Industry Overview - Low-temperature luncheon meat is made from fresh or frozen meat, processed through various methods, and stored at temperatures between 0℃ and 4℃, which helps retain more nutrients and provides a better texture compared to room-temperature luncheon meat [1][4][9] - The market for low-temperature luncheon meat in China has grown significantly, from 878 million yuan in 2015 to 16.273 billion yuan in 2024, indicating a strong demand for healthier and more nutritious food options [1][9] Consumer Preferences - A survey indicates that 66.1% of consumers prefer low-temperature luncheon meat due to fewer additives, while 60.7% value its safety and health benefits, and 57.0% appreciate its tender texture [3][9] - The frequency of purchasing low-temperature luncheon meat has increased, with 43.6% of surveyed consumers buying it more often than the previous year, particularly among those aged 18-59 [7][9] Market Trends - The market for low-temperature luncheon meat is expected to reach over 21 billion yuan by 2026, driven by consumer preferences for convenience, health, and nutrition [9][17] - The industry is moving towards more standardized practices, with companies focusing on reducing additives and improving product quality to meet consumer demands for healthier options [18][19] Competitive Landscape - The low-temperature luncheon meat market is competitive, with major players like Shuanghui, Wangjiadu, and others increasing their market presence [11][20] - The market concentration is expected to rise, as companies innovate and expand their product offerings to cater to diverse consumer needs, including low-fat and high-protein options [20]

Core Viewpoint - The financial report of Shuanghui Development for the year 2024 shows concerning trends, with a decline in revenue and net profit for the fourth consecutive year, indicating ongoing challenges in the traditional meat product market [2][4][6]. Financial Performance - In 2024, Shuanghui reported total revenue of 59.56 billion yuan, a decrease of 0.55% year-on-year, and a net profit of 4.99 billion yuan, down 1.26% [4][10]. - The revenue from packaged meat products fell sharply by 6.16%, while the fresh pork product segment also experienced a decline, with revenue down 2.06% to 30.34 billion yuan [6][7]. - The total external sales volume of meat products was 3.18 million tons, reflecting a decrease of 1.67% [6]. Market Competition - The traditional packaged meat products, such as ham and luncheon meat, are losing appeal among younger consumers, who prefer fresh and minimally processed meat options [4][6]. - New brands, like Fengwei Pai founded by celebrity Xie Tingfeng, are capturing market share, with reported sales of 1.5 billion yuan and being the top seller for three consecutive years [2][4]. Dividend Policy - Shuanghui continues its high dividend policy, distributing 48.85 billion yuan in cash dividends, which accounts for nearly 98% of its net profit, raising concerns about corporate governance and the interests of minority shareholders [10][11]. - The company's dividend payout has exceeded its net profit for several years, indicating a reliance on cash flow rather than reinvestment for growth [11]. Governance Issues - The financial report marks the first year under the leadership of Wan Hongwei, the second-generation successor, amidst ongoing concerns about family control and governance issues within the company [13]. - The transition of leadership has not alleviated worries regarding the protection of minority shareholders' interests and the long-term strategic direction of the company [13]. Food Safety Concerns - Shuanghui faces ongoing food safety complaints, with a total of 4,640 complaints reported, primarily related to product quality issues such as spoilage and contamination [15][17]. - Previous incidents of food safety violations have damaged consumer trust, necessitating a comprehensive overhaul of production processes and quality management to restore brand reputation [15][17].