TIDMGLOK
RNS Number : 3697S
Global Lock Safety (Intl) Grp CoLtd
23 September 2014
Global Lock Safety (International) Group Co., Limited
("Global Lock" or "Company")
Interim results for the six months ended 30 June 2014
Global Lock, the provider of security solutions to retailers and
other organisations in China, is pleased to announce its unaudited
interim results for the six months ended 30 June 2014.
The exchange rate on 23 September 2014 was GBP1 to RMB
10.0595.
Highlights:
l Revenue for the period RMB 41.73m (2013:RMB42.07m)
l Profit for the period RMB 2.31m (2013: profit 1.75m)
l Net assets (including non-controlling interest) of RMB 54.26m
(2013: RMB 48.35m)
l Cash and cash equivalents RMB 5.02m (2013: RMB 5.48m )
l Loss per share RMB 0.003 (2013: loss per share RMB0.004)
Mr. Moxiang Li, Group CEO, commented: "I am pleased to be able
to report our results for the 6 month period ended 30 June 2014.
These results are pleasing as we have maintained a broadly similar
level of revenue as the corresponding period in 2013 but at the
same time increased our profit for the period by 32% to RMB 2.31m.
This is largely attributable to the cost saving and operational
efficiency measures that we have put in place over the last 12
months. As part of this. we are currently in the process of
evaluating our AIM listing in order to ensure that it continues to
be of benefit both to Global Lock and its shareholders. Further
announcements will be made at the appropriate time."
Further Enquiries:
Global Lock Safety (International) Group
Mr. Moxiang LI, Chief Executive Officer Tel:+86 755 86556800
Mr. Andrew Gee, Non-Executive Director Tel:+44 777 565 3564
Allenby Capital Limited Tel: +44 203 328 5656
Mr. Nick Naylor
Mr. Alex Price
CHAIRMAN'S STATEMENT
As at June 30 2014, the Company's revenues were RMB41.73m,
broadly in line with 2013's half year revenues of RMB 42.07m. As at
June 30 2013, Global Lock had 72 branches, 31,165 customers and
1,022 employees. Theses compare with the first half year of 2013 as
shown in the following table:
30 June 2014 30 June 2013 % increase
No. of branches 72 72 0
------------- ------------- -----------
No. of customers 31,165 26,833 16.1%
------------- ------------- -----------
No. of employees 1,022 1,191 -14.2%
------------- ------------- -----------
Revenues (RMB million) 41.73 42.07 -0.71%
------------- ------------- -----------
The improved performance in the first half year of 2014 is
attributable to the following factors:
l a significant improvement in revenue quality due to strict
control of receivables;
l better customer service following customer visits to gain
feedback;
l staffing optimisation coupled with efficient performance
assessment, and improved operational procedures as well as the
simplification of approval processes;
l efficient execution of the branch incentive system and an
overall upgrade of technology; and
l a general improvement in operational efficiency
Milestones and achievements
The Group held its Annual Planning Meeting in Changsha from 9 to
11 January 2014 to review the achievements of 2013 and to plan for
2014, as well as to determine the operating targets for the
forthcoming year. Attendees included the Group's Chairman, members
of Senior Management, and Branch Managers and accountants.
Outstanding branches were rewarded for achieving exceptional profit
levels, in meeting their operating targets and for attaining
excellent security service levels. In addition, numbers of
high-achieving individuals were also rewarded.
The Company completed the construction of its Master Alarm
Response Centre located in Shenzhen, which now receives and handles
alarms from all branches and issue instructions to guard patrols.
The centre has the capacity to provide alarm response and
processing services for more than 500,000 clients at the same time
and has already resulted in cost savings. At the same time, alarm
response efficiency is improving through the use of a real time
video monitoring system. Global Lock believes that the Master Alarm
Response Centre will become one of the largest in China,
integrating front-end terminal alarm/monitoring servers, detectors,
cameras and patrol guard intelligent terminals, back-end automatic
command & control and video analysis system, cloud computing,
data storage system, financial management system and client
management systems to create a fully integrated platform.
Now that the center has been put into operation, the Board is
currently reviewing the staffing of its branches and plans to
combine the role of alarm patrol with alarm technicians. The Board
anticipates that this will result in a reduction of the number of
the Group's employees by around 300 in the coming one year.
