Author: Mei Ling Tan

  • Rare reef fish brought in illegally

    Rare reef fish brought in illegally

    More than 1,000 endangered but highly valued reef fish sold in Hong Kong last year were imported illegally, a university study shows.

    It was released yesterday and funded by the University of Hong Kong and the Convention on International Trade in Endangered Species.

    More than 1,000 humphead wrasse, also known as Napoleon fish, were on sale in Hong Kong live fish shops from January to December 2015, said the study.

    Since no official imports occurred in 2015 and the species is typically sold within a few weeks of import, the survey suggests that many of these fish illegally entered the SAR, said professor Yvonne Sadovy of HKU’s School of Biological Sciences.

    Humphead wrasse is one of the biggest reef fish in the world. It is reported to grow as long as two meters and can live longer than 30 years.

    The retail price of live humphead wrasse in the local seafood markets was HK$1,550 to HK$1,600 per kilogram.

    “Failure to act to ensure legal and sustainable trade in this globally threatened species will ultimately result in higher prices for humpheads and fewer fish available to consumers and to the poor fishermen. Nobody wins,” Sadovy said.

    She called for urgent action by the government to ensure that imports and sales of humpheads are legal.

    FLORA CHUNG

  • Here is What Institutional Investors Think About China Jo-jo Drugstores Inc

    Here is What Institutional Investors Think About China Jo-jo Drugstores Inc

    China Jo-jo Drugstores Inc institutional sentiment decreased to 1 in 2015 Q3. Its down -1.50, from 2.5 in 2015Q2. The ratio is negative, as 5 investment professionals opened new or increased holdings, while 2 trimmed and sold equity positions in China Jo-jo Drugstores Inc. The investment professionals in our partner’s database now have: 783,924 shares, up from 321,572 shares in 2015Q2. Also, the number of investment professionals holding China Jo-jo Drugstores Inc in their top 10 holdings was flat from 0 to 0 for the same number.

    China Jo-Jo Drugstores, Inc. is a retailer and distributor of pharmaceutical and other healthcare products found in a retail pharmacy in the People’s Republic of China. The company has a market cap of $29.26 million. The Company’s operating divisions include retail drugstores, online pharmacy, wholesale business selling products similar to those the Company carries in its pharmacies, and farming and selling herbs used for traditional Chinese medicine . It has 33.31 P/E ratio. The Firm has 59 store locations under the store brand Jiuzhou Grand Pharmacy in Hangzhou.

    It is up 28.82% since August 11, 2015 and is downtrending. It has underperformed by 26.09% the S&P500.

    Analysts await China Jo-Jo Drugstores Inc to reports earnings on July, 4.

    According to Zacks Investment Research, “China Jo-Jo Drugstores, Inc., through its contractually controlled affiliates, operates a retail pharmacy chain in China offering both western and traditional Chinese medicine. Its contractually controlled affiliates include Hangzhou Jiuzhou Grand Pharmacy Chain Co., Ltd., Hangzhou Jiuzhou Clinic of Integrated Traditional and Western Medicine General Partnership, and Hangzhou Jiuzhou Medical & Public Health Service Co., Ltd. The chain has stores throughout Hangzhou, the provincial capital of Zhejiang Province.”

    Sabby Management Llc holds 0.05% of its portfolio in China Jo-Jo Drugstores Inc for 614,149 shares. California Public Employees Retirement System owns 29,300 shares or 0% of their US portfolio. Moreover, Morgan Stanley has 0% invested in the company for 34,787 shares. The New York-based Renaissance Technologies Llc has invested 0% in the stock. Sabal Trust Co, a Florida-based fund reported 12,400 shares.

  • HK’s Li & Fung 2015 profit down, but beats forecast

    HK’s Li & Fung 2015 profit down, but beats forecast

    Global exporter Li & Fung Ltd’s full-year profit fell 4.6 percent but beat analysts’ estimates, as growth in its logistics and vendor support services business helped overcome headwinds from global retail disruption and macro environment.

    The Hong Kong-based company, which grew to prominence by making clothing and toys in Asia for Western retailers, said on Thursday its net profit for the year ended Dec. 31 fell to $421 million from $441 million a year earlier.

    That compared with an average forecast of $413.2 million by 10 analysts polled by Reuters. Li & Fung, which supplies to companies like Kohl’s Corp and Wal-Mart Stores Inc, said core operating
    profit fell 15.2 percent to $512 million.

    Revenue fell to $18.8 billion from $19.3 billion a year ago, which was the biggest company by revenue for 2014 in Asia pacific in “Textiles & Apparel” industry.

    Textile companies in China are expected to post a 12-month forward revenue growth of 23 percent, the highest expected increase in the Asia-Pacific region in the “Textile & Apparel”
    sector, according to Thomson Reuters StarMine SmartEstimates, which emphasizes on recent forecasts by top-rated analysts.

