On Thursday, November 26, 2020, TK Holdings' 2021 Strategy Conference was grandly held at the first-floor conference hall of Building J. Mr. Li Pui Leung, Chairman of TK Group (Holdings), Mr. Yung Kin Cheung Michael, Chief Executive Officer, Mr. Li Leung Yiu, Director, Mr. Cheung Fong Wa, Executive Director, and other senior executives attended the 2021 Strategy Conference. Department heads and employee representatives were also present, with colleagues from East China and Huizhou joining via video link to discuss TK Holdings' strategy and development for the new year.
As 2020 draws to a close, we first thank all company employees for their unity and collective effort in fighting the pandemic. Despite the pandemic, the company has achieved relatively good results. Looking ahead to 2021, we hope to build on this momentum and achieve even better results.
Mr. Li Pui Leung, Chairman of TK Group (Holdings), reviewed the 2020 strategy of "Prudent Progress, Deepening External Expansion and Internal Development." Due to the pandemic, the external expansion strategy has temporarily paused; for 2021, we propose the strategic goal of "Strengthening Core Foundations, Cultivating New Sources." "Strengthening Core Foundations" means continuing to deepen external expansion and internal development under new circumstances, quantifying it through a five-year plan. "Cultivating New Sources" refers to new opportunities, as TK has traditionally focused on processing and manufacturing with limited exposure to consumer end products. This means we need to think beyond our current business perspective and align with the new development pattern of domestic circulation as the main body with mutual promotion of domestic and international dual circulation, considering what investments we can make. We also need to evaluate whether our current operating model (considering cost, speed, and other factors) can compete with mainland enterprises.
"Diversification with Focus" is TK's medium to long-term development strategy. Through macro analysis and scientific research, we will identify TK's advantages and formulate a five-year plan that aligns with "Diversification with Focus." The first quantified five-year plan (2021-2025) coincides with the central government's "14th Five-Year Plan." At the group level, we hope to see progress in profit and management indicators such as sales, gross profit, net profit, and VAR per capita. The Group establishes guidelines, policies, and development directions, while general managers refine and quantify implementation based on actual conditions. We aim to avoid both over-centralization and deviation from corporate development direction. In implementing the middle platform management in 2020, we observed departmental compartmentalization and hope for future seamless cooperation, empowered processes with control points built into process mechanisms, reducing excessive administrative approvals.
Chief Executive Officer Mr. Yung Kin Cheung Michael introduced the Group's overall business development approach and objectives, continuing to advance toward becoming an expert in efficient mold operations and injection molding technology. He announced TK's long-term development goals (2022-2026) as "developing TK into a renowned listed group with market value exceeding HK$5 billion and group sales exceeding HK$5 billion"; and medium-term development goals (2019-2021) as maintaining 15% annual organic growth in existing injection molding and mold businesses, leveraging mold and injection molding technology to become a one-stop solution provider in niche product areas, including structural component design, development, production, and verification, such as Bluetooth earphones, catheters, and pipettes; strengthening capital utilization through investment and acquisitions to enhance capital returns and business development speed; external expansion and internal development through establishing overseas production bases and increasing domestic sales proportion. Viewing business development as building construction, he encouraged management to focus more on internal processes, incentive policies, and whether appropriate resources are allocated to drive relevant business development. He introduced the Group's 233 model for agile organization and mentioned that the 2021 business strategy focuses on products, technology consolidation, client leadership, and market development. For 2021 short-term development goals, TKP focuses on two dimensions. The first is geographical layout: continuing to expand TKHD East China business scale; launching TKVT Vietnam production base with production commencing within the year; and enhancing TKHZ injection molding business scale and capacity to build an independent South China division. The second is product lines: medical business as the top priority for medium-term development with corresponding resource allocation; identifying major key accounts (potentially accounting for 20-30% of business) to enhance overall operational efficiency; and gradually developing SD and HD businesses to BD scale and management with dedicated middle platform resources to drive related business. From TKM's perspective, standard molds will leverage existing advantages and enhance strategic product sales, including large molds, deformation molds, and two-color molds, while expanding related product client base. Front-end management for strategic products will be refined with market orientation and client focus, fostering organic collaboration among market, project, and production teams to drive internal improvement and flexibly respond to client needs. Middle platform functions (including technical department and procurement) will address varying needs of front-end product lines with targeted empowerment, focusing on enhancing existing product competitiveness. For precision molds, the focus will be on refining strategic products and developing target product markets while improving product and service quality stability. CE molds will enhance business throughput flexibility.
Subsequently, department heads from the Mold Fabrication, Plastic Components, Group Finance Department, Human Resources Department, Facility Planning Department, Internal Audit Department, and External Affairs Management Department-Union each shared their medium and long-term strategies and key initiatives for 2021, supporting the achievement of TK Group's medium and long-term strategy and sustained development of both divisions.
After this cascade of strategic decomposition, everyone gained a deeper understanding of TK Group's medium and long-term strategy and key initiatives for 2021. In subsequent work, the focus will be on transforming strategy into results, turning the ideal blueprint into tangible achievements. Looking ahead, while the journey is challenging, we will face new circumstances with craftsmanship spirit, continuously enhancing risk awareness, innovation capability, and insight, sharing the same destiny, goal, and action to steadily advance toward global leadership and create a better future for TK together.
Business Scope
Component Solutions
