(A joint stock company incorporated in the People's Republic of China with limited liability) （於中華人民共和國註冊成立的股份有限公司） 股份代號 Stock Code : 9977 2024 年報 ANNUAL REPORT Shandong Fengxiang Co., Ltd. 山東鳳祥股份有限公司 ANNUAL REPORT 年報 2024 02 CORPORATE INFORMATION 公司基本情況 06 MAJOR FINANCIAL INDICATORS AND KEY OPERATING DATA 主要財務指標及主要經營數據 08 2024 MAJOR EVENTS 二零二四年大事記 12 CHAIRMAN'S STATEMENT 董事會主席報告書 15 MANAGEMENT DISCUSSION AND ANALYSIS 管理層討論及分析 35 BIOGRAPHIES OF DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT 董事、監事及高級管理層履歷 46 ...

智通财经4月14日电，受私有化计划影响，凤祥股份股价在香港大涨25%。 ...

Core Insights - The company reported a revenue of 5.505 billion yuan for the year ending December 31, 2024, representing a year-on-year increase of 7.21% [1] - Net profit attributable to shareholders reached 281 million yuan, a significant increase of 75.19% year-on-year, with basic earnings per share at 0.179 yuan [1] Group 1: Revenue and Profit Growth - Export sales revenue increased to 1.676 billion yuan in 2024 from 1.396 billion yuan in 2023, marking a year-on-year growth of 20.1% and accounting for 30.5% of total revenue [1] - The collective procurement business achieved sales revenue of 1.351 billion yuan, up from 1.136 billion yuan in 2023, reflecting an 18.9% year-on-year increase and a business share of 24.6% [1] Group 2: Strategic Initiatives and Operational Improvements - The company emphasized integrated value chain business models and multi-channel layout advantages to strengthen its leading position in the export market [1] - Continuous efforts in cost reduction and efficiency enhancement have led to significant improvements in overall operational management [1] - The company has focused on enhancing its research and development investments and optimizing resource allocation, resulting in rapid growth in new product sales [2] Group 3: Product and Market Development - The proportion of revenue from deep-processed products increased to 53.7% of total revenue, indicating a strengthened ability to withstand market fluctuations [2] - The company has implemented a comprehensive cost control system in the food processing segment, improving cost management effectiveness [2]

Financial Performance - Total revenue for the year ended December 31, 2024, was RMB 5,504,651,000, an increase of 7.2% from RMB 5,134,413,000 in 2023[3] - Net profit for the year ended December 31, 2024, reached RMB 280,867,000, up 75.1% compared to RMB 160,319,000 in 2023[3] - Adjusted net profit for the year was RMB 198,048,000, reflecting a significant increase from RMB 160,319,000 in the previous year[3] - Basic earnings per share increased to RMB 17.9 from RMB 10.8, representing a growth of 65.7%[3] - Total revenue for the year ended December 31, 2024, was RMB 5,504,651 thousand, an increase of 7.2% from RMB 5,134,413 thousand in 2023[15] - The company reported a net profit attributable to shareholders of RMB 280,867 thousand for 2024, compared to RMB 160,319 thousand in 2023, representing a growth of 75.2%[27] - For the fiscal year ending December 31, 2024, the company achieved a sales revenue of RMB 5,504.7 million, representing a year-on-year growth of 7.2% compared to RMB 5,134.4 million in 2023[50] - The net profit for the same period was RMB 280.9 million, which is a significant increase of 75.2% from RMB 160.3 million in 2023[50] - Adjusted net profit increased by 23.5% year-over-year, reaching RMB 198.0 million[69] - The gross profit margin improved to 12.0% in 2024, up from 11.5% in 2023, indicating a 4.1% increase[69] Sales and Revenue Breakdown - Sales volume of processed white feather chickens rose by 16.2% to 430 million kg from 370.1 million kg in 2023[2] - The company reported a 15.8% increase in sales volume of fresh chicken products, totaling 279.3 million kg compared to 241.3 million kg in 2023[2] - Sales volume of deep-processed chicken products increased by 18.4% to 152.9 million kg, with revenue rising by 13.1% to RMB 2,955.4 million, accounting for 53.7% of total revenue[45] - Sales volume of fresh chicken products rose by 15.8% to 279.3 million kg, with revenue increasing by 2.6% to RMB 2,343.4 million, representing 42.6% of total revenue[46] - The sales volume of chicks decreased by 68.7% to 10.7 million, with revenue dropping by 55.8% to RMB 27.0 million, contributing only 0.5% to total revenue[47] - Revenue from other products grew by 1.8% to RMB 178.9 million, making up 3.2% of total revenue[49] - Export business sales revenue increased to RMB 1,676.4 million in 2024, a year-on-year growth of 20.1%, accounting for 30.5% of total revenue[52] - Collective procurement business sales revenue reached RMB 1,351.4 million, up 18.9% year-on-year, with a business share of 24.6%[54] - Key customer business sales revenue grew to RMB 1,026.2 million, representing a 20.9% increase compared to RMB 848.8 million in 2023[55] - Retail business sales revenue decreased to RMB 384.6 million, a decline of 10.2%, with a business share of 7.0%[57] Assets and Liabilities - Current assets increased to RMB 1,730,204,000 from RMB 1,519,578,000, indicating a growth of 13.9%[7] - Total liabilities decreased to RMB 1,928,462,000 from RMB 2,025,170,000, a reduction of 4.8%[8] - Total equity attributable to owners of the parent increased to RMB 3,306,440,000 from RMB 3,031,896,000, reflecting a growth of 9.1%[9] - Accounts receivable increased