LONGDA(SZ:002726) Huaxin Securities·2024-08-31 10:07Investment Rating - The report maintains a "Buy" rating for Longda Food (002726.SZ) [1] Core Views - Longda Food has turned profitable in H1 2024, with a net profit of 0.58 billion yuan compared to a loss of 6.24 billion yuan in the same period last year. The revenue for H1 2024 was 5.044 billion yuan, a decrease of 25% year-on-year, primarily due to weak terminal demand [1][3] - The company is optimizing its business structure across various segments, focusing on high-margin black pig breeding to meet customer demands and enhance profitability [1][3] - The report highlights a recovery in pig prices, which has positively impacted the breeding segment, leading to improved gross margins and profitability in the frozen products business [1][3] Summary by Sections Financial Performance - H1 2024 revenue was 5.044 billion yuan, down 25% year-on-year, with a net profit of 0.58 billion yuan, a significant recovery from a loss of 6.24 billion yuan in H1 2023 [1] - Q2 2024 revenue was 2.521 billion yuan, a decrease of 22% year-on-year, with a net profit of 0.28 billion yuan [1] - The gross margin for Q2 2024 increased by 11 percentage points to 3.84%, driven by rising pig sales prices and cost reduction measures [1] Business Segments - The slaughtering segment generated 3.901 billion yuan in revenue, down 17% year-on-year, while the food segment saw revenue of 1.082 billion yuan, a slight increase of 0.4% [1][2] - The company plans to enhance its processed food offerings, focusing on high-value products and expanding its customer base in the catering sector [1][3] Earnings Forecast - The report adjusts the earnings per share (EPS) forecast for 2024-2026 to 0.09, 0.17, and 0.24 yuan respectively, with corresponding price-to-earnings (PE) ratios of 72, 39, and 28 times [3][5]