What happened
Dongrui Co. (001201) released its 2026 semi-annual report on August 28, showing a net loss attributable to shareholders of 425 million yuan on operating revenue of 1.04 billion yuan, down 5.1% year-on-year. The company attributed the loss mainly to a sharp year-on-year drop in hog prices during the first half.
The company sold 886,000 pigs in H1 2026, up 15.82% year-on-year, but pig sales revenue fell 5.99% to 1.003 billion yuan. The average selling price of commercial pigs was 11.41 yuan per kilogram, down 27.62% year-on-year. Pig farming revenue reached 990 million yuan while operating costs came to 1.062 billion yuan, resulting in a gross margin of -7.28%.
The company also recorded impairment provisions totaling 118 million yuan, mainly for consumable biological assets, citing lower hog prices. The impairment represented 27.85% of its total pre-tax loss, further dragging down the period's results.
Why it matters
The results show how sharply the hog price downturn is squeezing even companies that expand sales volume: selling more pigs did not offset lower prices, and the negative gross margin shows the core business is selling below cost.
Dongrui has now fallen into heavy losses again after posting losses in 2024 and 2025, and its debt-to-asset ratio climbed from 46.68% at the end of 2025 to 52.88% by the end of June 2026, signaling growing financial strain amid continued losses.
Key facts
H1 2026 net loss attributable to shareholders was 425 million yuan, down 12,899.5% year-on-year.
Revenue was 1.04 billion yuan, down 5.1% year-on-year, while operating cash flow was -138 million yuan.
Pig sales volume rose 15.82% to 886,000 head, but commercial pig selling prices fell 27.62% to 11.41 yuan per kilogram.
The company made 118 million yuan in impairment provisions for consumable biological assets, equal to 27.85% of its total pre-tax loss.
Total assets stood at 5.95 billion yuan at end-June 2026, down 1.8% from year-end 2025, with net assets down 14.6%.
What to watch next
Whether hog prices stabilize in the second half of the year will be critical, as Dongrui's performance remains highly sensitive to price swings and its operating cash flow is already negative.
Investors may also track the company's cost controls and inventory impairment levels, as well as its leverage trajectory after the debt-to-asset ratio rose to 52.88%.