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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Bluestar | LSE:BSST | London | Ordinary Share | VGG1195V1076 | ORD NPV (DI) |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 2.50 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Jun 2019 to Jun 2024
TIDMBSST
RNS Number : 6120K
BlueStar SecuTech, Inc.
31 July 2013
31 July 2013
BlueStar SecuTech Inc
Final Results for the Year Ended 31 March 2013
BlueStar SecuTech Inc. ("BlueStar", "the Company" or "the Group"), the AIM quoted (AIM: BSST) leading provider of digital video surveillance solutions in China, is pleased to announce its final audited results for the 12 months ended 31 March 2013.
Highlights for the year
-- Revenues up 5% to RMB 186 million (31 March 2012: RMB 176 million) -- Gross profit down 4% to RMB 86 million (31 March 2012: RMB 90 million) -- Gross margin down 5% to 46% (31 March 2012: 51%) -- Fully diluted earnings per share 4.47 fen (31 March 2012: 2.79 fen) (100 fen = 1 RMB) -- Profit before tax up 51% to RMB 7 million (31 March 2012: RMB 5 million) -- Cash position of RMB 27 million at year end (31 March 2012: RMB 51 million) -- No dividend will be declared in respect of financial year ended 31 March 2013
Commenting on the results, Xiao Gang, Chief Executive of BlueStar said:
"Despite the revenue and net profit of the Group in this financial year being better than the same period last year, the result did not meet management's expectation. The main reason is due to the decline in gross profit caused by rising costs, as well as an increase in interest payments on the Company's bank debts. Management of the group's receivables continues to be a challenge and working capital management is aided by the continued commitment of our banks.
"Looking at our current contracts and order book, the Company believes the business for the next financial year will benefit from an investment in expanding the group's channel sales business. The Company will keep on working hard to expand its market share, to tighten the cost control and to address working capital management."
Enquiries:-
BlueStar SecuTech, Antonia Ping CFO & Company +86 (0) 10 8225 Inc. Secretary 5855 ---------------------- ---------------------------- ---------------- Westhouse Securities +44 (0) 20 7601 Limited Richard Baty 6100 ---------------------- ---------------------------- ----------------
Chairman's Statement
The financial year 2013 has been another challenging year for our business, although we continue to win new contracts and new clients. Throughout the year, the Company has intended to increase its revenue in two ways: one is to continue to win more banking clients; the other is to grow the group's channel sales business. During the last year, the channel sales team has increased from 18 to 54 members and the team has stepped up its marketing activities with Exhibition activities and trade fairs conducted in around 30 cities to actively expand the recognition of BlueStar's brand. The group's target customers for its channel sales services are the utility and power industries, police and intelligent services.
After a whole year preparation work on channel sales, we are confident that FY2014 will see reasonable growth in channel sales. In the meantime, the group has also actively looked to control costs and tighten its cost control systems. We hope that these initiatives will create a firm foundation for the year ahead.
Our revenue and profit before tax were slightly higher than the previous year. We continue to focus our business in the banking, police, and government security agency sector and continue to provide high quality software, products and services to our customers. During the year, BlueStar was awarded ten copyrights in respect of its new software solutions for advanced networking platforms and intelligent management functions. In November 2012, BlueStar was named in the China Public Security Magazine as one of the "Ten most influential DVR brands in China 2012."
We will continue to streamline our management practices and improve operational efficiency aiming at being even more responsive to our customers' needs.
We are sincerely grateful to our customers and stakeholders for their continued long term trust and support. We would particularly like to thank our workforce for their commitment and dedication to customer service.
Liu Xiaochuan
Chairman, Non-Executive Director
Financial Review
For the year ended 31 March 2013, revenue was up on the previous year by 5% to RMB 186 million (2012: RMB 176 million) and profit after tax up by 60% to RMB 3.3 million (2012: RMB 2.0 million).
Gross profit for the year ended 31 March 2013 was RMB 86 million (2012: RMB 90 million) and average gross profit margins for the period decreased from 51% in 2012 to 46%.
The declined gross profit margin is mainly driven by rising costs which we were unable to pass through to our customers. The principal increase in input costs is expected to be short term as it was a result of devastating floods in Thailand during 2011, which have adversely impacted the technology sector across the world as it has led to higher hard disk costs. The new channel sales of equipment and IPC also contributed to lower profit margin. However it will improve the Company's cash flow in the future.
