Summary of Conference Call Transcript Company/Industry Involved - The discussion revolves around the cattle farming industry, specifically focusing on the company's cattle herd management and production plans. Core Points and Arguments - The company is planning to increase its cattle herd size by the end of the year, potentially exceeding the current figure of 580,000 heads of cattle [1]. Other Important but Possibly Overlooked Content - The company is in the process of launching new ranches that were planned in the second half of the previous year, indicating ongoing expansion efforts in production capacity [1].

Financial Performance - For the fiscal year ending December 31, 2023, the company reported a revenue of RMB 18,693,896, representing a year-on-year increase of 3.6% from RMB 18,050,761 in 2022[7]. - The gross profit for the same period was RMB 4,469,785, which is a 5.8% increase compared to RMB 4,223,722 in the previous year[7]. - The company experienced a net loss attributable to shareholders of RMB (1,049,980), contrasting with a profit of RMB 414,771 in 2022, indicating a significant change[7]. - The cash EBITDA for the year was RMB 3,851,418, up 7.3% from RMB 3,591,036 in 2022[7]. - The company's revenue increased by 3.6% from RMB 18,051 million in 2022 to RMB 18,694 million in the reporting period[27]. - The raw milk business generated approximately RMB 12.9 billion in revenue, an increase of 18.9% compared to 2022, accounting for 69.0% of the total revenue during the reporting period[28]. - The cost of sales increased by 3.2% from RMB 16,959 million in 2022 to RMB 17,499 million, primarily due to growth in the raw milk business[71]. - Gross profit rose from RMB 4,224 million in 2022 to RMB 4,470 million, with a gross margin improvement from 23.4% to 23.9%[74]. Production and Operations - The raw milk production reached 3,020,182 tons, a substantial increase of 27.1% from 2,377,156 tons in the previous year[7]. - The total number of dairy cows increased to 582,739 heads, marking a 16.7% rise from 499,451 heads in 2022[8]. - The number of breeding cows rose to 284,208, which is a 22.7% increase from 231,709 in the previous year[8]. - The annual milk yield per breeding cow (excluding certain breeds) was 12.0 tons, a year-on-year increase of 5.3%, with the company's premium fresh milk farms achieving a yield of 12.3 tons[17]. - The group added 14 operational farms during the reporting period, expanding its strategic layout in both existing and new farms, including the goat milk sector[40]. - The company has established a new milk goat farm with a planned stock of 50,000 goats, which will be the largest single milk goat farm in China[37]. - The company operates 15 feed production bases and 15 forage production bases, with high-quality alfalfa accounting for approximately 53% of self-produced forage[28]. Technological Development and Innovation - The company aims to enhance technological value and lead the high-quality development of China's dairy industry[2]. - The company is expanding its product offerings in the specialty fresh milk category, including goat milk, which is expected to enrich its product matrix[2]. - The group implemented energy-saving and emission-reduction projects, completing upgrades to 53 farms by replacing coal and biomass boilers with air source heat pumps[40]. - The group utilized its proprietary smart farm management system "Hui Mu Yun" for precise monitoring of cow health, improving operational efficiency and reducing costs[39]. - The company has initiated research projects on low-carbon emission technologies in collaboration with agricultural research institutions, focusing on reducing greenhouse gas emissions in livestock farming[42]. - The company has developed key technologies such as genetic evaluation, sex control, and embryo technology to enhance the breeding of top dairy cattle and ensure national genetic resource security[58]. Sustainability and Corporate Responsibility - The company plans to continue its strategic focus on sustainable development, aiming for carbon peak by 2030 and carbon neutrality by 2050[68]. - The company is actively addressing employment issues for local farmers, enhancing agricultural productivity and income through its industry and technology advantages[68]. - The company has implemented no-till carbon-sequestering sowing technology on approximately 53,000 acres during the reporting period[53]. - The company has established county-level livestock service centers to address industry pain points and promote high-quality development[49]. - The company received the first "Animal Health Carbon Footprint Certification" in China in October 2023[25]. Governance and Management - The board consists of two executive directors, four non-executive directors, and three independent non-executive directors, with significant experience in the dairy industry[147]. - The company emphasizes strict internal control measures to enhance transparency and accountability to shareholders[159]. - The audit committee consists of three members, including two independent non-executive directors, ensuring oversight of financial reporting and internal controls[170]. - The company has a structured approach to board meetings, with all directors having access to necessary information and the ability to seek independent professional advice[169]. - The company has established appropriate insurance arrangements for directors and senior management against legal claims arising from corporate activities[168]. Market and Customer Relations - Revenue from the top five customers was RMB 13,671 million, accounting for 73.1% of total revenue, up from 64.0% in 2022[111]. - Sales to the largest customer, Yili Group, generated RMB 12,447 million, which constituted 96.5% of the total raw milk revenue, compared to 96.6% in 2022[111]. - The company has maintained a stable long-term cooperative relationship with its major customer, Yili Group[111]. - The company has established partnerships with universities to attract quality talent and enhance employee development[102]. Future Outlook and Strategic Initiatives - The company has set a future outlook with a revenue target of 1.5 billion RMB for the next fiscal year, indicating a projected growth of 25%[154]. - A strategic acquisition of a local dairy producer is in progress, which is anticipated to enhance production capacity by 30%[153]. - The company is investing 100 million RMB in technology upgrades to improve supply chain efficiency and product quality[154]. - The management team emphasizes a focus on sustainability, aiming for a 40% reduction in carbon emissions by 2025[155].

