After experiencing escalating global tensions since more than two years ago, the Group is delighted to see the signing of the first phase of the trade agreement between China and the US in early 2020. While uncertainties remain regarding the second-phase negotiations, the improving relations between the two countries has given positive signals for the global economy. That plus the stability of the price of oil and the RMB exchange rate as well as retreat of interest rate hikes, the management is cautiously optimistic about the Group’s long-term development in the future.
The Group's factories have been extended their holidays due to the new coronavirus outbreak, but they have resumed work already. As for business development, the Group expects customers to start replenishing inventory, which is believed would spur the placing of more orders. The Group will also cooperate with new technology providers in the second half of the year to jointly invest in the research and development of innovative environmental protection technologies to develop more high quality and value-added products, thereby consolidating its industry-leading position. In addition, the Group will continue to expand its customer base, open up new income sources, explore markets and regions rich with potential, actively extend its reach to international brands while it develops high value-added and high margin 5G and smart home products.
On top of producing conventional home appliances and maintaining stable relations with large toy companies, the Group has stepped up direct liaison with end-customers and put more resources into prospecting for end-customers of sanitary products, matching the country’s policy to promote the domestic consumption market. The Group has also strengthened the development of food contact products, including setting up dedicated production and packaging workshops and investing in a specialised water cooling system to gain the confidence of customers with a high sanitary requirement on colour masterbatches. Through these measures, the Group aims to promote sales to the food, drugs and cosmetics industries.
As for cost controls, the Group will continue to implement strict cost control measures, including cutting administrative, distribution and production costs. It will also strive to raise overall administrative efficiency through sharing of internal resources so as to realise greater synergies in its operations. Furthermore, the Group will pay close attention to the development of the pandemic and make corresponding preparations and measures to ensure the safety of employees.
This year marks Ngai Hing Hong’s 50th anniversary. The Group has been able to sustainably grow thanks to the dedication of the professional management team, leading the Group to overcome a variety of challenges over the years. As always, the Group will apply its business strategy with the objective of achieving strong and stable growth while engaging in prudent financial management with the ultimate end of delivering stable business growth and returns to shareholders in the long run.