Wellhope(SH:603609)2024-03-29 16:00Financial Performance - The company's operating revenue for 2023 reached approximately CNY 35.97 billion, representing a year-on-year increase of 9.63% compared to CNY 32.81 billion in 2022[21]. - The net profit attributable to shareholders of the listed company for 2023 was a loss of approximately CNY 457 million, a decrease of 189.13% from a profit of CNY 512.8 million in 2022[21]. - The net profit attributable to shareholders after deducting non-recurring gains and losses was a loss of approximately CNY 503 million, down 196.95% from a profit of CNY 518.9 million in the previous year[21]. - The cash flow from operating activities for 2023 was approximately CNY 956 million, an increase of 387.17% compared to CNY 196 million in 2022[21]. - Total assets at the end of 2023 were approximately CNY 14.94 billion, a decrease of 3.18% from CNY 15.43 billion at the end of 2022[21]. - The company's net assets attributable to shareholders at the end of 2023 were approximately CNY 6.66 billion, down 7.97% from CNY 7.24 billion at the end of 2022[21]. - The company will not distribute profits or increase capital reserves due to a negative net profit for the year, as per the company's profit distribution plan[5]. - Operating costs rose to CNY 34.54 billion, reflecting a 12.00% year-on-year increase[89]. - The net profit attributable to shareholders was CNY -4.57 billion, a decrease of 189.13% compared to the previous year[88]. - The net profit after deducting non-recurring gains and losses was CNY -5.03 billion, down 196.95% year-on-year[88]. Operational Highlights - The company's feed sales volume reached 4.3052 million tons, a year-on-year increase of 7.88%[31]. - The sales volume of premix feed increased by 23.54% year-on-year, while concentrated feed decreased by 1.41%[31]. - The sales volume of large-scale customers' bulk feed increased by over 30% year-on-year[35]. - The company has implemented a business model transformation focusing on both channel advantages and direct sales to large-scale farms[35]. - The company's white feather broiler business expanded its slaughter capacity to over 1.1 billion birds annually, with a year-on-year increase of 13% in slaughtered white feather broilers to 810 million birds[38]. - The average feed-to-meat ratio improved to 1.55, while the European index rose to 415, indicating enhanced breeding and production efficiency[39]. - The company’s processed food segment achieved a year-on-year growth of 19%, with a total production and sales of 32,000 tons of processed and cooked products[40]. - The company’s pig farming segment reported a total of 1.16 million pigs slaughtered, including 910,000 fattening pigs, 210,000 piglets, and 40,000 breeding pigs[42]. - The company emphasized a strategy of "controlling scale and adjusting structure" in its pig farming business to optimize asset quality and reduce financial leverage[43]. Market and Industry Challenges - The feed industry faced significant challenges in 2023 due to fluctuating raw material prices and low demand, leading to increased competition and reduced profit margins[47]. - The overall market competition is intensifying, with market share gradually concentrating among leading enterprises due to the dual pressures of industry losses and fluctuating raw material prices[49]. - The average price of pork remained low, leading to a supply-demand imbalance, with the overall pork market showing signs of weakness throughout 2023[54]. - The number of breeding sows remained high, with a 3.8% year-on-year increase in pig slaughter volume and a 4.6% increase in pork production[53]. Strategic Initiatives - The company emphasizes the importance of long-term development planning and financial stability in its future strategies[5]. - The company has strengthened operational management and cost reduction efforts in response to market challenges[34]. - The company is working towards becoming the largest quality law system original breeding pig base in Northeast China, enhancing its breeding management and biosecurity measures[44]. - The company has established strategic partnerships with top raw material suppliers to mitigate risks from raw material price fluctuations[133]. - The company is focusing on vertical integration and resource consolidation within the livestock industry to enhance competitive advantages and risk management[121]. Research and Development - The company has accumulated 266 authorized patents, including 74 invention patents, and has received multiple national and provincial awards for technological advancement[82]. - The company has formed a comprehensive R&D team with hundreds of experts, focusing on feed, poultry, and pig industries, enhancing its technological capabilities[79]. - The company's R&D center is one of the few feed enterprises in China certified by CNAS, ensuring high-quality product testing recognized in 60 countries[81]. - The company is actively researching and developing low-cost substitutes for key raw materials to enhance procurement strategies[133]. Environmental Management - The company has implemented a complete self-monitoring plan for key pollutant discharge units to ensure compliance with national environmental standards[141]. - The company has established a monitoring system for wastewater quality, ensuring compliance with national standards[183]. - The company has invested in new technologies to improve wastewater treatment efficiency, aiming to reduce overall emissions[183]. - The company is committed to maintaining a pH level between 6.0 and 8.5 for wastewater discharge[183]. - The company has implemented a gas treatment system for wastewater treatment facilities, ensuring emissions comply with GB 13271-2014 standards for gas boilers[186]. Governance and Compliance - The company has a comprehensive governance structure with clear responsibilities and effective decision-making processes, ensuring compliance and transparency[144]. - The company has not faced any regulatory criticism or penalties for information disclosure violations since its listing in 2014, maintaining a high level of transparency[145]. - The company received an A-level rating for its information disclosure work for the 2022-2023 period, marking the sixth consecutive year of this achievement[145]. - The company has actively revised its articles of association and is preparing for the upcoming election of the board and supervisory committee[145]. Future Outlook - The company aims to achieve a sales volume increase of over 10% in its feed business for 2024[129]. - The target for the white feather broiler business in 2024 is to exceed a slaughter volume of 860 million birds[130]. - The company plans to sell between 1.2 to 1.4 million heads of pigs from its controlled subsidiaries in 2024[132]. - The company is focusing on cash flow management and project management to ensure business quality and growth in its feed business[126].