The overall operating expense has reduced by 8% as the Company has been undertaking a series of cost reductions including reducing the executive directors' salaries by 30% and the non-executive directors' salaries by 50%.
BlueStar maintained its expenditure on research and development and, as planned, during the year, the Company's investment in R&D amounted to RMB 18 million (2012: RMB 19 million) of which RMB 11 million was capitalised (2012: RMB 10 million).
During the year, BlueStar has invested RMB 1.5 million (2012: RMB 1.0 million) mainly in conjunction with our cooperation with the Kaiyuan Company ("Kaiyuan"), a partner that has been appointed by the Beijing Municipal Public Security Bureau as its sole security service provider for the financial sector in Beijing. The investment has principally been in the setting up of Kaiyuan hubs and the replacement of old office equipment and renovation of part of our production facilities.
Finance costs for the financial year ended 31 March 2013 were RMB 2.5 million (2012: RMB 1.7 million). This was largely attributable to an increase in payments of interest on bank loans during the current period.
The Company has a total of RMB 40 million short term bank loans (March 2012: 30 million) of which RMB 20 million from Bank of Beijing, RMB 10 million from China Minsheng Banking Corporation (CMBC) and RMB 5 million from each of Bank of Beijing Trust and China Merchants Bank.
Profit before tax
In view of the above, the group recorded a profit before tax of RMB 7.0 million for the year 2013 as compared with profit before tax of RMB 4.6 million for the corresponding period in 2012.
Earnings per share for the period was 4.47 fen (2012: 2.79 fen).
Trade receivables increased to RMB 77 million at 31 March 2013 (2012: RMB 63 million) and accrued income increased by 7% to RMB 177 million at 31 March 2013 (2012: RMB 166 million). During last year, RMB 185 million outstanding debtors have been received. Our rise in accrued income is directly related to the Group working with banks, government security agencies projects and contracts which result in a lengthened working capital cycle. In addition, customers in the banking sector have been slow payers historically, and as such, it normally takes the Company a longer period to collect the receivables.
For outstanding debtors which the Company has issued an invoice to the customer, the debtor days are 152 days (FY 2012: 131 days); for total outstanding debtors including accrued income, the debtor days are 500 days (FY 2012: 475 days). Despite the increase in debtor days, the cash receipts in the first quarter after the reporting period is RMB34.5 million compare to same period in previous year of RMB19.7 million. The Company has requested that banking clients change their payment policies by paying us in installments instead of paying only when the project is finished as before. Working capital management continues to be a challenge and this is an area where management are looking at ways in which improvements - specifically in collection of receivables can be made.
Inventories at the year end were RMB 41 million (2012: RMB 35 million), representing an increase in inventories to meet the demand of an increased volume of equipment & IPC sales. This has led to shorter delivery lead time and therefore improved customer satisfaction.
At the end of the financial year, the Company's cash position was RMB 27 million (2012: RMB 51 million).
The Company's total liabilities of RMB 104 million include RMB 2 million of deferred consideration relating to acquisition of KeAn in year 2010 where the performance criteria has been extended for another two years and RMB 40 million short-term bank loan (2012: RMB 30 million).
Intangible assets increased from RMB 39 million at 31 March 2012 to RMB 43 million at 31 March 2013. The increase was mainly due to the development of new software to be embedded within our equipment.
Net cash used in operating activities was RMB 22 million for the year (2012: RMB 14 million).
Operating Review
Research and Development
As a leading surveillance network solutions provider, BlueStar has continued to win customers through its proven TRENDLINE(R) series of products and comprehensive networking solutions, which are primarily supported by the Company's continued investment in R&D. During the year, the Company's investment in R&D amounted to RMB 18 million, of which RMB 11 million was capitalised. This compares to RMB 19 million being invested in the prior year, of which RMB 10 million was capitalised.
Within the year, the second-generation intelligent video analysis technology has been full-scale applied by our Company across a range of existing products within our range.