A pilot programme on branch managerial and financial staffing
optimisation has been undertaken. The aim of this programme is to
appoint one regional manager and one accountant to each designated
region with a view to increasing operational efficiencies and
reducing labour costs.
The integration of the management information system and Kingdee
EAS was completed in early June 2014 and the Board expect that this
will improve management efficiency and provide decision-makers with
real-time financial and business data.
Recent developments and trading update
At 31 August 2014, Global Lock had a total of 30,974 clients
which represents a small decrease on the 31,165 customers as at 30
June 2014. The number of branches remained unchanged from the year
end at 72.
The Group held its Interim Meeting in Shenzhen from 8 August to
12 August 2014 to review its operational performance during the
first half year of 2014, as well as to determine the operating
targets and strategic developments for H2:2014.
On 12 August 2014 the Global Lock Hunan branch executed a
Special Merchants Service Agreement with CHINAUMS Merchant Services
Company Limited (which is a company wholly-owned by China UnionPay
and engaged in business in relation to Chinese bank cards,
transactions via bank cards and express financial services), under
which China UnionPay and China CITIC Bank will work together to
issue a Global Lock CITIC UnionPay Card targeted at the Group's
customers. The Board anticipate that this card will enable the
Group's clients to access financing services via a third party and
in so doing they anticipate that this will improve the Group's
competiveness and ability to attract clients.
The Group is currently planning on opening three branches in
Datong, Shan Xi province (northwest of China) giving the Group a
presence in the northwest of China for the first time and the
initial preparations for this have commenced.
On 9 September 2014, the Group signed a Strategic Cooperation
Agreement with Shenzhen Skyeyes Company Limited for the supply of
tailored security devices to the Group.
Future developments and plans
The Group considers that there is currently considerable market
fragmentation and, as such, is evaluating the acquisition of a
number of competitors in order to increase the size of the Group's
operations and benefit from the economies of scale that these
acquisitions will generate. At the same time, the board is also
evaluating the potential acquisition of various complimentary
businesses. The Board aims to develop strategic cooperation through
its products, services and channels in order to identify new
partners, expand its target market and increase the Group's
revenue. Further announcements on these developments will be made
at the appropriate time.
MR. MOXIANG LI, CHAIRMAN
23 September 2014
Condensed consolidated statement of comprehensive income
Note 6 months 6 months 12 months
ended 30 ended 30 ended
June 2014 June 2013 31 Dec
2013
Unaudited Unaudited Audited
RMB'000 RMB'000 RMB'000
Revenue
Fees income 5 41,738 42,066 118,056
Sales business tax (1,512) (2,063) (5,289)
------------ ------------ -----------
40,226 40,003 112,767
Cost of sales (6,644) (6,441) (43,653)
------------ ------------ -----------
Gross profit 33,582 33,562 69,114
Selling and distribution costs (26,628) (27,538) (55,271)
Administrative expenses (3,827) (3,575) (6, 516)
Other income 46 17 26
Profit from operations 3,173 2,466 7,353
Finance cost (849) (649) (1,268)
Profit on ordinary activities
before taxation 2,324 1,817 6,085
Taxation 7 (16) (67) (738)
------------ ------------ -----------
Profit for the year 2,308 1,750 5,347
Other comprehensive income - - -
------------ ------------ -----------
Total comprehensive income
for the year 2,308 1,750 5,347
============ ============ ===========
(Loss)/profit attributable
to:
Owners of the parent (838) (1,016) (433)
Non-controlling interests 3,145 2,766 5,780
------------ ------------ -----------
2,307 1,750 5,347
============ ============ ===========
Total comprehensive (loss)/income
attributable to:
Owners of the parent (838) (1,016) (433)
Non-controlling interests 3,145 2,766 5,780
------------ ------------ -----------
2,307 1,750 5,347
============ ============ ===========
Loss per share (in RMB) 8
Basic (0.003) (0.004) (0.002)
Diluted (0.003) (0.004) (0.002)
All operations are continuing.
