1、 Guangdong Haid Group Co.,Limited 2023 Annual Report April 2024 Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 1 Section I.Important Notes,Table of Contents and Definitions The board of directors(the Board),the supervisory committee,the directors,the supervisors and the senior m
2、anagement of Guangdong Haid Group Co.,Limited(the Company)hereby warrant the truthfulness,accuracy and completeness of the information presented in this report,guarantee that there are no misrepresentations,misleading statements or material omissions contained in this annual report,and are individua
3、lly and collectively responsible for the authenticity,accuracy and completeness of the information contained in this report.Mr.Hua Xue,head of the Company,and Mr.Shaolin Yang,head in charge of accounting work and head of the accounting department(Accounting Officer),declare that they warrant the tru
4、thfulness,accuracy and completeness of the financial statements in the annual report.All directors were present in person at the Board meeting to consider and approve this annual report.1.Periodical fluctuation risks of feed industry due to abnormal weather changes The feed industry is mainly served
5、 for the downstream animal industry.The abnormal changes including extreme high or low temperature,storm,typhoons et al during the breeding production,and even large-scale outbreaks of diseases which may lead to fluctuations of the inventory of livestock or aquatic products.For example,the continuou
6、s rainfall weather in this year caused the decrease of dissolved oxygen saturation in the water,and the reduced intake of aquatic animals and passively reduced feeding.Some aquatic products can not adapt to the rise of temperature or even die,therefore affecting short-term feed demand and there are
7、adverse effects on the production and operation of feed enterprises.Risk control methods include two aspects:(1)The company is currently fully deploying manufacturers and local markets in major areas in Southern China,Central China,Eastern China and Northern China and overseas markets in Southeast A
8、sia.The expansion of regional distribution can effectively decrease the risk of weather anomalies and natural disasters in local areas.(2)Continuously improving the supports to farmers through the joint empowerment of feed,seedlings,and animal healthcare,providing scientific breeding plans and indiv
9、idual services from companys technical personnel to enhance the risk resistance and competitiveness of farmers and reduce the adverse effects of abnormal weather.Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 2 2.Risks of companys production and operation due to the outbreak of
10、epidemic diseases With the environmental changes and the development of large-scale breeding,animal epidemic diseases also occur from time to time,for instance,African swine fever had broken out across China since August 2018，and PRRSV-mediated pig diseases,shrimp-relevant EMS epidemic diseases and
11、poultry-relevant“H7N9”diseases occurred cross country in recent years.The scale of animal production shrinks because of the outbreak of animal epidemic diseases,following the reduced demand for feed in the short term.The prevalence of major animal diseases can also easily affect consumers purchase i
12、ntention,and then reduce the demand of end-consumers,leading to the downturn of the aquaculture and feed industry,giving rise to adverse effects on the production and operation of feed enterprises.Risk control methods include two aspects:(1)The comprensive feed products cover the feeds of pig,chicke
13、n,duck,goose,fish,shrimp and other livestock and aquatic feeds.The variety of products and the well-balanced structure can effectively mitigate the risk of single species disease with strong comprehensive risk-relieve capability.(2)The company has established the strict epidemic prevention and contr
14、ol system in the production of feed products,utilizing the disease prevention and control from the source with technological advantages and professional capabilities.3.Risk of Drastic Price Fluctuations of major ingredient materials The feed ingredients cover staple agricultural products including c
15、orn and soybeans(soybean meal)et al.In recent years,the domestic and international markets of agricultural product have been closely connected.There were great fluctuations in prices of agricultural products due to the change of the size in the planting area and the harvest amount in these major gra
16、in-producing countries,the purchasing and storage and subsidy policies,the import and export policies,the political conflicts between countries,the international trade relations,the fluctuations in logistics capacity and conditions of shipping and the exchange rates,bringing certain impact on the co
17、st of feed and animal industry.With the strengthening of the international trade of agricultural products,the factors affecting the prices of agricultural products have become more complicated,and the price fluctuations therefore increased.Without fully understanding the changes in the trade of feed
18、 raw materials in time and promptly implement strategic management,the company would face the risk of rising procurement costs.Risk control methods include three aspects:(1)The materials were divided into different categories including centralized purchasing staple category and local Full text of 20
19、23 Annual Report of Guangdong Haid Group Co.,Limited 3 procurement of regional varieties category.It not only guarantees the advantages of large-scale raw material procurement,but also makes best use of localization advantages from rapid response in respect of regional procurement.(2)The raw materia
20、l procurement research system was continuously invested and constructed.The members of team are professional and familiar with raw material information.It can effectively control the procurement risk through real-time tracking,investigating,and judging the market trend in domestic and foreign bulk r
21、aw material,and manage the position risk of bulk raw materials through futures hedging,raw materials trade and other tools.(3)The company has strong research and development(R&D)team with extensive experience in research on animal nutrition and feed formulation.A large amount of fund was invested on
22、 research and development each year,focusing on animal nutrition requirements,feed formulation technology,animal farming and genetic improvement,comprehensive investigation on healthy breeding strategies,and other research areas.The formula can be quickly adjusted to guarantee feed nutrient level an
23、d control the costs in copying with material price fluctuations based on the profound understanding of animal nutritional requirements and the expertise in making best use of raw materials.4.Risk of Environmental Protection Laws and Policies on the Scale and Structural Adjustment in Animal Industry
24、In recent years,our government has introduced a series of environmental protection laws and policies such as the new Environmental Protection Law,the Regulations on Prevention and Control of Pollution from Large-Scale Livestock and Poultry Industry,the Plan for Prevention and Treatment of Contaminat
25、ed Water,the Guiding Opinions on Adjusting the Layout of Pig Production in the Southern Water Network Region et al.These anti-pollution regulations stipulate the pollution prevention in animal industry,and especially limit the production scale in the regions of key water sources and their surroundin
26、g areas.According to the regulations and policies of the central government,the banned areas and restricted areas have been highlighted throughout the country,and pig farms in prohibited areas are gradually relocated in the southern water-network area.The implementation of environmental protection p
27、olicies not only further speeds up the withdrawal of individual pig farms to reduce the backward production model with unqualified environmental protection,but also expand the production capacity of large-scale farm with better breeding structure.In addition,the establishment of banned areas and res
28、tricted areas will enforce the adjustments of pig production capacity across the country.The adjustments of the scale composition of pig production and the relocation of pig production area will certainly have a profound impact on the existing capacity layout,market share,pricing,and business model
29、of feed industry.The impact of environmental protection policies on the pig industry and feed industry induces Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 4 existing competitive enterprises at the risk of reshuffling.Risk control measures included four aspects:(1)The company
30、continually improves its service capability to farmers.In addition to feed products,the company is also engaged in the industrial fields of animal healthcare,vaccines,and finance,and connects closely with large-scale farmers.(2)The feed products of the company cover the field of livestock,poultry,an
31、d aquatic animals with abundant product lines.The producing lines for pig feed,chicken feed,duck feed and pelleted fish feed can be shared and switched.The company can rapidly shift the production layout according to the changes in the market through adjusting the production capacity in the manufact
32、urers.(3)The company adopts multiple models to speed up the production layout in areas with abundant resources and permitted environment,and to obtain more market share in new animal farming areas.(4)The company continues to increase R&D investment,and the key technologies on microbial fermented fee
33、d and antibiotic alternatives have been effectively applied to foster the progress and development of the industry.5.Risk of Exchange Rate Fluctuations The global procurement of feed raw materials has become the norm.The scale of overseas investment and operations of the company is also rapidly expa
34、nded.The scale of cross-border fund settlement and the stock of overseas assets have grown substantially,involved in various currency types of different countries.The currency exchange rate fluctuations are subject to different influence factors.The exchange rate fluctuations in any currency put cer
35、tain impact on the settlement cost and asset value of the regions.Risk control methods include two aspects:(1)the company strictly controls the exchange rate risks,carefully selects settlement currencies to achieve relatively balanced regional fund inflow and outflow through structural arrangements
36、of financing sources and financing types according to the scale,the model,and settlement characteristics of business in different regions and countries.(2)The expansion of two-way fluctuations in RMB exchange rate has become the new norm.The company increases its awareness of foreign exchange risk a
37、nd arranges settlement models according to the procurement and sales strategies and the cycle characteristics of import and export operations,and flexibly used financial instruments such as forward foreign exchange settlement and sale,swaps,foreign exchange options and others to lock in exchange rat
38、e,control procurement and sales costs and the possible risks caused by exchange rate fluctuations.The statements involving the Companys future plans in this report do not constitute substantial commitment of the Company to any investors or related Full text of 2023 Annual Report of Guangdong Haid Gr
39、oup Co.,Limited 5 parties.Investors are kindly advised to aware investment risks.The proposed profit distribution plan of the Company was considered and passed by the Board:on the basis of the total number of shares on the date of record minus the repurchased shares when the plan is implemented in t
40、he future,the Company will distribute cash dividend of RMB 5.00(tax inclusive)and 0 bonus share(tax inclusive)for every 10 existing shares held by all shareholders without capitalization of capital reserve.In this report,certain total numbers may not be exactly equal to the summation of their sub-it
41、em numbers as a result of roundoff.This report has been prepared in both Chinese and English.Should there be any discrepancies or misunderstandings between the two versions,the Chinese version shall prevail.The complete published Chinese 2023 Annual Report is available at the media designated for in
42、formation disclosure.Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 6 Table of Contents Section I.Important Notes,Table of Contents and Definitions.1 Section II.Company Profile and Key Financial Indicators.9 Section III.Management Discussion and Analysis.15 Section IV.Corporate
43、Governance.52 Section V.Environmental and Social Responsibility.88 Section VI.Material Matters.94 Section VII.Share Changes and Shareholder Information.118 Section VIII.Preferred Shares.127 Section IX.Bonds.128 Section X.Financial Statements.129 Full text of 2023 Annual Report of Guangdong Haid Grou
44、p Co.,Limited 7 Documents Available for Reference 1.The financial statements signed and sealed by the head of the Company,the head in charge of accounting work and the head of the accounting department(Accounting Officer).2.The original copy of the Independent Auditors Report signed and sealed by th
45、e CPAs,as well as sealed by the CPA firm.3.The originals of all the Companys announcements and documents which were disclosed during the Reporting Period.4.The annual report disclosed on other securities markets.Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 8 Definitions Item D
