[年报]海大集团(002311):2022年年度报告（英文版）
原标题:海大集团:2022年年度报告（英文版） 2022 Annual Report April 2023 Section I. Important Notes, Table of Contents and Definitions The board of directors (the "Board"), the supervisory committee, the directors, the supervisors and the senior management of Guangdong Haid Group Co., Limited (the "Company") hereby warrant the truthfulness, accuracy and completeness of the information presented in this report, guarantee that there are no misrepresentations, misleading statements or material omissions contained in this annual report, and are individually and collectively responsible for the authenticity, accuracy and completeness of the information contained in this report. Mr. Hua Xue, head of the Company, and Mr. Shaolin Yang, head in charge of accounting work and head of the accounting department (Accounting Officer), declare that they warrant the truthfulness, accuracy and completeness of the financial statements in the annual report. All directors were present in person at the Board meeting to consider and approve this annual report. 1. Periodical Fluctuations of Feed Industry due to Abnormal Weather Changes The feed industry is mainly served for the downstream animal industry. The abnormal changes including extreme high or low temperature, storm, typhoons et al during the breeding production, and even large-scale outbreaks of diseases which may lead to fluctuations of the inventory of livestock or aquatic products. For example, the continuous high temperature weather in this year was followed by the rise of water temperature to exceed the appropriate growth temperature of aquatic products, leading to the decrease of dissolved oxygen saturation in the water, and the reduced intake of aquatic animals and passively reduced feeding. Some aquatic products cannot adapt to the rise of temperature or even die, therefore affecting short-term feed demand and there are adverse effects on the production and operation of feed enterprises. Risk control methods include two aspects: (1) The company is currently fully deploying manufacturers and local markets in major areas in Southern China, Central China, Eastern China and Northern China and overseas markets in Southeast Asia. The expansion of regional distribution can effectively decrease the risk of weather anomalies and natural disasters in local areas. (2) Continuously improving the supports to farmers through the joint empowerment of feed, seedlings, and animal healthcare, providing scientific breeding plans and resistance and competitiveness of farmers and reduce the adverse effects of abnormal weather. 2. Risks of company's production and operation due to the outbreak of epidemic diseases With the environmental changes and the development of large-scale breeding, animal epidemic diseases also occur from time to time, for instance, African swine fever had broken out across China since August 2018 and PRRSV-mediated pig diseases, shrimp-relevant EMS epidemic diseases and poultry-relevant “H7N9” diseases occurred cross country in recent years. The scale of animal production shrinks because of the outbreak of animal epidemic diseases, following the reduced demand for feed in the short term. The prevalence of major animal diseases can also easily affect consumers’ purchase intention, and then reduce the demand of end-consumers, leading to the downturn of the aquaculture and feed industry, giving rise to adverse effects on the production and operation of feed enterprises. Risk control methods include two aspects: (1) The feed products cover the feeds of pig, chicken, duck, goose, fish, shrimp and other livestock and aquatic feeds. The variety of products and the well-balanced structure can effectively mitigate the risk of single species disease with strong comprehensive risk-relieve capability. (2) The company has established the strict epidemic prevention and control system in the production of feed products, utilizing the disease prevention and control from the source with technological advantages and professional capabilities. 3. Risk of Drastic Price Fluctuations of Major Ingredient Materials The feed ingredients consist of staple agricultural products including corn and soybeans (soybean meal) et al. In recent years, the domestic and international markets of agricultural product have been closely connected. There were great fluctuations in prices of agricultural products due to the change of the size in the planting area and the harvest amount in these major grain-producing countries, the purchasing and storage and subsidy policies, the import and export policies, the political conflicts between countries, the international trade relations, the fluctuations in logistics capacity and conditions of shipping and the exchange rates, bringing certain impact on the cost of feed and animal industry. With the strengthening of the international trade of agricultural products, the factors affecting the prices of agricultural products have become more complicated, and the price fluctuations therefore increased. Failing to understand the changes in the trade of feed raw materials in time and promptly implement strategic management, the company may face the risk of rising procurement costs. Risk control methods include three aspects: (1) The materials were divided into different categories including centralized purchasing staple category and local procurement of regional varieties category. It not only guarantees the advantages of large-scale raw material procurement, but also makes best use of localization advantages from rapid response in respect of regional procurement. (2) The raw material procurement research system was continuously invested and constructed. The members of team are professional and familiar with raw material information. It can effectively