Core Viewpoint - Guangdong Province is focusing on enhancing the quality and competitiveness of its livestock industry through a "media+" initiative, aiming to address challenges such as market structure adjustments and consumer demand shifts while leveraging media for brand building and market expansion [1][4][6]. Industry Overview - In 2024, Guangdong's total meat production is projected to reach 5.124 million tons, with a livestock industry output value of approximately 173.58 billion yuan, ranking among the top in China [1]. - The livestock sector in Guangdong is characterized by a large scale, complete supply chain, and distinct features, with significant advantages in smart farming and industrial cluster development [1]. Action Plan - The "media+" initiative includes three main projects: brand building and trust, production-sales connection and market expansion, and technology empowerment and industry upgrading [1][4]. - The plan aims to achieve six goals within three years: brand elevation, production-sales efficiency, market confidence, technology empowerment, talent revitalization, and integration efficiency [4]. Media's Role - Media is seen as a crucial driver for industry transformation, moving from simple advertising to creating cultural symbols for products and guiding consumer behavior [4][6]. - The "12221" marketing system has been successful in aligning production with market demand, and similar strategies are being applied to the livestock sector [3][4]. Consumer Engagement - The initiative aims to enhance consumer understanding of livestock products, emphasizing quality and health, and to create a transparent supply chain [6][9]. - Events and campaigns are being organized to promote local specialties and enhance brand recognition, such as the "Chinese Native Chicken Culture Promotion Center" and various food festivals [8][9]. Future Directions - The integration of media into the livestock industry is expected to facilitate product traceability, promote advanced practices from abroad, and create a comprehensive ecosystem linking production, consumption, and tourism [6][8].

Core Viewpoint - The company reported an increase in production costs for meat chickens due to rising feed raw material costs and prolonged high-temperature weather, but anticipates a reduction in costs as production normalizes [1] Group 1: Chicken Production - The company's complete cost for meat chickens in Q3 rose to approximately 11.4 yuan/kg, but there is expected room for cost reduction with the arrival of seasonal production [1] - The company has established an annual slaughter capacity of 150 million chickens and aims to enhance capacity utilization to lower processing costs while expanding fresh chicken channels [1] - The target slaughter volume for the company's slaughter segment is set at 100 million chickens by 2025 to further achieve cost reduction and efficiency improvements [1] Group 2: Pig Farming - In Q3, the company's pig farming segment showed continuous improvement in production efficiency, with a complete cost of approximately 12.6 yuan/kg, which decreased to 12.3 yuan/kg in September [1] - The company plans to continue quality improvement and cost reduction efforts in Q4, aiming for a cost target of 12 yuan/kg by the end of the year [1]

Core Viewpoint - Lihua Co., Ltd. (300761) announced on October 28 that it has established an annual slaughter capacity of 150 million chickens and aims to enhance capacity utilization to reduce processing costs while expanding its chilled chicken channels and strengthening the "fresh and frozen linkage" strategy [1] Group 1 - The company has built an annual slaughter capacity of 150 million chickens [1] - The target slaughter volume for the slaughter segment in 2025 is set at 100 million chickens [1] - The company is focused on cost reduction and efficiency improvement along with extending the industrial chain [1]

Group 1: Financial Performance Overview - The company achieved a revenue of 13.493 billion CNY for the first nine months of 2025, with 5.140 billion CNY in the third quarter [2] - The net profit attributable to shareholders for the first nine months was 287 million CNY, with 138 million CNY in the third quarter [2] - The company's performance showed fluctuations due to a year-on-year decline in product prices despite stable operations in its yellow feathered chicken and pig farming segments [2] Group 2: Cost Management and Market Outlook - The complete cost of yellow feathered chicken in the third quarter rose to approximately 11.4 CNY/kg due to increased feed raw material costs and prolonged high-temperature weather [3] - The yellow feathered chicken market began to recover from a low point in June and July, with profitability maintained since August [3] - The pig farming segment's production cost was around 12.6 CNY/kg in the third quarter, decreasing to 12.3 CNY/kg in September, with a target of 12 CNY/kg by year-end [3] Group 3: Production Capacity and Strategic Goals - The company has established an annual slaughter capacity of 150 million yellow feathered chickens, aiming for a slaughter target of 100 million chickens in 2025 [3] - Efforts are being made to enhance production efficiency and reduce processing costs while expanding the fresh chicken market [3]