46、efinition Company,Group,Haid Group Guangdong Haid Group Co.,Limited Board the board of directors of Guangdong Haid Group Co.,Limited Supervisory Committee the supervisory committee of Guangdong Haid Group Co.,Limited General Meeting of Shareholders the general meeting of shareholders of Guangdong Ha
47、id Group Co.,Limited Company Law the Company Law of the Peoples Republic of China Securities Law the Securities Law of the Peoples Republic of China Articles of Association the Articles of Association of Guangdong Haid Group Co.,Limited RMB Renminbi reporting period,the period,the year the period fr
48、om 1 January 2023 to 31 December 2023 last year,the same period of last year the period from 1 January 2022 to 31 December 2022 the end of the period 31 December 2023 the beginning of the period or the year 1 January 2023 CSRC China Securities Regulatory Commission Full text of 2023 Annual Report of
49、 Guangdong Haid Group Co.,Limited 9 Section II.Company Profile and Key Financial Indicators I.Company profile Stock name Haid Group Stock code 002311 Previous stock name(if any)N/A Stock exchanges on which the shares are listed Shenzhen Stock Exchange Chinese name of the Company 廣東海大集團股份有限公司 Chinese
50、 abbreviation of the Company 海大集團 English name of the Company(if any)Guangdong Haid Group Co.,Limited English abbreviation of the Company(If any)HAID GROUP Legal representative of the Company Hua Xue Registered address Room 701,Building 2,Haid Mansion,No.42,Road 4,Wangbo,Nancun Town,Panyu Dist,Guang
51、zhou,China Postal code of registered address 511445 Past changes of registered address The registered address remained unchanged during the reporting period.Office address Room 701,Building 2,Haid Mansion,No.42,Road 4,Wangbo,Nancun Town,Panyu Dist,Guangzhou,China Postal code of office address 511445
52、 Website of the Company Email address II.Contact persons and contact methods Board Secretary Securities Affairs Representative Name Zhijian Huang Jiewen Lu and Huafang Yang Correspondence address Room 701,Building 2,Haid Mansion,No.42,Road 4,Wangbo,Nancun Town,Panyu Dist,Guangzhou,China Room 701,Bui
53、lding 2,Haid Mansion,No.42,Road 4,Wangbo,Nancun Town,Panyu Dist,Guangzhou,China Telephone 8620-39388960 8620-39388960 Facsimile 8620-39388958 8620-39388958 Email address III.Information disclosure and places for inspection Stock exchange website where the Annual Report is disclosed Securities Times,
54、China Securities Journal,Securities Daily,Shanghai Securities News Media and website where the Annual Report is disclosed Places for inspection of the Companys Annual Report Securities Department of the Company Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 10 IV.Change in regis
55、tration Unified social credit code No change Change of principal activities since its listing(if any)No change Change of the controlling shareholder(if any)No change V.Other relevant information CPA firm engaged by the Company Name of the CPA firm Grant Thornton China(Special General Partnership)CPA
56、 firms address 5th Floor,Scitech Palace 22 Jianguomen Wai Avenue,Chaoyang District,Beijing Name of the signing certified public accountants Wenyuan Guan and Shuntong Qiu Sponsors engaged by the Company to continuously perform its supervisory function during the reporting period Applicable Not applic
57、able Name Office address Representative Period of supervision GF Securities Co.,Ltd.GF Securities Tower,26 Machang Road,Tianhe District,Guangzhou Jian Liu and Yuqing Zhang The period of supervision for the raised funds is from July 2022 to December 2023.Financial Advisors engaged by the Company to c
58、ontinuously perform its supervisory function during the reporting period Applicable Not applicable VI.Major accounting data and financial indicators Retrospective adjustment to or restatement of the accounting data for prior years by the Company Yes No Reasons for retrospective adjustment or restate
59、ment Change of accounting policy 2023 2022 Increase/decrease for the year as compared to the prior year 2021 Before Restated Restated Before Restated Operating income(RMB)116,117,168,742.97 104,715,417,485.92 104,715,417,485.92 10.89%86,091,961,539.13 86,091,961,539.13 Net profit for the year attrib
60、utable to shareholders of the parent company(RMB)2,741,256,374.98 2,954,142,403.34 2,957,330,734.56-7.31%1,636,237,735.85 1,640,681,925.34 Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 11 2023 2022 Increase/decrease for the year as compared to the prior year 2021 Before Restate
61、d Restated Before Restated Net profit for the year attributable to shareholders of the parent company after deducting the non-recurring gain or loss(RMB)2,541,491,959.42 2,880,122,890.31 2,883,311,221.53-11.86%1,559,604,300.76 1,564,048,490.25 Net cash flows from operating activities(RMB)12,698,374,
62、699.54 6,817,894,250.91 6,817,894,250.91 86.25%3,137,948,250.69 3,137,948,250.69 Basic earnings per share(RMB per share)1.66 1.79 1.79-7.26%0.98 0.99 Diluted earnings per share(RMB per share)1.66 1.79 1.79-7.26%0.98 0.98 Rate of return on equity on weighted average basis 14.53%18.46%18.47%-3.94%11.7
63、4%11.77%As at the end of 2023 As at the end of 2022 Increase/decrease as at the end of the year compared to the end of the prior year As at the end of 2021 Before Restated Restated Before Restated Total assets(RMB)44,746,735,775.61 44,237,781,732.31 44,470,388,435.88 0.62%35,695,097,401.96 35,901,36
64、3,324.60 Total equity attributable to shareholders of the parent company(RMB)19,647,107,064.19 17,824,906,815.87 17,832,539,336.58 10.18%14,501,327,072.09 14,505,771,261.58 Reasons for change of accounting policy and correction of accounting error In November 2022,the Ministry of Finance issued the
65、Interpretation No.16 for the Accounting Standards for Business Enterprises(企業會計準則解釋第 16 號)(CK 2022 No.31)(hereinafter referred to as“Interpretation No.16”).For a single transaction that is not a business combination and does not affect either accounting profit or taxable income(or deductible losses)
66、at the time the transaction occurs,and where the initial recognition of assets and liabilities results in an equal amount of taxable temporary differences and deductible temporary differences,deferred income tax liabilities and deferred income tax assets shall be recognised respectively on the afore
67、said taxable temporary differences and deductible temporary differences arising from the Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 12 initial recognition of assets and liabilities at the time the transaction occurs in accordance with the applicable regulations such as the A
68、ccounting Standard No.18 for Business Enterprises-Income Tax(企業會計準則第18 號-所得稅).For such transactions that occurred between the beginning of the earliest period in the financial statement presentation where the above provisions were first applied and the date of application of the said interpretation,
69、enterprises should adjust the cumulative effect to the opening retained earnings and other relevant financial statement items in the earliest period in the financial statement presentation in accordance with the above provisions.The above accounting treatment is effective from 1 January 2023 onwards
70、.The Company has made adjustments in accordance with Interpretation No.16 for taxable temporary differences and deductible temporary differences arising from lease liabilities and right-of-use assets recognised in respect of leasing operations.For details,see“III.39.Changes in significant accounting
71、 policies and accounting estimates”in“Section X.Financial Statements”.Whether the lower of the net profit for the year attributable to shareholders of the parent company before and after deducting the non-recurring gain or loss was negative for the last three accounting years,and the latest independ
72、ent auditors report indicated that there was uncertainty about the Companys ability to continue as a going concern Yes No Whether the lower of the net profit for the year attributable to shareholders of the parent company before and after deducting the non-recurring gain or loss was negative Yes No
73、VII.Differences in accounting data under domestic and overseas accounting standards 1.Differences between the net profit and net assets disclosed in accordance with international accounting standards and China accounting standards in the financial report Applicable Not applicable There was no differ
74、ence between the net profit and net assets disclosed in accordance with international accounting standards and China accounting standards in the financial report during the reporting period.2.Differences between the net profit and net assets disclosed in accordance with overseas accounting standards
75、 and China accounting standards in the financial report Applicable Not applicable There was no difference between the net profit and net assets disclosed in accordance with overseas accounting standards and China accounting standards in the financial report during the reporting period.VIII.Key Finan
76、cial Indicators by Quarter Unit:RMB Q1 Q2 Q3 Q4 Operating income 23,358,349,660.13 29,378,302,285.67 34,189,718,845.92 29,190,797,951.25 Net profit for the year attributable to shareholders of the parent company 407,909,413.30 692,271,146.93 1,151,392,636.93 489,683,177.82 Net profit for the year at
77、tributable to shareholders of the parent company after deducting the non-recurring gain or loss 389,199,275.36 692,186,171.73 1,102,720,936.48 357,385,575.85 Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 13 Net cash flows from operating activities 200,675,996.60 5,345,763,833.8
78、1 3,752,430,438.30 3,399,504,430.83 Whether the above indicators or their aggregated amounts have any material difference with the respective amounts as disclosed in the quarterly report or interim report Yes No IX.Items and Amounts of Non-recurring Gains or Losses Applicable Not applicable Unit:RMB
79、 Item Amount for 2023 Amount for 2022 Amount for 2021 Explanation Gain or loss on disposal of non-current assets 9,004,677.06-45,840,354.94-21,381,178.37 Government grants recorded in current profit or loss(excluding government grants that are closely related to the Companys ordinary activities and
80、given in accordance with defined criteria and in compliance with government policies,and have a continuing impact on the Companys profit or loss)59,119,428.77 125,600,697.83 91,417,497.06 Except for the effective hedging activities related to the Companys ordinary activities,profit or loss arising f
81、rom changes in fair value of financial assets and liabilities held by a non-financial enterprise,as well as from disposal of financial assets and liabilities 147,165,591.84 39,455,335.15 0.00 Profits or losses from external entrusted loans 326,833.38 530,942.74 0.00 Reversal of provision for bad and
82、 doubtful debt where accounts receivable are individually tested for impairment 14,802,077.94 6,167,665.26 11,769,732.86 Investment costs for acquisition of subsidiaries,associates and joint venture less than gains from the fair value of identifiable net assets of the investees 812,610.97 40,510.51
83、Other non-operating incomes and expenses,except for the above-8,642,137.95-34,643,762.69 12,478,800.92 Other gain or loss satisfied the definition of non-recurring gain or loss 5,936,636.84 3,713,581.31 Less:impact of Income tax 9,966,547.74 17,625,340.80 15,798,527.34 Less:impact of non-controlling
84、 interests(net of tax)12,045,507.74 6,374,917.33 5,606,981.86 Total 199,764,415.56 74,019,513.03 76,633,435.09-Particulars about other gain or loss that satisfied the definition of non-recurring gain or loss Applicable Not applicable The Company had no other gain or loss that satisfied the definitio
85、n of non-recurring gain or loss.Notes for the Companys non-recurring gain or loss items as illustrated in the Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1-Non-recurring Gain or Loss(公開發行證券的公司信息披露解釋性公告第 1 號非經常性損益)defined as its recurrin
86、g gain or Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 14 loss items Applicable Not applicable No non-recurring gain or loss items as illustrated in the Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1-Non-recurring
87、Gain or Loss(公開發行證券的公司信息披露解釋性公告第 1 號非經常性損益)were defined by the Company as its recurring gain or loss items during the reporting period.Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 15 Section III Discussion and Analysis of Management I.Industry Situation during the reporting pe
88、riod 1.Basic situation and the development stage of the industry Animal husbandry,fishery and feed industries are all important industries related to the national economy and peoples livelihood,and play a key role in ensuring national food security and promoting farmers income.The high-quality devel
89、opment of animal husbandry and fishery has provided strong support for comprehensively promoting rural revitalization and accelerating the modernization of agriculture and rural areas.As the core of animal husbandry and fishery,the breeding industry is accelerated by the development trend of large-s
90、cale,intensive and intelligent breeding,the agglomeration effect of technology,talents and other factor resources is further highlighted.The development and quality of the industry conform to the accelerated upgrading of the consumption structure of urban and rural residents,so as to meet the increa
91、sing demand of residents on high-quality and safe food and beautiful ecological environment.The feed industry is an important link in the production system of animal husbandry,fishery and aquaculture,as the basis for ensuring the efficient supply and quality of livestock and poultry products and aqu