In August 2011,we released a series of HD IP cameras including a gun-type HD IP camera, mispheric and spherical HD IP camera, all of which support the 1080P HD real-time video. Making use of the digital storage technology, we have released HDVR which is compatible with analog and HD IP cameras, We have also released NVR for HD IP cameras.
In April 2013, Blustar was awarded ten copyrights in respect of its new software solutions for advanced networking platforms and intelligent management functions. The copyrights included Tulip-HD Network Video Recorder; Dave-Network Dome Camera; TulipB-HD Hybird Video Recorder; Video Quality Diagnostics System; Device Auto Finder Systerm; BPlayer4.0-Video Surveillance System; Daniel-Network Dome Camera; Victor-IR Bullet HD Network Camera; Mobile Surveillance Software based on Android System and IP Camera Simulator.
Reflecting on the success of the Company's efforts in product research and development, BlueStar was named in the China Public Security Magazine as one of the "Ten Most Influential Brands of DVR in China 2012".
Business Development
During the year the Company won several crucial contracts with state-owned banking giants throughout China as follow:
-Two contracts signed with The Bank of China worth RMB 9.60 million and RMB 18.14 million for installing surveillance equipment for ATM machines in 2012;
-A contract with the China Construction Bank-Liao Ning Branch, worth RMB 4.87 million;
-A contract with Shanghai Pudong Development Bank -Chengdu Branch worth RMB 1.67 million;
-A major contract with Bank of Beijing, Beijing Branch, worth RMB 4.96 million for approximately 165 sub-branches in Beijing, in order to build up a network between the sub-branches and the head office command center;
- A contract with China Construction Bank-Guangxi Branch, worth RMB 1.99 million;
- A contract with Bank of China-Hainan Branch, worth RMB 2.48 million to provide DVR equipment for its branch network command center; and
-New framework contracts with several Chinese banks, including Industrial and Commercial Bank of China-Fujian Branch, China Everbright Bank, China Merchants Bank, and Ping An Bank, to provide and install our leading edge surveillance equipments.
These important contracts win highlight and reinforce BlueStar's market leading position in the provision of surveillance solutions to the Chinese banking sectors.
Strategy
In the past financial year, the Group's core strategy remained focused on growth in the banking sector and government security agencies sector within China, through expansion in Tier-II and Tier-III cities.
The regulations introduced by the Ministry of Public Security ("MPS") currently require continuous video coverage of certain transactions, especially cash transactions. In particular these requirements include:
l The mandatory replacement of existing video surveillance systems by systems employing embedded DVRs after every five years to prevent systems becoming obsolete;
l A one-to-one policy, whereby every cash counter and ATM must have one exclusive camera, which must be connected to one dedicated DVR unit;
l All new systems must be DVR systems that may be connected electronically into a network.
The Directors believe that the technical demands of the banking segment are particularly stringent in terms of DVR-based video surveillance technology due to the legislative and security requirements imposed by the government and that this presents an ongoing opportunity to the Group. The banking segment includes in total 270,000 bank branches and ATMs spread throughout 30 provinces in China. The Directors believe this geographic dispersion provides good opportunities for the sale of networked DVRs as banks focus on the effectiveness and cost-efficiency of centralising their video surveillance activities. BlueStar continuously enhanced the software further by tailoring them for industry specific solutions.
The Company has also expanded its channel sales team throughout the year. The sales person increased from 18 in 2012 to 54 in 2013. It has generated RMB 11 million for the Company in FY 2013 on channel sales section.
Surveillance Command Centre
The Company's cooperation agreement with Kaiyuan marks the expansion of its business from product-driven into providing surveillance services. BlueStar and Kaiyuan have established a new surveillance command centre in Beijing using BlueStar's existing technology in conjunction with Kaiyuan's mobile security staff. BlueStar's equipments will enable Kaiyuan to provide a range of round-the-clock operational services including remote video monitoring, intercom, alarm handling and the automatic inspection of cash ATM surveillance systems to new banking outlets. In returns, BlueStar will receive a monthly fee for each financial outlet subscribing to the service.
The surveillance command center which has been established by BlueStar and Kaiyuan in Beijing has been fully operational since July 2009. To date, approximately one thousand financial outlets have been linked to the centre's services and have been charged the service fee, generating recurring service fees for the Company of RMB 2.41 million (FY2012: RMB 1.67 million) over the period.