Financial Performance - Revenue for the year ended December 31, 2023, was RMB 18,693,896 thousand, representing a 3.6% increase from RMB 18,050,761 thousand in 2022[2] - Gross profit for the same period was RMB 4,469,785 thousand, up 5.8% from RMB 4,223,722 thousand in the previous year[2] - The company reported a net loss attributable to shareholders of RMB 1,049,980 thousand, compared to a profit of RMB 414,771 thousand in 2022[2] - Cash EBITDA for the year was RMB 3,851,418 thousand, reflecting a 7.3% increase from RMB 3,591,036 thousand in 2022[2] - The company reported a pre-tax loss of RMB 1,359,504,000 for the year ended December 31, 2023, indicating financial challenges[26] - The company recognized an impairment loss of RMB 120,966,000 related to goodwill, reflecting adjustments in future cash flow expectations[26] - The company’s financial assets recorded a fair value gain of RMB 160,429,000, contributing positively to the overall financial performance[26] - The company reported a significant increase in sales of raw milk, with revenue from this segment reaching RMB 12,447,239 thousand in 2023, compared to RMB 10,485,086 thousand in 2022, marking a growth of approximately 18.8%[32] - The company’s revenue from feed sales was RMB 5,209,450,000 in 2023, a decrease from RMB 6,576,398,000 in 2022, indicating a decline of approximately 20.83%[23] - The company reported a net loss from the sale of property, plant, and equipment amounting to RMB 18,531 thousand in 2023, compared to a loss of RMB 2,000 thousand in 2022[35] Production and Operations - Raw milk production increased by 27.1% to 3,020,182 tons from 2,377,156 tons in the previous year[2] - The number of dairy cows increased by 16.7% to 582,739 heads, with breeding cows accounting for 48.8% of the total[2] - The average annual yield per breeding cow increased by 5.3% to 12.0 tons, compared to 11.4 tons in 2022[64] - The group added 14 operational farms during the reporting period, expanding its capacity and entering the goat milk sector[69] - The company operates 91 modern farms across 17 provinces in China, with 14 new farms added during the reporting period[67] - The company’s feed solutions generated revenue of approximately RMB 5.79 billion, accounting for 31.0% of total revenue[60] - The company’s breeding business achieved sales of approximately 1,368,707 doses of frozen semen, with sexed embryo sales increasing by 270.0% compared to 2022[62] Financial Position - Total assets less current liabilities amounted to RMB 25,285,148 thousand, an increase from RMB 23,550,033 thousand in 2022[8] - Non-current liabilities increased to RMB 12,186,453 thousand from RMB 8,798,904 thousand in the previous year[8] - The company's equity attributable to shareholders decreased to RMB 13,098,695 thousand from RMB 14,751,129 thousand in 2022[9] - The company's net current liabilities as of December 31, 2023, amounted to RMB 9.5 billion[16] - The carrying amount of the company's biological assets, specifically breeding cows, was RMB 8,385,409,000 as of December 31, 2023, compared to RMB 7,204,357,000 in 2022, reflecting an increase of approximately 15.4%[18] - The carrying amount of the company's property, plant, and equipment was RMB 15,181,413,000 as of December 31, 2023, up from RMB 12,965,610,000 in 2022, indicating a growth of about 16.9%[19] Cash Flow and Investments - Cash generated from operating activities was RMB 4,390 million in the reporting period, up from RMB 2,548 million in 2022[116] - Cash used in investing activities was RMB 4,344 million, significantly lower than RMB 10,784 million in 2022, mainly due to reduced investments in biological assets and financial assets[116] - The company’s cash and cash equivalents increased to RMB 4,488 million at the end of the reporting period, compared to RMB 1,452 million at the end of 2022[115] - The company invested RMB 8,973,616 thousand in non-current assets during the year, reflecting a strategic focus on long-term growth[31] - The company has no major investments or capital asset plans as of December 31, 2023, indicating a focus on existing operations[125] Governance and Compliance - The company is committed to maintaining high standards of corporate governance and has adopted all applicable provisions of the corporate governance code[132] - The audit committee has reviewed the audited consolidated financial statements for the reporting period[132] - The company has established a nomination committee and a remuneration committee in addition to the audit committee[132] - The company has confirmed compliance with the standard code regarding securities trading by all directors during the reporting period[131] Strategic Initiatives - The company is focusing on high-quality development and digital management practices to enhance operational efficiency and expand its business scale[57] - The group launched a digital technology center to enhance