Cofco Joycome Foods Limited · HKEX:1610
Cofco Joycome Foods — FY2016 Earnings Presentation
25 slides from Cofco Joycome Foods's earnings presentation, March 2017
Slide 1: Management Presentation by COFCO Meat Holdings Limited
From Farming to Table, Tasty and Safe, COFCO Joycome Management Presentation by COFCO Meat Holdings Limited March, 2017
Slide 2: Disclaimer
Disclaimer By attending the meeting where this presentation is made, or by reading the presentation materials, you agree to be bound by the following limitations: • The information in this presentation has been prepared by COFCO Meat Holdings Limited (the “Company”, and together with its subsidiarie
Slide 3: List of HSI and Shenzhen-Hong Kong Stock Connect
List of HSI and Shenzhen-Hong Kong Stock Connect Company’s stock was selected into HSI series, and became one of the underlying securities of Shenzhen-Hong Kong Stock Connect on March 6th 2017 Hang Seng Consumer Goods & Service Industry Index Hang Seng Stock Connect Hong Kong Index Hang Seng S
Slide 4: Performance Overview
1 Performance Overview 2 Business Overview 3 Strategy and Outlook
Slide 5: Financial Highlights of 2016
Financial Highlights of 2016 1 A realized net profit of RMB952MM with remarkable growth in core business segments 2 Significant expansion in gross profit margin with properly controlled expense ratios 3 An all-round improvement in turnover ratio of assets 4 Significant increase of o p e r a t i ng c
Slide 6: A Realized Total Net Profit of RMB952MM
1 A Realized Total Net Profit of RMB952MM Unit（RMB, MM ） 2016 2015 YoY Revenue from continuing operations 6,616 5,056 30.9% EBITDA from continuing operations 1,263 205 516.1% An increase of Profit (before biological fair value adjustments) 890 -192 1082 Profit attributable to the owners of the Compa
Slide 7: Remarkable Growth in Core Business Segments
1 Remarkable Growth in Core Business Segments Revenue-Hog Production（RMB, MM） Revenue-Fresh Pork （RMB, MM） A capacity of 3.14MM heads by the end of A slaughtering capacity of 2MM heads by the 2016 with an annual volume of 1.71MM end of 2016 with an annual sales volume of heads 143,000 tons 2,738
Slide 8: Significant Expansion in Gross Profit Margin with Properly Controlled Expense Ratios
Significant Expansion in Gross Profit Margin 2 with Properly Controlled Expense Ratios Gross Profit（Before Fair Value Adj. ） Selling and Distribution Expenses （RMB, MM） （As % of Revenue） （RMB, MM） （As % of Revenue） 1,600 25% 300 4.5% 1,387 4.4% 264 1,400 4.4% 21.0% 20% 250 1,200 223 4.3% 1,000 200 1
Slide 9: All-round Improvement In Turnover Ratio of Assets
All-round Improvement In Turnover 3 Ratio of Assets A significant improvement of turnover efficiency Turnover Days of Turnover Days of Turnover Days of Inventory Accounts Receivable Accounts Payable 11.8 29.9 49.2 34.3 10.4 25.0 2015 2016 2015 2016 2015 2016 Note：Calculated with the average of corre
Slide 10: Significant Increase of Operating Cash Flow with a Reasonable and Healthy Capital Structure
Significant Increase of Operating Cash Flow with 4 a Reasonable and Healthy Capital Structure Significant Growth in Operating Cash Flow Reasonable and Healthy Capital Structure Total Assets (RMB, MM) Net Assets, Net Debt (RMB, MM) and and Liabilities/Total Assets (%) Net Debt/Equity Ratio (%) 119.3%
Slide 11: Business Overview
1 Performance Overview 2 Business Overview 3 Strategy and Outlook
Slide 12: Business Highlights of 2016
Business Highlights of 2016 Significant improvement of operating efficiency and continuous 1 decrease of production cost 2 Sales volume and profit of fresh pork business increased amid adverse market conditions 3 Strict control of food safety, reaching a 100% passing rate for the inspection of meat
Slide 13: Significant Improvement of Operating Efficiency and Continuous Decrease of Cost
