Benefited from the gradual upturn in global economy, in particular Hong Kong and PRC, Symphony Holdings Limited recorded more than double our profit for the year compared with 2009, which takes into account a considerable revaluation gain on investment properties and return on favourable investment market. Profit attributable to owners of the Company reached HKD87.9 million, representing an increase of 389% over the past year. Revenue increased by 9% to HKD1,947.5 million and gross profit maintained a steady growth of 4% to HKD362.0 million. The results testified our insightful overall business and investment strategies in the previous years, as well as our striving to strengthen business efficiency to enhance shareholder value.

In 2010, the branding business of the Group was picking up its momentum. The improvement in financial performance, the dedicated management as well as strategic alliance gave the Board the confidence to the enormous opportunities of branding and retailing segments.

With the implementation of efficacious restructuring and cost control measures, the business and operations of Pony and Haggar improved steadily. During the year, Pony focused on its licensing business. Currently, Pony reaches 30 countries spreading over Asia, Europe, North and South Americas. The licensee network continues to expand. Pony’s Archive footwear collection received high recognition and strong reputation in the market. The business of Pony in China continued to perk up by doubling its turnover compared with last year. The number of points of sale increased to 180, which are situated in strategic locations of first and second tier cities in China, in addition to 2 online shops.

During the year, Haggar recorded an increase in revenue by 8% and a net income of USD12.2 million for the first time since our investment in 2005.

In 2010, the business of Speedo in China noted a significant increase in annual turnover by 45% while gross profit improved by 28%. This improvement is due to the increase in number of points of sale and enhanced marketing efficiency. From the time when Berghaus entered into the PRC market in 2009 summer, the brand gained its recognition which gave rise to a surge in its yearly turnover. Helly Hansen, having its first flagship store opened in Beijing in 2010, was expanded to 6 direct managed stores during the year, achieving a handsome gross margin of 71%. The Group continued the expansion of its Mango stores. During the year, 5 additional Mango stores were opened in strategic locations in the PRC. The turnover of Mango climbed 51% through the operation of a total of 7 Mango stores.

Annual turnover of JFT in 2010 surged 446% as compared to 2009. As correctly perceived by the Group, the operation was increasingly recognised as a hub for trendy retail fashion in Hong Kong. Selected popular brands of Shibuya 109 and voguish Japan accessories landed key cities in the PRC during 2010, including Shanghai, Tianjin, Chengdu and Shenyang. There are plans to further expand the number of points of sale nationwide in China. The Group expects that with the rise of disposable income and the growing aspiration of the PRC market for stylish consumer goods, designer products will be favourably perceived. In the third quarter of 2010, JFT’s affiliate successfully opened its first EDWIN flagship store in Shanghai. EDWIN is preparing to launch a territory-wide campaign to maximise the brand’s presence in the PRC market.

In early 2011, Mitsubishi Estates Co., Ltd, one of the pioneers of outlet mall players in Japan, gave their recognition to our outlet mall strategy and formed a joint venture with us for the development, management and operation of the Park Outlet. Park Outlet is the Group’s flagship upscale outlet mall of international standard which would create unique and worldclass shopping experience for consumers aspiring for premium lifestyle. Offering an attributable gross floor area of approximately 60,000 square metres, the mall is targeted for completion by 2012. We believe that the joint venture will benefit Park Outlet through the unique experience, extensive system and network exchanges contributed by both the Group and MEC. The joint venture is strategically significant for the Group as it provides a platform for the Group’s long-term and sustainable growth in the industry. Foundation work and preliminary leasing works of Park Outlet are underway.

The Group further acquired 2 parcels of land in Shenyang through public auction in January 2011 for commercial and residential complex developments. Given that the Group perceives a continued and enormous development potential in the real estate market, Symphony continues to explore opportunities and forge suitable and competent partners to develop and invest in properties in Hong Kong and PRC.

During the year, footwear manufacturing division continues to be the major contributor to the Group’s operating earnings. The revenue increased by 10% to HKD1,869.4 million subsequent to the picking up of momentum at the production lines in Vietnam. Being affected by the pressure on escalation of salaries in the PRC and Vietnam, surge of raw materials cost as well as the appreciation of Renminbi and New Taiwan Dollars, gross margin slightly dropped by 120 basis points to 17%. Taking advantage of the favourable operational environment in Vietnam, the Group expects that meaningful earnings will be generated from 2011 onwards.

Along with steady global economy recovery, Hong Kong and the Mainland China markets continue to be strong. Despite there is significant growth in revenue generated in these favourable markets, the Group faces a number of challenges. Keen competition on domestic demand in China, along with global instability and exchange rate fluctuation are the factors boosting operating cost and pressuring exports. Symphony remains cautiously optimistic. Nevertheless, the Group continues to leverage its resources to improve its market presence, profitability and sustainability. Through consistent business growth and strategic alliance, we are confident that our shareholders and investors shall be rewarded by the Group’s momentous returns on its tactical investments.