 2019, to the date of this announcement[125] Market and Economic Context - In the first half of 2019, China's GDP was RMB 45,093.3 billion, growing by 6.3% year-on-year[80] - The average purchasing price of live pigs increased by 13.4% compared to the same period last year, with a total slaughter volume of approximately 3.78 million heads, up by 16.9% year-on-year[89] - The average disposable income per capita in China was RMB 15,294, with a real growth of 6.5%, outpacing GDP growth by 0.2 percentage points[80] - The total retail sales of consumer goods reached RMB 19.5 trillion, growing by 8.4% year-on-year, with final consumption expenditure contributing 60.1% to economic growth[80] Legal and Litigation Matters - The group failed to meet certain bank loan covenants totaling HKD 5,004,099,000 as of June 30, 2019, which included ongoing litigation amounting to HKD 2,133,475,000[23] - As of June 30, 2019, certain properties with a book value of HKD 452,280,000 were frozen by Chinese courts due to litigation related to bank loans[62] - The group has ongoing litigation with local governments claiming approximately HKD 91,488,000 in cash, down from HKD 130,578,000 as of December 31, 2018[77] - The group has recognized a provision for litigation losses of HKD 91,488,000 in the income statement for the six months ended June 30, 2019[77] Strategic Focus - The company is focusing on high-quality product development and has a research team of over 300 professionals to enhance brand value and expand business advantages[84] - The group is committed to environmental protection and aims to reduce waste generation in its production processes[117] - The group has no significant investments or plans for major acquisitions or capital asset purchases during the review period[111]

China Yurun Food Group Limited 中 國 雨 潤 食 品 集 團 有 限 公 司 (於百慕建柱冊成立之有限公司) 股份代號：1068 milling month 目錄 | --- | --- | |--------------------------|--------------------| | 057 I | 002 | | 綜合損益及其他全面收益表 | 公司資料 | | 058 I | 003 | | 綜合財務狀況表 | 主席報告書 | | 060 I | 007 | | 綜合權益變動表 | 管理層之論述及分析 | | 061 I 綜合現金流量表 | 019 董事簡歷 | | 063 I | 020 | | 綜合財務報表附註 | 企業管治報告書 | | 132 I | 037 | | 主要附屬公司名單 | 董事會報告書 | | 134 I | 053 | | 五年概要 | 獨立核數師報告 | | | 056 | | | 綜合損益表 | 公司資料 董事會 執行董事 祝 媛（主席及首席執行官，委任於二零一九年 三月二十八日生效） 俞章禮（呈辭於二零一九年三月二十八日生效） 李世保 ...