Securities abbreviation: Joyvio Food Co.Ltd(300268) securities code: Joyvio Food Co.Ltd(300268) SZ Joyvio Food Co.Ltd(300268)
Demonstration and analysis report on the scheme of issuing A-Shares to specific objects in 2022
April, 2002
Joyvio Food Co.Ltd(300268) (hereinafter referred to as ” Joyvio Food Co.Ltd(300268) “, “company” and “listed company”) held the 16th interim meeting of the 4th board of directors, deliberated and approved the relevant proposals of the company on issuing shares to specific objects. According to the provisions of the measures for the administration of securities issuance and registration of companies listed on the gem (for Trial Implementation) and the detailed rules for the implementation of non-public development of shares by listed companies, the board of directors of the company prepared the demonstration and analysis report on the scheme of issuing A-Shares to specific objects.
In order to meet the capital needs of the company’s business development and enhance the company’s capital strength and profitability, in accordance with the provisions of relevant laws, regulations and normative documents such as the company law of the people’s Republic of China, the securities law of the people’s Republic of China, the articles of Association, the measures for the administration of securities issuance and registration of companies listed on the gem (for Trial Implementation), and the detailed rules for the implementation of non-public offering of shares by listed companies, The company plans to implement the plan of issuing shares to specific objects, and the total amount of funds raised shall not be less than 515632000 yuan (including this amount) and not more than 773448000 yuan (including this amount). All the funds raised are intended to be used to supplement working capital after deducting the issuance expenses.
1、 The necessity of this issuance of securities and its variety selection
(I) types of securities to be issued this time
The type of shares issued to specific objects this time is domestic listed RMB ordinary shares (A shares), with a par value of RMB 1.00 per share.
(II) necessity of selection of securities issued this time
1. Fully grasp the opportunity of “healthy China” and promote the strategic layout of “global resources + Chinese consumption”
The “healthy China” strategy put forward at the 19th National Congress of the Communist Party of China has provided unprecedented development opportunities for the development of the company. With the mission of “looking for global high-quality food materials and providing high nutritional protein food for Chinese consumers”, the company adheres to the development strategy of “global resources + Chinese consumption”, and builds a high-quality food supply chain and super nutritional food through super nutritional food materials rich in omega-3, so as to help realize the national strategy of “healthy China”.
As a representative of the high-quality food materials provided by the company, salmon will be increasingly tight in supply and demand will continue to grow from the long-term trend in the future. In the near future, salmon prices have gradually recovered and salmon breeding costs have gradually increased. As a representative of high-quality seafood protein, salmon is mainly supplied from artificial breeding. However, due to the Limited breeding area and the scarcity of breeding licenses, the global supply will become increasingly tight in the future. Kontali, a professional research institution in the industry, predicts that the growth rate of global salmon supply will slow down in the next few years. The average annual compound growth rate from 2020 to 2024 is expected to be 4%, of which the growth rate of global salmon supply in 2022 is less than 1%. With the growing global population, the expanding middle class in emerging markets and the strengthening of people’s health concept, the demand of the global salmon market will continue to grow in the long run. According to the relevant research data in the salmon breeding industry report of Meiwei in 2021, the annual compound growth rate of the total amount of global salmon consumption in the past decade has reached 8%. Therefore, in the long run, the global salmon market demand is relatively strong. Since 2021, with the gradual mitigation of the impact of covid-19 epidemic, the end market demand and sales price of salmon have shown a rapid recovery momentum. According to the latest report of data Sal Mo n, the price of salmon in Chile has shown a rapid upward trend since 2021. Compared with 2020, the average price of Chilean fish fillet trim D (3-4 pounds) sold to the United States in 2021 increased by 33% year-on-year; The average price of Chilean whole fish (12-14 pounds) sold to port Monterey, Brazil increased by 58% year-on-year; The average price of Chilean whole fish (6 + kg) sold to Shanghai, China increased by 41% year-on-year. Affected by the epidemic situation, global inflation and other factors, the prices of bulk commodities such as wheat, corn, vegetable oil, fish oil and fish meal, which are the main raw materials of feed, have continued to rise since the second quarter of 2020 and are still at a high level, thus promoting the continuous rise of feed costs. The average feed cost of the global salmon industry accounts for about 45% – 55% of the cage cost. Affected by this, the salmon breeding cost is also gradually rising.