    Li & Fung has refocused on its core asset-light supply-chain business following the sale of its loss-making brand-licensing and distribution business in 2014, helping it boost free cash flow and better control operating costs.

    The company, with a market value of about $5.3 billion, posted a 34 percent rise in January-June profit last year at $149 million.

    Analysts were concerned about inventory build-up at retailer level as inventories grew faster than sales growth in recent quarters. They worried that Li & Fung’s turnover would be affected as U.S. retailers focus on resolving high inventory levels.

  • Hengdeli Achieves Sustainable Growth for 2015

    Hengdeli Achieves Sustainable Growth for 2015

    Hengdeli Holdings Limited, a world-leading retailer of internationally renowned brand watches, announced its annual results for the year ended 31 December 2015 (the “year under review”).

    In 2015, the overall operating environment was very challenging and negatively impacted on the business development of the Group, resulting in weak sales of internationally renowned brand watches. Despite this, the Group’s industrial sector achieved relatively good results due to a series of reforms and innovations. During the year under review, the Group recorded revenues of RMB13,302,724,000, representing a year-on-year decrease of 9.9%. Retail sales amounted to RMB9,373,354,000, a year-on-year decrease of 11.6%. Revenue from industrial sector and others amounted to RMB539,991,000, a year-on-year increase of 25.9%. The Group recorded net profit of RMB190,164,000, a year-on-year decrease of 67.4%. Profit attributable to equity shareholders amounted to RMB144,868,000, a year-on-year decrease of 71.3%. This decrease in profits was mainly due to one-off revenue from the disposal of properties, which was included in the profit for the year of 2014, as well as a drop in sales and gross profit and impairment of goodwill and available-for-sale securities.

    Mr. Zhang Yuping, Chairman and the Executive Director of Hengdeli, said, “In 2015, the overall business environment remained unstable. The increasingly diversified shopping locations and consumption patterns of Mainland Chinese consumers aggravated the harsh environment for product sales as a whole in the Greater China region, especially in Hong Kong. Businesses are faced with a loss of customers and a rise in labor costs. Despite these highly challenging business circumstances, the Group held fast to its operating principle of “healthy and sustainability” to ensure business stability and to better safeguard the interest of shareholders.”

    During the year under review, the Group continued to be guided by the principle of “healthy and sustainability” along with “aiming for optimizing inventory and guaranteeing profits.” The Group also insisted on keeping in place a policy of mutual complementary and interactive operations across the Greater China region, including Mainland and Hong Kong, with mid-end brands serving as the mainstay in its brand mix in order to meet the affordability demands of the general public, and second, third and fourth tier cities as the main sales regions. The Group also continued to adjust the layout of retail network, constantly improving store quality and optimizing the inventory mix. The Group carefully steered business forward through strengthened scientific management and prudent operations. Despite the Group’s various efforts, it was unable to stem the decline in sales as affected by adverse macro condition and subdued consumer demand. Retail sales from Mainland China decreased 7.4% as compared with that of the previous year. Under dismal overall conditions, sales of Elegant Hong Kong decreased 26.8% year-on-year along in line with the overall market trends. As at 31st December 2015, after adjustments and optimization, the Group operated a total of 482 retail outlets across Mainland China, Hong Kong, Macau and Taiwan.

    The industrial sector which is engaged in the manufacture of watch accessories made substantial progress during the year under review. Based on a previously launched marketing strategy and after more than one year of re-alignment and integration, the industrial sector has established a new business model comprising upstream and downstream operations of the watch industrial chain, spanning watchcase manufacturing, packaging products and commercial space design, to production and decoration as well as self-development of brands. A number of companies in the sector have earned goodwill in their respective markets, while a wide customer base covering China, Switzerland, the U.S. and other nations in the Asia-Pacific region was established. Co-operation with brand suppliers has been increasing and a close collaborative relationship with mutual trust and interest sharing was formed. Benefiting from quality management and bold innovations, overall performance of the industrial sector improved remarkably with sales increasing by approximately 35% year-on-year, reflecting a healthy uptrend and promising growth potential. The industrial sector is seen as becoming a strong driving force for the Group’s overall development and turning into an important business arm of the Group in the foreseeable future.

    Following highly focused preparations and various enhancements , “censh.com” (www.censh.com), a new consumption model that merges the “Internet + Hengdeli”, was officially launched online during the year under review. “censh.com” is a media-based e-commerce cross-platform within the Group that operates its major flagship – “censh.com” (www.censh.com), drawing together a number of popular mobile internet software platforms, including WeChat, Weibo and other mobile communication applications. It provides a one-stop solution for six major functions, namely: e-commerce, ERP, product data management, customer resources management, call center and messaging. It offers a comprehensive online to offline service experience to watch lovers. The Group believes that with the successful online operation of “censh.com”, the online and offline resources will become highly synergistic, and will contribute significantly to the overall development of the Group.