Condensed consolidated statement of financial position
Note 30 June 2014 30 June 2013 31 Dec 2013
Unaudited Unaudited Audited
RMB'000 RMB'000 RMB'000
Non-current assets
Intangible assets 10 35,161 37,169 36,204
Property, plant and
equipment 9 21,008 22,220 22,047
Investments 3,000 3,000 3,000
Total non-current assets 59,169 62,389 61,251
------------- ------------- ------------
Current assets
Inventories 6,963 3,674 4,853
Due from customers
for construction contracts 8,540 10,176 10,380
Trade and other receivables 67,037 53,555 60,274
Cash and cash equivalents 5,023 5,475 3,257
------------- ------------- ------------
Total current assets 87,563 72,880 78,764
------------- ------------- ------------
Total assets 146,732 135,269 140,015
============= ============= ============
Equity and reserves
Share capital 12 20,324 20,324 20,324
Statutory reserve 188 66 188
Other Reserves 963 963 963
Retained earnings (9,244) (8,867) (8,406)
------------- ------------- ------------
Total equity and reserves 12,231 12,486 13,069
Non-controlling interest 13 42,024 35,865 38,879
------------- ------------- ------------
Total equity 54,255 48,351 51,948
------------- ------------- ------------
Non-current liabilities
Borrowings 11 1,810 1,809 803
------------- ------------- ------------
Total non-current liabilities 1,810 1,809 803
------------- ------------- ------------
Current liabilities
Borrowings 6,700 2,169 2,105
Trade and other payables 82,473 82,940 63,946
Taxation 1,494 - 1,213
------------- ------------- ------------
90,667 85,109 87,264
------------- ------------- ------------
Total liabilities 92,477 86,918 88,067
------------- ------------- ------------
Total equity and liabilities 146,732 135,269 140,015
============= ============= ============
Condensed consolidated statement of cash flows
6 months 6 months 12 months
ended 30 ended 30 ended 31
June 2014 June 2012 Dec 2013
Unaudited Unaudited Audited
RMB'000 RMB'000 RMB'000
Cash flows from operating activities
Profit before interest and tax 2,324 1,817 6,085
Adjustments for:
Amortization of intangible assets 1,257 1,614 3,831
Depreciation of property, plant
and equipment 4,542 3,026 6,124
Loss on disposal - - -
Financial income - - -
Financial costs 849 649 1,268
Impairment of property, plant -
and equipment - -
----------- ----------- ----------
Operating profit before changes
in working capital 8,972 7,106 11,611
Increase in inventories (2,110) (1,202) (2,381)
Increase in trade and other receivables (4,923) (12,425) (19,348)
Increase in trade and other payables 16,433 2,179 13,288
----------- ----------- ----------
Cash from/(used in) operations 18,372 (4,342) 8,867
Income taxes paid - (67) (109)
----------- ----------- ----------
Net cash from/(used in) operating
activities 18,372 (4,409) 8,758
----------- ----------- ----------
Cash flows from investing activities
Purchase of property, plant and
equipment (3,503) (3,560) (5,475)
Expenditure on intangibles (214) (2,187) (290)
Purchase of customer relationship - - (3,485)
Acquisition of subsidiary - - (500)
Net cash used in investing activities (3,744) (5,747) (9,750)
----------- ----------- ----------
Cash flows from financing activities
Transaction with directors (17,642) 11,951 2,258
Interest paid (849) (649) (1,268)
Borrowings 6,000 - -
Loan repayment (398) (1,059) (2,129)
Net cash from financing activities (12,889) 10,243 (1,139)
----------- ----------- ----------
Net change in cash and cash equivalents 1,766 87 (2,131)
Cash and cash equivalents at beginning
of the period 3,257 5,388 5,388
----------- ----------- ----------
Cash and cash equivalents at end
of the period 5,023 5,475 3,257
=========== =========== ==========
Condensed consolidated statement of changes in equity
Share Statutory Other Retained Non-controlling Total
capital reserve reserve earnings Total interest equity
RMB'000 RMB'000 RMB'000 RMB'000 RMB'000 RMB'000 RMB'000
Balance at 1 January
2013 20,324 188 963 (8,406) 13,069 38,879 51,948
Total comprehensive
(loss)/income for
the year - - - (838) (838) 3,145 2,307
Balance at 30 June
2014 20,324 122 963 (9,244) 12,231 42,024 54,245
========= ========== ========= ========== ======== =================== ========
Balance at 1 January
2013 20,324 66 963 (7,335) 14,018 33,083 47,101
Total comprehensive
(loss)/income for
the period - - - (1,016) (1,016) 2,766 1,750
Acquisition of
non-controlling
interest without
a change in control - - - (516) (516) 16 (500)
--------- ---------- --------- ---------- -------- ------------------- --------
Balance at 30 June
2013 20,324 66 963 (8,867) 12,486 35,865 48,351
========= ========== ========= ========== ======== =================== ========
Balance at 1 January
2013 20,324 66 963 (7,335) 14,018 33,083 47,101
Total comprehensive
(loss)/income for
the period - - - (433) (433) 5,780 5,347
Acquisition of
non-controlling
interest without
a change in control - - - (516) (516) 16 (500)
Transfer of statutory
reserve - 122 - (122) - - -
--------- ---------- --------- ---------- -------- ------------------- --------
Balance at 31 December
2013 20,324 188 963 (8,406) 13,069 38,879 51,948
========= ========== ========= ========== ======== =================== ========
Notes to the condensed consolidated financial statements
1. General information
Global Lock Safety (International) Group Co., Limited ("Global
Lock") is a company incorporated in British Virgin Islands ("BVI")
under the BVI Companies Act, 2004. The address of the registered
office is Akara Building, 24 De Castro Street, Wickhams Cay 1, Road
Town, Tortola, BVI. Global Lock is an investment company.
