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Continuation of the Diversification StrategyThe current financial year had started on an eventful note. Depending on the duration, the war in Iraq will have both short and long term consequences for the global economy. The outbreak of Severe Acute Respiratory Syndrome (¡§SARS¡¨) is starting to dampen business activities in the region. These two events are expected to result in challenging overall business conditions in the first half of 2003. Under challenging circumstances, the Group will continue to remain focused in executing its diversification strategy to gain market share in FY 2003. Fortunately for us, both the war in Iraq and SARS are not expected to have any negative impact on the Group in FY 2003. To-date, the outbreak of SARS has resulted in a short-term positive impact, whereas the war in Iraq should contribute to longer term demand for medical consumables. SARS-related demand for medical consumables such as surgical masks and disposable isolation gowns surged in March 2003. |
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| SARS-related
buying has presented the Group with a timely opportunity to further develop
its distribution channels to major hospitals in the region. With a leaner
cost structure and access to China as another low cost manufacturing centre,
OPM is in a strong competitive position to meet new orders from existing
as well as new customers in USA and Europe.
The Group will channel additional marketing resources to expand the growing European market in FY 2003. In the Philippines, the Group is targeting higher sales of medical consumables to institutions that have been encouraged by the government to buy locally made products. In Hospital Services, the Group will continue to capitalise on its entrenched position as the leading supplier of hospital linen and laundry services in Taiwan to further expand market share. Current year focus includes the cross selling of medical consumables to these hospital customers in Taiwan, as well as expanding such hospital services to the Philippines.Under the present environment, it remains a challenge to forecast current year prospects. Notwithstanding market uncertainties, we believe the Group is well positioned to grow its core businesses. Barring unforeseen circumstances, we expect the Group to perform better in the current year.
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