    The Group’s customer service network and maintenance business, renowned as a top-notch, retail group leader for internationally renowned watch brands, has been fully integrated and comprehensively covers the Greater China region. During the year under review, the Group added the CK brand into its comprehensive customer services arrangements with brand suppliers, including: Tissot, Mido, and Certina from the SWATCH Group, as well as others. The Group also entered into exclusive watch maintenance agent agreements with: Movado, Milus, Blita, LOCMAN, Million Horn and others. To date, the Group has become the maintenance agent for 74 international brands such as those from the SWATCH Group and LVMH Group and also serves as the exclusive maintenance agent for 45 of those brands.

    In the brand distribution business, the Group has always maintained a sound co-operative relationship with numerous brand suppliers and brand retailers, and has received active general support from them. The Group has about 400 wholesale customers in over one hundred cities across China, distributing and exclusively distributing world-famous watch brands. For the coming year, the Group will continue to maintain and deepen its relationships with suppliers and retailers, while exploring new measures under the “new normal” economic climate to achieve harmonious growth and win-win situation.

    In the coming year, the Group will hold on to a stable and healthy growth policy, while at the same time harboring a pragmatic view and fostering an innovative spirit in the search for a new development model to benefit the Group. We will also continue to make structural adjustments while ensuring healthy growth and seeking business sustainability. The Group will maintain a healthy and stable level of sale and inventory on the one hand while investing more resources in our industrial sector to help bolster faster development. The overall aim is to open up a road of continuous development for the Group amid today’s “new normal” economic climate and generate higher value for shareholders and the community at large.

    Mr. Zhang concluded, “In 2016, as the road to full global economic recovery is still long and winding, China’s economy will also be faced with significant downward pressures. For this reason, the Group believes that under the new normal economic climate, the growth in sales for watches in the Greater China region will continue to lose steam. However, the long-term economic trend in China remains fundamentally favorable, which will offer unprecedented opportunities and challenges. By leveraging our core competitiveness, the Group will identify and take advantage of any and all new opportunities to achieve business breakthroughs and expand business despite the current headwinds and challenges. Ultimately we remain cautiously optimistic about the future prospects of the Group.”

     

  • China Takes Over Australia’s Domination of Bali’s Tourist Arrivals

    China Takes Over Australia’s Domination of Bali’s Tourist Arrivals

    Chinas tourists have taken over the domination of Australian tourists who so far top the list of foreign tourist arrivals in the Indonesian tourist resort Island of Bali.

    “I have predicted that the number of Chinese tourists visiting Bali will increase after the government provides them with a visa-free facility and the opening of smooth direct flights to China,” Tourism observer Dewa Nyoman said here on Sunday.

    This condition has been observed since in the past several months. Moreover, the economic conditions in Australia are not conducive of late, he said.

    In the meantime, he said, the Chinese economy is relatively encouraging now.

    Indonesian flag carrier Garuda has also expended its flight routes linking Denpasar with Shanghai after it has previously opened a flight route that connected Denpasar with Beijing and Guangzhu in 2015.

    It seems that Garuda Indonesia is focusing on its flight expansion in China as the countrys foreign tourists which conduct overseas trips are large reaching some 100 million.

    He said that based on the records of Balis Tourism Service, the number of Chinese tourists arriving in Bali increased by 30 percent in the first months of 2016, topping the foreign tourist arrivals list.

    In the January-February period, a total of 189,594 Chinese tourists arrived in Bali, up from 145,747 in the same period in 2015.

    In January – February 2015, the number of Chinese visitors in Indonesia was still recorded in the second position.

    The Australian tourists holidaying on the island of Bali in the January – February period this year declined by 0.96 percent to 154,892 people. In the same period in 2015, the number of Australian visitors were recorded at 156,395.

    Japanese tourists occupied the third place with 39,371 visitors recorded last January and February, down 2.89 percent from 40,544 in the same period last year.

    Duwa Putra expressed convince that this year the number of Chinese tourists will continue to increase, replacing the domination the Australian tourists. After all, the volume of flights from Australia is increasingly limited.

    Besides, Garuda also services passengers with its routes covering Beijing, Guangzhou and Shanghai via Denpasar and Jakarta.

    The numerous flights facilitate the desires of young Chinese who want to spend their honeymoon in Bali, he said.

  • Tourism ministry promotes Wonderful Indonesia in Auckland Festival

    Tourism ministry promotes Wonderful Indonesia in Auckland Festival

    The Indonesian tourism ministry joined the Auckland International Cultural Festival to promote Wonderful Indonesia on March 20, I Gde Pitana, deputy tourism minister in charge of the international tourism market development, said here, Sunday.

    New Zealand is a potential tourism market that needs to be exploited optimally, according to him.

    The ministry will be more serious in exploiting market in New Zealand whose people have a high prosperity level, he stated.

    In the international festival, Indonesia would present cultural and art performances, he said.