digital competitiveness and drive business technology upgrades, aiming to become a leader in global livestock digital development[92] - The company has established partnerships with five major research institutions to enhance domestic grass competitiveness[81] - The company is actively engaged in research and development of new products and technologies to drive future growth[139] Market Conditions - The average price of fresh milk in China dropped to RMB 3.84 per kilogram in 2023, down approximately 7.7% from RMB 4.16 per kilogram in 2022[56] - The overall economic environment has posed challenges to the dairy industry, impacting milk prices and feed costs, but government policies are aimed at enhancing the competitiveness of domestic dairy products[56]

Financial Performance - For the six months ended June 30, 2023, the company's revenue was RMB 9,076.7 million, representing a 4.2% increase compared to RMB 8,707.0 million in the same period of 2022[11]. - The company's gross profit for the same period was RMB 2,093.2 million, showing a slight decrease of 0.2% from RMB 2,096.9 million year-on-year[11]. - The company reported a loss attributable to owners of RMB 992.0 million, compared to a profit of RMB 219.3 million in the previous year, indicating a significant decline in profitability[11]. - The cash EBITDA for the period was RMB 1,805.3 million, down 1.8% from RMB 1,837.6 million in the same period last year[11]. - The company reported a net loss of RMB 1,243,568 thousand for the six months ended June 30, 2023, compared to a profit of RMB 200,121 thousand in the same period of 2022, indicating a significant decline[143]. - The company recorded a pre-tax loss of RMB 1,206 million during the reporting period, compared to a pre-tax profit of RMB 233 million in mid-2022[83]. - The net loss for the reporting period was RMB 1,244 million, primarily due to a decline in gross margin and increased losses from biological assets[85]. Revenue Breakdown - Raw milk business revenue reached approximately RMB 6.16 billion, representing an 18.0% increase compared to mid-2022, accounting for 67.8% of total revenue[20]. - Revenue from raw milk sales reached RMB 6,156,918 thousand, up 17.96% from RMB 5,219,010 thousand in the previous year[161]. - The average price of raw milk decreased by 5.2% to RMB 4.39 per kilogram, down from RMB 4.63[23]. - Revenue from raw milk sales increased to RMB 5,978,328 thousand in 2023, up from RMB 5,028,566 thousand in 2022, representing a growth of 18.9%[173]. - The feed business generated revenue of approximately RMB 2.64 billion, accounting for 29.1% of total revenue[22]. Operational Metrics - The number of dairy cows increased by 20.6% to 539,400 from 447,335, with the number of breeding cows rising by 21.4% to 253,633[11]. - The company operated 85 modern farms with a total dairy cow inventory of nearly 540,000, producing approximately 1.44 million tons of raw milk during the reporting period[20]. - The annual milk yield per cow reached 12.2 tons, a 7.0% increase from mid-2022, with the Inner Mongolia farm achieving 12.8 tons[20]. - The company produced nearly 580,000 tons of concentrated feed during the reporting period, with over 60% of alfalfa grass meeting top quality standards[22]. Investment and Expansion - The company has established 85 farms, 15 feed production bases, and 15 forage production bases, covering 17 provinces and municipalities in China[3]. - The company is expanding into goat milk production, with a new goat farm planned to house 50,000 goats, which will be the largest single goat farm in China[27]. - The company is constructing multiple new farms in key dairy-producing provinces, expected to commence operations in the second half of 2023[27]. - The company has initiated the construction of a new feed production base in Hebei, which will increase total production capacity to 1.82 million tons upon completion[38]. Research and Development - The company has established a leading R&D platform focused on dairy cow nutrition and health, enhancing the quality of raw milk products[31]. - The company developed key technologies such as the "A2 cow genetic identification method" and established a platform for new livestock stem cell technology and gene editing, enhancing its capabilities in dairy production[51]. - The company has a research and development team of nearly 400 people and has obtained 76 core patent technologies as of June 30, 2023, covering various business segments[55]. Financial Position - As of June 30, 2023, the company's total bank borrowings amounted to RMB 25,821.188 million, an increase from RMB 20,559.056 million at the end of 2022[99]. - The net leverage ratio increased to 189.0% as of June 30, 2023, up from 135.0% at the end of 2022, primarily due to increased borrowings for the expansion of dairy farms[101]. - The company's cash and cash equivalents decreased to RMB 1,243.330 million