EQS-News / 13/08/2016 / 12:20 UTC+8

ADVANCED CARD SYSTEMS HOLDINGS LIMITED
龍傑智能卡控股有限公司
(Stock Code: 2086)

Announces 2016 Interim Results

(HONG KONG, 12 August 2016) Advanced Card Systems Holdings Limited ("ACS" or the "Company", together with its subsidiaries, the "Group"; SEHK: 2086) announces its unaudited interim results for the six months ended 30 June 2016 (the "Period").

As a result of the global economic downturn, the Group witnessed a postponement of placement of orders by clients in the first half of 2016. For the six months ended 30 June, revenue amounted to approximately HK$57.7 million (corresponding period of 2015: HK$106.9 million). Gross profit was HK$28.9 million (corresponding period of 2015: HK$53.7 million). The gross profit margin stood at 50%, similar to that in 2015. Loss for the period attributable to equity shareholders of the Company recorded to approximately HK$19.9 million (profit for corresponding period of 2015: HK$9.4 million). Losses per share was HK 6.99 cents (earnings per share for corresponding period of 2015: HK 3.29 cents). The Board of Directors proposed not to declare an interim dividend during the period.
Considering orders on hand for the second half of 2016 and seasonality of the industry, management is optimistic of an improvement in revenue in second half of 2016.

The Group stepped up its efforts in boosting efficiency through an internal restructuring. Despite generating a non-recurring loss, such initiative is expected to bring long-term benefits to the Group. Mr. Wong Chi Ho, Co-Chief Executive Officer and Executive Director of Advanced Card Systems Holdings Limited, commented, "We concluded the plan for restructuring and expect it to be completed by September 2016. The Group's restructuring plan covered operation structure in all of its offices. This entailed the offloading of low-performing assets and certain low-margin product lines. The plan is expected to be completed successfully because the Group has extensive professional technologies and profound knowledge base, all of which reduced the labor-intensiveness of its operations. In the long run, the restructuring is expected to enhance greater productivity and cost-effectiveness across all operations and generate positive return to the Group."

Strengthening Leading Position and Exploring New Markets During the Period, the Group continued to explore new markets and projects to strengthen its leading position in the market. In January 2016, TaptoPay Limited ("TaptoPay"), a wholly owned subsidiary of the Group, signed a five year contract with a major consortium in the Philippines to be system integrator and technology provider for a new Automatic Fare Collection ("AFC") project to extend the functionality and application of the transportation fare card used in Manila's metro. The Group also completed intelligent transportation systems ("ITS") in the emerging hub of Cebu City, The Philippines. Meanwhile, the ACOSJ is due to receive its China PBOC certification in the second half of 2016, and worldwide recognized Visa and MasterCard certifications thereafter. Given the growing market for EMV bank cards, ACOSJ is a timely addition to the Group's product portfolio.

Recognition in the form of the RFID Successful Application Award The outstanding performance of ACS has been frequently recognized in the market and within the industry. In May 2016, the Group officially received recognition in the form of the RFID Successful Application Award during China's IOT Excellence Awards. The award was for the Group's electronic toll collection ("ETC") card mobile top up solution for China toll road operators. As ETC was extended to more provinces and cities in the PRC, demand for ACS's mobile card readers is expected to increase and thus generates revenue in future. Mr. Wong Chi Kit, Co-Chief Executive Officer and Executive Director of Advanced Card Systems Holdings Limited, said, "The award is not only recognition of our achievement on the solution of AFC, but also a confirmation on our development direction of ITS. I look forward to our AFC and ITS projects contributing revenue to the Group in the remaining of 2016 and beyond."

Prospects
Looking ahead, Ms. Tsui Kam Ling, Chairman and Executive Director of Advanced Card Systems Holdings Limited, noted, "The Group's advances in smart card-based, NFC, EMV and ITS technologies present growth potential. With its technology base, knowledge base, and portfolio of projects, the Group expects to be able to make greater achievements towards realizing its prospects in the aforementioned markets. Considering the expected improvement in revenue and completion of restructuring, the management is looking forward to a better operating result for second half of 2016 compared with the Period."

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About Advanced Card Systems Holdings Limited
Advanced Card Systems Limited (ACSL, a wholly owned subsidiary of Advanced Card Systems Holdings Ltd.), founded in 1995, is Asia Pacific's top supplier and one of the world's top 3 suppliers of PC-linked smart card readers . ACSL is the winner of the Product Quality Leadership Award for Smart Card Readers from Frost & Sullivan. Advanced Card Systems Holdings Limited (together with its subsidiaries, ACS; SEHK: 2086) was listed in Forbes Asia's "Best Under a Billion" list, an inter-industry list comprised of 200 top-performing publicly listed companies in the Asia-Pacific, with sales between US$5 million and US$1 billion in 2010, 2014 and 2015. ACS develops a wide range of high quality smart card reading/writing devices, smart cards and related products and distributes them to over 100 countries worldwide. Visit ACS at http://www.acs.com.hk/.

This press release is distributed by Anli Financial Communications Limited on behalf of Advanced Card Systems Holdings Limited.
Media enquiries:
Anli Financial Communications Limited
Karl Cheung 852-3956 1646 karl.cheung@anli.com.hk Candy Wong  852-3956 1641  candy.wong@anli.com.hk
Crystal Lo  852-3956 1638 crystal.lo@anli.com.hk

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Document: http://n.eqs.com/c/fncls.ssp?u=RHPPOCVFFH Document title: ADVANCED CARD SYSTEMS HOLDINGS LIMITED Announces 2016 Interim Results

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Key word(s): Half Year Results

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