Financial Associated Press, October 27 (Reporter Zhang Chenjing)Previously, benefiting from capacity expansion, Aonong rose rapidly and jumped into the "top five clubs" of A-share pig enterprises this year, but high-cost expansion "ran into" a long pig cycle, and Aonong's losses expanded again in the first three quarters of this year. At the same time, the asset-liability ratio has reached 89%.

As of the third quarterly report, Aonong had recorded losses for three consecutive years. According to the company's three-quarter report, the company's operating income in the first three quarters was 15.177 billion yuan, down 1.47 percent from the same period last year. The net profit loss attributed to the owner of the parent company in the first three quarters was 1.29 billion yuan, and the net loss in the same period last year was 573 million yuan, down 125.22 percent from the same period last year.

In addition to the breeding sector, Aonong biology also has feed, animal protection and other business, pig farming only accounts for less than 30% of the company's main income. For the losses in the first three quarters, Aonong explained that the company's performance losses were mainly caused by the breeding sector, pig prices were generally low, and the company's pig production increased compared with the same period last year, resulting in losses in the pig farming business. During the reporting period, the company optimized inefficient breeding units, and the closure of pig farms led to the elimination of pigs, rental depreciation and other losses of about 380 million yuan.

In order to control operational risks, some pig companies have announced a reduction in capacity plans and a shift of focus from expansion to cost control this year. In terms of optimizing production capacity, Aonong Bio recently told investors that some leased and cooperative pig farms are being withdrawn in an orderly manner, especially those with old equipment and facilities and small-scale farming units. optimize inefficient farming units with higher costs or poor outlying facilities. This will cause part of the adjustment cost of shutting down idle capacity, but it will help to improve regional concentration and matching, and continue to improve the existing high-quality aquaculture volume. At the same time, in the current pig market downturn, the production capacity and storage scale should be properly controlled to ensure the operation of the feed and slaughtering food industries.

It is worth mentioning that at present, the elimination of pig production capacity is slow, and the pig cycle is lengthening. In the absence of a significant improvement in market supply and demand, cash flow is very important for pig enterprises with "high debt and low profit".

In terms of cash flow, in line with other pig enterprises, the net cash flow generated by Aonong's operating activities in the first three quarters remained in a state of inflow this year, with an amount of 661 million yuan, but the company's asset-liability ratio continued to rise. as of the third quarter, it has reached 89.41%, higher than the industry average.