On July 3, 2009, I went to Zhenghong Science and Technology headquarters to meet with Mr. Zhou Xiahua, the secretary of the board of directors, to understand the recent situation of the company. The key points are: the change of the board of directors of the company, the adjustment and layout of the operation of the company by the new chairman, and the impact of the decline in pig prices on the feed business of the company; market rumors that the bio-pharmaceutical company has produced drugs that can prevent and cure swine flu is true; the company's handling of Haiyuan Foods.
Q: the change of management, is the operation of the company adjusted? a: the replacement of the chairman is mainly due to the retirement age of the former chairman. Mr. Xu Zhongkang, the new chairman, has not been engaged in the feed business before, and there will be a familiar process after taking office. But the president has not changed, the company's original operating conditions will not change in the near future, will still be a major business, five major plates as the main line.
Q: briefly introduce the company's main business? a: the company takes agriculture as the main line of development, which is divided into five parts: feed, breeding, slaughtering, trade and biopharmaceutical. The company has 33 wholly-owned, holding and shareholding enterprises in 16 provinces, cities and regions of Hunan and Hubei, and has 42 microcomputer-controlled production lines, which mainly produce Zhenghong brand pig, chicken, duck, fish, cattle and sheep feed products of more than 120 varieties. The annual production capacity reached 2 million tons, and the actual output in 2008 was only more than 600,000 tons. At present, the annual production of 30,000 improved breed sows are sold all over the country, and 100000 commercial pigs are mainly sold to Guangdong. The decline in pig prices has had a negative impact on the company's operation.
Q: what is the prospect of the product market? At present, the main domestic customer group? a: the company's gross profit is concentrated feed, and the gross profit of other feed is about 6%. With the further concentration of large-scale breeding, the price raising ability of the company's products has been weakened. At present, the main groups are farms and farmers.
Q: does the company participate in the trading of pig futures and frozen pork reserves in Hunan? a: the company is not involved in either of these two businesses, and the company's frozen storage capacity is only a few thousand tons, and the slaughtering business is in a semi-closed state.
Q: feed cost structure of the company? The impact of raw material price fluctuations on the company? a: feed costs are mainly corn, soybean meal, fishmeal, additives and so on. The company's raw material prices have risen to a certain extent, but feed prices have also risen synchronously, and its gross profit margin is basically stable. The source of raw materials is mainly from state-owned grain reserves and large oil factories.
Q: Yixing Zhenghong Feed Co., Ltd. suffered a large loss, the reason is? a: Yixing Zhenghong Feed Co., Ltd. suffered a large loss mainly because the company is mainly aquatic feed. In 2008, there were great changes in local aquaculture in Yixing, mainly due to disasters and other factors leading to a decline in farming area, which is expected to be better this year.