TIDMUVEL
RNS Number : 3844Z
UniVision Engineering Ltd
14 December 2017
14 December 2017
RNS Announcement: The information communicated in this
announcement contains inside information for the purposes of
Article 7 of Regulation 596/2014.
UniVision Engineering Limited
("UniVision" or the "Company" or the "Group")
Interim Results
For the Six Months Ended 30 September 2017
UniVision (AIM: UVEL), the Hong Kong based Group whose principal
activities are the supply, design, installation and maintenance of
closed circuit television and surveillance systems, and the sale of
security related products, is pleased to announce its unaudited
interim results for the six months ended 30 September 2017.
Highlights:
-- Profit attributable to the equity holders increased 133% to HK$2.1m (H1 2016: HK$0.9m);
-- Revenue increased by 8.3% to HK$23.2m for continuing operations (H1 2016 HK$21.4m);
-- Major long term contract win with MTR Corporation Limited ("MTRC") announced in
May 2017 will transform the Group's revenue and profitability
over the coming years;
-- Additional MTRC work has been won in the period and after the period end.
Mr. Stephen Sin Mo KOO, Executive Chairman, commented:
"The winning of the MTR contract is transformational for the
Group and as the invoicing start to flow through the Financial
Statements we expect to be able to report significantly higher
levels of profitability that are currently being reported.
The fact that this contract was won in the face of tough
international competition, we believe positions the Group to be
competitive for subsequent large-scale projects both inside and
outside HK in the future"
For further information visit www.uvel.com or contact:
UniVision Engineering Limited Tel: +852 2389 3256
www.uvel.com
Stephen Koo, Executive Chairman
Chun Pan Wong, Chief Executive Officer
Danny Kwok Fai Yip, Finance Director
Nicholas Lyth, Non-Executive Director Tel: +44 (0) 7769 906686
SPARK Advisory Partners Limited Tel: +44 (0)20 3368 3551
(Nominated Adviser) www.sparkadvisorypartners.com
Mark Brady/Neil Baldwin
CHAIRMAN'S STATEMENT
INTRODUCTION
The Group's turnover for continuing operations has increased by
8.3% in the first six months. This increase was mainly due to the
22.7% growth in construction contracts.
With the commencement of the major project for Replacement of
CCTV Systems awarded from MTR Corporation Limited ("MTRC") in May
2017, the Board expects that the Company will achieve a substantial
growth in the business in the coming years. The full benefits of
this contract will not be visible until the next financial year,
but we will see an increase in both turnover and profit in the
second half as invoicing on this contract commences.
THE MAJOR CONTRACT WITH MTRC
As announced on 12 May 2017, the Company was awarded the major
contract worth HK$389.4m (GBP38.1m) with MTRC through tendering
("the Project"). The contract provides for the replacement works of
the Closed Circuit Television (CCTV) systems for numerous railway
lines of MTRC in Hong Kong. Under the contract, the Company will
replace the existing analogue CCTV system installed in the stations
along the specified lines with a unified IP-based CCTV system.
The Project commenced in mid-May 2017 and the completion date
for the replacement works is anticipated to be in November 2023.
Currently, the Company is working on the design stage and
commencing the installation works.
The Company acts as the main contractor for the Project.
According to the term, the Company is required to provide a
performance bond equivalent to 3% of the contract sum, i.e.
HK$11.7m. To release liquidity for the business development, the
Board has provided the performance bond to MTRC that is guaranteed
by a leading insurance company without collateral. The Surety bond
facility is provided to the Company up to HK$30 million. The
surplus amount of this facility can also be used to meet
performance bond requirements for other potential projects if
required.
The first billing to MTRC is expected in the first quarter of
2018.
FINANCIAL REVIEW
'Continuing operations' represent the Group's Security and
Surveillance Systems business undertaken by the Hong Kong operating
entity. The business undertaken by T-Com, the Group's former Taiwan
subsidiary is classified as discontinued operations following its
sale in June 2016, which completed in October 2016.
The value of the assets and liabilities of T-Com, were HK$28.3m
and HK$24m respectively which is included in the financial
statements below as Assets/Liabilities of Disposal Group classified
as held for sale as at 30 September 2016.
