Wellhope Foods Co. Ltd. 2024 Annual Report
Stock Code: 603609 Stock Abbreviation (English): Wellhope Ltd.Bond Code: 113647 Bond Abbreviation (English): Wellhope Convertible Bond
Wellhope Foods Co. Ltd.
2024 Annual Report
1 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Important Statements
I. The Board of Directors the Supervisory Board the Directors Supervisors and Senior Management of
the Company hereby warrant that the contents of this annual report are true accurate and complete
and do not contain any false records misleading statements or material omissions and severally and
jointly accept legal responsibility for the contents hereof.II. All members of the Board attended the Board meeting.III. RSM CHINA CPA LLP issued a standard unqualified audit opinion on the Company’s financial
statements.IV. Mr. Jin Weidong the Legal Representative of the Company and Mr. Chen Yu the Chief Financial
Officer (responsible for accounting affairs) hereby declare that they guarantee the truthfulness
accuracy and completeness of the financial statements contained in the annual report.V. Proposed profit distribution for the reporting period approved by the Board of Directors
The Board proposes to distribute a cash dividend of RMB 0.058 per share (inclusive of tax) based on
the total number of issued shares as of the record date for dividend distribution excluding shares
repurchased and held in the Company’s repurchase account. As of April 20 2025 the Company had
919434448 shares in issue. Based on 868671037 shares which exclude 50763411 shares held in the
repurchase account the total proposed cash dividend amounts to RMB 50382920.15 (inclusive of tax).In 2024 the Company repurchased its shares through bidding on the Stock Exchange with total
consideration amounting to RMB 287387710.93. The aggregate amount of cash returned to
shareholders comprising both the cash dividend and share repurchases totaled RMB 337770631.08
representing 98.63% of the net profit attributable to shareholders of the Company for the year.Shares held in the Company’s repurchase account are not entitled to dividends. In the event of any
change in the total number of shares in issue between the date of this announcement and the record
date the per share dividend amount will remain unchanged and the total distribution amount will be
adjusted accordingly.VI. Statement on risks relating to forward-looking statements
The forward-looking statements contained in this report including but not limited to business plans
development strategies and other related information do not constitute substantive commitments by
the Company to investors. Investors are advised to pay attention to potential investment risks.VII. Whether there was any non-operating use of funds by the controlling shareholder or related
parties
No
VIII. Whether the Company provided external guarantees in violation of prescribed decision-making
procedures
No
IX. Whether more than half of the Directors failed to guarantee the truthfulness accuracy and
2 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
completeness of the Company’s annual report
No
X. Material risk warning
The relevant risk factors have been discussed in detail in this report. For further information please
refer to the subsection “Potential Risks” under “Section III – Management Discussion and Analysis”.XI. This annual report is published in both Chinese and English versions. In the event of any
inconsistency or ambiguity between the two versions the Chinese version shall prevail. The Chinese
version of the 2024 Annual Report is available on the website of the Shanghai Stock Exchange at
www.sse.com.cn.
3 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Contents
Section I Glossary .................................. 5
Section II Company Profile and Key Financial Infor... 6
Section III Management Discussion and Analysis ...... 9
Section IV Corporate Governance Environmental Prot.. 43
Section V Important Disclosures .................... 77
Section VI Changes in Common Shares and Shareholde.. 87
Section VII Corporate Bond ......................... 92
Section VIII Financial Statements .................. 95
The financial statements have been signed and sealed by the Company's Legal
Representative and the Chief Financial Officer (responsible for accounting affairs).Documents The original audit report bears the seal of the accounting firm and has also been
available for signed and sealed by the certified public accountants.inspection The full text of all documents and announcements publicly disclosed during the
reporting period on the websites designated by the China Securities Regulatory
Commission.
4 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Section I Glossary
I.Glossary
CSRC refers to China Securities Regulatory Commission
SSE Stock Exchange refers to Shanghai Stock Exchange
Wellhope
the Company refers to Wellhope Foods Co. Ltd.Reporting period the
period refers to January 1 2024-December 31 2024
The end of the
reporting period refers to December 31 2024
period-end
Koninklijke De Heus B.V. the parent company of De Heus
Royal De Heus refers to Mauritius Ltd. the biggest privately-owned feed company in
the Netherlands
Articles of Association refers to Articles of Association of Wellhope Foods Co. Ltd.General Meeting refers to The General Meeting of Shareholders of Wellhope Foods Co. Ltd.Board of Directors refers to The Board of Directors of Wellhope Foods Co. Ltd.Supervisory Board refers to The Supervisory Board of Wellhope Foods Co. Ltd.Corporate Law refers to The Corporate Law of the People's Republic of China
Securities Law refers to The Securities Law of the People's Republic of China
5 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Section II Company Profile and Key Financial Information
I. Company Information
Company name (English) Wellhope Foods Co. Ltd.Abbreviation (English) Wellhope Ltd.Company name (Chinese) 禾丰食品股份有限公司
Abbreviation (Chinese) 禾丰股份
Legal representative Jin Weidong
II. Contact Person
Secretary of the Board Representative of Securities Affairs
Name Chen Yu Zhao Changqing Ren Kunsong
No. 169 Huishan Street Shenbei New No. 169 Huishan Street Shenbei New
Address District Shenyang Liaoning Province District Shenyang Liaoning Province
China China
Tel 024-88081409 024-88081409
Fax 024-88082333 024-88082333
Email hfmy@wellhope.co hfmy@wellhope.co
III. Basic Information of the Company
No. 169 Huishan Street Shenbei New District Shenyang
Registered address
Liaoning Province China
On December 6 2016 the registered address of the
Company was changed from "No. 67 Hunnan
Development Zone Shenyang " to "No. 169 Huishan
Change of the Company's registered
Street Shenbei New District Shenyang Liaoning
address
Province". For details please refer to Announcement No.
2016-045 disclosed on the website of the Shanghai Stock
Exchange.No. 169 Huishan Street Shenbei New District Shenyang
Office address
Liaoning Province China
Postal code 110164
Company website www.wellhope-ag.com
Email hfmy@wellhope.co
IV. Place where the Annual Report is Prepared
Media designated by the Company for the China Securities Journal Shanghai Securities News
disclosure of information Securities Times
Website of the Stock Exchange where the
www.sse.com.cn
annual report is disclosed
Location where the Company’s annual report is
Securities Department
kept for inspection
V. Stock Information
Stock information
Stock type Stock exchange for IPO Stock abbreviation Stock code
Shanghai Stock Wellhope Ltd.A share 603609
Exchange (禾丰股份)
6 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
VI. Other Information
Name RSM CHINA CPA LLP
Room 2801 Block B Enterprise Plaza No. 125
Office address Qingnian Street Shenhe District Shenyang
Accounting firm (local)
Liaoning Province PRC
Name of the signing
Huang Xiao Zhao Songhe Zhang Yuanyuan
accountant
Name China Galaxy Securities Co. Ltd.Sponsor with ongoing Office address Qinghai financial building Fengtai district Beijing
supervisory Name of the sponsoring
Gao Han Qiao Na
responsibilities during representative
the reporting period Period of ongoing
August 23 2021-December 31 2024
supervision
VII. Key Accounting Data and Financial Performance Indicators for the Latest Three Years
1. Key accounting data
RMB
Fluctuation
Item 2024 2023 2022
YoY %
Revenue 32545260037.87 35970261909.41 -9.52 32811758209.54
Net profit attributable to
342468141.14-457037550.28174.93512797304.59
shareholders of the Company
Net profit attributable to
shareholders of the Company
349481351.97-503050322.71169.47518898468.37
after deducting non-recurring
gains and losses
Net cash flow from operating
1176900496.53956152750.3223.09196266510.34
activities
As at the As at the Fluctuation As at the
end of 2024 end of 2023 YoY(%) end of 2022
Net assets attributable to
6695188322.876659295008.790.547235715361.79
shareholders of the Company
Total assets 14882522901.31 14937114834.54 -0.37 15427594029.54
2. Key financial performance indicators
Fluctuation
Item 2024 2023 2022
YoY(%)
Basic earnings per share (RMB) 0.38 -0.50 176.00 0.58
Diluted earnings per share (RMB) 0.38 -0.50 176.00 0.55
Basic earnings per share after deducting non-recurring
0.39-0.55170.910.58
gains and losses (RMB)
An increase of 11.64
Weighted average return on net assets (%) 5.06 -6.58 7.48
percentage points
Weighted average return on net assets after deducting An increase of 12.41
5.17-7.247.57
non-recurring gains and losses (%) percentage points
VIII. Key Financial Figures by Quarters in 2024
RMB
Item Q1 Q2 Q3 Q4
Revenue 7221755333.00 7748860641.23 9039991748.90 8534652314.74
Net profit attributable to
-102487079.3068434366.24323185071.6253335782.58
shareholders of the Company
Net profit attributable to
shareholders of the Company
-98204158.3265869585.28323345228.1858470696.83
after deducting non-recurring
gains and losses
Net cash flow from operating
-344752921.60297860553.88460912060.55762880803.70
activities
7 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
IX.Non-recurring Gains and Losses
RMB
Item 2024 2023 2022
Gains or losses from the disposal of non-current
assets including the reversal of impairment -12802784.26 17370417.70 -4023922.69
provisions previously made
Government grants recognized in profit or loss for the
period excluding those that are closely related to the
Company’s ordinary business granted in accordance
40790123.3983115983.4143999785.07
with national policies based on established
standards and having a sustained impact on the
Company’s profit or loss
Gains or losses arising from changes in the fair value
of financial assets and financial liabilities held by
non-financial enterprises and from the disposal of -2489576.88 -1205993.28 -6371590.35
such assets and liabilities excluding effective hedging
activities related to the Company’s ordinary business
Reversal of impairment losses on individually
1288016.759122730.49
assessed receivables
Gains arising from acquisition of subsidiaries
associates or joint ventures where the cost of
14299036.3558.82
investment is less than the share of the fair value of
the identifiable net assets acquired
Other non-operating income and expenses not
-26982020.11-49135731.60-36876323.54
included in the items listed above
Other items that meet the definition of non-recurring
gains or losses in accordance with applicable 655040.54 -10565822.12 154001.44
accounting standards
Less: Income tax effects 3049188.70 21574736.43 4291726.21
Non-controlling interests’ effects
4422821.56-4586887.91-1308553.68
(after-tax)
Total -7013210.83 46012772.43 -6101163.78
X. Item Measured at Fair Value
RMB
Changes during the
Item Opening balance Closing balance Impact on profit or loss
period
Derivative financial assets 4296668.60 2441832.40 -1854836.20 -2489576.88
Total 4296668.60 2441832.40 -1854836.20 -2489576.88
8 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Section III Management Discussion and Analysis
I. Business Operation Analysis
During the reporting period the Company recorded revenue of RMB 32.545 billion representing a
year-on-year decrease of 9.52%. Net profit attributable to shareholders of the Company amounted to
RMB 342 million marking a year-on-year increase of 174.93%. Excluding non-recurring gains and losses
net profit attributable to shareholders of the Company reached RMB 349 million up 169.47%
year-on-year.
1. Feed business
In 2024 the external sales volume of feed produced by the Company’s consolidated entities amounted
to 3.96 million tons representing a year-on-year decrease of 8%. The breakdown of sales volume is as
follows:
Variety 2024 (10000 tons) Percentage of total
Pig feed 141 36%
Poultry feed 170 43%
Ruminant feed 68 17%
Other feed 17 4%
Total 396 100%
A. Driving cross-functional collaboration to reduce costs and improve efficiency
During the reporting period China’s macroeconomic recovery remained sluggish with weak consumer
demand driving a sustained decline in most meat prices—except for pork. This triggered a widespread
exit of backyard farms and accelerated consolidation in the livestock sector intensifying competition
and adding further margin pressure on upstream feed producers. To absorb excess capacity from
previous expansions and boost utilization rates feed producers in some regions resorted to price
competition. Amid such fierce industry rivalry we reinforced cross-functional coordination to reduce
costs enhance efficiency and strengthen overall competitiveness. On the technical front we continued
upgrading nutritional systems and feeding models refined feed formulation database and boosted the
commercialization of R&D outcomes. Efforts focused on reducing feed costs per kilogram of weight gain
with high-volume product lines delivering steady improvements in both cost-effectiveness and market
competitiveness. In procurement we continued strengthening core sourcing organization. For key raw
material categories we built internal long-term talent pipelines and engaged external experts to
support major purchasing decisions. These measures significantly enhanced our market analysis. These
combined efforts significantly improved our market intelligence and price forecasting capabilities. In
2024 our average procurement prices for both energy and protein feed raw materials remained well
below industry averages. In operations we maintained commitment to lean management by tightening
control over material losses inventory and labor productivity. We continuously improved processing
techniques and made steady progress in standardizing process parameters across production lines.
9 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Under joint oversight from the quality assurance and production teams we achieved notable
improvements in key areas such as grinding mixing and pelleting efficiency along with higher pellet
durability and compliance rates. Collectively these efforts delivered tangible gains in cost efficiency and
overall operational performance.B. Navigating challenges through internal strength and external agility
During the reporting period China’s sow inventory began to recover from prior lows with the rebound
progressing notably faster in southern regions than northern regions. In the poultry sector production
capacity continued to grow after several consecutive years of expansion. However sluggish
consumption placed sustained pressure on prices across the value chain resulting in significant losses
for mid- and downstream operators. In the ruminant sector persistently low milk prices left regional
dairy producers in a difficult position while beef cattle farming remained structurally unprofitable. As a
result overall demand for ruminant feed declined sharply over the course of the year. To address these
market challenges our feed business adopted a dual-track strategy—reinforcing internal benchmarking
and service infrastructure to strengthen operational capabilities while actively expanding external
markets. We pursued both volume and profitability targets in parallel and formulated targeted
responsive strategies for different feed categories based on shifting market dynamics. In swine feed we
capitalized on improvements in sow reproduction and finishing (hog fattening) systems to accelerate
growth in our commercial feed business. Our frontline managers visited farms to learn about swine
farming gaining firsthand insight into procurement production and biosecurity practices to better
identify customer pain points and tailor service delivery. Drawing on our integrated swine farming
resources we strengthened service and marketing system enabling deeper long-term partnerships
with large-scale farm clients. In poultry feed the continued shift toward large-scale farming has driven
more diverse customer needs and a growing preference for contract and customized feed
manufacturing. We closely monitored client formulation habits and developed targeted market
segmentation strategies in response. These efforts enabled us to optimize technical support lower
operating costs ensure product integrity and quality consistency and steadily expand our bulk feed
delivery capacity to meet evolving customer expectations. In ruminant feed we took a research-led
approach carrying out deep market analysis and competitive benchmarking to support continuous
targeted improvements to our product range. At the same time we strengthened internal systems by
improving incentive design refining performance and compensation structures and tightening
recruitment and training standards. These efforts were key to building a professional high-caliber field
team capable of supporting customers through tough market conditions.
2. Broiler integration business
In 2024 China’s white-feather broiler industry further expanded its production capacity from an already
elevated base. However subdued macroeconomic conditions significantly constrained demand in mass
foodservice channels—the primary consumption scenario for white broilers. As a result the
10 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
incremental capacity was not efficiently absorbed placing sustained pressure on profitability across the
value chain. Mid- and downstream operators were hit the hardest: the commercial broiler farming
segment recorded substantial operating losses due to overcapacity the slaughtering and processing
segment operated at a slight loss and modest profitability was limited to upstream breeding
operations.A. Balancing volume and profit to steadily expand market share
During the reporting period we adhered to annual production plan maintaining disciplined output
scheduling despite a challenging industry environment. By accelerating turnover and balancing volume
with profitability we remained committed to maintaining cost leadership as a top priority while steadily
increasing our market share. On the breeder side in response to growing demand from the commercial
broiler farming segment we moderately expanded our breeding stock optimized stock introduction
and hatching schedules and progressively phased out outdated housing facilities. Existing breeder
farms and hatcheries were ramped up to reach full utilization as quickly as possible. In terms of farming
we continued to prioritize the development and retention of mid-level management talent with a
long-term focus on establishing a stable high-quality supply chain for live broilers to ensure consistent
volume and quality of broiler deliveries to the slaughtering and processing segment. Commercial broiler
farming capacity expanded steadily in line with downstream processing growth. In terms of
slaughtering and processing we leveraged our industry-leading operational efficiency and profitability
to support sustained growth in production and sales. Capacity utilization across the slaughtering and
processing segment remained consistently high. A new plant commissioned last year ramped up rapidly
and reached single-month profitability by June. During the reporting period our holding and associated
companies slaughtered approximately 920 million broilers representing a year-on-year increase of 14%.Total sales of broiler products reached 2.43 million tons up 15% from the previous year.B. Strengthening internal capabilities to enhance profitability
During the reporting period profit divergence within the white-feather broiler industry continued to
widen primarily due to varying levels of cost management capability among industry participants. In
response to intensifying market competition we reinforced our operational management and
implemented rigorous quality control measures aiming to strengthen competitive advantages and
drive sustained improvements in profitability. At the breeder level amid a general decline in breeder
stock quality across the industry we placed greater emphasis on genetic integrity. We maintained
long-term strategic partnerships with leading breeding suppliers and continued to refine our chick
source purification protocols and biosecurity systems to ensure the quality of day-old chicks. In farming
operations we continued to enhance management systems and upgrade automation with the goal of
developing modern large-scale white-feather broiler farms. During the year we further optimized feed
formulations refined feeding strategies and dynamically adjusted the compensation policies for
contract farms. As a result commercial broiler farming costs declined significantly year-on-year
11 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
accompanied by a marked improvement in overall production performance. In slaughtering and
processing operations we maintained commitment to a high-quality strategy. We rigorously enforced
standard operating procedures in the cut-up and deboning process and continuously enhanced
operator proficiency to deliver consistent product quality earning long-standing recognition in the
market. Meanwhile our market development capabilities continued to improve with an increasing
proportion of sales generated through high-value channels. This supported ongoing gains in product
premiums inventory turnover and overall business performance.
3. Swine farming business
After more than a year of industry-wide capacity reduction the swine sector entered 2024 with
improved fundamentals and more stable profitability. Capitalizing on this favorable backdrop we
accelerated the production scheduling optimized sales structure and strengthened on-farm
management to drive further improvements in operational performance. Supported by higher hog
prices and lower unit costs our swine farming business became profitable on a monthly basis starting
in March. Core operational capabilities improved significantly throughout the year. During the reporting
period we sold a total of 1.40 million hogs including 1.21 million finishers 160000 piglets and 30000
breeding pigs.A. Managing production rhythm and optimizing sales structure
In swine farming operations we adopted a development strategy focused on controlling production
scale and optimizing herd structure. Subsidiaries within the segment applied rational planning and
prudent management practices to keep total farming volume within a reasonable range. From 2021 to
2023 we took decisive action to phase out low-efficiency capacity and adopted a prudent approach to
capital expenditure enabling our swine farming business to navigate a prolonged industry downturn
with resilience. During this period we achieved steady improvements in asset quality operational
efficiency and production performance. In the first half of 2024 as supply and demand conditions in
China’s hog market gradually improved we moderately increased our sow inventory and actively
procured low-cost piglets ahead of the market upturn. In the third quarter hog prices rose sharply
reaching their annual peak and generating strong profitability. In response we significantly slowed
piglet procurement and moderately reduced sow inventory to manage downside risk in the event of
price corrections. In the fourth quarter hog prices declined amid increasing seasonal disease pressure.We responded by shortening the fattening cycle accelerating turnover and culling underperforming
sows in order to safeguard biosecurity. Overall during the favorable market cycle of 2024 we
maintained strategic discipline and made rational long-term-oriented decisions. Our swine farming
team continued to mature demonstrating stronger capabilities in market response and operational
execution.B. Strengthening management and building core operational capabilities
During the reporting period we identified the enhancement of core capabilities in our breeding pig
12 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
operations as a strategic priority. We conducted a systematic review across key areas including farm
site selection equipment specifications operational workflows production models genetic
management and biosecurity with the aim of addressing structural gaps and building core business
capabilities as soon as possible. From a management perspective our swine segment continued to
implement a process-based performance management practice. Monthly business review meetings
were held at the Group regional and subsidiary levels to identify farm-level issues through a
benchmarking approach defined by learning from external best practices and replicating internal
successes. Site-specific task lists were developed and progress was closely tracked with corrective
actions rigorously executed. In terms of talent development our swine segment accelerated the
recruitment of young technical and managerial talent while intensifying training for front-line and
mid-level farm managers. Through structured on-the-job development targeted mentoring and
hands-on guidance junior farm managers were supported in developing practical leadership
capabilities. In parallel regular talent reviews and enhanced performance assessments enabled
dynamic team optimization based on merit. These efforts were reinforced by a data-driven incentive
and compensation scheme which significantly strengthened initiative and accountability across farm
management teams.II. Industry Overview of the Company during the Reporting Period
1. Feed industry
In 2024 while China’s domestic economy showed signs of a gradual recovery consumer confidence in
meat products remained subdued. Prices of animal proteins—particularly beef and poultry—fell sharply
while pork consumption registered only modest growth. As a result the upstream feed industry
continued to face mounting pressure on profitability.On the supply side China’s total industrial feed output reached 315.03 million tons in 2024 marking a
2.1% decline compared to the previous year. Among the main feed categories swine feed production
totaled 143.91 million tons a year-on-year decrease of 3.9%; layer feed reached 32.36 million tons
down 1.2%; broiler feed increased to 97.54 million tons up 2.6%; ruminant feed declined sharply to
14.49 million tons a drop of 13.3% and aquatic feed stood at 22.62 million tons down 3.5% from a
year earlier. In terms of market concentration 34 feed enterprise groups recorded annual production
exceeding one million tons collectively accounting for 55.0% of the total national feed output. Of these
seven groups produced more than 10 million tons annually. In addition eleven individual production
facilities reported annual output above 500000 tons with the largest single plant reaching 1.331
million tons. In terms of sales model the total national volume of bulk feed reached 130.502 million
tons in 2024 representing a year-on-year increase of 10.7%. Bulk feed accounted for 49.2% of total
compound feed output up 5.5 percentage points from the previous year.In terms of demand within the swine feed segment hog production capacity began to recover from a
low base with the pace of recovery faster in the south than in the north. Despite this swine feed
13 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
demand declined year-on-year driven by the accelerated exit of small-scale backyard farms. This
structural shift increased the dominance of large-scale vertically integrated operations shrinking the
addressable market for commercial feed and intensifying competition in an already saturated landscape.In the poultry feed segment national layer inventories saw modest growth although a downward trend
persisted in Northeast China. Broiler production continued to rise from an already elevated level
however the feed-to-meat ratio declined significantly and as a result overall demand for poultry feed
did not see any notable increase. As for ruminant feed persistently low milk prices and mounting
operational pressure on regional dairy processors coupled with sustained losses in beef cattle farming
led to a sharp decline in ruminant feed demand over the year. Overall except for pork prices for most
meat products remained at subdued levels and the recovery in consumer demand for animal protein
was broadly sluggish.Amid intensifying market competition some regional producers turned to price cuts to improve
capacity utilization. Confronted with domestic overcapacity and softening demand leading Chinese
feed companies have turned to overseas markets for growth. Notably Chinese feed producers have
been rapidly gaining market share in Southeast Asia highlighting a clear strategic pivot toward
international growth in response to domestic headwinds.Source: China Feed Industry Association Statistical Report; Boyar Intelligence Industry Analysis Report.
2. Broiler industry
In 2024 white-feather broiler prices remained subdued with profitability varying significantly across
segments of the value chain. Upstream breeding operations remained profitable while commercial
broiler farming incurred heavy losses and the slaughtering segment ran at a slight deficit.On the supply side the population of active grandparent stock increased as imports of breeding stock
gradually resumed and domestic breeding lines underwent accelerated renewal parent stock also
stabilized and began to recover. However widespread forced molting and delayed culling practices led
to a further decline in the reproductive performance of parent stock. Combined with disease pressures
these factors reduced the supply of commercial chicks in the second half of the year causing chick
prices to rise year-on-year. In commercial broiler farming live bird supply was relatively sufficient in the
first half of the year exerting continued downward pressure on prices. In the third quarter farms
reduced chick placements to avoid high temperatures tightening live bird supply. Meanwhile global
avian influenza developments briefly pushed prices higher before they retreated. In the fourth quarter
live bird supply rose sharply but stronger downstream pricing sentiment supported a modest price
rebound. For the full year China’s broiler slaughter volume rose by 1.8% while production of broiler
cuts increased by 2.3%. However white-feather broiler prices fell year-on-year and the farming
segment remained deeply unprofitable.On the demand side consumer demand for white-feather broilers recovered relatively slowly. Demand
from institutional catering channels—such as corporate cafeterias and factory meal services—remained
14 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
weak and product movement in the foodservice and food manufacturing sectors was sluggish.Household consumption accounted for only a small share. Overall market demand for chicken
remained subdued with narrowed product margins. Distributors were generally reluctant to place new
orders which shifted inventory pressure upstream to slaughterhouses. This led to slower product
circulation a decline in slaughterhouse operating rates and continued downward pressure on selling
prices. Although pork prices rose sharply and substitution-driven demand for chicken improved it
remained insufficient to absorb the surplus broiler supply. Broiler cut prices trended downward through
the first half of the year rebounded briefly in Q3 and softened again in Q4. Although producers
increasingly resisted further price declines toward the year-end these efforts failed to meaningfully lift
the market. The annual average price settled at RMB 9450 per ton marking a 12.17% decline
year-on-year. The slaughtering segment remained broadly unprofitable with profitability varying
significantly across enterprises—reflecting divergent cost structures and management capabilities.In summary China’s white-feather broiler market in 2024 was marked by ample supply and weak
demand. Prices remained subdued throughout the year while performance disparities widened—both
across segments of the value chain and among players within the same segment.Source: Boyar Intelligence Industry Analysis Report.
3. Swine farming industry
In 2024 China’s swine farming sector began to recover with prices following a rise-then-fall pattern.Amid elevated average hog prices and a sharp drop in feed costs producers recorded their strongest
profitability in recent years.On the supply side capacity reductions throughout 2023 coupled with widespread disease outbreaks
in northern China during Q4 led to substantial losses in sow inventories and constrained restocking
efforts. By early 2024 the market had shifted toward a tighter supply environment. As piglet and hog
prices climbed in the first half of the year farming profitability improved markedly prompting breeding
sow inventories to bottom out and rebound from May onward. Boosted by opportunistic secondary
fattening activity stronger market sentiment and expectations of a supply gap hog prices peaked in Q3.However as sow inventories continued to recover and the supply gap narrowed hog prices came under
further pressure from a surge of secondary fattening hogs reaching slaughter weight and began
trending lower in Q4. For the full year China’s total hog slaughter volume declined by 3.3% year-on-year
pork production fell by 1.5% and the average hog price recorded a year-on-year increase.On the demand side pork consumption remained subdued constrained by slower income growth
intensifying competition from alternative proteins and continued destocking of frozen inventories.While foodservice demand showed a mild recovery overall pork consumption was still driven primarily
by households. In contrast outdoor catering consumption has increasingly shifted toward alternatives
such as chicken beef and lamb. With substitute meat prices falling and hog prices rising pork lost price
competitiveness—further weighing on demand. At the same time sustained losses in the slaughtering
15 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
segment elevated procurement costs and high frozen inventory levels exacerbated financial strain on
processors driving slaughter activity to multi-period lows. Overall demand remained soft throughout
2024 and the sharp price rally in the second half ultimately lacked downstream support triggering a
market correction. Due to a sharp drop in feed ingredient prices production costs declined significantly
making 2024 the most profitable year for hog farming in the past three years. However large-scale
producers remained cautious about expanding capacity placing greater emphasis on cost control and
operational efficiency. As price expectations adjusted more rapidly and market corrections became
more frequent hog price volatility narrowed making cost management an increasingly critical lever for
sustaining margins.In addition following the failure to contain African Swine Fever outbreaks in northern China a
structural shift has begun to take shape: sows are increasingly relocated to southern regions while
piglets are sent northward for finishing. The scale and specialization of secondary fattening operations
have expanded rapidly. Looking ahead China’s hog industry is expected to accelerate its transition
toward larger-scale more specialized and increasingly integrated production systems.Source: The Ministry of Agriculture and Rural Affairs of China the National Bureau of Statistics and Boyar Intelligence
Industry Analysis Report.III. Circumstance of Primary Businesses in the Reporting Period
Wellhope is a well-recognized large-scale enterprise in China’s agriculture and livestock sector. Its core
businesses include animal feed production feed raw material trading integrated broiler operations
and swine farming. The Company also operates in veterinary pharmaceuticals farming equipment
manufacturing and pet healthcare. In 2018 Wellhope identified food as a strategic development area.Since its founding Wellhope has remained committed to its corporate mission: “Through advancedtechnology professional service and high-quality products Wellhope is dedicated to advancing China’s
animal husbandry industry conserving resources protecting the environment and ensuring food safetyfor the benefit of society.” United by a shared vision Wellhope’s teams collaborate across sectors to
achieve the Company's long-term goal of becoming a world-leading enterprise in agriculture livestock
and food industries.During the reporting period there were no significant changes in the Company’s core business
operations. Details are as follows:
Primary business Primary products Operation model
Sales model-Distribution and direct sales
Swine poultry ruminant
Feed Operation model-R&D purchasing production
aquatic feed
sales service
Industrial chain-covers the full value chain
including broiler breeding hatching feed
Broiler Live broiler broiler parts production commercial broiler farming broiler
integration products slaughtering and processing and further processing
of prepared and cooked products
Farming model of commercial broiler - the
16 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Company together with large-scale contract farms
Industrial chain-covering a complete breeding
system including great grandparent grandparent
Swine farming Finisher piglet breeding pig and parent stock piglet and market hogs
Farming model of finisher - contract farms and a
small number of company-owned farms
1. Animal feed feed raw materials trade businesses
Wellhope produces and markets feed products for pigs poultry ruminants aquatic animals and
fur-bearing animals with distribution across 32 provinces and regions in China. The Company has also
established feed mills in countries such as Nepal Indonesia and the Philippines. Guided by the
philosophy of continuous innovation and rejecting stagnation Wellhope customizes feed formulations
to different growth stages of animals and provides farmers with integrated solutions that include
animal husbandry support disease prevention and farm management services — all aimed at helping
customers achieve optimal economic returns.The Company’s trading subsidiaries primarily deal in feed raw materials such as fishmeal soybean meal
and corn by-products as well as feed additives including amino acids antioxidants mold inhibitors and
vitamins. In addition they act as distributors for animal health products — such as vaccines and
veterinary medicines — sourced through strategic partnerships with leading multinational companies.The trading business operates across regions including Northeast North East South and Southwest
China and select products are exported to countries such as Nepal and Mongolia.
2. Broiler integration business
The entities of Wellhope’s broiler integration business are primarily located in the three northeastern
provinces—Liaoning Jilin and Heilongjiang—as well as in Hebei Henan and Shandong. The business is
structured around three core segments: farming processing and further processing. The fully
integrated value chain encompasses parent stock breeding day-old chick hatching feed production
commercial broiler rearing slaughtering and raw meat processing along with the further processing of
prepared and cooked products. This integrated model ensures a stable supply of raw materials across
all stages and applies strict controls throughout the entire process—from feed production and broiler
farming to slaughtering and meat processing. Biosafety drug residue control and hygiene management
are seamlessly integrated through standardized procedures and process-oriented operations enabling
full traceability and reinforcing food safety. Wellhope’s broiler business has expanded rapidly in recent
years with significant growth in both production capacity and operational scale becoming a pivotal
industry leader in China’s white-feather broiler sector.Wellhope’s broiler industry chain sees as follows:
17 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
◆ Broiler raising: Wellhope’s broiler farming segment covers parent stock breeding hatching
commercial broiler rearing and feed production. The Company formulates scientifically designed
feeding protocols lighting programs and comprehensive biosecurity plans for parent stock to ensure
the consistent supply of high-quality hatching eggs. At the hatchery level Wellhope has established a
robust production management system and adopted intelligent hatching equipment including
high-efficiency energy-saving hatchers and advanced environmental control systems to produce
healthy day-old chicks for commercial rearing. Wellhope adopts a contract farming model working with
large-scale farms under unified standards and centralized management. All partner farms employ
three-tier cage systems with full automation across feed delivery water supply temperature and
humidity control. The average live weight of broilers reaches 2.9–3.0 kg with a livability rate of 96–97%
a feed conversion ratio of 1.44–1.48 and a European Performance Index of 450–460 performance
levels have been widely recognized across its farming network.◆Raw meat processing: Wellhope holds equity in 20 slaughtering enterprises(including both holding
and associated entities) with an annual capacity exceeding 1.1 billion broilers. These facilities utilize
advanced automated poultry processing lines sourced domestically and operate under rigorous
protocols for entry-exit inspection quarantine and drug residue testing forming a comprehensive
quality assurance and traceability system. The Company continuously enhances slaughtering and
processing efficiency through systematic pre-job and on-the-job training programs paired with 6S lean
management practices (Seiri Seiton Seiso Seiketsu Shitsuke Safety). As a result its yield rate and
labor productivity rank among the highest in the industry for comparable-sized companies. Wellhope’s
broiler parts products are widely distributed to leading clients such as Shineway Group Jinluo Group
Yurun Group McDonald’s KFC Yoshinoya Wallace Dili Fresh Yonghui Superstores RT-Mart as well as
regional foodservice companies fresh markets and food processors. In addition to domestic sales
products are also exported to Hong Kong Macau and countries including Mongolia Bahrain and
Russia.
18 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
◆Further processing: Leveraging the advantages of vertical integration Wellhope uses high-quality
chicken from its own slaughtering facilities as raw material and has introduced energy-efficient modern
processing equipment to support deep processing operations. The Company currently offers over 100
types of cooked and prepared products which are mainly distributed through offline channels to
restaurant chain central kitchens corporate and school cafeterias supermarkets and convenience
stores. In response to continuously upgrading consumer demand Wellhope has also actively expanded
its export business in ready-to-eat foods with cooked products already gaining strong traction in
markets such as Japan and South Korea.
3. Swine farming business
Wellhope began exploring the swine farming business in 2016 and formally identified it as a strategic
business in 2018. Since then the Company has established operations in Liaoning Jilin Heilongjiang
(three provinces of Northeast China) Inner Mongolia Henan Hebei and Anhui through self-built
joint-venture and leased facilities. Currently Wellhope’s swine business primarily encompasses
breeding pig production and sales commercial piglet sales hog fattening (primarily through contract
farming with a small number of company-owned farms) and hog slaughtering. By establishing
comprehensive and rigorous biosecurity systems advanced breeding platforms and science-based
feeding and farm management protocols Wellhope is committed to building an integrated swine value
chain covering breeding farming slaughtering and processing.A. High-standard farm construction
Wellhope adheres to the principle of reasonable effective and moderate scale for individual farms
with appropriately configured facilities and equipment. Each site is designed with a robust biosecurity
system guided by long-term disease prevention and whole-process risk control. Advanced production
technologies are integrated with intelligent feeding systems environmental control equipment and
digital management platforms — all aimed at improving operational efficiency and ensuring a healthy
comfortable environment for swine.B. All-round system operation
a. Genetics and breeding: Wellhope introduces high-quality French American and Danish breed
breeding pigs to match different business regions aiming to breed and provide pure-bred
pedigree-clear breeding pigs. It also establishes scientific breeding and selection programs and
conducts systematic platform-based breeding efforts to continuously optimize herd structure maintain
19 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
its own genetic advantages and enhance its competitiveness in swine farming.b. Feeding management: The Company has established a dynamic and efficient full cycle feeding
management system for swine which includes databases for feed nutrition and raw materials feed
production and product quality and farming performance. Combined with dynamic nutritional
formulation technology feeding management technology for large-scale farms and biosecurity
technology it provides systematic nutrition and feeding management solutions for pig farms.Meanwhile through continuous data collection and analysis result tracking it achieves precise
optimization of nutrition solutions internal refined management and risk early warning to enhance
farming performance.c. Biosecurity management: Wellhope has built a comprehensive biosecurity system incorporating
small-batch compartmentalized feeding four-zone access control three-level disinfection protocol
precise pathogen detection and real-time surveillance with automated alerts. Externally farms are
supported by multi-tiered safety systems including designated service centers and external disinfection
zones where professional staff disinfect personnel vehicles and materials step by step. Internally each
farm is divided into security zones based on isolation and quarantine protocols with AI-based
identification and camera systems installed at key control points to monitor compliance. Visualized
management ensures that biosecurity protocols are enforced in real time. Each operational region is
also equipped with dedicated African Swine Fever (ASF) testing laboratories. Using technologies such as
quantitative PCR these labs enable accurate detection rapid response and targeted culling to protect
herd health and farm biosecurity.
4. The Company's industry position
Wellhope has received numerous national-level honors including designation as a National Key Leading
Enterprise in Agricultural Industrialization a Nationally Certified Enterprise Technology Center and a
National High-Tech Enterprise. Since its IPO in 2014 Wellhope has been named four times among the
Top 100 Most Valuable A-Share Listed Companies in China and was recognized as one of the Top 10
Internationalized Brands in China’s Livestock and Feed Industry (2022–2023). In 2024 the Company was
listed for the eighth time on the Fortune China 500. Wellhope holds a leading position in Northeast
China and maintains a strong brand presence in Northwest North and Central China. In the feed sector
Wellhope is a Vice President Member of the China Feed Industry Association and has been recognized
among China’s Top 10 Leading Feed Enterprises. It consistently ranks among the top in national
commercial feed sales and was ranked 17th globally on the WATT Global Media Top Feed Companies
List in 2024. In the broiler sector Wellhope’s white-feather broiler business has grown rapidly in recent
years with significant expansion in integrated capacity and overall production scale. As a result
Wellhope has become a leading player in China’s white broiler industry. Based on the slaughtering and
processing volume of its holding and associated enterprises the Company was ranked 7th globally on
the 2024 WATT Global Top Broiler Producers List.
20 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
IV. Core Competence Analysis within the Reporting Period
The core competencies of Wellhope are reflected in a highly capable loyal and entrepreneurial
management team; a strategy of disciplined planning and steady growth; a mature and well-developed
industrial footprint; a systematic scientific and continuously innovative R&D system; a broadening and
deepening brand influence; and a cohesive empowering corporate culture that aligns and drives the
organization forward. Together these strengths form the foundation of Wellhope’s long-term
competitiveness and sustainable development.
1. A highly capable loyal and entrepreneurial management team
Talent is Wellhope’s most valuable asset and the cornerstone of its long-term competitiveness. The
Company’s management team consists of multiple tiers of internal shareholders highly educated
experienced professionals with deep industry expertise and strong strategic vision. Equally important
they share a deep alignment with Wellhope’s core values and corporate culture. Most of the Company’s
middle and senior managers have advanced through structured internal development and promotion
pathways supported by a comprehensive incentive system. They consistently demonstrate strong
ownership accountability and long-term commitment to the organization. Over the past three decades
the management team has exhibited exceptional stability. Turnover at the general manager’s level and
above has been extremely rare typically occurring only due to performance-related adjustments. A
new generation of leaders—born in the 1980s and 1990s—is now taking on key roles within the
organization. Selected through rigorous internal development programs such as the “Seedling Plan” and
the “Sunflower Program” these ambitious and forward-thinking individuals have become the backbone
of Wellhope’s next-generation leadership. Wellhope places strong emphasis on continuous leadership
development. Mid- and senior-level managers regularly participate in structured training programs
including the Executive Development Program (EDP) and Leadership Training Camp. The Company also
organizes benchmarking visits to top-performing domestic and international companies helping
managers broaden their perspectives and sharpen their leadership capabilities. While many local
companies struggle with leadership turnover or lack of cohesion at the top Wellhope’s loyal capable
and future-oriented management team remains one of its most enduring competitive advantages and
a key source of confidence in the Company’s steady progress and sustainable future.
2. A strategy of disciplined planning and steady growth
Wellhope formulates its business strategy with a long-term mindset grounded in deep insight into both
domestic and global political economic and industry dynamics. The Company consistently prioritizes
sustainable growth and risk management focusing on operational efficiency and returns from both
new and existing projects. Guided by the principles of steady expansion and sound development
Wellhope takes a measured step-by-step approach to strategic deployment maintains structural
balance and risk resilience across its operations and remains firmly committed to building a business
that stands the test of time.
21 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
This philosophy is reflected in four key areas:
A. Prudent expansion into new business areas: Wellhope began with premix production and has grown
into one of China’s top 10 commercial feed producers through years of focused investment in the feed
industry. In 2008 following careful evaluation the Company entered the broiler integration sector.After 17 years of dedicated development Wellhope’s holding and associated companies now rank 7th
globally in broiler processing volume with management and technical capabilities rank among the best
domestically and internationally. In 2018 to capture growth opportunities and mitigate sector-specific
risks the Company made a strategic entry into the swine farming business. Through a combination of
wholly owned projects and strategic partnerships Wellhope has rapidly developed its core capabilities
in this segment. From 2023 to 2025 the Company will continue to strengthen its two strategic core
businesses—feed and broiler integration—while accelerating two strategic growth areas: swine farming
and food processing. Wellhope aims to gradually establish regional food brands and become a leading
enterprise setting benchmarks in safety quality cost efficiency and operational excellence across the
agriculture livestock and food industries.B. A forward-looking integrated business model: Wellhope has developed a resilient and synergistic
value chain that spans raw material trading feed production breeding farming animal health products
slaughtering and further food processing. This vertically integrated model ensures strong connectivity
across segments reduces intermediaries lowers transaction risks cushions against market volatility
expands profit margins and enhances food safety. In an increasingly complex economic and industry
environment this model offers a robust and future-ready framework for modern agribusiness
development.C. Deliberated and phased market expansion: Despite its strong performance in feed and broiler
integration in Northeast China Wellhope has never pursued rapid nationwide expansion. Instead the
Company follows a research-driven disciplined approach—gradually extending its footprint into
Northwest North Central China the Shandong region and Eastern regions. In new markets Wellhope
emphasizes asset-light expansion and remains focused on operational efficiency and investment
returns.D. Rigorous financial risk management: Wellhope places great importance on financial prudence and
internal control. Since its IPO the Company has continuously improved its risk management framework
and corporate governance practices. It operates a vertically managed centralized financial system
covering financing credit capital allocation and guarantee approvals. In alignment with
macroeconomic conditions industry trends and its own business performance Wellhope carefully
controls leverage and financing costs. As of the end of the reporting period the Company’s
asset-liability ratio remained at a sound level of 49.09%.
3. A mature and highly developed industrial footprint
Wellhope’s industrial footprint reflects both strategic geographic positioning and a continuously
22 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
optimized business structure. These strengths serve as key enablers of efficiency cost control and
long-term competitiveness.A. Strategic geographic positioning: Headquartered in Shenyang Liaoning Province Wellhope maintains
a strong operational presence across northern China with a particular focus on the northeastern region.Designated by national policy as a key growth area for livestock production Northeast China offers
abundant raw materials a favorable climate low stocking density and relatively low labor
costs—making it highly conducive to the development of agriculture and animal husbandry. The region
is also China’s largest grain-producing base particularly for corn and rice with advantages in both
quality and volume. Its well-developed grain processing sector provides a wide range of cost-effective
feed ingredients and by-products with efficient logistics networks. Since the introduction of national
rice auction mechanisms the Northeast has gained unique cost advantages in supply. For example the
inclusion of brown rice in feed formulations has helped mitigate the impact of rising corn prices on
overall feed costs. Wellhope’s broiler operations are primarily located in Liaoning Jilin Henan Hebei
and Shandong—regions collectively representing over 75% of China’s total broiler production. These
areas not only offer a strong foundation for poultry farming but also feature mature downstream
market infrastructure. In both poultry and swine operations Wellhope adopts a regional cluster-based
development model: concentrating resources in key industrial zones building localized scale and
enhancing operational efficiency while reducing logistics costs.In parallel the Company is actively expanding into international markets with significant potential for
livestock development. It has established feed production facilities in countries such as the Philippines
Indonesia and Nepal laying a foundation for long-term global growth.B. Continuously optimized business structure: Wellhope’s development strategy is rooted in agriculture
and animal husbandry and guided by a dual approach of horizontal diversification and vertical
integration. This model continues to strengthen the Company’s risk resilience and capacity for
sustainable profitability. Horizontally Wellhope is scaling up its feed business while accelerating the
growth of its broiler segment with the ambition to achieve both domestic and global leadership. At the
same time the Company is steadily strengthening its hog farming operations to achieve regional
leadership in selected markets. Vertically the Company has built a robust fully integrated value chain
covering raw material trading feed production animal farming slaughtering and further processing.This integrated model reflects a long-term strategic direction for China’s agri-livestock and food industry.Looking ahead Wellhope will continue to strengthen coordination across all segments of the
chain—deepening synergies expanding into food processing and accelerating the development of a
closed-loop end-to-end supply chain. These efforts are further supported by the ongoing
standardization and optimization of internal division of labor and cross-segment collaboration ensuring
long-term cohesion scalability and operational excellence.
4. A systematic scientific and continuously innovative R&D system
23 / 263Wellhope Foods Co. Ltd. 2024 Annual ReportGuided by its mission — “Through advanced technology professional services and high-qualityproducts Wellhope is devoted to the development of China’s animal husbandry industry resourceconservation environmental protection and food safety for the benefit of society” the Company has
established an R&D system that is both customer-oriented and market-driven. Wellhope remains
focused on product safety quality consistency precise nutrition and customer-centered services while
continuously pursuing technological innovation and new product development. Through a distinctive
collaboration model a dedicated and highly capable technical team and a three-tier structure centered
on the Wellhope Research Institute the Company has built a comprehensive framework for efficient
research and rapid application. This system is further supported by top-tier testing capabilities a
dynamic and precise raw material database a well-balanced product portfolio and an ever-improving
technical service infrastructure.A. Strong and specialized R&D team: Leveraging its complete industrial chain Wellhope has
established an integrated R&D team covering feed formulation farming technologies and processing
innovations across key business segments including feed broiler integration swine farming and
biological feed additives. Comprising hundreds of experts including PhDs master's graduates
professors and senior technical personnel the team excels at both theoretical research and practical
applications. Senior experts provide strategic guidance in translating cutting-edge technologies into
real-world solutions while experienced technicians based on on-site realities conduct trials and
demonstration projects to validate and implement the most suitable technologies. Backed by its
technical capabilities Wellhope has received multiple national and provincial-level accreditations and
honors including Nationally Certified Enterprise Technology Center National and Local Joint
Engineering Research Center for the Development and Application of New Biological Feed National
Feed Processing Sub-Center under the National Agri-Product Processing System Comprehensive Trial
Station of the National Swine Industry Technology System Liaoning Province R&D Center for Deep
Agricultural Processing and Biopharmaceutical Industry Cluster Innovation Team for Feed Technology
and Safety in Liaoning Province.B. Competitive R&D collaborations: Since 2006 Wellhope has maintained a long-standing partnership
with Royal De Heus a century-old Dutch company. By drawing on De Heus’s globally advanced
technologies leading nutritional expertise and proven management practices Wellhope has achieved
major breakthroughs in safe high-quality efficient and antibiotic-free feed formulation. The R&D
teams from both companies engage in regular exchanges enabling Wellhope to remain aligned with
the world’s latest technological advancements. Building on nearly 30 years of its own experience
Wellhope continues to integrate global innovations with local farming realities delivering superior
products and technical services. The Company also partners closely with leading universities and
research institutions—including China Agricultural University Nanjing Agricultural University Shenyang
Agricultural University Northeast Agricultural University Hefei University of Technology and Anhui
24 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Agricultural University—to co-develop feed and meat processing technologies and jointly train
professional talent.C. World-class testing capability and data infrastructure: Wellhope’s central laboratory is one of the few
CNAS-accredited labs among domestic feed producers with testing results recognized in over 60
countries and regions. Equipped with state-of-the-art instruments the lab is organized into three
divisions: physical and chemical testing microbiological testing and precision instrument analysis.From raw materials to finished products the lab ensures consistent quality and enforces the Company’s
safety-first philosophy throughout the entire production process. The Company has also developed a
continuously updated internal raw material database and shares data resources with its Dutch partner.Its precision formulation tools include accurate databases for net energy (for sows and growing pigs)
amino acids crude fiber fatty acids and more—enabling precise diet formulation based on
performance targets and feed intake to achieve optimal cost-effectiveness.D. Innovation Achievements: R&D serves as a core driver of Wellhope’s long-term growth. Over the
years the Company has built a strong portfolio of innovative results. As of the end of the reporting
period Wellhope held 78 invention patents and was honored with two National Science and
Technology Progress Awards one National Technology Invention Award one First Prize of the Harvest
Award and nearly 20 provincial and ministerial-level science and technology awards.
5. A broadening and deepening brand influence
Over the past 30 years Wellhope has successfully established both a product brand and a corporate
brand within China’s agriculture and livestock sector. As the industry continues to evolve and upgrade
the influence of the Wellhope brand is expected to grow further.A. Product brand: Driven by advanced technologies high-quality products and a continually improving
service system the Wellhope brand has earned broad recognition and trust in its core markets
particularly across northern China where its influence is most prominent. The Company has received
numerous honors including the Famous Brand of Liaoning Province Well-Known Trademark of China
China’s Top 500 Most Valuable Trademarks the Most Influential Brand in China’s Livestock Industry the
Trusted Product in China’s Feed Industry and the Governor’s Quality Award of Liaoning Province.B. Corporate brand: Wellhope consistently upholds its core values of integrity responsibility and
mutual success. Many of the Company’s business segments are structured as long-term joint ventures
with trusted partners some lasting over a decade or even two. Notably the 19-year strategic
partnership with Royal De Heus of the Netherlands stands as a hallmark of enduring global
collaboration. In addition Wellhope maintains long-standing and amicable partnerships with numerous
multinational and domestic suppliers. These successful partnerships fully demonstrate the acceptance
and recognition of the Wellhope corporate brand among its partners. As an employer brand Wellhope
is also widely recognized and respected. It has been named the Best Employer three times by
Zhaopin.com and in 2022 received the award of Top 10 Employer Brand in China’s Livestock and Feed
25 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Industry reflecting its reputation as an ideal workplace among job seekers and employees alike.C. Brand extension: As Wellhope continues to expand its broiler and hog businesses and advances its
horizontal diversification and vertical integration strategy its market share and reputation have grown
across a wide range of sectors including raw material trading animal health breeding farming fresh
meat and ready-to-eat products. To protect the core value of the Wellhope brand and ensure
consistency across business lines the Company has adopted a disciplined approach to brand extension.Rather than applying the master brand indiscriminately Wellhope builds vertical brand equity in
targeted sectors where business maturity product quality and long-term value can be fully supported.This strategy not only enhances brand influence within the industry but also increases the added value
of individual business units.
6. A cohesive and empowering corporate culture that aligns and drives the organization forward
Over the past 30 years Wellhope has cultivated a corporate culture that emphasizes shared purpose
top-down alignment and collective empowerment. Its core values—integrity responsibility and mutual
success—along with an operational culture centered on innovation efficiency and self-discipline are
deeply embedded in the organization. These values shape behavior and are reflected in every aspect of
the business—from talent selection and strategy development to daily decision-making and
management execution.In 2024 cultural development remained closely aligned with business priorities supporting the
development of large-scale farms in the feed business while accelerating cultural integration in the
swine and broiler operations. One key initiative was the company-wide Innovation & Efficiency
Competition focused on reducing costs and improving performance. A record 98 projects were
submitted across four categories with 31 reaching the finals. Employees were encouraged to
contribute practical ideas from their daily work transforming values into action and innovation into
habit. In September 2023 the Company launched a group-wide learning initiative based on The Ten
Precepts of Taiichi Ohno. Business units and functional teams studied discussed and applied lean
thinking in their operations. In June 2024 a final review and evaluation event was held to assess results
and recognize progress in cost control and performance improvement. Also in 2024 Wellhope hosted
three types of employee skill competitions covering broiler processing feed pelleting and hog fattening
to engage front-line teams and recognize high-performing individuals. The Group also organized the
“Wellhope Cup” basketball tournament to promote teamwork perseverance and pride among
employees. Meanwhile the Company continued to promote subcultures that reinforce execution and
alignment including process-based performance excellence benchmarking disciplined execution and a
culture of constructive feedback and self-criticism. These subcultures have become effective
mechanisms for driving strategy implementation across the organization.Wellhope’s 30-year journey has clearly demonstrated that corporate culture is a strategic moat for the
Company’s development. Strengthening this culture remains a long-term high-priority initiative that
26 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
will continue to support sustainable growth and organizational cohesion.V. Operations during the reporting period
During the reporting period the Company recorded revenue of RMB 32.545 billion representing a
year-on-year decrease of 9.52%. Net profit attributable to shareholders of the Company reached RMB
342 million up 174.93% year-on-year. Net profit attributable to shareholders after deducting
non-recurring gains and losses reached RMB 349 million marking a year-on-year increase of 169.47%.
1. Analysis of primary business
A. Analysis of changes of income and cash flow
RMB
Item 2024 2023 Change %
Revenue 32545260037.87 35970261909.41 -9.52
Costs of revenue 30447129165.17 34540124263.81 -11.85
Sales expenses 709944370.21 718365669.03 -1.17
Administrative expenses 672530023.01 614800562.62 9.39
Financial expenses 168191270.31 171600672.91 -1.99
R&D expenses 29041137.57 83797469.99 -65.34
Net cash flow from operating
activities 1176900496.53 956152750.32 23.09
Net cash flow from investing
-11.27
activities -448278145.58 -402864641.04
Net cash flow from financing
activities -877353019.52 -308196369.71
-184.67
Explanation of the above changes.Revenue: The decrease was primarily due to year-on-year declines in feed sales volume feed prices and
chicken prices.Cost of revenue: The decrease was mainly attributable to lower feed sales volume and a drop in the
prices of key feed raw materials resulting in a corresponding decline in feed production costs.Administrative expenses: The increase was primarily due to higher employee compensation and
depreciation expenses during the reporting period.R&D expenses: The decrease was mainly the result of fewer R&D projects carried out during the
reporting period.Net cash flow from operating activities: The increase was mainly due to a reduction in cash payments
for goods and services.Net cash flow from investing activities: The decrease was primarily due to lower cash received from
investment income and reduced proceeds from the disposal of fixed assets intangible assets and other
long-term assets.Net cash flow from financing activities: The decrease was mainly attributable to an increase in debt
repayments during the reporting period.
27 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B. Analysis of revenue and cost
During the reporting period the Company recorded revenue of RMB 32.545 billion representing a
year-on-year decrease of 9.52%. The cost of revenue amounted to RMB 30.447 billion down 11.85%
year-on-year.a. Breakdown of revenue by segment product region and sales channel
RMB
Analyzed by segment
Revenue Cost Gross margin
Gross
Segment Revenue Cost of revenue fluctuation fluctuation fluctuation
margin %
YoY % YoY % YoY %
Increased by
2.21
Feed 12509047052.89 11178618301.03 10.64 -24.05 -25.89
percentage
points
Increased by
Broiler 2.19
11339656046.8611020455472.072.811.14-1.09
integration percentage
points
Decreased by
Raw
3.29
materials 4999646088.08 5026504887.50 -0.54 -5.66 -2.46
percentage
trading
points
Increased by
Swine 21.20
3317621699.202920495993.1211.9728.793.80
farming percentage
points
Increased by
Other 5.08
333086724.17264635654.9720.55-9.05-14.52
businesses percentage
points
Analyzed by product
Revenue Cost Gross margin
Gross
Product Revenue Cost of revenue fluctuation fluctuation fluctuation
margin %
YoY % YoY % YoY %
Increased by
2.21
Feed 12509047052.89 11178618301.03 10.64 -24.05 -25.89
percentage
points
Increased by
Broiler 2.19
11339656046.8611020455472.072.811.14-1.09
integration percentage
points
Decreased by
Raw
3.29
materials 4999646088.08 5026504887.50 -0.54 -5.66 -2.46
percentage
trading
points
Increased by
Swine 21.20
3317621699.202920495993.1211.9728.793.80
farming percentage
points
Increased by
Other 5.08
333086724.17264635654.9720.55-9.05-14.52
businesses percentage
points
Analyzed by region
Revenue Cost Gross margin
Gross
Region Revenue Cost of revenue fluctuation fluctuation fluctuation
margin %
YoY % YoY % YoY %
28 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Increased by
2.22
East China 4741206164.09 4547268332.46 4.09 -11.46 -13.46
percentage
points
Increased by
North 3.49
4381552292.384083402751.796.80-3.76-7.24
China percentage
points
Increased by
Northeast 2.35
15776348142.9214688456371.566.90-9.51-11.74
China percentage
points
Increased by
Central and
3.02
South 5438888818.56 5085550928.24 6.50 -13.60 -16.30
percentage
China
points
Decreased by
Southwest 1.02
602515942.82585357067.902.85-13.25-12.33
China percentage
points
Increased by
Northwest 1.05
1007781334.39904021828.7210.30-14.42-15.41
China percentage
points
Increased by
Overseas 0.18
550764916.06516653028.036.1932.8432.58
market percentage
points
Analyzed by sales channel
Revenue Cost Gross margin
Sales Gross
Revenue Cost of revenue fluctuation fluctuation fluctuation
channel margin %
YoY % YoY % YoY %
Increased by
2.54
Direct sales 23645286456.61 22117077625.98 6.46 -0.30 -2.93
percentage
points
Increased by
Distributor 2.31
8853771154.608293632682.726.33-27.47-29.21
sales percentage
points
b. Analysis of sales volume
Production
Sales volume Inventory
Production volume Sales volume Inventory volume
Product fluctuation fluctuation
(10000 tons) (10000 tons) (10000 tons) fluctuation
YoY % YoY %
YoY %
Feed 531.94 396.18 5.50 1.57 -7.98 -32.68
Explanation: Sales of feed products are external sales and do not include sales for internal use.c. Analysis of cost
RMB
% of
% of total Fluctuation
By Industry Item 2024 2023 total
costs YoY %
costs
Feed Raw materials 9934436780.88 94.35 13760282630.25 95.71 -27.80
Feed Labor costs 173184097.12 1.64 178359637.62 1.24 -2.90
Feed Depreciation 143890233.53 1.37 134483142.61 0.94 6.99
Energy (electricity
Feed 159474147.12 1.51 172821323.26 1.20 -7.72
coal steam)
29 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Other
manufacturing
Feed expenses (excluding 118427413.36 1.12 131452494.49 0.91 -9.91
energy and
depreciation)
Total production
Feed 10529412672.01 100.00 14377399228.24 100.00 -26.76
cost
Broiler Raw material 9258588070.50 85.02 9136127364.54 82.67 1.34
Broiler Labor cost 577534915.23 5.30 515755275.59 4.67 11.98
Broiler Depreciation 85263486.93 0.78 80174895.32 0.73 6.35
Energy (electricity
Broiler 105303466.83 0.97 118275580.27 1.07 -10.97
coal steam)
Other
manufacturing
Broiler expenses (excluding 863002228.40 7.92 1200822494.66 10.87 -28.13
energy and
depreciation)
Total production
Broiler 10889692167.89 100.00 11051155610.38 100.00 -1.46
cost
% of
% of total Fluctuation
By Product Item 2024 2023 total
costs YoY %
costs
Feed Raw materials 9934436780.88 94.35 13760282630.25 95.71 -27.80
Feed Labor costs 173184097.12 1.64 178359637.62 1.24 -2.90
Feed Depreciation 143890233.53 1.37 134483142.61 0.94 6.99
Energy (electricity
Feed 159474147.12 1.51 172821323.26 1.20 -7.72
coal steam)
Other
manufacturing
Feed expenses (excluding 118427413.36 1.12 131452494.49 0.91 -9.91
energy and
depreciation)
Total production
Feed 10529412672.01 100.00 14377399228.24 100.00 -26.76
cost
Broiler Raw material 9258588070.50 85.02 9136127364.54 82.67 1.34
Broiler Labor cost 577534915.23 5.30 515755275.59 4.67 11.98
Broiler Depreciation 85263486.93 0.78 80174895.32 0.73 6.35
Energy (electricity
Broiler 105303466.83 0.97 118275580.27 1.07 -10.97
coal steam)
Other
manufacturing
Broiler expenses (excluding 863002228.40 7.92 1200822494.66 10.87 -28.13
energy and
depreciation)
Total production
Broiler 10889692167.89 100.00 11051155610.38 100.00 -1.46
cost
d. Top 5 customers and suppliers
d-1: Major customers
The total sales to the top five customers amounted to RMB 1036.25 million accounting for 3.18% of
the annual revenue. Among them sales to related parties totaled RMB 189.45 million representing
0.58% of the annual revenue.
d-2: Major suppliers
The total purchases from the top five suppliers amounted to RMB 5791.39 million accounting for
19.02% of the annual total procurement. There were no purchases from related parties.
30 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
C. Expense
RMB
Item 2024 2023 Change %
Sales expense 709944370.21 718365669.03 -1.17
Administrative expense 672530023.01 614800562.62 9.39
R&D expense 29041137.57 83797469.99 -65.34
Financial expense 168191270.31 171600672.91 -1.99
D. R&D Investment
a. R&D investment
RMB
R&D expenses 29041137.57
Capitalized R&D expenditures 0.00
Total R&D investment 29041137.57
% of revenue 0.09
Capitalization ratio of R&D investment % 0.00
b. Headcount
Headcount of R&D 143
Percentage of total staff % 1.56
Educational structure
Item Headcount
PhD 11
Master's degree 57
Bachelor’s degree 50
Junior college 21
High school and below 4
Age structure
Item Headcount
30 years old (30 excluded) 49
30-40 (30 included 40 excluded) 56
40-50 (40 included 50 excluded) 31
50-60 (50 included 60 excluded) 6
60 and above 1
c.Circumstances of R&D
(a) Feed product innovation and advancement in farming technologies
Swine feed: The Company focused its R&D efforts on the piglet and nursery stages with a focus on
optimizing daily feed formulations and nutritional levels while advancing low-zinc creep feed
technologies and developing eco-friendly formulas. The design and application of compound feed for
secondary fattening practices were completed providing stage-specific nutritional solutions for
different growth phases.Ruminant feed: The Company promoted proven feeding models for meat sheep to enhance farming
efficiency through precision nutrition management. Customized products and feeding programs were
developed for beef and dairy cattle to address nutritional needs supporting improved production
31 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
performance and overall farm profitability.Poultry feed: The Company enhanced its broiler nutrition database and promoted the use of bulk feed.Studies were conducted to examine the correlation between feed particle size and layer performance
aiming to improve eggshell quality in the late laying period and support greater profitability in poultry
farming.Raw material alternatives: The Company established a dynamic evaluation mechanism for assessing the
nutritional value of raw materials enabling rapid substitution during market fluctuations to maintain
nutritional consistency and control costs. Cross-departmental collaboration was enhanced to improve
raw material inventory turnover supporting cost reduction and operational efficiency through
coordinated initiatives.Farming technology empowerment: The Company focused on enhancing broiler production
performance and overall value chain efficiency while continuing R&D efforts to improve feed
conversion ratios and livability rates. In swine farming precision nutrition and feed formulation
technologies were further advanced and tailored feeding strategies were developed to support the
sustainable development of the swine business.(b) Key projects industry standards participation awards and patents
Patents Granted in 2024
Total number of patents
Number of patents granted
5 granted by the end of the 78
in 2024
reporting period
Participation in Standard Formulation and Scientific Projects
Participation in the Compound Feed for Aquatic Animals – Part 11: Loach Feed (GB/T 22919.11-2024)
formulation of Compound Feed for Aquatic Animals – Part 12: Crucian Carp Feed (GB/T 22919.12-2024)
national or industry Compound Feed for Beef Cattle (T/CFIAS 1003-2024)
standards Compound Feed for Meat Sheep (T/CFIAS 1004-2024)
Scientific projects
carried out or Breeding and Full Industry Chain Technologies for Livestock and Poultry with Regional
managed by the Characteristics in Liaoning Province – rated as "Excellent"
Company
Awards for Technological Innovation
Second Prize Liaoning Agricultural Science and Technology Contribution Award (2024):
Key Technological Innovations and Applications in Intelligent Breeding and Farming of Swine
Second Prize Liaoning Agricultural Science and Technology Contribution Award (2024):
Development and Demonstration of High-Efficiency Broiler Feed Based on Unconventional Raw
Materials
Liaoning Agricultural Science and Technology Contribution Award (2024):
Awards received
Research and Promotion of Low-Protein High-Fiber Diets and Standardized Feeding Models for
Sows
Industry Award:The Company’s 553A Gestating Sow Feed received the 2024 “Craftsmanship Award for SowFeed”
E.Cash flow
RMB
Item 2024 2023 Change %
Net cash flow from operating activities 1176900496.53 956152750.32 23.09
Net cash flow from investing activities -448278145.58 -402864641.04 -11.27
Net cash flow from financing activities -877353019.52 -308196369.71 -184.67
Net increase in cash and cash
-146542683.04246054337.82-159.56
equivalents
32 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
2. Assets and liabilities
A. Circumstance of assets and liabilities
RMB
% of total % of total
Item December 31 2024 December 31 2023 YoY change % Explanation
assets assets
Derivative Due to reduced futures investments at the end of the
2441832.400.024296668.600.03-43.17
financial assets reporting period
Due to a higher amount of commercial acceptance bills
Notes receivable 27893377.89 0.19 6620586.95 0.04 321.31
received during the reporting period
Due to significant fluctuations in raw material purchase
Prepayments 262395498.70 1.76 469857003.51 3.15 -44.15 prices during the reporting period the Company’s
prepayments declined accordingly
Due to the recovery of contract assets recognized at
Contract assets 628713.20 0.00 2432720.15 0.02 -74.16
the beginning of the reporting period
Other equity
Due to the fair value measurement of investees during
instrument 163722.78 0.00 14826710.99 0.10 -98.90
the reporting period
investments
Investment Due to the leasing of subsidiary plant facilities to
23980919.680.16-
properties external parties during the reporting period
Due to the acquisition of an equity interest in
Goodwill 19864604.90 0.13 290425.67 0.00 6739.82
Shandong Fengkang Food Company
Due to the Company’s optimization of its bank loan
Short-term
567278990.41 3.81 970957309.50 6.50 -41.58 structure by converting short-term borrowings into
borrowings
long-term borrowings
Due to taxes and fees accrued but not yet paid during
Taxes payable 56466910.36 0.38 42449739.70 0.28 33.02
the reporting period
Due to the implementation of an employee stock
Other payables 638629689.02 4.29 479780643.59 3.21 33.11
ownership plan during the reporting period
Current portion of
Due to a reduction in the current portion of long-term
non-current 497542789.55 3.34 932730557.07 6.24 -46.66
borrowings during the reporting period
liabilities
Due to the Company’s optimization of its bank loan
Long-term
1444154268.34 9.70 920051517.19 6.16 56.96 structure by converting short-term borrowings into
borrowings
long-term borrowings
Long-term Due to finance leases of fixed assets held by acquired
94867723.870.6442542892.620.28122.99
payables companies during the reporting period
33 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B. Overseas assets
Overseas assets amounted to RMB 3.5951 million accounting for 0.02% of total assets.C. Restrictions on major assets at the end of the reporting period
As of the end of the reporting period the Company’s total restricted assets amounted to RMB 263.178
million. For details please refer to Note 31 “Assets with Ownership or Usage Restrictions” under
Section VIII “Financial Statements” – “Notes to the Consolidated Financial Statements”.
