Report summary: Event summary: On August 18, the company released the 2017 semi-annual report. From January to June, the company achieved operating income of 1,649 billion yuan, an increase of 56.44%; net profit of 302394 million yuan, a year-on-year decrease of 56.18%; net profit of 16.8671,000 yuan, a year-on-year decrease of 75.21%; and earnings per share of 0.03 yuan. According to the performance forecast for the first three quarters, the company's net profit from January to September 2017 is estimated to be 20 million yuan to 50 million yuan, compared to 92.056 million yuan for the same period last year, a year-on-year decrease of 78.27% to 45.69%. Production increased sharply in the first half of the year, and profits are expected to be released in the second half of the year. The first half of the year was affected by the bird flu epidemic, insufficient market demand, and poor consumption. Poultry prices were low, and the overall sales ratio of frozen duck and frozen chicken, which increased sharply in production, declined. In January-June, frozen duck and frozen chicken production were 75878 tons and 21965 tons, respectively, up 69.45% and 130.63% year on year. Sales volume was 549 million yuan and 183 million yuan respectively, up -16.07% and 58.20% year on year, respectively. Increased production was in the form of inventories and waited for sale at appropriate prices. Driven by warmer seasonal demand and rising chicken prices in the second half of the year, the company's frozen duck and frozen chicken products are expected to rise sharply in volume and price, freeing up profits. Good cost control and avant-garde management thinking. Corn, soybean meal, wheat, soybean oil, and down are the main raw material costs for the company's products. In the first half of the year, corn prices rose 13%, wheat fell about 6%, and soybean meal and soybean oil fell 15%-17%. The quarterly report and semi-annual report show that the company's prepayments and inventory have increased dramatically. In addition to the increase in poultry product inventories, the company purchased a large amount of corn in Northeast China in the first quarter, and its subsidiary Huaying Xintang increased its down purchases, while corn and down continued to rise in the first half of the year, and duck down rose continuously in the first half of the year, and duck down increased by more than 50%, showing that the company had a good grasp of the procurement timing of raw materials. In order to avoid excessive price fluctuations on the raw material side, the company began hedging business in 2016. The initial futures deposit investment was no more than 20 million yuan. The leverage attributes of commodity futures can control raw material costs several times that of security deposits, making it optimistic about the company's future effectiveness in cost control. The whole industry chain layout calms cycle fluctuations and increases added value. The company has established a complete industrial chain integrating ancestral duck breeding and incubation, commercial duck/chicken breeding, processing and sales of poultry products and their products, and feed production and sales, so that the company has the means to regulate the production and sales ratio of various products in the industry chain, such as duck/chicken seedlings, frozen products and cooked food, etc., enhancing the company's ability to withstand cyclical downturns and share industry conditions. Risk warning: prices of duck, chicken and feather products have declined, bird flu outbreak