control the procurement risk through real-time tracking, investigating, and judging the market trend in domestic and foreign bulk raw material, and manage the position risk of bulk raw materials through futures hedging, raw materials trade and other tools. (3) The company has strong research and development (R&D) team composed of nearly 2,000 employees with extensive experience in research on animal nutrition and feed formulation. A large amount of fund was invested on research and development each year, focusing on animal nutrition requirements, feed formulation technology, animal farming and genetic improvement, comprehensive investigation on healthy breeding strategies, and other research areas. The formula can be quickly adjusted to guarantee feed nutrient level and control the costs in copying with material price fluctuations based on the profound understanding of animal nutritional requirements and the expertise in making best use of raw materials. 4. Risk of Environmental Protection Laws and Policies on the Scale and Structural Adjustment in Animal Industry In recent years, our government has introduced a series of environmental protection laws and policies such as the new Environmental Protection Law, the Regulations on Prevention and Control of Pollution from Large-Scale Livestock and Poultry Industry, the Plan for Prevention and Treatment of Contaminated Water, the Guiding Opinions on Adjusting the Layout of Pig Production in the Southern Water Network Region et al. These anti-pollution regulations stipulate the pollution prevention in animal industry, and especially limit the production scale in the regions of key water sources and their surrounding areas. According to the regulations and policies of the central government, the banned areas and restricted areas have been highlighted throughout the country, and pig farms in the prohibited areas are gradually relocated in the southern water-network area. The implementation of environmental protection policies not only further speeds up the withdrawal of individual pig farms to reduce the backward production model with unqualified environmental protection, but also expand the production capacity of large-scale farm with better breeding structure. In addition, the establishment of banned areas and restricted areas will enforce the adjustments of pig production capacity across the country. The adjustments of the scale composition of pig production and the relocation of pig production area will certainly have a profound impact on the existing capacity layout, market share, pricing, and business model of feed industry. The impact of environmental protection policies on the pig industry and feed industry induces existing competitive enterprises at the risk of reshuffle. Risk control measures included four aspects: (1) The company continually improves its service capability to farmers. In addition to feed products, the company is also engaged in the industrial fields of animal healthcare, vaccines, and finance, and connects closely with large-scale farmers. (2) The feed products of the company cover the field of livestock, poultry, and aquatic animals with abundant product lines. The producing lines for pig feed, chicken feed, duck feed and pelleted fish feed can be shared and switched. The company can rapidly shift the production layout according to the changes in the market through adjusting the production capacity in the manufacturers. (3) The company adopts multiple models to speed up the production layout in areas with abundant resources and permitted environment, and to obtain more market share in new animal farming areas. (4) The company continues to increase R&D investment, and the key technologies on microbial fermented feed and antibiotic alternatives have been effectively applied to foster the progress and development of the industry. 5. Risk of Exchange Rate Fluctuations The global procurement of feed raw materials has become the norm. The scale of overseas investment and operations of the company is also rapidly expanded. The scale of cross-border fund settlement and the stock of overseas assets have grown substantially, involved in various currency types of different countries. The currency exchange rate fluctuations are subject to different influence factors. The exchange rate fluctuations in any currency put certain impact on the settlement cost and asset value of the regions. Risk control methods include two aspects: (1) the company strictly controls the exchange rate risks, carefully selects settlement currencies to achieve relatively balanced regional fund inflow and outflow through structural arrangements of financing sources and financing types according to the scale, the model, and settlement characteristics of business in different regions and countries. (2) The expansion of two-way fluctuations in RMB exchange rate has become the new norm. The company increases its awareness of foreign exchange risk and arranges settlement models according to the procurement and sales strategies and the cycle characteristics of import and export operations, and flexibly used financial instruments such as forward foreign exchange settlement and sale, swaps, foreign exchange options and others to lock in exchange rate, control procurement and sales costs and the possible risks caused by exchange rate fluctuations. The statements involving the company's future plans in this report do not constitute substantial commitment of the company to any investors or related parties. Investors are kindly advised to aware investment risks. The proposed profit distribution plan of the Company was considered and passed by the Board: on the basis of the total number of shares on the date of record minus the repurchased shares when the plan is implemented in the future, the Company will distribute cash dividend of RMB 4.50 (tax inclusive) and 0 bonus share (tax inclusive) for every 10 existing shares held by all shareholders without capitalization of capital reserve. In this report, certain total numbers may not be exactly equal to the summation of their sub-item numbers as a result of roundoff. This report has been prepared in both Chinese and English. Should there be any discrepancies or misunderstandings between the two versions, the Chinese version shall prevail. The complete published Chinese 2022 Annual Report is available at the media designated for information disclosure. Table of Contents Section I. Important Notes, Table of Contents and Definitions .................................... 