CHAIRMAN’S STATEMENT

TOWARDS CROSS-BORDER INTEGRATION AND COLLABORATION

Dear Shareholders,

FY2018/2019 is a year full of challenges. During the Year, we have been actively discovering industry leaders with growth prospects as core holding companies and made a breakthrough in the healthcare industry successfully. Leveraging the prudent and diverse investment strategy as well as effective risk management mechanism, the major assets of the Company has maintained the stable valuation, while the divestment scale increased significantly during the Year, leading to a solid financial performance in the volatile market.

For the year ended 31 March 2019, the revenue of the Company amounted to approximately HK$228 million, representing an increase of 81.68% as compared to HK$125 million last year; net realized gain on disposal of investments increased significantly from HK$49.11 million last year to HK$211 million; total comprehensive income increased by 30.74% from HK$196 million last year to HK$256 million. As of 31 March 2019, the net asset value further increased to HK$5.63 billion from HK$5.59 billion last year. Hence, the Company Board of Directors recommended the payment of a final dividend of HK$0.046 per share.

In the past year, the familiar business environment has changed dramatically. Globalization and free trade have met great challenges. The US-China trade war broke out and quickly spread to the fields of science and technology as well as ideology. The global economy faces great uncertainty.

However, we still have implicit faith in the long-term development of the Chinese economy. The reasons are as follows:

Firstly, China enjoys an irreplaceable position in the global industrial chain. Although the trade war may drive some companies out of China, the industries that require large-scale coordination will stay in China since a large enough capacity is required to meet global demand. In terms of scale, no economy can replace China in the short term. Maintaining the normal operation of China’s industrial chain is related to the stability and security of the global economy.

Secondly, China’s huge domestic market of 1.4 billion people is playing an increasingly important role in economic development. The increasing proportion of domestic demand can effectively resist the impact of overseas market fluctuations on China’s economy.

Thirdly, the trade war and Huawei incident will accelerate the commercial landing of 5G in China. The in-depth integration of big data, artificial intelligence, the Internet and the Internet of Things will accelerate the industrial upgrade and the birth of innovative business models, and create huge business opportunities.

In this context, OP Financial’s confidence in China remains unchanged. We will fully leverage our strong capability of investment, financing and industry consolidation to promote innovation and cross-sector integration. According to the established strategy, we will focus on the great enterprises with high investment potential as core holding companies and discover investment opportunity along with their industrial chains, which could create a long-term capital appreciation as well as mid-term and short-term returns for our shareholder.

We will place emphasis on the market player that benefited from China’s domestic demand. Among them, healthcare is one of the industries with the most rapid domestic demand growth. With the improvement of people’s living standards, the demand for healthcare services is increasing. The integration of life science, information technology, big data, and artificial intelligence will give birth to new business models and a number of emerging enterprises with broad prospects. During the Year, we made an important step forward in the healthcare industry to successfully invest in iCarbonX. At the same time, we will pay attention to other related beneficial industries.

Looking forward, OP Financial will continue the implementation of our strategy and carry out cross-border integration and collaboration, and continue to discover future leaders with growth prospects in the new economy industry and domestic demand market. Besides, we will take advantage of the listed company platform, and cross-border and cross-sector capabilities to motivate the close integration of industries, technology, and financial capital. We will strive to achieve the inherent synergies of investment strategies, maintain the liquidity of the assets at a proper level, and create diversified returns for shareholders.

ZHANG Gaobo
Chairman
25 June 2019, Hong Kong