to RMB 348,691 thousand in 2024 from RMB 284,825 thousand in 2023, representing a growth of 22.4%[29] - The aging analysis of accounts receivable shows that amounts within one month increased to RMB 323,472 thousand in 2024 from RMB 239,508 thousand in 2023, a rise of 35.1%[30] - Total inventory rose to RMB 969,066 thousand in 2024 from RMB 947,344 thousand in 2023, an increase of 2.6%[32] - Total accounts payable increased to RMB 399,453 thousand in 2024 from RMB 380,727 thousand in 2023, an increase of 4.9%[40] - The company’s bank loans with collateral increased to RMB 893,991 thousand in 2024 from RMB 761,033 thousand in 2023, a rise of 17.4%[40] - The company's total borrowings decreased by 15.0% to RMB 999.1 million, attributed to the repayment of maturing long-term loans and improved profitability[83] Operational and Strategic Initiatives - The company has implemented extensive processes to manage operational risks related to climate, disease, and other natural factors affecting biological assets[38] - The company aims to enhance operational efficiency and achieve high-quality growth by focusing on refined management practices across all production stages[65] - The company is committed to talent development to enhance organizational vitality and core capabilities, aiming to foster a culture that embraces challenges[66] - The company has implemented a comprehensive "farm-to-table" model to control quality and costs throughout the poultry lifecycle[43] - The company is focusing on enhancing operational management and cost reduction to improve efficiency amid industry pressures[50] - The company plans to deepen channel engagement and increase customer loyalty by collaborating closely with key clients across various industry lines[93] Challenges and Market Conditions - The company faces challenges such as intensified industry competition and low product prices, but opportunities exist in expanding domestic demand and channel diversification[88] - The company has maintained a leading position in the export market, capitalizing on international supply gaps due to avian influenza[50] - The trend of restaurant chain development is expected to accelerate, providing growth opportunities for quality supply chain companies[61] - The overall industry chain companies are expected to benefit from the shift towards high-quality development in the consumer goods sector[59] Corporate Governance and Compliance - The company has complied with all applicable provisions of the Corporate Governance Code during the reporting period[107] - The audit committee has reviewed the company's accounting principles and policies, as well as the audited financial statements for the year ending December 31, 2024[110] - The preliminary announcement of the group's financial position for the year ending December 31, 2024, has been agreed upon by the auditor and is consistent with the audited financial statements[111] - The company has adopted electronic communication arrangements for company communications, with no printed copies provided[112] Future Plans and Developments - The company has initiated preparations for its initial public offering (IPO) of A-shares as of January 29, 2021, and has appointed Huatai United Securities as the pre-listing advisory institution[92] - The company is revising its articles of association to reflect changes in its business scope and comply with the latest amendments to the Company Law of the People's Republic of China, effective July 1, 2024[98] - A new loan framework agreement with Falcon will provide revolving loan financing with an annual limit of $13,591,000 for the year ending December 31, 2024, and $15,000,000 for the year ending December 31, 2025[100]

Financial Performance - Revenue for the six months ended June 30, 2024, was RMB 2,654,039,000, representing an increase of 8.9% from RMB 2,436,545,000 in the same period of 2023[8] - Gross profit decreased to RMB 237,414,000, down 15.9% from RMB 282,227,000 year-on-year[8] - Net profit for the period was RMB 60,094,000, a decline of 26.8% compared to RMB 82,095,000 in the previous year[8] - Basic earnings per share decreased to RMB 0.04 from RMB 0.06, reflecting a 33.3% drop[8] - The Group achieved total sales revenue of RMB 2,654.0 million for the first half of 2024, an increase of 8.9% compared to RMB 2,436.5 million in the same period of 2023[32] - Net profit for the first half of 2024 was RMB 60.1 million, a decrease of 26.8% from RMB 82.1 million in the first half of 2023[32] - Gross profit decreased by 15.9% to RMB 237.4 million, resulting in a gross profit margin of 8.9%, down from 11.6% in the same period last year[64] - Operating costs rose by 12.2% to RMB 2,416.6 million, primarily due to increased processing and sales volume[65] Sales and Market Performance - The number of white-feathered broilers bred increased by 9.5% to 77.7 million birds compared to 85.1 million birds in the same period of 2023[9] - Processed white-feathered broilers saw a 20.8% increase in volume, reaching 159.0 million kg compared to 192.1 million kg in the previous year[9] - For the six months ended June 30, 2024, the sales volume of processed chicken meat products increased by 20.1% to 73.0 million kg, compared to 60.8 million kg for the same period in 2023[21] - Revenue from the sale of processed chicken meat products grew by 15.2% to