as of June 30, 2023, from RMB 3,013.284 million at the end of 2022[94]. - The total salary expenditure for the reporting period was RMB 775 million, an increase of 12.3% from RMB 690 million in the mid-2022 report[112]. Corporate Governance and Compliance - The company is committed to maintaining high standards of corporate governance and has adopted all applicable code provisions[127]. - The audit committee has reviewed the interim financial statements and discussed accounting policies and internal controls with management[129]. - The company actively promotes investor relations and communication, engaging with institutional investors and financial analysts[137]. Market and Industry Trends - The average price of fresh milk in major producing provinces in China decreased by approximately 5.7% to RMB 3.96 per kilogram compared to RMB 4.20 per kilogram in mid-2022[17]. - The demand for high-quality breeding products remains strong, with imports of frozen bull semen increasing by 8.9% to 6.7171 million doses during the reporting period[17]. - The Chinese government has issued policies to support the dairy farming industry, enhancing barriers to entry and promoting modernization[18].

Financial Performance - Revenue for the six months ended June 30, 2023, was RMB 9,076,655 thousand, representing a 4.2% increase from RMB 8,706,955 thousand in the same period of 2022[2] - Gross profit for the same period was RMB 2,093,170 thousand, slightly down by 0.2% from RMB 2,096,933 thousand year-on-year[2] - The company reported a loss attributable to owners of RMB (992,017) thousand, compared to a profit of RMB 219,326 thousand in the prior year, indicating a significant decline[2] - Cash EBITDA for the period was RMB 1,805,286 thousand, down 1.8% from RMB 1,837,606 thousand in the previous year[2] - The company experienced a significant loss before tax of RMB (1,206,320) thousand for the period, compared to a profit of RMB 233,406 thousand in the same period last year[5] - The basic and diluted loss per share was RMB (0.26) compared to earnings of RMB 0.06 in the previous year[6] - Total revenue for the six months ended June 30, 2023, increased by 10.5% to RMB 9,076,655 thousand from RMB 8,706,955 thousand in the same period of 2022[82] - Revenue from raw milk business grew by 18.0% to RMB 6,156,918 thousand, driven by a 24.4% increase in sales volume to 1,402,485 tons[82] Assets and Liabilities - Non-current assets totaled RMB 32,673,545 thousand as of June 30, 2023, compared to RMB 31,877,107 thousand at the end of 2022[7] - Current assets decreased to RMB 13,075,970 thousand from RMB 11,569,210 thousand at the end of 2022[7] - As of June 30, 2023, the company's net current liabilities amounted to RMB 9,577 million, compared to RMB 8,327 million as of December 31, 2022[11] - Total assets less current liabilities were RMB 23,096,545 thousand, a decrease from RMB 23,550,033 thousand in the previous year[8] - Non-current liabilities, including bank and other borrowings, increased to RMB 7,619,392 thousand from RMB 6,731,381 thousand year-over-year[8] - The company's net asset value decreased to RMB 13,212,037 thousand from RMB 14,751,129 thousand as of December 31, 2022[8] Cash Flow - The company anticipates sufficient cash flow to meet its liabilities for at least the next 12 months, supported by expected cash flows from operations and available bank loan financing of approximately RMB 5.8 billion[11] - Net cash generated from operating activities was RMB 2,666 million during the reporting period, up from RMB 1,862 million in mid-2022[102] - Net cash used in investing activities was RMB 6,694 million, primarily due to payments for biological assets and financial assets[102] - Net cash generated from financing activities was RMB 3,816 million, mainly from new bank and other borrowings[103] - The ending cash and cash equivalents decreased to RMB 1,243 million from RMB 3,013 million in the same period of 2022[101] Operational Metrics - The number of dairy cows increased by 20.6% to 539,400 from 447,335, with the proportion of breeding cows rising to 47.0% from 46.7%[2] - Raw milk production reached 1,437,138 tons, a 24.9% increase from 1,150,873 tons in the same period last year[52] - The average total bacterial count and somatic cell count of raw milk were significantly better than the standards set by China and international benchmarks[77] - The company operates 15 feed production bases and 15 forage production bases, with a total feed production of nearly 580,000 tons during the reporting period[50] Market and Industry Challenges - The company’s management highlighted the ongoing challenges in the dairy farming industry due to declining milk prices and high feed costs, impacting overall profitability[47] - The average price of fresh milk in major producing provinces was RMB 3.96 per kilogram, a decrease of approximately 5.7% compared to RMB 4.20 per kilogram