The Group reported a loss on disposal of its shareholding in Beijing Advanced Digital Information Technology Co., Ltd ("ADT BJ"), resulting in an increase in net loss attributable to shareholders increasing to HK$35,672,000 from a net loss of HK$26,853,000 in 2004. Loss per share were HK6 cents, compared with a net loss of HK5 cents per share last year.
The Group's business portfolio has been re-defined with the acquisition of Acacia Asia Partners Limited ("Acacia") announced in August 2005 and the option taken on exchange of all the shares it held in ChinaCast for shares in Great Wall in September and the disposal of ADT in November 2005.
Subsequently after the close of the financial year, the Group announced the acquisition of the entire share capital of Grand Panorama Limited, a property consultancy agency in Shanghai, for HK$30 million.
Mr Chan Tze-ngon, Chairman of the Group said: "To reflect the Group's latest structural changes and business nature as a holding company, a new corporate identity and name - Venture International Investment Holdings Limited - was proposed in January 2006. Ultimately, the Group will become an integrated investment group with three business streams - the existing ATM maintenance service through TopAsia, the provision of computer technology services primarily to property agency business in Shanghai through Acacia, and real estate consulting services through Grand Panorama upon completion of the transaction."
TopAsia remains a core operation of the Group, targeting at the provision of repair and maintenance services to self-service facilities to the banking and finance sector of China. The TopAsia team remained highly focused and was able to achieve a turnover of HK$120,183,000 and a net profit growth from the previous year.
This core business of the Group continued to lead in the marketing and sales of ATMs in China. Orders in the amount of RMB40 million were obtained from Postal Bureaus of Hubei and Zhejiang, BOC Jiangsu Branch, Bank of Shanghai, Nanjing City Commercial Bank, and the Shenzhen, Beijing and Xining Branches of CMB.
TopAsia's cooperation with UTStarcom, the inventor of "Little Smart" (or Xiaolingtong) mobile services, continued to bring mutual benefits to both parties. Orders in the amount of RMB22 million were secured for the provision of peripherals to IPTV multi-media workstations. Cooperation with EMC also produced orders of RMB16 million for the Industrial Bank's Head Office, Anhui Mobile and Zhejiang Unicom. A 10% growth target has been set for 2006.
The newly acquired Acacia is primarily a provider of IT management, online and support services as well as Internet portal and data management services to property agencies in Mainland China. It focuses on providing web-based platforms to small to medium-sized property agencies in accessing key information in respect of the property market and potential investors in China, initially in Shanghai.
At the time of the acquisition, Acacia had already secured a service contract with a reputable growing property agency in Shanghai as a steady income source. Since, three new customers have been secured.
Another acquisition target, Grand Panorama, is a property consultancy agency in Shanghai. Turnover of the company's real estate agency services business has been among the sector's top five in Shanghai for the past couple of years and the Group believes that the fast growing affluence of the middle class in the city will continue to drive demand and buoy the development potential of this new investment.
2005 saw the Group's divestments in ADT. In September 2005, the Group announced the disposal of its entire 55% shareholding in the software vehicle ADT BJ for RMB27 million (HK$26 million) to another substantial shareholder of ADT. As ADT (Hong Kong) is now a dormant operation, application for de-registration is being made and this is expected to come into effect in the middle of 2006.
The Group had arrived at the decision after careful consideration of the related unfavorable business environment in China, primarily fierce competition and reduced IT spending among customers - and the loss-making status of ADT BJ. The Directors believe that the time and resources previously allocated to ADT BJ could be more profitably deployed for greater shareholder gains. The Group recorded net sales proceeds of HK$24.4 million from the disposal.
Also in September, the Group announced the undertaking to exchange its 14.96% shareholding in the Singapore-listed ChinaCast, a provider of technology services by using satellite, with 3,103,543 shares ("Consideration Shares") in Great Wall which is being traded over-the-counter on NASDAQ in the US.
Based on the closing price of Great Wall on September 13 before the announcement, the Consideration Shares were valued at HK$128.3 million, representing 11.81% of the enlarged issued share capital of Great Wall. If approval is obtained within the deadline, the transaction will be completed in the second half of 2006 and the Group will achieve a gain of HK$60 million from the deal.
Great Wall is principally engaged in effecting mergers, capital stock exchanges and asset acquisitions. It intends to focus its initial target search on technology, media and telecommunications businesses in China. The Directors believe that an investment in NASDAQ-listed shares is of higher potential in value appreciation.
Mr Chan continued: "With the new business fundamentals we believe that the Group is now more positively poised to secure favorable yields for the shareholders. The year ahead is one of actively integrating Acacia into the core operation of the Group, aggressively developing TopAsia, proactively looking for new investments of potential, and optimizing the business constitution of the Group, including the newly acquired real estate agency business of Grand Panorama upon completion of the transaction."
Financial Highlights| Year ended December 31, | ||
| 2005 | 2004 | |
| HK$ '000 | HK$ '000 | |
| Turnover | 225,108 | 237,842 |
 Continuing operations |
128,884 | 237,842 |
| Discontinued operation |
96,224 | - |
| Gross Profit | 17,119 | 27,165 |
| Continuing operations |
8,894 | 27,165 |
| Discontinued operation |
8,225 | - |
| Net (loss) attributable to shareholders | (35,672) | (26,853) |
| Basic (loss) per Share (HK cents) | (6) | (5) |
About TVH Issued by : Through :
Technology Venture Holdings Limited (HKEx: 61) is an integrated investment group with three business streams - ATM maintenance service through TopAsia, the provision of computer technology services primarily to property agency business in Shanghai through Acacia, and real estate consulting services through Grand Panorama.
Technology Venture Holdings Limited
t6.communications limited
Jenny Lee or Angus Ho
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URL : http://www.t6pr.com