Affected by the epidemic, the import volume of narrow COD and Arctic sweet shrimp in China’s industry decreased in 2021, and the company’s subsidiary Qingdao Guoxing continued to maintain its leading position in the industry. According to the data of China Customs Bureau of statistics, China imported 382300 tons of frozen narrow COD in 2021, down 37.04% from 607200 tons in 2020. In 2021, China imported 38600 tons of frozen Arctic shrimp, down 23.41% from 50400 tons in 2020. As a leading narrow cod processing supplier in China, Qingdao Guoxing has been deeply engaged in the industry for many years. With rich product types and mature processing technology, it can meet the different needs of different customers. At the same time, it has established a stable cooperative relationship with upstream suppliers and downstream customers.
The company actively grasps the general trend of consumption upgrading, focuses on the field of high-quality animal protein represented by imported seafood, and continues to forge its core competitiveness in core category control, omni-channel sales service, quality control, supply chain control, brand construction, etc. Through its subsidiary australis, the company has substantially controlled the scarce high-quality resources in the upstream, will continue to optimize the operation efficiency of the subsidiary, and will carry out fine management in seedling raising, mariculture, product R & D, processing and production, market layout, channel sales development, brand construction and other aspects. At the same time, seize the development opportunities of the industry, learn from the management mode and business philosophy of the seafood industry in mature markets, and strengthen the development of the Chinese market. By opening up the upstream and downstream of the industrial chain, combined with brand building and channel development, expand the company’s comprehensive influence and industry leadership in China’s salmon industry, and build the company into a leading enterprise in the field of global high-quality protein.
2. The company has a complete ecological industrial chain and a global food safety system. It has entered the field of 3R prefabricated dishes and nutritious meals and has the dual trust of raw materials and food safety
In the field of seafood protein, the company has the advantage of controlling the upstream high-quality salmon resources, and has a perfect global food safety assurance system and third-party authoritative certification, which provides a strong support for the company’s research and development of high-quality seafood protein healthy and nutritious food with salmon as its food material and prefabricated cuisine products.
In terms of salmon breeding and processing safety, the company has obtained the BAP (best aquaculture practice) certificate issued by the global aquaculture alliance. BAP certification is a global examination for aquaculture enterprises. Based on risk management and control, it evaluates the management level of enterprises from multiple dimensions such as food safety, environmental protection and social responsibility, promotes enterprise improvement, and finally achieves the unity of environmental, social and economic benefits.
The BAP certification obtained by the company is the highest 4-star logo, that is, the whole industrial chain of feed, seedling raising, breeding and processing has passed rigorous on-site investigation and annual review. In addition, in July 2020, the salmon harvested by the company at Punta obstrucci ó n fishery in Magellan District, Chile won the full cycle health and safety aquaculture certificate issued by the Chilean fisheries regulatory authority (sernapesca). The acquisition of the above certificates reflects the company’s professional technology and advantageous position in the whole salmon industry chain, enhances the competitiveness of the company’s salmon products, and lays a solid foundation for the follow-up company to provide customers and consumers with more high-quality salmon products.
The company has strong resource advantages in the field of deep-sea protein raw materials, namely salmon, and has a perfect global food safety system and third-party authoritative certification. It provides a strong endorsement of trust for the company to cultivate and develop deep-sea high-quality protein health nutrition food and 3R prefabricated dishes based on salmon, which is conducive to the company to develop a variety of convenient and fast-food value-added products based on high-quality animal protein for different consumer groups and scenarios, For example, children’s nutritional dietary products, instant fitness low-fat salmon favored by young white-collar workers, etc. The development of value-added products is not only conducive to the diversification of the company’s product forms and the improvement of the added value of the company’s products, but also conducive to the expansion of the company to end consumers, enhance consumers’ brand awareness of the company and enhance brand influence, which is of great significance to the company’s brand construction and the extension of high-quality animal protein industry chain.
3. Necessity of selection of securities issued this time
(1) The company’s main business development needs working capital support
During the reporting period, the company was mainly engaged in the cultivation, trade, processing and sales of high-quality seafood, channel operation of beef and mutton and its by-products, and brand food marketing. In 2019, the company completed the acquisition of australisseafoods S.A., increased salmon breeding and processing business, and achieved significant growth in operating revenue and asset scale. In 2019, 2020 and 2021, the company achieved operating revenue of 34277374 million yuan, 4525075 million yuan and 45972182 million yuan respectively. The rapid expansion of the company’s business scale leads to the shortage of existing working capital and the inability to meet the subsequent production demand. Limited capital will make the company unable to continue to expand salmon business and difficult to cope with the increasingly fierce market competition. Therefore, the company needs to reserve working capital to promote the sustainable development of the company’s business.
