Securities code: Shenzhen Kingkey Smart Agriculture Times Co.Ltd(000048) securities abbreviation: Shenzhen Kingkey Smart Agriculture Times Co.Ltd(000048) Shenzhen Kingkey Smart Agriculture Times Co.Ltd(000048)
Record of investor relations activities
No.: 2022007
□ research on specific objects (including visits by individual investors) □ analyst meeting
□ media interview \uf0a3 performance briefing
Category of investor relations activities □ press conference □ Roadshow
□ site visit
□ others (telephone access Conference)
Penghua Fund – Wang Zonghe
Great Wall Fund – Yang Jianhua
Southern Fund – Mao Wei
Boshi Fund – Guo Jun, Cai bin, Gao Hui, Messrs
Guangfa fund Luo Yang
Dacheng Fund – Qi Weizhong
Zhongrong Fund – Chen Fangyuan
Huaxi Securities Co.Ltd(002926) – Zhou Sha
E fund – Xiao Nan, Zhou Guangyuan
Hua’an Fund – Zhang Liang
Participant / unit name: Haifutong Fund – Liu Wenhui, Zhang Zhiqiang, Qu gukai, Liu Chun, Liu Tsui
Huitianfu Fund – Tian Li
Yinhua Fund – Zhang Jian
Huabao Fund – Li Huiyong
Changxin Fund – Ni Wei
Bond capital – Guo Yulan, Xiong Shaojian, Peng bin
Kaifeng investment – Wang Dongsheng, He Qi
Yingfeng capital – Li Minggang
Lansi investment – Zhang Yishun
etc.
Time: 15:30-17:00 PM, April 8, 2022
Location: company conference room
Actual controller: Mr. Chen Hua
Mr. Xiong Wei, chairman
Mr. Bagan, director and President
Mr. Cai Xinping, director and vice president
Name of company Receptionist
Mr. Wu Zhijun, vice president and chief operating officer
Mr. Xie Yongdong, vice president
Mr. Shang Pengchao, Secretary of the board of directors
Ms. Wu Yuli, chief financial officer
The main communication contents are as follows:
Q1: the company’s pig breeding business in the first quarter?
A1: 229300 pigs (including 29600 piglets) were sold in the first quarter of 2022, and the average production cost of fat pigs was about 16.83 yuan / kg.
Q2: first quarter cost split?
A2: in terms of production cost composition, feed cost accounts for about 60%, Depreciation accounts for about 14% – 16% (including pig depreciation), labor cost accounts for about 14%, and medicine seedlings and others account for about 12%.
Q3: how much can the company reduce the total cost of fattening pigs in 2022? Through what path?
Main activities of investor relations: affected by factors such as changes in the international situation, the price of raw materials fluctuated sharply this year, based on the introduction of raw materials
The price is at a high level and the company’s breeding projects are still in the stage of capacity release. It is estimated that the full cost of fattening pigs in 2022 will be 17-17.5 yuan / kg. The cost reduction path mainly includes:
(1) Reduce the unit production cost by improving production efficiency, capacity scale and pig health;
(2) Through the production of each feed plant, the feed supply can be changed from entrusted processing mode to self supply and self production mode, and the OEM cost and freight can be reduced;
(3) When the company purchased breeding pigs in the early stage, it was at a high market price, resulting in high breeding costs and depreciation expenses. At present, the company has established a self breeding system to supply sows for later projects, so as to reduce the cost of sows and reduce the production cost;
(4) Reduce the cost of feed raw materials through timely procurement, raw material substitution and precision nutrition. Specifically, the public
On the one hand, the company locks the feed cost in advance through centralized procurement, long-term procurement and other arrangements. On the other hand, the company scientifically adjusts the feed formula according to the price changes of feed raw materials and alternative raw materials, Optimize the cost while ensuring nutrition (the regional port where the company’s project is located is convenient and close to the Southeast Asian market. The feed raw material resources in this region are extensive, rich in varieties and low prices. The convenient import conditions provide guarantee for the cost optimization of the company’s feed formula and the purchase and supply of alternative raw materials). Q4: Why did the company choose the building breeding mode? How to realize that the cost is lower than that under the traditional mode? A4: the company chose the building breeding mode, first of all, because the south area where the company is located is not as flat as the north. Using building breeding can realize land intensification and produce more pigs on the same land area; Secondly, compared with the traditional model, building breeding adopts the all in and all out method, which has relatively high management efficiency and obvious advantages in biosafety prevention and control; In addition, the company’s building project adopts the integrated breeding mode of “6750” standardized production line (6000 sows, 750 ancestors and corresponding fattening). Each production line is equipped with about 210 people as standard. Compared with the traditional flat breeding, the personnel are relatively concentrated and easy to manage.