3. Investment analysis
As of the end of the reporting period the balance of the Company’s long-term equity investments was
RMB 2484.3236 million representing an increase of 7.27% compared to the end of the previous year.Other equity instrument investments amounted to RMB 0.1637 million representing a decrease of
98.90% from the end of the previous year.
For details please refer to Long-term Equity Investments and Other Equity Instrument Investments
under Section VIII “Financial Statements” – “Notes to the Consolidated Financial Statements”.
34 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
4. Main holding and associated companies
RMB 10000
Registered
Company Primary business Total assets Net assets Net profit Revenue Pretax profit
capital
Beijing Sanyuan Wellhope Animal
Feed production and sales 1000.00 29472.49 22034.63 3109.90 57850.94 4043.56
Husbandry Company
Shenyang Wellhope Animal
Feed production and sales 8210.00 31859.08 26887.36 3537.56 95312.55 4894.45
Husbandry Company
Xi'an Wellhope Feed Technology
Feed production and sales 500.00 33196.90 27374.52 2576.34 91461.96 3003.17
Company
Broiler slaughtering processing
Anshan Jiuguhe Food Company 4320.00 106689.88 59310.88 4143.65 187464.32 4112.59
and sales
Feed processing broiler
Beipiao Hongfa Food Company breeder farming hatchery 3000.00 313241.18 172677.65 9710.83 393834.19 10575.63
broiler raising and slaughtering
Feed processing broiler
Dalian Heyuan Animal Husbandry
breeder farming hatchery 10000.00 173044.50 68680.93 -3122.63 253681.90 -2735.57
Company
broiler raising
Dalian Chengsan Food Group Feed processing broiler
1008.61241020.49153885.9023174.33505083.8423644.04
Company farming and slaughtering
Liaoning Wellhope Agriculture and
Animal Husbandry Development Swine farming 10000.00 113123.63 26144.41 10577.61 122603.57 10915.94
Company
Anhui Wellhope Animal Husbandry Feed processing and sales
16000.0057802.73-12065.19-1601.7887127.34-1167.68
Company swine farming
Tai’an Jiuguhe Agricultural Feed processing broiler
4730.0079220.945409.45-4943.00258037.11-4967.22
Development Company farming
Shenyang Wellhope Ruminant Feed
Feed production and sales 550.00 30113.80 26879.40 3167.66 59329.38 4289.48
Company
Feed processing broiler
Linghai Jiuguhe Feed Company 2655.00 23680.00 10363.96 -1296.98 121076.73 -1326.76
farming
35 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
VI. Discussion and Analysis on the Company’s Future Development
1. Industry outlook
Please refer to Section III “Management Discussion and Analysis” subsection 2 “Industry Overview” for
relevant details.
2. Development strategy of the Company
The Company has adopted a centralized group-driven management model and remains firmly
committed to strengthening its two core strategic businesses—feed and broiler. It will also promote the
high-quality development of its two emerging strategic businesses—swine and food—while
progressively building regional food brands. From 2025 to 2027 the Company aims to position itself as
a leading enterprise in agriculture livestock and food industries with industry-leading performance in
safety quality cost control and operational efficiency.
3. Business plan for 2025
The year 2024 witnessed a rapid rollout and accelerated implementation of macroeconomic policies.Looking ahead to 2025 as policy dividends continue to materialize the domestic economy is expected
to show marginal improvements with consumer demand gradually recovering amid ongoing volatility.In this macro environment the Company will remain committed to its core values of innovation
efficiency and self-discipline. It will stay focused on its principal businesses enhance core operational
capabilities and strengthen its resilience across cycles—aiming to deliver steady performance amid a
gradual structurally supported recovery while generating sustained value for shareholders.A. Feed business
The feed business has consistently remained the Company’s core line of business. In 2025 the
Company will further reinforce the strategic positioning of this segment and steadily advance three key
transformation initiatives: (1)Upgrading the overall competitiveness of the feed segment by
transitioning from a traditional advantage in concentrated feed to a stronger focus on complete feed
and premix products; (2) Building integrated service capabilities by maintaining the strength of the
Company’s distributor network while actively increasing the share of large-scale farming
clients—shifting from a single-channel advantage to a dual-focus model that balances both distribution
networks and large-scale farming clients; (3) Focusing resources on core operations by progressively
establishing a group-wide management model characterized by centralized guidance from
headquarters coordinated collaboration across business units and efficient resource sharing. Centered
around these three strategic directions the Company will further enhance its execution efficiency
streamline organizational structure and strengthen team capabilities. Efforts will be made to
implement dedicated business lines assign specialized personnel and uphold professional operating
standards with a continued focus on strengthening the deployment of key talent. For 2025 the
Company targets a year-on-year increase of over 10% in feed sales volume.
36 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B. Broiler integration business
In 2025 the Company will continue to be guided by seven core operational principles: ensuring safety
controlling development pace optimizing structure strengthening the business ecosystem reducing
costs improving efficiency and enhancing profitability. Building on these principles the Company will
continue to strengthen its internal operational capabilities advance its industrial deployment in a
phased and orderly manner and further optimize the structure of its integrated supply chain. On the
breeding side the Company will accelerate the expansion of its breeding stock increase the proportion
of self-supplied chicks continue to optimize key production indicators and enhance chick quality. These
efforts aim to strengthen the overall management and supply capacity of the Company’s breeder
operations. On the farming side the Company will temporarily pause the expansion of commercial
broiler production. At the same time it will moderately increase the proportion of externally sourced
broilers for slaughter. In parallel the Company will continue its efforts to reduce operational costs and
will accelerate the transition toward automation sustainable farming practices and efficient waste
resource utilization. On the slaughtering side the Company will maintain stable development based on
existing capacity. It will adopt a measured and incremental approach to capacity expansion prioritize
maximizing utilization efficiency and aim to deliver the highest overall value through an optimized
product mix. For 2025 the Company’s holding and associated companies target a total white-feather
broiler slaughter volume of approximately 960 million.C. Swine farming business
In 2025 the Company will continue to adhere to a prudent investment strategy for its swine farming
business. Key initiatives will include maintaining a steady development pace exercising strict control
over capital expenditure and intensifying efforts to reduce production costs. In terms of breeding the
Company aims to maintain a stable sow population while improving genetic management to enhance
breeding quality. It will also implement phased upgrades to existing sow farms focusing on production
processes operating models and housing infrastructure. In terms of fattening the Company plans to
expand piglet procurement and hog finishing operations in a moderate manner based on market
conditions. It will also continue to develop its capabilities in sales execution piglet sourcing and market
forecasting. In parallel the Company will strengthen internal management by further implementing its
performance-based management system expanding its core talent pool and gradually establishing a
standardized digitalized and modular farming management system designed to be scalable and
replicable across farms. These efforts aim to enhance operational efficiency and systematically reduce
production costs throughout the entire farming process. Biosecurity will remain a top operational
priority. The Company will continue to refine its biosecurity framework with a strong focus on managing
major challenges such as African swine fever porcine reproductive and respiratory syndrome and swine
diarrhea thereby ensuring the safe and stable operation of its farming assets. The Company's target for
2025 is a marketed volume of approximately 1.8 to 2.0 million hogs.
37 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
This business plan does not constitute a performance commitment to investors. Readers are advised to
exercise appropriate risk awareness.
4. Potential risks
A. Risks of fluctuations in raw material prices
Raw materials account for the majority of costs in the feed business. Fluctuations in output from key
production regions changes in import policies storage and subsidy programs exchange rate
movements logistics costs and other factors can all impact raw material prices—thereby affecting the
cost and gross margin of the Company’s feed operations. With the deepening internationalization of
agricultural trade in recent years raw material supply-demand dynamics and pricing are increasingly
influenced by both domestic and global spot and futures markets. As a result price trends have
become more volatile and complex making cost management significantly more challenging. In
addition evolving international political and economic conditions such as China-U.S. relations and the
Russia–Ukraine conflict have added further uncertainty to raw material procurement.Solutions
a. Wellhope has established strategic partnerships with leading domestic and international raw material
suppliers. It has also implemented a three-tier procurement model that combines centralized group
purchasing regional price-based bidding and local variety-specific sourcing ensuring clear role
definitions and procurement efficiency at each level.b. The Company integrates its raw material trading business with purchasing management. A
professional and experienced procurement team conducts targeted forward-looking research and
real-time market tracking. Through coordinated management of commodity categories and a
combination of spot and futures contracts Wellhope tactically lowers its overall purchase prices.c. The procurement team works closely with R&D production and sales teams. The R&D team develops
cost-effective alternatives to major raw materials; the production team continuously refines processes
and upgrades equipment; and the sales team supports purchasing strategy through wave-based volume
forecasting. Cross-departmental coordination information sharing and complementary strengths help
minimize the impact of raw material price fluctuations.d. Wellhope has established an information-sharing channel with Royal De Heus enabling timely
exchange of data on key raw materials and additives. The two parties have already launched joint
purchasing for vitamins amino acids and other ingredients—and plan to further expand the scope of
joint procurement to enhance overall bargaining power.B. Risks of fluctuations in livestock and poultry prices
Livestock and poultry production is a typically cyclical industry. Due to the lag in supply adjustments
prices tend to follow periodic fluctuations. Sharp price swings increase earnings volatility and
uncertainty for industry players.
38 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Solutions
a. In terms of strategy: Wellhope closely monitors price movements across upstream and downstream
segments. Over the years the Company has continuously deepened its market research improved
forecasting of industry trends and maintained flexibility in business strategy. Its three core business
segments share resources and complement one another enabling coordinated and phased capacity
planning. These efforts help mitigate the strategic risk of price fluctuations across the livestock and
poultry value chain.b. In terms of business: Wellhope’s integrated broiler business spans multiple modules including
breeder farming hatching feed production commercial broiler farming slaughtering and further
processing of both prepared and cooked food. This fully integrated model enables pricing volatility at
different stages to partially offset one another thereby smoothing overall cyclicality at the industry
chain level.c. In terms of management: The Company continuously refines production standards innovates
operating models and enhances process efficiency across business lines. By improving key performance
indicators and increasing per capita productivity Wellhope lowers unit operating costs. This cost
advantage reduces downside risk during industry downturns and enhances profitability during upward
cycles.C. Risks of serious animal epidemic
Feed and livestock farming are the Company’s two core businesses. Animal disease outbreaks represent
one of the most significant risks to the farming industry. Once an epidemic occurs it can trigger
widespread consumer panic—leading to reduced demand lower production declining revenues and
rising costs. The feed business which primarily serves the downstream farming sector is directly
affected by the prosperity or downturn of the livestock industry. As unpredictable events major
epidemics can have a profound impact on the Company’s operations.Solutions
a. Wellhope places strong emphasis on regional and structural diversification which remains one of the
most effective ways to mitigate epidemic-related risks.b. Prioritizing prevention over treatment the Company has established biosecurity monitoring centers
across all farming regions. It continuously adjusts the frequency and scope of disease testing based on
seasonal geographic and epidemiological patterns striving to detect and contain potential outbreaks
before they occur.c. Speed is critical in minimizing the impact of an outbreak. Wellhope has implemented a dedicated
emergency command system for major epidemics to enable timely decision-making and response
thereby reducing potential losses.d. The Company consistently conducts post-incident reviews and research to enhance its disease
prevention capabilities. It strengthens safeguards across multiple dimensions including animal
39 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
nutrition veterinary services and farm management practices.e. In response to African Swine Fever Wellhope has developed a comprehensive prevention and control
system that spans from R&D through to on-farm implementation forming a robust defense across the
entire swine production chain.D. Risk of industry restructuring due to environmental policies
In recent years the Chinese government has introduced a series of environmental regulations—such as
the revised Environmental Protection Law the Environmental Protection Tax Law the Regulations on
Pollution Prevention and Control in Livestock and Poultry Farming and the Action Plan for Agricultural
and Rural Pollution Control. These policies reflect the state’s growing commitment to environmental
regulation in the livestock sector. Stricter environmental enforcement is becoming the industry
norm—an irreversible trend that all livestock enterprises must address.Solutions
Since its founding Wellhope has embedded the principle of saving resources and protecting the
environment into its corporate mission. The Company treats full legal compliance and implementation
of environmental standards as key evaluation criteria for management teams and subsidiaries.Environmental protection is viewed not only as a regulatory obligation but as a core corporate
responsibility.a. In terms of animal farming and slaughtering: In response to increasingly stringent environmental
requirements all production units have conducted comprehensive risk assessments to identify
potential environmental hazards. Each factory has developed contingency plans for emergency
environmental incidents based on its specific operational context and local government regulations
ensuring business continuity. For key pollutant discharge entities Wellhope has implemented robust
self-monitoring programs enabling timely detection and remediation of risks. The Company continues
to increase investment in environmental personnel and infrastructure to ensure full and sustained
compliance with national standards.b. In terms of feed processing: Wellhope rigorously complies with all national environmental standards
and has established comprehensive controls for pollutants generated during feed production including
air emissions noise wastewater and solid waste. Environmentally friendly raw materials and additives
are incorporated into feed formulations and the Company continues to invest in the development of
safe and eco-friendly diets to reduce emissions of heavy metals nitrogen and phosphorus.E. Risks of exchange-rate fluctuations
Wellhope’s international business started early and has developed rapidly making it increasingly
susceptible to exchange rate fluctuations in areas such as raw material procurement product exports
and overseas investment. The impacts are reflected in the following aspects: Firstly with the
globalization of the feed industry international sourcing of raw materials has become standard practice.As a result exchange rate risks are particularly evident for raw materials primarily sourced from abroad.
40 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Secondly Wellhope’s broiler product export business continues to grow with customers across a wide
range of countries and regions. Settlements involving multiple currencies inevitably lead to exchange
rate fluctuations. Finally the Company’s overseas investments and operations are expanding and
cross-border capital flows and settlements are also exposed to currency volatility.Solutions
a. Wellhope closely monitors trends in the global foreign exchange market enhancing its awareness of
exchange rate risk and improving its capacity for market research and forecasting.b. The Company improves its bargaining power in foreign trade by strengthening product
competitiveness and mitigates exchange rate risk through mechanisms such as RMB settlement
contract clauses for value preservation and shared exchange risk provisions.c. Wellhope makes full use of a range of hedging instruments including forward contracts currency
swaps and option portfolios to manage foreign exchange exposures.d. In line with the principle of “matching currency with usage” the Company manages revenues and
liabilities by market to ensure alignment thereby reducing exchange rate risk through natural hedging.F. Risks of food safety
In recent years multiple food safety incidents in China have significantly undermined consumer
confidence. In response the government has continuously strengthened legislation on food safety and
traceability while increasing penalties for violations. A food safety incident resulting from poor quality
control could trigger widespread panic among consumers severely impact downstream demand and
cause substantial harm to both brand reputation and business performance.Solutions
Since its founding Wellhope has placed the highest priority on food and quality safety. The Company
adheres to a strict “Six Nevers” quality policy: never accept unqualified raw materials never use faulty
equipment never allow nonstandard operations never produce substandard products never ignore
dissatisfied customers and never tolerate inadequate service. A dedicated Food and Quality Safety
Management Committee has been established at the Group level with corresponding task groups
formed across all business divisions and subsidiaries. Responsibility is clearly assigned across all stages
to ensure sustained vigilance and accountability.a. In terms of feed business: Wellhope has established a three-tier quality management and testing
system at the headquarters region and subsidiary levels. It operates in full compliance with
international standards including ISO 9001 ISO 22000 and ISO/IEC 17025 while rigorously
implementing national regulations such as the Feed Quality and Safety Management Code and the
Veterinary Drug Production Quality Management Code. The Company maintains full-process quality
control and a traceability system. To further enhance testing capabilities it actively promotes
near-infrared technology to improve detection efficiency enable real-time data sharing and support
early warning mechanisms. Priority testing areas include heavy metals harmful microorganisms and
41 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
mycotoxins—providing critical assurance for feed safety.b. In terms of farming and slaughtering business: In farming operations the Company enforces strict
controls over drug use and residue management in both poultry and swine production. At the
slaughtering stage it continuously strengthens quality oversight strictly adhering to inspection
quarantine and drug residue testing protocols. From a business model perspective Wellhope’s
vertically integrated broiler chain includes breeder farming hatching feed production commercial
farming slaughtering and the further processing of prepared and cooked products. This integration
ensures a stable raw material supply and allows for stringent quality and safety controls throughout the
value chain. Through standardized management and process-based operations the Company integrates
biosecurity residue control and hygiene management to ensure end-to-end traceability of food safety.
42 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Section IV Corporate Governance Environmental Protection and Social Responsibility
I. Overview of Corporate Governance
In strict accordance with the Company Law Securities Law Code of Corporate Governance for Listed
Companies Listing Rules of the Shanghai Stock Exchange and other applicable laws regulations and
normative documents the Company has continuously strengthened and improved its corporate
governance practices and standardized operations. The General Meeting of Shareholders the Board of
Directors the Supervisory Board and Senior Management each perform their duties with a clear
division of responsibilities and well-defined authority. Internal governance mechanisms are structured
to ensure mutual checks and balances as well as effective coordination forming scientific and efficient
decision-making execution and supervisory framework. Independent directors the Supervisory Board
and the various special committees of the Board have actively performed their respective functions
with diligence loyalty and professionalism. They have issued objective and independent opinions on
matters under review ensuring that the Company operates in a lawful compliant fair and transparentmanner. Directors supervisors and senior management have effectively fulfilled their roles as the “keyfew” in corporate governance continuously improving the governance structure enhancing
transparency and safeguarding the legitimate rights and interests of the Company and its shareholders.During the reporting period the Company revised its Articles of Association in accordance with relevant
laws and regulations and proactively advanced revisions to the rules related to independent directors.The regular election of the Board of Directors the Supervisory Board and senior management was
successfully completed in January 2024. In 2024 the Company held a total of 4 general meetings of
shareholders 10 meetings of the Board of Directors 7 meetings of the Supervisory Board 5 meetings
of the Audit Committee 2 meetings of the Remuneration and Appraisal Committee 1 meeting of the
Strategy Committee 1 meeting of the Nomination Committee and 2 meetings of independent directors.All meetings were convened conducted and voted on in a standardized lawful and effective manner.Throughout the reporting period the Company continued to strengthen information disclosure
standardized operations and investor relations management. These efforts enhanced corporate
transparency ensured investors’ right to know and protected the lawful rights and interests of the
Company and all shareholders. The Company received a Grade A rating in the official assessment for its
information disclosure work in 2023–2024 marking the seventh consecutive year it has received this
recognition. Since its IPO in 2014 the Company has not been subject to any regulatory criticism
penalties or disciplinary actions related to information disclosure.II. General Meeting Convened during the Reporting Period
Links to Published Disclosing Date of
Meeting Date
Resolutions Resolution
The First Extraordinary
February 1 2024 www.sse.com.cn February 2 2024
General Meeting in 2024
The 2023 Annual General April 19 2024 www.sse.com.cn April 20 2024
43 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Meeting
The Second Extraordinary
May 23 2024 www.sse.com.cn May 24 2024
General Meeting in 2024
The Third Extraordinary September 2
www.sse.com.cn September 3 2024
General Meeting in 2024 2024
44 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
III. Information about Directors Supervisors and Senior Managers
1. Changes in shareholdings and remuneration of incumbent and outgoing directors supervisors and senior management during the reporting period
Pre-tax Whether the
remuneration individual
Number of Change in
Number of Reason for paid by the received
Start date of End date of shares held at shareholding
Name Office title Gender Age shares held at change in Company during remuneration
tenure term beginning of during the
end of the year shareholding the reporting from related
the year year
period parties of the
(RMB 10000) Company
Jin Weidong Chairman Male 61 Feb. 3 2015 Feb. 1 2027 149549498 149549498 82.00 No
Director
Qiu Jiahui Male 53 Feb. 1 2021 Feb. 1 2027 80.00 No
President
Jacobus
Johannes de Director Male 56 Feb. 3 2015 Feb. 1 2027 No
Heus
Shao Caimei Director Female 59 Feb. 3 2015 Feb. 1 2027 49773878 49773878 76.00 No
Director Feb. 3 2015 Feb. 1 2027
Former Board
Zhao Xin Secretary Female 53
Mar. 28
Feb. 1 2024 4420160 4420160 76.00 No
2016
(term expired)
Vice President Feb. 1 2024 Feb. 1 2027
Director Feb. 1 2024 Feb. 1 2027
Chen Yu Board Secretary Male 40 Apr. 2 2024 Feb. 1 2027 66.62 No
Chief Financial Aug. 12
Feb. 1 2027
Officer 2022
Independent
ZUO XIAOLEI Female 71 Feb. 1 2021 Feb. 1 2027 10.00 No
Director
Independent
Jiang Yan Female 51 Feb. 1 2021 Feb. 1 2027 10.00 No
Director
45 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Independent
Zhang Shuyi Male 60 Feb. 1 2021 Feb. 1 2027 10.00 No
Director
Former Vice
President Feb. 3 2015 Feb. 1 2024
(term expired)
Wang Fengjiu Male 56 47964602 47964602 31.50 Yes
Chairman of
Supervisory Feb. 1 2024 Feb. 1 2027
Board
Li Jun Supervisor Male 52 Apr. 27 2016 Feb. 1 2027 66.00 No
Marcus
Leonardus van Supervisor Male 56 Feb. 3 2015 Feb. 1 2027 No
der Kwaak
Jin Ge Vice President Male 35 Feb. 1 2024 Feb. 1 2027 73.00 No
Former Director
Zhang Wenliang Male 64 Feb. 3 2015 2024-02-01 8565100 8565100 20.00 No
(term expired)
Former Vice
Increase
Wang Xueqiang President Male 58 Feb. 1 2021 Feb. 1 2024 9355000 9375000 20000 85.00 No
holdings
(term expired)
Former Vice
Di Guo President Male 54 Feb. 1 2021 Feb. 1 2024 4908219 4908219 75.00 No
(term expired)
Former
Chairman of the
Wang Zhongtao Supervisory Male 61 Feb. 3 2015 Feb. 1 2024 46625229 46625229 No
Board
(term expired)
Former
Mar. 27
Ren Bingxin Supervisor Male 61 Feb. 1 2024 5429500 5429500 58.00 No
2019
(term expired)
Former
Yuan Minger Supervisor Female 54 Feb. 3 2015 Feb. 1 2024 32.18 No
(term expired)
Total / / / / / 326591186 326611186 20000 / 851.30 /
Note: Zhang Wenliang Wang Xueqiang Di Guo Ren Bingxin and Yuan Ming’er concluded their terms as directors supervisors or senior management on February 1 2024 due to the
expiration of their terms of office. The total remuneration listed above reflects all compensation received from the Company during the reporting period.
46 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Name Work experience
Male born in 1963 Chinese nationality. He holds a bachelor’s degree in Veterinary Medicine from Shenyang Agricultural University and a master’s degree in Physiology and
Biochemistry from Jilin University (formerly the People’s Liberation Army Veterinary University). He is a senior animal husbandry expert and a Ph.D. supervisor. His research
project was among the first to be funded by the National Natural Science Foundation of China. He is the core founder of Wellhope and has served as Chairman since 1995.After completing his postgraduate studies he spent two years teaching at the university before entering the business sector in 1991. He previously held positions as Regional
Sales Manager National Sales Manager and Assistant to the President for the Asia-Pacific region at Beijing Continental Grain Company. He currently serves as Vice Chairman
of the China Feed Industry Association Vice Chairman of the China Animal Agriculture Association Chairman of the Liaoning Feed Association and Chairman of the
Jin Weidong Haicheng City Chamber of Commerce under the Shenyang General Federation of Industry and Commerce. He has for many years served as an MBA interviewer and class
advisor for MBA programs at Peking University and Tsinghua University and has long been a visiting professor at Renmin University of China Ocean University of China and
Northeast Agricultural University. He has been recognized as China’s Outstanding Private Science and Technology Entrepreneur a National Outstanding Builder of the
Socialist Cause one of the Top 10 Economic Figures in China’s Feed Industry over 30 Years of Reform and Opening-up a recipient of the May Day Labor Medal of Shenyang
and a Model Worker of Liaoning Province. In addition he was named Outstanding Entrepreneur of Liaoning Province in 2017 recognized as a Career-Creating Talent in
Science and Technology Innovation by the Ministry of Science and Technology in 2018 selected as a member of the fourth cohort of Leading Talents in Technological
Entrepreneurship under the National Ten Thousand Talents Program in 2019 and awarded the honorary title of National Model Worker in 2020.Male born in 1972 Chinese nationality. He holds a bachelor's degree in Veterinary Medicine from Shenyang Agricultural University. After graduating from university he
worked at Dalian Broiler Breeder Farm a state-owned breeding enterprise where he was engaged in technical and on-site management. He joined Wellhope in 2000
starting as a business representative and was rapidly promoted due to his outstanding capabilities. He has successively served as General Manager of Haicheng Wellhope
Feed Mill and Haicheng Xinzhongxin Feed Mill Vice President of the former Huakang Feed Group Marketing Director of Wellhope President of the Broiler Integration
Business Division and Vice President of Wellhope. He is now the Director and President of Wellhope. He also serves as Vice President of the Liaoning Chinese and Foreign
Qiu Jiahui Entrepreneurs Club Member of the 9th Liaoning Provincial Agricultural Committee President of the Liaoning White Broiler Association Vice President of the Liaoning
Provincial Animal Husbandry Association and Guest Professor at the College of Animal Science and Technology and the College of Veterinary Medicine at Shenyang
Agricultural University. He was the lead contributor to the Company’s project that won the First Prize for Agricultural Technology Promotion under the National Harvest
Award (2019–2021) was awarded the May 1st Labor Medal of Shenbei New District in 2022 and received the honorary title of Shenyang Outstanding Expert (Eighth Session)
in 2023. Mr. Qiu Jiahui pioneered Wellhope’s broiler integration business. Over the past decade he has led the team to achieve rapid and transformative growth securing a
leading position in the industry.Jacobus Johannes Male born in 1969 Dutch nationality. He holds a master’s degree in Economics from the University of Groningen. He has been with De Heus since 1992 and is currently
de Heus serving as CEO of Royal De Heus. He also serves as a Director of Wellhope.Female born in 1966 Chinese nationality. She holds a PhD in Animal Physiology and Biochemistry from Nanjing Agricultural University and is a Senior Agronomist. She is one
of the co-founders of Wellhope. She previously served as a technician at the China Huamu Poultry Breeding Center under the Ministry of Agriculture and as a formulation
manager at Conti (Beijing) Feed Additive Co. Ltd. a subsidiary of Continental Grain Company. Since the founding of Wellhope she has consistently served as the Company’s
chief technical lead having held positions including Technology Director and Vice President. She is currently a Board Director and the Chief Technology Officer of Wellhope.She also holds various industry and academic positions including Standing Director of the Animal Nutrition Branch of the Chinese Association of Animal Science and
Shao Caimei Veterinary Medicine Member of the Chinese Feed Industry Standardization Technical Committee and Head of the Comprehensive Trial Farm for the National Swine Industry
Technology System. In addition she has served as a master’s supervisor in animal nutrition at China Agricultural University and in animal nutrition and feed processing at
Shenyang Agricultural University and has long held visiting professorships at Ocean University of China Shenyang Agricultural University Nanjing Agricultural University and
several other universities. She has received multiple First and Second Prizes for Provincial- and Ministerial-Level Science and Technology Progress Awards and has applied for
nearly 40 national invention patents. In 2022 she was named one of Forbes China Top 50 Women in Tech and in 2023 she was awarded the honorary title of Shenyang
Outstanding Expert (Eighth Session).
47 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Female born in 1972 Chinese nationality. She holds a bachelor's degree in Economics from Shenyang Agricultural University. She joined Wellhope in 1995 after graduating
from university and has successively served as Executive Assistant Director of the Marketing Department Director of the Human Resources Department Human Resources
Manager Chief HR Director Assistant to the Chairman and Board Secretary. She is currently a Board Director Vice President and Chief Human Resources Officer of
Zhao Xin
Wellhope. Ms. Zhao Xin has over 20 years of experience in human resources and enterprise management. She is one of the key contributors to the establishment of
Wellhope’s human resources management system. In 2020 and 2021 she was named “Outstanding Board Secretary” in the Selection of China’s Valuable Public Companies.In 2021 2022 and 2023 she received the “Golden Bull Board Secretary Award” by China Securities Journal.Male born in 1984 Chinese nationality. He holds a master's degree from Shanghai University of Finance and Economics and is a Certified Public Accountant. From
September 2009 to January 2017 he worked at KPMG Huazhen LLP where he held positions such as Auditor and Audit Department Manager. From January 2017 to May
Chen Yu
2019 he worked at New Northeast Electric Group where he was responsible for financial management. From May 2019 to November 2021 he served as Chief Financial
Officer at Anhui Hetian Hospital Management Co. Ltd. He is currently a Board Director Board Secretary and Chief Financial Officer of Wellhope.Female born in 1953 Singaporean nationality. She is a renowned economist and holds a PhD in International Finance and Econometrics from the University of Illinois USA.She previously served as a lecturer in the Department of Economic Statistics at the National University of Singapore Associate Professor at the Asian Institute of
Management in the Philippines Chief Economist and Chief Advisor to the President at Galaxy Securities Independent Director of Tongfang Co. Ltd. and Independent
ZUO XIAOLEI Director of Hubei Bank. She also served as a Special Researcher at the Counsellors' Office of the State Council and as a Researcher at the Financial Center under the
Counsellors' Office of the State Council of China. She is currently an Independent Director of Wellhope. Ms. ZUO XIAOLEI is one of the most influential economists in China.She has published numerous papers and articles in the fields of econometrics international finance and the securities market and is the author of Xiaolei’s Perspective: My
View on China’s Economy and other books.Female born in 1973 Chinese nationality. She holds a Doctorate in Management from the Institute of Fiscal Science under the Ministry of Finance and is a Certified Public
Accountant and a Certified Asset Appraiser. From 2002 to 2016 she worked in the Stock Issuance Supervision Department of the China Securities Regulatory Commission.Jiang Yan
She currently serves as an Independent Director of Weichai Power Co. Ltd. and Wellhope and acts as a core advisor to several investment banks including Minsheng
Securities Co. Ltd.Male born in 1964 Chinese nationality. He holds a PhD in Ecology from Marie Curie University (Université Marie Curie) in France. He is a second-level professor and a
doctoral advisor at Shenyang Agricultural University. He previously served as a Researcher at the Institute of Zoology Chinese Academy of Sciences Dean of the
Interdisciplinary Institute of Science and Technology at East China Normal University and Dean of the School of Management at Zhejiang Ocean University. He is currently a
Professor at the School of Animal Husbandry and Veterinary Medicine Shenyang Agricultural University and an Independent Director of Wellhope. In addition to his
academic career he has held positions including Independent Director of Wellhope Director of the Investment and Option Division at China High-Tech Investment Group
Zhang Shuyi Corporation Vice President of Tiansanqi Group Co. Ltd. (Beijing) and Legal Representative of Zhejiang Zhongke Marine Biotechnology Co. Ltd. Mr. Zhang Shuyi has made
outstanding achievements in the field of science. He has been awarded the Distinguished Young Scholars Fund by the National Natural Science Foundation of China
supported by the “Changjiang Scholars” Team Project of the Ministry of Education and selected into the first and second levels of the National Millions of Talents Project
the “Hundred Talents Program” of the Chinese Academy of Sciences and the Climbing Scholars Program for Higher Education Institutions in Liaoning Province. He has also
received the Special Government Allowance from the State Council the Second Prize of the National Science and Technology Progress Award the First Prize of the Shanghai
Natural Science Award.Male born in 1969 Chinese nationality. He holds a bachelor’s degree in Animal Science from Shenyang Agricultural University and a master’s degree in Animal Nutrition and
Feed Science from the Chinese Academy of Agricultural Sciences. He is one of the co-founders of Wellhope. After graduating from university he worked in the Academic
Affairs Office of Shenyang Agricultural University and later joined the wholly foreign-owned subsidiary of Continental Grain Company in China where he successively served
Wang Fengjiu
as Business Representative and Sales Manager for Northeast China. Since co-founding Wellhope in 1995 he has served as Business Manager and Deputy General Manager of
Liaoning Wellhope and as General Manager of multiple subsidiaries including Gongzhuling Wellhope Shenyang Wellhope Daqing Wellhope and Liaoning Wellhope Food
Company. From 2002 to 2014 he served as Director and President of Wellhope. He later held the position of Vice President leading the development of the Company’s food
48 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
deep processing business. He is currently Chairman of the Supervisory Board of Wellhope and Chairman of Petmate Pet Healthcare Institution. He previously served as a
Member of the Standing Committee of the Shenyang Municipal Committee of the CPPCC and as Vice Chairman of the CPPCC in Shenbei New District of Shenyang. He
currently serves as Executive Vice President of the Liaoning Agricultural Industrialization Association Vice President of the Liaoning Catering and Culinary Industry
Association and Vice President of the Shenyang Food Association.Marcus Leonardus van Male born in 1969 Dutch nationality. He holds a master's degree in Economics from the University of Groningen. After graduation he joined Royal De Heus in the
der Kwaak Netherlands where he currently serves as Chief Financial Officer. He is also a Supervisor of Wellhope.Male born in 1972 Chinese nationality. He holds a Master of Business Administration from Northeastern University. He previously worked as an export salesman at
Shenyang Grain Oil and Food Import and Export Company and as Sales Manager at Shenyang Tongfeng Trading Co. Ltd. He joined Wellhope in 2004 and has since served as
Li Jun General Manager of several subsidiaries including Wellhope Trading Division Shenyang Expert Shenyang Pufeng Trading and Liaoning Expert. He is currently a Supervisor of
Wellhope and President of the Company’s trading business division. Mr. Li Jun has been engaged in international trade for many years and has extensive experience in
trading feed raw materials. He has made significant contributions to the development of Wellhope’s trading business.Male born in 1989 Chinese nationality. He holds a bachelor’s degree in Veterinary Medicine from Nanjing Agricultural University and a master’s degree in Veterinary Science
from the University of Liverpool in the UK. He joined Wellhope in 2014 and has since held positions including Project Manager General Manager Director and Assistant
President in international business and broiler integration. He was promoted to Vice President in February 2024 is currently responsible for the strategic ruminant and
Jin Ge premix feed businesses within the feed business division. He also serves as Deputy to the Shenyang Municipal People’s Congress Vice President of the Youth Committee of
the Shenyang Western Returned Scholars Association Executive Council Member of the Liaoning Young Entrepreneurs Association and Deputy Director of the Youth
Entrepreneurship Committee of the Liaoning Chamber of Commerce. He was honored as Model Worker of Shenbei New District in 2022 and awarded the Shenyang May
Fourth Youth Medal in 2024.
49 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
2. Post held by incumbent and outgoing directors supervisors and senior managers in other entity
-Post in other entities
Start of End of
Name Other entity Post
tenure tenure
Professor at the
School of Animal
Shenyang Agricultural
Zhang Shuyi Husbandry and 2016
University
Veterinary
Medicine
Wuxi Kezhiqian
Zhang Shuyi Executive director 2012
Technology Company
Liaoning Petmate Bio-tech
Zhang Shuyi Board director 2016
Company
Independent
Jiang Yan Weichai Power Co. Ltd. 2020
director
Jacobus Johannes de
Royal De Heus Company CEO 2002
Heus
Marcus Leonardus
Royal De Heus Company CFO 2001
van der Kwaak
Beijing Huikezhongda
Jin Weidong Information Consulting Board director 2020
Company
Changzhou Sangdichuan
Jin Weidong Agricultural Development Executive director 2021
Company
Liaoning Guowei Industrial
Jin Weidong Board director 2021
Group Company
3. Remuneration of Directors Supervisors and Senior Management
The remuneration of directors and supervisors is reviewed and
Decision-making procedure for determined by the General Meeting of Shareholders while the
remuneration remuneration of senior management is reviewed and approved
by the Board of Directors.Whether directors abstain from
voting when their own Yes
remuneration is discussed
Comments from the Remuneration The Remuneration and Appraisal Committee reviewed the
and Appraisal Committee or remuneration of directors and senior management in accordance
independent directors on with the Company’s remuneration evaluation standards and
remuneration matters submitted the results to the Board for deliberation.Remuneration is determined based on industry standards the
Company’s operating performance job responsibilities and the
Basis for determining remuneration
work plan set at the beginning of the year as well as qualitative
and quantitative assessments of individual performance.Payment is made reasonably based on comprehensive
evaluations of the Company’s annual performance responsibility
Actual payment
fulfillment and the management capability of relevant
personnel.As of the end of the reporting period the total remuneration
Total remuneration during the
received by all directors supervisors and senior management
reporting period
was RMB 8.513 million.
50 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
4. Changes in Directors Supervisors and Senior Management
Reason for
Name Position Held Change Description
Change
Chen Yu Director Elected Election
Chen Yu Board Secretary Appointed Election
Chairman of the
Wang Fengjiu Elected Election
Supervisory Board
Left office upon
Wang Fengjiu Vice President Election
expiration of term
Zhao Xin Vice President Appointed Election
Left office upon
Zhao Xin Board Secretary Election
expiration of term
Jin Ge Vice President Appointed Election
Left office upon
Zhang Wenliang Director Election
expiration of term
Left office upon
Wang Xueqiang Vice President Election
expiration of term
Left office upon
Di Guo Vice President Election
expiration of term
Chairman of the Left office upon
Wang Zhongtao Election
Supervisory Board expiration of term
Left office upon
Ren Bingxin Supervisor Election
expiration of term
Left office upon
Yuan Minger Supervisor Election
expiration of term
IV. Board Meetings Held in the Reporting Period
Meeting Date Resolution
No. 2024-002 announcement –
The 19th Meeting of the 7th Maintaining the Conversion Price of
January 8 2024
Board of Directors Wellhope Convertible Bonds
Unchanged
The 20th Meeting of the 7th No. 2024-003 announcement –
January 15 2024
Board of Directors meeting resolution
The 1st Meeting of the 8th Board No. 2024-013 announcement –
February 1 2024
of Directors meeting resolution
The 2nd Meeting of the 8th Board No. 2024-018 announcement –
March 28 2024
of Directors meeting resolution
The 3rd Meeting of the 8th Board No. 2024-036 announcement –
April 25 2024
of Directors meeting resolution
The 4th Meeting of the 8th Board No. 2024-041 announcement –
May 7 2024
of Directors meeting resolution
No. 2024-051 announcement –
The 5th Meeting of the 8th Board
June 24 2024 Plan to Repurchase Shares through
of Directors
Bidding on the Stock Exchange
No. 2024-062 announcement –
The 6th Meeting of the 8th Board Maintaining the Conversion Price of
July 29 2024
of Directors Wellhope Convertible Bonds
Unchanged
The 7th Meeting of the 8th Board No. 2024-067 announcement –
August 14 2024
of Directors meeting resolution
The 8th Meeting of the 8th Board No. 2024-082 announcement –
October 28 2024
of Directors meeting resolution
51 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
V. Performance of Duties of Directors
1. Attendance of directors at board meetings and general meetings
General
Attendance of Board Meeting
Meeting
Absent from
Board
Independent two
meetings Number of
Name director Meetings Meetings consecutive
required By Meetings general
(yes or no) attended attended meetings
to attend proxy missed meetings
in person remotely without
during the attended
attending in
year
person
Jin Weidong No 10 10 7 No 3
Qiu Jiahui No 10 10 6 No 4
Jacobus
Johannes de No 10 10 10 No 0
Heus
Shao Caimei No 10 10 8 No 4
Zhao Xin No 10 10 4 No 4
Chen Yu No 8 8 2 No 4
ZUO XIAOLEI Yes 10 10 10 No 3
Jiang Yan Yes 10 10 10 No 4
Zhang Shuyi Yes 10 10 6 No 4
Zhang Wenliang No 2 2 2 No 1
Number of board meetings held during the year 10
Including on-site meeting 0
Meetings held remotely 2
A combination of on-site attendance and
8
communication methods
VI. Committees under the Board of Directors
1. Composition of Specialized Committees under the Board
Committee Member
Audit Committee Jiang Yan(Chairperson) ZUO XIAOLEI Shao Caimei
Nomination Committee ZUO XIAOLEI(Chairperson) Zhang Shuyi Shao Caimei
Remuneration and Appraisal Committee Zhang Shuyi(Chairperson) Jiang Yan Zhao Xin
Jin Weidong(Chairperson) Jacobus Johannes de Heus
Strategy Committee
Qiu Jiahui Chen Yu ZUO XIAOLEI
2. The Audit Committee held 5 meetings during the reporting period
Important comments
Date Agenda Other circumstance
and suggestions
All proposals were
Proposal on the
approved and
January 25 2024 appointment of the Non
submitted to the Board
Chief Financial Director
of Directors
2023 Annual Report
proposal on the All proposals were
reappointment of the approved and
March 25 2024 Non
accounting firm and submitted to the Board
2023 Internal Control of Directors
Evaluation Report
2024 First Quarter All proposals were
April 23 2024 Non
Report approved and
52 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
submitted to the Board
of Directors
2024 Semi-Annual All proposals were
Report and proposal on approved and
August 12 2024 Non
the change of the submitted to the Board
accounting firm of Directors
All proposals were
2024 Third Quarter approved and
October 28 2024 Non
Report submitted to the Board
of Directors
3. The Nomination Committee held 1 meeting during the reporting period
Important comments
Date Agenda Other circumstance
and suggestions
Proposal on the The proposal was
appointment of senior approved and
January 25 2024 Non
management submitted to the Board
personnel of Directors
4. The Remuneration and Appraisal Committee held 2 meetings during the reporting period
Important comments
Date Agenda Other circumstance
and suggestions
2023 remuneration The proposal was
packages for directors approved and
March 25 2024 Non
and senior submitted to the Board
management of Directors
The draft of the 2024
Employee Stock
The proposals were
Ownership Plan and
approved and
May 6 2024 the Administrative Non
submitted to the Board
Measures for the 2024
of Directors
Employee Stock
Ownership Plan
5.The Strategy Committee held 1 meeting during the reporting period
Important comments
Date Agenda Other circumstance
and suggestions
The proposal was
The second share
approved and
October 28 2024 repurchase plan of the Non
submitted to the Board
Company in 2024
of Directors
VII. Supervisory Board’s Statement on Risks Identified in the Company
During the reporting period the Supervisory Board raised no objections to supervisory matters.VIII. Employees of the Parent Company and Major Subsidiaries
1. Headcount
Full time employee of parent company 289
Full time employee of major subsidiaries 8878
Total full-time employees 9167
The number of retired employees whose expenses are
27
borne by the parent company and major subsidiaries
53 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Functions
Line Employees
Production 4051
Sales 2697
Technology 839
Finance 455
Administration 1125
Total 9167
Educational backgrounds
Educational background Employees
Master's degree and above 473
Bachelor's degree 2853
Junior college 2545
Below junior college 3296
Total 9167
2. Remuneration policy
Wellhope adheres to a human resources philosophy centered on performance-based compensation
meritocracy and fairness. The Company has established a comprehensive compensation and
performance incentive system covering key areas including salary policy appointment management
diversified incentives welfare protection and career development. This system strikes a balance
between fairness motivation and competitiveness linking individual compensation closely with both
organizational and personal performance. Total compensation is determined based on the Company’s
operating results and individual performance evaluations with the goal of continuously motivating
employees and achieving mutual growth.In 2024 the Company further strengthened its performance management practices. Key performance
indicators were established across business units multi-level ranking systems were introduced and
short-term incentives were awarded to the top 10% of high-performing teams. In the feed business
annual compensation was linked to business outcomes through a total compensation package model
reinforcing the connection between performance and pay. In the swine farming business performance-
and bonus-based pay models were piloted at the frontline level to directly tie employee income to
results. Tailored compensation structures were also implemented in the broiler and raw material
trading segments to reflect their specific operational characteristics. Meanwhile the Company
enhanced both internal and external benchmarking to ensure its compensation levels remain
competitive across industries and regions supporting talent attraction and retention. The Company
continued to improve its appointment and promotion processes by relying on a scientific talent
selection system to appoint high performers while demoting the bottom 10% based on performance.For consistently underperforming employees the Company conducted performance reviews and made
appropriate role adjustments to align capabilities with operational requirements. To further encourage
team performance the Company launched a commendation program for strategic business units with
recognition based on annual performance rankings. Through team-building initiatives and on-site
54 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
award ceremonies the Company fostered cross-departmental communication enhanced employees’
sense of recognition and achievement and supported their career development and personal growth.The Company provides employees with compensation and benefits that are competitive within both
the industry and the regions in which it operates. In accordance with relevant laws and regulations it
contributes to statutory social insurance and housing funds (five social insurances and one housing
fund) for employees. In addition the Company offers supplementary benefits such as commercial
insurance and annual health check-ups which also extend to employees’ families. To further enrich theemployee welfare system the Company has implemented various programs including the “Wings ofLove” initiative to promote internal resource sharing and enhance overall employee satisfaction.
3. Training plan
During the reporting period training initiatives were closely aligned with the Company’s overarching
strategic blueprint and human resources development objectives. Greater emphasis was placed on
driving business outcomes and improving operational effectiveness. The Company prioritized the
development of key talent embedded training within real-world business contexts accelerated the
growth of critical roles and delivered targeted outcome-oriented programs.A. Integrated learning with business execution to strengthen capabilities: Adopting a firmly
results-driven approach the Company intensified its efforts to upskill employees in key positions by
integrating training into hands-on business-critical scenarios. To support the transformation of
large-scale operations the Chairman President and other senior executives led the development of
five customized training programs for key accounts. Concurrently a corporate expert team designed 12
specialized courses focused on service and sales capabilities collectively reaching more than 28000
participants. A total of more than 90 training programs were delivered across a wide range of domains
including large-scale farm operations production and operations management livestock husbandry
frontline leadership and back-office support. These initiatives significantly enhanced workforce skill
levels and operational efficiency across both business and functional units.B. Codifying common strengths and scaling best practices: With a clear business-driven focus the
Company identified refined and scaled a series of best practices aligned with strategic priorities such
as large-scale farm development and cost optimization. These practices were codified and disseminated
organization-wide reaching over 5000 employees. In parallel a continuous improvement initiative was
launched to monitor and evaluate 21 improvement projects. As a result 9 high-impact initiatives were
formally recognized and promoted within the Company.C. Strengthening the talent pipeline and leadership readiness: Building upon its established talent
development framework the Company further refined and implemented a multi-tiered
precision-targeted onboarding program for new hires accelerating integration role alignment and
early-stage development. Key efforts included training externally recruited supervisors and developing
successor talent within both group- and business-unit-level leadership pipelines reaching more than
55 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
400 participants. Specialized training programs in legal affairs procurement and key account
management were introduced to reinforce back-office support capabilities. In addition over 3600 mid-
and senior-level managers engaged in live training sessions aimed at promoting organizational
alignment enhancing cross-functional collaboration and strengthening enterprise-wide cohesion.IX. Proposed Profit Distribution and Capital Reserve Capitalization Plan
1. Cash dividend
With a long-term and sustainability-driven perspective the Company has established a stable
consistent and well-defined shareholder return framework. This approach is informed by a
comprehensive assessment of factors such as business performance shareholder expectations capital
costs and the broader financing environment. It also takes into account both current and projected
profitability cash flow development stage capital expenditure requirements funding strategies and
credit conditions. Based on this framework the Company has implemented a structured profit
distribution policy to ensure the continuity and stability of its dividend practices. No changes were
made to the Company’s dividend policy during the reporting period.According to the audit conducted by RSM CHINA CPA LLP the Company recorded a net profit
attributable to shareholders of RMB 342468141.14 for the year ended December 31 2024. As of that
date undistributed profits at the parent company level totaled RMB 2793134438.75. Based on the
recommendation of the Board of Directors the profit distribution plan for 2024 is as follows:
The Board proposes to distribute a cash dividend of RMB 0.058 per share (inclusive of tax) based on
the total number of issued shares as of the record date for dividend distribution excluding shares
repurchased and held in the Company’s repurchase account. As of April 20 2025 the Company had
919434448 shares in issue. Based on 868671037 shares which exclude 50763411 shares held in the
repurchase account the total proposed cash dividend amounts to RMB 50382920.15 (inclusive of tax).In 2024 the Company repurchased its shares through bidding on the Stock Exchange with total
consideration amounting to RMB 287387710.93. The aggregate amount of cash returned to
shareholders comprising both the cash dividend and share repurchases totaled RMB 337770631.08
representing 98.63% of the net profit attributable to shareholders of the Company for the year.Shares held in the repurchase account are not entitled to dividends. If there is any change in the total
number of shares in issue between the date of this announcement and the record date the per-share
dividend will remain unchanged and the total distribution amount will be adjusted accordingly. Any
such adjustment will be separately announced.
2. Special statement on the cash dividend policy
Whether the dividend distribution is in compliance with the Company’s Articles of Yes
Association and the resolutions adopted at the General Meeting
Whether the criteria and ratios for dividend distribution are clearly defined and Yes
transparent
Whether the relevant decision-making procedures and mechanisms are Yes
56 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
well-established and effectively implemented
Whether the independent directors have duly fulfilled their duties and exercised their Yes
oversight functions as expected
Whether minority shareholders have been provided with sufficient opportunities to
express their views and concerns and whether their legitimate rights and interests Yes
have been fully safeguarded
3. Proposed profit distribution and capitalization of capital reserve for the reporting period
RMB
Bonus shares per 10 shares
Cash dividend per 10 shares (tax inclusive) 0.58
Shares transferred from capital reserve per 10 shares
Total cash dividend (tax inclusive) 50382920.15
Net profit attributable to shareholders of the Company
342468141.14
(consolidated)
Cash dividend as a percentage of net profit attributable
14.71%
to shareholders (consolidated)
Share repurchase amount included in total shareholder
287387710.93
return
Total shareholder return (tax inclusive) 337770631.08
Total shareholders return as a percentage of net profit
98.63%
attributable to shareholders (consolidated)
4. Cash dividend distribution over the past three fiscal years
RMB
Total cash dividends for the past three fiscal years (tax
158200122.95
inclusive) (1)
Total shares repurchase and cancellation for the past
0.00
three fiscal years (2)
Total cash return to shareholders for the past three
158200122.95
fiscal years (3) = (1) + (2)
Average annual net profit for the past three fiscal years
132742631.82
(4)
Cash return ratio for the past three fiscal years (%) (5) =
119.18
(3)/(4)
Net profit attributable to
shareholders of the Company (consolidated) most 342468141.14
recent fiscal year
Undistributed profits at year-end in the parent
2793134438.75
company’s standalone financial statements
X. Status of the Company's Share Incentive Scheme Employee Share Ownership Scheme or other
Employee Incentives and their Impacts
1. Status of the employee stock ownership plan
On May 7 2024 the Company convened the 4th meeting of the 8th Board of Directors and the 4th
meeting of the 8th Supervisory Board followed by the second extraordinary general meeting of
shareholders on May 23 2024. At these meetings the 2024 Employee Stock Ownership Plan (Draft) and
57 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
the Administrative Measures for the 2024 Employee Stock Ownership Plan were approved. Further
details can be found in the relevant announcements published on the website of the Shanghai Stock
Exchange (www.sse.com.cn) on May 8 and May 24 2024. A total of 426 employees participated in the
2024 Employee Stock Ownership Plan contributing RMB 72.10 million to subscribe for 14 million
treasury shares previously repurchased and held in the Company’s dedicated repurchase account.On August 22 2024 the Company received a Confirmation of Transfer Registration issued by the
Shanghai Branch of China Securities Depository and Clearing Corporation Limited. According to the
confirmation 14 million shares were transferred via off-market transaction on August 21 2024 from
the Company’s repurchase account to the securities account designated for the 2024 Employee Stock
Ownership Plan at a transfer price of RMB 5.15 per share.
2. Performance evaluation and incentive mechanism for senior management during the reporting
period
Annual performance evaluations for senior management were conducted based on the Company’s
actual operating performance and implemented in accordance with relevant internal regulations.XI. Development and implementation of the internal control system during the reporting period
The Company disclosed its Internal Control Evaluation Report concurrently with the release of the 2024
Annual Report. For details please refer to the Shanghai Stock Exchange website (www.sse.com.cn).XII. Management and Control over Subsidiaries during the Reporting Period
The Company implemented internal control over its subsidiaries in strict compliance with the Company
Law the Securities Law the Listing Rules of the Shanghai Stock Exchange and other applicable laws
regulations normative documents and the Articles of Association. The Company exercised risk control
through standardized management measures across subsidiaries including operational compliance
human resources financial oversight internal audit information disclosure investment and financing
activities and business performance evaluation. All subsidiaries consistently adhered to the Company’s
policies and regulations and established corresponding business plans and risk management
procedures aligned with the Company’s overall development strategy and annual business objectives.In accordance with the Company’s rules on the reporting and review of material matters each
subsidiary promptly reported significant business and financial events to the designated Company
officer and submitted major issues for deliberation by the Board of Directors or the General Meeting of
Shareholders in line with the authorization procedures. During the reporting period the Company
identified no major deficiencies in subsidiary management. Internal control over subsidiaries was
effectively implemented and operated as intended.XIII. Explanation of Audit Report for Internal Control
RSM CHINA CPA LLP the Company’s internal control auditor issued an Internal Control Audit Report
stating that as of December 31 2024 the Company maintained effective internal control over financial
reporting in all material respects in accordance with the Basic Standards for Enterprise Internal
58 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Control and relevant regulatory requirements.For further details please refer to the Company’s disclosure on the website of the Shanghai Stock
Exchange (www.sse.com.cn).Whether an internal control audit report was disclosed: Yes
Type of audit opinion on internal control: Standard unqualified opinion
XIV. Environmental Information
Whether an environmental protection
Yes
mechanism has been established
Environmental protection investment during the
1495.56
reporting period (RMB 10000)
1. Environmental compliance of the Company and its key subsidiaries identified as major pollutant
discharging entities by environmental authorities
A. Pollutant discharge information
The Company’s subsidiaries including the following entities — Puyang Wellhope Food Company
(“Puyang Wellhope”) Dalian Zhongjia Wellhope Food Company (“Zhongjia Food”) Dalian Huakang
Xinxin Food Company (“Dalian Huakang”) Shenyang Huakang Broiler Company (“Shenyang Huakang”)
Pingyuan Wellhope Food Processing Company (“Pingyuan Wellhope”) Changchun Wellhope Food
Company (“Changchun Wellhope”) Chifeng Wellhope Fuxinyuan Food Company (“Chifeng Wellhope”)
Shandong Heyuan Food Company (“Shandong Heyuan”) Dunhua Fengda Agriculture and Animal
Husbandry Development Company (“Dunhua Fengda”) Daqing Wellhope Food Company (“DaqingWellhope”) Hebei Taihang Wellhope Food Company (“Taihang Wellhope”) Anhui Wellhope Food
Company (“Anhui Wellhope”) Shandong Fengkang Food Company (“Shandong Fengkang”) and
Heilongjiang Wellhope Dasenlin Food Company (“Wellhope Dasenlin”) — have been designated by local
environmental protection authorities as key pollutant discharging entities. The pollution discharge
information is set out below.
59 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Number of Distribution of
Permitted discharge Non-compliance with
Company Names of major pollutants Discharge method discharge discharge Discharge concentration Applicable pollutant discharge standards Total discharge volume
volume discharge limits
outlets outlets
Wastewater
outlet: Southeast
corner of the
Wastewater: COD ammonia
company’s
nitrogen total phosphorus COD: 29.247 mg/L
Exhaust gas: 3 wastewater Wastewater emissions comply with the Emission
pH suspended solids Air emissions: Ammonia nitrogen: 2.436 mg/L
discharge monitoring Standard of Water Pollutants for Meat Processing
biochemical oxygen demand Direct discharge Total phosphorus: 0.467 mg/L COD: 7.446116?t/half year COD: 72.48?t/year
Puyang outlets station building Industry (GB 13457-1992);
animal and vegetable oils after treatment; Total nitrogen: 11.696 mg/L Ammonia nitrogen: Ammonia nitrogen: None
Wellhope Wastewater: 1 Exhaust gas Exhaust gas emissions comply with the Emission
fecal coliforms total nitrogen Wastewater: Sulfur dioxide: 0 mg/m3 0.566142?t/half year 5.436?t/year
discharge outlet: Boiler Standard of Air Pollutants for Boilers (GB
Exhaust gas: sulfur dioxide Indirect discharge Nitrogen oxides: 28 mg/m3
outlet room located at 13271-2014).(SO?) nitrogen oxides Particulate matter: 2.9 mg/m3
the northeast
particulate matter
corner of the
company
premises
Wastewater
outlet: Pumped
Wastewater: COD ammonia COD: 41.35 mg/L
Air emissions: to the municipal
nitrogen total phosphorus Exhaust gas: 1 Ammonia nitrogen: 1.98 mg/L Wastewater emissions comply with the
Direct discharge wastewater
pH suspended solids discharge Total nitrogen: 21.46 mg/L Comprehensive Wastewater Discharge Standard of
after treatment; treatment plant
Zhongjia biochemical oxygen demand outlet Total phosphorus: 2.64 mg/L Liaoning Province (DB 21/1627-2008); No emission due to simplified
Wastewater: Exhaust gas None None
Food total nitrogen Wastewater: 1 pH value: 7.27 Exhaust gas emissions comply with the Emission management
Discharged to outlet: Boiler
Exhaust gas: sulfur dioxide discharge Particulate matter: 22.9 mg/m3 Standard of Air Pollutants for Boilers (GB
wastewater room located on
(SO?) nitrogen oxides sulfur outlet Sulfur dioxide: 209 mg/m3 13271-2014).treatment plant the north side of
dioxide particulate matter Nitrogen oxides: 132 mg/m3
the company
premises
Wastewater
Wastewater emissions comply with stricter Wastewater is fully discharged
Wastewater: COD ammonia outlet: Southeast
Wastewater: COD: 300 mg/L standards than both the Comprehensive into the municipal pipeline
nitrogen total phosphorus corner of the
Discharged to Exhaust gas: 3 Ammonia nitrogen: 25 mg/L Wastewater Discharge Standard of Liaoning network with no direct
pH suspended solids total company’s
sewer network discharge Total phosphorus: 4 mg/L Province (DB 21/1627-2008) and the national emissions. Biomass boilers are
nitrogen five-day biochemical wastewater
Dalian after treatment; outlets Total nitrogen: 35 mg/L Emission Standard of Water Pollutants for Meat used for exhaust gas which is
oxygen demand animal and treatment None None
Huakang Air emissions: Wastewater: 1 pH value: 6.0–8.5 Processing Industry (GB 13457-1992); treated and discharged in
vegetable oils workshop
Compliant discharge BOD: 250 mg/L Exhaust gas emissions comply with the Emission compliance. Odorous gases
Exhaust gas: sulfur dioxide Exhaust gas
discharge after outlet Suspended solids: 250 mg/L Standard for Odor Pollutants (GB 14554-93) and the from workshops and
(SO?) nitrogen oxides outlet: Rooftop
treatment Animal and vegetable oils: 50 mg/L Emission Standard of Air Pollutants for Boilers (GB wastewater stations are
particulate matter of the company’s
13271-2014). treated before release.
boiler room
60 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
COD: 450?mg/L
Wastewater Animal and vegetable oils: 60?mg/L
outlet: Southeast Five-day biochemical oxygen demand:
Wastewater: five-day
corner of the 250?mg/L Wastewater emissions comply with the Emission
biochemical oxygen demand
company’s Total nitrogen: 50?mg/L Standard of Water Pollutants for Meat Processing
total nitrogen suspended Air emissions: COD: 118.27?t/year
Exhaust gas: 1 wastewater Ammonia nitrogen: 30?mg/L Industry (GB 13457-1992) and the Comprehensive
solids animal and vegetable Direct discharge COD: 7.0846?t/year Ammonia nitrogen:
discharge monitoring Suspended solids: 300?mg/L Wastewater Discharge Standard of Liaoning
oils ammonia nitrogen pH after treatment; Ammonia nitrogen: 32.76?t/year
Shenyang outlet station building pH value: 6.0–8.5 Province (DB 21/1627-2008);
COD total phosphorus Wastewater: 0.419?t/year Sulfur dioxide: None
Huakang Wastewater: 1 Exhaust gas Total phosphorus: 5?mg/L Exhaust gas emissions comply with the Emission
Exhaust gas: particulate Discharged to Sulfur dioxide: 0.60415?t/year 5.268?t/year
discharge outlet: Boiler Sulfur dioxide: 200?mg/m3 Standard of Air Pollutants for Boilers (GB
matter sulfur dioxide municipal pipeline Nitrogen oxides: 1.655?t/year Nitrogen oxides:
outlet room located at Ringelmann blackness: Grade 1 13271-2014) the Integrated Emission Standard of
nitrogen oxides Ringelmann after treatment 5.506?t/year
the northeast Mercury and its compounds: Air Pollutants (GB 16297-1996) and the Emission
blackness mercury and its
corner of the 0.05?mg/m3 Standard for Odor Pollutants (GB 14554-93).compounds
company Particulate matter: 30?mg/m3
premises Nitrogen oxides: 200?mg/m3
Wastewater
outlet: East side
of the old
Air emissions: wastewater Ammonia nitrogen: 1?mg/L Wastewater emissions comply with the Class II
Wastewater: COD ammonia Direct discharge monitoring COD: 50?mg/L standard under the Emission Standard of Water
nitrogen total phosphorus from natural gas station building pH value: 7.6–7.8 Pollutants for Meat Processing Industry (GB
COD: 4.971?t/year COD: 74.488?t/year
pH suspended solids boiler kitchen Exhaust gas: 6 Exhaust gas Suspended solids: 11?mg/L 13457-1992) and local influent quality requirements
Ammonia nitrogen: Ammonia nitrogen:
biochemical oxygen demand exhaust duct discharge outlets: East side Animal and vegetable oils: 0.51?mg/L of Linzhang County;
0.073?t/year 9.732?t/year
Pingyuan animal and vegetable oils feather meal outlets boiler room Sulfur dioxide: 1?mg/m3 Exhaust gas emissions comply with the Emission
Sulfur dioxide: Sulfur dioxide: None
Wellhope fecal coliforms total nitrogen exhaust duct and Wastewater: 1 rooftop of the Nitrogen oxides: 13?mg/m3 Standard of Air Pollutants for Boilers (GB
0.065834?t/year 3.395?t/year
Exhaust gas: sulfur dioxide sewage treatment discharge canteen north Particulate matter: 2.5?mg/m3 13271-2014) the Emission Standard for Odor
Nitrogen oxides: Nitrogen oxides:
nitrogen oxides particulate station exhaust outlet side of the Cooking fume: 1.6?mg/m3 Pollutants (GB 14554-93) and the Emission
0.391548?t/year 3.789?t/year
matter cooking fumes odor duct; wastewater Odor concentration: 478?mg/m3 Standard for Cooking Fumes from the Catering
hydrogen sulfide ammonia Wastewater: treatment Hydrogen sulfide: 0.11?mg/m3 Industry (GB 18483-2001) as well as relevant local
Indirect discharge station and east Ammonia: 0.62?mg/m3 emission limits for gas-fired boilers.side of the
feather meal
workshop
Wastewater: COD ammonia Air emissions: Wastewater COD: 14?mg/L Wastewater emissions comply with the Class II
nitrogen total phosphorus Compliant outlet: Inside the Suspended solids: 8?mg/L standard under the Emission Standard of Water
pH suspended solids five-day discharge after company’s Fecal coliform count: Not detected Pollutants for Meat Processing Industry (GB COD: 93.24?t/year
Wastewater: 1
biochemical oxygen treatment; wastewater pH value: 7.96 13457-1992) and the ultra-low discharge standards COD: 3.487?t/year Ammonia nitrogen:
discharge
demand(BOD?) animal and Wastewater: monitoring Ammonia nitrogen: 0.587?mg/L for COD (≤40?mg/L) ammonia nitrogen (≤1.0?mg/L) Ammonia nitrogen: 2.331?t/year
Changchun outlet
vegetable oils total nitrogen Discharged after station building BOD?: 2.7?mg/L and total phosphorus (≤0.4?mg/L) set by local 0.104?t/year Nitrogen oxides: None
Wellhope Exhaust gas: 1
Exhaust gas: hydrogen sulfide compliant Exhaust gas Animal and vegetable oils: 0.17?mg/L authorities; Nitrogen oxides: 1.1216?t/year 12.004?t/year
discharge
Ringelmann blackness treatment at outlet: Ringelmann blackness: Grade 1 Exhaust gas emissions comply with the Emission Sulfur dioxide: 0.07098?t/year Sulfur dioxide:
outlet
mercury and its compounds sewage treatment Northwest side Mercury and its compounds: Standard of Air Pollutants for Boilers (GB 2.983?t/year
sulfur dioxide particulate station; of the company’s 0.05?mg/m3 13271-2014) and the Emission Standard for Odor
matter nitrogen oxides boiler room Particulate matter: 30?mg/m3 Pollutants (GB 14554-93).