Summary of the Conference Call for Lihua Co., Ltd. Industry Overview - The conference call primarily discusses the performance of Lihua Co., Ltd. in the poultry and pork sectors, particularly focusing on the yellow feather chicken and pork production segments. Key Points and Arguments Financial Performance - In Q3 2025, Lihua Co., Ltd. achieved a profit of approximately 1.38 billion yuan, with a cumulative profit of 2.87 billion yuan for the first three quarters. However, the overall performance was only marginally profitable due to significant losses in July and June, resulting in a net profit of about 10 to 20 million yuan for the quarter [2][3][14]. - The yellow feather chicken segment experienced a U-shaped recovery, with severe losses in July, returning to breakeven in August, and achieving better profitability in September [3]. Cost and Pricing Dynamics - The production cost for yellow feather chickens increased due to rising feed prices, averaging close to 5.7 yuan per chicken in Q3. It is expected that the feed-to-meat ratio will decline in Q4, but costs are unlikely to return to the lower levels seen in the first half of the year [2][4]. - Pork production costs have been decreasing, reaching 12.61 yuan per kilogram in September, with expectations to drop further to around 6.6 yuan per kilogram by December [2][4]. Asset Impairment - The company recorded a total impairment of approximately 40 million yuan in Q3, with two-thirds attributed to leasing assets and the remainder related to yellow feather chicken and goose assets [2][5]. Production Capacity and Sales Strategy - The company has an ice-fresh chicken production capacity of 150 million chickens, with a sales target of 100 million chickens for the year. Plans to enhance product quality, expand brand market presence, and improve processing and packaging are in place to increase profit margins [2][6]. - The company aims to reduce the complete cost of live pigs to around 12 yuan per kilogram by improving production metrics such as farrowing rates and PSY (Pigs Sold per Year) [2][7]. Market Outlook - The outlook for Q4 2025 and H1 2026 indicates that while pork prices are expected to remain stable, the supply of chicken may be affected if pork prices do not rise significantly. The likelihood of a repeat of the severe price drops experienced in the previous summer is considered low [4]. Government Subsidies and Farmer Engagement - Increased government subsidies are anticipated in 2025, potentially disbursed earlier than usual. The fee for farmers raising chickens is currently between 3.2 to 3.3 yuan per chicken, with a growth rate of about 8% to 10% in the number of farmers compared to the previous year [2][15]. Market Dynamics - The low prices of yellow feather chickens in June and July led to some small and medium-sized farms exiting the market. However, the overall growth in larger enterprises has mitigated the impact of these exits [2][16]. Additional Important Information - The company has been cautious in its financial assessments, leading to impairment provisions even when certain products show profitability. This reflects a conservative approach to managing financial risks [9][10]. - The slaughtering segment reported a profit of around 2 to 3 million yuan in Q3, with a slaughter volume of approximately 25 million chickens [12]. This summary encapsulates the critical insights from the conference call, highlighting the financial performance, cost dynamics, production strategies, and market outlook for Lihua Co., Ltd.

Group 1: Future Development Directions - Guanghong Holdings aims to establish an integrated food industry sector encompassing "seed research and development + food processing + smart cold chain" [2] - The 2025 poultry business development goals focus on "stabilizing market conditions, optimizing product structure, and extending the industrial chain" [3] Group 2: Business Expansion and Product Development - The company plans to enter the poultry slaughtering sector and expand sales of fresh chicken, targeting large institutional clients and retail channels [3] - The 2025 target for live pig output is set between 800,000 to 1,000,000 heads, achieved through leasing, cooperation, and acquisitions [6] Group 3: Financial Performance and Dividend Policy - The 2024 profit distribution plan proposes a cash dividend of 1.20 CNY per 10 shares, totaling 70.05 million CNY, with a payout ratio of 57.53%, an increase of 16.39 percentage points from the previous year [6] - The cumulative cash dividends over the last three years amount to 245 million CNY, representing 58.78% of the average net profit during the same period [6] Group 4: Technological Innovations and Safety Measures - The company has upgraded its biosecurity measures, reducing disease testing time from 2-3 days to 1 day and adding 10 new food safety testing items [3] - The "Provincial Cold Chain" smart management system enhances logistics efficiency and customer satisfaction through data analysis and service improvements [4] Group 5: Market Position and Competitive Advantages - Guanghong Holdings has established itself as a leader in poultry breeding in South China, with a focus on technological innovation and partnerships with educational institutions [10] - The company has achieved a 100% repurchase rate for the Huangma No. 4 rooster, showcasing its success in new breed promotion [7]