92、atic products.The feed industry has gradually transformed into the stage of high-quality development from the one-dimensional competition of feed products itself to the multi-dimensional competition of seedlings,animal healthcare,feed product quality and enterprises breeding technology service capab
93、ilities.The competitiveness of enterprises in the feed industry is seriously differentiated,the integration of the industry continues to accelerate,and the development of the industry is gradually concentrated in advanced enterprises which adhere to scientific and technological innovation and streng
94、then technical services.2.The situation of the industry in 2023 The consumption base has been consolidated,the demand of consumers has been stabilized,the breeding inventory was a bit of high,and the feed industry continued to grow during 2023.The poultry breeding inventory gradually increased to a
95、normal level,driving the demand for poultry feed to continue to recover.The number of pigs had been high throughout the year 2023,forming the strong demand for pig feed.In aquaculture,the annual price of common fish had been below the cost line,farmers confidence and feeding enthusiasm are greatly a
96、ffected,and the demand for regular feed products had been suppressed significantly,but the demand for shrimp and special aquatic feed had been stable.There are more details as followings,1.Bulk agricultural products price shad showed from high level to gradual decline affected by the international s
97、ituation and supply and demand pattern,and the prices fluctuated violently throughout the year.During the year,the price of corn fell and then rose from the beginning of the year,and then broke through 2,900 yuan/mt at the high point,and then the price fell and gradually accelerated falling to 2,600
98、 yuan/mt at the end of the year.The price of soybean meal fell from 4,500 yuan/mt at the beginning of the year,and then fluctuated and rose in the second and third quarters to the high point of 5,000 yuan/mt,it fell down to about 3,500 yuan/mt in the fourth quarter.Fishmeal price was accelerated fro
99、m 12,000 yuan/ton in the second and third quarters,breaking through the record high of 18,000 yuan/ton because of the sharp reduction in Peruvian fishing volume and the decline in fishmeal stocks,and then gradually fell back to the price of the beginning of the year at the fourth quarter.2.In terms
100、of breeding industry:(1)The operating cash flow of the poultry breeding industry continues to recover,with the increase in poultry seedling production capacity at the beginning of the year,the increase in supply,and the enhancement of demand and logistics certainty,the poultry breeding inventory had
101、 gradually risen to the normal level.In addition,the consumption demand for egg products had been stable,the consumption scenarios had been abundant,the egg price was basically above the cost line,and the breeding profit had been considerable.(2)The number of live pigs is high throughout the year.Ac
102、cording to the National Bureau of Statistics,in 2023,726.62 million pigs had been slaughtered nationwide,an increase of 3.8%.Pork output was 57.94 million tons,an increase of 4.6%.Pig prices had been low level for a long time,and the breeding had been comprehensive loss under the structure of oversu
103、pply.(3)In aquaculture,due to the normalized operation of the catering industry,Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 16 most species such as shrimp and crabs,special fish et al highly dependent on catering consumption,are operating normally,however,some species such as
104、 raw fish and California perch,due to the continuous substantial growth of aquaculture in the past few years,short-term oversupply,slow inventory depletion,and low prices throughout the year,the price of common fish were below the cost line throughout the year,and the confidence and enthusiasm of fa
105、rmers were greatly affected.3.The feed industry as a whole kept continuously growing.Affected by the breeding industry,the feed industry has continued to grow in livestock and poultry feed,and aquatic feed has declined.According to data disclosed by the China Feed Industry Association,the total outp
106、ut of industrial feed in the country in 2023 will be 321.627 million tons,a year-on-year increase of 6.6%.In terms of varieties,the output of pig feed was 149.752 million tons,an increase of 10.1%;the output of poultry feed was 127.852 million tons,an increase of 5.4%;the output of aquatic feed was
107、23.444 million tons,a decreased by 4.9%;the output of ruminant feed was 16.715 million tons,an increase of 3.4%.II.Main businesses of the company during the reporting period The company laid out the industrial chain with the aim of providing overall services to animal farming.It has formed a relativ
108、ely complete aquatic product industrial chain,and the livestock and poultry industrial chain has also gradually been constructed.The main products include high-quality animal seedlings,feed,animal healthcare,pig breeding and aquatic products.The business operation has covered all business links such
109、 as R&D,designing,producing,sales and service of various products.Specifically,the companys products include feeds for chickens,ducks,geese,pigs,fish,shrimps,crabs and ruminants,breeding varieties such as pigs,shrimps,fish fry and chickens,fresh livestock and poultry products and aquatic pre-made pr
110、oducts as well as biological products,veterinary medicine,vaccines,and other healthcare products required for producing livestock,poultry,and aquaculture.1.Main business and products （1）The business of feed,seedling and animal healthcare were interacted to form Gold Tringle Feed,seedling and animal
111、healthcare business are core parts of the company.After more than 20 years of development,Feed business has accumulated a wide range of customer resources.Through providing customers with high-quality valuable seedlings and cost-effective feed products in the market,relying on breeding services to d
112、rive the development of vaccines,veterinary medicines,biological products and other animal healthcare products,the company can better support customers to achieve breeding success through the full set of services,and help customers realize that healthy farming at the same time,resulting in better co
113、ntrolling the breeding cost and obtaining the competitive advantage in respect of end products.(2)On the basis of specialization,the breeding industry realizes the asset-light and low-risk breeding model Based on the healthy development of feed,seedling and animal healthcare business,the company has
114、 explored the model of breedings.In terms of livestock and poultry,the company mainly focuses on pig breeding with continuous improving professional breeding capabilities,continuously optimizating breeding costs and controllable risks.In terms of aquaculture,the company has started industrial shrimp
115、 farming that the company has overall advantages using its own high-quality seedlings,feed and animal protection products.In the breeding business,the company controls the scale of breeding,builds team,reduces costs,improves the system,and builds its core competitiveness.2.Major business model (1)Fe
116、eds,seedlings and animal healthcare products business Feed business is core business of company,the business management is mainly carried out with the model of centralized procurement of raw materials,distribution of production layout,sales of products accompanied with technical services.1)The adopt
117、ion of the centralized procurement model composed of group plus regional center is combined with hedging and other methods for agricultural products and other bulk raw materials to achieve better procurement cost advantages and risk control;2)Due to the production being closer to the market,convenie
118、nt in logistics and rich in resources,the company currently has feed factories distributed in 200 cities of Asia,Africa and South America.3)The distribution together with direct sales is the companys main sales model.Focusing on localized marketing,the company has fully established distribution chan
119、nels to efficiently solve farmers capital and transportation needs.Through service stations established in main production areas,the Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 17 technical service teams directly visit farmers to provide professional services for farming and
120、have achieved functional complementation and collaboration with sales organization and management teams in terms of sales and service as well as channel and farmers.4)High-quality animal seedlings,biological Products,veterinary drugs and vaccines become indispensable and constitute a package of inte
121、grated products and tools to provide services for farmers.(2)Animal breeding business mode The companys pig farming segment adopts both the self-breeding plus farming community model and company plus family farm model.The self-breeding plus farming community model means that seedlings are introduced
122、 and bred to create a farming system of grandparent-parent-commercial pig,under which reproduction is separated from breeding to ensure that the farming process is safe and controllable.The company plus family farms model means that the company provides family farmers with products for farming inclu
123、ding seedlings,feeds,and vaccines,and provides major technical supports for farming,in turn the farmers are responsible for animal raising and transfer the end-products back to the company for sales.The aquatic animal farming and processing business has just started,and the primary aquatic products
124、are fishes,prawns and other specialty products.With its strengths in high-quality seedlings,feeds,animal healthcare and technical advantages,the company carries out standardized and industrialized aquaculture,supplying sustainable,healthy,traceable aquatic products(processed products)to large cateri
125、ng enterprises and fresh food platforms.III.Analysis of Core Competitiveness The products and services are centered on the needs of the animal production industry.Its core competitiveness is represented by the capability of creating values for customers while carrying out the mission of changing rur
126、al China.The comprehensive performance includes the rich and complete product configuration and industrial chain layout,outstanding single product power,leading R&D ability,comprehensive aquaculture technology service ability,comprehensive product combination organizing ability and perfect talent tr
127、aining and incentive growth system during the process of promoting rural revitalization.1.Distinct and excellent product power is the most important competitive advantage of the company All series of products of the company are committed to building product power significantly ahead of competitors a
128、nd put great efforts to strengthen the explicit expression of product power.High-quality products with high pricing have obvious advantages of ultimately better animal survival rate,growth effect and growth efficiency,and the brand effect is prominent.Based on then leading production efficiency,the
129、pricing of mid-quality products is close to the pricing of competitors products,pursuing outstanding product cost performance.With the support of farmers,the overall benefits of the company are significantly higher than those of similar products.In the case of the declining aquaculture benefits，the
130、whole industry is at a loss,however,our customers only loss less or even no loss.The embodiment of product power needs the support of professional abilities within the company including the R&D ability of animal nutrition and raw material utilization,the formula technology ability of products,the va
131、lue procurement ability of raw materials,efficient internal operation ability and other professional abilities indispensable,for example,the support of value purchasing capacity.The companys procurement team has outstanding professional capacity.The team is young and specialized.The division of labo
132、r is carried out according to the classification of raw materials.The industry perspective is broad,and the amount of information collection and analysis is large.It can track,study and judge the market trend of large raw materials at home and abroad in real-time,and use futures tools to hedge bulk
133、raw materials,and effectively control the price risk and financial risk of procurement.The team finds out many purchasing opportunities of raw materials with their outstanding purchasing capacity,making the cost advantage of feed products and raw material trade possible.The company is the first ente
134、rprise in the industry to successfully set up centralized procurement,with obvious advantages in scale procurement.Due to its rich experience in the application of spot,futures,options and other procurement tools,the application method is also relatively flexible.Long term value procurement and risk
135、 position management are also conducive to the companys acquisition of procurement cost advantages and risk control.Another part is the companys efficient operation ability.By promoting the implementation of management software such as SAP,EPS and business sharing system,the company has a strong inf
136、ormation system,and its internal operation is process oriented,standardized and data based.The function of digitization is to find out Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 18 efficient and energy-saving operation methods by comparing the big data of each subsidiary com