Awards
During the year, BlueStar won a number of awards, commendations and accreditations. These include:
- November 2012: BlueStar was named as one of the "Ten most influential surveillance DVR brands in China" for the third year, in a list sponsored by China Public Security Magazine. The final list of ten companies is made up of the best performing, most innovative and highest quality products;
- November 2012: Awarded "A quality-trusted surveillance product enterprise in China" & "Famous Surveillance Product Brand in China" by Security & Protection Market Magazine;
- November 2012: Awarded the "2012 China Safe City Construction Recommendation Brand Status" by China Security & Protection Industry Association; and
- June 2012: Awarded the "AAA-level Credit Enterprise" by Beijing Security & Protection Industry Association.
Outlook
Despite the revenue and net profit of the Group in this financial year being better than same period last year, but the result did not meet the management's expectation. The main reason is due to the decline in gross profit caused by rising costs, as well as an increase in interest payments on the Company's bank debts. Management of the group's receivables continues to be a challenge and working capital management is aided by the continued commitment of our banks.
Looking at our current contracts and order book, the Company believes the business for next financial year will be getting improved with expanding channel sales business. The Company will keep on working hard to expand its market share, to tighten the cost control and to address working capital management.
CONSOLIDATED AND COMPANY STATEMENT OF COMPREHENSIVE INCOME
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Premium
Note Group Company
Year ended Year ended Year ended Year ended
31 March 31 March 31 March 31 March
2013 2012 2013 2012
RMB'000 RMB'000 RMB'000 RMB'000
Revenue 2 185,756 176,424 - -
Cost of sales (99,909) (86,596) - -
----------- ----------- ----------- -----------
Gross profit 85,847 89,828 - -
Other income 4,427 3,505 - -
Distribution costs (48,131) (51,001) - -
Administrative
expenses (33,173) (37,092) (1,301) (2,630)
Other expenses (51) (44) (20) 5
Profit/(loss) from
operations 8,919 5,196 (1,321) (2,625)
Finance cost (2,509) (1,662) (12) (25)
Investment income 611 1,111 - -
----------- ----------- ----------- -----------
Profit/(loss) before
tax 7,021 4,645 (1,333) (2,650)
Income tax expense 3 (3,767) (2,611) - -
Profit/(loss) for
the year 3,254 2,034 (1,333) (2,650)
Other comprehensive - - - -
income
Total comprehensive
income for the
year 3,254 2,034 (1,333) (2,650)
=========== =========== =========== ===========
Earnings per ordinary
share (fen) 4
Basic 4.47 2.79
Diluted 4.47 2.79
CONSOLIDATED AND COMPANY STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2013
Note Group Company
2013 2012 2013 2012
ASSETS RMB'000 RMB'000 RMB'000 RMB'000
Non-current assets
Intangible assets 43,289 39,031 - -
Property, plant and equipment 7,264 9,786 - -
Investment in subsidiaries - - 128,021 128,021
Deferred tax assets 1,234 1,393 - -
-------- -------- -------- ---------
Total non-current assets 51,787 50,210 128,021 128,021
-------- -------- -------- ---------
Current assets
Inventories 41,144 34,581 - -
Trade and other receivables 275,063 242,955 1,869 1,794
Cash and cash equivalents 26,819 51,246 349 1,076
Total current assets 343,026 328,782 2,218 2,870
-------- -------- -------- ---------
Total assets 394,813 378,992 130,239 130,891
======== ======== ======== =========
EQUITY AND LIABILITIES
Equity attributable to owners of the parent
Share capital 5 134,861 134,861 134,861 134,861
Merger reserve (7,575) (7,575) - -
Retained earnings 126,347 119,110 (8,061) (10,711)
Option reserve 294 4,408 294 4,408
Other reserves 36,817 36,817 - -
-------- -------- -------- ---------
Total equity 290,744 287,621 127,094 128,558
-------- -------- -------- ---------
Current liabilities
Trade and other payables 31,280 29,949 2,434 1,622
Short-term borrowings 40,000 30,000 - -
Income tax payable 6,671 5,974 - -
Other tax payable 18,119 18,283 711 711
-------- -------- -------- ---------
Total current liabilities 96,070 84,206 3,145 2,333
-------- -------- -------- ---------
Non-current liabilities
Deferred tax liabilities 5,938 5,104 - -
Deferred consideration 2,061 2,061 - -