In the six month period under review, revenues for the Group's
continuing operations increased by 8.3% to HK$23.2m (H1 2016:
HK$21.4m). This increase was mainly due to a 22.7% growth in
construction contracts. The growth of construction revenue was
mainly due to income generated from the following contracts:-
MTRC Replacement of CCTV Systems (the Project)
MTRC East Rail Line Platforms CCTV System Enhancement
Modern Terminal Upgrade Project
Hong Kong-Zhuhai-Macao Bridge Project
Central Wanchai By Pass Project
Gross profit margin for the Group's continuing operations
reduced to 31% (H1 2016: 34%). Gross profit margin in the
maintenance business improved from 36% to 41%, compensating for a
decrease in gross profit margin of 4% to 29% (2016: 33%) in the
Group's construction business for the period. This decrease of
gross profit in construction contracts was mainly due to the
relative lower gross profit margin for the Project. In facing
increased operating costs and long-term contract period, the
Company imposes efficient control measures on human resources,
material costs, logistics and sub-contracting charges to maintain
the level of gross margin.
Administration expenses for continuing operations were decreased
by HK$743K to HK$4.7m (H1 2016: HK$5.4m). This was caused by the
one-off, legal and professional fees regarding the disposal of the
Group's Taiwan subsidiary and legal case, totally HK$629K that
incurred in year 2016.
The profit from the continuing operations attributable to the
equity holders of the Company is HK$2.1m (2016: 1.1m). Profit
before interest and income tax from the continuing operations
during the period at HK$2.1m (H1 2016: HK$1.1m) whilst the Group
recorded a profit attributable to the equity holders of HK$2.1m (H1
2016: HK$0.9m).
During the period under review, the relative weak of the HK$
against GBP has led to 7.9% depreciation in the GBP reporting
amount in the Consolidated Statement of Comprehensive Income and
Financial Position. It also the reason for the significant loss of
GBP446K on exchange differences arising on the translation (H1
2016: gain GBP287K). All figures in GBP in the Financial Statements
therefore needed to be adjusted for comparative purposes. The
financial data is also presented in HK$ to provide a comparison
with the comparative figures in 2016 that were unaffected by
exchange rate fluctuations.
BUSINESS REVIEW
Markets
The increasing demand for wireless network infrastructure is the
key growth driver for this market. The demand to replace analogue
systems with Internet protocol based systems is also expected to
boost the market. The new major contract with MTRC is a good
example of that demand shift in our market.
The Board believes that the demand for the IP cameras remain
strong. To capture the opportunities in Internet Protocol and High
Definition CCTV System technology, UniVision will continue commit
resources to develop new technologies and solutions.
While the Company has made efforts to maintain a high degree of
sustainability in its operations in Hong Kong, the Board believes
that winning the major contract from MTRC should allow UniVision to
market its brand to purchasers of similar systems outside Hong
Kong.
The Company intends to explore other market segments, such as
rolling stock business on railways, to strengthen business growth
in the Group.
Business
Under MTRC contract, the Company is providing the service for
the replacement and provision of the CCTV systems for 84 MTR
stations and 69 stops of Light Rail. Some additional and variation
orders that are associated with the main contract may be exercised
by MTRC. The first additional works of value HK$7m (GBP0.7m) for
the provision of Optical Fibre Cables for Tseung Kwan O Line Tunnel
Sections as announced on 21 June 2017 and the second additional
works of value HK$10.9m (GBP1.05m) for Integration between NSL
Station CCTV System and the Delivered System as announced on 1
November 2017 are good examples for these.
Under the major contract, the Company performs as network
service provider in the application of CCTV systems. The Board
considers the viability for the Company entering the new business
as a provider of network service and information technology in the
application in other fields.
Customers
For security of trade receivables, the Company's major customers
are public organisations and sizeable private enterprises, such as
MTRC in Hong Kong which is the Company's largest customer in this
financial period.
To avoid the concentration of customers, the Company has the
intention to diversify the base of customers particularly to the
private and domestic sectors.
PROSPECTS
The high demand for its network and high definition security and
surveillance system provides the Group with an excellent
opportunity for future growth in these markets.