61 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Nitrogen oxides: 200?mg/m3
Sulfur dioxide: 200?mg/m3
Wastewater
Wastewater: COD ammonia outlet: East
nitrogen total phosphorus boundary of the Wastewater emissions comply with the Emission
Wastewater: 1 COD: 1000?mg/L COD: 0.893?t/year COD: 640.5?t/year
Chifeng pH suspended solids five-day Wastewater: company Standard of Water Pollutants for Meat Processing
discharge Ammonia nitrogen: Not limited Ammonia nitrogen: Ammonia nitrogen: Not None
Wellhope biochemical oxygen demand Indirect discharge premises next to Industry (GB 13457-1992).outlet pH value: 6–9 0.021?t/year available
animal and vegetable oils the wastewater
fecal coliforms total nitrogen monitoring
station building
Wastewater
outlet: Southeast
Wastewater: COD suspended side of the Anionic surfactants: 10?mg/L
solids fecal coliforms anionic wastewater pool pH value: 6.5–9.5 Wastewater emissions comply with the Emission
Air emissions:
surfactants ammonia at the company’s Ammonia nitrogen: 35?mg/L Standard of Water Pollutants for Meat Processing
Direct discharge Exhaust gas: 1
nitrogen total nitrogen total wastewater COD: 500?mg/L Industry (GB 13457-1992) and the Quality Standard COD: 1485?t/year
after treatment; discharge COD: 192.8?t/year
phosphorus pH five-day treatment Total nitrogen: 45?mg/L for Wastewater Discharged into Urban Sewage Ammonia nitrogen:
Shandong Wastewater: outlet Ammonia nitrogen:
biochemical oxygen demand station Animal and vegetable oils: 100?mg/L Systems (GB/T 31962-2015); 103.95?t/year None
Heyuan Treated before Wastewater: 1 17.35?t/year
(BOD?) animal and vegetable Exhaust gas BOD?: 200?mg/L Exhaust gas emissions comply with the Emission Total nitrogen:
entering discharge Total nitrogen: 27?t/year
oils chromaticity outlet: Boiler Suspended solids: 400?mg/L Standard for Odor Pollutants (GB 14554-93) and the 133.65?t/year
wastewater outlet
Exhaust gas: particulate room located on Total phosphorus: 6?mg/L Air Pollutant Emission Standard for Boilers of
treatment plant
matter sulfur dioxide the northwest Chromaticity: 64 Shandong Province (DB 37/2374-2018).nitrogen oxides side of the Fecal coliform count: 10000?cfu/L
company
premises
Exhaust gas
outlet: Boiler
Wastewater: COD ammonia room located on COD: 100?mg/L Wastewater emissions comply with the Class II
nitrogen total phosphorus Air emissions: the southeast Ammonia nitrogen: 20?mg/L standard under the Emission Standard of Water
total nitrogen pH suspended Direct discharge Exhaust gas: 1 side of the pH value: 6–8.5 Pollutants for Meat Processing Industry (GB
solids five-day biochemical after treatment; discharge factory area Animal and vegetable oils: 20?mg/L 13457-1992);
COD: 37.8?t/year
Dunhua oxygen demand (BOD?) Wastewater: outlet Wastewater BOD?: 40?mg/L Exhaust gas emissions comply with the Emission
Ammonia nitrogen: None None
Fengda animal and vegetable oils Treated before Wastewater: 1 outlet: North Suspended solids: 100?mg/L Standard of Air Pollutants for Boilers (GB
7.56?t/year
fecal coliforms entering discharge side of the Fecal coliform count: 10000?cfu/L 13271-2014) the Emission Standard for Odor
Exhaust gas: sulfur dioxide wastewater outlet wastewater pool Sulfur dioxide: 300?mg/m3 Pollutants (GB 14554-93) and the Integrated
nitrogen oxides particulate treatment plant at the company’s Nitrogen oxides: 300?mg/m3 Emission Standard of Air Pollutants (GB
matter Ringelmann blackness wastewater Particulate matter: 50?mg/m3 16297-1996).treatment
station
Wastewater: COD ammonia COD: 80?mg/L
nitrogen pH total dissolved BOD?: 15?mg/L
solids five-day biochemical Suspended solids: 50?mg/L
oxygen demand (BOD?) Air emissions: Exhaust gas Ammonia nitrogen: 12?mg/L
Wastewater emissions comply with the Emission
suspended solids total Direct discharge Exhaust gas: 1 outlet: North Animal and vegetable oils: 5?mg/L
Standard of Water Pollutants for Meat Processing Particulate matter: 0.51?t/year
nitrogen total phosphorus after treatment; discharge side of the pH value: 6–8.5
Industry (GB 13457-1992); Sulfur dioxide: 2.45?t/year
Daqing animal and vegetable oils Wastewater: outlet factory area Total phosphorus: 0.5?mg/L
Exhaust gas emissions comply with the Emission Nitrogen oxides: 3.06?t/year None None
Wellhope fecal coliforms anionic Treated before Wastewater: 1 Wastewater Fecal coliform count: 10000?cfu/L
Standard of Air Pollutants for Boilers (GB COD: 56?t/year
surfactants entering discharge outlet: North Anionic surfactants: 3?mg/L
13271-2014) and the Emission Standard for Odor Ammonia nitrogen: 8.4?t/year
Exhaust gas: particulate wastewater outlet side of the Total nitrogen: 16?mg/L
Pollutants (GB 14554-93).matter sulfur dioxide treatment plant factory area Particulate matter: 50?mg/m3
nitrogen oxides Ringelmann Nitrogen oxides: 300?mg/m3
blackness hydrogen sulfide Sulfur dioxide: 300?mg/m3
ammonia odor concentration Mercury and its compounds:
62 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
cooking fumes mercury and 0.05?mg/m3
its compounds
Phase I
Wastewater COD: 33.229?t/year
outlet: Ammonia nitrogen:
COD: 20.84?mg/L
Northwest 3.323?t/year
Wastewater: COD ammonia Ammonia nitrogen: 0.09?mg/L
corner of the Total nitrogen:
nitrogen total phosphorus Total phosphorus: 0.13?mg/L
company’s Wastewater emissions comply with the Class A 9.969?t/year
pH suspended solids five-day Exhaust gas: 5 Total nitrogen: 8.48?mg/L
Air emissions: wastewater standard under the Discharge Standard of COD: 14.354?t/year Total phosphorus:
biochemical oxygen demand discharge Suspended solids: 8?mg/L
Direct discharge monitoring Pollutants for Municipal Wastewater Treatment Ammonia nitrogen: 0.332?t/year
Taihang (BOD?) animal and vegetable outlets BOD?: 5.0?mg/L
after treatment; station building Plants (GB 18918-2008); 0.058?t/year Full plant after None
Wellhope oils fecal coliforms total Wastewater: 1 Animal and vegetable oils: 0.06?mg/L
Wastewater: Exhaust gas Exhaust gas emissions comply with the Air Pollutant Total nitrogen: 6.007?t/year Phase II
nitrogen discharge Nitrogen oxides: 20?mg/m3
Indirect discharge outlet: Boiler Emission Standard for Boilers of Hebei Province (DB Total phosphorus: 0.095?t/year COD: 73.994?t/year
Exhaust gas: sulfur dioxide outlet Sulfur dioxide: Not detected
room located at 13/5161-2020). Ammonia nitrogen:
nitrogen oxides particulate Mercury and its compounds: Not
the northwest 7.399?t/year
matter detected
corner of the Total nitrogen:
Ringelmann blackness: ≤ Grade 1
company 22.198?t/year
premises Total phosphorus:
0.740?t/year
Wastewater
Wastewater: five-day outlet: Southeast
biochemical oxygen demand corner of the
suspended solids animal and company’s
Air emissions: Exhaust gas: 1 COD: 46?mg/L Wastewater emissions comply with the Emission
vegetable oils ammonia wastewater
Direct discharge discharge Ammonia nitrogen: 0.58?mg/L Standard of Water Pollutants for Meat Processing
nitrogen pH COD Escherichia station COD: 3.58?t/year COD: 381.55?t/year
Anhui after treatment; outlet Low-concentration particulate matter: Industry (GB 13457-1992);
coli Exhaust gas Ammonia nitrogen: Ammonia nitrogen: None
Wellhope Wastewater: Wastewater: 1 12.3?mg/m3 Exhaust gas emissions comply with the Emission
Exhaust gas: particulate outlet: 0.123?t/year 22.89?t/year
Discharged after discharge Nitrogen oxides: 24?mg/m3 Standard of Air Pollutants for Boilers (GB
matter sulfur dioxide Northwest
treatment outlet Sulfur dioxide: Not detected 13271-2014).nitrogen oxides Ringelmann corner of the
blackness and other company’s
characteristic pollutants wastewater
station
Wastewater: COD ammonia Wastewater COD: 22.2?mg/L
nitrogen total salinity total outlet: Northeast Ammonia nitrogen: 0.07?mg/L
nitrogen total phosphorus Air emissions: corner of the Total phosphorus: 0.71?mg/L
pH suspended solids five-day Direct discharge company’s Total nitrogen: 31.4?mg/L Wastewater emissions comply with the Emission COD: 93.2?t/year
Exhaust gas: 2 COD: 29.6?t/year
biochemical oxygen demand after treatment; wastewater pH value: 6.86 Standard of Water Pollutants for Meat Processing Ammonia nitrogen:
discharge Ammonia nitrogen:
(BOD?) anionic surfactants Wastewater: monitoring Sulfur dioxide: 3?mg/m3 Industry (GB 13457-1992); 9.32?t/year
Shandong outlets 1.53?t/year
animal and vegetable oils Treated and then station building Nitrogen oxides: 50?mg/m3 Exhaust gas emissions comply with the Air Pollutant Sulfur dioxide: None
Fengkang Wastewater: 1 Total phosphorus: 2.13?t/year
fecal coliforms indirectly Exhaust gas BOD?: 33.6?mg/L Emission Standard for Boilers of Shandong Province 1.82?t/year
discharge Total nitrogen: 21.7?t/year
Exhaust gas: sulfur dioxide discharged to outlet: Boiler Anionic surfactants: 0.97?mg/L (DB 37/2374-2018) and the Emission Standard for Nitrogen oxides:
outlet
nitrogen oxides particulate wastewater room located at Animal and vegetable oils: 1.83?mg/L Odor Pollutants (GB 14554-93). 5.46?t/year
matter odor concentration treatment plant the northern end Fecal coliforms: 940?cfu/L
ammonia hydrogen sulfide ( of the company Particulate matter: 3.1?mg/m3
Ringelmann blackness premises Ringelmann blackness: 0?mg/m3
Wastewater: COD ammonia Air emissions: Exhaust gas COD: 120–140?mg/L Wastewater emissions comply with the Class II
nitrogen total nitrogen pH Direct discharge Exhaust gas: 1 outlet: Boiler Ammonia nitrogen: 1.5–1.6?mg/L standard under the Emission Standard of Water Particulate matter:
suspended solids five-day after treatment; discharge room located at pH value: 6–8.5 Pollutants for Meat Processing Industry (GB 25.88?t/year
Wellhope biochemical oxygen demand Wastewater: outlet the northwest Animal and vegetable oils: 50?mg/L 13457-1992); Sulfur dioxide: 28.86?t/year
None None
Dasenlin (BOD?) animal and vegetable Treated before Wastewater: 1 side of the BOD?: 250?mg/L Exhaust gas emissions comply with the Emission COD: 5.83?t/year
oils fecal coliforms entering discharge factory area Suspended solids: 300?mg/L Standard of Air Pollutants for Boilers (GB Ammonia nitrogen:
Exhaust gas: sulfur dioxide wastewater outlet Wastewater Fecal coliform count: 200–270?cfu/L 13271-2014) the Emission Standard for Odor 1.43?t/year
nitrogen oxides particulate treatment plant outlet: West side Sulfur dioxide: 300?mg/m3 Pollutants (GB 14554-93) and the Integrated
63 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
matter Ringelmann blackness of the Nitrogen oxides: 300?mg/m3 Emission Standard of Air Pollutants (GB
wastewater pool Particulate matter: 50?mg/m3 16297-1996).at the company’s
wastewater
treatment
station
64 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B. Circumstance of building and operating pollution control facilities
Puyang Wellhope
a. Wastewater treatment: Puyang Wellhope operates a 2000-ton-per-day wastewater treatment
station utilizing a process of pretreatment oil separation A2O and disinfection. The environmental
protection facilities are functioning properly and pollutant discharge complies with the Level III
standards of GB 13457-1992 the company’s emission permit environmental impact approval and the
indirect discharge standards of the Nanle County Sewage Treatment Co. Ltd.b. Waste gas treatment: Gas from the wastewater tank is collected and treated in two stages: alkali
scrubbing and activated carbon adsorption then discharged through a 25-meter stack. Waste gas from
the slaughtering shed and broiler platform undergoes the same treatment and is discharged through a
15-meter stack. Coal boilers have been replaced by low-nitrogen gas boilers with emissions discharged
through an 8-meter stack in compliance with GB 13271-2014.Zhongjia Food
a. Wastewater treatment: Zhongjia Food operates a 1200-ton-per-day wastewater treatment station
using a process of mechanical grating oil separation adjustment pool hydrolysis contact oxidation
sedimentation and sand filtration. Emissions meet DB 21/1627-2008 (Liaoning Provincial Integrated
Wastewater Discharge Standard).b. Waste gas treatment: Waste gas from the 4T coal-fired boiler is treated by wet dedusting and
magnesium oxide desulfurization. Emissions meet the GB 13271-2014 standards and are discharged
through a 25-meter stack.Dalian Huakang
a. Wastewater treatment: Dalian Huakang operates a 1700-ton-per-day treatment station using SBR
with physical-chemical treatment hydrolytic acidification anaerobic and aerobic processes. Effluent is
discharged into the municipal treatment system meeting stricter standards than both DB
21/1627-2008 and GB 13457-1992.
b. Waste gas treatment: Particulates SO? and NOx from biomass boilers are treated by wet dedusting
and magnesium oxide desulfurization and discharged via a 35-meter stack. Odorous gas (NH? H?S) from
the slaughterhouse and wastewater station is treated with activated carbon and low-temperature
plasma then discharged via 15-meter chimneys complying with GB 14554-93.Shenyang Huakang
a. Wastewater treatment: Shenyang Huakang operates a 2220-ton-per-day wastewater treatment
station with grating oil separation air flotation AO treatment secondary sedimentation and
flocculation-phosphorus removal. All discharges meet DB 21/1627-2008 standards.b. Waste gas treatment: The 4T biomass boiler exhaust is treated with a bag filter and discharged
through a 35-meter stack meeting GB 13271-2014 standards.
65 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Pingyuan Wellhope
a. Wastewater treatment: Pingyuan Wellhope operates a 3000-ton-per-day wastewater station using
the AO process. Discharge meets Class II of GB 13457-1992 the emission permit and Linzhang County's
inlet requirements.b. Waste gas treatment: Gas from the wastewater tank is purified via activated carbon adsorption and
photolysis discharged through a 15-meter-high stack. Boilers were upgraded to low-carbon gas-fired
units and discharged through a 12-meter-high stack meeting GB 13271-2014.Changchun Wellhope
a. Wastewater treatment: Changchun Wellhope operates a 500-ton-per-day station using oil separation
air flotation and A2O. Discharge meets GB 13457-1992 (Level II) emission permit and Changchun's
ultra-low standard implemented since February 2021.b. Waste gas treatment: Boiler exhaust is treated by bag filter meeting special limits for coal boilers
under GB 13271-2014 and discharged through a chimney at least 40 meters high.Chifeng Wellhope
Wastewater treatment: Chifeng Wellhope operates a 2400-ton-per-day wastewater treatment plant
utilizing the A2O (Anaerobic-Anoxic-Oxic) process. The equipment and facilities are operating in good
condition. Key discharge parameters including COD ammonia nitrogen pH and flow are monitored
automatically and linked to the municipal Bureau of Ecology and Environment’s networked monitoring
system. The company has also built a biogas facility with a daily processing capacity of 8000 cubic
meters capable of fermenting wastewater gastrointestinal contents from livestock and poultry manure
and solid residues from harmless treatment. The generated biogas is used to fuel boilers while the
biogas residue and slurry are returned to farmland as fertilizer.Shandong Heyuan
a. Wastewater treatment: Shandong Heyuan operates a 2000-ton-per-day wastewater treatment
station using the AO process. Its environmental protection facilities are running normally and pollutant
emissions comply with GB 13457-1992 and the discharge permit.b. Waste gas treatment: Gas from the wastewater tank is treated with activated carbon and discharged
through a 15-meter-high stack. Coal boilers have been replaced with gas-fired ones and emissions
meet DB 37/2374-2018 and the discharge permit released through a 10-meter stack.Dunhua Fengda
a. Wastewater treatment: Dunhua Fengda operates an 800-ton-per-day treatment station using air
flotation and A2O. All discharges meet GB 13457-1992 (Level II) and the emission permit.b. Waste gas treatment: Boiler flue gas is treated with a bag filter and discharged through a
20-meter-high stack. Biomass boilers have replaced coal ones and emissions comply with GB
13271-2014 and the discharge permit.
66 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Daqing Wellhope
a. Wastewater treatment: Daqing Wellhope operates a 500-ton-per-day A2O wastewater treatment
station. A new 500-ton/day facility was added in 2023. All units operate normally and discharges
comply with GB 13457-1992.b. Waste gas treatment: Waste gas from the company’s 4T biomass boiler is removed by the bag filter
and multi-tube ceramic dust collector then discharged by exhaust funnel. All types of pollutants have
met the emission standards complying with the concentration requirements for biomass boilers under
GB 13271-2014.Taihang Wellhope
a. Wastewater treatment: Taihang Wellhope has two treatment units each handling 3500 tons/day
totaling 7000 tons/day. The process includes grating oil separation adjustment air flotation
hydrolysis-acidification anoxic tank contact oxidation and phosphorus removal. Discharges meet Class
A of GB 18918-2008 and the inlet standard of the local sewage plant.b. Waste gas treatment: Waste gas is collected under slight negative pressure treated through chemical
scrubbing and bio-filtration and discharged through a 15-meter-high stack. Boilers are low-nitrogen
natural gas models with emissions released through stacks not lower than 15 meters complying with
DB 13/5161-2020.Anhui Wellhope
a. Wastewater treatment: Anhui Wellhope operates an 1800-ton-per-day wastewater treatment
station using grating pretreatment oil separation hydrolysis-acidification A/O process and
disinfection. Facilities are running properly and pollutant discharges comply with GB 13457-1992 (Level
III) the emission permit environmental impact approval and indirect discharge requirements of the
local sewage plant.b. Waste gas treatment: Gas from wastewater tanks as well as from slaughtering pens hair-burning
areas red and white offal processing areas gastric juice storage rooms and temporary storage rooms is
collected and treated in two stages: first by an alkali scrubber then by biological filtration using an
activated microbial system. The treated gas is discharged through a 15-meter-high stack. Boilers are
low-nitrogen natural gas models and emissions through an 8-meter-high stack comply with GB
13271-2014 for gas-fired boilers.
Shandong Fengkang
a. Wastewater treatment: Shandong Fengkang operates a 4000-ton-per-day wastewater treatment
station which uses a process of grating oil separation tank air flotation unit AO process secondary
sedimentation tank and flocculation–phosphorus removal sedimentation tank. The environmental
protection facilities are functioning normally and pollutant discharges comply with the national
Discharge Standard of Water Pollutants for Meat Processing Industry (GB 13457-1992) as well as the
influent water quality requirements of the Jiangtuan Sewage Treatment Plant.
67 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
b. Waste gas treatment: The company uses gas-fired boilers equipped with low-nitrogen combustion
technology. The flue gas emission concentrations meet the limits specified in the Shandong Provincial
Boiler Air Pollutant Emission Standard (DB 37/2374-2018) for gas boilers and emissions are discharged
through an 8-meter-high chimney in full compliance with relevant standards.Wellhope Dasenlin
a. Wastewater treatment: Wellhope Dasenlin operates an 800-ton-per-day wastewater treatment
station using air flotation and A2O processes. Environmental protection systems are functioning
normally and emissions meet GB 13457-1992 (Level II) and the emission permit.b. Waste gas treatment: Boiler flue gas is treated using a multi-tube ceramic dust collector and
discharged through a 40-meter-high chimney. The boiler is biomass-fired and all emissions comply with
GB 13271-2014 and the emission permit.C. Environmental impact assessment and other environmental protection permits for construction
projects
During the reporting period all the Company’s construction projects complied with the requirements
for environmental impact assessments and other environmental protection permits. The Company
strictly implemented the “three-simultaneities” environmental management system.D. Emergency plan for environmental incident
In accordance with the requirements of environmental authorities and applicable laws and regulations
each production entity of the Company has identified environmental risk points and developed
emergency plans for potential environmental incidents taking into account actual operating conditions
and local government requirements. The Company has also conducted emergency drills to enhance its
preparedness and response capabilities. Regular risk inspections are carried out to identify and
eliminate potential hazards in a timely manner ensuring stable and uninterrupted operations.E. Self-monitoring program for environmental compliance
In strict compliance with the Measures for Self-Monitoring and Information Disclosure by Key
State-Monitored Enterprises and other applicable laws and regulations the Company’s key
pollutant-discharging entities have established self-monitoring programs that define monitoring
parameters frequencies locations and responsible implementing parties. Monitoring and information
disclosure are carried out in a timely manner in accordance with the established programs.F. Environmental administrative penalties during the reporting period
On July 30 2024 Dalian Huakang Xinxin Food Co. Ltd. received an administrative penalty decision from
the Dalian Municipal Bureau of Ecology and Environment for discharging wastewater that failed to meet
the required standards the company was fined RMB 80000. It immediately initiated rectification
efforts and conducted a comprehensive review to standardize its environmental management practices.It will strictly implement environmental protection measures in accordance with relevant national
policies to prevent the recurrence of such incidents.
68 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
2. Environmental compliance status of non-key pollutant-discharging subsidiaries
A. Administrative penalties due to environmental violations
On August 13 2024 Zhangjiakou Wellhope Animal Husbandry Co. Ltd. was fined RMB 160000 by the
Zhangjiakou Municipal Bureau of Ecology and Environment for discharging livestock wastewater into a
farmland due to a malfunction in its UASB anaerobic digester. The company promptly took corrective
action and reviewed its environmental management practices. It will continue to strictly follow national
environmental regulations to prevent similar incidents in the future.B. Disclosure of other environmental information with reference to key pollutant-discharging entities
The Company’s non-key pollutant-discharging entities mainly consist of feed mills swine and broiler
farms.a. The main pollutants from feed mills are dust and noise. The Integrated Emission Standard of Air
Pollutants (GB 16297-1996) sets emission heights and concentration limits for dust. Related companies
use pulse-jet dust collectors and other methods to ensure dust emissions remain below national
thresholds. For noise the Emission Standard for Industrial Enterprises Noise at Boundary (GB
12348-2008) defines limits and testing methods. Related companies mitigate noise by enclosing key
equipment in sound-insulated rooms and installing silencers on fan outlets.b. The main pollutants from swine and broiler farms include:
– Wastewater: primarily containing COD ammonia nitrogen suspended solids BOD and
microorganisms;
– Exhaust gas: primarily nitrogen oxides sulfur compounds and particulate matter;
– Solid waste: mainly manure spent bedding materials and animal hair.All farming operations strictly comply with the Pollutant Discharge Standards for the Livestock and
Poultry Breeding Industry (GB 18596-2001) and the emission limits for gas-fired boilers under the Boiler
Air Pollutant Emission Standard (GB 13271-2014). Emissions of ammonia and hydrogen sulfide follow
the Emission Standard for Odor Pollutants (GB 14554-93).During the reporting period the Company and its subsidiaries fully complied with applicable
environmental laws regulations standards and other requirements. They assumed full responsibility
for environmental compliance actively implemented pollution control and emission reduction
measures strengthened day-to-day management and maintenance of environmental facilities and
ensured stable system operation. Wastewater exhaust gas and solid waste were regularly monitored
by environmental authorities with all major pollutants discharged in compliance. Total emissions
remained within the limits approved by the competent authorities.
3. Information related to ecological protection pollution prevention and fulfillment of
environmental responsibilities
While strengthening workplace safety the Company actively promotes a green development
philosophy and takes full responsibility for environmental protection. Together with its subsidiaries it
69 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
has made sustained efforts in ecological conservation and pollution prevention across farming
slaughtering and food processing operations. To prevent water pollution wastewater treatment
stations at all swine and broiler farms and slaughterhouses are designed to meet discharge standards
and have operated consistently throughout the year with stable compliant output helping to protect
aquatic ecosystems. To reduce air pollution the Company uses biomass or natural gas boilers at its
farms and slaughterhouses which emit significantly lower levels of carbon and nitrogen oxides
compared to other fuels. These boilers achieve standard-compliant emissions without the need for
desulfurization or denitrification technologies. To prevent pollution caused by farming the Company
has introduced organic fertilizer projects that utilize modern biotechnology to efficiently and rapidly
convert waste into high-quality organic fertilizer promoting the resource utilization of livestock farming
waste.
4. Measures taken to reduce carbon emissions and their results during the reporting period
Whether carbon reduction measures were taken Yes
Reduction in CO? equivalent emissions (unit: tons) /
Type of carbon reduction measures
(e.g. adoption of clean energy for power
generation implementation of carbon reduction Implementation of carbon reduction technologies
technologies in production processes in production processes
development and manufacturing of low-carbon
products)
Detailed description:
The Company remains strongly committed to advancing low-carbon operations by addressing emissions
at their source and implementing a series of effective reduction strategies. These efforts have produced
measurable results. In the area of energy use the Company has transitioned to cleaner energy sources
by replacing traditional fuel-fired boilers with natural gas or biomass alternatives. This shift has
significantly reduced carbon emissions from combustion and reflects the Company’s strong
environmental responsibility setting a benchmark for clean energy adoption. In its broiler operations
the Company has adopted refrigeration heat recovery systems capturing waste heat from refrigeration
compressors and oil-based systems and transferring it via high-efficiency heat exchangers to support
workshop heating. This has partially offset boiler fuel consumption and reduced emissions at the
source. The Company has also upgraded its wastewater treatment aeration systems replacing Roots
blowers with air suspension blowers. This upgrade has led to a 30% reduction in electricity
consumption further curbing indirect emissions from power generation. In its swine operations the
Company has implemented energy-efficient housing designs. During colder months heat recovery
systems are used to preheat incoming ventilation air significantly decreasing natural gas consumption
for heating. Environmental control systems have also been introduced to more precisely regulate fan
operations reducing energy waste from continuous use and further lowering electricity-related
70 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
emissions.Looking ahead the Company will continue to strengthen its energy-saving and emission-reduction
initiatives. These include expanding employee training and awareness programs to enhance all
employees' awareness of energy conservation and emission reduction and drive the Company to make
steady progress in green operations. The Company also plans to explore emerging technologies and
continuously refine its production processes contributing actively to the achievement of national
dual-carbon goals.XV. Overview of Corporate Social Responsibility(CSR) Initiatives
1. CSR implementation overview
External Donations & Public
Amount Remarks
Welfare Projects
Donations for education
Total investment (RMB 10000) 610.15 support public welfare and
poverty alleviation
Of which: cash (RMB 10000) 605.47
In-kind donations (converted
4.68
value RMB 10000)
Detailed description:
As a leading enterprise in agricultural industrialization serving as a vital link between crop cultivation
and agri-food processing the Company has made social responsibility a core part of its identity since its
founding in 1995—an approach embedded in the Wellhope Declaration and Mission. In 2018 it
reaffirmed this commitment by formally adopting the values of Integrity Responsibility and Win-Win as
part of its core philosophy. Through ongoing concrete actions the Company continues to demonstrate
its sense of responsibility as a corporate citizen and its long-term dedication to creating shared value
for society.
1. Fulfilling our mission and creating shared value for the industry
A. Safeguarding grain security and advancing green development
Guided by a strategy focused on resource substitution and efficiency-driven reduction in feed grain use
the Company continuously leverages technological innovation to reduce its dependence on traditional
feed grains and promote the sustainable development of animal agriculture. Over the years it has
established a diversified formulation system promoted multi-grain and multi-protein diet strategies to
improve the utilization efficiency of alternative ingredients of various meals. It has also developed feed
formulas using substitutes like wheat and brown rice to further reduce reliance on corn and soybean
meal. On the environmental front the Company strictly adheres to national regulations and has
developed eco-friendly feed solutions with reduced levels of heavy metals nitrogen and phosphorus
contributing to emission reductions at the source. In addition its subsidiaries regularly carry out
environmental risk inspections and corrective actions to ensure the coordinated progress of industry
development and ecological protection.
71 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B. Upholding quality standards and ensuring food safety
Driven by its vision to become a world-class enterprise in agriculture animal husbandry and food
production the Company has built a full-chain quality management system that covers every
stage—from raw material sourcing to the consumer’s table. In the feed production segment a
three-level quality control structure (headquarter–business unit–subsidiary) ensures strict compliance
with national standards such as the Feed Quality and Safety Management Regulations. This system is
supported by advanced testing technologies and a comprehensive raw material traceability mechanism
enabling closed-loop management throughout the entire production process from procurement to
final delivery. Even before China’s national ban on antibiotics in feed the Company had already
launched a range of antibiotic-free products continuously providing the farming sector with safe and
high-quality nutritional solutions. In the livestock farming segment the Company promotes
standardized production protocols and precision feeding strategies. In the slaughtering and processing
stage it has implemented rigorous quarantine and residue testing systems supported by intelligent
monitoring equipment to ensure that all products meet national food safety standards and effectively
safeguard consumer health.C. Advancing public welfare and creating shared value
Staying true to its founding commitment to serving society the Company has built a comprehensive
public welfare platform that includes disaster relief education initiatives and targeted assistance
programs. Through direct donations and collaboration with charitable organizations such as the Red
Cross the Company and its subsidiaries have continuously provided assistance to disaster-affected
regions disability support initiatives and educational institutions. The Company places strong
emphasis on talent development. It has funded the construction of six Hope primary and secondary
schools and established the “Wellhope Education Fund” which benefits nearly 30 universities across
China through scholarships and dedicated research grants aimed at cultivating talent in the agriculture
livestock and food sectors. The Company also actively organizes internships site visits and
university–enterprise exchange activities to help students connect academic learning with real-world
experience. Guided by the belief that every individual shares responsibility for the well-being and
development of the nation the Company remains committed to supporting China’s livestock industry
education and future talent—demonstrating its long-term commitment to social responsibility as a
corporate citizen.D. Promoting employment and building a strong talent pipeline
The Company considers talent its most valuable asset. In response to a shifting economic landscape it
actively fulfills its social responsibilities by prioritizing employment stability workforce development
and long-term career growth. Each year the Company carries out both campus and social recruitment
to steadily expand its workforce while contributing to broader job creation across society. To support
sustainable talent development the Company has built an integrated framework covering talent
72 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
selection training deployment and retention. New hires receive tailored onboarding programs
designed to help them quickly build the skills needed for success. Clear promotion pathways and
diversified career tracks further enable employees to grow in alignment with both their personal
ambitions and the Company’s long-term strategy.
2. Adhering to compliance and sharing the results of growth
-For shareholders
A. Strengthening corporate governance and enhancing transparency
The Company continues to strengthen its corporate governance framework which consists of the
General Meeting of Shareholders the Board of Directors the Supervisory Board and Executive
Management. This structure ensures clearly defined responsibilities effective checks and balances and
well-regulated operations. Independent directors and members of the Supervisory Board perform their
oversight duties in compliance with applicable laws and regulations promoting transparency and
accountability in the decision-making process. During the reporting period the Company updated key
governance documents—such as the Rules of Procedure for the General Meeting of Shareholders and
the Rules of Procedure for the Board of Directors—in response to evolving regulatory policies. These
updates further improved governance efficiency and ensured alignment with national policy directions
and industry trends. In terms of information disclosure the Company adheres to the principles of
fairness timeliness and accuracy. A comprehensive disclosure system has been established covering
periodic reports (annual semi-annual and quarterly) disclosures of material events and ongoing
communications with investors. In 2024 the Company held several performance briefings to provide
shareholders with timely updates on operational performance and address investor inquiries ensuring
equal access to information for all stakeholders. For seven consecutive years the Company has received
an A rating from the Shanghai Stock Exchange for its excellence in information disclosure.B. Optimizing shareholder returns and reinforcing confidence in long-term value
Amid industry cycles and market pressures the Company remains committed to safeguarding
shareholder interests. While maintaining stable operations it continues to refine its return mechanisms
to ensure a strong alignment between long-term enterprise value and shareholder returns. Since its IPO
in 2014 the Company has upheld its philosophy of sharing value with shareholders. The total capital
returned through cash dividends and share repurchases has now exceeded the amount raised from its
initial public offering. In 2024 in response to a cyclical downturn the Company conducted two rounds
of share buybacks repurchasing nearly 40 million shares at a total cost of RMB 287 million. These
efforts helped optimize the capital structure stabilize market expectations and signaled management’s
strong confidence in the Company’s long-term prospects. Looking ahead the Company will continue to
formulate its shareholder return strategy based on operational performance and evolving capital
market conditions aiming to deliver steady sustainable value while supporting long-term growth.-For employees
73 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
A. Optimizing compensation structures and strengthening long-term incentives
The Company follows a people-centered approach to human resources grounded in fairness
transparency and performance. It has built a comprehensive compensation system that includes base
salary performance-based bonuses and a full suite of employee benefits. This system is regularly
benchmarked against leading industry peers to ensure internal equity and market competitiveness. To
further attract and retain key talent the Company launched an employee stock ownership plan in 2024.Under the plan 426 participants including members of the management team technical specialists
and other critical personnel acquired repurchased shares through a targeted transfer arrangement.This incentive model is designed to align individual interests with long-term Company performance by
promoting shared benefits and shared responsibilities. It helps unlock the potential of core teams and
supports the Company’s long-term sustainable growth.B. Developing tiered training systems and expanding career pathways
The Company continues to refine its training and development framework to support strategic priorities
across all business units. It provides role-specific courses and curated learning resources to helpemployees strengthen job-related skills and unlock their full potential. For example the “WellhopeManagement Bootcamp” focuses on building organizational effectiveness and leadership capabilities
especially among senior and mid-level managers. In addition employees are encouraged to take part in
industry conferences and cross-disciplinary learning programs to expand their strategic thinking and
deepen sector knowledge. To support long-term growth the Company has implemented a dual-track
career development system that offers both managerial and technical advancement paths. Employees
can choose the route that best fits their strengths with the flexibility to switch between tracks as their
careers evolve. This approach ensures talent is fully leveraged while enabling individuals to grow
alongside the organization.C. Fostering a supportive workplace and enhancing employee wellbeing
In addition to meeting all statutory obligations such as social insurance and housing fund contributions
the Company offers a range of supplementary benefits including commercial insurance annual health
checkups. It also runs the Wings of Love Fund an internal charitable initiative that provides care and
support for employees in need. For 18 consecutive years the Company has awarded scholarships to
employees whose children are admitted to national universities demonstrating the Company’s ongoing
commitment to education and encouraging employees to contribute to talent development for the
nation and society. Financial assistance is also available to employees and their families facing serious
illness natural disasters or other unforeseen challenges. To promote work–life balance and strengthen
team cohesion the Company regularly organizes a variety of cultural and engagement activities. These
efforts foster open communication meaningful connections and a strong sense of belonging across the
organization.
74 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
-For customers
A. Delivering tailored solutions and a high-quality product portfolio
The Company follows a market-driven R&D strategy and has developed an end-to-end innovation
framework—from identifying customer needs for product development and performance validation. Its
R&D team closely tracks trends in the swine ruminant and poultry sectors formulating targeted
nutrition plans and feeding programs to address specific production challenges. For instance to meet
the nutritional demands of re-fattening pigs or improve survival rates in broiler production the
Company has launched specialized products and dynamically adjusted feeding protocols. It has also
implemented an iterative product development model that integrates continuous optimization of
existing offerings with the rollout of new formulations. These efforts aim to boost farming efficiency
reduce operational costs and deliver personalized solutions for a diverse client base.B. Enhancing technical services to drive shared success
The Company is committed to building a comprehensive service system that integrates technical
expertise management support and resource connectivity delivering end-to-end solutions to help
customers enhance their farming performance. A dedicated team of livestock specialists veterinarians
and nutritionists provides on-site one-on-one technical support tailored to the specific conditions of
each farm. Services include customized guidance on farm management processes disease prevention
strategies and other practical operational challenges. To broaden access to expert knowledge the
Company has also developed a digital support platform that offers short-form educational videos and
livestreamed training sessions. These resources equip farmers with up-to-date technical know-how and
real-time market insights. For large-scale farming operations the Company provides full-cycle
management solutions covering everything from feed formulation and production planning to data
tracking and cost control. This one-stop model helps customers reduce costs improve efficiency and
achieve mutually beneficial outcomes.For over 30 years Wellhope has stayed true to its founding values by integrating social responsibility
into its strategic development. Looking ahead the Company will continue to adopt a global perspective
optimize grain resource utilization strengthen food safety systems and support national food security
and industry progress. In its pursuit of sustainable development Wellhope is committed to acting as a
responsible corporate citizen and contributing to a resilient sustainable development of the industries.XVI. Efforts to Consolidate Poverty Alleviation Achievements and Advance Rural Revitalization
Poverty alleviation and rural revitalization
Amount Remarks
projects
Total investment (RMB 10000) 1165.84 See details below
Of which: cash (RMB 10000) 1165.84 /
In-kind contribution (RMB 10000) / /
75 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Forms of assistance (such as poverty
alleviation by developing industries Poverty alleviation by
/
offering job opportunities and supporting developing industry
education)
Detailed description:
Although China has declared victory in its fight against poverty ensuring these gains are sustained and
fully integrated into long-term rural revitalization remains a continuing challenge. The 2024
Government Work Report reaffirmed China's commitment to upholding efforts to strengthen work
related to agriculture rural areas and farmers highlighting the need for sustained and practical efforts
to advance rural revitalization. Rural revitalization remains a cornerstone of China's strategy to build a
strong agricultural country. As a leading enterprise in agricultural industrialization the Company
actively participates in industrial poverty alleviation to support the nation’s efforts in consolidating
poverty alleviation achievements and advancing rural revitalization. During the reporting period the
Company leveraged its expertise and scale to advance rural development enhance agricultural
productivity and increase farmer incomes. The Company’s Subsidiaries including Pingyuan Wellhope
Food Processing Company Dalian Heyuan Animal Husbandry Company Wafangdian Huinong Poultry
Company Daqing Wellhope Food Company and Hebei Taihang Wellhope Food Company partnered
with local governments to implement industry-based poverty alleviation programs as part of broader
rural revitalization efforts. These programs created employment opportunities for low-income
households and encouraged their participation in broiler farming. Through a profit-sharing mechanism
participating households earned additional income total dividends disbursed under these programs
reached RMB 11.56 million in 2024.
76 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Section V Important Disclosures
I. Fulfillment of Commitments
Whether
Background there is a Whether
Type of Commitment Date of making Commitment
of Content of commitment deadline performs
commitment party commitment period
commitment for strictly
fulfillment
Nature person I warrant and commit that I will not directly or indirectly develop operate
Horizontal shareholders or assist in the operation or participate in or engage in any activity that is
Long-term
competition holding more competitive with the business of Wellhope if Wellhope will increase any March 2 2011 Yes Yes
valid
management than 5% of the business scope after the date of signing this commitment I promise to give
shares up the business.Legal person
Our company warrants and commits that our company will not directly or
shareholders
Related party indirectly develop operate or assist in the operation or participate in or
holding more Long-term
transaction engage in any activity that is competitive with the business of Wellhope if March 2 2011 Yes Yes
than 5% of the valid
management Wellhope will increase any business scope after the date of signing this
Commitment shares-Heli
commitment our company promises to give up the business.relating to Investment
IPO Jin Weidong
The controlling shareholder Jin Weidong and persons acting in concert
Wang Fengjiu
with him undertake that there are no false records misleading statements
Shao Caimei Long-term
Other or material omissions in the prospectus of IPO and its abstract and shall March 2 2011 Yes Yes
Wang valid
bear individual and joint legal liabilities for its authenticity accuracy and
Zhongtao
completeness.Ding Yunfeng
The Company undertakes that there are no false records misleading
statements or material omissions in the prospectus of IPO and its abstract Long-term
Other Wellhope March 2 2011 Yes Yes
and it shall bear individual and joint legal liabilities for its authenticity valid
accuracy and completeness.Measures taken by the Company for filling dilution resulting from issuing
bonds.Commitment 1. Accelerating the implementation of fund-raising projects to enhance
Long-term
relating to Other Wellhope operational efficiency and profitability and reduce the risk of dilution. July 2 2021 Yes Yes
re-Financing 2. Strengthening the management of fund-raising and ensure the
valid
standardized and effective use of fund-raising.
3. Further strengthening business management and internal control
77 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
improving the efficiency of the Company's operations reducing operating
costs comprehensively and effectively controlling the operational and
management risks.
4. Strictly implementing the Company's dividend policy strengthening the
investor return mechanism to protect the interests of the Company's
shareholders especially the small and medium-sized shareholders. Future
operating results are affected by a variety of macro and micro factors and
are subject to uncertainty and the measures taken by the Company for
filling dilution are not equivalent to guaranteeing the Company's future
profits.
5. To establish a more effective incentive and competition mechanism as
well as a scientific reasonable and practical talent introduction and
training mechanism to build a market-oriented talent operation mode
and to provide a reliable talent guarantee for the sustainable development
of the Company.To ensure that the remedial measures for the dilution of immediate
returns resulting from issuing bonds can be effectively implemented the
controlling shareholder and actual controller of the Company make the
following commitments.
1.I will not interfere in the operation and management activities of the
Company beyond its authority and will not encroach upon the interests of
Controlling the Company.shareholder 2.If I violate or refuse to perform the above commitments I agree to bear Long-term
Other
and actual the corresponding legal liabilities in accordance with the relevant
July 2 2021 Yes Yes
valid
regulations and rules formulated or issued by CSRC Shanghai Stock
controller
Exchange and other securities regulatory authorities.
3.Prior to the completion of the bond if the regulatory authorities make
other detailed provisions on the remedial measures for diluted immediate
returns and its undertakings and when the above undertakings fail to
meet the detailed requirements of the regulatory authorities I will make
supplementary undertakings in accordance with the relevant provisions.All board directors senior managers made the following undertakings to
All board ensure that the remedial measures for the dilution of immediate returns
Commitment resulting from issuing bonds can be effectively implemented.directors Long-term
relating to Other 1.I will not transfer any interests to other entities or individuals without July 2 2021 Yes Yes
senior valid
re-Financing consideration or with unfair conditions nor otherwise damage the
managers interests of the Company.
2.I will impose constraints on position-related consumption behavior.
78 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
3.I will not make any investment or consumption activity irrelevant to my
performance of duties using the Company’s assets.
4. I will propel to link the remuneration policy formulated by the Board or
the Remuneration Committee with the implementation of the Company’s
remedial measures for returns.
5. In the case that any equity incentive scheme (if any) is introduced
hereafter I will actively support to link the vesting conditions of equity
incentive with the implementation of the Company’s remedial measures
for returns.
6. Prior to the completion of the Bond if the regulatory authorities make
other detailed provisions on the remedial measures for diluted immediate
returns and its undertakings and when the above undertakings fail to
meet the detailed requirements of the regulatory authorities I will make
supplementary undertakings in accordance with the relevant provisions.
7. I promise following the regulations of this commitment. If I fail following
the regulations which lead to any financial loss to the company or
stockholders I will take responsibility of compensation.
8.The above commitments are my true intentions. I voluntarily accept the
supervision of securities regulatory authorities self regulatory
organizations and the public. If I fail to fulfill the above commitments I will
assume corresponding responsibilities in accordance with relevant laws
and regulations and the requirements of regulatory authorities.
79 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
II. Analysis of Changes in Accounting Policies Estimates and Material Error Corrections
1. Analysis of changes in accounting policies and estimates
A. Adoption of Accounting Standards Interpretation No. 17
On October 25 2023 the Ministry of Finance issued Accounting Standards for Business Enterprises
Interpretation No. 17 (Caikuai [2023] No. 21) which came into effect on January 1 2024. The Company
adopted the interpretation as of the effective date. Its implementation had no material impact on the
Company’s financial statements for the reporting period.B. Adoption of Accounting Standards Interpretation No. 18
In March 2024 the Ministry of Finance released the 2024 Compilation of Application Guidelines for
Accounting Standards for Business Enterprises and subsequently issued Interpretation No. 18 on
December 6 2024. Under this interpretation warranty-related expenses are required to be classified
as operating costs. The adoption of this interpretation had no material effect on the Company’s
financial statements for the reporting period.
2. Communication with the former accounting firm
The Company conducted sufficient communication with its former accounting firm Suyajincheng CPA
LLP regarding the change of auditor. The former firm raised no objections.III.Accounting Firm Engaged by the Company
RMB 10000
Former Auditor Current Auditor
Name of domestic accounting
Suyajincheng CPA LLP RSM CHINA CPA LLP
firm
Audit fees 120 118
Number of years as the
131
Company’s domestic auditor
Name of certified public Huang Xiao Zhao Songhe
Zhou Qiong Wang Lei
accountants (CPAs) Zhang Yuanyuan
Huang Xiao: 1 year
Cumulative years of audit Zhou Qiong: 1 year
Zhao Songhe: 1 year
service by CPAs Wang Lei: 5 years
Zhang Yuanyuan: 1 year
Name Payment (RMB 10000)
Accounting firm of internal
RSM CHINA CPA LLP 40
control
Explanation of the engagement and dismissal of accounting firms:
On September 2 2024 the Company’s third extraordinary general meeting approved the proposal to
change its accounting firm. RSM CHINA CPA LLP was appointed as the auditor for the 2024 fiscal year
replacing Suyajincheng CPA LLP whose engagement was discontinued.IV. Major litigation and Arbitration Matters
Non
80 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
V. Statement of the Integrity of the Company its Controlling Shareholder and Actual Controller
during the Reporting Period
During the reporting period neither the Company nor its controlling shareholder or actual controller
was involved in any failure to comply with effective court rulings nor were there any significant
outstanding debts that remained unpaid upon maturity.VI. Material Related-Party Transactions
1. Related-party transactions arising from ordinary business activities
No matters requiring separate disclosure
81 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
RMB 10000
Transaction
Related Party Relationship Transaction type Transaction content Pricing principle Settlement mode
amount
Associated
Anshan Fengsheng Food Company Selling product Live broiler Comparable uncontrolled price 208.26 Bank transfer
company
Associated
Anshan Jiuguhe Food Company Selling product Live broiler Comparable uncontrolled price 1055.09 Bank transfer
company
Associated
Dalian Chengsan Food Group Company Selling product Feed raw materials Comparable uncontrolled price 408.57 Bank transfer
company
Dandong Wellhope Chengsan Animal Associated
Selling product Feed raw materials Comparable uncontrolled price 646.01 Bank transfer
Husbandry Company company
Associated
Linghai Jiuguhe Feed Company Selling product Feed raw materials Comparable uncontrolled price 5620.41 Bank transfer
company
Tai’an Jiuguhe Agriculture Development Associated
Selling product Feed raw materials Comparable uncontrolled price 12512.61 Bank transfer
Company company
Associated
Dalian Sida Food Company Selling product Live broiler Comparable uncontrolled price 18945.23 Bank transfer
company
Associated
Shandong Fengkang Food Company Selling product Live broiler Comparable uncontrolled price 61219.66 Bank transfer
company
Associated
Harbin Weierhao Trading Company Selling product Feed raw materials Comparable uncontrolled price 7233.78 Bank transfer
company
Associated
Dazhou Wellhope Bio-Tech Company Selling product Feed Comparable uncontrolled price 1720.36 Bank transfer
company
Dandong Wellhope Chengsan Food Group Associated
Selling product Feed raw materials Comparable uncontrolled price 5.49 Bank transfer
Company company
Associated Purchasing Broiler parts
Anshan Jiuguhe Food Company Comparable uncontrolled price 1079.72 Bank transfer
company product products
Associated Purchasing
Dalian Chengsan Food Group Company Live broiler Comparable uncontrolled price 5107.44 Bank transfer
company product
Gongzhuling Corn Purchasing and Storing Associated Purchasing
Feed raw materials Comparable uncontrolled price 1305.63 Bank transfer
Company company product
Associated Purchasing Broiler parts
Jinzhou Jiufeng Food Company Comparable uncontrolled price 1843.23 Bank transfer
company product products
Associated Purchasing
Linghai Jiuguhe Feed Company Other products Comparable uncontrolled price 72.44 Bank transfer
company product
Tai’an Jiuguhe Agricultural Development Associated Purchasing
Feed Comparable uncontrolled price 3252.46 Bank transfer
Company company product
Jilin Hengfeng Animal Health Products Associated Purchasing Veterinary drugs Comparable uncontrolled price 19.74 Bank transfer
82 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Company company product and vaccines
Associated Purchasing
Harbin Weierhao Trading Company Feed raw materials Comparable uncontrolled price 1867.15 Bank transfer
company product
Associated Purchasing Broiler parts
Beipiao Hongfa Food Company Comparable uncontrolled price 939.32 Bank transfer
company product products
Associated Purchasing
Anshan Fengsheng Food Company Feed raw materials Comparable uncontrolled price 274.75 Bank transfer
company product
Hebei Taihang Wellhope Animal Associated Purchasing
Live broiler Comparable uncontrolled price 5101.51 Bank transfer
Husbandry Company company product
Total / 130438.85 /
Details of significant sales returns Non
The Company and its associates have established long-term cooperative
relationships based on mutual familiarity and understanding. These relationships
have enhanced mutual trust in each other's products thereby reducing
transaction costs improving efficiency and minimizing the risk of commercial
disputes. Procurement of key raw materials from related parties ensures reliable
quality. By participating in the management of these entities or exerting influence
the Company can secure stable long-term supply while also supporting the related
Explanation of related-party transactions
parties by easing their sales pressure and enabling them to focus on production.All related-party transactions are conducted to meet the Company’s normal
operational needs. The pricing of purchases and sales is determined based on
prevailing market prices for comparable products. These transactions comply with
applicable laws and regulations the Company’s Articles of Association and its
Related-Party Transaction Management Policy. No shareholder interests have been
harmed as a result of these transactions.
83 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
2. Guarantee information
RMB 10000
Guarantees provided to external parties (excluding subsidiaries)
Total amount of guarantees provided during the reporting period (excluding subsidiaries)
Outstanding guarantee balance as of the end of the reporting period (A)
Guarantees provided by the Company and its subsidiaries to subsidiaries
Total amount of guarantees provided during the reporting period 145450.00
Outstanding guarantee balance as of the end of the reporting period (B) 61862.63
Total guarantees provided by the Company (including guarantees to subsidiaries)
Total guarantee amount (A + B) 61862.63
Total guarantees as a percentage of the Company’s net assets 9.24%
Breakdown of key guarantee exposures:
Amount of guarantees provided to shareholders the actual controller and their related parties (C)
Amount of guarantees provided to entities with an asset-liability ratio exceeding 70% (D) 13191.57
Amount of total guarantees exceeding 50% of the Company’s net assets (E)
Total of the above three types of guarantees (C + D + E) 13191.57
84 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
VII. Explanation of Progress in the Use of Raised Funds
1. The use of raised funds
RMB 10000
Cumulative
Cumulative
investment Proportion of
Committed amount of raised Amount invested Total amount of
Source of raised Date of fund Net proceeds of progress as of the current year
Total funds raised investment amount funds invested as during the current raised funds with
funds receipt raised funds end of the investment to net
in the prospectus of the end of the year changed purpose
reporting period raised funds (%)
reporting period
(%)
Issuance of
April 28 2022 150000.00 148988.35 148988.35 75992.88 51.01
convertible bonds
2. Fund-raising project details
RMB 10000
Cumulative
amount of Cumulative Whether the Whether there
Profit
Planned total Amount raised funds investment Date when the Whether investment has been any
Whether the realized
Projects invested by the raised Source of Nature of investment invested invested as progress as of project reached the project progress is in significant
investment during the
founds raised funds project amount of during the of the end of the end of the its intended is line with the change in
has changed current
raised funds current year the reporting usable state completed planned project
year
reporting period (%) schedule feasibility
period
Wellhope Nongda Feed
Issuance of Production
Company--complete feed mill
convertible and No 8400.00 7988.44 95.10 2023 No Yes -449.02 No
with annual capacity of 300000
bonds construction
tons
Anhui Wellhope Agri-Tech
Company--pig feed project with Issuance of Production
annual capacity of 300000 tons convertible and No 11400.00 - - 2025 No N/A N/A No
ruminant feed project with bonds construction
annual capacity of 150000 tons
Heilongjiang Wellhope Agri-Tech
Issuance of Production
Company--creep feed and
convertible and No 3900.00 262.40 6.73 2025 No N/A N/A No
nursery feed project with annual
bonds construction
capacity of 100000 tons
Fuxin Wellhope Agriculture and
Animal Husbandry Issuance of Production
Company--pig breeding convertible and No 17400.00 12818.20 73.67 2023 No Yes -979.66 No
integration project producing bonds construction
150000 heads of piglet per year
Lingyuan Wellhope Agriculture
and Animal Husbandry Issuance of Production
Company--breeding farm with convertible and No 24688.35 17.52 0.07 2025 No N/A N/A No
annual production of 10000 bonds construction
heads of pig breeders
Anhui Wellhope Food Issuance of Production Slaughter project
No 14400.00 9200.87 63.89 No N/A -980.40 No
Company--pig integration convertible and completed in
85 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
project slaughtering 1 million bonds construction 2023
heads of live pig further
processing 120000 tons of pork
per year with cold chain logistics
Pingyuan Wellhope Food
Processing Company--further
Issuance of Production
processing project with annual
convertible and No 23800.00 705.45 2.96 2025 No N/A N/A No
capacity of 30000 tons of
bonds construction
prepared food and cooked
food(broiler)
Replenishment
Issuance of of working
Replenishment of working
convertible capital No 45000.00 45000.00 100.00 N/A No Yes N/A No
capital
bonds repayment of
bank loans
Total / / / 148988.35 75992.88 / / / / -2409.08 /
3.Other use of raised funds during the reporting period
A. Preliminary investment and replacement of funds in fundraising investment projects
On May 24 2022 the Company convened the 11th meeting of the 7th Board of Directors and the 9th meeting of the 7th Supervisory Board during which the
proposal regarding the use of proceeds from convertible corporate bonds to reimburse self-raised funds previously invested in fundraising investment projects was
approved. The Company was authorized to use RMB 240.20 million of the proceeds to replace self-raised funds that had been used in advance for fundraising
investment projects and to cover issuance expenses. The Company's independent directors and its sponsor Galaxy Securities each issued explicit consent opinions
on this matter. Suya Jincheng Certified Public Accountants LLP conducted a special audit of the Company’s use of self-raised funds for pre-investment in fundraising
projects as of May 24 2022 and issued a special verification report (Suya Verification [2022] No. 29).B. Use of idle raised funds to temporarily replenish working capital
On April 25 2024 the Company convened the 3rd meeting of the 8th Board of Directors and the 3rd meeting of the 8th Supervisory Board at which the proposal
to use a portion of idle raised funds to temporarily replenish working capital was approved. To maximize shareholder value and improve the efficiency of fund
utilization—without affecting the progress and use of fundraising investment projects—the Company proposed to use up to RMB 600 million of idle raised funds
for this purpose with a usage period not exceeding 12 months from the date of board approval.As of December 31 2024 the Company had utilized RMB 600 million of idle raised funds to temporarily replenish working capital.
86 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Section VI Changes in Common Shares and Shareholder Information
I. Changes in Common Shares
1. Changes of common shares
Increase or decrease
Before changing After changing
in this year
Issuing new
Shares Percentage % Subtotal Shares Percentage %
shares
1. Shares with selling
restrictions
A. State-owned
shares
B. Shares held by
state-owned entity
C. Shares held by
other domestic
investors
D. Shares held by
foreign investors
2. Shares without
919433663100.00785785919434448100.00
selling restrictions
A. RMB ordinary
919433663100.00785785919434448100.00
shares
B. Foreign shares
listed domestically
C. Foreign shares
listed overseas
3. Total number of
919433663100.00785785919434448100.00
shares
2. Explanation of changes in shares
On April 22 2022 the Company publicly issued RMB 1.5 billion of convertible corporate bonds named
Wellhope Convertible Bonds (bond code: 113647). From January 1 2024 to December 31 2024 a total
of RMB 8000 of Wellhope Convertible Bonds were converted into the Company’s shares resulting in
785 shares being converted. The total number of shares of the Company increased from 919433663
shares to 919434448 shares.II. Securities Issuance and Listing Status
1. Changes in total share capital and shareholder structure and in the Company’s asset and liability
structure
During the reporting period a portion of the Company’s convertible bonds were converted into shares
increasing the total share capital from 919433663 shares to 919434448 shares. There was no change
in the Company’s control rights. At the beginning of the reporting period the Company’s total assets
amounted to RMB 14.937 billion total liabilities were RMB 7.322 billion and the asset-liability ratio
stood at 49.02%. By the end of the reporting period total assets amounted to RMB 14.883 billion total
liabilities were RMB 7.305 billion and the asset-liability ratio was 49.09%.
87 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
III. Shareholder and Actual Controller
1.Total shareholders
Number of shareholders at the end of the reporting period
22779
(accounts)
Number of shareholders at the end of the month preceding the
23234
disclosure date of the annual report (accounts)
2.Top ten shareholders and top ten shareholders holding unrestricted shares as at the end of the
reporting period
Shareholding of top ten shareholders
Total shares Pledged or Frozen
Changes in Restricted Nature of
Name of shareholder held at the %
this year shares held Status Shares shareholder
period-end
Domestic
Jin Weidong 149549498 16.27 -
individual
Foreign
DE HEUS MAURITIUS 82303939 8.95 -
legal entity
Domestic
Ding Yunfeng 81929558 8.91 -
individual
Domestic
Shao Caimei 49773878 5.41 -
individual
Domestic
Zhang Tiesheng 48360000 5.26 -
individual
Changzhou Heli
Venture Capital
48360000 5.26 - Other
Partnership (Limited
Partnership)
Domestic
Wang Fengjiu 47964602 5.22 Pledged 9980000
individual
Wellhope Foods Co.Ltd. special securities
25987732 46944311 5.11 - Other
account for share
repurchase
Domestic
Wang Zhongtao 46625229 5.07 -
individual
Hong Kong Securities
Clearing Company 9336192 17885588 1.95 Unknown Other
Limited
Top ten shareholders holding unrestricted shares
Unrestricted shares Shares by type
Name of shareholder
held Type Shares
Jin Weidong 149549498 RMB common stock 149549498
DE HEUS MAURITIUS 82303939 RMB common stock 82303939
Ding Yunfeng 81929558 RMB common stock 81929558
Shao Caimei 49773878 RMB common stock 49773878
Zhang Tiesheng 48360000 RMB common stock 48360000
Changzhou Heli Venture Capital Partnership (Limited
48360000 RMB common stock 48360000
Partnership)
Wang Fengjiu 47964602 RMB common stock 47964602
Wellhope Foods Co. Ltd. special securities account for
46944311 RMB common stock 46944311
share repurchase
Wang Zhongtao 46625229 RMB common stock 46625229
Hong Kong Securities Clearing Company Limited 17885588 RMB common stock 17885588
In 2021 the Company repurchased a total of 20956579 shares
Explanation of the special account for repurchasing the
through bidding on the Stock Exchange of which 14000000
Company’s stock
shares were transferred to the Company’s employee stock
88 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
ownership plan account. In 2024 the Company repurchased a
total of 39987732 shares through bidding on the Stock Exchange.According to the provisions of the Company’s 2024 Employee
Explanation of proxy voting rights entrusted voting
Stock Ownership Plan the 14000000 shares held in the securities
rights and waiver of voting rights by the above
account of the employee stock ownership plan shall waive their
shareholders
voting rights at shareholders’ meetings during the plan’s duration.
1. Jin Weidong Wang Fengjiu and Shao Caimei are acting in
concert.Relationship of above shareholders or statement on 2. Jin Weidong is the actual controller of Changzhou Huli Venture
parties acting in concert Capital Partnership (Limited Partnership).
3. No other relationships or concerted actions have been identified
among the remaining shareholders.IV. Controlling Shareholder and Ultimate Controller
1. Controlling shareholder
A. Natural individual
Name Jin Weidong
Nationality China
Whether holding residency in other
No
countries or regions
Primary occupation and position Chairman of Wellhope Foods Co. Ltd.B. Diagram of ownership and control relationship between the Company and its controlling
shareholder
Note: As of December 31 2024 Jin Weidong directly held 149549498 shares of the Company
representing 16.27% of the total share capital. He indirectly controlled 5.26% of the Company's voting
rights through his control over Changzhou Heli. In addition pursuant to the Letter of Confirmation and
Undertaking of Concerted Action he jointly controlled 10.63% of the Company's voting rights together
with Wang Fengjiu (holding 5.22%) and Shao Caimei (holding 5.41%). In total Jin Weidong controlled
32.16% of the Company's voting rights and is the controlling shareholder of the Company.
89 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
2. Ultimate controller
A. Natural individual
Name Jin Weidong
Nationality China
Whether holding residency in other countries
No
or regions
Primary occupation and position Chairman of Wellhope Foods Co. Ltd.B. Diagram of ownership and control relationship between the Company and its ultimate controller
Note: As of December 31 2024 Jin Weidong directly held 149549498 shares of the Company
representing 16.27% of the total share capital. He indirectly controlled 5.26% of the Company’s voting
rights through his control over Changzhou Heli. In addition pursuant to the Letter of Confirmation and
Undertaking of Concerted Action he jointly controlled 10.63% of the Company’s voting rights together
with Wang Fengjiu (holding 5.22%) and Shao Caimei (holding 5.41%). In total Jin Weidong controlled
32.16% of the Company’s voting rights and is the ultimate controller of the Company.
V. Implementation of Share Repurchase during the Reporting Period
Share repurchase plan through bidding on the Stock
Name of share repurchase plan
Exchange
Disclosure date of the repurchase plan June 25 2024
Planned repurchase volume and percentage of
15000000 to 30000000 shares; 1.63% – 3.26%
total share capital
Planned repurchase amount (RMB 10000) 15000-30000
No more than 3 months from the date of approval by
Planned repurchase period
the Board of Directors
For resale; any portion not resold within the specified
Purpose of the repurchase
period will be cancelled in accordance with the law
Number of shares already repurchased 29759468 shares
The second share repurchase plan through bidding on
Name of share repurchase plan
the Stock Exchange
Disclosure date of the repurchase plan October 30 2024
Planned repurchase volume and percentage of
9174311 – 18348623 shares; 1.00% – 2.00%
total share capital
90 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Planned repurchase amount (RMB 10000) 10000-20000
No more than 12 months from the date of approval
Planned repurchase period
by the Board of Directors
For conversion into convertible bonds issued by the
Purpose of the repurchase
Company
Number of shares already repurchased 10228264 shares
VI. Situation Related to Preferred Shares
Not applicable
91 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Section VII Corporate Bond
I. Status of Convertible Bonds
1. Issuance of convertible bonds
With the approval of the China Securities Regulatory Commission the Company publicly issued 15
million convertible bonds on April 22 2022 at an issue price of RMB 100.00 per bond with a total
issuance amounting to RMB 1.5 billion and a term of six years. The Company’s convertible bonds were
approved for listing and commenced trading on the Shanghai Stock Exchange on May 18 2022 under
the bond name “Wellhope Convertible Bond” and bond code “113647”.
2. Status of convertible bondholders and guarantors during the reporting period
Name of convertible bonds Wellhope convertible bonds
Number of convertible bondholders at the end of the period 6922
Guarantors of the Company's convertible bonds Not applicable
The top ten convertible bondholders are as follows:
Bonds held at
Name of bondholders period end Percentage %
(RMB)
China Merchants Bank Co. Ltd. – Bosera CSI Convertible Bond and
634980004.33
Exchangeable Bond ETF
China Minsheng Banking Corp. Ltd. – Everbright Pramerica Credit
496590003.39
Tianyi Bond Fund
National Social Security Fund Portfolio 105 47380000 3.23
China Asset Management Yannianshou No. 9 Fixed Income Pension
458720003.13
Product – China Merchants Bank Co. Ltd.E Fund Yitian Allocation Mixed Pension Product – Industrial and
432120002.95
Commercial Bank of China Limited
Zhong Baoshen 40466000 2.76
China Construction Bank Corporation – E Fund Dual Bond Enhanced
370460002.53
Bond Fund
Industrial and Commercial Bank of China Limited – Fullgoal Steady
344470002.35
Enhanced Bond Fund
Industrial and Commercial Bank of China Limited – Fullgoal Tianying
337990002.30
Bond Fund (LOF)
Industrial and Commercial Bank of China Limited – E Fund Anxin
288820001.97
Return Bond Fund
3. Changes in convertible bonds during the reporting period
RMB
Changes (increase or decrease)
Bond Bonds
Before changing After changing
name converted to Redemption Repurchase
shares
Wellhope
convertible 1467008000 8000 1467000000
bonds
92 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Cumulative conversion of convertible bonds during the reporting period
Name of convertible bonds Wellhope convertible bonds
Conversion amount during the reporting period
8000
(RMB)
Number of bonds converted into shares during
785
the reporting period
Cumulative conversions of convertible bonds
3216252
(Shares)
Cumulative converted shares as a percentage of
the Company’s total issued shares before 0.35
conversion (%)
Outstanding unconverted amount (RMB) 1467000000
Unconverted bonds as a percentage of total
97.80
convertible bonds (%)
4. Adjustments of the conversion price
Name of convertible bonds Wellhope convertible bonds
Conversion price
Conversion price
after adjustment Disclosure time Disclosure media Explanation
adjustment date
(RMB)
Due to the
Securities Journal
buy-back and
Shanghai Securities
cancellation of
News Securities
June 23 2022 10.26 June 20 2022 5.74 million
Times and SSE
restricted
website
shares by the
(www.sse.com.cn)
Company
Securities Journal
Shanghai Securities Due to the
News Securities implementation
May 26 2023 10.14 May 22 2023
Times and SSE of the 2022
website annual dividend
(www.sse.com.cn)
Latest conversion price at the end of
10.14
the reporting period
5. The Company’s debt position credit rating changes and cash arrangements for debt repayment in
future years
A. Debt position
As of the end of the reporting period the Company’s total liabilities amounted to RMB 7.305 billion
comprising RMB 3.920 billion in current liabilities and RMB 3.385 billion in non-current liabilities. The
debt-to-asset ratio was 49.09%.B. Credit rating changes
During the reporting period United Credit Ratings Co. Ltd. issued the 2024 Tracking Credit Rating
Report on the Public Issuance of Convertible Corporate Bonds by Wellhope Foods Co. Ltd. on June 17
2024. According to the report the Company’s issuer credit rating was AA and the credit rating of the
“Wellhope Convertible Bond” was also AA both with a stable outlook. The ratings remained unchanged
93 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
from the previous assessment.C. Cash arrangements for debt repayment in future years
The principal and interest payments for the Company’s convertible bonds in future years will primarily
be funded by cash flows generated from its core operating activities. The Company maintains a sound
debt repayment record and has no history of overdue bank loans.
