PRG Holdings Berhad Annual Report 2019

ANNUAL REPORT 2019 13 CHAIRMAN’S STATEMENT cont’d The property market in Malaysia remains challenging with issues such as affordability, slower economic growth, high levels of unsold units as well as the expiry of the home ownership campaign last year. The Group has since shifted its focus into affordable property projects going forward where demand for properties priced below RM500,000 is within the affordable range of the middle income households and constitute more than 50% of our country’s population. We hope the reduction of Overnight Policy Rate by 50 basis points in first quarter of year 2020 by Bank Negara Malaysia, will spur a demand in purchase of properties during the year. We are also concerned about the disruption of global supply chain and volatility of commodity prices and fluctuation of foreign currencies as large portion of our manufactured products are exported. The pandemic has recently caused a standstill or uncertainty in demand. Retail Division is facing an extremely challenging environment with the temporary closure of malls during the lockdown and low arrival of tourists. We believe the retail industry will continue to evolve to include digital marketing as medium of sales to sustain the business. We remained cautious on our business strategies and will continue with cost rationalisation in the short-term to mitigate the pandemic risk. We will also leverage on digital marketing through various social media platforms to create brand awareness and generate more sales. The Group is also evaluating the structural impact of COVID-19 pandemic may have on its long-term business strategies and portfolio of businesses to decide the next course of action. This may include disposing of non-profitable entity to conserve the Group’s cashflow or to reallocate resources to expand existing promising product lines. We will maintain our focus and adjust our strategies, organisation and people to adapt to the rapid change of business environment. Appreciation I would like to extend my heartfelt appreciation to our shareholders, PRG’s employees, customers, and Board members for their contribution, dedication and support to the Group. While challenges remain aplenty, I am confident and happy to say that the management team has taken proactive measures to preserve and enhance our shareholders value in the long term. In view of the recent COVID-19 pandemic that not only threatened our global economic growth but our health and safety, I would like to send my thoughts out to all our shareholders, employees and customers as well as those who are close to them that have been affected by the virus outbreak. It is important that we all follow the advice of WHO and governing bodies on the measures to stay safe. My solidarity is with those who are fighting the virus and I would like to extend my support to the dedicated health professionals who put their own lives on the line in order to help save others. We hope for the best in our fight against COVID-19 and thank you for your continued support for PRG as we move beyond the virus outbreak towards recovery in 2020 and beyond. Dato’ Dr. Awang Adek bin Hussin Independent Non-Executive Chairman