As of the evening of January 31, the 2022 performance forecast of the pig sector has basically been disclosed, and Zhengbang Technology has become the only listed pig company with a loss of more than 10 billion yuan, which has also attracted the attention of the Shenzhen Stock Exchange.

  As soon as Zhengbang Technology released its performance forecast, the letter of concern from the Shenzhen Stock Exchange was issued that night.

In the letter of concern, the Shenzhen Stock Exchange requested the company to further explain the specific circumstances during the reporting period, such as the high mortality rate of piglets and the severe low average weight of fattened pigs due to early slaughter, including but not limited to the cause, time and duration of occurrence , the countermeasures the company has taken or plans to take (if any), etc.

  According to the Zhengbang Technology announcement, it is expected that the net profit loss in 2022 will be 11 billion to 13 billion yuan, and the provision for asset impairment will total 3 billion to 4 billion yuan.

  At present, the 2022 performance forecast of the hog sector has basically been disclosed, and the overall performance can be described as "two heavens of ice and fire".

Leading companies Muyuan and Wen's have both turned losses into profits, while Zhengbang Technology, which is on the wrong track, is facing being "*ST".

With a loss of 30 billion in two years, the Shenzhen Stock Exchange asked Zhengbang Technology why the mortality rate of piglets was too high

  2022 may be a big turning point since the establishment of Zhengbang Technology: the net profit has lost more than 10 billion for two consecutive years, and the net asset loss to a negative number is facing the risk of delisting.

  The performance forecast shows that due to the sharp decline in the scale of sales, Zhengbang Technology expects a net profit loss of 11 billion to 13 billion yuan in 2022, and a net profit loss of 9.5 billion to 11.5 billion yuan after deducting non-existing expenses. It is estimated that by the end of 2022, the net assets will be -8.4 billion yuan to -6.4 billion.

At the same time, Zhengbang Technology made provision for impairment of live pigs, fixed assets and construction in progress at the end of the period, with a total loss of 3 billion to 4 billion yuan.

Calculated according to the lower limit of the forecast net profit loss, from 2021 to 2022, the company's net profit loss attributable to the parent will reach as high as 29.8 billion yuan.

  In 2022, Zhengbang Technology will sell a total of 8.4465 million pigs, with sales revenue of 8.954 billion yuan.

Among them, 3.4788 million piglets were sold, with a sales revenue of 1.705 billion yuan, and 4.9677 million commercial pigs were sold, with a sales revenue of 7.249 billion yuan.

The gross profit loss of piglet sales is about 500 million yuan, and the gross profit loss of commercial pigs is about 4 billion yuan.

  As for the reason for the loss in selling pigs, Zhengbang Technology stated that the loss in gross profit of piglets is mainly due to the impact of the withdrawal of pregnant sows from the farm and the impact of the company's insufficient funds on subsequent fattening. Due to financial pressure, fattening pigs with lower body weight were slaughtered earlier, resulting in poor feeding results such as feed-to-meat ratio and survival rate in the fattening stage.

  Zhengbang Technology also stated that the sales volume and operating income of the feed sector fell by more than 60% compared with the same period last year, and it was also in a state of loss. The company also scrapped some assets and made impairment provisions for live pigs, etc., with a total loss of 3 billion The above two are also the reasons for the huge loss in performance.

  The Shenzhen Stock Exchange requires Zhengbang Technology to further explain the specific circumstances of the high mortality rate of the piglets and the severe low average weight of the fattened pigs due to the early slaughter, including but not limited to the cause, time and duration of the occurrence, your company has taken or The countermeasures to be taken (if any).

  The letter of concern also requires Zhengbang Technology to explain the specific situation of holding relevant biological assets by the end of 2022, and the progress of the transaction of selling the equity of the subsidiary to the controlling shareholder at a price of 1 yuan several times.

  In order to get out of the predicament, Zhengbang Technology has already started reorganization.