in mid-2022[47] - The average price of raw milk decreased by 5.2% to RMB 4.39 per kilogram[52] Research and Development - The company is focusing on expanding its research and development capabilities in intelligent and digital farming technologies to enhance operational efficiency[47] - The company has established a leading research platform focused on dairy cow nutrition and health, enhancing the quality of its dairy products[58] - The company has developed a methane emission prediction model for dairy cows, aiming to reduce methane emissions by 10% below the average level while maintaining high yield and disease resistance[74] Employee and Management - The total number of full-time employees as of June 30, 2023, was 11,653, with technical staff comprising 21.0% and skilled workers making up 44.9% of the total[110] - Total salary expenses (excluding share-based payment expenses and retirement plan contributions) for the reporting period amounted to RMB 775 million, representing a 12.3% increase from RMB 690 million in the mid-2022 period[112] - The company has established partnerships with universities to attract and retain qualified employees, enhancing its talent supply chain[111] Governance and Compliance - The audit committee has reviewed the interim financial statements and discussed accounting policies and internal controls with senior management and auditors[114] - The company has established a nomination committee and a remuneration committee in addition to the audit committee[115] - The company strictly adhered to the standards set forth in the code of conduct for securities transactions by directors during the reporting period[114] Environmental and Social Responsibility - The company aims to peak carbon emissions by 2030 and achieve carbon neutrality by 2050, actively promoting fossil carbon and biological carbon reduction technologies[80] - The company has initiated 7 photovoltaic farm projects, promoting clean energy and reducing carbon emissions in its operations[57] - The company is actively researching carbon reduction technologies in dairy farming, collaborating with various research institutions to develop comprehensive carbon neutrality strategies[58]

Revenue and Profit Performance - Revenue for 2022 reached RMB 18,050.8 million, a 17.6% increase compared to RMB 15,346.2 million in 2021[8] - Raw milk business revenue grew by 13.8% to RMB 10,853.9 million in 2022, up from RMB 9,537.8 million in 2021[8] - Ruminant animal farming system solutions revenue increased by 23.9% to RMB 7,196.8 million in 2022, compared to RMB 5,808.4 million in 2021[8] - Gross profit decreased by 10.0% to RMB 4,223.7 million in 2022 from RMB 4,694.5 million in 2021[8] - Net profit attributable to owners of the company dropped by 73.4% to RMB 414.8 million in 2022 from RMB 1,558.0 million in 2021[8] - Adjusted net profit attributable to owners of the company decreased by 56.4% to RMB 889.3 million in 2022 from RMB 2,040.4 million in 2021[8] - The company's total revenue for 2022 reached RMB 18,051 million, a 17.6% increase compared to 2021[14] - The company's net profit attributable to owners in 2022 was RMB 415 million, a 73.4% decrease compared to 2021[14] - Revenue for the company reached RMB 18,051 million in 2022, a 17.6% increase compared to RMB 15,346 million in 2021[32] - Raw milk business revenue was approximately RMB 10.85 billion, accounting for 60.1% of total revenue, a 13.8% increase from 2021[33] - Feed business revenue reached RMB 6.58 billion, a 23.4% increase compared to 2021[33] - Revenue increased by 17.6% from RMB 15,346 million in 2021 to RMB 18,051 million in 2022[78] - Raw milk business revenue grew by 13.8% from RMB 9,538 million in 2021 to RMB 10,854 million in 2022, driven by a 19.6% increase in raw milk sales volume from 1,947,226 tons to 2,328,512 tons[79] - Ruminant animal farming system solutions business revenue rose by 23.9% from RMB 5,808 million in 2021 to RMB 7,197 million in 2022[79] - Net profit attributable to owners decreased from RMB 1,558 million in 2021 to RMB 414.8 million in the reporting period[96] - Adjusted net profit attributable to owners was RMB 889.3 million in the reporting period, compared to RMB 2,040.4 million in 2021[96] Operational Performance and Production - The company operates 78 farms, 15 feed production bases, 14 forage production bases, and 3 core breeding bases, with nearly 500,000 dairy cows[2] - Raw milk production reached nearly 2.38 million tons in 2022, with concentrated feed sales exceeding 1.09 million tons[2] - The company produced nearly 14,000 high-yield dairy cow sex-controlled embryos, becoming one of the earliest enterprises in China to achieve large-scale production and commercial application[2] - The annualized milk yield per mature cow (excluding Jersey cows) in 2022 was 11.4 tons, a 4.6% increase from 10.9 tons in 2021[16] - The company's refined feed sales exceeded 1.09 