137、pany.The function of process and standardization is to greatly improve the internal replicability.The middle office management mechanism enables the production,R&D,procurement and manpower to respond to the market quickly and match the needs of the market and customers in a more flexible,fast and ef
138、ficient way.Efficient operation capability has become an important support for effectively organizing the professional production of various products.2.Technology R&D is the professional support of product creation,the foundation and driving force of the companys development,and the core advantage o
139、f the company At the beginning of its establishment,the company established the research center to build an industry-leading R&D system of the whole industry chain including breeding,nutrition,healthcare,farming and others.With the increasing of investment in application technology,the company has f
140、ocused on strengthening the technical platform construction of each business module in the industrial chain,forming a three-level R&D system from platform technology research to application technology development to systematic solution application.The company promotes the rapid transformation and ap
141、plication demonstration of scientific and technological achievements through the effective connection of the three-level R&D system and the operation mechanism of Research Institute plus subsidiary company.The company carries out research on basic,forward-looking and general key problems in seven R&
142、D directions:animal genetics and breeding,animal nutrition and feed,animal medicine and biopharmaceutical,microbial engineering,biochemical industry,protein engineering and healthy breeding,constantly improves the three-level R&D system,and comprehensively and effectively supports,drives and serves
143、the needs of the rapid development of the whole industrial chain of the group.The company has rich technical research reserves,has the R&D team of more than 3500 people,and put huge investment in R&D every year.The R&D personnel include talents from animal nutrition,veterinary,breeding,breeding mode
144、,bioengineering,biochemistry,machinery and other disciplines.The transformation speed of R&D results is fast,the investment supporting strategy can be implemented clearly and quickly,and the product allocation ability of the company is strong.In terms of feed formula technology,through more than 20
145、years of continuous research and development,the company has established a huge animal nutrition demand database and stored a variety of raw material formula technology,thousands of groups of comparative experimental results are added to the animal core nutrition demand and raw material utilization
146、database every year,to transform the technology into productivity.Therefore,the company has strong ability to organize and continuously optimize the product formula and strong adaptability.It can quickly adjust the formula when the price of raw materials fluctuates,so as to obtain cost competitive a
147、dvantage.At the same time,through scientific and technological research and development to drive product optimization and upgrading,it can not only comply with the changes in the breeding environment and the changes in the breeding mode,but also lead the progress of breeding technology and the upgra
148、ding of the breeding model.3.The breeding technology service system is an important tool for the company to create value for customers,continuously obtain new customers and improve customer viscosity In 2006,the company took the lead in providing comprehensive technical services to farmers in the in
149、dustry and established the company as a service-oriented enterprise and an enterprise providing overall breeding services to farmers.The company provides farmers with products and technical service support in the whole breeding process,such as seedling stocking mode-environmental control-epidemic pr
150、evention and control-feed-market information-financial support,to ensure that farmers can use the most advanced breeding technology to guarantee the success and profitability of farmers.The company has more than 10,000 experienced and passionate technical service teams in the industry;And accumulate
151、 a variety of advanced breeding modes in combination with local characteristics;There are hundreds of highly efficient service stations in intensive breeding areas across the country,which can provide technical services for tens of thousands of farmers at the same time.The companys relatively comple
152、te service system in the industry can give full play to the advantages of product power and provide the whole process technical service of breeding,which can effectively enlarge the income of customers and increase the loyalty of customers.The companys farming technical service started from aquacult
153、ure service.After more than ten years of talent team and platform construction,the process and concept of aquaculture technical service system have penetrated into all links of products,technology,R&D,market and operation,driving the development of the companys aquatic feed and animal protection bus
154、iness,highlighting the effect.And the process and protocols had been gradually promoted to pig breeding and had achieved obvious results.The comprehensive breeding technology service has become an important brand label of the company and an important starting point for the company to Full text of 20
155、23 Annual Report of Guangdong Haid Group Co.,Limited 19 create value for customers,obtain and keep customers.4.Resourseful and complete product portfolio configuration ability,and strong risk control ability In the breeding chain,after years of technical investment,transformation of research and dev
156、elopment achievements,product accumulation and production layout,the companys product configuration has reached relatively rich and complete state from feed,functional feed,seedlings,medicines,vaccines and biological products,covering the whole process of breeding needs,and still under development.I
157、n terms of feed products,the company is one of few domestic enterpries which can simultaneously produce and sale fish,shrimp,pigs,meat and poultry,eggs and poultry,ruminant feed with complete product lines,and all categories of products have strong competitiveness,and have a high market share in the
158、 key market.The company had rich and complete product configuration and industrial chain layout gradually pushing to the international market,fully taking advantages of the industrial chain and exploring overseas growth.The product configuration capabilities require strong customer demand insight,R&
159、D organization,achievement transformation,production base investment and construction,processing organization,marketing promotion and technical service capabilities.The technical requirements of various feed varieties are different,the gross profit margins are different,the market characteristics an
160、d operational risks are also different,so the product structure portfolio enables the company to obtain a gross profit margin higher than the general level of the industry,and better control the market operation risk caused owing to animal disease and supply and demand imbalance,so that the companys
161、 feed product sales revenue is stable and maintains rapid growth rate much higher than the industry growth rate.5.The perfect talent training system and effective incentive mechanism have laid the foundation for the sustainable and stable development of the company The company continues to promote t
162、he establishment of an organizational atmosphere for talent training.Through Haida college and the human resources center,the company has built a three-way training system covering the whole career of employees,the whole business of the company and the whole post of business,built the learning ecosy
163、stem combining universal education and elite training,matched with standardized skill training at all levels,and realized a standardized rapid endogenous talent training and output mechanism.With the continuous development of the companys business and the deep extension of the industrial layout,a nu
164、mber of young,enthusiastic,energetic young cadres with new ideas and new era labels have become the mainstay of the companys middle-level management and core technical backbone.Through the establishment of school enterprise cooperation and the integration of industry and education,the company attrac
165、ts a large number of excellent college students to join the company every year,and establishes a reserve talent team to support the sustainable development of the company.Through initiating the establishment of China Modern Fishery Vocational Education Group and the establishment of Rural Revitaliza
166、tion college,a large number of new farmers are attracted to participate in the construction of technical and industrial talents.The establishment of internal and external talent system has realized the talent system pattern of internal talent training and external industry empowerment and driven the
167、 overall progress of the industry.Since its listing,the company has launched multi-stage equity incentive plan and employee stock ownership plan for core managers and technical members at different levels,established a unified incentive mechanism of long-term and short-term incentives and constraint
168、s consistent with the interests of all shareholders,and ensured the implementation of the companys development strategy and business objectives by setting performance objectives and incentives,ensuring the sustainable and stable development of the company.IV.Main business analysis 1.Overview During
169、the reporting period,the company achieved income of 116.117 billion yuan,a year-on-year increase of 10.89%,and the net profit attributable to shareholders of listed companies was 2.741 billion yuan,a year-on-year decrease of 7.31%,due to the loss of the breeding business(the breeding business achiev
170、ed good profitability in the same period of 2022).In the breeding business,the companys pig and raw fish breeding achieved a total income of about 10.7 billion yuan,and a net profit loss attributable to shareholders of listed companies more than 400 million yuan,of which the loss of raw fish exceede
171、d 300 million yuan.I.Deeply cultivate the main business of feed,seedlings and animal healthcare,and achieve higher goals with stable and sustainable growth Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 20 1.Seize the opportunity,keep double-digit growth in feed sales and furthe
172、r improve the profitability The company has completed the strategic layout of 40 million tons of feed production capacity,and the companys core business objective during the reporting period made full use of the product competitiveness,research and development capabilities,technical service system a
173、nd many other competitive advantages to improve the companys capacity utilization rate and market share.Because the production capacity layout has been completed,as long as the sales scale continues to increase,the capacity utilization rate can further expand the companys scale benefits,and strength
174、en the original professional advantages,so as to reduce the breeding cost of farmers and improve the companys operating efficiency.During the reporting period,the company achieved feed sales of 24.4 million tons(including 1.8 million tons of internal aquaculture consumption),a year-on-year increase
175、of 13%,and external feed sales of 22.6 million tons,an increase of 2.36 million tons year-on-year,and further increased its market share:1)the external sales of aquatic feed were 5.24 million tons,a year-on-year increase of 2%,and the product structure was significantly optimized:among them,the sale
176、s volume of special feed(high-grade puffed fish feed and shrimp and crab feed)increased by 13%year-on-year.In the second half of the year,the company quickly adjusted its sales strategy,invested resources in key markets,and vigorously supported high-quality customers and farmers,and the sales of gen
177、eral feed gradually improved,and it has turned into positive growth in the first quarter of 2024.Owing to the optimization of the structure of aquatic feed products(the proportion of special feed has been greatly increased)and the continuous transformation of technical advantages,the profitability o
178、f aquatic feed has been greatly improved.2)Poultry feed sales reached 11.3 million tons,up 13%year-on-year.The poultry industry chain as a whole has steadily rebounded from the bottom of the loss for nearly three consecutive years,and the breeding inventory has risen to a normal level,the company ha
179、s fully taken the comprehensive advantages of technology,procurement,and operation of various varieties,and established in-depth cooperation with large-scale breeding plants and one-stop breeding companies through diversified forms of cooperation,so as to accelerate the integration of upstream and d
180、ownstream professional capabilities in the industrial chain,and effectively improve the utilization rate,sales volume and profitability of poultry feed.3)Pig feed sales reached 5.79 million tons,a year-on-year increase of 17%.The companys pig feed relies on continuous investment in research and deve
181、lopment to show good competitiveness,and at the same time began to build a service team and system.The sales and service cooperation model with family farms and large-scale farms with breeding advantages becomes more and more mature,and the product power and brand power are gradually improving.4)The