The full benefits of the MTRC contract will not come through
until next year, but we do expect to see some benefit to both
revenue and profit during the second half of the year as we
commence invoicing on the Project in the first quarter of 2018.
However, the Directors expect to see a significant increase in both
revenue and profits in the second half and also for year ending 31
March 2018, when compared to the same period last year.
As there are some major infrastructure projects to be completed
in Hong Kong in the coming years, such as High Speed Rail Hong Kong
line and the Third Runway at Hong Kong Airport that the Company
will be able to tender for, it will provide the opportunity for
business growth.
Finally, on behalf of the Board, I would like to thank our
customers, suppliers, sub-contractors and shareholders for their
continued support of UniVision. I would also like to express my
gratitude to the management team and all staff for their continued
support, contribution and dedication to the Group.
MR. STEPHEN SIN MO KOO
EXECUTIVE CHAIRMAN
14 December 2017
UniVision Engineering Limited
Consolidated Statements of Comprehensive Income (Un-audited)
For the six months ended 30 September 2017
For the six months ended 30
September
2017 2016 2017 2016
HK$'000 HK$'000 '000 '000
Continuing operations
Revenue 23,224 21,440 2,298 2,008
Cost of sales (15,914) (14,118) (1,575) (1,322)
---------- --------- ------- -------
Gross profit 7,310 7,322 723 686
Other income 206 6 20 -
Other loss - (48) - (4)
Selling and distribution expenses (659) (712) (65) (67)
Administrative expenses (4,700) (5,443) (465) (510)
Finance costs - (1) - -
---------- --------- ------- -------
Profit for the period from
continuing operations 2,157 1,124 213 105
Discontinued operations
Loss for the period from discontinued
operations - (415) - (39)
---------- --------- ------- -------
Profit for the period 2,157 709 213 66
========== ========= ======= =======
Other comprehensive income
/ (loss) :
Exchange differences arising
on translation of foreign - 121 (446) 592
-------
Total comprehensive income
/ (loss) for the period 2,157 830 (233) 658
========== ========= ======= =======
Profit / (loss) attributable
to:
Equity shareholders of the
Company
Profit from continuing operations 2,157 1,124 213 105
Loss from discontinuing operations - (217) - (20)
---------- --------- ------- -------
Equity shareholders of the
Company 2,157 907 213 85
Non-controlling interests - (198) - (19)
---------- -------
2,157 709 213 66
========== ========= ======= =======
Total comprehensive income
/ (loss) attributable
Equity shareholders of the
Company 2,157 986 (233) 657
Non-controlling interests - (156) - 1
2,157 830 (233) 658
========== ========= ======= =======
Earnings per share - Basic HK Cents HK Cents Pence Pence
and Diluted
Continuing and discontinued
operations 0.5621 0.2365 0.0556 0.0222
Continuing operations 0.5621 0.2931 0.0556 0.0274
UniVision Engineering Limited
Consolidated Statements of Financial Position (Un-audited)
As at 30 September 2017
2017 2016 2017 2016
HK$'000 HK$'000 '000 '000
ASSETS
Non-current assets
Plant and equipment 696 492 66 49
Trade and other receivables 35,037 34,172 3,350 3,402
--------- ---------- ------ ------
Total non-current assets 35,733 34,664 3,416 3,451
--------- ---------- ------ ------
Current assets
Inventories 10,680 8,323 1,021 829
Trade receivables 7,264 8,979 694 894
Amount due from customers for
contract-in-progress 17,925 11,741 1,714 1,169
Deposits, prepayments and other
receivables 16,217 11,342 1,550 1,128
Cash and bank balances 4,744 9,398 454 936
--------- ---------- ------ ------
Total current assets 56,830 49,783 5,433 4,956
--------- ---------- ------ ------
Assets of disposal group classified
as held for sale - 28,278 - 2,815
Total assets 92,563 112,725 8,849 11,222
========= ========== ====== ======
LIABILITIES AND EQUITY
Current liabilities
Trade and other payables 14,058 14,349 1,344 1,429
Amounts due to customers for
