Adrian Cheng Resigns as CEO of New World Development
In a significant development for the property development industry, New World Development announced on Thursday that Adrian Cheng has officially stepped down as the chief executive officer of the company. This news comes as a surprise to many, as Cheng has been a prominent figure in the company, being the grandson of the late founder Cheng Yu-tung. The company confirmed that Eric Ma, the current chief operating officer and former government minister, will be taking over the role of CEO.
The announcement was made in a filing to the stock exchange, alongside the company’s report of a net loss of HK$17.1 billion in the previous financial year. This substantial loss has raised questions about the company’s future direction and strategies moving forward. Despite the challenges, New World Development remains optimistic about its prospects under Ma’s leadership.
Adrian Cheng’s Decision to Resign
According to the company statement, Adrian Cheng decided to resign from his position as CEO to focus more on public services and other personal commitments. This move reflects Cheng’s dedication to serving the community and contributing to important causes beyond the corporate realm. While stepping down from his executive role, Cheng will continue to be involved with the company as a non-executive director and non-executive vice-chairman.
During an online press conference, Cheng expressed his gratitude to the SAR government for entrusting him with various public roles, such as chairing the Mega Arts and Cultural Events Committee and the Hong Kong Academy for Wealth Legacy. He emphasized the importance of continuous learning and personal growth, stating, “We should keep learning in life, to do the best at what you’re good at.” Cheng’s decision to prioritize public service reflects his commitment to making a meaningful impact on society.
Eric Ma’s Appointment as CEO
As Adrian Cheng’s successor, Eric Ma brings a wealth of experience to his new role as CEO of New World Development. Ma joined the company as an executive director two years ago and was subsequently promoted to chief operating officer earlier this year. His background as a former government minister under the CY Leung administration has equipped him with the necessary skills and insights to lead the company effectively.
Ma’s tenure in the government, where he served as an undersecretary for development and briefly as development secretary, has prepared him for the challenges of the corporate world. His strategic vision and leadership qualities will be crucial in steering New World Development through its current financial difficulties and positioning the company for future growth and success.
Financial Challenges and Strategic Decisions
The company’s reported net loss of HK$17.1 billion in the previous financial year has raised concerns among investors and stakeholders. This significant loss was attributed to a 34 percent drop in revenue and a sharp decline in the valuation of investment properties. The loss attributable to shareholders also widened substantially, from HK$419 million to HK$11.8 billion compared to the previous year.
In response to these financial challenges, New World Development has decided not to offer a final dividend to its shareholders. This decision reflects the company’s commitment to prioritizing financial stability and strategic investments to drive long-term value creation. Additionally, the company has entered into discussions with substantial shareholder Chow Tai Fook Enterprises regarding the potential sale of its entire stake in the Kai Tak Sports Park.
Overall, the leadership transition at New World Development and the company’s financial struggles underscore the need for strategic decision-making and effective management in navigating the complex landscape of the property development industry. With Eric Ma at the helm as the new CEO, the company is poised to overcome its challenges and emerge stronger in the competitive market environment.