The nature of the Global Lock Group's operation and its
principal activity is the provision of security solutions to retail
stores across the People's Republic of China ("PRC"). The principal
place of business of the Global Lock Group's operation is at Room
507, Unit 1, Jinghua Zhong Industrial Park, Jinlong Avenue 2,
Baolong Industrial Park, Longgang District, Shenzhen, China.
The group carries out its trading business through Shenzhen
Global Lock Security System Engineering Co., Ltd (Shenzhen GLOK), a
company incorporated in PRC. Global Lock Safety (Shenzhen) Limited
("Global Lock WFOE"), a wholly owned subsidiary of Global Lock has
entered into certain long term contractual agreements with Shenzhen
GLOK that all profits generated by Shenzhen GLOK are to be paid to
Global Lock WFOE.
These condensed financial statements present information about
the group and are set out in Renminbi ("RMB") of the PRC, which is
the functional currency of the group.
These condensed financial statements are presented in the
nearest thousands.
2. Basis of preparation
These condensed financial statements have been prepared in
accordance with International Accounting Standard 34 Interim
Financial Reporting.
The interim report is unaudited and does not constitute the
company's statutory accounts for the six months ended 30 June
2014.
The results of Shenzhen GLOK were fully consolidated in these
financial statements under IAS 27 through the contractual
agreements where full managerial, operational and financial control
of Shenzhen GLOK has been granted to Global Lock WFOE.
As announced on 17 May 2013, Global Lock WFOE and Shenzhen GLOK
have agreed to vary the exclusive Technology Support Agreement with
effect from 1 January 2012 so that instead of the service fee being
calculated by reference to the operating revenue of Shenzhen GLOK
in any profitable quarter it will be 25 per cent. of Shenzhen
GLOK's profit before tax for the financial year in question.
3. Significant accounting policies
The condensed financial statements have been prepared under the
historical cost convention.
The same accounting policies, presentation and methods of
computation have been followed in these condensed financial
statements as were applied in the preparation of the group's
financial statements for the year ended 31 December 2013.
Notes to the condensed consolidated financial statements -
continued
4. Seasonality of interim operations
The revenue of the group has increased significantly compared to
the first six months of last year. This is mainly due to
accountability management in the branch level and sales teams and
collaboration with China Legal Daily (an official newspaper
distributed to all Chinese government department and law
enforcement agencies). As a result of this, the number of customers
has increased from 26,833 to 31,165
5. Segment information
The group's revenue and profit before taxation were all derived
from only one segment which is its principal activity. All revenue
originates in the PRC and assets are mainly held in the PRC. As a
result of this, management considered that no segment reporting is
required.
6. Share-based payment charge
On 17 October 2010, Global Lock granted Allenby Capital, its
NOMAD "warrants to subscribe for ordinary share" which is equal to
1% of the fully diluted equity (the equity share capital of GLOK
from time to time plus all equity share capital which would arise
on exercise in full of all rights to subscribe for or convert into
equity share capital).
Judgements and estimates are required in determining the share
based payment charge as an expense in the income statement. The
directors have used Black-Scholes model which has been widely used
in valuing the share based payment charge. The directors are in the
opinion that the model used has been adjusted to their best
estimate in arriving at the charge.
7. Taxation
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.
Global Lock is regarded as resident for the tax purposes in BVI.
