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Hi-tech Manufacturing
The global impact of the
financial tsunami will inevitably affect our export-oriented hi-tech
manufacturing business.Economic downturn has caused customers’ requests for
price cut or even cancellation of orders, which has in turn generated
tremendous pressure to the hi-tech manufacturing business. It is anticipated
that deeper impact may be encountered in 2009, changing the growth momentum
of the hi-tech manufacturing business.
To cope with the global
economic downturn and the shrinkage of the market, specific contingent
measures have been implemented for the hi-tech manufacturing business. Those
include stepping up our marketing efforts in Mainland China, Europe, Japan
etc. with a view to maintaining the turnover of the business at a stable
level. Meanwhile, internal control and management capabilities will be
enhanced for the business, especially in terms of quality control and cost
control, in order to maintain our competitiveness and profit margin. In the
aspect of financial monitoring, appropriate measures will be taken for the
hi-tech manufacturing business to adjust the scale of operations, cut down
inventory and stringently follow up the receivables from customers, with a
view to maintaining normal inflow of cash to the greatest possible extent.
Building upon the solid
foundation established for our hi-tech manufacturing business over the years
and supported by a sound management system plus an excellent management
team, we believe that the hi-tech manufacturing business will be in a
position to prudently cope with the change and, by launching effective
strategies, it will be able to counteract the difficulties, and continue to
provide stable cash flow and revenue in supporting the overall business
development of the Company.
Science and Technology Park
Complex Development
The establishment of the
business of science and technology park complex development is one of the
important development strategies of the Company. To cope with the entering
into the stages of planning and implementation of the projects of Aerospace
International Centre and the land development for the Complex Zone of the
Launching Site in Hainan Province, the Company will further improve its
management systems, facilitate the allocation of internal resources and
devote additional efforts in implementing and supervising the projects.
Being encountered by the global financial crisis, the Company will conduct
thorough analysis of the market positioning, development plan, financing
plan and implementation plan for each of the projects under this segment,
taking into account the changes of the external economic environment and the
policies in various regions, so as to plan meticulously and to implement in
full force, and adjust and refine the development plans for individual
projects in a timely manner.
Following the completion of
business promotions in respect of the one square kilometre project in
Shanghai Aerospace Technology Industrial Park, Shanghai Aerospace Technology
Investment Management Company Limited (“Shanghai Aerospace”) will expedite
the construction of ancillary facilities and landscape planning at the Park.
The preliminary research and analysis in respect of the future development
direction of part of the owner occupied land in the Park will also be
conducted. In addition, Shanghai Aerospace will discuss with the local
government concerning the subsequent development plans of the Park, taking
into account the latest development of the economy and relevant policies.
Upon finalization of the design
plan of the Aerospace International Centre, Shenzhen Aerospace will speed up
the process to seek proper approvals, engage in the expansion and
commencement plan design, and formulate the overall construction plans and
plans for different stages and for specific items. It is expected that site
levelling of the project, pre-commencement preparation and tendering
processes will commence in mid-2009.
The pre-commencement work in respect of land development for the Complex
Zone of the Launching Site is planned to commence within the year. The
Company will invite internationally renowned architects, theme park
designers, and real estate consultants to form consultant teams, who will
conduct further research and analysis in determining the feasibility of
various development plans, and formulate long-term development planning and
business models for the project.
Though encountered with the
downturn in global economy, the Company is cautiously optimistic about its
future development prospects. The Chinese Government, in order to achieve
its target to maintain economic growth with full effort, has put forward a
series of measures in stimulating the economy. These include the proposal of
huge investments in stimulating the economy, the implementation of
enterprising fiscal policy and appropriate loosened monetary policy etc.,
with an aim of increasing domestic demands and booming the economy. The
Company believes that these new policies will help to create an advantageous
investment environment. Besides, the fall in market value of quality assets
caused by the global economic downturn and credit tightening will bring
along investment opportunities to those strong enterprises. The Company
possesses a healthy and stable cash flow with relatively low gearing.
Through the utilization of loosened monetary policy in China while
maintaining stable operation and strict risk control policy, the Company
will take the opportunity to adopt appropriate financial leverage and seek
investment opportunities of acquiring quality assets so as to push forward a
new breakthrough in the business of science and technology park complex
development.
The Board believes that while
major effort has been spent to ensure steady growth in the business of
hi-tech manufacturing, the business of science and technology park complex
development will create momentum for the Company’s new development and will
become a mainstream of economic growth in future. |