million tons, making it the first enterprise in the industry to surpass the 1 million ton mark in external sales of ruminant refined feed[16] - The company's breeding product sales reached 1.23 million doses (pieces), a 25.8% increase compared to 2021[16] - The company produced nearly 14,000 high-yield dairy cow sex-controlled embryos, becoming one of the earliest enterprises in China to achieve large-scale production and commercial application of such embryos[16] - The company operates 78 dairy farms covering 16 provinces and autonomous regions, with a total of 500,000 dairy cows[12] - The company has 15 feed production bases and 4 forage production bases, serving nearly 1.5 million ruminant animals across 25 provinces and autonomous regions[12] - Raw milk production reached nearly 2.38 million tons, with an annualized yield per mature cow (excluding Jersey cows) of 11.4 tons, a 4.6% increase from 2021[33] - Feed production exceeded 1.37 million tons, a 23.6% increase from 2021[33] - The company operates 78 modernized ranches across 16 provinces in China, with a total of nearly 500,000 dairy cows[33] - The company operates 15 feed production bases and 14 forage production bases in China[33] - High-quality alfalfa grass produced by the company reached over 60% of RFV170 and above, with 30% of alfalfa silage protein indicators reaching 22%, comparable to top U.S. alfalfa levels[33] - The number of cows in stock increased by 20.0% from 416,196 in 2021 to 499,451 in 2022[37] - Raw milk production increased to 2,377,156 tons in 2022, up from 1,989,684 tons in 2021[36] - The annualized milk yield per mature cow (excluding Jersey cows) increased to 11.4 tons in 2022 from 10.9 tons in 2021[36] - The company operates 78 modernized ranches across 16 provinces in China as of December 31, 2022[37] - Seven new ranches were put into operation during the reporting period, including one 10,000-head organic milk ranch[38] - Raw milk production increased by 19.5% from 1,989,684 tons in 2021 to 2,377,156 tons in the reporting period[43] - Annualized milk yield per mature cow (excluding Jersey cows) increased by 4.6% from 10.9 tons in 2021 to 11.4 tons in the reporting period[43] - The newly commissioned 7 farms achieved an annualized milk yield of 12.3 tons per mature cow, with one farm exceeding 13 tons[43] - The acquired Saikexing farms achieved an annualized milk yield of 10.9 tons per mature cow, a 3.8% increase from 2021[44] - The acquired Fonterra China farms achieved an annualized milk yield of 11.5 tons per mature cow, an 11.7% increase from 2021[44] - Concentrated feed sales increased by 19.5% from 914,085 tons in 2021 to 1,092,738 tons in the reporting period, making the company the first in the industry to exceed 1 million tons in external sales[49] - Concentrated feed production increased by 23.6% from 1.111 million tons in 2021 to 1.373 million tons in the reporting period[50] - The company commissioned a new feed production base with a design capacity of 400,000 tons and added a cooperative production agreement with a third-party feed producer in Gansu[50] - The company is constructing a new feed production base in Hebei, which will increase total feed production capacity to 1.89 million tons upon completion[50] - The company has developed and upgraded multiple concentrate feed products under eight feed brands, utilizing core technologies such as amino acid balance technology and precision nutrition assessment technology, in collaboration with Dr. Harkins[52] - The company has established 14 grass production bases nationwide, producing high-quality roughage products like alfalfa hay and corn silage, achieving a significant increase in yield from 1.8 tons/mu in 2021 to 3.5 tons/mu in the reporting period, a 94.4% increase[54][55] - The company's self-produced alfalfa grass quality has reached Grade 1 or above, with over 60% of the alfalfa grass achieving RFV170 or higher, and alfalfa silage protein content reaching 22% or above, comparable to top U.S. alfalfa levels[55] - The company operates 28 offline dairy cow supermarkets and an online platform, "Jumucheng Technology," serving approximately 1.5 million dairy cows across 25 provinces, offering over 1,000 types of dairy farming consumables[57] - The company's breeding product sales increased by 25.8% from 977,988 doses in 2021 to 1,230,050 doses in the reporting period, with nearly 14,000 sex-controlled embryos produced, making it one of the earliest companies in China to commercialize high-yield dairy cow sex-controlled embryos[58] - The company operates three breeding bases in Inner Mongolia, China, and Wisconsin, USA, with a designed capacity of 3,500 cows in the Inner Mongolia base, which is expected to produce over 14 tons of high-yield sex-controlled embryos annually, totaling 50,000 embryos, and 2,000 breeding embryos, cultivating 500 breeding cattle[59] - The company has established a