There are no applicable taxes in the BVI for the company.
GLOK Shenzhen and Shenzhen GLOK are regarded as residents for
the tax purposes in PRC and subject to national income tax rate at
25%. Due to its high technology enterprise status, the company is
entitled to a reduction in tax rate at 15%.
Interim income tax is accrued based on 15% tax rate.
Notes to the condensed consolidated financial statements
-continued
8. Earnings per share
Basic loss per share
Basic loss per share is calculated by dividing the loss
attributable to equity shareholders of the company by the weighted
average number of ordinary shares in issue during the year.
30 June
2014
RMB'000
Loss attributable to equity holders of the company (838)
========
Weighted average number of shares in issue (thousands) 250,000
========
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.
Weighted average number of ordinary shares (diluted):
30 June
2014
(thousands)
At beginning of the period 250,000
Effect of conversion of share options -
------------
At end of period 250,000
============
9. Property, plant and equipment
During the period, the group made additions of approximate RMB
3.5 million to property, plant and equipment.
10. Intangible assets
During the period, the group spent approximate RMB 0.21 million
on development projects
Notes to the condensed consolidated financial statements -
continued
11. Share capital
The issued share capital of the company as at 30 June 2014 is
RMB 20,323,800 fully paid. There were no movements in the issued
share capital of the company in the current interim reporting
periods.
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 30 June 2013, the company had the following outstanding share
options:
Date of grant: 17 Oct 2010
Number of option: 1% of the fully diluted equity
Option price: 16 pence (the lowest closing bid price of the
ordinary shares for the one week period following Admission on 21
October 2010)
Exercise period: 21.10.2010 - 20.10.2015
12. Borrowing
During the period, the company obtained two borrowing at RMB 3
million each where both are short term loans and will be repayable
within 1 year. The borrowing rates are 6.8% and 22.5% respectively
and the proceeds were used for short term working capital
needs.
13. Related party transactions
As at balance sheet date, the amount due to Mr Moxiang Li is RMB
12,608,580.46 (H1 2013: RMB 30,251,362). The loan amounts are
interest free and repayable on demand.
In addition, the company's Chairman, Mr Moxiang Li, is the
controlling party of, and has a 99% beneficial ownership in,
Shenzhen Global Lock Security System Engineering Co., Limited
group, and the remaining 1% beneficial ownership held by Mr. Jiafa
Wang. Both of their beneficial interests represent the
non-controlling interests in these financial statements
Xinhua Xianghui Electronic Technology Co., Limited
Xinhua Xianghui, the key supplier of the Group's equipment, is
owned by some of the directors. Details of transactions with Xinhua
Xianghui are presented below:
6 months ended 6 months ended
30 June 2014 30 June 2013
RMB RMB
Purchase of equipment 4,063,826 3,560,000
Balance payable 3,130,046 2,673,257
Prepayment for machinery equipment 6,118,000 1,715,279
Notes to the condensed consolidated financial statements -
continued
Family Fortune International Co., Ltd
The Group has a non-trade balance receivable from a shareholder
of the Company, Family Fortune International Co., Ltd, of RMB
102,650 (H1 2013: RMB 49,650).
Shenzhen Family Fortune Investment Co., Ltd
The Group has non-trade balance receivable to Shenzhen Family
Fortune Investment Co., Ltd, a company with some common directors,
of RMB 1,989,549.54 (H1 2013: RMB 1,323,450).
Shenzhen Lin En Energy Investment Co., Ltd
The Group has non-trade balance receivable to Shenzhen Lin En
Energy Investment Co., Ltd, a company with some common directors,
of RMB 198,418 (H1 2013: RMB 198,418).
Shenzhen Family Fortune Security System Engineering Co., Ltd
The Group has non-trade balance receivable to Shenzhen Family
Fortune Security System Engineering Co., Ltd, a company with some
common directors, of RMB 206,559.63 (H1 2013: RMB 198,418).
Global Lock International Investment Ltd
The Group has non-trade balance receivable to Global Lock
International Investment Ltd, a company with some common directors,
of RMB 7,235 (H1 2013: RMB 7,235).
End
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR GCGDCLSDBGSX
Glbal Lck Grp (LSE:GLOK)
Historical Stock Chart
From Apr 2024 to May 2024
Glbal Lck Grp (LSE:GLOK)
Historical Stock Chart
From May 2023 to May 2024
