For Cafˆm de Coral, the year was one of changes and challenges.
We faced trials on many fronts, primarily from short-term
challenges on rising material, labour and rental costs,
but in the same year, we also engaged in long-term investments
towards our future. As we set our sights on expansion
into the Mainland China market, we were also challenged
to remain competitive in Hong Kong. Our central strategy
was not a quick fix, but to provide a solid foundation
for sustainable growth down the road. We formulated
strategies to address these issues, to improve on employee
morale in the short term, to stabilise our raw material
supply chain in the intermediate term, and to enhance
our productivity and operational efficiencies over the
To that end, I am pleased to announce the development
of the two new central food processing plants in Guangzhou
Development District, China, and Tai Po Industrial Estate,
Hong Kong. These plants will hone our competitive edge
by improving the logistics of our food processing system,
saving time and freeing up valuable retail space on
the front end.
Also high among our priorities has been ensuring a steady
stream of capable and talented individuals to meet tomorrow's
complex corporate needs. Our internal human resources
program, via a vigorous recruitment and screening process,
identifies high potential employees for the greater
corporate good and sees to it that we have a sustainable
pool of management talent to take us into the future
in Hong Kong and in China.
After more than 40 years in business, we have found
that the challenge lies not in the obstacles put before
us, but to rise to the occasion to take on each and
every one of these challenges. This year we built a
solid foundation for the next phase of growth, which
focuses on expansion and diversification.
In order to achieve a much more balanced revenue stream
and to improve on the competitive position of the Group
as a whole, we continued with our multi-brand strategy.
We also further explored new opportunities for mergers
and acquisitions as they arise in order to augment this
strategy and build on our Group's strengths. At the
same time, we continued to focus our attention on Mainland
China, with plans to scale up our development pace in
the South China market and proactively explore ways
to fine-tune our Eastern China business model.
The future is rapidly changing before our eyes. Given
the current challenging employment dynamics, the unceasing
cost inflation, and the competitive leasing landscape,
the rules of the game for business operation will never
be the same. The challenges we faced this year alerted
management to re-examine the way we run our business
here in Hong Kong. It strengthened our resolve to further
improve on our central production and operational efficiency
in order to become more cost effective and price competitive.
In the process, we recognise that our profit margin
will inevitably be impacted in the short term.
However, in the longer view, we remain optimistic and
confident about our future. I believe that the breadth
of our management calibre and the depth of our operational
experience will give us the edge to rise above any adversity
and come out stronger and more resilient than ever.
Under this charted course, the Group has now reached
a size and scale that require a new organisational structure
in order to sustain organic growth and territorial expansion.
I have managed Cafˆm de Coral Group from a homegrown
enterprise to a multinational corporation with a market
capitalisation increased well over 20 times since its
public listing some 25 years ago. It is time, in my
view, to hand over my role as Chief Executive Officer.
It goes without saying that I will sadly miss the comradeship
of the colleagues and partners who have joined me in
this exciting journey in building the Group to what
it is today. While counting the blessings of past years,
I also look forward to my ongoing role as Chairman of
the Company, to lead an effective Board on strategic
direction and to ensure that the Group operates to a
desired standard of corporate governance.
As a seasoned veteran of the Company for the last 29
years, Mr. Sunny Lo assumed the role of Chief Executive
Officer of the Company. He has been my life-long partner
in overseeing the great growth and expansion of the
Group in the past and has accumulated a tremendous wealth
of experience over the years. I strongly believe that
these well-planned succession arrangements will allow
for a more effective management of our diverse and fast-growing
business, and pave the way for a more promising future
for the Group in the years to come.
Chan Yue Kwong, Michael
Hong Kong, 26th June, 2012