Summary of COFCO Jiajia Kang Conference Call Company Overview - Company: COFCO Jiajia Kang - Industry: Swine Industry Key Points Industry Trends - The swine industry is experiencing a trend of capacity reduction, driven by anti-involution policies, with a potential cyclical turning point expected in the second half of 2026, presenting investment opportunities in the swine sector [2][4] Company Performance - In 2025, COFCO Jiajia Kang demonstrated stable operations, with a year-on-year increase in hog output exceeding 50% from January to November, alongside continuous cost improvements and significant growth in branded fresh products [2][5] - As of November 2025, the company had a cumulative output of 5.465 million hogs, with an average selling price of 13.65 yuan/kg for commercial hogs [2][6] Financial Metrics - The fresh product business achieved cumulative sales of 300,000 tons, with branded revenue accounting for 32.44% of total sales [2][6] - The average cost of production was approximately 13 yuan/kg, with significant regional cost disparities narrowing, and some excellent facilities achieving costs below 11 yuan [2][11][12] Breeding and Production Efficiency - The proportion of high-quality breeding pigs remained stable at over 80%, with production efficiency indicators such as PSY (Pigs Weaned per Sow per Year) reaching close to 29 and MSY (Marketable Pigs per Sow per Year) nearing 27 [2][9] - The company plans to expand its cooperative breeding model, which currently accounts for over 20% of output, while cautiously managing expansion to mitigate disease risks [2][10] Cost Management - The company is implementing cost reduction measures, including optimizing feed formulations and improving production management, with expectations to lower costs by 0.5 to 1 yuan in 2026 [2][14] - The current cost structure shows self-breeding costs around 13 yuan, while cooperative breeding costs are approximately 12 yuan [2][14] Product Development and Market Strategy - The company’s flaxseed pork products saw a cumulative year-on-year growth of 140% from January to November 2025, with plans to maintain a growth rate of at least 50% in 2026 [3][15] - COFCO Jiajia Kang is expanding its fresh product channels by collaborating with major supermarkets and e-commerce platforms, aiming to enhance brand recognition and product diversity [2][16] Future Outlook - The company anticipates entering a favorable profit zone in 2026 due to supply-side capacity reductions and long-term price reversals in the swine market [2][5] - The meat product segment is expected to expand capacity significantly, with a projected total capacity of 52,000 tons by mid-2026 [2][17] Feed Production and Sales - The company has a diversified feed production structure, with pig feed, poultry feed, and ruminant feed each accounting for approximately 30% of total sales [2][18] - Future sales targets aim for steady growth, with new production capacities expected to enhance utilization rates [2][20] Financial Health and Dividend Plans - The company plans to gradually reduce its debt levels over the long term and will consider dividends if profitability remains strong, having already distributed over 1.8 billion yuan since its listing [2][22]
中粮家佳康20251224