Annual Report

Annual reports and statements




Chairman’s Statement


DEAR SHAREHOLDERS,

On behalf of the Board of Directors, I am pleased to report that the Group recorded a net profit of $6.1 million for the year ended 31 March 2004, an increase of 139% over the previous year. This result was achieved despite extremely challenging market conditions, particularly in the first half of the year, amid the dampening effect of the Sars outbreak and the war in Iraq. Because of the spectre of threats of terrorism, the trading environment remained difficult in the second half but initiatives taken to expand the businesses bore fruit with higher revenues contributing to strong operating profits in the second half.

Overall, Group turnover reached $320.2 million for the year, representing a growth of 25.1%.

The Group balance sheet continues to be strong with Shareholders’ funds rising by $8.1 million to reach a record $129.1 million. This translates into net asset value per share of $1.18 as at 31 March 2004.

DIVIDEND

The total dividend paid for the prior financial year ended 31 March 2003 was 0.625 cents per share.

In view of the satisfying results above, and to reward shareholders for their patience and loyalty, in this 25th Anniversary year of the Company, the Board has recommended a final dividend of 1.25 cents per share, and a bonus dividend of 6.25 cents per share, giving a total of 7.50 cents per share.

OPERATIONS REVIEW

South East Asia and Australia

Turnover growth of 26.0% for the region was broad based, in all the countries that the Group operates. The total turnover of $270.9 million include contributions from the new boutique in Gaysorn Plaza, Bangkok and the distribution of Montblanc products in Australia.

The Company benefited from a one-off goodwill income of $2.7 million, being compensation from one of the suppliers for excluding its distributorship in certain countries.

North East Asia

Turnover in the region grew by an encouraging 18.1% to $49.2 million. The Hong Kong market benefited from the easing of travel restrictions for residents of the People’s Republic of China, while our boutique in Tokyo continues to grow in its second year of operations, further entrenching itself in the Japanese fine watch retail market.

PEOPLE DEVELOPMENT

At The Hour Glass, we believe in bringing out the best in our people. Over the years, the Company and its team have received many accolades in recognition of its service and contribution to the Community. During this financial year, two members of The Hour Glass have been awarded The Excellent Service Award 2003 conferred by SPRING Singapore – a national award that recognizes individuals who have delivered outstanding service.

The Hour Glass also spearheaded the development of 6 skills standards for the Clock and Watch industry, under the National Skills Recognition System. This is a national framework for establishing work performance standards, identifying job competencies and certifying skills acquisition.

OTHER DEVELOPMENTS

On 18 May 2004, The Hour Glass announced a restructuring of its Jewellery retail unit under Mondial. This involves the sale of all Mondial trademarks and transfer of the retail outlet at Ngee Ann City Shopping Centre. When completed, the transaction will realize an exceptional one-time capital gain of approximately $2.9 million after expenses.

The Australian subsidiary plans to open its second Montblanc boutique in Melbourne in July 2004.

To commemorate its 25th Anniversary celebration in 2004, The Hour Glass is proud to stage TEMPUS, a five-day exhibition cum conference from 25th to 29th August 2004. This event is modeled on the presentation style of the annual watch fairs held in Basel and Geneva, Switzerland.

In addition, the venerable Houses of Breguet, Cartier, Jaeger- LeCoultre, Patek Philippe and Ulysses Nardin have created unique commemorative pieces in limited edition for The Hour Glass.

FUTURE PROSPECTS

Although the general economic outlook and growth projections for the Asia Pacific region are positive, this optimism is overshadowed with threats of terrorism, currency volatility, oil price increases, and uncertain interest rates.

The challenge ahead is to remain competitive and relevant by strengthening our presence in the market place through expansion in existing and new markets, continual development of long-term key partner relationships and alliances, and being the definitive retailer and educator of specialist watches in the region.

I am confident that the Group’s strong fundamentals will enable it to ride out the uncertainties and to remain profitable in the coming year.

ACKNOWLEDGEMENT

That the Group has performed well in a difficult year was only made possible by the efforts and contributions of many. On behalf of the Board of Directors, I would like to thank our management and front line teams for their hard work and dedication. Our gratitude is also extended to our customers, business associates, brand partners and shareholders for their continuing support.

I would like to take this opportunity to thank my fellow Board members for their guidance and wise counsel, and to welcome Dr Kenny Chan as a new member of the Board. Dr Chan takes over the helm from Dato’ Dr Jannie Tay as Managing Director with effect from 1 April 2004. Dato’ Dr Jannie Tay continues to serve on the Board as Vice Chairman (Executive). Their combined retailing and marketing expertise shall serve the Group well in the years to come.

Henry Tay Yun Chwan
Executive Chairman
10 June 2004

We’re here to help


Loading Consult A Specialist Form

Change Country

Select your country:

Share

Share via:

To find out more about our available positions, please visit our Careers page.