Chairman's message

In 2018, with the macro economy and property market in China facing increasing downward pressure, keeping the market stable was the priority goal of government control policies. Restriction on purchase and sale, and market supervision and control continued. Meanwhile, more flexible control measures were implemented in some key cities to stabilize the market expectation, all to the ultimate end of helping the property industry achieve healthy development in the long run. As the government has still focused on lowering risk, it spared no effort in implementing relevant measures to reduce inventory storage and improve operational efficiency of the industry, pointing to the possibility of it speeding up and mapping out a housing development plan and adjusting the residential properties and land supply structures, to provide the industry with a balanced operating environment.

Although the industry was not operating in an ideal environment, Hopefluent continued to strive to improve amid adversity, drawing on its strengths and capabilities, its years of industry experience and policy insights, and responsiveness to different market situations. It was thus able to remain resilient in the market where only the fittest could survive and delivered satisfactory results.

In 2018, the total turnover of Hopefluent amounted to HK$5,450 million, 17% more than the HK$4,672 million in 2017. Profit for the year was HK$454 million, representing an increase of approximately 33% over the HK$342 million in 2017. Profit attributable to shareholders was HK$327 million (2017: HK$337 million).

Strategy of Integrating with Internet contributed to continued business growth

To cope with changes in the market environment, Hopefluent has kept its focus on building a comprehensive ¨professional + system〃 integrated property business service chain. During the period under review, its strategy of integrating with the Internet was implemented at good pace and impressive progress were made. Through the integration of the first-hand and second-hand real estate agency service businesses of the Group and the subsidiary companies of Poly Developments and Holdings Group Co., Ltd. (¨Poly Development〃) (stock code: 600048) and the company restructuring, the Group's business has been strengthened and greatly expanded. At the same time, its Internet business and primary and secondary property real estate agency services businesses have started online and offline collaboration, sharing information and supporting each other, hence have enhanced the Group's overall competitiveness. Although the operating environment for the industry was far from ideal, the Group still managed to sustain business growth. During the reporting period, turnover of the property real estate agency services business amounted to HK$4,723 million for the year ended 31 December 2018, an increase of approximately 18%. Turnover from the primary offices was HK$3,703 million and turnover from secondary branches reached HK$1,020 million. As for secondary property real estate agency services business, with the government restricting purchases, its transaction volume was squeezed yet its market share remained solid. With a network spanning across Southern China and strategically deployed, the Group can keep marching forward and actively expand business when market starts to warm up.

Smooth diversification of business allowed advancement of services

Operating in an environment subject to continuous changes in both domestic country and abroad, in addition to tightening financial policies, the Group's financial services business has, in agreement with national policies, operated by the principles of de-leveraging and risk prevention. It has been at great strength developing assets management business, which appears to have relatively stronger growth potential. The new business targets to provide comprehensive high-end financial services to high net worth customers earning high incomes or owning huge assets, including licensed private equity funds, etc. Related diversified businesses focused on four major types of property market related investment or financing projects in the financial services segment, namely M&A of real estate, disposal of non-performing assets, operation of real estate and financing service. In addition, property management services business has also grown steadily. During the period under review, this business owned a clientele comprised residential, office and commercial properties in Guangzhou, Shanghai, Tianjin and Wuhan for property management services; and by area, it managed a total of 30 million square meters, making HK$544 million in revenue, around 4% higher year-on-year.


The Group is optimistic about the political environment for property market in 2019. This year, the government's objective is to ¨stabilize land premium, property prices and market expectation〃, which is conducive to the healthy and steady development of the property market. With the government implementing different control measures in different cities and for different property types, the property market will be able to adjust with flexibility and offer the property market with suitable liquidity, allowing home buyers with actual need to obtain higher credit ratio. Thus, transactions in the property market are expected to grow again on a more rational path and market sentiment will also improve relative to 2018.

Among all cities nationwide, major first- and second-tier cities with mature development foundation, such as those city clusters in the Pearl River Delta and Yangtze River Delta, are likely to be the first to see their markets stabilize. Hopefluent will continue to capitalize on its market leadership and align its approaches with changes in government control policies in its constant strive to seize development opportunities.

In particular, in the ¨Outline Development Plan of the Guangdong-Hong Kong-Macau Bay Area〃 (¨Bay Area〃), the area is defined strategically as a vibrant world-class city cluster, an international innovation and technology hub with global influence and a pillar pivotal to the ¨Belt and Road〃 initiative. As Guangzhou is one of the key cities in the Bay Area, it will be playing several vital roles including as an international trade center, an integrated transportation hub, a technological, educational and cultural center and an international metropolis. Boasting solid business presence in this district, the Group believes it shall be able to fully apply its competitive edges in securing state-level development opportunities, and keep reinforcing its leadership position in the property market in the Bay Area. Moreover, business of the restructuring of the Group and the subsidiary of Poly Development has been making a good start and gathering momentum, helpful for the Group in extending the reach of the ¨Hopefluent〃 brand to more cities and expanding business coverage and income source, as well as gaining yet more promising business opportunities in the market.

On behalf of the Board, I would like to thank all employees for their contributions and our shareholders, business partners, customers and investors for supporting the Group. It is with you by our side that we have the confidence to keep doing our best, delivering outstanding results and generating ever more satisfactory returns to shareholders.

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