万洲国际(00288) - 2023 - 中期财报

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