RMB1,416.6 million, representing 53.4% of the Group's total revenue[21] - The sales volume of raw chicken meat products increased by 23.6% to 131.5 million kg, up from 106.4 million kg in the previous year[22] - Revenue from external sales of raw chicken meat products increased by 6.3% to RMB1,153.1 million, accounting for 43.4% of the Group's total revenue[22] - The sales volume of chicken breeds decreased by 71.7% to 4.0 million birds, with revenue dropping by 73.9% to RMB 9.7 million, constituting 0.4% of total revenue[25] - Revenue from the sale of other products fell by 11.8% to RMB 74.6 million, representing 2.8% of total revenue[26] Strategic Initiatives and Future Outlook - The company is focusing on expanding its market presence and enhancing product offerings through new technology and product development strategies[7] - Future outlook indicates a commitment to improving operational efficiency and exploring potential mergers and acquisitions to drive growth[7] - The company aims to leverage its existing infrastructure to support market expansion initiatives in the coming quarters[7] - Management emphasizes the importance of adapting to market trends and consumer preferences to sustain competitive advantage[7] - The Group's strategic initiatives included enhancing customer loyalty and exploring new channels and customers to drive growth[28] - The Group aims to enhance operational efficiency and achieve sustainable growth by refining management practices across all processes[50] - The focus will be on improving breeding quality, increasing production capacity, and enhancing supply chain management capabilities[49] Research and Development - The Company held a review meeting for a postdoctoral research project focused on drug resistance mechanisms in poultry, enhancing its R&D capabilities[15] - The Company developed a new black garlic flavored chicken nugget, which has been successfully supplied to customers in bulk[16] - R&D expenses decreased by 6.3% to RMB 12.3 million for the six months ended June 30, 2024, compared to RMB 13.1 million for the same period in 2023[72] Corporate Governance and Shareholder Information - The Company has complied with all applicable code provisions of the Corporate Governance Code during the six months ended June 30, 2024[105] - The Company continues to enhance corporate governance to protect shareholder interests and improve corporate value[103] - Major shareholders include Shan Weijian, holding approximately 95.01% of domestic shares and 25.53% of H shares[92] - Falcon Holding GP Limited holds 992,854,500 Domestic Shares, representing approximately 95.01% of the Domestic Shares class and 62.73% of the total share capital of the Company[93] - The Board of Directors consists of nine members, including two executive directors and three independent non-executive directors[94] Employee and Operational Insights - The Group had 6,075 employees as of June 30, 2024, with the majority employed in the PRC, and offers various employee benefits including social insurance and training programs[85] - The Group adjusted its internal management structure to better meet international customer needs amid rising freight costs and tight production capacity[43] - The Group uses futures contracts to hedge against price fluctuations in raw materials such as corn and soybean meal, with insignificant amounts of ineffective hedging recognized during the reporting period[80][83] Financial Management and Costs - Finance costs decreased by 22.3% to RMB 32.4 million for the six months ended June 30, 2024, down from RMB 41.7 million in the same period of 2023, primarily due to improved borrowing structure and lower interest rates[73][76] - Income tax expenses recorded a negative amount of RMB 39.1 million for the six months ended June 30, 2024, compared to RMB 1.6 million for the same period in 2023, mainly due to the recognition of deferred income tax assets[74][77] - Total borrowings amounted to RMB 1,142.0 million as of June 30, 2024, representing a decrease of 2.8% compared to December 31, 2023, attributed to improved profitability[78][81] Share Award Schemes - The 2020 Share Award Scheme (SAS) was approved to recognize contributions from personnel and provide incentives for retention and development[122] - The 2021 Share Award Scheme (SAS) was approved by the Board on December 10, 2021, with amendments made on August 29, 2023, and June 6, 2024[150] - The 2023 Share Award Scheme (SAS) was approved on August 29, 2023, allowing for awarded shares or cash to selected participants[186] - The maximum number of shares that can be awarded to a selected participant under the 2023 SAS is limited to 1% of the issued share capital in any 12-month period[197]