182、 companys ruminant material has been steadily promoted in accordance with the strategic plan,and the production capacity layout and market expansion have been implemented in an orderly manner,and the sales volume in 2023 had increased by 70%year-on-year.2.The seedling and animal healthcare business
183、develop synchronously,and the product force of the feed is superimposed The companys seedling business and feed products are developed in tandem to form a superposition of product strength.During the reporting period,the companys seedling business achieved income of about 1.3 billion yuan,of which t
184、he income of shrimp seedlings increased by about 29%.The number of new national aquatic varieties owned by the company has increased to 6,including Haixingnong No.2,Haixingnong No.3,Huahai No.1,Huahai No.1,Changzhu hybrid mandarin fish and hybrid snakehead Xiongyu No.1.In terms of shrimp breeding,th
185、e company has 14 generations of pedigree,more than 2,000 families are preserved every year,constituting a germplasm resource bank with high genetic diversity,and has 8 specialized shrimp breeding centers,multiplication and testing bases to ensure the strong competitiveness of the companys shrimp see
186、dling products.The company continues to invest in the fish fry industry,breaking through the traditional breeding mode and introducing indoor factory breeding.The tilapia varieties have made great breakthroughs in breeding,multiplication and farming,and it is expected that industrial advantages will
187、 be rapidly formed in the next few years.In the grass carp,bream,crucian carp and other traditional varieties to bring forth the new varieties,in the raw fish,yellow catfish and other varieties to take the lead in the realization of the scale of parthenogenesis.In addition,the company has invested i
188、n the construction of aquatic seed farms in Vietnam,Indonesia and other countries,initiating an international strategic layout.In the field of animal healthcare,the company relies on strong R&D capabilities to achieve product innovation and upgrading in line with market demand.At the same time,the c
189、ompany strengthens the integrated development strategy of feed and animal healthcare,develops a variety of functional feeds with good quality and meets the needs of breeding,solves the difficult parts of breeding,and better improves the breeding efficiency of farmers.During the reporting period,the
190、companys animal healthcare business achieved the income of 1.1 billion yuan,a slight increase year-on-year.Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 21 3.Haids model is promoted to the international market and explore overseas sales and profit margins During the reporting p
191、eriod,the companys overseas feed sales volume reached 1.71 million tons,a year-on-year increase of 24%,and the profitability of products increased rapidly,and the profit growth was higher than the sales growth.The companys overseas feed business,through the construction of local factories and sales,
192、and supporting high-quality seedlings,animal healthcare and professional technical service systems,copied the mature domestic feed+seedlings+animal healthcare golden triangle model to overseas markets,forming a competitive advantage in the industrial chain,and gradually explores the growth of overse
193、as markets.In Southeast Asia,the company takes Vietnam as the core and actively expands markets such as Indonesia,Bangladesh and Malaysia.In Africa,with Egypt as a bridgehead,it gradually extends to the North African and East African markets.In South America,the company has also established business
194、 layout in Ecuador and has set up team to develop neighboring countries.After being familiar with the characteristics of breeding and consumption in overseas local markets,the company relies on domestic R&D technology,combined with local raw material procurement and breeding characteristics to impro
195、ve product strength,and the domestic mature technology can be gradually transformed in foreign markets,and there is a large space for improving the profitability of overseas business products.On the basis of specialization,the breeding business to achieve the asset-light,low-risk model of stable dev
196、elopment In the pig breeding business,the company slaughtered about 4.6 million heads throughout the year,the professional ability of the team continued to improve,the breeding cost decreased,and combined with the effective business risk control system,the annual pig breeding business loss was contr
197、ollable.The company continues to focus on the construction of its own breeding pig system,the system is gradually taking shape,and the R&D and scale advantages of the feed end are superimposed,and the comprehensive breeding cost has made significant progress.The pig business implemented the consolid
198、ating foundation plan throughout the year,and achieved good results at the breeding end and fattening end,with the annual seedling production at the breeding end increasing by 26%,and the survival rate of the stock at the fattening end increasing to over 97.5%.In addition,in the context of overcapac
199、ity in the industry,the company focuses on exploring and implementing the operation model of purchasing piglets,company plus family farm,locking in profits,and hedging risks.While the pig breeding business operates efficiently,it can also build a service system for pig feed,provide breeding solution
200、s and service personnel with professional breeding experience,and improve the service capacity of pig feed business.In the aquaculture business,the companys main aquaculture species are raw fish and shrimp special aquatic products,and the operating income during the reporting period was about 1.4 bi
201、llion yuan.The raw fish farming business was affected by the sluggish market sales price,and the annual loss exceeded 300 million yuan.The company has formulated reasonable breeding plan,improved the breeding management model,has controlled the scale of breeding,and strengthened the control of breed
202、ing risks.Through the scientific design of the factory,the circulating water system,the biological bait technology and the strict biological prevention and control,the factory shrimp farming has the advantages of safety and controllability and stable quality compared with the traditional aquaculture
203、 mode,and form a dislocation competition with the traditional products in terms of the time to market and product specifications.In the process of steady progress of factory shrimp farming,the professional ability of the team has been continuously improved,and the business model has been gradually c
204、onfirmed.In the future,the company will further consolidate its business foundation,and the aquaculture business will develop steadily under the premise of controllable risks and controlled investment scale.The trade business is mainly the trade of feed raw materials,and the company provides raw mat
205、erial procurement for the industry through large-scale and professional procurement capabilities.During the reporting period,due to the continuous loss of pig breeding,the industry is generally short of funds and the risk is large,so the company controls the scale of trade,reduces the operating risk
206、,and the raw material trade business was decreased by 44.86%year-on-year.Chinas feed industry is in a period of profound change,and the contradiction of overcapacity is prominent,providing greater development opportunities for industry differentiation and integration.In the future,the company will m
207、aintain its strategic focus,consolidate the foundation of its main feed business,optimize and upgrade supporting products,services and solutions around the core business of feed,seedlings and animal healthcare,adhere to the mission of rejuvenating agriculture with science and technology,strengthen i
208、ts ability to create value for customers,achieve the target of 40 million tons of feed sales,and continue to improve the profitability of its products.Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 22 2.Revenue and cost(1)Components of operating income Unit:RMB 2023 2022 Increas
209、e/decrease Amount%of operating income Amount%of operating income Total operating income 116,117,168,742.97 100%104,715,417,485.92 100%10.89%By industry Feed industry 100,625,094,888.81 86.66%92,259,788,044.27 88.11%9.07%Farming industry 15,492,073,854.16 13.34%12,455,629,441.65 11.89%24.38%By produc
210、t Feed 95,956,237,795.73 82.64%84,892,419,774.07 81.07%13.03%Animal healthcare products 1,094,616,254.63 0.94%1,044,659,775.65 1.00%4.78%Agricultural products 15,492,073,854.16 13.34%12,455,629,441.65 11.89%24.38%Trade business 3,400,500,883.54 2.93%6,167,203,348.23 5.89%-44.86%Other businesses 173,
211、739,954.91 0.15%155,505,146.32 0.15%11.73%By region Southern China 69,265,386,101.27 59.65%63,200,713,601.52 60.35%9.60%Eastern China 16,173,847,857.34 13.93%14,161,170,693.21 13.52%14.21%Northern China 32,361,476,949.29 27.87%32,620,746,322.29 31.15%-0.79%Central China 32,394,634,731.85 27.90%28,90
212、1,065,227.88 27.60%12.09%Overseas 10,935,313,584.80 9.42%8,578,402,746.94 8.19%27.47%Combined offset-45,013,490,481.58-38.77%-42,746,681,105.92-40.82%5.30%(2)Industries,products,regions or sales models accounting for over 10%of operating income or operating profit of the Company Applicable Not appli
213、cable Unit:RMB Operating income Operating costs Gross profit margin Increase/decrease of operating income as compared to the corresponding period of the prior year Increase/decrease of operating costs as compared to the corresponding period of the prior year Increase/decrease of gross profit margin
214、as compared to the corresponding period of the prior year Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 23 By industry Feed industry 100,625,094,888.81 91,754,406,302.45 8.82%9.07%8.39%0.57%Farming industry 15,492,073,854.16 14,526,212,163.23 6.23%24.38%40.28%-10.64%By product
215、Feed 95,956,237,795.73 87,775,522,325.73 8.53%13.03%12.45%0.48%Animal healthcare products 1,094,616,254.63 552,554,966.91 49.52%4.78%3.13%0.81%Agricultural products 15,492,073,854.16 14,526,212,163.23 6.23%24.38%40.28%-10.64%Trade business 3,400,500,883.54 3,384,436,709.49 0.47%-44.86%-43.81%-1.86%B
216、y region Southern China 69,265,386,101.27 64,940,181,106.91 6.24%9.60%13.23%-3.02%Eastern China 16,173,847,857.34 15,315,359,092.57 5.31%14.21%14.89%-0.55%Northern China 32,361,476,949.29 31,352,223,665.40 3.12%-0.79%-0.54%-0.24%Central China 32,394,634,731.85 31,359,923,988.17 3.19%12.09%14.86%-2.3
217、4%Overseas 10,935,313,584.80 9,661,321,418.15 11.65%27.47%25.52%1.38%Under the circumstances that the statistics specification for the Companys principal operations data experienced adjustment in the reporting period,the principal operations data upon adjustment of the statistics specification at th
218、e end of the reporting period in the latest year Applicable Not applicable(3)Whether revenue from sales in kind is higher than revenue from services Yes No By industry Item Unit 2023 2022 Increase/decrease Feed industry Sales volume 10,000 tons 2,440.23 2,165.11 12.71%Production output 10,000 tons 2
219、,427.65 2,179.47 11.39%Inventories 10,000 tons 26.12 38.70-32.51%Explanation on why the related data varied by more than 30%Applicable Not applicable The Companys inventories decreased 32.51%during the reporting period compared with last year,primarily driven by the Companys decreased stock of produ
220、cts.(4)Performance of material sales contracts and material procurement contracts of the Company during the reporting period Applicable Not applicable Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 24 (5)Composition of operating costs Unit:RMB By industry Item 2023 2022 Increase
221、/decrease Amount%of total operating costs Amount%of total operating costs Feed industry Material costs 88,202,446,185.50 96.13%81,348,581,533.59 96.10%8.43%Feed industry Labour costs 989,977,644.07 1.08%901,705,904.44 1.07%9.79%Feed industry Manufacturing expenses 2,339,254,579.25 2.55%2,205,869,130
222、.50 2.61%6.05%Feed industry Contract performance costs 180,835,593.31 0.20%163,938,546.21 0.19%10.31%Feed industry Others 41,892,300.32 0.04%28,573,596.86 0.03%46.61%Total of feed industry 91,754,406,302.45 100.00%84,648,668,711.60 100.00%8.39%Farming industry Material costs 12,396,546,681.62 85.34%
223、8,602,722,539.07 83.08%44.10%Farming industry Labour costs 1,366,507,811.60 9.41%1,094,517,161.31 10.57%24.85%Farming industry Manufacturing expenses 732,405,482.14 5.04%629,048,626.34 6.07%16.43%Farming industry Contract performance costs 30,752,187.87 0.21%28,623,061.91 0.28%7.44%Total of farming
224、industry 14,526,212,163.23 100.00%10,354,911,388.63 100.00%40.28%Unit:RMB By product Item 2023 2022 Increase/decrease Amount%of total operating costs Amount%of total operating costs Feed Material costs 84,349,916,329.38 96.10%74,869,360,421.56 95.91%12.66%Feed Labour costs 961,282,644.51 1.10%874,42
225、1,190.94 1.12%9.93%Feed Manufacturing expenses 2,303,531,792.17 2.62%2,172,776,439.83 2.78%6.02%Feed Contract performance costs 160,791,559.67 0.18%144,200,929.62 0.18%11.51%Total feed 87,775,522,325.73 100.00%78,060,758,981.95 100.00%12.45%Animal healthcare products Material costs 468,093,146.63 84
226、.71%455,690,788.17 85.05%2.72%Animal healthcare products Labour costs 28,694,999.56 5.19%27,284,713.51 5.09%5.17%Animal healthcare products Manufacturing expenses 35,722,787.08 6.47%33,092,690.67 6.18%7.95%Animal healthcare products Contract performance costs 20,044,033.64 3.63%19,737,616.59 3.68%1.