    The Indonesian delegation to the festival is headed by Titik Lestari, head of a sub-department in charge of culinary and music, of the tourism ministry.

    The delegation includes members of the Sanggar Gea Asmara art group.

    “They will present traditional dances during the Auckland International Cultural Festival, such as Bajidor Kahot dance, Cendrawasih dance, Alusia dance, and Piring dance,” he said.
    (T.H016/Uu.F001)

  • Billionaire Li Ka-shing sounds alarm over Hong Kong’s economy

    Billionaire Li Ka-shing sounds alarm over Hong Kong’s economy

    Hong Kong’s economy is at its worst in 20 years, billionaire Li Ka-shing said on Thursday, warning that the city’s stock market could fall by more than half if the financial hub does not get backing from mainland China.

    Li, who held court and joked with reporters for more than an hour during an earnings news conference, is the latest person to sound the alarm after Moody’s downgraded Hong Kong’s sovereign credit rating at the weekend, citing its links to China’s economic slowdown.

    “Today’s Hong Kong is getting worse, the worst I’ve seen in 20 years,” said Li, 88, referring to the Asia financial crisis in the late 1990s. Our home sales and retail now is worse than the SARS period. During SARS (the effect) was short-lived but now it is long,” he said, in a reference to the Severe Acute Respiratory Syndrome that crippled the city in 2003.

    Hong Kong retail sales, which suffered their worst decline in 13 years in 2015, have been hit by a slump in tourist from the mainland which has been blamed in part on increasing cross-border tensions and political unease on both sides.

    “If we respect tourists, no matter where they’re from, today our retail, hotels would not be this bad. So everyone has to reflect on themselves, there are a lot of issues the politicians need to reflect on how they can do better,” Li said.

    In February, Hong Kong’s Financial Secretary John Tsang said “political volatility” was threatening to undermine the economy and warned disputes would intensify ahead of this year’s elections which pit the city’s democratic opposition against pro-Beijing parties.

    A former British territory, Hong Kong is ruled under a “one country, two systems” formula that allows wide-ranging autonomy and freedoms not enjoyed in mainland China, but many in the city have voiced concern over what they see as increasing interference by Beijing in its affairs.

    Li, known as Superman for his deal-making savvy, said he does not think Hong Kong people want independence and urged residents to allow the city to be stable and prosperous.

    Earlier on Thursday, Li’s ports-to-telecoms conglomerate CK Hutchison reported a net profit of HK$31.17 billion ($4 billion) for 2015, in its first full-year earnings report after a reorganisation last year.

    Li continued to take questions from the packed conference even as company officials tried to usher him out, saying finally with a smile: “You guys are just expecting me to slip out something wrong.”

     

  • ASEAN tourism to launch Visit ASEAN@50 Golden Celebration in 2017

    ASEAN tourism to launch Visit ASEAN@50 Golden Celebration in 2017

    Member countries of ASEAN will celebrate the groupings 50th Anniversary in 2017 by holding a joint tourism programme under the theme “Visit ASEAN@50: Golden Celebration” with the objective of embracing ASEAN as a single and united tourism destination.

    “Visit ASEAN@50: Golden Celebration will highlight ASEANs best 50 festivals and 50 most unforgettable travel experiences, whereby visitors will enjoy a wide range of ASEAN tourism products through diverse destinations, culinary, events, and engagements with local communities,” the ASEAN Secretariat said in a statement.

    Special offers and travel promotions with affiliated partners will be rolled out for travellers to enjoy the richness of cultural, heritage, nature, and to feel the warmth of ASEAN hospitality.

    Targeting major regional and long-haul source markets, such as: China, Japan, Korea, India, Australia, UK, Germany, Russia, the UAE, USA and Canada, Visit ASEAN@50: Golden Celebration is expected to achieve 121 million international visitor arrivals to the region by the end of 2017.

    Also increase tourism receipts to USD 83 billion; and extend tourist visitations average length of stay to 6-7 days, and to more than 2 ASEAN countries.

    The official pre-launch of the Visit ASEAN@50: Golden Celebration campaign was spearheaded by ASEAN Tourism Ministers and Leaders at the ITB Berlin on 10 March 2016.

    The pre-launch was followed by two days of ASEAN cultural performances for ITB Berlin’s public audiences on 12 and 13 March at Thailand pavilion.

  • Singapore customers left hanging when Asos orders fail to arrive

    Singapore customers left hanging when Asos orders fail to arrive

    She is a loyal Asos customer who has ordered from the UK website not once, not twice, but a total of 19 times so far. But the latest experience for Ms Bernie Low, a local blogger, has been nothing short of frustrating.

    Ms Low, 22, is just one of many customers who have taken to Facebook to voice their unhappiness over missing goods ordered from the retail giant in January.

    Many of these customers had placed their orders as early as the beginning of January as they were hoping to wear their new clothes for Chinese New Year. However, Chinese New Year has come and gone but there was still no sign of their clothes.

