Leo Secures a Total of HKD1.15 Billion Green Loan after Successful Completion of Third Round of Green Financing
The advent of the COVID-19 pandemic has raised notably worldwide attention on the environmental, social and governance (ESG) endeavours of business corporations. In the "14th Five-Year Plan for the Development of Circular Economy" recently released by the National Development and Reform Commission, there is a clear direction of achieving full implementation of "circular production" by 2025, encouraging industries to promote green designs and clean production, and to more efficiently integrate and apply resources. It also urges financial institutions to increase green economy-related investment and financing so as to support companies and projects related to the circular economy. As a leader in the printing industry and a first mover in ESG, Leo continued to enjoy strong support from local and international banks for this third round of Green Financing amid the pandemic. Part of the HKD400 million green loan will be used on the green construction projects in its existing plants in Mainland China and Vietnam, to strengthen energy saving and reduction of carbon emissions, waste gas, solid waste, waste water and other environmental protection facilities. Another part of the loan will be used to build a new green plant in Hunan, China that complies with the certification standards, and more stringent standards will be adopted at the plant for energy consumption, waste water and waste discharges. The aim of such efforts is to help the country promote "carbon peaking" and "carbon neutrality", while also driving the Group's business development in Mainland China.
In fact, Leo has been boosting its efforts on energy and emission reduction at its production plants in Mainland China and Vietnam over the years to help foster sustainable development of the paper products and printing industry. Since securing green loans totalling HKD750 million in 2018 and 2019, the Group has invested a few hundred million Hong Kong dollars so far in various energy saving and technological improvement projects in relation to energy efficiency management, carbon emissions reduction, waste water, waste gas control, green buildings, resource utilization and recycling of natural resources, etc. The significant results achieved have helped the Group's production bases save cumulatively close to 18 million kwh of electricity and reduce over 9,200 tonnes of carbon emissions (data as of July 31, 2020), making environmental protection and energy saving much more effective.
In addition, having been recognised as the first batch of companies eligible for Hong Kong Monetary Authority's (HKMA) Green and Sustainable Finance Grant Scheme, Leo has received subsidy that covered all its external review service expenses. Also, with the effort to promote development of green financing in Hong Kong, Leo became the first private company to obtain the Hong Kong Quality Assurance Agency ("HKQAA") Green Finance Certification in 2018. Later in 2020, the Group also won the "Outstanding Award for Green Loan Issuer - Comprehensive Green Framework - Single Green Loan (Printing & Communication Industry)" from the Hong Kong Sustainable Finance Awards 2020 organised by HKQAA. In addition to the successful approval of the HKMA's Green and Sustainable Finance Grant Scheme, it is undoubtedly a great affirmation and encouragement to Leo's promotion of green development over the years.
Mr Samuel Leung, Group Chairman, said, "2020 was a year of changes and challenges. COVID-19 pandemic which has lasted for more than a year has profound impacts on the entire society, economy, market demand and business operations. Some of the Group's businesses such as paper packaging, greeting cards and gifts, were also slightly affected last year. However, benefiting from people staying home longer particularly in Europe and the US, the Group's home entertainment products including books, card games and jigsaw puzzles had impressive growth in the slack market. With the pandemic gradually coming under control, the Group will expand the production capacity of its plants in Mainland China and Vietnam to prepare for the economic recovery."
"The pandemic has helped us realise the importance of sustainable development to a company. Thus, we have implemented timely a full spectrum of sustainable development strategies for environmental protection, social responsibility, employee protection and business excellence. Looking ahead, the Group will continue to promote environmental protection and strive to achieve the 'zero-waste factory' goal, in the hope of setting new industry standards."
Mr King Lai, CFO of the Group, said, "In spite of the uncertainties in the global and local markets in recent years, our latest Green Financing still received strong support from eight major banks. The fact that the HKD400 million four-year green term loan and revolving credit facility only took 36 days to organize - a new industry record - is a clear testament to the strong confidence the capital market has in the Group's financial strength and prospects. We are proud to have secured the funds and are grateful for the trust and recognition from the banks. Going forward, we will continue to deliver on our promise of leading the industry towards a greener future."
Mr Frank Fang, Head of Commercial Banking, Hong Kong, HSBC, said: "Building on our support for Leo Paper's Green Loan Framework established in 2018, we are pleased to participate in the Group's Green Financing projects for the third time, as it continues to embed sustainability into its operations. The banking sector plays an important role in corporates' net-zero mission. As the leading bank in the sustainable finance market, HSBC is dedicated to supporting our customers' ESG agenda and driving the transition to a low-carbon economy."
The eight banking institutions participating in the Green Financing exercise included (in alphabetical order):
Bank of China (Hong Kong) Ltd.
Citibank, N.A.
CTBC Bank Co., Ltd.
Hang Seng Bank Ltd.
The Hongkong and Shanghai Banking Corporation Ltd.
Mizuho Bank, Ltd.
The Bank of East Asia, Ltd.
United Overseas Bank Ltd.
To demonstrate its determination to realising long-term sustainable development, Leo has formulated the "Green Harmony" framework as the core policy aiming to build a green business chain from raw materials to consumers and from design to disposal. The Group also raised the barriers of the framework this year, hoping to give new impetus to its green development. For information about Leo's work in promoting sustainable development, please refer to: https://tinyurl.com/rj9v5je8
About Leo Paper Group (Hong Kong) Limited
Since 1982, the Group has engaged in business as a traditional printing company and since then, it has developed into a leading global printing communications company, providing its clients with comprehensive printing services. Over the years, the Group has continued to promote environmentally-friendly materials and cleaner production technologies. To enhance its green manufacturing capability, not only has the Group increased sourcing of "green" materials and developed products with green technologies, but it has also reduced waste and emissions and has reused resources. The Group strives to improve their environmental performance in the production and business operations to reduce the ecological footprint to help create a better future.
For media enquiries:
Name: Kay Lau
Title: Assistant Manager
Strategic Financial Relations Ltd.
Phone: (852) 2114 2239
Email: kay.lau@sprg.com.hk
Name: Emma Fung
Title: Executive Secretary
Leo Paper Group (Hong Kong) Ltd.
Phone: (852) 2535 2438
Email: EmmaFung@leo.com.hk
The electronic version of this press release is now available for download.
English version: https://tinyurl.com/7485kp3s
Traditional Chinese version: https://tinyurl.com/2dkzcvcp
Simplified Chinese version: https://tinyurl.com/j7auyyxk
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