227、55%Total animal healthcare products 552,554,966.91 100.00%535,805,808.94 100.00%3.13%Agricultural products Material costs 12,396,546,681.62 85.34%8,602,722,539.07 83.08%44.10%Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 25 By product Item 2023 2022 Increase/decrease Amount%of
228、total operating costs Amount%of total operating costs Agricultural products Labour costs 1,366,507,811.60 9.41%1,094,517,161.31 10.57%24.85%Agricultural products Manufacturing expenses 732,405,482.14 5.04%629,048,626.34 6.07%16.43%Agricultural products Contract performance costs 30,752,187.87 0.21%2
229、8,623,061.91 0.28%7.44%Total agricultural products 14,526,212,163.23 100.00%10,354,911,388.63 100.00%40.28%Trade business Sales costs 3,384,436,709.49 100.00%6,023,530,323.85 100.00%-43.81%Other businesses Sales costs 41,892,300.32 100.00%28,573,596.86 100.00%46.61%Notes None (6)Change of scope of c
230、onsolidation during the reporting period Yes No During the year,the scope of consolidation included 557 subsidiaries,increasing by 52 and reducing by 23 as compared with the last year.For details,please refer to the Note VII.Interests in Other Entities in Section X“Financial Statements.(7)Significan
231、t change in or adjustment of the businesses,products or services of the Company during the reporting period Applicable Not applicable(8)Sales to major customers and major suppliers Sales to major customers of the Company Total sales to top 5 customers(RMB)2,051,068,748.94 Total sales to top 5 custom
232、ers as a percentage of the total sales for the year 1.77%Sales to top 5 customers who are related parties as a percentage of the total sales for the year 0.00%Information on top 5 customers of the Company No.Name of customer Sales(RMB)As a percentage of the total sales for the year(%)1 No.1 611,757,
233、619.24 0.53%2 No.2 413,695,864.30 0.36%3 No.3 388,903,096.38 0.33%4 No.4 322,044,728.58 0.28%5 No.5 314,667,440.44 0.27%Total -2,051,068,748.94 1.77%Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 26 Other explanation of major customers Applicable Not applicable The top five cust
234、omers of the Company are mainly customers of livestock and poultry feed.The top five customers have no related relationship with the Company.The Companys directors,supervisors,senior management,core technical personnel,shareholders holding more than 5%of shares,actual controller and other related pa
235、rties do not have direct or indirect interest in the major customers.The top five customers accounted for 1.77%of total annual sales.The Companys sales revenue does not depend on single or top five customers.Major suppliers of the Company Total purchases from top 5 suppliers(RMB)15,399,513,275.63 To
236、tal purchases from top 5 suppliers as a percentage of the total purchases for the year 15.41%Total purchases from top 5 suppliers who are related parties as a percentage of the total purchases for the year 0.00%Information on top 5 suppliers of the Company No.Name of supplier Purchases(RMB)As a perc
237、entage of the total purchases for the year(%)1 No.1 8,720,058,449.06 8.72%2 No.2 2,358,904,001.81 2.36%3 No.3 1,989,772,692.22 1.99%4 No.4 1,300,102,277.02 1.31%5 No.5 1,030,675,855.52 1.03%Total -15,399,513,275.63 15.41%Other explanation of major suppliers Applicable Not applicable The top five sup
238、pliers of the Company have no related relationship with the Company.The Companys directors,supervisors,senior management,core technical personnel,shareholders holding more than 5%of shares,actual controller and other related parties do not have direct or indirect interest in the major suppliers.The
239、top five suppliers accounted for 15.41%of total annual purchases.The Companys purchases do not depend on single or top five suppliers.3.Expenses Unit:RMB 2023 2022 Increase/decrease Reasons for material changes Selling and distribution expenses 2,259,143,012.20 1,980,987,068.23 14.04%Mainly due to t
240、he expansion of the Companys sales,the increase in personnel and their remunerations,and the higher business promotion expenses General and administrative expenses 2,616,739,147.40 2,583,815,226.76 1.27%The insignificant change during the current period compared with the prior year was mainly due to
241、 the year-on-year decrease in the Companys equity incentive expenses Financial expenses 512,506,390.25 596,764,082.61-14.12%Mainly due to the decreased financings and financing costs Research and development expenses 784,880,414.03 711,235,490.13 10.35%Mainly due to the increase in R&D personnel and
242、 their remunerations,as well as in research and development investments Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 27 4.Research and development investments Applicable Not applicable Name of major R&D project Purpose Progress Specific objectives Expected impact on the Compan
243、y The establishment and maintenance of the targeted nutrition database for a range of aquatic products Targeted nutrition The accurate nutrition demand has been identified for a range of aquatic products in multiple animal husbandry modes at different phases and under different animal husbandry envi
244、ronments.To ensure more accurate nutrition,save costs of animal feeds,avoid wastes of animal feeds,protect the environment,guarantee the more complete digestion and absorption of animal feeds,and significantly improve the growth performance The costs of the animal feeds can be significantly reduced
245、and the animal husbandry costs for farmers can be magnificently decreased.The growth performance for the aquatic products can be higher,thus driving the green development of the farming industry.The establishment of the disease-resistant nutrition system for livestock and poultry The development of
246、functional animal feeds and functional additives The immunopotentiator has been developed to improve the resistance to bacterial and viral diseases in the swine and poultry herds.In terms of the common diseases for livestock and poultry,the immunopotentiator can effectively improve the disease resis
247、tance,thus providing a stronger guarantee for the healthy and effective production in the farming of livestock and poultry.Centering on the core concept of creating values for customers,the animal husbandry efficiency can be raised and product strength can be boosted.The establishment of an integrat
248、ed breeding system for shrimp and fish fry The quality and stable supply of shrimp and fish fry Six new national aquatic species have been recognized,and genetic breeding research on the remaining species continues.To complete systematic work on seed selection,conservation of germplasm resources,est
249、ablishment of germplasm families,etc.Relying on the complete industrial chain of aquaculture,the project can give play to the advantage of an integrated system of“feed+seedlings+animal health products”and promote the green and high-quality development of aquaculture.The establishment of the nutritio
250、n system of the creep feeds and nursing feeds Targeted nutrition The research on the nutrition value evaluation of different raw materials,nutrition demand,feeding modes,and feed processing has been completed,and the effects have been verified at the breeding end.To choose raw materials that are eas
251、ier to digest and absorb so that the gastrointestinal tract of piglets can better shred and digest.As a result,the piglets can be healthier and of higher survival rate due to the all-around and balanced nutrition.In addition,the piglets can have better intestinal development and less diarrhea.The an
252、imal feeds can be better chewed to make the nutrition absorption better and more balanced to make the piglets grow faster.The good quality of creep feeds and nursing feeds can be created,thus making it the industrial benchmark.Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 28 Re
253、search and development personnel of the Company 2023 2022 Percentage change Research and development headcount 3,525 3,382 4.23%Ratio of research and development personnel 9.08%9.39%-0.31%Educational background of research and development personnel Bachelors degree 885 827 7.01%Masters degree 800 76
254、3 4.85%Doctoral degree 115 113 1.77%Age structure of research and development personnel Below 30 1,915 1,844 3.85%3040 1,099 1,026 7.12%4050 331 330 0.30%Over 50 180 182-1.10%Research and development investments of the Company 2023 2022 Percentage change Research and development investments(RMB)803,
255、082,298.63 711,235,490.13 12.91%Research and development investments as%of operating income 0.69%0.68%0.01%Capitalized amount of research and development investments(RMB)18,201,884.60 5,081,480.58 258.20%Capitalized research and development investments as%of total research and development investment
256、s 2.27%0.71%1.56%Reasons for significant change in the composition of research and development personnel and the impact Applicable Not applicable Reasons for significant change in total research and development investments as%of operating income Applicable Not applicable Reasons for significant chan
257、ge in capitalization rate of research and development investments and explanations thereon Applicable Not applicable 5.Cash flows Unit:RMB Item 2023 2022 Increase/decrease Sub-total of cash inflows from operating activities 119,076,079,621.32 106,959,926,011.77 11.33%Sub-total of cash outflows for o
258、perating activities 106,377,704,921.78 100,142,031,760.86 6.23%Net cash flows from operating activities 12,698,374,699.54 6,817,894,250.91 86.25%Sub-total of cash inflows from investing activities 5,655,779,524.28 8,817,852,475.04-35.86%Full text of 2023 Annual Report of Guangdong Haid Group Co.,Lim
259、ited 29 Sub-total of cash outflows for investing activities 9,475,754,280.35 14,263,337,049.36-33.57%Net cash flows from investing activities-3,819,974,756.07-5,445,484,574.32 29.85%Sub-total of cash inflows from financing activities 10,363,673,588.82 14,012,643,640.87-26.04%Sub-total of cash outflo
260、ws for financing activities 16,016,845,242.92 14,942,687,770.42 7.19%Net cash flows from financing activities-5,653,171,654.10-930,044,129.55-507.84%Net increase in cash and cash equivalents 3,245,099,423.10 441,039,279.27 635.78%Explanation on main effects of material changes Applicable Not applica
261、ble 1.Net cash flows from operating activities increased by 86.25%as compared to the corresponding period of the prior year mainly due to the increased cash received from sales of goods in the period.2.Net cash flows from investing activities increased by 29.85%as compared to the corresponding perio
262、d of the prior year mainly because the Companys production capacity of 40 million tons of feed has been put in place and the payment for acquisition of fixed assets,intangible assets and other long-term assets decreased accordingly.3.Net cash flows from financing activities decreased by 507.84%as co