The announcement shows that on January 30, the company received a notice from the controlling shareholder Zhengbang Group and Jiangxi Yonglian’s substantive merger and reorganization administrator. Meeting.

  With a debt of tens of billions, Zhengbang Technology's convertible bonds have also been continuously downgraded.

According to the announcement, due to the further decline in the refinancing ability of Zhengbang Technology and the further increase in liquidity pressure, Dongfang Jincheng Credit Rating Committee decided to downgrade the credit rating of Zhengbang Technology to BB-, and the rating outlook remained negative. The credit rating is BB-.

The cycle back and forth has widened the gap in the fundamentals of listed pig companies

  Judging from the disclosed performance forecasts of listed pig companies, benefiting from the sharp rise in pig prices in the fourth quarter of last year, many pig companies will turn their net profits into profits in 2022.

  Muyuan, Wen's, New Hope, Tianbang Food, and Zhengbang Technology, five pig companies, were once regarded as the top companies in the sector by the market, and they reached the bottom of the loss many times in the cycle, widening the gap between the various pig companies.

  Specifically, Muyuan and Wen's are advancing hand in hand, and both farming businesses are profitable.

"Zigmao" Muyuan's revenue will exceed 100 billion yuan in 2022, and its net profit will exceed 10 billion yuan.

The company expects to achieve operating income of 122 billion to 127 billion yuan in 2022, compared with 78.89 billion yuan in the same period last year, and a net profit of 12 billion to 14 billion yuan. A total of 61.201 million live pigs were sold throughout the year, a year-on-year increase of 52%.

  Wen's shares have achieved a turnaround in performance. The company expects a net profit of 4.8 billion to 5.3 billion yuan, compared with a loss of 13.404 billion yuan in the same period last year.

In 2022, the company will sell 17.9086 million pigs (including hairy pigs and fresh products), a year-on-year increase of 35.49%, and 1.081 billion broiler chickens (including hairy chickens, fresh products and cooked food), a year-on-year decrease of 1.83%.

It is still unknown whether New Hope's pig farming business will be profitable.

According to the announcement, the company expects that the net profit attributable to the parent after deduction of non-existing assets will be a profit of 50 million yuan – a loss of 150 million yuan. This is mainly because the 2022 performance of Minsheng Bank (600016.SH), which New Hope invested in, has not yet been announced.

  Tianbang Foods also experienced a similar situation. The company expects a loss of 370 million to 570 million yuan in net profit attributable to the parent after deduction. During the reporting period, the sale of the subsidiary’s equity generated investment income of 1.45 billion yuan, which promoted the turnaround of the net profit attributable to the parent. It is expected to be 950 million yuan to 1.15 billion yuan.

  Regarding the continued losses in the pig farming business, Tianbang Foods explained that the company expects that the price of pigs will remain at a low level in the first half of 2023, and has made a corresponding inventory impairment provision at the end of 2022.

At the same time, the company's self-built advanced slaughtering and segmentation production capacity will be officially put into operation in June 2022. The food business is still in the stage of strategic transformation and adjustment, and the capacity utilization rate still needs to be improved.

  The pace of production expansion of pig enterprises with small market capitalization in this cycle continues to accelerate.

Pig companies such as Tangrenshen (002567.SZ), Tiankang Biology (002100.SZ), and Huatong Stock (002840.SZ) will all achieve net profit losses in 2022.

  Entering 2023, the price of pigs rose and fell in January. Especially after the Spring Festival, the demand for pork dropped rapidly, and the price of pigs also ushered in a sharp drop.

According to data from China Pig Raising Network, on January 31, the price of live pigs nationwide fell below 15 yuan/kg to 14.67 yuan/kg, down 0.43 yuan/kg from yesterday (15.10 yuan/kg).

  The entire pig farming industry has once again fallen into a phased loss. When will the new cycle actually start or the biggest highlight of the pig sector in 2023.