Financial Performance - Revenue for the six months ended June 30, 2024, was RMB 2,654,039 thousand, an increase of 8.9% compared to RMB 2,436,545 thousand in 2023[4] - Net profit for the same period was RMB 60,094 thousand, down 26.8% from RMB 82,095 thousand in 2023[4] - Gross profit for the six months was RMB 237,414 thousand, down from RMB 282,227 thousand in 2023[4] - Basic earnings per share decreased to RMB 0.04 from RMB 0.06 in 2023[11] - The company reported a total comprehensive income of RMB 59,735 thousand for the period, down from RMB 81,969 thousand in 2023[11] - The consolidated net profit attributable to the parent company's ordinary shareholders for the six months ended June 30, 2024, was RMB 60,094,000, a decrease of 26.8% compared to RMB 82,095,000 for the same period in 2023[33] - Basic earnings per share for the six months ended June 30, 2024, was RMB 0.04, down from RMB 0.06 in the same period of 2023, reflecting a decline of 33.3%[33] - Gross profit decreased by 15.9% to RMB 237.4 million, with a gross margin of 8.9%, down from 11.6% in 2023[92] - Net profit fell by 26.8% to RMB 60.1 million, resulting in a net margin of 2.3%, down from 3.4% in the previous year[92] Revenue Breakdown - The revenue from processed chicken products was RMB 1,416,599 thousand, up 15.2% from RMB 1,229,476 thousand in 2023[20] - Revenue from external customers in mainland China was RMB 1,888,286 thousand, an increase of 5.0% from RMB 1,798,740 thousand in 2023[21] - Revenue from the sale of fresh chicken products grew by 6.3% to RMB 1,153.1 million, accounting for 43.4% of the total revenue[67] - The collective procurement business generated revenue of RMB 646.3 million, a 26.4% increase year-on-year, accounting for 24.4% of total revenue[75] - Export business revenue rose by 20.1% to RMB 765.8 million, representing 28.9% of total revenue[77] - Retail business revenue decreased by 12.6% to RMB 202.2 million, accounting for 7.6% of total revenue[80] Sales Volume - Sales volume of processed broiler chickens increased by 20.8% to 192.1 million kg from 159.0 million kg in 2023[2] - The sales volume of fresh chicken products rose by 23.6% to 131.5 million kg compared to 106.4 million kg in 2023[2] - The sales volume of chicks decreased significantly by 71.7% to 4.0 million from 14.2 million in 2023[2] - The company reported a 20.1% increase in sales volume of processed chicken products to 73.0 million kg for the six months ended June 30, 2024, compared to 60.8 million kg for the same period in 2023[66] - For the six months ending June 30, 2024, the sales volume of fresh chicken products increased by 23.6% to 131.5 million kg, compared to 106.4 million kg for the same period in 2023[67] - The sales volume of chicks decreased by 71.7% to 4.0 million, with revenue dropping 73.9% to RMB 9.7 million, representing 0.4% of total revenue[69] Assets and Liabilities - Total assets as of June 30, 2024, were RMB 5,077,452 thousand, slightly up from RMB 5,057,066 thousand at the end of 2023[12] - The company's total liabilities decreased to RMB 1,989,310 thousand as of June 30, 2024, from RMB 2,025,170 thousand at the end of 2023, representing a reduction of 1.8%[20] - The total current liabilities as of June 30, 2024, were RMB 1,455,965 thousand, a slight decrease of 2.4% from RMB 1,492,166 thousand at the end of 2023[20] - The total borrowings as of June 30, 2024, increased to RMB 1,142,039 thousand from RMB 984,045 thousand as of December 31, 2023[57] - The capital debt ratio was 37.0% and the asset-liability ratio was 39.2% as of June 30, 2024, compared to 38.7% and 40.0% respectively as of December 31, 2023[103] Operational Efficiency - The company continues to focus on refined management and efficiency improvements across all segments to enhance operational performance[82] - The company aims to enhance operational efficiency and achieve stable, high-quality growth through refined management practices and market expansion strategies[84] - The focus for the second half of 2024 includes leveraging digital tools for effective tracking and analysis of operational indicators[88] - The company plans to strengthen its channel layout and expand market share by enhancing its comprehensive business capabilities with key customers[88] - Management expenses increased by 17.1% to RMB 62.0 million, attributed to the implementation of incentive mechanisms and rising employee compensation[96] - Sales expenses decreased by 6.8% to RMB 79.0 million, reflecting improved efficiency in new retail business investments[97] - R&D expenses declined by 6.3% to RMB 12.3 million, due to optimization of product development structure and integration of projects[98] Corporate Governance and Compliance - The company has complied with all applicable provisions of the Corporate Governance Code as of June 30, 2024[132] - The audit committee, consisting of independent non-executive directors, reviewed the interim results and confirmed compliance with applicable accounting standards[138] - The company will continue to review and monitor its corporate governance practices to ensure compliance[132] - The company has not entered into any related party transactions requiring disclosure under Chapter 14A of the Listing Rules during the reporting period[131] Future Plans and Developments - The company is in the preparatory stage for its proposed initial public offering of A-shares, having appointed Huatai United Securities as the pre-listing advisory firm[112] - The company aims to ensure compliance with the public float requirements to facilitate the resumption of trading of its H-shares, effective July 31, 2024[120] - The company has taken appropriate measures to restore its public float in a practical manner to expedite the resumption of H-share trading[118] - The company plans to amend its articles of association to reflect changes in its business scope and comply with the latest amendments to the Company Law of the People's Republic of China, effective July 1, 2024[122] - The company proposed amendments to the 2021 and 2023 share incentive plans, including allowing rewards to be granted in new H-shares and/or existing H-shares[125] - A total of 2,955,968 reward shares were newly granted under the 2023 share incentive plan, replacing unvested shares from the 2021 plan, which will partially be satisfied through the issuance of 730,000 new H-shares[127] Market Conditions - The domestic pork price increase trend is expected to create space for a rebound in chicken prices[108]