    What has been more agonising for these customers is that they have been told time and again to wait for their deliveries by different members of the Asos social media team.

    Ms Low, who likes Asos for its free worldwide shipping, affordable prices and plus-sized offerings, had ordered five items from the store on Jan 10 this year. However, her items did not arrive on the Jan 28 delivery date that is usually stated on the email tax invoice.

    Instead, she was told that delivery would be pushed back by almost one month to Feb 24. Despite this, she told AsiaOne that she had not received any of the five items on Feb 24.

    In a blog post on Feb 18, Ms Low expressed frustration at the way the Asos team was handling its customer queries.

    “Look, there has to be something that is wrong since so many orders to Singapore have all gone missing, most likely all from the same batch and shipped together. They keep asking us to send in more details to verify the order and everyone gets told to wait even longer,” she wrote.

    “Plus many, many, many other Singaporeans have faced this problem yet no one is getting a proper response. We see the exact same responses copy pasted for every single dispute. It is very frustrating.”

    Another Asos customer, Laysie Lim, 35, told AsiaOne that she had also raised her concerns with the company after her Jan 14 order failed to arrive on Feb 3. According to Ms Lim, the retailer was holding a Chinese New Year promotion at the time and offered an 18 per cent discount on purchases.

    When she contacted Asos, the designer was told that her shipment would arrive on Feb 21 instead.

    Later, she heard from two of her colleagues that they too had not received orders made on Asos. That was when she realised that many other Singaporeans had been complaining of missing parcels on the Asos Facebook page.

    Ms Lim was then told to give her order details to Asos again, but the representative who replied told her that delivery would be further delayed till Feb 26.

    “Real sorry for this delay, I hope it doesn’t cause you too much troubles – keep an eye out for the postman Laysie,” the message from a representative identified as Danielle read.

    When asked about the cause of the delay, another representative named Holly said: “We need to allow some extra time due to postal delays in your area. We’re really sorry about this Laysie”.

    In an email response to AsiaOne, the London-based e-commerce retailer did not mention that there were any obstacles for delivery to Singapore.

    Instead, a spokesperson from Asos said that the delay was caused by incorrect address labels printed by its delivery partner.

    “One of our delivery partners recently made a change to their technology that updated the way address labels were printed. As a result many of our customers’ addresses were not printed correctly and packages were unable to be delivered,” the spokesperson said.

    According to Asos, the problem was identified and fixed on the same day.

    When asked about the feedback received so far, Asos said in an email: “We apologise to any customers who are impacted”.

    For many customers, however, an answer – not an apology – is what they are looking for.

    Both Ms Lim and Ms Low said that they would continue to order from Asos despite the disappointing experience – but only if their purchases are accounted for.

    “I’m very disappointed because I really like Asos,” Ms Low said in a phone interview with AsiaOne in February, adding that she could still forgive the store if her purchases arrive by March, or if she is given a refund. In a second interview, Ms Low said that Asos had offered to give her a refund after the clothes she ordered did not arrive on Feb 24 as promised.

    But even getting a refund might not prove to be any easier.

    Although Ms Lim told AsiaOne that she had received her refund, not all Asos customers were given a satisfactory reply to their requests.

    Facebook user Jo Koh was one of many customers who left a frustrated message on the Asos page asking for a proper response. “I have been in contact with Asos since Feb 16 for an order which (was) due to arrive on Feb 4 but never arrived,” the user wrote on Feb 24.

    As her order had not arrived by Feb 23, she decided to request for a refund instead. To her disappointment, she did not receive a reply from Asos. “I am completely disappointed! Can someone please get back to me!” she wrote.

    Another Facebook user, Daryl Aw Yeong, wrote on Feb 23 that he had gotten a refund from Asos, but not without “a heck load of trouble and it wasn’t a good experience”.

    His tactic for finally getting a response? “Spamming” the Asos Facebook page, he said.

    Going by the number of complaints posted on the Asos Facebook page thus far, it seems that “spamming” is what many of its customers have resorted to doing in the hopes of getting a response from the e-retailer on their delayed parcels.

    In response to AsiaOne’s queries on Asos’ refund process, a spokesperson said:”‘Our customer care team has a full list of all those affected by this issue. Should any customer on this list advise our team that their delivery has not yet arrived, they will be entitled to a full refund.”

  • Apple eyes Vietnam R&D centre

    Apple eyes Vietnam R&D centre

    US tech giant Apple is mulling a $1-billion regional data hub in Hanoi, according to the Dien dan doanh nghiep, the official publication of the Vietnam Chamber of Commerce and Industry.

    “Apple is studying the sites for the construction and completing the investment procedures,” the publication said, cited its source.

    This will be Apple’s first investment in Vietnam and it will be following in the footsteps of South Korean conglomerates Samsung and LG, and US-headquartered Microsoft, which have been present in the country for years.

