JOYVIO FOOD(SZ:300268)2024-08-28 08:52Financial Performance - As of June 30, 2024, the company's net assets attributable to shareholders were -32,483,452.98 RMB, a decline from positive equity at the end of the previous year[5]. - The company's asset-liability ratio stood at 99.46%, indicating a high level of financial leverage and liquidity risk[5]. - The company reported a net profit (after deducting non-recurring gains and losses) for the 2023 fiscal year as negative, raising concerns about its ongoing viability[4]. - The company plans not to distribute cash dividends, issue bonus shares, or increase capital from reserves[6]. - The company continues to face operational losses, with cash flow remaining tight and liquidity risks increasing[5]. - The company's operating revenue for the first half of 2024 was ¥1,884,578,082.62, a decrease of 26.31% compared to ¥2,557,561,435.79 in the same period last year[20]. - The net profit attributable to shareholders was -¥393,598,582.30, reflecting a decline of 4.71% from -¥375,886,551.52 year-on-year[20]. - The net cash flow from operating activities was -¥109,837,794.12, a significant decrease of 187.14% compared to ¥126,051,721.09 in the previous year[20]. - Total assets at the end of the reporting period were ¥9,606,658,406.30, down 1.62% from ¥9,764,618,932.17 at the end of the previous year[20]. - The net assets attributable to shareholders were -¥32,483,452.98, a decrease of 111.47% from ¥283,109,982.68 at the end of the previous year[20]. - The company's financial report for 2023 was audited by Xinyong Zhonghe Accounting Firm, which highlighted uncertainties regarding the company's ability to continue as a going concern[4]. - The company has not provided specific future performance guidance or forecasts, emphasizing the need for investors to recognize associated risks[3]. Market and Industry Trends - The global aquaculture production reached a historical high of 130.9 million tons in 2022, with a total value of $312.8 billion, marking a significant growth in the seafood market[30]. - The demand for seafood is projected to grow by 15% by 2030, reaching an average per capita consumption of 21.4 kg[30]. - The salmon industry is experiencing a tight supply due to limited wild catch and increasing demand, with future supply expected to remain constrained[33]. - The Chinese seafood market is expected to grow rapidly, with predictions that by 2030, seafood consumption in developing countries will account for 80% of global consumption, with China alone representing 38%[31]. - In the first half of 2024, global Atlantic salmon supply is approximately 1.22 million tons (WFE), a year-on-year decrease of 3%[34]. - Norway's Atlantic salmon supply in the first half of 2024 is about 610,000 tons (WFE), also down 3% year-on-year, while Chile's supply is approximately 320,000 tons (WFE), down 14% year-on-year[34]. - Global salmon consumption in the first half of 2024 is around 1.24 million tons (WFE), remaining relatively stable compared to the previous year[37]. - European salmon consumption increased by 2.2% year-on-year to approximately 527,000 tons, while U.S. consumption decreased by 3.2% to about 304,000 tons[37]. - Salmon sales value grew by 122% from 2013 to 2023, with a compound annual growth rate (CAGR) of 8%, indicating strong market demand potential[35]. Operational Challenges - The company is subject to ongoing regulatory scrutiny due to its financial performance and compliance with the Shenzhen Stock Exchange's disclosure requirements[4]. - The management has outlined potential risks and corresponding mitigation strategies in the report, which investors are encouraged to review[5]. - Feed costs remain high due to rising prices of raw materials like grains and oils, with expectations of a decrease in feed prices in 2024 due to increased fishmeal supply from Peru[38]. - The overall operational costs remain high due to inflation and increased fixed operating expenses from reduced production volumes[59]. - The company is focusing on improving operational efficiency and reducing costs while maintaining business stability and sustainable profitability[158]. Supply Chain and Production - The company has established stable relationships with upstream suppliers and downstream customers, ensuring a reliable supply chain[46]. - The company is actively monitoring the catch conditions and market trends of cod in Russia and the U.S. to optimize its procurement strategies[45]. - The company maintains a market-oriented production model for Arctic sweet shrimp and other products, importing raw materials from various international suppliers[56]. - The company has established a robust procurement strategy that adapts to market changes and ensures a steady supply of raw materials[56]. - The production model for salmon involves long-term agreements with breeding companies to ensure high-quality fry, followed by modern deep-sea farming techniques[55]. Environmental and Social Responsibility - The carbon footprint of farmed salmon is significantly lower than that of other protein sources, with only 5.1 kg of CO2 equivalent produced per kg of salmon, compared to 39.0 kg for beef[77]. - The company has effectively managed risks related to natural disasters and marine predators, ensuring stable production and supply[78]. - The company invests in disease prevention and control measures to maintain the quality and quantity of salmon harvests, addressing common diseases like sea lice and infectious salmon anemia[78]. - Food safety is a top priority for the company, which has implemented a comprehensive food safety assurance system from raw materials to finished products[79]. - The company emphasizes food safety and quality as its core commitment to consumers, ensuring strict inspection standards[149]. - The aquaculture industry contributes directly to 10 of the 17 Sustainable Development Goals (SDGs) proposed by the United Nations[150]. - Australis is the first global salmon producer to use biodegradable packaging, which degrades within 6 to 20 months and is FDA certified for direct food contact[151]. - The company has initiated an "Animal Friendly" campaign, providing free pet food scraps to consumers and donating to animal rescue stations[152]. Legal and Compliance Issues - The company is currently involved in 11 lawsuits as a plaintiff with a total amount of RMB 5.13 million and 27 lawsuits as a defendant with a total amount of RMB 22.18 million, all of which are still pending[171]. - The company has initiated international commercial arbitration against former shareholders of Australis for alleged breaches of the share purchase agreement, claiming damages of approximately 656.34 million yuan[161]. - A civil lawsuit has been filed in the UK seeking damages exceeding £10 million against the former management of Australis for their fraudulent actions during the acquisition[165]. - A criminal lawsuit has been filed against five former directors of Australis for "improper management," with evidence suggesting collusion to cover up fraudulent activities prior to the acquisition[167]. - The company has initiated a civil lawsuit in Delaware to recover assets transferred fraudulently by the former management of Australis, seeking the return of properties valued at approximately $9.14 million and $8.46 million[169]. Financial Strategies and Future Outlook - The company plans to adjust its operational strategy to improve cost efficiency and enhance its capital structure to mitigate risks[121]. - The company plans to raise funds through various means, including strategic investors, syndicate refinancing, asset disposal, and related party loans, to enhance its risk resistance and support daily operational expenses in the coming year[124]. - In case of insufficient funds for daily operations or inability to repay short-term debts, the controlling shareholder and actual controller have committed to providing financial support[125]. - The company is actively negotiating with banks to extend loans and reduce financial costs[158]. - The company has accepted a guarantee from its controlling shareholder, Joyvio Group, for up to RMB 4.8 billion for credit financing in 2023[182].