94 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Section VIII Financial Statements
I. Audit Report
Audit Report
RSM China Audit Report No. [2025] 110Z0173
To all the shareholders of Wellhope Foods Co. Ltd.
1. Opinion
We have audited the financial statements of Wellhope Foods Co. Ltd. (hereinafter referred to as "the
Company") which comprise the consolidated and parent company balance sheets as at December 31
2024 the consolidated and parent company income statements the consolidated and parent company
cash flow statements the consolidated and parent company statements of changes in owners’ equity
for the year then ended and the notes to the financial statements.In our opinion the accompanying financial statements have been prepared in all material respects in
accordance with the Accounting Standards for Business Enterprises (ASBE) and present fairly the
financial position of the Company and its subsidiaries as of December 31 2024 as well as their
operating results and cash flows for the year then ended.
2. Basis for Opinion
We conducted our audit in accordance with the Chinese Standards on Auditing (CSAs). Our
responsibilities under those standards are further described in the section titled "Auditor’s
Responsibilities for the Audit of the Financial Statements" of this report.We are independent of Wellhope Foods Co. Ltd. in accordance with the Code of Ethics for Chinese
Certified Public Accountants and we have fulfilled our other ethical responsibilities in accordance with
the requirements of the Code. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
3.Key Audit Matters
Key audit matters are those matters that in our professional judgment were of most significance in our
audit of the financial statements for the current period. These matters were addressed as part of our
audit of the financial statements as a whole and in forming our audit opinion thereon. We do not
provide a separate opinion on these matters.A. Revenue recognition
1) Description of the matter
In 2024 the Company reported revenue of RMB 32.545 billion representing a 9.52% decrease
compared to the prior year. Revenue from the feed business declined by 24.05% while revenue from
the broiler and swine farming businesses increased by 1.14% and 28.79% respectively. Given that
revenue is one of the Company’s key performance indicators we identified revenue recognition as a
95 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
key audit matter. Refer to Note VII-46(Revenue and Cost) to the financial statements.
2) How the matter was addressed in the audit
Our audit procedures in response to this matter included among others:
a. Obtaining an understanding of and assessing the design and implementation of internal controls
over the sales process and testing the operating effectiveness of key controls related to revenue
recognition;
b. Reviewing a sample of sales contracts to identify performance obligations assess the timing of
revenue recognition and evaluate whether judgments regarding the transfer of control were consistent
with the Company’s accounting policies and the Accounting Standards for Business Enterprises (ASBE);
c. Performing analytical procedures to identify significant or unusual fluctuations in revenue and gross
profit and assessing the reasonableness of those variances;
d. Testing revenue transactions on a sample basis to verify occurrence and cut-off. This included:
a) Examining supporting documents such as sales contracts purchase orders invoices and customer
delivery receipts;
b) Sending confirmations for selected accounts receivable balances and revenue amounts;
c) Performing cut-off testing of revenue recorded before and after the balance sheet date to assess
whether it was recognized in the appropriate accounting period.Based on the procedures performed we did not identify any material misstatements related to revenue
recognition.B. Share of profit from investments accounted for using the equity method
1) Description of the matter
In 2024 the Company recognized income of RMB 129.86 million from long-term equity investments
accounted for using the equity method representing an increase of RMB 263.26 million compared with
the same period in the prior year. Given the material impact of this income on the Company’s financial
statements we identified it as a key audit matter. Refer to Note VII-53(Income from investment) to the
financial statements for further details.
2) How the matter was addressed in the audit
Our audit procedures in response to this matter included among others:
a. Understanding and evaluating the design and implementation of internal controls related to the
recognition of income under the equity method;
b. Reviewing the articles of association and investment agreements of investees to assess whether the
Company exercised significant influence and whether the application of the equity method was
appropriate;
c. Inquiring about management regarding significant or unusual fluctuations in investment income and
assessing the reasonableness of the explanations provided;
d. Obtaining the financial statements of investees to verify the accuracy of adjustments for unrealized
96 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
profits from related-party transactions the calculation of investment income and the Company’s share
of changes in the investees’ net assets.e. Performing analytical procedures on investees that contributed significantly to the current-period
investment income including the analysis of revenue cost of sales and inventory balances as well as
reviewing supporting schedules and documentation provided by the investees.Based on the procedures performed we did not identify any material misstatements related to the
recognition of income from long-term equity investments.
4. Other Information
The management of Wellhope Foods Co. Ltd. (hereinafter referred to as "the Company") is responsible
for the other information. The other information comprises the information included in the Company’s
2024 Annual Report but does not include the financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express
any form of assurance conclusion thereon.In connection with our audit of the financial statements our responsibility is to read the other
information and in doing so consider whether it is materially inconsistent with the financial
statements or with the knowledge we obtained in the audit or otherwise appears to be materially
misstated.If based on the work we have performed we conclude that there is a material misstatement of the
other information we are required to report that fact. We have no such matters to report.
5. Responsibilities of the Management and Those Charged with Governance for Financial Statements
The management is responsible for the preparation of the financial statements that give a true and fair
view in accordance with the Accounting Standards for Business Enterprises (ASBE) and for designing
implementing and maintaining such internal control as management determines is necessary to enable
the preparation of financial statements that are free from material misstatement whether due to fraud
or error.In preparing the financial statements management is responsible for assessing the Company’s ability to
continue as a going concern disclosing as applicable matters related to going concern and using the
going concern basis of accounting unless management either intends to liquidate the Company or to
cease operations or has no realistic alternative but to do so.Those charged with governance are responsible for overseeing the Company’s financial reporting
process.
6. Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement whether due to fraud or error and to issue an auditor’s report
that includes our opinion. Reasonable assurance is a high level of assurance but it is not a guarantee
that an audit conducted in accordance with auditing standards will always detect a material
97 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
misstatement when it exists.Misstatements can arise from fraud or error and are considered material if individually or in the
aggregate they could reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.As part of an audit in accordance with auditing standards we exercise professional judgment and
maintain professional skepticism throughout the audit. We also:
A. Identify and assess the risks of material misstatement of the financial statements whether due to
fraud or error; design and perform audit procedures responsive to those risks; and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a
material misstatement resulting from fraud is higher than for one resulting from error as fraud may
involve collusion forgery intentional omissions misrepresentations or the override of internal control.B. Obtain an understanding of internal control relevant to the audit to design appropriate audit
procedures but not for the purpose of expressing an opinion on the effectiveness of the Company’s
internal control.C. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.D. Conclude on the appropriateness of management’s use of the going concern basis of accounting and
based on the audit evidence obtained whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If
we conclude that material uncertainty exists we are required to draw attention in our auditor’s report
to the related disclosures in the financial statements or if such disclosures are inadequate to modify
our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However future events or conditions may cause the Company to cease to continue as a going
concern.E. Evaluate the overall presentation structure and content of the financial statements including the
disclosures and whether the financial statements represent the underlying transactions and events in a
manner that achieves fair presentation.F. Obtain sufficient and appropriate audit evidence regarding the financial information of the entities or
business activities within the Company to express an opinion on the financial statements. We are
responsible for the direction supervision and performance of the Company audit and remain solely
responsible for our audit opinion.We communicate with those charged with governance regarding among other matters the planned
scope and timing of the audit and significant audit findings including any significant deficiencies in
internal control that we identify during our audit.We also provide them with a statement confirming our compliance with relevant ethical requirements
regarding independence and communicate all relationships and other matters that may reasonably be
98 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
thought to bear on our independence and where applicable the related safeguards.From the matters communicated with those charged with governance we determine those matters
that were of most significance in the audit of the financial statements for the current period and
therefore are the key audit matters. We describe these matters in our auditor’s report unless law or
regulation precludes public disclosure or in extremely rare circumstances we conclude that a matter
should not be disclosed because the adverse consequences of doing so would reasonably be expected
to outweigh the public interest benefits.RSM CHINA CPA LLP Certified Public Accountant (China): Huang Xiao
(Engagement Partner)
Certified Public Accountant (China): Zhao Songhe
Certified Public Accountant (China): Zhang Yuanyuan
Beijing China April 24 2025
99 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
II.Financial Statements
Consolidated Balance Sheet
Dec. 31 2024
RMB
Item Dec. 31 2024 Dec. 31 2023
Current Assets
Cash at banks 1794235141.02 1915378798.77
Trading financial assets 904884.08 829591.32
Derivative financial assets 2441832.40 4296668.60
Notes receivable 27893377.89 6620586.95
Accounts receivable 893154885.76 1114486394.01
Receivables financing 9139184.14
Prepaid expenses 262395498.70 469857003.51
Other receivables 69263268.24 92732094.80
Inventory 2809039422.59 2686755249.88
Contract assets 628713.20 2432720.15
Other current assets 144952159.05 129436936.38
Total current assets 6014048367.07 6422826044.37
Non-current assets
Long-term equity investment 2484323621.63 2316034522.19
Other equity instrument investment 163722.78 14826710.99
Investment property 23980919.68
Fixed assets 4307643182.96 4168026657.86
Construction in progress 189068183.70 158377935.65
Biological asset 216354910.60 199776536.89
Right-of-use assets 547493899.54 525191183.39
Intangible assets 393245823.31 363530774.64
Goodwill 19864604.90 290425.67
Long-term deferred expenses 65401006.07 65324043.39
Deferred tax assets 68833034.84 102365943.34
Other non-current assets 552101624.23 600544056.16
Total non-current assets 8868474534.24 8514288790.17
Total Assets 14882522901.31 14937114834.54
Current Liabilities
Short-term borrowings 567278990.41 970957309.50
Accounts payable 1629553678.79 1629789558.94
Customer advances 18172031.73
Contract liabilities 281430591.89 252530723.35
Payables to employees 240573782.76 225357401.11
Taxes payable 56466910.36 42449739.70
Other payables 638629689.02 479780643.59
Of which：Interests payable 10369863.01 5184931.51
Dividends payable 16453038.17
Current portion of non-current liabilities 497542789.55 932730557.07
Other current liabilities 8223061.85 6656358.86
Total current liabilities 3919699494.63 4558424323.85
Non-current Liabilities
Long-term loans 1444154268.34 920051517.19
Bonds payable 1349079789.00 1305789795.09
Lease liabilities 420845598.26 368001422.29
100 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Long-term payables 94867723.87 42542892.62
Deferred income 75291554.80 73419574.05
Deferred tax liabilities 1185667.86 53459620.43
Total non-current liabilities 3385424602.13 2763264821.67
Total Liabilities 7305124096.76 7321689145.52
Owners' equity (or shareholders' equity)
Share capital 919434448.00 919433663.00
Other equity instruments 233670941.96 233672216.24
Additional paid-in capital 808038213.37 872912049.17
Less: Treasury shares 425931323.30 200003612.37
Other comprehensive income -39649855.09 -23877064.04
Surplus reserves 474685527.73 457022680.97
Undistributed profit 4724940370.20 4400135075.82
Equity attributable to owners of the parent 6695188322.87 6659295008.79
Non-controlling interests 882210481.68 956130680.23
Total owners' equity 7577398804.55 7615425689.02
Total liabilities and owners' equity 14882522901.31 14937114834.54
101 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Consolidated Balance Sheet of Parent Company
December 31 2024
RMB
Item Dec. 31 2024 Dec. 31 2023
Current assets
Cash at banks 1670844671.81 1691224437.05
Accounts receivable 65913288.04 27663635.24
Prepaid expenses 732811.68 3801364.20
Other receivables 2235085491.40 2344452508.57
Of which: Interest receivable
Dividends receivable 19052119.77 54770301.77
Inventory 66261344.18 49373613.63
Total current assets 4038837607.11 4116515558.69
Non-current assets
Long-term equity investment 6485005782.44 6197179106.62
Other equity instruments investment 717064.49 4824017.06
Fixed assets 118662128.54 130562943.77
Construction in progress 5484692.80 4163600.00
Intangible assets 19967998.28 15428979.00
Long-term deferred expenses 1465672.77 2490858.28
Deferred income tax assets 12569724.20 8832488.62
Other non-current assets 990000.00 7200000.00
Total non-current assets 6644863063.52 6370681993.35
Total assets 10683700670.63 10487197552.04
Current liabilities:
Short-term borrowings 270173790.32 552401555.56
Accounts payable 31540843.42 21019772.54
Customer advances 5188.00
Contract liabilities 2989164.65 4647122.21
Payables to employees 13118898.87 9642962.98
Taxes payable 3620439.89 5125029.13
Other payables 2869019473.66 2392238692.22
Of which: Interest payable 10369863.01 5184931.51
Current portion of non-current liabilities 288300000.00 775600000.00
Total current liabilities 3478767798.81 3760675134.64
Non-current liabilities
Long-term loans 1034598752.69 481999161.11
Bonds payable 1349079789.00 1305789795.09
Deferred income 34577340.00 38958320.00
Deferred tax liabilities 1365.00
Total non-current liabilities 2418255881.69 1826748641.20
Total liabilities 5897023680.50 5587423775.84
Owners' equity (or shareholders' equity)
Share capital 919434448.00 919433663.00
Other equity instruments 233670941.96 233672216.24
Additional paid-in capital 821935606.00 878828709.67
Less: Treasury shares 425931323.30 200003612.37
Other comprehensive income -30252649.01 -23348699.23
Surplus reserves 474685527.73 457022680.97
Undistributed profit 2793134438.75 2634168817.92
102 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Total owners' equity 4786676990.13 4899773776.20
Total liabilities and owners' equity 10683700670.63 10487197552.04
103 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Consolidated Income Statement
January-December 2024
RMB
Item 2024 2023
1. Revenue 32545260037.87 35970261909.41
Of which: Revenue 32545260037.87 35970261909.41
2. Cost of revenue 32083825709.63 36183648470.74
Of which: Cost of revenue 30447129165.17 34540124263.81
Taxes and surcharges 56989743.36 54959832.38
Sales expenses 709944370.21 718365669.03
Administrative expenses 672530023.01 614800562.62
R&D expenses 29041137.57 83797469.99
Financial expenses 168191270.31 171600672.91
Of which: Interest expenses 181050699.18 179236989.51
Interest income 12294655.57 13127370.37
Add: Other income 38455461.52 34513001.48
Income from investment 137700522.64 -148334501.12
Of which: Income from investments in associated
129857217.55-133401069.07
companies and joint ventures
Gain or loss from changes in fair value -147128.24 -490609.02
Credit impairment loss -141911879.37 -38716956.58
Assets impairment loss -53274841.91 -143836924.38
Gain or loss from assets disposal 1358138.02 20674676.33
3. Operating profit 443614600.90 -489577874.62
Add: Non-operating income 26553761.91 74211372.98
Less: Non-operating expenditure 76264332.73 65574928.07
4. Pretax profit 393904030.08 -480941429.71
Less: Income tax expense 83607979.72 107091597.63
5. Net profit 310296050.36 -588033027.34
A. Classified by continuity of operations
a.Net profit from continuing operations 310296050.36 -588033027.34
B. Classified by ownership attribution
a.Net profit attributable to owners of the parent 342468141.14 -457037550.28
b. Profit or loss attributable to minority interests -32172090.78 -130995477.06
6. Other comprehensive income net of tax -14423278.24 -4169370.03
A. Attributable to owners of the parent -15772791.06 -3729321.14
a.Other comprehensive income that will not be
-14642433.23-8486483.42
reclassified to profit or loss
a)Fair value changes in other equity instruments -14642433.23 -8486483.42
104 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
b.Other comprehensive income that will be
-1130357.834757162.28
reclassified to profit or loss
a)Other comprehensive income under the equity
-2832988.685344603.95
method that can be reclassified to profit or loss
b)Foreign exchange differences on translation of
1702630.85-587441.67
foreign financial statements
B. Attributable to minority interests 1349512.82 -440048.89
7. Total comprehensive income 295872772.12 -592202397.37
Attributable to the owners of parent company 326695350.08 -460766871.42
Attributable to non-controlling interests -30822577.96 -131435525.95
8. EPS
(1) Basic earnings per share (yuan per share) 0.38 -0.50
(2) Diluted earnings per share (yuan per share) 0.38 -0.50
105 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Consolidated Income Statement of Parent Company
January-December 2024
RMB
Item 2024 2023
1. Revenue 682050134.44 716127171.26
Less: Cost of revenue 509845631.64 538676281.08
Taxes and surcharges 2101403.14 2005206.45
Sales expenses 16337920.76 13941941.52
Administrative expenses 67520705.89 54956164.98
R&D expenses 22135865.78 23168745.28
Financial expenses 52649924.21 53893983.25
Of which: Interest expenses 115157179.78 117713796.21
Interest income 62747413.27 63964147.19
Add: Other income 8884658.25 5982990.84
Income from Investment 167225085.53 17018412.65
Of which: Income from investments in associated
117945879.18-118923656.51
companies and joint ventures
Gain or loss from changes in fair value 9100.00
Credit impairment loss 56957.96 -11861099.83
Assets impairment loss
Gain or loss from assets disposal -221245.41 87143.54
2. Operating profit 187404139.35 40721395.90
Add: Non-operating income 848736.59 3731810.00
Less: Non-operating expenditure 5211244.12 3471507.36
3. Pretax profit 183041631.82 40981698.54
Less: Income tax expense 6413164.23 10807557.67
4. Net profit 176628467.59 30174140.87
Net profit from continuing operations 176628467.59 30174140.87
5. Other comprehensive income net of tax -6903949.78 -4651391.98
A. Other comprehensive income that will not be
-4096952.57-10025752.09
reclassified to profit or loss
a. Fair value changes in other equity instruments -4096952.57 -10025752.09
B. Other comprehensive income that will be
-2806997.215374360.11
reclassified into gains or losses
a. Other comprehensive income under the equity
-2806997.215374360.11
method that can be reclassified to profit or loss
6. Total comprehensive income 169724517.81 25522748.89
106 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Consolidated Statement of Cash Flow
January-December 2024
RMB
Item 2024 2023
1. Cash flow from operating activities
Cash received by selling products providing labor services 34340820896.67 37256317508.82
Tax refunds 39211390.72 56144648.50
Cash received from other activities related to operating 393298565.50 200210649.34
Sub-total of cash inflow of operating activities 34773330852.89 37512672806.66
Cash paid for purchasing products and receiving labor services 30793203529.15 34376170787.12
Cash paid to and for employees 1669334296.14 1341188891.15
Tax payments 199057582.61 206139366.67
Cash paid to other activities related to operating 934834948.46 633021011.40
Sub-total of cash outflow of operating activities 33596430356.36 36556520056.34
Net cash flow from operating activities 1176900496.53 956152750.32
2. Cash flow from investing activities
Cash received from disinvestment 13000000.00 31320000.00
Cash received from return on investment 16941434.70 75098517.32
Net cash received from the disposal of fixed assets intangible
10336063.5578944914.78
assets and other long-lived assets
Cash received from other activities related to investment 2409207.07 20625440.88
Sub-total of cash inflow of investing activities 42686705.32 205988872.98
Cash paid for acquiring and building fixed assets intangible
393119573.96486888624.03
assets and other long-lived assets
Cash paid for investment 81986951.00 87325879.79
Net cash paid for acquiring subsidiaries and other business
234461.4731609074.72
units
Cash paid for other activities related to investing activities 15623864.47 3029935.48
Sub-total of cash outflow of investing activities 490964850.90 608853514.02
Net cash flow from investing activities -448278145.58 -402864641.04
3. Cash flow from financing activities
Cash received by absorbing investments 110268965.00 80869000.00
Of which: Capital contributed by non-controlling interests to
38170000.0080869000.00
subsidiaries
Cash received from borrowings 1903088118.55 1959093175.98
Cash received from other activities related to financing 17306056.53 17502820.88
Sub-total of cash inflow of financing activities 2030663140.08 2057464996.86
Cash paid for debt service 2318304866.68 1913030822.71
Cash paid for dividends profits or paid for interests 120402126.46 260193609.83
Oh which: Dividends or profits paid by subsidiaries to
23455436.2849681301.69
non-controlling interests
Cash paid to other activities related to financing activities 469309166.46 192436934.03
Sub-total of cash outflow of financing activities 2908016159.60 2365661366.57
Net cash flow from financing activities -877353019.52 -308196369.71
4. Effect of foreign exchange rate fluctuations on cash and
2187985.53962598.25
cash equivalents
5. Net increase in cash and cash equivalents -146542683.04 246054337.82
107 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Add: Opening balance of cash and cash equivalents 1895034560.64 1648980222.82
6. Closing balance of cash and cash equivalents 1748491877.60 1895034560.64
108 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Consolidated Statement of Cash Flow of Parent Company
January-December 2024
RMB
Item 2024 2023
1. Cash flow from operating activities
Cash received by selling products providing labor services 646385106.67 729864336.81
Cash received from other activities related to operating 24648667.48 28731129.25
Sub-total of cash inflow of operating activities 671033774.15 758595466.06
Cash paid for purchasing products and receiving labor services 503976806.39 535935783.53
Cash paid to and for employee 62823017.91 61839292.07
Tax payments 17650510.92 6605925.10
Cash paid to other activities related to operating 46024888.98 29901683.93
Sub-total of cash outflow of operating activities 630475224.20 634282684.63
Net cash flow from operating activities 40558549.95 124312781.43
2. Cash flow from investing activities
Cash received from disinvestment 39518868.83 71426938.53
Cash received from return on investment 82353110.06 131796058.16
Net cash received from disposal of fixed assets intangible
80680.00189609.57
assets and other long-lived assets
Cash received from other activities related to investment 502266851.90 1388081.74
Sub-total of cash inflow of investing activities 624219510.79 204800688.00
Cash paid for acquiring and building fixed assets intangible
3013759.8017731144.01
assets and other long-lived assets
Cash paid for investments 183161464.03 496225561.83
Cash paid for other activities related to investing activities 25235942.34
Sub-total of cash outflow of investing activities 186175223.83 539192648.18
Net cash flow from investing activities 438044286.96 -334391960.18
3. Cash flow from financing activities
Cash received from borrowings 72098965.00
Cash received from issuing bonds 1170000000.00 900000000.00
Cash received from other activities related to financing 1591861.08 686397146.94
Sub-total of cash inflow of financing activities 1243690826.08 1586397146.94
Cash paid for debt service 1386600000.00 1023600000.00
Cash paid for dividends profits or paid for interests 67010349.19 175965032.98
Cash paid to other activities related to financing activities 310000000.00
Sub-total of cash outflow of financing activities 1763610349.19 1199565032.98
Net cash flow from financing activities -519919523.11 386832113.96
4. Effect of foreign exchange rate fluctuations on cash and
160.6511903.33
cash equivalents
5. Net increase in cash and cash equivalents -41316525.55 176764838.54
Add: Opening balance of cash and cash equivalents 1682342826.24 1505577987.70
6. Closing balance of cash and cash equivalents 1641026300.69 1682342826.24
109 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Consolidated Statement of Changes in Equity
January-December 2024
RMB
2024
Equity Attributable to the Owners of Parent Company
Item Other equity Other Non-controlling Total owners'
less: Treasury Undistributed
Share capital instruments Capital reserve comprehensive Surplus reserve Subtotal interests equity
stock profit
Other income
1. Closing
balance of prior 919433663.00 233672216.24 872912049.17 200003612.37 -23877064.04 457022680.97 4400135075.82 6659295008.79 956130680.23 7615425689.02
period
Add: Changes in
accounting
policies
Other
2. Opening
balance of 919433663.00 233672216.24 872912049.17 200003612.37 -23877064.04 457022680.97 4400135075.82 6659295008.79 956130680.23 7615425689.02
current period
3. Fluctuations of
785.00-1274.28-64873835.80225927710.93-15772791.0517662846.76324805294.3835893314.08-73920198.55-38026884.47
current period
A. Total
comprehensive -15772791.05 342468141.14 326695350.09 -30822577.96 295872772.13
income
B. Capital
contributed and
785.00-1274.28-64873835.80225927710.93-290802036.01-21149217.68-311951253.69
reduced by
owners
a. Common stock
invested by -66617313.16 225927710.93 -292545024.09 -12750079.48 -304065885.44
owners
b. Capital
contributed by
the holders of 785.00 -1274.28 7817.67 7328.39 7328.39
other equity
instruments
c. Other 1735659.69 1735659.69 -8399138.20 -7892696.64
C. Profit
17662846.76-17662846.76-21948402.91-21948402.91
distribution
a. Withdrawal of
17662846.76-17662846.76
surplus reserves
b. Extraction of
general risk
110 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
provisions
c. Dividend to
owners (or -21948402.91 -21948402.91
shareholders)
d. Other
D. Internal
carry-over of
owners’ equity
a. Carry-over of
other
comprehensive
income to
undistributed
profit
4. Closing
balance of 919434448.00 233670941.96 808038213.37 425931323.30 -39649855.09 474685527.73 4724940370.20 6695188322.87 882210481.68 7577398804.55
current period
2023
Equity Attributable to the Owners of Parent Company
Item Other equity Other Non-controlling Total owners'
less: Treasury Undistributed
Share capital instruments Capital reserve comprehensive Surplus reserve Subtotal interests equity
stock profit
Other income
1. Closing
balance of prior 919430450.00 233677472.64 880746284.55 200003612.37 -20147742.90 454175320.97 4967837188.90 7235715361.79 1119910247.51 8355625609.30
period
Add: Changes in
accounting
policies
Other
2. Opening
balance of 919430450.00 233677472.64 880746284.55 200003612.37 -20147742.90 454175320.97 4967837188.90 7235715361.79 1119910247.51 8355625609.30
current period
3. Fluctuations
of current 3213.00 -5256.40 -7834235.38 -3729321.14 2847360.00 -567702113.08 -576420353.00 -163779567.28 -740199920.28
period
A. Total
comprehensive -3729321.14 -457037550.28 -460766871.42 -131435525.95 -592202397.37
income
B. Capital
contributed and
3213.00-5256.40-7834235.38-7836278.7818847225.7811010947.00
reduced by
owners
111 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
a. Common
stock invested -11391428.92 -11391428.92 22029990.09 10638561.17
by owners
b. Capital
contributed by
the holders of 3213.00 -5256.40 38669.80 36626.40 36626.40
other equity
instruments
c. Amount of
share-based
payment
included in the
owner's equity
d. Other 3518523.74 3518523.74 -3182764.31 335759.43
C. Profit
2847360.00-110664562.80-107817202.80-51191267.11-159008469.91
distribution
a. Withdrawal of
3017414.09-3017414.09
surplus reserves
b. Extraction of
general risk
provisions
c. Dividend to
owners (or -107817202.80 -107817202.80 -51191267.11 -159008469.91
shareholders)
d. Other -170054.09 170054.09
D. Internal
carry-over of
owners’ equity
a. Carry-over of
other
comprehensive
income to
undistributed
profit
4. Closing
balance of 919433663.00 233672216.24 872912049.17 200003612.37 -23877064.04 457022680.97 4400135075.82 6659295008.79 956130680.23 7615425689.02
current period
112 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Statement of Changes in Equity of Parent Company
January-December 2024
RMB
2024
Other equity Other
Item
instruments less: Treasury Undistributed Total owners' Share capital Capital reserve comprehensive Surplus reserve
stock profit equity
Other income
1. Closing balance of prior
919433663.00233672216.24878828709.67200003612.37-23348699.23457022680.972634168817.924899773776.20
period
Add: Changes in
accounting policies
Other
2. Opening balance of
919433663.00233672216.24878828709.67200003612.37-23348699.23457022680.972634168817.924899773776.20
current period
3. Fluctuations of current
785.00-1274.28-56893103.67225927710.93-6903949.7817662846.76158965620.83-113096786.07
period
A. Total comprehensive
-6903949.78176628467.59169724517.81
income
B. Capital contributed and
785.00-1274.28-56893103.67225927710.93-282821303.88
reduced by owners
a. Common stock invested
-61496032.42225927710.93-287423743.35
by owners
b. Capital contributed by
the holders of other equity 785.00 -1274.28 7817.67 7328.39
instruments
c. Amount of share-based
payment that included in 1970111.08 1970111.08
the owner's equity
d. Other 2625000.00 2625000.00
C. Profit distribution 17662846.76 -17662846.76
a. Withdrawal of surplus
17662846.76-17662846.76
reserves
b. Dividend to owners (or
shareholders)
c. Other
4. Closing balance of 919434448.00 233670941.96 821935606.00 425931323.30 -30252649.01 474685527.73 2793134438.75 4786676990.13
113 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
current period
2023
Other equity
Item less: Treasury Other comprehensive Surplus Undistributed Total owners'
Share capital instruments Capital reserve
stock income reserve profit equity
Other
1. Closing balance of
919430450.00233677472.64878256358.18200003612.37-18697307.25454175320.972716359780.794983198462.96
prior period
Add: Changes in
accounting policies
Other
2. Opening balance of
919430450.00233677472.64878256358.18200003612.37-18697307.25454175320.972716359780.794983198462.96
current period
3. Fluctuations of current
3213.00-5256.40572351.49-4651391.982847360.00-82190962.87-83424686.76
period
A. Total comprehensive
-4651391.9830174140.8725522748.89
income
B. Capital contributed
3213.00-5256.40572351.49570308.09
and reduced by owners
a. Common stock
invested by owners
b. Capital contributed by
the holders of other 3213.00 -5256.40 38669.80 36626.40
equity instruments
c. Amount of share-based
payment that included in
the owner's equity
d. Other 533681.69 533681.69
C. Profit distribution 2847360.00 -112365103.74 -109517743.74
a. Withdrawal of surplus
3017414.09-3017414.09
reserves
b. Dividend to owners (or
-107817202.80-107817202.80
shareholders)
c. Other -170054.09 -1530486.85 -1700540.94
4. Closing balance of
919433663.00233672216.24878828709.67200003612.37-23348699.23457022680.972634168817.924899773776.20
current period
114 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
III. Basic Information of the Company
1. Overview of the Company
Wellhope Foods Co. Ltd. (formerly known as Liaoning Wellhope Agri-Tech Co. Ltd. hereinafter
referred to as the "Company" or "the Company") is a joint-stock company established by 23 natural
persons including Jin Weidong and Ding Yunfeng with the approval of the People's Government of
Liaoning Province. The Company was registered and established on March 27 2003 with a registered
capital of RMB 53.00 million. Among them: Jin Weidong contributed RMB 12.19 million accounting for
23.00% of the share capital; Ding Yunfeng contributed RMB 7.685 million accounting for 14.50% of the
share capital; Wang Fengjiu Zhang Tiesheng Shao Caimei and Wang Zhongtao each contributed RMB
4.505 million each accounting for 8.50% of the share capital; the other 17 shareholders contributed
RMB 15.105 million in total accounting for 28.50% of the share capital.With the approval of the Ministry of Commerce of the People's Republic of China the Company issued
5.888889 million shares to De Heus (China) through private placement on August 22 2006. The
Company was converted into a foreign-invested joint-stock company and the total share capital was
changed to 58.888889 million shares. With the approval of the Liaoning Foreign Trade and Economic
Cooperation Department the Company issued 3.464052 million shares to De Heus (China) through
private placement on November 15 2007. After the capital increase the total share capital of the
Company was increased to 62.352941 million shares.In 2010 the Second Extraordinary General Meeting of the Company approved the conversion of
undistributed profits into share capital by issuing 50 bonus shares for every 10 shares based on the
total share capital as of December 31 2009. After the conversion the total share capital of the
Company was increased to 374.117646 million shares. In addition the Third Extraordinary General
Meeting of the Company in 2010 approved the conversion of capital reserves into 100 million shares
and the total share capital of the Company increased to 474.117646 million shares.With the approval of the China Securities Regulatory Commission the Company issued 80 million new
shares at a price of RMB 5.88 per share on August 4 2014. After the initial public offering (IPO) the
total share capital of the Company was increased to 554.1176 million shares.The Second Extraordinary General Meeting of the Company in 2015 approved the conversion of capital
reserves into share capital by issuing 5 bonus shares for every 10 shares based on the total share
capital as of June 30 2015. After the conversion the total share capital of the Company was increased
to 831.1765 million shares.The Second Extraordinary General Meeting of the Company in 2018 resolved to issue 14.575 million
restricted shares to 372 natural persons at RMB 4.85 per share on December 29 2018. After the
change the total share capital of the Company was increased to 845.7515 million shares.With the approval of the China Securities Regulatory Commission the Company privately issued
76.5529 million domestic listed RMB ordinary shares on April 18 2019. After the change the total
115 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
share capital was 922.3044 million shares.On March 27 2020 the Company repurchased and cancelled 244500 restricted shares that had been
granted but not yet released from restriction. After the change the total share capital was 922.0599
million shares.On March 24 2021 the Company's name was changed to Wellhope Foods Co. Ltd.On May 19 2021 the Company repurchased and wrote off 99700 restricted shares that had been
granted but not yet released from restriction. After the change the total share capital was 921.9602
million shares.On June 22 2022 the Company repurchased and cancelled 5.742 million restricted shares that had
been granted but not yet released from restriction. After the change the total share capital was
916.2182 million shares.
On April 22 2022 with the approval of the China Securities Regulatory Commission's "Decision on
Approving Wellhope Foods Co. Ltd to Issue Convertible Corporate Bonds" the Company publicly
issued RMB 1.5 billion worth of convertible corporate bonds (referred to as "Wellhope Convertible
Bonds") with a term of 6 years starting to be convertible from October 28 2022.As of December 31 2024 due to the conversion of convertible bonds the Company increased its
shares by 3.2163 million and the total share capital changed to 919.4344 million shares.Principal activities of the Company and its subsidiaries: production and sale of feed and feed additives
trade in feed raw materials poultry farming slaughtering and processing livestock farming frozen
food processing packaging refrigeration sales processing of agricultural and local specialty products
etc.Registered address (head office address): No. 169 Huishan Street Shenbei New District Shenyang
Liaoning Province.Legal representative: Jin Weidong
The financial statements have been approved by the meeting of Board of Directors held on April 24
2025.
IV. Basis of Preparing Financial Statements
1. Basis of preparing
The Company prepares its financial statements on a going concern basis recognizing and measuring
transactions and events based on their actual occurrence in accordance with the Accounting Standards
for Business Enterprises their application guidelines and related interpretations. In addition the
Company discloses financial information in compliance with the Compilation Rule for Information
Disclosure by Companies Offering Securities to the Public No.15 - General Provisions on Financial
Reports (2023 revised) issued by the China Securities Regulatory Commission.
2. Going concern
The Company has evaluated the ability to continue as a going concern for 12 months from the end of
116 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
the Reporting Period and has not identified any factors that would impact its ability to continue as a
going concern. It is reasonable for the Company to prepare its financial statements on a going concern
basis.V. Important Accounting Policies and Accounting Estimates
Reminders on specific accounting policies and accounting estimates:
The following significant accounting policies and accounting estimates of the Company are formulated
in accordance with the Accounting Standards for Business Enterprises. For matters not mentioned the
relevant accounting policies in the Accounting Standards for Business Enterprises will be applied.
1.Declaration about compliance with Accounting Standards for Business Enterprises
The financial statements are in compliance with the requirements of accounting standards for business
enterprises and truly and completely reflect the financial status operating results changes in owners’
equity cash flow and other relevant information of the Company.
2.Accounting period
The accounting year of the Company is from January 1 to December 31 in the calendar year.
3.Operating cycle
The normal operating cycle of the Company is twelve months.
4.Bookkeeping base currency
RMB.
5.Method for determining materiality criteria and basis for selection
Item Criteria for materiality
Significant receivables with a single provision for bad debts RMB 1 million
Significant receivables written off RMB 1 million
Significant construction in progress RMB 10 million
Significant dividends receivable RMB 10 million
6.Accounting treatment of business combinations under and not under common control
(1) Business combination under common control
The assets and liabilities acquired by the Company in a business combination are measured at the
carrying amount in the consolidated financial statements of the ultimate controlling party on the
acquisition date. In cases where the acquired company uses different accounting policies or periods
compared to the Company before the business combination the accounting policies and periods are
aligned based on the principle of materiality. Specifically the carrying amounts of the acquired assets
and liabilities are adjusted according to the Company’s accounting policies and periods. If there is a
difference between the carrying amount of the net assets acquired in the business combination and the
consideration paid the capital reserve (capital premium or capital stock premium) is adjusted first. If
the balance of the capital reserve (capital premium or capital stock premium) is insufficient it is then
sequentially adjusted against the surplus reserve and undistributed profit.For the accounting treatment of business combinations under common control achieved through step
117 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
transactions refer to Note V-7 (5).
(2) Business combination not under the common control
The identifiable assets and liabilities of the acquired party in a business combination are measured at
their fair value on the acquisition date. In cases where the acquired party uses different accounting
policies or periods compared to the Company before the business combination the accounting policies
and periods are aligned based on the principle of materiality. Specifically the carrying amounts of the
acquired assets and liabilities are adjusted according to the Company’s accounting policies and periods.If the Company’s acquisition cost on the acquisition date exceeds the fair value of the identifiable assets
and liabilities acquired in the business combination the difference is recognized as goodwill. If the
acquisition cost is less than the fair value of the identifiable assets and liabilities acquired the
acquisition cost and the fair value of the acquired identifiable assets and liabilities are reviewed. After
review if the acquisition cost is still less than the fair value of the identifiable assets and liabilities
acquired the difference is recognized in the current period’s consolidated profit or loss.For the accounting treatment of business combinations under different control achieved through step
transactions refer to Note V-7 (5).
(3) Treatment of transaction costs in a business combination
The audit legal services valuation consulting and other intermediary fees as well as other related
administrative expenses incurred for the purpose of a business combination are recognized as
expenses in the current period when incurred. Transaction costs related to equity securities or debt
securities issued as part of the merger consideration are included in the initial recognition amount of
the equity securities or debt securities.
7.Judgment of control and method of preparing the consolidated financial statements
(1) Judgment of control and determination of consolidation scope
Control refers to the Company’s power over the investee the variable returns it can obtain through
participation in the investee’s relevant activities and the ability to use its power over the investee to
affect the amount of returns. The definition of control includes three key elements: 1) The investor has
power over the investee. 2) The investor has rights to enjoy variable returns from its involvement with
the investee. 3) The investor has the ability to use its power over the investee to affect the amount of
returns. When the Company’s investment in the investee meets these three elements it indicates that
the Company has control over the investee.The scope of consolidation in the consolidated financial statements is determined based on control
and includes not only subsidiaries determined by voting rights (or similar rights) alone or in
combination with other arrangements but also structured entities determined by one or more
contractual arrangements.A subsidiary refers to an entity controlled by the Company (including businesses separable parts of an
investee and structured entities controlled by the Company). A structured entity refers to an entity
118 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
designed in such a way that voting rights or similar rights are not the deciding factor in determining its
controlling party (Note: sometimes also called a Special Purpose Entity or SPE).
(2) Method of preparing the consolidated financial statements
The Company prepares consolidated financial statements based on the financial statements of itself
and its subsidiaries and other relevant information.While preparing consolidated financial statements the Company treats the entire enterprise group as
an accounting entity and in accordance with the requirements for confirmation measurement and
presentation of relevant enterprise accounting standards and based on unified accounting policies and
periods reflects the overall financial position operating results and cash flow of the enterprise group.* Consolidate the assets liabilities owners’ equity revenue expenses and cash flows of the parent
company and its subsidiaries.* Offset the long-term equity investments of the parent company in its subsidiaries against the
portion of owners’ equity held by the parent company in the subsidiaries.* Offset the effects of internal transactions between the parent company and its subsidiaries as well
as between subsidiaries. If internal transactions indicate impairment losses of related assets the full
amount of the loss shall be recognized.* Adjust special transactions from the perspective of the enterprise group.
(3) Treatment of changes in subsidiaries during the Reporting Period
* Increase in subsidiary or business
A. Subsidiaries or businesses acquired in a business combination under common control
(a) When preparing the consolidated balance sheet adjust the opening balances of the consolidated
balance sheet and also adjust the relevant items of the comparative financial statements. It is treated
as if the combined reporting entity has existed since the point when the ultimate controlling party
started controlling.(b) When preparing the consolidated income statement include the revenue expenses and profits of
the acquired subsidiary or business from the beginning of the period to the end of the Reporting Period
in the consolidated income statement. Also adjust the relevant items of the comparative financial
statements treating the combined reporting entity as if it has existed since the point when the ultimate
controlling party started controlling.(c) When preparing the consolidated cash flow statement include the cash flows of the acquired
subsidiary or business from the beginning of the period to the end of the Reporting Period in the
consolidated cash flow statement. Also adjust the relevant items of the comparative financial
statements treating the combined reporting entity as if it has existed since the point when the ultimate
controlling party started controlling.B. Subsidiaries or businesses acquired in a business combination not under common control
(a) When preparing the consolidated balance sheet do not adjust the opening balances of the
119 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
consolidated balance sheet.(b) When preparing the consolidated income statement include the revenue expenses and profits of
the acquired subsidiary or business from the acquisition date to the end of the Reporting Period in the
consolidated income statement.(c) When preparing the consolidated cash flow statement include the cash flows of the acquired
subsidiary or business from the acquisition date to the end of the Reporting Period in the consolidated
cash flow statement.* Disposal of subsidiary or business
A. When preparing the consolidated balance sheet do not adjust the opening balances of the
consolidated balance sheet.B. When preparing the consolidated income statement include the revenue expenses and profits of
the disposed subsidiary or business from the beginning of the period to the disposal date in the
consolidated income statement.C. When preparing the consolidated cash flow statement include the cash flows of the disposed
subsidiary or business from the beginning of the period to the disposal date in the consolidated cash
flow statement.
(4) Special considerations in consolidation eliminations
* The long-term equity investments held by subsidiaries in the parent company shall be treated as
treasury stock and deducted from equity. In the consolidated balance sheet they shall be presented
under the “Equity” item as “Less: treasury stock.”
Long-term equity investments held between subsidiaries shall be offset with the corresponding portion
of equity held in the subsidiary following the same elimination method as for the parent company’s
equity investments in its subsidiaries.* The “special reserve” and “general risk provision” items since they do not belong to paid-in capital
(or share capital) or capital reserves and differs from undistributed profit or undistributed profits shall
be restored to the portion attributable to the parent company’s shareholders after offsetting long-term
equity investments with the owners’ equity in subsidiaries.* If offsetting unrealized internal sales profits or losses results in temporary differences between the
book value of assets and liabilities in the consolidated balance sheet and their tax bases deferred
income tax assets or liabilities shall be recognized in the consolidated balance sheet. Additionally
income tax expense shall be adjusted in the consolidated income statement excluding deferred taxes
related to transactions directly recorded in equity or related to business combinations.* Unrealized internal transaction profits or losses from the sale of assets by the parent to subsidiaries
shall be fully offset against “Net profit attributable to shareholders of the parent company” in the
consolidated income statement. Unrealized internal transaction profits or losses from the sale of assetsby subsidiaries to the parent shall be allocated and offset between “Net profit attributable to
120 / 263Wellhope Foods Co. Ltd. 2024 Annual Reportshareholders of the parent company” and “Profit or loss of minority interest” according to the parent
company’s shareholding in the subsidiary. Unrealized internal transaction profits or losses from the saleof assets between subsidiaries shall be allocated and offset between “Net profit attributable toshareholders of the parent company” and “Profit or loss of minority interest” based on the parent
company’s shareholding in the selling subsidiary.* If losses attributable to minority shareholders for the current period exceed their share of equity in
the subsidiary at the beginning of the period the excess should still be deducted from minority
shareholders’ equity.
(5) Accounting for special transactions
* Purchase of minority shareholder equity
When the Company purchases the minority shareholder equity in its subsidiary the investment cost of
the new long-term equity investment acquired from the purchase of minority equity shall be measured
at the fair value of the consideration paid in the individual financial statements. In the consolidated
financial statements the difference between the new long-term equity investment acquired through
the purchase of minority equity and the share of the subsidiary’s net assets (continuously calculated
from the purchase date or consolidation date) corresponding to the new shareholding ratio shall be
adjusted to capital reserves (capital premium or capital stock premium). If capital reserves are
insufficient it shall be adjusted sequentially to surplus reserves and undistributed profit.* Step-by-step acquisition of control over a subsidiary
A. Business combination under common control through multiple transactions
On the consolidation date in the individual financial statements the initial investment cost of the
long-term equity investment shall be determined based on the share of the subsidiary’s net assets in
the final controlling entity’s consolidated financial statements. The difference between the initial
investment cost and the sum of the book value of the equity investment prior to the consolidation and
the newly paid consideration on the consolidation date shall be adjusted to capital reserves (capital
premium or capital stock premium). If capital reserves are insufficient it shall be adjusted sequentially
to surplus reserves and undistributed profit.In the consolidated financial statements the assets and liabilities of the acquired entity shall be
measured at the book value on the consolidation date except for adjustments made due to differences
in accounting policies and periods. The difference between the sum of the book value of the
pre-acquisition investment and the book value of the new consideration paid on the consolidation date
and the book value of the net assets acquired shall be adjusted to capital reserves (capital stock
premium /capital premium). If capital reserves are insufficient it shall be adjusted to undistributed
profit.For equity investments held by the parent company before the acquisition of control all relevant profits
and losses other comprehensive income and other changes in equity that have been recognized from
121 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
the date the parent and the subsidiary were under common control until the consolidation date shall
be adjusted in the opening undistributed profit for the comparative period or profits and losses for the
current period.B. Business combination not under common control through multiple transactions
On the consolidation date in the individual financial statements the initial investment cost of the
long-term equity investment shall be the sum of the book value of the pre-existing equity investment
and the new investment cost on the consolidation date.In the consolidated financial statements for the equity held in the acquiree before the purchase date it
shall be remeasured at the fair value on the purchase date. If the equity held before the purchase date
is designated as a financial asset measured at fair value with changes recorded in other comprehensive
income the difference between the fair value and its book value shall be recorded in undistributed
profit and the cumulative fair value changes previously recognized in other comprehensive income
shall be transferred to undistributed profit. If the equity held before the purchase date is classified as a
financial asset measured at fair value through profit or loss or as a long-term equity investment
accounted for using the equity method the difference between the fair value and its book value shall
be recorded as investment income for the current period. If the equity held before the purchase date
involves other comprehensive income under the equity method as well as other changes in owners’
equity under the equity method excluding net profit or loss other comprehensive income and profit
distribution the related other comprehensive income shall be accounted for in the same manner as the
direct disposal of related assets or liabilities by the investee and the related other owners’ equity
changes shall be transferred to investment income for the current period on the purchase date.* Disposal of long-term equity investment in a subsidiary without losing control
When the parent company disposes of part of its equity investment in a subsidiary without losing
control in the consolidated financial statements the difference between the disposal consideration
and the subsidiary’s net asset portion from the purchase date or consolidation date shall be adjusted
to capital reserves (capital premium or capital stock premium). If capital reserves are insufficient it
shall be adjusted sequentially to undistributed profit.* Disposal of long-term equity investment in a subsidiary and loss of control
A. Disposal in a single transaction
If the parent company disposes of part of its equity investment and loses control over the investee in
the preparation of consolidated financial statements the remaining equity shall be remeasured at its
fair value on the date of loss of control. The difference between the disposal consideration and the fair
value of the remaining equity minus the net asset portion and goodwill from the original subsidiary
shall be recognized as investment income in the period of losing control.Other comprehensive income related to the original subsidiary’s equity investment shall be accounted
for based on the same treatment as if the related assets or liabilities of the original subsidiary were
122 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
directly disposed of. Other changes in equity under the equity method related to the original subsidiary
shall be transferred to current profit and loss upon losing control.B. Step-by-step disposal in multiple transactions
In the consolidated financial statements it should first be determined whether the step-by-step
transaction constitutes a package transaction.If it is not considered a package transaction in the individual financial statements for each transaction
before losing control of the subsidiary the carrying amount of the long-term equity investment
corresponding to the disposed equity is derecognized and the difference between the consideration
received and the carrying amount of the disposed long-term equity investment is recognized in current
period investment income; In the consolidated financial statements it shall be handled according to the
relevant rules for the disposal of long-term equity investment in a subsidiary without losing control.If the step-by-step transaction is a package transaction all transactions shall be treated as one
transaction involving the disposal of a subsidiary and the loss of control. In the individual financial
statements the difference between the disposal price of each transaction before losing control and the
carrying amount of the long-term equity investment corresponding to the disposed equity is first
recognized in other comprehensive income which will be transferred to profit and loss when control is
lost. In the consolidated financial statements for each transaction before losing control the difference
between the disposal price and the portion of the subsidiary’s net assets shall be recognized as other
comprehensive income which will be transferred to profit and loss when control is lost.Multiple transactions are generally treated as a package transaction if any of the following terms
conditions and economic impacts are met:
(a) The transactions are entered into simultaneously or with consideration of each other’s impact.(b) The transactions as a whole are aimed at achieving a complete business result.(c) The occurrence of one transaction depends on the occurrence of at least one other transaction.(d) A single transaction would not be economically feasible but it becomes economically viable when
considered together with other transactions.* Dilution of the parent company’s ownership in subsidiary due to capital increase by minority
shareholders
When other shareholders (minority shareholders) of the subsidiaries increase capital in the subsidiary
thereby diluting the parent company’s equity interest in the subsidiary in the consolidated financial
statements the difference between this share (the share of the subsidiary’s book net assets before the
capital increase calculated based on the parent company’s pre-increase shareholding ratio) and the
share of the subsidiary’s book net assets after the capital increase (calculated based on the parent
company’s post-increase shareholding ratio) is adjusted to capital reserves (capital premium or capital
stock premium). If capital reserves are insufficient it shall be adjusted to undistributed profit.
123 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
8.Classification of Joint Arrangements and Accounting for Joint Operation
A joint arrangement refers to an arrangement that is jointly controlled by two or more participants. The
Company classifies its joint arrangements as either joint operations or joint ventures.
(1) Joint operations
A joint operation refers to a joint arrangement in which the Company enjoys the related assets and
assumes the related liabilities of the arrangement.The Company recognizes the following items related to the share of interests in joint operations and
makes accounting treatment according to the relevant ASBE:
* Recognizes the assets held separately and the assets held jointly according to its proportion;
* Recognizes the liabilities assumed separately and the liabilities assumed jointly according to its
proportion;
* Recognizes the income from the sales of its share in the outputs of joint operation;
* Recognizes the income from the sales of the outputs of joint operation according to its proportion;
* Recognizes the expenses incurred separately and recognizes the expenses incurred jointly
according to its proportion.
(2) Joint ventures
A joint venture refers to a joint arrangement in which the Company only has rights to the net assets of
the arrangement.The Company accounts for its investment in the joint venture in accordance with the equity method of
accounting for long-term equity investments.
9.Recognition standard of cash and cash equivalents
Cash refers to the Company’s on-hand cash and deposits that can be used for payment at any time.Cash equivalents refer to investments that are of short duration (generally those due within three
months from the date of purchase) highly liquid easily convertible into known amounts of cash and
with minimal risk of value fluctuation.
10.Foreign currency transactions and foreign currency statement translation
(1) Method for determining the exchange rate for foreign currency transactions
The Company uses the spot exchange rate on the transaction date or an exchange rate approximating
the spot rate on the transaction date determined by a reasonable method in the system to convert
foreign currency transactions into the functional currency at initial recognition.
(2) Translation method for foreign currency monetary items at the balance sheet date
At the balance sheet date foreign currency monetary items are translated using the spot exchange rate
at the balance sheet date. Exchange differences arising from the difference between the spot exchange
rate at the balance sheet date and the spot exchange rate at the time of initial recognition or the
previous balance sheet date are recognized in the current profit or loss. For foreign currency
non-monetary items measured at historical cost the spot exchange rate at the transaction date is still
124 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
used for translation. For inventories measured at the lower of cost or net realizable value if the
inventory is purchased in foreign currency and the net realizable value of the inventory at the balance
sheet date is reflected in foreign currency the net realizable value is first translated into the functional
currency at the spot exchange rate at the balance sheet date and then compared with the cost of the
inventory reflected in the functional currency to determine the ending value of the inventory. For
foreign currency non-monetary items measured at fair value the spot exchange rate at the fair value
determination date is used for translation. For financial assets measured at fair value through profit or
loss the difference between the translated functional currency amount and the original functional
currency amount is recognized in the current profit or loss. For non-trading equity investments
designated as measured at fair value through other comprehensive income the difference between the
translated functional currency amount and the original functional currency amount is recognized in
other comprehensive income.
(3) Translation method for foreign currency financial statements
Before translating the financial statements of overseas operations adjustments should first be made to
align the accounting periods and accounting policies of the overseas operations with those of the
enterprise. After making these adjustments to the accounting policies and periods the financial
statements in corresponding currencies (other than the functional currency) shall be prepared
according to the adjusted accounting policies and periods. Then the financial statements of the
overseas operations shall be translated according to the following methods:
* The assets and liabilities items in the balance sheet shall be treated at the spot exchange rate on
the balance sheet date. Except for the “undistributed profit” items other owners’ equity items shall be
translated at the spot exchange rate at the time of occurrence.* The income and expense items in the income statement shall be translated using the spot exchange
rate at the transaction date or an exchange rate close to the spot rate at the transaction date.* For foreign currency cash flows and the cash flows of foreign subsidiaries the spot exchange rate at
the cash flow transaction date or an exchange rate close to the spot rate shall be used for translation.The impact of exchange rate fluctuations on cash shall be treated as an adjustment item and reported
separately in the cash flow statement.* The foreign currency translation differences arising from the financial statement translation shall be
presented under the “Other comprehensive income” item in the owners’ equity section of the
consolidated balance sheet when preparing the consolidated financial statements.When disposing of an overseas operation and losing control the foreign currency translation
differences related to the overseas operation listed under the owners’ equity section of the balance
sheet shall be fully or proportionally transferred to the profit or loss for the period of disposal.
11.Financial instruments
Financial Instruments refer to contracts that create financial assets for one party and financial liabilities
125 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
or equity instruments for another party.
(1) Recognition and derecognition of financial instruments
When the Company becomes a party to a financial instrument contract it recognizes the relevant
financial asset or financial liability.A financial asset should be derecognized when it satisfies one of the following conditions:
* The contractual right to receive cash flows from the financial asset expires;
* The financial asset has been transferred and the transfer meets the derecognition conditions for
financial asset transfer.A financial liability (or part of it) is derecognized when its current obligation has been discharged. If the
Company (borrower) enters into an agreement with the lender to replace an original financial liability
with a new financial liability and the contract terms of the new liability are significantly different from
those of the original liability the original liability is derecognized and a new financial liability is
recognized simultaneously. If the Company makes a substantial modification to the contract terms of
the original financial liability (or part of it) the original financial liability should be derecognized and a
new financial liability should be recognized based on the modified terms.Regular buying and selling of financial assets are recognized and derecognized on the transaction date.Regular buying and selling of financial assets refer to the delivery of financial assets as per the terms of
the contract and at the time determined by regulations or market practices. A transaction date refers
to the date on which the Company commits to buying or selling financial assets.
(2) Classification and measurement of financial assets
Upon initial recognition the Company classifies financial assets based on the business model for
managing the assets and the contractual cash flow characteristics of the financial asset into: financial
assets measured at amortized cost; financial assets measured at fair value with changes recognized in
profit or loss; financial assets measured at fair value with changes recognized in other comprehensive
income. The financial assets shall not be reclassified after initial recognition unless the Company
changes its business model for managing financial assets. In this case all affected relevant financial
assets will be reclassified on the first day of the first Reporting Period following the change in the
business model.Financial assets are initially measured at fair value. For financial assets measured at fair value with
changes recognized in profit or loss the related transaction costs are directly included in the current
profit or loss. For other categories of financial assets transaction costs are included in the initial
recognition amount. Accounts receivable and notes receivable arising from the sale of goods or services
where significant financing components are not included or considered are initially measured by the
Company according to the transaction price defined in the revenue standards.Subsequent measurement of financial assets depends on their classification:
* Financial assets measured at amortized cost
126 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
A financial asset that meets the following conditions shall be classified as a financial asset measured at
amortized cost: The Company’s business model for managing the financial asset is to collect contractual
cash flows; the contractual terms of the financial asset specify that the cash flows generated at specific
dates are solely payments of principal and interest on the outstanding principal amount. For such
financial assets the effective interest method is used for subsequent measurement at amortized cost.The gains or losses arising from derecognition amortization using the effective interest method or
impairment are recognized in the current profit or loss.* Financial assets measured at fair value with changes recognized in other comprehensive income
A financial asset that meets the following conditions shall be classified as a financial asset measured at
fair value with changes recognized in other comprehensive income: The Company’s business model for
managing the financial asset is both to collect contractual cash flows and to sell the financial asset; the
contractual terms of the financial asset specify that the cash flows generated at specific dates are solely
payments of principal and interest on the outstanding principal amount. For such financial assets
subsequent measurement is at fair value. Except for impairment losses or gains and foreign exchange
gains or losses which are recognized in the current profit or loss changes in the fair value of these
financial assets are recognized in other comprehensive income until derecognition. At that point the
accumulated gains or losses are transferred to current profit or loss. However interest income for such
financial assets calculated using the effective interest method is recognized in the current profit or
loss.The Company irrevocably elects to designate certain non-trading equity investments as financial assets
measured at fair value with changes recognized in other comprehensive income. Only the related
dividend income is recognized in the current profit or loss and changes in the fair value are recognized
in other comprehensive income. Upon derecognition of the financial asset the accumulated gains or
losses are transferred to undistributed profit.* Financial assets measured at fair value with changes recognized in current profit or loss
Financial assets other than those classified as financial assets measured at amortized cost or financial
assets measured at fair value with changes recognized in other comprehensive income shall be
classified as financial assets measured at fair value with changes recognized in profit or loss. For such
financial assets subsequent measurement is at fair value and all changes in fair value are recognized in
the current profit or loss.
(3) Classification and measurement of financial liabilities
The Company classifies financial liabilities into financial liabilities measured at fair value with changes
recognized in current profit or loss loan commitments at below-market interest rates financial
guarantee contract liabilities and financial liabilities measured at amortized cost.The subsequent measurement of financial liabilities depends on their classification:
* Financial liabilities measured at fair value with changes recognized in current profit or loss
127 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
This type of financial liability includes trading financial liabilities (including derivative instruments that
are financial liabilities) and financial liabilities designated at fair value through profit or loss. After initial
recognition these financial liabilities are subsequently measured at fair value with gains or losses
(including interest expenses) arising from changes in fair value recognized in current profit or loss
except for those related to hedge accounting. However for financial liabilities designated at fair value
through profit or loss changes in fair value arising from changes in the Company’s own credit risk are
recognized in other comprehensive income. When financial liability is derecognized the cumulative
gains and losses previously recognized in other comprehensive income should be reclassified from
other comprehensive income to undistributed profit.* Loan commitments and financial guarantee contract liabilities
A loan commitment is a promise made by the Company to provide a loan to a customer under
predetermined contractual terms within the commitment period. Loan commitments are subject to
impairment losses under the expected credit loss model.A financial guarantee contract refers to a contract where in the event that a specific debtor fails to
repay the debt according to the original or modified terms of the debt instrument the company is
required to compensate the contract holder for a specific amount of loss. The financial guarantee
contract liability is subsequently measured at the higher of the loss allowance determined based on the
impairment principles for financial instruments and the balance after deducting the cumulative
amortization recognized under the revenue recognition principles from the initial recognition amount.* Financial liabilities measured at amortized cost
After initial recognition other financial liabilities are subsequently measured at amortized cost using
the effective interest rate method.Except in special circumstances financial liabilities and equity instruments are distinguished according
to the following principles:
* If the Company cannot unconditionally avoid fulfilling a contract obligation by delivering cash or
other financial assets the contract obligation meets the definition of a financial liability. Some financial
instruments although they do not explicitly contain terms and conditions requiring the delivery of cash
or other financial assets may still indirectly create a contractual obligation through other terms and
conditions.* If a financial instrument is settled or may be settled using the Company’s own equity instruments
it is necessary to consider whether the Company’s own equity instruments used for settlement are a
substitute for cash or other financial assets or whether they represent the remaining equity in the
assets of the issuer after deducting all liabilities. If the former the instrument is a financial liability of
the issuer; if the latter the instrument is an equity instrument of the issuer. In some cases a financial
instrument contract may require or allow settlement using the Company’s own equity instruments
where the amount of contractual rights or obligations is equal to the number of equity instruments that
128 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
can be obtained or delivered multiplied by their fair value at settlement. In this case regardless of
whether the amount of the contractual rights or obligations is fixed or changes partially or entirely
based on variables other than the market price of the Company’s own equity instruments (such as
interest rates commodity prices or prices of other financial instruments) the contract is classified as a
financial liability.
(4) Derivative financial instruments and embedded derivative instruments
Derivatives are initially measured at fair value on the date the derivative contract is signed and
subsequently measured at fair value. A derivative with a positive fair value is recognized as an asset
while a derivative with a negative fair value is recognized as a liability.Except for the portion of cash flow hedges that are effective and recognized in other comprehensive
income which is reclassified to profit or loss when the hedged item affects profit or loss gains or losses
arising from changes in the fair value of derivatives are directly recognized in profit or loss for the
current period.For hybrid instruments that contain embedded derivatives if the host contract is a financial asset the
hybrid instrument as a whole applies the relevant financial asset classification rules. If the host contract
is not a financial asset and the hybrid instrument is not measured at fair value with changes recognized
in profit or loss and the embedded derivative is not closely related to the host contract in terms of
economic characteristics and risks and an instrument that is identical to the embedded derivative and
exists separately would meet the definition of a derivative the embedded derivative is separated from
the hybrid instrument and treated as a separate derivative financial instrument. If the fair value of the
embedded derivative cannot be separately measured at the acquisition date or on subsequent balance
sheet dates the hybrid instrument as a whole is designated as a financial asset or financial liability
measured at fair value with changes recognized in current profit or loss.
(5) Impairment of financial instruments
The Company recognizes loss provisions based on expected credit losses for financial assets measured
at amortized cost debt investments measured at fair value with changes recognized in other
comprehensive income contract assets lease receivables loan commitments and financial guarantee
contracts.* Measurement of expected credit loss
Expected credit loss refers to the weighted average of the credit losses of financial instruments
weighted by the risk of default. Credit loss refers to the difference between all contractual cash flows
discounted at the original effective interest rate and receivable according to the contract and all cash
flows expected to be collected of the Company i.e. the present value of all cash shortfalls. Among them
credit-impaired purchased or originated financial assets of the Company shall be discounted at the
credit-adjusted effective interest rate of such financial assets.The expected credit loss over the entire life of a financial instrument refers to the expected credit loss
129 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
arising from all potential default events that may occur during the entire expected life of the
instrument.The expected credit loss within the next 12 months refers to the expected credit loss resulting from
default events that may occur within the next 12 months after the balance sheet date (or the expected
life if the instrument's expected life is shorter than 12 months) and is a part of the expected credit loss
over the entire life of the instrument.At each balance sheet date the Company measures the expected credit loss for financial instruments in
different stages separately. If the credit risk of the financial instrument has not significantly increased
since initial recognition it is classified into Stage 1 and the loss provision is measured based on the
expected credit loss over the next 12 months. If the credit risk has significantly increased but no credit
impairment has occurred since initial recognition it is classified into Stage 2 and the loss provision is
measured based on the expected credit loss over the entire life of the instrument. If the financial
instrument has already incurred credit impairment since initial recognition it is classified into Stage 3
and the loss provision is measured based on the expected credit loss over the entire life of the
instrument.For financial instruments with low credit risk at the balance sheet date the Company assumes that
their credit risk has not significantly increased since initial recognition and the loss provision is
measured based on the expected credit loss over the next 12 months.For financial instruments in Stage 1 Stage 2 and those with low credit risk the Company calculates
interest income based on their carrying amount before impairment provisions and the effective interest
rate. For financial instruments in Stage 3 interest income is calculated based on their carrying amount
after impairment provisions and the effective interest rate.For notes receivable accounts receivable receivable financing and contract assets the Company
measures loss provisions based on the expected credit loss over the entire life of the instrument
regardless of whether there is a significant financing component.A. Receivables / contract assets
For notes receivable accounts receivable other receivables receivable financing contract assets and
long-term receivables where there is objective evidence of impairment as well as other items that are
subject to individual impairment testing the Company performs individual impairment tests to
recognize expected credit losses and make provisions for individual impairments.For notes receivable accounts receivable other receivables receivable financing contract assets and
long-term receivables where there is no objective evidence of impairment or when it is not possible to
reasonably assess the expected credit loss for individual financial assets the Company classifies these
financial instruments into groups based on their credit risk characteristics. The expected credit loss is
then calculated on a portfolio basis. The criteria for grouping are as follows:
The criteria for grouping notes receivable are as follows:
130 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Group 1: Commercial acceptance bills
Group 2: Bank acceptance bills
For notes receivable grouped into categories the Company refers to historical credit loss experience
current conditions and forecasts of future economic conditions. The expected credit loss is calculated
based on default risk exposure and the expected credit loss rate over the entire life of the instrument.The criteria for grouping accounts receivable are as follows:
Group 1: Aging group
Group 2: Receivables from related parties within the consolidation scope
For accounts receivable grouped into categories the Company refers to historical credit loss experience
current conditions and forecasts of future economic conditions. A comparison table is prepared that
aligns the aging of accounts receivable with the expected credit loss rate over the entire life of the
instrument. The expected credit loss is then calculated.The criteria for grouping other receivables are as follows:
Group 1: Interest receivable
Group 2: Dividends receivable
Group 3: Other receivables
Group 4: Receivables from related parties within the consolidation scope
For other receivables grouped into categories the Company refers to historical credit loss experience
current conditions and forecasts of future economic conditions. The expected credit loss is calculated
based on default risk exposure and the expected credit loss rate over the next 12 months or the entire
life of the instrument.The criteria for grouping receivable financing are as follows:
Group 1: Notes receivable
Group 2: Accounts receivable
For receivable financing grouped into categories the Company refers to historical credit loss experience
current conditions and forecasts of future economic conditions. The expected credit loss is calculated
based on default risk exposure and the expected credit loss rate over the entire life of the instrument.B. Debt investments and other debt investments
For debt investments and other debt investments the Company calculates expected credit losses based
on the nature of the investment various types of counterparty risk exposures and default risk exposure
using the expected credit loss rate over the next 12 months or the entire life of the instrument.* Low credit risk
If the default risk of a financial instrument is low the borrower has a strong ability to fulfill its
contractual cash flow obligations in the short term and even if adverse economic conditions and
operating environments persist over a longer period they may not necessarily reduce the borrower’s
ability to fulfill its contractual cash flow obligations then the financial instrument is considered to have
131 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
low credit risk.* Significant increase of credit risk
The Company determines whether the credit risk of a financial instrument has significantly increased
since initial recognition by comparing the default probability over the expected life of the financial
instrument at the balance sheet date with the default probability determined at initial recognition. This
helps assess the relative change in the likelihood of default over the instrument’s expected life.In evaluating whether there has been a significant increase in credit risk since initial recognition the
Company considers reasonable and supported information that can be obtained without unnecessary
additional costs or efforts including forward-looking information. The information the Company
considers includes:
A. Whether there has been a significant change in internal price indicators due to changes in credit risk;
B. Whether there have been adverse changes in the business financial or economic conditions that are
expected to significantly affect the debtor’s ability to meet its debt obligations;
C. Whether the actual or expected operating results of the debtor have changed significantly; whether
the regulatory economic or technological environment of the debtor has undergone significant adverse
changes;
D. Whether the following items have changed significantly: the value of collateral as debt mortgage or
the guarantee provided by a third party or the quality of credit enhancement; these changes will
reduce the debtor’s economic motivation to repay the loan within the time limit stipulated in the
contract or impact the probability of default;
E. Whether there has been a significant change in the economic incentives expected to reduce the
debtor’s motivation to repay according to the contractual terms;
F. Expected changes to the loan contract including whether violations of the contract might lead to the
exemption or revision of contractual obligations the provision of interest-free periods interest rate
hikes requests for additional collateral or guarantees or other changes to the contractual framework
of the financial instrument;
G. Whether the debtor’s expected performance and repayment behavior have changed significantly;
H. Whether the contract payment is overdue for 30 days or more.Based on the nature of the financial instrument the Company evaluates whether the credit risk has
significantly increased on an individual instrument or portfolio basis. When evaluating on a portfolio
basis the Company can classify financial instruments based on common credit risk characteristics such
as overdue information and credit risk ratings.Generally if the payment is overdue for more than 30 days the Company determines that the credit
risk of the financial instrument has significantly increased. However unless the Company can obtain
reasonable and supported information without incurring excessive cost or effort that proves the credit
risk has not significantly increased since initial recognition even though the payment is more than 30
132 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
days overdue the credit risk will be considered significantly increased.* Financial assets with credit impairment
The Company assesses at the balance sheet date whether financial assets measured at amortized cost
and debt investments measured at fair value through other comprehensive income have experienced
credit impairment. If one or more events have adverse effects on the expected future cash flow of a
financial asset the financial asset will become a financial asset that has suffered credit impairment. The
following observable information can be regarded as evidence of credit impairment of financial assets:
The issuer or debtor is in serious financial difficulties; the debtor breaches the contract such as default
or overdue payment of interest or principal etc.; the creditor gives concessions to the debtor due to
economic or contractual considerations related to the debtor’s financial difficulties; the concessions will
not be made under any other circumstances; there is a great possibility of bankruptcy or other financial
restructuring of the debtor; the financial difficulties of the issuer or debtor cause the disappearance of
the active market for the financial asset; the purchase or origin of a financial asset at a substantial
discount that reflects the fact that a credit loss has occurred.* Presentation of expected credit loss provisions
To reflect the changes in the credit risk of financial instruments since initial recognition the Company
remeasures the expected credit loss at each balance sheet date. The increase or reversal of the loss
provision resulting from this remeasurement should be recognized as impairment losses or gains in the
current period's profit or loss. For financial assets measured at amortized cost the loss provision
reduces the carrying amount of the financial asset presented on the balance sheet. For debt
investments measured at fair value through other comprehensive income the Company recognizes the
loss provision in other comprehensive income without reducing the carrying amount of the financial
asset.* Write-off
If the Company no longer reasonably expects that the contractual cash flows of a financial asset can be
fully or partially recovered it will directly reduce the carrying amount of the financial asset. This
reduction constitutes the derecognition of the relevant financial asset. This situation typically occurs
when the Company determines that the debtor has no assets or income sources capable of generating
sufficient cash flows to repay the amount being written off.If the previously written-off financial asset is later recovered the recovery is recognized as a reversal of
the impairment loss and included in the profit or loss for the current period.