    However, while the others have invested in manufacturing facilities in Vietnam, Apple will reportedly build a data centre meant for its entire Asian operations.

    Reuters reported in November last year that Apple had set up a subsidiary in the Southeast Asian country to import and sell its mobile phones directly in this market.

    Samsung is one of the biggest investors in Vietnam with $13 billion direct investment in factories and a research hub in Bac Ninh, Thai Nguyen and Ho Chi Minh City. LG Electronics is also building a $1.5-billion producing complex in northern Vietnam. Microsoft has shifted its smartphone production from China, Hungary and Mexico to Vietnam in 2014.

    Meanwhile, the iPhone maker has been aggressively investing in R&D with a spend of $8 billion last year. Apple already has R&D facilities in the UK, China, Taiwan, US, Israel and Japan.

    “It is unclear when Apple will deploy the Hanoi-based centre, but the size of the project has shown the high potential of the Vietnam market to the US tech major,” the Dien dan doanh nghiep commented.

    Samsung, as Apple’s biggest competitor in the Vietnam’s mobile phone market, is also investing in two R&D centres, a $300-million new one in Hanoi and a facility within the $1.4-billion complex in Ho Chi Minh City.

    Several other global tech and electronics firms have chosen Vietnam as base for their global back-end and manufacturing activities, including Hewlett-Packard, Panasonic and Nissan Techno.

    Vietnam is considered as the next manufacturing powerhouse of Asia, fueled by its growing economy, young and urbanised population and cheap labour cost.

    Also, US has been Vietnam’s biggest export market for the last couple of years, accounting for the largest proportion of 20.7 per cent of the total exports, according to a latest update of Trading Economics.

  • Hong Kong economy in worst shape in 20 years

    Hong Kong economy in worst shape in 20 years

    Billionaire Li Ka Shing said yesterday that Hong Kong’s economy is at its worst in 20 years, and warned that the city’s stock market could fall by more than half if the financial hub does not get backing from mainland China.

    Mr Li, who held court with reporters for over an hour at an earnings news conference, is the latest person to sound the alarm after Moody’s downgraded Hong Kong’s sovereign credit rating at the weekend, citing its links to China’s economic slowdown.

    “Today’s Hong Kong is getting worse… the worst I’ve seen in 20 years,” said Mr Li, 88, referring to the Asian financial crisis in the late 1990s. “Our home sales and retail now is worse than in the Sars period. During Sars, (the effect) was short-lived but now it is long,” he said, in a reference to the severe acute respiratory syndrome that crippled the city in 2003.

    Hong Kong retail sales, which suffered their worst decline in 13 years last year, have been hit by a slump in tourists from the mainland which has been blamed in part on increasing cross-border tensions.

    “If we respect tourists, no matter where they’re from, today our retail, hotels would not be this bad. So everyone has to reflect on themselves, there are a lot of issues the politicians need to reflect on how they can do better,” Mr Li said.

    Last month, Hong Kong’s Financial Secretary John Tsang said”political volatility” was threatening to undermine the economy and warned disputes would intensify ahead of this year’s elections.

    A former British territory, Hong Kong is ruled under a “one country, two systems” formula, but many in the city have voiced concern over what they see as increasing interference by Beijing. Mr Li, known as Superman for his deal-making savvy, said he does not think Hong Kong people want independence and urged residents to allow the city to be stable and prosperous.

    Earlier, Mr Li’s ports-to-telecoms conglomerate CK Hutchison reported a net profit of HK$31.17 billion (S$5.4 billion) for last year, in its first full-year earnings report after a reorganisation last year. The company also announced a full-year dividend of HK$2.55 a share, while analysts estimated HK$2.71.

    CK Hutchison shares dropped 0.3 per cent to close at HK$98.85 before it announced earnings, extending this year’s decline to 5.5 per cent. The benchmark Hang Seng Index fell 6.4 per cent last year.

  • Fairly or unfairly, Asia nerves keep Ted Baker under pressure

    Fairly or unfairly, Asia nerves keep Ted Baker under pressure

    Despite a strong set of annual numbers, shares in fashion retailer Ted Baker didn’t react well to news that softer economic conditions in Asia had hindered the group’s growth there. But Ted’s Asian business is still pretty small – accounting for roughly 3.4 per cent of group sales – and finance director Charles Anderson insists the brand is well received there. The long-term opportunity, he says, remains intact.

    Asia aside, Ted’s retail sales are growing fast across other geographies. These include North America, where sales rose by more than a quarter last year and the UK and Europe, where sales rose 8.9 per cent, or 10.7 per cent at constant currencies. Overall, this made for a solid retail performance, with total sales for the division up 13.5 per cent to £348m based on an average increase in square footage of 7.5 per cent. More retail space is on the way: a new store is slated to open in Paris along with further concessions in Germany and Spain. Shop openings are also scheduled in Asia, with further concessions across mainland China and Japan to follow a new store in Beijing. Meanwhile, good domestic performance pushed wholesale sales up a third to £108m.

