NEW HOPE(SZ:000876)2021-04-29 16:00Financial Performance - The company's operating revenue for 2020 was ¥109.83 billion, an increase of 33.85% compared to ¥82.05 billion in 2019[42]. - The net profit attributable to shareholders for 2020 was ¥4.94 billion, a decrease of 1.94% from ¥5.04 billion in 2019[42]. - The net profit after deducting non-recurring gains and losses was ¥5.47 billion, up 3.80% from ¥5.27 billion in 2019[42]. - The net cash flow from operating activities increased by 27.53% to ¥5.66 billion in 2020, compared to ¥4.44 billion in 2019[42]. - The total assets at the end of 2020 were ¥109.44 billion, a 70.43% increase from ¥64.22 billion at the end of 2019[44]. - The net assets attributable to shareholders increased by 52.89% to ¥39.85 billion at the end of 2020, compared to ¥26.06 billion at the end of 2019[44]. - The weighted average return on equity for 2020 was 16.09%, down 4.54 percentage points from 20.63% in 2019[44]. - The company reported a quarterly revenue of ¥35.04 billion in Q4 2020, marking a significant increase from previous quarters[47]. - The non-recurring losses for 2020 totaled ¥528.47 million, compared to losses of ¥230.13 million in 2019[49]. - The company achieved a gross profit of ¥3.727 billion from feed sales, an increase of ¥0.290 billion, or 8.43% year-on-year[109]. Market Dynamics - The company faced significant challenges in 2020 due to the COVID-19 pandemic, which led to delayed operations and reduced livestock production capacity[7]. - The resurgence of African swine fever has continued to impact the livestock industry, affecting production and market dynamics[6]. - In 2020, the company faced price fluctuations in livestock, with pig prices initially dropping due to weak consumption but later rebounding, while poultry prices remained under pressure due to oversupply and reduced demand caused by COVID-19[16]. - The company anticipates that the recovery of national pig production capacity will lead to a decrease in pig prices, while the poultry market will continue to face supply-demand imbalances[16]. - The company has reported that environmental regulations are forcing non-compliant farms to exit the market, which may benefit remaining producers by improving profitability in the long run[19]. Operational Strategies - The company has implemented strict biosecurity measures and established a comprehensive disease prevention system, achieving industry-leading survival and market rates for pigs[10]. - The company has developed emergency response plans and maintains sufficient flood prevention materials to mitigate the impact of natural disasters on operations[12]. - The company has adapted its production strategies in response to natural disasters, leveraging its nationwide presence to minimize operational disruptions[12]. - The company has focused on enhancing product quality and market development to counteract the effects of various epidemics and price fluctuations[10]. - The company has been focusing on improving breeding efficiency, maintaining industry-leading levels in key metrics such as PSY (Pigs per Sow per Year) and total cost, ensuring competitiveness during price downturns[17]. Talent and Workforce - The company has expanded its pig farming workforce to 50,000 people and plans to continue this expansion, which poses challenges in talent recruitment and retention[28]. - The company has focused on enhancing its talent development strategy, including recruiting from non-agricultural backgrounds and veterans, to address the shortage of skilled personnel in new business areas[29]. - The company is facing increased competition for talent in the agricultural sector, which may impact its long-term development[28]. Investment and Financing - The company completed the issuance of RMB 4 billion convertible bonds and initiated a new round of RMB 8.15 billion convertible bonds to support development[105]. - The company has a total of 720,000 heads of pigs planned for annual output across multiple projects, with specific projects showing completion rates of 86.60%, 61.54%, and 30.23%[165]. - The company has signed a tripartite supervision agreement with the sponsor and regulatory bank for the management and use of raised funds[161]. - The company is committed to ensuring that the raised funds are used specifically for the designated projects as per regulatory requirements[161]. Research and Development - The company has established a comprehensive feed nutrition and raw material database, with 2,006 patent applications, of which 1,371 have been authorized, showcasing its strong R&D capabilities[83]. - Research and development personnel increased by 42% year-on-year, with R&D investment rising by 53%[105]. - The company launched the "6H no-antibiotic comprehensive solution" in feed research, with biological and environmentally friendly feed sales exceeding 3.5 million tons[139]. - The company is actively involved in over 51 key research projects across various fields, including feed, pig farming, and food safety[139]. Supply Chain Management - The company has utilized hedging tools to manage raw material price volatility during the COVID-19 pandemic, demonstrating effective supply chain management[14]. - The company has been actively optimizing its raw material procurement system since 2017, establishing strategic partnerships with suppliers to mitigate the impact of rising raw material prices[14]. - The company achieved a centralized procurement rate of approximately 52% in 2020, with key raw material direct procurement rates reaching 95%[84]. Environmental and Biosecurity Measures - The company has established a high standard for biosecurity measures in its self-fattening operations, which has proven effective in disease prevention compared to farmer-operated facilities[67]. - The company has implemented a four-tier biosecurity system in its breeding farms to effectively isolate the African swine fever virus[92]. - The company's wastewater treatment process meets agricultural irrigation standards, allowing for a pig carrying capacity of 30 per mu, significantly higher than the industry average of 3 per mu[95]. Product Development and Sales - The company has launched bio-environmental feed and antibiotic-free feed, while also eliminating outdated production capacity[59]. - The company achieved a poultry meat sales volume that accounted for approximately 10% of the national total in 2020, maintaining a leading position in the white feather duck market[89]. - The company sold 20.77 million tons of pork products, a decrease of 2.49 million tons or 10.7% year-on-year, primarily due to a decline in domestic pig inventory[122]. - The sales revenue of the "Beautiful Farmhouse Small Crispy Meat" product exceeded 600 million RMB, achieving over 300% year-on-year growth[190]. Challenges and Future Outlook - The company is navigating a challenging financial landscape while pursuing growth opportunities in the agricultural sector[175]. - Future outlook remains cautious due to the high number of losses reported, which may affect overall profitability in the coming periods[175]. - The company is exploring potential mergers and acquisitions to strengthen its market position, although no specific targets were mentioned[175].