(6) Transfer of financial assets
The transfer of financial assets refers to the following two situations:
A. Transferring the contractual right to receive the cash flows of a financial asset to another party;
B. Transferring all or part of a financial asset to another party while retaining the contractual right to
receive the cash flows of the financial asset and assuming the contractual obligation to pay the received
133 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
cash flows to one or more payees.* Derecognition of transferred financial assets
If almost all the risks and rewards of ownership of a financial asset have been transferred to the
transferee or if neither the risks and rewards of ownership nor the control of the financial asset have
been retained but the control of the financial asset has been relinquished the financial asset should be
derecognized.When determining whether control of the transferred financial asset has been relinquished the
Company considers the transferee’s ability to sell the financial asset. If the transferee can unilaterally
sell the transferred financial asset to an unrelated third party without additional conditions restricting
the sale the Company has relinquished control of the financial asset.In assessing whether the transfer of a financial asset meets the conditions for derecognition the
Company focuses on the substance of the transfer of the financial asset.When the transfer of a financial asset as a whole meets the derecognition criteria the difference
between the following two amounts should be recognized in the current period's profit or loss:
A. The carrying amount of the transferred financial asset;
B. The consideration received for the transfer plus the amount related to the derecognized portion
from the accumulated fair value changes previously recognized in other comprehensive income (this
applies to financial assets classified as fair value through other comprehensive income under Article 18
of Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of Financial
Instruments).When a partial transfer of a financial asset meets the derecognition criteria the carrying amount of the
entire transferred financial asset should be allocated between the derecognized portion and the
portion that is not derecognized (in this case the retained servicing asset is treated as part of the
continuing recognition of the financial asset) based on their relative fair values at the transfer date. The
difference between the following two amounts should be recognized in current profit or loss:
A. The carrying amount of the derecognized portion at the derecognition date;
B. The consideration received for the derecognized portion plus the amount corresponding to the
derecognized portion from the accumulated fair value changes previously recognized in other
comprehensive income (this applies to financial assets classified as fair value through other
comprehensive income under Article 18 of Accounting Standards for Business Enterprises No. 22 -
Recognition and Measurement of Financial Instruments).* Continued involvement in the transferred financial asset
If neither substantially all the risks and rewards of ownership of the financial assets have been
transferred nor retained and control of the financial asset has not been relinquished the Company
should recognize the relevant financial assets to the extent of its continued involvement in the
transferred financial assets and correspondingly recognize the related liability.
134 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
The extent of continued involvement in the transferred financial asset refers to the degree of risk or
reward the Company retains regarding changes in the value of the transferred financial asset.* Continuing Recognition of the Transferred Financial Asset
If the Company retains substantially all the risks and rewards of ownership of the transferred financial
asset it should continue to recognize the entire transferred financial asset and recognize the
consideration received as a financial liability.The financial asset and the recognized related financial liability must not be offset against each other. In
subsequent accounting periods the Company should continue to recognize the income (or gains)
arising from the financial asset and the expense (or losses) arising from the financial liability.
(7) Offset of financial assets and financial liabilities
In the balance sheet financial assets and financial liabilities are shown separately without offsetting
each other. However if the following conditions are met at the same time the net amount after offset
will be listed in the balance sheet:
The Company has the legal right which is currently enforceable to offset the confirmed amount;
The Company plans to settle on a net basis or realize the financial assets and settle the financial
liabilities at the same time.For the transfer of financial assets that do not meet the derecognition criteria the transferor must not
offset the transferred financial asset against the related liability.
(8) Determination of fair value of financial instruments
The methods for determining the fair value of financial assets and financial liabilities are provided in
Note V.
12.Notes receivable
The recognition and accounting treatment of expected credit losses on receivables are presented in the
note on Financial Instruments.
13.Accounts receivable
The recognition and accounting treatment of expected credit losses on receivables are presented in the
note on Financial Instruments.
14. Receivables financing
The recognition and accounting treatment of expected credit losses on receivables are presented in the
note on Financial Instruments.
15.Other receivables
The recognition and accounting treatment of expected credit losses on receivables are presented in the
note on Financial Instruments.
16.Inventory
(1) Classification of inventory
The Company's inventories are categorized as raw materials supplies (including packaging and
135 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
low-value consumables) work in progress finished goods goods for resale expendable biological
assets and engineering and construction costs. Expendable biological assets include broilers piglets and
fattening pigs.
(2) Valuation method for inventories upon delivery
The delivered materials delivered finished products and delivered expendable biological assets shall
be calculated by weighted average method.
(3) Inventory system of inventories
The Company adopts a perpetual inventory system with inventories to be checked at least once a year.Any inventory gains or losses will be included in profits and losses for the current year.
(4) Amortization method for turnover materials
* Amortization method for low-value consumables
The Company uses the 50% amortization method for ring moulds and wooden pallets and adopts the
one-time write-off method for other low-value consumables.* Amortization method for packaging materials
The Company adopts the one-time write-off method for packaging materials upon issuance.Criteria for Recognition and Provision Method of Inventory Impairment
On the balance sheet date inventory should be valued at the lower of cost and net realizable value. If
the inventory’s cost exceeds its net realizable value the provision for inventory impairment shall be
recognized in current profits and losses.The net realizable value of inventories is determined based on reliable evidence considering the
purpose of holding the inventories the effects of events occurring after the balance sheet date and
other relevant factors.* In the ordinary course of business the net realizable value of inventories held for sale—such as
finished products commodities and materials—is determined by subtracting estimated selling
expenses and relevant taxes from the estimated selling price. For inventories held to fulfill sales or
service contracts their net realizable value is based on the contract price. If the quantity of inventory
exceeds the amount specified in the contract the excess inventory is measured at the general market
price. For materials designated for sale their net realizable value is measured using the prevailing
market price.* During normal production and operation the net realizable value of processed materials is
determined by subtracting estimated costs to complete estimated selling expenses and applicable
taxes from the estimated selling price of the finished products. If the net realizable value of the finished
products exceeds their cost the materials are valued at cost. However if a decline in the material’s
price indicates that the net realizable value of the finished products is lower than their cost the
materials should be valued at their net realizable value. The provision for inventory impairment shall be
recognized for the difference.
136 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
* The Company typically calculates and deducts the provision for inventory impairment based on
individual inventory items. For large quantities of low-priced items the provision is determined and
applied according to inventory categories.* On the balance sheet date if the factors that led to the previous inventory impairment no longer
exist the amount of the impairment shall be reversed. This reversal shall not exceed the original
provision for inventory impairment and the reversed amount should be recognized as part of the
profits and losses for the current period.
17.Contract assets
The Company reports contract assets and contract liabilities on the balance sheet based on the
relationship between performance obligations and customer payments. Amounts the Company is
entitled to receive for transferring goods or providing services—excluding time-based factors—are
recognized as contract assets. Obligations to deliver goods or services in exchange for consideration
already received or receivable from customers are recorded as contract liabilities.Contract assets and contract liabilities are presented separately on the balance sheet. When both arise
from the same contract they are offset and shown as a net amount. If the net balance is a debit it is
reported as “Contract assets” or “Other non-current assets” depending on its liquidity. If the net
balance is a credit it is recognized as “Contract liabilities” or “Other non-current liabilities” based on its
liquidity. Contract assets and contract liabilities from different contracts cannot be offset against each
other.Method of determination and accounting for expected credit loss for contract assets please refer to
Note V-11.
18.Long-term equity investment
The Company’s long-term equity investments include holdings that allow it to exercise control or
significant influence over the investees as well as investments in joint ventures. When the Company is
able to exert significant influence over an investee that entity is considered an associated enterprise.
(1) Criteria for establishing joint control and significant influence over the investee
Joint control refers to shared authority over an arrangement governed by the relevant agreement.Decisions regarding the arrangement's activities can only be made with the unanimous consent of all
participants sharing control. To determine whether joint control exists the first step is to assess
whether all participants or a specific group collectively control the arrangement. If these participants
must act together to make decisions about the arrangement’s activities they are considered to have
joint control. Next it must be evaluated whether decisions related to the arrangement require the
approval of those who collectively control it. Joint control does not exist when two or more participants
simply share control without requiring joint decision-making. Additionally protective rights held by
individual participants are not considered when assessing the existence of joint control.Significant influence refers to the investor’s right to participate in the decision-making processes
137 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
regarding the financial and operational policies of the investee. However it does not grant the investor
control or joint control over the formulation of these policies.When assessing whether the investor has significant influence over the investee consider both the
voting shares directly or indirectly owned by the investor and the potential impact of current
executable voting rights held by the investor and other parties. This includes the effects of convertible
instruments such as warrants stock options and corporate bonds issued by the investee that could be
converted into equity.When the Company owns 20% or more but less than 50% of the voting shares of the investee directly
or indirectly through its subsidiaries it is generally regarded as having a significant influence over the
investee. This assumption holds unless there is clear evidence indicating that the Company is unable to
participate in the investee’s production and operational decisions under those circumstances and does
not exercise significant influence.
(2) Determining the initial investment cost
* The investment cost of long-term equity investments resulting from enterprise mergers shall be
determined in accordance with the following provisions:
A. For a business combination under common control if the merging party provides cash transfers
non-cash assets or assumes debts as consideration the book value of the merged entity’s owners’
equity in the consolidated financial statements of the ultimate controlling party on the merger date will
be recognized as the initial cost of the long-term equity investment. The difference between the initial
investment cost and the actual cash paid non-cash assets transferred and the book value of debts
assumed shall be adjusted against the capital reserve. If the capital reserve is insufficient to cover the
difference the remaining amount shall be adjusted against undistributed profit.B. For a business combination under common control the merging party issues equity securities as
consideration the share of the book value of the merged entity’s owners’ equity in the consolidated
financial statements of the ultimate controlling party—calculated as of the merger date—shall be
recognized as the initial cost of the long-term equity investment. The total face value of the issued
shares will be recorded as capital stock. Any difference between the initial investment cost and the total
face value of the shares issued should be adjusted to the capital reserve. If the capital reserve is
insufficient to cover this difference the remaining amount shall be adjusted against undistributed
profit.C. For a business combination not under common control the fair value of the assets transferred
liabilities incurred or assumed and equity securities issued on the acquisition date to gain control over
the acquiree is recognized as the acquisition cost. This amount is considered the initial investment cost
of the long-term equity investment. Any intermediary expenses incurred by the acquiring party—such
as audit legal valuation consulting fees and other related administrative costs—should be recognized
as expenses for the current period.
138 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
* Except for long-term equity investments acquired through mergers the investment cost for other
long-term equity investments shall be determined in accordance with the following provisions:
A. For long-term equity investments acquired through cash payment the actual purchase price paid
shall be considered the investment cost. The initial investment cost includes expenses taxes and other
necessary costs directly related to the acquisition of the investment.B. For long-term equity investments acquired through the issuance of equity securities the fair value of
the issued securities shall be recognized as the initial investment cost.C. For long-term equity investments acquired through the exchange of non-monetary assets if the
exchange has commercial substance and the fair value of the assets received or surrendered can be
reliably measured then the initial investment cost shall be based on the fair value of the assets
surrendered including relevant taxes. Any difference between the fair value and the book value of the
surrendered assets shall be recognized in current profits or losses. If the exchange does not meet both
of these conditions simultaneously the initial investment cost shall be based on the book value of the
assets surrendered along with applicable taxes and fees.D. For long-term equity investments acquired through debt restructuring the initial recognition is
based on the fair value of the relinquished creditor’s rights and other directly attributable costs. Any
difference between the fair value of these rights and their book value is recognized as a gain or loss in
current profits and losses.
(3) Method for subsequent measurement and recognition of profit and loss
The Company uses the cost method to account for long-term equity investments in entities it can
control while it applies the equity method for investments in associates and joint ventures.* Cost method
For long-term equity investments accounted for using the cost method the carrying amount should be
adjusted when additional investments are made or when investments are withdrawn. Cash dividends or
profits declared and distributed by the investee should be recognized as current investment income.* Equity method
For long-term equity investments accounted for using the equity method the standard accounting
treatment is:
If the Company’s initial investment cost for a long-term equity investment exceeds the fair value of the
investee’s identifiable net assets at the time of investment no adjustment will be made to the initial
investment cost. Conversely if the initial investment cost is less than the fair value of the investee’s
identifiable net assets the difference will be recognized in current profits and losses and the carrying
amount of the long-term equity investment will be adjusted accordingly.The Company recognizes investment income and other comprehensive income based on its share of
the net profit or loss and other comprehensive income realized by the invested entity that should be
enjoyed or shared. Simultaneously it adjusts the carrying amount of the long-term equity investment
139 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
accordingly. The portion to be recognized is calculated based on the profit or cash dividends declared
and distributed by the invested entity and the carrying amount of the long-term equity investment is
reduced accordingly. Adjustments are also made to the carrying amount of long-term equity investment
for other changes in the investee's equity excluding net profit or loss other comprehensive income
and profit distributions and these adjustments are reflected in the owners’ equity. When recognizing
the share of net profit or loss from the invested entity the net profit is adjusted and confirmed based
on the fair value of the identifiable net assets of the investee at the time of acquiring the investment. If
the invested entity’s accounting policies and periods differ from those of the Company its financial
statements are adjusted to align with the Company’s policies and periods and investment income and
other comprehensive income are recognized accordingly. Unrealized gains and losses from internal
transactions between the Company and its associates or joint ventures are offset proportionally to the
Company’s share and investment gains or losses are recognized on this basis. If the unrealized internal
transaction loss is an asset impairment loss it shall be recognized in full.If an entity can exert significant influence over an investee or exercise joint control but does not have
control due to additional investments or other reasons the initial investment cost under the equity
method should be calculated as the combined fair value of the original equity investment and the cost
of the new investment. When the originally held equity investment is classified as other equity
instruments any difference between its fair value and book value along with accumulated gains or
losses previously recognized in other comprehensive income should be reclassified out of other
comprehensive income and included in undistributed profit in the current period when the equity
method is changed.If joint control or significant influence over the investee is lost due to partial disposal of equity or other
reasons the remaining equity shall be measured at its fair value. Any difference between this fair value
and the book value at the date of loss of joint control or influence shall be recognized in current profits
and losses. Additionally any other comprehensive income previously recognized through the equity
method as a result of the original investment should be accounted for in the same manner as a direct
disposal of related assets or liabilities by the investee when the equity method is terminated.
(4) Equity investments held for sale
For any remaining equity investments not classified as assets held for sale the equity method is applied
for accounting purposes.Equity investments in associates or joint ventures that were previously classified as held for sale but no
longer meet the criteria for such classification should be adjusted retrospectively using the equity
method starting from the date they were reclassified. The financial statements for the period during
which these investments were classified as held for sale should be restated accordingly.
(5) Method for impairment tests and provision for impairment
For investments in subsidiaries associates and joint ventures please refer to Note V-25 for the
140 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
procedures on asset impairment provisions.
19.Investment properties
(1) Types of investment properties
Investment property refers to real estate held primarily to generate rental income appreciate in value
or both. It typically includes:
* Leased land use rights.* Land use rights held and to be transferred after appreciation.* Leased buildings.
(2) Measurement method for investment properties
The Company uses the cost model for subsequent measurement of its investment properties. Please
refer to Note V-25 for details on asset impairment provisions.The Company calculates depreciation or amortization of investment properties using the straight-line
method after deducting accumulated impairments and the net residual value from the asset’s cost. The
depreciation period and annual depreciation rate are determined based on the category estimated
service life and expected residual value rate of the investment real estate.Estimated useful
Category Residual value rate (%) Annual depreciation rate (%)
life (year)
Buildings and
10-4032.43-9.70
structures
Land use rights Service life of land use rights
20.Fixed assets
(1) Recognition conditions
The fixed assets refer to tangible assets with relatively high unit value held for commodity production
rendering services lease or operation management with a service life of more than one accounting
year. The fixed assets are recognized when the following conditions are met:
* The economic interests related to the fixed assets are likely to flow into the Company;
* The costs of the fixed assets can be calculated reliably.Subsequent expenditure for fixed assets shall be recorded in cost of fixed assets if recognition criteria
of fixed assets are satisfied otherwise the expenditure shall be recorded in current profit or loss when
incurred.
(2) Method of depreciation
Method of Period of
Item RM value rate % Yearly depreciation %
depreciation depreciation（year）
straight-line
Office and buildings 10-40 3 2.43-9.70
depreciation
Machinery straight-line
1039.70
equipment depreciation
Transportation straight-line
4324.25
equipment depreciation
straight-line
Other equipment 5 3 19.40
depreciation
141 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
21.Construction in progress
(1) Construction in progress is accounted for by project categories based on their approved proposals.
(2) Standard procedures and timeline for capitalizing construction in progress to fixed assets
For the construction in progress project all expenses incurred prior to the asset reaching its expected
usable condition are considered the initial recognition of the fixed asset. This includes construction
costs the original purchase price of machinery and equipment other necessary expenditures to bring
the project to its intended operational state as well as borrowing costs associated with special
financing for the project incurred before the asset becomes usable and borrowing costs from general
loans used during this period. Once the project installation or construction is completed and the asset
reaches its expected usable condition the project under construction is transferred to fixed assets. For
fixed assets that have reached the expected usable state but have not yet undergone final accounting
they are recorded at an estimated value based on the project budget cost or actual expenses incurred
from the date the asset became usable. Depreciation is calculated and recognized in accordance with
the Company’s fixed asset depreciation policies. The original estimated value is adjusted to reflect
actual costs; however previously accrued depreciation remains unchanged.
22.Borrowing costs
(1) Recognition principles and capitalization period for borrowing costs
The Company shall capitalize borrowing costs directly attributable to the acquisition construction or
production of eligible assets and include them in the asset’s cost provided that all of the following
conditions are met simultaneously:
* The asset expenditure has been incurred.* The borrowing costs have been incurred.* The activities required for the purchase construction or production of the assets to achieve their
expected usable condition have begun.Any other borrowing costs discounts premiums or exchange differences should be included in the
current profit and loss.Borrowing costs shall be capitalized only when the acquisition construction or production of eligible
assets proceeds without abnormal interruption. If such interruption exceeds three months
capitalization shall be suspended.Capitalization of borrowing costs shall cease once the assets under construction or production which
meet the capitalization criteria are ready for their intended use or sale. Any borrowing costs incurred
thereafter shall be recognized as expenses in the current period.
(2) Capitalization rate for borrowing costs and method of calculating the capitalized amount
When a special loan is used to acquire construct or produce assets eligible for capitalization the
interest expense for the current period is calculated as the actual interest incurred on the loan minus
any interest income earned from depositing unused funds in the bank or from temporary investments.
142 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
This net amount represents the capitalized interest expense of the special loan.When a general borrowing is used to acquire construct or produce assets eligible for capitalization the
interest to be capitalized should be calculated by multiplying the weighted average asset
expenditure—specifically the portion of accumulated asset costs exceeding the amount financed by
special borrowings—by the capitalization rate of the general borrowing. This capitalization rate is
determined based on the weighted average interest rate of the general borrowings.
23.Biological assets
(1) Classification of biological assets
The Company’s biological assets include consumable biological assets productive biological assets and
public welfare biological assets. The Company measures biological assets at cost for subsequent
measurement.* Consumable biological assets
Consumable biological assets refer to biological assets held for sale or to be harvested as agricultural
products in the future including growing field crops vegetables timber forests and livestock held for
sale etc. Consumable biological assets are initially measured at cost. The cost of self-cultivated
self-established self-propagated or self-bred consumable biological assets consists of necessary
expenditures directly attributable to the assets before they are sold including borrowing costs that
meet the capitalization criteria. Subsequent expenditures such as management and feeding costs
incurred after the harvest of consumable biological assets are recognized in current profits and losses.When consumable biological assets are harvested or sold their costs are transferred at book value
using the weighted average method.* Productive biological assets
Productive biological assets refer to biological assets held for producing agricultural products providing
services or leasing etc. including economic forests fuelwood forests breeding livestock and draught
animals etc. Productive biological assets are initially measured at cost. The cost of self-established or
self-propagated productive biological assets consists of necessary expenditures directly attributable to
the assets before they reach the intended production and operation purposes including borrowing
costs that meet the capitalization criteria.Management and feeding costs incurred by productive biological assets after they are closed (for
forests) or reach the intended production and operation purposes are recognized in current profits and
losses. The difference between the disposal proceeds of productive biological assets (from sale
inventory shortage death or damage) and their book value plus related taxes is recognized in current
profits and losses.* Public welfare biological assets
Public welfare biological assets refer to biological assets mainly for protection and environmental
conservation purposes including windbreak and sand-fixation forests water and soil conservation
143 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
forests and water source conservation forests etc. Public welfare biological assets are initially
measured at cost. The cost of self-established public welfare biological assets consists of necessary
expenditures directly attributable to the assets before they are closed (canopy closure) including
borrowing costs that meet the capitalization criteria.Subsequent expenditures such as management and maintenance costs incurred by public welfare
biological assets after they are closed (canopy closure) are recognized in current profits and losses.Public welfare biological assets are measured at cost for subsequent measurement and no impairment
provisions are made for them.The difference between the disposal proceeds of public welfare biological assets (from sale inventory
shortage death or damage) and their book value plus related taxes is recognized in current profits and
losses.
(2) Useful life and depreciation method of productive biological assets
Depreciation of productive biological assets is calculated using the straight-line method. The
depreciation rate is determined based on the estimated service life and residual value rate of each type
of biological asset as follows:
Anticipated net
Type Service life Depreciation method
residual value
Straight-line service
Pig breeder 36 months 20.00%
life
RMB 22.50 per
Broiler breeder 30 weeks Workload
broiler
Straight-line service
Laying duck 10 months RMB 30.00 per duck
life
Straight-line service
Layer 14 months RMB 21.00 per layer
life
Straight-line service
Breeding cow 6 years 30%
life
The Company reviews the service life estimated net residual value and depreciation method of
productive biological assets at least at the end of each year. If there is a change it shall be treated as a
change in accounting estimate.
24.Intangible assets
(1) Valuation methods for intangible assets
Intangible assets are recorded at their acquisition cost.
(2) The service life and its determination basis estimated situation amortization method or review
procedures
* Estimating the service life of intangible assets with limited service life
Categories Estimated service life(year) Basis
According to the service life
Land use rights Legal life
of land license
144 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Computer software The service life is determined by reference to the period that can
and other bring economic benefits to the Company
At the end of each year the Company will review the service life and amortization method of intangible
assets with limited service lives.If after review there are no changes from previous estimates the current service life and amortization
method will remain unchanged.* If it is not possible to determine the time frame within which intangible assets will generate
economic benefits for the company they should be classified as intangible assets with an indefinite
service life. For such assets the Company shall review their service life at the end of each year. If after
this review the service life remains uncertain an impairment test shall be performed as of the balance
sheet date.* Amortization of intangible assets
For intangible assets with a limited service life the Company determines their service life at the time of
acquisition. These assets are then amortized systematically and reasonably using the straight-line
method over their designated service life. The amortization expense is recorded in either the current
profit and loss or the cost of related assets depending on the beneficiary items. The amortizable
amount is calculated as the asset’s cost minus its estimated residual value. For intangible assets that
have been impaired the accumulated impairment losses are also deducted when determining the net
book value. The residual value of an intangible asset with a limited service life is generally considered
zero unless there is a third-party commitment to purchase the asset at the end of its service life or if
reliable information about an estimated residual value can be obtained from an active market
indicating that a market is likely to exist at the end of the asset’s service life.Intangible assets with uncertain service life should not be amortized. Their service life must be
reviewed annually. If evidence indicates that the asset’s service life is limited its service life should be
estimated accordingly and amortization should be carried out systematically and prudently within that
estimated period.
(3) Sweep scope for R&D expenses and relevant accounting treatments
The Company classifies all expenses directly associated with research and development activities as
R&D expenditures. These include R&D staff salaries direct input costs depreciation expenses and
long-term deferred expenses etc.* The Company considers preparatory activities such as data collection and other relevant
preparations for further development as part of the research phase. Expenses incurred during this
research stage for intangible assets are recognized in the current profit and loss when they occur.* Activities conducted after the Company has completed the research phase will be considered part
of the development stage.Expenditures during the development stage can be recognized as intangible assets only if they
simultaneously meet the following conditions:
145 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
A. It is technically feasible to develop the intangible asset to the point where it can be used or sold.B. It aims to complete the intangible asset for use or sale.C. The manner in which the intangible asset generates economic benefits including demonstrating the
existence of a market for the products created using the asset or for the asset itself. It also involves
confirming that the intangible asset will be used internally and providing evidence of its usefulness.D. It possesses adequate technical financial and other resources to complete the development of the
intangible assets and has the capacity to effectively utilize or sell them.E. The costs associated with the development stage of the intangible asset can be reliably determined.
25.Impairment of long-lived assets
The impairment of long-term equity investments in subsidiaries associates and joint ventures as well
as investment properties fixed assets construction in progress productive biological assets measured
at cost right-of-use assets intangible assets goodwill proven oil and gas mining rights and wells and
related facilities (excluding inventories deferred tax assets and financial assets) measured
subsequently at cost shall be assessed using the following methods:
On the balance sheet date the Company will assess whether there are any indications of potential
asset impairment. If such signs are identified the Company will estimate the recoverable amount and
perform an impairment test. Additionally goodwill arising from business combinations intangible
assets with uncertain service life and intangible assets not yet ready for use must undergo annual
impairment testing regardless of whether there are any signs of impairment.The recoverable amount is determined as the higher of the fair value of the asset less disposal expenses
and the present value of estimated future cash flows generated by the asset. The Company assesses
the recoverable amount on a per-asset basis. If it is challenging to estimate the recoverable amount of a
single asset the Company evaluates the recoverable amount of the asset group to which the asset
belongs. An asset group is recognized based on whether the primary cash inflow it generates is
independent of other assets or other asset groups.When the recoverable amount of an asset or asset group falls below its book value the Company shall
reduce its carrying amount to the recoverable amount. The impairment loss will be recognized in the
current profit and loss and an appropriate provision for asset impairment will be established
simultaneously.Regarding the impairment test for goodwill the book value of goodwill arising from a business
combination should be allocated to the relevant asset groups using a reasonable method from the
acquisition date. If it is difficult to allocate to specific asset groups it should be allocated to the relevant
combination of asset groups. These asset groups or combinations are those that are expected to
benefit from the synergies of the business combination and are not larger than the reporting segments
defined by the Company.During the impairment test if there are any indications of impairment in the asset group or
146 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
combination of asset groups related to goodwill the asset group or groups excluding goodwill should
be tested first. The recoverable amount will be calculated and any resulting impairment loss recognized.Subsequently the asset group or groups containing goodwill will undergo impairment testing with
their carrying amounts compared to their recoverable amounts. If the recoverable amount is lower
than the carrying amount an impairment loss for goodwill should be recognized.Once an asset impairment loss is recognized it cannot be reversed in subsequent accounting periods.
26.Long-term prepaid expenses
Long-term deferred expenses are costs that the Company has already incurred but will be allocated
over the current and subsequent periods with an amortization period exceeding one year.The Company’s long-term deferred expenses are generally amortized over their respective benefit
periods.
27.Contract liabilities
The Company's method for recognizing contract liabilities is detailed in Note V- 17.
28.Employee remuneration
Employee compensation refers to all forms of remuneration the Company provides in exchange for
employees’ services or upon the termination of employment. This includes short-term incentives
post-employment benefits severance packages and other long-term employee benefits. Additionally
benefits extended to employees’ spouses children dependents survivors of deceased employees and
other beneficiaries are also considered part of employee compensation.Based on liquidity employee compensation is recorded under “Employee compensation payable” and
“Long-term employee compensation payable” on the balance sheet.
(1) Accounting treatment of short-term employee compensation
* Basic employee compensation including salary bonuses allowances and subsidies
During the accounting period in which employees provide services the Company recognizes the actual
short-term compensation as a liability and records it as an expense in the current period except for
amounts that are required or permitted by other accounting standards to be capitalized as part of asset
costs.* Employee benefits expenses
Employee benefits expenses incurred by the Company shall be recognized in the current profit and loss
or as part of the cost of relevant assets based on the actual amount incurred. For non-monetary
benefits their value shall be measured at fair value.* Medical insurance premiums industrial injury insurance maternity insurance and other social
insurance contributions along with housing provident fund trade union funds and staff education
funds.During the accounting period in which employees provide services the Company shall calculate and
determine the corresponding employee compensation for social insurance premiums (including
147 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
medical insurance work-related injury insurance maternity insurance and other social insurance
contributions) housing provident fund payments labor union funds and employee education funds in
accordance with applicable regulations. These amounts shall be based on the prescribed accrual basis
and proportions. The corresponding liabilities shall be recognized and included either in the current
profit and loss or as part of the cost of related assets.* Short-term paid leave
The Company recognizes employee compensation for accumulated paid leave when employees provide
services that increase their future paid leave entitlement. This is measured by the expected payment
amount adjusted for any accumulated unused leave rights. For non-cumulative paid absences the
Company recognizes related compensation during the accounting period in which the employee is
actually absent from work.* Short-term profit-sharing plan
If the profit-sharing plan simultaneously meets the following conditions the Company will confirm the
corresponding employee compensation payable:
A. The Company has a legal or constructive obligation to pay employee compensation arising from past
events.B. The amount of the employee compensation obligation arising from the profit-sharing plan can be
reliably estimated
(2) Accounting treatment for post-employment benefits
* Defined contribution plan
During the accounting period in which employees provide services the Company will recognize the
payable amount calculated under the defined contribution plan as a liability. This amount will be
included in current profit and loss or allocated to the cost of related assets.Under the defined contribution plan if it is anticipated that the deposit will not be fully paid within 12
months after the end of the annual Reporting Period during which employees provide the related
services the Company should use an appropriate discount rate. This rate is determined based on the
market yield of treasury bonds or high-quality corporate bonds with similar maturity and currency in an
active market as of the balance sheet date. The total deposit amount is then measured as the present
value of the employee compensation payable discounted at this rate.* Defined benefit plan
A. Determine the present value of the defined benefit plan obligation and the current service cost
Using the expected cumulative unit benefit method relevant demographic and financial variables are
estimated based on unbiased and mutually consistent actuarial assumptions. The obligations stemming
from the defined benefit plan are then measured and the vesting period for these obligations is
determined. The Company discounts the obligations using an appropriate discount rate—derived from
the market yields of treasury bonds or high-quality corporate bonds that match the duration and
148 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
currency of the plan’s obligations on the balance sheet date. This process calculates the present value
of the defined benefit obligations and the current service cost.B. Recognize net liabilities or net assets in defined benefit plans
If the defined benefit plan has assets the Company will recognize a net liability or net asset based on
the difference between the present value of the plan’s obligations and the fair value of its assets. This
reflects either a deficit or a surplus in the plan.If there is a surplus in the defined benefit plan the Company shall measure the plan’s net assets at the
lesser of the surplus amount and the maximum allowable asset ceiling.C. Determine the amount to be included in the assets’ cost or current profit and loss
Service costs including current service costs past service costs and settlement gains or losses. Except
for current service costs that are required or permitted by other accounting standards to be capitalized
as part of asset costs all other service costs are recognized in current profits and losses.The net interest on the net liabilities or net assets of the defined benefit plan—including interest
income from plan assets interest expenses on the plan obligations and interest related to the asset
ceiling—shall be recognized in current profits and losses.D. Determine the amount to be included in other comprehensive income
The adjustments resulting from the re-measurement of the net liabilities or net assets of the defined
benefit plan include:
(a) Actuarial gains or losses which are increases or decreases in the present value of previously
recognized defined benefit plan obligations resulting from changes in actuarial assumptions and
experience adjustments;
(b) The return on plan assets minus the amount included in the net interest on the plan’s net liability or
net assets;
(c) Changes in the impact of the asset ceiling net of the amount included in the net interest on the net
liabilities or net assets of a defined benefit plan.Any changes resulting from the re-measurement of the net liabilities or net assets of the defined
benefit plan are recognized directly in other comprehensive income. These amounts cannot be
reclassified to profit or loss in future periods. Upon the termination of the original defined benefit plan
the Company will transfer all amounts previously recognized in other comprehensive income to
undistributed profits within equity.
(3) Accounting treatment for termination benefits
When the Company offers termination benefits to employees the corresponding employee
compensation liabilities shall be recognized and included in current profits and losses on the earlier of
these two dates:
* When the enterprise cannot unilaterally revoke the termination benefits offered due to plans to
terminate the employment relationship or layoff proposals;
149 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
* When the Company confirms the costs or expenses associated with the reorganization including the
payment of termination benefits.If the termination benefits are not expected to be fully paid within 12 months after the end of the
annual Reporting Period the amount should be discounted using an appropriate discount rate. This
rate should be based on the market yield of treasury bonds or high-quality corporate bonds that match
the period and currency of the defined benefit plan obligations as of the balance sheet date. The
employee compensation payable shall then be measured at this discounted amount.
(4) Accounting treatment for other long-term employee benefits
* Complying with the requirements of the defined contribution plan
For other long-term employee benefits offered by the Company if they qualify as a defined
contribution plan all payable amounts shall be discounted to determine the employee compensation
payable.* Complying with the requirements of the defined benefit plan
At the end of the Reporting Period the Company recognizes employee compensation costs related to
other long-term employee benefits including the following components:
A. Service costs;
B. Net interest on the net liabilities or assets of other long-term employee benefits;
C. Adjustments resulting from the re-measurement of net liabilities or net assets related to other
long-term employee benefits.To simplify the accounting process the total net amount of the above items is incorporated into the
current profit and loss or the cost of related assets.
29.Estimated liabilities
(1) Recognition criteria of estimated liabilities
If the obligations related to contingencies meet all of the following conditions simultaneously the
Company will recognize them as estimated liabilities:
* The obligation refers to the Company’s present obligation.* The performance of the obligation is likely to lead to the outflow of economic benefits from the
Company.* The amount of the obligation can be measured reliably.
(2) Measurement of estimated liabilities
The estimated liabilities are initially recognized based on the best estimate of the expenditure needed
to settle the present obligations considering risks uncertainties the time value of money and other
relevant factors related to contingencies. The carrying amount of these estimated liabilities should be
reviewed at each balance sheet date. If there is clear evidence indicating that the carrying amount no
longer reflects the current best estimate it should be adjusted accordingly.
150 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
30.Share-based payment
(1) Categories of share-based payments
The Company’s share-based payments include both cash-settled and equity-settled arrangements.
(2) Determination method of fair value of equity instruments
* The fair value of shares granted to employees shall be determined based on the current market
price of the Company’s shares adjusted to reflect the specific terms and conditions of the grant
excluding any vesting conditions other than market-based ones.* In many cases obtaining an exact market price for employee stock options can be challenging.When there are no traded options with similar terms and conditions the Company will use an
appropriate option pricing model to estimate the fair value of the options granted.
(3) Basis for determining the best estimate of exercisable equity instruments
On each balance sheet date during the vesting period the Company will make the most accurate
estimate possible based on the latest available information—such as changes in the number of
employees eligible to exercise their options—and will revise the expected number of exercisable equity
instruments accordingly to ensure the best estimate for exercisable equity instruments.
(4) Accounting treatment for implementing share-based payment plans
Cash-settled share-based payments
* For cash-settled share-based payments that can be exercised immediately after the grant the fair
value of the liabilities assumed by the Company should be recognized as part of the relevant costs or
expenses on the grant date with an increase in liabilities accordingly. The fair value of these liabilities
must be re-measured at each balance sheet date and again on the settlement date with any changes
recognized in profit or loss.* For cash-settled share-based payments that can only be exercised after the completion of service
within the vesting period or once specific performance conditions are met the costs or expenses
incurred during the current period should be recognized. The corresponding liabilities should be
recorded at their fair value reflecting the Company’s assumed liabilities on each balance sheet date
within the vesting period. This fair value should be estimated based on the best assessment of the
exercisable conditions.Equity-settled share-based payments
* For equity-settled share-based payments granted in exchange for employee services that can be
exercised immediately after the grant the fair value of the equity instrument should be recognized as
part of the relevant costs or expenses on the grant date with a corresponding increase in capital
reserve.* For equity-settled share-based payments granted in exchange for employee services that become
exercisable only after the completion of service within the vesting period or the satisfaction of specified
performance conditions on each balance sheet date during the vesting period the services received in
151 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
the current period shall be recognized in costs or expenses and capital reserve. The amount is based on
the best estimate of the number of exercisable equity instruments and the fair value of the equity
instruments at the grant date.
(5) Accounting treatment for modifications to share-based payment plans
When the Company amends the share-based payment plan any increase in the fair value of the
granted equity instruments resulting from the modification shall be recognized as an increase in the
services acquired. Similarly if the modification increases the number of equity instruments granted the
additional fair value shall also be recognized as an increase in the services acquired. The increase in fair
value is calculated as the difference between the fair value of the equity instruments before and after
the modification date. If the modification reduces the total fair value of the share-based payment or
alters the plan’s terms and conditions in a way that is unfavorable to employees the accounting
treatment for the services already obtained shall remain unchanged as if the modification had not
occurred unless the Company cancels part or all of the granted equity instruments.
(6) Accounting treatment for terminating a share-based payment plan
If the equity instruments granted are canceled or settled during the vesting period (excluding
cancellations due to failure to meet vesting conditions) the Company:
* considers cancellation or settlement as an acceleration of the exercisable right and the amount
that would have been recognized during the remaining vesting period shall be recognized immediately.* considers all payments made to employees upon cancellation or settlement as equity repurchase.Any amount exceeding the fair value of the equity instrument on the repurchase date will be
recognized as a current expense.If the Company repurchases equity instruments that employees have exercised it will reduce the
owners’ equity. If the purchase price exceeds the fair value of the equity instruments on the repurchase
date the excess will be recognized in current profits and losses.
31.Revenue
(1) General principles
Revenue is the total economic benefits earned from the Company’s regular business activities leading
to an increase in shareholders’ equity. It is not related to the capital invested by shareholders.The Company recognizes revenue when it fulfills its contractual performance obligations i.e. when the
customer obtains control of the relevant goods. Obtaining control of the relevant goods means having
the ability to direct the use of the goods and obtain almost all economic benefits therefrom.When a contract contains two or more performance obligations the Company on the contract
commencement date allocates the transaction price to each performance obligation based on the
relative proportion of the standalone selling prices of the goods or services promised in each
performance obligation and measures revenue based on the transaction price allocated to each
performance obligation.
152 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
The transaction price is the amount of consideration that the Company expects to be entitled to receive
for transferring goods or services to the customer excluding amounts collected on behalf of third
parties. When determining the contract transaction price if there is variable consideration the
Company determines the best estimate of the variable consideration based on the expected value or
the most likely amount and includes in the transaction price an amount that does not exceed the
amount at which a significant reversal of cumulatively recognized revenue is highly unlikely to occur
when the relevant uncertainties are resolved. If a contract contains a significant financing component
the Company determines the transaction price based on the amount payable by the customer in cash
when the customer obtains control of the goods. The difference between the transaction price and the
contract consideration is amortized over the contract period using the effective interest method. For
contracts where the interval between the transfer of control and the customer’s payment does not
exceed one year the Company does not consider the financing component.An obligation is satisfied over time if one of the following conditions is met; otherwise it is satisfied at a
point in time:
* The customer receives and enjoys the economic benefits generated by the Company’s performance
under the contract.* The customer has the right to oversee the goods under construction while the Company is
performing its services.* The products manufactured by the Company in the course of fulfilling the contract serve unique
and indispensable purposes. The Company is entitled to receive payment for the completed portion of
the contract throughout its duration.For performance obligations fulfilled within a specified period the Company shall recognize revenue
based on the progress of performance during that period unless the progress cannot be reasonably
measured. The Company will assess the progress of services using either an input method (such as
costs incurred) or an output method. If the progress cannot be reasonably determined but the
Company expects to be compensated for the costs incurred revenue will be recognized equal to the
costs incurred until the progress can be reliably measured.For performance obligations fulfilled at a specific point in time the Company recognizes revenue when
the customer gains control of the relevant goods or services. To assess whether control has been
transferred the Company will consider the following indicators:
* The customer obtains and consumes the economic benefits from the Company’s performance as
the Company performs;
* The customer has the ability to control the goods under construction during the Company’s
performance;
* The goods produced by the Company in performing its obligations have no alternative use and the
Company has the right to receive payment for the cumulative completed portion of the performance
153 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
up to the present time throughout the contract period.For performance obligations satisfied over time the Company recognizes revenue over that period
based on the progress of performance except when the progress of performance cannot be reasonably
determined. The Company determines the progress of service provision using the input method (or
output method). When the progress of performance cannot be reasonably determined if the Company
expects that the costs incurred can be compensated it recognizes revenue in the amount of the costs
incurred until the progress of performance can be reasonably determined.For performance obligations satisfied at a point in time the Company recognizes revenue when the
customer obtains control of the relevant goods. In judging whether the customer has obtained control
of the goods or services the Company considers the following indicators:
* The Company has a present right to receive payment for the goods or services i.e. the customer
has a present obligation to pay for the goods;
* The Company has transferred the legal ownership of the goods to the customer i.e. the customer
has obtained legal ownership of the goods;
* The Company has transferred physical possession of the goods to the customer i.e. the customer
has physical possession of the goods;
* The Company has transferred significant risks and rewards of ownership of the goods to the
customer i.e. the customer has obtained the significant risks and rewards of ownership of the goods;
* The customer has accepted the goods.Sales return clauses
For sales with sales return clauses when the customer obtains control of the relevant goods the
Company recognizes revenue in the amount of consideration to which it is entitled for transferring the
goods to the customer and recognizes a provision for the amount expected to be refunded due to sales
returns as a liability; at the same time recognizes an asset i.e. refundable return costs in the amount
equal to the carrying amount of the expected returned goods at the time of transfer minus the
estimated costs to recover the goods (including impairment of the value of returned goods). The cost is
transferred at the net amount of the carrying amount of the transferred goods at the time of transfer
minus the cost of the above assets. At each balance sheet date the Company re-estimates future sales
returns and remeasures the above assets and liabilities.Quality assurance obligations
In accordance with contractual agreements legal provisions etc. the Company provides quality
assurance for sold goods constructed projects etc. For assurance-type quality assurance that
guarantees to the customer that the sold goods meet established standards the Company accounts for
it in accordance with Accounting Standards for Business Enterprises No. 13 - Contingencies. For
service-type quality assurance that provides a separate service in addition to guaranteeing that the sold
goods meet established standards to the customer the Company treats it as a separate performance
154 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
obligation allocates part of the transaction price to the service-type quality assurance based on the
relative proportion of the standalone selling prices of the provided goods and service-type quality
assurance and recognizes revenue when the customer obtains control of the service. In evaluating
whether the quality assurance provides a separate service in addition to guaranteeing that the sold
goods meet established standards to the customer the Company considers factors such as whether the
quality assurance is legally required the duration of the quality assurance and the nature of the tasks
that the Company commits to perform.Principal vs. agent
The Company determines whether it acts as a principal or an agent in a transaction based on whether it
has control of the goods or services before transferring them to the customer. If the Company has
control of the goods or services before transferring them to the customer the Company is the principal
and recognizes revenue based on the total amount of consideration received or receivable. Otherwise
the Company is an agent and recognizes revenue based on the amount of commission or handling fee it
expects to be entitled to which shall be determined based on the net amount after deducting the
amounts payable to other relevant parties from the total amount of consideration received or
receivable or based on the agreed commission amount or ratio etc.Consideration payable to customers
If a contract contains consideration payable to a customer unless the consideration is for obtaining
other distinct goods or services from the customer the Company offsets the payable consideration
against the transaction price and reduces current revenue at the later of the date when the relevant
revenue is recognized and the date when the payment (or commitment to pay) to the customer is
made.Customer’s unexercised contractual rights
When the Company receives advance payments from customers for the sale of goods or services it first
recognizes the amount as a liability and converts it to revenue only when the relevant performance
obligations are fulfilled. When the Company’s advance payments are non-refundable and the customer
may waive all or part of their contractual rights if the Company expects to be entitled to the amount
related to the customer’s waived contractual rights it recognizes the above amount as revenue in
proportion to the pattern of the customer’s exercise of contractual rights; otherwise the Company
converts the relevant balance of the liability to revenue only when the probability of the customer
requesting performance of the remaining obligations is extremely low.Contract modifications
When there is a modification to the construction contract between the Company and the customer:
* If the contract modification adds distinct construction services and contract price and the new
contract price reflects the standalone selling price of the additional construction services the Company
accounts for the contract modification as a separate contract.
155 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
* If the contract modification does not fall into the first scenario above and the transferred
construction services and untransferred construction services at the contract modification date are
distinct the Company treats it as the termination of the original contract and combines the
unperformed part of the original contract with the contract modification part to form a new contract
for accounting treatment.* If the contract modification does not fall into the first scenario above and the transferred
construction services and untransferred construction services at the contract modification date are not
distinct the Company accounts for the contract modification part as an integral part of the original
contract and the impact on recognized revenue arising therefrom is adjusted to current revenue at the
contract modification date.
(2) Specific methods
The specific methods for the Company’s revenue recognition are as follows:
The Company’s sales revenue mainly consists of sales revenue from goods such as feed products feed
raw materials poultry products commercial pigs etc. The Company recognizes revenue when payment
has been received (cash sales or advance payment method) or is expected to be recoverable (credit
sales method) and the goods have been delivered to the customer in accordance with the contractual
agreement and the customer has obtained control of the relevant goods
32.Contract costs
Contract costs are divided into contract performance costs and contract acquisition costs.The Company recognizes costs incurred to fulfill a contract as an asset (contract performance costs)
when all of the following conditions are met:
* The cost is directly related to a current or expected contract including direct labor direct materials
manufacturing expenses (or similar expenses) costs explicitly borne by the customer and other costs
incurred solely because of the contract.* The cost increases the Company’s future resources to fulfill performance obligations.* The cost is expected to be recoverable.The incremental costs incurred by the Company to obtain a contract that are expected to be
recoverable are recognized as an asset (contract acquisition costs).Assets related to contract costs are amortized on the same basis as the revenue recognition of the
goods or services related to the asset; however if the amortization period of contract acquisition costs
does not exceed one year the Company recognizes them in current profits and losses when incurred.If the carrying amount of an asset related to contract costs exceeds the difference between the
following two items the Company will recognize an impairment provision for the excess amount
recognize it as an asset impairment loss and further consider whether to accrue a provision for
estimated liabilities related to loss-making contracts:
* The remaining consideration expected to be obtained from the transfer of goods or services related
156 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
to the asset;
* The estimated costs to be incurred to transfer the related goods or services.If the above asset impairment provision is subsequently reversed the carrying amount of the asset
after reversal shall not exceed the carrying amount of the asset on the reversal date assuming no
impairment provision was recognized.Contract performance costs recognized as assets with an amortization period not exceeding one year
or a normal operating cycle at initial recognition are presented under the “Inventory” item; those with
an amortization period exceeding one year or a normal operating cycle at initial recognition are
presented under the “Other non-current assets” item.Contract acquisition costs recognized as assets with an amortization period not exceeding one year or
a normal operating cycle at initial recognition are presented under the “Other current assets” item;
those with an amortization period exceeding one year or a normal operating cycle at initial recognition
are presented under the “Other non-current assets” item.
33.Government grant
(1) Recognition of government subsidies
Government grants are recognized only when both of the following conditions are met:
* The Company is able to meet the conditions attached to the government grant;
* The Company is able to receive the government grant.
(2) Measurement of government grants
If a government grant is a monetary asset it is measured at the amount received or receivable. If it is a
non-monetary asset it is measured at fair value; if fair value cannot be reliably determined it is
measured at a nominal amount of RMB 1.
(3) Accounting treatment for government grants
* Asset-related government grants
Government grants obtained by the Company for the purchase construction or other formation of
long-term assets are classified as asset-related government grants. Asset-related government grants are
recognized as deferred income and amortized into profits and losses in a reasonable and systematic
manner over the service life of the relevant assets. Government grants measured at a nominal amount
are recognized directly in current profits and losses. If the relevant asset is sold transferred scrapped
or damaged before the end of its service life the remaining balance of the related deferred income is
transferred to the profit or loss of the current period of asset disposal.* Income-related government grants
Government grants other than asset-related government grants are classified as income-related
government grants. Income-related government grants are accounted for as follows depending on the
circumstances:
Those used to compensate for the Company’s relevant costs expenses or losses in future periods are
157 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
recognized as deferred income and included in current profits and losses in the period when the
relevant costs expenses or losses are recognized;
Those used to compensate for the Company’s already incurred relevant costs expenses or losses are
recognized directly in current profits and losses.For government grants that include both asset-related and income-related components the different
components are accounted for separately; if it is difficult to distinguish the entire grant is classified as
income-related government grant.Government grants related to the Company’s daily activities are included in other income based on the
economic substance of the transaction. Government grants unrelated to the Company’s daily activities
are included in non-operating income and expenses.* Policy-based preferential loan interest grants
If the finance department allocates the interest grant funds to the lending bank and the lending bank
provides loans to the Company at a policy-based preferential interest rate the actual amount of the
loan received is recognized as the book value of the loan and the relevant borrowing costs are
calculated based on the principal of the loan and the policy-based preferential interest rate.If the finance department allocates the interest grant funds directly to the Company the Company
offsets the corresponding interest grant against the relevant borrowing costs.* Repayment of government grants
When a recognized government grant needs to be repaid if the initial recognition offset the carrying
amount of the relevant asset the carrying amount of the asset is adjusted; if there is a balance of
relevant deferred income the carrying balance of the relevant deferred income is offset and the excess
is included in current profits and losses; in other cases it is recognized directly in current profits and
losses.
34.Deferred income tax assets or deferred income tax liabilities
The Company generally uses the balance sheet liability method to recognize and measure the effects of
taxable and deductible temporary differences on income tax which are recorded as deferred income
tax liabilities or deferred income tax assets based on the differences between the carrying amounts of
assets and liabilities on the balance sheet date and their respective tax bases. The Company does not
discount deferred income tax assets or liabilities.
(1) Recognition of deferred income tax assets
For deductible temporary differences as well as deductible losses and tax credits that can be carried
forward to future years their impact on income tax is calculated using the tax rate expected at the time
of reversal. These amounts are recognized as deferred income tax assets but only to the extent that
the Company is likely to generate future taxable income to offset these deductible temporary
differences deductible losses and tax credits.The impact of deductible temporary differences on income tax arising from the initial recognition of
158 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
assets or liabilities in transactions or events with the following characteristics is not recognized as a
deferred income tax asset:
A. The transaction is not a business combination;
B. At the time of the transaction it neither affects accounting profit nor taxable income (or deductible
losses).However the exemption from initially recognizing deferred income tax liabilities and assets does not
apply to a single transaction that simultaneously meets the above two conditions and results in
equivalent taxable temporary differences and deductible temporary differences. For such transactions
the Company recognizes the corresponding deferred income tax liabilities and assets at the time of the
transaction for the taxable and deductible temporary differences arising from the initial recognition of
assets and liabilities.For deductible temporary differences related to investments in subsidiaries associates and joint
ventures the impact on income tax is recognized as a deferred income tax asset only if both of the
following conditions are met:
A. The temporary differences are likely to reverse in the foreseeable future;
B. It is likely that future taxable income will be available to offset the deductible temporary differences.On the balance sheet date if there is clear evidence indicating that sufficient taxable income is likely to
be generated in the future to offset the deductible temporary differences the previously unrecognized
deferred income tax assets are recognized.On the balance sheet date the Company reviews the carrying amount of deferred income tax assets. If
it is likely that sufficient taxable income will not be available in the future to realize the benefits of
deferred income tax assets the carrying amount of deferred income tax assets is written down. When it
becomes likely that sufficient taxable income will be available the written-down amount is reversed.
(2) Recognition of deferred income tax liabilities
The Company measures the impact of all taxable temporary differences on income tax using the income
tax rate expected for the period of reversal and recognizes such impact as deferred income tax liabilities
except in the following cases:
* The impact of taxable temporary differences arising from the following transactions or events on
income tax is not recognized as deferred income tax liabilities:
A. The initial recognition of goodwill;
B. The initial recognition of assets or liabilities in a transaction that is not a business combination and
at the time of the transaction neither affects accounting profit nor taxable income or deductible losses.* For taxable temporary differences related to investments in subsidiaries joint ventures and
associates the impact on income tax is generally recognized as a deferred income tax liability except
when both of the following conditions are met:
A. The Company has the ability to control the timing of the reversal of the temporary differences;
159 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B. It is unlikely that the temporary differences will reverse in the foreseeable future.
(3) Recognition of deferred income tax liabilities or assets arising from specific transactions or events
* Deferred income tax liabilities or assets related to business combinations
For taxable or deductible temporary differences arising from business combinations not under common
control when recognizing deferred income tax liabilities or assets the related deferred tax expenses (or
gains) are generally used to adjust the goodwill recognized in the business combination.* Items directly included in owners’ equity
Current tax and deferred tax related to transactions or events directly included in owners’ equity are
included in owners’ equity. Transactions or events where the impact of temporary differences on
income tax is included in owners’ equity include: other comprehensive income arising from changes in
the fair value of other debt investments adjustments to opening undistributed profit through
retrospective application of changes in accounting policies or retrospective restatement of prior period
(significant) accounting errors and initial recognition of hybrid financial instruments with both liability
and equity components in owners’ equity.* Deductible losses and tax credits
A. Deductible losses and tax credits arising from the Company’s own operations
Deductible losses are losses determined in accordance with tax laws that are allowed to be offset
against taxable income in future years. Unused losses (deductible losses) and tax credits that can be
carried forward to future years are treated as deductible temporary differences. When it is likely that
sufficient taxable income will be available in future periods to utilize these deductible losses or tax
credits a deferred income tax asset is recognized to the extent of the likely taxable income with a
corresponding reduction in income tax expense for the current period.B. Deductible unused losses of the acquired company arising from a business combination
In a business combination if the Company acquires deductible temporary differences of the acquiree
that do not meet the criteria for recognizing deferred income tax assets on the acquisition date they
are not recognized. Within 12 months after the acquisition date if new or additional information
indicates that the circumstances existing at the acquisition date make it likely that the economic
benefits from the acquiree’s deductible temporary differences will be realized the related deferred
income tax assets are recognized with a corresponding reduction in goodwill. If goodwill is insufficient
to absorb the amount the excess is recognized in current profit or loss; otherwise deferred income tax
assets related to the business combination are recognized in current profit or loss.* Temporary differences arising from consolidation eliminations
When preparing consolidated financial statements if temporary differences arise between the carrying
amounts of assets and liabilities in the consolidated balance sheet and their tax bases in the respective
tax jurisdictions (e.g. due to elimination of unrealized internal sales profits and losses) deferred
income tax assets or liabilities are recognized in the consolidated balance sheet with a corresponding
160 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
adjustment to income tax expense in the consolidated income statement except for deferred tax
related to transactions or events directly included in owners’ equity or business combinations.* Equity-settled share-based payments
If tax laws allow the deduction of expenses related to share-based payments for tax purposes during
the period when such costs are recognized in accordance with accounting standards the Company
estimates the deductible amount based on information available at the end of the accounting period to
determine the tax basis and resulting temporary differences and recognizes the related deferred
income tax if the recognition criteria are met. If the expected future deductible amount exceeds the
share-based payment costs recognized under accounting standards the tax impact of the excess is
recognized directly in owners’ equity.* Dividends on financial instruments classified as equity instruments
For financial instruments classified as equity instruments by the Company as the issuer if related
dividend payments are deductible for enterprise income tax purposes under tax regulations the
Company recognizes the related income tax impact when recognizing dividends payable. The income
tax impact of dividends is included in current profit or loss if the distributed profits originate from
transactions or events that previously generated profit or loss; if the distributed profits originate from
transactions or events previously recognized in owners’ equity the income tax impact is included in
owners’ equity.
(4) Basis for presenting deferred income tax assets and deferred income tax liabilities on a net basis
The Company presents deferred income tax assets and deferred income tax liabilities on a net basis
only if both of the following conditions are met:
* The Company has a legal right to settle current income tax assets and current income tax liabilities
on a net basis;
* The deferred income tax assets and liabilities are related to income tax levied by the same tax
authority on the same taxable entity or on different taxable entities but in each future period of
significance when the deferred tax assets and liabilities reverse the relevant taxable entities intend to
settle current income tax assets and liabilities on a net basis or to realize assets and settle liabilities
simultaneously.
35.Lease
(1) Lease identification
At the contract commencement date the Company assesses whether a contract is or contains a lease.A contract is or contains a lease if one party to the contract transfers the right to control the use of one
or more identified assets for a period of time in exchange for consideration. To determine whether a
contract transfers the right to control the use of an identified asset for a period of time the Company
evaluates whether the customer in the contract has the right to obtain substantially all of the economic
benefits from using the identified asset during the period and has the right to direct the use of the
161 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
identified asset during that period.
(2) Identification of separate leases
If a contract contains multiple separate leases the Company separates the contract and applies
accounting treatment to each separate lease individually. A right to use an identified asset constitutes a
separate lease in the contract if both of the following conditions are met: * the lessee can benefit
from using the asset either on its own or together with other readily available resources; * the asset
is not highly dependent on or highly interrelated with other assets in the contract.
(3) Accounting treatment for lease modifications
* Lease modifications accounted for as a separate lease
A lease modification is accounted for as a separate lease if both of the following conditions are met: A.The modification increases the scope of the lease by adding the right to use one or more additional
assets; B. The additional consideration for the modification is commensurate with the stand-alone price
for the increase in scope adjusted for the specific circumstances of the contract.* Lease modifications not accounted for as a separate lease
A. The Company as lessee
On the effective date of the lease modification the Company re-determines the lease term and
remeasures the lease liability by discounting the modified lease payments using a revised discount rate.When calculating the present value of the modified lease payments the interest rate implicit in the
lease for the remaining lease term is used as the discount rate; if the implicit interest rate cannot be
determined the incremental borrowing rate at the effective date of the modification is used.The impact of the above adjustment to the lease liability is accounted for as follows:
If the lease modification reduces the lease scope or shortens the lease term the carrying amount of the
right-of-use asset is reduced and any gain or loss arising from the partial or full termination of the lease
is recognized in current profit or loss;
For other lease modifications the carrying amount of the right-of-use asset is adjusted accordingly.B. The Company as lessor
For modifications to operating leases the Company accounts for the modification as a new lease from
the effective date with any prepaid or accrued lease payments related to the original lease treated as
payments for the new lease.For modifications to finance leases that are not accounted for as a separate lease the Company
accounts for the modified lease as follows: If the modification would have resulted in a classification as
an operating lease had it been in effect at the lease commencement date the Company accounts for
the modification as a new lease from the effective date with the lease investment net before the
modification recognized as the carrying amount of the leased asset; if the modification would have
resulted in a classification as a finance lease had it been in effect at the lease commencement date the
Company accounts for the modification in accordance with the provisions for contract modifications or
162 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
renegotiations.
(4) Sale and leaseback
The Company assesses whether the asset transfer in a sale and leaseback transaction qualifies as a sale
in accordance with Note V-31.The Company as seller (lessee)
If the asset transfer does not qualify as a sale the Company continues to recognize the transferred
asset recognizes a financial liability equal to the transfer proceeds and accounts for the financial
liability in accordance with Note V-11.If the asset transfer qualifies as a sale the Company measures the right-of-use asset arising from the
leaseback based on the portion of the original asset’s carrying amount attributable to the right of use
retained and recognizes gains or losses only to the extent of the rights transferred to the lessor.The Company as buyer (lessor)
If the asset transfer does not qualify as a sale the Company does not recognize the transferred asset
recognizes a financial asset equal to the transfer proceeds and accounts for the financial asset in
accordance with Note V-11.If the asset transfer qualifies as a sale the Company accounts for the asset purchase in accordance with
other applicable accounting standards and accounts for the lease in accordance with the relevant
provisions.Accounting treatment for short-term leases and leases of low-value assets as a lessee
At the lease commencement date the Company classifies leases with a lease term of 12 months or less
and no purchase option as short-term leases; leases of a single asset that is of low value when new are
classified as leases of low-value assets. If the Company subleases or expects to sublease a leased asset
the original lease is not classified as a lease of a low-value asset.For all short-term leases and leases of low-value assets the Company recognizes lease payments as an
expense in profit or loss on a straight-line basis over the lease term.Except for short-term leases and leases of low-value assets accounted for using the simplified method
the Company recognizes a right-of-use asset and a lease liability at the lease commencement date.* Right-of-use assets
A right-of-use asset is the lessee’s right to use an underlying asset for the lease term.At the lease commencement date the right-of-use asset is initially measured at cost which includes:
The initial measurement amount of the lease liability;
Lease payments made on or before the lease commencement date less any lease incentives received;
Initial direct costs incurred by the lessee;
Estimated costs to be incurred by the lessee to dismantle and remove the underlying asset restore the
site on which it is located or restore the underlying asset to the condition required by the lease terms.These costs are recognized and measured in accordance with the provisions for provisions (see Note
163 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
V-29). Costs incurred for the production of inventories are included in the cost of inventories.Depreciation of right-of-use assets is calculated using the straight-line method by category. If it is
reasonably certain that the lessee will obtain ownership of the underlying asset by the end of the lease
term depreciation is calculated over the estimated remaining useful life of the underlying asset based
on the right-of-use asset category and estimated residual value rate; otherwise depreciation is
calculated over the shorter of the lease term and the estimated remaining useful life of the right-of-use
asset based on the right-of-use asset category.The depreciation methods estimated useful lives residual value rates and annual depreciation rates by
category of right-of-use assets are as follows:
Depreciation Estimated useful
Category Residual rates (%) Annual depreciation rates %
method life (year)
straight‐line
Housing & Buildings 5-20 0 5.00-20.00
method
straight‐line
Equipment 2-20 0 5.00-50.00
method
straight‐line
Land 5-40 0 2.50-20.00
method
Accounting treatment for leases as a lessor
At the lease commencement date the Company classifies a lease as a finance lease if it transfers
substantially all the risks and rewards incidental to ownership of the underlying asset; all other leases
are classified as operating leases.* Operating leases
Rental income from operating leases is recognized on a straight-line basis over the lease term. Initial
direct costs are capitalized and amortized on the same basis as rental income recognized in current
profit or loss over the lease term. Variable lease payments from operating leases that are not included
in the measurement of lease receivables are recognized in current profit or loss when incurred.* Finance leases
At the lease commencement date the Company recognizes a finance lease receivable at the net
investment in the lease (the sum of the present value of lease payments not yet received at the lease
commencement date and unguaranteed residual value discounted using the interest rate implicit in
the lease) and derecognizes the leased asset. Interest income is recognized in each period during the
lease term using the interest rate implicit in the lease.Variable lease payments from finance leases that are not included in the measurement of the net
investment in the lease are recognized in current profit or loss when incurred.
