Page 66 - EASTERN POLYMER GROUP | ANNUAL REPORT 2015
P. 66
Such event may have material adverse effect on the ability to pay dividend of subsidiaries and joint venture
Company’s profit. companies since such dividends are considered almost all
The Company places importance on such risk. Therefore, of the revenues in separate financial statement of the company.
it assigns that the company and subsidiaries must have Therefore, if the subsidiaries and joint venture companies
sub-committee which consists of executives and working are unable to pay dividend to the Company due to
team to collaborate in setting business plan and operational unprofitable results or other business reasons such as
strategy. In addition, the Company has training and reserve for business expansion or loan repayment, it will
development program to increase knowledge and skill affect the ability to pay dividend of the Company accordingly.
among its employees on regular basis. The company To mitigate such risks, the Company has implemented
believes with confidence that skilled and competent policy and plan to invest, manage and control mechanism
personnel with experiences can carry out the business for subsidiaries and/or joint venture companies by
passed on by top executives. In addition, the Company appointing individual person to hold director or executive
also provides payment in proportional to the amount of position in those companies, including setting scope of
time worked with the company in order to keep personnel responsibilities and duties thereof to ensure the high
with specific expertise. efficiency in operation and achieve good business turnover.
Risks from of the company’s main business as holding Risks from price fluctuation of ordinary shares which may
company which the operating result is depended on cause significant loss and materially affect investors
performance of subsidiaries and joint venture companies Price of ordinary shares of the Company may be fluctuated,
The Company engages in business as a holding company depending on many factors beyond the control of the
where incomes derive from holding shares in other Company as followings:
companies while it does not operate any business on its
own that creates revenues. Thus, the Company’s turnover - Attitude toward business opportunities and the
is depended on operating result and the ability to pay operation of corporate group’s business in thermal
dividend of subsidiaries and joint venture companies. insulation, automotive and packaging industry.
Possible risks come from business risks including the
ability to pay dividend of the subsidiaries and joint venture - Different between financial result and actual
companies. operating result versus anticipated financial result
At present, operating results of subsidiaries and joint and operating result by investors and analysts.
venture companies account for 100% of the Company’s
operating result. Therefore, the operating result of - Change of advice or attitude of analysts.
subsidiaries and joint venture companies play very important - Changes of terms and conditions which have an
role to consolidated gross profit. In the event that
subsidiaries and joint venture companies encounter influence on thermal insulation, automotive and
difficulties in business operation, it may have direct effect packaging industry, general economic situation,
to the Company’s overall operating result. In addition, Stock market atmosphere, or other factors.
the dividend payment of the company to its shareholders - Notifications from other companies in the same
is based on net profit as shown in Separate Financial industry.
Statement of the Company which is depended on the - Changes of market valuation and stock price of listed
companies which engage in similar business to the
Company’s.
- Severe fluctuation of stock price in the stock
exchange.
64