263、mpared to the corresponding period of the prior year mainly due to the decreased loans.Explanation on main reasons leading to the material difference between net cash flows from operating activities during the reporting period and net profit for the year Applicable Not applicable V.Analysis of Non-P
264、rincipal Operations Applicable Not applicable VI.Analysis of Assets and Liabilities 1.Material changes of asset items Unit:RMB As at the end of 2023 As at the beginning of 2023 Percentage change Description of major changes Amount As%of total assets Amount As%of total assets Cash at bank and on hand
265、 5,476,452,778.79 12.24%2,260,586,666.69 5.08%7.16%At the end of the period,the percentage in total assets increased by 7.16 percentage points;and the balance increased by 142.26%from the beginning of the period,which was mainly due to the increased cash from operating activities as a result of the
266、expansion of the Companys business scale.Accounts receivable 2,056,713,658.36 4.60%1,952,007,881.05 4.39%0.21%At the end of the period,the percentage in total assets increased by 0.21 percentage point;and the balance increased by 5.36%from the beginning of the period,which was almost flat with the b
267、alance at the beginning of the period.Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 30 As at the end of 2023 As at the beginning of 2023 Percentage change Description of major changes Contract assets 0.00 0.00%0.00 0.00%0.00%N/A Inventories 9,935,863,743.13 22.20%12,625,081,651
268、.36 28.39%-6.19%At the end of the period,the percentage in total assets decreased by 6.19 percentage points;and the balance decreased by 21.30%from the beginning of the period,which was mainly due to the decreased stock of raw materials.Investment properties 29,823,321.44 0.07%26,856,587.98 0.06%0.0
269、1%At the end of the period,the percentage in total assets increased by 0.01 percentage point;and the balance increased by RMB 2.97 million from the beginning of the period,which was almost flat with the balance at the beginning of the period.Long-term equity investments 216,673,525.00 0.48%315,182,8
270、88.17 0.71%-0.23%At the end of the period,the percentage in total assets decreased by 0.23 percentage point;and the balance decreased by 31.25%from the beginning of the period,which was mainly due to the withdrawal of investment from associates.Fixed assets 16,393,917,170.28 36.64%14,933,452,189.00
271、33.58%3.06%At the end of the period,the percentage in total assets increased by 3.06 percentage points;and the balance increased by 9.78%from the beginning of the period,which was mainly because the Companys projects under construction were transferred to fixed assets after completion and being put
272、into production,resulting in an increase in fixed assets.Construction in progress 687,708,201.87 1.54%1,377,352,318.21 3.10%-1.56%At the end of the period,the percentage in total assets decreased by 1.56 percentage points;and the balance decreased by 50.07%from the beginning of the period,which was
273、mainly because the Companys projects under construction were transferred to fixed assets after completion and being put into production.Right-of-use assets 2,360,221,694.26 5.27%2,371,772,104.05 5.33%-0.06%At the end of the period,the percentage in total assets decreased by 0.06 percentage point;and
274、 the balance decreased by 0.49%from the beginning of the period,which was almost flat with the balance at the beginning of the period.Short-term loans 1,396,136,213.00 3.12%2,910,809,252.56 6.55%-3.43%At the end of the period,the percentage in total assets decreased by 3.43 percentage points;and the
275、 balance decreased by 52.04%from the beginning of the period,which was mainly due to the decreased short-term bank loans and the increased repayment of loans.Contract liabilities 1,922,213,731.37 4.30%1,720,519,173.21 3.87%0.43%At the end of the period,the percentage in total assets increased by 0.4
276、3 percentage point;and the balance increased by 11.72%from the beginning of the period,which was mainly due to the increased advances from customers as a result of a larger business size.Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 31 As at the end of 2023 As at the beginning
277、of 2023 Percentage change Description of major changes Long-term loans 3,027,758,789.71 6.77%5,066,407,199.42 11.39%-4.62%At the end of the period,the percentage in total assets decreased by 4.62 percentage points;and the balance decreased by 40.24%from the beginning of the period,which was mainly d
278、ue to the early repayment of part of the long-term loans.Lease liabilities 1,619,548,546.37 3.62%1,610,426,421.30 3.62%0.00%At the end of the period,the percentage in total assets was flat with the balance at the beginning of the period;and the balance increased by 0.57%from the beginning of the per
279、iod,which was almost flat with the balance at the beginning of the period.Held-for-trading financial assets 1,286,752,498.95 2.88%699,942,009.75 1.57%1.31%At the end of the period,the percentage in total assets increased by 1.31 percentage points;and the balance increased by 83.84%from the beginning
280、 of the period,which was mainly due to the increased cash management with idle funds.Prepayments 743,154,926.15 1.66%1,787,282,249.33 4.02%-2.36%At the end of the period,the percentage in total assets decreased by 2.36 percentage points;and the balance decreased by 58.42%from the beginning of the pe
281、riod,which was mainly due to the decreased stock of raw materials,resulting in a corresponding decrease in prepayments.Notes payable 5,897,614,880.98 13.18%3,502,208,518.33 7.88%5.30%At the end of the period,the percentage in total assets increased by 5.30 percentage points;and the balance increased
282、 by 68.40%from the beginning of the period,which was mainly due to the increased settlements with notes in the procurement of raw materials.Other payables 839,176,371.57 1.88%468,736,318.76 1.05%0.83%At the end of the period,the percentage in total assets increased by 0.83 percentage point;and the b
283、alance increased by 79.03%from the beginning of the period,which was mainly due to the increased payables to holders under the 2023 employee stock ownership plan.Overseas assets account for a larger proportion in total assets Applicable Not applicable 2.Assets and liabilities measured at fair value
284、Applicable Not applicable Unit:RMB Item Opening balance Gain or loss from changes in fair value during the period Cumulative fair value changes recognized in equity Impairment provided during the period Purchases during the period Disposal during the period Other changes Closing balance Full text of
285、 2023 Annual Report of Guangdong Haid Group Co.,Limited 32 Financial assets 1.Held-for-trading financial assets(exclusive of derivative financial assets)439,630,197.91-24,393,860.68 14,324,188.55 270,014,574.45 5.Other non-current financial assets 266,944,754.12-16,802,796.88 141,654.00 1,600,000.00
286、 248,683,611.24 Sub-total of financial assets 706,574,952.03-41,196,657.56 14,324,188.55 141,654.00 1,600,000.00 518,698,185.69 Others(note)260,311,811.84 6,426,112.66 1,010,000,000.00 261,169,386.67 1,016,737,924.50 Total of the above 966,886,763.87-34,770,544.90 14,324,188.55 1,010,141,654.00 262,
287、769,386.67 1,535,436,110.19 Financial liabilities 46,533,780.00 19,611,136.00 22,203,844.99 Note:Others are banks wealth management products.Contents of other changes None Whether there were any material changes on the measurement attributes of major assets of the Company during the reporting period
288、 Yes No 3.Restriction on asset rights as at the end of the reporting period As at the end of the reporting period,the Company still had restricted assets of RMB 115,204,438.33,which were mainly land reclamation deposits,letter of credit deposits,guarantee deposits,deposits for bank guarantees,un-der
289、ecognized notes receivable that are endorsed and outstanding,and properties preserved.VII.Analysis of Investments 1.Overview Applicable Not applicable Investments during the reporting period(RMB)Investments during the corresponding period of prior year(RMB)Change 3,353,272,322.86 5,001,931,119.51-32
290、.96%2.Material equity investments during the reporting period Applicable Not applicable 3.Material non-equity investments during the reporting period Applicable Not applicable Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 33 4.Financial investments(1)Securities investments Appl
291、icable Not applicable The Company did not make any securities investment in the reporting period.(2)Derivatives investments Applicable Not applicable 1)Derivatives investments for hedging purposes in the reporting period Applicable Not applicable Unit:RMB0,000 Type of derivative investment Initial i
292、nvestment amount Opening investment amount Gain or loss from changes in fair value during the period Cumulative fair value changes recognized in equity Purchased in the period Sold in the period Closing investment amount Closing investment amount as%of the Companys closing net assets Futures company
293、 0 48,631.02 1,761.29 36,105.46 494,393.52 489,346.77 57,967.83 2.95%Commercial bank 0 0-2,176.11-362.48 0 0 0 0.00%Total 0 48,631.02-414.82 35,742.98 494,393.52 489,346.77 57,967.83 2.95%Explanation of significant changes in accounting policies and specific accounting measurement principles in resp
294、ect of the hedges for the reporting period as compared to the previous reporting period The Company conducted accounting processing of hedging business in accordance with the stipulations in the Accounting Standards for Business Enterprises No.22-Recognition and Measurement of Financial Instruments(
295、企業會計準則第 22 號金融工具確認和計量),the Accounting Standards for Business Enterprises No.23-Transfer of Financial Assets(企業會計準則第 23 號金融資產轉移),the Accounting Standards for Business Enterprises No.24-Hedging Accounting(企業會計準則第 24 號套期會計)and the Accounting Standards for Business Enterprises No.37-Presentation of Fina
296、ncial Instruments(企業會計準則第 37 號金融工具列報)as well as their guidelines.In 2023,no significant changes occurred to the accounting policies and measurements in respect of the hedges for the reporting period as compared to the previous reporting period.Explanation of the actual gains and losses in the report
297、ing period The Company conducts commodity futures hedges in order to hedge against fluctuations in the market prices of raw materials such as corn and meal,as well as the risk of fluctuations in expected future cash flows arising from matters such as the expected sales of pigs;and foreign exchange h
298、edges in order to hedge against the operational risks posed to the Company by fluctuations in foreign exchange rates.During the reporting period,the actual net gain after offsetting the gains and losses on the Companys commodity and foreign exchange hedging derivative contracts and spots was RMB 154
