COFCO Joycome Foods Limited Issues Profit Warning: Major Loss Expected for H1 2026
Key Highlights for Investors
- Profit Warning Announced: COFCO Joycome Foods Limited has issued a profit warning for the first half of 2026, signaling a significant swing from profit to loss.
- Anticipated Loss: The company expects an unaudited loss attributable to owners before biological assets fair value adjustments to be between RMB 1,000 million and RMB 1,200 million for the six months ended June 30, 2026. This compares sharply with a profit of approximately RMB 198 million for the same period in 2025.
- Major Factor – Falling Hog Prices: The year-on-year deterioration is primarily due to a substantial drop in hog selling prices during the reporting period, which severely compressed the profit margins of the company’s core hog production business.
- Operational Measures: Despite these market headwinds, the company has taken several steps to manage costs and operational risks, including:
- Enhancing breeding research and development
- Optimizing procurement, production, and health management, resulting in significant reductions in hog production costs
- Utilizing hog futures instruments to hedge against operational risks
- Other Business Segments: The company reported robust performance in its branded business, supported by ongoing investments in new product development, branding, and channel expansion. The feed business also saw year-on-year growth in scale, driven by product innovation and market expansion.
- Insufficient to Offset Market Impact: Despite these positive developments in other segments, they were not enough to counter the adverse impact of lower hog prices, leading to a significant overall decline in profitability.
- Interim Results Pending: The figures are based on preliminary, unaudited management accounts, which are subject to adjustments. The official interim results for H1 2026 are expected to be published in late August 2026.
Important Information for Shareholders
- Price-Sensitive and Market-Moving News: This profit warning represents material inside information and may significantly impact the Company’s share price due to the magnitude of the expected loss and the reversal from prior-year profitability.
- Caution Urged: Shareholders and potential investors are strongly advised to exercise caution when dealing in the Company’s shares until the official results are released and the full extent of the financial impact is known.
Board Statement
The Board, led by Chairman and Executive Director Dr. Gao Xiang, has emphasized that the information is based on the data currently available and is subject to review and audit. The Company’s leadership includes a mix of executive, non-executive, and independent non-executive directors.
Conclusion
This announcement is highly significant for investors, as it reflects a dramatic reversal in the Company’s financial fortunes for the first half of 2026. The continued pressure from weak hog prices, despite internal cost controls and diversification efforts, is a critical issue that may weigh on the Company’s shares in the near term. Investors should closely monitor the upcoming interim results for further clarity on the Company’s financial position and outlook.
Disclaimer
The information above is based on the Company’s official announcement and preliminary unaudited management accounts. It is not a substitute for independent financial advice. Investors are urged to review the interim results when published and consider consulting with professional advisors before making investment decisions.