Financial Performance - Revenue for the year ended December 31, 2023, was RMB 5,134,413,000, representing a slight increase of 0.96% from RMB 5,085,790,000 in 2022[16] - Gross profit for 2023 was RMB 591,464,000, compared to RMB 583,497,000 in 2022, indicating a growth of 1.49%[16] - The net profit attributable to shareholders of the parent company for 2023 was RMB 160,319,000, a significant recovery from a net loss of RMB 768,993,000 in 2022[16] - Adjusted net profit for 2023 was RMB 160,319,000, a substantial increase from RMB 39,242,000 in the previous year[16] - Basic earnings per share improved to 10.8 RMB cents in 2023, compared to a loss of 55.4 RMB cents per share in 2022[16] - The Group achieved a slight increase in total sales revenue to RMB5,134.4 million for the year, compared to RMB5,085.8 million in 2022, and net profit of RMB160.3 million, a significant recovery from a net loss of RMB769.0 million in 2022[85] - The Group recorded a net profit of RMB160.3 million in 2023, a year-on-year increase of 308.5%[140] - Total operating revenue for 2023 was RMB5,134.4 million, reflecting a slight increase of 1.0% compared to 2022[143] Sales and Market Performance - The export business generated sales revenue of RMB 1,396.0 million, marking a year-on-year increase of 2.7%[48] - Major customer business sales revenue grew to RMB 848.8 million, representing a year-on-year increase of 24.1%[48] - Processed chicken meat product sales volume rose by 13.2% to 129.1 million kg, with revenue increasing by 10.2% to RMB 2,613.7 million, accounting for 50.9% of total revenue[72] - The sales volume of raw chicken meat products decreased to 241.3 million kg, down from 251.5 million kg in 2022[20] - The sales volume of chicken breeds rose to 34.2 million birds, up from 32.1 million birds in 2022[20] - The retail business saw a decline in sales revenue to RMB 428.3 million, down 31.6% year-on-year, and its share of total business decreased to 8.3%[99] - Revenue from the external sale of other products grew by 9.4% to RMB175.7 million, representing 3.4% of the Group's total revenue[77] Operational Strategies and Future Outlook - The company plans to continue focusing on market expansion and new product development to drive future growth[14] - The management discussion indicates a positive outlook for the upcoming fiscal year, with strategies aimed at enhancing operational efficiency[14] - The company plans to enhance breeding quality and optimize costs while deepening channel penetration and expanding market share in 2024[58] - Strategic initiatives for 2024 include advancing lean production, improving efficiency, and accelerating talent pool development[58] - The company aims to achieve sustainable, steady, and balanced quality growth by upgrading the chicken meat products industry[118] - The company will continue to improve breeding quality and steadily increase breeding capacity to enhance supply chain management capabilities[120] - The company intends to deepen channel penetration and expand market share, particularly in centralized procurement for the catering industry and convenience stores[132] Cost Management and Efficiency - Operating costs rose by 0.9% to RMB4,542.9 million, primarily due to an 11.4% increase in the rearing volume of white-feathered broilers[159] - Selling expenses decreased significantly by 52.5% to RMB156.3 million, attributed to reduced sales and marketing expenses[161] - Management expenses decreased by 7.3% to RMB100.6 million from RMB108.5 million in 2022, reflecting ongoing efforts in refined management[167] - Sales expenses dropped by 52.5% to RMB156.3 million from RMB329.2 million in 2022, primarily due to reduced promotional spending[168] Risk Management and Compliance - The Group has established a quality control system covering all operational stages to mitigate food safety risks, obtaining certifications such as ISO22000 and HACCP[194] - The Group faces price risk due to significant fluctuations in commodity prices, particularly for corn and soybean meal, which are essential feed ingredients[191] - The Group's safety management system is aligned with PRC food safety laws and industry standards to prevent production safety accidents[198] - The Group has implemented comprehensive disease prevention procedures for breeders and broilers, including a monitoring program for disease and mortality rates[192] - Epidemic risks, including COVID-19 and other health crises, could materially affect business operations, prompting the Group to monitor and implement hygiene measures[196] Product Development and Innovation - The company launched new products including Jiaoma Chicken Nuggets and Gānggāng Chicken, enhancing its product portfolio[25][30] - iShape's core single products experienced significant growth, with low-fat chicken breast meatballs doubling in sales and tender MIX chicken breast meat increasing by 161% year-on-year[105] - iShape expanded its product line into non-chicken protein, launching popular new products such as Alaska Crab Meat Sticks and various chicken jerky products[106] Financing and Capital Structure - Fengxiang secured a syndicated loan of RMB 960 million, optimizing its debt structure by replacing all previous borrowings[50] - Total borrowings decreased by 21.1% to RMB1,175.3 million as of December 31, 2023, compared to the previous year, due to repayment of long-term borrowings and improved profitability[179] - The gearing ratio improved to 38.7% from 57.0% in 2022, and the balance sheet ratio improved to 40.0% from 50.0% in 2022[180]