1 Section II. Company Profile and Key Financial Indicators .......................................... 9 Section III. Management Discussion and Analysis ..................................................... 15 Section IV. Corporate Governance .............................................................................. 57 Section V. Environmental and Social Responsibility .................................................. 90 Section VI. Material Matters ....................................................................................... 97 Section VII. Share Changes and Shareholder Information ....................................... 115 Section VIII. Preferred Shares ................................................................................... 122 Section IX. Bonds ...................................................................................................... 123 Section X. Financial Statements ................................................................................ 124 Documents Available for Reference 1. The financial statements signed and sealed by the head of the Company, the head in charge of accounting work and the head of the accounting department (Accounting Officer). 2. The original copy of the Independent Auditor’s Report signed and sealed by the CPAs, as well as sealed by the CPA firm. 3. The originals of all the Company’s announcements and documents which were disclosed during the Reporting Period. 4. The annual report disclosed on other securities markets.
CPA firm engaged by the Company
Sponsors engaged by the Company to continuously perform its supervisory function during the reporting period ? Applicable □ Not applicable
Financial Advisors engaged by the Company to continuously perform its supervisory function during the reporting period □ Applicable ? Not applicable VI. Major accounting data and financial indicators Retrospective adjustment to or restatement of the accounting data for prior years by the Company ? Yes □ No Reasons for retrospective adjustment or restatement Change of accounting policy
Business Enterprises (《企业会计准则解释第 15号》) (CK [2021] No. 35) (hereinafter referred to as “Interpretation No. 15”), which stipulates that where an enterprise sells products or by-products produced before a fixed asset is ready for its intended use or in the course of research and development (hereinafter collectively referred to as “Trial Sales”), it shall adopt the accounting treatments as stated in the Accounting Standard No. 14 for Business Enterprises—Revenue (《企业会计准则第 14号——收入》) and the Accounting Standard No. 1 for Business Enterprises—Inventories (《企业会计准则第 1号——存货》). These provisions are effective as of 1 January 2022. The Company has made retrospective adjustments for the impact of the accounting treatments
amounts as disclosed in the quarterly report or interim report
The Company had no other gain or loss that satisfied the definition of non-recurring gain or loss. Notes for the Company’s non-recurring gain or loss items as illustrated in the Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1 - Non-recurring Gain or Loss (《公开发行证券的公司信息披露解释性公告第 1号——非经常性损益》) defined as its recurring gain or loss items No non-recurring gain or loss items as illustrated in the Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1 - Non-recurring Gain or Loss (《公开发行证券的公 司信息披露解释性公告第 1号——非经常性损益》) were defined by the Company as its recurring gain or loss items during the reporting period. Section III. Management Discussion and Analysis I. Industry Situation during the reporting period 1. Basic situation and development stage of the industry The breeding industry is related to the national economy and citizen livelihood. It is the pillar industry of the agricultural and rural economy, the strategic industry that ensures food safety and quality of life for citizen, and the key industry to comprehensively promote rural revitalization and accelerate agricultural and rural modernization. As the core of animal husbandry, the breeding industry plays a role in linking the planting industry and the food industry. With the promotion of consumption upgrading, more strict environmental protection, green and high-quality and technological innovation, the trend of large-scale, intensive, and intelligent development of livestock and poultry breeding has accelerated, and the agglomeration effect of technology, talent and other factor resources has further been highlighted. At the same time, with the deepening of breeding scale-up and the improvement of technology, as well as the improvement of the demand for food safety, green and quality, the importance of upstream businesses around breeding industry including feed, seedling, animal healthcare et al are becoming increasingly prominent. The competition in the industry is accelerating, the integration continues to accelerate, and the degree of centralization is increasing. 