Revenue Rose to HK$761.1 million with Net Profit at HK$18.8 million – – Successfully Introduces i-Sprint Products to Hong Kong Market – – Further Strengthens Foothold in Asia Pacific Market
News Release – August 22, 2011
(Hong Kong, 22 August 2011) – Automated Systems Holdings Limited (“ASL” or “the Group”) (SEHK stock code: 771), a leading IT services provider in Hong Kong, announced its interim results for the six months ended 30 June 2011. During the period under review, the Group’s revenue amounted to HK$761.1 million, up by 4.3% compared to the corresponding period last year. For the three months ended 30 June 2011, the Group’s revenue was HK$338.6 million, increased by 2.2% compared to the corresponding period last year.
In the review period, profit before income tax was HK$24.3 million (For the six months ended 30 June 2010: HK$39.5 million). Profit attributable to the equity holders of the Group in the review period was HK$18.8 million (For the six months ended 30 June 2010: HK$32.7 million). For the three months ended 30 June 2011, profit before income tax was HK$7.6 million (For the three months ended 30 June 2010: HK$10.8 million). Basic earnings per share in the review period were HK 6.03 cents (For the six months ended 30 June 2010: HK 10.50 cents). During the period under review, our increase in service revenue has led to an incremental increase in staff cost. Additional resources are being placed in investing projects and pursuit of new businesses. The acquisition of i-Sprint Innovation Pte Ltd (“i-Sprint”) during this period is an attribute to the increase of costs.
The Group maintained a healthy balance sheet with cash standing at approximately HK$194.7 million as of 30 June 2011. No debt was recorded during the period under review and the working capital ratio was 1.66:1. The Group’s order book balance was approximately HK$622.9 million, an increase of HK$72.9 million compared to the corresponding period last year.
Mr. Simon Leung, Executive Director and Chief Operating Officer of Automated Systems Holdings Limited said, “In accordance with our strategic plan, our revenue has steadily increased in the first half of the year. In the review period, we have successfully won diverse and sizable projects providing a wide range of IT solutions, managed services and IT infrastructure to our customers. After the acquisition of i-Sprint, the Group has received six orders from target customers in the banking and financial industry, all of whom have high requirements for IT security, with the majority of the orders coming from Chinese owned financial institutions. Through effective market penetration, the Group successfully introduced a full suite of i-Sprint products into the Hong Kong marketplace and laid out a solid foundation for the expansion of our customer base.”
For the six months ended 30 June 2011, product sales and service revenue were HK$460.4 million and HK$300.7 million, decreased by 1.3% and increased by 14.3% respectively against the corresponding period in 2010, and contributed 60.5% and 39.5% to the total revenue respectively compared to 63.9% and 36.1% from the corresponding period last year. For the three months ended 30 June 2011, product sales and service revenue were HK$177.0 million and HK$161.6 million, decreased by 9.7% and increased by 19.4% respectively compared to the corresponding period last year.
Commercial and public sector sales for the six months ended 30 June 2011 contributed 39.8% and 60.2% to revenue respectively compared to 46.9% and 53.1% for the corresponding period in 2010. For the three months ended 30 June 2011, commercial and public sector sales contributed 46.6% and 53.4% to revenue respectively compared to 52.1% and 47.9% for the corresponding period in 2010.
Based in Singapore, i-Sprint provides world-class credential and access management solutions. The Group acquired the entire equity interest of i-Sprint in March 2011 in order to accelerate its expansion across Asia Pacific region and strengthen its position in the Information Technology (“IT”) security market. In April 2011, i-Sprint signed a Master Software License agreement with the largest independent listed Pan-Asian life insurance group in the world. Pursuant to this agreement, all of the offices designated by the customer can avail of i-Sprint’s application security solutions at pre-negotiated terms. This transaction underscored the Group’s capability of providing secure and reliable solutions.
The Group has been constantly striking for better results in its solutions business. In view of the upward market demand for cloud computing, mobility, business intelligence and security solutions, the Group actively participates in the development of these solutions. This expertise has enabled the Group to successfully secure a breakthrough project to provide a scalable and reliable cloud solution for a government department in Hong Kong. The Group was mainly responsible for the provision of system analysis, design and configurations, enabling the government department to provide other government bureaus and departments in need of Geographical Information System (GIS) services with the requisite services and applications on this cloud platform. This cloud solution initiative also incorporated our ultimate holding company, Beijing Teamsun Technology Co. Ltd (“Teamsun”)’s market-proven GIS products in order to enhance the performance and price efficiency. With the end-to-end cloud competencies, the Group is devoted to replicating its success to other sectors. The Group’s business focus here is also in accordance with Teamsun’s strategy of assisting customers in applying the cloud technology.
With regard to the managed services, the Group continued to maintain a good relationship with long-standing and key customers. Significant deals included the continuous supply of complex and large-scale managed services to an international airline. Such services included the provision of desk side and server operations in Hong Kong and the management of thousands of desktops for all of its offices in both Hong Kong and the mainland China. The Group also successfully introduced its business to customers in other regions. The Group has been providing services to a renowned bank in Thailand since 2008 and has further secured a deal worth several million dollars recently to provide infrastructure managed services to the bank. Moreover, the Group won a long-term managed services contract to provide the subsidiary of a renowned public transport operator in Hong Kong for the management of all IT applications and infrastructure managed services and the provision of helpdesk services of its Shenzhen data centre, with the centre expected to be completed by the end of this year.
Thanks to the demand for operational efficiency enhancement and business expansion of customers in the region, the Group’s IT infrastructure business continued to maintain good performance. Significant projects won during the review period included the supply of several thousand units of hardware for a disciplinary government department for all of its offices in Hong Kong; the provision of hardware and software applications to all of an international airline company’s offices in Hong Kong and mainland China; as well as the supply, delivery, installation, commissioning and maintenance of enterprise servers and storage system and the provision of other related services for a statutory entity in Hong Kong.
The Group’s cross-territories business is growing steadily through its continuing efforts to collaborate with Teamsun. During the review period, the Group won renewal or new contracts and more sophisticated projects with a wider scope, and covered more cities in mainland China. Among these, the Group entered into a three-year maintenance services contract this quarter with a leading international bank upon securing a one-year maintenance services contract covering its offices in major cities in China last year.
Looking ahead, the Group will further explore the potential of Teamsun’s market-proven products in order to enhance existing services offerings and to flexibly address customers’ needs. As a leading IT services provider in the region, the Group will continue to strive to provide high quality services and solutions. In fact, the Procurement and Logistics Department of Automated Systems (HK) Ltd, a subsidiary of the Group, has been certified with an ISO9001 accreditation since May 2011. The Group has further extended the scope of services coverage under the ISO9001 certification in June 2011 and obtained a number of Unix-based system infrastructure certifications. Last month, the Group successfully secured a contract from a government department to provide systems integration and managed services for the e-government platform running in its data centers, which evidences the Group’s leading position amongst a host of IT service providers. We will continue to look for opportunities in managed services in the region for further business expansion.
Mr. Leung concluded, “The Group wishes to expand across the Asia Pacific region and win more contracts through the constant provision of long-standing and market-proven solutions and services in order to fulfill the needs of regional customers on various IT areas. Meanwhile, the Group expects to achieve results in the IT security market within Greater China in the near future from ongoing efforts spent on the market in the first half of the year. With a view towards growth in its service business, the Group plans to implement a more efficient project management system by lowering its software business overhead through outsourcing and strengthening of its human resources management, investing in the establishment of a software management system and standardizing of its services through the creation of a software library.”
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