Zhitong Finance App News, China Financial Development (03623) announced that the Group's earnings for the year ended December 31, 2023 will decrease by about 75% to 79% compared to 2022, and losses during the reporting period will be reduced by about 42% to 48% compared to losses achieved in 2022. The main reasons for the change in performance during the reporting period are as follows: (i) the Group's net guarantee fee revenue declined compared to 2022, mainly because the Group adopted a “risk first, business second” business strategy during the reporting period, strictly controlled risk, and selectively carried out traditional guarantee business, compounded the impact of changes in the product structure of partner institutions, which reduced the overall business compared to 2022; and (ii) market pig sales declined sharply compared to the same period in 2022, mainly due to the intensification of the high supply and weak demand situation in the pig market during the reporting period. Actively reduce pig production to minimize losses.
The main reasons for the reduction in losses during the reporting period include: (i) the Group's impairment loss reserve calculation was drastically reduced compared to 2022, mainly due to the recovery of accounts receivable with a long period of time that had already been prepared during the reporting period; (ii) the Group's operating expenses during the reporting period were reduced compared to 2022, mainly due to a reduction in the number of pigs phased out; (iii) the Group had repaid most of the principal amount of convertible bonds according to the repayment plan by the end of the reporting period, and (iv) the Group's interest expenses were significantly reduced compared to 2022; and (iv) the Group measured its interest expenses at fair value during the reporting period and its fluctuation meter Net income is obtained from changes in the fair value of financial assets recorded in current profit and loss.
Despite this, the Group's cash flow and financial position remain stable to meet business needs. The decline in the Group's earnings during the reporting period was narrower than the rate of decline in earnings disclosed in the 2023 Interim Report. The reason is: (i) the Group's project with the Chinese trading market was launched in the second half of 2023; and (ii) the Group has cooperated with professional energy storage R&D companies to develop safe, environmentally friendly, efficient and stable industrial and commercial energy storage systems for overseas customers.
In addition, the Group's pig farm has completed biosafety assessments and modifications to improve breeding quality and efficiency, and production has gradually resumed.