2. The situation of the industry in 2022 In 2022, the feed industry and breeding industry experienced one bottoming pick-up process. In the first half of the year, there was significant price rise of raw materials, leading to an increase production costs in breeding and feed industry. At the same time, the weak consumption intensified the losses of breeding industry, forming the situation of squeezing each other among the upstream, midstream, and downstream of feed industry. In the second half of the year, breeding stock stopped cutting capacity , and the prices of products have started to rise, and the profit of breeding industry improved to varying degrees, and the financial pressure of farmers has decreased. The confidence in farmers have recovered with the increasing breeding stock and the enthusiasm for feeding. Both the breeding industry and the feed industry have gradually recovered due to significantly less suppression of the demand and the prices for feed products. However, due to the steep decline in consumer demand during the Spring Festival, the circulation of farming products was broken, disrupting the pace of farmers' fish production, especially for aquaculture which was supposed to be the peak period of fish production before the Spring Festival, and the overall storage volume was relatively high. More details as followings, 1. In terms of raw materials for bulk agricultural products, the prices fluctuated sharply due to the international situation, abnormal weather, and other factors, resulting in overall high-cost performance. According to the data from the Ministry of Agriculture and Rural Affairs, the annual average domestic price of corn is about 2,900 yuan/ton, maintaining the historical high. The annual domestic average price of wheat exceeds 3,300 yuan/ton, which is the highest in the past three years. The price of domestic soybean meal has experienced twice rapid increases throughout the year, rising from the peak of 3,700 yuan/ton at the beginning of the year to over 5,500 yuan/ton. The prices of rice, fish meal and other meal types increased in varying degrees. It was challenged to inform in time and effectively to downstream farming industry under circumstance of rapid, significant, and widespread price increases in raw materials. 2. In terms of breeding industry: ① the profitability of poultry industry dropped in the first half of the year and was recovered in the second half of the year. The African swine fever virus resulted in the shortage of pig production, the poultry industry increased sharply driven by the substitution effect of poultry meat and price dividend. From the second half of 2020 to the first half of 2022, there had been a long period of loss in the poultry industry owing to the less impact of African swine fever virus, the high cost of poultry farming along with weak end-consumption of poultry, as a result, and the production capacity was decreased in all links. In the second half of the year, as production capacity decreased and end-consumption increased, the business of poultry farming chain became profitable, and the cash-flow of farmers was repaired. However, due to high prices of seedling and feed, and transportation concerns of policy, farmers were initially cautious about increasing their livestock stock. The pace of poultry breeding and restocking is gradually accelerating with the increasing of the supply of poultry seedlings in the later stage, as well as the enhancement of logistics certainty and other favorable factors. ② the pig production had further recovered, and its price had fluctuated sharply. Throughout the year of 2022, 699.95 million pigs were sold, an increase of 28.67 million or 4.3% compared to the previous year. The annual pork production was 55.41 million tons, an increase of 2.46 million tons or 4.6% compared to the previous year. At the end of the year, there were 452.56 million pigs, an increase of 0.7% year-on-year. Among them, 43.9 million sows can be bred, an increase of 1.4% year-on-year. The price of live pigs dropped first, and then went up from 12.29 yuan/kg in March to 27.09 yuan/kg in October with an average profit of over a thousand yuan per head, and quickly back to 20.01 yuan/kg at the end of the year. Although the market fluctuates sharply, farmers still kept good profit throughout the year owing to cost advantages, stable business, and high efficiency of production. ③ the trend of special aquaculture transformation in the aquaculture industry was promising, and the development of aquatic products in household consumption went well. The consumption upgrading and rising costs have led to the transformation from low gross profit species such as the four domestic fishes to special aquatic products such as snakehead, California perch, white-leg shrimp and monodon shrimp. The breeding model has also been explored and developed in the direction of specialization and high efficiency. Throughout the year, the prices of grass carp, carp, crucian carp, and tilapia were low, and the enthusiasm of farmers dropped to the bottom. The cultivation of grass carp and tilapia in Guangdong decreased by more than 30%. In terms of special aquaculture products, the demand for most species such as grouper and yellow catfish was sluggish throughout the year due to its highly depending on catering channels and circulation. Special aquatic products for household consumption, such as South American white shrimp, snakehead, crayfish, etc., had high enthusiasm among farmers and increased breeding capacity. However, the demand of fish at the end of the year suddenly decreased, resulting in the short-term pressure of low price due to excessive storage, slowing down the overall pace of aquaculture. Until later, when the fish consumption returned to normal, especially with the rapid rising demand of special fish, the prices came back the norm. 3. The feed industry had also experienced a bottoming