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Such issues increase the operating costs of the group which may adversely impact Swore Pacifism's results of operations profitability. Swore Pacific has operations in Asia, Europe and North America. Despite having a global presence, the group's operations are concentrated in Asia, mostly in Hong Kong. During PAYOFF, the group generated about 89. 4% of its revenues from Asia out of which 51. 3% were generated from Hong Kong only. Overconfidence on one geographic region makes it susceptible to changes associated with the economic and political situation of the country.Concentrated operations could also make Swore Pacific uncompetitive against rivals who have globally diversified operations. Partnerships and Joint ventures enhancing business The group is expanding its presence through partnerships and Joint ventures. In December 2013, Swore Foods Holdings Limited, a subsidiary of Swore Pacific, formed a 60/40 coffee Joint venture for Hong Kong and Mainland China with Movements Foods Lic ensing, a subsidiary of Movements Holding GAG.Movements Foods Licensing will contribute its brand and its coffee expertise to the new company, while Swore Foods Holdings will provide an area-wide distribution network and its knowledge of the Mainland Chinese market. Similarly, Swore Properties, through Marvel Glory Limited, a joint venture company formed with other partners, entered into an agreement to acquire a wholly-owned subsidiary of CITE Pacific Limited which indirectly owns DC Commercial Centre, in December 2013. These Joint ventures could enhance the group's business and improve its market share.Increasing spending on food in merging markets As the global economic shift towards the emerging economies continues, opportunities for several industries including the food and beverage manufacturing sector are created. According to industry estimates, approximately 58% of processed food is consumed by developing countries, owing to factors like a rapid increase in population in th ese countries. Furthermore, by 2050, it is expected that nearly 72% of the food consumption will happen in the developing countries supported by the fact and India. Swore Pacific derived 21% of its total revenues in PAYOFF through its beverages segment.The beverages segment of the group has the rights to manufacture, market and distribute the products of the Coca-Cola Company in Hong Kong, Taiwan, seven provinces in Mainland China and in the western US. Counting on these huge markets being created, companies like Swore Pacific are increasing their investments in emerging countries and looking at expanding their businesses. This trend of increasing spending on food in emerging markets is likely to increase the group's Beverages business. Page 6 As a global business, Swore Pacific is vulnerable to several local business risks in different countries.The group may increasingly become exposed to changing political, social, legal and regulatory obligations at the national and internationa l level, such as those required by the European Union or the World Trade Organization. These regulations include changes in tariffs and trade barriers; competition law requirements, such as restrictions on the group's ability to own or operate subsidiaries or acquire new businesses in certain Jurisdictions; delays in the process of obtaining or maintaining licenses, permits and governmental approvals necessary to operate certain businesses; and environmental laws and regulations.These regulations could have an adverse impact on the group's strategic planning and geographic expansion. Swore Pacifism's principal business operations face significant competition across the diverse markets in which they operate. New market entrants, intensification of price competition by existing competitors, product innovation or technical advancement could adversely concern the group's financial condition and results of operations. The group faces several competitive risks across its divisions.In mari ne services division, with a large number of newly built vessels continuing to enter the offshore racket, increased competition is expected to result in further pressure on charter rates. This could result in a decline in Swore Pacifism's revenues. Similarly, in the property business, an increasing number of developers are undertaking property investment and development in China, which could result in lower returns achieved on the group's property developments.Intense competition in the group's key divisions could impact the group's financial condition and results of The demand for petroleum and related products has historically been cyclical and sensitive to the availability and prices of oil and related feedstock. Historically, international prices of crude oil and refined products have fluctuated widely due to many factors that are beyond the control of companies like Swore Pacific, which has substantial interest in the aviation business through Catchy Pacific group, the HASTE gr oup and YACHT.Fuel prices and availability are subject to wide price fluctuations based on geopolitical issues and supply and demand, which can neither be controlled nor accurately predicted. The high Jet fuel price had a major impact on Catchy Pacifism's operating results in 2012. Regardless of the effect of fuel hedging, Catchy Pacifism's fuel costs increased by HOOK$323 million ($41. 6 million) (or 0. 8%) in 2012. The Jet fuel price, which was $12. 7 per million British thermal unit (Btu) in 2009 is expected to reach $23. 7 per million Btu in 2015.It is further forecast to grow to $27. 6 per million Btu by 2030. Furthermore, the political turmoil in the Middle East has impacted the oil prices. Page 7 Historically, fuel costs have generally represented 10% to 15% of an airline's operating costs, but due to volatility in prices over the past few years, fuel costs have been in the range of to 40% of total operating costs. Thus the increase in global ND regional oil prices exposes th e group to extreme fluctuations in earnings, which is likely to have an adverse consequence on its growth initiatives.Any inability to obtain Jet fuel at competitive prices would materially have an impact on Swore Pacifism's results of operation and financial condition. Page 8 Copyright of Swore Pacific, Ltd. SOOT Analysis is the property of Marketing, a Denominator business and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use.