(Yicai Global) July 18 -- Guangdong Wens Foodstuff Group Co. [SHE:300498], a fresh meat supplier with the largest market cap on China's Growth Enterprise Market, is struggling with an ongoing share sell-off after falling pig prices and a bird flu epidemic saw it lower its first half net profit forecast by 73.7 to 77.9 percent.
Share prices were down 7.01 percent to CNY21.75 (USD3.22) at close on July 14 and fell a further 8.14 percent to CNY19.98 on Monday. The current price is more than 40 percent below its peak, which hit CNY50.49 the day after the firm went public in November 2015.
In the first six months, Wens Foodstuff posted 11.5 percent growth in pig sales from the same period a year earlier, with pigs weighing an average of 4.98 kilograms more, according to its revised earnings report on July 14. However, changes in supply and demand conditions saw the average sale price dive nearly 20 percent and significantly reduce profits.
The average price of a pig fell 33.9 percent on the year to CNY13.65 a kilogram last month, the company said previously.
This year's first quarter also saw China's worst outbreak of the deadly H7N9 bird flu, with 79 deaths reported in January alone. The sudden spread of the virus led to the closure of poultry markets in at least six provinces.