pick-up process, many small and medium-sized feed enterprises faced further tightened cash-flow, worse debt ratio, and the catalyzing liquidation of production capacity. In the first half of the year, the rapid increasing in raw material costs, huge losses in the breeding industry, and the decreasing in market capacity led to exceptionally fierce industry competition. In the second half of the year, the pressure has been reduced with the recovered cash-flow in the breeding industry, but small and medium- sized feed manufacturers still faced enormous pressure. The domestic feed production increased slightly year-on- year throughout 2022. According to the China Feed Industry Association, the total industrial feed production in China was 302.234 million tons, a year-on-year increase of 3.7%, the significant decrease in growth compared to 2021. Among them, the total feed production in the first half of 2022 decreased by 4.3% year-on-year, with the increase mainly in the second half of the year. Due to continuous losses and financial problem in the first half of the year in the livestock and poultry industry, farmers behaved more concerned about external factors such as feed prices and sell on credit quotas. In the face of the rapidly deteriorating external environment, most feed enterprises had reduced profitability to varying degrees, aiming to maintain market share and slow down the increase of feed products. In the first half of the year, the weighted average price of national formula feed products increased by 6.9% year-on-year, far lower than the increase in main raw materials such as corn, wheat, and soybean meal. In the second half of the year, with the recovery of profits in the aquaculture sector and the repair of cash-flow, the profits of feed enterprises showed signs of improvement. Until November 2022, the weighted average price of formula feed nationwide has increased by 13% year-on-year. II. Main businesses of the company during the reporting period The company laid out the industrial chain with the aim of providing overall services to animal farming. It has formed a relatively complete aquatic product industrial chain, and the livestock and poultry industrial chain has also gradually been constructed. The main products include high-quality animal seedlings, feed, animal healthcare and pig breeding. The business operation has covered all business links such as R & D, designing, producing, sales and service of various products. Specifically, the company's products include feeds for chickens, ducks, geese, pigs, fish, shrimps, and crabs, breeding varieties such as pigs, shrimps, fish fry and chickens, as well as biological products, veterinary medicine, vaccines, and other products required for producing livestock, poultry, and aquaculture. 1. Main business and products (1) The business of feed seedling and animal healthcare were interacted to form Gold Tringle Feed business is the core foundation of the company. Based on fully understanding the needs of farmers, the company has developed aquatic seedlings and animal healthcare products as supplements to facilitate the growth of the feed business over ten years relentless efforts. After more than 20 years of development, the company's feed business has accumulated a wide range of customer resources. Through providing customers with high-quality valuable seedlings and cost-effective feed products in the market, relying on breeding services to drive the development of vaccines, veterinary medicines, biological products and other animal healthcare products, the company can better support customers to achieve breeding success through the full set of services, and help customers realize that healthy farming at the same time, resulting in better controlling the breeding cost and obtaining the competitive advantage in respect of end products. (2) the patient development of breeding industry under the premise of stability Based on the healthy development of feed, seedling and animal healthcare business, the company has formed the core competitiveness in breeding industry, therefore in recent years, the company has begun the cultivate breeding and food processing business. In terms of livestock and poultry, the company mainly focuses on pig breeding, and promotes team capacities in poultry section. In terms of aquaculture, the company has started the cultivation and processing of special aquatic products such as raw fish and shrimp by using its own high-quality seedlings, feed and animal protection products. With the company's investment in aquatic product research and development and the presentation of achievements, the company will gradually expand the cultivation of other high-quality fish and shrimp products. 2. Major business model The company started its development from the feed business. Due to the abundant customer resources, based on deeply understanding and excavating the needs of customers, the company continuously enriched and provided customers with products and services. From feed to seedling breeding, veterinary medicine and vaccine product R & D and manufacturing with higher technical and economic added value, the production and marketing scale of high value-added products gradually expanded, and the proportion of income structure also increased year by year. In recent years, through the extension of the industrial chain, the company has begun to gradually go further into the industrial links such as breeding and food processing. The business model has been orderly developed and extended with various industrial sectors supporting and developing each other. (1) Feeds, seedlings and animal healthcare products business With the increasing scale of feed business, the business management is mainly carried out with the business model （未完）  |