-------- -------- -------- ---------
Total non-current liabilities 7,999 7,165 - -
-------- -------- -------- ---------
Total liabilities 104,069 91,371 3,145 2,333
-------- -------- -------- ---------
Total equity and liabilities 394,813 378,992 130,239 130,891
======== ======== ======== =========
CONSOLIDATED AND COMPANY STATEMENT OF CASH FLOWS
Group Company
Year ended Year ended Year ended Year ended
31 March 31 March 31 March 31 March
2013 2012 2013 2012
RMB'000 RMB'000 RMB'000 RMB'000
Cash flows from operating activities
Profit/(loss) before interest
and tax 8,851 5,410 (1,333) (2,650)
Adjustments for:
Allowance for doubtful debts 5,010 1,149 - -
Allowance for inventories 698 2,512 - -
Depreciation of property, plant
and equipment 3,966 4,195 - -
Amortisation of intangible assets 6,727 6,276 - -
(Profit)/loss on disposal of
property, plant and equipment (10) 14 - -
Share-based payment (131) (112) (131) (112)
----------- ----------- ----------- -----------
Operating cash flows before
movement in working capital 25,111 19,444 (1,464) (2,762)
Increase in inventories (7,261) (6,645) - -
(Increase)/decrease in trade
and other receivables (37,118) (26,886) (75) 7,213
Increase in trade and other
payables 1,598 3,279 812 1,424
----------- ----------- ----------- -----------
Cash (used in)/generated from
operations (17,670) (10,808) (727) 5,875
Interest paid (2,441) (1,558) - -
Income tax paid net of refund (2,508) (1,982) - -
Net cash (used in)/generated
from operating activities (22,619) (14,348) (727) 5,875
----------- ----------- ----------- -----------
Cash flow from investing activities
Interest received 611 793 - -
Proceeds of disposal of property, 12 - - -
plant and equipment
Purchase of property, plant
and equipment (1,446) (1,005) - -
Expenditure on intangible assets (10,497) (9,809) - -
Purchase of intangible assets (488) - - -
Net cash used in investing activities (11,808) (10,021) - -
----------- ----------- ----------- -----------
Cash flow from financing activities
Cash received from bank borrowings 40,000 27,000 - -
Repayment of bank borrowings (30,000) - - -
Dividends paid - (6,597) - (6,597)
----------- ----------- ----------- -----------
Net cash generated from/(used
in) financing activities 10,000 20,403 - (6,597)
----------- ----------- ----------- -----------
Net decrease in cash and cash
equivalents (24,427) (3,966) (727) (722)
Cash and cash equivalents at
the beginning of the year 51,246 55,212 1,076 1,798
----------- ----------- ----------- -----------
Cash and cash equivalents at
the end of the year 26,819 51,246 349 1,076
=========== =========== =========== ===========
CONSOLIDATED AND COMPANY STATEMENT OF CHANGES IN EQUITY- GROUP
Share Merger Retained Other Option Total
capital reserve earnings reserves reserve
RMB'000 RMB'000 RMB'000 RMB'000 RMB'000 RMB'000
--------- --------- ---------- ---------- --------- --------
Balance as at 31 March
2011 134,861 (7,575) 127,868 32,622 4,520 292,296
--------- --------- ---------- ---------- --------- --------
Total comprehensive income
for the year - - 2,034 - - 2,034
Dividends distribution - - (6,597) - - (6,597)
Transfer to statutory
reserve - - (4,195) 4,195 - -
Share-based payment - - - - (112) (112)
--------- --------- ---------- ---------- --------- --------
Balance as at 31 March
2012 134,861 (7,575) 119,110 36,817 4,408 287,621
--------- --------- ---------- ---------- --------- --------
Total comprehensive income
for the year - - 3,254 - - 3,254
Share-based payment - - 3,983 - (4,114) (131)
--------- --------- ---------- ---------- --------- --------
Balance as at 31 March
2013 134,861 (7,575) 126,347 36,817 294 290,744
--------- --------- ---------- ---------- --------- --------
CONSOLIDATED AND COMPANY STATEMENT OF CHANGES IN EQUITY - COMPANY
Share Retained Option Total
capital earnings reserves
RMB'000 RMB'000 RMB'000 RMB'000
--------- ---------- ---------- --------
Balance as at 31 March
2011 134,861 (1,464) 4,520 137,917
--------- ---------- ---------- --------
Total comprehensive income
for the year - (2,650) - (2,650)
Dividends distribution - (6,597) - (6,597)
Share-based payment - - (112) (112)
--------- ---------- ---------- --------
Balance as at 31 March
2012 134,861 (10,711) 4,408 128,558
--------- ---------- ---------- --------
Total comprehensive income
for the year - (1,333) - (1,333)