high-quality beef cattle core breeding farm in China, completing company registration, project design, license acquisition, and construction bidding during the reporting period[59] - The company has accelerated the production of world-class core breeding farms, increased investment in US joint venture breeding farms, and established strategic breeding partnerships with global leading seed companies[60] - The company has developed a genetic evaluation system for breeding embryos through genome-wide testing, enhancing breeding efficiency and reducing breeding costs[61] - The company has established a prediction model for methane emissions in dairy cows through the analysis of production performance and infrared spectral data[61] - The company has a technical R&D team of over 400 people, with 75 core patented technologies covering various business segments as of December 31, 2022[63] - The company has developed 7 types of specialty fresh milk and a range of precision feed products, including structural calf feed, rumen-protected soybean meal, premix, heat stress feed, and perinatal feed[63] - The company has constructed China's leading ruminant nutrition database and developed advanced genetic improvement and sex control technologies for cattle[63] - The company has undertaken key projects such as "High-end Dairy Cow Genetic Resource Mining and Efficient Breeding Technology Innovation" and "High-quality Alfalfa New Variety Breeding and Industrialization Demonstration"[63] - The company's subsidiary, Saikexing, was selected as a key support unit for the "National Livestock and Poultry Breeding Industry Array Enterprise" and the "Breeding Enterprise Breeding Capacity Evaluation Reward Project" in Inner Mongolia[63] - The company's near-infrared nutrition database exceeded 1 million calibration samples, enhancing precision nutrition and testing efficiency in the livestock industry[64] - The company achieved a 100% pass rate in quality inspections by national regulatory agencies and was awarded the "2022 Excellent Dairy Processing Enterprise" by the China Dairy Association[64] - The company collaborated with 44 strategic suppliers on 96 strategic synergy projects, optimizing procurement costs and reducing risks[66] - The company implemented digital transformation through platforms like "Hui Mu Yun" and "Ju Mu Cheng Tech," leveraging cloud computing, AI, and IoT for data-driven business management[67] - The company launched a carbon neutrality strategy, aiming for carbon peak by 2030 and carbon neutrality by 2050, with detailed carbon reduction plans and third-party audits[68] - The company integrated sustainable development into its operations, with over 2.5 million acres of land for combined planting and breeding, promoting green practices[68] - The company achieved breakthroughs in cow cloning embryo production efficiency and recipient pregnancy rate[70] - The company aims to double its income and strengthen profitability through technological empowerment and innovation[71] - The company plans to accelerate the development of high-tech and high-value-added business platforms[73] - The company will optimize its digital strategy blueprint and initiate a comprehensive digital transformation[75] - The company will implement a green and sustainable development strategy, reducing fossil energy usage and enhancing resource recycling[77] - The company will focus on talent development, aiming to upgrade from quantity to quality in its workforce[76] - The company will deepen lean management practices to improve efficiency and value realization[74] Costs and Expenses - Sales cost increased by 18.3% from RMB 14,333 million in 2021 to RMB 16,959 million in 2022, driven by growth in raw milk and ruminant farming system solutions businesses[80] - Raw milk sales cost before fair value adjustment rose by 33.2% from RMB 5,585 million in 2021 to RMB 7,442 million in 2022, due to new farms, increased cow numbers, and rising raw material prices[81] - Average feed cost for high-quality and specialty fresh milk increased by 14.3% to RMB 2.48/kg in 2022, driven by higher feed and forage costs[82] - Ruminant farming system solutions sales cost before fair value adjustment increased by 26.0% from RMB 5,066 million in 2021 to RMB 6,385 million in 2022, mainly due to growth in feed and cow supermarket consumables[83] - Gross profit decreased from RMB 4,694 million in 2021 to RMB 4,224 million in 2022, with gross margin dropping from 30.6% to 23.4% due to rising raw material prices and lower raw milk sales prices[85] - Raw milk business gross profit decreased from RMB 3,953 million in 2021 to RMB 3,412 million in 2022, with gross margin falling from 41.4% to 31.4%[87] - Ruminant farming system solutions gross profit increased from RMB 742 million in 2021 to RMB 812 million in 2022, but gross margin declined from 12.8% to 11.3% due to rising raw material costs[87] - Fair value loss