(2) Optimize the financial structure and reduce the asset liability ratio
In 2017, the company completed the acquisition of 55% equity of Qingdao Guoxing and included it in the scope of consolidated statements. Part of the acquisition funds came from the loan of jiawo group, and Qingdao Guoxing is mainly engaged in aquatic products trade. Under the specific business model of this industry, the overall asset liability ratio is high. In July 2019, the company completed the cash acquisition of australis seafoods S.A., and part of the acquisition funds came from shareholder loans and bank loans. After the completion of the transaction, the total liabilities and asset liability ratio of the listed company increased to a certain extent. As of December 31, 2021, the asset liability ratio according to the consolidated statements of listed companies is 90.72%, which is at a high level. The expansion ability of the company’s business scale is subject to the overall capital and liability status of the company to a certain extent.
Therefore, the company’s replenishment of working capital through the issuance of shares will help to appropriately reduce the asset liability ratio, improve the company’s financial structure, effectively improve the company’s anti risk ability to deal with all kinds of emergencies in the process of operation, and make the company’s business development more stable and healthy.
(3) Seize market opportunities, cultivate advantageous salmon brands in China and promote business growth in China
At present, the company’s sales channels in China are concentrated on tmall, JD mall, HEMA and other platforms, and sells salmon, Arctic sweet shrimp and other products under the brand of “jiawo Xiansheng”. In 2022, the company will vigorously strengthen the expansion of the Chinese market from six dimensions: product, brand, supply chain, business coordination, food material upgrading, food and sales channels. ① In terms of product dimension, through the production of the processing plant in Magellan District, Chile, the product competitive advantage of the region is greatly improved, and the product quality premium is obtained in China by producing the highest quality products in Chile. ② In terms of brand dimension, the company will learn from the successful experience of “jiawo blueberry” and develop the brand operation mode, that is, through the joint operation of local factories, realize the brand promotion and platform construction of “asset light operation + jiawo salmon”, so as to gradually form jiawo’s first brand in the salmon category and break the current situation of salmon with category but without brand. At the same time, the company plans to promote the high-end brand Antarctic song southering from the processing plant in Magellan District, Chile, in China, and increase the brand premium in various channels in China. ③ In the supply chain dimension, chilled salmon needs to be delivered to consumers in the shortest time after slaughtering and processing, so that the products can be better accepted by consumers. The company plans to conduct in-depth cooperation with cross-border logistics strategic partners to establish a seamless route from Chile to China and provide a high-quality and stable supply chain. ④ In the dimension of China business collaboration, the subsidiary Qingdao Guoxing mainly focuses on the processing and distribution of high-quality seafood. It has more than 20 years of industrial operation experience and has accumulated rich upstream resource advantages of seafood. From 2022, the company will increase the synergy between Qingdao Guoxing and salmon business and quickly promote the penetration of salmon market. ⑤ To upgrade the food ingredients to the food dimension, the company actively established a research and development team to complete the strategy of upgrading the food ingredients to food, from the original cut frozen products, prefabricated semi-finished products, and then to salmon instant products, such as salmon fresh pine. ⑥ In terms of sales channels, in 2022, the company will focus on five sales channels to promote business growth in China.
Therefore, in order to cultivate the company’s salmon products in China, build marketing channels and improve the popularity of products in China, the company needs to supplement working capital to promote the growth of business in China.
2、 Appropriateness of the selection scope, quantity and standard of the issuing object
(I) appropriateness of the selection scope of the issuing object
The object of this issuance is jiawo group, which is the controlling shareholder of the company.
The selection scope of this offering object complies with the relevant provisions of laws, regulations, rules and normative documents such as the measures for the administration of securities issuance and registration of companies listed on GEM (for Trial Implementation), and the selection scope is appropriate.
(II) appropriateness of the number of objects of this issuance
The object of this issuance is jiawo group.
The number of objects of this issuance does not exceed 35, which complies with the relevant provisions of laws, regulations, rules and normative documents such as the measures for the administration of securities issuance and registration of companies listed on GEM (for Trial Implementation), and the number of objects of issuance is appropriate.
(III) appropriateness of the selection criteria for the issuing object
The object of this issuance is jiawo group, which is the controlling shareholder of the company. Jiawo group has certain risk identification ability and risk bearing ability, and has corresponding financial strength.
The selection criteria of this offering object comply with the relevant provisions of laws, regulations, rules and normative documents such as the measures for the administration of securities issuance and registration of companies listed on GEM (for Trial Implementation), and the selection criteria of this offering object are appropriate.
3、 Rationality of the pricing principles, basis, methods and procedures of this offering
(I) price and pricing principle of this offering
The pricing benchmark date of this offering is the announcement date of the resolution of the 16th interim meeting of the Fourth Board of directors. The issue price of this issue is 14.80 yuan / share, and the issue price is no less than 80% of the average trading price of the company’s shares 20 trading days before the pricing benchmark date (hereinafter referred to as the “issue base price”).
Two days before the pricing base date
