LFBC(SZ:002513)2022-12-08 01:28Group 1: Company Transformation and Strategy - The company is transitioning from the pesticide industry to the pharmaceutical sector due to the cyclical and seasonal nature of the former, which has weak risk resistance and increasing operational pressures from stricter environmental policies. The pharmaceutical industry is characterized as a light asset sector with better profitability and lower cyclicality [2] - The future strategy involves developing a dual business model focusing on both pesticides and pharmaceuticals [2] Group 2: Ark Pharmaceutical Acquisition Progress - The company has completed the issuance process for the acquisition of Ark Pharmaceutical, pending formal approval from the China Securities Regulatory Commission [2] - Ark Pharmaceutical's main products include Fufang Banmao Capsules, Donepezil Hydrochloride Tablets, and Dan Zhi Xiao Yao Capsules, which are all included in the national medical insurance list [3] Group 3: Financial Performance and Losses - The company reported losses in 2014 primarily due to decreased market demand for its main product, Renzhong, and a decline in production and sales of the multi-bacterial product [3] - In 2015, losses were mainly attributed to the shutdown of Ningxia Bluefeng due to environmental rectification, resulting in an estimated loss of approximately 60 million [3] - The company has shown signs of recovery, with a profit of over 14 million in the first three quarters of 2015 from the Xinyi branch [3] Group 4: Future Outlook for Pesticide Business - In 2016, Ningxia Bluefeng is expected to resume production, stabilizing the supply of multi-bacterial products and related intermediates, which should eliminate losses [4] - The company anticipates a positive outlook for its pesticide business, with sufficient orders for its profitable product, Renzhong [4]