on biological assets increased from RMB 407 million in 2021 to RMB 1,617 million in 2022, driven by lower cow valuations and higher feeding costs[88] - Other income increased by 138.8% from RMB 152 million in 2021 to RMB 363 million in 2022, mainly due to higher government subsidies and reward subsidies[89] - Expected credit loss impairment increased by 163.2% from RMB 12 million in 2021 to RMB 33 million in 2022, due to recoverability issues with certain receivables[90] - Sales and distribution expenses increased by 6.0% from RMB 557 million in 2021 to RMB 590 million in the reporting period, mainly due to increased loading and transportation fees and employee salaries[92] - Administrative expenses decreased by 13.6% from RMB 835 million in 2021 to RMB 722 million in the reporting period, reflecting efficient operational management and cost control[92] - Other expenses increased significantly from RMB 3 million in 2021 to RMB 65 million in the reporting period, primarily due to increased R&D investment[92] - Financing costs surged by 49.8% from RMB 732 million in 2021 to RMB 1,097 million in the reporting period, driven by increased interest on convertible notes and bank loans[92] - Pre-tax profit dropped sharply from RMB 2,095 million in 2021 to RMB 475 million in the reporting period, impacted by rising raw material costs and declining milk prices[92][94] Cash Flow and Financial Position - Net cash generated from operating activities increased from RMB 2,266 million in 2021 to RMB 2,547.8 million in the reporting period[98][99] - Net cash used in investing activities rose from RMB 8,697 million in 2021 to RMB 10,783.8 million in the reporting period, mainly due to payments for biological assets and property, plant, and equipment[99] - Net cash generated from financing activities increased from RMB 5,424.3 million in 2021 to RMB 8,051.8 million in the reporting period, driven by new bank borrowings and early redemption of convertible notes[100] - Bank loans increased to RMB 20,559,056 thousand in 2022, up from RMB 9,456,114 thousand in 2021, with unsecured loans rising to RMB 18,838,786 thousand[101] - Net leverage ratio increased to 135.0% in 2022 from 68.6% in 2021, primarily due to increased bank and other borrowings for dairy farm expansions[102] - Capital commitments for property, plant, and equipment, and biological assets rose to RMB 2,998 million in 2022, a 19.6% increase from RMB 2,506 million in 2021[103] - The company's assets, including shares in subsidiaries and restricted bank deposits, were used as collateral for bank and other borrowings, totaling RMB 8 million[104] - The company has no foreign exchange hedging policy but monitors foreign exchange risks and considers hedging when necessary[105] - The company formed a joint venture with Rixin Investment, with a registered capital of RMB 1 billion, to invest in new dairy farms in China[109] - Total employee count was 11,449 as of December 31, 2022, with technical and skilled workers making up 64.1% of the workforce[110] - Total salary expenses (excluding share-based payments and retirement plan contributions) increased by 12.3% to RMB 1,012 million in 2022 from RMB 901 million in 2021[112] - The company's revenue from its top five customers reached RMB 11,544 million, accounting for 64.0% of total revenue, with the largest customer, Yili Group, contributing RMB 10,485 million, representing 96.6% of raw milk revenue[119] - Yili Group, the company's controlling shareholder, remains the largest customer, with revenue from Yili increasing to RMB 10,485 million in 2022 from RMB 8,757 million in 2021[119] - The company's revenue from overlapping parties, who are both customers and suppliers of Yili Group, contributed approximately 1.3% to total revenue during the reporting period[119] - The company's top five suppliers accounted for less than 30% of total procurement during the reporting period[121] - The company maintains a long-term stable cooperative relationship with Yili Group, which is crucial for its success[119] - The company focuses on providing high-quality raw milk and comprehensive ruminant farming solutions to its customers[122] - The company implements strict procurement policies to ensure the quality and reliability of its suppliers[123] - The company has integrated human rights principles into its Supplier Code of Conduct, prohibiting discrimination

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性 或完整性亦不發表任何聲明，並表明概不就因本公告全部或任何部分內容而產生或因依賴該等 內容而引致的任何損失承擔任何責任。 China Youran Dairy Group Limited 中國優然牧業集團有限公司 （於開曼群島註冊成立的有限公司） （股份代號：9858） 截至2022年12月31日止年度之 年度業績公告 | --- | --- | --- | --- | |-------------------------------------------------|----------------------|----------------------|-----------------| | | | | | | 摘要 | | | | | | 截至 12 月 31 | 日止年度 | | | | 2022 年 人民幣千元 | 2021 年 人民幣千元 | 同比變動 (%) | | | | | | | 收入 | 18,050,761 | 15,346,167 | 17.6 | | 其中：原料奶業務收入 | 10,853,91 ...