    Another area of growth is online. Last year web-based sales grew by a massive 46 per cent to £53.5m and now represent around 15 per cent of total revenue (from 12 per cent in FY2015). Investments in the web platform are set to continue this year.

    But that won’t be the only reasons for higher running costs this year. Ted just entered a new lease agreement for a ‘state-of-the-art’ distribution facility in the UK which will serve as the main European distribution centre for the group’s general retail stock. Therefore, it’s Mr Anderson’s belief that costs will increase marginally this year while the company migrates to the new system. Costs should revert to normal levels thereafter.

    Analysts at Peel Hunt expect pre-tax profit of £68.9m for the year ending January 2017, giving EPS of 117p, compared with £58.7m and 101p in FY2016.

    TED BAKER (TED)
    ORD PRICE: 2,926p MARKET VALUE: £1.29bn
    TOUCH: 2,926-2,930p 12-MONTH HIGH: 3,650p LOW: 2,463p
    DIVIDEND YIELD: 1.6% PE RATIO: 29
    NET ASSET VALUE: 392p NET DEBT: 49%
    Year to 30 Jan Turnover (£m) Pre-tax profit (£m) Earnings per share (p) Dividend per share (p)
    2012 216 24.3 42.2 23.4
    2013 254 28.9 51.5 26.6
    2014 322 38.9 67.2 33.7
    2015 388 48.8 82.0 40.3
    2016 456 58.7 101 47.8
    % change +18 +20 +23 +19
    Ex-div: 19 May

    Payment: 17 Jun

  • Retail regulations failing to make a big impact

    Retail regulations failing to make a big impact

    Since June 6, 2012, a local government regulation has required large discount supermarkets like Lotte Mart and E-Mart to be closed every second and fourth Sunday of the month in a bid to boost merchants at traditional markets who have seen dwindling customers.

    But more than three years since the regulation was put into place, its effects have been tepid. In interviews with merchants at traditional markets, most said they could not sense a big difference after the regulation, but they did not want the regulation to stop, either.

    Many said they hope for more practical measures to stop the decrease in their annual customer numbers. Some complained most traditional markets do not offer parking.

    In fact, parking facilities was one of the biggest reasons why customers said they preferred big supermarkets over traditional markets. Customers also cited the wide variety of items they can buy at a supermarket under one roof as another advantage.

    On top of that, according to market research firm TNS, big supermarkets typically contain 50,000 stock keeping units, while traditional markets only have 2,000, limiting their supply.

    In a TNS survey, when asked what they usually do when big supermarkets are closed, three out of 10 customers said they would postpone shopping until the supermarkets are open again. Seven out of 10 said that they would shop elsewhere, such as at convenience stores or online shopping sites; only 20 percent of those people said they would go to traditional markets instead.

    “The regulation on big supermarkets goes against the retail market’s modernization and hinders its gradual development,” said Ahn Seung-ho, a business professor at Soongsil University, during hearings on the regulation in September 2015.

    “The cause of small retailers going downhill is not the big supermarkets but the competition and competitiveness problems between similar local business conditions. The policy should be written to elevate the competitiveness of local commerce.”

    The regulation has effects not only on big supermarkets but also goods suppliers and supermarket workers. With the stores closed two days a month, goods suppliers suffer a direct economic loss, while supermarket employees, because most of them are non-regular workers, suffer employment instability.

    Supporters of small traditional markets, though, insist the regulation is necessary.

    “From 2013, the monthly business profits of micro-enterprises have decreased 25.5 percent compared to 2010,” said the head of the survey study department at the Nohwabong Micro-enterprise Promotion Foundation. “This is evidence that the regulation was appropriate.”

    Local government and micro-enterprise organizations say the regulation is preventing polarization. They argue that if big market regulations disappear, chances are high that large retailers will monopolize the market, and customers might suffer loss due to price increases.

     

  • Suzuki spreading its wings in Bulacan

    Suzuki spreading its wings in Bulacan

    Suzuki Philippines, the only integrated automobile and motorcycle company in the country, recorded one of the biggest sales growths in the industry last year with its massive 52% year-on-year growth and 10,000 retail sales, and aims to repeat this 2015 performance by carrying out successive dealership openings in 2016.

    Last February 24, the pioneer manufacturer of compact cars and one of the top automotivebrands in the Philippines inaugurated one 3S dealership and two satellite branches—the SuzukiAuto Pulilan, the Suzuki Auto Malolos satellite, and the Suzuki Auto Quezon Avenue.