36.Other significant accounting policies and accounting estimates
Accounting of hedging
(1) Classification of hedges
The Company classifies hedges into fair value hedges cash flow hedges and net investment hedges in
164 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
overseas operations.* Fair value hedge. It refers to hedging activities conducted to mitigate the risk of changes in the fair
value of recognized assets or liabilities unrecognized firm commitments or components of the
aforementioned items. The fair value changes are caused by specific risks that will impact the
Company's profit or other comprehensive income.* Cash flow hedge refers to the hedging of cash flow risk. The change in cash flow is derived from
specific risks associated with recognized assets or liabilities expected transactions that are likely to
occur or components of the above-mentioned items and will affect the enterprise's profit or loss.* Net investment hedge in overseas operations refers to the hedging of the foreign exchange risk
exposure of net investments in overseas operations. The hedged risk in a net investment hedge in
overseas operations refers to the translation difference between the functional currency of the
overseas operation and that of the parent company.
(2) Hedging instruments and hedged items
Hedging instruments are financial instruments designated by the Company for hedging whose changes
in fair value or cash flows are expected to offset changes in the fair value or cash flows of the hedged
items. They include：
* Derivative instruments measured at fair value with changes recognized in current profit or loss
except for written options. A written option may be used as a hedging instrument only when hedging a
purchased option (including a purchased option embedded in a hybrid contract). Derivatives embedded
in a hybrid contract that are not separated cannot be used as separate hedging instruments.* Non-derivative financial assets or non-derivative financial liabilities measured at fair value with
changes recognized in current profit or loss except for financial liabilities designated as measured at
fair value with changes recognized in current profit or loss and whose fair value changes due to changes
in their own credit risk are recognized in other comprehensive income.An entity's own equity instruments are not financial assets or financial liabilities and cannot be used as
hedging instruments.A hedged item is an item that exposes the Company to the risk of changes in fair value or cash flows is
designated as the hedged object and can be reliably measured. The Company designates the following
individual items combinations of items or components thereof as hedged items:
* Recognized assets or liabilities.* Unrecognized firm commitments. A firm commitment is a legally binding agreement to exchange a
specific quantity of resources at an agreed price on a specific future date or period.* Highly probable expected transactions. An expected transaction is a transaction that is not yet
committed but is expected to occur.* Net investments in overseas operations.The above-mentioned components of an item are parts that are less than the overall changes in fair
165 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
value or cash flows of the item. The Company designates the following components of an item or
combinations thereof as hedged items:
* The portion of the overall changes in fair value or cash flows of an item that is attributable to one or
more specific risks (risk components). Based on assessment in a specific market environment the risk
component shall be separately identifiable and reliably measurable. Risk components also include
portions where changes in the fair value or cash flows of the hedged item are only above or below a
specific price or other variable.* One or more selected contractual cash flows.* Components of the nominal amount of an item i.e. specific portions of the overall amount or
quantity of the item which may be a certain proportion of the whole item or a specific tranche of the
whole item. If a tranche includes an early repayment right whose fair value is affected by changes in the
hedged risk such tranche shall not be designated as a hedged item in a fair value hedge unless the
effect of the early repayment right is included when measuring the fair value of the hedged item.
(3) Evaluation of hedging relationship
At the inception of a hedging relationship the Company formally designates the hedging relationship
and prepares a formal written document specifying the hedging relationship risk management
objectives and risk management strategies. This document sets out the hedging instruments hedged
items the nature of the hedged risk and the Company's method for assessing hedge effectiveness.Hedge effectiveness is the degree to which changes in the fair value or cash flows of the hedging
instrument offset changes in the fair value or cash flows of the hedged item attributable to the hedged
risk. Such hedges are continuously evaluated on and after the initial designation date to ensure they
meet the requirements for hedge effectiveness.The Company discontinues hedge accounting when the hedging instrument expires is sold terminated
or exercised (excluding renewals or replacements that are part of the hedging strategy which are not
treated as expirations or terminations) or when changes in risk management objectives result in the
hedging relationship no longer meeting the risk management objectives or the economic relationship
between the hedged item and the hedging instrument ceases to exist or credit risk begins to dominate
the value changes arising from the economic relationship between the hedged item and the hedging
instrument or the hedge no longer meets other conditions for hedge accounting.If a hedging relationship no longer meets the requirements for hedge effectiveness due to the hedge
ratio but the risk management objective for which the hedging relationship was designated remains
unchanged the Company rebalances the hedging relationship.
(4) Recognition and measurement
If the conditions for applying hedge accounting are met the following treatments apply:
* Fair value hedge
Gains or losses from hedging instruments are recognized in current profit or loss. If hedging a
166 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
designated non-trading equity instrument investment (or component thereof) measured at fair value
with changes recognized in other comprehensive income gains or losses from the hedging instrument
are recognized in other comprehensive income. Gains or losses on the hedged item arising from the
hedged risk are recognized in current profit or loss with a corresponding adjustment to the carrying
amount of the recognized hedged item not measured at fair value. If the hedged item is a designated
non-trading equity instrument investment (or component thereof) measured at fair value with changes
recognized in other comprehensive income gains or losses arising from the hedged risk are recognized
in other comprehensive income and no adjustment is needed as its carrying amount is already
measured at fair value.For fair value hedges of financial instruments (or components thereof) measured at amortized cost
adjustments to the carrying amount of the hedged item are amortized using the effective interest rate
recalculated from the commencement of amortization and recognized in current profit or loss. The
amortization shall start from the adjustment date and shall not be later than the date when
adjustments for hedge gains or losses cease for the hedged item. For hedged items that are financial
assets (or components thereof) measured at fair value with changes recognized in other
comprehensive income cumulative recognized hedge gains or losses are amortized in the same manner
and recognized in current profit or loss without adjusting the carrying amount of the financial asset (or
component thereof).For a hedged item that is an unrecognized firm commitment (or component thereof) cumulative
changes in fair value attributable to the hedged risk after designation of the hedging relationship are
recognized as an asset or liability with related gains or losses recognized in current profit or loss. When
the firm commitment is fulfilled to acquire an asset or assume a liability the initial recognition amount
of the asset or liability is adjusted to include the cumulative changes in fair value of the designated
hedged item.* Cash flow hedge
The effective portion of gains or losses on the hedging instrument is recognized in other comprehensive
income as a cash flow hedge reserve; the ineffective portion (i.e. other gains or losses after deducting
those recognized in other comprehensive income) is recognized in current profit or loss. The amount of
the cash flow hedge reserve is determined as the lower of the absolute amounts of: * cumulative
gains or losses on the hedging instrument since the inception of the hedge; * cumulative changes in
the present value of expected future cash flows of the hedged item since the inception of the hedge
If the hedged expected transaction is subsequently recognized as a non-financial asset or non-financial
liability or forms a firm commitment accounted for as a fair value hedge the cash flow hedge reserve
previously recognized in other comprehensive income is reclassified to the initial recognition amount of
the asset or liability. For other cash flow hedges the cash flow hedge reserve recognized in other
comprehensive income is reclassified to current profit or loss in the same period when the hedged
167 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
expected cash flows affect profit or loss (e.g. when expected sales occur).* Net investment hedge in overseas operations
For hedges of net investments in overseas operations the effective portion of gains or losses on the
hedging instrument is recognized directly in other comprehensive income; the ineffective portion is
recognized in current profit or loss. When the overseas operation is disposed of the gains or losses on
the hedging instrument reflected in other comprehensive income are reclassified to current profit or
loss.
37.Changes of important accounting policies and estimates
Names of affected financial
Changes in accounting policies and reasons Amount affected
statement items
Implementation of Interpretation No. 17 of
the Accounting Standards for Business
Enterprises
The implementation of the
On October 25 2023 the Ministry of
relevant provisions of
Finance issued Interpretation No. 17 of the
Interpretation 17 has no
Accounting Standards for Business
material impact on the
Enterprises (Caikuai [2023] No. 21
Company's financial
hereinafter referred to as "Interpretation
statements for the reporting
17") which became effective on January 1
period.
2024. The Company has applied the
provisions of Interpretation 17 starting from
January 1 2024.Reclassification of Assurance-Type Warranty
Expenses
The Ministry of Finance in the 2024
Compilation of Application Guidelines for The implementation of this
Accounting Standards for Business provision has no material
Enterprises (issued in March 2024) impact on the Company's
and Interpretation No. 18 of the Accounting financial statements for the
Standards for Business Enterprises (issued on reporting period.December 6 2024) stipulates that
assurance-type warranty expenses shall be
recognized in operating costs.
38.Others
(1) Measurement of fair value
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date.The Company measures the fair value of relevant assets or liabilities using prices from the principal
market. In the absence of a principal market the Company uses prices from the most advantageous
market. The Company applies assumptions that market participants would use to maximize their
economic benefits when pricing the asset or liability.The principal market is the market with the highest volume and level of activity for the relevant asset or
liability. The most advantageous market is the market that maximizes the amount received from selling
168 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
the asset or minimizes the amount paid to transfer the liability after considering transaction costs and
transportation costs.For financial assets or liabilities with an active market the Company determines their fair value using
quoted prices in such markets. For financial instruments without an active market the Company uses
valuation techniques to determine their fair value.When measuring non-financial assets at fair value the Company considers the ability of market
participants to generate economic benefits by using the asset for its highest and best use or by selling
it to other market participants who would use it for that purpose.* Valuation techniques
The Company uses valuation techniques that are appropriate in the current circumstances and
supported by sufficient available data and information. The primary valuation techniques used include
the market approach income approach and cost approach. The Company measures fair value using
methods consistent with one or more of these techniques. When multiple valuation techniques are
used the Company evaluates the reasonableness of each result and selects the amount that best
represents fair value in the current circumstances.In applying valuation techniques the Company prioritizes relevant observable inputs. Unobservable
inputs are used only when observable inputs are unavailable or impracticable to obtain. Observable
inputs are those derived from market data reflecting assumptions that market participants would use
in pricing the asset or liability. Unobservable inputs are those not derived from market data based on
the best available information about assumptions that market participants would use in pricing the
asset or liability.* Fair value hierarchy
The Company classifies inputs used in fair value measurement into three levels prioritizing Level 1
inputs first followed by Level 2 and then Level 3. Level 1 inputs are unadjusted quoted prices in active
markets for identical assets or liabilities at the measurement date. Level 2 inputs are observable inputs
(directly or indirectly) for the asset or liability other than Level 1 inputs. Level 3 inputs are
unobservable inputs for the asset or liability.
(2) Share repurchases
* When the Company reduces its capital by repurchasing its own shares upon approval in accordance
with legal procedures it reduces share capital by the total par value of the canceled shares. The
difference between the repurchase price (including transaction costs) and the par value of the shares is
adjusted against equity: any excess over the total par value is deducted from capital surplus (share
premium) then from undistributed profit and finally from undistributed profits in that order; any
shortfall below the total par value is added to capital surplus (share premium).* Repurchased shares are accounted for as treasury shares until canceled or transferred with all
repurchase costs recognized as the cost of treasury shares.
169 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
* When treasury shares are transferred any portion of the transfer proceeds that exceeds the cost of
the treasury shares shall be credited to capital reserve (share premium). Any portion that is less than
the cost of the treasury shares shall be charged against capital reserve (share premium) surplus reserve
and undistributed profits in that order.
(3) Restricted Stock
Under the equity incentive plan the Company grants restricted shares to eligible participants who are
required to subscribe for the shares upfront. If the participants fail to meet the vesting conditions
specified in the plan the Company will repurchase the shares at a pre-agreed price. When restricted
shares issued to employees have completed the necessary registration and other capital increase
procedures in accordance with applicable regulations the Company recognizes share capital and capital
reserve (share premium) on the grant date based on the subscription proceeds received from
employees. Concurrently the Company recognizes treasury shares and a corresponding liability for the
repurchase obligation.VI.Tax
1.Categories of taxes and tax rate
Categories Taxation basis Tax rate
Output VAT-deductible
Value-added tax 1% 3% 9% 13%
input VAT
Urban maintenance and
Turnover tax 1% 5% 7%
construction tax
Corporate income tax Income tax 15% 17% 25%
Extra charges of education
Turnover tax 3%
funds
Extra charges of local
Turnover tax 2%
education funds
Taxpayer Income tax rate%
Wellhope Foods Co. Ltd. Xi'an Wellhope Feed Technology Company Gansu
Wellhope Animal Husbandry Company Guangzhou Xiangshun Animal
Husbandry Equipment Company Shenyang Fame Bio-tech Company Yangling 15
Wellhope Agriculture and Animal Husbandry Company Yunnan Wellhope Feed
Company Dazhou Wellhope Bio-tech Company
Dalian Huakang Xinxin Food Company Kaifeng Wellhope Meat Food Company
Puyang Wellhope Food Company Dalian Heyuan Animal Husbandry Company
Wafangdian Yifeng Animal Husbandry Company Shandong Heyuan Food
Company Shandong Heyuan Animal Husbandry Company Pingyuan Wellhope
Enterprises engaged
Food Processing Company Fuyu Wellhope Taolaizhao Poultry Breeding
in primary processing
Company Puyang Wellhope Animal Husbandry Company Changchun
of agricultural
Wellhope Food Company Dehui Wellhope Animal Husbandry Company
products livestock
Tongliao Wellhope Tianyi Grass Industry Company Kaifeng Wellhope
and poultry raising
Agriculture and Animal Husbandry Technology Company Shenyang Huakang
businesses are
Meat Poultry Company Tangshan Hejia Agriculture and Animal Husbandry
exempt from levying
Company Shenyang Wellhope Poultry Company Fushun Wellhope Agriculture
corporate income tax
and Animal Husbandry Company Anhui Wellhope Haoxiang Agricultural
Development Company Lixin Xiangfeng Agriculture and Animal Husbandry
Company Lixin Hongfeng Agriculture and Animal Husbandry Company Shulan
Fengtai Agriculture and Animal Husbandry Company Daqing Bifeng Animal
170 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Husbandry Company Hebei Deheng Breeding Company Dalian Hongtu Animal
Husbandry Company Liaoning Wellhope Agriculture and Animal Husbandry
Development Company Luoyang Wellhope Agriculture and Animal Husbandry
Company Gongzhuling Wellhope Pig Breeding Company Lishu Wellhope
Ecological Breeding Company Anyang Wellhope Agriculture and Animal
Husbandry Company Hebei Taihang Wellhope Food Company Nanyang
Jinwan Animal Husbandry Company Daqing Wellhope Food Company
Zhumadian Wellhope Agricultural Development Company Datong Hejia
Agriculture and Animal Husbandry Company Shijiazhuang Hejia Agriculture
and Animal Husbandry Company Fuxin Wellhope Agriculture and Animal
Husbandry Company Dalian Zhongjia Food Company Wafangdian Huinong
Poultry Company Shenyang Wellhope Extruded Feed Company Jilin Wellhope
Breeding Pig Breeding Company Dunhua Fengda Agriculture and Animal
Husbandry Development Company Shenyang Xiaohe Agriculture and Animal
Husbandry Company Shenyang Wellhope Pig Breeding Company Shenyang
Wellhope Agriculture and Animal Husbandry Technology Company Lingyuan
Wellhope Agriculture and Animal Husbandry Company Fuyang Wellhope
Agriculture and Animal Husbandry Technology Company Lanxi Fengyuan
Agriculture and Animal Husbandry Company Kaifeng Jiufeng Agriculture and
Animal Husbandry Company Fuyu Wellhope Egg Poultry Company Anhui
Wellhope Food Company Lixin Rongfeng Agriculture and Animal Husbandry
Company Fuxin Wellhope Agriculture and Animal Husbandry Technology
Company Huairen Dazhuang Breeding Company Suihua Wellhope Animal
Husbandry Company Tailai Wellhope Agriculture and Animal Husbandry
Company Inner Mongolia Xinhaoji Agriculture and Animal Husbandry
Development Company Zhangjiakou Wellhope Agriculture and Animal
Husbandry Company Tangshan Fengnan Heyou Agriculture and Animal
Husbandry Company Hengshui Hechen Agriculture and Animal Husbandry
Company Hengshui Heyou Agriculture and Animal Husbandry Company
Shenze Hezhi Agriculture and Animal Husbandry Company Xinji Heyou
Agriculture and Animal Husbandry Company Hebei New Taihang Wellhope
Animal Husbandry Company Hunan Wellhope Agriculture and Animal
Husbandry Company Shandong Fengkang Food Company Dalian Wellhope Pig
Breeding Company Xingcheng Wellhope Pig Breeding Company Shandong
Jiayixiang Agriculture and Animal Husbandry Technology Company Pingyuan
Wellhope Animal Husbandry Company Liaoning Qingyuan Wellhope
Agriculture and Animal Husbandry Company Tieling Wellhope Animal
Husbandry Company Fushun Hexin Animal Husbandry Company Qingdao
Haifeng Animal Husbandry Company Chifeng Wellhope Fuxinyuan Food
Company Heilongjiang Wellhope Dasenlin Food Company Tieling Wellhope
Food Company
Singapore Golden Harvesta Trade Company 17
Other companies 25
2.Tax preference
(1) Value-Added Tax ("VAT")
In accordance with the provisions of the Circular on Issues Concerning VAT Exemption for Feed
Products (Caishui [2001] No. 121) and other relevant documents the Company and its related
subsidiaries are exempt from VAT on feed sales.Pursuant to the Announcement on Policies for Reducing and Exempting VAT for Small-Scale
Taxpayers (Ministry of Finance and State Taxation Administration [2023] No. 19) small-scale VAT
taxpayers with monthly sales of RMB 100000 or less (inclusive) are exempt from VAT. For taxable sales
171 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
revenue of small-scale VAT taxpayers subject to the 3% levy rate VAT shall be levied at a reduced rate
of 1%; for prepaid VAT items subject to the 3% prepayment rate VAT shall be prepaid at a reduced rate
of 1%. This policy has been extended until December 31 2027.
(2) Income Tax
In accordance with the Notice on Issuing the Scope of Initial Processing of Agricultural Products Eligible
for Enterprise Income Tax Exemption Preferential Policy (Trial) (Caishui [2008] No. 149) issued by the
Ministry of Finance and the State Taxation Administration as well as the Enterprise Income Tax Law of
the People's Republic of China and its Implementation Regulations the Company and its subsidiaries
are exempt from enterprise income tax on income derived from the initial processing of agricultural
products and the breeding of livestock and poultry that qualify for such preferential exemption. The
entities eligible for enterprise income tax exemption are specified in Note VI-1-Main Tax Types andRates: “Taxpayers Subject to Different Enterprise Income Tax Rates and Their Applicable Rates".Guangzhou Xiangshun Animal Husbandry Equipment Company a subsidiary of the Company has been
jointly recognized as a high-tech enterprise by the Guangdong Provincial Department of Science and
Technology Guangdong Provincial Department of Finance and State Taxation Administration
Guangdong Provincial Taxation Bureau (Certificate No. GR202344006108). It is subject to a preferential
enterprise income tax rate of 15% with validity from December 2023 to December 2026. During the
reporting period Guangzhou Xiangshun Animal Husbandry Equipment Company applied the 15%
enterprise income tax rate.Pursuant to the Notice of the General Office of the State Council on Forwarding the Implementation
Opinions on Several Policy Measures for Western Development (Guobanfa [2001] No. 73) the Notice on
Implementing Preferential Tax Policies for Western Development (Caishui [2001] No. 202) and
the Specific Implementation Opinions on Implementing Tax Policies for Western Development (Guoshui
Fa [2002] No. 47) Xi'an Wellhope Feed Technology Company Gansu Wellhope Animal Husbandry
Company Yangling Wellhope Agriculture and Animal Husbandry Company Yunnan Wellhope Feed
Company and Dazhou Wellhope Bio-tech Company are eligible for a preferential enterprise income tax
rate of 15%.On November 4 2022 Shenyang Fame Bio-Tech Company a subsidiary of the Company was jointly
recognized as a high-tech enterprise by the Liaoning Provincial Department of Science and Technology
Liaoning Provincial Department of Finance and State Taxation Administration Liaoning Provincial
Taxation Bureau (Certificate No. GR202221000172). It is subject to a 15% enterprise income tax rate
with a three-year validity period.The Company itself has been jointly recognized as a high-tech enterprise by the Liaoning Provincial
Department of Science and Technology Liaoning Provincial Department of Finance and State Taxation
Administration Liaoning Provincial Taxation Bureau (Certificate No. GR202321001872). It is subject to a
172 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
15% enterprise income tax rate with validity from 2023 to 2025.
Pursuant to the Announcement on Further Implementing Preferential Enterprise Income Tax Policies for
Small and Micro Profit-Making Enterprises (Caishui [2022] No. 13) for small and micro profit-making
enterprises the portion of annual taxable income exceeding RMB 1 million but not exceeding RMB 3
million shall be included in taxable income at a reduced rate of 25% and subject to enterprise income
tax at a 20% rate. Pursuant to the Announcement on Further Supporting the Development of Small and
Micro-Enterprises and Individual Businesses with Relevant Tax Policies (Caishui [2023] No. 12) for small
and micro profit-making enterprises annual taxable income not exceeding RMB 3 million shall be
included in taxable income at a reduced rate of 25% and subject to enterprise income tax at a 20% rate.This policy has been extended until December 31 2027.Pursuant to the Announcement on Further Improving the Policy for Additional Pre-Tax Deduction of
Research and Development Expenses (Caishui [2023] No. 7) for research and development expenses
actually incurred by enterprises in research activities: where such expenses do not form intangible
assets and are included in current profits and losses in addition to the deduction of the actual amount
in accordance with regulations an additional 100% of the actual amount shall be allowed as a pre-tax
deduction starting from January 1 2023; where such expenses form intangible assets the intangible
assets shall be amortized at 200% of their cost for pre-tax purposes starting from January 1 2023.VII.Notes to the Items of Consolidated Financial Statements
1.Cash at bank
RMB
Item Closing balance Opening balance
Cash on hand 339635.02 202957.16
Cash deposit 1748152242.58 1894831603.48
Other monetary funds 45743263.42 20344238.13
Total 1794235141.02 1915378798.77
including: Total funds deposited
2252445.033051960.87
overseas
Other explanation:
At the end of the period other monetary funds included RMB 5106257.99 as margin for letters of
credit RMB 19700245.12 as margin for futures transactions and RMB 20936760.31 as funds in
securities accounts.
2.Trading financial assets
RMB
Item Closing balance Opening balance
Financial assets measured at fair value and the changes
904884.08829591.32
recorded in current profits and losses
including
Others 904884.08 829591.32
Total 904884.08 829591.32
Other explanation:
173 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
The “Others” category refers to listed equity securities acquired through debt-for-equity swaps.
3.Derivative financial assets
RMB
Item Closing balance Opening balance
Futures 2441832.40 4296668.60
Total 2441832.40 4296668.60
4.Notes receivable
A. Classification
RMB
Item Closing balance Opening balance
Bank acceptance bill 1369195.29 6620586.95
Commercial acceptance bill 26524182.60
Total 27893377.89 6620586.95
174 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B. Categorized by method of bad debt provision
RMB
Closing balance Opening balance
Category Book balance Bad debt provision Book balance Bad debt provision
Book value Book value
Amount Percentage % Amount Provision rate % Amount Percentage % Amount Provision rate %
Provision for bad debts on an individual
basis
Provision for bad debts on a collective
28462630.50100.00569252.612.0027893377.896620586.95100.006620586.95
basis
grouped as follows:
Group 1: Commercial acceptance bills 27065492.45 95.09 5 41309.85 2.00 26524182.60
Group 2: Bank acceptance bills 1397138.05 4.91 27942.76 2.00 1369195.29 6620586.95 100.00 6620586.95
Total 28462630.50 / 569252.61 / 27893377.89 6620586.95 / / 6620586.95
175 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Provision for bad debts on a collective basis:
Group 1: Commercial acceptance bills
RMB
Closing balance
Item
Notes receivable Bad debt provision Provision rate %
Commercial acceptance bills 27065492.45 541309.85 2.00
Total 27065492.45 541309.85 2.00
Group 2: Bank acceptance bills
RMB
Closing balance
Item
Notes receivable Bad debt provision Provision rate %
Bank acceptance bills 1397138.05 27942.76 2.00
Total 1397138.05 27942.76 2.00
C.Bad debt provision
RMB
Fluctuations in 2024
Opening Closing
Category Other
balance Provision Reversal Write-off balance
fluctuations
Commercial
acceptance 541309.85 541309.85
bills
Bank
acceptance 27942.76 27942.76
bills
Total 569252.61 569252.61
5.Accounts receivable
A.Categorized by aging
RMB
Aging Closing book balance Opening book balance
Within 1 year 841743338.66 1068503974.72
1-2 years 124582704.37 74841466.32
2-3 years 47670563.50 35466407.80
Over 3 years 118938308.96 109873833.23
Total 1132934915.49 1288685682.07
176 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B.Categorized by the method of bad debt provision
RMB
Closing balance Opening balance
Category Book balance Bad debt provision Book balance Bad debt provision
Book value Book value
Amount Percentage % Amount Provision rate % Amount Percentage % Amount Provision rate %
Provision for bad
debts on an individual 92664981.83 8.18 92664981.83 100.00 21864441.90 1.70 21864441.90 100.00
basis
Provision for bad
debts on a collective 1040269933.66 91.82 147115047.90 14.14 893154885.76 1266821240.17 98.30 152334846.16 12.02 1114486394.01
basis
including
Aging analysis group 1040269933.66 91.82 147115047.90 14.14 893154885.76 1266821240.17 98.30 152334846.16 12.02 1114486394.01
Total 1132934915.49 / 239780029.73 / 893154885.76 1288685682.07 / 174199288.06 / 1114486394.01
177 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Provision for bad debts on an individual basis:
RMB
Closing balance
Name
Book balance Bad debt provision Provision rate % Reason
Customer 1 25112815.51 25112815.51 100.00 Uncollectible
Customer 2 19350023.78 19350023.78 100.00 Uncollectible
Customer 3 14768684.40 14768684.40 100.00 Uncollectible
Customer 4 8461300.00 8461300.00 100.00 Uncollectible
Other individually
assessed 24972158.14 24972158.14 100.00 Uncollectible
customers
Total 92664981.83 92664981.83 100.00 /
Provision for bad debts on a collective basis-Aging :
RMB
Closing balance
Aging
Account receivable Bad debt provision Provision rate %
Within 1 year 833705602.36 29305717.31 3.52
1-2 years 94212136.60 14131820.49 15.00
2-3 years 17349369.21 8674684.61 50.00
Over 3 years 95002825.49 95002825.49 100.00
Total 1040269933.66 147115047.90 14.14
C.Bad debt provision
RMB
Fluctuations in 2024
Opening
Category Recovery or Other Closing balance
balance Provision Write-off
reversal fluctuations
Provision for
bad debts on
21864441.9078140077.85112620.507226917.4292664981.83
an individual
basis
Provision for
bad debts on a 152334846.16 12070519.16 19918962.32 2628644.90 147115047.90
collective basis
Total 174199288.06 90210597.01 112620.50 27145879.74 2628644.90 239780029.73
D.Accounts receivables written off in the current period
RMB
Item Write-off amount
Actual write-off of accounts receivable 27145879.74
Significant write-off of accounts receivable:
RMB
Written off Whether generated by
Name Nature Reason
amount related party transactions
Payment for
Customer 5
products 7053335.00
Uncollectible No
Payment for
Customer 6
products 2348413.70
Uncollectible No
Payment for
Customer 7
products 1949337.50
Uncollectible No
Payment for
Customer 8
products 1617615.00
Uncollectible No
178 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Payment for
Customer 9
products 1047792.88
Uncollectible No
Total / 14016494.08 / /
E.Top 5 accounts receivable and contract assets at the end of the reporting period
RMB
Percentage of total
Closing balance of Closing balance of
Closing balance of accounts receivable Closing balance of
Debtor accounts accounts receivable
contract assets and contract assets bad debt provision
receivable and contract assets
at period-end %
145185071.8945185071.893.994518507.19
226900000.0026900000.002.37538000.00
325112815.5125112815.512.2225112815.51
422780793.0022780793.002.01455615.86
521447578.3621447578.361.89428951.57
Total 141426258.76 141426258.76 12.48 31053890.13
6.Contract assets
A.Information of contact assets
RMB
Closing balance Opening balance
Item
Book Provision for Book Provision for
Book value Book value
balance bad debt balance bad debt
Retention
money
641840.0013126.80628713.202482367.5049647.352432720.15
not yet
due
Total 641840.00 13126.80 628713.20 2482367.50 49647.35 2432720.15
179 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B.Categorized by bad debt provision method
RMB
Closing balance Opening balance
Category Book balance Bad debt provision Book balance Bad debt provision
Book value Book value
Amount Percentage % Amount Provision rate % Amount Percentage % Amount Provision rate %
Provision for bad debts on an individual basis
Provision for bad debts on a collective basis 641840.00 100.00 13126.80 2.00 628713.20 2482367.50 100.00 49647.35 2.00 2432720.15
including
Aging analysis group 641840.00 100.00 13126.80 2.00 628713.20 2482367.50 100.00 49647.35 2.00 2432720.15
Total 641840.00 / 13126.80 / 628713.20 2482367.50 / 49647.35 / 2432720.15
180 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Provision for bad debts on a collective basis:
RMB
Closing balance
Item
Contractual assets Bad debt provision Provision rate %
Retention money
641840.0013126.802.00
not yet due
Total 641840.00 13126.80 2.00
C.Provision for bad debts on contract assets during the period
RMB
Amount of
Item Opening balance provision made Closing balance Reason
during the period
Retention
money not 49647.35 -36520.55 13126.80
yet due
Total 49647.35 -36520.55 13126.80 /
7.Accounts receivable financing
A. Classification
RMB
Item Closing balance Opening balance
Notes receivable 9139184.14
Total 9139184.14
B. Accounts receivable financing that had been endorsed or discounted but not yet matured as at the
balance sheet date
RMB
Amount derecognized at
Item Amount not derecognized
period-end
Bank acceptance bills 1746875.00
Total 1746875.00
8.Prepayments
A.Presenting by aging
RMB
Closing balance Opening balance
Aging
Amount Percentage % Amount Percentage %
Within 1 year 259488864.09 98.89 464654321.65 98.89
Over 1 year 2906634.61 1.11 5202681.86 1.11
Total 262395498.70 100.00 469857003.51 100.00
B.Top 5 prepayments at the end of the reporting period
RMB
Percentage of the closing balance
Company Closing balance
of prepayments %
17255439.102.77
181 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
26922436.252.64
36588686.202.51
46147688.472.34
55615208.262.14
Total 32529458.28 12.40
9.Other receivables
RMB
Item Closing balance Opening balance
Interest receivable
Dividends receivable
Other receivables 69263268.24 92732094.80
Total 69263268.24 92732094.80
Other receivables
A.Presenting by aging
RMB
Aging Closing book balance Opening book balance
Within 1 year 53446126.87 92235945.08
1-2 years 37383595.16 6461849.91
2-3 years 6235298.82 2239316.81
Over 3 years 17283478.23 16035831.47
Total 114348499.08 116972943.27
B.Presenting by nature
RMB
Nature Closing book balance Opening book balance
General operating receivables 53681551.93 30370169.36
Deposits and margins 18871947.15 42957773.91
Receivables from disposal of investments 37445000.00 39295000.00
Other 4350000.00 4350000.00
Total 114348499.08 116972943.27
C.Bad debt provision
RMB
Stage 1 Stage 2 Stage 3
Bad debt provision 12-month Lifetime expected Lifetime expected credit Total
expected credit credit loss (not
loss (credit-impaired)
loss credit-impaired)
Balance on January 1 2024 8430971.67 15809876.80 24240848.47
-Transfer to stage 2
- Transfer to stage 3 -560273.39 560273.39
-Transfer back to stage 2
- Transfer back to stage 1
Provision made during the
2107866.9524068348.6126176215.56
reporting period
Reversal 1175396.25 1175396.25
Charged-off during the
reporting period
182 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Write-off during the reporting
535065.963646451.444181517.40
period
Other fluctuations 25080.46 25080.46
Closing balance on December
9468579.7335616651.1145085230.84
312024
Basis for stage classification and provision rates for expected credit losses
a. As of December 31 2024 the provision for bad debts was measured based on the three-stage model
as follows:
RMB
Stage Book balance Provision for bad debts Book value
Stage 1 77402593.47 9468579.73 67934013.74
Stage 2
Stage 3 36945905.61 35616651.11 1329254.50
Total 114348499.08 45085230.84 69263268.24
b. As of December 31 2023 the provision for bad debts was measured based on the three-stage model
as follows:
RMB
Stage Book balance Provision for bad debts Book value
Stage 1 101163066.47 8430971.67 92732094.80
Stage 2
Stage 3 15809876.80 15809876.80
Total 116972943.27 24240848.47 92732094.80
D.Bad debt provision
RMB
Fluctuations in 2024
Opening Closing
Category Other
balance Provision Reversal Write-off balance
fluctuations
Other
24240848.4726176215.561175396.254181517.4025080.4645085230.84
receivables
Total 24240848.47 26176215.56 1175396.25 4181517.40 25080.46 45085230.84
E.Write-off of other receivables during the period
RMB
Item Amount written off
Other receivables written off 4181517.40
Write-off of significant other receivables during the period
Written off Whether generated by
Name Nature Reason
amount related party transactions
Advances
1 and 2014874.40 Unrecoverable No
settlements
Total / 2014874.40 / /
183 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
F.Top 5 other receivables at the end of the reporting period
RMB
Percentage of
closing balance Closing balance of bad
Company Closing balance Nature Aging
of other debt provision
receivables %
Equity transfer
1 33400000.00 29.21 1-2 years 5010000.00
consideration
Operating Less than 1
211508472.6410.0611508472.64
receivables year
3 4350000.00 3.80 Others Over 3 years 4350000.00
Operating Less than 1
43246750.002.841946750.00
receivables year
Less than 1
5 2600000.00 2.27 Deposit 52000.00
year
Total 55105222.64 48.18 / / 22867222.64
10.Inventory
A. Category of inventory
RMB
Closing balance Opening balance
Provision for inventory Provision for inventory
Item write-down/impairment write-down/impairment
Book balance Book value Book balance Book value
of contract of contract
performance costs performance costs
Raw
1030538644.882747387.501027791257.38899627530.69613737.64899013793.05
materials
Work in
64061979.284851516.0259210463.2664101323.0164101323.01
progress
Finished
794286722.5325678770.76768607951.77915053061.2433437376.01881615685.23
goods
Consumable
biological 912612731.35 17300534.64 895312196.71 830749973.43 42645221.93 788104751.50
assets
Low-value
37970752.2837970752.2833924805.0933924805.09
consumables
Packaging 20146801.19 20146801.19 19994892.00 19994892.00
Total 2859617631.51 50578208.92 2809039422.59 2763451585.46 76696335.58 2686755249.88
B. Provision for inventory write-down/impairment of contract performance costs
RMB
Added amount Deducted amount
Item Opening balance Reversal or Closing balance
Provision Other
write-off
Raw materials 613737.64 2986131.54 852481.68 2747387.50
Work in progress 4853447.82 1931.80 4851516.02
Finished goods 33437376.01 32779133.01 338426.45 40876164.71 25678770.76
Consumable biological
42645221.9316498531.4341843218.7217300534.64
assets
Total 76696335.58 57117243.80 338426.45 83573796.91 50578208.92
184 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
11.Other current assets
RMB
Item Closing balance Opening balance
Reclassification of input VAT balance 143400061.96 124309514.95
Other 1552097.09 5127421.43
Total 144952159.05 129436936.38
185 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
12.Long-term equity investment
RMB
Fluctuations in the current period
Share of profit Adjustment of Impairment
Dividends or
Investee Opening balance Additional Reduction of or loss under other Other equity Closing balance provision at
profit Other
investments investment the equity comprehensive changes period-end
declared
method income
1.Joint Venture
Unphung Joint Venture Company 4167616.44 4167616.44
Nepal Wellhope Agri-tech Pvt. Ltd. 7501575.10 7501575.10
Nexus Well-Hope Agritech International
17900000.0017900000.0017900000.00
Limited
Subtotal 29569191.54 29569191.54 17900000.00
2.Associated Company
Beipiao Hongfa Food Company 577420717.85 32341043.78 5390000.00 604371761.63
Dalian Chengsan Food Group Company 335590076.13 39747509.78 5000000.00 370337585.91
Anshan Jiuguhe Food Company 229218949.11 17216866.04 246435815.15
Golden Harvesta Inc. 118725880.04 27135877.85 -1533053.64 144328704.25
Dandong Wellhope Chengsan Animal
110101992.6511142207.26121244199.91
Husbandry Company
Dandong Wellhope Chengsan Food
101348309.018491052.32109839361.33
Company
Jinzhou Jiufeng Food Company 98214303.40 10452169.84 108666473.24
Tai’an Fengjiu Animal Husbandry
61361547.749500000.0015027004.66760000.0085128552.40
Company
PT Mulia Harvest Agritech 61235381.67 4473546.46 -736758.26 64972169.87
Gongzhuling Wellhope Corn Purchasing
52862080.60993632.2253855712.82
and Storage Company
Anshan Fengsheng Food Company 55295625.46 -5452690.37 49842935.09
Dalian Sidafa Food Company 45570725.69 720564.63 46291290.32
Huludao Jiuguhe Food Company 34887946.48 -8085188.62 26802757.86
Linghai Jiuguhe Feed Company 40037876.72 3420000.00 -5824765.63 37633111.09
Lankao Tiandi Duck Industry Company 30267279.37 6089245.12 36356524.49
Hebei Taihang Wellhope Animal
33027074.95900000.001296150.0133423224.96
Husbandry Company
PT Sekar Golden Harvesta Indonesia 34125322.42 -1191701.47 -537185.31 32396435.64
Harbin Wei'erhao Trade Company 14174967.30 7803000.00 2251618.13 24229585.43
Beijing Dahong Hengfeng Animal
23768257.00373448.8124141705.81
Husbandry Technology Company
186 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Dalian Wellhope Fishmeal Company 12774842.36 4045613.31 7186056.72 24006512.39
Dalian Minglu Agricultural Development
24500000.00-2744527.9421755472.06
Company
Jilin Jinfeng Animal Husbandry
4496784.489000000.004202965.1317699749.61
Company
Tai’an Jiuguhe Agricultural Development
26553370.2115249951.00-24761732.8817041588.33
Company
Shenyang Zhongwenjie Bio-technology
10358475.964852423.2615210899.22
Company
Liaoning Mubang Animal Husbandry
12230028.52561003.1712791031.69
Equipment Manufacturing Company
Qingdao Shenfeng Animal Husbandry
12368636.02-10742.2912357893.73
Company
Jinzhou Xinfeng Food Company 11164938.36 715929.06 11880867.42
Chongqing Kuizhou Rabbit Industry
7544722.253500000.00550521.1611595243.41
Company
Chongqing Dahong Agricultural and
14393314.92-3386293.2911007021.63
Animal Husbandry Machinery Company
Jiyuan Sunshine Rabbit Industry
12509492.01-2553290.649956201.37
Technology Company
Liaoning Yufeng Bio-technology
16280236.96-6735576.949544660.02
Company
Jilin Hengfeng Animal Health Products
8017708.751430062.309447771.05
Company
Shenyang Wanlitian Agriculture and
10346139.831177015.752600000.008923155.58
Animal Husbandry Company
Anshan Jiuguhe Paper Packaging
5636125.211824000.00850956.458311081.66
Company
Dunhua Fengda Breeding Poultry
5643687.462293469.947937157.40
Company
Weifang Wellhope Xinhesheng Feed
6260794.8386903.656347698.48
Company
Liaoning Petmate Bio-technology
6539804.40-963193.435576610.97
Company
Suizhong Renhe Fishery Company 3866741.77 46963.80 933259.23 4846964.80
Anshan Antai Plastic Products Company 4256064.48 552006.14 4808070.62
Daqing Supply and Marketing Wellhope
4901990.85-725168.994176821.86571733.76
Animal Husbandry Company
Indonesia Godaji International Trade
2368362.16501198.73-33449.663023.122839134.35
Company
Huludao Jiuguhe Feed Company 1072437.29 1382111.99 2454549.28
Shihaipu (Beijing) Commerce and Trade
2195480.34205853.772401334.11
Company
187 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Shenyang Yihe Enterprise Management
1854886.06-55.651854830.41
Partnership (Limited Partnership)
Shulan Fengtai Organic Fertilizer
1661310.19-134630.631526679.56
Company
Indonesia Max Animal Husbandry
1479055.560.0013318.201492373.76
Technology Company
Liaoning Xinjuntong Logistics
1140000.00219145.081359145.08
Technology Company
Fuyu Fengyuan Poultry and Egg
1250000.008259.961258259.96
Company
Hainan Nongken Wenfeng Wenchang
1089591.10-172387.50917203.60
Chicken Industry (Group) Company
Wudalianchi Zhongwang Dairy Cattle
Breeding Farmers Professional 764945.13 764945.13
Cooperative
Hebei Taihang Wellhope Feed Company 900000.00 -175475.54 724524.46
Shenyang Wellhope Huahu Food
188882.09-76078.44112803.65
Technology Company
Huludao Jiuguhe Animal Husbandry
2456236.03-2456236.03
Company
Taian Jiufeng Animal Husbandry
Company
Shandong Fengkang Food Company
Dazhou Wellhope Bio-technology
14143883.56-1626026.352625000.00-15142857.21
Company
Shenyang Wenjie Bio-technology
13934675.2412000000.00-96285.041838390.20
Company
Wudalianchi Shengda Pasture
11134388.17-11134388.17
Professional Cooperative
Tai’an Huijun Biomass Energy Company 509726.28 -509726.28
Subtotal 2304365330.65 85999306.08 12900000.00 125758620.85 -2827128.67 2628023.12 15588390.20 -14209597.98 2473226163.85 571733.76
Total 2333934522.19 85999306.08 12900000.00 125758620.85 -2827128.67 2628023.12 15588390.20 -14209597.98 2502795355.39 18471733.76
1.In view of the specific market and regulatory conditions in the countries where Unphung Joint Venture Company Nepal Wellhope Agri-tech Pvt. Ltd. and Nexus Well-Hope Agritech
International Limited are located as well as the limited extent to which the Company is able to exercise significant influence over them investments in the above three entities are accounted
for using the cost method.
2.As of the end of the reporting period the net assets of Tai’an Huijun Biomass Energy Company amounted to RMB -10940385.63. The book value of the long-term equity investment has
been written down to zero and the unrecognized investment loss at period-end was RMB -2545827.73.
188 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
13.Other equity instruments Investment
RMB
Fluctuations in the current period Dividend Cumulative gain Cumulative loss
Other Other income recognized in recognized in
Opening Closing
Item Additional Reduction of comprehensive comprehensive recognized other other
balance Other balance
investments investment income – gain income – loss during the comprehensive comprehensive
for the period for the period period income income
Liaoning
China-Russia
10000.0010000.00-10000.00
Friendship
Association
Xi'an Micro
Monkey
-340000.00
E-commerce
Company
Dalian Chengsan
Xuelong Wagyu
4096952.574096952.57-15000000.00
Food Processing
Company
Henan Shanghui
Feed
164776.381053.60163722.78-336277.22
Development
Company
Mudanjiang
Wanding Dairy 10554982.04 10554982.04 -9022830.49
Company
Total 14826710.99 14662988.21 163722.78 -24709107.71
189 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
14. Investment properties
Investment properties accounted for using cost model
RMB
Buildings and
Item Land use rights Total
structures
1. Original value
A. Opening balance
B. Increased amount 26701973.69 12899279.82 39601253.51
a. Purchased
b. Reclassification from fixed assets or
26701973.6912899279.8239601253.51
intangible assets
c. Increased by business combination
C. Decreased amount
D. Closing balance 26701973.69 12899279.82 39601253.51
2. Accumulated depreciation /
amortization
A. Opening balance
B. Increased amount 12305995.33 3314338.50 15620333.83
a. Reclassification from fixed assets or
11094266.593056352.9014150619.49
intangible assets
b. Provision or amortization 1211728.74 257985.60 1469714.34
C. Decreased amount
D. Closing balance 12305995.33 3314338.50 15620333.83
3. Impairment provision
A. Opening balance
B. Increased amount
a. Provision
C. Decreased amount
a. Disposed or retired
D. Closing balance
4. Book value
A. Closing book value 14395978.36 9584941.32 23980919.68
B. Opening book value
15.Fixed assets
RMB
Item Closing balance Opening balance
Fixed assets 4307643182.96 4168026657.86
Disposal of fixed assets
Total 4307643182.96 4168026657.86
A.Circumstance of fixed assets
RMB
Buildings and Machinery and Transportation Other
Item Total
structures equipment vehicle equipment
1. Original value
A. Opening balance 3611104431.11 2514063900.91 142169762.83 160457072.89 6427795167.74
B. Increased amount 360500201.41 265581342.97 7087038.79 14214305.19 647382888.36
190 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
a. Purchased 54836135.76 81957719.66 6112628.45 11679834.32 154586318.19
b. Transferred from
161425323.0489924185.53443871.22251793379.79
construction in progress
c. Increased by business
144238742.6193699437.78974410.342090599.65241003190.38
combination
C. Decreased amount 52751147.70 74612125.28 18319745.51 20061339.18 165744357.67
a. Disposal or retirement 18426418.01 64067966.92 16876588.82 19934177.34 119305151.09
b. Disposal of subsidiaries 7622756.00 10544158.36 1443156.69 127161.84 19737232.89
c. Other 26701973.69 26701973.69
D. Closing balance 3918853484.82 2705033118.60 130937056.11 154610038.90 6909433698.43
2. Accumulated
depreciation
A. Opening balance 862327919.82 1117845075.70 107138576.49 100129568.55 2187441140.56
B. Increased amount 177662286.57 233627265.14 17030092.53 19224087.58 447543731.82
a. Provision 158608988.99 211557550.38 16457878.45 17983417.35 404607835.17
b. Increased by business
19053297.5822069714.76572214.081240670.2342935896.65
combination
C. Decreased amount 20242195.69 47157733.24 16908006.14 19038053.08 103345988.15
a. Disposal or retirement 7235644.18 41690486.70 16109338.29 18651269.59 83686738.76
b. Disposal of subsidiaries 700556.18 5467246.54 798667.85 386783.49 7353254.06
c. Other 12305995.33 12305995.33
D. Closing balance 1019748010.70 1304314607.60 107260662.88 100315603.05 2531638884.23
3. Impairment provision
A. Opening balance 40320761.32 31307742.23 91498.28 607367.49 72327369.32
B. Increased amount 126157.75 937396.36 15940.16 1411.98 1080906.25
a. Provision 126157.75 937396.36 15940.16 1411.98 1080906.25
C. Decreased amount 308271.15 2934635.44 879.00 12858.74 3256644.33
a. Disposal or retirement 308271.15 2934635.44 879.00 12858.74 3256644.33
D. Closing balance 40138647.92 29310503.15 106559.44 595920.73 70151631.24
4. Book value
A. Closing book value 2858966826.20 1371408007.85 23569833.79 53698515.12 4307643182.96
B. Opening book value 2708455749.97 1364911082.98 34939688.06 59720136.85 4168026657.86
B.Status of fixed assets pending ownership certification
Reason for not obtaining
Item Book value
ownership certificate
Operations center and raw material
15318916.78 In process
warehouse
Total 15318916.78 /
16.Construction in progress
RMB
Item Closing balance Opening balance
Construction in progress 189068183.70 158377935.65
Engineering material
Total 189068183.70 158377935.65
191 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
A.Circumstance of construction in progress
RMB
Closing balance Opening balance
Item
Book balance Book value Book balance Book value
Dalian Zhongjia - Phase II Chicken
8489311.958489311.958286191.628286191.62
Processing and Slaughtering Project
Changchun Wellhope Food - Factory Area
54455.4554455.45
Transformation Project
Hainan Wellhope - 200000 Tons Feed
1331909.701331909.702658725.442658725.44
Production Line Project
Baotou Hechen - 150000 Tons Feed
51269819.5051269819.50
Production Line Project
Haicheng Wellhope - Phase II Factory
7353647.367353647.36
Construction Project
Fuzhou Wellhope - 200000 Tons Feed
894389.04894389.04
Production Line Project
Fushun Agriculture and Animal Husbandry
3753480.003753480.00
- Pig Farm Construction
Heilongjiang Wellhope - Creep and
4557981.004557981.004557981.004557981.00
Nursery Feed Workshop
Shandong Heyuan - Water Reservoir
9798025.369798025.369798025.369798025.36
Renovation
Pingyuan Wellhope - Cold Storage Project 1526890.49 1526890.49 44377073.84 44377073.84
Lingyuan Wellhope - Pig Farm
630800.00630800.00
Construction
Tieling Wellhope Food - Annual Slaughter
of 50 Million White Feather Broilers 65808853.00 65808853.00
Renovation Project
Siping Wellhope Food - Phase I of the
80-million Broiler Slaughtering and
3947909.863947909.86
Further Processing Project in Shuangliao
City
Liaoning Qingyuan -The Fifth Pelleting
Line and Bulk Grain Storage System 6387071.04 6387071.04
Project
Dasenlin Food - Workshop Expansion 4427782.48 4427782.48 330194.18 330194.18
Shenyang Wellhope Agriculture and
Animal Husbandry Technology Company-
21166842.8021166842.801018118.241018118.24
Beef Cattle Breeding Innovation Capacity
Enhancement Project
Dazhou Wellhope - Biological Food
17063531.3317063531.338009077.368009077.36
Processing Project (Phase II)
Other Construction Projects 44562074.69 44562074.69 15385957.26 15385957.26
Total 189068183.70 189068183.70 158377935.65 158377935.65
192 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B.Changes of important constructions in progress
RMB
Of which:
Cumulative Cumulative Interest
interest
Increased Amount transferred investment as Construction amount of capitalization Source of
Project Budget Opening balance Closing balance capitalized
amount to fixed assets a percentage progress % capitalized rate during funds
during the
of budget % interest the period %
period
Dalian Zhongjia - Phase II
Chicken Processing and 250000000.00 8286191.62 2925242.41 2722122.08 8489311.95 20.00 13.50 Self-funded
Slaughtering Project
Changchun Wellhope Food
- Factory Area 97300000.00 54455.45 54455.45 100.00 100.00 Self-funded
Transformation Project
Hainan Wellhope - 200000
Tons Feed Production Line 72000000.00 2658725.44 1333409.70 2660225.44 1331909.70 98.00 98.00 Self-funded
Project
Baotou Hochen - 150000
Tons Feed Production Line 60000000.00 51269819.50 4406687.06 55676506.56 92.79 100.00 Self-funded
Project
Haicheng Wellhope -
Self-funded
Phase II Factory 73500000.00 7353647.36 49182690.43 56536337.79 76.92 100.00 875970.98 858407.43 3.41
Construction Project loans
Fuzhou Wellhope -
200000 Tons Feed 80000000.00 894389.04 7972565.14 8866954.18 100.00 100.00 Self-funded
Production Line Project
Fushun Agriculture and
Animal Husbandry - Pig 380300000.00 3753480.00 4141500.00 7894980.00 100.00 100.00 Self-funded
Farm Construction
Heilongjiang Wellhope - Self-funded
Creep and Nursery Feed 50000000.00 4557981.00 4557981.00 34.00 15.00 public
Workshop financing
Shandong Heyuan - Water
15000000.00 9798025.36 9798025.36 65.32 66.00 Self-funded
Reservoir Renovation
Pingyuan Wellhope - Cold
95000000.00 44377073.84 21121245.95 63971429.30 1526890.49 100.00 98.20 Self-funded
Storage Project
Self-funded
Lingyuan Wellhope - Pig
85000000.00 630800.00 630800.00 100.00 100.00 public
Farm Construction
financing
Tieling Wellhope Food -
Annual Slaughter of 50
Million White Feather 120000000.00 65808853.00 65808853.00 54.84 54.84 Self-funded
Broilers Renovation
Project
193 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Siping Wellhope Food -
Phase I of the 80-million
Broiler Slaughtering and 120000000.00 3947909.86 3947909.86 3.29 3.29 Self-funded
Further Processing Project
in Shuangliao City
Liaoning Qingyuan -The
Fifth Pelleting Line and
13000000.00 7061794.04 674723.00 6387071.04 54.32 54.32 Self-funded
Bulk Grain Storage System
Project
Dasenlin Food - Workshop
10500000.00 330194.18 4097588.30 4427782.48 42.17 42.17 Self-funded
Expansion
Shenyang Wellhope
Agriculture and Animal
Husbandry Technology
Company - Beef Cattle 30000000.00 1018118.24 20148724.56 21166842.80 70.56 95.00 Self-funded
Breeding Innovation
Capacity Enhancement
Project
Dazhou Wellhope -
Biological Food Processing 61214100.00 8009077.36 9054453.97 17063531.33 27.88 27.88 Self-funded
Project (Phase II)
Total 1612814100.00 142991978.39 201202664.42 199688533.80 144506109.01 / / 875970.98 858407.43 / /
194 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
17.Productive biological asset
Productive biological assets measured at cost
RMB
Livestock industry
Item Total
Broiler breeder Pig breeder Layer Cow breeder
1. Original value
A. Opening balance 64899903.46 148636775.79 28043023.36 5059778.99 246639481.60
B. Increased amount 104046000.89 337727286.72 16271698.87 2445163.30 460490149.78
a. Externally purchased 48198841.08 109385780.10 8075993.41 2445163.30 168105777.89
b. Breeding by own farm 55847159.81 228341506.62 8195705.46 292384371.89
C. Decreased amount 66033157.25 341186002.32 28360200.78 3171402.27 438750762.62
a. Disposed 66033157.25 249906191.70 7208833.75 225452.90 323373635.60
b.Transferred to consumable biological assets 91279810.62 21151367.03 2945949.37 115377127.02
D. Closing balance 102912747.10 145178060.19 15954521.45 4333540.02 268378868.76
2. Accumulated depreciation
A. Opening balance 18480428.20 22308146.30 5737759.52 336610.69 46862944.71
B. Increased amount 56280796.00 53827685.78 8620569.89 232737.84 118961789.51
a. Provision 56280796.00 53827685.78 8620569.89 232737.84 118961789.51
C. Decreased amount 51784458.51 51063001.81 10788064.15 165251.59 113800776.06
a. Disposed 51784458.51 35996352.10 2524766.18 27773.96 90333350.75
b.Others 15066649.71 8263297.97 137477.63 23467425.31
D. Closing balance 22976765.69 25072830.27 3570265.26 404096.94 52023958.16
3. Impairment provision
4. Book value
A. Closing book value 79935981.41 120105229.92 12384256.19 3929443.08 216354910.60
B. Opening book value 46419475.26 126328629.49 22305263.84 4723168.30 199776536.89
195 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
18.Right-of-use asset
RMB
Buildings and Machinery
Item Land Total
structures equipment
1. Original value
A. Opening balance 449987922.21 99958189.70 87273835.31 637219947.22
B. Increased amount 116598082.68 2576314.51 1216041.63 120390438.82
a. New lease 116598082.68 2576314.51 1216041.63 120390438.82
C. Decreased amount 20045161.79 15442475.89 35487637.68
a. Lease expiration 20045161.79 15442475.89 35487637.68
D. Closing balance 546540843.10 87092028.32 88489876.94 722122748.36
2. Accumulated
amortization
A. Opening balance 69744483.68 14965520.80 27318759.35 112028763.83
B. Increased amount 58420604.43 5210504.78 8868994.55 72500103.76
a. Provision 58420604.43 5210504.78 8868994.55 72500103.76
C. Decreased amount 7288591.26 2611427.51 9900018.77
a. Disposed 7288591.26 2611427.51 9900018.77
D. Closing balance 120876496.85 17564598.07 36187753.90 174628848.82
3. Impairment
provision
4. Book value
A. Closing book value 425664346.25 69527430.25 52302123.04 547493899.54
B. Opening book
value 380243438.53 84992668.90 59955075.96 525191183.39
19.Intangible assets
RMB
Computer software
Item Land use rights Total
and other
1. Original value
A. Opening balance 434249996.69 20442192.38 454692189.07
B. Increased amount 46610245.99 10635772.24 57246018.23
a. Purchased 10168593.09 10635772.24 20804365.33
b. Increased by business
36441652.9036441652.90
combination
C. Decreased amount 15249995.62 219705.69 15469701.31
a. Disposed 15249995.62 219705.69 15469701.31
D. Closing balance 465610247.06 30858258.93 496468505.99
2. Accumulated
amortization
A. Opening balance 79433011.85 11728402.58 91161414.43
B. Increased amount 14017932.09 2289739.33 16307671.42
a. Provision 14017932.09 2289739.33 16307671.42
C. Decreased amount 4033638.87 212764.30 4246403.17
a. Disposed 4033638.87 212764.30 4246403.17
D. Closing balance 89417305.07 13805377.61 103222682.68
3. Impairment provision
4. Book value
A. Closing book value 376192941.99 17052881.32 393245823.31
B. Opening book value 354816984.84 8713789.80 363530774.64
196 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
20.Goodwill
A.Original value of goodwill
RMB
Increased amount Decreased amount
Name of investee or item
giving rise to goodwill Opening balance Resulting from Closing balance
business Disposal
combination
Dalian Zhongjia Food
Company 290425.67 290425.67
Tianyi Chuwei (Beijing)
Technology Company 1844995.57 1844995.57
Shandong Fengkang
Company 17594587.49 17594587.49
Dazhou Wellhope
Bio-technology Company 1979591.74 1979591.74
Total 2135421.24 19574179.23 1844995.57 19864604.90
Explanation:
The goodwill recognized above primarily arose from business combinations not under common control
where the consideration paid by the Company exceeded the share of the fair value of the identifiable
net assets of the acquiree obtained in the combination.The Company determines the recoverable amount of the relevant asset groups using the present value
of expected future cash flows method. Future cash flows for the next three to five years are estimated
based on financial budgets approved by management with a terminal growth rate of 0.00% (prior
period: 0.00%). These budgets are prepared by management based on historical performance and their
expectations for future market developments. Based on the results of the impairment test the goodwill
impairment provision at the end of the current period was RMB 0 (prior period: RMB 1844995.57).B.Impairment provision for goodwill
RMB
Decreased
Invested entity or Increased amount
matters forming goodwill Opening balance
amount Closing balance
Provision Disposal
Tianyi Chuwei (Beijing)
Technology Company 1844995.57 1844995.57
Total 1844995.57 1844995.57
21.Long-term deferred expenses
RMB
Item Opening balance Increased amount Amortized amount Closing balance
Land leveling
9562916.94 238486.50 4936036.98 4865366.46 costs
Improvements to
40226945.89 16692520.36 15411087.66 41508378.59 fixed assets
Other 15534180.56 24988246.86 21495166.40 19027261.02
Total 65324043.39 41919253.72 41842291.04 65401006.07
197 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
22.Deferred tax assets /deferred tax liabilities
A. Deferred tax assets not offset
RMB
Closing balance Opening balance
Deductible Deductible
Item Deferred tax Deferred tax
temporary temporary
assets assets
difference difference
Provision for credit
41909351.478682373.1436442704.817615711.47
impairment
Provision for the
239715227.4750322619.56174392013.6038411905.63
impairment of assets
Unrealized profit on
13781926.783415687.3614338602.283046834.38
internal transactions
Deferred income 36998506.68 5791892.67 5709166.67 983925.00
Fair value changes 202400.00 50600.00 234900.00 58725.00
Lease liabilities 212942519.06 52889803.34 211468285.47 52248841.86
Share-based payment 373420.49 60676.61
Total 545923351.95 121213652.68 442585672.83 102365943.34
B. Deferred tax liabilities not offset
RMB
Closing balance Opening balance
Taxable Taxable
Item Deferred tax Deferred tax
temporary temporary
liabilities liabilities
differences differences
Carrying value of assets
217702263.9153566285.70217729256.1853459620.43
exceeds tax base
Total 217702263.91 53566285.70 217729256.18 53459620.43
C. Deferred tax assets or liabilities presented on a net basis after offsetting
Deferred tax
Deferred tax Deferred tax Deferred tax
assets or
assets and assets or assets and
liabilities at the
Item liabilities offset liabilities at the liabilities offset at
beginning of the
at the end of the end of the period the beginning of
period after
period after offsetting the period
offsetting
Deferred tax assets 52380617.84 68833034.84 102365943.34
Deferred tax liabilities 52380617.84 1185667.86 53459620.43
D. Details of unrecognized deferred tax asset
RMB
Item Closing balance Opening balance
Deductible temporary difference 85745387.98 67331835.17
Deductible losses 547479095.46 327162158.67
Total 633224483.44 394493993.84
E. Unrecognized deductible tax losses will expire in the following years
RMB
Year Closing balance Opening balance
202535070359.1035467636.74
202655180100.7456928485.24
202783463503.82106163347.12
2028110931053.08116665570.22
198 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
2029255180815.704278584.71
203076653.5376653.33
20314294631.454299903.27
20323281978.043281978.04
Total 547479095.46 327162158.67
23.Other non-current assets
RMB
Closing balance Opening balance
Item
Book balance Provision Book value Book balance Provision Book value
Prepayments for
52743172.8752743172.8776500287.2876500287.28
long-lived assets
Prepaid feeding fees
525602282.3026243830.94499358451.36521843768.88521843768.88
to contract farmers
Prepaid rent 2200000.00 2200000.00
Total 578345455.17 26243830.94 552101624.23 600544056.16 600544056.16
24.Assets with restricted ownership or usage rights
RMB
Closing balance Opening balance
Item Type of
Book balance Book value Book balance Book value Type of restriction
restriction
Monetary funds 45743263.42 45743263.42 20344238.13 20344238.13
Including:Futures
19700245.12 19700245.12 Held as margin 19369409.88 19369409.88 Held as margin
margin deposits
Margin deposits
for letters of 5106257.99 5106257.99 Held as margin 974828.25 974828.25 Held as margin
credit
Funds in
securities 20936760.31 20936760.31 Held as margin
accounts
Fixed assets 192584707.96 192584707.96 Mortgaged 96970880.23 96970880.23 Mortgaged
Intangible assets 24850032.42 24850032.42 Mortgaged
Total 263178003.80 263178003.80 / 117315118.36 117315118.36 /
25.Short-term borrowing
RMB
Item Closing balance Opening balance
Secured loan 66500000.00
Guaranteed loan 169094236.21 208263920.52
Unsecured loan 330124132.88 761240000.00
Interest payable 1560621.32 1453388.98
Total 567278990.41 970957309.50
Explanation:
At the end of the period the guaranteed borrowings represented bank loans guaranteed by the
Company on behalf of its subsidiaries including Lingyuan Wellhope Animal Husbandry Company
Baicheng Wellhope Animal Husbandry Company Lixin Xiangfeng Agriculture and Animal Husbandry
Company Liaoning Expert Trade Company Daqing Wellhope Food Company and Baotou Hechen
Animal Husbandry Company.The secured borrowings at the end of the period amounted to RMB 66.5 million which were bank
199 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
loans secured by the Company’s subsidiaries — Dazhou Wellhope Bio-technology Company and
Shandong Fengkang Food Company — by pledging assets such as equipment plant buildings and land
use rights.
26.Accounts payable
RMB
Item Closing balance Opening balance
Accounts payable related to trade and expenses 1556969201.55 1511676623.40
Accounts payable related to long-lived assets 72584477.24 118112935.54
Total 1629553678.79 1629789558.94
27.Advance receipt
RMB
Item Closing balance Opening balance
Advance payments for goods 18172031.73
Total 18172031.73
28.Contract Liabilities
RMB
Item Closing balance Opening balance
Advance payments for goods 281430591.89 252530723.35
Total 281430591.89 252530723.35
29.Employee benefits payable
A. Employee benefits
RMB
Item Opening balance Increased amount Decreased amount Closing balance
1. Short-term employee
224138953.771576366394.451561058963.43239446384.79
benefits
2. Post-employment
benefits-Defined 1218447.34 105875366.78 106052416.15 1041397.97
contribution plans
3. Termination benefits 3657124.73 3571124.73 86000.00
4. Other long-term
employee benefits due
within one year
Total 225357401.11 1685898885.96 1670682504.31 240573782.76
B. Short-term employee benefits
RMB
Opening Increased Decreased
Item Closing balance
balance amount amount
1. Salaries bonuses allowances and
221776570.051411314770.441396185330.77236906009.72
subsidies
2. Employee welfare expenses 70281821.53 69824152.42 457669.11
3. Social insurance contributions 710492.08 62586374.30 62706392.22 590474.16
including: Medical insurance
643621.9255323446.3555444576.64522491.63
contributions
Work-related injury insurance
44181.865124033.745120985.6947229.91
contributions
Maternity insurance contributions 22688.30 2138894.21 2140829.89 20752.62
200 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
4. Housing provident fund contributions 150051.76 22253668.97 22293026.73 110694.00
5. Union and employee education
1501839.889929759.2110050061.291381537.80
expenses
Total 224138953.77 1576366394.45 1561058963.43 239446384.79
C. Defined contribution plans
RMB
Item Opening balance Increased amount Decreased amount Closing balance
Basic insurance contributions 1183266.96 102284818.73 102457973.15 1010112.54
Unemployment insurance
35180.383590548.053594443.0031285.43
contributions
Total 1218447.34 105875366.78 106052416.15 1041397.97
30.Tax payable
RMB
Item Closing balance Opening balance
Value-added tax 6752457.25 2693798.13
Enterprise income tax 35959307.30 27984343.36
Individual income tax 3859929.41 2511721.24
Urban maintenance and construction tax 129737.82 128663.10
Education surcharge 102235.47 97215.04
Property tax 2130688.60 1641369.59
Urban land use tax 1749911.58 1729045.15
Stamp duty 4899112.15 5040290.51
Others 883530.78 623293.58
Total 56466910.36 42449739.70
31.Other payables
RMB
Item Closing balance Opening balance
Interest payable 10369863.01 5184931.51
Dividend payable 16453038.17
Other payables 628259826.01 458142673.91
Total 638629689.02 479780643.59
A.Interest payable
RMB
Item Closing balance Opening balance
Interest payable on convertible bonds 10369863.01 5184931.51
Total 10369863.01 5184931.51
B.Dividend payable
RMB
Item Closing balance Opening balance
Common stock dividends 16453038.17
Total 16453038.17
C.Other payables
RMB
Item Closing balance Opening balance
Operating payables related to expenses
483961450.75391398162.64
and internal transactions
Investment-related payables 14022500.00 2064978.80
201 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Employee stock ownership plan 72100000.00
Transactions with external parties 58175875.26 64679532.47
Total 628259826.01 458142673.91
32.Current portion of non-current liabilities
RMB
Item Closing balance Opening balance
Current portion of long-term borrowings 453606051.58 812076600.00
Current portion of long-term payables 15250875.29 63513759.91
Current portion of lease liabilities 28685862.68 57140197.16
Total 497542789.55 932730557.07
33.Other non-current liability
RMB
Item Closing balance Opening balance
Input VAT pending deduction/write-off 8223061.85 6656358.86
Total 8223061.85 6656358.86
34.Long-term borrowings
RMB
Item Closing balance Opening balance
Secured loans 99264210.00 101994210.00
Guaranteed loans 389750606.09 328144061.86
Unsecured loans 1407340000.00 1300210000.00
Interest payable 1405503.83 1779845.33
Subtotal 1897760319.92 1732128117.19
Less: Current portion of long-term borrowings 453606051.58 812076600.00
Total 1444154268.34 920051517.19
At the end of the reporting period the guaranteed loans represented bank loans guaranteed by the
Company on behalf of its subsidiaries including Hebei Taihang Wellhope Food Company Daqing
Wellhope Food Company Dalian Heyuan Animal Husbandry Company Dalian Zhongjia Food Company
Liaoning Qingyuan Wellhope Agriculture and Animal Husbandry Company Haicheng Wellhope Animal
Husbandry Feed Company and Anhui Wellhope Food Company.The secured borrowings amounted to RMB 99.2642 million which were obtained by the Company’s
subsidiaries — Pingyuan Wellhope Food Company Hebei Taihang Wellhope Food Company Dalian
Heyuan Animal Husbandry Company and Liaoning Qingyuan Wellhope Agriculture and Animal
Husbandry Company — using equipment as collateral.The interest rate range for bank borrowings was 3.00% to 3.45% while the interest rate range for
government borrowings was 3.00% to 10.00%.