contract-in-progress 17,788 15,853 1,700 1,578
Total current liabilities 31,846 30,202 3,044 3,007
--------- ---------- ------ ------
Long Term Liability
Long term liability-loan from
Shareholder 1,200 - 115 -
Liabilities of disposal group
classified as held for sale - 24,012 - 2,390
Total liabilities 33,046 54,214 3,159 5,397
--------- ---------- ------ ------
Equity
Share capital 55,034 23,980 3,891 1,698
Share premium - 31,054 - 2,193
Special capital reserve 4,188 4,188 299 299
Statutory surplus reserve - 219 - 19
Retained earnings /(accumulated
losses) 295 (2,698) 116 (236)
Translation reserve - 206 1,384 1,697
59,517 56,949 5,690 5,670
--------- ---------- ------ ------
Non-controlling interest - 1,562 - 155
----------
Total equity 59,517 58,511 5,690 5,825
--------- ---------- ------ ------
Total liabilities and equity 92,563 112,725 8,849 11,222
========= ========== ====== ======
UniVision Engineering Limited
Consolidated Statements of Changes in Equity (Un-audited)
in '000
Special Special
capital capital Statutory Non-
Share Share Retained Reserve Reserve Translation Surplus Sub controlling Total
capital premium earnings "A" "B" reserve reserve -total interest equity
'000 '000 '000 '000 '000 '000 '000 '000 '000 '000
Balance at
1 April 2016 1,698 2,193 (174) 156 143 1,125 19 5,160 154 5,314
Profit for
the year - - 430 - - - - 430 (19) 411
Exchange
difference
arising on
translation
of foreign
operations - - - - - 718 - 718 49 767
--------- --------- -------- ------------ ------------ -------------- ----------- ------------- ----------- ----------------
Total
comprehensive
income - - 430 - - 718 - 1,148 30 1,178
Disposal of
a subsidiary - - (44) - - (13) (19) (76) (184) (260)
Dividend paid - - (154) - - - - (154) - (154)
Transfer from
share premium 2,193 (2,193) - - - - - - - -
--------- --------- -------- ------------ ------------ -------------- ----------- ------------- ----------- ----------------
Balance at
31 Mar 2017 3,891 - 58 156 143 1,830 - 6,078 - 6,078
Profit for
the six
months
ended 30 Sep
2017 - - 213 - - - - 213 - 213
Exchange
difference
arising on
translation
of foreign
operations - - - - - (446) - (446) - (446)
--------- --------- -------- ------------ ------------ -------------- ----------- ------------- ----------- ----------------
Total
comprehensive
income - - 213 - - (446) - (233) - (233)
Dividend
declared - - (155) - - - - (155) - (155)
--------- --------- -------- ------------ ------------ -------------- ----------- ------------- ----------- ----------------
Balance at
30 Sep 2017 3,891 - 116 156 143 1,384 - 5,690 - 5,690
========= ========= ======== ============ ============ ============== =========== ============= =========== ================
UniVision Engineering Limited
Consolidated Statements of Changes in Equity (Un-audited)
in HK$'000
Special Special
capital capital Statutory Non-
Share Share Retained Reserve Reserve Translation Surplus Sub controlling Total
capital premium earnings "A" "B" reserve reserve -total interest equity
HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000 HK$'000
Balance at
1 April 2016 23,980 31,054 (2,033) 2,117 2,071 126 220 57,535 1,718 59,253
Profit for
the year - - 4,388 - - - - 4,388 (198) 4,190
--------- --------- -------- ------- ------- -------------- ----------- ------- ------------ -------
Total
comprehensive
income - - 4,388 - - - - 4,388 (198) 4,190
Disposal of
a subsidiary - - (1,071) - - (126) (220) (1,417) (1,520) (2,937)
Dividend paid - - (1,573) - - - - (1,573) - (1,573)
Transfer from
share premium 31,054 (31,054) - - - - - - - -
--------- --------- -------- ------- ------- -------------- ----------- ------- ------------ -------
Balance at
31 Mar 2017 55,034 - (289) 2,117 2,071 - - 58,933 - 58,933
Profit for
the six
months
ended 30 Sep
2017 - - 2,157 - - - - 2,157 - 2,157
--------- --------- -------- ------- ------- -------------- ----------- ------- ------------ -------
Total
comprehensive
income - - 2,157 - - - - 2,157 - 2,157
Dividend