    This was the second set of auto shop launches in February, and the ribbon cutting ceremonies were ledby Suzuki Philippines Managing Director and Treasurer Mojica, General Manager forAutomobiles Shuzo Hoshikura, Mt. Sinai Motors Corporation, and ETNA Motors Inc.Development in Pulilan and Malolos, BulacanPulilan City currently experiences robust commercialization and industrialization, with a growingnumber of manufacturing companies establishing their presence here. Recognizing itsdevelopment potential, SPH brings a 3S outlet in the area to offer existing and new customersthe same high-quality vehicles, repairs and parts which Suzuki patrons enjoy all over the country. Suzuki Auto Pulilan, owned and managed by Mt. Sinai Motors Corporation, startedsales operations in June 2015.

    It is strategically located along Doña Remedios TrinidadHighway and is the first dealership in Bulacan that offers sales, spare parts and services.Bulaceños can now equally have easy access to Suzuki products via the Malolos branch. Alsooperated by Mt. Sinai Motors, Suzuki Auto Malolos serves as the satellite branch of Suzuki AutoPulilan. It started selling in November 2013 and established its satellite showroom in October2015.

    The satellite branch can be visited at Central Point Plaza, McArthur Highway, Bgy. Dakila,Malolos City, Bulacan.Branching out in Quezon Avenue Serving as the second satellite shop of Suzuki Auto Commonwealth, Suzuki Auto QuezonAvenue likewise held its official launching last February. To increase the market coverage of the brand, SPH and ETNA Motors Inc.–owner and manager of the Commonwealthdealership– again collaborated to cater to the automotive needs of motorists with the easy-to-access location at Quezon Ave. cor. Cordillera St., Sta. Mesa Heights, Quezon City. The back-to-back dealership inaugurations are part of the Japanese car maker’s game plan toonce again achieve high sales volume this year, as well as to expand and increase thecompany’s reach to its clients nationwide. SPH strives to make this a great and historic yearstarting off with the sequent dealership expansions and introduction of its first sedan, the all-newCiaz.SPH General Manager for Automobile, Shuzo Hoshikura remarked, “Our dedication andcommitment to reaching out to a wider Suzuki market is no more evident than with theinauguration of these three new networks.

    I am confident that these three newly-inauguratedoutlets will perform excellently and help us achieve greater sales figures this year.” Hoshikura added, “We at Suzuki Philippines are taking every possible opportunity to sharethe Suzuki Way of Life through the continuous expansion of the Suzuki Automobile DealerNetwork nationwide. We are determined to make more customers experience the difference,and make a positive mark in the industry.”

  • Li & Fung cautions on weak outlook for global retail

    Li & Fung cautions on weak outlook for global retail

    Hong Kong-listed Li & Fung, which supplies products from China for international groups including Walmart, has warned that the global retail market will remain weak this year as deflation continues to weigh on Chinese factories.

    The world’s largest sourcing company by revenue is a barometer for the state of global trade and the Chinese manufacturing industry and has had its profits and turnover squeezed in recent years amid tough market conditions.

    “The global economy looks challenging,” Spencer Fung, chief executive of the family-led company, said on Thursday as the group reported another drop in profits and revenue last year. “For 2016, the consumer sector is likely to remain weak and factory deflation will continue.”

    Revenue fell 2.4 per cent to $18.8bn in the year to December 31, while net profit attributable to shareholders shrank 4.6 per cent to $421m, marginally ahead of analysts’ expectations.

    Mr Fung, who is the great-grandson of the company’s founder, said 2015 had been another difficult year for the business. Li & Fung’s traditional role as a middleman between factories and retailers has been disrupted by the growth of ecommerce and fast-changing consumer tastes.

    “Our major markets in the US, Europe and Asia all experienced strong headwinds,” he said, noting that the price of shipping a container from China had fallen as much as 75 per cent in some cases because of lower demand.

    Shares in Li & Fung have fallen 36 per cent in the past year as investors remain concerned about its ability to overcome the structural changes in the retail and manufacturing industries at a time when the global economy is struggling.

    Mr Fung said the company managed to increase the volume of products it shipped last year, but that falling factory-gate prices in China meant revenues fell in value terms.

    He said that this deflation, which is of concern to the Chinese government, was likely to continue this year because of sluggish consumer demand in the US and Europe, and low commodity prices.

    Facing a difficult environment in its core sourcing business, Li & Fung has been expanding into areas such as ecommerce logistics.

    Revenue at its logistics arm rose 6.7 per cent last year, as it capitalised on the rapid growth of ecommerce in China, where cheap smartphones and convenient online payments systems have helped retailers expand their internet business.

    With sourcing still accounting for 95 per cent of the company’s turnover, the logistics business was unlikely to provide much respite for Li & Fung in the next few years.

    But Mr Fung said the company’s efforts to move into logistics would pay dividends in the longer term, given Li & Fung’s broad global footprint in manufacturing nations such as China, Vietnam and Bangladesh, as well as key end markets such as the US and Europe.

    “The changes happening [in] retail are impacting everyone along the value chain,” he said. “Our customers are looking to us to help them navigate these changes with innovative products and increased speed to market.”