Core Viewpoint - Guizhou Southern Dairy Co., Ltd. has suspended its listing application review at the Beijing Stock Exchange due to the need for supplementary audit matters in its financial reports, following significant losses in its production biological assets and challenges in profitability across its subsidiaries [1][2][4]. Financial Performance - The company reported a revenue of 18.17 billion yuan and a net profit of 2.09 billion yuan for 2024, showing a revenue growth of only 0.65% year-on-year and a net profit growth of 4.36% [7][8]. - The revenue from low-temperature dairy products and ambient dairy products was 6.15 billion yuan and 11.74 billion yuan, respectively, with slight year-on-year increases of 1.96% and 1.17% [7]. Market and Operational Challenges - The company has faced a decline in the proportion of self-sourced milk, dropping to 48.90% in 2024 due to increased external sourcing in response to falling fresh milk prices [5][6]. - The company’s sales are heavily concentrated in Guizhou province, with approximately 92% of total revenue generated from this region, indicating a risk of market saturation [7][8]. Subsidiary Performance - The three subsidiaries of the company, which are involved in dairy farming, reported losses in 2024, attributed to a surplus in the fresh milk market and declining prices [4][5]. - The company has been increasing its external milk sourcing to stabilize supply, leading to a significant reduction in the use of self-sourced milk [5][6]. Innovation and R&D - The company has been questioned about its innovation capabilities, with a requirement to demonstrate a minimum R&D expenditure of 3% of revenue or an average of 1 million yuan over the past three years [11][12]. - Despite having advanced production technologies, the company’s R&D expenditure ratio is lower than that of comparable listed companies, raising concerns about its competitive edge [12][13]. Future Strategies - The company plans to expand its market presence through acquisitions, particularly targeting local dairy companies in surrounding provinces [9][10]. - Efforts to diversify sales channels, including e-commerce and community group purchases, are ongoing, but the contribution from outside Guizhou remains low at approximately 4.63% of total revenue [8][10].

Core Viewpoint - Jiangxi Sunshine Dairy Co., Ltd. reported a decrease in revenue but an increase in net profit for the first half of 2025, indicating a resilient performance amidst industry challenges [2][6]. Financial Performance - Revenue for the reporting period was CNY 236.57 million, a decrease of 7.03% compared to CNY 254.47 million in the same period last year [2]. - Net profit attributable to shareholders was CNY 59.82 million, an increase of 8.27% from CNY 55.25 million year-on-year [2]. - The basic earnings per share rose to CNY 0.2116, up 8.24% from CNY 0.1955 [2]. - Total assets at the end of the reporting period were CNY 1.48 billion, a slight decrease of 0.31% from the previous year [2]. Industry Overview - The dairy industry in China is characterized by a competitive landscape with approximately 600 large-scale dairy enterprises, dominated by a few leading companies [3][4]. - Per capita dairy consumption in China is about one-third of the world average, indicating significant growth potential in the market [3][4]. - The industry is experiencing a shift towards higher quality and diversified products, driven by consumer health awareness and demand for premium offerings [4][5]. Business Operations - The company primarily engages in the research, production, and sales of liquid milk and dairy beverages, with low-temperature products being its core offering [7][8]. - The sales model includes both distribution and direct sales, with distribution accounting for 82.27% of total revenue [15]. - The company has established a differentiated product structure focused on low-temperature products and a home delivery service model [8][10]. Competitive Position - Jiangxi Sunshine Dairy has a strong market presence in Jiangxi province and surrounding areas, recognized for its quality and safety standards [10][11]. - The company has received various accolades, including being recognized as a "Chinese Time-Honored Brand" and a member of the International Dairy Federation [11][13]. - The brand is well-regarded in the region, contributing to its competitive advantage in the local market [11][14].