Financial Performance - Total revenue for the year ended December 31, 2023, was RMB 5,134,413 thousand, a slight increase from RMB 5,085,790 thousand in 2022, representing a growth of approximately 0.96%[5] - Gross profit for 2023 was RMB 591,464 thousand, compared to RMB 583,497 thousand in 2022, indicating a marginal increase of about 1.66%[7] - Net profit for 2023 reached RMB 160,319 thousand, a significant recovery from a net loss of RMB 768,993 thousand in 2022[7] - Basic earnings per share for 2023 was RMB 10.8, a turnaround from a loss of RMB 55.4 per share in 2022[7] - The company’s operating profit for 2023 was RMB 170,035 thousand, a significant improvement from an operating loss of RMB 768,217 thousand in 2022[17] - The company achieved a net profit of RMB 160.3 million for the year ending December 31, 2023, marking a 308.5% increase compared to the previous year, excluding one-time impairment losses from 2022[125] Revenue Breakdown - Revenue from processed chicken products increased to RMB 2,613,650 thousand, up 10.2% from RMB 2,371,087 thousand in 2022[24] - Revenue from deep-processed chicken products grew by 10.2% to RMB 2,613.7 million for the year ended December 31, 2023, up from RMB 2,371.1 million in 2022, accounting for 50.9% of total revenue[98] - Revenue from key customer sales reached RMB 848.8 million, up 24.1% from RMB 684.2 million in 2022[79] - The overall sales revenue from procurement business reached RMB 1,136.2 million, a 22.7% increase from RMB 926.2 million in 2022, with the business accounting for 22.1% of total revenue[108] - Export sales revenue rose to RMB 1,396.0 million, a 2.7% increase from RMB 1,359.3 million in 2022, representing 27.2% of total revenue[75] Cost Management - The company reported a decrease in total liabilities to RMB 2,025,170 thousand as of December 31, 2023, down from RMB 2,616,574 thousand in 2022, reflecting a reduction of approximately 22.6%[4] - The company’s financial costs increased to RMB 102,981 thousand in 2023 from RMB 49,105 thousand in 2022, representing an increase of approximately 109%[17] - The company reduced its selling expenses by 52.5% to RMB 156,268,000, reflecting ongoing efforts in cost management[154] - Operating costs rose by 0.9% to RMB 4,542.9 million, primarily due to an 11.4% increase in the number of white feather broilers raised[134] Research and Development - Research and development expenses for 2023 were RMB 22,708 thousand, down from RMB 31,944 thousand in 2022, showing a decrease of about 29%[17] - R&D expenses decreased by 28.9% to RMB 22.7 million, attributed to the integration of R&D projects and optimization of product structure[135] Market Expansion and Product Development - The company plans to continue expanding its market presence and investing in new product development[51] - The company launched several new products, including Alaska crab meat sticks and shredded chicken breast, expanding into non-chicken protein areas[82] - The company plans to continue enhancing operational efficiency and effectiveness to achieve stable and sustainable high-quality growth in 2024[87] - The company aims to enhance management efficiency and reduce costs through refined management practices[172] Sales and Distribution - The sales volume of chicks increased by 6.8% to 34.2 million units in 2023, with revenue from chick sales growing by 13.8% to RMB 61.0 million, accounting for 1.2% of total revenue[71] - Retail business revenue was RMB 428.3 million, a decrease of 31.6% from RMB 625.9 million in 2022, accounting for 8.3% of total revenue[110] - The revenue from the 2C segment decreased by 31.6%, with its contribution to total revenue dropping to 8.3% from 12.3% in 2022[183] Operational Efficiency - The company successfully upgraded existing production lines, improving capacity utilization and reducing manufacturing costs[78] - The company continues to optimize feed formulas to reduce raw material costs in its procurement and feed production processes[117] - The company plans to leverage digital tools and big data management systems to improve operational efficiency and support refined management practices[120] Debt and Financial Structure - As of December 31, 2023, the company's debt-to-equity ratio is 38.7%, down from 57.0% in 2022, and the debt-to-asset ratio is 40.0%, down from 50.0% in 2022[168] - The total bank borrowings as of December 31, 2023, amount to RMB 1,175.3 million, a decrease of 21.1% compared to RMB 1,489.0 million on December 31, 2022[188] - The company plans to optimize its debt structure to reduce financial costs[193] Strategic Initiatives - The company is in the preparatory stage for its proposed initial public offering of A-shares, having appointed Huatai United Securities as the pre-listing advisory firm[174] - The company has adopted three stock incentive plans, allowing all full-time and part-time employees, including directors, to participate[191] - The company aims to deepen channel engagement and increase customer stickiness to enhance market share among key customers[193]