Significant Improvement of Operating Efficiency 1 and Continuous Decrease of Cost PSY（piglets weaned Average Finishing Weight Feed Capacity Hog Production Cost per sow per year） （Kg/Head） （’000 Tons） （RMB/Kg） Work Force Efficiency of Fresh Pork Processing Cost Fresh Pork（Kg/Day） （RMB/Kg） 13
Slide 14: Sales Volume and Profit of Fresh Pork Business Increased Amid Adverse Market Conditions
Sales Volume and Profit of Fresh Pork Business Increased 2 Amid Adverse Market Conditions Fresh pork business grew amid unfavorable market, with an increase in both sales volume and profit Production of Licensed Gross Profit per ton Slaughtering Houses in China Sales Volume of Fresh Pork(000’ Tons)
Slide 15: Strict Control of Food Safety, Reaching a 100% Passing Rate
Strict Control of Food Safety, Reaching a 100% Passing 3 Rate for the Inspection of Meat Products Strict control of food safety Severe situation of food safety in the industry as some serious problems like meat containing clenbuterol, expired meat were severely troubling consumers Residue of Clenbu
Slide 16: Multiple Brand Promotion and Continuously Increasing Brand Awareness
4 Multiple Brand Promotion and Continuously Increasing Brand Awareness Multiple brand promotion Consumer On-site visit, 74 times Bus Advertisement Franchised Store of Joycome E-Commerce Precise brand positioning with continuously increasing brand awareness Joycome Fresh Pork: “five checkpoints for
Slide 17: Sustainable Development Ensured by Ecological Recycling Model
Sustainable Development Ensured by Ecological 5 Recycling Model Dongtai Base in Jiangsu Province Promotion of various methods to utilize the bioslurry, like planting rice, vegetables and fruits. Realizing the zero emission of animal waste Comparison of wheat seedling prior Comparison of saline-a
Slide 18: Smooth Construction of Production Capacity with a Considerable Scale Nationwide
Smooth Construction of Production Capacity with a 6 Considerable Scale Nationwide 37.1% YoY increase of hog production capacity with a CAGR of 40.5% in the past 3 years 300,000 capacity for II phase of Jilin facility , 330,000 capacity of II phase of Zhangbei facility and 220,000 capacity of I pha
Slide 19: Strategy and Outlook
1 Performance Overview 2 Business Overview 3 Strategy and Outlook
Slide 20: Development Strategy and Outlook
Development Strategy and Outlook Seize the opportunity to further expand hog production capacity, 1 reinforce the investment in technology and continue to decrease the production cost Promote the branded fresh pork business, and drive it to achieve a 2 leapfrog growth Optimize the sales channel stru
Slide 21: Thanks! Question and Answer
HA BF RAR D a] COFCO Meat Holdings Limited Thanks! Question and Answer 7
Slide 22: Appendix
HA BF RAR D a] COFCO Meat Holdings Limited
Slide 23: Appendix 1. Review of Pork Price
Appendix 1. Review of Pork Price The average pork price from January of 2012 to March of 2017 (Yuan/Kg) 22.0 21.0 20.0 19.0 18.0 17.0 16.0 15.0 14.0 13.0 12.0 11.0 10.0 1月 2月 3月 4月 5月 6月 7月 8月 9月 10月 11月 12月 2012 2013 2014 2015 2016 2017 Every year, the hog price would experience the similar fluct
Slide 24: Appendix 2. Stock of Sow and Hog
Appendix 2. Stock of Sow and Hog Monthly Stock of Hog and Sow in China Gradual increase in proportion of large-scale hog farms (2012/01–2017/01) 100 MM 10Thousand Sow stock (right) Hog stcck (left) Since 2015, our government has issued successively the Amendment of Environmental Protection Law, Ac
Slide 25: Appendix 3. The Price Trend of Corn and Soybean Meal
Appendix 3. The Price Trend of Corn and Soybean Meal Corn Price from January, 2012 to February, 2017 Soybean Meal Price from January, 2012 to February, (RMB/Ton) 2017 (RMB/Ton) The exit price of corn of DCE was decreased from 2110 In 2016, the average price of soybean meal is 2778 yuan/ton yuan/