Business Operations - The company operates in the production and sale of pork and related meat products in Changde, Hunan Province, China, and has faced significant impacts from COVID-19, leading to a decline in pork consumption and processing capacity [8]. - The main business includes pig farming, slaughtering, and meat sales, with revenue primarily from these activities [51]. - The company is involved in technical consulting services related to design, application, implementation, and installation [51]. Joint Ventures and Partnerships - In November 2022, the company established a joint venture with Hunan Fengrun Agricultural Development Co., Ltd., with a registered capital of RMB 10 million, where the company holds a 60% equity interest [11]. - The joint venture aims to engage in pig slaughtering and related businesses in China, with expectations to obtain slaughtering permits and commence trial operations in the first half of 2023 [11]. - The company is leveraging its partner's resources to assist in obtaining necessary permits for its slaughtering operations, aiming to enhance service quality [11]. - A joint venture was established in November 2022 in Hunan, China, with a registered capital of RMB 10 million, where the company holds a 60% equity stake [26][27]. - A joint venture agreement was established on November 30, 2022, with a registered capital of RMB 10,000,000, where Hunan Huisheng holds a 60% equity interest [101]. Financial Performance - For the year ended December 31, 2022, the company recorded revenue of approximately RMB 72.9 million, a decrease of about 10.3% or RMB 8.4 million compared to RMB 81.3 million in 2021 [15]. - The gross profit for the year was approximately RMB 1.8 million, down from RMB 2.6 million in 2021, primarily due to a significant decline in the pipeline systems product business [15]. - The pork business saw an increase in revenue of approximately RMB 9.3 million or 16.5%, reaching about RMB 65.8 million in 2022 [15]. - Revenue from the pipeline business decreased by approximately RMB 17.7 million or 71.4%, down to about RMB 7.1 million in 2022 [15]. - The company reported a pre-tax loss of RMB 8,957,000 for 2022, compared to a loss of RMB 31,883,000 in 2021, indicating an improvement in financial performance [196]. - The total comprehensive loss for the year was RMB 13,159,000, a reduction from RMB 23,220,000 in the previous year [196]. - The company reported a total annual loss attributable to owners of RMB 5,645,000 for the year ended December 31, 2022, compared to a loss of RMB 31,771,000 in 2021, representing a significant improvement [198]. - The total comprehensive expenses attributable to owners decreased to RMB 9,767,000 in 2022 from RMB 23,128,000 in 2021, indicating a reduction of approximately 57.8% [198]. - The basic and diluted loss per share for the owners was RMB 0.64 in 2022, a notable decrease from RMB 3.61 in the previous year [198]. Operational Strategies - The company has implemented cost control measures and outsourced pig slaughtering to independent facilities to stabilize production costs and maximize profit margins [8]. - The company is focusing on developing its supply chain and improving operational efficiency to enhance profitability and competitiveness amid rising cost pressures [9]. - The company has adopted a cautious approach to resuming its pig farming business to minimize operational risks and costs [8]. - The company plans to focus on restoring its pig farming business and expanding slaughtering capacity to regain market share in the pork supply chain [35]. - The company anticipates a return to traditional consumer behavior in the post-pandemic era, expecting its fresh pork product business to rebound in 2023 [9]. - The company’s management is optimistic about the recovery of the pork market following a downturn in prices that began in early 2022, with signs of a new cycle emerging [8]. Corporate Governance - The company has complied with the corporate governance code, except for certain provisions regarding independent non-executive directors and audit committee composition [108]. - The board currently consists of four members, including one executive director and three independent non-executive directors, meeting the requirement of at least three independent directors [109]. - The company has not appointed a chairman or CEO, with responsibilities currently assumed by board members [113]. - The board is responsible for overseeing financial performance, major investments, and risk management strategies [114]. - Independent non-executive directors provide independent advice on business strategies and performance to protect the interests of the company and its shareholders [115]. - The board meets at least four times a year to review financial performance and significant decisions [116]. - The company emphasizes board diversity, considering factors such as gender, age, cultural background, and professional experience to enhance performance [120]. - The company has established a written guideline for employees regarding securities trading to prevent insider trading [126]. - The company aims to maintain good corporate governance practices through regular reviews and recommendations for policy updates by the Nomination Committee [140]. Risk Management - The company has established a risk management manual to clarify the roles of management, the board, and the audit committee in risk management [151]. - The internal audit team conducts independent assessments of the risk management and internal control systems, reporting findings to the board [150]. - The board confirmed its overall responsibility for the effectiveness of the group's risk management and internal control systems, with no significant issues identified during the annual review [150]. Shareholder Relations - The company will convene a special general meeting within two months upon receiving a valid request from shareholders holding at least 10% of the voting shares [166]. - Shareholders can submit agenda items for meetings with a notice period of at least 21 days for special resolutions and 14 days for ordinary resolutions [169]. - The company maintains open communication with shareholders and investors, regularly reviewing its policies to ensure effective information dissemination [162]. Environmental Sustainability - The company has installed waste treatment facilities at its farms and production bases to promote environmental sustainability [66].
惠生国际(01340) - 2022 - 年度财报