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CHAIRMAN’S STATEMENT

Dear Shareholders,

The board of directors (the “Board”) of Top Form International Limited (the “Company”) is pleased to present the audited consolidated final results of the Company and its subsidiaries (“Top Form” or the “Group”) for the year ended 30 June 2020.

It is not an exaggeration to say since the founding of Top Form over fifty years ago, this has been the most dramatic year that we have witnessed since our formation.

The Group started the twelve months in review by managing the disruption brought on by the Sino-US trade war with the continuing shift of our global capacity from China to our plants in South East Asia. In the first six months of the past fiscal year, the Group executed on our plan, and we serviced our customers well against many disruptions to record a modest growth for our first half.

Yet, no one could have predicted the giant upheaval a health crisis would develop into a full-blown global pandemic, which by March, led to the devastation of the global supply chain and the sudden and violent cessation of economic activities around the world. In view of this, the Group took swift actions to accommodate customers’ changing needs while complying to the prevention regulations imposed by local governments of our manufacturing countries, which significantly boosted the operating costs.

During the onset of the COVID-19 pandemic, Top Form took immediate and drastic steps to manage the crisis with the aim of protecting the health of the company and our workforce while being mindful of the longer-term strategic implications of our actions, these included, making work-from-home arrangements for our central functions in Hong Kong and Shenzhen, providing personal protective equipment to all employees, suspending all non-essential projects and expenditures to preserve cash, streamlining operations and headcount, and instituting salary cut on all associates that are managerial grade and above.

These were painful yet necessary actions at the time, and because of the hard work and cooperation of all of our associates, and the unwavering support of our partners, Top Form has been able to work through the worst of this crisis while maintaining strength for what is expected to be very challenging months ahead.

While Top Form’s sales performance in fiscal year 2020 remains at the same level as last year, driven mainly by the execution of our key strategic initiatives, including the commencement of seamless product manufacturing in Thailand and ongoing efforts in expanding manufacturing capacity and footprints in South East Asia, yet, given the resurgence of COVID-19 cases around the world, we are wary of the gloomy business outlook and the disruptive operating environment we expect to see for the upcoming fiscal year.

In the early months of the pandemic, Top Form has made some fundamental changes to our operation that will continue as we recalibrate our business to stay flexible, resilient, and strong while being innovative, forward-looking, and adaptive to succeed in what we believe would be a transformative time in the global economy. As we embrace the changes ahead, I am confident that the Group will thrive as we stay focused on implementing our key strategic initiatives while staying disciplined in controlling our costs and protecting our strong balance sheet.

As Top Form goes through this dramatic part of our journey, I would like to thank the Board for providing the management their confidence and advice during some very troubling times over the past months, and to our partners for their faith and commitment to Top Form as we face these unprecedented times together.

Finally, the pandemic has revealed the tremendous character of everyone at Top Form, and I want to take this opportunity to express my deep appreciation to all the workers and associates for the hard work and sacrifice they have made throughout this year to sustain and strengthen our organisation during these extraordinary times.

 

 

Wong Chung Chong

Chairman

15 September 2020

 
 
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