hmvod Limited — Earnings Release 2002

Jun 28, 2002

 
        Yearly Results announcement form

Name of listed company : Systek Information Technology (Holdings) Limited

Stock code : 8103

Year end date : 31/03/2002

Auditors' report : Qualified
Modified
X Neither
Important Note :

This result announcement form only contains extracted information from
and should be read in conjunction with the detailed results announcement
of the issuer, which can be viewed on the GEM website at
http://www.hkgem.com

                                         (Audited)        (Audited)
                                                               Last

Final Results Announcement Current Corresponding
Period Period
from 01/04/2001 from 01/04/2000
to 31/03/2002 to 31/03/2001
HK$'000 HK$'000

Turnover : 35,292 35,628
Profit/(Loss) from Operations : (54,130) (28,641)
Finance cost : (23) (592)
Share of Profit/(Loss) of Associates : N/A N/A
Share of Profit/(Loss) of
Jointly Controlled Entites : N/A N/A
Profit/(Loss) after Taxation & MI : (54,153) (28,541)
% Change Over the Last Period : N/A %
EPS / (LPS) - Basic : (5.225) cents (3.362) cents
- Diluted : N/A N/A
Extraordinary (ETD) Gain/(Loss) : N/A N/A
Profit (Loss) after ETD Items : (54,153) (28,541)
Final Dividend per Share : NIL NIL
(specify if with other options) : N/A N/A
B/C Dates for Final Dividend : N/A to N/A bdi.
Payable Date : N/A
B/C Dates for AGM/SGM : N/A to N/A bdi.
Other Distribution for Current Period: N/A
B/C Dates for Other Distribution : N/A to N/A bdi.
(bdi: both days inclusive)

                                   For and on behalf of
                                   Systek Information Technology (Holdings) Limited
                       Signature :
                            Name :          C.K.TO
                           Title :        Chairman

Responsibility statement

The directors of the Company (the "Directors") as at the date hereof hereby
collectively and individually accept full responsibility for the accuracy of
the information contained in this results announcement form (the "Information")
and confirm, having made all reasonable inquiries, that to the best of their
knowledge and belief the Information are accurate and complete in all material
respects and not misleading and that there are no other matters the omission
of which would make the Information herein inaccurate or misleading.
The Directors acknowledge that the Stock Exchange has no responsibility
whatsoever with regard to the Information and undertake to indemnify the
Exchange against all liability incurred and all losses suffered by the Exchange
in connection with or relating to the Information.

Remark:

1.
GROUP REORGANISATION AND BASIS OF PRESENTATION
(a)
Group reorganisation
The Company was incorporated in the Cayman Islands on 16 March 2000
as an exempted company with limited liability under the Companies Law
(Revised) of the Cayman Islands. Pursuant to a group reorganisation
(the Reorganisation') to rationalise the group structure in preparation for the listing of the Company's shares on the Growth Enterprise Market operated by the Stock Exchange of Hong Kong Limited (GEM'), the Company became the holding company of the subsidiaries
now comprising the Group. Further details of the Reorganisation are
set out in the Company's prospectus dated 4 September 2000.

(b)
Basis of presentation
The Company and its subsidiaries (the Group') resulting from the Reorganisation have been regarded as a continuing group. Accordingly the consolidated results have been prepared on the basis of merger accounting in accordance with the Statements of Standard Accounting Practice (SSAP') No.2.127 `Accounting for Group Reconstructions'. On
this basis, the Company was the holding company of the Group for the
financial year presented, rather than from 26 August 2000. In the
circumstances, the results of the Group for the year ended 31 March
2001 include the results of the Company and its subsidiaries with
effect from 1 August 2000 or since their respective dates of
incorporation, whichever is a shorter period. In the opinion of the
Directors, the resulting consolidated results give a more meaningful
view of the results of the Group as a whole.

The Group primarily operates in the system development sector mainly
in Hong Kong and other regions in the PRC and is subject to special
risks due to the development cost and time involved and fast-changing
environment of the sector. As a development stage enterprise, the
sustainability of the Group is dependent on its ability to
successfully implement its business development plans, which are
dependent on, among things, adequate financing being continuously
available to the Group to fund the developing operations, before
sufficient cash flows are generated from such operations. The
Directors have evaluated all the relevant facts available to them and
are of the opinion that there do not exist any material adverse
conditions precluding the Group from implementing its business
development plans. Accordingly the results have been prepared on a
going concern basis.

The financial statements do not include any adjustments relating to
the recoverability and classification of recorded assets amounts or
to amounts and classification of liabilities that might be necessary
should the going concern basis not be applicable.

All significant intra-group transactions and balances have been
eliminated on consolidation.

2.
TURNOVER
The amount of each significant category of revenue recognised in
turnover during the year is as follows:

                 2002                 2001
                 $'000                $'000

Systems development 18,933 14,637
Software and 4,583 9,990
hardware
products
Professional 9,382 7,639
service
fees
Training fees 2,394 3,362
35,292 35,628

3.
LOSS FROM ORDINARY ACTIVITIES BEFORE TAXATION
Loss from ordinary activities before taxation is arrived at after
charging

                 2002                 2001
                 $'000                $'000

(a)Finance costs

Interest on bank 23 592
overdrafts and
other borrowings
repayable within
five
years

(b) Other items
Cost of services 21,724 15,020
and merchandise
sold#

Staff costs# 64,531 55,374
Less: amount (14,286) (18,464)
capitalised as
intangible
assets

                 50,245               36,910

Research and 25,167 28,166
development
costs#
Less: amount (16,676) (22,511)
capitalised as
intangible
assets
Add: amortisation 6,875 2,251
of research and
development
costs

                 15,366               7,906

Operating lease 9,602 4,476
rentals-properties
Less: amount (1,832) (1,172)
capitalised as
intangible
assets

                 7,770                3,304

Pre-operating costs 67 236
written
off
Amortisation of 96 48
deferred
assets#
Auditors' 750 950
remuneration
Depreciation 2,617 1,441
Provision for bad 1,266 5,942
and doubtful
debts
Provision for - 2,573
foreseeable losses
on systems
development
projects
Provision for 985 -
receivable from
minority
shareholder
Provision for 5,095 3,200
diminution in value
against investment
securities

Cost of services and merchandise sold, research and development

costs, and amortisation of deferred assets include $27,243,000 (2001:
$18,727,000) staff costs. Among the total staff costs are retirement
costs of $1,980,000 (2001: $578,700) for the year ended 31 March
2002.

4.
LOSS PER SHARE
(a)
Basic loss per share
The calculation of basic loss per share is based on the loss
attributable to shareholders of $54,153,000 (2001:$28,541,000)
divided by the weighted average number of 1,036,375,000
(2001:848,922,921) shares in issue during the year.

(b)
Diluted earnings per share
There were no potential dilutive ordinary shares in issue as at 31
March 2002 and 2001.