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Company update: Jinxinnong Feed H1 profits fall

Shenzhen Jinxinnong Feed has reported a net profit decrease of 7.4% to 25.01 million yuan (€224,246) in the first half of 2011, according to the China Business News

The company blamed its profit decrease on higher sales expenses and administration fees during the reporting period. Also, its gross margin of pig feed dropped during the same period due to higher raw material and labour costs.
 
Percentage changes cited in this article are year-on-year. The company’s revenue increased 13.81% to 609.6 million yuan during the reporting period.
 
Jinxinnong Feed sold 154,200 tons of feed in the first half of 2011, up 13.83%. But the gross margin of feed fell 0.61% during the same period, resulting from higher raw material prices. The inputs of feed production include corn, soybean meal, fat and whey power, the prices of which respectively rose 15.04%, 1.83%, 39.74% and 0.53% in the first half of 2011.
 
The company invested 44.27 million yuan in the construction of a pig feed factory in Changsha in the first half of 2011, accounting for 44.29% of total investment. The facility has annual production capacity of 100,000 tons of feed. The firm has also poured 723,000 yuan into a 60,000-ton pig feed production base in Harbin city, Heilongjiang province, accounting for 3.62% of total investment. However, it has not begun construction on a 230,000-ton pig feed factory in Huizhou city, Guangdong province. A planned research center is also still in the pipeline.\
 
Lion Value Growth Stock Fund bought 171,400 shares of Jinxinnong Feed during the reporting period. Taikang Life bought additional shares of Jinxinnong Feed in the same period. 

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