Core Viewpoint - Longda Food is facing significant operational challenges despite a relatively stable revenue performance, with a notable decline in profitability as indicated by a 39.52% drop in net profit for the first half of 2025 compared to the previous year [2][6]. Financial Performance - The total revenue for Longda Food in the first half of 2025 was 4.975 billion yuan, a slight decrease of 1.38% from 5.044 billion yuan in the same period last year [3][10]. - The net profit attributable to shareholders fell from 58.15 million yuan to 35.17 million yuan, marking a decline of 39.52% [6][7]. - The net profit after deducting non-recurring gains and losses was 32.28 million yuan, down 42.15% year-on-year [7]. - The basic earnings per share decreased from 0.05 yuan to 0.03 yuan, while diluted earnings per share dropped from 0.07 yuan to 0.05 yuan [3][10]. Business Segment Performance - The slaughtering business, which is a key revenue driver, saw a revenue increase of 4.41% to 4.073 billion yuan, but its gross margin was only 3.51%, limiting its profit contribution [5][7]. - The food segment, particularly the prepared food sector, faced significant setbacks, with sales revenue dropping by 19.91% to 866 million yuan, and the prepared dishes revenue decreased by 19.50% to 783 million yuan [5][8]. Cost and Expense Analysis - Financial expenses surged by 48.66% to 61.82 million yuan, primarily due to interest expenses that could not be capitalized [9][10]. - Research and development expenditures increased by 37.36% to 4.31 million yuan as the company aimed to enhance product competitiveness [9][10]. Strategic Adjustments - Longda Food is undergoing structural adjustments, aiming to control pig production to about 400,000 heads in 2025, which would make the breeding output account for approximately 10% of slaughtering volume [12]. - The company plans to focus on product structure adjustments and deepen market penetration to enhance profit margins, rather than solely increasing slaughter volumes [12].

Group 1: Market Trends and Company Positioning - The pre-prepared food sector is expected to grow, with leading companies aiming for a scale of around 5 billion [2] - The average profit margin in the pre-prepared food industry is approximately 7-10%, while the company's current net profit margin is around 4-5% [2] - The company has established partnerships with over 1,000 well-known clients in the B2B sector, leveraging its first-mover advantage [2] Group 2: C-end Channel Developments - The company is focusing on new retail channels, enhancing product potential, and creating popular products through live streaming and short videos [3] - New products like "lightly marinated pig intestines" achieved sales of 10 million yuan within a month and 4.2 million yuan during a live streaming event [3] - The "fresh food record juicy meat sausage" sold over 10,000 units on its first day of online sales, ranking first in its category for two consecutive months [3] Group 3: Meat Products and Production Capacity - The company's meat products are primarily distributed through distributors, supermarkets, and e-commerce channels to the C-end [4] - The projected pig output for 2024 is 382,400 heads, with an expected increase to around 400,000 heads in 2025 [5] - The company plans to enhance sales and product structure while focusing on deep processing to improve profit margins [5] Group 4: Convertible Bonds - The company will actively promote conversion of its convertible bonds based on market conditions as they approach maturity [6]