主营业务销量向好，助力营收稳健增长。1）饲料业务：23 年饲料销量/收入同比+7.9%/+5.3%至431 万吨/165 亿元；其中猪/禽/反刍料销量同比-0.1%/+22.7%/+0.9%。我们认为或因公司禽料新厂产能爬坡，叠加公司23年加强规模场大客户开发力度。2）肉禽业务：23 年参控股企业合计屠宰/分割品产销/调理品及熟食产销同比+13%/+14%/+19%至8.1 亿羽/212 万吨/3.2 万吨。主因河北现代化新工厂投产，带动肉禽业务收入同比+20.8%至112 亿元。3）生猪业务：23 年控参股企业合计生猪出栏量/收入同比+18.9%/+25.2%至116 万头/26 亿元，其中肥猪/仔猪/种猪出栏91/21/4 万头。公司主动控制总体养殖规模，优化内部养殖结构，出栏增速放缓。2023 results are in line with forecasts and in line with market expectations
Hefeng Co., Ltd. announced its 2023 results: revenue of +9.6% YoY to RMB 35.97 billion, net profit to mother of -189.0% YoY to -460 million yuan; of these, 4Q23 revenue was -2.3% YoY to RMB 9.08 billion, and net profit to mother was -403.1% YoY to -50 billion yuan; the results were in line with forecasts and in line with market expectations. The pressure on the company's performance was mainly due to sluggish meat, poultry and pig prices, as well as accrued credit and asset impairment losses of 180 million yuan.
Development trends
The sales volume of the main business is improving, contributing to steady revenue growth. 1) Feed business: Feed sales/revenue in 23 years +7.9%/+5.3% YoY to 4.31 million tons/16.5 billion yuan; of these, pig/poultry/ruminant sales volume was -0.1%/+22.7%/+0.9% YoY. We think it may be because the production capacity of the company's new poultry plant is climbing, and the company has strengthened its development efforts for large-scale farm customers over 23 years. 2) Meat and poultry business: In 23 years, the total production and sales of slaughtered/split products/prepared products and cooked food production and sales increased 13%/+14%/+19% year-on-year to 81 million birds/2.12 million tons/32,000 tons. Mainly due to the commissioning of a new modern plant in Hebei, the meat and poultry business revenue was +20.8% year-on-year to 11.2 billion yuan. 3) Pig business: The total volume and revenue of participating companies in 23 years increased 18.9%/+25.2% to 1.16 million heads/2.6 billion yuan, including 91.21 million pigs/piglets/breeding pigs. The company actively controlled the overall farming scale, optimized the internal farming structure, and slowed the growth rate of listing.
Interest rates on chicken and pig hair have declined, depreciation accruals have increased, and profitability has been put under pressure in stages. 1) Gross profit margin: The gross margin in '23 was -2.0ppt to 3.8% year on year. We think it is mainly due to the high cost of chicken seedlings in '23, and the terminal prices of chicken and pig terminals were low. The gross margin of the company's meat, poultry and pig business declined by 3.7/13.2ppt, respectively.
2) Expense ratio: The 23-year sales/management (including R&D) /financial expenses ratio was +0.1 ppt/flat compared to the same period, respectively, and cost control was relatively good. 3) Impairment: Total asset and credit impairment losses in 23 years were +336.9% year-on-year to 180 million yuan, mainly due to lower inventory prices for chicken and pigs in '23. Under the combined influence, the company's profitability was under phased pressure, and the net profit margin for 23 years was -2.8ppt to -1.3% year-on-year.
We are optimistic about expanding production capacity and reducing costs and increasing efficiency, and we are optimistic about the flexible release of the company's performance. 1) At the industry level, the prices of corn and soybeans for feed have declined this year. Taking into account 2H24 pig price reversal expectations, we expect there is room for improvement in the profitability of feed and breeding. 2) At the company level, on the one hand, the company has actively expanded its production capacity in recent years. The export targets for feed export, broiler slaughter, and pig export in 24 years are +10% or more, +6% to over 860 million birds, and +3% to 21% to 1.2 million heads, respectively. On the other hand, the company continues to improve the degree of compatibility in all aspects of the meat and poultry business, optimize the pig breeding structure, and focus on reducing costs and increasing efficiency in the long term.
Profit forecasting and valuation
The current stock price corresponds to 24 times 11 times P/E. We kept our 24-year net profit forecast of 580 million yuan unchanged, introduced a 25-year net profit forecast of 770 million yuan, and maintained a target price of 9.3 yuan. The target price corresponds to 15 times P/E in 24 years, with 30% upward space. Maintain an outperforming industry rating.
risks
Fluctuations in raw material prices; sluggish aquaculture; risk of the epidemic.