35.Bonds payable
A.Bonds payable
RMB
Item Closing balance Opening balance
Wellhope convertible bonds 1349079789.00 1305789795.09
Total 1349079789.00 1305789795.09
202 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B.Details of bonds payable: (excluding other financial instruments such as preferred shares and perpetual bonds classified as financial liabilities)
RMB
Bond Par Bond Total issuing Interest accrued Amortization of Conversion to shares Defaulted
Coupon rate% Issuing date Opening balance Closing balance
name value term amount at par value premium/discount during the period (Yes/No)
0.3 in year 1
0.5 in year 2
Wellhope
1.0 in year 3
convertible 100 Apr. 22 2022 6 years 1500000000.00 1305789795.09 12519966.50 30778027.41 8000.00 1349079789.00 No
1.5 in year 4
bond
1.8 in year 5
2.0 in year 6
Total / / / / 1500000000.00 1305789795.09 12519966.50 30778027.41 8000.00 1349079789.00 /
C.Description of convertible corporate bonds
Bond name Conditions for conversion of shares Conversion time
Wellhope Convertible bonds may be converted into shares starting from the first trading
October 28 2022 to April 21 2028
convertible bond day after six months from the completion of issuance.Accounting treatment and basis for judgment on convertible bonds
With the approval of the China Securities Regulatory Commission (CSRC) [Approval No. 662 (2022)] the Company publicly issued 15 million convertible corporate bonds on April 22 2022 at
an issue price of RMB 100.00 per bond with a total issuance amount of RMB 1.5 billion and a term of six years. Upon approval by the Shanghai Stock Exchange [Self-Regulatory Decision No.
130 (2022)] the Company’s RMB 1.5 billion convertible corporate bonds were listed for trading on the SSE on May 18 2022 under the bond abbreviation "Wellhope Convertible Bond" and
bond code "113647".The coupon rates of the convertible bonds are set as follows: 0.30% for the first year 0.50% for the second year 1.00% for the third year 1.50% for the fourth year 1.80% for the fifth year
and 2.00% for the sixth year. Interest is paid annually and the principal of any bonds not converted into shares along with the final year’s interest will be repaid upon maturity. The bond
term is six years from the issuance date i.e. from April 22 2022 (T Day) to April 21 2028. Interest accrual begins on the issuance date (T Day) and each interest payment date falls on the
anniversary of the issuance date. If such a date falls on a statutory holiday or non-trading day payment shall be postponed to the next trading day with no additional interest accrued during
the deferral period.The initial conversion price of the convertible bonds was RMB 10.22 per share. On June 20 2022 the Company repurchased and canceled 5742000 restricted shares at a price of RMB 4.23
per share. As a result the Company adjusted the conversion price of the “Wellhope Convertible Bond” to RMB 10.26 per share effective from June 23 2022. On May 22 2023 due to the
implementation of the 2022 annual profit distribution plan the conversion price was further adjusted to RMB 10.14 per share effective from May 26 2023.In accordance with the provisions of Accounting Standards for Business Enterprises No. 37 – Presentation of Financial Instruments a non-derivative financial instrument issued by an
enterprise that contains both a financial liability component and an equity component shall be measured by separately accounting for the two components at initial recognition. Accordingly
the Company recognized: RMB 1250956156.48 (net of directly attributable issuance costs) as the financial liability component recorded under bonds payable; and RMB 238927343.52
(net of directly attributable issuance costs) as the equity component recorded under other equity instruments.
203 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
36.Lease liabilities
RMB
Item Closing balance Opening balance
Total lease payments 626129851.01 583051087.94
Less: Unrecognized finance expenses 176598390.07 157909468.49
Subtotal(Present value of lease
449531460.94425141619.45
payments)
Less: Current portion of lease liabilities 28685862.68 57140197.16
Total 420845598.26 368001422.29
37.Long-term payables
RMB
Item Closing balance Opening balance
Long-term payables 94867723.87 42542892.62
Specific payables
Total 94867723.87 42542892.62
Long-term payables presented by nature
RMB
Item Opening balance Closing balance
Finance lease payables 120762008.91 113295825.18
Unrecognized finance expenses -10643409.75 -7239172.65
Subtotal 110118599.16 106056652.53
Less: Current portion of long-term payables 15250875.29 63513759.91
Total 94867723.87 42542892.62
38.Deferred income
RMB
Opening Increased Decreased Closing
Item Reason
balance amount amount balance
Government grant 73419574.05 10475552.29 8603571.54 75291554.80
Total 73419574.05 10475552.29 8603571.54 75291554.80 /
39.Share capital
RMB
Fluctuations (increase or decrease)
Capital
Opening reserve Closing
New share
balance Bonus issue converted Others Subtotal balance
issuance
into share
capital
Total
919433663785785919434448
shares
Other explanations: In 2024 a total of RMB 8000 of Wellhope convertible bonds were converted into
shares of the Company and the number of shares resulting from the conversion was 785 shares.
40.Other equity instruments
A.Basic information on other financial instruments such as preferred shares and perpetual bonds issued
and outstanding at the end of the period
204 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
With the approval of the China Securities Regulatory Commission [Approval No. 662 (2022)] the
Company publicly issued 15 million convertible corporate bonds on April 22 2022 at an issue price of
RMB 100.00 per bond with a total issuance amount of RMB 1.5 billion and a term of six years. Upon
approval by the Shanghai Stock Exchange the Company’s RMB 1.5 billion convertible corporate bonds
were listed for trading on the SSE on May 18 2022 under the bond abbreviation "Wellhope Convertible
Bond" and bond code "113647".B.Changes in outstanding preferred shares perpetual bonds and other financial instruments at the end
of the period
RMB
Increase during Decrease during the
Outstanding Opening balance Closing balance
the period period
financial
Book Book
instruments Number Book value Number Number Number Book value
value value
Wellhope
14670080233672216.24801274.2814670000233670941.96
convertible bond
Total 14670080 233672216.24 80 1274.28 14670000 233670941.96
41.Capital reserve
RMB
Opening Increase during Decrease during
Closing balance
balance the period the period
Capital premium(Share
869439566.627817.6766617313.16802830071.13
premium)
Other capital reserves 3472482.55 1735659.69 5208142.24
Total 872912049.17 1743477.36 66617313.16 808038213.37
Explanation-- The change in capital premium for the current year includes an increase of RMB 7817.67
resulting from the conversion of convertible bonds into shares during the year and a decrease of RMB
5157313.16 due to changes in the Company’s ownership interests in its subsidiaries. 14000000
shares repurchased by the Company were transferred to the employee stock ownership plan securities
account on August 21 2024 resulting in a reduction of RMB 61460000.00 in capital premium. The
change in other capital reserves for the current year includes share-based payment expenses of RMB
1732636.56 recognized in connection with the implementation of the employee stock ownership plan
and an increase of RMB 3023.13 arising from equity-method investees.
42.Treasury stock
RMB
Opening Increased Decreased
Item Closing balance
balance amount amount
Repurchased stock of the
200003612.37287387710.9361460000.00425931323.30
Company
Total 200003612.37 287387710.93 61460000.00 425931323.30
The annual decrease in treasury shares was due to the implementation of the 2024 employee stock
ownership plan. A total of 14000000 shares held in the Company's repurchase securities account were
205 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
transferred via non-trading transfer to the ESOP securities account. As of December 31 2024 the
Company's treasury shares totaled 46944311 shares. For details regarding share-based payments
please refer to Note to Share-based Payment. The annual increase in treasury shares refers to the
accumulation of 4.35% of the Company’s total shares repurchased through bidding on the Stock
Exchange.
43.Other comprehensive income
RMB
2024
Opening After-tax After-tax
Item Closing balance
balance attributable to attributable to
Pre-tax
parent non-controlling
company interest
1. Other
comprehensive
income that can’t be -15730587.16 -14652988.21 -14642433.22 -10554.98 -30373020.38
reclassified into gains
or losses
Changes in fair value
of other equity
-15730587.16-14652988.21-14642433.22-10554.98-30373020.38
instrument
investments
2. Other
comprehensive
income that will be -8146476.88 229709.98 -1130357.83 1360067.81 -9276834.71
reclassified into gains
or losses
including: Other
comprehensive
income that can be
-6450401.01-2827128.67-2832988.685860.01-9283389.69
transferred in gains
or losses under the
equity method
Translation balance
of foreign currency -1696075.87 3056838.65 1702630.85 1354207.80 6554.98
financial statements
Total other
comprehensive -23877064.04 -14423278.23 -15772791.05 1349512.83 -39649855.09
income
44.Surplus reserve
RMB
Item Opening balance Increased amount Decrease amount Closing balance
Statutory surplus reserve 457022680.97 17662846.76 474685527.73
Total 457022680.97 17662846.76 474685527.73
45.Undistributed profit
RMB
Item 2024 2023
Undistributed profit at the end of prior period before
4400135075.824967837188.90
adjustment
Total adjustments to opening undistributed profit
(increase + decrease -)
Undistributed profit at the beginning of current period
4400135075.824967837188.90
after adjustment
Add: Net profit attributable to the owners of the
342468141.14-457037550.28
parent company in current period
206 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Less: Appropriation to statutory surplus reserve 17662846.76 3017414.09
Dividends payable on common shares 107817202.80
Others -170054.09
Undistributed profit at the end of current period 4724940370.20 4400135075.82
46.Revenue and cost
A.Information of revenue and cost
RMB
20242023
Item
Revenue Cost Revenue Cost
Primary businesses 32499057611.21 30410710308.70 35924050473.57 34501668836.06
Other businesses 46202426.66 36418856.47 46211435.84 38455427.75
Total 32545260037.87 30447129165.17 35970261909.41 34540124263.81
B.Breakdown information on revenues and costs
RMB
Total
Contract classification
Revenue Cost
Type of goods
Feed products 12509047052.89 11178618301.03
Broiler integration 11339656046.86 11020455472.07
Feed raw materials 4999646088.09 5026504887.51
Hog farming 3317621699.20 2920495993.12
Other businesses 379289150.83 301054511.44
Classified by timing of transfer of goods
Revenue recognized at a point in time 32540244557.81 30443234271.95
Revenue recognized over time 5015480.06 3894893.22
Classified by sales channel
Direct sales 23691488883.27 22153496482.45
Distribution sales 8853771154.60 8293632682.72
Total 32545260037.87 30447129165.17
Explanation:
The Company sells feed products feed raw materials meat and poultry products commercial pigs and
other goods. In accordance with the terms of the sales contracts these transactions are considered
performance obligations satisfied at a point in time. For such obligations revenue is recognized when
control of the goods is transferred to the customer. The Company’s asset leasing business is deemed to
satisfy performance obligations over time as stipulated in the lease contracts. For these obligations
revenue is recognized over time based on the progress of performance during the lease period.
47.Taxes and surtaxes
RMB
Item 2024 2023
City maintenance and construction tax 1058540.77 970600.29
Extra charges of education funds 827319.94 734254.67
House property tax 14258729.65 12885626.54
Land use tax 14462394.77 14195273.86
Stamp tax 20755474.73 20649461.73
Other 5627283.50 5524615.29
Total 56989743.36 54959832.38
207 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
48.Sales expenses
RMB
Item 2024 2023
Employee compensation 417792737.12 417073446.86
Travel expenses 123453441.73 132919025.74
Transportation loading and vehicle expenses 12058594.69 14969771.61
Service fees 18894539.11 23697073.29
Entertainment expenses 32813938.44 32226824.44
Marketing and promotion expenses 7821937.19 13072709.74
Leasing expenses 7520918.96 9267600.70
Conference expenses 9413004.93 7764762.98
Sales service expenses 33262454.04 29594914.00
Office and communication fee 8912339.22 8047246.54
Subtotal of other items 38000464.78 29732293.13
Total 709944370.21 718365669.03
49.Administration expense
RMB
Item 2024 2023
Employee compensation 361675503.74 336844279.87
Depreciation 66057168.08 59304108.82
Office and communication fee 31100000.92 30843944.70
Travel expenses 22862655.36 21668013.42
Repair and maintenance expenses 17366525.08 20831900.49
Leasing expenses 9968636.31 6794333.17
Amortization of intangible assets 12114506.16 12018541.37
Entertainment expenses 23532396.68 21008876.49
Utilities expenses 10698659.11 10131127.79
Service fees 27430054.91 25117908.18
Heating expenses 7745511.30 8101572.83
Vehicle expenses 10348633.54 9180128.38
Depreciation of right-of-use assets 16439194.37 16220683.05
Amortization of long-term amortized 7685704.77
17299181.87
expenses
Professional service fees 10023670.10 7403522.15
Board expenses 458699.92 325137.00
Equity incentive expenses 1294411.92 16480.00
Others 26114613.64 21304300.14
Total 672530023.01 614800562.62
50.R&D expenditure
RMB
Item 2024 2023
Employee compensation 18021292.08 41560993.54
Design and experiment fee 4417180.70 23770287.44
Material and appliance charge 1594640.40 8500766.24
Travel expenses 1718007.59 4001887.73
Depreciation and amortization expense 2622875.09 4210524.77
Equity incentive expenses 26877.94
Others 640263.77 1753010.27
Total 29041137.57 83797469.99
208 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
51.Financial expense
RMB
Item 2024 2023
Interest expenditure 181050699.18 179236989.51
Interest income -12294655.57 -13127370.37
Exchange loss -4964099.02 1170711.85
Service charge 4399325.72 4320341.92
Total 168191270.31 171600672.91
52.Other income
RMB
Item 2024 2023
Government grant 37800420.98 34115034.44
Handling fee for individual income
328257.81238308.79
tax withholding
Others 326782.73 159658.25
Total 38455461.52 34513001.48
53.Income from investment
RMB
Item 2024 2023
Income from long-term equity investment under the equity
129857217.55-133401069.07
method
Gain on disposal of long-term equity investments -184193.74 -3304258.63
Gain on disposal of derivative financial instruments and others -2342448.64 -815658.23
Investment income from trading financial assets during the
100273.97
holding period
Gain on remeasurement of remained equity at fair value after
933259.23-1299930.06
loss of control
Other comprehensive income previously recognized under the
2625000.00-2966102.44
equity method before the acquisition date
Gain or loss on remeasurement of previously held equity
6811688.24-6697756.66
interest at fair value on the acquisition date
Investment income from other equity instrument investments
50000.00
during the holding period
Total 137700522.64 -148334501.12
54.Gain or loss from changes in fair value
RMB
Source of gain from changes in fair value 2024 2023
Gains or loss from changes in fair value arising from derivative financial
-147128.24-490609.02
instruments
Total -147128.24 -490609.02
55.Credit impairment loss
RMB
Item 2024 2023
Bad debt losses on notes receivable -569252.61
Bad debt losses on accounts receivable -90097976.51 -28075323.61
Bad debt losses on other receivables -25000819.31 -10641632.97
Bad debt losses on other non-current assets -26243830.94
Total -141911879.37 -38716956.58
209 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
56.Asset impairment loss
RMB
Item 2024 2023
Impairment losses on contract assets 36520.55 -31391.19
Loss on decline in value of inventories and impairment
-51658722.45-143805533.19
of contract performance costs
Impairment losses on long-term equity investment -571733.76
Impairment losses on fixed assets -1080906.25
Total -53274841.91 -143836924.38
57.Gain or loss from assets disposal
RMB
Item 2024 2023
Gains or losses on disposal of fixed assets construction in
progress productive biological assets and intangible assets not 1358138.02 20674676.33
classified as held for sale
Including: Fixed assets -2604366.95 38155370.45
Intangible assets 877084.57
Productive biological asset 2162371.33 -19952257.91
Gains on disposal of right-of-use assets 923049.07 2471563.79
Total 1358138.02 20674676.33
58.Non-operating income
RMB
Amount included in current
Item 2024 2023
extraordinary items
Income from penalties and
16260608.988440256.8116260608.98
liquidated damages
Government grants unrelated to
1628125.3045214985.441628125.30
the Company’s ordinary business
Gains on disposal or write-off of
damaged or scrapped non-current 605344.55 1380187.01 605344.55
assets
Gains arising from business
combinations not under common 14299036.35
control
Others 8059683.08 4876907.37 8059683.08
Total 26553761.91 74211372.98 26553761.91
59.Non-operating expenses
RMB
Amount included in current
Item 2024 2023
extraordinary items
Donations 6101548.00 4339033.35 6101548.00
Extraordinary losses 9516356.91 29369640.72 9516356.91
Losses on disposal or write-off of
damaged or scrapped non-current 24962020.56 24035370.81 24962020.56
assets
Compensation penalties and fines 27447447.40 6520211.44 27447447.40
Others 8236959.86 1310671.75 8236959.86
Total 76264332.73 65574928.07 76264332.73
210 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
60.Income tax expense
A. Table of income tax expense
RMB
Item 2024 2023
Current income tax expense 102349023.79 108437292.60
Deferred income tax expense -18741044.07 -1345694.97
Total 83607979.72 107091597.63
B. Process of adjusting accounting profit and income tax expense
RMB
Item 2024
Total profit 393904030.08
Income tax expense calculated at the statutory/applicable tax rate 59085604.51
Effect of different tax rates applied by subsidiaries -32469477.73
Effect of adjustments to income tax of prior periods 3243371.57
Effects of non-taxable income -31398201.34
Effect of non-deductible costs expenses and losses 18773766.57
Effect of utilizing previously unrecognized deductible tax losses -16914077.78
Effect of unrecognized deductible temporary differences or tax losses
87943332.59
in the current period
Additional tax deduction for R&D expenses -3942225.77
Other -714112.90
Income tax expense 83607979.72
61.Other comprehensive income
For details of each item of other comprehensive income including the related income tax effects
amounts reclassified to profit or loss and the reconciliation of each item please refer to note of Other
Comprehensive Income.
62. Items in cash flow statement
A.Cash related to operating activities
a.Other cash received related to operating activities
RMB
Item 2024 2023
Government grants 43704939.11 78524150.40
Interest income 12294655.57 9341406.84
Subtotal of transactions and other 337298970.82 112345092.10
Total 393298565.50 200210649.34
b.Other cash paid related to operating activities
RMB
Item 2024 2023
Travel expenses 129842486.09 158588926.89
Transportation and loading expenses 59441109.58 14969771.61
R&D expenses 7319370.90 34024063.95
Entertainment expenses 40872751.34 53235700.93
Office and communication fee 33793881.52 38891191.24
Service fees 68733237.47 48814981.47
Other operating expenses paid 192254729.40 177074919.47
211 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Payments for other payables and
402577382.16107421455.84
miscellaneous items
Total 934834948.46 633021011.40
B.Cash related to investing activities
a.Other cash received related to investing activities
RMB
Item 2024 2023
Decrease in margin for letters of credit 9505937.38
Decrease in margin for futures contracts 9791205.27
Net cash received from acquisition of subsidiaries 2409207.07 1328298.23
Total 2409207.07 20625440.88
b.Other cash paid related to investing activities
RMB
Item 2024 2023
Increase in margin for futures contracts 15187238.45
Net cash paid for disposal of subsidiaries 436626.02 3029935.48
Total 15623864.47 3029935.48
C.Cash related to financing activities
a.Other cash received relating to financing activities
RMB
Item 2024 2023
Borrowings received from external counterparties 2960597.00 10548144.88
Decrease in margin for bank acceptance bills 120000.00
Cash received from stock repurchase account 1591861.08
Cash received from partial disposal of equity interests in subsidiaries 12753598.45 6834676.00
Total 17306056.53 17502820.88
b.Other cash paid related to financing activities
RMB
Item 2024 2023
Payments for repurchase of shares 310000000.00
Cash paid to acquire non-controlling interests 32688105.14 62580212.37
Cash paid to minority shareholders during company liquidation 3586630.89
Repayment of borrowings to external counterparties 43768878.34 47937133.19
Payments for lease liabilities and interest on right-of-use assets 79265552.09 81919588.47
Total 469309166.46 192436934.03
212 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
c.Changes in liabilities arising from financing activities
RMB
Increase during the period Decrease during the period
Item Opening balance Non-cash Non-cash Closing balance
Cash movements Cash movements
movements movements
Short-term loans 970957309.50 955337216.13 10493202.03 1367278025.82 2230711.43 567278990.41
Long-term loans 920051517.19 658532072.30 858407.43 17295326.55 117992402.03 1444154268.34
Long-term payables 42542892.62 47895000.00 31111154.04 18540350.04 8140972.75 94867723.87
Lease liabilities 368001422.29 134504378.99 80026792.35 1633410.67 420845598.26
Interest payable 5184931.51 12519966.50 7335035.00 10369863.01
Current portion of
932730557.07468309314.68903497082.20497542789.55
non-current liabilities
Dividends payable 16453038.17 14252502.91 17521069.88 13184471.20
Other payables -
64679532.4740029.7130207354.7227815776.698935264.9558175875.26
external parties
Total 3320601200.82 1676056821.05 688003778.39 2439309458.53 152117233.03 3093235108.70
63.Supplementary information of cash flow statement
A.Supplementary information
RMB
Further information 2024 2023
1. Reconciliation of net profit to net cash flows from
operating activities
Net profit 310296050.36 -588033027.34
add: Assets impairment provision 53274841.91 143836924.38
Credit impairment losses 141911879.37 38716956.58
Depreciation of fixed assets depletion of oil and gas assets
525039339.02457032311.40
depreciation of productive biological assets
Amortization of right-of-use asset 72500103.76 84103729.30
Amortization of intangible assets 16307671.42 14198669.42
Amortization of long-term prepaid expenses 41842291.04 31092107.23
Losses on disposal of fixed assets intangible assets and
-1358138.02-20674676.33
other long-lived assets
Losses on retirement of fixed assets 24356676.01 22655183.80
Losses on changes in fair value 147128.24 490609.02
Financial expense 181050699.18 178274391.28
Investment losses -137700522.64 148334501.12
Decrease in deferred income tax assets -18847709.34 -14457010.87
Increase in deferred income tax liabilities 106665.27 15761399.21
Decrease in inventories -96166046.05 520883086.77
Decrease in operating receivables 321180792.72 169895586.58
Increase in operating payables -258913206.47 -242357431.74
Others 1871980.75 -3600559.49
Net cash flow from operating activities 1176900496.53 956152750.32
2. Net change in cash and cash equivalents
Closing balance of cash 1748491877.60 1895034560.64
Less: Opening balance of cash 1895034560.64 1648980222.82
Add: Closing balance of cash equivalent
Less: Opening balance of cash equivalent
Net increase in cash and cash equivalents -146542683.04 246054337.82
213 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B.Net cash paid for acquisition of subsidiaries during the period
RMB
Amount
Cash or cash equivalents paid for business combinations occurred in current period 3500000.00
Of which: Dazhou Wellhope Bio-tech Company 2500000.00
Shandong Fengkang Food Company 1000000.00
Less: Cash and cash equivalents held by subsidiaries on the date of acquisition 5674745.60
Of which:Dazhou Wellhope Bio-tech Company 2265538.53
Shandong Fengkang Food Company 3409207.07
Add: Cash or cash equivalents paid in the current period for business combinations
occurring in prior periods
Net cash paid for acquisition of subsidiaries -2174745.60
C.Net cash received from disposal of subsidiaries during current period
RMB
Amount
Cash or cash equivalents received during current period for the disposal of subsidiaries 2.00
Of which: Suizhong Renhe Fishery Company 2.00
Less: Cash and cash equivalents held by subsidiaries on the date of losing control 436628.02
Of which: Suizhong Renhe Fisheries Co. Ltd. 436628.02
Add: Cash or cash equivalents received in current period from the disposal of
1875000.00
subsidiaries in prior periods
Net cash received from disposal of subsidiaries 1438373.98
D.Composition of cash and cash equivalents
RMB
Item Closing balance Opening balance
1. Cash 1748491877.60 1895034560.64
of which: Cash on hand 339635.02 202957.16
Bank deposits available for immediate payment 1748152242.58 1894831603.48
2. Cash equivalent
3. Closing balance of cash and cash equivalents 1748491877.60 1895034560.64
of which: Cash and cash equivalents with restricted use by the
parent company or subsidiaries within the group
64.Foreign currency monetary items
A. Foreign currency monetary items
RMB
Closing balance of foreign Translating Closing balance translated
Item
currency exchange rate into RMB
Monetary capital - - 24817033.52
US Dollar 3103102.91 7.1884 22306344.96
Euro 82.85 7.5257 623.50
Hong Kong Dollar 2681361.20 0.926004 2482951.20
Singapore Dollar 5095.25 5.3214 27113.86
Accounts
--41915021.24
receivable
US dollar 3155856.56 7.1884 22685559.30
Hong Kong Dollar 20766067.90 0.926004 19229461.94
Accounts payable - - 3234.78
US Dollar 450.00 7.1884 3234.78
214 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Short-term
--103788375.78
borrowing
US Dollar 14438313.92 7.1884 103788375.78
B. Explanation of overseas operating entity
Currency
Operating entity Business place abroad Local currency
selection basis
Singapore Golden Harvesta
Singapore Dollar Major currency
Trade Company
65.Leases
A.As lessee
Lease costs for short-term leases or low-value assets with simplified treatment：
RMB 15301060.17
Total cash outflows related to leases:
RMB 120717100.20
B.As lessor
Operating leases as lessor:
RMB
Of which: Income related to
Item Lease income variable lease payments not
included in lease receivables
Own property for rent 5015480.06
Total 5015480.06
C.Undiscounted lease receivables for the next five years
RMB
Undiscounted annual lease
receivables
Item
Closing Opening
balance balance
First year 7679022.68 1821634.83
Second year 8019022.75 1821634.83
Third year 8019022.75 1821634.83
Fourth year 8019022.75 1821634.83
Fifth year 5288170.15 1677493.81
The total amount of undiscounted lease receivables after five
19949290.655593536.82
years
VIII.Research and Development Expenses
1.Presentation by nature of expenses
RMB
Item 2024 2023
Employee compensation 18021292.08 41560993.54
Design and testing expenses 4417180.70 23770287.44
Materials and equipment expenses 1594640.40 8500766.24
Travel expenses 1718007.59 4001887.73
215 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Depreciation and amortization 2622875.09 4210524.77
Share-based payment expenses 26877.94
Others 640263.77 1753010.27
Total 29041137.57 83797469.99
Of which: Expensed R&D expenses 29041137.57 83797469.99
Capitalized R&D expenses
IX.Change of Consolidation Scope
1.Business combination under different control
A. Business combination under different control occurred in current period
RMB
Basis for Cash flows of Revenue of the Net profit of the
Date of Percentage Method of the acquiree
Name of the Cost of equity Acquisition determining acquiree from acquiree from
equity of equity equity the from acquisition
acquiree acquisition acquisition acquired % date acquisition date acquisition date acquisition acquisition date to
date to period-end to period-end period-end
Dazhou
Wellhope Sep. 30 Purchase of Sep. 30 Transfer of
20000000.0040.0083828561.70295982.25-1821995.74
Bio-tech 2024 equity 2024 control
Company
Shandong
Nov. 30 Purchase of Nov. 30 Transfer of
Fengkang Food 5454545.45 60.00 112581180.50 -1681261.42 8476235.57
2024 equity 2024 control
Company
B. Consideration transferred and goodwill
RMB
Consideration transferred Dazhou Wellhope Shandong Fengkang Bio-tech Company Food Company
--Cash 2500000.00 1000000.00
--Fair value of previously held equity interest on the
acquisition date 17500000.00 4454545.45
Total consideration transferred 20000000.00 5454545.45
Less: Share of fair value of identifiable net assets
acquired 18020408.26 -12140042.03
Goodwill / amount by which consideration transferred
is less than the fair value of identifiable net assets 1979591.74 17594587.48
acquired
216 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
C. Identifiable assets and liabilities of the acquiree on the acquisition date
RMB
Dazhou Wellhope Bio-tech Company Shandong Fengkang Food Company
Fair value on Book value on Fair value on Book value on
acquisition date acquisition date acquisition date acquisition date
Assets: 136854715.19 136854715.19 218985719.90 199872487.24
Monetary capital 2265538.53 2265538.53 3409207.07 3409207.07
Accounts receivable 26878667.59 26878667.59 10665395.97 10665395.97
Prepayments 6088816.05 6088816.05 3733475.68 3733475.68
Other receivables 9030053.90 9030053.90 222048.34 222048.34
Inventories 10264069.52 10264069.52 41219752.89 41219752.89
Other current assets 3298274.95 3298274.95
Fixed assets 64100628.73 64100628.73 133966665.00 122517042.12
Construction in progress 8009077.36 8009077.36
Intangible assets 10087121.20 10087121.20 22470900.00 14807290.22
Deferred income tax assets 130742.31 130742.31
Liabilities: 91803694.55 91803694.55 239219123.29 239219123.29
Borrowings 32000000.00 32000000.00 46500000.00 46500000.00
Short-term borrowings 22291769.03 22291769.03 125473954.00 125473954.00
Accounts payable 5518394.00 5518394.00 3141653.70 3141653.70
Employee benefits payable 1510627.92 1510627.92 2933247.69 2933247.69
Taxes payable 198328.92 198328.92 484300.34 484300.34
Interest payable 59473.61 59473.61
Other payables 22225101.07 22225101.07 7976243.72 7976243.72
Current portion of 8000000.00 8000000.00
non-current liabilities
Long-term payables 52709723.84 52709723.84
Net assets 45051020.64 45051020.64 -20233403.39 -39346636.05
Less: Non-controlling
interests
Net assets acquired 45051020.64 45051020.64 -20233403.39 -39346636.05
D. Gains or losses arising from the remeasurement of equity interests held prior to the acquisition
date at fair value
RMB
Methods
Amount of
and key
Date of other Percentage assumptions
acquisition Percentage of Percentage of Gains or losses comprehensive of the Carrying value
the original Fair value of
for
of the the original arising from the income related original of the original the original determining
original equity equity remeasurement to the original
equity equity equity the fair
equity interests interests of the original equity interests
Acquiree interests interests as of interests as of value of the
interests acquired prior acquired prior the equity interests that is
held prior to the to the
acquired the original
acquisition held prior to the reclassified to
to the acquisition prior to the acquisition equity acquisition date acquisition date investment
acquisition date % date
acquisition date interests as
at fair value income or
date date of the
undistributed
acquisition
profit
date
Reference
Dazhou Wellhope Bio-tech Aug. 1
35.00 12500000.00 Investment 15142857.21 17500000.00 2357142.79 transaction
Company 2020 price
Reference
Shandong Fengkang Food May 1
49.00 73500000.00 Investment 4454545.45 4454545.45 transaction
Company 2020 price
217 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
2.Disposal of subsidiary
RMB
Methods and key Amount of other
Difference between the
assumptions for comprehensive income
Consideration disposal consideration and Remaining Carrying value of Fair value of Gains or losses
Basis for determining the fair related to the equity
Point of received at Percentage of the share of the subsidiary's equity the remaining the remaining arising from the
Disposal determining value of the remaining investment in the former
Subsidiary loss of the point in disposed net assets attributable to interest at the equity interest at equity interest remeasurement of
way the point of equity interest in the subsidiary that is
control time when shareholding % the disposed investment in date of losing the date of losing at the date of the remaining equity
loss of control consolidated financial reclassified to investment
control is lost the consolidated financial control % control losing control at fair value
statements as of the income or undistributed
statements
date of losing control profit
Suizhong
Renhe Apr. 30 Transfer Reference transaction
2.00 60.00 Loss of control 1866518.45 30.00 -933258.23 1.00 933259.23
Fishery 2024 of equity price
Company
Russia
Wellhope Dec. 31 Transfer Reference transaction
0.00 55.00 Loss of control -383605.03 -1721647.66
Agri-Tech 2024 of equity price
Company
218 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
3.Change of consolidation scope due to other reasons
A. New subsidiaries included in the scope of consolidation during the period
Company name Acquisition method
Huaibei Wellhope Animal Husbandry Company Investment
Tieling Wellhope Food Company Investment
Mianyang Wellhope Bio-tech Company Investment
Siping Wellhope Food Company Investment
Wellhope E-Commerce (Liaoning) Company Investment
Hunan Wellhope Agriculture and Animal Husbandry Company Investment
Tieling Wellhope Animal Husbandry Company Investment
Shandong Jiayixiang Agriculture and Animal Husbandry Technology Investment
Company
Dalian Wellhope Pig Breeding Company Investment
Xingcheng Wellhope Pig Breeding Company Investment
Wellhope Fuxinyuan Supply Chain (Chifeng) Company Investment
Jingzhou Jingu Agriculture and Animal Husbandry Company Investment
Xuchang Wellhope Animal Husbandry Company Investment
Fushun Hexin Animal Husbandry Company Investment
Chaoyang Hemei Food Company Investment
B. Subsidiaries no longer included in the scope of consolidation in the current period due to
deregistration
Company name Reason
Tianyi Chuwei (Beijing) Technology Company Deregistration
Shenyang Huaweida Animal Health Products Company Deregistration
Fuyang Wellhope Agriculture and Animal Husbandry Technology Company Deregistration
219 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
X.Equity in other Entities
1.Equity in subsidiaries
A.Composition of the Company
RMB 10000
Registered Registered Shareholding %
Subsidiary Business site Business type Way of acquisition
capital site Direct Indirect
Haicheng Haicheng
Haicheng Xinzhongxin Feed Company 600.00 Production 51.00 Investment
City City
Dalian Huakang Xinxin Food Company Dalian City 1600.00 Dalian City Production 65.00 11.00 Investment
Changchun Hengfeng Agriculture and Changchun Changchun
4700.00 Trade 49.47 Investment
Animal Husbandry Company City City
Jinan Xinweita Technology and Trade
Jinan City 1500.00 Jinan City Trade 62.00 Investment
Company
Henan Wellhope Animal Husbandry
Kaifeng City 3000.00 Kaifeng City Production 100.00 Investment
Company
Zhengzhou Wellhope Animal Husbandry Zhengzhou Zhengzhou
800.00 Production 100.00 Investment
Company City City
Zhumadian Wellhope Animal Husbandry Zhumadian Zhumadian
1000.00 Production 90.00 Investment
Company City City
Jiaozuo Wellhope Feed Company Jiaozuo City 5000.00 Jiaozuo City Production 100.00 Investment
Nanyang Wellhope Feed Company Nanyang City 1000.00 Nanyang City Production 100.00 Investment
Zhangwu Wellhope Agricultural Zhangwu Zhangwu
300.00 Production 60.00 Investment
Development Company County County
Heilongjiang Sanjiang Wellhope Animal
Jixian County 2100.00 Jixian County Production 61.00 Investment
Husbandry Company
Jixian Expert Trade Company Jixian County 500.00 Jixian County Trade 65.00 Investment
Gongzhuling Wellhope Animal Husbandry Gongzhuling Gongzhuling
3500.00 Production 100.00 Investment
Company City City
Shenyang Shenyang
Shenyang Expert Trade Company 1000.00 Trade 82.00 Investment
City City
Shenyang Shenyang
Liaoning Skyland Equipment Company 2775.00 Production 100.00 Investment
City City
Shenyang Wellhope Ruminant Feed Shenyang Shenyang
550.00 Production 100.00 Investment
Company City City
Shenyang Wellhope Extruded Feed Shenyang Shenyang
3300.00 Production 100.00 Investment
Company City City
Shenyang Wellhope Aquatic Feed Shenyang Shenyang
1500.00 Production 100.00 Investment
Company City City
Shenyang Shenyang
Shenyang Jiahetianfeng Trade Company 1000.00 Trade 100.00 Investment
City City
Liaoning Wellhope Food Company Beipiao City 5000.00 Beipiao City Production 60.00 Investment
Haicheng Wellhope Animal Husbandry Haicheng Haicheng
1250.00 Production 100.00 Investment
Feed Company City City
Tai’an Tai’an
Tai'an Wellhope Feed Company 3200.00 Production 100.00 Investment
County County
Lingyuan Wellhope Animal Husbandry
Lingyuan City 500.00 Lingyuan City Production 90.50 Investment
Company
Beijing Wellhope Animal Husbandry
Beijing 500.00 Beijing Trade 100.00 Investment
Technology Company
Beijing Sanyuan Wellhope Animal
Beijing 1000.00 Beijing Production 70.00 Investment
Husbandry Company
Jilin Wellhope Animal Husbandry
Jilin City 1600.00 Jilin City Production 100.00 Investment
Company
Gongzhuling Gongzhuling
Jilin Wellhope Pig Breeding Company 1500.00 Production 100.00 Investment
City City
Daqing Wellhope Bayi Nongda Animal
Daqing City 4000.00 Daqing City Production 90.00 Investment
Science and Technology Company
Mudanjiang Wellhope Animal Husbandry Mudanjiang Mudanjiang
2300.00 Production 100.00 Investment
Company City City
Jinzhou Wellhope Animal Husbandry
Jinzhou City 1700.00 Jinzhou City Production 100.00 Investment
Company
Gongzhuling Wellhope Ruminant Feed Gongzhuling Gongzhuling
500.00 Production 100.00 Investment
Company City City
Heilongjiang Wellhope Animal Husbandry
Harbin City 12000.00 Harbin City Production 100.00 Investment
Company
Tangshan Tangshan
Tangshan Wellhope Feed Company 5000.00 Production 90.00 Investment
City City
220 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Cangzhou Cangzhou
Cangzhou Helai Technology Company 500.00 Production 70.00 Investment
City City
Xi'an Wellhope Feed Technology
Xi'an City 500.00 Xi'an City Production 80.00 Investment
Company
Gansu Wellhope Animal Husbandry
Wuwei City 4000.00 Wuwei City Production 100.00 Investment
Company
Jining Wellhope Animal Husbandry
Jining City 2800.00 Jining City Production 70.00 Investment
Company
Shanghai Shanghai
Shanghai Wellhope Feed Company 300.00 Production 65.00 Investment
City City
Shanghai Shanghai
Shanghai Hehong Trade Company 2400.00 Trade 70.00 Investment
City City
Zhejiang Pinghu Wellhope Animal
Pinghu City 100.00 Pinghu City Production 85.00 Investment
Husbandry Company
Huai'an Wellhope Feed Company Huai’an City 3000.00 Huai’an City Production 100.00 Investment
Qingdao Wellhope Animal Husbandry
Pingdu City 3000.00 Pingdu City Production 95.00 Investment
Company
Guangzhou Xiangshun Animal Husbandry Guangzhou Guangzhou
500.00 Production 56.00 Investment
Equipment Company City City
Hainan Wellhope Animal Husbandry Chengmai Chengmai
9500.00 Production 60.00 Investment
Company County County
Fuyu Wellhope Animal Husbandry
Fuyu City 4800.00 Fuyu City Production 97.00 Investment
Company
Fuyu Wellhope Taolaizhao Poultry
Fuyu City 2620.00 Fuyu City Productiong 98.19 Investment
Breeding Company
Nong’an Nong'an
Changchun Wellhope Feed Company 8600.00 Production 98.00 Investment
County County
Lankao Wellhope Animal Husbandry Lankao Lankao
4300.00 Production 100.00 Investment
Company County County
Tongliao Wellhope Tianyi Grass Industry
Tongliao City 2000.00 Tongliao City Production 51.00 Investment
Company
Shenyang Shenyang
Liaoning Wellhope Trade Company 3000.00 Trade 100.00 Investment
City City
Shenyang Wellhope Animal Husbandry Shenyang Shenyang
8210.00 Production 100.00 Investment
Company City City
Shenyang Shenyang Business combinations
Liaoning Expert Trade Company 8000.00 Trade 100.00
City City under common control
Shenyang Shenyang Business combinations
Shenyang Fame Bio-tech Company 2000.00 Production 100.00
City City under common control
Shenyang Shenyang Business combinations
Shenyang Pufeng Trade Company 700.00 Trade 100.00
City City under common control
Shenyang Huawei Pharmaceutical Shenyang Shenyang Business combinations
1000.00 Production 51.00
Company City City under common control
Liaoning Wellhope Agriculture and
Shenyang Shenyang Business combinations not
Animal Husbandry Development 10000.00 Production 100.00
City City under common control
Company
Business combinations not
Puyang Wellhope Food Company Puyang City 3500.00 Puyang City Production 60.00
under common control
Jingzhou Wellhope Agricultural
Jingzhou City 5000.00 Jingzhou City Production 86.00 Investment
Technology Company
Dalian Heyuan Animal Husbandry
Dalian City 10000.00 Dalian City Production 57.00 Investment
Company
Shenyang Nongda Wellhope Feed Shenyang Shenyang
4420.00 Production 100.00 Investment
Company City City
Dalian Wellhope Feed Company Dalian City 4710.00 Dalian City Production 100.00 Investment
Xingcheng Wellhope Feed Company Xingcheng 8250.00 Xingcheng Production 100.00 Investment
Yunnan Wellhope Feed Company Kunming City 2500.00 Kunming City Production 100.00 Investment
Shenyang Shenyang
Liaoning Godaji E-Commerce Company 2000.00 Trade 100.00 Investment
City City
Anhui Wellhope Animal Husbandry
Bozhou City 16000.00 Bozhou City Production 70.00 Investment
Company
Shanxi Wellhope Animal Husbandry Yuanping Yuanping
4800.00 Production 100.00 Investment
Company City City
Pingyuan Wellhope Food Processing
Handan City 20992.00 Handan City Production 100.00 Investment
Company
Business combinations not
Dalian Zhongjia Food Company Dalian City 3963.00 Dalian City Production 100.00
under common control
Shenyang Shenyang
Wellhope Food (Shenyang) Company 500.00 Production 100.00 Investment
City City
Changchun Wellhope Food Company Changchun 1000.00 Changchun Production 85.00 Investment
221 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
City City
Pingyuan Wellhope Animal Husbandry
Handan City 13550.00 Handan City Production 100.00 Investment
Company
Puyang Wellhope Animal Husbandry
Puyang City 7600.00 Puyang City Production 100.00 Investment
Company
Beijing Brilliant Dragon Animal Health
Beijing City 800.00 Beijing City Trade 61.00 Investment
Products Trade Company
Tangshan Hejia Agriculture and Animal Tangshan Tangshan
3000.00 Production 65.00 35.00 Investment
Husbandry Company City City
Tangshan Tangshan Business combinations not
Tangshan Wellhope Technology Company 3000.00 Production 70.00
City City under common control
Shenyang Shenyang
Shenyang Huakang Xinxin Food Company 200.00 Production 85.00 Investment
City City
Kaifeng Wellhope Meat Food Company Kaifeng City 10000.00 Kaifeng City Production 100.00 Investment
Shenyang Huakang Meat Poultry Shenyang Shenyang
6200.00 Production 95.00 Investment
Company City City
Agriculture and Animal Husbandry
Kaifeng City 13100.00 Kaifeng City Production 100.00 Investment
Technology
Fushun Wellhope Agriculture and Animal
Fushun City 3000.00 Fushun City Production 100.00 Investment
Husbandry Company
Shenyang Wellhope Poultry Industry Shenyang Shenyang
5000.00 Production 100.00 Investment
Company City City
Dehui Wellhope Animal Husbandry
Dehui City 100.00 Dehui City Production 100.00 Investment
Company
Chongqing Wellhope Agriculture and Chongqing Chongqing
500.00 Production 65.00 Investment
Animal Husbandry Company City City
Shulan Fengtai Agriculture and Animal
Shulan City 8000.00 Shulan City Production 80.00 Investment
Husbandry Company
Daqing Bifeng Animal Husbandry
Daqing 1000.00 Daqing City Production 51.00 Investment
Company
Linyi Helai Animal Husbandry Company Linyi City 3300.00 Linyi City Production 100.00 Investment
Nanchang Wellhope Animal Husbandry Nanchang
Nanchang 1000.00 Production 65.00 Investment
Company City
Anhui Wellhope Haoxiang Agricultural
Lixin County 5000.00 Lixin County Production 100.00 Investment
Development Company
Lixin Xiangfeng Agriculture and Animal
Lixin County 1000.00 Lixin County Production 100.00 Investment
Husbandry Company
Lixin Hongfeng Agriculture and Animal
Lixin County 5000.00 Lixin County Production 100.00 Investment
Husbandry Company
Guangzhou Guangzhou
Guangzhou Dashang Trade Company 500.00 Trade 51.00 Investment
City City
Shandong Heyuan Food Company Weihai City 18000.00 Weihai City Production 100.00 Investment
Wafangdian Yifeng Animal Husbandry Wafangdian Wafangdian
3500.00 Production 51.00 Investment
Company City City
Business combinations not
Hebei Deheng Breeding Company Handan City 1700.00 Handan City Production 100.00
under common control
Yangling Wellhope Agriculture and Business combinations not
Xianyang City 4200.00 Xianyang City Production 100.00
Animal Husbandry Company under common control
Dunhua Wellhope Animal Husbandry Business combinations not
Dunhua City 1000.00 Dunhua City Production 51.00
Company under common control
Dunhua Fengda Agriculture and Animal Business combinations not
Dunhua City 1000.00 Dunhua City Production 51.00
Husbandry Development Company under common control
Anhui Wellhope Food Company Lixin County 5000.00 Lixin County Production 100.00 Investment
Anyang Wellhope Agriculture and Animal
Anyang City 5500.00 Anyang City Production 100.00 Investment
Husbandry Company
Hebei Taihang Wellhope Food Company Baoding City 33534.44 Baoding City Production 92.00 Investment
Shenyang Xiangmai E-commerce Shenyang Shenyang
100.00 Trade 65.00 Investment
Company City City
Chifeng Wellhope Fuxinyuan Food
Chifeng City 17000.00 Chifeng City Production 70.00 Investment
Company
Chengmai Chengmai
Hainan Expert Trade Company 1000.00 Trade 71.00 Investment
County County
Liaoning Qingyuan Wellhope Agriculture
Fushun City 12000.00 Fushun City Production 95.00 Investment
and Animal Husbandry Company
Nanyang Jinwan Animal Husbandry
Nanyang City 1250.00 Nanyang City Production 51.00 Investment
Company
Fuzhou Wellhope Xingyuan Animal
Fuzhou City 8000.00 Fuzhou City Production 91.00 Investment
Husbandry Development Company
Tianjin Fengyunda Supply Chain Company Tianjin City 1000.00 Tianjin City Other 100.00 Investment
222 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Daqing Wellhope Food Company Daqing City 1500.00 Daqing City Production 51.00 Investment
Zhumadian Wellhope Agricultural Zhumadian
3191.00 Zhumadian Production 100.00 Investment
Development Company City
Datong Hejia Agriculture and Animal
Datong City 2000.00 Datong City Production 65.00 35.00 Investment
Husbandry Company
Shijiazhuang Hejia Agriculture and Animal Shijiazhuang
2000.00 Shijiazhuang Production 65.00 35.00 Investment
Husbandry Company City
Fuxin Wellhope Agriculture and Animal
Fuxin City 3000.00 Fuxin City Production 100.00 Investment
Husbandry Company
Dalian Hongtu Animal Husbandry
Dalian City 1600.00 Dalian City Production 51.00 Investment
Company
Shandong Heyuan Animal Husbandry
Weihai City 6000.00 Weihai City Production 100.00 Investment
Company
Wafangdian Huinong Poultry Industry Wafangdian Wafangdian
6800.00 Production 52.94 Investment
Company City City
Luoyang Wellhope Agriculture and
Luoyang City 7500.00 Luoyang City Production 100.00 Investment
Animal Husbandry Company
Gongzhuling Wellhope Pig Breeding Gongzhuling Gongzhuling
678.00 Production 100.00 Investment
Company City City
Lishu Wellhope Ecological Breeding
Siping City 1800.00 Siping City Production 68.50 Investment
Company
Kaifeng Jiufeng Agriculture and Animal
Kaifeng City 5319.00 Kaifeng City Production 100.00 Investment
Husbandry Company
Tianjin Expert Trade Company Tianjin City 2500.00 Tianjin City Trade 100.00 Investment
Liaoning Wellhope Egg Industry Company Anshan City 18000.00 Anshan City Production 75.15 Investment
Shenyang Wellhope Animal Husbandry Shenyang Shenyang
2000.00 Production 100.00 Investment
Company City City
Lingyuan Wellhope Agriculture and
Lingyuan City 500.00 Lingyuan City Production 100.00 Investment
Animal Husbandry Company
Shenyang Wellhope Pig Breeding Shenyang Shenyang
500.00 Production 100.00 Investment
Company City City
Shenyang Xiaohe Agriculture and Animal Shenyang Shenyang
500.00 Production 100.00 Investment
Husbandry Company City City
Qingdao Haifeng Animal Husbandry Business combinations not
Qingdao City 500.00 Qingdao City Production 100.00
Company under common control
Business combinations not
Xi'an Linfeng Shengyi Trade Company Xi'an City 600.00 Xi'an City Trade 100.00
under common control
Beijing Linfeng Shengyi Commerce and
Beijing City 500.00 Beijing City Trade 60.00 Investment
Trade Company
Fame (Shenyang) Biological High-tech Shenyang Shenyang
500.00 Other 100.00 Investment
Industry Research Institute Company City City
Changsha Wellhope Animal Husbandry Changsha Changsha
1000.00 Production 83.00 Investment
Company City City
Fuyu Wellhope Egg Poultry Company Fuyu City 1000.00 Fuyu City Production 52.00 Investment
Harbin Linfeng Shengyi Trade Company Harbin City 500.00 Harbin City Trade 51.00 Investment
Lixin Rongfeng Agriculture and Animal
Bozhou City 5000.00 Bozhou City Production 100.00 Investment
Husbandry Company
Fuxin Wellhope Agriculture and Animal
Fuxin City 3000.00 Fuxin City Production 100.00 Investment
Husbandry Technology
Tangshan Tangshan
Hebei Linfeng Shengyi Trade Company 300.00 Trade 100.00 Investment
City City
Shuozhou Shuozhou
Huairen Dazhuang Breeding Company 150.00 Production 70.00 Investment
City City
Harbin Wellhope Agriculture and Animal
Harbin City 500.00 Harbin City Production 51.00 Investment
Husbandry Development Company
Suihua Wellhope Animal Husbandry
Suihua City 5835.00 Suihua City Production 47.30 37.70 Investment
Company
Jilin Dalong Wellhope Animal Husbandry
Jilin City 1700.00 Jilin City Production 24.29 26.71 Investment
Company
Daqing Wellhope Animal Husbandry
Daqing City 1000.00 Daqing City Production 51.00 Investment
Company
Qiqihar Wellhope Animal Husbandry
Qiqihar City 1500.00 Qiqihar City Production 51.00 Investment
Company
Lankao Lankao Business combinations not
Lankao Tiandi Feed Company 4000.00 Production 100.00
County County under common control
Linyi Wellhope Animal Husbandry
Linyi City 1500.00 Linyi City Production 100.00 Investment
Company
Jiyuan Helai Feed Company Jiyuan City 2300.00 Jiyuan City Production 100.00 Investment
Wan'an Wellhope Feed Company Ji’an City 1500.00 Ji'an City Production 52.00 Investment
223 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Baotou Hechen Animal Husbandry
Baotou City 3368.00 Baotou City Production 46.77 Investment
Company
Haicheng New Hongzunda Animal Hai Cheng Haicheng Business combinations not
4400.00 Production 51.00
Husbandry Company City City under common control
Chifeng Wellhope Animal Husbandry
Chifeng City 800.00 Chifeng City Production 85.00 Investment
Company
Neihuang Wellhope Animal Husbandry
Anyang City 8000.00 Anyang City Production 75.00 20.00 Investment
Company
Tailai Wellhope Agriculture and Animal Business combinations not
Tailai County 20000.00 Tailai County Production 70.00
Husbandry Company under common control
Inner Mongolia Xinhaoji Agriculture and
Xing'an Xing'an Business combinations not
Animal Husbandry Development 5000.00 Production 71.00
League League under common control
Company
Zhangjiakou Wellhope Agriculture and Zhangjiakou Zhangjiakou Business combinations not
7692.00 Production 100.00
Animal Husbandry Company City City under common control
Tangshan Fengnan Heyou Agriculture and Tangshan Tangshan Business combinations not
3000.00 Production 100.00
Animal Husbandry Company City City under common control
Hengshui Hechen Agriculture and Animal Hengshui Hengshui Business combinations not
1700.00 Production 100.00
Husbandry Company City City under common control
Hengshui Heyou Agriculture and Animal Hengshui Hengshui Business combinations not
1000.00 Production 16.00 73.00
Husbandry Company City City under common control
Shenze Hezhi Agricultural and Animal Shenze Shenze Business combinations not
2000.00 Production 15.00 80.10
Husbandry Company County County under common control
Xinji Heyou Agricultural and Animal Business combinations not
Xinji City 1200.00 Xinji City Production 15.00 85.00
Husbandry Company under common control
Hengshui Hengshui
Hengshui Wellhope Feed Company 800.00 Production 80.00 Investment
City City
Hebei New Taihang Wellhope Animal
Baoding City 10000.00 Baoding City Production 100.00 Investment
Husbandry Company
Siping Huiliang Wellhope Animal
Siping City 1000.00 Siping City Production 51.00 Investment
Husbandry Company
Singapore Golden Harvesta Trade
Singapore USD1000.00 Singapore Trade 100.00 Investment
Company
Tangshan Lekai Animal Husbandry Tangshan Tangshan
10.00 Investment 99.90 Investment
Partnership (Limited Partnership) City City
Baicheng Wellhope Animal Husbandry Baicheng Baicheng
1000.00 Production 51.00 Investment
Company City City
Dalian Heyuan Animal Husbandry
Dalian City 7000.00 Dalian City Production 52.00 33.00 Investment
Company
Dalian Rixin Plumbing and Building Business combinations not
Dalian City 4000.00 Dalian City Production 100.00
Materials Company under common control
Heilongjiang Wellhope Dasenlin Food
Qitaihe City 2000.00 Jiutai City Production 51.00 Investment
Company
Heilongjiang Wellhope Dasenlin Animal
Qitaihe City 2000.00 Jiutai City Production 51.00 Investment
Husbandry Company
Tianjin Wellhope Trade Company Tianjin City 1500.00 Tianjin City Trade 79.00 Investment
Huaibei Wellhope Animal Husbandry
Huaibei City 1000.00 Huaibei City Production 62.50 Investment
Company
Tieling Wellhope Food Company Tieling City 3000.00 Tieling City Production 90.00 Investment
Mianyang Mianyang
Mianyang Wellhope Bio-tech Company 1000.00 Production 52.00 Investment
City City
Siping Wellhope Food Company Siping City 10000.00 Siping City Production 70.00 Investment
Hunan Wellhope Agriculture and Animal Changsha Changsha
4900.00 Production 100.00 Investment
Husbandry Company City City
Business combinations not
Shandong Fengkang Food Company Yantai City 15000.00 Yantai City Production 60.00
under common control
Shandong Jiayixiang Agriculture and
Weifang City 3000.00 Weifang City Production 40.00 Investment
Animal Husbandry Company
Business combinations not
Dazhou Wellhope Bio-tech Company Dazhou City 5000.00 Dazhou City Production 40.00
under common control
Wellhope E-Commerce (Liaoning) Shenyang Shenyang
1000.00 Trade 100.00 Investment
Company City City
Tieling Wellhope Animal Husbandry
Tieling City 3000.00 Tieling City Production 100.00 Investment
Company
Lanxi Fengyuan Agriculture and Animal
Suihua City 500.00 Suihua City Production 51.00 Investment
Husbandry Company
Dalian Wellhope Pig Breeding Company Dalian City 500.00 Dalian City Production 100.00 Investment
Xingcheng Wellhope Pig Breeding Xingcheng Xingcheng
500.00 Production 100.00 Investment
Company City City
Fushun Hexin Animal Husbandry Fushun City 1000.00 Fushun City Production 100.00 Investment
224 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Company
Wellhope Fuxinyuan Supply Chain
Chifeng City 50.00 Chifeng City Trade 100.00 Investment
(Chifeng) Company
Chaoyang Chaoyang
Chaoyang Hemei Food Company 500.00 Production 100.00 Investment
City City
Xuchang Wellhope Animal Husbandry
Yuzhou City 200.00 Yuzhou City Production 100.00 Investment
Company
Jingzhou Jingu Agriculture and Animal
Jingzhou City 100.00 Jingzhou City Production 86.00 Investment
Husbandry Company
The basis for holding 50% or less of the voting rights but still controlling the invested entity and
holding more than 50% of the voting rights but not controlling the invested entity:
The Company holds 40% equity interest in Dazhou Wellhope Bio-tech Company as its largest single
shareholder. Meanwhile since it has entered into a concerted action agreement with Pu Guisheng a
minority shareholder holding 26.85% equity interest therein they are concert parties. Therefore the
Company has actual control over Dazhou Wellhope Bio-tech Company.The Company holds 40% equity interest in Shandong Jiayixiang Agriculture and Animal Husbandry
Technology Company as its largest single shareholder. Meanwhile since it has entered into a
concerted action agreement with Weifang Xinggefeng Agricultural Science and Technology Company a
minority shareholder holding 30% equity interest therein they are concert parties. Therefore the
Company has actual control over Shandong Jiayixiang Agriculture and Animal Husbandry Technology
Company.B.Significant non-wholly owned subsidiary
RMB
Gain or loss
Shareholding of Declared dividends to Closing balance of
attributable to
Subsidiary non-controlling non-controlling non-controlling
non-controlling
interests % interests interests
interests
Dalian Heyuan
Animal Husbandry 43.00 -13427329.80 295611111.47
Company
Xi'an Wellhope
Feed Technology 20.00 5152677.98 54749033.33
Company
Beijing Sanyuan
Wellhope Animal
30.009329696.8021000000.0066103876.56
Husbandry
Company
Jingzhou Wellhope
Agriculture and
Animal Husbandry 14.00 1116948.46 7406185.05
Technology
Company
225 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
C.Financial figures of significant non-wholly owned subsidiary
RMB
Closing balance Opening balance
Subsidiary Current Non-current Non-current Current Non-current
Current assets Non-current assets Total assets Total liabilities Current assets Total assets Total liabilities
liabilities liabilities assets liabilities liabilities
Dalian
Heyuan
Animal 600831501.67 1129613449.17 1730444950.84 899830391.50 143805279.76 1043635671.26 715240246.03 974379130.37 1689619376.40 760607527.85 171109410.84 931716938.69
Husbandry
Company
Xi'an
Wellhope
Feed 247122456.14 84846567.59 331969023.73 57553936.61 669920.49 58223857.10 204843733.11 90546515.63 295390248.74 46753270.99 684752.68 47438023.67
Technology
Company
Beijing
Sanyuan
Wellhope
257950390.9436774478.40294724869.3451665597.1422713017.0174378614.15250374750.6214196891.17264571641.7945353083.2545353083.25
Animal
Husbandry
Company
Jingzhou
Wellhope
Agriculture
and
53433679.4858949756.86112383436.3458775114.55707000.0059482114.5556466360.8265007234.70121473595.5299676676.89808000.00100484676.89
Animal
Husbandry
Technology
Company
20242023
Total Total
Subsidiary Cash flow from Cash flow from
Revenue Net profit comprehensive Revenue Net profit comprehensive
operating activities operating activities
income income
Dalian Heyuan Animal
2536818974.20-31226347.39-31226347.39244443045.383854833036.13-81296154.26-81296154.26240466374.04
Husbandry Company
Xi'an Wellhope Feed
914619622.2325763389.8925763389.8926788045.33806399333.7528284736.1728284736.1740223965.02
Technology Company
Beijing Sanyuan
578509350.5731098989.3231098989.3215140326.25755764730.1432087984.3132087984.3154995249.36
Wellhope Animal
226 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Husbandry Company
Jingzhou Wellhope
Agriculture and Animal
361691247.477978203.277978203.275751736.78427504053.487312850.017312850.0113512322.27
Husbandry Technology
Company
227 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
2.Transactions that change the share of owner's equity in subsidiaries while retaining control over
the subsidiaries
A.Description of changes in share of owner's equity
During the period the Company transferred 11% of the equity interest in its subsidiary Hainan Expert
Trade Company 14% of the equity interest in its subsidiary Tianjin Expert Trade Company and 18% of
the equity interest in its subsidiary Shenyang Expert Trade Company.During the period the Company increased its holdings in its subsidiaries as follows: 5.9974% of the
equity interest in Kaifeng Jiufeng Agriculture and Animal Husbandry Company 5.986% of the equity
interest in Zhumadian Wellhope Agricultural Development Company 10% of the equity interest in
Dunhua Wellhope Animal Husbandry Company 20% of the equity interest in Shulan Fengtai Agriculture
and Animal Husbandry Company 5% of the equity interest in Tangshan Wellhope Feed Company
11.57% of the equity interest in Inner Mongolia Xinhaoji Agriculture and Animal Husbandry
Development Company 20% of the equity interest in Dalian Heyuan Animal Husbandry Company 10%
of the equity interest in Dunhua Fengda Agriculture and Animal Husbandry Development Company
15.5% of the equity interest in Fuzhou Wellhope Xingyuan Animal Husbandry Development Company
10% of the equity interest in Zhangjiakou Wellhope Agriculture and Animal Husbandry Company and
2% of the equity interest in Hebei Taihang Wellhope Food Company.