The company’s building breeding project in Gaozhou has initially reached production capacity, and the production cost in the first quarter is about 14.89 yuan / kg, with good results. With reference to this achievement, in the case of limited land resources, the building breeding mode is also a better choice, and the comprehensive cost can be reduced by reducing the operation cost, improving the management level and personnel efficiency. Q5: the company previously planned a pig breeding capacity of more than 10 million pigs. What is the regional distribution? Facing the bottom of the cycle, is the company confident to continue to promote the plan? A5: the company has previously signed a framework agreement on investment in pig breeding with local governments. The investment planning is mainly located in Xuwen, Gaozhou, Yangjiang and other counties and cities in Guangdong, Hezhou in Guangxi and Wenchang in Hainan, of which more than 60% of the production capacity is in Guangdong. In 2021, the pig market was depressed, the pork price continued to fall below the cost line, and the pig breeding enterprises generally suffered losses. Combined with the changes of market conditions, the company has made corresponding adjustments in the promotion rhythm of reserve projects. At present, the pig breeding projects invested and constructed by the company include Xuwen, Gaozhou, Wenchang and Hezhou projects, which are still in the stage of project construction (Hezhou phase II) and gradual improvement of production capacity. In 2021, the impact of pig cycle loss is relatively small, and the company is positioned to serve the Great Bay market of Guangdong, Hong Kong and Macao. The market price of pork products is generally higher than the national average level, which has obvious regional price advantages. At the same time, the company has sufficient cash flow to stabilize the bottom of the cycle. In the future, the company will continue to promote the implementation of the established strategy and focus on the completed pig breeding projects and in the short term
For the production and operation of the feed plant, the company will make reasonable arrangements for some reserve projects that have completed land transfer according to the changes of market conditions. Q6: does the company consider carrying out M & A? A6: the company has abundant cash flow and continues to pay attention to M & A opportunities in the industry. While improving the operation and management ability of the team, the company carries out M & a timely in combination with market changes. Q7: in addition to real estate and breeding business, what are the company’s plans for other businesses such as feed and food? A7: for feed business: Dongguan feed company, a subsidiary of the company, is mainly committed to the R & D, production and sales of chicken feed and aquatic feed, with an annual profit margin of tens of millions. It will continue to carry out relevant business in the future. The company invested in the construction of feed plants in the location of each project, mainly to meet the needs of its own pig breeding projects, and realize the transformation of feed supply from entrusted processing mode to self supply and self production mode. For poultry business: Huizhou company, a subsidiary of the company, is engaged in poultry breeding business with a small scale. The follow-up business will continue to be carried out along the direction of the company’s modern agricultural strategy. For food business: the company continues to carry out food end construction with the following food companies as the main body, and its products have been stationed in chain stores, large food enterprises, new retail and other channels. As the number of live pigs gradually reaches the scale, the company will actively explore and develop the slaughtering business and food business to realize the extension of the industrial chain. Q8: what are the reasons for high dividends? A8: high dividend is the performance of abundant cash flow. The precondition for the company to formulate profit distribution plan is to ensure the normal operation capital needs of the company. After distribution, the company’s capital is fully enough to support the capital expenditure of pig breeding business. At present, the company’s working capital is mainly used for pig breeding industry. In addition to the existing cash, the company can make full use of the rolling retained funds formed in daily business activities (especially the sales of real estate projects) to meet the capital needs of the project. Based on the above considerations, at the same time, in order to share the company’s operating results with investors, give investors a stable return and enhance investors’ confidence in the company’s investment, the company puts forward this profit distribution plan on the premise of ensuring the company’s normal operating capital needs, especially the construction capital needs of the company’s pig breeding industrial chain project. Q9: is there a plan to implement equity incentive?
A9: the formulation and implementation of equity incentive plan are affected by market conditions and other factors. Please refer to the information disclosed by the company for details.
Q10: how does the controlling shareholder Jingji group view the pig breeding industry and the business development of Shenzhen Kingkey Smart Agriculture Times Co.Ltd(000048) ?
A10: China is a country with a large population. Pig breeding is an important part of agriculture. Pork is the main meat for most urban and rural residents. Therefore, the healthy and stable development of pig breeding industry is very important for the supply of people’s livelihood and food safety in China. At the same time, as an industry strongly supported by national policies, the pig breeding industry is facing significant development opportunities and broad development space. Therefore, the controlling shareholder Jingji group is optimistic about the pig breeding industry for a long time.
In 2018, African swine fever brought integration and reform to the pig breeding industry. Large scale pig breeding has good development prospects, market space and policy dividend support. Shenzhen Kingkey Smart Agriculture Times Co.Ltd(000048) itself has excellent feed business foundation and breeding business foundation, and has the strength to develop professional, industrialized, standardized and intensive pig breeding. Since the transformation of pig breeding, Shenzhen Kingkey Smart Agriculture Times Co.Ltd(000048) pig breeding business has achieved certain results, local projects have been put into operation gradually, the sow stock has formed a certain scale, and the production capacity has been gradually released. With regard to the current cyclical losses in the pig breeding industry, Shenzhen Kingkey Smart Agriculture Times Co.Ltd(000048) currently has sufficient funds and excellent operation and management ability to tide over the cycle trough. Jingji group is full of confidence in the development of Shenzhen Kingkey Smart Agriculture Times Co.Ltd(000048) pig breeding business and will provide all-round support.
Q11: what is the current financial situation of the controlling shareholder and whether there is a risk of share pledge?
A11: Jingji Group operates well, with total assets of more than 100 billion yuan and asset liability ratio of less than 70%, of which the asset liability ratio of real estate sector is about 50%, which is at a good level in the industry. Share pledge is a conventional means of financing, and the risk of pledge is high