Financial Performance - For the six months ended June 30, 2023, the Group achieved sales revenue of RMB 2,436.5 million, remaining stable compared to the same period last year[90]. - The Group recorded a net profit of RMB 82.1 million, a significant improvement from a loss in the corresponding period in 2022[90]. - For the six months ended June 30, 2023, revenue was RMB 2,436,545,000, a slight decrease of 0.3% from RMB 2,443,273,000 in the same period of 2022[128]. - Gross profit increased to RMB 282,227,000, up 27% from RMB 222,336,000 year-on-year[128]. - Net profit attributable to shareholders was RMB 82,095,000, compared to a net loss of RMB 70,937,000 in the same period last year[128]. Sales and Market Performance - The sales volume of raw chicken meat products decreased by 12.1% to 106.4 million kg compared to 121.0 million kg in the same period last year[99]. - Revenue from external sales of raw chicken meat products decreased by 9.9% to RMB 1,085.1 million, representing 44.5% of the Group's total revenue[99]. - The sales volume of processed chicken meat products increased by 11.1% to 60.8 million kg, compared to 54.7 million kg for the same period in 2022[145]. - Revenue from the sale of processed chicken meat products grew by 7.7% to RMB 1,229.5 million, representing 50.5% of the Group's total revenue[145]. - The Group became the largest export supplier in the white-feathered chicken industry in China, with its share of national exports increasing year-on-year[102]. Share Award Schemes - Under the 2020 Share Award Scheme, a total of 2,050,000 shares have been granted, representing approximately 0.15% of the total shares issued at the time of adoption[27]. - The maximum number of new H Shares that can be issued under the 2020 Share Award Scheme in any fiscal year is capped at 3% of the total issued H Shares, equating to 10,650,000 shares[43]. - The total number of shares that can be awarded under the 2020 Share Award Scheme, excluding vested and cancelled shares, is 8,600,000 shares, accounting for 0.61% of the total issued share capital[43]. - The Board of Directors granted 2,050,000 shares under the 2020 Share Award Scheme, with 89.8% vested by June 30, 2023[45]. - No H Shares under the 2020 Share Award Scheme were granted during the six months ended June 30, 2023[64]. Corporate Governance and Strategy - The company aims to improve corporate governance transparency to protect shareholder interests and enhance corporate value since the listing of H Shares on the Main Board of the Stock Exchange[18]. - The Group's strategy included upgrading production capacity and promoting a low-cost approach, which improved overall manpower efficiency and processing fees per ton[154]. - The Group plans to optimize raw material allocation and reduce processing costs through energy management in factories[194][197]. - The integration of operations aims to reduce warehousing and distribution costs, maximizing product output value[195][198]. Product Development and Marketing - The company launched new products including Jiaoma Chicken Nuggets in April, which combines Sichuan peppercorns with chicken[119]. - The iShape brand underwent a visual refresh and was recognized as a top brand in the "2023 National Trendy Food Top 100" list in May[136]. - The Group's marketing strategy included reducing discount promotions to enhance brand image and improve cash flow[92]. - New product development and diversification were emphasized to meet customer demands and market trends[154]. Borrowings and Financial Agreements - As of June 30, 2023, the total borrowings of the group amounted to RMB 1,512.0 million, an increase of 1.5% compared to December 31, 2022, primarily due to the use of self-owned funds for breeding transformation projects and increased borrowings from the controlling shareholder to enhance risk resistance[1]. - The borrowings from the controlling shareholder as of June 30, 2023, were secured against inventory valued at RMB 111.2 million[2]. - The company has established a loan framework agreement with Falcon Holding LP, which provides a revolving loan facility with a maximum daily loan balance of USD 13,591,000 for the years ending December 31, 2023, and December 31, 2024[19]. Customer and Export Business - The major customer business under the new centralized procurement achieved revenue of RMB 375.7 million, a 25.8% increase year-on-year, marking a record high since its listing[156]. - The Group recorded significant growth in overseas markets, particularly in Europe, the Middle East, South Korea, and Mongolia, enhancing its market share through targeted marketing strategies[158]. - The Group maintains a strong export business, supplying premium chicken meat products to markets including Japan, Malaysia, and Europe[140]. - The company received high praise from European clients for its achievements in food safety and ESG management systems[118].