299、 million.Explanation of the effect of hedges The Company engaged in commodity futures hedges mainly for corn,meal and other raw materials related to production and operation.The risk of changes in the value of the hedged items was effectively hedged through changes in the value of the hedging instru
300、ments,with the expected risk management objectives basically achieved.The Companys foreign exchange hedges were carried out because the Companys overseas bank loans and procurement were exposed to the risk of exchange rate fluctuations.By carrying out forward foreign exchange settlement and sale,cur
301、rency swaps,etc.,the Company was able to lock in the exchange rate costs and effectively hedge the uncertainty risk arising from exchange rate fluctuations.Funding source Self-funded Risk analysis of positions held in derivatives during 1.The hedging business was compatible with the production and o
302、peration of the Company.The Company strictly controlled the positions of futures and options,conducted foreign exchange hedging transactions in Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 34 the reporting period and explanation of control measures(Including but not limited to
303、 market risk,liquidity risk,credit risk,operational risk,legal risk,etc.)strict accordance with its projected collection period,payment period and amount,and reasonably made use of futures,options,portfolios of the aforementioned products,foreign exchange hedging and other instruments to have a lock
304、 on the Companys costs and expenses of raw materials of animal feeds and other related products.2.Relevant departments and personnel strictly controlled the scale of hedging funds,reasonably planned and used the margin,and gave operation instructions in strict accordance with the Companys futures tr
305、ading management policies.No operation could be carried out unless it had been approved in light of related regulations.The Company will reasonably allocate funds for its hedging business.3.In accordance with the Guidelines No.1 of the Shenzhen Stock Exchange for the Self-regulation of Listed Compan
306、iesthe Standard Operation of Main Board Listed Companies(深圳證券交易所上市公司自律監管指引第 1 號-主板上市公司規范運作),the Management System for Futures Hedging Operations(期貨套期保值業務管理制度),the Measures for Futures Management(期貨管理辦法),and the Management Measures for the Operation of Pig Futures(生豬期貨業務操作管理辦法)have been formulated,wh
307、ich clearly stipulate the approval authority,internal review process and risk handling procedures for hedging business.The Company has established a special team for commodity hedging operation and a monitoring team for commodity hedging operation,and developed corresponding business procedures.Rele
308、vant business and activities were controlled through the implementation of authorization,position restraint,internal audit and other measures.4.The Company has formulated the Management System for Foreign Exchange Hedging Operations(外匯套期保值業務管理制度),which clearly stipulates the limit of foreign exchang
309、e hedging business,the scope of varieties,approval authority,internal review procedures,responsible departments and persons,information isolation measures,internal risk reporting policies and risk handling procedures.The Policy is in conformity with the relevant requirements of regulatory authoritie
310、s,meets the needs of actual operation,and contains effective risk control measures.5.The Securities Department of the Company conducted regular and irregular inspections of the hedging transaction business,and supervised the implementation of risk management policies and risk management procedures b
311、y the personnel taking charge of the hedging transaction business,to timely prevent operational risks in the business.Changes in market prices or fair value of derivative products during the reporting period,specific methods used and relevant assumption and parameter settings shall be disclosed for
312、analysis of fair value of derivatives Since the Companys varieties of commodity hedging transactions were traded at futures exchanges,with transparent markets and active transactions,the transaction price and the settlement unit price of the day could fully reflect the fair value of the derivatives.
313、The varieties of foreign exchange hedging transactions were measured at the fair value on the date of contract signing between the Company and commercial banks,and their fair value was subsequently measured based on the valuation notices issued by each commercial bank at the end of the period.Legal
314、matters involved(if applicable)N/A Disclosure date of the announcement about the boards consent for the derivative investment(if any)25 April 2023 Disclosure date of the announcement about the shareholders general meetings consent for the derivative investment(if any)16 May 2023 Special opinions exp
315、ressed by independent directors concerning the Companys derivatives investment and risk control 1.The commodity hedging business of the Company was carried out in strict accordance with relevant policies.Therefore,the Company effectively controlled the costs and prices of products involved in its pr
316、oduction and trading activities,and effectively prevented and mitigated risks.The relevant approval procedures for the Company to use its own funds to carry out hedging business in commodity futures and options markets were in compliance with relevant national laws and regulations as well as provisi
317、ons in the Articles of Association(公司章程).The Company has established a sound organizational structure and developed the Management System for Futures Hedging Operations(期貨套期保值業務管理制度)for commodity hedging.There is no circumstance where the interest of the Company and its entire shareholders has been
318、damaged.2.The decision-making procedures of the Company for foreign exchange hedging business were in compliance with relevant national laws and regulations as well as provisions in the Articles of Association.Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 35 The Company made us
319、e of foreign exchange hedging instruments to reduce exchange rate risks and financial expenses and control operational risks on the basis of normal production and operation.There is no circumstance where the interest of the Company,its entire shareholders and especially,its minority shareholders has
320、 been damaged.At the same time,the Company has formulated the Management System for Foreign Exchange Hedging Operations(外匯套期保值業務管理制度).By strengthening internal control and implementing risk prevention measures,specific operation standards have been developed for the Companys foreign exchange hedging
321、 business.In summary,it is approved that the Company and its majority-owned subsidiaries carry out commodity hedging business and foreign exchange hedging business within the limit approved by the Board of Directors.2)Derivatives investments for speculative purposes in the reporting period Applicabl
322、e Not applicable The Company did not make any derivatives investment for speculative purposes in the reporting period.5.Use of raised funds Applicable Not applicable(1)Overall use of raised funds Applicable Not applicable Unit:RMB0,000 Year for fund-raising Method of fund-raising Total raised funds
323、Net proceeds Total raised funds that have been used in the current period Total raised funds that have been used accumulatively Total raised funds with altered purposes during the reporting period Total accumulative raised funds with altered purposes Proportion of total accumulative raised funds wit
324、h altered purposes Total raised funds that have not been used yet Use and ownership change of unused raised funds Raised funds that have been left unused for over two years 2020 Public offering of convertible corporate bonds 283,000 281,085.42 47,386.08 282,912.17 6,079.28 79,823.52 28.21%0 N/A 0 To
325、tal -283,000 281,085.42 47,386.08 282,912.17 6,079.28 79,823.52 28.21%0-0 Explanation of the overall use of raised funds Upon the approval of the CSRC through the issuance of the Approval on the Public Offering of Convertible Corporate Bonds by Guangdong Haid Group Co.,Limited(關于核準廣東海大集團股份有限公司公開發行可轉
326、換公司債券的批復)(Zheng Jian Xu Ke 2020 No.205),the Company was allowed to issue convertible corporate bonds with a total face value of RMB 2,830 million to the public.Actually,the Company issued 28.30 million convertible corporate bonds with a face value of RMB 100 each to the public,and raised RMB 2,830,0
327、00,000.00 of funds in total.After deducting the fees related to the issuance,the actual net raised funds was RMB 2,810,854,230.16.The availability of the above-mentioned raised funds has been verified by Grant Thornton China(Special General Partnership),which issued the Capital Verification Report(驗
328、資報告)(Grant Thornton Yan Zi 2020 No.440ZC0065)on 26 March 2020.As at 31 December 2023,the Company used RMB 2,829.1217 million of raised funds,and accrued RMB 18.2775 million of interest income(with banks handling fees,etc.deducted).Full text of 2023 Annual Report of Guangdong Haid Group Co.,Limited 3
329、6 (2)Committed projects of raised funds Applicable Not applicable Unit:RMB0,000 Committed investment projects and investment of excessive raised funds Whether projects have been altered(including partial alternation)Total committed investment with raised funds Adjusted total investment amount(1)The
330、investment amount during the reporting period Accumulative investment amount as at the end of the reporting period(2)Investment progress as at the end of the reporting period(3)(2)/(1)Date when the projects are ready for their intended use Benefits recorded during the reporting period Whether the es
331、timated benefits are reached Whether there are material changes in the project feasibility Committed investment projects 1.Animal feed project of Nantong Haid with an annual output of 240,000 tons(hereinafter referred to as the Nantong Haid project)No 7,144.21 7,144.21 0 7,200.25 100.78%31 October 2
332、021 114.79 No No 2.Animal feed project of Qingyuan Haid with an annual output of 240,000 tons(hereinafter referred to as the Qingyuan Haid project)No 6,493.11 6,493.11 0 6,504.38 100.17%30 September 2021 1,117.6 No No 3.Animal feed project of Huaian Hailong with an annual output of 200,000 tons(here
333、inafter referred to as the Huaian Hailong project)Yes 16,123.49 11,177.39 150.29 11,231.51 100.48%31 December 2022-8.64 No No 4.Animal feed project of Nanning Haid with an annual output of 480,000 tons(hereinafter referred to as the Nanning Haid project)No 23,589.07 23,589.07 840.85 23,687.4 100.42%31 October 2022-525.07 No No 5.Animal feed project of Zhaoqing Gaoyao with an annual output of 240,0
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