This printed article is located at https://sunmoonfood.listedcompany.com/chairman_statement.html
Extracted from Annual Report 2024
Dear Shareholders,
On behalf of the Board of Directors, I am pleased to present the annual report of SunMoon Food Company Limited for the financial year ended 31 March 2024 (“FY2023/24”).
Looking back at FY2023/24, with the joint efforts of the Board of Directors and the management team, the Group has (i) raised an equity financing round, (ii) improved gross margin by approximately 50% compared with financial year ended 31 March 2023 with the Group shifting its focus to sales of products with higher gross margins. These efforts lay the ground for growth in the coming financial year.
China’s economy is still in the process of recovering from the wave-like development after three years of pandemic and restorative growth in 2023. With China’s GDP picking up in the first quarter of 2024, all economic indicators are trending in the right direction, but the macroeconomic environment is still facing uncertainty influenced by many complex and severe external factors.
At this stage, the foundation of China’s stable and improving economy is not yet consolidated, and the economic operation is still facing a lot of risks and challenges. Therefore, we have chosen to proactively reduce the import business of bringing new products into China market at this stage, and instead focus on the core categories and core customers in the Southeast Asian markets, with the aim of reducing the operational risks and enhancing the profitability performance. In order to further diversify our operational risks and increase our competitive differentiation, we have set up additional professional business teams during the financial year to further expand the export business of Chinese domestic fruits into the Southeast Asia markets, and established and expanded our existing supplier network and sales channels to increase our market share, sales channels, and brand awareness in the Southeast Asian region.
In the new financial year, the Company will continue to leverage on the strengths of our dual headquarter operations in Singapore and Shanghai, and focus on cross-border trading business among different regions by leveraging on our comprehensive operational capabilities in branding, sales channels, supply chain, and logistics accumulated over a long period of time in China and Southeast Asia markets, to enhance sales and profitability of our main business.
We recognize innovation and openness as important drivers of social progress and industry development. We intend to shift our paradigm from a traditional trading mindset and transform ourselves from a more supply chain operation framework to a framework that focuses on value creation for our core customers, a “value chain approach”.
To barge into this direction, based on the existing fresh products trading services, the Company hopes to expand into wider business territory in vertical industries and carry out more synergistic businesses, including but not limited to cold chain warehousing and logistics services related to fresh food, so as to further increase the value-added of the business and enhance the business barriers, and provide more comprehensive and professional supply chain services to our customers.
The Company is always mindful of our mission: To provide consumers with quality products with tastiness, convenience and reassurance. With this in mind, food safety is always our top priority. To this end, we have established strict selection criteria, including ESG-compliant screening criteria for origins and suppliers, etc. We are committed to selecting quality products globally, and we are taking practical actions to make life better, society more inclusive and the world more sustainable.
The economic situations in our target markets remain challenging in the new financial year. However, challenges and opportunities exist side by side, and we will focus on our existing business while facing the unknown with an innovative and open mind.
We would like to thank our management and staff for their commitment and dedication towards the Company along the way and for striving tirelessly to help bring new dimension of growth for the Company. We would like to thank our professional team for their valuable advice and patient support. We would like to extend our appreciation to our Board of Directors for their insightful guidance. We would also like to thank our business partners, shareholders for the incessant supports. I will continue our efforts for new progress in the new financial year.
Forge ahead and grow steadily and sustainably.
Mr Zhang Ye
Chief Executive Officer