Financial Performance - In the first half of 2023, the company's revenue decreased by 0.3% compared to the same period in 2022, while gross profit increased by 26.9%, resulting in a net profit of RMB 82 million, compared to a loss in the previous year[5]. - For the six months ended June 30, 2023, the company reported revenue of RMB 2,436,545 thousand, a slight decrease of 0.3% compared to RMB 2,443,273 thousand for the same period in 2022[40]. - The gross profit increased to RMB 282,227 thousand, up 27% from RMB 222,336 thousand in the previous year[40]. - The net profit for the period was RMB 82,095 thousand, a significant recovery from a net loss of RMB 70,937 thousand in the same period last year[40]. - Basic earnings per share improved to RMB 0.06, compared to a loss of RMB 0.05 per share in the prior year[40]. - The total comprehensive income for the period was RMB 81,969 thousand, a significant increase from a loss of RMB 71,487 thousand in the previous year[1]. - The company reported a net profit attributable to ordinary shareholders of RMB 82,095 thousand for the six months ended June 30, 2023, compared to a net loss of RMB 70,937 thousand in the same period of 2022, indicating a significant turnaround[97]. - Basic earnings per share for the period was RMB 0.06, recovering from a loss of RMB 0.05 in the previous year[97]. Revenue Breakdown - Revenue from the mainland China market reached RMB 1,798,740 thousand, up 4.7% from RMB 1,718,124 thousand in 2022[66]. - Revenue from deep-processed chicken products was RMB 1,229,476 thousand, an increase of 7.7% from RMB 1,141,297 thousand in 2022[89]. - Revenue from the sale of fresh chicken products fell by 9.9% to RMB 1,085.1 million, accounting for 44.5% of the total revenue[140]. - Revenue from the sale of chicks increased by 54.0% to RMB 37.4 million, representing 1.5% of total revenue[141]. - Revenue from other products increased by 15.8% to RMB 84.6 million, accounting for 3.5% of total revenue[141]. - Revenue from key customer business reached RMB 375.7 million, a year-on-year increase of 25.8%[143]. - New procurement business generated revenue of RMB 511.2 million, up 23.1% year-on-year[143]. - New export business revenue decreased by 12.0% to RMB 637.8 million due to international market conditions[143]. Cost Management - Sales expenses decreased by 51.0% to RMB 84.8 million, down from RMB 173.0 million in the same period last year, due to improved efficiency in the new retail business[7]. - The group's operating costs decreased by 3.0% to RMB 2,154 million for the six months ended June 30, 2023, compared to RMB 2,221 million for the same period in 2022, mainly due to improved production efficiency in breeding and processing[191]. - The company aims to accelerate inventory turnover and implement cost-reduction measures to improve operational cash flow[84]. Financial Stability - As of June 30, 2023, the company's cash and cash equivalents amounted to RMB 370,043 thousand, an increase from RMB 332,156 thousand at the end of 2022[56]. - The total liabilities decreased to RMB 2,440,097 thousand from RMB 2,616,359 thousand year-over-year, indicating improved financial stability[57]. - The company's total assets as of June 30, 2023, were RMB 5,138,009 thousand, down from RMB 5,228,334 thousand at the end of 2022[57]. - The company plans to enhance its financial risk management capabilities and optimize its debt structure by reducing short-term liabilities and increasing long-term debt[50]. - The company is actively negotiating with financial institutions to secure new loans at reasonable costs, with some institutions already expressing interest[49]. - The company aims to ensure sufficient operating funds for the next twelve months through various measures, including obtaining new financing[61]. - The total amount of loans from the controlling shareholder as of June 30, 2023, was RMB 322.2 million, with RMB 87.96 million secured and RMB 234.21 million unsecured[112]. - The capital debt ratio was 56.0% as of June 30, 2023, down from 57.0% on December 31, 2022, while the asset liability ratio decreased to 47.5% from 50.0%[196]. Operational Insights - The company has 7,040 employees, with 7,037 based in China and 3 in Japan, and provides continuous education and training programs for skill enhancement[13]. - The company aims to enhance its breeding capacity further, indicating a focus on operational growth[16]. - The company has invested in five new chicken breeding facilities during the reporting period, contributing to future production capacity[101]. - The company is focusing on developing pre-prepared poultry products, which are expected to become a new growth point due to the increasing market demand[176]. - The group operates under a "farm-to-table" model, allowing effective management of the entire process from poultry farming to distribution and sales[138]. - The company is the largest exporter of white feather broilers in China and a leading retailer of chicken products[114]. - The group has maintained a stable supply of raw chicken through its own supply and independent third-party suppliers[116]. Market Conditions - The domestic consumption market is not meeting expectations, and there are risks associated with product price fluctuations[14]. - The global Western fast-food sector is rapidly recovering, with an increasing market share[199]. - The company is leveraging the experience and resources of its alliance group to explore more business and development opportunities[14]. - The company has expanded its market share in the Tmall platform, with a 2.4 percentage point increase in market share compared to the previous year[183]. - The company’s production biological assets are subject to risks from climate change and diseases, and it has implemented extensive measures to mitigate these risks[106]. Governance and Compliance - The company has complied with all applicable corporate governance codes as of June 30, 2023[36]. - The audit committee, consisting of independent non-executive directors, reviewed the interim results and confirmed compliance with applicable accounting standards[37]. - The company has not declared or proposed any dividends for the first half of 2023, consistent with the previous year[73]. - The company’s effective tax rate remains stable at 25% for the first half of 2023, consistent with the previous year[96].