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Chairman's Message
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As the lines of a traditional Chinese poem go, “people replace the spring couplets for their homes when they celebrate a new year. (千門萬戶曈曈日,總把新桃換舊符)” During the year under review, the Group faced fierce competition on the broadcast advertising front and yielded lacklustre return from the television screen broadcast business. The Group formally ended the television screen broadcast contracts with MTR Corporation in relation to the Hung Hom Station and KTT Through Train. The Group is of the opinion that the advertising and broadcast business may be vitalized by expanding the currently limited scope of the television screen broadcast business through profound and comprehensive advertising development. Its broadcasting region shall also be broadened from Hong Kong to Mainland China and countries involved in the “Belt and Road” initiative.

The Group begins with a plan to pursue practical cooperation with various advertising businesses in different industries in Mainland China. It intends to set up an operation and production centre in the Greater Bay Area or Hengqin New Area. Much effort will be devoted to the exploration of businesses derived from the television screen advertisement, such as many kinds of advertisement, strategic planning, consultancy, agency and promotion from each and every industry, in order to develop a one-stop service covering the whole industry chain of advertisement. Talent nurturing, sales enhancement, close market monitoring and maintenance of low-cost operation will boost profitability. The Group does not rule out the possibility of acquiring or leasing broadcasting platforms and its relevant properties in the PRC when appropriate.

After studying the market analysis of the PRC’s real estate industry, the Group is of the opinion that despite the current declining trend in property prices in tier 1 cities, the property prices in tier 2 and tier 3 cities remained stable and positive due to the rigid demand. The real estate industry has been one of the key economic drivers. Therefore, the Group planned to explore the viability of property investment and agency as rental income and asset appreciation will benefit the Group. Going forward, “opportunity” and “prudence” will be of priority for the Group’s investments.

The wave of innovation and technology is sweeping through the entire world. President XI Jinping attached great importance to Hong Kong’s scientific development, focusing on facilitating the technological cooperation between Hong Kong and the Mainland China and supporting Hong Kong to become an international innovation and technology centre. The HKSAR government has proposed in its latest budget to invest into the development of the “Hong Kong – Shenzhen Innovation and Technology Park” in the Lok Ma Chau Loop, including capital injection to the Innovation and Technology Fund and support for the construction of technology and innovation platforms to attract top-quality scientific research institutions and technology companies in the world to establish a presence in Hong Kong.

As a listed company in Hong Kong, the Group shall proactively explore and expand its business to the field of technology and innovation. We will seriously consider making selective investments in artificial intelligence, telecommunication and 5G related industries. The Group will pave a way to explore brand-new technology to foster its future development.

A bright future comes with hard work. I would like to express heartfelt gratitude to all Directors and the employees of the Group for their loyalty, commitment and professionalism.

Chan Chun Wo
Co-chairman
Hong Kong, 28 June 2018

In the past year, Economy of Hong Kong rose by 3.8% year-on-year in 2017 amidst rising exports, strong domestic demand and rebounding tourism. On the other hand, esidential property prices surged to an all-time high which are obviously beyond the affordability of the general public, notwithstanding the anticipated interest rate hikes as a result of the dollar peg, the imposition of new restrictions on bank mortgage lendings and the raising of stamp duties on transactions etc. Increasing supply seems to be the fundamental remedy to ease the problem.

The escalation in trade tensions between the United States and China could trigger a trade war between these two biggest economies and bring uncertainties to the global markets. If tariffs or barriers are enacted at the end of the day, it would not only cause damages to these two economies themselves, other countries and regions could too be the losers. Both governments are still unmoved by the challenges put to them and it appears more and more likely that an unwanted trade war will eventually begin.

Hong Kong has been confronted by labour shortage for more than a decade. The unemployment rate during the year under review dropped to 2.9% reflecting a tighter labour market in Hong Kong and hindering our competiveness. Effective measures to address the issue should be afforded priority.

The controversial abolition of offsetting severance payments (SP) and long service payments (LSP) against the Mandatory Provident Fund (MPF) as put forth by the Government has given rise to fierce debate in the community. The proposal, according to the Government, aims to improve the retirement protection for the employees but will without doubt create pressure for the employers if they are not allowed to use the employers’ contributions to offset those payments. Whether cancelling the “offsetting mechanism” in one go or on a progressive basis requires holistic and careful consideration as it will inevitably bring impact on the business environment and the stakeholders as a whole and in the long run, though the Government has agreed a funding injection to alleviate the employers’ burden during the transitional period.

Occupational health and safety have been our adopted policy superior to all. With our continued effort to instill safety concepts to our employees and inculcating a safety culture within the Group, our work injury rate during the year under review was again above the norm of the sector. We will remain steadfast in upholding the record.

The Group is actively seeking to expand in the cleaning and related business, including, but not limited to, building management, through mergers and acquisitions. A horizontal growth strategy is able to bring synergy and benefits to the Group and our shareholders.

I would like to take this opportunity to thank our shareholders and my fellow directors for your unfailing support and to our staff for your devoted efforts over the past year. With your continued contributions, I am confident that the Group will be able to further grow and develop in the years ahead.

Lo Kou Hong
Co-chairman
Hong Kong, 28 June 2018