Quarterly Results announcement form Name of listed company : Systek Information Technology (Holdings) Limited Stock code : 8103 Year end date : 31/03/2002 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 Currency: HK$'000 (Unaudited) (Unaudited) Last Quarterly Results Announcement Current Corresponding Period Period from 01/04/2001 from 01/04/2000 to 31/12/2001 to 31/12/2000 HK$'000 HK$'000 Turnover : 25,642 35,210 Profit/(Loss) from Operations : (35,206) 3,772 Finance cost : (77) (593) Share of Profit/(Loss) of Associates : 0 0 Share of Profit/(Loss) of Jointly Controlled Entites : 0 0 Profit/(Loss) after Taxation & MI : (35,054) 3,194 % Change Over the Last Period : N/A % EPS / (LPS) - Basic : -3.382 cents 0.400 cents - Diluted : N/A N/A Extraordinary (ETD) Gain/(Loss) : 0 0 Profit (Loss) after ETD Items : (35,054) 3,194 3rd Q * Dividend per Share : 0 0 (specify if with other options) : N/A N/A B/C Dates for 3rd Q* 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 : To Cho Kei 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. Notes - 1 Reorganisation and basis of presentation (a) 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. The Company became the holding company of the Group on 26 August 2000 through a reorganisation (the `Reorganisation'). (b) Basis of presentation The Group resulting from the Reorganisation has been regarded as a continuing group. Accordingly, the consolidated results have been prepared on the basis of merger accounting, under which the Company was the holding company of the Group for both periods presented, rather than from 26 August 2000. Furthermore, the results of the Group for the periods ended 31 December 2001 and 2000 included the results of the Group with effect from 1 April 1999 or since their respective dates of incorporation, whichever is a shorter period. In the opinion of the Board, the resulting consolidated results give a more meaningful view of the results of the Group as a whole. All significant intra-group transactions and balances have been eliminated in the preparation of the consolidated results. (c) Statement of compliances The consolidated results have been prepared in accordance with all applicable statements of Standard Accounting Practice and Interpretations issued by the Hong Kong Society of Accountants and accounting principles generally accepted in Hong Kong. 2 Turnover The principal activities of the Group are the provision of systems development and consultancy services and sales of software and hardware products. Turnover represents income arising from the provision of system development and consultancy services, provision of IT engineering and technical support services, provision of training courses and the sales of software and hardware products. An analysis of the turnover by principal activities of the operations of the Group during the reporting periods is as follows: Three Nine months months ended 31 ended 31 December December 2001 2000 2001 2000 HK$'000 HK$'000 HK$'000 HK$'000 Principal activites Systems 6,647 4,342 14,421 14,606 development Sales of 236 2,414 1,929 9,375 software and hardware products Professional 2,098 2,766 6,185 6,273 service fees Training 463 1,089 1,720 2,879 fees Technical 304 405 1,344 752 support fees Others 7 - 43 1,325 9,755 11,016 25,642 35,210 3 (Loss)/ profit from ordinary activities before taxation (Loss)/ profit from ordinary activities before taxation is arrived at after crediting and charging: Three Nine months months ended 31 ended 31 December December 2001 2000 2001 2000 HK$'000 HK$'000 HK$'000 HK$'000 Crediting Interest 91 1,625 948 2,154 income Charging Interest on 11 53 77 593 bank advances and other borrowings repayable within five years Staff costs 9,989 1,283 32,164 5,011 Operating 1,353 584 3,852 1,332 lease rentals - properties Pre-operatin - - 65 655 g costs written off Amortisation 24 - 72 - of deferred assets Auditors' 900 - 911 160 remuneration Depreciation 709 443 1,942 989 4 Taxation Three Nine months months ended 31 ended 31 December December 2001 2000 2001 2000 HK$'000 HK$'000 HK$'000 HK$'000 Hong Kong - - 101 taxation Overseas - - - - taxation - - - 101 Deferred - - - 263 taxation - - - 364 No provision for taxation has been made for the three months and nine months ended 31 December 2001 as the Group sustained losses for taxation purpose during the period. The provision for Hong Kong Profits Tax was calculated at 16% of the estimated assessable profits arising in Hong Kong for the three months and nine months ended 31 December 2000. A subsidiary operating in the PRC is exempted from PRC income tax for two years commencing from the first profit making year and is entitled to a 50% relief from PRC income tax for the following three years, after which the profits are subject to PRC income tax at the standard rate of 33%. No provision for taxation has been made for the three months and nine months ended 31 December 2001 since the subsidiary is still within the two-year tax exemption period. 5 (Loss)/Earnings per share The calculation of basic loss per share for the three months and nine months ended 31 December 2001 is based on the loss attributable to shareholders of approximately of HK$9,004,000 and HK35,054,000 (2000: profit of HK$1,073,000 and HK$ 3,194,000) and the weighted average number of 1,036,375,000 (2000: 1,036,375,000 and 793,944,412) shares in issue throughout the relevant accounting period, respectively. There was no potential dilutive ordinary shares in issue during the three months and nine months ended 31 December 2001 and 2000. 6 Reserves Share Exchange Retained Total premium reserves profits/ (Accumulated losses) HK$'000 HK$'000 HK$'000 HK$'000 At 1 April 33,144 (32) (21,168) 11,944 2001 Exchange (326) - (326) differences on translation of accounts of subsidiaries outside Hong Kong Loss for - - (35,054) (35,054) the period At 31 33,144 (358) (56,222) (23,436) December 2001 According to the relevant PRC accounting rules and regulations, the PRC subsidiary may appropriate part of its profits after tax to general reserve, at the discretion of the board of directors of the subsidiary. The general reserve can be used to make good losses and to convert into paid-up capital. No transfer to the general reserve was made by the PRC subsidiary during the period.