Share-based payment - 3,983 (4,114) (131)
--------- ---------- ---------- --------
Balance as at 31 March
2013 134,861 (8,061) 294 127,094
--------- ---------- ---------- --------
NOTES TO THE FINANCIAL INFORMATION
1. BASIS OF PREPARATION OF THE FINANCIAL INFORMATION
The financial information set out in this announcement, which does not constitute the statutory financial statements of the Group, is extracted from the Group's financial statements for the year ended 31 March 2013, which were approved by the Board on 30 July 2013. The auditors have reported on those financial statements and their report was unqualified.
The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards as adopted by European Union. The financial statements have been prepared under historical cost convention.
The full financial statements will be included in the Group's Annual Report. A copy of the Group's Annual Report can be obtained from the Company's website.
2. REVENUE AND SEGMENTAL ANALYSIS
The Group's revenue from continuing operations is as follows:
Revenue Revenue Segment profit Segment profit
--------------------------------- ----------- ----------- --------------- ---------------
Year ended Year ended Year ended Year ended
31 March 31 March 31 March 31 March
2013 2012 2013 2012
--------------------------------- ----------- ----------- --------------- ---------------
RMB'000 RMB'000 RMB'000 RMB'000
--------------------------------- ----------- ----------- --------------- ---------------
Sales of digital video
devices 180,233 172,317 31,157 30,668
--------------------------------- ----------- ----------- --------------- ---------------
Sales of software 541 926 393 629
--------------------------------- ----------- ----------- --------------- ---------------
Revenue from technological
service 4,982 3,181 3,534 2,149
--------------------------------- ----------- ----------- --------------- ---------------
Total for continuing operations 185,756 176,424 35,084 33,446
--------------------------------- ----------- ----------- --------------- ---------------
Central administration
and director's salaries (26,165) (28,250)
--------------------------------- ----------- ----------- --------------- ---------------
Finance income 611 1,111
--------------------------------- ----------- ----------- --------------- ---------------
Finance cost (2,509) (1,662)
--------------------------------- ----------- ----------- --------------- ---------------
Profit before tax (continuing
operations) 7,021 4,645
--------------------------------- ----------- ----------- --------------- ---------------
Analysis of the Group's assets by operating segment:
Assets Assets
--------------------------------- ----------------- -----------------
At 31 March 2013 At 31 March 2012
--------------------------------- ----------------- -----------------
RMB'000 RMB'000
--------------------------------- ----------------- -----------------
Continuing Operations
--------------------------------- ----------------- -----------------
Sales of digital video
devices 384,794 371,204
--------------------------------- ----------------- -----------------
Sales of software 1,019 1,797
--------------------------------- ----------------- -----------------
Revenue from technological
service 9,000 5,991
--------------------------------- ----------------- -----------------
Total for continuing operations 394,813 378,992
--------------------------------- ----------------- -----------------
The Group's revenue and profit before taxation were all derived from its principal activity. All revenue and results originates in the PRC and assets and liabilities are mainly held in the PRC.
All of the segment revenue reported above is from external customers.
Segment profit represents the profit earned by each segment without allocation of central administration costs and director's salaries, share of profits of associates, investment revenue and finance costs. This is the measure reported to the chief operating decision maker for the purposes of resource allocation and assessment of segment performance.
Information about major customers
Included in revenue arising from sales of digital video devices of RMB 180 million are revenue of approximate RMB 32 million and RMB 31 million which arose from sales to the Group's two largest customers.
