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| COMPANY
PROFILE |
| Proview is a world’s
leading display devices producer, which its major
products include LCD monitors, CRT monitors and
flat-panel digital TV products. Proview was
established in 1989, and has been listed on Hong
Kong Stock Exchange since 1997. It is carrying
operation in Europe, America, Asia and other
countries. Proview is now focusing on OEM and ODM
business. Its customer profile consists of those
world’s top branded customers and channel
customers. Meanwhile, Proview is also carrying
home-branded sales business. Proview ™, MAG
™ and EMC ™ are three brand names of
the Group, which gain well recognition in market
like China, Taiwan and Brazil. |
| BUSINESS
NATURE |
| Proview’s principal
activities are in manufacture, trade and
distribution of LCD monitors, CRT monitors,
flat-panel digital TV products and display product
components. The Group commands a global retail
sales and distribution network covering about 50
countries with strong leverage of its world-class
manufacturing facilities in China, Taiwan and
Brazil. |
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| Strategies
implementing for Proview's key businesses are as
the follows: |
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| Key
Business Segment
|
Strategy
|
| Flat-panel digital TV
business |
To enlarge market share
and obtain economy of scales in production |
| LCD monitor business |
To enhance profitability
through market differentiation and introducing innovative
products |
| CORE
COMPETENCY |
| Management of Proview is aware of
the importance in building up value for the Group.
Proview is committed to achieve sales growth and
to maximize shareholders' wealth, through taking
benefit of its core competency in: |
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| - Strong distribution
network |
| - Effective supply
chain management |
| - Innovative product
design |
| - Outstanding research
and development |
| - Cost reduction in
standardization of parts and components |
| - Synergy in system
integration |
| - Well-built
relationships with vendors |
| - Responsive customer
service |
| - Strategic alliance
with upstream and downstream business partners |
| PROSPECTS |
| In the year to come,
Proview will focus on the following strategies in
order to further sharpen its leading edge : |
|
| Vertical
Integration with Tatung Group |
| Tatung
Group is a reputable business conglomerate listed
in Taiwan. It operates full-line branded home
appliance business and has direct control over one
of the world’s leading panel suppliers, Chunghwa
Picture Tubes Ltd.. Tatung Group has invested into
Proview since October 2007 and is now a strategic
investor holding 16.22% of the Group’s issued
shares. On 23 May 2008, Proview entered into three
agreements with Tatung Group, which are effective
from 24 June 2008 to 30 June 2010. According to
these agreements, Tatung Group will supply panels
to Proview with an annual cap of at least HK$3,500
million in each of the coming two years. This will
take up a significant portion of the Group’s
panel purchase and will help to secure a stable
supply of high quality panels at competitive
prices. Meanwhile, Proview will supply TV products
to Tatung Group with an annual cap of at least
HK$620 million in each of the coming two years.
This helps to further build up sales of Proview,
by taking advantage of Tatung Group’s
well-established distribution channels. The
alliance goes a further step forward, whereby
Tatung Group is committed to provide Proview with
manufacturing and processing service through its
production sites in Eastern Europe and Asia.
Tatung Group owns world-class factories in the
Czech Republic and Mainland China. This
cooperation allows Proview and Tatung Group to
combine their respective competitive advantages
and create synergy. All the above plans have begun
in June 2008. The management believes that they
will significantly enhance the Group’s
performance in the coming years. |
|
| Marketing
Focus |
| The
Group will continue to acquire further sales
growth in flat-panel digital TVs. According to
several display industry analysts, as the world is
undergoing a global economic retrenchment, the
global demand for lower-priced flat-panel digital
TVs will increase greatly. The management believes
that this opens up a tremendous opportunity for
the Group’s already well established “white
box” and “private label” ODM TV business.
The management is also impressed by the remarkable
potential of the market in Mainland China, which
is a region supported by strong domestic demand
and is expected to be less affected by the global
economic turmoil. Proview currently has solid
customer base in China, which consists of top-tier
local brands and leading retail chains of
electronic appliances. The Group will further
spend resources to enlarge its market shares in
China. In order to explore new source of income
and diversify the product mix, Proview launched a
set-top box project in Brazil during the year.
Following the commencement of digital broadcasting
in December 2007, the Group introduced to the
Brazilian market the first set-top box product,
which brings affordable digital TV solution to
Brazil. It is estimated that 60 million households
will be finally covered by digital broadcasting.
The project is expected to provide the Group with
a considerable potential income. |
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| Loan
and Working Capital Management |
| The
Group is working on a plan to improve its existing
loan structure. The management is actively seeking
borrowings and facilities with relatively longer
tenor from banks in order to reduce the Group’s
reliance on short-term borrowings. Other than
that, capital expenditure is optimized to minimize
the Group’s overall borrowings as well as the
related finance costs. Proview is continuously
negotiating with customers for the adoption of
consignment panel arrangement. Under such an
arrangement, customers will acquire and bring
along their own panels for Proview’s production.
Panels take up a very significant portion of the
Group’s production costs. Through this method,
working capital can be released from inventory for
operations. It also allows the Group to reduce its
stocks on hand, which will in turn lower the
Group’s inventory risk. |
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