B.The impact of the transaction on non-controlling interests and the equity attributable to the
owners of parent company
RMB
Kaifeng Jiufeng
Hainan Tianjin Expert Shenyang
Agriculture and
Expert Trade Trade Trade
Animal Husbandry
Company Company Company
Company
Cost of acquisition/disposal
considerations
-Cash 359729.62 3500000.00 1918868.83 1.00
-Fair value of non-cash assets
Total cost of acquisition or disposal
considerations 359729.62 3500000.00 1918868.83 1.00
less: Share of net assets in the
subsidiary calculated by the
percentage of acquired or disposed 435604.97 4016010.37 2561973.94 -2936205.98
shareholdings
Difference -75875.35 -516010.37 -643105.11 2936206.98
of which: Adjustment to capital
reserve -75875.35 -516010.37 -643105.11 -2936206.98
Adjustment to surplus reserve
Adjustment to undistributed
profits
Zhumadian Inner Dunhua
Tangshan Dalian Heyuan
Wellhope Mongolia Fengda
Wellhope Animal
Agricultural Xinhaoji Agriculture
Feed Husbandry
Development Agriculture and Animal
Company Company
Company and Animal Husbandry
228 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Husbandry Development
Development Company
Company
Cost of
acquisition/disposal
considerations
-Cash 1.00 3677511.03
-Fair value of non-cash
assets 14725074.00 59553743.44 1574514.10
Total cost of acquisition
or disposal 1.00 3677511.03 14725074.00 59553743.44 1574514.10
considerations
less: Share of net assets
in the subsidiary
calculated by the
percentage of acquired -1072172.58 3647197.91 10720028.46 59385664.50 1574514.10
or disposed
shareholdings
Difference 1072173.58 30313.12 4005045.54 168078.94
of which: Adjustment to
capital reserve -1072173.58 -30313.12 -4005045.54 -168078.94
Adjustment to
surplus reserve
Adjustment to
undistributed profits
Fuzhou
Zhangjiakou Shulan
Wellhope Hebei Dunhua
Wellhope Fengtai
Xingyuan Taihang Wellhope
Agriculture Agriculture
Animal Wellhope Animal
and Animal and Animal
Husbandry Food Husbandry
Husbandry Husbandry
Development Company Company
Company Company
Company
Cost of
acquisition/disposal
considerations
-Cash 12400000.00 7000000.00
-Fair value of non-cash
assets 6706900.00 2508074.98 13364704.20
Total cost of acquisition or
disposal considerations 12400000.00 7000000.00 6706900.00 2508074.98 13364704.20
less: Share of net assets in
the subsidiary calculated
by the percentage of 11966672.45 13460535.22 5748283.88 2508074.98 13364704.20
acquired or disposed
shareholdings
Difference 433327.55 -6460535.22 958616.12
of which: Adjustment to
capital reserve -433327.55 6460535.22 -958616.12
Adjustment to
surplus reserve
Adjustment to
undistributed profits
229 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
3.Equity in joint ventures or associated companies
A.Important joint ventures or associated companies
Business Registered Business Shareholding % Accounting
Company
site site type Direct Indirect treatment
Beipiao Hongfa Food Beipiao Beipiao
Production 35.00 Equity method
Company city city
Anshan Jiuguhe Food Tai'an Tai'an
Production 41.55 Equity method
Company county county
Tai’an Jiuguhe Agriculture Tai'an Tai'an
Production 41.55 Equity method
Development Company county county
Dalian Chengsan Food Dalian
Dalian city Production 20.00 Equity method
Group Company city
230 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B.Financial figures of important joint ventures or associated companies
RMB
20242023
Tai’an Jiuguhe Tai’an Jiuguhe
Dalian Chengsan Dalian Chengsan
Beipiao Hongfa Anshan Jiuguhe Agriculture Beipiao Hongfa Anshan Jiuguhe Agriculture
Food Group Food Group
Food Company Food Company Development Food Company Food Company Development
Company Company
Company Company
Current assets 1469130876.16 805767132.08 663459640.85 1745445351.68 1302293418.95 835334488.93 695805327.33 1771343843.54
Non-current assets 1663280904.74 261131707.09 128749797.45 664759590.15 1588715537.01 246286145.99 95369809.62 712175132.58
Total assets 3132411780.90 1066898839.17 792209438.30 2410204941.83 2891008955.96 1081620634.92 791175136.95 2483518976.12
Current liabilities 1130806995.72 395301799.94 738114901.96 777856537.96 967892510.66 435777855.47 724350582.67 1026034340.60
Non-current liabilities 274828323.33 78488218.15 93489376.79 273342965.71 94170459.07 128586258.43
Total liabilities 1405635319.05 473790018.09 738114901.96 871345914.75 1241235476.37 529948314.54 724350582.67 1154620599.03
Non-controlling
270016655.60233793554.49
interests
Equity attributable to
shareholders of 1726776461.85 593108821.08 54094536.34 1268842371.48 1649773479.59 551672320.38 66824554.28 1095104822.60
parent company
Share of net assets
calculated by 604371761.65 246436715.16 22476279.85 253768474.30 577420717.85 229219849.12 27765602.30 219020964.51
shareholdings
Adjustment -900.00 -5434691.52 116569111.62 -900.00 -1212232.10 116569111.62
--Goodwill 116569111.62 116569111.62
--Unrealized profit of
-17297.08-1212232.10
internal transaction
--Others -900.00 -5417394.44 -900.00
Book value of equity
investment in 604371761.65 246435815.15 17041588.33 370337585.91 577420717.85 229218949.11 26553370.21 335590076.13
associates
Revenue 3938341881.82 1874643211.60 2580371133.61 5050838357.48 4146152397.83 2169675699.57 2785734022.15 5473394399.20
Net profit 97108329.66 41436500.70 -49430017.94 231743304.61 84333018.06 31219889.35 -101993039.29 -225676244.78
Total comprehensive
97108329.6641436500.70-49430017.94231743304.6184333018.0631219889.35-101993039.29-225676244.78
income
Dividends received
from associates 5390000.00 5000000.00 10780000.00 6232950.00
during the period
231 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
C.Summarized financial information for insignificant joint ventures and associates
RMB
20242023
Joint ventures:
Book value of investment 11669191.54 11669191.54
The total amounts calculated based on the shareholding ratio for the following items
--Net profit 5271581.47 -2540981.32
--Other comprehensive income 2024129.06 1595774.57
--Total comprehensive income 7295710.53 -945206.75
Associates:
Book value of investment 2473226163.87 1135582217.35
The total amounts calculated based on the shareholding ratio for the following items
--Net profit 61214934.13 -87789994.31
--Other comprehensive income -2827128.67 5351151.41
--Total comprehensive income 58387805.46 -82438842.90
Note: Unphung Joint Venture Company Nepal Wellhope Agri-tech Pvt. Ltd. Nexus Well-hope Agritech
International Limited use cost method.XI.Government grants
1.Liability items involving government grants
RMB
Financial Amount transferred to
Amount of new grants Related to
statement Opening balance other income in the Closing balance
during the period assets/income
items current period
Deferred
73419574.05 10475552.29 8603571.54 75291554.80 Asset-related
income
Total 73419574.05 10475552.29 8603571.54 75291554.80 /
2.Government grants recognized in profit or loss
RMB
Type 2024 2023
Asset-related 8603571.54 14146133.01
Income-related 40790123.39 68969850.40
Total 49393694.93 83115983.41
XII.Risks Related to Financial Instruments
The risks associated with the Company’s financial instruments arise from various financial assets and
liabilities recognized in the course of its operations including credit risk liquidity risk and market risk.The objectives and policies for managing risks related to financial instruments are formulated by the
Company’s management. The operational management oversees daily risk management through
functional departments (e.g. the Company’s Credit Management Department reviews each credit sale
transaction on a case-by-case basis). The Company’s Internal Audit Department conducts ongoing
oversight of the implementation of risk management policies and procedures and promptly reports
relevant findings to the Company’s Audit Committee.The overall objective of the Company’s risk management is to formulate risk management policies that
232 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
minimize risks associated with financial instruments to the greatest extent possible without unduly
compromising the Company’s competitiveness and flexibility.
1. Credit Risk
Credit risk refers to the risk that a party to a financial instrument fails to fulfill its obligations resulting
in financial losses for the other party. The Company’s credit risk primarily arises from financial assets
such as monetary funds notes receivable accounts receivable financing of receivables other
receivables contract assets debt investments and long-term receivables. The credit risk of these
financial assets stems from counterparty default with the maximum exposure to credit risk equal to
the carrying amount of these instruments.The Company’s monetary funds are primarily deposited with financial institutions such as commercial
banks which the Company considers to have strong reputations and sound asset positions resulting in
low credit risk.For notes receivable accounts receivable financing of receivables other receivables contract assets
debt investments and long-term receivables the Company has established policies to control credit risk
exposure. The Company assesses customers’ creditworthiness based on their financial condition the
availability of guarantees from third parties credit history and other factors such as current market
conditions and sets appropriate credit periods. The Company regularly monitors customers’ credit
records; for customers with poor credit records it adopts measures such as written reminders
shortening credit periods or canceling credit periods to ensure that its overall credit risk remains
controllable.A. Criteria for assessing significant increases in credit risk
The Company assesses at each balance sheet date whether the credit risk of relevant financial
instruments has significantly increased since initial recognition. When making this assessment the
Company considers reasonable and supportable information obtainable without incurring undue cost
or effort including qualitative and quantitative analysis based on its historical data external credit
ratings and forward-looking information. The Company evaluates financial instruments on an individual
basis or in portfolios with similar credit risk characteristics comparing the risk of default at the balance
sheet date with that at initial recognition to determine changes in the expected default risk over the
instrument’s lifetime.The Company deems a significant increase in credit risk to have occurred when one or more
quantitative or qualitative criteria are triggered: the quantitative criterion is primarily a specified
threshold increase in the probability of default over the remaining life at the reporting date compared
to initial recognition; qualitative criteria include significant adverse changes in the debtor’s operating or
financial condition placement on a watch list etc.B. Definition of credit-impaired assets
To determine whether credit impairment has occurred the Company uses criteria consistent with its
233 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
internal credit risk management objectives for the relevant financial instruments considering both
quantitative and qualitative indicators.When assessing whether a debtor has suffered credit impairment the Company primarily considers the
following factors: the issuer or debtor is experiencing significant financial difficulties; the debtor has
breached the contract (e.g. defaulting on or being overdue in paying interest or principal); the creditor
has granted concessions to the debtor that would not otherwise be made due to economic or
contractual considerations related to the debtor’s financial difficulties; the debtor is likely to file for
bankruptcy or undergo other financial restructuring; the active market for the financial asset has
ceased to exist due to the issuer’s or debtor’s financial difficulties; a financial asset was purchased or
originated at a significant discount that reflects the occurrence of credit losses.Credit impairment of a financial asset may result from the combined effect of multiple events rather
than a single identifiable event.C. Parameters for measuring expected credit losses
Depending on whether credit risk has significantly increased and whether credit impairment has
occurred the Company measures impairment provisions for different assets based on either 12-month
or lifetime expected credit losses. Key parameters for measuring expected credit losses include
probability of default loss given default and exposure at default. The Company has developed models
for these parameters based on quantitative analysis of historical data (e.g. counterparty ratings types
of guarantees and collateral repayment methods) and forward-looking information.Relevant definitions are as follows:
Probability of default: The likelihood that a debtor will fail to fulfill its repayment obligations over the
next 12 months or the remaining lifetime of the asset.Loss given default: The Company’s estimate of the extent of loss from exposure to default varying by
counterparty type recourse method and priority and collateral type. It is expressed as a percentage of
the exposure lost at default calculated over a 12-month period or the asset’s lifetime.Exposure at default: The amount the Company is entitled to receive in the event of default over the
next 12 months or the asset’s remaining lifetime. Assessments of significant increases in credit risk and
calculations of expected credit losses both incorporate forward-looking information. The Company
identifies key economic indicators affecting credit risk and expected credit losses for each business type
through historical data analysis.The maximum credit risk exposure borne by the Company is the carrying amount of each financial asset
in the balance sheet. The Company has not provided any other guarantees that could expose it to credit
risk.Among the Company’s accounts receivable the top five customers account for 12.48% of total
receivables; among other receivables the top five counterparties by outstanding amount account for
48.18% of total other receivables.
234 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
2. Liquidity Risk
Liquidity risk refers to the risk of insufficient funds when fulfilling obligations settled by delivering cash
or other financial assets. The Company centralizes cash management across its subsidiaries including
short-term investment of surplus cash and arranging loans to meet projected cash needs. Its policy is to
regularly monitor short- and long-term working capital requirements and compliance with loan
agreements to ensure adequate cash reserves and readily realizable marketable securities are
maintained.As of December 31 2024 the maturity of the Company's financial liabilities is as follows:
RMB
Closing fair value
Item
Within 1 year 1-2 years 2-3 years Over 3 years
Short-term borrowing 567278990.41
Accounts payable 1629553678.79
Other payables 628259826.01
Current portion of non-current liabilities 497542789.55
Long-term borrowings 291197052.25 881346000.00 271611216.09
Bonds payable 1349079789.00
Lease liabilities 51404642.90 48314691.46 321126263.90
Long-term payables 25340254.10 25340254.10 44187215.67
Total 3322635284.76 367941949.25 955000945.56 1986004484.66
3. Market risk
A. Foreign exchange risk
The Company’s foreign exchange risk primarily arises from foreign currency-denominated assets and
liabilities held by the Company and its subsidiaries that are not in their respective functional currencies.The Company’s exposure to foreign exchange risk is mainly related to amounts denominated in Hong
Kong dollars and US dollars. Except for the Company’s Singapore-based subsidiary which uses US
dollars RMB or Singapore dollars for pricing and settlement the Company’s other core operations are
priced and settled in RMB.The Company closely monitors the impact of exchange rate fluctuations on its foreign exchange risk. To
date the Company has not adopted any measures to mitigate foreign exchange risk. However
management is responsible for monitoring such risk and will consider hedging material foreign
exchange exposures when necessary.B. Interest rate risk
The Company’s interest rate risk primarily stems from long-term interest-bearing liabilities such as
long-term bank borrowings and bonds payable. Floating-rate financial liabilities expose the Company to
cash flow interest rate risk while fixed-rate financial liabilities expose it to fair value interest rate risk.The Company determines the relative proportion of fixed and floating-rate contracts based on
prevailing market conditions.The finance department at the Company’s headquarters continuously monitors interest rate levels
across the group. A rise in interest rates would increase the cost of new interest-bearing liabilities and
235 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
the interest expense on outstanding floating-rate interest-bearing liabilities which could have a
material adverse impact on the Company’s financial performance. Management will make timely
adjustments in response to the latest market conditions.XIII.Disclosure of Fair Value
1.Closing fair value of assets and liabilities measured at fair value
RMB
Closing fair value
Item Level 1 fair value Level 2 fair value Level 3 fair value
Total
measurement measurement measurement
Continuing fair value measurement
Trading financial assets 904884.08 904884.08
A. Financial assets measured at fair value
904884.08904884.08
with changes recognized in profit or loss
Derivative financial assets 2441832.40 2441832.40
Investments in other equity instruments 163722.78 163722.78
Total assets measured at continuing fair
3346716.48163722.783510439.26
value
2.Basis for determining market prices of items measured at fair value (Level 1) for both continuing
and non-continuing measurements
For financial instruments traded in active markets the Company measures them using unadjusted
quoted prices for identical assets or liabilities in active markets as of the balance sheet date.
3.Valuation method and qualitative and quantitative information about significant inputs for items
measured at fair value (Level 3) for both continuing and non-continuing measurements
The Company’s investments in other equity instruments represent equity investments over which the
Company has no control joint control or significant influence and for which there are no quoted prices
in active markets. These investments are measured based on the Company’s reasonable estimates
which incorporate the cost of investment and the operating performance of the investee.
4.Other
For financial instruments traded in active markets the Company determines their fair value using
quoted prices in such active markets. For financial instruments not traded in active markets the
Company uses valuation techniques to determine their fair value. The primary valuation models used
include discounted cash flow models and market comparable company models. Inputs to these
valuation techniques mainly include risk-free rates benchmark interest rates exchange rates credit
spreads liquidity premiums and illiquidity discounts.XIV.Related Party and Transaction
1.Information about the Company’s subsidiaries
Details of the Company’s subsidiaries are set out in Note – Interests in other entities.
2.Information about the Company’s joint ventures and associates
Details of the Company’s significant joint ventures or associates are set out in Note – Interests in other
entities.Other joint ventures or associates that entered into related party transactions with the Company during
236 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
the current period or with whom balances arose from related party transactions in prior periods.Name of joint ventures or associates Relationship
Unphung Joint Venture Company Joint venture
Nepal Wellhope Agri-tech Pvt. Ltd. Joint venture
Anshan Fengsheng Food Company Associate
Dalian Wellhope Fishmeal Company Associate
Daqing Supply and Marketing Wellhope Animal Husbandry Company Associate
Dandong Wellhope Chengsan Animal Husbandry Company Associate
Dandong Wellhope Chengsan Food Company Associate
Gongzhuling Wellhope Corn Purchasing and Storage Company Associate
Huludao Jiuguhe Food Company Associate
Huludao Jiuguhe Feed Company Associate
Huludao Jiuguhe Animal Husbandry Company Associate
Jinzhou Jiufeng Food Company Associate
Lankao Tiandi Duck Industry Company Associate
Linghai Jiuguhe Feed Company Associate
Qingdao Shenfeng Animal Husbandry Company Associate
Shenyang Wenjie Bio-tech Company Associate
Shihaipu (Beijing) Commerce & Trade Company Associate
Tai’an Fengjiu Animal Husbandry Company Associate
Tai’an Jiufeng Animal Husbandry Company Associate
Shenyang Zhongwenjie Bio-tech Company Associate
Liaoning Mubang Livestock Equipment Manufacturing Company Associate
Dalian Sida Food Company Associate
Wudalianchi Shengda Pasture Professional Cooperative Associate
Shandong Fengkang Food Company[Note 1] Associate
Anshan Jiuguhe Paper Packaging Co. Ltd. Associate
Anshan Antai Plastic Products Co. Ltd. Associate
Harbin Wei’erhao Trade Company Associate
Jiyuan Sunshine Rabbit Industry Technology Company Associate
Wudalianchi Zhongwang Dairy Cattle Breeding Farmers Professional
Associate
Cooperative[Note 2]
Hebei Taihang Wellhope Animal Husbandry Company Associate
Dazhou Wellhope Bio-tech Company [Note 3] Associate
Suizhong Renhe Fishery Company[Note 4] Associate
Hebei Taihang Wellhope Feed Company Associate
Jilin Jinfeng Animal Husbandry Company Associate
Liaoning Petmate Bio-tech Company Associate
Tai’an Huijun Biomass Energy Company Associate
Fuyu Fengyuan Poultry and Egg Company Associate
Liaoning Xinjuntong Logistics Technology Company Associate
Chongqing Kuizhou Rabbit Industry Company Associate
Shenyang Wanlitian Agriculture and Animal Husbandry Company Associate
Jilin Hengfeng Animal Health Products Company Associate
Dunhua Fengda Broiler Breeding Company Associate
237 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Liaoning Yufeng Bio-tech Company Associate
Chongqing Dahong Agriculture and Animal Husbandry Equipment Company Associate
PT Mulia Harvest Agritech in Indonesia Associate
Shenyang Wellhope Huahu Food Technology Company Associate
Beijing Dahong Hengfeng Animal Husbandry Technology Company Associate
Dalian Minglu Agricultural Development Company Associate
Indonesia Godaji International Trade Company Associate
PT Sekar Golden Harvesta Indonesia Associate
Golden Harvesta Inc. Associate
Other explanation:
[Note 1] In November 2024 the Company purchased 11.00% equity interest in Shandong Fengkang
Food Company. After the purchase its shareholding ratio in Shandong Fengkang Food Company
reached 60.00% and the said company was reclassified from an associated enterprise to a subsidiary
within the consolidation scope.[Note 2] In February 2024 Heilongjiang Bei'an Agricultural Reclamation Zhongwang Dairy Cattle
Breeding Professional Cooperative was renamed Wudalianchi Zhongwang Dairy Cattle Breeding
Farmers Professional Cooperative.[Note 3] In September 2024 the Company purchased 5.00% equity interest in Dazhou Wellhope
Bio-tech Company. After the purchase its shareholding ratio in Dazhou Wellhope Bio-tech Company
amounted to 40.00%. The Company as the sole largest shareholder of Dazhou Wellhope Bio-tech
Company with a 40.00% shareholding has entered into a concerted action agreement with Pu
Guisheng a minority shareholder holding 26.85% of the equity interest thereby becoming a concert
party. The Company thus exercises control over Dazhou Wellhope Bio-tech Company and the said
company was reclassified from an associated enterprise to a subsidiary within the consolidation scope.[Note 4] In April 2024 the Company transferred 60.00% equity interest in Suizhong Renhe Fishery
Company. After the transfer its shareholding ratio in Suizhong Renhe Fishery Company decreased to
30.00% and the said company was reclassified from a subsidiary within the consolidation scope to an
associated enterprise.
3.Other related parties information
Related party Relationship
Controlling shareholder natural
person shareholders who hold
5% or more of the shares of the
Related natural persons
Company directors supervisors
senior management personnel
and their relatives
Shareholder of the Company
Changzhou Heli Venture Capital Partnership (Limited Partnership) holds more than 5% shares of
this company
238 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
4.Related party transaction
A.Related party transactions involving the purchase and sale of goods and the provision and receipt
of services
Schedule of purchases of goods and receipt of services
RMB
Relate party Transaction 2024 2023
Dalian Wellhope Fishmeal Company Feed raw materials 67875835.50 95952015.50
Hebei Taihang Wellhope Animal Husbandry
Live broiler 201097277.52 188958399.61
Company
Harbin Wei’erhao Trade Company Feed raw materials 18671525.19 33344376.52
Tai’an Jiuguhe Agricultural Development Feed products live
32524555.3432065105.21
Company broiler
Daqing Supply and Marketing Wellhope
Feed raw materials 29703469.35
Animal Husbandry Company
Huludao Jiuguhe Animal Husbandry
Live broiler 41159188.40 25242539.20
Company
Gongzhuling Wellhope Corn Purchasing and
Feed raw materials 13056253.87 24172617.21
Storage Company
Liaoning Yufeng Bio-tech Company Feed raw materials 56469023.33 17246305.00
Tai’an Fengjiu Animal Husbandry Company Day old chicks 37533159.08 14710134.17
Dalian Chengsan Food Group Company Live broiler 152794701.21 153646805.96
Anshan Jiuguhe Food Company Broiler products 10797153.93 6498786.23
Zhangjiakou Wellhope Agriculture and
Piglets 5062309.70
Animal Husbandry Company
Jinzhou Jiufeng Food Company Broiler products 18432250.73 4420827.00
Feed products live
Linghai Jiuguhe Feed Company 724376.08 4040920.50
broiler
Shenyang Wanlitian Agriculture and Animal Veterinary drugs and
7217770.003098058.03
Husbandry Company vaccines
Tailai Wellhope Agriculture and Animal
Piglet 2636965.84
Husbandry Company
Anshan Jiuguhe Paper Packaging Company Others 3185811.81 1735573.27
Shihaipu (Beijing) Commerce & Trade
Others 980933.58 1330066.83
Company
Beipiao Hongfa Food Company Broiler products 11305158.67 18749290.88
Anshan Antai Plastic Products Company Others 747330.60 486454.92
Anshan Fengsheng Food Company Feed raw materials 2747502.34 128000.00
Jilin Hengfeng Animal Health Products
Veterinary vaccines 197400.00 121340.71
Company
Qingdao Shengfeng Animal Husbandry
Feed Products 26311.00
Company
Suizhong Renhe Fishery Company Feed raw materials 12824731.10
Shandong Fengkang Food Company Broiler products 6049339.11
Dazhou Wellhope Bio-tech Company Feed Products 4948436.44
Dunhua Fengda Broiler Breeding Company Day old chicks 2281796.50
Huludao Jiuguhe Food Company Broiler products 426646.84
Jilin Jinfeng Animal Husbandry Company Breeding pigs 911062.00
Liaoning Mubang Livestock Equipment
Others 635600.00
Manufacturing Company
Total / 705594819.17 663376672.64
239 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Schedule of sales of goods and provision of services
RMB
Relate party Transaction 2024 2023
Shandong Fengkang Food Company Live broiler 612196573.91 514871771.15
Dalian Sida Food Company Live broiler 189452312.92 248928031.15
Tai’an Jiuguhe Agricultural Feed raw materials
125126068.14150815000.73
Development Company feed products
Feed raw materials
Huludao Jiuguhe Feed Company 57420833.27 76670460.04
feed products
Anshan Jiuguhe Food Company Live broiler 10550860.27 71655291.80
Harbin Wei’erhao Trade Company Feed raw materials 72337773.19 67956115.31
Feed raw materials
Linghai Jiuguhe Feed Company 56204142.63 50452041.39
feed products
Feed raw materials
Dazhou Wellhope Bio-tech Company 17203634.96 32577628.84
feed products
Daqing Supply and Marketing
Wellhope Animal Husbandry Feed products 27840120.00
Company
Qingdao Shenfeng Animal Husbandry Feed raw materials
14310315.1627213619.91
Company feed products
Tailai Wellhope Agriculture and Feed raw materials
26659659.42
Animal Husbandry Company feed products
Anshan Fengsheng Food Company Live broiler 2082589.11 24410632.68
Broiler products feed
Liaoning Yufeng Bio-tech Company 35491651.90 37574749.79
raw materials
Zhangjiakou Wellhope Agriculture
Feed products 12860535.87
and Animal Husbandry Company
Dandong Wellhope Chengsan Animal Feed raw materials
6460095.888458299.13
Husbandry Company feed products
Nepal Wellhope Agri-tech Pvt. Ltd. Feed products 6420472.15 8027945.95
Wudalianchi Shengda Pasture
Feed products 8411628.70 6863810.90
Professional Cooperative
Dalian Chengsan Food Group Feed raw materials
33313870.9426662190.28
Company veterinary drugs
Huludao Jiuguhe Animal Husbandry
Feed products 906116.80 1865507.10
Company
Shihaipu (Beijing) Commerce & Trade
Other products 1013732.37 1814346.16
Company
Jilin Jinfeng Animal Husbandry
Piglets feed products 122067879.00 1063823.04
Company
Shenyang Wellhope Huahu Food
Others 855864.19
Technology Company
PT Mulia Harvest Agritech in
Feed raw materials 3759473.04 531225.00
Indonesia
Jiyuan Sunshine Rabbit Industry
Other products 256079.61 305367.26
Technology Company
Dalian Wellhope Fishmeal Company Feed raw materials 265486.72 260031.67
Dunhua Fengda Broiler Breeding
Feed Products 378811.47 39000.00
Company
Beipiao Hongfa Food Company Feed raw materials 29944358.23 17918551.87
Dandong Wellhope Chengsan Food 54851.56
Feed raw materials
Company
240 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Shenyang Wanlitian Agriculture and
Feed raw materials 12355408.75
Animal Husbandry Company
Fuyu Fengyuan Poultry and Egg
Pullets feed products 4034088.47
Company
Huludao Jiuguhe Food Company Broiler products 3315876.77
PT Sekar Golden Harvesta Indonesia Feed raw materials 1210503.36
Indonesia Godaji International Trade
Feed raw materials 484553.66
Company
Liaoning Petmate Bio-tech Company Other products 150098.37
Tai’an Fengjiu Animal Husbandry
Other products 7087799.36 965645.86
Company
Lankao Tiandi Duck Industry
Other products 13805.31
Company
Total / 1434281745.98 1446117266.49
1)The related party transactions conducted by the Company are essential for its normal business
operations. The pricing for purchases and sales is based on the comparable uncontrolled price method
determined according to the market prices of similar products.
2)The transaction amounts involving Beipiao Hongfa Food Company Dalian Chengsan Food Group
Company and Hebei Taihang Wellhope Animal Husbandry Company include those of their respective
controlled subsidiaries
B.Related party guarantee
The Company acted as the guarantor
RMB
Whether the
Amount of Guarantee Guarantee
Guaranteed party guarantee has been
guarantee date expiry date
completed
Anhui Wellhope Food April 13
30000000.00 March 5 2029 No
Company 2021
Anhui Wellhope Food March 6
100000000.00 March 5 2029 No
Company 2021
Baicheng Wellhope Animal October 11 October 11
10000000.00 No
Husbandry Company 2024 2028
Baotou Hechen Animal March 29
10000000.00 March 28 2028 No
Husbandry Company 2024
Haicheng Wellhope Animal November October 25
51000000.00 No
Husbandry Feed Company 20 2023 2036
Hebei Taihang Wellhope Food April 28
146000000.00 April 26 2036 No
Company 2023
Lixin Xiangfeng Agriculture and March 14
10000000.00 March 14 2028 No
Animal Husbandry Company 2024
Lixin Xiangfeng Agriculture and October 17 October 16
25000000.00 No
Animal Husbandry Company 2024 2028
Lingyuan Wellhope Animal
30000000.00 July 31 2024 July 30 2030 No
Husbandry Company
Liaoning Expert Trade May 16
230000000.00 May 16 2029 No
Company 2023
Liaoning Expert Trade 252000000.00 February 27 February 26 No
241 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Company 2024 2028
Liaoning Expert Trade June 18
195000000.00 June 12 2025 No
Company 2024
Liaoning Qingyuan Wellhope
August 18
Agriculture and Animal 40800000.00 August 18 2036 No
2023
Husbandry Company
Dalian Heyuan Animal May 31
50000000.00 May 30 2028 No
Husbandry Company 2022
October 28 October 27
Dalian Zhongjia Food Company 60000000.00 No
20222028
Daqing Wellhope Food September September 20
7500000.00 No
Company 25 2024 2028
Daqing Wellhope Food
21920000.00 July 27 2022 July 27 2027 No
Company
Daqing Wellhope Food April 22
17900000.00 April 22 2027 No
Company 2023
C.Loans to related party
RMB
Related Starting Expiry
Loans Note
party date date
Wudalianchi Wudalianchi Shengda Pasture Professional
Shengda Cooperative is an associate of Wellhope. Pursuant
Pasture 4350000.00 to the agreement each member contributes funds
Professional to the cooperative in proportion to their respective
Cooperative shareholding.D.Key management compensation
RMB million
Item 2024 2023
Key management compensation 8.51 8.17
5.Outstanding balances with related parties including receivables and payables
A.Receivables
RMB
Closing balance Opening balance
Item Related party Bad debt Bad debt
Book balance Book balance
provision provision
Accounts Linghai Jiuguhe
16558276.00982549.247649631.00526485.42
Receivable Feed Company
Tai’an Jiuguhe
Accounts Agricultural
26900000.00538000.009044419.00351349.98
Receivable Development
Company
Accounts Anshan Jiuguhe
20000000.00400000.0019904264.00398085.28
Receivable Food Company
Accounts Huludao Jiuguhe
14071620.00287221.304786800.0095736.00
Receivable Feed Company
242 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Dalian Chengsan
Accounts
Food Group 1709690.25 37729.81 432000.00 8640.00
Receivable
Company
PT Mulia Harvest
Accounts
Agritech in 531225.00 10624.50
Receivable
Indonesia
Liaoning Yufeng
Accounts
Bio-tech 4265242.55 85304.85 1427217.50 28544.35
Receivable
Company
Wudalianchi
Accounts Shengda Pasture
15877651.4014790863.7413652578.33273051.57
Receivable Professional
Cooperative
Dazhou
Accounts Wellhope
3984322.8079686.46
Receivable Bio-tech
Company
Jiyuan Sunshine
Accounts Rabbit Industry
251840.005036.80
Receivable Technology
Company
Wudalianchi
Zhongwang
Dairy Cattle
Accounts
Breeding 1333862.00 26677.24
Receivable
Farmers
Professional
Cooperative
Shandong
Accounts
Fengkang Food 95579063.79 1911581.28
Receivable
Company
Accounts Dalian Sida Food
1213980.8624279.62
Receivable Company
Dandong
Wellhope
Accounts Chengsan
12500.00250.00
Receivable Animal
Husbandry
Company
Harbin
Accounts
Wei’erhao Trade
Receivable
Company
Jilin Jinfeng
Accounts Animal
11866680.00245332.804950.0099.00
Receivable Husbandry
Company
Nepal Wellhope
Accounts
Agri-tech Pvt. 1982680.13 39653.60 1941955.26 38839.11
Receivable
Ltd.
243 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
PT Sekar Golden
Accounts
Harvest 145041.00 2900.82
Receivable
Indonesia
Accounts Beipiao Hongfa
109773.702195.47
Receivable Food Company
Fuyu Fengyuan
Accounts
Poultry and Egg 2993340.97 59866.82
Receivable
Company
Qingdao
Accounts Shenfeng Animal
5400.00540.00
Receivable Husbandry
Company
Tai’an Fengjiu
Accounts Animal
2006.0040.12
Receivable Husbandry
Company
Wudalianchi
Other Shengda Pasture
4350000.004350000.004350000.004350000.00
Receivables Professional
Cooperative
Lankao Tiandi
Other
Duck Industry 30000.00 3000.00
Receivables
Company
Dalian Wellhope
Prepayments Fishmeal 1926759.00 303360.00
Company
Harbin
Prepayments Wei’erhao Trade 900010.10
Company
Liaoning Yufeng
Prepayments Bio-tech 221508.00
Company
B.Payables
RMB
Closing book Opening book
Item Related party
balance balance
Accounts Payable Anshan Jiuguhe Food Company 3000000.00 717216.00
Accounts Payable Qingdao Shenfeng Animal Husbandry Company 1200000.00 5100000.00
Accounts Payable Shihaipu (Beijing) Commerce & Trade Company 17600.00 5760.00
Accounts Payable Tai’an Fengjiu Animal Husbandry Company 1773102.85 372855.52
Gongzhuling Wellhope Corn Purchasing and Storage
Accounts Payable 1120700.48
Company
Accounts Payable Liaoning Yufeng Bio-tech Company 22347.00 5455770.00
Accounts Payable Anshan Jiuguhe Paper Packaging Company 314510.87 481347.54
Accounts Payable Anshan Antai Plastic Products Company 134527.97 185909.80
Accounts Payable Dalian Wellhope Fishmeal Company 818950.50 2141448.09
244 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Shenyang Wanlitian Agriculture and Animal Husbandry
Accounts Payable 2205120.00 1203434.00
Company
Accounts Payable Harbin Wei’erhao Trade Company 102220.00 5100.00
Accounts Payable Tai’an Jiuguhe Agricultural Development Company 3932445.00
Accounts Payable Jilin Hengfeng Animal Health Products Company 10400.00
Accounts Payable Jinzhou Jiufeng Food Company 3000000.00
Accounts Payable Huludao Jiuguhe Animal Husbandry Company 261721.60 4092604.40
Accounts Payable Beipiao Hongfa Food Company 375247.71
Accounts Payable Dalian Chengsan Food Group Company 1573344.50
Accounts Payable Hebei Taihang Wellhope Animal Husbandry Company 2705960.48
Liaoning Mubang Livestock Equipment Manufacturing
Accounts Payable 584659.26
Company
Accounts Payable Suizhong Renhe Fishery Company 5300.00
Contract
Tai’an Jiuguhe Agricultural Development Company 1166984.40
Liabilities
Contract Liability Huludao Jiuguhe Feed Company 399300.00 878754.45
Contract Liability Harbin Wei’erhao Trade Company 1481023.88 1721140.00
Contract Liability Nepal Wellhope Agri-tech Pvt. Ltd. 38700.00
Contract Liability Liaoning Yufeng Bio-tech Company 6.50
Contract Liability Linghai Jiuguhe Feed Company 141250.00 593368.16
Contract
Shenyang Wellhope Huahu Food Technology Company 15947.96
Liabilities
Other Payables Unphung Joint Venture Company 71682.43 71682.43
Other Payables Nepal Wellhope Agri-tech Pvt. Ltd. 2999.41 2999.41
Liaoning Mubang Livestock Equipment Manufacturing
Other Payables 118732.00
Company
Chongqing Dahong Agriculture and Animal Husbandry
Other Payables 28906.80
Equipment Company
Beijing Dahong Hengfeng Animal Husbandry
Other Payables 9960.00
Technology Company
XV.Share-based payment
1.Equity instruments
Shares granted during the
period
Category
Quantity
Amount(RMB)
(Shares)
Directors (excluding independent directors) Supervisors Senior
Executives Middle Management and Core Technical/Business 14000000.00 72100000.00
Personnel
Total 14000000.00 72100000.00
Outstanding stock options or other equity instruments at the end of the period
Outstanding other equity
Category
instruments
Directors (excluding independent directors) Supervisors Senior
Exercise Remaining
Executives Middle Management and Core Technical/Business
price contract term
Personnel
Total RMB 5.15 32 months
245 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
2.Equity-settled share-based payment
RMB
Method for determining the fair value of equity
Closing price on the grant date
instruments on the grant date
Key parameters for fair value determination of Closing price on the grant date and the grant price under
equity instruments on the grant date the incentive plan
Basis for determining the number of vested It is expected that the vesting conditions will be met in
equity instruments which case all grantees will become eligible to exercise
Cumulative amount of equity-settled
share-based payments recognized in capital 1970110.99
reserve
3.Share-based payment expenses
RMB
Equity-settled share-based
Category
payment expenses
Directors (excluding independent directors) Supervisors Senior
Executives Middle Management and Core Technical/Business 1970110.99
Personnel
Total 1970110.99
XVI.Commitments and Contingencies
1. Contingencies
Significant contingencies existing at the balance sheet date
In November 2024 the Company acquired an additional 11.00% equity interest in Shandong Fengkang
Food Company(hereinafter referred to as “Shandong Fengkang”) increasing its shareholding to 60.00%.As a result Shandong Fengkang changed from an associate to a subsidiary included in the Company’s
consolidated financial statements.Prior to the acquisition Shandong Fengkang provided guarantees for bank loans obtained by Yantai
Laiyang Runze Broiler Breeding Company and five individual farmers. After Shandong Fengkang became
a controlled subsidiary of the Company the guarantees it had previously provided for Yantai Laiyang
Runze Broiler Breeding Company and the individual farmers were passively assumed by the Company
through its subsidiary.As of December 31 2024 the total amount of guarantees borne by the Company was RMB
21500000.00. As of the date of this report all related guarantees have been fully released.
XVII.Subsequent Events
1.Significant non-adjusting events
RMB
Impact on financial
Reason why impact
Item Description position and results of
cannot be estimated
operations
Acquisition of partial
equity interests in 13
Significant external
companies including
investment
Anshan Jiuguhe Food
246 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Company from Jin
Tianming Ma Li and Jin
Xin. For further details
please refer to the
explanation below.The Company convened the 9th meeting of the 8th Board of Directors on February 25 2025 and the
first extraordinary general meeting of shareholders in 2025 on March 13 2025. At these meetings the
Proposal on the Acquisition of Equity Interests in Associated Companies Engaged in the Broiler Business
and the Acquisition of Control was approved. It was agreed that the Company would use its own funds
and if necessary self-raised funds to acquire partial equity interests in 13 companies including Anshan
Jiuguhe Food Co. Ltd. from Jin Tianming Ma Li and Jin Xin (hereinafter referred to as the
"counterparties"). These 13 companies (collectively referred to as the "target companies") include:
Anshan Jiuguhe Food Company Anshan Fengsheng Food Company Tai’an Jiuguhe Agricultural
Development Company Tai’an Fengjiu Animal Husbandry Company Huludao Jiuguhe Food Company
Huludao Jiuguhe Feed Company Huludao Jiuguhe Animal Husbandry Company Jinzhou Jiufeng Food
Company Jinzhou Xinfeng Food Company Linghai Jiuguhe Feed Company Liaoning Yufeng Bio-tech
Company Anshan Antai Plastic Products Company and Anshan Jiuguhe Paper Packaging Company. The
base consideration for the transaction amounts to RMB 353.98 million. A price adjustment mechanism
has been established based on the profitability of the target companies during the period from 2025 to
2029.
On March 15 2025 the Company entered into the Equity Transfer Agreement for Thirteen Companies
with the counterparties. The base consideration was determined based on the book value of the target
companies’ net assets as of December 31 2024 multiplied by the acquisition ratio. A price adjustment
mechanism was agreed upon based on the profitability of the target companies from 2025 to 2029.Upon completion of the acquisition the 13 target companies will become the Company’s holding
subsidiaries and will be included in the scope of the Company’s consolidated financial statements. This
transaction does not constitute a related party transaction nor does it constitute a material asset
restructuring as defined by the Administrative Measures for the Material Asset Restructuring of Listed
Companies. It does not involve the issuance of shares and will not result in any change of control over
the Company.As of April 24 2025 the Company had paid the first installment of the equity transfer consideration
totaling RMB 212.39 million to Jin Tianming Ma Li and Jin Xin.
2.Profit Distribution
RMB
Proposed profits or dividends to be distributed 50382920.15
Profits or dividends that have been approved and declared by the review process 50382920.15
247 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
XVIII.Notes to Major Items of the Parent Company's Financial Statements
1.Accounts receivable
A.Categorized by aging
RMB
Aging Closing book balance Opening book balance
Within 1 year 61335910.08 28002017.00
1-2 years 6594477.00 539258.75
2-3 years 450962.50 1058108.00
Over 3 years 18690222.87 30662435.60
Total 87071572.45 60261819.35
248 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B.Categorized by bad debt provision method
RMB
Closing balance Opening balance
Book balance Bad debt provision Book balance Bad debt provision
Category
Provision Book value Provision Book value
Amount Percentage% Amount Amount Percentage% Amount
rate % rate %
Provision for bad
debts on an individual 686300.00 0.79 686300.00 100.00 686300.00 1.14 686300.00 100.00
basis
Provision for bad
debts on a collective 86385272.45 99.21 20471984.41 23.70 65913288.04 59575519.35 98.86 31911884.11 53.57 27663635.24
basis
including:
Aging analysis group 85643499.12 98.36 20471984.41 23.90 65171514.71 59470239.35 98.69 31911884.11 53.66 27558355.24
Other groups 741773.33 0.85 741773.33 105280.00 0.17 105280.00
Total 87071572.45 / 21158284.41 / 65913288.04 60261819.35 / 32598184.11 / 27663635.24
249 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Provision for bad debts on an individual basis:
RMB
Closing balance
Name
Book balance Bad debt provision Provision rate % Reason
Customer 1 312000.00 312000.00 100.00 Uncollectible
Customer 2 200000.00 200000.00 100.00 Uncollectible
Customer 3 174300.00 174300.00 100.00 Uncollectible
Total 686300.00 686300.00 100.00 /
Provision for bad debts on a collective basis:
RMB
Closing balance
Aging
Accounts receivable Bad debt provision Provision rate %
Within 1 year 60594136.75 1253408.74 2.07
1 -2 year 6594477.00 989171.55 15.00
2-3 years 450962.50 225481.25 50.00
Over 3 years 18003922.87 18003922.87 100.00
Total 85643499.12 20471984.41 23.90
C.Bad debt provision
RMB
Fluctuations in current period
Category Opening balance Closing balance
Provision Write-off
Individual 686300.00 686300.00
Portfolio 31911884.11 -2015472.46 9424427.24 20471984.41
Total 32598184.11 -2015472.46 9424427.24 21158284.41
D.Written-off accounts receivable
RMB
Item Amount
Written-off accounts receivable 9424427.24
E.Top five accounts receivable and contract assets
RMB
Percentage of
Closing Closing balance of
total accounts Closing balance
Closing balance of balance of accounts
Name receivable and of bad debt
accounts receivable contract receivable and
contract assets provision
assets contract assets
(%)
126900000.0026900000.0030.89538000.00
216558276.0016558276.0019.02982549.24
314071620.0014071620.0016.16287221.30
47350077.717350077.718.447350077.71
56591531.506591531.507.575236315.90
Total 71471505.21 71471505.21 82.08 14394164.15
2.Other receivables
RMB
Item Closing balance Opening balance
Interests receivable
Dividends receivable 19052119.77 54770301.77
Other receivables 2216033371.63 2289682206.80
Total 2235085491.40 2344452508.57
250 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
A.Dividends receivable
a. Dividends receivable
RMB
Item Closing balance Opening balance
Dividends from long-term investment under cost method 19052119.77 54770301.77
Dividends from long-term investment under equity method
Total 19052119.77 54770301.77
b.Significant dividends receivable aged over one year
RMB
Whether
impairment
Closing Reasons for has occurred
Item(investee) Age
balance non-recovery and the basis
for its
determination
Daqing Wellhope 1-2 years:
Bayi Nongda RMB 10428632.53;
16541119.77 Not yet paid No
Animal Sci-Tech Over 3 years:
Company RMB 6112487.24
Changchun
Wellhope Feed Co. 2511000.00 Over 3 years Not yet paid No
Ltd.Total 19052119.77 / /
B.Other receivables
a.Categorized by aging
RMB
Aging Closing book balance Opening book balance
Within 1 year 2187598080.47 2293011737.14
1-2 years 33463143.00 63143.00
2-3 years 398700.00
Over 3 years 4807900.00 4593700.00
Total 2225869123.47 2298067280.14
b.Categorized by nature
RMB
Nature Closing book balance Opening book balance
General operating receivables 1102229.24 2466112.54
Deposits and margins 382900.00 900526.00
Related party- fund transactions 2186633994.23 2256950641.60
Receivables from disposal of investments 33400000.00 33400000.00
Other 4350000.00 4350000.00
Total 2225869123.47 2298067280.14
251 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
c.Bad debt provision
RMB
Stage 1 Stage 2 Stage 3
Bad debt 12-month Lifetime expected Total
provision Lifetime expected credit expected credit credit loss (not
loss (credit-impaired)
loss credit-impaired)
Balance on
January 1 3850573.34 4534500.00 8385078.34
2024
-Transfer to
stage 2
- Transfer to
stage 3
-Transfer
back to stage
- Transfer
back to stage
1
Provision
made during 1620616.50 457900.00 2078516.50
the period
Reversal
during the 120000.00 120000.00
period
Charged-off
during the
reporting
period
Write-off
during the
443338.0064500.00507838.00
reporting
period
Balance on
December 5027851.84 4807900.00 9835751.84
312024
Basis for stage classification and provision rates for expected credit losses
a.As of December 31 2024 the provision for bad debts was measured based on the three-stage model
as follows:
RMB
Phase Book balance Provision for bad debts Book value
Phase 1 2221061223.47 5027851.84 2216033371.63
Phase 2
Phase 3 4807900.00 4807900.00
Total 2225869123.47 9835751.84 2216033371.63
252 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
b. As of December 31 2023 the provision for bad debts was measured based on the three-stage model
as follows:
RMB
Phase Book balance Provision for bad debts Book value
Phase 1 2293532780.14 3850573.34 2289682206.80
Phase 2
Phase 3 4534500.00 4534500.00
Total 2298067280.14 8385073.34 2289682206.80
d.Bad debt provision
RMB
Fluctuations in 2024
Opening Closing
Category Other
balance Provision Reversal Write-off balance
fluctuations
Other
8385073.342078516.50120000.00507838.009835751.84
receivables
total 8385073.34 2078516.50 120000.00 507838.00 9835751.84
e.Write-off of other receivables during the period
RMB
Item Amount
Other receivables written off 507838.00
f.Top five other receivables
RMB
Percentage of
Closing balance
closing balance
Company Closing balance Nature Aging of bad debt
of other
provision
receivables %
Non-trade
1 280539777.78 12.60 within 1 year
receivables
Non-trade
2 223983412.51 10.06 within 1 year
receivables
Non-trade
3 122193331.57 5.49 within 1 year
receivables
Non-trade
4 113717941.83 5.11 within 1 year
receivables
Non-trade
5 107844398.34 4.85 within 1 year
receivables
Total 848278862.03 38.11 / /
g.Presented in other receivables due to centralized management of funds
RMB
Amounts reported in other receivables due
2186633994.23
to centralized management of funds
Notes /
253 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
3.Long-term equity investment
RMB
Closing balance Opening balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Investment in
4167552015.384167552015.383999638880.613999638880.61
subsidiaries
Investment in
associates and 2335353767.06 17900000.00 2317453767.06 2215440226.01 17900000.00 2197540226.01
joint ventures
Total 6502905782.44 17900000.00 6485005782.44 6215079106.62 17900000.00 6197179106.62
A.Investment in subsidiaries
RMB
Fluctuations in 2024
Company Opening balance Additional Disposals / Closing balance
investment Reductions
Zhejiang Pinghu Wellhope Animal Husbandry Company 1026750.75 1026750.75
Changsha Wellhope Animal Husbandry Company 8300000.00 703.61 8300703.61
Tangshan Wellhope Feed Company 43434466.04 3678918.27 47113384.31
Shulan Fengtai Agriculture and Animal Husbandry Company 63394541.16 1407.22 63395948.38
Daqing Wellhope Food Company 7650000.00 1407.22 7651407.22
Harbin Wellhope Agriculture and Animal Husbandry
1407.221407.22
DevelopmentCompany
Nanchang Wellhope Animal Husbandry Company 6500000.00 1407.22 6501407.22
Haicheng Wellhope Animal Husbandry Feed Company 12614789.85 1407.22 12616197.07
Fuyu Wellhope Taolaizhao Poultry Breeding Company 25757551.60 1407.22 25758958.82
Jiyuan Helai Feed Company 23000000.00 2110.83 23002110.83
Wan’an Wellhope Feed Company 7800000.00 2110.83 7802110.83
Lixin Xiangfeng Agriculture and Animal Husbandry Company 2110.83 2110.83
Lixin Rongfeng Agriculture and Animal Husbandry Company 2110.83 2110.83
Dalian Wellhope Pig Breeding Company 2110.83 2110.83
Datong Hejia Agriculture and Animal Husbandry Company 2110.83 2110.83
Shenyang Wellhope Poultry Industry Company 60565.62 2814.44 63380.06
Shanxi Wellhope Animal Husbandry Company 48042083.51 2814.44 48044897.95
Shenyang Expert Trade Company 30010648.28 2814.44 21800000.00 8213462.72
Heilongjiang Sanjiang Wellhope Animal Husbandry Company 13022410.76 2814.44 13025225.20
Heilongjiang Wellhope Dasenlin Food Company 10200000.00 2814.44 10202814.44
Shenyang Jiahetianfeng Trade Company 10143614.30 2814.44 10146428.74
Gansu Wellhope Animal Husbandry Company 40108690.76 2814.44 40111505.20
Daqing Wellhope Animal Husbandry Company 2814.44 2814.44
Fuzhou Wellhope Xingyuan Animal Husbandry Development
60400000.0012403518.0672803518.06
Company
Baotou Hechen Animal Husbandry Company 15750000.00 3518.06 15753518.06
Cangzhou Helai Technology Company 3531614.46 3518.06 3535132.52
Zhengzhou Wellhope Animal Husbandry Company 12898005.82 3518.06 12901523.88
Dunhua Fengda Agriculture and Animal Husbandry
13095094.634221.6713099316.30
Development Company
Jinan Xinweita Trade Company 157757.98 4221.67 161979.65
Shenyang Wellhope Extruded Feed Company 33042083.51 4221.67 33046305.18
Hengshui Wellhope Feed Company 6400000.00 4221.67 6404221.67
Baicheng Wellhope Animal Husbandry Company 5100000.00 4221.67 5104221.67
Guangzhou Dashang Trade Company 4221.67 4221.67
Shenyang Pufeng Trade Company 7499788.72 4221.67 7504010.39
Anyang Wellhope Agriculture and Animal Husbandry Company 55000000.00 4221.67 55004221.67
Jinzhou Wellhope Animal Husbandry Company 17260917.78 4221.67 17265139.45
Tianjin Wei’erhao Trade Company 4221.66 4221.66
254 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Yunnan Wellhope Feed Company 25082494.77 504925.28 25587420.05
Haicheng Xinzhongxin Feed Company 6002315.70 4925.28 6007240.98
Shijiazhuang Hejia Agriculture and Animal Husbandry Company 13000000.00 5488.17 13005488.17
Jingzhou Wellhope Agriculture Technology Company 21432261.58 21874199.89 43306461.47
Jilin Wellhope Pig Breeding Company 15000000.00 5628.89 15005628.89
Huaian Wellhope Feed Co. Ltd. 30230704.62 5628.89 30236333.51
Zhumadian Wellhope Animal Husbandry Company 9052956.04 5628.89 9058584.93
Jiaozuo Wellhope Feed Company 50704604.92 6332.50 50710937.42
Hainan Expert Trade Company 9151.81 6473.22 15625.03
Anhui Wellhope Food Company 6895.39 6895.39
Tangshan Hejia Agriculture and Animal Husbandry Company 19634667.24 6895.39 19641562.63
Hainan Wellhope Animal Husbandry Company 68155732.34 7036.11 68162768.45
Tangshan Wellhope Technology Company 21033666.81 7036.11 21040702.92
Changchun Wellhope Food Company 8668334.04 7036.11 8675370.15
Qingdao Wellhope Animal Husbandry Company 28887168.30 7036.11 28894204.41
Kaifeng Wellhope Agriculture and Animal Husbandry Company 40348.21 7036.11 47384.32
Dehui Wellhope Animal Husbandry Company 45424.21 7036.11 52460.32
Puyang Wellhope Animal Husbandry Company 45424.21 7036.11 52460.32
Shandong Heyuan Animal Husbandry Company 7036.11 7036.11
Lingyuan Wellhope Animal Husbandry Company 16910917.77 7936.73 16918854.50
Puyang Wellhope Food Company 20210417.56 8302.61 20218720.17
Chifeng Wellhope Animal Husbandry Company 6800000.00 8443.33 6808443.33
Dunhua Wellhope Animal Husbandry Company 7652794.97 8443.33 7661238.30
Liaoning Wellhope Trade Company 30278344.48 8443.33 30286787.81
Liaoning Wellhope Egg Industry Company 8443.33 8443.33
Beijing WellhopeAnimal Husbandry Company 5071980.16 8865.50 5080845.66
Luoyang Wellhope Agriculture and Animal Husbandry Company 75000000.00 8865.50 75008865.50
Liaoning Wellhope Food Company 30041809.18 9146.94 30050956.12
Linyi Helai Animal Husbandry Company 33038762.97 9850.56 33048613.53
Beijing Brilliant Dragon Animal Health Trade Company 205085.39 9850.56 214935.95
Shanghai Hehong Trade Company 203454.84 9850.56 213305.40
Tailai Wellhope Agriculture and Animal Husbandry Company 144179039.25 9850.56 144188889.81
Hebei Taihang Wellhope Food Company 234150000.00 74377172.72 308527172.72
Henan Wellhope Animal Husbandry Company 53071854.64 10554.17 20000000.00 33082408.81
Chifeng Wellhope Fuxinyuan Food Company 125000000.00 11257.78 6000000.00 119011257.78
Guangzhou Xiangshun Animal Husbandry Equipment Company 3000500.21 11257.78 3011757.99
Liaoning Wellhope Agriculture and Animal Husbandry
97604896.3011679.9497616576.24
Development Company
Shenyang Wellhope Aquatic Feed Company 15286167.88 11961.39 15298129.27
Gongzhuling Wellhope Ruminant Feed Company 5084167.03 12665.00 5096832.03
Linyi Wellhope Animal Husbandry Company 15000000.00 12665.00 15012665.00
Daqing Wellhope Bayi Nongda Science and Technology
39221417.7712946.4439234364.21
Company
Dalian Wellhope Feed Company 42386167.87 13087.17 42399255.04
Lankao Tiandi Feed Company 46069798.90 13368.61 46083167.51
Pingyuan Wellhope Food Processing Company 210203167.88 13509.33 210216677.21
Jilin Dalong Wellhope Animal Husbandry Company 4130000.00 14072.22 4144072.22
Haicheng New Hongzunda Animal Husbandry Company 34242841.13 14072.22 34256913.35
Nanyang Wellhope Feed Company 17925324.47 14775.83 17940100.30
Zhangjiakou Wellhope Agriculture and Animal Husbandry
147885081.047014916.56154899997.60
Company
Xingcheng Wellhope Feed Company 82794584.59 16183.06 82810767.65
Changchun Hengfeng Agriculture and Animal Husbandry
235667.6619701.11255368.77
Company
Changchun Wellhope Feed Company 84597782.33 20320.29 84618102.62
Shanghai Wellhope Feed Company 2295632.60 26033.61 2321666.21
Kaifeng Jiufeng Agriculture and Animal Husbandry Company 42000000.00 26189.41 42026189.41
255 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Shenyang Huakang Xinxin Food Company 1969334.47 27581.56 1996916.03
Liaoning Qingyuan Wellhope Agriculture and Animal Husbandry
114694899.2128144.44114723043.65
Company
Beijing Sanyuan Wellhope Animal Husbandry Company 8719369.88 28707.33 8748077.21
Xi'an Wellhope Feed Technology Company 4688849.43 29551.67 4718401.10
Shenyang Wellhope Pig Breeding Company 30677.44 30677.44
Pingyuan Wellhope Animal Husbandry Company 264258.47 31240.33 295498.80
Shenyang Huakang Meat Poultry Company 68558404.83 33829.62 68592234.45
Wellhope Food (Shenyang) Company 5160191.67 35180.56 5195372.23
Shenyang Nongda Wellhope Feed Company 44562397.18 35799.73 44598196.91
Dalian Heyuan Animal Husbandry Company 103890054.30 37432.11 103927486.41
Shenyang Wellhope Animal Husbandry Company 82988342.49 39416.29 83027758.78
Dalian Huakang Xinxin Food Company 11662375.47 43061.00 11705436.47
Shenyang Wellhope Ruminant Feed Company 6038738.05 43820.90 6082558.95
Shenyang Fame Bio-tech Company 20494308.42 44341.57 20538649.99
Gongzhuling Wellhope Animal Husbandry Company 35514907.90 44805.96 35559713.86
Lankao Wellhope Animal Husbandry Company 43084167.03 49956.39 43134123.42
Liaoning Expert Trade Company 73771350.84 61256.38 73832607.22
Liaoning Godaji E-commerce Company 20496378.16 75708.56 20572086.72
Heilongjiang Wellhope Animal Husbandry Company 120848465.45 84574.06 120933039.51
Dalian Zhongjia Food Company 155824.28 182066.41 337890.69
Hunan Wellhope Agriculture and Animal Husbandry Company 49000000.00 49000000.00
Dazhou Wellhope Bio-tech Company 17642857.21 17642857.21
Siping Wellhope Food Company 14000000.00 14000000.00
Hebei New Taihang Wellhope Animal Husbandry Company 10000000.00 10000000.00 20000000.00
Shandong Jiayixiang Agriculture and Animal Husbandry
8000000.008000000.00
Company
Huaibei Wellhope Animal Husbandry Company 6250000.00 6250000.00
Mianyang Wellhope Bio-tech Company 5200000.00 5200000.00
Wellhope E-Commerce (Liaoning) Company 1500000.00 1500000.00
Zhumadian Wellhope Agricultural Development Company 30000000.00 1.00 30000001.00
Jilin Wellhope Animal Husbandry Company 16241715.94 16241715.94
Dalian Wellhope Animal Husbandry Company 37000000.00 600000.00 36400000.00
Russia Wellhope Agri-tech Company 11700000.00 11700000.00
Fuyu Wellhope Egg Poultry Company 5200000.00 5200000.00
Neihuang Wellhope Animal Husbandry Company 60000000.00 60000000.00
Kaifeng Wellhope Meat Food Company 100000000.00 100000000.00
Fuxin Wellhope Agriculture and Animal Husbandry Company 30000000.00 30000000.00
Lingyuan Wellhope Agriculture and Animal Husbandry Company 5000000.00 5000000.00
Siping Huiliang Wellhope Animal Husbandry Company 5100000.00 5100000.00
Heilongjiang Wellhope Dasenlin Animal Husbandry Company 10200000.00 10200000.00
Tianjin Fengyunda Supply Chain Company 10000000.00 10000000.00
Anhui Wellhope Animal Husbandry Company 112148987.28 5628.89 112154616.17
Tai'an Wellhope Feed Company 33055140.93 33055140.93
Qiqihar Wellhope Animal Husbandry Company 7650000.00 7650000.00
Mudanjiang Wellhope Animal Husbandry Company 23286048.10 23286048.10
Fuyu Wellhope Animal Husbandry Company 46602083.51 46602083.51
Daqing Bifeng Animal Husbandry Company 5100000.00 5100000.00
Shandong Heyuan Food Company 37759.87 37759.87
Liaoning Tiandi Breeding Equipment Company 28667982.56 28667982.56
Tongliao Wellhope Tianyi Forage Industry Company 10200000.00 10200000.00
Jining Wellhope Animal Husbandry Company 19726723.27 19726723.27
Shenyang Huaweida Animal Health Products Company 36032.42 36032.42
Chongqing Wellhope Animal Husbandry Company 2230000.00 2230000.00
Zhangwu Wellhope Agricultural Development Company 1800000.00 1800000.00
Suihua Wellhope Animal Husbandry Company 27889500.00 27889500.00
Shenyang Xiangmai E-commerce Company 650000.00 650000.00
256 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Lanxi Fengyuan Agriculture and Animal Husbandry Company 2550000.00 2550000.00
Fame (Shenyang) Biological High-tech Industry Research
10000000.005000000.005000000.00
Institute Company
Total 3999638880.61 233049167.19 65136032.42 4167552015.38
257 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
B.Investment in associates and joint ventures
RMB
Fluctuations in 2024
Gains or losses
Adjustment of Declaring of Closing
on investments Other
Additional Reducting other paying balance of
Company Opening balance recognized changes in Other Closing balance
investment investment comprehensiv dividend or impairment
under equity equity
e income profit provision
method
1.Joint Venture
Unphung Joint Venture
7501575.107501575.10
Company
Nepal Wellhope Agri-tech
4167616.444167616.44
Pvt. Ltd.Nexus Well-Hope Agritech
17900000.0017900000.0017900000.00
International Limited
Subtotal 29569191.54 29569191.54 17900000.00
2. Associated Company
Dalian Chengsan Food
335590076.1339747509.775000000.00370337585.90
Group Company
Beipiao Hongfa Food
577420717.8532341043.805390000.00604371761.65
Company
GOLDEN HARVESTA INC. 118725880.04 27135877.85 -1533053.64 144328704.25
Anshan Jiuguhe Food
229218949.1117216866.04246435815.15
Company
Tai'an Fengjiu Animal
61361547.749500000.0015027004.66760000.0085128552.40
Husbandry Company
Jinzhou Jiufeng Food
98214303.4010452169.84108666473.24
Company
Dandong Wellhope
Chengsan Animal 110101992.66 11142207.25 121244199.91
Husbandry Company
Dandong Wellhope
101348309.008491052.33109839361.33
Chengsan Food Company
Jilin Jinfeng Animal 4496784.48 9000000.00 4202965.13 17699749.61
258 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Husbandry Company
Huludao Jiuguhe Food
34887946.48-8085188.6226802757.86
Company
Lankao Tiandi Duck Industry
33044157.086089245.1239133402.20
Company
Shenyang Zhongwenjie
10358475.964852423.2615210899.22
Bio-tech Company
PT Mulia Harvest Agri-tech
61235381.674473546.46-736758.2664972169.87
in Indonesia
Dunhua Fengda Broiler
5643687.462293469.947937157.40
Breeding Company
Hebei Taihang Wellhope
Animal Husbandry 32966905.71 900000.00 1296150.01 33363055.72
Company
Gongzhuling Wellhope Corn
Purchasing and Storage 40970396.63 993632.22 41964028.85
Company
Anshan Jiuguhe Paper
5636125.211824000.00850956.458311081.66
Packaging Company
Huludao Jiuguhe Feed
1617085.05837464.232454549.28
Company
Jinzhou Xinfeng Food
11164938.36715929.0611880867.42
Company
Liaoning Mubang Livestock
Equipment Manufacturing 12230028.52 561003.17 12791031.69
Company
Anshan Antai Plastic
4256064.48552006.144808070.62
Products Company
Chongqing Kuizhou Rabbit
7544722.253500000.00550521.1611595243.41
Industry Company
Beijing Dahong Hengfeng
Animal Husbandry 23768257.00 373448.81 24141705.81
Company
Liaoning Xinjuntong
Logistics Technology 1140000.00 219145.08 1359145.08
Company
Shihaipu (Beijing) 2195480.34 205853.77 2401334.11
259 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Commerce & Trade
Company
Weifang Wellhope
5440416.5686903.655527320.21
Xinhesheng Feed Company
Tai'an Jiufeng Animal
Husbandry Company
Qingdao Shenfeng Animal
12368636.02-10742.2912357893.73
Husbandry Company
Hainan Wengfeng
Wenchang Chicken Industry 1089591.10 -172387.50 917203.60
(Group) Company
Shenyang Wenjie Bio-tech
13934675.2412000000.00-96285.041838390.20
Company
Shulan Fengtai Organic
1661310.19-134630.631526679.56
Fertilizer Company
Hebei Taihang Wellhope
900000.00-175475.54724524.46
Feed Company
Tai'an Huijun Biomass
509726.28-509726.28
Energy Company
Chongqing Dahong
Agriculture and Animal
11501138.07-1128764.4310372373.64
Husbandry Machinery
Company
PT Sekar Golden Harvesta
34125322.42-1191701.47-537185.3132396435.64
Indonesia
Dazhou Wellhope Bio-tech
14143883.56-1626026.352625000.00-15142857.21
Company
Huludao Jiuguhe Animal
2456236.03-2456236.03
Husbandry Company
Jiyuan Sunshine Rabbit
Industry Technology 12509492.01 -2553290.64 9956201.37
Company
Linghai Jiuguhe Feed
40891596.353420000.00-6678485.2637633111.09
Company
Anshan Fengsheng Food
55295625.46-5452690.3749842935.09
Company
Liaoning Yufeng Bio-tech 16280236.96 -6735576.94 9544660.02
260 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
Company
Bei'an Agricultural
Reclamation Shengda
11134388.17-11134388.17
Pasture Professional
Cooperative
Tai'an Jiuguhe Agricultural
27765602.3115249951.00-25973964.9817041588.33
Development Company
Heilongjiang Bei’an
Agriculture Reclamation
Zhongwang Dairy Cattle 764945.13 764945.13
Breeding Professional
Cooperative
Subtotal 2185871034.47 44533951.00 12900000.00 116592834.67 -2806997.21 2625000.00 12988390.20 -15142857.21 2305784575.52
Total 2215440226.01 44533951.00 12900000.00 116592834.67 -2806997.21 2625000.00 12988390.20 -15142857.21 2335353767.06 17900000.00
261 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
4.Revenue and cost
A.Information of revenue and cost
RMB
20242023
Item
Revenue Cost Revenue Cost
Revenue from primary
675678445.71506895695.24712023965.19538367572.22
businesses
Revenue from other
6371688.732949936.404103206.07308708.86
businesses
Total 682050134.44 509845631.64 716127171.26 538676281.08
B.Split of revenue and cost
RMB
Total
Contract classification
Revenue Cost
Type of goods
Feed products 675678445.71 506895695.24
Other businesses 6371688.73 2949936.40
Classified by timing of transfer of goods
Revenue recognized at a point in time 680039649.50 509636034.28
Revenue recognized over time 2010484.94 209597.36
Classified by sales channel
Direct sales 6371688.73 2949936.40
Distribution sales 675678445.71 506895695.24
Total 682050134.44 509845631.64
Explanation:
The Company sells feed products feed raw materials broiler products commercial pigs and other
goods. In accordance with the terms of the sales contracts these transactions are considered
performance obligations satisfied at a point in time. For such obligations revenue is recognized when
control of the goods is transferred to the customer. The Company’s asset leasing business is deemed to
satisfy performance obligations over time as stipulated in the lease contracts. For these obligations
revenue is recognized over time based on the progress of performance during the lease period.
5.Income from investment
RMB
Item 2024 2023
Income from long-term equity investments under cost method 60863493.36 155233214.54
Income from long-term equity investments under equity method 117945879.18 -118923656.51
Investment income from disposal of long-term equity investments -11591131.17 -17936406.61
Investment income from disposal of derivative financial
6844.16-1455012.74
instruments etc.Investment income from financial assets held for trading 100273.97
Total 167225085.53 17018412.65
262 / 263Wellhope Foods Co. Ltd. 2024 Annual Report
XIX.Supplementary Information
1.Extraordinary items in 2024
RMB
Item Amount Note
Gains or losses from the disposal of non-current assets
including the reversal of impairment provisions previously -12802784.26
recognized
Government grants recognized in profit or loss for the period
excluding those closely related to the Company’s ordinary
business granted in accordance with national policies based 40790123.39
on established criteria and having a sustained impact on the
Company’s profit or loss
Gains or losses arising from changes in the fair value of
financial assets and financial liabilities held by non-financial
enterprises and from the disposal of such assets and -2489576.88
liabilities excluding effective hedging activities related to the
Company’s ordinary business
Reversal of impairment losses on individually assessed
1288016.75
receivables
Other non-operating income and expenses not included in
-26982020.11
the items listed above
Other items that meet the definition of non-recurring gains or
655040.54
losses in accordance with applicable accounting standards
Less: Income tax effects 3049188.70
Non-controlling interests effects(net of tax) 4422821.56
Total -7013210.83
2.Return on equity and earnings per share
Weighted average Earnings per share
Profit in 2024
ROE % Basic EPS Diluted EPS
Net profit attributable to ordinary
5.060.380.38
shareholders of the Company
Net profit attributable to ordinary
shareholders of the Company after deducting 5.17 0.39 0.38
non-recurring gains and losses
Chairman: Jin Weidong
Date of Board approval for submission: April 26 2025
沪公网安备31011802005267号
