SHUANGHUI(SZ:000895) Guoyuan Securities·2024-08-16 00:30Investment Rating - The report maintains an "Accumulate" rating for the company [1][9]. Core Views - The company continues to innovate and upgrade its product offerings, leading to an increase in profit margins for meat products [2][3]. - Despite a decline in total revenue and net profit in the first half of 2024, the company is expected to recover with a projected net profit of 4.80 billion yuan in 2024, showing a year-on-year decrease of 4.97% [3][8]. - The report highlights the impact of rising pork prices on profitability, with an average wholesale price of pork increasing by over 33% since late May 2024 [3]. Summary by Sections Financial Performance - In H1 2024, the company achieved total revenue of 27.67 billion yuan, a decrease of 9.34% year-on-year, and a net profit of 2.30 billion yuan, down 19.05% [3]. - The total external sales volume of meat products in H1 2024 was 1.51 million tons, a decline of 7.74% year-on-year, with an average price decrease of 1.73% to 18,300 yuan per ton [3]. - The gross profit margin for H1 2024 was 18.29%, an increase of 1.00 percentage points year-on-year, primarily driven by improved margins in packaged meat products [3]. Product and Market Strategy - The company is focusing on product upgrades, launching high-margin new products such as light chicken sausages and energy sausages, which are expected to enhance profit margins [3]. - The company has optimized its distribution network, with a total of 17,305 distributors by the end of H1 2024, a decrease of 2.56% from the beginning of the year [3]. - The company aims to expand its sales network, currently having over 1 million sales points across most provinces, facilitating rapid distribution [3]. Future Outlook - The company forecasts net profits of 4.80 billion yuan, 5.04 billion yuan, and 5.24 billion yuan for 2024, 2025, and 2026, respectively, with expected growth rates of -4.97%, 5.05%, and 3.91% [3][8]. - The report suggests that the recovery in pork prices will positively impact the company's profitability through frozen products [3].