declared - - (1,573) - - - - (1,573) - (1,573)
--------- --------- -------- ------- ------- -------------- ----------- ------- ------------ -------
Balance at
30 Sep 2017 55,034 - 295 2,117 2,071 - - 59,517 - 59,517
========= ========= ======== ======= ======= ============== =========== ======= ============ =======
UniVision Engineering Limited
Consolidated Statements of Cash Flows (Un-audited)
For the six months ended 30 September 2017
For the six months
ended 30 September
2017 2016 2017 2016
HK$'000 HK$'000 '000 '000
CASH FLOW FROM OPERATING ACTIVITIES
Profit before income tax for the
period 2,157 1,124 213 105
Adjustments for:
Depreciation of plant and equipment 145 109 14 10
Interest income (18) (5) (2) (1)
Finance costs paid - 233 - 22
Gain on disposal of plant and equipment (15) - (1) -
------- ------- ----- -----
2,269 1,461 224 136
Changes in operating assets and liabilities:
(Increase)/decrease in inventories (15) 28 (1) 3
(Increase)/decrease in trade receivables (2,171) 1,256 (215) 118
Increase in amounts due from customers
for contract-in-progress (3,529) (541) (349) (51)
Increase in deposits, prepayments
and other receivables (2,593) (360) (257) (33)
Increase in amounts due to customers
for contract-in-progress 514 1,733 51 162
Decrease in trade and other payables (929) (1,045) (92) (97)
------- ------- ----- -----
Cash (used in)/generated from operations (6,454) 2,532 (639) 238
Net cash used in disposal group - (3,255) - (305)
Net cash used in operating activities (6,454) (723) (639) (67)
------- ------- ----- -----
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of plant and equipment (355) (126) (35) (12)
Interest received 18 5 2 1
Decrease in pledged deposits - 18 - 2
Net cash used in disposal group - (18) - (2)
Proceeds on disposal of plant and
equipment 15 - 2 -
Net cash used in investing activities (322) (121) (31) (11)
------- ------- ----- -----
CASH FLOWS FROM FINANCING ACTIVITIES
Finance costs paid - (233) - (22)
Repayment of obligation under finance
lease - (7) - (1)
Net cash generated from disposal
group - 2,790 - 261
Net cash generated from financing
activities - 2,550 - 238
------- ------- ----- -----
NET (DECREASE)/INCREASE IN CASH AND
CASH EQUIVALENTS (6,776) 1,706 (670) 160
Less: cash and cash equivalents from
disposal group - (2,954) - (265)
EFFECT OF CHANGE IN EXCHANGES RATES - - (64) 86
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD 11,520 10,646 1,188 955
------- ------- ----- -----
CASH AND CASH EQUIVALENTS AT OF
PERIOD 4,744 9,398 454 936
======= ======= ===== =====
Notes to the Interim financial statements for the six months
ended 30 September 2017
1. Basis of preparation
The unaudited interim financial statements for the six months
ended 30 September 2017 have been prepared in accordance with
International Financial Reporting Standards ("IFRSs") using the
policies consistent with those applied to the annual financial
statements for the year ended 31 March 2017. The interim financial
statements, together with the comparative information contained in
this report for the six months ended 30 September 2016, does not
constitute the statutory accounts of the Company.
2. Profit per share
The calculation of basic profit per ordinary share is based on
the profit attributable to equity holders of the Group for the six
months ended 30 September 2017 of HK$2.1m (H1 2016: HK$0.9m), and
the weighted average of 383,677,323 (H1 2016: 383,677,323) ordinary
shares in issue during the period.
There were no potential dilutive instruments at either financial
period end.
3. Interim report
Copies of the interim report will be available for inspection at
the registered office of the Company, Unit 01A, 2/F., Sunbeam
Centre, 27 Shing Yip Street, Kwun Tong, Hong Kong and available on
the Company's website (www.uvel.com) in accordance with Rule 26 of
the AIM Rules for Companies.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR OKQDQDBDDABD
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