DEKON AGR (02419) has announced its interim results for the six months ended June 30, 2026, reporting revenue of RMB 10.089 billion, a year-on-year decrease of 13.74%. The company recorded a net loss of RMB 1.305 billion, contrasting with a net profit of RMB 1.227 billion in the same period last year, with a loss per share of RMB 3.
During the reporting period, the hog segment remained the company's primary revenue source, generating sales of RMB 7.829 billion, down 20.7% year-on-year. The average selling price for commercial hogs was RMB 10.4 per kilogram, a significant decline of 30.9% compared to the prior year. The performance pressure was mainly attributed to the persistently sluggish hog market conditions and the substantial year-on-year drop in commercial hog selling prices.
Facing the market downturn cycle, the company has persisted in leveraging technological innovation as its core driving force, complemented by lean operations, to achieve continuous optimization in efficiency enhancement and cost reduction. The per-head loss magnitude outperformed most industry peers, highlighting the company's growing resilience against cyclical fluctuations.
The company is concentrating on three key technological areas: breed genetics, feed nutrition, and disease prevention and control. It continues to intensify R&D implementation and technology commercialization efforts, using scientific innovation to improve quality, increase efficiency, reduce consumption, and lower costs across the entire breeding process, thereby establishing a distinctive competitive barrier within the industry.
Leveraging its mature technology innovation system, the company has persistently deepened lean management throughout the breeding process. It focuses on targeted improvements in key stages such as enhancing efficiency and reducing costs at the weaning phase, and lowering consumption while boosting efficiency during the fattening phase. This approach comprehensively connects the chain from technology implementation to benefit realization, achieving a dual upgrade in production efficiency and cost management.
During the reporting period, the company fully restructured its breeding management system using digital and intelligent technologies, supplemented by financial hedging tools to smooth cyclical fluctuations and ensure comprehensive operational stability. On the breeding management front, the company has accelerated the construction of smart pig farms and the iterative upgrading of IT systems. By utilizing digital tools such as intelligent breeding platforms, automated feeding equipment, and AI-powered inspection robots, it is gradually piloting the full digitalization of breeding, feeding, biosecurity, and on-site management processes, aiming to transition breeding management from traditional experience-driven methods to data-driven decision-making.
On the risk hedging front, the company continues to flexibly employ financial derivatives such as hog futures, establishing a normalized and standardized hedging mechanism. This effectively offsets price volatility risks associated with the hog cycle and smooths the annual profit curve.