3. INCOME TAX EXPENSE
Group
Year ended Year ended
31 March 2013 31 March
2012
RMB'000 RMB'000
Current tax:
Current tax for profit for the year 4,060 1,680
Income tax prior year adjustment (1,286) -
-------------------- --------------
Total current tax 2,774 1,680
-------------------- --------------
Deferred tax (Note 21)
Temporary differences 834 1,075
Tax losses carry-forward 159 (144)
-------------------- --------------
Total deferred tax 993 931
-------------------- --------------
Income tax expense 3,767 2,611
==================== ==============
Reconciliation of tax charge:
Group
Year ended Year ended
31 March 2013 31 March
2012
RMB'000 RMB'000
Profit before tax 7,021 4,645
==================== ==============
Tax at PRC tax rate of 25% (2012: 25%) 1,755 1,161
Factors affecting income tax charge:
Expenses not deductible 534 579
Allowance for research and development (634) (1,550)
Timing differences 993 931
Unrelieved tax losses carry-forward 426 325
Utilisation of tax losses (58) (181)
Preferential rate (1,405) (1,729)
Exempt from income tax 333 663
Prior year adjustments (1,286) -
Other adjustments 3,109 2,412
-------------------- --------------
Tax expense for the year 3,767 2,611
==================== ==============
A company is deemed to be resident in PRC if it is established in PRC or its effective management is in PRC. Residents are taxed on their worldwide income. Non-residents are taxed on PRC source income and income effectively connected with their establishments in PRC.
The Company is regarded as resident for the tax purposes in BVI. There are no applicable taxes in the BVI for the Company.
The Company's operating subsidiaries in PRC are subject to income tax rate at 25% (2012: 25%) except certain operating subsidiaries are:
i) exempt from income tax for the first three years, followed by two or three years at half of domestic rate subject to the approval of the tax authorities if the operating subsidiaries are qualified for high technology enterprise status;
ii) tax at a fixed income tax rate based on turnover.
A 10% withholding tax on dividends payable to non-tax resident companies in PRC was introduced on 1 January 2008. The 10% withholding tax may be reduced under an applicable tax treaty.
4. EARNINGS PER SHARE
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to equity shareholders of the Company by the weighted average number of ordinary shares in issue during the year.
31 March 31 March
2013 2012
RMB'000 RMB'000
Profit attributable to equity holders
of the company 3,254 2,034
Weighted average number of shares
in issue (thousands) 72,808 72,808
Diluted earnings per share
Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. The dilutive potential ordinary shares in the Company are share options. A calculation is done to determine the number of shares that could have been acquired at fair value (determined as the average annual market share price of the Company's shares) based on the monetary rights attached to outstanding share options. The number of shares calculated above is compared with the number of shares that would have issued assuming the exercise of the share options. The exercise prices for the options granted are above the average share price of the company. As a result of this there is no diluted effect. The weighted average number of shares in issue is the number of shares issued.
5. SHARE CAPITAL
The total authorised number of ordinary shares is 72,808,000 shares (2012: 72,808,000 shares) with a nil par value per share (2012: nil par value per share). All issued shares are fully paid.
2013 2012
Issued and paid up: RMB'000 RMB'000
72,808,000 ordinary shares of nil par value 134,861 134,861
======== ========
The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company. All shares rank equally with regard to the Company's residual assets.
At 31 March 2013, the Company had the following outstanding share options:
Number Exercise Date of Exercise period
price (GBP) grant
---------- ------------- ----------- ---------------------------------------
36,404 0.48 18.06.2007 18.06.2008 - 17.06.2017
---------- ------------- ----------- ---------------------------------------
15.07.2014 - 31.08.2014 and 25.11.2014
1,008,904 0.23 14.04.2010 - 31.03.2015
---------- ------------- ----------- ---------------------------------------
6. DIVIDEND
No dividend will be declared in respect of financial year ended 31 March 2013.
7. Availability of Accounts and Annual General Meeting ("AGM")
The Company's Annual Report together with a copy of the Notice of AGM will be available on the Company's website and posted to shareholders shortly. The AGM will take place at the Company's offices in Beijing, China on 16 September 2013 at 4pm Beijing Time, 9am BST.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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